thl credit wind river 2014-2 clo ltd. thl credit …nov 23, 2017 · thl credit wind river 2014-2...
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The Bank of New York Mellon Trust Company, National Association
THL CREDIT WIND RIVER 2014-2 CLO LTD.
THL CREDIT WINDER RIVER 2014-2 CLO LLC
NOTICE OF PROPOSED SUPPLEMENTAL INDENTURE
NOTE: THIS NOTICE CONTAINS IMPORTANT INFORMATION THAT IS OF INTEREST TO THE REGISTERED AND BENEFICIAL OWNERS OF THE SUBJECT DEBT. IF APPLICABLE, ALL DEPOSITORIES, CUSTODIANS, AND OTHER INTERMEDIARIES RECEIVING THIS NOTICE ARE REQUESTED TO EXPEDITE RE-TRANSMITTAL TO BENEFICIAL OWNERS OF THE DEBT IN A TIMELY MANNER.
November 22, 2017
To: The Holders described as:
∗ No representation is made as to the correctness of the CUSIP, ISIN or Common Code numbers either as printed on the Notes or as contained in this notice. Such numbers are included solely for the convenience of the Noteholders.
Class Designation
CUSIP∗ Rule 144A
ISIN* Rule 144A
Common Code* Reg S
CUSIP* Reg. S.
ISIN* Reg. S.
CUSIP* Certificated
Acc’d Investor
ISIN* Certificated
Acc’d Investor
Class A-1 Notes 88390A AA8 US88390AAA88 110223285 G88295 AA1 USG88295AA17 88390A AB6 US88390AAB61
Class A-2 Notes 88390A AC4 US88390AAC45 110223293 G88295 AB9 USG88295AB99 88390A AD2 US88390AAD28
Class A Loans N/A N/A N/A N/A N/A N/A N/A
Class B-1 Notes 88390A AF7 US88390AAF75 110223307 G88295 AC7 USG88295AC72 88390A AG5 US88390AAG58
Class B-2 Notes 88390A AM2 US88390AAM27 110223315 G88295 AF0 USG88295AF04 88390A AP5 US88390AAP57
Class C-1 Notes 88390A AH3 US88390AAH32 110223323 G88295 AD5 USG88295AD55 88390A AJ9 US88390AAJ97
Class C-2 Notes 88390A AN0 US88390AAN00 110223331 G88295 AG8 USG88295AG86 88390A AQ3 US88390AAQ31
Class D Notes 88390A AK6 US88390AAK60 110223340 G88295 AE3 USG88295AE39 88390A AL4 US88390AAL44
Class E Notes 88432B AA6 US88432BAA61 110223358 G88298 AA5 USG88298AA55 88432B AE8 US88432BAE83
Class F Notes 88432B AB4 US88432BAB45 110223374 G88298 AB3 USG88298AB39 88432B AF5 US88432BAF58
Subordinated Notes 88432B AC2 US88432BAC28 110223366 G88298 AC1 USG88298AC12 88432B AD0 US88432BAD01
Income Notes 87245L AA3 US87245LAA35 110223382 G8830B AA5 USG8830BAA55 87245L AB1 US87245LAB18
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Class Designation
CUSIP* Certificated Rule 144A
ISIN* Certificated Rule 144A
Subordinated Notes 88432B AC2 US88432BAC28
Income Notes 87245L AA3 US87245LAA35 To: Those Additional Parties Listed on Schedule I hereto
Reference is hereby made to that certain (i) Indenture and Security Agreement dated as of August 21, 2014, (as amended and supplemented by the First Supplemental Indenture dated as of October 14, 2016, the “Indenture”), among THL CREDIT WIND RIVER 2014-2 CLO LTD., as issuer (the “Issuer”), THL CREDIT WIND RIVER 2014-2 CLO LLC, as co-issuer (the “Co-Issuer”, and together with the Issuer, the “Co-Issuers”), and THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION (“BNYM”), as trustee (the “Trustee”) and collateral agent (the “Collateral Agent”) and (ii) Credit Agreement dated as of August 21, 2014 (as amended, restated and supplemented from time to time, the “Credit Agreement”), among the Issuer, as borrower, the Co-Issuer, as co-borrower, various financial institutions party thereto, as lenders, and BNYM, as loan agent (the “Loan Agent”) and Collateral Agent. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Indenture or the Credit Agreement, as applicable.
On November 15, 2017, pursuant to Section 9.2(a) of the Indenture, a Majority of the Subordinated Notes directed the redemption or prepayment, as applicable, of all Classes of Rated Debt from Refinancing Proceeds (the “Refinancing”) to occur on or after December 14, 2017 (the “Refinancing Date”). The Refinancing is subject to the satisfaction of the applicable conditions precedent set forth in the Indenture.
In accordance with Section 8.2(b) of the Indenture, the Collateral Agent hereby notifies
you of the proposed supplemental indenture and security agreement (the “Proposed Supplemental Indenture”), which will supplement the Indenture according to its terms in order to reflect the terms of such Refinancing and which will be executed by the Co-Issuers, the Trustee and the Collateral Agent upon (i) receipt of consent of 100% of the Subordinated Notes to the terms of the Proposed Supplemental Indenture and (ii) satisfaction of all other applicable conditions precedent set forth in the Indenture and the Credit Agreement. The proposed date of execution of the Proposed Supplemental Indenture is the Refinancing Date. A copy of the Proposed Supplemental Indenture is attached hereto as Exhibit A.
The record date for determining the Holders entitled to receive this Notice of Proposed Supplemental Indenture shall be November 22, 2017.
PLEASE NOTE THAT THE FOREGOING IS NOT INTENDED AND SHOULD NOT
BE CONSTRUED AS INVESTMENT, ACCOUNTING, FINANCIAL, LEGAL OR TAX ADVICE BY OR ON BEHALF OF THE COLLATERAL AGENT, THE TRUSTEE OR THE LOAN AGENT, OR THEIR DIRECTORS, OFFICERS, AFFILIATES, AGENTS, ATTORNEYS OR EMPLOYEES. THE COLLATERAL AGENT, THE TRUSTEE AND THE LOAN AGENT MAKE NO RECOMMENDATIONS TO THE HOLDERS OF DEBT AS TO ANY ACTION TO BE TAKEN OR NOT TO BE TAKEN WITH RESPECT TO THE
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PROPOSED AMENDED AND RESTATED INDENTURE OR OTHERWISE AND ASSUME NO RESPONSIBILITY FOR THE CONTENTS, SUFFICIENCY OR VALIDITY OF THE DESCRIPTION OF THE PROPOSED AMENDED AND RESTATED INDENTURE CONTAINED HEREIN OR ATTACHED HERETO.
Should you have any questions, please contact Marie Perisee or Jack Hung at (312) 827-
1381 and (713) 483-7020, respectively, or at [email protected] and [email protected], respectively.
THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee, Collateral Agent and Loan Agent
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EXHIBIT A
Proposed Supplemental Indenture
DRAFT 11/22/2017
SECOND SUPPLEMENTAL INDENTURE AND SECURITY AGREEMENT
to the
INDENTURE AND SECURITY AGREEMENT dated as of August 21, 2014
by and among
THL CREDIT WIND RIVER 2014-2 CLO LTD., as Issuer,
THL CREDIT WIND RIVER 2014-2 CLO LLC, as Co-Issuer,
and
THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee and Collateral Agent
This SECOND SUPPLEMENTAL INDENTURE AND SECURITY AGREEMENT dated as of [], 2017 (this “Supplemental Indenture”) to the Indenture and Security Agreement dated as of August 21, 2014 (as amended by the Supplemental Indenture and Security Agreement, dated as of October 14, 2016, the “Indenture”) is entered into by and among THL Credit Wind River 2014-2 CLO Ltd., an exempted company incorporated with limited liability under the laws of the Cayman Islands (the “Issuer”), THL Credit Wind River 2014-2 CLO LLC, a limited liability company organized under the laws of the State of Delaware (the “Co-Issuer” and, together with the Issuer, the “Co-Issuers”), and The Bank of New York Mellon Trust Company, National Association, a national banking institution, as trustee under the Indenture (together with its permitted successors in such capacity, the “Trustee”) and as collateral agent (together with its permitted successors in such capacity, the “Collateral Agent”). Capitalized terms used but not otherwise defined herein shall have the respective meanings set forth in the blackline Indenture attached hereto as Annex A.
PRELIMINARY STATEMENT
WHEREAS, pursuant to Section 9.2(a), a Majority of the Subordinated Notes has directed the redemption in whole of all Classes of Rated Debt from Refinancing Proceeds in accordance with Sections 9.2 and 9.5 of the Indenture (such Majority of the Subordinated Notes, the “Directing Holders”);
WHEREAS, the Co-Issuers wish to issue replacement notes in connection with such Refinancing in a manner that meets the requirements of Section 9.2 of the Indenture;
WHEREAS, the Directing Holders have approved the terms of the Refinancing;
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WHEREAS, the Co-Issuers and the Investment Manager wish to amend the Indenture pursuant to Sections 8.2 and 9.2(e) to effect the modifications set forth in Section 1 below;
WHEREAS, pursuant to Section 8.2 of the Indenture, the Holders of 100% of the Subordinated Notes and the Investment Manager have consented to this Supplemental Indenture;
WHEREAS, the conditions set forth for entry into a supplemental indenture pursuant to Sections 8.2 and 8.3 of the Indenture have been satisfied;
WHEREAS, pursuant to Section 3.3.5 of the Credit Agreement, the Co-Issuers will repay the Loans (as defined in the Credit Agreement) in connection with such Refinancing;
NOW, THEREFORE, in consideration of the mutual agreements herein set forth, the parties agree as follows:
1. Amendments. Effective as of the date hereof upon satisfaction of the conditions set forth in Section 2 below, the Indenture (including the Schedules and Exhibits thereto) is amended pursuant to Sections 8.2 and 9.2, as follows:1
(a) The Indenture (including the Schedules thereto) is amended by deleting the stricken text (indicated in the same manner as the following example: stricken text) and adding the inserted text (indicated in the same manner as the following example: inserted text) as set forth on the pages of the draft Indenture attached as Annex A hereto.
(b) The Exhibits to the Indenture are amended as reasonably acceptable to the Trustee, the Investment Manager and the Holders of the Subordinated Notes in order to conform such Exhibits to the modifications to be made in the Indenture.
(c) In connection with the aforementioned amendments of the Indenture, the Issuer shall cause such Transaction Documents as it deems necessary to be amended to reflect the changes made to the Indenture and to make any other necessary changes in connection therewith. The Trustee is hereby authorized and directed to execute and deliver such amendment as provided to the Trustee by or on behalf of the Issuer.
2. Conditions Precedent. The modifications to be effected pursuant to Section 1 above shall become effective as of the date first written above upon receipt by the Trustee of each of the following:
(i) an Officer’s certificate (A)(I) of the Co-Issuer evidencing the authorization by Board Resolution of the execution and delivery of this Supplemental Indenture and the Placement Agency Agreement relating to the Refinancing Notes (as defined herein) and the execution, authentication and delivery of the Class X Notes, the Class A-R Notes, the Class B-R Notes, the Class C-R Notes and the Class D-R Notes (the “Co-Issued Refinancing Rated Notes”) 1 The final version of this Supplemental Indenture will reflect any additional changes to the Indenture (including the Schedules and Exhibits thereto) as shall be agreed by the Co-Issuers and the Investment Manager prior to its effective date, subject to the applicable consent requirements of Article VIII to the Indenture but without giving regard to any prior notice requirement set forth in the Indenture.
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and (II) of the Issuer evidencing the authorization by Board Resolution of the execution and delivery of this Supplemental Indenture and the Placement Agency Agreement relating to the Refinancing Notes and the execution, authentication and delivery of the Co-Issued Refinancing Rated Notes, the Class E-R Notes, the Class F-R Notes and $[] additional Subordinated Notes (collectively, the “Refinancing Notes”), in each case under this clause (A) applied for by it and specifying the Stated Maturity, principal amount and, as applicable, Note Interest Rate of each Class of Refinancing Notes to be authenticated and delivered, and (B) of each of the Co-Issuer and the Issuer certifying that (1) the attached copy of the Board Resolution is a true and complete copy thereof, (2) such Board Resolutions have not been rescinded and are in full force and effect on and as of the Amendment Date and (3) the Officers authorized to execute and deliver such documents hold the offices and have the signatures indicated thereon;
(ii) from each of the Co-Issuer and the Issuer either (A) a certificate of the Applicable Issuer or other official document evidencing the due authorization, approval or consent of any governmental body or bodies, at the time having jurisdiction in the premises, together with an Opinion of Counsel of such Applicable Issuer to the effect that no other authorization, approval or consent of any governmental body is required for the valid issuance of the Refinancing Notes, or (B) an Opinion of Counsel of the Applicable Issuer to the effect that no such authorization, approval or consent of any governmental body is required for the valid issuance of such Refinancing Notes except as have been given (provided that the opinions delivered pursuant to clause (iii) below may satisfy this requirement);
(iii) opinions of (i) Cadwalader, Wickersham & Taft LLP, special U.S. counsel to the Co-Issuers, (ii) Seward & Kissel, counsel to the Trustee, and (iii) Maples and Calder, Cayman Islands counsel to the Issuer, in each case dated the Amendment Date, in form and substance satisfactory to the Issuer and the Trustee;
(iv) an Officer’s certificate of each of the Co-Issuer and the Issuer stating that the Applicable Issuer is not in default under the Indenture and that the issuance of the Refinancing Notes applied for by it shall not result in a default or a breach of any of the terms, conditions or provisions of, or constitute a default under, its organizational documents, any indenture or other agreement or instrument to which it is a party or by which it is bound, or any order of any court or administrative agency entered in any Proceeding to which it is a party or by which it may be bound or to which it may be subject; that all conditions precedent provided in the Indenture relating to the authentication and delivery of the Refinancing Notes applied for by it have been complied with; that all expenses due or accrued with respect to the offering of the Refinancing Notes or relating to actions taken on or in connection with the Amendment Date have been paid or reserves therefor have been made; and that all of its representations and warranties contained in the Indenture are true and correct as of the Amendment Date.
(v) a letter signed by each Rating Agency confirming that the Class A-R Notes are rated “[Aaa(sf)]” by Moody’s and “[AAA(sf)]” by Fitch, the Class B-R Notes are rated at least “[Aa2(sf)]” by Moody’s, the Class C-R Notes are rated at least “[A2(sf)]” by Moody’s, the Class D-R Notes are rated at least “[Baa3(sf)]” by Moody’s, the Class E-R Notes are rated at least “[Ba3(sf)]” by Moody’s and the Class F-R Notes are rated at least “[B3(sf)]” by Moody’s [and] the Class X Notes are rated “[Aaa(sf)]” by Moody’s;
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(vi) an Issuer Order by each Co-Issuer directing the Trustee to authenticate the Refinancing Notes in the amounts and names set forth therein and to apply the proceeds thereof to redeem the Class A-1 Senior Secured Floating Rate Notes due 2026, Class A-2 Senior Secured Floating Rate Notes due 2026, Class B-1 Senior Secured Floating Rate Notes due 2026, Class B-2 Senior Secured Floating Rate Notes due 2026, Class C-1 Secured Deferrable Floating Rate Notes due 2026, Class C-2 Secured Deferrable Floating Rate Notes due 2026, Class D Secured Deferrable Floating Rate Notes due 2026, Class E Secured Deferrable Floating Rate Notes due 2026 and Class F Secured Deferrable Floating Rate Notes due 2026 issued on the Closing Date at the applicable Redemption Prices therefor on the Amendment Date[; and]
(vii) [an Issuer Order by the Issuer to authenticate Subordinated Notes in the amount and name set forth therein, to reflect the increase of Income Notes issued on the Amendment Date under the Income Note Paying Agency Agreement].
3. Consent of the Holders of the Refinancing Notes.
Each Holder or beneficial owner of a Refinancing Note, by its acquisition thereof on the Amendment Date, shall be deemed to agree to the terms of the Indenture including the amendments set forth in this Supplemental Indenture and the execution of the Co-Issuers and the Trustee hereof.
4. Governing Law.
THIS SUPPLEMENTAL INDENTURE AND EACH NOTE AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS SUPPLEMENTAL INDENTURE AND EACH NOTE, THE RELATIONSHIP OF THE PARTIES, AND/OR THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED IN ALL RESPECTS (WHETHER IN CONTRACT OR IN TORT) BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS.
5. Execution in Counterparts.
This Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. Delivery of an executed counterpart of this Supplemental Indenture by electronic means (including email or telecopy) will be effective as delivery of a manually executed counterpart of this Supplemental Indenture.
6. Concerning the Trustee.
The recitals contained in this Supplemental Indenture shall be taken as the statements of the Co-Issuers, and the Trustee assumes no responsibility for their correctness. Except as provided in the Indenture, the Trustee shall not be responsible or accountable in any way whatsoever for or with respect to the validity, execution or sufficiency of this Supplemental Indenture and makes no representation with respect thereto. In entering into this Supplemental Indenture, the Trustee shall be entitled to the benefit of every provision of the Indenture relating to the conduct of or affecting the liability of or affording protection to the Trustee.
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7. Non-Petition; Limited Recourse.
The parties hereto agree to the provisions set forth in Sections 2.8(i) and 5.4(d) of the Indenture, and such provisions are incorporated in this Supplemental Indenture, mutatis mutandis.
8. No Other Changes.
Except as provided herein, the Indenture shall remain unchanged and in full force and effect, and each reference to the Indenture and words of similar import in the Indenture, as amended hereby, shall be a reference to the Indenture as amended hereby and as the same may be further amended, supplemented and otherwise modified and in effect from time to time.
9. Execution, Delivery and Validity.
Each of the Co-Issuers represents and warrants to the Trustee that this Supplemental Indenture has been duly and validly executed and delivered by it and constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms.
10. Binding Effect.
This Supplemental Indenture shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
11. Direction to Trustee and Collateral Agent.
The Issuer hereby directs each of the Trustee and the Collateral Agent to execute this Supplemental Indenture and acknowledges and agrees that each of the Trustee and the Collateral Agent shall be entitled to rely on the foregoing direction.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and delivered by their respective proper and duly authorized officers as of the day and year first above written.
EXECUTED AS A DEED BY:
THL CREDIT WIND RIVER 2014-2 CLO LTD., as Issuer
By: _______________________________________
Name: Title:
In the presence of: _______________________________________
Witness: Name:
Title:
THL CREDIT WIND RIVER 2014-2 CLO LLC, as Co-Issuer
By: _______________________________________ Name: Title:
THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, as Collateral Agent
By: _______________________________________ Name: Title:
THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee
By: _______________________________________ Name: Title:
Acknowledged and consented to: THL CREDIT ADVISORS LLC,
as Investment Manager
By:___________________________________ Name: Title:
ANNEX A
EXECUTION VERSIONDRAFT 11/22/2017
Conformed through the Supplemental Indenture, and Security Agreement, dated as of October 14, 2016
and through the Second Supplemental Indenture and Security Agreement, dated as of [__], 2017
THL CREDIT WIND RIVER 2014-2 CLO LTD.Issuer,
THL CREDIT WIND RIVER 2014-2 CLO LLCCo-Issuer,
AND
THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATIONTrustee and Collateral Agent
INDENTURE AND SECURITY AGREEMENT
COLLATERALIZED LOAN OBLIGATIONS
Dated as of August 21, 2014
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.1 Definitions 2Section 1.2 Rules of Construction 6872Section 1.3 Assumptions as to Pledged Obligations 6973
ARTICLE II
THE NOTES
Section 2.1 Forms Generally 7175Section 2.2 Forms of Notes 7276Section 2.3 Authorized Amount; Stated Maturity; Denominations 7377Section 2.4 Additional Debt 74Notes 79Section 2.5 Execution, Authentication, Delivery and Dating 7781Section 2.6 Registration, Registration of Transfer and Exchange 7782Section 2.7 Mutilated, Defaced, Destroyed, Lost or Stolen Note 9095Section 2.8 Payment of Principal and Interest and Other Amounts; Principal and
Interest Rights Preserved 9196Section 2.9 Persons Deemed Owners 9499Section 2.10 Surrender of Notes; Cancellation 9499Section 2.11 Certificated Notes 9499Section 2.12 Notes Beneficially Owned by Persons Not QIB/QPs, IAI/QPs or AI/QPs
or in Violation of ERISA Representations 95100Section 2.13 Deduction or Withholding from Payments on DebtNotes; No Gross Up 96101Section 2.14 Conversion of Class A Loans to Class A-1 Notes 96[Reserved] 102Section 2.15 Tax Certifications 97102Section 2.16 Issuer Purchases of Rated Debt 101Notes 106
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 Conditions to Issuance of Notes on Closing Date 102107Section 3.2 Conditions to Issuance of Additional Debt 105Notes 110Section 3.3 Custodianship; Delivery of Collateral Obligations and Eligible
Investments 107112
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ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.1 Satisfaction and Discharge of Indenture and Security Agreement 108. 113Section 4.2 Application of Money 110114Section 4.3 Repayment of Monies Held by the Income Note Paying Agent 110115Section 4.4 Limitation on Obligation to Incur Administrative Expenses 110115
ARTICLE V
REMEDIES
Section 5.1 Events of Default 111115Section 5.2 Acceleration of Maturity; Rescission and Annulment 112117Section 5.3 Collection of Indebtedness and Suits for Enforcement by the Collateral
Agent 113Trustee 118Section 5.4 Remedies 115120Section 5.5 Optional Preservation of Assets 117122Section 5.6 Collateral AgentTrustee May Enforce Claims without Possession of
Notes 119124Section 5.7 Application of Money Collected 119124Section 5.8 Limitation on Suits 119124Section 5.9 Unconditional Rights of Holders of Rated DebtNotes to Receive
Principal and Interest 120125Section 5.10 Restoration of Rights and Remedies 120125Section 5.11 Rights and Remedies Cumulative 121125Section 5.12 Delay or Omission Not Waiver 121125Section 5.13 Control by Supermajority of Controlling Class 121126Section 5.14 Waiver of Past Defaults 121126Section 5.15 Undertaking for Costs 122127Section 5.16 Waiver of Stay or Extension Laws 122127Section 5.17 Sale of Assets 123127Section 5.18 Action on the Notes 124128
ARTICLE VI
THE TRUSTEE AND THE COLLATERAL AGENT
Section 6.1 Certain Duties and Responsibilities of the 124128Section 6.2 Certain Rights of Trustee 126130Section 6.3 Not Responsible for Recitals or Issuance of Notes 130134Section 6.4 May Hold Debt 130Notes 134Section 6.5 Money Held in Trust 130135Section 6.6 Compensation and Reimbursement of Trustee 130135
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Section 6.7 Corporate Trustee Required; Eligibility 131136Section 6.8 Resignation and Removal; Appointment of Successor 132136Section 6.9 Acceptance of Appointment by Successor 133138Section 6.10 Merger, Conversion, Consolidation or Succession to Business of Trustee134138Section 6.11 Co-Trustees 134139Section 6.12 Authenticating Agents 135140Section 6.13 Representations and Warranties of the Bank 136140Section 6.14 Communication with Rating Agencies 136141Section 6.15 The Collateral Agent 137Trustee 141
ARTICLE VII
COVENANTS
Section 7.1 Payment of Principal and Interest 150153Section 7.2 Maintenance of Office or Agency 150153Section 7.3 Money for DebtNote Payments to Be Held in Trust 151154Section 7.4 Existence of Co-Issuers 153156Section 7.5 Protection of Assets 154157Section 7.6 Opinions as to Assets 155158Section 7.7 Performance of Obligations 155159Section 7.8 Negative Covenants 156159Section 7.9 Statement as to Compliance 159162Section 7.10 Co-Issuers May Consolidate, etc. Only on Certain Terms 159162Section 7.11 Successor Substituted 161164Section 7.12 No Other Business 161164Section 7.13 Annual Rating Review 162165Section 7.14 Reporting 162165Section 7.15 Calculation Agent 162165Section 7.16 Certain Tax Matters 163166Section 7.17 Ramp-Up Period; Purchase of Additional Collateral Obligations 171174Section 7.18 Representations Relating to Security Interests in the Assets 173176Section 7.19 Acknowledgement of Investment Manager Standard of Care 175178Section 7.20 Maintenance of Listing 176179Section 7.21 Section 3(c)(7) Procedures 176179Section 7.22 FATCA Compliance 177179
ARTICLE VIII
SUPPLEMENTAL INDENTURE AND SECURITY AGREEMENTSINDENTURES
Section 8.1 Supplemental Indenture and Security AgreementsIndentures withoutConsent of Holders of Debt 177Notes 180
Section 8.2 Supplemental Indenture and Security AgreementsIndentures withConsent of Holders of Debt 182Notes 185
Section 8.3 Execution of Supplemental Indenture and Security Agreements 184Indentures 186
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Section 8.4 Effect of Supplemental Indenture and Security Agreements 185Indentures 188Section 8.5 Reference in Notes to Supplemental Indenture and Security Agreements185Indentures 189Section 8.6 Re-Pricing Amendment 186189
ARTICLE IX
REDEMPTION OF NOTES
Section 9.1 Mandatory Redemption 186189Section 9.2 Optional Redemption 186189Section 9.3 Partial Redemption by Refinancing 188191Section 9.4 Redemption Following a Tax Event 190193Section 9.5 Redemption Procedures 190193Section 9.6 DebtNotes Payable on Redemption Date 192195Section 9.7 Special Redemption 192196Section 9.8 Clean-Up Call Redemption 193196Section 9.9 Re-Pricing of Rated Debt 194Notes 197
ARTICLE X
ACCOUNTS, ACCOUNTINGS AND RELEASES
Section 10.1 Collection of Money 197201Section 10.2 Collection Accounts 197201Section 10.3 Payment Account; Custodial Account; Ramp-Up Account; Expense
Reserve Account; Interest Reserve Account; Unfunded ExposureAccount 199203
Section 10.4 Hedge Counterparty Collateral Account 202205Section 10.5 Reinvestment of Funds in Accounts; Reports by Collateral Agent 202Trustee 205Section 10.6 Accountings 204207Section 10.7 Release of Securities 212216Section 10.8 Reports by Independent Accountants 213217Section 10.9 Reports to Rating Agencies 214218Section 10.10 Procedures Relating to the Establishment of Accounts Controlled by the
Collateral Agent 215Trustee 218
ARTICLE XI
APPLICATION OF MONIES
Section 11.1 Disbursements of Monies from Payment Account 215218Section 11.2 Contributions 226
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ARTICLE XII
SALE OF COLLATERAL OBLIGATIONS; PURCHASE OF ADDITIONAL COLLATERALOBLIGATIONS
Section 12.1 Sales of Collateral Obligations 222227Section 12.2 Purchase of Additional Collateral Obligations 224230Section 12.3 Conditions Applicable to All Sale and Purchase Transactions 228234
ARTICLE XIII
HOLDERS’ RELATIONS
Section 13.1 Subordination 229234Section 13.2 Standard of Conduct 229235
ARTICLE XIV
MISCELLANEOUS
Section 14.1 Form of Documents Delivered to Trustee and the Collateral Agent 230Trustee 235Section 14.2 Acts of Holders 231236Section 14.3 Notices, etc., to Trustee, the Collateral Agent, the Co-Issuers, the
Collateral Administrator, the Investment Manager, the HedgeCounterparty, the Income Note Paying Agent, the Administrator andeach Rating Agency 231236
Section 14.4 Notices to Holders; Waiver 234239Section 14.5 Effect of Headings and Table of Contents 235240Section 14.6 Successors and Assigns 235240Section 14.7 Separability 235240Section 14.8 Benefits of Indenture and Security Agreement 236. 240Section 14.9 Governing Law 236240Section 14.10 Submission to Jurisdiction 236240Section 14.11 Counterparts 236241Section 14.12 Acts of Issuer 236241Section 14.13 Confidential Information 236241Section 14.14 Liability of Co-Issuers 238242Section 14.15 17g-5 Information 238243Section 14.16 Rating Agency Conditions 241245Section 14.17 Waiver of Jury Trial 241246Section 14.18 Escheat 242246Section 14.19 Records 242246Section 14.20 Redemption 242Section 14.21 The Collateral Agent and the Loan Agent 242
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ARTICLE XV
ASSIGNMENT OF INVESTMENT MANAGEMENT AGREEMENT
Section 15.1 Assignment of Investment Management Agreement 242246
ARTICLE XVI
HEDGE AGREEMENTS
Section 16.1 Hedge Agreements 243247
Schedule 1 – Moody’s Industry Classification Group ListSchedule 2 – S&P Industry ClassificationsSchedule 3 – Diversity Score CalculationSchedule 4 – Moody’s Rating DefinitionsSchedule 5 – Fitch Rating Definitions
Exhibit A – Forms of NotesA1 – Form of Class AX NoteA2 – Form of Class A NoteA3 – Form of Class B NoteA34 – Form of Class C NoteA45 – Form of Class D NoteA56 – Form of Class E NoteA67 – Form of Class F NoteA78 – Form of Subordinated Note
Exhibit B – Forms of Transfer and Exchange CertificatesB1 – Form of Transferor Certificate for Transfer of Rule 144A Global Notes
or Certificated Notes to Regulation S Global NotesB2A – Form of Transferor Certificate for Transfer of Regulation S Global
Notes to Rule 144A Global Notes or Certificated NotesB2B – Form of Transferor Certificate for Transfer of Certificated Notes to
Rule 144A Global NotesB3 – Form of Transferee Certificate for Transfer of Regulation S Global
Notes or Certificated Notes to Rule 144A Global NotesB4 – Form of Transferee Certificate for Transfer of Rule 144A Global
Notes, Regulation S Global Notes or Certificated Notes to CertificatedNotes
B5 – Form of Transferee Certificate for Transfer of Rule 144A GlobalNotes or Certificated Notes to Regulation S Global Notes
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B6 - Form of Transferor Certificate for Subordinated Notes Regarding Contribution Repayment Amounts
Exhibit C – Calculation of LIBOR[Reserved]Exhibit D – Form of DebtNotes Owner CertificateExhibit E – Form of NRSRO CertificationExhibit F – Section 13 Banking Entity CertificateExhibit G – Form of Contribution NoticeExhibit H – Form of Contribution Participation Notice
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INDENTURE AND SECURITY AGREEMENT, dated as of August 21, 2014,among THL CREDIT WIND RIVER 2014-2 CLO LTD., an exempted company incorporatedwith limited liability under the laws of the Cayman Islands (the “Issuer”), THL CREDIT WINDRIVER 2014-2 CLO LLC, a limited liability company formed under the laws of the State ofDelaware (the “Co-Issuer” and, together with the Issuer, the “Co-Issuers”), and THE BANK OFNEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, a national bankinginstitution, as trustee (herein, together with its permitted successors in the trusts hereunder, the“Trustee”) and as collateral agent (herein, together with its permitted successors in the trusts hereunder, the “Collateral Agent”).
PRELIMINARY STATEMENT
The Co-Issuers are duly authorized to execute and deliver this Indenture and Security Agreement to provide for the Notes issuable as provided in this Indenture and Security Agreement and to secure the Secured DebtRated Notes and other obligations secured under thisIndenture and Security Agreement and the Credit Agreement. Except as otherwise providedherein, all covenants and agreements made by the Co-Issuers herein are for the benefit andsecurity of the Secured Parties. The Co-Issuers are entering into this Indenture and Security Agreement, and the Collateral Agent is accepting the agreements established hereby, and theTrustee is accepting the trusts created hereby, for good and valuable consideration, the receiptand sufficiency of which are hereby acknowledged.
All things necessary to make this Indenture and Security Agreement a validagreement of the Co-Issuers in accordance with the agreement’s terms have been done.
GRANTING CLAUSE
The Issuer hereby Grants to the Collateral AgentTrustee, for the benefit andsecurity of the Holders of the Rated Debt, the Class A Lenders, the Collateral Agent, the Trustee, the Loan AgentNotes, the Income Note Paying Agent, the Administrator, the CollateralAdministrator, the Investment Manager and each Hedge Counterparty (collectively, the “Secured Parties”), all of its right, title and interest in, to and under the following property, in each case,whether now owned or existing, or hereafter acquired or arising, and wherever located, (a) theCollateral Obligations and all payments thereon or with respect thereto, (b) each of the Accounts,to the extent permitted by the applicable Hedge Agreement, each Hedge Counterparty CollateralAccount, any Eligible Investments purchased with funds on deposit therein, and all income fromthe investment of funds therein, (c) the equity interest in any Issuer Subsidiary and all paymentsand rights thereunder, (d) the Issuer’s rights under the Investment Management Agreement as setforth in Article XV hereof, the Credit Agreement, the Hedge Agreements (provided that there isno such Grant to the Collateral AgentTrustee on behalf of any Hedge Counterparty in respect ofits related Hedge Agreement), the Collateral Administration Agreement, the AdministrationAgreement and the Registered Office Agreement, (e) all Cash or Money delivered to theCollateral AgentTrustee (or its bailee) for the benefit of the Secured Parties, (f) all accounts,chattel paper, deposit accounts, financial assets, general intangibles, payment intangibles,instruments, investment property, letter-of-credit rights, securities, money, documents, goods,commercial tort claims and securities entitlements, and other supporting obligations (as such
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terms are defined in the UCC), (g) any other property otherwise delivered to the Collateral AgentTrustee by or on behalf of the Issuer (whether or not constituting Collateral Obligations,Equity Securities or Eligible Investments), and (h) all proceeds (as defined in the UCC) andproducts, in each case, with respect to the foregoing (the assets referred to in (a) through (h) arecollectively referred to as the “Assets”); provided that such Grant shall not include (i) theU.S.$250 transaction fee paid to the Issuer in consideration of the issuance of the Rated Notesand Subordinated Notes and the incurrence of the Class A Loans, (ii) the funds attributable to theissuance and allotment of the Issuer’s ordinary shares, (iii) the bank account in the CaymanIslands in which such funds are deposited (or any interest thereon), and (iv) the membershipinterests of the Co-Issuer (the assets referred to in (i) through (iv), collectively, the “Excepted Property”).
The above Grant is made in trust to secure the Rated DebtNotes and the Issuer’sobligations to the Secured Parties under this Indenture and Security Agreement, the Credit Agreement and each Hedge Agreement. Except as set forth in the Priority of Payments andArticle XIII of this Indenture and Security Agreement, the Rated Debt isNotes are securedequally and ratably without prejudice, priority or distinction between any Rated DebtNotes andany other Rated DebtNotes by reason of difference in time of issuance (or, in the case of the Class A Loans, borrowing) or otherwise, except as expressly provided in this Indenture and Security Agreement, and to secure, in accordance with the priorities set forth in the Priority ofPayments, (i) the payment of all amounts due on the Rated DebtNotes in accordance with theirterms, (ii) the payment of all other sums payable under this Indenture and Security Agreement, the Credit Agreement and all amounts payable under each Hedge Agreement, and (iii)compliance with the provisions of this Indenture and Security Agreement, the Credit Agreement and each Hedge Agreement, all as provided in this Indenture and Security Agreement, the Credit Agreement and each Hedge Agreement, respectively. The foregoing Grant shall, for the purposeof determining the property subject to the lien of this Indenture and Security Agreement, bedeemed to include any securities and any investments granted to the Collateral AgentTrustee byor on behalf of the Issuer, whether or not such securities or investments satisfy the criteria setforth in the definitions of “Collateral Obligation” or “Eligible Investments,” as the case may be.
The Collateral AgentTrustee acknowledges such Grant, accepts the trustshereunder in accordance with the provisions hereof, and agrees to perform its duties expresslystated herein in accordance with the provisions hereof.
ARTICLE I
DEFINITIONS
Definitions. Except as otherwise specified herein or as the contextSection 1.1may otherwise require, the following terms shall have the respective meanings set forth belowfor all purposes of this Indenture and Security Agreement:
“17g-5 Information”: The meaning specified in Section 14.15.
“17g-5 Website”: A password-protected internet website which shall initially belocated at https://www.structuredfn.com. Any change of the 17g-5 Website shall only occur
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after notice has been delivered by the Issuer to the Information Agent, the Collateral Agent, the Loan Agent, the Trustee, the Collateral Administrator, the Investment Manager, the PlacementAgent, and the Rating Agencies setting the date of change and new location of the 17g-5Website.
“Accepted Purchase Request”: The meaning specified in Section 9.9(b).
“Accountants’ Report”: An agreed-upon procedures report of the firm or firmsappointed by the Issuer pursuant to Section 10.8(b). For the avoidance of doubt, notwithstandinganything to the contrary set forth herein, no Accountants’ Report shall be provided to orotherwise shared with any Rating Agency.
“Accounts”: Each of (i) the Payment Account, (ii) the Collection Account, (iii)the Ramp-Up Account, (iv) the Expense Reserve Account, (v) the Interest Reserve Account, (vi)the Custodial Account, (vii) the Unfunded Exposure Account, (viii) the Permitted Use Accountand (viiiix) each Hedge Counterparty Collateral Account (if any).
“Accredited Investor”: An accredited investor as defined in Regulation D underthe Securities Act.
“Act” and “Act of Holders”: The respective meanings specified in Section 14.2.
“Additional DebtNotes”: Any DebtNotes issued and/or incurred pursuant toSection 2.4 or the Credit Agreement.
“Additional DebtNotes Closing Date”: The closing date for the issuance and/or incurrence of any Additional DebtNotes pursuant to Section 2.4 and the Credit Agreement as setforth in an indenture and security agreement supplemental to this Indenture and Security Agreement pursuant to Section 8.1(viii).
“Adjusted Collateral Principal Amount”: As of any date of determination, (a):
the Aggregate Principal Balance of the Collateral Obligations (excluding(a)Defaulted Obligations, Deferring Obligations, Discount Obligations, Specified Extended Collateral Obligations and Collateral and Long Dated Obligations that mature after the Stated Maturity of the Rated Debt), plus (b)
without duplication, the amounts on deposit in the Collection Account(b)representing Principal Proceeds and the Ramp-Up Account (including EligibleInvestments therein), plus (c) for all Defaulted Obligations that have been Defaulted Obligations for less than three years and all
with respect to each Defaulted Obligation and Deferring(c)ObligationsObligation, the Moody’s Collateral Value thereof, plus (d)
with respect to each Discount Obligation, the product (expressed as a(d)dollar amount) of (i) the purchase price of such Discount Obligation (excluding accruedinterest and any syndication or upfront fees paid to the Issuer, but including, at the
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discretion of the Investment Manager, the amount of any related transaction costs(including assignment fees) paid by the Issuer to the seller of the Collateral Obligation orits agent) expressed as a percentage of par multiplied by (ii) the Principal Balance of suchDiscount Obligation, minus (e)
the Excess CCC/Caa Adjustment Amount, plus (f) for(e)
with respect to each CollateralLong Dated Obligation that matures after,(f)the Stated Maturity of the Rated Debt, the Moody’s Collateral Value thereof, plus (g) for each Specified Extended Collateral Obligation, the Moody’s Collateral Value thereof; product of (x) the Principal Balance of such Long Dated Obligation and (y) the applicable liquidation value set forth below:
Difference between (i) the Collateral Obligation’s stated maturity and (ii) the latest Stated Maturity of the Notes
Liquidation value
≤ 6 months 90%> 6 months and ≤ 1 year 80%> 1 year and ≤ 2 years 70%> 2 years or no covenant Moody’s Recovery Rate
provided that with respect to any Collateral Obligation that satisfies more thanone of the definitions under clauses (c) through (gf) above shall, for the purposes of thisdefinition, be treated as belonging to the category of Collateral Obligations which results in thelowest Adjusted Collateral Principal Amount on any date of determination; provided, further,that with respect to any Issuer Subsidiary Asset held by an Issuer Subsidiary, for purposes of thisdefinition and the calculation of any Par Value Ratio, such Issuer Subsidiary Asset will betreated in the same manner as if it were held directly by the Issuer. For the avoidance of doubt,the value of equity warrants attached to any Collateral Obligation shall not constitute part of thePrincipal Balance thereof for purposes of this definition.
“Administration Agreement”: An agreement between the Administrator and theIssuer relating to the various corporate management functions the Administrator will perform onbehalf of the Issuer, including communications with shareholders and the general public, and theprovision of certain clerical, administrative and other services in the Cayman Islands, as suchagreement may be amended, supplemented or varied from time to time.
“Administrative Expense Cap”: An amount equal on any Payment Date (whentaken together with any Administrative Expenses paid in the order of priority contained in thedefinition thereof during the period since the preceding Payment Date or, in the case of the firstPayment Date, the Closing Date) to the sum of (a) 0.0175% per annum (prorated for the relatedInterest Accrual Period on the basis of a 360-day year and the actual number of days elapsed) ofthe Maximum Investment Amount on the Determination Date related to the immediatelypreceding Payment Date (or, for purposes of calculating this clause (a) in connection with thefirst Payment Date, on the Closing Date) and (b) U.S.$ 200,000 per annum (prorated for the
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related Interest Accrual Period on the basis of a 360-day year and the actual number of dayselapsed); provided that, if the amount of Administrative Expenses paid pursuant to Section 11.1(a)(i)(A) (including any excess applied in accordance with this proviso) on the threeimmediately preceding Payment Dates or during the related Collection Periods is less than thestated Administrative Expense Cap (without regard to any excess applied in accordance with thisproviso) in the aggregate for such three preceding Payment Dates, the excess may be applied tothe Administrative Expense Cap with respect to the then-current Payment Date; provided,further, that in respect of each of the first three Payment Dates from the Closing Date, suchexcess amount shall be calculated based on the Payment Dates, if any, preceding such PaymentDate.
“Administrative Expenses”: The fees, expenses (including indemnities as setforth below) and other amounts due or accrued with respect to any Payment Date and payable inthe following order by the Issuer or the Co-Issuer: first, to make any capital contribution to anIssuer Subsidiary necessary to pay any taxes, registered office or governmental fees owing bysuch Issuer Subsidiary, second, to the Trustee, the Collateral Agent, the Loan Agent and theIncome Note Paying Agent (including indemnities) in each of its capacities pursuant hereto, the Credit Agreement, the Income Note Paying Agency Agreement and the other TransactionDocuments, third, to the Collateral Administrator for its fees and expenses (includingindemnities) under the Collateral Administration Agreement, and then fourth, on a pro rata basis(including indemnities) to (i) the Independent accountants, agents (other than the InvestmentManager) and counsel of the Co-Issuers for fees and expenses; (ii) the Rating Agencies for feesand expenses (including amendment and surveillance fees) in connection with any rating of theRated DebtNotes (and in the case of Fitch, the Class A ObligationsNotes only) or in connectionwith the rating of (or provision of credit estimates in respect of) any Collateral Obligations; (iii)the Investment Manager for fees and expenses under this Indenture and Security Agreement, the Credit Agreement and the Investment Management Agreement but excluding the ManagementFees; (iv) the Administrator pursuant to the Administration Agreement and the Registered OfficeAgreement; (v) the Income Note Administrator pursuant to the Income Note AdministrationAgreement and the Income Note Registered Office Agreement; (vi) the independent manager ofthe Co-Issuer for fees and expenses; and [(vii) any other Person in respect of any governmental fee, charge or tax (including without limitation, the fees, expenses and indemnities owing to the Tax Matters Holder as provided for in Section 7.16(c)); and (viii)] any other Person in respect of any other fees or expenses permitted under this Indenture and Security Agreement, the Credit Agreement and the documents delivered pursuant to or in connection with this Indenture and Security Agreement (including expenses incurred in connection with setting up andadministering Issuer Subsidiaries, the payment of facility rating fees and all legal and other feesand expenses incurred in connection with the purchase or sale of any Collateral Obligations andany other expenses incurred in connection with the Collateral Obligations, including anyExcepted Advances and all fees and expenses of the Income Note Issuer payable in accordancewith the Fee Letter), the Credit Agreement and the DebtNotes, including but not limited to,amounts owed to the Co-Issuer pursuant to Section 7.1, any amounts due in respect of the listingof the Notes on any stock exchange or trading system, any costs associated with producingCertificated Notes; provided that (x) amounts due in respect of actions taken on or before theClosing Date shall not be payable as Administrative Expenses but shall be payable only from theExpense Reserve Account pursuant to Section 10.3(d), (y) for the avoidance of doubt, amountsthat are specified as payable under the Priority of Payments that are not specifically identified
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therein as Administrative Expenses (including, without limitation, interest and principal inrespect of the DebtNotes and amounts owing to Hedge Counterparties) shall not constituteAdministrative Expenses and (z) the Investment Manager may direct the payment of RatingAgency fees (only out of amounts available pursuant to clause (b) of the definition of“Administrative Expense Cap”) other than in the order required above, except in the case ofamounts due to the Bank in each of its capacities under the Transaction Documents, if, in theInvestment Manager’s commercially reasonable judgment such payments are necessary to avoidthe withdrawal of any currently assigned rating on any Outstanding Class of Rated DebtNotes.
“Administrator”: MaplesFS Limited.
“Affiliate” or “Affiliated”: With respect to a Person, (a) any other Person who,directly or indirectly, is in control of, or controlled by, or is under common control with, suchPerson or (b) any other Person who is a director, officer or employee (i) of such Person, (ii) ofany subsidiary or parent company of such Person or (iii) of any Person described in clause (a)above; provided that neither the Administrator nor any special purpose entity for which it acts asshare trustee or administrator shall be deemed to be an Affiliate of the Issuer or the Co-Issuersolely because the Administrator or any of its Affiliates serves as administrator or share trusteefor the Issuer or the Co-Issuer. For the purposes of this definition, control of a Person shall meanthe power, direct or indirect, (x) to vote more than 50% of the securities having ordinary votingpower for the election of directors of any such Person or (y) to direct or cause the direction of themanagement and policies of such Person whether by contract or otherwise; provided that nospecial purpose company to which the Investment Manager provides investment advisoryservices will be considered an Affiliate of the Investment Manager, provided, further, that noentity to which the Administrator provides shares trustee and/or administration services,including the provision of directors, will be considered to be an Affiliate of the Issuer solely byreason thereof. For the avoidance of doubt, (x) an Obligor will not be considered an affiliate of any other Obligor solely due to the fact that each such Obligor is under the control of the same financial sponsor and (y) Obligors shall be deemed not to be Affiliates if they have distinct corporate family ratings and/or distinct issuer credit ratings. For purposes of this definition withrespect to the Initial Majority Subordinated Noteholder, the term “Affiliates” shall include anyaccount, fund, client or portfolio established and controlled by the investment advisor of theInitial Majority Subordinated Noteholder or for which such investment advisor or an Affiliate ofsuch investment advisor acts as the investment adviser or exercises discretionary control.
“Agent Members”: Members of, or participants in, DTC, Euroclear orClearstream.
“Aggregate Outstanding Amount”: With respect to any of the Rated DebtNotesas of any date, the aggregate unpaid principal amount of such DebtNotes Outstanding on suchdate. When used with respect to the Subordinated Notes, as of any date, the aggregate principalamount of the Outstanding Subordinated Notes.
“Aggregate Principal Balance”: When used with respect to all or a portion of theCollateral Obligations or the Pledged Obligations, the sum of the Principal Balances of all or ofsuch portion of the Collateral Obligations or Pledged Obligations, respectively.
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“Aggregate Ramp-Up Par Amount”: An amount equal to U.S.$620,000,000.
“Aggregate Ramp-Up Par Condition”: A condition satisfied as of the end of theRamp-Up Period if the Issuer has purchased, or entered into binding commitments to purchase,Collateral Obligations, including Collateral Obligations acquired by the Issuer on or prior to theClosing Date, having an Aggregate Principal Balance that in the aggregate equals or exceeds theAggregate Ramp-Up Par Amount, without regard to prepayments, maturities, redemptions orsales, but only to the extent that the proceeds from such prepayments, maturities, redemptions orsales have not yet been reinvested in additional Collateral Obligations; provided, that thePrincipal Balance of any Defaulted Obligation shall be its Moody’s Collateral Value; provided,further, that sales shall only be disregarded to the extent that such sales account for less than10% of the Aggregate Ramp-Up Par Amount on a par basis.
“AI/QP”: Any Person that, at the time of its acquisition, purported acquisition orproposed acquisition of Notes is both (a) an Accredited Investor and (b) a Qualified Purchaseror, in the case of the Subordinated Notes only, a Knowledgeable Employee with respect to theIssuer or an entity owned exclusively by Qualified Purchasers and/or KnowledgeableEmployees.
“Alternate Base Rate”: The meaning specified in Section 8.1(xxv).
“Amendment Date”: [__], 2017.
“Applicable Issuer” or “Applicable Issuers”: With respect to the RatedDebtNotes, the Issuer or each of the Co-Issuers, as specified in Section 2.3 and with respect tothe Subordinated Notes, the Issuer only.
“Approved Index”: Any of Merrill Lynch High Yield Master II Index, the CSFBHigh Yield II Index or such other nationally recognized index as the Investment Manager selectsand provides notice of to the Rating Agencies.
“Approved Loan Pricing Service”: Any of (a) the Loan Pricing Corporation, Loan X Mark It Partners, FT Interactive, Bridge Information Systems, KDP, IDC or (b) any other nationally recognized loan pricing service selected by the Investment Manager.
“Asset Quality Matrix”: The following chart is used to determine which of the“row/column combinations” (or the linear interpolation between two adjacent rows and/or twoadjacent columns, as applicable) are applicable for purposes of determining compliance with theMoody’s Diversity Test, the Maximum Moody’s Rating Factor Test and the Minimum FloatingSpread Test, as set forth in Section 7.17(e).
Minimum Diversity Score
MinimumWeighted
Average Spread 40[__] 45[__] 50[__] 55[__] 60[__] 65[__] 70[__] 75[__] 80[__]2.65[__]% 1580[__] 1610[__] 1630[__] 1650[__] 1665[__] 1675[__] 1685[__] 1695[__] 1705[__]2.75[__]% 1700[__] 1725[__] 1750[__] 1770[__] 1785[__] 1800[__] 1810[__] 1820[__] 1825[__]2.85[__]% 1820[__] 1840[__] 1860[__] 1880[__] 1900[__] 1915[__] 1925[__] 1935[__] 1945[__]
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Minimum Diversity Score
MinimumWeighted
Average Spread 40[__] 45[__] 50[__] 55[__] 60[__] 65[__] 70[__] 75[__] 80[__]2.95[__]% 1930[__] 1960[__] 1985[__] 2000[__] 2015[__] 2030[__] 2040[__] 2050[__] 2060[__]3.05[__]% 2030[__] 2050[__] 2075[__] 2100[__] 2120[__] 2135[__] 2150[__] 2165[__] 2175[__]3.15[__]% 2150[__] 2170[__] 2190[__] 2210[__] 2230[__] 2250[__] 2265[__] 2280[__] 2290[__]3.25[__]% 2255[__] 2275[__] 2295[__] 2315[__] 2335[__] 2355[__] 2370[__] 2385[__] 2400[__]3.35[__]% 2345[__] 2365[__] 2395[__] 2425[__] 2445[__] 2460[__] 2475[__] 2490[__] 2500[__]3.45[__]% 2440[__] 2465[__] 2505[__] 2530[__] 2560[__] 2590[__] 2610[__] 2630[__] 2645[__]3.55[__]% 2490[__] 2530[__] 2570[__] 2610[__] 2640[__] 2660[__] 2680[__] 2700[__] 2720[__]3.65[__]% 2545[__] 2585[__] 2625[__] 2660[__] 2690[__] 2710[__] 2730[__] 2750[__] 2770[__]3.75[__]% 2595[__] 2635[__] 2675[__] 2710[__] 2740[__] 2770[__] 2790[__] 2810[__] 2825[__]3.85[__]% 2645[__] 2690[__] 2725[__] 2760[__] 2790[__] 2815[__] 2840[__] 2860[__] 2880[__]3.95[__]% 2690[__] 2740[__] 2775[__] 2810[__] 2845[__] 2870[__] 2895[__] 2915[__] 2930[__]4.05[__]% 2740[__] 2790[__] 2830[__] 2865[__] 2895[__] 2920[__] 2945[__] 2965[__] 2985[__]4.15[__]% 2780[__] 2830[__] 2880[__] 2920[__] 2950[__] 2975[__] 2995[__] 3015[__] 3035[__]4.25[__]% 2835[__] 2885[__] 2935[__] 2965[__] 2995[__] 3025[__] 3045[__] 3065[__] 3085[__]4.35[__]% 2885[__] 2935[__] 2980[__] 3010[__] 3040[__] 3070[__] 3090[__] 3110[__] 3130[__]4.45[__]% 2925[__] 2980[__] 3020[__] 3055[__] 3085[__] 3110[__] 3135[__] 3160[__] 3175[__]4.55[__]% 2970[__] 3020[__] 3060[__] 3100[__] 3130[__] 3160[__] 3180[__] 3200[__] 3215[__]4.65[__]% 3015[__] 3065[__] 3105[__] 3140[__] 3175[__] 3195[__] 3215[__] 3235[__] 3255[__]4.75[__]% 3055[__] 3105[__] 3145[__] 3175[__] 3205[__] 3235[__] 3260[__] 3280[__] 3300[__]4.85[__]% 3090[__] 3145[__] 3190[__] 3225[__] 3245[__] 3275[__] 3300[__] 3320[__] 3340[__]4.95[__]% 3120[__] 3195[__] 3225[__] 3265[__] 3300[__] 3325[__] 3345[__] 3365[__] 3380[__]5.05[__]% 3145[__] 3220[__] 3275[__] 3305[__] 3330[__] 3360[__] 3385[__] 3405[__] 3425[__]5.15[__]% 3175[__] 3250[__] 3305[__] 3355[__] 3380[__] 3405[__] 3425[__] 3445[__] 3465[__]5.25[__]% 3205[__] 3270[__] 3340[__] 3390[__] 3420[__] 3450[__] 3470[__] 3490[__] 3510[__]5.35[__]% 3235[__] 3295[__] 3365[__] 3415[__] 3465[__] 3490[__] 3515[__] 3535[__] 3555[__]5.45[__]% 3260[__] 3330[__] 3395[__] 3450[__] 3490[__] 3535[__] 3565[__] 3585[__] 3600[__]5.55[__]% 3285[__] 3360[__] 3425[__] 3480[__] 3520[__] 3560[__] 3590[__] 3610[__] 3625[__]5.65[__]% 3310[__] 3390[__] 3455[__] 3510[__] 3550[__] 3590[__] 3615[__] 3640[__] 3660[__]5.75[__]% 3340[__] 3415[__] 3485[__] 3540[__] 3585[__] 3630[__] 3660[__] 3680[__] 3700[__]5.85[__]% 3365[__] 3440[__] 3510[__] 3575[__] 3625[__] 3670[__] 3695[__] 3720[__] 3740[__]5.95[__]% 3390[__] 3465[__] 3540[__] 3605[__] 3655[__] 3700[__] 3730[__] 3760[__] 3780[__]6.05[__]% 3415[__] 3490[__] 3570[__] 3630[__] 3685[__] 3730[__] 3760[__] 3790[__] 3815[__]
Maximum Moody’s Weighted Average Rating Factor
“Assets”: The meaning assigned in the Granting Clause hereof.
“Assigned Moody’s Rating”: The monitored publicly available rating or theestimated rating expressly assigned to a debt obligation (or facility) by Moody’s that addressesthe full amount of the principal and interest promised.
“Assumed Reinvestment Rate”: The then current rate of interest being paid bythe Bank on time deposits in the Bank having a scheduled maturity of the date prior to the nextPayment Date (as determined on the most recent Interest Determination Date relating to anInterest Accrual Period beginning on a Payment Date or the Closing Date, as applicable).
“Authenticating Agent”: With respect to the Notes, the Person designated by theTrustee to authenticate such Notes on behalf of the Trustee pursuant to Section 6.12.
“Authorized Integrals”: The meaning specified in Section 2.3.
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“Authorized Officer”: With respect to the Issuer or the Co-Issuer, any Officer orany other Person who is authorized to act for the Issuer or the Co-Issuer, as applicable, in mattersrelating to, and binding upon, the Issuer or the Co-Issuer. With respect to the InvestmentManager, any Officer, employee, member or agent of the Investment Manager who is authorizedto act for the Investment Manager in matters relating to, and binding upon, the InvestmentManager with respect to the subject matter of the request, certificate or order in question. Withrespect to the Collateral Administrator, any Officer, employee, partner or agent of the CollateralAdministrator who is authorized to act for the Collateral Administrator in matters relating to, andbinding upon, the Collateral Administrator with respect to the subject matter of the request,certificate or order in question. With respect to the Trustee (or any other bank or trust companyacting as trustee of an express trust or as custodian), the Collateral Agent or the Loan Agent, aBank Officer. With respect to any Authenticating Agent, any Officer of such AuthenticatingAgent who is authorized to authenticate the Notes. Each party may receive and accept acertification of the authority of any other party as conclusive evidence of the authority of anyperson to act, and such certification may be considered as in full force and effect until receipt bysuch other party of written notice to the contrary.
“Average Life”: On any date of determination with respect to any CollateralObligation, the quotient obtained by dividing (i) the sum of the products of (a) the number ofyears (rounded to the nearest one hundredth thereof) from such date of determination to therespective dates of each successive Scheduled Distribution of principal of such CollateralObligation and (b) the respective amounts of principal of such Scheduled Distributions by (ii) thesum of all successive Scheduled Distributions of principal on such Collateral Obligation; provided that, if the aggregate outstanding principal balance of the Collateral Obligations (excluding any Defaulted Obligations) exceeds the Reinvestment Target Par Balance, the Collateral Obligations included in the calculation of this test shall be only those Collateral Obligations with an aggregate outstanding principal balance equal to the Reinvestment Target Par Balance (starting with Collateral Obligations with the shortest Average Lives)..
“Balance”: On any date, with respect to Cash or Eligible Investments in anyAccount, the aggregate (i) current balance of Cash, demand deposits, time deposits, certificatesof deposit and federal funds; (ii) principal amount of interest-bearing corporate and governmentsecurities, money market accounts and repurchase obligations; and (iii) purchase price (but notgreater than the face amount) of non-interest-bearing government and corporate securities andcommercial paper.
“Bank”: The Bank of New York Mellon Trust Company, National Association, anational banking institution, in its individual capacity and not as Trustee, Collateral Agent, Income Note Paying Agent or Loan Agent, and any successor thereto.
“Bankruptcy Exchange”: The exchange of a Defaulted Obligation (without the payment of any additional funds other than reasonable and customary transfer costs) for another debt obligation issued by another Obligor which, but for the fact that such debt obligation is a Defaulted Obligation or a Credit Risk Obligation, would otherwise qualify as a Collateral Obligation and (i) in the Investment Manager’s reasonable business judgment, at the time of the exchange, such debt obligation received on exchange has a better likelihood of recovery than the
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Defaulted Obligation to be exchanged, (ii) as determined by the Investment Manager, at the time of the exchange, the debt obligation received on exchange is no less senior in right of payment vis-à-vis such Obligor’s other outstanding indebtedness than the Defaulted Obligation to be exchanged vis-à-vis its Obligor’s other outstanding indebtedness, (iii) as determined by the Investment Manager, both prior to and after giving effect to such exchange, each of the Coverage Tests is satisfied or, if any Coverage Test was not satisfied prior to such exchange, the coverage ratio relating to such test will be at least as close to being satisfied after giving effect to such exchange as it was before giving effect to such exchange, (iv) as determined by the Investment Manager, both prior to and after giving effect to such exchange, not more than 15.0% of the Collateral Principal Amount consists of obligations received in a Bankruptcy Exchange, (v) the period for which the Issuer held the Defaulted Obligation to be exchanged will be included for all purposes in this Indenture when determining the period for which the Issuer holds the debt obligation received on exchange, (vi) the Bankruptcy Exchange Test is satisfied, (vii) such exchanged Defaulted Obligation was not acquired in a Bankruptcy Exchange and (viii) obligations received in a Bankruptcy Exchange in the aggregate since the Amendment Date do not constitute more than 25.0% of the Aggregate Ramp-Up Par Amount.
“Bankruptcy Exchange Test”: A test that is satisfied if, in the Investment Manager’s reasonable business judgment, the projected internal rate of return of the obligation obtained as a result of a Bankruptcy Exchange is greater than the projected internal rate of return of the Defaulted Obligation exchanged in a Bankruptcy Exchange, calculated by the Investment Manager by aggregating all cash and the Market Value of any Collateral Obligation subject to a Bankruptcy Exchange at the time of each Bankruptcy Exchange.
“Bank Officer”: When used with respect to the Trustee, the Loan Agent or the Collateral Agent, any officer within the Corporate Office (or any successor group of the Trustee, the Loan Agent or the Collateral Agent) including any vice president, assistant vice president orofficer of the Trustee, the Loan Agent or the Collateral Agent customarily performing functionssimilar to those performed by the persons who at the time shall be such officers, respectively, orto whom any corporate trust matter is referred at the Corporate Office because of such person’sknowledge of and familiarity with the particular subject and in each case having directresponsibility for the administration of this Indenture and Security Agreement.
“Bankruptcy Law”: The federal Bankruptcy Code, Title 11 of the United StatesCode, as amended from time to time, Part V of the Companies Law (20132016 Revision) of theCayman Islands, the Bankruptcy Law (20132016 Revision) of the Cayman Islands, as amendedfrom time to time and the Foreign Bankruptcy Proceedings (International Cooperation) Rules2008 of the Cayman Islands, as amended from time to time.
“Base Rate Amendment”: The meaning specified in Section 8.1(xxv).
“Benefit Plan Investor”: (a) Any “employee benefit plan” (as defined in Section3(3) of Title I of ERISA) that is subject to the fiduciary responsibility provisions of Title I ofERISA, (b) any “plan” as defined in Section 4975(e) of the Code that is subject to Section 4975of the Code, or (c) any entity whose underlying assets include “plan assets” (within the meaningof 29 C.F.R. §2510.3-101 as modified by Section 3(42) of ERISA) by reason of any suchemployee benefit plan’s or plan’s investment in the entity, or otherwise.
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“Bid Disqualification Condition”: With respect to a Firm Bid or a dealer in respect thereof, (1) either (x) such dealer is ineligible to accept assignment or transfer of such Collateral Obligation or (y) such dealer would not, through the exercise of its commercially reasonable efforts, be able to obtain any consent required under any agreement or instrument governing or otherwise relating to such Collateral Obligation to the assignment or transfer of such Collateral Obligation to it; or (2) such Firm Bid is not bona fide, including, without limitation, due to (x) the insolvency of the dealer or (y) the inability, failure or refusal of the dealer to settle the purchase of such Collateral Obligation or otherwise settle transactions in the relevant market or perform its obligations generally.
“Board of Directors”: With respect to the Issuer, the directors of the Issuer dulyappointed by the shareholders of the Issuer or the board of directors of the Issuer pursuant to thecurrent articles of association of the Issuer, and with respect to the Co-Issuer, the managers ofthe Co-Issuer duly appointed by the members of the Co-Issuer.
“Board Resolution”: With respect to the Issuer, a duly passed resolution of theBoard of Directors of the Issuer and, with respect to the Co-Issuer, an action in writing by thesole member of the Co-Issuer.
“Bond”: Either a Senior Secured Bond, a High-Yield Bond or another debtsecurity.
“Bridge Loan”: Any obligation or debt security incurred or issued in connectionwith a merger, acquisition, consolidation, sale of all or substantially all of the assets of a Person,restructuring or similar transaction, which obligation or security by its terms is required to berepaid within one year of the incurrence thereof with proceeds from additional borrowings orother refinancings (other than any additional borrowing or refinancing if one or more financialinstitutions has provided the issuer of such obligation or security with a binding writtencommitment to provide the same, so long as (i) such commitment is equal to the outstandingprincipal amount of the Bridge Loan and (ii) such committed replacement facility has a maturityof at least one year and cannot be extended beyond such one year maturity pursuant to the termsthereof).
“Business Day”: Any day other than (i) a Saturday or a Sunday or (ii) a day onwhich commercial banks are authorized or required by applicable law, regulation or executiveorder to close in New York, New York, Chicago Illinois or in the city in which the CorporateOffice of any of the Trustee, the Loan Agent or the Collateral Agent is located or, for any finalpayment of principal, in the relevant place of presentation.
“Caa Collateral Obligation”: A Collateral Obligation (other than a DefaultedObligation) with, a Discount Obligation, a Current Pay Obligation or a Deferring Obligation) with (x) a Moody’s Default Probability Rating of “Caa1” or lower and (y) a Market Value below 100%.
“Caa Excess”: The excess, if any, of the Aggregate Principal Balance of all CaaCollateral Obligations over 7.5% of the Collateral Principal Amount as of the current
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Measurement Date; provided, that in determining which of the Collateral Obligations will beincluded in the Caa Excess, the Collateral Obligations with the lowest Market Value expressedas a percentage of par will be deemed to constitute such Caa Excess.
“Calculation Agent”: The meaning specified in Section 7.15(a).
“Cash”: Such coin or currency of the United States of America as at the timeshall be legal tender for payment of all public and private debts.
“CCC Collateral Obligation”: A Collateral Obligation (other than a Defaulted Obligation) with an S&P Rating of “CCC+” or lower.Cayman FATCA Legislation”: The Cayman Islands Tax Information Authority Law (2017 Revision) (as amended) together with regulations and guidance notes made pursuant to such law.
“CCC Excess”: The excess, if any, of the Aggregate Principal Balance of all CCC Collateral Obligations over 7.5% of the Collateral Principal Amount as of the current Measurement Date; provided, that in determining which of the Collateral Obligations will be included in the CCC Excess, the Collateral Obligations with the lowest Market Value expressed as a percentage of par will be deemed to constitute such CCC Excess.
“CCC/Caa Collateral Obligation”: Any Collateral Obligation (without duplication) that is either a Caa Collateral Obligation or a CCC Collateral Obligation, as the context requires.
“Certificate of Authentication”: The meaning specified in Section 2.1.
“Certificated Notes”: Collectively, the Certificated Rated Notes and theCertificated Subordinated Notes.
“Certificated Rated Note”: The meaning specified in Section 2.2(b).
“Certificated Securities”: The meaning specified in Section 8-102(a)(4) of theUCC.
“Certificated Subordinated Note”: The meaning specified in Section 2.2(b)(ii).
“Class”: In the case of (a) the Rated Notes, all of the Rated Notes having thesame Debt Interest Rate, Stated Maturity and designation, (b) the Class A Loans, all of the Class A Loans, (c) the Subordinated Notes, all of the Subordinated Notes or (d) the Debt, all or any of the Rated Notes, the Class A Loans and the Subordinated Notes, as the context may require; provided, that for purposes of any vote, request, demand, authorization, direction, notice, consent, waiver, objection or similar action under the Indenture and Security Agreement, the Investment Management Agreement or any other Transaction Document, (i) the Class A-1 Notes, the Class A-2 Notes and the Class A Loans shall constitute a single Class (except (x) the Class A-1 Notes, the Class A-2 Notes and the Class A Loans shall vote separately by Class in connection with any supplemental indenture and security agreement that affects either such Class exclusively or differently from the Holders of the other Class and (y) the Class A-2 Notes shall be treated as a separate Class with respect to a Redemption by Refinancing or a Re-Pricing), (ii)
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the Class B-1 Notes and the Class B-2 Notes shall constitute a single Class (except (x) the Class B-1 Notes and the Class B-2 Notes shall vote separately by Class in connection with any supplemental indenture and security agreement that affects either such Class exclusively or differently from the Holders of the other Class and (y) the Class B-1 Notes and the Class B-2 Notes shall be treated as a separate Class with respect to a Redemption by Refinancing or a Re-Pricing), and (iii) the Class C-1 Notes and the Class C-2 Notes shall constitute a single Class (except (x) the Class C-1 Notes and the Class C-2 Notes shall vote separately by Class in connection with any supplemental indenture and security agreement that affects either such Class exclusively or differently from the Holders of the other Class and (y) the Class C-1 Notes and the Class C-2 Notes shall be treated as a separate Class with respect to a Redemption by Refinancing or a Re-Pricing). Interest Rate, Stated Maturity and designation and (b) the Subordinated Notes, all of the Subordinated Notes; provided, that additional notes of an existing Class of Notes issued as described pursuant to Section 2.4 shall comprise the same Class of such existing Class notwithstanding the fact that such additional notes may be issued with a spread over LIBOR or fixed interest rate, as applicable, that is not identical to that of the initial Notes of such Class.
“Class A Lenders”: The lenders from time to time party to the Credit Agreement.
“Class A Loans”: The Class A Loans issued pursuant to the Credit Agreement.
“Class A Notes”: ThePrior to the Amendment Date, the Class A-1 Senior Secured Floating Rate Notes and the Class A-2 Senior Secured Floating Rate Notes issued on the Closing Date, collectively, and, on and after the Amendment Date, the Class A-R Notes.
“Class A-1R Notes”: The Class A-1R Senior Secured Floating Rate Notes issuedpursuant to this Indenture and Security Agreement and having the characteristics specified inSection 2.3.
“Class A-2 Notes”: The Class A-2 Senior Secured Floating Rate Notes issued pursuant to this Indenture and Security Agreement and having the characteristics specified in Section 2.3.
“Class A Obligations”: Collectively, the Class A-1 Notes, the Class A-2 Notes and the Class A Loans.
“Class A/B Coverage Tests”: The Par Value Ratio Test and the Interest CoverageTest, each as applied with respect to the Class A ObligationsNotes and the Class B Notescollectively. For purposes of the Class A/B Coverage Test, the Class A-1 Notes, the Class A-2 Notes and the Class A Loans shall be treated as one Class
“Class B Notes”: ThePrior to the Amendment Date, the Class B-1 Senior Secured Floating Rate Notes and the Class B-2 Senior Secured Fixed Rate Notes issued on the Closing Date, collectively, and, on and after the Amendment Date, the Class B-R Notes.
“Class B-1R Notes”: The Class B-1R Senior Secured Floating Rate Notes issuedpursuant to this Indenture and Security Agreement and having the characteristics specified in Section 2.3.“Class B-2 Notes”: The Class B-2 Senior Secured Floating Rate Notes issued
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pursuant to this Indenture and Security Agreement and having the characteristics specified inSection 2.3.
“Class C Coverage Tests”: The Par Value Ratio Test and the Interest CoverageTest, each as applied with respect to the Class C Notes.
“Class C Notes”: ThePrior to the Amendment Date, the Class C-1 Secured Deferrable Floating Rate Notes and the Class C-2 Secured Deferrable Floating Rate Notes issued on the Closing Date and, on and after the Amendment Date, the Class C-R Notes.
“Class C-1R Notes”: The Class C-1R Secured Deferrable Floating Rate Notesissued pursuant to this Indenture and Security Agreement and having the characteristics specified in Section 2.3.“Class C-2 Notes”: The Class C-2 Secured Deferrable Floating Rate Notes issued pursuant to this Indenture and Security Agreement and having the characteristics specified inSection 2.3.
“Class D Coverage Tests”: The Par Value Ratio Test and the Interest CoverageTest, each as applied with respect to the Class D Notes.
“Class D Notes”: Prior to the Amendment Date, the Class D Secured Deferrable Floating Rate Notes issued on the Closing Date and, on and after the Amendment Date, the Class D-R Notes.
“Class D-R Notes”: The Class D-R Secured Deferrable Floating Rate Notesissued pursuant to this Indenture and Security Agreement and having the characteristics specifiedin Section 2.3.
“Class E Coverage Test”: The Par Value Ratio Test as applied with respect to theClass E Notes.
“Class E Notes”: Prior to the Amendment Date, the Class E Secured Deferrable Floating Rate Notes issued on the Closing Date and, on and after the Amendment Date, the Class E-R Notes.
“Class E-R Notes”: The Class E-R Secured Deferrable Floating Rate Notesissued pursuant to this Indenture and Security Agreement and having the characteristics specifiedin Section 2.3.
“Class F Notes”: Prior to the Amendment Date, the Class F Secured Deferrable Floating Rate Notes issued on the Closing Date and, on and after the Amendment Date, the Class F-R Notes.
“Class F-R Notes”: The Class F-R Secured Deferrable Floating Rate Notesissued pursuant to this Indenture and Security Agreement and having the characteristics specifiedin Section 2.3.
“Class X Notes”: The Class X Senior Secured Floating Rate Notes issued pursuant to this Indenture and having the characteristics specified in Section 2.3.
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“Class X Principal Amortization Amount”: For each Payment Date beginning with the Payment Date occurring in [__] and ending with the Payment Date occurring in [__], the lesser of (1) the remaining Aggregate Outstanding Amount of the Class X Notes and (2) $[__].
“Clean-Up Call Purchase Price”: The meaning specified in Section 9.8(b) hereof.
“Clean-Up Call Redemption”: The meaning specified in Section 9.8 hereof.
“Clearing Agency”: An organization registered as a “clearing agency” pursuantto Section 17A of the Exchange Act.
“Clearing Corporation”: Each of (i) Clearstream, (ii) DTC, (iii) Euroclear and(iv) any entity included within the meaning of “clearing corporation” under Section 8-102(a)(5)of the UCC.
“Clearing Corporation Security”: Securities which are in the custody of ormaintained on the books of a Clearing Corporation or a nominee subject to the control of aClearing Corporation and, if they are Certificated Securities in registered form, properlyendorsed to or registered in the name of the Clearing Corporation or such nominee.
“Clearstream”: Clearstream Banking, société anonyme.
“Closing Date”: August 21, 2014.
“Code”: The United States Internal Revenue Code of 1986, as amended fromtime to time, and the Treasury regulations promulgated thereunder.
“Co-Issuer”: THL Credit Wind River 2014-2 CLO LLC, until a successor Personshall have become the Co-Issuer pursuant to the applicable provisions of this Indenture and Security Agreement, and thereafter “Co-Issuer” shall mean such successor Person.
“Co-Issuers”: The Issuer and the Co-Issuer.
“Collateral Administration Agreement”: An agreement dated as of the ClosingDate among the Issuer, the Investment Manager and the Collateral Administrator, as amendedfrom time to time, in accordance with the terms thereof.
“Collateral Administrator”: The Bank, in its capacity as such under the CollateralAdministration Agreement, and any successor thereto.
“Collateral Agent”: As defined in the first sentence of this Indenture and Security Agreement and any successor thereto.
“Collateral Interest Amount”: As of any date of determination, withoutduplication, the aggregate amount of Interest Proceeds that has been received or that is expectedto be received (other than Interest Proceeds expected to be received from Defaulted Obligationsor Deferrable Obligations, but including Interest Proceeds actually received from Defaulted
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Obligations or Deferrable Obligations (each in accordance with the definition of “InterestProceeds”)), in each case during the Collection Period in which such date of determinationoccurs (or after such Collection Period but on or prior to the related Payment Date if suchInterest Proceeds would be treated as Interest Proceeds with respect to such Collection Period).
“Collateral Obligation”: A debt obligation that or Participation Interest that as of the date the Issuer commits to acquire:
is a Senior Secured Loan, Second Lien Loan or Unsecured Loan or (i)a Participation Interest therein that as of the date the Issuer commits to acquire:, if the Permitted Securities Condition has been satisfied, a Senior Secured Bond, a High-Yield Bond or a Senior Secured Note;
(i) is U.S. Dollar denominated and is not convertible by (a) the(ii)Issuer or (b) the Obligor of such Collateral Obligation into, nor payable in, anyother currency, with any payments under such Collateral Obligation to be madeonly in U.S. Dollars;
(ii) is not a Defaulted Obligation or a Credit Risk Obligation (iii)(unless such obligation is a DIP Collateral Obligation or is being acquired in connection with a Bankruptcy Exchange);
(iii) is not a Bridge Loan, a Letter of Credit Reimbursement(iv)Obligation, a Bond (including any Senior Secured Bond,an Unsecured Bond, High-Yield Bond, or a Zero-Coupon Security), or a Senior Secured Floating Rate Note;
(iv) is not a lease (including a financing lease) or an obligation to(v)pay rent or other amounts under any lease of (or other arrangement conveying theright to use) real or personal property, or a combination thereof;
(v) is not a Structured Finance Obligation;(vi)
(vi) is not a Deferring Obligation;(vii)
(vii) provides for a fixed amount of principal payable on scheduled(viii)payment dates and/or at maturity and does not by its terms provide for earlieramortization or prepayment at a price of less than par;
(viii) does not pay scheduled interest less frequently than(ix)semi-annually;
(ix) does not constitute Margin Stock;(x)
(x) has only payments that do not and will not subject the Issuer or(xi)the relevant Issuer Subsidiary to withholding tax or other similar tax (other thanwithholding or other similar taxes on commitment fees, letter of credit fees, orsimilar fees or fees that by their nature are commitment fees or similar fees, and
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withholding tax imposed under FATCA) unless the related Obligor is required tomake “gross-up” payments that ensure that the net amount actually received bythe Issuer or the relevant Issuer Subsidiary (after payment of all taxes, whetherimposed on such Obligor, the Issuer or the relevant Issuer Subsidiary) will equalthe full amount that the Issuer or the relevant Issuer Subsidiary would havereceived had no such taxes been imposed;
(xi) has both a Moody’s Rating of at least “Caa3” and an S&P (xii)Rating of at least “CCC-”(unless such obligation is a DIP Collateral Obligation or is being acquired in connection with a Bankruptcy Exchange);
(xii) is not a debt obligation whose repayment is subject to(xiii)substantial non-credit related risk as determined by the Investment Manager;
(xiii) does not have an “f,” “r,” “p,” “pi,” “q,” “sf” or “t” subscript(xiv)assigned by S&P or an “sf” subscript assigned by Moody’s;
(xiv) will not require the Issuer, the Co-Issuer or the pool of Assets(xv)to be registered as an investment company under the Investment Company Act;
(xv) is not subject to a tender offer, voluntary redemption,(xvi)exchange offer, conversion or other similar action for a price less than itsoutstanding Principal Balance plus all accrued and unpaid interest;
(xvi) is not issued by an Emerging Market Obligor;(xvii)
(xvii) is not a Zero-Coupon Security or a Related Obligation (xviii)(unless the prorated share of all fees associated with such Related Obligation are included as a discounted purchase price);[reserved];
(xviii) is not a Synthetic Security;(xix)
(xix) is in registered form for U.S. federal income tax purposes;(xx)
(xx) is not (A) an Equity Security or (B) by its terms convertible(xxi)into or exchangeable for an Equity Security, in each case other than an EquitySecurity received by the Issuer as a result of a restructuring of an asset alreadyowned by the Issuer that would be considered “received in lieu of debtspreviously contracted for with respect to” the Collateral Obligation under theVolcker Rule;
(xxi) does not mature after the Stated Maturity of the Rated Debt (xxii)(other thanis not a Long Dated Obligation (unless it was acquired as a result of arestructuring of a Collateral Obligation already owned by the Issuer immediately prior to such restructuring to which the Investment Manager (on behalf of theIssuer) either (a) did not consent or (b) consented but only because suchrestructuring was, in the commercially reasonable business judgment of theInvestment Manager, either (1) necessary in order to avoid bankruptcy or
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insolvency of the related Obligor and such restructuring required the consent of100% of the lenders thereto or (2) in connection with the bankruptcy orinsolvency of the related Obligor);
(xxii) other than DIP Collateral Obligations, is not a debt(xxiii)obligation in respect of which the total potential indebtedness of its Obligor underall loan agreements, indentures and other instruments governing suchobligorObligor’s indebtedness (whether drawn or undrawn) is less thanU.S.$150,000,000125,000,000 (other than a Collateral Obligation received by theIssuer as a result of a restructuring of an asset already owned by the Issuer);(xxiii)will not, by its acquisition, cause the Issuer to violate the Tax Guidelines; and
is not an obligation or security that does not provide in the related(xxiv)Underlying Instruments for the payment or repayment of a stated principalamount in one or more installments on or prior to its stated maturity.
“Collateral Obligation Maturity”: With respect to any Collateral Obligation, (x) the date on which such Collateral Obligation shall be deemed to mature (or its maturity date), which shall be the stated maturity of such Collateral Obligation or (y) if the Issuer has the right to require the issuer or obligor of such Collateral Obligation to purchase, redeem or retire such Collateral Obligation (at or above par) on any one or more dates prior to its stated maturity (a “put right”) and the Invesment Manager certifies to the Trustee that it has excercised such put right with respect to any such date, the maturity date shall be the date specified in such certification.
“Collateral Principal Amount”: As of any date of determination, the sum of (a) theAggregate Principal Balance of the Collateral Obligations and (b) without duplication, theamounts on deposit in the Collection Account representing Principal Proceeds and the Ramp-UpAccount (including Eligible Investments therein).
“Collection Account”: Collectively, the Interest Collection Subaccount and thePrincipal Collection Subaccount.
“Collection Period”: With respect to any Payment Date, the period commencingimmediately following the prior Collection Period (or on the Closing Date, in the case of theCollection Period relating to the first Payment Date) and ending on the day that is six (6)Business Days prior to (but excluding) the Payment Date; provided that (i) the final CollectionPeriod preceding the latest Stated Maturity of any Class of DebtNotes shall commenceimmediately following the prior Collection Period and end on such Stated Maturity, (ii) the finalCollection Period preceding an Optional Redemption (other than in connection with a Redemption by Refinancing) or a Clean-Up Call Redemption in whole of the Rated DebtNotesshall commence immediately following the prior Collection Period and end on the RedemptionDate, and (iii) with respect to Refinancing Proceeds and Partial Redemption Interest Proceeds only, the final Collection Period preceding the Refinancing of any Class of Rated DebtNotesshall commence immediately following the prior Collection Period and end on the RedemptionDate; provided, further, that with respect to any Payment Date and any amounts payable to theIssuer under a Hedge Agreement, the Collection Period will commence on the day after the priorPayment Date and end on such Payment Date.
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“Concentration Limitations”: Limitations satisfied, if as of any date ofdetermination at or subsequent to, the end of the Ramp-Up Period, in the aggregate, theCollateral Obligations owned (or in relation to a proposed purchase of a Collateral Obligation,proposed to be owned) by the Issuer comply with all of the requirements set forth below,calculated in each case as required by Section 1.2 (or, if not in compliance at the time ofreinvestment, the relevant requirements must be maintained or improved).
no more than the percentage listed below of the Collateral(i)Principal Amount may be issued by obligors Domiciled in the country orcountries set forth opposite such percentage:
% Limit Country or Countries
20.0%All Group Countries, Tax Advantaged Jurisdictions (each inthe aggregate) and Canada other than the United States;
15.0% Canada;10.0% United Kingdom;15.0% All Group I Countries in the aggregate;10.0% Any individual Group I Country;10.0% All Group II Countries in the aggregate;5.0% Any individual Group II Country;7.510.0% All Group III Countries in the aggregate;5.0% Any individual Group III Country;7.5% All Tax Advantaged Jurisdictions in the aggregate; and0.0% Portugal, Italy, Spain and Greece;
with respect to any Participation Interest, the Moody’s(ii)Counterparty Criteria are met;
not less than 90.0% of the Collateral Principal Amount may consist(iii)of Collateral Obligations that are Senior Secured Loans and Eligible Investmentsrepresenting Principal Proceeds;
not more than 10.0% of the Collateral Principal Amount may(iv)consist of Collateral Obligations that are Second Lien Loans or Senior Unsecured Loans, Senior Secured Bonds, High-Yield Bonds and Senior Secured Notes; provided that notwithstanding the foregoing, unless the Permitted Securities Condition has been satisfied, no portion of the Collateral Principal Amount may consist of Collateral Obligations that are Senior Secured Bonds, High-Yield Bonds or Senior Secured Notes;
not more than 10.0% of the Collateral Principal Amount may(v)consist of fixed rate Collateral Obligations;
not more than 20.0% of the Collateral Principal Amount may(vi)consist of Participation Interests;
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not more than 7.5% of the Collateral Principal Amount may(vii)consist of DIP Collateral Obligations;
not more than 2.0% of the Collateral Principal Amount may(viii)consist of Collateral Obligationsobligations issued by a single obligorObligor,except that Collateral Obligationsobligations issued by up to five (5) obligorsObligors may each constitute up to 2.5% of the Collateral PrincipalAmount; provided that notwithstanding this clause (viii), not more than 1.5% of the Collateral Principal Amount may consist of Collateral Obligations other than Senior Secured Loans issued by a single obligor.
not more than 12.011.0% of the Collateral Principal Amount may(ix)consist of obligations in the same S&P Industry Classification group, except that(x) Collateral Obligations in up to one (1)three S&P Industry Classificationgroups may each constitute up to 13.5% of the Collateral Principal Amount and (y) Collateral Obligations in one S&P Industry Classification group mayconstitute up to 15.0% of the Collateral Principal Amount;
notno more than 7.5% of the Collateral Principal Amount may(x)consist of CCC Collateral Obligations and not more than 7.5% of the Collateral Principal Amount may consist ofthat are Caa Collateral Obligations as of the date of acquisition;
not more than 10.0% of the Collateral Principal Amount may(xi)consist of Collateral Obligations that pay interest less frequently than quarterly;
not more than 60.070.0% of the Collateral Principal Amount may(xii)consist of Cov-Lite Loans;
not more than 2.55.0% of the Collateral Principal Amount may(xiii)consist of Deferrable Obligations that are not Purposely Deferring Obligations;
not more than 10.0% of the Collateral Principal Amount may(xiv)consist of Revolving Collateral Obligations and the unfunded portion of anyDelayed Drawdown Collateral Obligations and Revolving Collateral Obligations;
not more than 10.0% of the Collateral Principal Amount may(xv)consist of Collateral Obligations of any obligor in which at least 25% of any class of such obligor’s outstanding equity is owned by the Investment Manager, an Affiliate thereof, or an account, fund, client or portfolio established and controlled by the Investment Manager or an Affiliate thereof; anddebt obligations in respect of which the total potential indebtedness (whether drawn or undrawn) of its obligor under all loan agreements, indentures and other instruments governing such obligor’s indebtedness is greater than or equal to U.S.$125,000,000 but less than U.S.$250,000,000 as of the date of acquisition (other than a Collateral Obligation received by the Issuer as a result of a restructuring of an asset already owned by the Issuer);
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not more than 5.0% of the Collateral Principal Amount may(xvi)consist of Current Pay Obligations; and
not more than 2.0% of the Collateral Principal Amount may (xvii)consist of Long Dated Obligations.
“Confidential Information”: The meaning specified in Section 14.13(b).
“Consenting Holder”: The meaning specified in Section 14.13(b).
“Contribution”: The meaning specified in Section 10.3(g).
“Contribution Notice”: With respect to a Contribution, the notice, substantially in the form of Exhibit E, provided by a Contributor to the Trustee, the Issuer and the Investment Manager (a) containing the following information: (i) information evidencing the Contributor’s beneficial ownership of Subordinated Notes, (ii) the amount of such Contribution, (iii) whether such Contribution (or portion thereof) is a Cure Contribution, (iv) the Payment Date on which such Contribution shall be repaid to the Contributor, (v) the rate of return applicable to such Contribution, (vi) the Contributors’ contact information and (vii) payment instructions for the payment of Contribution Repayment Amounts (together with any information reasonably requested by the Trustee or the Paying Agent) and (b) attaching, (i) in the case of a Cure Contribution, the consent of a Majority of the Subordinated Notes to the making of such Cure Contribution, such Payment Date and rate of return (unless the related Contributor is a holder of a Majority of the Subordinated Notes) and (ii) in the case of any Contribution (other than a Cure Contribution), the consent of a Majority of the Subordinated Notes and the Investment Manager to the making of such Contribution, such Payment Date and rate of return.
“Contribution Participation Notice”: With respect to an election to participate in a Contribution on a pro rata basis, the notice, substantially in the form of Exhibit G, provided by a Contributor electing to so participate to the Trustee and the Investment Manager containing the following information: (i) information evidencing the Contributor’s beneficial ownership of Subordinated Notes, (ii) the Contributor’s contact information and (iii) payment instructions for the payment of Contribution Repayment Amounts (together with any information reasonably requested by the Trustee or the Paying Agent).
“Contribution Repayment Amount”: The meaning specified in Section 10.3(g).
“Contributor”: The meaning specified in Section 10.3(g).
“Controlling Class”: The Class A ObligationsNotes so long as any Class AObligationsNotes are Outstanding; then the Class B Notes so long as any Class B Notes areOutstanding; then the Class C Notes so long as any Class C Notes are Outstanding; then theClass D Notes so long as any Class D Notes are Outstanding; then the Class E Notes so long asany Class E Notes are Outstanding; then the Class F Notes so long as any Class F Notes areOutstanding; then the Subordinated Notes if no Rated Debt isNotes are Outstanding. The Class X Notes will not constitute the Controlling Class at any time.
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“Controlling Person”: A Person (other than a Benefit Plan Investor) who hasdiscretionary authority or control with respect to the assets of the Issuer or any Person whoprovides investment advice for a fee (direct or indirect) with respect to such assets, or anyaffiliate of such a Person.
“Conversion Option”: The option of a Converting Lender to convert all or a portion of Class A Loans into an equivalent principal amount of Class A-1 Notes pursuant to Section 3.7 of the Credit Agreement and Section 2.14 hereof.
“Converting Lender”: A Class A Lender that exercises its Conversion Option.
“Corporate Office”: The corporate trust office of the Trustee, the Loan Agent and the Collateral Agent, currently located at The Bank of New York Mellon Trust Company, 601Travis Street, 16th Floor, Houston, Texas 77002, Attention: Global Corporate Trust – THLCredit Wind River 2014-2 CLO Ltd., telecopy no.: (713) 483-6001 or, in each case, such otheraddress as the Trustee or Collateral Agent may designate from time to time by notice to theHolders, the Investment Manager and the Issuer or the principal corporate trust office of anysuccessor Trustee or Collateral Agent.
“Cov-Lite Loan”: A senior secured loan that: (a) does not (a) contain anyfinancial covenants; or (b) requires the underlying obligor to comply with one or more Incurrence Covenants, but does not or (b) require the underlying obligorObligor to comply withaany Maintenance Covenant; provided that a loan described in clause (a) or (b) above whichcontains either a cross default provision to, or is pari passu with, another loan of the underlyingobligorObligor forming part of the same loan facility that requires the underlying obligor tocomply with a Maintenance Covenant shall be deemed not to be a Cov-Lite Loan. For the avoidance of doubt, a loan that is capable of being described in clause (a) or (b) above only (x) until the expiration of a certain period of time after the initial issuance thereof or (y) for so long as there is no funded balance in respect thereof, in each case, as set forth in the related Underlying Instruments, shall be deemed not to be a Cov-Lite Loan.
“Coverage Tests”: The Class A/B Coverage Tests, the Class C Coverage Tests,the Class D Coverage Tests and the Class E Coverage Test.
“Credit Agreement”: That certain credit agreement, dated as of the Closing Date, among the Issuer, as borrower, the Class A Lenders, the Bank, as loan agent and the Collateral Agent, pursuant to which the Class A Lenders will agree to make the Class A Loans to the Issuer.Amendment”: An amendment, waiver or other modification that, in the Investment Manager’s judgment is necessary (i) to prevent the related Collateral Obligation from becoming a Defaulted Obligation, (ii) due to the materially adverse financial condition of the related obligor, to minimize losses on the related Collateral Obligation or (iii) in connection with an insolvency, bankruptcy, reorganization, financial distress or work out of the obligor thereof.
“Credit Improved Obligation”:
So long as a Restricted Trading Period is not in effect, any Collateral(a)Obligation that in the Investment Manager’s commercially reasonable business judgment
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has significantly improved in credit quality from the condition of its credit at the time ofpurchase which improvement may (but need not) be based on one or more of thefollowing facts:
it has a market price that is greater than the price that is warranted(i)by its terms and credit characteristics, or improved in credit quality since itsacquisition by the Issuer;
the issuer of such Collateral Obligation has shown improved(ii)financial results since the published financial reports first produced after it waspurchased by the Issuer;
the obligorObligor of such Collateral Obligation since the date on(iii)which such Collateral Obligation was purchased by the Issuer has raised equitycapital or has raised other capital that has improved the liquidity or creditstanding of such obligorObligor; or
with respect to which one or more of the following criteria applies:(iv)
such Collateral Obligation has been upgraded or put on a(A)watch list for possible upgrade by either of the Rating Agencies or S&Pany rating agency since the date on which such Collateral Obligationwas acquired by the Issuer;
if such Collateral Obligation is a loan or a bond, the(B)Disposition Proceeds (excluding Disposition Proceeds that constituteInterest Proceeds) of such loan or bond would be at least 101% of itspurchase price;
if such Collateral Obligation is a loan, the price of such(C)loan has changed during the period from the date on which it was acquiredby the Issuer to the proposed sale date by a percentage either at least0.25% more positive, or 0.25% less negative, as the case may be, than thepercentage change in the average price of the applicable Eligible LoanIndex over the same period;
if such Collateral Obligation is a floating rate note, the(D)price of such note changed during the period from the date on which itwas acquired by the Issuer to the date of determination by a percentageeither at least 0.50% more positive, or at least 0.50% less negative, as thecase may be, than the percentage change in the average price of theapplicable Approved Index over the same period;
if such Collateral Obligation is a bond, the Market Value of(E)such bond has changed since the date of its acquisition by a percentageeither at least 1.0% more positive or at least 1.0% less negative than thepercentage change in the Merrill Lynch US High Yield Master II Index,Bloomberg ticker H0A0 (or such other nationally recognized index as the
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Investment Manager selects and provides notice of to the RatingAgencies), over the same period, as determined by the InvestmentManager;
if such Collateral Obligation is a loan, the spread over the(F)applicable reference rate for such Collateral Obligation has beendecreased in accordance with the underlying Collateral Obligation sincethe date of acquisition by (1) 0.25% or more (in the case of a loan with aspread (prior to such decrease) less than or equal to 2.00%), (2) 0.375% ormore (in the case of a loan with a spread (prior to such decrease) greaterthan 2.00% but less than or equal to 4.00%) or (3) 0.50% or more (in thecase of a loan with a spread (prior to such decrease) greater than 4.00%)due, in each case, to an improvement in the related borrower’s financialratios or financial results; or
with respect to fixed rate Collateral Obligations, there has(G)been a decrease in the difference between its yield compared to the yieldon the relevant United States Treasury security of more than 0.75% sincethe date of purchase; or (h)
it has a projected cash flow interest coverage ratio(H)(earnings before interest and taxes divided by cash interest expense asestimated by the Investment Manager) of the underlying borrower or otherobligor of such Collateral Obligation that is expected to be more than 1.15times the current year’s projected cash flow interest coverage ratio; or
if a Restricted Trading Period is in effect, any Collateral Obligation:(b)
that in the Investment Manager’s commercially reasonable(i)business judgment has significantly improved in credit quality from the conditionof its credit at the time of purchase and with respect to which one or more of thecriteria referred to in clause (a)(iv) above applies; or
with respect to which a Majority of the Controlling Class vote to(ii)treat such Collateral Obligation as a Credit Improved Obligation.
“Credit Risk Obligation”: Any Collateral Obligation that in the InvestmentManager’s commercially reasonable business judgment has a significant risk of declining incredit quality and, with a lapse of time, becoming a Defaulted Obligation and at any time aRestricted Trading Period is in effect:
any Collateral Obligation as to which one or more of the following criteria(a)applies:
such Collateral Obligation has been downgraded or put on a watch(i)list for possible downgrade by either of the Rating Agencies or S&Pany rating agency since the date on which such Collateral Obligation was acquired by theIssuer;
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if such Collateral Obligation is a loan, the price of such loan has(ii)changed during the period from the date on which it was acquired by the Issuer tothe proposed sale date by a percentage either at least 0.25% more negative, or atleast 0.25% less positive, as the case may be, than the percentage change in theaverage price of an Eligible Loan Index;
if such Collateral Obligation is a loan or bond, the Market Value of(iii)such Collateral Obligation has decreased by at least 1.00% of the price paid bythe Issuer for such Collateral Obligation;
if such Collateral Obligation is a bond, the Market Value of such(iv)bond has changed since its date of acquisition by a percentage either at least 1.0%more negative or at least 1.0% less positive, as the case may be, than thepercentage change in the Merrill Lynch US High Yield Master II Index,Bloomberg ticker H0A0 (or such other index as the Investment Manager selectsand provides notice of to the Rating Agencies) over the same period, asdetermined by the Investment Manager;
if such Collateral Obligation is a loan or floating rate note, (A) the(v)spread over the applicable reference rate for such Collateral Obligation has beenincreased in accordance with the underlying Collateral Obligation since the dateof acquisition by (1) 0.25% or more (in the case of a loan with a spread (prior tosuch increase) less than or equal to 2.00%), (2) 0.375% or more (in the case of aloan with a spread (prior to such increase) greater than 2.00% but less than orequal to 4.00%) or (3) 0.50% or more (in the case of a loan with a spread (prior tosuch increase) greater than 4.00%) due, in each case, to a deterioration in therelated borrower’s financial ratios or financial results;
such Collateral Obligation has a projected cash flow interest(vi)coverage ratio (earnings before interest and taxes divided by cash interest expenseas estimated by the Investment Manager) of the underlying borrower or otherobligor of such Collateral Obligation of less than 1.00 or that is expected to beless than 0.85 times the current year’s projected cash flow interest coverage ratio;or
with respect to fixed rate Collateral Obligations, an increase since(vii)the date of purchase of more than 0.75% in the difference between the yield onsuch Collateral Obligation and the yield on the relevant United States Treasurysecurity; or
with respect to which a Majority of the Controlling Class consents to treat(b)such Collateral Obligation as a Credit Risk Obligation.
“Cure Contribution”: A Contribution (or portion thereof), in an amount as directed and set forth in the associated notice of such Contribution by the applicable Contributor, that shall be used as Principal Proceeds or Interest Proceeds (i) to cause a failing Coverage Test
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to be satisfied; and/or (ii) with respect to any Coverage Test that, with the passage of time, is reasonably expected to fail to be satisfied as determined by the applicable Contributor, to cause such Coverage Test to continue to be satisfied.
“Current Pay Obligation”: Any Collateral Obligation (other than a DIP CollateralObligation) that:
would otherwise be a Defaulted Obligation but for the exclusion of(i)Current Pay Obligations from the definition of Defaulted Obligation pursuant tothe proviso at the end of such definition;
(a) if the issuer of such Collateral Obligation is subject to a(ii)bankruptcy proceeding, the relevant court has authorized the issuer to makepayments of principal, interest or commitment fees on such Collateral Obligationand no such authorized payments that are due and payable are unpaid and (b)otherwise, no payments that are contractually due and payable on such CollateralObligation pursuant to its Underlying Instruments are unpaid; and
for so long as Moody’s is a Rating Agency in respect of any Class(iii)of Rated DebtNotes, such Collateral Obligation has a facility rating fromMoody’s of either (A) at least “Caa1” (and if “Caa1,” not on watch fordowngrade) and its Market Value is at least 80% of its par value or (B) at least“Caa2” (and if “Caa2,” not on watch for downgrade) and its Market Value is atleast 85% of its par value (provided that for purposes of this definition, withrespect to a Collateral Obligation already owned by the Issuer whose facilityrating from Moody’s is withdrawn after the Issuer’s acquisition thereof, thefacility rating shall be the last outstanding facility rating before the withdrawal);
provided that to the extent the Principal Balance of all Collateral Obligations that wouldotherwise be Current Pay Obligations exceeds 5.07.5% of the Collateral Principal Amount, suchexcess over 5.07.5% will constitute Defaulted Obligations; provided, further, that in determiningwhich of the Collateral Obligations will be included in such excess, the Collateral Obligationswith the lowest Market Value expressed as a percentage will be deemed to constitute suchexcess; provided, further, that each such Collateral Obligation included in such excess will betreated as a Defaulted Obligation for all purposes until such time as the aggregate principalbalance of Collateral Obligations that would otherwise be Current Pay Obligations would notexceed, on a pro forma basis including such Defaulted Obligation, 5.07.5% of the CollateralPrincipal Amount.
“Custodial Account”: The custodial account established pursuant to Section 10.3(b).
“Custodian”: The meaning specified in the first sentence of Section 3.3(b) withrespect to items of collateral referred to therein, and each entity with which an Account ismaintained, as the context may require, each of which shall be a Securities Intermediary.
“Debt”: The Notes and the Class A Loans.
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“Debt Interest Amount”: With respect to any specified Class of Rated Debt and any Payment Date, the amount of interest for the next Interest Accrual Period payable in respect of each U.S.$100,000 Outstanding principal amount of such Class of Rated Debt.
“Debt Interest Rate”: With respect to any specified Class of Rated Debt, the per annum interest rate payable on the Rated Debt of such Class with respect to each Interest Accrual Period equal to LIBOR for such Interest Accrual Period plus the spread specified in Section 2.3 with respect to such Rated Debt, which, if a Re-Pricing has occurred with respect to a Class of Re-Pricing Eligible Debt, will be the applicable Re-Pricing Rate for such Class.
“Default”: Any Event of Default or any occurrence that is, or with notice or thelapse of time or both would become, an Event of Default.
“Defaulted Obligation”: Any Collateral Obligation included in the Assets shallconstitute a “Defaulted Obligation” if:
there has occurred and is continuing a default with respect to the payment(a)of interest or principal with respect to such Collateral Obligation, without regard to any grace period except as set forth in this clause (a); provided that such default shall not have not been cured; provided, further, that any such default shall be subject to a graceperiod of the lesser of (i) five (5) Business Days (or seven (7) calendar days, whichever isgreater) and (ii) the grace period specified in the applicable Underlying Instruments, ineach case measured from the date of such default if the Investment Manager has certifiedto the Trustee and the Collateral Agent in writing that the payment failure is not due tocredit-related reasons;
a default as to the payment of principal and/or interest has occurred and is(b)continuing on another debt obligation of the same issuer which is senior or pari passu inright of payment to such Collateral Obligation (provided that bothand holders of such other debt obligation of the same issuer have accelerated the maturity of all or a portion of such other debt obligation; provided that both the Collateral Obligation and such otherdebt obligations are full recourse obligations); provided, further, that any such defaultshall be subject to a grace period of the lesser of (i) five (5) Business Days (or seven (7) calendar days, whichever is greater) and (ii) the grace period specified in the applicableUnderlying Instruments, in each case measured from the date of such default if theInvestment Manager has certified to the Trustee and the Collateral Agent in writing thatthe payment failure is not due to credit-related reasons;
the issuer or others have instituted proceedings to have the issuer(c)adjudicated as bankrupt or insolvent or placed into receivership and such proceedingshave not been stayed or dismissed within 60ninety (90) days of such filing or such issuerhas filed for protection under Chapter 11 of the United States Bankruptcy Code;
such Collateral Obligation has (x) a Fitch Rating of “D” or “RD” or below (d)or (y) a Moody’s probability of default rating (as published by Moody’s) of “D” or “LD”
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or, in each case, had such ratingsrating immediately before they wereit was withdrawn byFitch or Moody’s, as applicable;
such Collateral Obligation is pari passu or junior in right of payment as to(e)the payment of principal and/or interest to another debt obligation of the same issuerwhich has (i) a Fitch Rating of “D” or “RD” or below or had such rating before such rating was withdrawn or (ii) a Moody’s probability of default rating (as published byMoody’s) of “D” or “LD” or had such rating before such rating was withdrawn, and suchother debt obligation remains outstanding (provided, that both the Collateral Obligationand such other debt obligation are full recourse obligations of the applicable issuer);
the Investment Manager has received written notice or has actual(f)knowledge that a default has occurred under the Underlying Instruments and anyapplicable grace period has expired such that the holders of such Collateral Obligationmay accelerate the repayment of such Collateral Obligation (but only until such default iscured or waived) in the manner provided in the Underlying Instruments;
the Investment Manager has in its reasonable commercial judgment(g)otherwise declared such debt obligation to be a “Defaulted Obligation”;
(h) such Collateral Obligation is a Participation Interest with respect to which the Selling Institution has defaulted in the performance of any of its payment obligations under the Participation Interest (except to the extent such defaults were cured within the applicable grace period under the Underlying Instruments of the obligor thereof);
(i) such Collateral Obligation is a Participation Interest in a loan that(h)would, if such loan were a Collateral Obligation, constitute a “Defaulted Obligation”(other than under this clause (ih)) or with respect to which the Selling Institution has aMoody’s probability of default rating (as published by Moody’s) of “D” or “LD” or hadsuch rating before such rating was withdrawn (except to the extent such defaults were cured within the applicable grace period under the underlying instruments of the Obligor thereof); or
(j) a Distressed Exchange has occurred in connection with such Collateral(i)Obligation;
provided, that a Collateral Obligation will not constitute a Defaulted Obligation pursuant toclauses (a) through (e), (ih) and (ji) above if: (x) in the case of clauses (a), (b), (c), (d), (e), (i)and (ji), such Collateral Obligation is a Current Pay Obligation (provided that, in the case ofclause (ih) above, the applicable Selling Institution shall also be required to continue to makecurrent payments to the Issuer under the Participation Interest), or (y) in the case of clauses (b),(c) and (e), such Collateral Obligation is a DIP Collateral Obligation.
“Deferrable Obligation”: A Collateral Obligation (including any Permitted Deferrable Obligation) that by its terms permits the deferral or capitalization of payment ofaccrued, unpaid interest.
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“Deferred Interest”: With respect to any specified Class of Deferred InterestNotes, the meaning specified in Section 2.8(b).
“Deferred Interest Notes”: The Notes specified as such in Section 2.3.
“Deferred Management Fee Interest”: Collectively, the Deferred SeniorManagement Fee Interest and the Deferred Subordinated Management Fee Interest.
“Deferred Management Fees”: Collectively, the Deferred Senior ManagementFee and the Deferred Subordinated Management Fee.
“Deferred Senior Management Fee”: Any accrued and unpaid SeniorManagement Fee payable to the Investment Manager on any Payment Date that the InvestmentManager has elected in its sole discretion to waive or defer.
“Deferred Senior Management Fee Interest”: Interest on any accrued and unpaidDeferred Senior Management Fee, which shall accrue at the rate of three-month LIBOR plus0.20% for the period from (and including) the date on which such Deferred Senior ManagementFee was deferred through (but excluding) the date of payment thereof (calculated on the basis ofa 360-day year and the actual number of days elapsed).
“Deferred Subordinated Management Fee”: Any accrued and unpaidSubordinated Management Fee payable to the Investment Manager on any Payment Date that theInvestment Manager has elected in its sole discretion to waive or defer.
“Deferred Subordinated Management Fee Interest”: Interest on any accrued andunpaid Deferred Subordinated Management Fee, which shall accrue at the rate of three-monthLIBOR plus 0.30% for the period from (and including) the date on which such DeferredSubordinated Management Fee was deferred through (but excluding) the date of payment thereof(calculated on the basis of a 360-day year and the actual number of days elapsed).
“Deferring Obligation”: A Deferrable Obligation that is not a PurposelyDeferring Obligation and that is deferring the payment of interest due thereon and has been sodeferring the payment of interest due thereon (i) with respect to Collateral Obligations that havea Moody’s Rating of at least “Baa3,” for the shorter of two consecutive accrual periods or oneyear, and (ii) with respect to Collateral Obligations that have a Moody’s Rating of “Ba1” orbelow, for the shorter of one accrual period or six consecutive months, which deferredcapitalized interest has not, as of the date of determination, been paid in cash; provided that suchDeferrable Obligation will cease to be a Deferring Obligation at such time as it (a) ceases todefer or capitalize the payment of interest, (b) pays in cash all accrued and unpaid interest,including all deferred amounts, and (c) commences payment of all current interest in cash.
“Delayed Drawdown Collateral Obligation”: Any Asset that (a) requires theIssuer to make one or more future advances to the borrower under the underlying instrumentsrelating thereto, (b) specifies a maximum amount that can be borrowed on one or more fixedborrowing dates, and (c) does not permit the re borrowing of any amount previously repaid bythe borrower thereunder; provided that any such Collateral Obligation will be a Delayed
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Drawdown Collateral Obligation only until all commitments by the Issuer to make advances tothe borrower expire or are terminated or reduced to zero.
“Deliver” or “Delivered” or “Delivery”: The taking of the following steps:
in the case of each Certificated Security (other than a Clearing(i)Corporation Security), Instrument or Participation Interest in which theunderlying loan is represented by an Instrument,
causing the delivery of such Certificated Security or(1)Instrument to the Custodian by registering the same in the name ofthe Custodian or its affiliated nominee or by endorsing the same tothe Custodian or in blank;
causing the Custodian to continuously indicate on(2)its books and records that such Certificated Security or Instrumentis credited to the applicable Account; and
causing the Custodian to maintain continuous(3)possession of such Certificated Security or Instrument;
in the case of each Uncertificated Security (other than a Clearing(ii)Corporation Security),
causing such Uncertificated Security to be(1)continuously registered on the books of the issuer thereof to theCustodian; and
causing the Custodian to continuously indicate on(2)its books and records that such Uncertificated Security is creditedto the applicable Account;
in the case of each Clearing Corporation Security,(iii)
causing the relevant Clearing Corporation to credit(1)such Clearing Corporation Security to the securities account of theCustodian, and
causing the Custodian to continuously indicate on(2)its books and records that such Clearing Corporation Security iscredited to the applicable Account;
in the case of each security issued or guaranteed by the United(iv)States of America or agency or instrumentality thereof and that is maintained inbook entry records of a Federal Reserve Bank (“FRB”) (each such security, a“Government Security”),
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causing the creation of a Security Entitlement to(1)such Government Security by the credit of such GovernmentSecurity to the securities account of the Custodian at such FRB,and
causing the Custodian to continuously indicate on(2)its books and records that such Government Security is credited tothe applicable Account;
in the case of each Security Entitlement not governed by clauses(v)(i) through (iv) above,
causing a Securities Intermediary (x) to indicate on(1)its books and records that the underlying Financial Asset has beencredited to the Custodian’s securities account, (y) to receive aFinancial Asset from a Securities Intermediary or acquiring theunderlying Financial Asset for a Securities Intermediary, and ineither case, accepting it for credit to the Custodian’s securitiesaccount or (z) to become obligated under other law, regulation orrule to credit the underlying Financial Asset to a SecuritiesIntermediary’s securities account,
causing such Securities Intermediary to make(2)entries on its books and records continuously identifying suchSecurity Entitlement as belonging to the Custodian andcontinuously indicating on its books and records that such SecurityEntitlement is credited to one of the Custodian’s Accounts, whichshall at all times be securities accounts, and
causing the Custodian to continuously indicate on(3)its books and records that such Security Entitlement (or all rightsand property of the Custodian representing such SecurityEntitlement) is credited to the applicable Account;
in the case of Cash or Money,(vi)
causing the delivery of such Cash or Money to the(1)Collateral AgentTrustee for credit to the applicable Account or tothe Custodian,
if delivered to the Custodian, causing the Custodian(2)to treat such Cash or Money as a Financial Asset maintained bysuch Custodian for credit to the applicable Account in accordancewith the provisions of Article 8 of the UCC or causing theCustodian to deposit such Cash or Money to a deposit accountover which the Custodian has control (within the meaning ofSection 9-104 of the UCC), and
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causing the Custodian to continuously indicate on(3)its books and records that such Cash or Money so held is creditedto the applicable Account; and
in the case of each general intangible (including any Participation(vii)Interest in which the Participation Interest is not represented by an Instrument),
causing the filing of a Financing Statement in the(1)office of the Recorder of Deeds of the District of Columbia,Washington, D.C., and
causing the registration of the security interest(2)granted by this Indenture and Security Agreement in the Registerof Mortgages of the Issuer at the Issuer’s registered office in theCayman Islands.
In addition, the Investment Manager on behalf of the Issuer will obtain any andall consents required by the Underlying Instruments relating to any such general intangibles forthe transfer of ownership and/or pledge hereunder (except to the extent that the requirement forsuch consent is rendered ineffective under Section 9-406 of the UCC).
“Designated Base Rate”: The reference rate (and, if applicable, the methodology for calculating such base rate) determined by the Investment Manager (in its commercially reasonable discretion) based on (1) the rate proposed or recommended (whether by letter, protocol, publication of standard terms or otherwise) as a replacement for Libor in the leveraged loan market by the Alternative Reference Rates Committee convened by the Federal Reserve, (2) the rate acknowledged as a standard replacement in the leveraged loan market for Libor by the Loan Syndications and Trading Association® or (3) if 50% or more of the Collateral Obligations are quarterly pay floating rate Collateral Obligations, the rate that is consistent with the reference rate being used in at least 50% (by principal amount) of (x) the quarterly pay floating rate Collateral Obligations included in the Assets or (y) the floating rate securities issued in the new-issue collateralized loan obligation market in the prior month that bear interest based on a base rate other than Libor.
“Designated Excess Par”: The meaning specified in Section 9.2(f).
“Determination Date”: The last day of each Collection Period.
“DIP Collateral Obligation”: Any interest in a loan or financing facility that has a public or private facility rating from Moody’s and is purchased directly or by way of assignment (a) which is an obligation of (i) a debtor-in-A loan (i) obtained or incurred after the entry of an order of relief in a case pending under Chapter 11 of the United States Bankruptcy Code, (ii) to a debtor in possession as described in §Section 1107 of the United States Bankruptcy Code or (ii) a trustee (if appointment of such trustee has been ordered pursuant to §Section 1104 of theUnited States Bankruptcy Code (in either such case, a “Debtor”) organized under the laws of the United States or any state therein, or), (biii) on which the related Obligorobligor is required topay interest on a current basis and, with respect to either clause (a) or (b) above, the terms of
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which have been, (iv) approved by an order of the United States Bankruptcy Court, the United States District Court, or any other court of competent jurisdiction, the enforceability of which order is not subject to any pending contested matter or proceeding (as such terms are defined in the Federal Rules of Bankruptcy Procedure) and which order provides that: (i) (A) such DIP Collateral Obligation isa final or interim order of the bankruptcy court so long as such loan is (A) fully secured by liensa lien on the Debtordebtor’s otherwise unencumbered assets pursuantto §Section 364(c)(2) of the United States Bankruptcy Code or, (B) such DIP Collateral Obligation isfully secured by liensa lien of equal or senior priority on property of theDebtor’sdebtor estate that is otherwise subject to a lien pursuant to §Section 364(d) of the United States Bankruptcy Code and (ii) such DIP Collateral Obligationor (C) is secured by a junior lien on the debtor’s encumbered assets (so long as such loan is fully secured based upon aon the most recent current valuation or appraisal report. Notwithstanding the foregoing, such a loan will not be deemed to be a DIP Collateral Obligation following the emergence of the related debtor-in-possession from bankruptcy protection under Chapter 11 of the Bankruptcy Code, if any, of the debtor) and (v) that (A) for so long as Moody’s or Fitch is a Rating Agency, has been rated by Moody’s or Fitch or has an estimated rating by Moody’s or Fitch (or if the loan does not have a rating or an estimated rating by Moody’s or Fitch, the Trustee has commenced the process of having a rating assigned by either Rating Agency within five (5) Business Days of the date the loan is acquired by the Issuer) and (B) has been rated by S&P or has an estimated rating by S&P (or if the Loan does not have a rating or an estimated rating by S&P, the Trustee has commenced the process of having a rating assigned by S&P within five (5) Business Days of the date the loan is acquired by the Issuer).
“Discount Obligation”: Any Collateral Obligation forming part of the Assets that(i) is:(a) a Senior Secured Loan acquired by the Issuer with respect to which, if such Collateral Obligation (ithat (a) has a Moody’s Rating below “B3”, the purchase price thereof (as determined without averaging prices of purchases on different dates) is less than 85% of itsPrincipal Balance or (iib) has a Moody’s Rating “B3” or higher, the purchase price thereof (as determined without averaging prices of purchases on different dates) is less than 80% of itsPrincipal Balance, in each case until the Market Value of the Collateral Obligation for any periodof thirty (30) consecutive days equals or exceeds 90% of its Principal Balance; or(b) (ii) is not anon-Senior Secured Loan acquired by the Issuer with respect to which, if such Collateral Obligation (ithat (a) has a Moody’s Rating below “B3”, the purchase price thereof (as determined without averaging prices of purchases on different dates) is less than 80% of its Principal Balance and, in the case of a fixed-rate Collateral Obligation, has a yield greater than 2.0% over the yield of the Merrill Lynch US High Yield Master II Index or other Approved Index selected by the Investment Manager or (iiis less than 80% of its principal balance or (b)has a Moody’s Rating “B3” or higher, the purchase price thereof (as determined without averaging prices of purchases on different dates) is less than 75% of its Principal Balance and, in the case of a fixed-rate Collateral Obligation, has a yield greater than the yield of the Merrill Lynch US High Yield Master II Index or other Approved Index selected by the Investment Manager, in each case until, for any period of 30 consecutive days, either (1) in the case of non-Senior Secured Loans,, in each case until the Market Value of the Collateral Obligation for any period of thirty (30) consecutive days equals or exceeds 85% of its Principal Balance or (2) in the case of a fixed-rate Collateral Obligation, its yield is less than or equal to 2.0% over the yield of the Merrill Lynch US High Yield Master II Index (or other Approved Index selected by the Investment Manager); provided that the yield of any specific Bond shall be measured in
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reference to the same index when determining whether such Bond is and subsequently ceases to be a Discount Obligation.
Any Collateral Obligation that would otherwise be considered a DiscountObligation but that is purchased with the proceeds of a sale of a Collateral Obligation that wasnot a Discount Obligation at the time ofprior to its purchasesale will not be considered aDiscount Obligation, so long as (A) the Investment Manager, using its commercially reasonable business judgment, believes that such purchased Collateral Obligation is of better credit quality than the previous, sold asset and (B) at the time of its acquisition, such purchased CollateralObligation: (x) has a Moody’s Rating or Moody’s Default Probability Rating no lower than theMoody’s Rating or Moody’s Default Probability Rating of the previously sold CollateralObligation, (y) is purchased or committed to be purchased within 10twenty (20) Business Daysof such sale and (z) is purchased at a purchase price that equals or exceeds both (1) the sale priceof the sold Collateral Obligation and (2) 65% of its Principal Balancethe lower of (x) 50% and (y) the quoted price of the S&P/LSTA Leveraged Loan Index; provided that, to the extent that the Aggregate Principal Balance of Collateral Obligations purchased after theClosingAmendment Date under this paragraph cumulatively exceeds 10.025.0% of theAggregate Ramp-Up Par Amount, in each case, such excess shall be considered DiscountObligations; provided, further, that such Collateral Obligation shall cease to be a DiscountObligation at such time as (x) the Market Value of the Collateral Obligation for any period ofthirty (30) consecutive days equals or exceeds, (i) for Senior Secured Loans, 90% (or in the case of a non-Senior Secured Loan, 85%)of its Principal Balance and (ii) for non-Senior Secured Loans, 85% of its Principal Balance or (y) in the case of a fixed-rate Collateral Obligation, its yield is less than or equal to 2.0% over the yield of the Merrill Lynch US High Yield Master II Index or other Approved Index selected by the Investment Manager..
If such Collateral Obligation is a Revolving Collateral Obligation and there exists an outstanding non-revolving loan to its Obligor ranking pari passu with such Revolving Collateral Obligation and secured by substantially the same collateral as such Revolving Collateral Obligation (such loan, a “Related Term Loan”), in determining whether such Revolving Collateral Obligation is and continues to be a Discount Obligation, the price of the Related Term Loan, and not of the Revolving Collateral Obligation, shall be referenced.
“Disposition Proceeds”: Proceeds received with respect to sales of CollateralObligations, Eligible Investments and Equity Securities and the termination of any HedgeAgreement, in each case, net of reasonable out-of-pocket expenses and disposition costs inconnection with such sales.
“Dissolution Expenses”: The amount of expenses reasonably likely to beincurred in connection with the discharge of this Indenture and Security Agreement, the termination of the Credit Agreement, the liquidation of the Assets and the dissolution of theCo-Issuers and the Income Note Issuer, as reasonably certified by the Investment Manager or theIssuer, based in part on expenses incurred by the Trustee and the Collateral Agent and reportedto the Investment Manager.
“Distressed Exchange”: In connection with any Collateral Obligation, adistressed exchange or other debt restructuring has occurred, as reasonably determined by the
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Investment Manager, pursuant to which the issuer or obligor of such Collateral Obligation hasissued to the holders of such Collateral Obligation a new security or package of securities orobligations that, in the sole judgment of the Investment Manager, amounts to a diminishedfinancial obligation or has the purpose of helping the issuer of such Collateral Obligation avoiddefault; provided that no Distressed Exchange shall be deemed to have occurred if the securitiesor obligations received by the Issuer in connection with such exchange or restructuring meet thedefinition of “Collateral Obligation.”
“Distribution Report”: The meaning specified in Section 10.6(b).
“Diversity Score”: A single number that indicates collateral concentration interms of both issuer and industry concentration, calculated as set forth in Schedule 3.
“Domicile” or “Domiciled”: With respect to any issuer of or obligorObligor withrespect to a Collateral Obligation: (a) except as provided in clauseclauses (b) and (c) below, itscountry of organization; or (b) if it is organized in a Tax Advantaged Jurisdiction, each of suchjurisdiction and the country in which, in the Investment Manager’s good faith estimate, asubstantial portion of its operations are located or from which a substantial portion of its revenueis derived, in each case directly or through subsidiaries; or (c) if its payment obligations in respect of such Collateral Obligation are guaranteed by a person or entity (in a guarantee agreement with such person or entity, which guarantee agreement complies with Moody’s then-current public guidelines with respect to guarantees) that is organized in the United States, then the United States.
“DTC”: The Depository Trust Company, its nominees, and their respectivesuccessors.
“Due Date”: Each date on which any payment is due on a Pledged Obligation inaccordance with its terms.
“Effective Date Deposit Condition”: A condition satisfied if (a) on the applicable date of determination, all Portfolio Quality Tests and Concentration Limitations are satisfied after giving effect to the designation specified in Section 10.2(g) and (b) on such date of determination, the Aggregate Principal Balance of the Collateral Obligations and the Eligible Investments constituting Principal Proceeds are greater than or equal to the Aggregate Ramp-Up Par Amount after giving effect to such designation; provided that for purposes of this definition, the Principal Balance of any Defaulted Obligations or Deferrable Obligations will be the Moody’s Collateral Value of such Collateral Obligation.
“Effective Spread”: With respect to any floating rate Collateral Obligation, thecurrent per annum rate at which it pays interest minus LIBOR or, if such floating rate CollateralObligation bears interest based on a floating rate index other than a London interbank offeredrate-based index, the Effective Spread shall be the then-current base rate applicable to suchfloating rate Collateral Obligation plus the rate at which such floating rate Collateral Obligationpays interest in excess of such base rate minus LIBOR; provided that (i) with respect to anyunfunded commitment of any Revolving Collateral Obligation or Delayed Drawdown CollateralObligation, the Effective Spread means the commitment fee payable with respect to such
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unfunded commitment, (ii) with respect to the funded portion of any commitment under anyRevolving Collateral Obligation or Delayed Drawdown Collateral Obligation, the EffectiveSpread means the current per annum rate at which it pays interest minus LIBOR or, if suchfunded portion bears interest based on a floating rate index other than a London interbankoffered rate-based index, the Effective Spread will be the then-current base rate applicable tosuch funded portion plus the rate at which such funded portion pays interest in excess of suchbase rate minus LIBOR and (iii) with respect to any LIBOR Floor Obligation, the stated interestrate spread on such Collateral Obligation above the applicable index shall be deemed to be equalto the sum of (A) the stated interest rate spread over the applicable index and (B) the excess, ifany, of the specified “floor” rate relating to such Collateral Obligation over the applicable index;provided, further, that the Effective Spread of any floating rate Collateral Obligation shall (i) bedeemed to be zero to the extent that the Issuer or the Investment Manager has actual knowledgethat no payment of cash interest on such floating rate Collateral Obligation will be made by theobligor thereof during the applicable due period and (ii) not include any non-cash interest.
“Eligible Investment Required Ratings”: (a) If such obligation or security (i) has both a long term and a short term credit rating from Moody’s, such ratings are “Aa3rating is “A1” or higher (and not on credit watch for possible downgrade) and “P-1” (not on credit watch for possible downgrade), respectively, (ii) has only a long term credit rating from Moody’s, such rating is at least equal to or higher than the current Moody’s long term ratings of the U.S. government and (iii (ii) has only a short term credit rating from Moody’s, such rating is “P -1”(not on credit watch for possible downgrade) and (b) for securities with maturities up to 365 days, a long-term credit rating not less than “AA-” from Fitch and a short-term rating not less than “F1+”; provided that, in the case of a bank in its capacity as paying agent, eligible trust account provider, servicer, counterparty or guarantor, references to “Eligible Investment Required Ratings” shall mean a senior unsecured debt rating of at least “A1” or “P-1” by Moody’s and (b) for securities (x) with remaining maturities up to thirty (30) days, a short-term credit rating of at least “F1” and a long-term credit rating of at least “A” (if such long-term rating exists) from Fitch or (y) with remaining maturities of more than thirty (30) days but not in excess of 365 days, a short-term credit rating of “F1+” and a long-term credit rating of at least “AA-” (if such long-term rating exists) from Fitch.
“Eligible Investments”: (a) Cash or (b) any United States dollar investment that,at the time it is Delivered to the Collateral AgentTrustee (directly or through an intermediary orbailee), is a “cash equivalent” for purposes of the loan securitization exemption under the Volcker Rule and is one or more of the following obligations or securities:
direct obligations of, and obligations the timely payment of(i)principal and interest on which is fully and expressly guaranteed by, the UnitedStates of America or any agency or instrumentality of the United States ofAmerica the obligations of which are expressly backed by the full faith and creditof the United States of America and which satisfy the Eligible InvestmentRequired Ratings;
demand and time deposits in, certificates of deposit of, bank (ii)deposit products of, trust accounts with, bankers’ acceptances issued by, orfederal funds sold by any depository institution or trust company incorporated
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under the laws of the United States of America (including the Bank and any Affiliates of the Bank) or any state thereof and subject to supervision andexamination by federal and/or state banking authorities, in each case payablewithin 183 days of issuance, so long as the commercial paper and/or the debtobligations of such depository institution or trust company (or, in the case of the principal depository institution in a holding company system, the commercial paper or debt obligations of such holding company) at the time of such investmentor contractual commitment providing for such investment have the EligibleInvestment Required Ratings;
commercial paper (excludingor other short-term obligations with (iii)the Eligible Investment Required Ratings and that either bear interest or are sold at a discount from the face amount thereof and have a maturity of not more than 183 days from their date of issuance; provided that this clause (iii) shall not include extendible commercial paper or asset backed commercial paper) which satisfies the Eligible Investment Required Ratings; and
shares or other securities of non-United States registered money(iv)market funds domiciled outside of the United States which funds have, at all times, credit ratings of “Aaa-mf” or equivalent ratings at that time by Moody’sand AAAm by S&Peither the highest credit rating assigned by Fitch (“AAAmmf”) to the extent rated by Fitch or otherwise the highest credit rating assigned by another NRSRO (excluding Moody’s);
provided, however, that Eligible Investments purchased with funds in the Collection Accountwill be held until maturity except as otherwise specifically provided herein and will include onlysuch obligations or securities, other than those referred to in clause (iv) above, as mature (or areputable at par to the issuer or obligor thereof) no later than the earlier of 60 days and theBusiness Day prior to the next Payment Date (unless such Eligible Investments are issued by theTrustee in its capacity as a banking institution, in which case such Eligible Investments maymature on such Payment Date); provided, further, that none of the foregoingnotwithstanding the foregoing clauses (i) through (iv), except to the extent the Permitted Securities Condition is satisfied with respect thereto, unless the Issuer and the Investment Manager have received an opinion of counsel of national reputation experienced in such matters to the contrary (together with an Officer’s certificate of the Issuer or the Investment Manager to the Trustee (on which the Trustee may rely) that the opinion specified in this definition has been received by the Issuer and the Investment Manager), Eligible Investments may only include obligations or securities shall constitute Eligible Investments if (1) all, or substantially all, of the remaining amounts payable thereunder consist of interest and not principal payments, (2) such obligation or security is subject to withholding tax (other than any withholding tax imposed pursuant to FATCA) unless the issuer of the security is required to make “gross up” payments that ensure that the net amount actually received by the Issuer (after payment of all taxes, whether imposed on such Obligor or the Issuer) will equal the full amount that the Issuer would have received had no such taxes been imposed, (3) such obligation or security is secured by real property, (4) such obligation or security is purchased at a price greater than 100% of the principal or face amount thereof or (5) in the Investment Manager’s sole judgment, such obligation or security is subject to material non-credit related risksthat constitute cash equivalents for purposes of the rights and assets in
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paragraph 10(c)(8)(i)(B) of the exclusions from the definition of “covered fund” for purposes of the Volcker Rule; provided, further, that none of the foregoing obligations or securities shallwillconstitute Eligible Investments unless the acquisition thereof will not cause the Issuer to violate the Tax Guidelinesif such obligation or security invests in, or constitutes, Structured Finance Obligations. The Trustee shall have no obligation to determine or oversee compliance with the immediately preceding proviso. Eligible Investments may include, without limitation, thoseinvestments for which the Trustee, the Loan Agent or the Collateral Agent or an Affiliate of theTrustee, the Loan Agent or the Collateral Agent is the obligor or depository institution, orprovides services and receives compensation.
“Eligible Loan Index”: With respect to each Collateral Obligation that is a loan,one of the following indices as selected by the Investment Manager upon the acquisition of suchCollateral Obligation: the Credit Suisse Leveraged Loan Indices (formerly the DLJ LeveragedLoan Index Plus), the Deutsche Bank Leveraged Loan Index, the Goldman Sachs/Loan PricingCorporation Liquid Leveraged Loan Index, the Merrill Lynch Leveraged Loan Index, theS&P/LSTA Leveraged Loan Indices or any nationally recognized comparable replacement loanindex (other than an index that is maintained by an Affiliate of the Investment Manager);provided that the Investment Manager may change the index applicable to a CollateralObligation at any time following the acquisition thereof after giving notice to Moody’s, theTrustee, the Collateral Agent and the Collateral Administrator.
“Emerging Market Obligor”: Any obligor Domiciled (without giving effect toclause (c) in the definition thereof) in a country that (a) is not the United States, (b) is not a TaxAdvantaged Jurisdiction the foreign currency country ceiling rating of which (as well as theforeign currency country ceiling rating of the country in which a substantial portion of itsoperations are located or from which a substantial portion of its revenue is derived, in each casedirectly or through subsidiaries) is, at the time of acquisition of the relevant CollateralObligation, at least “A3” by Moody’s or (c) is not any other country and the foreign currencycountry ceiling rating of which is, at the time of acquisition of the relevant Collateral Obligation,at least “A3” by Moody’s; provided, that an obligor Domiciled in a country that has a countryceiling for foreign currency bonds of “A1”, “A2” or “A3” by Moody’s shall not be deemed to bean Emerging Market Obligor on the date of acquisition of the related Collateral Obligation bythe Issuer as long as the Collateral Obligations of which are not deemed to be all EmergingMarket Obligors under this proviso does not exceed 10.0% of the Collateral Principal Amounton such date.
“Entitlement Holder”: The meaning specified in Section 8-102(a)(7) of the UCC.
“Entitlement Order”: The meaning specified in Section 8-102(a)(8) of the UCC.
“Equity Security”: Any security or debt obligation that at the time of acquisition,conversion or exchange does not satisfy one or more of the requirements of clauses (i) through(xix) and (xxi) through (xxiii) of the definition of “Collateral Obligation” and is not an EligibleInvestment; it being understood that Equity Securities may not be purchased by the Issuer but itis possible that the Issuer (or an Issuer Subsidiary as prescribed by the Investment ManagementAgreement) may receive an Equity Security in exchange for a Collateral Obligation or a portionthereof in connection with an insolvency, bankruptcy, reorganization, debt restructuring or
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workout of the issuer thereof that would be considered “received in lieu of debts previously contracted” with respect to the Collateral Obligation under the Volcker Rule, unless the Permitted Securities Condition is satisfied with respect thereto .
“ERISA”: The United States Employee Retirement Income Security Act of 1974,as amended from time to time.
“ERISA Restricted Certificated Note”: An ERISA Restricted Note issued in theform of a Certificated Note.
“ERISA Restricted Global Note”: An ERISA Restricted Note issued in the formof a Global Note.
“ERISA Restricted Notes”: The Class E Notes, the Class F Notes and theSubordinated Notes.
“Euroclear”: Euroclear Bank S.A./N.V. as operator of the Euroclear System.
“Event of Default”: The meaning specified in Section 5.1.
“Excepted Advances”: Customary advances made to protect or preserve rightsagainst the borrower of or obligor under a Collateral Obligation or to indemnify an agent orrepresentative for lenders pursuant to the Underlying Instrument.
“Excepted Property”: The meaning specified in the Granting Clause.
“Excess CCC/Caa Adjustment Amount”: As of any date of determination, anamount equal to the greater of (A) the product of (i) the Aggregate Principal Balance of allCollateral Obligations included in the Caa Excess multiplied by (ii) the excess, if any, of (x) 1over (y) the weighted average Market Value (expressed as a percentage of the par amount ofeach such Collateral Obligation) of all Caa Collateral Obligations included in the Caa Excess and (B) the product of (i) the Aggregate Principal Balance of all Collateral Obligations included in the CCC Excess multiplied by (ii) the excess, if any, of (x) 1 over (y) the weighted average Market Value (expressed as a percentage of the par amount of each such Collateral Obligation) of all CCC Collateral Obligations included in the CCC Excess.
“Excess Weighted Average Fixed Coupon”: As of any Measurement Date, a percentage equal to the product obtained by multiplying (a) the greater of zero and the excess, if any, of the Weighted Average Fixed Coupon over the Minimum Fixed Coupon by (b) the number obtained by dividing (i) the Aggregate Principal Balance of all fixed rate Collateral Obligations (excluding any Defaulted Obligation and, to the extent of any non-cash interest, any Deferrable Obligation) by (ii) the Aggregate Principal Balance of all floating rate Collateral Obligations (excluding any Defaulted Obligation and, to the extent of any non-cash interest, any Deferrable Obligation).Par Amount”: An amount, as of any date of determination, equal to the greater of (a) zero and (b)(i) the Collateral Principal Amount less (ii) the Reinvestment Target Par Balance.
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“Excess Weighted Average Floating Spread”: As of any Measurement Date, a percentage equal to the product obtained by multiplying (a) the greater of zero and the excess, if any, of the Weighted Average Floating Spread over the Minimum Floating Spread by (b) the number obtained by dividing (i) the Aggregate Principal Balance of all floating rate Collateral Obligations (excluding any Defaulted Obligation and, to the extent of any non-cash interest, any Deferrable Obligation) by (ii) the Aggregate Principal Balance of all fixed rate Collateral Obligations (excluding any Defaulted Obligation and, to the extent of any non-cash interest, any Deferrable Obligation).
“Exchange”: The meaning specified in Section 2.15(d)(ii).
“Exchange Act”: The United States Securities Exchange Act of 1934, asamended from time to time.
“Exercise Notice”: The meaning specified in Section 9.9(c).
“Expense Reserve Account”: The trust account established pursuant to Section 10.3(d).
“FATCA”: Sections 1471 through 1474 of the Code, any current or futureregulations or official interpretations thereof, any agreement entered into pursuant to Section1471(b) of the Code, or any fiscal or regulatory legislation, rules or practices adopted pursuant toany intergovernmental agreement entered into in connection with the implementation of suchSections of the Code, including any Cayman Islands fiscal or regulatory legislation, rule,guidance notes or practices adopted to implement Sections 1471 through 1474 of the Code, andany Cayman Islands fiscal or regulatory legislation, rule, guidance notes or practices adopted toimplement any current provision of United Kingdom law that is analogous to Sections 1471through 1474 of the Code.
“FATCA Compliance”: Compliance with FATCA (including, but not limited to,as necessary so that no tax will be imposed or withheld thereunder in respect of payments to orfor the benefit of the Issuer or the Income Note Issuer, as applicable) and any analogous provisions of applicable law (including the Cayman FATCA Legislation and the Organisation for Economic Co-operation and Development’s Standard for Automatic Exchange of Financial Account Information – Common Reporting Standard (each as amended) (including any implementing legislation, rules, regulations and guidance notes with respect to such laws)).
“Federal Reserve Board”: The Board of Governors of the Federal ReserveSystem.
“Fee Letter”: The letter between the Issuer and the Income Note Issuer regardingpayment of administrative fees and expenses of the Income Note Issuer.
“Financial Asset”: The meaning specified in Section 8-102(a)(9) of the UCC.
“Financing Statements”: The meaning specified in Section 9-102(a)(39) of theUCC.
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“First LIBOR Period End Date”: October 15, 2014.Firm Bid”: With respect to a Collateral Obligation, a binding, irrevocable bid for value for such Collateral Obligation from a dealer to purchase such Collateral Obligation, for which the trust officer of the Trustee has not received written notice that such bid is subject to a Bid Disqualification Condition.
“First-Lien Last-Out Loan”: A Collateral Obligation that, prior to a default withrespect to such loan, is entitled to receive payments pari passu with other Senior Secured Loansof the same obligor, but following a default (including with respect to liquidation) becomes fullysubordinated in right of payment to other Senior Secured Loans of the same obligor and is notentitled to any payments until such other Senior Secured Loans are paid in full.
“Fitch”: Fitch Ratings, Inc. and any successor in interest.
“GAAP”: The meaning specified in Section 6.2(j).
“Global Notes”: Any Regulation S Global Notes or Rule 144A Global Notes.
“Global Rating Agency Condition”: With respect to any action taken or to betaken by or on behalf of the Issuer, the satisfaction of the Moody’s Rating Condition and thedelivery of prior written notice of such action to Fitch within five (5) Business Days of takingsuch action; provided that Fitch may waive such notice requirement.
“Grant” or “Granted”: To grant, bargain, sell, convey, assign, transfer, mortgage,pledge, create and grant a security interest in and right of setoff against, deposit, set over andconfirm. A Grant of the Pledged Obligations, or of any other instrument, shall include all rights,powers and options (but none of the obligations) of the granting party thereunder, including, theimmediate continuing right to claim for, collect, receive and receipt for principal and interestpayments in respect of the Pledged Obligations, and all other Monies payable thereunder, to giveand receive notices and other communications, to make waivers or other agreements, to exerciseall rights and options, to bring Proceedings in the name of the granting party or otherwise, andgenerally to do and receive anything that the granting party is or may be entitled to do or receivethereunder or with respect thereto.
“Group Country”: Any Group I Country, Group II Country or Group III Country.
“Group I Country”: Australia, The Netherlands, The United Kingdom and NewZealand (or such other countries as may be notified byspecified in publicly available published criteria from Moody’s to the Investment Manager and the Collateral Administrator from time totime).
“Group II Country”: Germany, Ireland, Sweden and Switzerland (or such othercountries as may be notifiedspecified in publicly available published criteria from Moody’s from time to time and/or identified by Moody’s to the Investment Manager and the CollateralAdministrator from time to time).
“Group III Country”: Austria, Belgium, Denmark, Finland, France, Hong Kong, Iceland, Liechtenstein, Luxembourg and, Norway and Singapore (or such other countries as may
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be notifiedspecified in publicly available published criteria from Moody’s from time to time and/or identified by Moody’s to the Investment Manager and the Collateral Administrator fromtime to time).
“Hedge Agreement”: Any interest rate swap, floor and/or cap agreements,including, without limitation, one or more interest rate basis swap agreements, between theIssuer and any Hedge Counterparty, as amended from time to time, and any replacementagreement entered into pursuant to Section 16.1.
“Hedge Counterparty”: Any one or more institutions entering into orguaranteeing a Hedge Agreement with the Issuer that satisfies the Required Hedge CounterpartyRating that has entered into a Hedge Agreement with the Issuer, including any permittedassignee or successor under the Hedge Agreements.
“Hedge Counterparty Collateral Account”: Each account established pursuant toSection 10.4.
“Hedge Counterparty Credit Support”: As of any date of determination, any cashor cash equivalents on deposit in, or otherwise to the credit of, the Hedge CounterpartyCollateral Account in an amount required to satisfy the then-current Rating Agency criteria.
“High-Yield Bond”: A publicly issued or privately placed debt obligation of acorporation or other entity (other than a loan, Senior Secured Bond or Senior Secured Note).
“Holder”: (i) With respect to any Rated DebtNotes or Subordinated Note, thePerson whose name appears on the Register as the registered holder of such Note, except asotherwise provided for in this Indenture and Security Agreement, and, in the case of the Class A Loans, the Class A Lenders, and (ii) with respect to any Income Note, the Person in whose namesuch Income Note is registered in the Income Note Register, as notified by the Income NoteRegistrar to the Trustee, and, in each case, except where the context otherwise requires, “Holder”will include the beneficial owner of such security.
“Holder FATCA Information”: The information and documentation to beprovided by a Holder to the Issuer, the Trustee, the Income Note Paying Agent or the IncomeNote Issuer that is required to be requested by the Issuer or the Income Note Issuer (or theirrespective agents) or that is otherwise helpful or necessary (in all cases, in the sole discretion ofthe Issuer, the Income Note Issuer (or their respective agents)) to enable the Issuer or the IncomeNote Issuer, as applicable, to achieve FATCA Compliance.
“IAI”: An Accredited Investor as defined in Rule 501(a)(1), (2), (3) or (7) ofRegulation D of the Securities Act.
“IAI/QP”: Any Person that, at the time of its acquisition, purported acquisition orproposed acquisition of Notes is both (a) an IAI and (b) a Qualified Purchaser or an entity ownedexclusively by Qualified Purchasers.
“Incentive Management Fee”: The fee payable to the Investment Manager oneach Payment Date on and after which the Incentive Management Fee Threshold has been met,
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pursuant to Section 8 of the Investment Management Agreement and the Priority of Payments, inan amount (applicable on such Payment Date) equal to (x) 20% of any remaining InterestProceeds distributable pursuant to clause (VW) of Section 11.1(a)(i) and 20% of any remainingPrincipal Proceeds distributable pursuant to clause (J) of Section 11.1(a)(ii) or (y) 20% of anyremaining Interest Proceeds and Principal Proceeds distributable pursuant to clause (QI) ofSection 11.1(a)(iii).
“Incentive Management Fee Threshold”: The threshold that will be satisfied onany Payment Date if the Holders of the Subordinated Notes have received an annualized internalrate of return (computed using the “XIRR” function in Microsoft® Excel or an equivalentfunction in another software package and based on the respective dates of issuance and an aggregate purchase price of 100% for the Subordinated Notescalculated in accordance with Section 1.3(g)) of at least 12% on the outstanding investment in the Subordinated Notes as ofsuch Payment Date after giving effect to all payments made or to be made on such PaymentDate. For purposes of calculating the internal rate of return to determine whether the Incentive Management Fee Threshold has been met, the specified rate of return received by a Contributor with respect to any Contribution (other than any Cure Contributions) shall be deemed to have been distributed to, and received by, all of the holders of the Subordinated Notes proportionately, regardless of the holders of the Subordinated Notes that actually received such amounts.
“Income Note Administration Agreement”: An administration agreement, datedAugust 21, 2014, by and between the Income Note Administrator and the Income Note Issuer.
“Income Note Administrator”: MaplesFS Limited, as administrator of the IncomeNote Issuer.
“Income Note Issuer”: THL Credit Wind River Income Note 2014-2 Ltd., anexempted company incorporated with limited liability under the laws of the Cayman Islands.
“Income Note Paying Agency Agreement”: The Income Note Paying AgencyAgreement dated as of the Closing Date among the Income Note Issuer, the Income Note PayingAgent, the Income Note Registrar and the Income Note Administrator, as amended from time totime in accordance with the terms thereof.
“Income Note Paying Agent”: The Bank, solely in its capacity as Income NotePaying Agent under the Income Note Paying Agency Agreement, unless a successor Person shallhave become the Income Note Paying Agent pursuant to the applicable provisions of the IncomeNote Paying Agency Agreement, and thereafter, the Income Note Paying Agent shall mean suchsuccessor Person.
“Income Note Register”: The register maintained by the Income NoteAdministrator with respect to the Income Notes.
“Income Note Registrar”: The Bank, solely in its capacity as Income NoteRegistrar under the Income Note Paying Agency Agreement, unless a successor Person shallhave become the Income Note Registrar pursuant to the applicable provisions of the Income
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Note Paying Agency Agreement, and thereafter, the Income Note Registrar shall mean suchsuccessor Person.
“Income Note Registered Office Agreement”: The registered office agreement,dated August 21, 2014, by and between the Income Note Issuer and the Income NoteAdministrator.
“Income Notes”: The Income Notes due 2026[__] issued by the Income NoteIssuer shown as outstanding in the Income Note Register.
“Incurrence Covenant”: A covenant by the underlying obligor under a loan to comply with one or more financial covenants only upon the occurrence of certain actions of the underlying obligor or certain events relating to the underlying obligor, including, but not limited to, a debt issuance, dividend payment, share purchase, merger, acquisition or divestiture, unless, as of any date of determination, such action was taken or such event has occurred, in each case the effect of which causes such covenant to meet the criteria of a Maintenance Covenant.
“Indenture and Security Agreement”: This instrument as originally executed and,if from time to time supplemented or amended by one or more indenture and security agreementsindentures supplemental hereto entered into pursuant to the applicable provisionshereof, as so supplemented or amended.
“Independent”: As to any Person, any other Person (including, in the case of anaccountant or lawyer, a firm of accountants or lawyers, and any member thereof, or aninvestment bank and any member thereof) who (i) does not have and is not committed to acquireany material direct or any material indirect financial interest in such Person or in any Affiliate ofsuch Person, and (ii) is not connected with such Person as an Officer, employee, promoter,underwriter, voting trustee, partner, director or Person performing similar functions.“Independent” when used with respect to any accountant may include an accountant who auditsthe books of such Person if in addition to satisfying the criteria set forth above the accountant isindependent with respect to such Person within the meaning of Rule 101 of the Code ofProfessional Conduct of the American Institute of Certified Public Accountants. For purposes ofthis definition, no manager or director of any Person will fail to be Independent of such Personsolely because such manager or director acts as an independent manager or independent directorthereof or of any affiliates of such Person.
Whenever any Independent Person’s opinion or certificate is to be furnished tothe Trustee, such opinion or certificate shall state that the signer has read this definition and thatthe signer is Independent within the meaning hereof.
Any pricing service, certified public accountant or legal counsel that is required tobe Independent of another Person under this Indenture and Security Agreement must satisfy thecriteria above with respect to the Issuer and the Investment Manager.
“Independent Fiduciary”: The meaning specified in Section 2.6(c).
“Index Maturity”: [With respect to any Class of Rated DebtNotes, the periodindicated with respect to such Class in Section 2.3; provided, that, if the Amendment Date is not
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a Payment Date, with respect to the portion of the first Interest Accrual Period comprising theperiod from the ClosingAmendment Date to but excluding the First LIBOR Period Endfirst Payment Date thereafter, LIBOR will be determined by interpolating linearly between (i) theraterates appearing on the Reuters Screen for deposits with a term of one month and (ii) the rate appearing on the Reuters Screen for deposits with athe next shorter period of time for which rates are available and the next longer period of time for which rates are available, respectively, based on the term of two months.such period.]
“Information Agent”: The meaning specified in Section 14.15.
“Initial Majority Subordinated Noteholder”: The party, together with its Affiliates, (as notified by the Issuer to the Trustee as of the Closing Date) that beneficially ownsat least a Majority of the Subordinated Notes (which shall include, for this purpose, any indirectownership of Subordinated Notes through the ownership of Income Notes) as of the ClosingDate.
“Initial Majority Subordinated Noteholder Condition”: A condition that issatisfied as ofat any date of determination so long astime that the Initial Majority SubordinatedNoteholder and its Affiliates have certified that such Persons have owned, since the Closing Date to such date of determination, continually owned at least a Majority of the Subordinated Notes(which shall include, for this purpose, any indirect ownership of Subordinated Notes through theownership of Income Notes). The Trustee shall be entitled to assume without investigation that such condition is satisfied unless and until otherwise notified by the Issuer.
“Initial Rating”: With respect to any Class of Rated DebtNotes, the rating orratings, if any, indicated in Section 2.3.
“Instrument”: The meaning specified in Section 9-102(a)(47) of the UCC.
“Interest Accrual Period”: (i) With respect to the initial Payment Date, the periodfrom and including the Closing Date (or, in the case of a Refinancing on a non-Payment Date,the date of issuance of the replacement notes or loans) to but excluding such Payment Date; and(ii) with respect to each succeeding Payment Date, the period from and including theimmediately preceding Payment Date to but excluding the following Payment Date until theprincipal of the Rated Debt isNotes are paid or made available for payment; provided, that anyinterest bearing notes issued, or loans incurred, after the Closing Date in accordance with theterms of this Indenture and Security Agreement and the Credit Agreement shall accrue interestduring the Interest Accrual Period in which such additional notes are issued or loans are incurred from and including the applicable date of issuance of such additional notes or incurrence of such loans to but excluding the last day of such Interest Accrual Period at the applicable interest ratefor such notes or such loans.
“Interest Collection Subaccount”: The meaning specified in Section 10.2(b).
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“Interest Coverage Ratio”: With respect to any designated Class or Classes ofRated DebtNotes, as of any Measurement Date on or after the Determination Date immediatelypreceding the third Payment Date, the percentage derived by dividing:
the sum of (i) the Collateral Interest Amount as of such date of(a)determination minus (ii) amounts payable (or expected as of the date of determination to bepayable) on the following Payment Date as set forth in clauses (A), (B) and (C) of Section 11.1(a)(i); by
interest due and payable on the Rated DebtNotes of such Class or Classes(b)and each Priority Class of Rated DebtNotes on such Payment Date (excluding Deferred Interest, any Class X Principal Amortization Amount and any Unpaid Class X Principal Amortization Amount but including any interest on Deferred Interest with respect to any such Class orClasses).
“Interest Coverage Test”: A test that is satisfied with respect to any specifiedClass of Rated DebtNotes (other than, for the avoidance of doubt, the Class X Notes, the Class E Notes or the Class F Notes), if as of the Determination Date immediately preceding the thirdPayment Date, and at any date of determination occurring thereafter (i) the Interest CoverageRatio for such Class is at least equal to the applicable Required Coverage Ratio for such Class,or (ii) such Class is no longer Outstanding.
“Interest Determination Date”: With respect to each Interest Accrual Period, thesecond London Banking Day preceding the first day of each Interest Accrual Period; providedthat for the first Interest Accrual Period beginning on the Amendment Date, “InterestDetermination Date” shall mean (i) for the period from the Closing Date to but excluding the First LIBOR Period End Date, the second London Banking Day preceding the Closing Date and (ii) for the remainder of the first Interest Accrual Period, the second London Banking Day preceding the First LIBOR Period EndAmendment Date.
“Interest Proceeds”: With respect to any Collection Period or DeterminationDate, without duplication, the sum of: (i) all payments of interest and other income (other thanany interest due on any Deferrable Obligation that has been deferred or capitalized at the time ofacquisition) received by the Issuer during the related Collection Period on the CollateralObligations and Eligible Investments, including the accrued interest received in connection witha sale thereof during the related Collection Period, less any such amount that represents PrincipalFinanced Accrued Interest; (ii) all principal and interest payments received by the Issuer duringthe related Collection Period on Eligible Investments purchased with Interest Proceeds; (iii) allamendment and waiver fees, late payment fees, ticking fees and other fees received by the Issuerduring the related Collection Period, except for those in connection with (a) the lengthening of the maturity of the related Collateral Obligation or (b) the reduction of the par of the related Collateral Obligation as determined by; (iv) all premiums (including prepayment premiums) received during such Collection Period on the Collateral Obligations, provided that theInvestment Manager at its discretion (with notice to the Collateral Agent and the Collateral Administrator); (ivmay in its sole discretion designate prepayment premiums as Principal Proceeds; (v) any payment received with respect to any Hedge Agreement other than (a) an
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upfront payment received upon entering into such Hedge Agreement or (b) a payment receivedas a result of the termination of any Hedge Agreement to the extent not used by the Issuer toenter into a new or replacement Hedge Agreement; (vvi) any payments received as repaymentfor Excepted Advances; (vivii) any amounts deposited in the Interest Collection Subaccountfrom the Expense Reserve Account or the Ramp-Up Account pursuant to Section 10.3 in respectof the related Determination Date; (viiviii) any proceeds from Issuer Subsidiary Assets receivedby the Issuer from any Issuer Subsidiary to the same extent as such proceeds would haveconstituted “Interest Proceeds” pursuant to this definition if received directly by the Issuer fromthe obligors of the Issuer Subsidiary Assets; (viiiix) commitment fees, letter of credit fees andother similar fees received by the Issuer during such Collection Period in respect of RevolvingCollateral Obligations and Delayed Drawdown Collateral Obligations and (ix; (x) any amounts designated as Interest Proceeds from the Permitted Use Account (including but not limited to (a)amounts designated as Interest Proceeds from the net proceeds of the additional issuance ofSubordinated Notes and/or Junior Mezzanine Notes pursuant to Section 2.4, (b) Contributions designated as Interest Proceeds by the Contributor (or the Investment Manager, as applicable) or (c) any Redirected Fee Interest); and (xi) any Designated Excess Par; provided that any amountsreceived in respect of any Defaulted Obligation (including, to the extent such DefaultedObligation is an Issuer Subsidiary Asset, any such proceeds from such Issuer Subsidiary inrespect of such Issuer Subsidiary Asset) will constitute (A) Principal Proceeds (and not InterestProceeds) until the aggregate of all recoveries in respect of such Defaulted Obligation (includingany such proceeds from such Issuer Subsidiary, in respect of each Issuer Subsidiary Asset) sinceimmediately before it became a Defaulted Obligation equals the outstanding Principal Balance(excluding any unfunded commitment on any Revolving Collateral Obligation or DelayedDrawDrawdown Collateral Obligation) of such Collateral Obligation immediately before itbecame a Defaulted Obligation, and then (B) Interest Proceeds thereafter; provided, further, thatamounts described in clause (i) of the definition of Principal Financed Accrued Interest may, at any time during the Collection Period in which such funds are received, be designated by theInvestment Manager as Interest Proceeds as long as the date of such designation (a) the Aggregate Principal Balance on the date of such designation of the (a) Collateral Obligations(solely for the purposes of this clause (a),and the Aggregate Principal Balance of any Defaulted Obligation shall be deemed to be equal to the Market Value of such Defaulted Obligation) and (b)the Eligible Investments representing Principal Proceeds equals or exceeds the AggregateRamp-Up Par Amount (on a pro forma basis); provided, further, that amounts that wouldotherwise constitute Interest Proceeds may be designated as Principal Proceeds pursuant toSection 7.17(c) with notice to the Collateral Administrator. Notwithstanding the foregoing, inthe Investment Manager’s sole discretion (to be exercised on or before the related DeterminationDate), on any date after the first Payment Date, Interest Proceeds in any Collection Period maybe deemed to be Principal Proceeds with the consent of the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder Condition is satisfied) solong as no such designation would result in an interest deferral on any Class of Rated DebtNotes.Under no circumstances shall Interest Proceeds include the Excepted Property or any interestearned thereon.
“Interest Reserve Account”: The trust account established pursuant to Section 10.3(e).
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“Investment Advisers Act”: The Investment Advisers Act of 1940, as amendedfrom time to time.
“Investment Company Act”: The Investment Company Act of 1940, as amendedfrom time to time.
“Investment Criteria”: The criteria specified in Section 12.2.
“Investment Criteria Adjusted Balance”: With respect to any Asset, the PrincipalBalance of such Asset; provided that for all purposes the Investment Criteria Adjusted Balanceof any: (i) Deferring Obligation shall be the Moody’s Collateral Value of such Deferring Obligationthereof; (ii) Discount Obligation shall be the product of (A) the purchase price of suchDiscount Obligation (expressed as a percentage of par) and (B) the Principal Balance of suchDiscount Obligation; and (iii) CCC/Caa Collateral Obligation included in either the CCC Excess or the Caa Excess shall be the Market Value of such CCC/Caa Collateral Obligation; provided,further, that the Investment Criteria Adjusted Balance for any Collateral Obligation that satisfiesmore than one of the definitions of Deferring Obligation, Discount Obligation or CCC/CaaCollateral Obligation shall be the lowest amount determined pursuant to clauses (i), (ii) or (iii).
“Investment Management Agreement”: The Investment Management Agreement,dated as of the Closing Date, between the Issuer and the Investment Manager relating to themanagement of the Collateral Obligations and the other Assets and the performance of certainother advisory functions by the Investment Manager on behalf of the Issuer, as amended fromtime to time in accordance with the terms hereof and thereof.
“Investment Manager”: THL Credit Advisors LLC, a Delaware limited liabilitycompany, until a successor Person shall have become the Investment Manager pursuant to theprovisions of the Investment Management Agreement, and thereafter “Investment Manager”shall mean such successor Person.
“Irish Listing Agent”: The meaning specified in Section 7.2.
“Issuer”: THL Credit Wind River 2014-2 CLO Ltd., until a successor Personshall have become the Issuer pursuant to the applicable provisions of this Indenture and Security Agreement, and thereafter “Issuer” shall mean such successor Person.
“Issuer Order”: A written order dated and signed in the name of the Issuer or theCo-Issuer (which written order may be a standing order) by an Authorized Officer of the Issueror the Co-Issuer, as applicable, or, to the extent permitted herein or in the InvestmentManagement Agreement, by the Investment Manager by an Authorized Officer thereof, onbehalf of the Issuer.
“Issuer Subsidiary”: An entity treated at all times as a corporation for U.S.federal income tax purposes, 100% of the equity interests in which are owned directly orindirectly by the Issuer.
“Issuer Subsidiary Asset”: The meaning specified in Section 7.16(j).
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“Junior Class”: With respect to a particular Class of DebtNotes, each Class ofDebtNotes that is subordinated to such Class, as indicated in Section 2.3.
“Junior Mezzanine Notes”: The meaning specified in Section 2.4(a).2.4.
“Knowledgeable Employee”: The meaning specified in Rule 3c-5 under theInvestment Company Act.
“Letter of Credit Reimbursement Obligation”: Any letter of credit facility that (a)requires a lender party thereto to pre-fund in full its obligations thereunder and (b) provides thatsuch lender (i) shall have no further funding obligation thereunder and (ii) shall have a right tobe reimbursed or repaid by the borrower its pro rata share of any draws on a letter-of-creditissued thereunder.
“LIBOR”: (i) With respect to the Rated Debt, the meaning set forth in Exhibit C and (ii) with respect to a Collateral Obligation (other than a Collateral Obligation that bears interest based on a floating rate index other than a London interbank offered rate-based index), the “libor” rate determined in accordance with the terms of such Collateral Obligation.LIBOR means:
with respect to the Rated Notes, for any Interest Accrual Period (i)will equal (a) the rate appearing on the Reuters Screen for deposits with a term of the Index Maturity or (b) if such rate is unavailable at the time LIBOR is to be determined, LIBOR will be determined on the basis of the rates at which deposits in U.S. Dollars are offered by major banks in the London market selected by the Calculation Agent after consultation with the Investment Manager (the “Reference Banks”) at approximately 11:00 a.m., London time, on the Interest Determination Date to prime banks in the London interbank market for a period approximately equal to the Interest Accrual Period and an amount approximately equal to the amount of the Aggregate Outstanding Amount of the Rated Notes. The Calculation Agent will request the principal London office of each Reference Bank to provide a quotation of its rate. If at least two such quotations are provided, LIBOR will be the arithmetic mean of such quotations (rounded upward to the next higher 1/100,000). If fewer than two quotations are provided as requested, LIBOR with respect to such Interest Accrual Period will be the arithmetic mean of the rates quoted by three major banks in New York, New York selected by the Calculation Agent after consultation with the Investment Manager at approximately 11:00 a.m., New York Time, on such Interest Determination Date for loans in U.S. Dollars to leading European banks for a term approximately equal to such Interest Accrual Period and an amount approximately equal to the Aggregate Outstanding Amount of the Rated Notes (rounded upward to the next higher 1/100). If the Calculation Agent is required but is unable to determine a rate in accordance with at least one of the procedures described above, LIBOR will be LIBOR as determined on the previous Interest Determination Date; and
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with respect to a Collateral Obligation (other than a Collateral (ii)Obligation that bears interest based on a floating rate index other than a London interbank offered rate based index), the “libor” rate determined in accordance with the terms of such Collateral Obligation.
Notwithstanding the foregoing and without any amendment or supplement hereto, (a) if at any time while any Rated Notes are outstanding, there is a LIBOR Disruption or Libor ceases be reported on the Reuters Screen, the Investment Manager (on behalf of the Issuer) may select (with notice to the Trustee, the Calculation Agent and the Collateral Administrator) an alternative rate that in its commercially reasonable judgment satisfies the conditions specified in the definition of Designated Base Rate (the “Temporary Alternative Rate”) and all references herein to “LIBOR” will mean such Temporary Alternative Rate, until the beginning of the first Interest Accrual Period after the execution and effectiveness of a Base Rate Amendment, if any, and (b) from and after the first Interest Accrual Period to begin after the execution and effectiveness of a Base Rate Amendment, all references herein to “LIBOR” will mean such Alternate Base Rate specified in such Base Rate Amendment.
“LIBOR Disruption”: The occurrence of any of the events, conditions or circumstances specified in clauses (x), (y) or (z) of Section 8.1(xxv).
“Libor Floor Obligation”: As of any date, a floating rate Collateral Obligation (a)for which the related Underlying Instruments allow a libor rate option, (b) that provides that suchlibor rate is (in effect) calculated as the greater of (i) a specified “floor” rate per annum and (ii)the London interbank offered rate for the applicable interest period for such CollateralObligation and (c) that, as of such date, bears interest based on such libor rate option, but only ifas of such date the London interbank offered rate for the applicable interest period is less thansuch floor rate.
“Listed Notes”: The Notes specified as such in Section 2.3.
“Loan Agent”: The Bank of New York Mellon Trust Company, National Association, as loan agent under the Credit Agreement.
“London Banking Day”: A day on which commercial banks are open for business(including dealings in foreign exchange and foreign currency deposits) in London, England.
“Long Dated Obligation”: Any Collateral Obligation with a Collateral Obligation Maturity after the earlier of (A) the original Stated Maturity of the Rated Notes specified in Section 2.3 and (B) if the Stated Maturity of any Class of Rated Notes is changed after the Closing Date, the earliest Stated Maturity applicable to any Class of Rated Notes.
“Maintenance Covenant”: As of any date of determination, a covenant by theunderlying obligorObligor of a loan to comply with one or more financial covenants during eachreporting period applicable to such loan, whether or not any action by, or event relating to, theunderlying obligorObligor occurs after such date of determination; provided that a covenant that otherwise satisfies the definition hereof and only applies when amounts are outstanding under the related loan shall be a Maintenance Covenant.
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“Majority”: With respect to (i) any Class of DebtNotes, the Holders of more than50% of the Aggregate Outstanding Amount of the Debt of such Class and (ii) the Section 13 Banking Entities, more than 50% of the Aggregate Outstanding Amount of the Debt held by such Section 13 Banking Entities.“Manager Approval Condition”: As of any date of determination, if the Investment Manager has determined (in its commercially reasonable judgment based upon advice or opinion of Winston & Strawn LLP or another nationally recognized counsel experienced in such matters, the basis of such determination to be communicated to the Initial Majority Subordinated Noteholder, promptly following such determination (which communication by the Investment Manager may be telephonic or other oral communication)) that an action would likely require the Investment Manager to comply with the risk retention requirements in Section 15G of the Exchange Act and the related regulations, a condition that is satisfied upon the affirmative written consent of the Investment Manager to such actionNotes of such Class.
“Management Fee Interest”: Collectively, the Senior Management Fee Interest,the Subordinated Management Fee Interest and the Deferred Management Fee Interest.
“Management Fees”: Collectively, the Senior Management Fee, the SubordinatedManagement Fee, the Deferred Management Fees and the Incentive Management Fee.
“Manager Change in Law Notice”: A notice provided by the Investment Manager to the holders of the Subordinated Notes that directed the Refinancing or Re-Pricing, which states a change in law, regulation or interpretation thereof by a regulatory agency relating to the U.S. Risk Retention Rules has occurred which changes the requirements for risk retention compliance for the Issuer and/or the Investment Manager, which has a material adverse effect on the Investment Manager as determined in its commercially reasonable judgment based upon the advice of nationally recognized counsel experienced in such matters (an oral or written summary of such legal advice to be provided to the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder holds a Majority of the Subordinated Notes)). For the avoidance of doubt, any change requiring the retention of a larger retained interest will be deemed to materially adversely affect the Investment Manager.
“Margin Stock”: “Margin Stock” as defined under Regulation U issued by theFederal Reserve Board, including any debt security which is by its terms convertible into“Margin Stock.”
“Market Value”: With respect to any loans or other assets, the amount(determined by the Investment Manager) equal to the product of the principal amount thereofand the price determined in the following manner:
(A) in the case of a loan only, the bid quote determinedprovided by(i)an Approvedany of Loan Pricing Service or (B) in the case of a bond only, Interactive Data Corporation, MarkIt Partners, IDC (with respect to bonds only)or NASD’s TRACE or, in either case, any other nationally recognized loanpricing service, as applicable, selected by the Investment Manager;, or
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if asuch bid quote described in clause (i) is not available,(A)(ii)the average of the bid-side quotes determined by three broker-dealers active in thetrading of such asset that are Independent from(with respect to each other and theIssuer and the Investment Manager); or
(B) if only two such bids can be obtained, the lower of the(A)bid-side quotes of such two bids; or
(C) if only one such bid can be obtained, and such bid was (B)obtained from a Qualified Broker/Dealer, the bid-side quote of such bid;or
if asuch bid quotequotes described in clause (i) or (ii) is not(iii)available, then the Market Value of an asset will be the lower of (x)(A) if the Investment Manager is not registered under the Investment Advisers Act, the bid quote at which the Investment Manager reasonably believes such asset could be sold in the market within 30 days, as certified by the Investment Manager to the Trustee andsuch Collateral Obligation shall be the Market Value determined bythe Investment Manager exercising reasonable commercial judgment, consistentwith the manner in which it would determine the market valueMarket Value of anasset for purposes of other funds or accounts managed by it; provided,howeverthat, if the Investment Manager is not a registered investment advisor under the Investment Advisers Act, the Market Value of any such asset may notbe determined in accordance with this clause (iii)(x)(A) for more than 30 days or (B) if the Investment Manager is registered under the Investment Advisers Act, the bid quote at which the Investment Manager reasonably believes such asset could be sold in the market within 30 days, as certified by the Investment Manager to the Trustee; and (y) solely if such asset either was purchased within the three preceding months or was previously assigned a Market Value within the three preceding months in accordance with clause (i) or (ii), either (A) if such asset was purchased within the three preceding months, its purchase price or (B) otherwise, the last Market Value that was assigned to it for more than thirty (30) days; or
if the Market Value of an asset is not determined in accordance(iv)with clause (i), (ii) or (iii) above, then suchthe Market Value shall be deemed tobe zero until such determination is made in accordance with clause (i), or (ii) or (iii) above.
“Maturity”: With respect to any DebtNote, the date on which the unpaid principalof such DebtNote becomes due and payable as therein or herein provided, whether at the StatedMaturity or by declaration of acceleration, call for redemption or otherwise.
“Maturity Amendment”: The meaning specified in Section 12.2(e).
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“Maximum Investment Amount”: As of any date of determination, the sum of,without duplication, (a) the Collateral Principal Amount, (b) the outstanding principal amount ofall Defaulted Obligations that have been Defaulted Obligations for longer than three years and(c) the aggregate amount of all Principal Financed Accrued Interest.
“Maximum Moody’s Rating Factor Test”: A test that will be satisfied on any dateof determination if the Moody’s Adjusted Weighted Average Rating Factor of the CollateralObligations is less than or equal to the sum of (a) the number set forth in the column entitled“Maximum Moody’s Weighted Average Rating Factor” in the Asset Quality Matrix, based uponthe applicable “row/column combination” chosen by the Investment Manager with notice to theCollateral Administrator (or the linear interpolation between two adjacent rows and/or twoadjacent columns, as applicable) in accordance with Section 7.17(e), plus (b) the Moody’sWeighted Average Recovery Adjustment, plus (c) the Moody’s Weighted Average Spread Adjustment; provided that, if the Aggregate Principal Balance of the Collateral Obligations (excluding any Defaulted Obligations) exceeds the Reinvestment Target Par Balance, the Collateral Obligations included in the calculation of the Moody’s Weighted Average Rating Factor shall be only those Collateral Obligations with an Aggregate Principal Balance equal to the Reinvestment Target Par Balance (starting with Collateral Obligations with the lowest Moody’s Rating Factors).
“Measurement Date”: (i) Any day on which the Issuer purchases, or enters into acommitment to purchase, a Collateral Obligation or promptly after an Officer of the InvestmentManager becomes aware that a default of a Collateral Obligation has occurred, (ii) anyDetermination Date, (iii) the date as of which the information in any Monthly Report orDistribution Report is calculated, (iv) with five 5 Business Days prior written notice, anyBusiness Day requested by either Rating Agency then rating any Class of OutstandingDebtNotes and (v) the last day of the Ramp-Up Period; provided that in the case of (i) through(iv), no “Measurement Date” can occur prior to the last day of the Ramp-Up Period.
“Memorandum and Articles”: The Issuer’s Memorandum and Articles ofAssociation, as they may be amended, revised or restated from time to time.
“Merging Entity”: The meaning specified in Section 7.10.
“Minimum Fixed Coupon Test”: A test that will be satisfied on any date ofdetermination if (x) the Weighted Average Fixed Coupon equals or exceeds [7.0]% or (y) theAggregate Principal Balance of Collateral Obligations bearing interest at fixed rates is zero.
“Minimum Floating Spread”: The number set forth in the column entitled“Minimum Weighted Average Spread” in the Asset Quality Matrix based upon the applicable“row/column combination” chosen by the Investment Manager with notice to the Trustee, the Collateral Agent and the Collateral Administrator (or the linear interpolation between twoadjacent rows and/or two adjacent columns, as applicable) in accordance with Section 7.17(e),reduced by the Moody’s Weighted Average Recovery Adjustment; provided, that the MinimumFloating Spread shall in no event be lower than 2.65[__]%.
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“Minimum Floating Spread Test”: The test that is satisfied on any date ofdetermination if the Weighted Average Floating Spread equals or exceeds the Minimum FloatingSpread.
“Money”: The meaning specified in Section 1-201(24) of the UCC.
“Monthly Report”: The meaning specified in Section 10.6(a).
“Monthly Report Determination Date”: The meaning specified in Section 10.6(a).
“Moody’s”: Moody’s Investors Service, Inc. and any successor thereto.
“Moody’s Adjusted Weighted Average Rating Factor”: As of any date ofdetermination, a number equal to the Moody’s Weighted Average Rating Factor determined inthe following manner: for purposes of determining a Moody’s Default Probability Rating,Moody’s Rating or Moody’s Derived Rating in connection with determining the Moody’sWeighted Average Rating Factor for purposes of this definition, the last paragraph of thedefinition of each of “Moody’s Default Probability Rating” and “Moody’s Derived Rating” andthe penultimate paragraph of the definition of “Moody’s Rating” shall be disregarded, andinstead each applicable rating on credit watch by Moody’s that is on (a) positive watch will betreated as having been upgraded by one rating subcategory, (b) negative watch will be treated ashaving been downgraded by two rating subcategories, (c) positive outlook will not be treated ashaving been upgraded by any rating subcategories and (d) negative outlook will be treated ashaving been downgraded by one rating subcategory.
“Moody’s Collateral Value”: As of any date of determination, with respect to anyDefaulted Obligation or Deferring Obligation, the lesser of (i) the Moody’s Recovery Amount ofsuch Defaulted Obligation or Deferring Obligation as of such date and (ii) the Market Value ofsuch Defaulted Obligation or Deferring Obligation as of such date.
“Moody’s Counterparty Criteria”: With respect to any Participation Interestproposed to be acquired by the Issuer, criteria that will be met if immediately after giving effectto such acquisition, (x) the percentage of the Collateral Principal Amount that consists in theaggregate of Participation Interests with Selling Institutions that have the same or a lowerMoody’s credit rating does not exceed the “Aggregate Percentage Limit” set forth below forsuch Moody’s credit rating and (y) the percentage of the Collateral Principal Amount thatconsists in the aggregate of either Participation Interests with any single Selling Institution thathas the Moody’s credit rating set forth under “Individual Percentage Limit” below or a lowercredit rating does not exceed the “Individual Percentage Limit” set forth below for such Moody’scredit rating:
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Moody’s credit rating ofSelling Institution
(at or below)
AggregatePercentage
Limit
IndividualPercentage
LimitAaa 20.0% 20.0%Aa1 20.0% 10.0%Aa2 20.0% 10.0%Aa3 15.0% 10.0%A1 10.0% 5.0%
A2 and “P-1” 5.0% 5.0%A3 0% 0%
“Moody’s Default Probability Rating”: With respect to any Collateral Obligation,the rating determined pursuant to Schedule 4.
“Moody’s Derived Rating”: With respect to any Collateral Obligation whoseMoody’s Rating or Moody’s Default Probability Rating cannot otherwise be determinedpursuant to the definitions thereof, the rating determined for such Collateral Obligation as setforth in Schedule 4.
“Moody’s Diversity Test”: A test that will be satisfied on any date ofdetermination if the Diversity Score (rounded to the nearest whole number) equals or exceeds thenumber set forth in the column entitled “Minimum Diversity Score” in the Asset Quality Matrixbased upon the applicable “row/column combination” chosen by the Investment Manager withnotice to the Trustee, the Collateral Agent and the Collateral Administrator (or the linearinterpolation between two adjacent rows and/or two adjacent columns, as applicable) inaccordance with Section 7.17(e).
“Moody’s Effective Date Deemed Rating Confirmation”: The meanings specifiedin Section 7.17(b).
“Moody’s Industry Classification”: The industry classifications set forth inSchedule 1, as such industry classifications shall be updated at the sole option of the InvestmentManager (with notice to the Trustee and the Collateral Administrator) if Moody’s publishesrevised industry classifications.
“Moody’s Minimum Weighted Average Recovery Rate Test”: The test that willbe satisfied on any date of determination if the Moody’s Weighted Average Recovery Rate plus the Moody’s Rating Factor Adjustment equals or exceeds 48.5[43.0]%.
“Moody’s Ramp-Up Failure”: The meaning specified in Section 7.17(c).
“Moody’s Rating”: With respect to any Collateral Obligation, as of any date of determination, the rating determined in accordance with the following methodology:The meaning specified in [Schedule 4].
(i) With respect to a Collateral Obligation that (A) is publicly rated by Moody’s, such public rating, or (B) is not publicly rated by Moody’s but for
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which a rating or rating estimate has been assigned by Moody’s upon the request of the Issuer or the Investment Manager, such rating or, in the case of a rating estimate, the applicable rating estimate for such obligation;
(ii) With respect to a Collateral Obligation that is a Moody’s Senior Secured Loan or Participation Interest in a Moody’s Senior Secured Loan, if not determined pursuant to clause (i) above, if the obligor of such Collateral Obligation has a corporate family rating by Moody’s, then the Moody’s rating that is one subcategory higher than such corporate family rating;
(iii) With respect to a Collateral Obligation, if not determined pursuant to clause (i) or (ii) above, if the obligor of such Collateral Obligation has one or more senior unsecured obligations publicly rated by Moody’s, then the Moody’s public rating on any such obligation (or, if such Collateral Obligation is a Moody’s Senior Secured Loan or Participation Interest in a Moody’s Senior Secured Loan, the Moody’s rating that is two subcategories higher than the Moody’s public rating on any such senior unsecured obligation) as selected by the Investment Manager in its sole discretion; and
(iv) With respect to a Collateral Obligation, if not determined pursuant to clause (i), (ii) or (iii) above, the Moody’s Derived Rating.
For purposes of calculating a Moody’s Rating, each applicable rating, at the time of calculation, (i) on credit watch by Moody’s with positive implications will be treated as having been upgraded by one rating subcategory, (ii) on credit watch by Moody’s with negative implications will be treated as having been downgraded by one rating subcategory and (iii) on either negative outlook or positive outlook by Moody’s will not be treated as having been downgraded or upgraded by any rating subcategories.
With respect to any credit estimate assigned by Moody’s to a Collateral Obligation hereunder, the Issuer (or the Investment Manager on the Issuer’s behalf) shall send to Moody’s the related Obligor’s updated financial information upon receipt thereof from such Obligor and will use commercially reasonable efforts to obtain such information at least (x) annually and (y) upon any significant change in the financial condition of such Obligor (as determined by the Investment Manager in its commercially reasonably business judgment) but (in each case) only to the extent such Obligor is required to provide it pursuant to the Underlying Instruments.
“Moody’s Rating Condition”: With respect to any action taken or to be taken byor on behalf of the Issuer, a condition that is satisfied if Moody’s has confirmed in writing, including electronic messages, facsimile, press release, posting to its internet website, or other means then considered industry standard (or has declined to undertake the review of such action by such means(which confirmation may be in the form of a press release) to the Issuer, theTrustee, the Collateral Agent and/or the Investment Manager that no immediate withdrawal orreduction with respect to its then -current rating by Moody’s of any Class of the Rated DebtRated Notes with an outstanding solicited rating from Moody’s will occur as a result ofsuch action; provided that if Moody’s (a) makes a public announcement or informsthe Moody’s
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Rating Condition will (i) be deemed to be not applicable with respect to any Class of Notes that receives a solicited rating from Moody’s that is not outstanding or rated by Moody’s at such time or (ii) not be required if (a) Moody’s makes a public statement to the effect that it will no longer review events or circumstances of the type requiring satisfaction of the Moody’s Rating Condition in this Indenture for purposes of evaluating whether to confirm the then-current ratings (or initial ratings) of obligations rated by it; (b) Moody’s communicates to the Issuer, theInvestment Manager, the Collateral Agent or the Trustee (or their counsel) that (i) it believes the Moody’s Rating Condition is not required with respect to an action or (ii) its practice or policy is to not give such confirmations, (b) it no longer constitutes a Rating Agency under this Indenture and Security Agreement or (c) the Rated Debt rated by Moody’s on the Closing Date are no longer Outstanding, the Moody’s Rating Condition will not applyit will not review such event or circumstance for purposes of evaluating whether to confirm the then-current ratings (or initial ratings) of the Rated Notes; (c) with respect to amendments requiring unanimous consent of all Holders of Notes, such Holders have been advised prior to consenting that the current ratings of the Rated Notes may be reduced or withdrawn as a result of such amendment; (d) confirmation has been requested from Moody’s (via email to [email protected]) at least three separate times during a fifteen (15) Business Day period and Moody’s has either not made any response to such requests or has not indicated in response to any such request that it will consider the application for satisfaction of the Moody’s Rating Condition; or (e) no Class of Rated Notes are then rated by Moody’s.
“Moody’s Rating Factor”: For each Collateral Obligation, the number set forth inthe table below opposite the Moody’s Default Probability Rating of such Collateral Obligation.
Moody’s DefaultProbability Rating
Moody’s RatingFactor
Moody’s DefaultProbability Rating
Moody’s RatingFactor
Aaa 1 Ba1 940Aa1 10 Ba2 1,350Aa2 20 Ba3 1,766Aa3 40 B1 2,220A1 70 B2 2,720A2 120 B3 3,490A3 180 Caa1 4,770
Baa1 260 Caa2 6,500Baa2 360 Caa3 8,070Baa3 610 Ca or lower 10,000
“Moody’s Rating Factor Adjustment”: As of any date of determination, the lower of (1) 18.5% and (2) the percentage obtained from (a) the positive difference (if any) of (i) the number set forth in the column entitled “Maximum Moody’s Weighted Average Rating Factor” in the Asset Quality Matrix, based upon the applicable “row/column combination” chosen by the Investment Manager with notice to the Collateral Administrator (or the linear interpolation between two adjacent rows and/or two adjacent columns, as applicable) in accordance with Section 7.17(e) minus (ii) the Moody’s Adjusted Weighted Average Rating Factor on such date of determination, divided by (b) 7000.“Moody’s Recovery Amount”: With respect to anyCollateral Obligation, an amount equal to the product of (i) the applicable Moody’s RecoveryRate and (ii) the Principal Balance of such Collateral Obligation.
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“Moody’s Recovery Rate”: With respect to any Collateral Obligation, as of anydate of determination, the recovery rate determined in accordance with the following, in thefollowing order of priority:
if the Collateral Obligation has been specifically assigned a(i)recovery rate by Moody’s (for example, in connection with the assignment byMoody’s of an estimated rating), such recovery rate;
if the preceding clause does not apply to the Collateral Obligation,(ii)and the Collateral Obligation is a Moody’s Senior Secured Loan, Second LienLoan, Senior Secured Bond, Moody’s Senior Secured Floating Rate Note, Unsecured Bond, Unsecured Loan or other Collateral Obligation (in each caseother than a DIP Collateral Obligation), the rate determined pursuant to the tablebelow based on the number of rating subcategories difference between theCollateral Obligation’s Moody’s Rating and its Moody’s Default ProbabilityRating (for purposes of clarification, if the Moody’s Rating is higher than theMoody’s Default Probability Rating, the rating subcategories difference will bepositive and if it is lower, negative):
Number ofMoody’s Ratings
SubcategoriesDifference Between theMoody’s Rating and the
Moody’s DefaultProbability Rating
Moody’s Senior SecuredLoans excluding
First-Lien Last-Out Loan
Second Lien Loans, Senior Secured Bonds,
First-Lien Last-Out Loans and Moody’s
Senior Secured Floating Rate Notes (providedthat such Collateral
Obligations must haveboth a corporate family
rating and aninstrument rating
assigned by Moody’s) and First-Lien Last-Out
Loans
Unsecured Loans, Unsecured Bonds and
all other CollateralObligations that do notfall under the previous
two columns
+2 or more 60.0% 55.0% 45.0%+1 50.0% 45.0% 35.0%0 45.0% 35.0% 30.0%-1 40.0% 25.0% 25.0%-2 30.0% 15.0% 15.0%
-3 or less 20.0% 5.0% 5.0%or
if the Collateral Obligation is a DIP Collateral Obligation (other(iii)than a DIP Collateral Obligation which has been specifically assigned a recoveryrate by Moody’s), 50%.
“Moody’s Senior Secured Floating Rate Note”: A senior secured floating rate note that (x) has a Moody’s facility rating and the obligor of such note has a Moody’s corporate family rating and (y) such Moody’s facility rating is not lower than such Moody’s corporate family rating.
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“Moody’s Senior Secured Loan”: The meaning specified in Schedule 4.
“Moody’s Weighted Average Rating Factor”: The number (rounded up to thenearest whole number) determined by dividing (I) the sum of the product of (a) the PrincipalBalance of each Collateral Obligation (excluding any Current Pay Obligation and DefaultedObligation) times (b) the Moody’s Rating Factor of such Collateral Obligation by (II) theAggregate Principal Balance of all such Collateral Obligations.
“Moody’s Weighted Average Recovery Adjustment”: As of any date ofdetermination, the greater of (a) zero and (b) the product of (i)(A) the Moody’s WeightedAverage Recovery Rate as of such date of determination multiplied by 100 minus (B) 48.5[43]and (ii) (A) with respect to the adjustment of the Maximum Moody’s Rating Factor Test, 70 and (B) with respect to the adjustment of the Minimum Floating Spread, 0.10%; provided, however,the “Recovery Rate Modifier” in the Recovery Rate Modifier Matrix that corresponds to the applicable “row/column combination”; provided that if the Moody’s Weighted AverageRecovery Rate for purposes of determining the Moody’s Weighted Average RecoveryAdjustment is greater than 60.060%, then such Moody’s Weighted Average Recovery Rate shallequal 60.060% unless the GlobalMoody’s Rating Agency Condition is satisfied; provided further, that the amount specified in clause (b)(i) of this definition may only be allocated once on any date of determination and the Investment Manager shall designate to the Collateral Administrator in writing on each such date the portion of such amount that shall be allocated to clause (b)(ii)(A) of this definition and the portion of such amount that shall be allocated to clause (b)(ii)(B) of this definition (it being understood that, absent an express designation by the Investment Manager, all such amounts shall be allocated to clause (b)(ii)(A) of this definition)Condition is satisfied.
“Moody’s Weighted Average Recovery Rate”: As of any date of determination,the number, expressed as a percentage, obtained by summing the product of the Moody’sRecovery Rate on such Measurement Date of each Collateral Obligation (excluding anyDefaulted Obligation) and the Principal Balance of such Collateral Obligation, dividing suchsum by the Aggregate Principal Balance of all such Collateral Obligations and rounding up tothe first decimal place.
“Moody’s Weighted Average Spread Adjustment”: As of any date of determination, the greater of (a) zero and (b) an amount equal to the product of (i) [__]% minus the weighted average spread of the Class A Notes and the Class B Notes (not taking into account any payments on the Rated Notes), and (ii) [__].
“Non-Call Period”: The period from the ClosingAmendment Date to butexcluding the Payment Date in, (i) solely in the case of the Class A-2 Notes, April 2016 and (ii) in the case of all other Rated Debt and the Subordinated Notes, October 2016. [__], 20[__].
“Non-Consenting Holder”: The meaning specified in Section 14.13(b).
“Non-Permitted ERISA Holder”: Any Person that is or becomes the beneficialowner of an interest in any Note who has made or is deemed to have made a prohibited
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transaction representation or a Benefit Plan Investor, Controlling Person or, Similar Law or other ERISA representation that is subsequently shown to be false or misleading or whose beneficialownership otherwise results in Benefit Plan Investors owning 25% or more of the AggregateOutstanding Amount of the Class E Notes, Class F Notes, Income Notes or Subordinated Notes,as applicable, being transferred determined in accordance with the Regulation and the Indenture and Security Agreement, assuming, for this purpose, that all the representations made (or, in thecase of Global Notes, deemed to be made) by holders of such Notes are true.
“Non-Permitted Holder”: The meaning specified in Section 2.12(a).
“Notes”: Collectively, the Rated Notes and the Subordinated Notes authorizedby, and authenticated and delivered under, this Indenture and Security Agreement (as specifiedin Section 2.3) or any supplemental indenture and security agreement (and including anyadditional notesNotes issued hereunder pursuant to Section 2.4).
“Note Interest Amount”: With respect to any specified Class of Rated Notes and any Payment Date, the amount of interest for the next Interest Accrual Period payable in respect of each U.S.$100,000 Outstanding principal amount of such Class of Rated Notes.
“Note Interest Rate”: With respect to any Class of Rated Notes, (a) unless a Re-Pricing has occurred with respect to such Class, the per annum interest rate payable on the Rated Notes of such Class with respect to each Interest Accrual Period specified in Section 2.3 and (b) upon the occurrence of a Re-Pricing, the applicable Re-Pricing Rate.
“NRSRO”: Any nationally recognized statistical rating organization, other thanany Rating Agency.
“NRSRO Certification”: A certification substantially in the form of Exhibit Eexecuted by a NRSRO in favor of the Issuer and the Information Agent that states that suchNRSRO has provided the Issuer with the appropriate certifications under Exchange Act Rule17g-5(a)(3)(iii)(B) and that such NRSRO has access to the 17g-5 Website.
“Obligor”: The issuer of a Bond or the obligor or guarantor under a loan, as thecase may be.
“Offer”: The meaning specified in Section 10.7(b).
“Offering”: The offering of the Notes pursuant to the Offering Circular.
“Offering Circular”: TheWith respect to any Class of Notes, the final offeringcircular with respectrelating to the Notesoffer and the Incomesale of such Notes, dated August 19, 2014, including any supplements thereto.
“Officer”: With respect to the Issuer, the Co-Issuer and any corporation orlimited liability company, any director, manager, the Chairman of the Board of Directors, thePresident, any Vice President, the Secretary, an Assistant Secretary, the Treasurer or an AssistantTreasurer of such entity or any Person authorized by such entity and shall, for the avoidance ofdoubt, include any duly appointed attorney-in-fact of the Issuer; with respect to any partnership,
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any general partner thereof or any Person authorized by such entity; with respect to a limitedliability company, any member thereof or any Person authorized by such entity; and with respectto the Trustee, any Bank Officer.
“offshore transaction”: The meaning specified in Regulation S.
“Opinion of Counsel”: A written opinion addressed to the Trustee, the Collateral Agent and, if required by the terms hereof, each Rating Agency then rating any Class of RatedDebtNotes, in form and substance reasonably satisfactory to the Trustee and the Collateral Agent (and if so addressed, each Rating Agency then rating any Class of Rated Debt), of a nationally orinternationally recognized law firm or an attorney admitted to practice (or law firm, one or moreof the partners of which are admitted to practice) before the highest court of any State of theUnited States or the District of Columbia (or the Cayman Islands, in the case of an opinionrelating to the laws of the Cayman Islands) in the relevant jurisdiction, which attorney (or lawfirm) may, except as otherwise expressly provided in this Indenture and Security Agreement, becounsel for the Issuer or the Co-Issuer, as the case may be, and which firm or attorney, as thecase may be, shall be reasonably satisfactory to the Trustee and the Collateral Agent. Wheneveran Opinion of Counsel is required hereunder, such Opinion of Counsel may rely on opinions ofother counsel who are so admitted and so satisfactory, which opinions of other counsel shallaccompany such Opinion of Counsel and shall either be addressed to the Trustee and the Collateral Agent (and, if required by the terms hereof, each Rating Agency then rating any Classof Rated DebtNotes) or shall state that the Trustee and the Collateral Agent (and, if required bythe terms hereof, each Rating Agency then rating any Class of Rated DebtNotes) shall be entitledto rely thereon.
“Optional Redemption”: A redemption of the DebtNotes in accordance withSection 9.2.
“Outstanding”: With respect to the DebtNotes of any specified Class, as of anydate of determination, all of the DebtNotes or all of the DebtNotes of such Class, as the case maybe, theretofore authenticated and delivered under this Indenture and Security Agreement or incurred pursuant to the Credit Agreement, except:
Notes theretofore canceled by the Registrar or delivered to the(i)Registrar for cancellation or registered in the Register on the date the Trusteeprovides notice to Holders pursuant to Section 4.1 that this Indenture and Security Agreement has been discharged and Class A Loans (or the portion thereof) that have been repaid pursuant to the Credit Agreement;
DebtNotes or portions thereof for whose payment or redemption(ii)funds in the necessary amount have been theretofore irrevocably deposited withthe Collateral AgentTrustee or the Income Note Paying Agent in trust for theHolders of such DebtNotes pursuant to Section 4.1(a)(i)(B); provided that if suchDebtNotes or portions thereof are to be redeemed, notice of such redemption hasbeen duly given pursuant to this Indenture and Security Agreement or provisiontherefor satisfactory to the Collateral AgentTrustee has been made;
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Notes in exchange for or in lieu of which other Notes have been(iii)authenticated and delivered pursuant to this Indenture and Security Agreement,unless proof satisfactory to the Trustee is presented that any such Notes are heldby a Protected Purchaser;
Notes alleged to have been mutilated, defaced, destroyed, lost or(iv)stolen for which replacement Notes have been issued as provided in Section 2.7;
provided that in determining whether the Holders of the requisite Aggregate OutstandingAmount have given any request, demand, authorization, direction, notice, consent or waiverhereunder or under the Investment Management Agreement, (I)(x) any DebtNotes owned by theIssuer, the Co-Issuer, or any other obligor upon the DebtNotes (other than the Income NoteIssuer) or any Affiliate thereof (but excluding the Income Note Issuer) or (y) only in the case of avote on (i) the removal of the Investment Manager for “cause” or upon the occurrence of theevents specified in Section 11(c) of the Investment Management Agreement and (ii) the waiverof any event specified in Section 11(c) of the Investment Management Agreement constituting“cause”, any DebtNotes owned by the Investment Manager, any Affiliate of the InvestmentManager or any account or investment fund over which the Investment Manager or any Affiliatehas discretionary voting authority, in connection with any vote under Section 11(c) of theInvestment Management Agreement shall each be disregarded and deemed not to beOutstanding, except that, in determining whether the Trustee and/or the Collateral Agent shall beprotected in relying upon any such request, demand, authorization, direction, notice, consent orwaiver, only DebtNotes a Bank Officer of the Trustee or the Collateral AgentTrustee has actualknowledge (or has been provided written notice of) to be so owned shall be so disregarded and(II) DebtNotes so owned that has been pledged in good faith may be regarded as Outstanding ifthe pledgee establishes to the satisfaction of the Trustee or the Collateral AgentTrustee thepledgee’s right so to act with respect to such DebtNotes and that the pledgee is not the Issuer, theCo-Issuer, any other obligor upon the DebtNotes or any Affiliate of the Issuer, the Co-Issuer, orsuch other obligor (or the Investment Manager, any Affiliate of the Investment Manager or anyaccount or investment fund over which the Investment Manager or any Affiliate hasdiscretionary voting authority).
“Par Value Ratio”: With respect to any specified Class or Classes of RatedDebtNotes as of the last day of the Ramp-Up Period or any Measurement Date thereafter, thepercentage derived from dividing: (a) the Adjusted Collateral Principal Amount by (b) the sumof (i) the Aggregate Outstanding Amounts of the Rated DebtNotes of such Class or Classes andeach Priority Class of Rated DebtNotes, plus (ii) Deferred Interest with respect to such Class orClasses and each Priority Class of Rated DebtNotes (excluding, for this purpose, the Aggregate Outstanding Amount of the Class X Notes).
“Par Value Ratio Test”: A test that is satisfied with respect to any Class orClasses of Rated DebtNotes (other than the Class X Notes or the Class F Notes) as of any date ofdetermination at, or subsequent to, the last day of the Ramp-Up Period, if (i) the Par Value Ratiofor such Class or Classes is at least equal to the applicable Required Coverage Ratio for suchClass or Classes or (ii) such Class or Classes of Rated Debt isNotes are no longer Outstanding.
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“Partial Redemption by Refinancing”: The meaning specified in Section 9.3.
“Partial Redemption Date”: The date on which a Partial Redemption by Refinancing occurs.
“Partial Redemption Interest Proceeds”: In connection with a Partial Redemption by Refinancing, Interest Proceeds in an amount equal to the sum of (i) the lesser of (a) the amount of accrued interest on the Classes being refinanced (after giving effect to payments under Section 11.1(a)(i) if the Partial Redemption Date would have been a Payment Date without regard to the Partial Redemption by Refinancing) and (b) the amount the Investment Manager reasonably determines would have been available for distribution under the Priority of Payments for the payment of accrued interest on the Classes being refinanced on the next subsequent Payment Date (or, if the Partial Redemption Date is otherwise a Payment Date, such Payment Date) if such Notes had not been refinanced plus (ii) if the Partial Redemption Date is not otherwise a Payment Date, an amount equal to (a) the amount the Investment Manager reasonably determines would have been available for distribution under the Priority of Payments for the payment of Administrative Expenses with respect to such Partial Redemption by Refinancing on the next subsequent Payment Date plus (b) the amount of any reserve established by the Issuer with respect to such Partial Redemption by Refinancing.
“Partial Redemption Priority of Payments”: The meaning specified in Section 11.1(a)(iii).
“Participation Interest”: A participation interest in a loan that at the time ofacquisition or the Issuer’s commitment to acquire the same, satisfies each of the followingcriteria:
such participation would constitute a Collateral Obligation were it(a)acquired directly,
the selling institution is the lender on the loan,(b)
the aggregate participation in the loan does not exceed the principal(c)amount or commitment of such loan,
such participation does not grant, in the aggregate, to the participant in(d)such participation a greater interest than the selling institution holds in the loan orcommitment that is the subject of the participation,
the entire purchase price for such participation is paid in full at the time of(e)its acquisition (or, in the case of a participation in a Revolving Collateral Obligation orDelayed Drawdown Collateral Obligation, at the time of the funding of such loan),
the participation provides the participant all of the economic benefit and(f)risk of the whole or part of the loan or commitment that is the subject of the loanparticipation, and
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such participation is documented under a Loan Syndications and Trading(g)Association, Loan Market Association or similar agreement standard for loanparticipation transactions among institutional market participants;
provided, that, for the avoidance of doubt, a Participation Interest shall not include asub-participation interest in any loan.
“Partnership Tax Audit Rules”: Section 6221 through 6241 of the Code, as amended by the Bipartisan Budget Act of 2015, together with any regulations and guidance issued thereunder (or any successor provisions) and any similar provisions of state and local tax laws.
“Partners”: The meaning specified in Section 7.16(c).
“Paying Agent”: Any Person authorized by the Issuer to pay the principal of orinterest on any Notes or Class A Loans on behalf of the Issuer as specified in Section 7.2.
“Payment Account”: The payment account of the Trustee established pursuant toSection 10.3(a).
“Payment Date”: The 15th day of January, April, July and October of each year(or if such day is not a Business Day, then the next succeeding Business Day), commencing inJanuary 2015; provided that following the redemption or repayment in full of the RatedDebtNotes, Holders of Subordinated Notes may receive payments (including in respect of anOptional Redemption of the Subordinated Notes) on any dates designated by the InvestmentManager or, with the consent of the Investment Manager, the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder Condition is satisfied) (which dates may or may not be the dates stated above) upon five (5) Business Days’ priorwritten notice to the Collateral AgentTrustee and the Collateral Administrator (which notice theCollateral AgentTrustee shall promptly forward to the Holders of the Subordinated Notes and the Income Note Paying Agent will promptly forward to the Holders of the Income Notes) and suchdates shall thereafter constitute “Payment Dates”; provided, further, that each Redemption Dateshall be deemed to be(other than a Partial Redemption Date) shall constitute a Payment Datehereunder, as set forth in the definition of “Redemption Date.”.
“PBGC”: The United States Pension Benefit Guaranty Corporation.
“Permitted Deferrable Obligation”: Any Deferrable Obligation the Underlying Instrument of which carries a current cash pay interest rate of not less than (a) in the case of a floating rate Collateral Obligation, LIBOR plus 1.00% per annum or (b) in the case of a fixed rate Collateral Obligation, the zero-coupon swap rate in a fixed/floating interest rate swap with a term equal to five years.
“Permitted Use”: With respect to (a) the proceeds of an additional issuance of additional Subordinated Notes and/or Junior Mezzanine Notes as designated for a Permitted Use, (b) any Contribution received into the Permitted Use Account, (c) as determined by the Investment Manager, any amounts in respect of any Redirected Fee Interest designated in
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accordance with the Investment Management Agreement: (i) the transfer of the applicable portion of such amount to the Interest Collection Subaccount for application as Interest Proceeds; (ii) the transfer of the applicable portion of such amount to the Principal Collection Subaccount for application as Principal Proceeds; (iii) the repurchase of Rated Notes of any Class in accordance with Section 2.16; (iv) the payment of expenses incurred in connection with a Refinancing, additional issuance of Notes or a Re Pricing, in each case as determined by the Investment Manager and subject to the limitations set forth in this Indenture; (v) the payment of any taxes, registered office or governmental fees owing by any Issuer Subsidiary; and (vi) to make payments in connection with the exercise of an option, warrant, right of conversion, pre-emptive right, rights offering, credit bid or similar right received in connection with the workout or restructuring of a Collateral Obligation (so long as, unless the Permitted Securities Condition is satisfied, the asset received in connection with such payment would be considered “received in lieu of debts previously contracted for” with respect to the Collateral Obligation under the Volcker Rule), in each case subject to the limitations set forth in this Indenture.
“Permitted Use Account”: The account established pursuant to Section 10.3(g).
“Permitted Securities Condition”: As of any date of determination, a condition that is satisfied if (A) the Volcker Rule is repealed or (B) the Issuer and the Investment Manager have received advice from nationally recognized counsel to the effect that either (x) assuming that the Issuer were a “covered fund” under the Volcker Rule, no Class of Rated Notes constitutes “ownership interests” in the Issuer under the Volcker Rule or (y) the Issuer is not a “covered fund” under the Volcker Rule.
“Person”: An individual, corporation (including a business trust), partnership,limited liability company, joint venture, association, joint stock company, trust (including anybeneficiary thereof), unincorporated association or government or any agency or politicalsubdivision thereof.
“Placement Agency Agreement”: TheWith respect to the Notes issued on the Closing Date, the agreement dated as of August 21, 2014 by and between the Co-Issuers, theIncome Note Issuer and the Placement Agent relating to the placement of thesuch Notes, as amended from time to time; and with respect to the Notes issued on the Amendment Date, the agreement dated as of [__], 20[__] by and between the Co-Issuers, the Income Note Issuer and the Placement Agent relating to the placement of such Notes, as amended from time to time.
“Placement Agent”: GreensLedge Capital Markets LLC, in its capacity asplacement agent the Placement Agency Agreement.
“Pledged Obligations”: As of any date of determination, the CollateralObligations, the Eligible Investments and any Equity Security which forms part of the Assetsthat have been Granted to the Collateral AgentTrustee.
“Portfolio Quality TestTests”: A test satisfied if, as of any date on which a determination is required hereunder at, or subsequent to, the end of the Ramp-Up Period, in the aggregate, the Collateral Obligations owned (or in relation to a proposed purchase of a Collateral Obligation, proposed to be owned) by the Issuer satisfy each of the tests set forth below (or,
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unless otherwise explicitly provided for in Section 12.2(a), if any such test is not satisfied, the results of such test are maintained or improved)Each of the following tests, calculated in eachcase as required by Section 1.2:
the Minimum Fixed Coupon Test;(i)
the Minimum Floating Spread Test;(ii)
the Maximum Moody’s Rating Factor Test;(iii)
the Moody’s Diversity Test;(iv)
the Moody’s Minimum Weighted Average Recovery Rate Test;(v)and
the Weighted Average Life Test.(vi)
“Post-Acceleration Payment Date”: Any Payment Date after the principal of theRated Debt hasNotes have been declared to be or has otherwise become immediately due andpayable pursuant to Section 5.2; provided that such declaration has not been rescinded orannulled.
“Principal Balance”: Subject to Section 1.2, with respect to (a) any PledgedObligation (other than a Revolving Collateral Obligation or Delayed Drawdown CollateralObligation) as of any date of determination, the outstanding principal amount of such PledgedObligation and (b) any Revolving Collateral Obligation or Delayed Drawdown CollateralObligation, as of any date of determination, the outstanding principal amount of such RevolvingCollateral Obligation or Delayed Drawdown Collateral Obligation, plus (except as expressly setforth in this Indenture and Security Agreement) any undrawn commitments that have not beenirrevocably reduced with respect to such Revolving Collateral Obligation or Delayed DrawdownCollateral Obligation; provided that for all purposes (i) the Principal Balance of any EquitySecurity or Collateral Obligation that has been a Defaulted Obligation for three years or moreshall be deemed to be zero, (ii) the Principal Balance of any Collateral Obligation that, at thetime of its purchase by the Issuer, was subject to an Offer for a price of less than its par amount,shall be, until the expiration of such Offer in accordance with its terms, the Offer price(expressed as a dollar amount) of such Collateral Obligation, (iii) the Principal Balance of aDeferrable Obligation (x) shall not include any deferred interest that has been added to principalsince its acquisition and remains unpaid and (y) shall only include interest that has been deferredor capitalized at the time of acquisition if (1) in the Investment Manager’s commerciallyreasonable business judgment, such interest remains unpaid for any reason other than due to therelated Obligor’s ability to repay such amounts and (2) such Deferrable Obligation has aMoody’s Default Probability Rating of “B3” or better (and, for the avoidance of doubt, suchinterest shall constitute Principal Proceeds upon receipt thereof by the Issuer), (iv) the PrincipalBalance of a Deferring Obligation shall not include any deferred or capitalized interest referredto in clause (iii)(y) above and (v) the Principal Balance of a Zero-Coupon Security which, by itsterms, does not at any time pay cash interest thereon shall be deemed to be the accreted value of
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such Collateral Obligation (other than a Defaulted Obligation) or Eligible Investment as of thedate of determination.
“Principal Collection Subaccount”: The meaning specified in Section 10.2(a).
“Principal Financed Accrued Interest”: With respect to: (i) any CollateralObligation owned or purchased by the Issuer on the Closing Date, an amount equal to the unpaidinterest on such Collateral Obligation that accrued prior to the Closing Date that is owing to theIssuer and remains unpaid as of the Closing Date and (ii) any Collateral Obligation purchasedafter the Closing Date, the amount of Principal Proceeds, if any, applied towards the purchase ofaccrued interest on such Collateral Obligation; provided that in the case of this clause (ii),Principal Financed Accrued Interest shall not include any accrued interest purchased withInterest Proceeds deemed to be Principal Proceeds as set forth in the definition of “InterestProceeds”; provided, further, that once any Principal Financed Accrued Interest is actuallyreceived by the Issuer, it shall no longer constitute Principal Financed Accrued Interesthereunder.
“Principal Proceeds”: With respect to any Collection Period or DeterminationDate, all amounts received by the Issuer during the related Collection Period that do notconstitute Interest Proceeds and any other amounts that have been designated as PrincipalProceeds pursuant to the terms of this Indenture and Security Agreement; provided that for theavoidance of doubt, under no circumstances shall Principal Proceeds include the ExceptedProperty.
“Priority Class”: With respect to any specified Class of DebtNotes, each Class ofDebtNotes that ranks senior to such Class, as indicated in Section 2.3.
“Priority Hedge Termination Event”: The occurrence (a) of any terminationunder a Hedge Agreement with respect to which the Issuer is the sole Defaulting Party orAffected Party (each as defined in the relevant Hedge Agreement), (b) with respect to the Issuer,of any event described in Section 5(b)(i) (“Illegality”) of any Hedge Agreement, or (c) theliquidation of Assets due to an Event of Default under this Indenture and Security Agreement.
“Priority of Payments”: The meaning specified in Section 11.1(a).
“Proceeding”: Any suit in equity, action at law or other judicial or non-judicialenforcement or administrative proceeding.
“Protected Purchaser”: The meaning specified in Section 8-303 of the UCC.
“Purposely Deferring Obligation”: A Deferrable Obligation that is designated assuch by the Investment Manager (and notified to the Collateral Administrator as such) on orprior to the date of its acquisition that is currently deferring a portion of the payment of accrued,unpaid interest (other than, for the avoidance of doubt, a Deferrable Obligation where in thereasonable judgment of the Investment Manager, such deferral of interest is inconsistent with theexpected payment schedule for interest on such Deferrable Obligation); provided, that aDeferrable Obligation shall not be designated as a Purposely Deferring Obligation if the deferredand/or capitalized interest that is required to be repaid by the obligor under the terms of the
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related Underlying Instrument would cause such Deferrable Obligation to have a current cashpay rate of interest less than (a) if such Deferrable Obligation is a fixed-rate obligation, 4.00%per annum, or (b) if such Deferrable Obligation is a floating-rate obligation, 2.00% per annumabove the related LIBOR for such Deferrable Obligation.
“QIB/QP”: Any Person that, at the time of its acquisition, purported acquisitionor proposed acquisition of Notes is both a Qualified Institutional Buyer and a QualifiedPurchaser.
“Qualified Broker/Dealer”: Any of Bank of America, NA, The Bank of Montreal, The Bank of New York Mellon, The Royal Bank of Scotland plc, Barclays Bank plc, BNP Paribas, Broadpoint Securities Inc., Calyon, Canadian Imperial Bank of Commerce, Cantor Fitzgerald, Citadel Securities, Citibank, N.A., Credit Agricole S.A., Credit Suisse, Deutsche Bank AG, FBR Capital Markets, Gleacher & Company Securities, Inc., Goldman, Sachs & Co., HSBC Bank, JPMorgan Chase Bank, N.A., Knight/Libertas, Lazard Ltd., Macquarie Bank, Mizuho Bank, Ltd., Morgan Stanley & Co., Natixis, Nomura Securities Inc., Northern Trust Company, Oppenheimer & Co. Inc., Royal Bank of Canada, Scotia Bank, Societe Generale, Sun Trust Bank, The Toronto-Dominion Bank, U.S. Bank, National Association, UBS AG or Wells Fargo Bank, National Association, or a banking or securities affiliate of any of the foregoing, and any other financial institution so designated by the Investment Manager with notice to the Rating Agencies.
“Qualified Institutional Buyer”: The meaning specified in Rule 144A under theSecurities Act.
“Qualified Purchaser”: The meaning specified in Section 2(a)(51) of theInvestment Company Act and Rule 2a51-2 under the Investment Company Act.
“Ramp-Up Account”: The account established pursuant to Section 10.3(c).
“Ramp-Up Period”: The period commencing on the Closing Date and endingupon the earlier of (a) 30th day prior to the Determination Date relating to the second PaymentDate and (b) any date selected by the Investment Manager in its sole discretion on or after whichthe Aggregate Ramp-Up Par Condition has been satisfied.
“Rated Debt”: The Rated Notes and the Class A Loans.
“Rated Notes”: The Class A-1X Notes, the Class A-2 Notes, the Class B-1 Notes, the Class B-2 Notes, the Class C-1 Notes, the Class C-2 Notes, the Class D Notes, the Class ENotes and the Class F Notes.
“Rating”: The Moody’s Rating and/or Fitch Rating, as applicable.
“Rating Agency”: Each of Moody’s and Fitch, in each case only for so long asDebtNotes rated by such entity on the ClosingAmendment Date isare Outstanding and rated bysuch entity.“Rating Agency Surveillance Weighted Average Floating Spread”: The calculation of “Weighted Average Floating Spread” whereby clause (i)(B) of such definition is deemed to be zero. If a Rating Agency withdraws all of such ratings on the Rated Notes or such Rated Notes
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rated by such Rating Agency are paid in full, it shall no longer constitute a Rating Agency for purposes of this Indenture, and any provisions of this Indenture that refer to such Rating Agency and any tests or limitations that incorporate the name of such Rating Agency shall have no further effect.
“Re-Priced Class”: The meaning specified in Section 9.9(a).“Re-Priced Notes”: The meaning specified in Section 9.9(c).
“Re-Pricing”: The meaning specified in Section 9.9(a).
“Re-Pricing Date”: The meaning specified in Section 9.9(b).
“Re-Pricing Intermediary”: The meaning specified in Section 9.9(a).
“Re-Pricing Rate”: The meaning specified in Section 9.9(b).
“Record Date”: As to any applicable Payment Date, the 15th day (whether or nota Business Day) prior to such Payment Date.
“Redemption/Re-Pricing Objection Condition”: A condition that shall be satisfied as of any date of determination so long as the Initial Majority Subordinated Noteholder and its Affiliates have certified that such Persons have owned, from the Closing Date to such date of determination, at least a Majority of the Subordinated Notes.Recovery Rate Modifier Matrix”: The following chart used to determine which of the “row/column combinations” (or the linear interpolation between two adjacent rows and/or two adjacent columns) are applicable for purposes of the definition of “Moody’s Weighted Average Recovery Adjustment”:
[TABLE TO COME]
“Redemption Date”: Any date specified for an Optional Redemption, aredemption of Debtfollowing a Tax Event of Clean-Up Call Redemption of Notes pursuant toArticle IX; provided that, each, including any Partial Redemption Date shall be deemed to be a Payment Date hereunder..
“Redemption by Liquidation”: The meaning specified in Section 9.2(a).
“Redemption by Refinancing”: The meaning specified in Section 9.2(a).
“Redemption Price”: When used with respect to (i) any Class of Rated DebtNotes(a) an amount equal to 100% (or such lesser amount as agreed in writing by the applicableHolder) of the Aggregate Outstanding Amount thereof plus (b) accrued and unpaid interestthereon (including Deferred Interest and interest on any accrued and unpaid Deferred Interestwith respect to such Rated DebtNotes), to the Redemption Date or Re-Pricing Date, and (ii) anySubordinated Note, its proportional share (based on the Aggregate Outstanding Amount of suchSubordinated Notes) of the amount of the proceeds of the Assets (including proceeds createdwhen the lien of this Indenture and Security Agreement is released) remaining after giving effectto the redemption of the Rated DebtNotes in full and payment in full of (and/or creation of areserve for) all expenses of the Co-Issuers; provided that solely with respect to a redemption
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following a Tax Event, an Optional Redemption in whole or a Redemption by Refinancing of all Classes of Rated Debt, any Holder of a Rated DebtNote may in its sole discretion elect, bywritten notice to the Issuer, the Trustee, the Collateral Agent, the Paying Agent, the Income NotePaying Agent and the Investment Manager, to receive in full payment for the redemption of itsRated DebtNote an amount equal to less than 100% of the outstanding principal amount of suchRated DebtNote plus accrued and unpaid interest thereon, which lesser amount shall be deemedto be the “Redemption Price” of such Rated DebtNote.
“Redirected Fee Interest”: The meaning specified in Section 11.1(g).
“Reference Banks”: The meaning specified in the definition of “LIBOR.”
“Refinancing”: The meaning specified in Section 9.2(a).
“Refinancing Proceeds”: With respect to any Refinancing, the Cash proceedsreceived by the Issuer therefrom.
“Refinancing Redemption Date”: The Redemption Date for a Redemption by Refinancing or a Partial Redemption by Refinancing.
“Register” and “Registrar”: The respective meanings specified in Section 2.6(a).
“Registered Office Agreement”: An agreement between the Administrator andthe Issuer for the provision of registered office facilities to the Issuer, as such agreement may beamended, supplemented or varied from time to time.
“Regulation D”: Regulation D, as amended, under the Securities Act.
“Regulation S”: Regulation S, as amended, under the Securities Act.
“Regulation S Global Notes”: Collectively, the Regulation S Global Rated Notesand the Regulation S Global Subordinated Notes.
“Regulation S Global Rated Note”: The meaning specified in Section 2.2(b)(i).
“Regulation S Global Subordinated Note”: The meaning specified in Section 2.2(b)(i).
“Reinvestment Diversion Test”: A test that shall be satisfied as of anyMeasurement Date during the Reinvestment Period (but on or after the last day of the Ramp-UpPeriod), if the Par Value Ratio with respect to the most junior Class of Rated DebtNotes thatremain Outstanding as of such Measurement Date is at least equal to 102.4[__]%.
“Reinvestment Period”: The period from and including the Closing Date to andincluding the earliest of (i) the Payment Date in October 2018,[___] 20[__], (ii) the date of theacceleration of the Maturity of any Class of Rated DebtNotes pursuant to Section 5.2, and (iii) the date on which the Investment Manager reasonably determines and notifies the Issuer(iii) the end of the Collection Period related to a Redemption Date in connection with a Redemption by
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Liquidation or a redemption following a Tax Event, and (iv) the date specified by the Investment Manager in a written notice delivered at least five (5) Business Days prior to such date to the Co-Issuers, the Rating Agencies, the Collateral Agent, the Loan Agent, the Trustee (which shall notify the Holders) and the Collateral Administrator upon the Investment Manager’s reasonable determination that it is unable to identify additional Collateral Obligations for reinvestment for aperiod of at least thirty (30) consecutive Business Days in accordance with Section 12.2 or theInvestment Management Agreement; provided, that in the case of this clause (iii), the Investment Manager notifies the Issuer, the Trustee (who that (x) upon termination pursuant to clause (ii) above, the Reinvestment Period shall be reinstated upon rescission of such acceleration and with notice to the Rating Agencies so long as no other events that would terminate the Reinvestment Period have occurred and are continuing and (y) upon termination pursuant to clause (iv) above, the Reinvestment Period may be reinstated upon written direction of the Investment Manager to the Co-Issuers, the Rating Agencies, the Trustee (which shall notify the Holders), the Collateral Agent, the Loan Agent and the Collateral Administrator thereof at least five Business Days prior to such dateso long as no other events that would terminate the Reinvestment Period have occurred and are continuing.
“Reinvestment Target Par Balance”: The Aggregate Ramp-Up Par Amountminus (A) any reduction in the Aggregate Outstanding Amount of the DebtNotes through thepayment of Principal Proceeds or Interest Proceeds plus (B) the aggregate amount of PrincipalProceeds that result from the issuance of any Additional DebtNotes (after giving effect to suchissuance of any Additional DebtNotes but excluding (i) the amount of additional Subordinated Notes or Junior Mezzanine Notes issued in excess of the pro rata issuance amount, if any, of such Subordinated Notes or Junior Mezzanine Notes required in connection with any related additional issuance of Rated Notes and (ii) any additional Subordinated Notes or Junior Mezzanine Notes issued without any Rated Notes).
“Related Obligation”: An obligation issued by, or a loan originated by, the Investment Manager, any of its Affiliates that are collateralized debt obligation funds or accounts or any other person that is a collateralized debt obligation fund or account whose investments are primarily managed by the Investment Manager or any of its Affiliates.Term Loan”: The meaning specified in the definition of “Discount Obligation” in this Section 1.1.
“Requesting Party”: The meaning specified in Section 14.16.
“Required Coverage Ratio”: With respect to a specified Class of RatedDebtNotes and the related Interest Coverage Test or Par Value Ratio Test as the case may be, asof any date of determination, the applicable percentage indicated below opposite such specifiedClass:
Class Required Par Value RatioA/B 124.1[__]%C 113.9[__]%D 108.6[__]%E 103.4[__]%
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ClassRequired Interest Coverage
RatioA/B 115.0%C 110.0%D 105.0%
“Required Hedge Counterparty Rating”: With respect to any HedgeCounterparty, (x) a short-term rating of “P-1” and a long-term senior unsecured debt orcounterparty rating of “A2” or above by Moody’s which is not then on credit watch for possibledowngrade by Moody’s or, if it does not have a short-term rating by Moody’s, then a long-termsenior unsecured debt or counterparty rating of “A1” or above by Moody’s and in each case suchrequired rating is not on credit watch for possible downgrade by Moody’s and (y) a short-termissuer default rating by Fitch of not less than “F1” and a long-term issuer default rating of “A”,except, in each case, to the extent that Moody’s or Fitch, as applicable, provides writtenconfirmation that one or more of such ratings from Moody’s or Fitch, as applicable, is notrequired to be satisfied.
“Reset Amendment”: The meaning specified in Section 9.5.
“Restricted Trading Period”: Each day during which (a)(i) if the Class A Obligations are still Outstanding, the Fitch rating of the Class A Obligations or other than in connection with the payment in full of the applicable Class, the Moody’s rating of the Class AObligations or Class B Notes areis one or more subcategories below its initial ratingInitial Target Rating thereof or withdrawn, (ii) the Moody’s rating of any of the Class C Notes or Class D Notes is two or more subcategories below its initial ratings thereof or withdrawn or (iii) the Moody’s rating of the Class E Notes is three or more subcategories below its initial ratings and(b) after giving effect to any sale of the Collateral Obligation, the Aggregate Principal Balance of therelevant Collateral Obligations (solely for the purposes of this clause (b), the Aggregate Principal Balance of any Defaulted Obligation will be deemed to be equal to the Market Value of such Defaulted Obligation) and the Eligible Investments constituting Principal Proceeds will be less than the Reinvestment Target Par Balance, any of the Par Value Ratio Tests not be satisfied;provided, that such period will not be a Restricted Trading Period upon the direction of aMajority of the Controlling Class, which direction by the Majority of the Controlling Class willremain in effect until the earlier of (A) a subsequent direction by a Majority of the ControllingClass to declare the beginning of a Restricted Trading Period or (B) a further downgrade orwithdrawal of any Class of DebtNotes that notwithstanding such direction would cause theconditions set forth above to be true. No Restricted Trading Period shall restrict any sale of aCollateral Obligation entered into by the Issuer at the time when a Restricted Trading Period isnot in effect, regardless of whether such sale has settled.
“Retention Interest”: An “eligible vertical interest” in the Notes equal to at least 5% of the outstanding amount of each Class of Notes on the Amendment Date which interest shall be acquired and held by a “majority-owned affiliate” (as defined in the U.S. Risk Retention Rules) of the Investment Manager.
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“Reuters Screen”: The rates for deposits in dollars which appear on the ReutersScreen LIBOR 01 Page (or such other page that may replace that page on such service for thepurpose of displaying comparable rates) on the Bloomberg Financial Markets CommoditiesNews (or its successor) as of 11:00 a.m., London time, on the Interest Determination Date.
“Revolving Collateral Obligation”: Any Asset (other than a Delayed DrawdownCollateral Obligation) that is a loan (including, without limitation, revolving loans, includingfunded and unfunded portions of revolving credit lines and letter of credit facilities, unfundedcommitments under specific facilities and other similar loans and investments) that by its termsmay require one or more future advances to be made to the borrower by the Issuer; provided thatany such Collateral Obligation shall be a Revolving Collateral Obligation only until allcommitments to make advances to the borrower expire or are terminated or irrevocably reducedto zero.
“Risk Retention Issuance”: An additional issuance of any Class of Notes for purposes of enabling the Investment Manager to comply with the U.S. Risk Retention Rules in the same form in effect as of the Amendment Date (or otherwise with the consent of a Majority of the Subordinated Notes) as determined by the Investment Manager in its commercially reasonable judgment based upon the advice of nationally recognized counsel experienced in such matters (a summary of such advice to be provided to the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder Condition is satisfied) prior to such issuance).
“Rule 144A”: Rule 144A, as amended, under the Securities Act.
“Rule 144A Global Notes”: Collectively, the Rule 144A Global Rated Notes andthe Rule 144A Global Subordinated Notes.
“Rule 144A Global Rated Note”: The meaning specified in Section 2.2(b)(ii).
“Rule 144A Global Subordinated Note”: The meaning specified in Section 2.2(b)(ii).
“Rule 144A Information”: The meaning specified in Section 7.14.
“Rule 17g-5”: The meaning specified in Section 14.15.
“S&P”: Standard & Poor’s Ratings Services, a Standard & Poor’s FinancialServices LLC business, and any successor or successors thereto.
“S&P Industry Classifications”: The meaning specified in Schedule 2 to thisIndenture and Security Agreement.
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“S&P Rating”: The S&P Rating of any Collateral Obligation, as of any date ofdetermination, will be determined as follows:
(i) With respect to any Collateral Obligation other than a DIP Collateral(a)Obligation or a Current Pay Obligation,
(A) if there is an issuer credit rating of the issuer of such Collateral(i)Obligation, or the guarantor who unconditionally and irrevocably guarantees suchCollateral Obligation, then such credit rating of such issuer, or the guarantor ofsuch issuer, by S&P as published by S&P shall be such rating (regardless ofwhether there is a published rating by S&P on the Collateral Obligation of suchissuer held by the Issuer; provided, that private ratings (that is, ratings provided atthe request of the obligor) may be used for purposes of this definition if therelated obligor has consented to the disclosure thereof and a copy of such consenthas been provided to S&P);
(B) if clause (Ai) is not applicable and such Collateral Obligation(ii)is rated by S&P or S&P has provided a credit estimate, then the S&P Rating ofsuch Collateral Obligation shall be the rating assigned thereto by S&P; and
(C) if clauses (Ai) and (Bii) are not applicable and such Collateral (iii)Obligation has a Moody’s rating, then the S&P Rating of such CollateralObligation shall be the S&P equivalent of the rating assigned by Moody’s Rating; and
if clauses (i), (ii) and (iii) are not applicable, the S&P Rating of (iv)such Collateral Obligation shall be “CCC”; and
(ii) With respect to any Collateral Obligation that is a DIP Collateral(b)Obligation or a Current Pay Obligation,
(A) if such Collateral Obligation is rated by S&P, the S&P Rating(i)of such Collateral Obligation shall be the rating assigned there by S&P;
(B) if clause (Ai) is not applicable and the Issuer has obtained a(ii)private rating or credit estimate from S&P, then the S&P Rating of suchCollateral Obligation shall be such private rating or credit estimate;
(C) if clauses (Ai) and (Bii) are not applicable and such Collateral (iii)Obligation has a Moody’s rating, then the S&P Rating of such CollateralObligation shall be the S&P equivalent of the rating assigned by Moody’s Rating.
if clauses (i), (ii) and (iii) are not applicable, the S&P Rating of (iv)such Collateral Obligation shall be “CCC”.
“Sale”: The meaning specified in Section 5.17.
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“Sale Proceeds”: All proceeds (excluding accrued interest, if any) received withrespect to Assets as a result of sales of such Assets less any reasonable expenses incurred by theInvestment Manager, the Collateral Administrator, the Collateral Agent or the Trustee (otherthan amounts payable as Administrative Expenses) in connection with such sales.
“Scheduled Distribution”: With respect to any Pledged Obligation, for each DueDate, the scheduled payment of principal and/or interest due on such Due Date with respect tosuch Pledged Obligation, determined in accordance with the assumptions specified in Section 1.2.
“Second Lien Loan”: Any assignment of or Participation Interest in or otherinterest in a loan that (i) is not (and that by its terms is not permitted to become) subordinate inright of payment to any other obligation of the obligor of the loan other than a Senior SecuredLoan with respect to the liquidation of such obligor or the collateral for such loan and (ii) issecured by a valid second priority perfected security interest or lien to or on specified collateralsecuring the obligor’s obligations under the loan, which security interest or lien is notsubordinate to the security interest or lien securing any other debt for borrowed money otherthan a Senior Secured Loan on such specified collateral.
“Secured Parties”: The meaning specified in the Granting Clause.
“Securities Account Control Agreement”: An agreement dated as of the ClosingDate among the Issuer, the Collateral AgentTrustee and the Bank, as securities intermediary, asamended from time to time.
“Section 13 Banking Entity”: An entity that (i) is defined as a “banking entity” under Section 13 of the Bank Holding Company Act of 1956, as amended, 12 USC § 1851(h)(1), (ii) provides written certification to the Issuer and the Collateral Agent in the form set forth in Exhibit F hereto that it meets the definition under the foregoing clause (i), and (iii) identifies the Class or Classes of Debt held by such entity and the outstanding principal amount thereof. If no entity provides a certification described in the foregoing clause (ii), then no Section 13 Banking Entities will be deemed to exist for purposes of any required consent or action under the Transaction Documents. Further, in connection with each consent or action under the Transaction Documents that requires the consent or action by the Section 13 Banking Entities, the Collateral Agent will request that each Section 13 Banking Entity reconfirm its status as a Section 13 Banking Entity and the outstanding principal amount of Debt held by such entity; provided that no entity shall lose its status as a Section 13 Banking Entity unless the Collateral Agent receives a response to such request indicating, or is otherwise notified by such entity, that it is either no longer a Section 13 Banking Entity or no longer holds any Debt..
“Securities Act”: The United States Securities Act of 1933, as amended fromtime to time.
“Securities Intermediary”: The meaning specified in Section 8-102(a)(14) of theUCC.
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“Security Entitlement”: The meaning specified in Section 8-102(a)(17) of theUCC.
“Selling Institution”: The entity obligated to make payments to the Issuer underthe terms of a Participation Interest.
“Senior Management Fee”: The fee payable to the Investment Manager in arrearson each Payment Date (prorated for the related Interest Accrual Period), including anyRedemption Date, pursuant to Section 8 of the Investment Management Agreement and Section 11.1, in an amount equal to 0.20% per annum (calculated on the basis of a 360-day year and theactual number of days elapsed) of the Maximum Investment Amount at the beginning of theCollection Period relating to such Payment Date.
“Senior Management Fee Interest”: Interest on any accrued and unpaid SeniorManagement Fee (other than any waived Senior Management Fee or Deferred SeniorManagement Fee), which shall accrue at the rate of three-month LIBOR plus 0.20% for theperiod from (and including) the date on which such Senior Management Fee shall be payablethrough (but excluding) the date of payment thereof (calculated on the basis of a 360-day yearand the actual number of days elapsed).
“Senior Secured Bond”: A debt security (that is not a loan) that is (a) issued by acorporation, limited liability company, partnership or trust and (b) secured by a valid firstpriority perfected security interest on specified collateral.
“Senior Secured Loan”: Any assignment of, Participation Interest in or otherinterest in a loan that (A)(i) is secured by a first priority perfected security interest or lien onspecified collateral (subject to customary exemptions for permitted liens, including, withoutlimitation, any tax liens), (ii) has the most senior pre-petition priority (including pari passu withother obligations of the obligor) in any bankruptcy, reorganization, arrangement, insolvency,moratorium or liquidation proceedings, (iii) the value of the collateral securing the loan at thetime of its purchase by the Issuer together with the attributes of the Obligor (including, withoutlimitation, its general financial condition, ability to generate cash flow available for debt serviceand other demands for such cash flow) is adequate (in the commercially reasonable judgment ofthe Investment Manager) to repay or refinance the loan in accordance with the terms of itsUnderlying Instruments and to repay all other loans of equal seniority secured by a first priorityperfected security interest or lien on the same collateral and (iv) by its terms is not permitted tobecome subordinate in right of payment to any other obligation of the obligor thereof (other thanwith respect to liquidations, trade claims, capitalized leases or similar obligations) and (B) is a first First-Lien Laast-Out Loan.
“Senior Secured Note”: Any assignment of or Participation Interest in or otherinterest in a senior secured note (including, without limitation, a Moody’s Senior Secured Floating Rate Note) issued pursuant to an indenture or equivalent document by a corporation,partnership, limited liability company, trust or other person that is secured by a first or secondpriority perfected security interest or lien in or on specified collateral securing the issuer’sobligations under such note.
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“Senior Unsecured Loan”: Any assignment of or Participation Interest in or otherinterest in an Unsecured Loan that is not subordinated to any other unsecured indebtedness of theobligor.
“Sequential DebtNote Redemption”: The application, in accordance with thePriority of Payments, of Interest Proceeds or Principal Proceeds, as applicable, in the followingorder:
to the payment of principal of (including any defaulted interest) the(i)Class A Loans, the Class A-1X Notes and the Class A-2 Notes, pro rata, based ontheir respective Aggregate Outstanding Amounts, until such amounts have beenpaid in full (or, with respect to any Class A ObligationX Note or Class A Note, as applicable, has been paid in such lesser amount as the Holder of such Class A Obligation elects to receiveX Note or Class A Note, as applicable, elects (in its sole discretion by written notice to the Issuer, the Trustee, the Paying Agent and the Investment Manager) to receive, in which case, the Aggregate Outstanding Amount of such Note shall be automatically reduced by the amount that such Holder elects not to receive by such notice);
to the payment of principal of (including any defaulted interest) the(ii)Class B-1 Notes and the Class B-2 Notes, pro rata, based on their respective Aggregate Outstanding Amounts Notes, until such amounts haveamount has beenpaid in full (or, with respect to any Class B Note, has been paid in such lesseramount as the Holder of such Class B Note elects to receive(in its sole discretion by written notice to the Issuer, the Trustee, the Paying Agent and the Investment Manager) to receive, in which case, the Aggregate Outstanding Amount of such Note shall be automatically reduced by the amount that such Holder elects not to receive by such notice);
to the payment of first accrued and unpaid interest (including any(iii)defaulted interest) and then any Deferred Interest on the Class C-1 Notes and the Class C-2 Notes, pro rata, based on their respective amounts of accrued and unpaid interest Notes until such amounts have been paid in full;
to the payment of principal of the Class C-1 Notes and the Class (iv)C-2 Notes, pro rata, based on their respective Aggregate Outstanding Amounts Notes until such amount has been paid in full (or, with respect to any Class CNote, has been paid in such lesser amount as the Holder of such Class C Noteelects to receive(in its sole discretion by written notice to the Issuer, the Trustee, the Paying Agent and the Investment Manager) to receive, in which case, the Aggregate Outstanding Amount of such Note shall be automatically reduced by the amount that such Holder elects not to receive by such notice);
to the payment of first accrued and unpaid interest (including any(v)defaulted interest) and then any Deferred Interest on the Class D Notes until suchamounts have been paid in full;
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to the payment of principal of the Class D Notes until such amount(vi)has been paid in full (or, with respect to any Class D Note, has been paid in suchlesser amount as the Holder of such Class D Note elects to receive(in its sole discretion by written notice to the Issuer, the Trustee, the Paying Agent and the Investment Manager) to receive, in which case, the Aggregate Outstanding Amount of such Note shall be automatically reduced by the amount that such Holder elects not to receive by such notice);
to the payment of accrued and unpaid interest (including any(vii)defaulted interest) and any Deferred Interest on the Class E Notes until suchamounts have been paid in full;
to the payment of principal of the Class E Notes until such amount(viii)has been paid in full (or, with respect to any Class E Note, has been paid in suchlesser amount as the Holder of such Class E Note elects to receive (in its sole discretion by written notice to the Issuer, the Trustee, the Paying Agent and the Investment Manager), in which case, the Aggregate Outstanding Amount of such Note shall be automatically reduced by the amount that such Holder elects not to receive by such notice);
to the payment of accrued and unpaid interest (including any(ix)defaulted interest) and any Deferred Interest on the Class F Notes until suchamounts have been paid in full; and
to the payment of principal of the Class F Notes until such amount(x)has been paid in full (or, with respect to any Class F Note, has been paid in suchlesser amount as the Holder of such Class F Note elects to receive (in its sole discretion by written notice to the Issuer, the Trustee, the Paying Agent and the Investment Manager), in which case, the Aggregate Outstanding Amount of such Note shall be automatically reduced by the amount that such Holder elects not to receive by such notice).
“Similar Law”: Any federal, state, local, non-U.S. or other law that is similar toSection 406 of ERISA or Section 4975 of the Code.
“Special Redemption”: The meaning specified in Section 9.7.
“Special Redemption Amount”: The meaning specified in Section 9.7.
“Special Redemption Date”: The meaning specified in Section 9.7.
“Standby Directed Investment”: The meaning specified in Section 10.5.
“Stated Maturity”: With respect to any security, the maturity date specified insuch security or applicable Underlying Instrument; and with respect to the DebtNotes of anyClass, the date specified as such in Section 2.3.
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“Step-Down Obligation”: Any Collateral Obligation (other than a LIBOR FloorObligation) the Underlying Instruments of which contractually mandate decreases in couponpayments or spread over time (in each case other than decreases that are conditioned upon animprovement in the creditworthiness of the obligor or changes in a pricing grid or based onimprovements in financial ratios or other similar coupon or spread reset features); provided that aCollateral Obligation providing for payment of a constant rate of interest at all times after thedate of acquisition by the Issuer shall not constitute a Step-Down Obligation.
“Step-Up Obligation”: Any Collateral Obligation which provides for an increase,in the case of a Collateral Obligation which bears interest at a fixed rate, in the per annuminterest rate on such Collateral Obligation or, in the case of a Collateral Obligation which bearsinterest at a floating rate, in the spread over that applicable index or benchmark rate, solely as afunction of the passage of time; provided that a Collateral Obligation providing for payment of aconstant rate of interest at all times after the date of acquisition by the Issuer shall not constitutea Step-Up Obligation.
“Structured Finance Obligation”: Any obligation of a special purpose vehiclesecured directly by, referenced to, or representing ownership of, a pool of receivables or otherassets, including collateralized debt obligations, mortgage-backed securities and single-assetrepacks.
“Subordinated Management Fee”: The fee payable to the Investment Manager inarrears on each Payment Date (prorated for the related Interest Accrual Period), including anyRedemption Date, pursuant to Section 8 of the Investment Management Agreement and Section 11.1, in an amount equal to 0.30% per annum (calculated on the basis of a 360-day year and theactual number of days elapsed) of the Maximum Investment Amount at the beginning of theCollection Period relating to such Payment Date.
“Subordinated Management Fee Interest”: Interest on any accrued and unpaidSubordinated Management Fee (other than any waived Subordinated Management Fee orDeferred Subordinated Management Fee), which shall accrue at the rate of three-month LIBORplus 0.30% for the period from (and including) the date on which such SubordinatedManagement Fee shall be payable through (but excluding) the date of payment thereof(calculated on the basis of a 360-day year and the actual number of days elapsed).
“Subordinated Notes”: The Subordinated Notes issued pursuant to this Indenture and Security Agreement and having the characteristics specified in Section 2.3.
“Successor Entity”: The meaning specified in Section 7.10(a).
“Supermajority”: With respect to any Class of DebtNotes, the Holders of at least66⅔% of the Aggregate Outstanding Amount of the DebtNotes of such Class.
“Synthetic Security”: A security or swap transaction, other than a ParticipationInterest, that has payments associated with either payments of interest and/or principal on areference obligation or the credit performance of a reference obligation.
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“Tax”: Any present or future tax, levy, impost, duty, charge, assessment,deduction, withholding or fee of any nature (including interest, penalties and additions thereto)that is imposed by any government or other taxing authority other than a stamp, registration,documentation or similar tax.
“Tax Advantaged Jurisdiction”: (a) A sovereign jurisdiction that is commonlyused as the place of organization of special purpose vehicles (including but not limited to theBahamas, Bermuda, the British Virgin Islands, the Cayman Islands, the Channel Islands, Jersey,Singapore, the Netherlands Antilles or the U.S. Virgin Islands) so long as each such jurisdictionis not a jurisdiction of an Emerging Market Obligor or (b) upon notice to Moody’s with respectto the treatment of another jurisdiction as a Tax Advantaged Jurisdiction, such other jurisdiction.
“Tax Event”: (a) Any portion of any payment (other than a commitment fee,letter of credit fee, amendment fee, waiver fee, consent fee, extension fee, or similar fee, in eachcase to the extent that such withholding tax does not exceed 30% of the amount of such fees) duefrom any obligor under any Collateral Obligation becoming subject to the imposition of U.S. orforeign withholding tax, which withholding tax is not compensated for by a “gross up” provisionunder the terms of such Collateral Obligation, (b) any jurisdiction’s imposing net income, profitsor similar tax on the Issuer (including any tax liability imposed pursuant to Section 1446 of theCode or any similar provision of law), (c) any portion of any payment due under a HedgeAgreement by the Issuer becoming subject to the imposition of U.S. or foreign withholding tax,which withholding tax is compensated for by a “gross-up” provision under the terms of theHedge Agreement or (d) any portion of any payment due under a Hedge Agreement by a HedgeCounterparty becoming subject to the imposition of U.S. or foreign withholding tax, whichwithholding tax is not compensated for by a “gross-up” provision under the terms of the HedgeAgreement; provided, that the total amount of (i) the tax or taxes imposed on the Issuer asdescribed in clause (b) of this definition, (ii) the total amount withheld from payments to theIssuer which is not compensated for by a “gross-up” provision as described in clauses (a) and (d)of this definition and (iii) the total amount of any tax “gross-up” payments that are required to bemade by the Issuer as described in clause (c) of this definition are determined to be in excess of5.0% of the aggregate interest due and payable on the Collateral Obligations during theCollection Period.
“Tax Guidelines”: The guidelines appended as Annex A to the InvestmentManagement Agreement.
“Temporary Alternative Rate”: The meaning specified in the definition of “LIBOR” in this Section 1.1.
“Trading Plan”: The meaning specified in Section 12.2(d).
“Trading Plan Period”: The meaning specified in Section 12.2(d).
“Transaction Documents” : The Indenture and Security Agreement, the SecuritiesAccount Control Agreement, the Credit Agreement, the Income Note Paying AgencyAgreement, the Investment Management Agreement, the Collateral Administration Agreement,
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the Placement Agency Agreement, the Income Note Administration Agreement, the IncomeNote Registered Office Agreement, the Registered Office Agreement and the AdministrationAgreement.
“Transfer”: The meaning specified in Section 2.15(d)(ii).
“Transfer Agent”: The Person or Persons, which may be the Issuer, authorized bythe Issuer to exchange or register the transfer of Notes.
“Trustee”: As defined in the first sentence of this Indenture and Security Agreement and any successor thereto.
“UCC”: The Uniform Commercial Code as in effect in the State of New York or,if different, the political subdivision of the United States that governs the perfection of therelevant security interest as amended from time to time.
“Uncertificated Security”: The meaning specified in Section 8-102(a)(18) of theUCC.
“Underlying Instrument”: The indenture or other agreement pursuant to which aPledged Obligation has been issued or created and each other agreement that governs the termsof or secures the obligations represented by such Pledged Obligation or of which the holders ofsuch Pledged Obligation are the beneficiaries.
“Unfunded Exposure Account”: The trust account established pursuant to Section 10.3(f).
“Unpaid Class X Principal Amortization Amount”: For any Payment Date, the aggregate amount of all or any portion of the Class X Principal Amortization Amounts for any prior Payment Dates that were not paid on any Payment Date prior to such current Payment Date.
“Unregistered Securities”: The meaning specified in Section 5.17(b).
“Unscheduled Principal Payments”: All Principal Proceeds received as a result ofprepayments, redemptions, exchange offers, tender offers or other unscheduled payments (butnot sales) with respect to a Collateral Obligation (including unscheduled mandatoryprepayments); provided that, the term “Unscheduled Principal Payments” shall also include anyamounts transferred from the Unfunded Exposure Account to the Principal CollectionSubaccount for treatment as Unscheduled Principal Payments upon the unscheduled terminationor reduction of the Issuer’s funding commitment with respect to a Delayed Drawdown CollateralObligation or a Revolving Collateral Obligation.
“Unsecured Bond”: Any of a senior unsecured obligation that (a) constitutesborrowed money, (b) is in the form of, or represented by, a bond, note, certificated debt securityor other debt security (other than any of the foregoing that evidences an Unsecured Loan) and (c)which is not (and by its terms is not permitted to become) subordinate in right of payment to anyother debt for borrowed money incurred by the Obligor under such obligation.
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“Unsecured Loan”: Any assignment of or other interest in an unsecured loan thatis not subordinated to any other unsecured indebtedness of the obligor.
“U.S. Dollar” or “$”: A dollar or other equivalent unit in such coin or currency ofthe United States of America as at the time shall be legal tender for all debts, public and private.
“U.S. person”: The meaning specified in Regulation S.
“U.S. Risk Retention Rules”: The final rules implementing the credit risk retention requirements of Section 941 of the Dodd-Frank Wall Street Reform and Consumer Protection Act issued on October 21, 2014.
“Volcker Rule”: Section 13 of the U.S. Bank Holding Company Act of 1956, asamended from time to time, and the applicable rules and regulations thereunder.
“Weighted Average Fixed Coupon”: As of any Measurement Date, an amountequal to the number, expressed as a percentage, obtained by dividing:
the sum of (i) in the case of eachthe fixed rate Collateral(a)ObligationObligations (excluding any Deferrable Obligation to the extent of anynon-cash interest), the productsum of the products for each such fixed rate Collateral Obligation of (1) the then-current stated interest coupon on such Collateral Obligationand (2) the Principal Balance of such Collateral Obligation (excluding the unfundedportion of any Delayed Drawdown Collateral Obligation or Revolving CollateralObligation); plus (ii) to the extent that the amount obtained in clause (a) is insufficient to satisfy the Minimum Fixed Coupon Test, the Excess Weighted Average Floating Spread (if any); by
the lesser of (i) an amount equal to the Aggregate Principal Balance of the(b)fixed rate Collateral Obligations as of such Measurement Date (excluding (1) anyDeferrable Obligation to the extent of any non-cash interest and (2) the unfunded portionof any Delayed Drawdown Collateral Obligation or Revolving Collateral Obligation thatis a fixed rate Collateral Obligation) and (ii) the excess, if any, of the Reinvestment Target Par Balance minus the Aggregate Principal Balance of all floating rate Collateral Obligations;
provided that in the case of each of the foregoing clauses (a) and (b), in calculating the WeightedAverage Fixed Coupon in respect of any Step-Down Obligation, the coupon of such CollateralObligation shall be the lowest permissible coupon pursuant to the Underlying Instruments of theObligor of such Step-Down Obligation; provided, further, that for purposes of this definition, the stated interest coupon of any Collateral Obligation will not include non-cash interest.
“Weighted Average Floating Spread”: As of any Measurement Date, a fraction(expressed as a percentage) obtained by (i)(A) multiplying the Principal Balance of each floatingrate Collateral Obligation (including the unfunded portions of all Revolving CollateralObligations and Delayed Drawdown Collateral Obligations) held by the Issuer as of suchMeasurement Date by its Effective Spread and (B) multiplying (1) the amount equal to LIBOR
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applicable to the Rated DebtNotes during the Interest Accrual Period in which suchMeasurement Date occurs by (2) the excess (if any) of the Aggregate Principal Balance(including for this purpose, for any Collateral Obligation that is neither a Defaulted Obligationnor a Deferring Obligation, any capitalized interest) of the Collateral Obligations as of suchMeasurement Date minus the Reinvestment Target Par Balance, (ii) summing the amountsdetermined pursuant to clause (i), (iii) dividing the sum determined pursuant to clause (ii) the lesser of (A) by the Aggregate Principal Balance of all floating rate Collateral Obligations plusthe unfunded portions of all Revolving Collateral Obligations and Delayed Drawdown CollateralObligations held by the Issuer as of such Measurement Date, and (iv) if the result obtained in clause (iii) is less than the minimum percentage necessary to pass the Minimum Floating Spread Test, adding to such sum the amount of the Excess Weighted Average Fixed Coupon, if any, as of such Measurement Date and (B) the Reinvestment Target Par Balance minus the Aggregate Principal Balance of all fixed rate Collateral Obligations; provided that Defaulted Obligationsshall not be included in the calculation of the Weighted Average Floating Spread; provided,further, that in calculating the Weighted Average Floating Spread in respect of any Step-DownObligation, the Effective Spread of such Collateral Obligation shall be the lowest permissibleEffective Spread pursuant to the Underlying Instruments of the Obligor of such Step-DownObligation.
“Weighted Average Life”: As of any Measurement Date, with respect to eachallCollateral ObligationObligations (other than any Defaulted Obligations) the number of yearsfollowing such date obtained by (i) summing the products obtained by multiplying (a) theAverage Life at such time of each such Collateral Obligation by (b) the Principal Balance ofsuch Collateral Obligation and (ii) dividing such sum by the Aggregate Principal Balance at suchtime of all Collateral Obligations (excluding any Defaulted Obligations); provided that, if the Aggregate Principal Balance of the Collateral Obligations (excluding any Defaulted Obligations) exceeds the Reinvestment Target Par Balance, the Collateral Obligations included in the calculation of the Weighted Average Life shall be only those Collateral Obligations with an Aggregate Principal Balance equal to the Reinvestment Target Par Balance (starting with Collateral Obligations with the shortest Average Lives).
“Weighted Average Life Test”: A test satisfied on any date of determination ifthe Weighted Average Life of all Collateral Obligations as of such date is less than or equal to (A) 8.00 years minus (B)(1) the number of days that have elapsed since the Closing Date through the date of determination divided by (2) 365 (rounded to the nearest one hundredth thereof)(other than Defaulted Obligations) is no higher than the relevant weighted average life specified in the table below for the Amendment Date (if such Measurement Date occurs before the first Payment Date thereafter) or the Payment Date immediately preceding such Measurement Date.
Payment Date in (or Amendment Date)
Maximum Weighted Average Life Value
[TO COME] [TO COME]
“Zero-Coupon Security”: Any Collateral Obligation that at the time of purchasedoes not by its terms provide for the payment of cash interest; provided that if, after suchpurchase such Collateral Obligation provides for the payment of cash interest, it will cease to bea Zero-Coupon Security.
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Rules of Construction. Except as otherwise specified herein or asSection 1.2the context may otherwise require, terms defined in Section 1.1 hereto shall have the respectivemeanings set forth in Section 1.1 for all purposes of this Indenture and Security Agreement, andthe definitions of such terms are equally applicable both to the singular and plural forms of suchterms and to the masculine, feminine and neuter genders of such terms. The word “including”shall mean “including without limitation.” All references in this Indenture and Security Agreement to designated “Articles,” “Sections,” “Subsections” and other subdivisions are to thedesignated articles, sections, subsections and other subdivisions of this Indenture and Security Agreement. The words “herein,” “hereof,” “hereunder” and other words of similar import referto this Indenture and Security Agreement as a whole and not to any particular article, section,subsection or other subdivision.
Assumptions as to Pledged Obligations. Unless otherwiseSection 1.3specified, the assumptions described below shall be applied in connection with all calculationsrequired to be made pursuant to this Indenture and Security Agreement with respect toScheduled Distributions on any Pledged Obligation, or any payments on any other assetsincluded in the Assets, with respect to the sale of and reinvestment in Collateral Obligations, andwith respect to the income that can be earned on Scheduled Distributions on such PledgedObligations and on any other amounts that may be received for deposit in the CollectionAccount.
All calculations with respect to Scheduled Distributions on the Pledged(a)Obligations securing the DebtNotes shall be made on the basis of information as to the terms ofeach such Pledged Obligation and upon report of payments, if any, received on such PledgedObligation that are furnished by or on behalf of the issuer of such Pledged Obligation and, to theextent they are not manifestly in error, such information or report may be conclusively reliedupon in making such calculations.
For purposes of calculating the Coverage Tests and the Reinvestment(b)Diversion Test, except as otherwise specified in the Coverage Tests and the ReinvestmentDiversion Test, such calculations shall not include scheduled interest and principal payments onDefaulted Obligations unless or until such payments are actually made.
For each Collection Period and as of any date of determination, the(c)Scheduled Distribution on any Pledged Obligation (other than a Defaulted Obligation, which,except as otherwise provided herein, shall be assumed to have a Scheduled Distribution of zero)shall be the sum of (i) the total amount of payments and collections to be received during suchCollection Period in respect of such Pledged Obligation (including the proceeds of the sale ofsuch Pledged Obligation received and, in the case of sales which have not yet settled, to bereceived during the Collection Period and not reinvested in additional Collateral Obligations orEligible Investments or retained in the Collection Account for subsequent reinvestment pursuantto Section 12.2) that, if paid as scheduled, shall be available in the Collection Account at the endof the Collection Period and (ii) any such amounts received by the Issuer in prior CollectionPeriods that were not disbursed on a previous Payment Date.
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Each Scheduled Distribution receivable with respect to a Pledged(d)Obligation shall be assumed to be received on the applicable Due Date, and each such ScheduledDistribution shall be assumed to be immediately deposited in the Collection Account to earninterest at the Assumed Reinvestment Rate. All such funds shall be assumed to continue to earninterest until the date on which they are required to be available in the Collection Account forapplication, in accordance with the terms hereof, to payments of principal of or interest on theNotes or other amounts payable pursuant to this Indenture and Security Agreement. For theavoidance of doubt, all amounts calculated pursuant to this Section 1.3(d) are estimates and maydiffer from the actual amounts available to make distributions hereunder, and no party shall haveany obligation to make any payment hereunder due to the assumed amounts calculated under thisSection 1.3(d) being greater than the actual amounts available. For purposes of the applicabledeterminations required by Section 10.6(b)(iv), Article XII and the definition of “InterestCoverage Ratio,” the expected interest on Rated Notes and floating rate Collateral Obligationsshall be calculated using the then current interest rates applicable thereto.
References in Section 11.1(a) to calculations made on a “pro forma basis”(e)shall mean such calculations after giving effect to all payments, in accordance with the Priorityof Payments described herein, that precede (in priority of payment) or include the clause inwhich such calculation is made.
For the purposes of calculating the Moody’s Weighted Average Rating(f)Factor, any Collateral Obligation that is a Current Pay Obligation or a Defaulted Obligation shallbe excluded.
For the purposes of calculating the Incentive Management Fee Threshold,(g)[(x)] the purchase price of the Subordinated Notes issued on the Closing Date shall be deemed tobe 100% [and (y) the purchase price of the Subordinated Notes issued on the Amendment Date shall be deemed to be [__]%].
Except as otherwise provided herein, Defaulted Obligations shall not be(h)included in the calculation of the Portfolio Quality Test.
For purposes of calculating all Concentration Limitations, in both the(i)numerator and the denominator of any component of the Concentration Limitations, DefaultedObligations shall be treated as having a principal balance equal to zero.
For purposes of calculating compliance with the Investment Criteria, upon(j)the direction of the Investment Manager by notice to the Trustee, the Collateral Agent and theCollateral Administrator, any Eligible Investment representing Principal Proceeds received uponthe maturity, redemption, sale or other disposition of Collateral Obligations shall be deemed tohave the characteristics of such Collateral Obligations until reinvested in additional CollateralObligations. Such calculations shall be based upon the principal amount of such CollateralObligations, except in the case of Defaulted Obligations and Credit Risk Obligations, in whichcase the calculations shall be based upon the Principal Proceeds received on the disposition orsale of such Defaulted Obligations or Credit Risk Obligations.
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For purposes of calculating the Sale Proceeds of a Collateral Obligation in(k)sale transactions, Sale Proceeds shall include any Principal Financed Accrued Interest receivedin respect of such sale.
For purposes of calculating clause (iii) of the definition of Concentration(l)Limitations, without duplication, the amounts on deposit in the Collection Account and theRamp-Up Account (including Eligible Investments therein) representing Principal Proceeds shalleach be deemed to be a floating rate Collateral Obligation that is a Senior Secured Loan.
Notwithstanding any other provision of this Indenture and Security (m)Agreement to the contrary, all monetary calculations under this Indenture and Security Agreement shall be in U.S. Dollars.
Unless otherwise specified, any reference to the fee payable under Section (n)11.1 to an amount calculated with respect to a period at per annum rate shall be computed on thebasis of a 360-day year and the actual number of days elapsed. Any fees applicable to periodsshorter than or longer than a calendar quarter shall be prorated to the actual number of dayswithin such period.
Unless otherwise specified, test calculations that evaluate to a percentage(o)shall be rounded to the nearest ten-thousandth and test calculations that evaluate to a numbershall be rounded to the nearest one-hundredth.
Unless otherwise specifically provided herein, all calculations required to(p)be made and all reports which are to be prepared pursuant to this Indenture and Security Agreement shall be made on the basis of the trade date.
Determination of the purchase price of a Collateral Obligation shall be(q)made independently each time such Collateral Obligation is purchased by the Issuer and pledgedto the Collateral AgentTrustee, without giving effect to whether the Issuer has previouslypurchased such Collateral Obligation (or an obligation of the related borrower or issuer).
When calculating the results of any vote, consent or other action by(r)Holders of DebtNotes hereunder, the Collateral AgentTrustee shall consider only the registeredowners of the DebtNotes except to the extent that (in connection with such vote, consent or otheraction) any Person has certified to the Collateral AgentTrustee in writing substantially in theform of Exhibit D to this Indenture and Security Agreement that it is the owner of a beneficialinterest in such Global Note or a Class A Lender, as applicable.
Any future anticipated tax liabilities of an Issuer Subsidiary related to an(s)Issuer Subsidiary Asset held by such Issuer Subsidiary shall be excluded from the calculation ofthe Weighted Average Floating Spread and Weighted Average Fixed Coupon (which exclusion,for the avoidance of doubt, may result in such Issuer Subsidiary Asset having a negative interestrate spread or coupon for purposes of such calculations) and the Interest Coverage Ratio withrespect to any specified Class or Classes of Rated DebtNotes.
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To the extent of any ambiguity in the interpretation of any definition or (t)term contained in this Indenture or to the extent more than one methodology can be used to make any of the determinations or calculations set forth herein, the Investment Manager may direct the Collateral Administrator, or the Collateral Administrator may request direction from the Investment Manager as to the interpretation and/or methodology to be used, and in either case the Collateral Administrator may follow such direction, and together with the Trustee, may be entitled to conclusively rely thereon without any responsibility or liability therefor.
Any direction or Issuer Order required hereunder relating to the purchase, (u)acquisition, sale, disposition or other transfer of Assets may be in the form of a trade ticket, confirmation of trade, instruction to post or to commit to the trade or similar instrument or document or other written instruction (including by email or other electronic communication or file transfer protocol) from the Issuer on which the Trustee may rely.
ARTICLE II
THE NOTES
Forms Generally. The Notes and the Trustee’s or AuthenticatingSection 2.1Agent’s certificate of authentication thereon (the “Certificate of Authentication”) shall be insubstantially the forms required by this Article, with such appropriate insertions, omissions,substitutions and other variations as are required or permitted by this Indenture and Security Agreement, and may have such letters, numbers or other marks of identification and suchlegends or endorsements placed thereon, as may be consistent herewith, determined by theAuthorized Officers of the Applicable Issuers executing such Notes as evidenced by theirexecution of such Notes. Any portion of the text of any Note may be set forth on the reversethereof, with an appropriate reference thereto on the face of the Note.
Forms of Notes. (a) The forms of the Notes, including the formsSection 2.2of Certificated Notes, Regulation S Global Notes, ERISA Restricted Certificated Notes, ERISARestricted Global Notes and Rule 144A Global Notes shall be as set forth in the applicable partof Exhibit A hereto.
Regulation S Global Notes, Rule 144A Global Notes and Certificated (b)Notes. (i) The Rated Notes of each Class and the Subordinated Notes sold to persons who arenot U.S. persons in offshore transactions in reliance on Regulation S shall each be issued initiallyin the form of one permanent global note per Class in definitive, fully registered form withoutinterest coupons substantially in the applicable form of Exhibit A1, A2, A3, A4, A55, or A6hereto, in the case of the Rated Notes (each, a “Regulation S Global Rated Note”), in the form ofExhibit A7 hereto, in the case of the Subordinated Notes (each, a “Regulation S Global Subordinated Note”), and shall be deposited with the Trustee as custodian for, and registered inthe name of a nominee of, DTC for the respective accounts of Euroclear and Clearstream, dulyexecuted by the Applicable Issuers and authenticated by the Trustee as hereinafter provided.
The Notes sold to persons that are QIB/QPs shall each be issued initially(ii)in the form of one permanent global note per Class in definitive, fully registered form
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without interest coupons substantially in the applicable form of Exhibit A1, A2, A3, A4,A55, or A6 hereto, in the case of the Rated Notes (each, a “Rule 144A Global Rated Note”), in the applicable form of Exhibit A7 hereto, in the case of the Subordinated Notes(each, a “Rule 144A Global Subordinated Note”), which shall be deposited with theTrustee as custodian for, and registered in the name of a nominee of, DTC, duly executedby the Applicable Issuers and authenticated by the Trustee as hereinafter provided.
Any Rated Notes sold to persons that are IAI/QPs (and not Qualified InstitutionalBuyers) shall be issued in the form of definitive, fully registered notes without interestcoupons substantially in the applicable form of Exhibit A1, A2, A3, A4, A55, or A6hereto (each, a “Certificated Rated Note”), which shall be registered in the name of thebeneficial owner or a nominee thereof, duly executed by the Issuer and authenticated bythe Trustee as hereinafter provided. The Subordinated Notes sold to persons that areAI/QPs (and not Qualified Institutional Buyers) shall be issued in the form of definitive,fully registered notes without coupons substantially in the form of Exhibit A7 hereto,with respect to the Subordinated Notes (each, a “Certificated Subordinated Note”) ineach case which shall be registered in the name of the beneficial owner or a nomineethereof, duly executed by the Issuer and authenticated by the Trustee as hereinafterprovided.
The aggregate principal amount of the Regulation S Global Notes and the(iii)Rule 144A Global Notes may from time to time be increased or decreased by adjustmentsmade on the records of the Trustee or DTC or its nominee, as the case may be, ashereinafter provided.
Book Entry Provisions. This Section 2.2(b) shall apply only to Global(c)Notes deposited with or on behalf of DTC.
Agent Members and owners of beneficial interests in Global Notes shall have norights under this Indenture and Security Agreement with respect to any Global Notes held by theTrustee, as custodian for DTC and DTC may be treated by the Co-Issuers, the Trustee, and anyagent of the Co-Issuers or the Trustee as the absolute owner of such Note for all purposeswhatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Co-Issuers, theTrustee, or any agent of the Co-Issuers or the Trustee, from giving effect to any writtencertification, proxy or other authorization furnished by DTC or impair, as between DTC and itsAgent Members, the operation of customary practices governing the exercise of the rights of aHolder of any Note.
Certificated Notes. Following the Closing Date and except as provided in(d)Section 2.6(a) and Section 2.11, owners of beneficial interests in Global Notes shall not beentitled to receive physical delivery of Certificated Notes.
Authorized Amount; Stated Maturity; Denominations. TheSection 2.3aggregate principal amount of the Notes that may be authenticated and delivered under thisIndenture and Security Agreement is limited to U.S.$642,850,000 [__] aggregate principalamount of Notes. U.S.$200,000,000 of Class A Loans may be incurred pursuant to the Credit Agreement. Additional DebtNotes may be issued and/or incurred pursuant to Section 2.4 or the
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Credit Agreement, as applicable, and Debtand Notes issued and/or incurred pursuant tosupplemental indenture and security agreementsindentures in accordance with Article VIII or the Credit Agreement, as applicable.
Such DebtNotes shall be divided into the Classes, having the designations,original principal amounts and other characteristics as follows:
Debt
Notes
Class Designation Class A-1X Notes Class A-2 NotesClass AB
LoansNotes Class B-1C Notes Class B-2D Notes
Original PrincipalAmount
$140,000,000[__](1) $50,000,000[__](1) $200,000,000[__] $62,000,000[__] $10,000,000[__]
Stated Maturity Payment Date in July 2026[__]
Payment Date in July 2026[__]
Payment Date inJuly[__] 2026
Payment Date in July 2026[__]
Payment Date in July 2026[__]
Index LIBOR LIBOR LIBOR LIBOR LIBOR
Index Maturity 3 month 3 month 3 month 3 month 3 month
Spread 1.51[__]% 1.45[__]% 1.51[__]% 2.10[__]% 2.20[__]%
Initial Rating(s):
Moody’s “[Aaa(sf)]” “[Aaa(sf)]” “Aaa(sf)[Aa2]” “Aa[A2(sf)]” “Aa2(sf)[Baa3]”
Fitch “AAAsf[NR]” “AAAsf[AAA]” “AAAsf”None N/ANone N/ANone
Ranking:
Pari Passu Class(es) Class A-2 Notes, Class A Loans
Class A-1 Notes, Class A LoansX
Class A-1 Notes, Class A-2 NotesNone
Class B-2 NotesNone Class B-1 NotesNone
Priority Classes None None NoneX, A X, A(2), B X, A(2), B, C
Junior Classes B, C, D, E, F,Subordinated
B, C, D, E, F,Subordinated
B, C, D, E, F,Subordinated
C, D, E, F,Subordinated
C, D, E, F,Subordinated
Listed Notes Yes Yes Yes Yes Yes
Deferred InterestNotes
No No No NoYes NoYes
ERISA RestrictedNotes
No No No No No
Applicable Issuer(s) Co-Issuers Co-Issuers Co-Issuers Co-Issuers Co-Issuers
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ClassDesignation
Class C-1
Notes
Class C-2
Notes
Class D Notes
ClassE
Notes
ClassF
Notes
Subordinated Notes
OriginalPrincipalAmount
$28,500,000
$20,000,000
$30,500,000
$31,000,000[__]
$10,700,000[__]
$60,150,000[
__]
StatedMaturity
Payment Date in July 2026
Payment Date in July 2026
Payment Date in July 2026
Payment
Datein
July 2026[
__]
Payment
Datein
July 2026[
__]
Payment
Datein July 2026[_
_]
Index LIBOR LIBOR LIBOR LIBOR LIBOR N/A
IndexMaturity
3 month 3 month 3 month 3month
3month
N/A
Spread 3.05% 3.20% 3.90% 5.25[__]%
6.10[__]%
N/A
InitialRating(s):
Moody’s
“A3(sf)” “A3(sf)” “Baa3(sf)”
“[Ba3(sf)]”
“[B3(sf)]”
N/ANone
Fitch N/A N/A N/A N/ANone
N/ANone
N/ANone
Ranking:
PariPassuClass(es)
Class C-2
Notes
Class C-1
Notes
None None None None
PriorityClasses
A, B A, B A, B, C X, A,B, C, D
X, A,B, C,D, E
X, A,B, C,E, F
JuniorClasses
D, E, F, Subordi
nated
D, E, F, Subordi
nated
E, F, Subordi
nated
F,Subordinat
ed
Subordinat
ed
None
Listed Notes Yes Yes Yes Yes Yes No
DeferredInterest Notes
Yes Yes Yes Yes Yes N/A
ERISARestrictedNotes*
No No No Yes Yes Yes
ApplicableIssuer(s)
Co-Issuers
Co-Issuers
Co-Issuers
Issuer Issuer Issuer
* The ERISA Restricted Certificated Notes, subject to certain limitations, shall be available to Benefit Plan Investors and Controlling Persons;provided, that Subordinated Notes may not be held by Benefit Plan Investors.
(1) The Aggregate Outstanding Amount of the Class A-1 Notes may be increased up to $340,000,000 upon a conversion of the Aggregate Outstanding Amount of the Class A Loans in accordance with this Indenture and Security Agreement and the Credit Agreement.Payments
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of principal and interest on the Class X Notes and the Class A Notes will be pari passu. However, principal of the Class X Notes will be payable from both Interest Proceeds and Principal Proceeds.
(2) For purposes of the table above, “A” means the Class A Loans, the Class A-1 Notes and the Class A-2 Notes.
The Notes shallClass X Notes, the Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes will be issued in minimum denominations of (a) for Classes of Rated Notes other than the Class E Notes and the Class F Notes, U.S.$250,000 and integralmultiples of U.S.$1.00 in excess thereof, (b) for and the Class E Notes, Class F Notes and the Class F Notes, U.S.$500,000 and integral multiples of U.S.$1.00 in excess thereof and (c) for theSubordinated Notes, will be issued in minimum denominations of U.S.$2,000,000[__] andintegral multiples of U.S.$1.00 in excess thereof (the “Authorized Integrals”); provided, that solely with respect to the Class X Notes that are included in the Retention Interest, such Class X Notes may be issued in a minimum denomination of U.S.$[__] and integral multiples of U.S.$1.00 in excess thereof; provided, further, that solely in connection with a transfer of Class E Notes, Class F Notes or Subordinated Notes after the ClosingAmendment Date, the minimumdenominations of Subordinatedsuch Notes subject to any such transfer may be less thanU.S.$2,000,000[__] if (x) after giving effect to such transfer, each ofeither (i) the transferor and the transferee owns either (i) U.S.$0 in Aggregate Principal Amount of Subordinated Notes or (ii) at least U.S.$2,000,000 Aggregate Principal Amount of Subordinated Notes or (y) such transfer is to an existing beneficial owner of Subordinated Notes in an amount of not less than U.S.$250,000.aggregate principal amount of such Notes or (ii) the transferee and (unless such transfer is being made to the Income Note Issuer) the transferor owns at least U.S.$[__] in aggregate principal amount of such Notes.
Additional DebtNotes. At any time duringDuring theSection 2.4Reinvestment Period (or, with respect to the Subordinated Notes and/or Junior Mezzanine Notes,at any time) and subject to the conditions set forth in Section 3.2,3.2, the Co-Issuers (or the Issuer alone) may (w) issue and sell (x) additional notes of any one or more new classes of notesthat are fully subordinated to the existing Rated DebtNotes (or to the most junior class ofsecurities of the Applicable Issuer (other than the Subordinated Notes) issued pursuant to thisIndenture and Security Agreement, if any class of securities issued pursuant to this Indenture and Security Agreement other than the Rated Notes and the Subordinated Notes is then Outstanding)(such additional notes, “Junior Mezzanine Notes”), (x) issue and selly) additional SubordinatedNotes, (y) issue and sell/or (z) additional notes of the existing Classes of Rated Notes (and for this purpose, the Class A-1 Notes, the Class A-2 Notes and the Class A Loans shall be treated as separate classes) and/or (z) incur additional Class A Loans. The net proceeds from an issuance of Additional Debt pursuant to this Section 2.4 may be (x) usedother than the Class X Notes) and, in each case, use the net proceeds to purchase additional Collateral Obligations, (y) in the case of additional issuance of Subordinated Notes and/or Junior Mezzanine Notes, treated as Interest Proceeds or (z) used or as otherwise permitted under this Indenture and Security Agreement. Any issuance of Additional Debt pursuant to this Section 2.4 shall be subject to the satisfaction of, provided, that the following conditions are met:
such issuance and/or incurrence is consented to in writing by a Majority of(i)the Subordinated Notes in writing and by the Investment Manager;
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in the case of additional notes of any one or more existing Classes, unless(ii)only additional Subordinated Notes and/or Junior Mezzanine Notes are being issued, theInvestment Manager;(ii) in the case of additional debt of any one or more existing Classes, the aggregate principal amount of DebtNotes of such Class issued and/or incurred in the aggregate shallin all additional issuances may not exceed 100% of therespective original aggregate outstanding principal amount of the DebtNotes of suchClass;
if additional debtnotes of any one or more existing Classes are being(iii)issued and/or incurred, unless such additional notes are being issued in furtherance of compliance with the U.S. Risk Retention Rules, each existing holder shall have the rightto purchase such additional debtnotes to maintain their proportional ownership of theapplicable Class; provided, that any additional Junior Mezzanine Notes issued as described above will, to the extent reasonably practicable, be offered first to the existing Holders of Subordinated Notes and any Junior Mezzanine Notes (as applicable) in a sufficient amount to allow such Holders to maintain their proportional ownership within such Classes on a combined basis: provided further, that any such offer to an existing Holder of Subordinated Notes or any Junior Mezzanine Notes which has not been accepted within three (3) Business Days after delivery of such offer by, or on behalf of, the Issuer shall be deemed a notice by such Holder that it declines to purchase such Additional Notes;
in the case of additional debtnotes of any one or more existing Classes, the(iv)terms of the debtnotes issued or incurred, as applicable, must be identical to therespective terms of previously issued and/or incurred DebtNotes of the applicable Class(except that the interest due on additional debtnotes will accrue from the issue or incurrence date, as applicable, of such additional debtnotes and the spread over LIBORand price of such debt donotes does not have to be identical to those of the initialDebtNotes of that Class; provided, that the spread over LIBOR on such debt maynotes must not exceed the spread over LIBOR applicable to the initial Rated DebtNotes of thatClass);
in the case of an issuance and/or incurrence of additional Debt of an (v)existing Class other than the Subordinated Notes and Junior Mezzanine Notes, such additional debt shall be issued and/or incurred at a Cash sales price equal to or greater than the principal amount thereof;(vi) in the case of additional debtadditional notesof any one or more existing Classes, unless only additional Subordinated Notes or JuniorMezzanine Notes are being issued, additional debtnotes of all Classes must be issuedand/or incurred and such issuance or incurrence, as applicable, of additional debtnotesmust be proportional across all Classes (and, for the purpose of satisfying the requirements of this clause (vi), the Class A-1 Notes, the Class A-2 Notes and the Class A Loans shall be treated as a single Class with the effect that any Class comprising Class A Obligations may be issued),; provided, that the principal amount of SubordinatedNotes and/or Junior Mezzanine Notes issued in any such issuance may exceed theproportion otherwise applicable to the Subordinated Notes and/or Junior MezzanineNotes;
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(vii) the Rating Agencies shall have been notified of such additional(vi)issuance and/or incurrence;
(viii) the proceeds of any additional debtnotes (net of fees and expenses(vii)incurred in connection with such issuance and/or incurrence) shall be treated as PrincipalProceeds and used to purchase additional Collateral Obligations, to invest in EligibleInvestments or to apply pursuant to the Priority of Payments; provided, however, that theInvestment Manager may elect to treat any portion ofdesignate the proceeds from the issuance of additional Subordinated Notes and/or additional Junior Mezzanine Notes as Interest Proceedsfor any Permitted Use;
(ix) immediately after giving effect to such issuance and/or incurrence, (viii)each Par Value Ratio is maintained or improved;unless only additional Subordinated Notes or Junior Mezzanine Notes are being issued, each Par Value Ratio is maintained or improved immediately after giving effect to such issuance and the application of the proceeds thereof;
(x) an opinion of tax counsel of nationally recognized standing in the(ix)United States experienced in such matters shall be delivered to the Issuer and the Trusteeto the effect that (A) any additional Class A ObligationsNotes, Class B Notes, Class CNotes, or Class D Notes will be treated, and any additional Class E Notes [and/or Class F Notes] should, be treated, as indebtedness for U.S. federal income tax purposes, and (B)such additional issuance and/or incurrence will not cause the Issuer to be subject to tax liability under Section 1446 of the Code or, unless waived by the Initial Majority Subordinated Noteholder, to be treated as a publicly traded partnership taxable as acorporation for U.S. federal income tax purposes, and (C) such additional issuance and/or incurrence will not have a material adverse effect on the tax consequences to the holders of any Class of Debt Outstanding at the time of such additional issuance and/or incurrence, as described under the heading “Certain U.S. Federal Income Tax Considerations” in the Offering Circular,; provided, however, that the opinion describedin clause (xix)(A) will not be required with respect to any additional Notes that bear adifferent CUSIP (or equivalent identifier) from the Notes of the same Class that wereissued on the ClosingAmendment Date and are Outstanding at the time of the additionalissuance; and
(xi) suchthe additional issuance will beis accomplished in a manner that(x)allowspermits the Issuer to accurately provide (or cause to be provided)report the taxinformation relating to original issue discount required to be provided to the Holders ofNotes (including the additional notesNotes).
(b) Any additional Subordinated Notes or Junior Mezzanine Notes (of an existing class of Junior Mezzanine Notes) issued as described above will, first, be offered to the existing Holders of Subordinated Notes or Junior Mezzanine Notes (as applicable) in a sufficient amount to allow such Holders to maintain their proportional ownership within such Class. Any Junior Mezzanine Notes (of a not already existing class of Junior Mezzanine Notes)Notes of any Class issued as described above will first be offered to the existing Holders of Subordinated
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Notes in a sufficient amount to allow such Holders to purchase a share of such additional notes proportional to its then current ownership of Subordinated Notes. Any(other than a Risk Retention Issuance) will, to the extent reasonably practicable, be offered first to Holders of that Class in such amounts as are necessary to preserve their pro rata holdings of Notes of such Class; provided that any additional Junior Mezzanine Notes issued as described above will, to the extent reasonably practicable, be offered first to the Holders of the Subordinated Notes and any existing Junior Mezzanine Notes in such amounts as are necessary to preserve their pro rata holdings of the Junior Mezzanine Notes and the Subordinated Notes on a combined basis. With respect to any additional Subordinated Notes or Junior Mezzanine Notes, if any such holder declines such offer in the preceding sentences, its portion of additional Subordinated Notes or Junior Mezzanine Notes will be offered to the holders of Subordinated Notes and/or Junior Mezzanine Notes that accept such offer as are necessary to preserve the pro rata holdings of additional Junior Mezzanine Notes and/or Subordinated Notes, collectively, of the accepting Holders. Any such offer to an existing Holder of Notes required by this paragraph whichSubordinated Notes or existing Junior Mezzanine Notes that has not been accepted withinfive (5)three Business Days after delivery of such offer by or on behalf of the Issuer shall bedeemed a notice by such Holder that it declines to purchase additional Debt.notes. Purchasers and transferees of Junior Mezzanine Notes will be deemed to make the representations made by the Holders of Subordinated Notes in Section 2.6 and Section 2.15.
(c) Any additional Class A Loans shall be incurred under and pursuant to the Credit Agreement.
Execution, Authentication, Delivery and Dating. The Notes shallSection 2.5be executed on behalf of each of the Applicable Issuers by one of their respective AuthorizedOfficers. The signature of such Authorized Officer on the Notes may be manual or facsimile.
Notes bearing the manual or facsimile signatures of individuals who were at anytime the Authorized Officers of the Issuer or the Co-Issuer, as applicable, shall bind the Issuerand the Co-Issuer, notwithstanding the fact that such individuals or any of them have ceased tohold such offices prior to the authentication and delivery of such Notes or did not hold suchoffices at the date of issuance of such Notes.
At any time and from time to time after the execution and delivery of thisIndenture and Security Agreement, the Issuer and the Co-Issuer may deliver Notes executed bythe Applicable Issuers to the Trustee or the Authenticating Agent for authentication and theTrustee or the Authenticating Agent, upon Issuer Order, shall authenticate and deliver suchNotes as provided in this Indenture and Security Agreement and not otherwise.
Each Note authenticated and delivered by the Trustee or the Authenticating Agentupon Issuer Order on the Closing Date shall be dated as of the Closing Date. All other Notesthat are authenticated after the Closing Date for any other purpose under this Indenture and Security Agreement shall be dated the date of their authentication.
Notes issued upon transfer, exchange or replacement of other Notes shall beissued in Authorized Integrals reflecting the original Aggregate Outstanding Amount of theNotes so transferred, exchanged or replaced, but shall represent only the current Outstanding
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principal amount of the Notes so transferred, exchanged or replaced. In the event that any Noteis divided into more than one Note in accordance with this Article II, the original principalamount of such Note shall be proportionately divided among the Notes delivered in exchangetherefor and shall be deemed to be the original aggregate principal amount (or original aggregateface amount, as applicable) of such subsequently issued Notes.
No Note shall be entitled to any benefit under this Indenture and Security Agreement or be valid or obligatory for any purpose, unless there appears on such Note aCertificate of Authentication, substantially in the form provided for herein, executed by theTrustee or by the Authenticating Agent by the manual signature of one of their AuthorizedOfficers, and such certificate upon any Note shall be conclusive evidence, and the only evidence,that such Note has been duly authenticated and delivered hereunder.
Registration, Registration of Transfer and Exchange. (a) TheSection 2.6Issuer shall cause to be kept a register (the “Register”) at the Corporate Office in which, subjectto such reasonable regulations as it may prescribe, the Issuer shall provide for the registration ofNotes and the registration of transfers of Notes. The Trustee is hereby initially appointed“Registrar” for the purpose of registering Notes and transfers of such Notes with respect to theRegister maintained in the United States as herein provided. Upon any resignation or removal ofthe Registrar, the Issuer shall promptly appoint a successor.
If a Person other than the Trustee is appointed by the Issuer as Registrar, theIssuer shall give the Trustee prompt written notice of the appointment of a Registrar and of thelocation, and any change in the location, of the Register, and the Trustee shall have the right toinspect the Register at all reasonable times and to obtain copies thereof and the Trustee shallhave the right to rely upon a certificate executed on behalf of the Registrar by an Officer thereofas to the names and addresses of the Holders of the Notes and the principal or face amounts andnumbers of such Notes. Upon request at any time the Registrar shall provide to the Issuer, theInvestment Manager, the Placement Agent or any Holder a current list of Holders as reflected inthe Register and a copy of each certification in the form of Exhibit D that it has received. Inaddition and upon request at any time, the Registrar shall obtain (at the Issuer’s expense) andprovide to the Issuer, the Investment Manager and the Placement Agent a copy of the securitiesposition report from DTC.
Subject to this Section 2.6, upon surrender for registration of transfer of anyNotes at the office or agency of the Co-Issuers to be maintained as provided in Section 7.2, theApplicable Issuers shall execute, and the Trustee shall authenticate and deliver, in the name ofthe designated transferee or transferees, one or more new Notes of any AuthorizedDenominationIntegrals and of a like aggregate principal or face amount. At any time, thePlacement Agent may request a list of Holders from the Trustee and the Trustee at the Issuer’sexpense shall provide such a list of Holders to the extent such information is available to theTrustee.
At the option of the Holder, Notes may be exchanged for Notes of like terms, inany Authorized Integrals and of like aggregate principal or face amount, upon surrender of theNotes to be exchanged at such office or agency. Whenever any Note is surrendered for
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exchange, the Applicable Issuers shall execute, and the Trustee shall authenticate and deliver,the Notes that the Holder making the exchange is entitled to receive.
All Notes issued and authenticated upon any registration of transfer or exchangeof Notes shall be the valid obligations of the Issuer and, solely in the case of the Class A Notes,the Class B Notes, the Class C Notes, the Class D Notes, the Class E Notes and the Class FNotes, the Co-Issuer, evidencing the same debt (to the extent they evidence debt), and entitled tothe same benefits under this Indenture and Security Agreement as the Notes surrendered uponsuch registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or exchange shallbe duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory tothe Registrar duly executed by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made to a Holder for any registration of transfer orexchange of Notes, but the Registrar or the Trustee may require payment of a sum sufficient tocover any tax or other governmental charge payable in connection therewith. The Trustee andthe Registrar shall be permitted to request such evidence reasonably satisfactory to itdocumenting the identity and/or signature of the transferor and the transferee.
No Note may be sold or transferred (including, without limitation, by(b)pledge or hypothecation) unless such sale or transfer is exempt from the registrationrequirements of the Securities Act, is exempt from the registration requirements under applicablestate securities laws and will not cause either of the Co-Issuers to become subject to therequirement that it register as an investment company under the Investment Company Act.
(i) Each purchaser and transferee of Class X Notes, Class A Notes, Class(c)B Notes, Class C Notes and Class D Notes or any interest in such Notes shall be required (or, inthe case of a transferee of Class X Notes, Class A Notes, Class B Notes, Class C Notes and ClassD Notes represented by an interest in a Global Note, deemed) on each day from the date onwhich such beneficial owner acquires its interest in any such Notes through and including thedate on which such beneficial owner disposes of its interest in such Notes to represent and agreethat either (1) it is not, and is not directly or indirectly acquiring such Notes (or any interesttherein) on behalf of or with assets of, a Benefit Plan Investor, or a governmental, church,non-U.S. or other plan that is subject to Similar Law or (2) its acquisition, holding anddisposition of any such Note will not constitute or result in a non-exempt prohibited transactionunder Section 406 of ERISA or Section 4975 of the Code or a non-exempt violation of SimilarLaw.
Each purchaser of an ERISA Restricted Global Note on the Closing Date(ii)or the Amendment Date, as applicable, and each purchaser and transferee of an ERISARestricted Certificated Note has completed and delivered to the Issuer, a subscriptionagreement containing ERISA-related representations, warranties and covenants.
Each transferee of the ERISA Restricted Global Notes shall be deemed to(iii)represent on each day from the date on which such beneficial owner acquires its interestin such Notes through and including the date on which such beneficial owner disposes of
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its interest in such Notes to represent and agree that (1) it is not, and is not directly orindirectly acquiring such Notes (or any interest therein) on behalf of or with assets of, aBenefit Plan Investor or a Controlling Person and (2) if it is a governmental, church,non-U.S. or other plan that is subject to Similar Law, its acquisition, holding anddisposition of such Notes will not constitute or result in a violation of such substantiallySimilar Law.
Each initial purchaser and transferee of Subordinated Notes in the form of(iv)Rule 144A Global Subordinated Notes or Regulation S Global Subordinated Notes shallbe deemed to represent and agree that on each day from the date on which such beneficialowner acquires its interest in any such Subordinated Notes through and including the dateon which such beneficial owner disposes of its interest in such Subordinated Notes (1) itis not, and is not directly or indirectly acquiring such Notes (or any interest therein) onbehalf of or with assets of, a Benefit Plan Investor, and (2) if it is a governmental, church,non-U.S. or other plan that is subject to Similar Law, its acquisition, holding anddisposition of such Subordinated Notes will not constitute or result in a non-exempt violation of Similar Law.
If such beneficial owner is a Benefit Plan Investor, on each day from the (v)date on which such beneficial owner acquires such Note or interest through and including the date on which it disposes of such Note or interest, and at any time when regulation 29 C.F.R. Section 2510.3-21, as modified in 2016, is applicable, such beneficial owner represents and warrants that (a) the fiduciary making the decision to invest in the Notes on its behalf (the “Independent Fiduciary”) is a bank, insurance company, registered investment adviser, broker-dealer or other person with financial expertise, in each case as described in 29 C.F.R. Section 2510.3-21(c)(1)(i); (b) the Independent Fiduciary is an independent plan fiduciary within the meaning of 29 C.F.R. Section 2510.3-21(c); (c) the Independent Fiduciary is capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies; (d) the Independent Fiduciary is responsible for exercising independent judgment in evaluating the acquisition, holding and disposition of the Notes; and (e) neither the Benefit Plan Investor nor the Independent Fiduciary is paying or has paid any fee or other compensation to any of the Issuer, the Co-Issuer, the Initial Purchaser, the Trustee or the Investment Manager for investment advice (as opposed to other services) in connection with its acquisition or holding of the Notes. In addition, such beneficial owner acknowledges and agrees that the Independent Fiduciary (x) has been informed that none of the Issuer, the Co-Issuer, the Initial Purchaser or the Investment Manager, or other persons that provide marketing services, nor any of their affiliates, has provided, and none of them will provide, impartial investment advice and they are not giving any advice in a fiduciary capacity, in connection with the beneficial owner’s acquisition or holding of the Notes and (y) has received and understands the disclosure of the existence and nature of the financial interests contained in the offering circular and related materials.
The Trustee shall not be responsible for ascertaining whether any transfer(d)complies with, or for otherwise monitoring or determining compliance with, the requirements orterms of the Securities Act, applicable state securities laws, ERISA, the Code or the Investment
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Company Act; except that if a certificate is specifically required by the terms of this Section 2.6to be provided to the Trustee by a prospective transferor or transferee, the Trustee shall be undera duty to receive and examine the same to determine whether it conforms substantially on itsface to the applicable requirements of this Section 2.6. Notwithstanding the foregoing, theTrustee, relying solely on representations deemed to have been made by Holders of the Class ENotes, Class F Notes and Holders of the Subordinated Notes, shall not permit any transfer ofClass E Notes, Class F Notes or Subordinated Notes if such transfer would result in 25% or moreof the Aggregate Outstanding Amount of the Class E Notes or the Class F Notes being held byBenefit Plan Investors, as calculated pursuant to 29 C.F.R. § 2510.3-101, as modified by Section3(42) of ERISA, or any of the Subordinated Notes being held by Benefit Plan Investors.
For so long as any of the Notes are Outstanding, the Issuer shall not issue(e)or permit the transfer of any shares of the Issuer to U.S. persons and the Co-Issuer shall not issueor permit the transfer of any shares of the Co-Issuer to U.S. persons.
So long as a Global Note remains Outstanding and is held by or on behalf(f)of DTC, transfers of such Global Note, in whole or in part, shall only be made in accordancewith Section 2.2(a) and this Section 2.6(e).
Rule 144A Global Notes or Certificated Notes to Regulation S Global (i)Notes. If a holder of a beneficial interest in a Rule 144A Global Note deposited withDTC or a Holder of a Certificated Note wishes at any time to exchange its interest insuch Rule 144A Global Note or Certificated Note for an interest in the correspondingRegulation S Global Note, or to transfer its interest in such Rule 144A Global Note orCertificated Note to a Person who wishes to take delivery thereof in the form of aninterest in the corresponding Regulation S Global Note, such holder, provided suchholder or, in the case of a transfer, the transferee is not a U.S. person and is acquiringsuch interest in an offshore transaction, may, subject to the immediately succeedingsentence and the rules and procedures of DTC, exchange or transfer, or cause theexchange or transfer of, such interest for an equivalent beneficial interest in thecorresponding Regulation S Global Note. Upon receipt by the Trustee or the Registrar of(A) instructions given in accordance with DTC’s procedures from an Agent Memberdirecting the Trustee or the Registrar to credit or cause to be credited a beneficial interestin the corresponding Regulation S Global Note, but not less than the minimumdenomination applicable to such holder’s Notes, in an amount equal to the beneficialinterest in the Rule 144A Global Note or Certificated Note to be exchanged ortransferred, and in the case of a transfer of Certificated Notes, such Holder’s CertificatedNotes properly endorsed for assignment to the transferee, (B) a written order given inaccordance with DTC’s procedures containing information regarding the participantaccount of DTC and the Euroclear or Clearstream account to be credited with suchincrease, (C) in the case of a transfer of Certificated Notes, a Holder’s Certificated Noteproperly endorsed for assignment to the transferee, (D) a certificate in the form of Exhibit B1 attached hereto given by the holder of such beneficial interest stating that theexchange or transfer of such interest has been made in compliance with the transferrestrictions applicable to the Rule 144A Global Notes or the Certificated Notes includingthat the holder or the transferee, as applicable, is not a U.S. person, and in an offshoretransaction pursuant to and in accordance with Regulation S and (E) a written
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certification in the form of Exhibit B5 attached hereto given by the transferee in respectof such beneficial interest stating, among other things, that such transferee is a non-U.S.person purchasing such beneficial interest in an offshore transaction pursuant toRegulation S, then the Trustee or the Registrar shall approve the instructions at DTC toreduce the principal amount of the Rule 144A Global Note (or, in the case of a transfer ofCertificated Notes, the Trustee or the Registrar shall cancel such Notes) and to increasethe principal amount of the Regulation S Global Note by the aggregate principal amountof the beneficial interest in the Rule 144A Global Note or Certificated Note to beexchanged or transferred, and to credit or cause to be credited to the securities account ofthe Person specified in such instructions a beneficial interest in the correspondingRegulation S Global Note equal to the reduction in the principal amount of the Rule144A Global Note (or, in the case of a cancellation of Certificated Notes, equal to theprincipal amount of Notes so cancelled).
Regulation S Global Notes to Rule 144A Global Notes or Certificated (ii)Notes. If a holder of a beneficial interest in a Regulation S Global Note deposited withDTC wishes at any time to exchange its interest in such Regulation S Global Note for aninterest in the corresponding Rule 144A Global Note or for a Certificated Note or totransfer its interest in such Regulation S Global Note to a Person who wishes to takedelivery thereof in the form of an interest in the corresponding Rule 144A Global Note orfor a Certificated Note, such holder may, subject to the immediately succeeding sentenceand the rules and procedures of Euroclear, Clearstream and/or DTC, as the case may be,exchange or transfer, or cause the exchange or transfer of, such interest for an equivalentbeneficial interest in the corresponding Rule 144A Global Note or for a CertificatedNote. Upon receipt by the Trustee or the Registrar of (A) if the transferee is taking abeneficial interest in a Rule 144A Global Note, instructions from Euroclear, Clearstreamand/or DTC, as the case may be, directing the Registrar to cause to be credited abeneficial interest in the corresponding Rule 144A Global Note in an amount equal to thebeneficial interest in such Regulation S Global Note, but not less than the minimumdenomination applicable to such holder’s Notes to be exchanged or transferred, suchinstructions to contain information regarding the participant account with DTC to becredited with such increase, (B) a certificate in the form of Exhibit B2A attached heretogiven by the holder of such beneficial interest and stating, among other things, that, in thecase of a transfer, either (x) the Person transferring such interest in such Regulation SGlobal Note reasonably believes that the Person acquiring such interest in a Rule 144AGlobal Note is a Qualified Institutional Buyer, is obtaining such beneficial interest in atransaction meeting the requirements of Rule 144A and in accordance with anyapplicable securities laws of any state of the United States or any other jurisdiction, or (y)the Person transferring such interest in such Regulation S Global Note is transferring toan IAI (in the case of a Rated Note) or an Accredited Investor (in the case of aSubordinated Note), in each case, that is not a Qualified Institutional Buyer, in atransaction exempt from registration under the Securities Act and in accordance with anyapplicable securities laws of any state of the United States or any other jurisdiction and(C) a written certification in the form of Exhibit B3 attached hereto given by thetransferee in respect of such beneficial interest stating, among other things, that suchtransferee is a QIB/QP or, in the case of a transfer of Certificated Notes, a writtencertification in the form of Exhibit B4 attached hereto given by the transferee, stating,
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among other things, that such transferee is an IAI/QP (and not a Qualified InstitutionalBuyer) (in the case of Rated Notes only), an AI/QP (and not a Qualified InstitutionalBuyer), (in the case of Subordinated Notes only) or a QIB/QP, then the Registrar shalleither (x) if the transferee is taking a beneficial interest in a Rule 144A Global Note,approve the instructions at DTC to reduce, or cause to be reduced, the Regulation SGlobal Note or Regulation S Global Note by the aggregate principal amount of thebeneficial interest in the Regulation S Global Note to be transferred or exchanged and theRegistrar shall instruct DTC, concurrently with such reduction, to credit or cause to becredited to the securities account of the Person specified in such instructions a beneficialinterest in the corresponding Rule 144A Global Note equal to the reduction in theprincipal amount of the Regulation S Global Note or (y) if the transferee is taking aninterest in a Certificated Note, the Registrar shall record the transfer in the Register inaccordance with Section 2.6(a) and, upon execution by the Applicable Issuers, theTrustee shall authenticate and the Registrar shall deliver one or more Certificated Notes,as applicable, registered in the names specified in the instructions described above, inprincipal amounts designated by the transferee (the aggregate of such principal amountsbeing equal to the aggregate principal amount of the interest in the Regulation S GlobalNote transferred by the transferor), and in Authorized Integrals.
Transfer and Exchange of Certificated Notes to Certificated Notes. If a(iii)holder of a Certificated Note wishes at any time to exchange such Certificated Note forone or more Certificated Notes or transfer such Certificated Note to a transferee whowishes to take delivery thereof in the form of a Certificated Note, such holder may effectsuch exchange or transfer in accordance with this Section 2.6(f)(iii). Upon receipt by theTrustee or the Registrar of (A) a Holder’s Certificated Note properly endorsed forassignment to the transferee, and (B) certificates in the form of Exhibit B4, then theTrustee or the Registrar shall cancel such Certificated Note in accordance with Section 2.10, record the transfer in the Register in accordance with Section 2.6(a) and, uponexecution by the Applicable Issuers, the Trustee shall authenticate and the Registrar shalldeliver one or more Certificated Notes bearing the same designation as the CertificatedNote endorsed for transfer, registered in the names specified in the assignment describedin clause (A) above, in principal amounts designated by the transferee (the aggregate ofsuch principal amounts being equal to the aggregate principal amount of the CertificatedNote surrendered by the transferor), and in Authorized Integrals.
Transfer of Rule 144A Global Notes to Certificated Notes. If a holder of a(iv)beneficial interest in a Rule 144A Global Note deposited with DTC wishes at any time toexchange its interest in such Rule 144A Global Note for a Certificated Note or to transferits interest in such Rule 144A Global Note to a Person who wishes to take deliverythereof in the form of a Certificated Note, such holder may, subject to the immediatelysucceeding sentence and the rules and procedures of DTC, exchange or transfer, or causethe exchange or transfer of, such interest for a Certificated Note. Upon receipt by theTrustee or the Registrar of (A) a certificate substantially in the form of Exhibit B4 and(B) appropriate instructions from DTC, if required, the Trustee or the Registrar shallapprove the instructions at DTC to reduce, or cause to be reduced, the Rule 144A GlobalNote by the aggregate principal amount of the beneficial interest in the Rule 144A GlobalNote to be transferred or exchanged, record the transfer in the Register in accordance
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with Section 2.6(a) and upon execution by the Applicable Issuers authenticate and deliverone or more Certificated Notes, registered in the names specified in the instructionsdescribed in clause (B) above, in principal amounts designated by the transferee (theaggregate of such principal amounts being equal to the aggregate principal amount of theinterest in the Rule 144A Global Note transferred by the transferor), and in AuthorizedIntegrals.
Transfer of Certificated Notes to Rule 144A Global Notes. If a holder of a(v)Certificated Note wishes at any time to exchange its interest in such Certificated Note fora beneficial interest in a Rule 144A Global Note or to transfer such Certificated Note to aPerson who wishes to take delivery thereof in the form of a beneficial interest in a Rule144A Global Note, such holder may, subject to the immediately succeeding sentence andthe rules and procedures of DTC, exchange or transfer, or cause the exchange or transferof, such Certificated Note for beneficial interest in a Rule 144A Global Note (providedthat no IAI or Accredited Investor may hold an interest in a Rule 144A Global Note).Upon receipt by the Trustee or the Registrar of (A) a Holder’s Certificated Note properlyendorsed for assignment to the transferee; (B) a certificate substantially in the form ofExhibit B2B attached hereto executed by the transferor and certificates substantially inthe forms of Exhibit B3 (provided that no such transferor or transferee certificate shall berequired if a holder of a Certificated Note on the Closing Date or the Amendment Date, as applicable, that has provided all required certifications to the Issuer upon acquisitionthereof wishes to exchange a Certificated Note for a Rule 144A Global Note); (C)instructions given in accordance with DTC’s procedures from an Agent Member toinstruct DTC to cause to be credited a beneficial interest in the Rule 144A Global Notesin an amount equal to the Certificated Notes to be transferred or exchanged; and (D) awritten order given in accordance with DTC’s procedures containing informationregarding the participant’s account of DTC to be credited with such increase, the Trusteeor the Registrar shall cancel such Certificated Note in accordance with Section 2.10,record the transfer in the Register in accordance with Section 2.6(a) and approve theinstructions at DTC, concurrently with such cancellation, to credit or cause to be creditedto the securities account of the Person specified in such instructions a beneficial interestin the corresponding Rule 144A Global Note equal to the principal amount of theCertificated Note transferred or exchanged.
Other Exchanges. In the event that a Global Note is exchanged for Notes(vi)in definitive registered form without interest coupons pursuant to Section 2.11, suchGlobal Notes may be exchanged for one another only in accordance with such proceduresas are substantially consistent with the provisions above (including certificationrequirements intended to insure that such transfers are made only to Holders who areQualified Purchasers in transactions exempt from registration under the Securities Act orare to persons who are not U.S. persons who are non-U.S. residents (as determined forpurposes of the Investment Company Act), and otherwise comply with Regulation Sunder the Securities Act, as the case may be), and as may be from time to time adoptedby the Co-Issuers and the Trustee.
[Subordinated Notes to Income Notes. If a Holder of a Subordinated Note(vii)wishes at any time to exchange such Subordinated Note for one or more Income Notes in
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certificated form or for an interest in a Global Income Note (as defined in the IncomeNote Paying Agency Agreement), or transfer such Subordinated Note to a transferee whowishes to take delivery thereof in the form of an Income Note (or an interest therein),such Holder may effect such exchange or transfer in accordance with this Section 2.6(f)(vii). Upon receipt by the Trustee or the Registrar of (A) in the case of the transferof a Certificated Subordinated Note, a Holder’s Subordinated Note properly endorsed forassignment to the transferee, (B) in the case of any exchange or transfer of aSubordinated Note, a certificate substantially in the form attached to the Income NotePaying Agency Agreement given by the transferor of such Subordinated Note or thetransferee of the Income Note, as applicable and (C) in the case of an exchange ortransfer for Global Income Notes, instructions given in accordance with DTC, Euroclearand/or Clearstream’s procedures from an Agent Member to instruct DTC, Euroclearand/or Clearstream to cause to be credited a beneficial interest in the Rule 144A GlobalIncome Note or Regulation S Global Income Note (each as defined in the Income NotePaying Agency Agreement), as applicable, in an amount equal to the Subordinated Notesto be transferred or exchanged (including the participant’s account of DTC, Euroclearand/or Clearstream to be credited with such increase), then the Trustee or Registrar shallapprove the instructions at DTC, Euroclear and/or Clearstream to reduce the principalamount of the Rule 144A Global Subordinated Note or Regulation S GlobalSubordinated Note (in the case of the transfer or exchange of a Global Note) or cancelsuch Subordinated Note in accordance with Section 2.10 (in the case of the transfer orexchange of a Certificated Subordinated Note) and assist the Income Note Issuer withrespect to the issuance of additional Income Notes (including assistance with instructionsto DTC, Euroclear and/or Clearstream, as applicable). Further, the Issuer shall issue aCertificated Subordinated Note (or increase, or instruct the Income Note Issuer toincrease, the principal amount listed on Schedule A of a currently issued CertificatedSubordinated Note that is held by the Income Note Issuer) to the Income Note Issuer inthe amount of Subordinated Notes so transferred or exchanged. Under the Income Note Paying Agency Agreement, Income Notes may not be exchanged by the holders thereof for any Subordinated Notes held by the Income Note Issuer.
Transfer of Certificated Notes. Each transferee acquiring an interest in a (viii)Certificated Note of any Class (or a Junior Mezzanine Note in physical form) will be required to execute and deliver to the Issuer and the Paying Agent a letter in the form of Exhibit B3 attached hereto, which will include an agreement that such transferee will not transfer such interest except in compliance with the transfer restrictions set forth in this Indenture (including the requirement that any subsequent transferee execute and deliver such letter as a condition to any subsequent transfer) and will make representations to ensure that the Issuer is not treated as a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes (unless the Initial Majority Subordinated Noteholder waives the requirement to make such representations).
Transfer of Subordinated Notes. In connection with the transfer of any (ix)Subordinated Notes (or a beneficial interest therein to which a Contribution Repayment Amount is due), each transferor thereof that is a Contributor and is owed a Contribution Repayment Amount will be required to execute and deliver to the Issuer and the Trustee a certificate substantially in the form of Exhibit B4 attached hereto in which it will be
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required to represent and warrant as to the percentage of the aggregate Subordinated Notes and the amount of such Contribution Repayment Amount held by such Person that are in each case subject to such transfer.
If Notes are issued upon the transfer, exchange or replacement of Notes(g)bearing the applicable legends set forth in the applicable part of Exhibit A hereto, and if arequest is made to remove such applicable legend on such Notes, the Notes so issued shall bearsuch applicable legend, or such applicable legend shall not be removed, as the case may be,unless there is delivered to the Trustee and the Applicable Issuers such satisfactory evidence,which may include an Opinion of Counsel acceptable to them, as may be reasonably required bythe Applicable Issuers (and which shall by its terms permit reliance by the Trustee), to the effectthat neither such applicable legend nor the restrictions on transfer set forth therein are required toensure that transfers thereof comply with the provisions of the Securities Act, the InvestmentCompany Act, ERISA or the Code. Upon provision of such satisfactory evidence, the Trustee orits Authenticating Agent, at the written direction of the Applicable Issuers shall, after dueexecution by the Applicable Issuers authenticate and deliver Notes that do not bear suchapplicable legend.
Each Person who becomes a beneficial owner of Notes of a Class(h)represented by an interest in a Global Note shall be deemed to have represented and agreed asfollows:
In connection with the purchase of such Notes: (A) none of the(i)Co-Issuers, the Income Note Issuer, the Collateral Agent, the Loan AgentTrustee, theInvestment Manager, the Placement Agent, the Trustee, the Income Note Issuer, theIncome Note Paying Agent, the Collateral Administrator, the Administrator or any oftheir respective Affiliates is acting as a fiduciary or financial or investment advisor forsuch beneficial owner; (B) such beneficial owner is not relying (for purposes of makingany investment decision or otherwise) upon any advice, counsel or representations(whether written or oral) of the Co-Issuers, the Income Note Issuer, the InvestmentManager, the Trustee, the Collateral Agent, the Loan Agent, the Income Note PayingAgent, the Collateral Administrator, the Administrator, the Placement Agent, or any oftheir respective Affiliates other than any statements in the Offering Circular, and suchbeneficial owner has read and understands the Offering Circular; (C) such beneficialowner has consulted with its own legal, regulatory, tax, business, investment, financialand accounting advisors to the extent it has deemed necessary and has made its owninvestment decisions (including decisions regarding the suitability of any transactionpursuant to this Indenture and Security Agreement) based upon its own judgment andupon any advice from such advisors as it has deemed necessary and not upon any viewexpressed by the Co-Issuers, the Income Note Issuer, the Investment Manager, theTrustee, the Collateral Agent, the Loan Agent, the Income Note Paying Agent, theCollateral Administrator, the Administrator, the Placement Agent, or any of theirrespective Affiliates; (D) such beneficial owner is either (1) in the case of a beneficialowner of an interest in a Rule 144A Global Rated Note both (x) a Qualified InstitutionalBuyer that is not a broker-dealer which owns and invests on a discretionary basis lessthan U.S.$25 million in securities of issuers that are not affiliated persons of the dealerand is not a plan referred to in paragraph (a)(1)(i)(D) or (a)(1)(i)(E) of Rule 144A or a
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trust fund referred to in paragraph (a)(1)(i)(F) of Rule 144A that holds the assets of sucha plan, if investment decisions with respect to the plan are made by beneficiaries of theplan and (y) a Qualified Purchaser (for purposes of Section 3(c)(7) of the InvestmentCompany Act) or an entity owned exclusively by Qualified Purchasers or (2) not a “U.S.person” as defined in Regulation S and is acquiring such Rated Notes in an offshoretransaction (as defined in Regulation S) in reliance on the exemption from registrationprovided by Regulation S; (E) such beneficial owner is acquiring its interest in suchRated Notes for its own account; (F) such beneficial owner was not formed for thepurpose of investing in such Rated Notes (except when each beneficial owner of suchPerson is a Qualified Purchaser); (G) such beneficial owner understands that the Issuer orIncome Note Issuer, as applicable, may receive a list of participants holding interests inthe Rated Notes from one or more book-entry depositories; (H) such beneficial ownerwill hold and transfer at least the minimum denomination of such Rated Notes, (I) suchbeneficial owner has had access to such financial and other information concerning theIssuer and the Notes as it has deemed necessary or appropriate in order to make aninformed investment decision with respect to its purchase of the Notes, including anopportunity to ask questions of and request information from the Issuer and theInvestment Manager and (J) such beneficial owner shall provide notice of the relevanttransfer restrictions to subsequent transferees;
In the case of the Class A Notes, the Class B Notes, the Class C Notes and(ii)the Class D Notes on each day from the date on which such beneficial owner acquires itsinterest in any Rated Notes through and including the date on which such beneficialowner disposes of its interest in such Rated Notes either that (A) it is not, and is notdirectly or indirectly acquiring such Notes (or any interest therein) on behalf of or withassets of, a Benefit Plan Investor, or a governmental, church, non-U.S. or other plan thatis subject to Similar Law or (B) its acquisition, holding and disposition of such Note (orinterest therein) will not constitute or result in a non-exempt prohibited transaction underSection 406 of ERISA or Section 4975 of the Code or a violation of Similar Law.
In the case of the (x) ERISA Restricted Global Notes (other than a(iii)Subordinated Note), except with respect to purchases on the Closing Date or the Amendment Date, as applicable, on each day from the date on which such beneficialowner acquires its interest in such Notes through and including the date on which suchbeneficial owner disposes of its interest in such Notes, that (A) such beneficial owner isnot, and is not directly or indirectly acquiring such Notes (or any interest therein) onbehalf of or with assets of, a Benefit Plan Investor or a Controlling Person and (B) if it isa governmental, church, non-U.S. or other plan that is subject to Similar Law, itsacquisition, holding and disposition of such Notes (or any interest therein) will notconstitute or result in a violation of Similar Law, and (y) Rule 144A Global SubordinatedNotes or Regulation S Global Subordinated Notes, on each day from the date on whichsuch beneficial owner acquires its interest in such Notes through and including the dateon which such beneficial owner disposes of its interest in such Notes, that (A) suchbeneficial owner is not, and is not directly or indirectly acquiring such Notes (or anyinterest therein) on behalf of or with assets of, a Benefit Plan Investor and (B) if it is agovernmental, church, non-U.S. or other plan that is subject to Similar Law, its
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acquisition, holding and disposition of such Notes (or any interest therein) will notconstitute or result in a violation of Similar Law.
Such beneficial owner understands, represents and agrees as provided in(iv)Section 2.15 of this Indenture and Security Agreement.
Such beneficial owner understands that such Notes are being offered only(v)in a transaction not involving any public offering in the United States within the meaningof the Securities Act, such Notes have not been and will not be registered under theSecurities Act or the securities laws of any state or other jurisdiction, and, if in the futuresuch beneficial owner decides to offer, resell, pledge or otherwise transfer such Notes,such Notes may be offered, resold, pledged or otherwise transferred only in accordancewith the provisions of this Indenture and Security Agreement and the legend on suchNotes. Such beneficial owner acknowledges that no representation has been made as tothe availability of any exemption under the Securities Act or any state or other securitieslaws for resale of such Notes. Such beneficial owner understands that none of theCo-Issuers or the pool of Assets has been or will be registered under the InvestmentCompany Act, and that the Co-Issuers are exempt from registration as such by virtue ofSection 3(c)(7) of the Investment Company Act.
It is aware that, except as otherwise provided in this Indenture and (vi)Security Agreement, any Notes being sold to it in reliance on Regulation S will berepresented by one or more Regulation S Global Rated Notes, and that beneficialinterests therein may be held only through DTC for the respective accounts of Euroclearor Clearstream.
It will provide notice to each Person to whom it proposes to transfer any(vii)interest in the Notes of the transfer restrictions and representations set forth in thisSection 2.6, including the Exhibits referenced herein.
It agrees not to seek to commence in respect of the Issuer or the Co-Issuer,(viii)or cause the Issuer or Co-Issuer to commence, a bankruptcy proceeding before a year anda day has elapsed since the payment in full to the holders of the Notes issued pursuant tothis Indenture and Security Agreement or, if longer, the applicable preference period thenin effect.
Such purchaser or transferee understands that the Issuer has the right(ix)under this Indenture and Security Agreement to compel any Non-Permitted Holder, orany beneficial owner of Notes that does not consent to a Re-Pricing with respect to itsNotes pursuant to the applicable terms of this Indenture and Security Agreement, to sellits interest in the Notes or may sell such interest in the Notes on behalf of suchNon-Permitted Holder.
It is not a member of the public in the Cayman Islands.(x)
If such purchaser or transferee holds Securities in the Euroclear System, it(xi)will be deemed to have represented to and agreed with the Issuer and Euroclear Bank as a
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condition to Securities being in the Euroclear System to furnish to the Euroclear Bank (a)its tax identification number, (b) notice of whether it is (i) a person who is not a UnitedStates person, (ii) a foreign government, an international organization or any whollyowned agency or instrumentality of either of the foregoing or (iii) a tax exempt identity,and (c) such other information as the Euroclear Bank may request from time to time inorder to comply with its United States tax reporting obligations. If such purchaser ortransferee, fails to provide such information, Euroclear Bank may, amongst other coursesof action, block trades in the Securities and related income distributions of suchpurchaser or transferee.
Each Person who becomes a beneficial owner of Subordinated Notes(i)represented by a Global Subordinated Note shall be deemed to have made the followingrepresentations and agreements:
In connection with the purchase of such Subordinated Note: (A) none of(i)the Co-Issuers, the Investment Manager, the Placement Agent, the Trustee, the Collateral Agent, the Loan Agent, the Collateral Administrator, the Administrator or any of theirrespective Affiliates is acting as a fiduciary or financial or investment advisor for suchbeneficial owner; (B) such beneficial owner is not relying (for purposes of making anyinvestment decision or otherwise) upon any advice, counsel or representations (whetherwritten or oral) of the Co-Issuers, the Investment Manager, the Trustee, the Collateral Agent, the Loan Agent, the Collateral Administrator, the Administrator, the PlacementAgent, or any of their respective Affiliates other than any statements in the OfferingCircular and such beneficial owner has read and understands the Offering Circular; (C)such beneficial owner has consulted with its own legal, regulatory, tax, business,investment, financial and accounting advisors to the extent it has deemed necessary andhas made its own investment decisions (including decisions regarding the suitability ofany transaction pursuant to this Indenture and Security Agreement) based upon its ownjudgment and upon any advice from such advisors as it has deemed necessary and notupon any view expressed by the Co-Issuers, the Investment Manager, the Trustee, the Collateral Agent, the Loan Agent, the Collateral Administrator, the Administrator, thePlacement Agent, or any of their respective Affiliates; (D) such beneficial owner is not a“U.S. person” as defined in Regulation S and is acquiring the Subordinated Notes in anoffshore transaction in reliance on the exemption from registration provided byRegulation S; (E) such beneficial owner is acquiring its interest in such SubordinatedNotes for its own account; (F) such beneficial owner was not formed for the purpose ofinvesting in such Subordinated Notes (except when each beneficial owner of such Personis a Qualified Purchaser); (G) such beneficial owner understands that the Issuer mayreceive a list of participants holding interests in the Subordinated Notes from one or morebook entry depositories; (H) such beneficial owner shall hold and transfer at least theminimum denomination of such Subordinated Notes; (I) such beneficial owner is asophisticated investor and is purchasing the Subordinated Notes with a full understandingof all of the terms, conditions and risks thereof, and is capable of assuming and willing toassume those risks; (J) such beneficial owner has had access to such financial and otherinformation concerning the Issuer and the Notes as it has deemed necessary orappropriate in order to make an informed investment decision with respect to its purchaseof the Notes, including an opportunity to ask questions of and request information from
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the Issuer and the Investment Manager; and (K) such beneficial owner will providenotice of the relevant transfer restrictions to subsequent transferees.
That on each day from the date on which it acquires its interest in the(ii)Subordinated Notes through and including the date on which it disposes of its interest insuch Subordinated Notes that (1) it is not, and is not directly or indirectly acquiring suchNotes (or any interest therein) on behalf of or with assets of, a Benefit Plan Investor, or(2) if it is a governmental, church, non-U.S. or other plan that is subject to Similar Law,its acquisition, holding and disposition of such Subordinated Notes (or any interesttherein) will not constitute or result in violation of Similar Law.
Such beneficial owner understands, represents and agrees as provided in(iii)Section 2.15 of this Indenture and Security Agreement.
Such beneficial owner understands that such Subordinated Notes are being(iv)offered only in a transaction not involving any public offering in the United States withinthe meaning of the Securities Act, such Subordinated Notes have not been and shall notbe registered under the Securities Act, and, if in the future such beneficial owner decidesto offer, resell, pledge or otherwise transfer such Subordinated Notes, such SubordinatedNotes may be offered, resold, pledged or otherwise transferred only in accordance withthe provisions of this Indenture and Security Agreement and the legend on suchSubordinated Notes. Such beneficial owner acknowledges that no representation hasbeen made as to the availability of any exemption under the Securities Act or any state orother securities laws for resale of the Subordinated Notes. Such beneficial ownerunderstands that neither of the Co-Issuers has been registered under the InvestmentCompany Act, and that the Co-Issuers are exempt from registration as such by virtue ofSection 3(c)(7) of the Investment Company Act.
Such beneficial owner is aware that, except as otherwise provided in this(v)Indenture and Security Agreement, the Subordinated Notes being sold to it will berepresented by one or more Regulation S Global Subordinated Notes and that in eachcase beneficial interests therein may be held only through DTC for the respectiveaccounts of Euroclear or Clearstream.
Such beneficial owner will provide notice to each Person to whom it(vi)proposes to transfer any interest in the Subordinated Notes of the restrictions andrepresentations set forth in this Section 2.6, including the Exhibits referenced herein.
Such beneficial owner agrees not to seek to commence in respect of the(vii)Issuer or the Co-Issuer, or cause the Issuer or Co-Issuer to commence, a bankruptcyproceeding before a year and a day has elapsed since the payment in full to the holders ofthe Notes issued pursuant to this Indenture and Security Agreement or, if longer, theapplicable preference period then in effect.
The Purchaser understands that the Issuer has the right under this(viii)Indenture and Security Agreement to compel any Non-Permitted Holder, or anybeneficial owner of Notes that does not consent to a Re-Pricing with respect to its Notes
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pursuant to the applicable terms of this Indenture and Security Agreement, to sell itsinterest in the Notes or may sell such interest in the Notes on behalf of suchNon-Permitted Holder.
It is not a member of the public in the Cayman Islands.(ix)
If such purchaser or transferee holds Securities in the Euroclear System, it(x)will be deemed to have represented to and agreed with the Issuer and Euroclear Bank as acondition to Securities being in the Euroclear System to furnish to the Euroclear Bank (a)its tax identification number, (b) notice of whether it is (i) a person who is not a UnitedStates person, (ii) a foreign government, an international organization or any whollyowned agency or instrumentality of either of the foregoing or (iii) a tax exempt identity,and (c) such other information as the Euroclear Bank may request from time to time inorder to comply with its United States tax reporting obligations. If such purchaser ortransferee, fails to provide such information, Euroclear Bank may, amongst other coursesof action, block trades in the Securities and related income distributions of suchpurchaser or transferee
Each Person who becomes an owner of Certificated Subordinated Notes(j)shall be required to make the representations and agreements set forth in Exhibit B3 in asubscription agreement or representation letter with the Issuer. Subject to Section 2.2(b)(ii), anIAI who is also a QIB may acquire an interest in a Rule 144A Global Note. No U.S. person mayat any time acquire an interest in a Regulation S Global Note.
Any purported transfer of a Note not in accordance with this Section 2.6(k)shall be null and void and shall not be given effect for any purpose whatsoever.
To the extent required by the Issuer, as determined by the Issuer or the(l)Investment Manager on behalf of the Issuer, the Issuer may, upon written notice to the Trustee,impose additional transfer restrictions on the Subordinated Notes to comply with the Uniting andStrengthening America by Providing Appropriate Tools Required to Intercept and ObstructTerrorism Act of 2001 and other similar laws or regulations, including, without limitation,requiring each transferee of a Subordinated Note to make representations to the Issuer inconnection with such compliance.
Notwithstanding anything to the contrary, the Income Note Issuer may not(m)transfer Subordinated Notes to a transferee that would take possession of Subordinated Notes.
The Trustee and the Issuer shall be entitled to conclusively rely on any(n)transfer certificate delivered pursuant to this Section 2.6 and shall be able to presumeconclusively the continuing accuracy thereof, in each case without further inquiry orinvestigation.
Mutilated, Defaced, Destroyed, Lost or Stolen Note. If (a) anySection 2.7mutilated or defaced Note is surrendered to a Transfer Agent, or if there shall be delivered to theApplicable Issuers, the Trustee and the relevant Transfer Agent evidence to their reasonablesatisfaction of the destruction, loss or theft of any Note, and (b) there is delivered to the
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Applicable Issuers, the Trustee and such Transfer Agent, and any agent of the ApplicableIssuers, the Trustee and such Transfer Agent, such security or indemnity as may be reasonablyrequired by them to save each of them harmless, then, in the absence of notice to the ApplicableIssuers, the Trustee or such Transfer Agent that such Note has been acquired by a ProtectedPurchaser, the Applicable Issuers shall execute and, upon Issuer Order, the Trustee shallauthenticate and deliver, in lieu of any such mutilated, defaced, destroyed, lost or stolen Note, anew Note, of like tenor (including the same date of issuance) and equal principal or face amount,registered in the same manner, dated the date of its authentication, bearing interest from the dateto which interest has been paid on the mutilated, defaced, destroyed, lost or stolen Note andbearing a number not contemporaneously outstanding.
If, after delivery of such new Note, a Protected Purchaser of the predecessor Notepresents for payment, transfer or exchange such predecessor Note, the Applicable Issuers, theTransfer Agent and the Trustee shall be entitled to recover such new Note from the Person towhom it was delivered or any Person taking therefrom, and shall be entitled to recover upon thesecurity or indemnity provided therefor to the extent of any loss, damage, cost or expenseincurred by the Applicable Issuers, the Trustee and the Transfer Agent in connection therewith.
In case any such mutilated, defaced, destroyed, lost or stolen Note has becomedue and payable, the Applicable Issuers in their discretion may, instead of issuing a new Notepay such Note without requiring surrender thereof except that any mutilated or defaced Noteshall be surrendered.
Upon the issuance of any new Note under this Section 2.7, the Applicable Issuers,the Trustee or the applicable Transfer Agent may require the payment by the Holder thereof of asum sufficient to cover any tax or other governmental charge that may be imposed in relationthereto and any other expenses (including the fees and expenses of the Trustee) connectedtherewith.
Every new Note issued pursuant to this Section 2.7 in lieu of any mutilated,defaced, destroyed, lost or stolen Note shall constitute an original additional contractualobligation of the Applicable Issuers and such new Note shall be entitled, subject to the secondparagraph of this Section 2.7, to all the benefits of this Indenture and Security Agreementequally and proportionately with any and all other Notes of the same Class duly issuedhereunder.
The provisions of this Section 2.7 are exclusive and shall preclude (to the extentlawful) all other rights and remedies with respect to the replacement or payment of mutilated,defaced, destroyed, lost or stolen Notes.
Payment of Principal and Interest and Other Amounts; Principal Section 2.8and Interest Rights Preserved. (a) The Rated DebtNotes of each Class shall accrue interestduring each Interest Accrual Period at the applicable DebtNote Interest Rate and such interestshall be payable in arrears on each Payment Date in the case of the Rated DebtNotes, on theAggregate Outstanding Amount thereof on the first day of the related Interest Accrual Period(after giving effect to payments of principal thereof on such date). Payment of interest on eachClass of Rated DebtNotes (and payments of Interest Proceeds to the Holders of the Subordinated
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Notes) shall be subordinated to the payments of interest on the related Priority Classes. So longas any Priority Classes are Outstanding with respect to any Class of Deferred Interest Notes, anypayment of interest due on such Class of Deferred Interest Notes which is not available to bepaid in accordance with the Priority of Payments on any Payment Date (“Deferred Interest” withrespect thereto), shall not be considered “due and payable” for the purposes of Section 5.1(a)(and the failure to pay such interest shall not be an Event of Default) until the earliest of thePayment Date (i) on which such interest is available to be paid in accordance with the Priority ofPayments, (ii) which is a Redemption Date with respect to such Class of Deferred Interest Notes,and (iii) which is the Stated Maturity of such Class of Deferred Interest Notes. Deferred Intereston any Class of Deferred Interest Notes shall not be added to the principal balance of such Class.Deferred Interest shall be payable on the first Payment Date on which funds are available to beused for such purpose in accordance with the Priority of Payments, but in any event no later thanthe earlier of the Payment Date (i) which is the Redemption Date with respect to such Class ofDeferred Interest Notes, and (ii) which is the Stated Maturity of such Class of Deferred InterestNotes. Interest shall cease to accrue on the Rated DebtNotes, or in the case of a partialrepayment, on such part, from the date of repayment or the respective Stated Maturity unlesspayment of principal is improperly withheld or unless default is otherwise made with respect tosuch payments of principal. To the extent lawful and enforceable, (x) interest on DeferredInterest with respect to any Class of Deferred Interest Notes shall accrue at the DebtNote InterestRate for such Class until paid as provided herein and (y) interest on the interest on any Class X Note, Class A ObligationNote or any Class B Note or, if no Class X Notes, Class AObligationsNotes or Class B Notes are Outstanding, any Class C Note, or, if no Class X Notes, Class A ObligationsNotes, Class B Notes or Class C Notes are Outstanding, any Class D Note,or, if no Class X Notes, Class A ObligationsNotes, Class B Notes, Class C Notes or Class DNotes are Outstanding, any Class E Note, or, if no Class X Notes, Class A ObligationsNotes,Class B Notes, Class C Notes, Class D Notes or Class E Notes are Outstanding, any Class F Notethat is not paid when due shall accrue at the DebtNote Interest Rate for such Class until paid asprovided herein.
The principal of each Rated DebtNotes of each Class matures at par and is(b)due and payable on the Payment Date which is the Stated Maturity for such Class of RatedNotes, unless the unpaid principal of such Rated DebtNotes becomes due and payable at anearlier date by declaration of acceleration, call for redemption or otherwise. Notwithstanding theforegoing, the payment of principal of each Class of Rated DebtNotes (and payments ofPrincipal Proceeds to the Holders of the Subordinated Notes) may only occur (other thanamounts constituting Deferred Interest thereon which shall be payable from Interest Proceedspursuant to Section 11.1(i)) after principal and interest on each Class of DebtNotes thatconstitutes a Priority Class with respect to such Class has been paid in full and is subordinated tothe payment on each Payment Date of the principal and interest due and payable on such PriorityClass(es), and other amounts in accordance with the Priority of Payments, and any payment ofprincipal of any Class of Rated DebtNotes which is not paid, in accordance with the Priority ofPayments, on any Payment Date (other than the Payment Date which is the Stated Maturity ofsuch Class or any Redemption Date), shall not be considered “due and payable” for purposes ofSection 5.1(a) until the Payment Date on which such principal may be paid in accordance withthe Priority of Payments or all of the Priority Classes with respect to such Class have been paidin full.
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Principal payments on the DebtNotes shall be made in accordance with the(c)Priority of Payments and Section 9.1.
As a condition to the payment of principal of and interest on any Rated(d)DebtNotes or any payment on any Subordinated Note without the imposition of withholding orbackup withholding tax, the Trustee, the Collateral Agent, the Income Note Paying Agent shallrequire certification acceptable to it to enable the Issuer, the Co-Issuer, the Trustee, the Collateral Agent and the Income Note Paying Agent to determine their duties and liabilities withrespect to any taxes or other charges that they may be required to deduct or withhold frompayments in respect of such DebtNotes under any present or future law or regulation of theUnited States and any other applicable jurisdiction, or any present or future law or regulation ofany political subdivision thereof or taxing authority therein or to comply with any reporting orother requirements under any such law or regulation.
Payments in respect of interest on and principal of any Rated DebtNotes(e)and any payment with respect to any Subordinated Note shall be made by the Collateral Agent, the Loan AgentTrustee or by the Income Note Paying Agent in United States dollars to DTC orits designee with respect to a Global Note, to the Holder or its nominee with respect to aCertificated Note, and to the Class A Lender or its nominee with respect to the Class A Loan by wire transfer, as directed by the Holder, in immediately available funds to a United States dollaraccount, as the case may be, maintained by DTC or its nominee with respect to a Global Note, tothe Holder or its designee with respect to a Certificated Note or by the Class A Lender or its designee with respect to the Class A Loans, provided that in the case of a Certificated Note and the Class A Loans, the Holder thereof shall have provided written wiring instructions to theCollateral AgentTrustee or the Income Note Paying Agent, on or before the related Record Date;provided, further, that if appropriate instructions for any such wire transfer are not received bythe related Record Date, then such payment shall be made by check drawn on a U.S. bank mailedto the address of the Holder specified in the Register or in the Credit Agreement, as applicable.Upon final payment due on the Maturity of a Note, the Holder thereof shall present andsurrender such Note at the Corporate Office of the Collateral AgentTrustee on or prior to suchMaturity; provided that if the Collateral AgentTrustee and the Applicable Issuers shall have beenfurnished such security or indemnity as may be required by them to save each of them harmlessand an undertaking thereafter to surrender such certificate, then, in the absence of notice to theApplicable Issuers or the Collateral AgentTrustee that the applicable Note has been acquired bya bona fide purchaser, such final payment shall be made without presentation or surrender.Neither the Co-Issuers, the Trustee, the Collateral Agent, the Loan Agent, the InvestmentManager, nor the Income Note Paying Agent shall have any responsibility or liability for anyaspects of the records maintained by DTC, Euroclear, Clearstream or any of the Agent Membersrelating to or for payments made thereby on account of beneficial interests in a Global Note. Inthe case where any final payment of principal and interest is to be made on any Rated DebtNotes(other than on the Stated Maturity thereof) or any final payment is to be made on anySubordinated Note (other than on the Stated Maturity thereof), the Trustee, in the name and atthe expense of the Applicable Issuers shall, not more than 30 nor less than 10 days prior to thedate on which such payment is to be made, mail (by first class mail, postage prepaid) to thePersons entitled thereto at their addresses appearing on the Register or the Credit Agreement, as applicable, a notice which shall specify the date on which such payment shall be made, the
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amount of such payment per U.S.$100,000 original principal amount of Rated DebtNotes,original principal amount of Subordinated Notes, and the place where the Notes may bepresented and surrendered for such payment.
Payments of principal to Holders of the Rated DebtNotes of each Class(f)shall be made in the proportion that the Aggregate Outstanding Amount of the DebtNotes ofsuch Class registered in the name of each such Holder on the applicable Record Date bears to theAggregate Outstanding Amount of all DebtNotes of such Class on such Record Date. Paymentsto the Holders of the Subordinated Notes from Interest Proceeds and Principal Proceeds shall bemade in the proportion that the Aggregate Outstanding Amount of the Subordinated Notesregistered in the name of each such Holder on the applicable Record Date bears to the AggregateOutstanding Amount of all Subordinated Notes on such Record Date.
Interest accrued with respect to the Rated DebtNotes shall be calculated(g)on the basis of the actual number of days elapsed in the applicable Interest Accrual Perioddivided by 360.
All reductions in the principal amount of a Note (or one or more(h)predecessor Notes) effected by payments of installments of principal made on any Payment Dateor Redemption Date shall be binding upon all future Holders of such Note and of any Noteissued upon the registration of transfer thereof or in exchange therefor or in lieu thereof, whetheror not such payment is noted on such Note.
Notwithstanding any other provision of this Indenture and Security (i)Agreement, the obligations of the Issuer and Co-Issuer under the DebtNotes and this Indenture and Security Agreement are limited recourse or non-recourse obligations of the Issuer andCo-Issuer, as applicable, payable solely from the Assets and following realization of the Assets,and application of the proceeds thereof in accordance with this Indenture and Security Agreement, all obligations of and any claims against the Co-Issuers hereunder or in connectionherewith after such realization shall be extinguished and shall not thereafter revive. No recourseshall be had against any Officer, director, employee, member, manager, partner, shareholder orincorporator of either the Co-Issuers, the Investment Manager or their respective successors orassigns for any amounts payable under the DebtNotes or (except as otherwise provided herein orin the Investment Management Agreement) this Indenture and Security Agreement. It isunderstood that the foregoing provisions of this paragraph (i) shall not (x) prevent recourse to theAssets for the sums due or to become due under any security, instrument or agreement which ispart of the Assets or (y) constitute a waiver, release or discharge of any indebtedness orobligation evidenced by the DebtNotes or secured by this Indenture and Security Agreementuntil such Assets have been realized. It is further understood that the foregoing provisions ofthis paragraph (i) shall not limit the right of any Person to name the Issuer or the Co-Issuer as aparty defendant in any Proceeding or in the exercise of any other remedy under the DebtNotes orthis Indenture and Security Agreement, so long as no judgment in the nature of a deficiencyjudgment or seeking personal liability shall be asked for or (if obtained) enforced against anysuch Person or entity. The Subordinated Notes are not secured hereunder.
Subject to the foregoing provisions of this Section 2.8, each Note(j)delivered under this Indenture and Security Agreement and upon registration of transfer of or in
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exchange for or in lieu of any other Note shall carry the rights of unpaid interest and principal (orother applicable amount) that were carried by such other Note.
Persons Deemed Owners. The Issuer, the Co-Issuer, the Trustee, Section 2.9the Collateral Agent and any agent of the Co-Issuers, the Collateral AgentTrustee or the Trusteeshall treat as the owner of a Note the Person in whose name such Note is registered on theRegister and shall treat the Class A Lender as the owner of the Class A Loans on the applicableRecord Date for the purpose of receiving payments of principal of and interest on suchDebtNotes and on any other date for all other purposes whatsoever (whether or not such Debt isNotes are overdue), and neither the Issuer, the Co-Issuers nor the Trustee nor any agent of theIssuer, the Co-Issuers or the Trustee shall be affected by notice to the contrary.
Surrender of Notes; Cancellation. (a) Notwithstanding anythingSection 2.10herein to the contrary, no Note may be surrendered (including any surrender in connection withany abandonment) for any purpose other than payment as described herein, registration oftransfer, exchange or redemption in accordance with Article IX, or for replacement in connectionwith any Note that is deemed lost or stolen. The Issuer may not acquire any Notes (includingany Notes that are surrendered, cancelled or abandoned) except pursuant to Section 2.16. Thepreceding sentence shall not limit an optional or mandatory redemption of the Notes pursuant tothe terms of this Indenture and Security Agreement.
All Notes that are surrendered for payment, registration of transfer,(b)exchange or redemption, or deemed lost or stolen, shall be promptly cancelled by the Trusteeand may not be reissued or resold; provided that, in the event an anticipated OptionalRedemption does not occur, Notes that are delivered in connection with such anticipatedOptional Redemption shall be returned by the Trustee to the Person surrendering the same. Anysuch Notes shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee.No Notes shall be authenticated in lieu of or in exchange for any Notes canceled as provided inthis Section 2.10, except as expressly permitted by this Indenture and Security Agreement. Allcanceled Notes held by the Trustee shall be destroyed by the Trustee in accordance with itsstandard policy, unless the Co-Issuers shall direct by an Issuer Order received prior todestruction that they be returned to it.
Certificated Notes. (a) A Global Note deposited with DTCSection 2.11pursuant to Section 2.2 shall be transferred in the form of a corresponding Certificated Note tothe beneficial owners thereof only if such transfer complies with Section 2.6 and either (i) DTCnotifies the Co-Issuers that it is unwilling or unable to continue as depository for such GlobalNote or (ii) at any time DTC ceases to be a Clearing Agency registered under the Exchange Actand, in each case, a successor depository is not appointed by the Co-Issuers within 90 days aftersuch notice. In addition, the owner of a beneficial interest in a Global Note shall be entitled toreceive a corresponding Certificated Note in exchange for such interest if an Event of Defaulthas occurred and is continuing.
Any Global Note that is transferable in the form of a Certificated Note to(b)the beneficial owners thereof pursuant to this Section 2.11 shall be surrendered by DTC to theTrustee’s designated office located in the United States to be so transferred, in whole or fromtime to time in part, without charge, and the Applicable Issuers shall execute and the Trustee
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shall authenticate and deliver, upon such transfer of each portion of such Global Note, an equalaggregate principal amount of definitive physical certificates (pursuant to the instructions ofDTC) in Authorized Integrals. Any Certificated Note delivered in exchange for an interest in aGlobal Note shall, except as otherwise provided by Section 2.6(g) and (h), bear the legends setforth in the applicable Exhibit A and shall be subject to the transfer restrictions referred to insuch legends.
Subject to the provisions of paragraph (b) of this Section 2.11, the Holder(c)of a Global Note may grant proxies and otherwise authorize any Person, including AgentMembers and Persons that may hold interests through Agent Members, to take any action whicha Holder is entitled to take under this Indenture and Security Agreement or the Notes.
In the event of the occurrence of either of the events specified in(d)subclauses (i) and (ii) of subsection (a) of this Section 2.11, the Co-Issuers shall promptly makeavailable to the Trustee a reasonable supply of Certificated Notes in definitive, fully registeredform without interest coupons.
The Certificated Notes shall be in substantially the same form as thecorresponding Global Notes with such changes therein as the Issuer and Trustee shall agree. Inthe event that Certificated Notes are not so issued by the Issuer to such beneficial owners ofinterests in Global Notes as required by Section 2.11(a), the Issuer expressly acknowledges thatthe beneficial owners shall be entitled to pursue any remedy that the Holder of a Global Notewould be entitled to pursue in accordance with Article V of this Indenture and Security Agreement (but only to the extent of such beneficial owner’s interest in the Global Note) as ifCertificated Notes had been issued. Neither the Trustee nor the Registrar shall be liable for anydelay in the delivery of directions from the Depository and may conclusively rely on, and shallbe fully protected in relying on, such direction as to the names of beneficial owners in whosenames such Certificated Notes shall be registered or as to delivery instructions for suchCertificated Notes.
Notes Beneficially Owned by Persons Not QIB/QPs, IAI/QPs or Section 2.12AI/QPs or in Violation of ERISA Representations. (a) Notwithstanding anything to the contraryelsewhere in this Indenture and Security Agreement, any transfer of (x) a beneficial interest inany Note to a U.S. person that is not (i) in the case of a Rule 144A Global Note, a QIB/QP (ii) inthe case of a Certificated Rated Note, an IAI/QP or a QIB/QP, or (y) in the case of a CertificatedSubordinated Note, a QIB/QP or an AI/QP, and, in each case that is not made pursuant to anapplicable exemption under the Securities Act and the Investment Company Act shall be nulland void and any such purported transfer of which the Issuer, the Co-Issuer or the Trustee shallhave notice may be disregarded by the Issuer, the Co-Issuer and the Trustee for all purposes.
If (w) any U.S. person that is not a QIB/QP (in the case of a Rule 144A(b)Global Rated Note) or an IAI/QP or QIB/QP (in the case of a Certificated Rated Note) shallbecome the beneficial owner of an interest in any Rated Note, (x) any U.S. person that is not anAI/QP becomes the Holder or beneficial owner of an interest in any Subordinated Note, (y) anyNon-Permitted ERISA Holder or (z) any Holder that fails to provide the Issuer, the Income NoteIssuer or their agent, or whose direct or indirect acquisition or holding of an interest in theDebtNotes, in the reasonable determination of the Issuer or the Income Note Issuer, as
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applicable, would cause the Issuer or the Income Note Issuer to be unable to achieve FATCACompliance (any such person a “Non-Permitted Holder”), the Issuer shall, promptly afterdiscovery that such person is a Non-Permitted Holder by the Issuer, the Co-Issuer, the Collateral AgentTrustee or the Trustee (and notice to the Issuer by the Trustee or Collateral AgentTrustee ifa Bank Officer of the Trustee or Collateral AgentTrustee, as applicable, obtains actualknowledge or by the Co-Issuer if it makes the discovery), send notice to such Non-PermittedHolder demanding that such Non-Permitted Holder transfer its interest in the Notes held by suchperson to a Person that is not a Non-Permitted Holder within 30 days (or in the case of aNon-Permitted ERISA Holder, 10 days) of the date of such notice. If such Non-PermittedHolder fails to so transfer such Notes, the Issuer shall have the right, without further notice to theNon-Permitted Holder, to sell such Notes or interest in such Notes to a purchaser selected by theIssuer that is a not a Non-Permitted Holder on such terms as the Issuer may choose. The Issuer,or the Investment Manager (on its own or acting through an investment bank selected by theInvestment Manager at the Issuer’s expense) acting on behalf of the Issuer, may select thepurchaser by soliciting one or more bids from one or more brokers or other market professionalsthat regularly deal in securities similar to the Notes, and selling such Notes to the highest suchbidder. However, the Issuer may select a purchaser by any other means determined by it in itssole discretion. The Holder of each Note, the Non-Permitted Holder and each other Person inthe chain of title from the Holder to the Non-Permitted Holder, by its acceptance of an interest inthe Notes, agrees to cooperate with the Issuer, the Investment Manager and the Trustee to effectsuch transfers. The proceeds of such sale, net of any commissions, expenses and taxes due inconnection with such sale shall be remitted to the Non-Permitted Holder. The terms andconditions of any sale under this subsection shall be determined in the sole discretion of theIssuer, and the Issuer shall not be liable to any Person having an interest in the Notes sold as aresult of any such sale or the exercise of such discretion.
Notwithstanding anything to the contrary elsewhere in this Indenture and (c)Security Agreement, any transfer of a beneficial interest in any Note to a Person who has madeor is deemed to have made an ERISA-related representation required by Section 2.6 that issubsequently shown to be false or misleading shall be null and void and any such purportedtransfer of which the Issuer, the Co-Issuer or the Trustee shall have notice may be disregarded bythe Issuer, the Co-Issuer and the Trustee for all purposes.
Deduction or Withholding from Payments on DebtNotes; No Gross Section 2.13Up. If the Issuer is required to deduct or withhold tax from, or with respect to, payments (orallocations) to any Holder of the DebtNotes for any Tax, then the Trustee, the Collateral Agentor the Income Note Paying Agent, as applicable, shall deduct, or withhold, the amount requiredto be deducted or withheld and remit to the relevant authority such amount. Without limiting thegenerality of the foregoing, the Issuer may withhold any amount that it determines is required tobe withheld from any amounts otherwise distributable to any holder of DebtNotes. The Issuershall not be obligated to pay any additional amounts to the Holders or beneficial owners of theDebtNotes as a result of any withholding or deduction for, or on account of, any Tax imposed onpayments in respect of the DebtNotes. The amount of any withholding tax or deduction withrespect to any Holder shall be treated as cash distributed to such Holder at the time it is withheldor deducted by the Trustee or the Income Note Paying Agent and remitted to the appropriatetaxing authority.
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Conversion of Class A Loans to Class A-1 Notes. Upon written Section 2.14notice from a Converting Lender to the Trustee, the Loan Agent, the Investment Manager, the Collateral Agent and the Co-Issuers, the Converting Lender may elect a Business Day (any such Business Day, a “Conversion Date”) to convert all or a portion of the Aggregate Outstanding Amount of the Class A Loans held by the Converting Lender into Class A-1 Notes of like amount upon delivery to the Collateral Agent, the Trustee, the Loan Agent and the Co-Issuers of a notice substantially in the form of Exhibit C to the Credit Agreement; provided that the Conversion Date shall be no earlier than the fifth Business Day following the date such notice is delivered (or such earlier date as may be reasonably agreed to by the Lender, the Collateral Agent, the Loan Agent and the Trustee) and may not be between a Record Date and a Payment Date. On a Conversion Date, the Aggregate Outstanding Amount of the Class A-1 Notes shall be increased by the Aggregate Outstanding Amount of the Class A Loans so converted and such Class A Loans shall cease to be Outstanding and shall be deemed to have been repaid in full for all purposes under this Indenture and Security Agreement and under the Credit Agreement. Subject to clause (c) below, interest accrued on the converted Class A Loans since the prior Payment Date (or the Closing Date, if no Payment Date has occurred) shall, as of the Conversion Date, be deemed to have been Outstanding on the Class A-1 Notes since such prior Payment Date (or the Closing Date, if no Payment Date has occurred) and interest on the converted Class A Loans shall thereafter accrue at the Debt Interest Rate applicable to the Class A-1 Notes.No Class A-1 Notes may be converted into Class A Loans.[Reserved]
(b) The Converting Lender agrees to provide reasonable assistance to the Trustee, the Collateral Agent and the Loan Agent in connection with such conversion, including, but not limited to, providing instructions to DTC.
(c) Notwithstanding anything herein to the contrary, if the Conversion Option is exercised during an Interest Accrual Period during which the Class A Loan has been assigned, the Loan Agent shall instruct the Collateral Agent to pay to the assignor Lender the interest that would otherwise have been payable to the assignor Lender on such Payment Date pursuant to Section 3.4.1(f) of the Credit Agreement as if the Conversion Option had not been exercised.
Tax Certifications. (a) Each Holder (including, for purposes of thisSection 2.15Section 2.15, any beneficial owner of Notes) will treat the Issuer, the Co-Issuer, the Income NoteIssuer and the Notes as described in the “Certain U.S. Federal Income Tax Considerations”section of the Offering Circular for all U.S. federal, state and local income tax purposes and willtake no action inconsistent with such treatment unless required by law.
Each Holder will timely furnish the Issuer, the Income Note Issuer, and(b)their agents with any documentation and information (such as IRS Form W-9 (Request forTaxpayer Identification Number and Certification), IRS Form W-8BEN (Certificate of ForeignStatus of Beneficial Owner for United States Tax Withholding), IRS Form W-8BEN-E(Certificate of Status of Beneficial Owner for United States Withholding and Reporting(Entities)), IRS Form W-8IMY (Certificate of Foreign Intermediary, Foreign Flow ThroughEntity, or Certain U.S. Branches for United States Tax Withholding), IRS Form W-8ECI(Certificate of Foreign Person’s Claim That Income Is Effectively Connected With the Conductof a Trade or Business in the United States), or any successors to such IRS forms) that the Issuer,
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the Income Note Issuer, or their agents may reasonably request (A) to permit the Issuer, theIncome Note Issuer, or their agents to make payments to it without, or at a reduced rate of,deduction or withholding, (B) to enable the Issuer, the Income Note Issuer, or their agents toqualify for a reduced rate of withholding or deduction in any jurisdiction from or through whichthey receive payments, and (C) to enable the Issuer, the Income Note Issuer, or their agents tosatisfy reporting and other obligations under the Code and Treasury regulations or under any other applicable law, including, without limitation, the Cayman FATCA Legislation, and shallupdate or replace such documentation and information in accordance with its terms orsubsequent amendments, and acknowledges that the failure to provide, update or replace anysuch documentation or information may result in the imposition of withholding or back upwithholding upon payments to such holder. Amounts withheld pursuant to applicable tax lawswill be treated as having been paid to the holder.
Each Holder will provide the Issuer, the Income Note Issuer, and their(c)agents with the Holder FATCA Information and will take any other actions, that may be requiredfor the Issuer and the Income Note Issuer to achieve FATCA Compliance, and, in the event suchholder fails to provide such information or take such actions or in the event that such Holder’sownership of any Notes would otherwise cause the Issuer to be subject to withholding tax underFATCA, (A) the Issuer and Income Note Issuer are authorized to withhold amounts otherwisedistributable to such Holder as compensation for any amount withheld from payments to theIssuer as a result of such failure or such Holder’s ownership of Notes, and (B) to the extentnecessary to avoid an adverse effect on the Issuer or any other Holder of Notes as a result ofsuch failure or such Holder’s ownership of Notes, the Issuer and the Income Note Issuer willhave the right to compel such Holder to sell its Notes, and, if such Holder does not sell its Noteswithin 10 Business Days after notice from the Issuer, the Income Note Issuer, or an agentthereof, to sell such Notes at a public or private sale called and conducted in any mannerpermitted by law, and to remit the net proceeds of such sale (taking into account any taxesincurred by the Issuer or the Income Note Issuer in connection with such sale) to such Holder aspayment in full for such Notes. The Issuer and the Income Note Issuer may also assign eachsuch Note a separate CUSIP number in the Issuer’s or the Income Note Issuer’s sole discretion.
Each Holder of Class E Notes, Class F Notes or Subordinated Notes (other(d)than the Income Note Issuer) represents, acknowledges and agrees that:
If it is not a “United States person” (as defined in Section 7701(a)(30) of(i)the Code), it is not purchasing the Note in order to reduce its U.S. federal income taxliability pursuant to a tax avoidance plan and either:
is not a bank (within the meaning of Section 881(c)(3)(A) of the(A)Code),(B) has provided an IRS Form W-8ECI representing that all payments received or to be received by it from the Issuer are effectively connected with its conduct of a trade or business in the United States and includible in its gross income, or
(C) is eligible for benefits under an income tax treaty with the(B)United States that eliminates U.S. federal income taxation of U.S.-source interestnot attributable to a permanent establishment in the United States.
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It will not (1) acquire or directly or indirectly sell, encumber, assign,(ii)participate, pledge, hypothecate, rehypothecate, exchange, or otherwise dispose of, sufferthe creation of a lien on, or transfer or convey in any manner (each, a “Transfer”) suchNotes (or any interest therein that is described in Treasury regulations section1.7704-1(a)(2)(i)(B)) on or through (x) a United States national, regional or localsecurities exchange, (y) a foreign securities exchange or (z) an interdealer quotationsystem that regularly disseminates firm buy or sell quotations by identified brokers ordealers ((x), (y) and (z), collectively, an “Exchange”) or (2) cause any of such Notes orany interest therein to be marketed on or through an Exchange.
It will not enter into any financial instrument payments on which are, or(iii)the value of which is, determined in whole or in part by reference to such Notes or theIssuer (including the amount of Issuer distributions on such Notes, the value of theIssuer’s assets, or the result of the Issuer’s operations), or any contract that otherwise isdescribed in Treasury regulations section 1.7704-1(a)(2)(i)(B).
If it is, for U.S. federal income tax purposes, a partnership, grantor trust or(iv)S corporation, then less than 50% of the value of any person’s interest in it will beattributable to such Notes, unless the Issuer has otherwise determined that such Holderwill not cause the Issuer to be unable to rely on the “private placement” safe harbor ofTreasury regulations Section 1.7704-1(h).
It will not Transfer all or any portion of such Notes unless: (1) the person(v)to which it Transfers such Notes agrees to be bound by the restrictions, conditions,representations, warrants, and covenants set forth in this Section 2.15(d), and (2) suchTransfer does not violate this Section 2.15(d).
If it is not a “United States person” (as defined in Section 7701(a)(30) of (vi)the Code), it will not (i) treat its income in respect of such Notes as effectively connected with the conduct of a trade or business in the United States for U.S. federal income tax purposes, or (ii) provide to the Issuer or its agents an IRS Form W-8ECI (or successor form) or an IRS Form W-8IMY (or successor form) to which an IRS Form W-8ECI (or successor form) is attached.
Any Transfer made in violation of this Section 2.15(d), or that otherwise would cause the Issuerto be treated as a disregarded entity for U.S. federal income tax purposes or unable to rely on the“private placement” safe harbor of Treasury regulations section 1.7704-1(h), will be void and ofno force or effect, and will not bind or be recognized by the Issuer or any other person, and noperson to which such Notes are Transferred shall become a Holder unless such person agrees tobe bound by this Section 2.15(d). However, notwithstanding the immediately precedingsentence, a Transfer in violation of Sections 2.15(d)(ii), (iii), (iv) or (v) shall be permitted if theCollateral AgentTrustee receives written advice of White & CaseCadwalader, Wickersham & Taft LLP, Ashurst LLP or, Winston and Strawn LLP, or a written opinion of anotherothernationally recognized tax counsel experienced in such matters, to the effect that the Transfer willnot cause the Issuer to be treated as a “publicly traded partnership” taxable as a corporation forU.S. federal income tax purposes.
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Each Holder of Subordinated Notes acknowledges and agrees that:(e)
It shall not Transfer Subordinated Notes (or any interest therein) to(A)any Person if such Transfer would cause such Person to beneficially own morethan 98.00% of the Subordinated Notes.
It shall not acquire Subordinated Notes (or any interest therein) if(B)such acquisition would cause it or any other Person to beneficially own more than98.00% of the Subordinated Notes.
Each holder of Class E Notes, Class F Notes or Subordinated Notes (other thanthe Income Note Issuer) acknowledges and agrees that:
it is not (at any time that it holds the Class E Notes, Class F Notes(C)or Subordinated Notes), and will provide the Issuer with certifications necessaryto establish that it is not, subject to U.S. federal withholding tax under FATCA.
it represents that, if it is not a “United States person” (as defined in(D)Section 7701(a)(30) of the Code), it will not:
treat its income in respect of such Notes as effectively(1)connected with the conduct of a trade or business in the United States forU.S. federal income tax purposes, or
provide to the Issuer or its agents an IRS Form W-8ECI (or(2)successor form) or an IRS Form W-8IMY (or successor form) to which anIRS Form W-8ECI (or successor form) is attached.
Any Transfer or acquisition of a Note (or any interest therein) in violation ofprovisions (A) through (D) above shall be ineffective and void and shall not bind or berecognized by the Issuer or any other Person.
If it is a Holder of Income Notes and is not a “United States person” (as(f)defined in Section 7701(a)(30) of the Code), it represents, acknowledges, and agrees that it is notpurchasing the Note in order to reduce its U.S. federal income tax liability pursuant to a taxavoidance plan and either.
is not a bank (within the meaning of Section 881(c)(3)(A) of the(A)Code); or
has provided an IRS Form W-8ECI representing that all payments (B)received or to be received by it from the Income Note Issuer are effectively connected with its conduct of a trade or business in the United States and includible in its gross income.is eligible for benefits under an income tax treaty with the United States that eliminates U.S. federal income taxation of U.S.-source interest not attributable to a permanent establishment in the United States.
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If it is a holder of Income Notes, it agrees not to treat any income(g)generated by its Income Notes as derived in connection with the Issuer’s or the Income NoteIssuer’s active conduct of a banking, financing, insurance, or other similar business for purposesof Section 954(h)(2) of the Code
With respect to any period during which any Holder owns more than 50%(h)of the Subordinated Notes or the Income Notes, by value, or is otherwise treated as a member ofthe Issuer’s or Income Note Issuer’s “expanded affiliated group” (as defined in Treasuryregulations section 1.1471-5(i)), such Holder covenants that any member of such expandedaffiliated group (other than the Issuer, the Income Note Issuer, and any Issuer Subsidiary) that istreated as a “foreign financial institution” within the meaning of Section 1471(d)(4) of Code andany Treasury regulations promulgated thereunder will be either a “participating FFI” or a“registered deemed-compliant FFI” within the meaning of Treasury regulations section1.1471-4(e), except to the extent that the Issuer, the Income Note Issuer or their respectiveagents have provided such Holder with an express waiver of this provision.
Each Holder of Class E Notes, Class F Notes or Subordinated Notes(i)understands and agrees that it will indemnify the Issuer for any U.S. federal withholding taximposed on payments made to or for the benefit of the Issuer that is attributable to such Holder’sownership of such Notes, including such Holder’s failure to timely provide or update any taxforms, certifications, or other information required under this Indenture and Security Agreementto be provided by it, or the inaccuracy of any such tax forms, certifications, or other information.This indemnification will continue with respect to any period during which the Holder held aNote, notwithstanding such Holder’s ceasing to be a Holder.
Each Holder of Class E Notes, Class F Notes or Subordinated Notes (j)hereby agrees to take any and all actions, and to furnish any and all information, requested by the Issuer to permit the Issuer to minimize any tax liability that would otherwise be imposed on the Issuer under Section 6225 of the Code (after amendment by P.L. 114-74), or any successor provision, including (if requested by the Issuer) by (i) filing amended tax returns to take into account any adjustment to the amount of any item of income, gain, loss, deduction, or credit of the beneficial owner, or of any Person’s distributive share thereof, and (ii) providing the Issuer with any information necessary for the Issuer to (x) establish the amount of any tax liability resulting from any such adjustment and (y) elect (in accordance with Section 6226 of the Code (after amendment by P.L. 114-74), or any successor provision) for each beneficial owner to take any such adjustment into account directly. Each such Holder shall be liable for all taxes and related interest, additional amounts and penalties and other liabilities including reasonable administrative costs resulting from or otherwise attributable to the partner’s allocable share (determined with respect to the applicable adjustment period) of the tax items affected by any applicable audit adjustment. This paragraph (i) shall survive the termination of any Holder’s interest in its Class D Notes, Class E Notes or Subordinated Notes.
Each holder of Notes that is a foreign person for U.S. federal income tax (k)purposes represents that it is not a member of an “expanded group” (within the meaning of the regulations issued under Section 385 of the Code) that includes a domestic corporation (as determined for U.S. federal income tax purposes) if such domestic corporation, directly or
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indirectly (through one or more entities that are treated for U.S. federal income tax purposes as partnerships, disregarded entities, or grantor trusts), owns Subordinated Notes.
Issuer Purchases of Rated DebtNotes. (a) NotwithstandingSection 2.16anything to the contrary in this Indenture and Security Agreement, the Investment Manager, onbehalf of the Issuer, may conduct purchases of the Rated Debt (or, in the case of the Class A Loans, prepayments)Notes, in whole or in part, during the Reinvestment Period in accordancewith, and subject to, the terms and conditions set forth in Section 2.16(b) below, by disbursingamounts in the Principal Collection Subaccount, or at any time, from issuances of Subordinated Notes or Junior Mezzanine Notes or Contributions accepted and received into the Permitted Use Account for purchases or prepayments, as applicable, of Rated DebtNotes in accordance with theprovisions described in this Section 2.16.2.16. The Trustee shall cancel in accordance withSection 2.10 any such purchased Rated Notes surrendered to it for cancellation or, in the case ofany Global Notes, the Trustee shall decrease the Aggregate Outstanding Amount of such GlobalNotes in its records by the original principalfull par amount of the purchased Rated Notes, andinstruct DTC or its nominee, as the case may be, to conform its records. The Investment Manager, on behalf of the Issuer, and shall provide notice to Moody’s of any such purchase or prepayment of Rated Debtof such cancellation or decrease in the Aggregate Outstanding Amount of such Global Notes to Fitch (so long as any Class A Notes remain outstanding) and Moody’s.
No purchases or prepayments, as applicable,repayments of the Rated(b)DebtNotes by, or on behalf of, the Issuer may occur unless each of the following conditions issatisfied:
such purchases or prepayments, as applicable, of Rated DebtNotes shall(i)occur in the following sequential order of priority: first, the Class X Notes and the ClassA-1 Notes, the Class A-2 Notes and the Class A Loans, pro rata, until the Class X Notes and the Class A ObligationsNotes are retired in full; second, the Class B-1 Notes and the Class B-2 Notes, pro rata, until the Class B Notes are retired in full; third, the Class C-1Notes and the Class C-2 Notes, pro rata, until the Class C Notes are retired in full;fourth, the Class D Notes, until the Class D Notes are retired in full; fifth, the Class ENotes, until the Class E Notes are retired in full; and sixth, the Class F Notes, until theClass F Notes are retired in full; provided that the Class A Obligations shall not be required to be purchased or prepaid, as applicable, on a pro rata basis, so long as an offer is made to purchase all Class A Obligations in accordance with clause (a)(ii);
(1) each such purchase or prepayments, as applicable, of Rated DebtNotes(ii)of any Class shall be made pursuant to an offer made to all Holders of the RatedDebtNotes of such Class, by notice to such Holders, which notice shall specify thepurchase price or prepayment amount (as a percentage of par) at which such purchase or prepayment, as applicable, will be effected, the maximum amount of Principal Proceedsthat will be used to effect such purchase or prepayment, as applicable, and the length ofthe period during which such offer will be open for acceptance, (2) each such Holdershall have the right, but not the obligation, to accept such offer in accordance with itsterms and (3) if the aggregate outstanding principal amount of Rated DebtNotes of therelevant Class held by Holders who accept such offer exceeds the amount of PrincipalProceeds specified in such offer, a portion of the Rated DebtNotes of each accepting
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holder shall be purchased or prepaid, as applicable, pro rata based on the respectiveoutstanding principal amount held by each such holder (adjusted as required for minimum denominations);
at least a Majority of the Subordinated Notes has consented thereto;(iii)
(iii) each such purchase or prepayment, as applicable, shall be effected(iv)only at prices equal to or discounted from par;
(iv) each such purchase or prepayment, as applicable, of Rated DebtNotes(v)shall be effected with Principal Proceeds (or, with Interest Proceeds, solely to pay anyor with proceeds from the issuance of additional Subordinated Notes and/or Junior Mezzanine Notes, or Contributions; provided that payment of accrued and unpaid interestand Deferred Interest on such Rated Debt)Notes shall be effected with Interest Proceeds, solely to the extent that, in the reasonable discretion of the Investment Manager, after giving effect on a pro forma basis to amounts owed under Section 11.1(a)(i) and taking into account scheduled distributions on the Assets that are expected to be received prior to the related Determination Date, sufficient Interest Proceeds will be available on the following Payment Date to pay all interest due on the Class A Notes and the Class B Notes;
(v) after giving effect to such purchase, each Par Value Ratio Test is (x) (vi)satisfied immediately prior to each such purchase and will be satisfied after giving effect to such purchase or (y)satisfied, or if not satisfied, is maintained or improved after giving effect to each such purchase, as compared to immediately prior to each such purchase;
(vi) no Event of Default shall have occurred and be continuing;(vii)
(vii) any Rated Notes to be purchased shall be surrendered to the Trustee(viii)for cancellation as set forth in Section 2.10;
(viii) each such purchase or prepayment, as applicable, will otherwise be(ix)conducted in accordance with applicable law; and
(ix) the Collateral AgentTrustee has received an officer’s certificate of the(x)Investment Manager to the effect that the conditions in this Section 2.16(b) have beensatisfied.
(c) Any prepayment of the Class A Loans pursuant to this Section 2.16 shall be made pursuant to the Credit Agreement.
ARTICLE III
CONDITIONS PRECEDENT
Conditions to Issuance of Notes on Closing Date. (a) The Notes toSection 3.1be issued on the Closing Date shall be executed by the Applicable Issuers and delivered to the
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Trustee for authentication and thereupon the same shall be authenticated and delivered by theTrustee upon Issuer Order and upon receipt by the Collateral AgentTrustee of the following:
Officers’ Certificates of the Co-Issuers Regarding Corporate Matters. An(i)Officer’s certificate of each of the Co-Issuers (A) evidencing the authorization by BoardResolution of the execution and delivery of this Indenture and Security Agreement, thePlacement Agency Agreement, the Credit Agreement, and, in the case of the Issuer, theInvestment Management Agreement, the Securities Account Control Agreement, theCollateral Administration Agreement, any Hedge Agreements and related transactiondocuments and in each case, the issuance, incurrence, execution, authentication anddelivery, as applicable, of (x) the DebtNotes applied for by it and specifying the StatedMaturity, principal amount and DebtNote Interest Rate of each Class of Rated DebtNotesto be authenticated and delivered, and the Stated Maturity and principal amount ofSubordinated Notes to be authenticated and delivered and (y) each requiredCertificatecertificate and lender note (if any), and (B) certifying that (1) the attached copyof the Board Resolution is a true and complete copy thereof, (2) such resolutions have notbeen rescinded and are in full force and effect on and as of the Closing Date and (3) theOfficers authorized to execute and deliver such documents hold the offices and have thesignatures indicated thereon.
Governmental Approvals. From each of the Co-Issuers either (A) a(ii)certificate of the Applicable Issuer or other official document evidencing the dueauthorization, approval or consent of any governmental body or bodies, at the timehaving jurisdiction in the premises, together with an Opinion of Counsel of suchApplicable Issuer to the effect that no other authorization, approval or consent of anygovernmental body is required for (x) the valid issuance of the Notes and (y) the valid incurrence of the Class A Loans, or (B) an Opinion of Counsel of the Applicable Issuer tothe effect that no such authorization, approval or consent of any governmental body isrequired for the valid issuance of such Notes except as have been given (provided that theopinions delivered pursuant to Section 3.1(a)(iii) may satisfy the requirement).
U.S. Counsel Opinions. Opinions of White & Case LLP, special U.S.(iii)counsel to the Co-Issuers, Winston & Strawn LLP, special U.S. counsel to the InvestmentManager and special tax counsel to the Issuer, and Seward & Kissel LLP, counsel to theTrustee, the Collateral Agent, the Loan Agent, the Income Note Paying Agent and theCollateral Administrator, in each case dated the Closing Date, in form and substancesatisfactory to the Issuer.
Cayman Counsel Opinion. An opinion of Maples and Calder, Cayman(iv)Islands counsel to the Issuer, dated the Closing Date, in form and substance satisfactoryto the Issuer.
Officers’ Certificates of Co-Issuers Regarding Indenture and Security (v)Agreement. An Officer’s certificate of each of the Co-Issuers stating that the ApplicableIssuer is not in default under this Indenture and Security Agreement or the Credit Agreement and that the issuance of the Notes applied for by it and the incurrence of the Class A Loans by it shall not result in a default or a breach of any of the terms, conditions
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or provisions of, or constitute a default under, its organizational documents, anyindenture or other agreement or instrument to which it is a party or by which it is bound,or any order of any court or administrative agency entered in any Proceeding to which itis a party or by which it may be bound or to which it may be subject; that all conditionsprecedent provided in this Indenture and Security Agreement and the Credit Agreementrelating to the authentication and delivery of the Notes applied for by it and the incurrence of the Class A Loans by it have been complied with; and that all expenses dueor accrued with respect to the Offering of the Notes and the incurrence of the Class A Loans or relating to actions taken on or in connection with the Closing Date have beenpaid or reserves therefor have been made. The Officer’s certificate of the Issuer shallalso state that all of its representations and warranties contained herein are true andcorrect as of the Closing Date.
Hedge Agreements. Executed copies of any Hedge Agreement entered(vi)into by the Issuer, if any.
Investment Management, Collateral Administration, Securities Account (vii)Control, Credit, Income Note Paying Agency and Administration Agreements. Anexecuted counterpart of the Investment Management Agreement, the CollateralAdministration Agreement, the Securities Account Control Agreement, the Credit Agreement, the Income Note Paying Agency Agreement, the Income NoteAdministration Agreement and the Administration Agreement.
Certificate of the Investment Manager. An Officer’s certificate of the(viii)Investment Manager, dated as of the Closing Date, to the effect that, to the bestknowledge of the Investment Manager, in the case of each Collateral Obligation pledgedto the Collateral AgentTrustee for inclusion in the Assets, as the case may be, on theClosing Date and immediately before the delivery of such Collateral Obligation on theClosing Date:
the Issuer has entered into binding agreements to purchase(A)Collateral Obligations with an aggregate par amount of at least U.S.$293 millionas of the Closing Date;
such Collateral Obligation satisfies the requirements of the(B)definition of “Collateral Obligation” and of Section 3.1(a)(x)(B);
each such Collateral Obligation was purchased by the Issuer in(C)compliance with the Tax Guidelines; and
no such Collateral Obligation is a Senior Secured Note, a Bond(D)(including any Senior Secured Bond, Unsecured Bond, High-Yield Bond orZero-Coupon Security) or a Letter of Credit Reimbursement Obligation.
Grant of Collateral Obligations. The Grant pursuant to the Granting(ix)Clause of this Indenture and Security Agreement of all of the Issuer’s right, title andinterest in and to the Collateral Obligations on the Closing Date and Delivery of such
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Collateral Obligations (including any promissory note and all other UnderlyingInstruments related thereto to the extent received by the Issuer) as contemplated bySection 3.3.
Certificate of the Issuer Regarding Assets. A certificate of an Authorized(x)Officer of the Issuer, dated as of the Closing Date, to the effect that, in the case of eachCollateral Obligation pledged to the Collateral AgentTrustee for inclusion in the Assets,on the Closing Date and immediately prior to the Delivery thereof on the Closing Date:
the Issuer is the owner of such Collateral Obligation free and clear(A)of any liens, claims or encumbrances of any nature whatsoever except for (i)those which are being released on the Closing Date and (ii) those Grantedpursuant to this Indenture and Security Agreement;
the Issuer has acquired its ownership in such Collateral Obligation(B)in good faith without notice of any adverse claim (as such term is defined inSection 8-102(a)(1) of the UCC), except as described in paragraph (A) above;
the Issuer has not assigned, pledged or otherwise encumbered any(C)interest in such Collateral Obligation (or, if any such interest has been assigned,pledged or otherwise encumbered, it has been released or is being released on theClosing Date) other than interests Granted pursuant to this Indenture and Security Agreement;
the Issuer has full right to Grant a security interest in and assign(D)and pledge such Collateral Obligation to the Collateral AgentTrustee;
based on the certificate of the Investment Manager delivered(E)pursuant to Section 3.1(a)(viii), each Collateral Obligation included in the Assetssatisfies the requirements of the definition of “Collateral Obligation” and ofSection 3.1(a)(x)(B); and
upon Grant by the Issuer, the Collateral AgentTrustee has a first(F)priority perfected security interest in the Collateral Obligations and other Assets,except as permitted by this Indenture and Security Agreement or the Credit Agreement.
Rating Letters. A letter signed by each Rating Agency confirming that(xi)each Class of Rated DebtNotes has been assigned the applicable Initial Rating and thatsuch ratings are in effect on the Closing Date.
Accounts. Evidence of the establishment of each of the Accounts.(xii)
Other Documents. Such other documents as the Collateral AgentTrustee(xiii)may reasonably require; provided that nothing in this clause (xiii) shall imply or impose aduty on the part of the Collateral AgentTrustee to require any other documents.
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The Issuer shall post copies of the documents specified in Section 3.1(a)(b)(other than the rating letters specified in clause (xi) thereof) on the 17g-5 Website as soon aspracticable after the Closing Date.
The Issuer shall timely file a United States Internal Revenue Service Form (c)8832 electing to be treated as a partnership for U.S. federal income tax purposes with an effective date that is no later than the Closing Date and, after filing, promptly provide a copy to the Initial Majority Subordinated Noteholder.
Conditions to Issuance of Additional DebtNotes. (a) AdditionalSection 3.2DebtNotes that is a Class of Notes to be issued on an Additional DebtNotes Closing Datepursuant to Section 2.4 may be executed by the Applicable Issuers and delivered to the Trusteefor authentication and thereupon the same shall be authenticated and delivered to the Issuer bythe Trustee upon Issuer Order, upon compliance with clauses (ix) and (x) of Section 3.1(a) (withall references therein to the Closing Date being deemed to be the applicable AdditionalDebtNotes Closing Date) and upon receipt by the Collateral AgentTrustee of the following:
Officers’ Certificates of the Co-Issuers Regarding Corporate Matters. An(i)Officer’s certificate of each of the Co-Issuers (1) evidencing the authorization by BoardResolution of the execution and delivery of a supplemental indenture and security agreement pursuant to Section 8.2(b) or an amendment to the Credit Agreement in the case of the incurrence of additional Class A Loans and the execution, authentication anddelivery of the Additional DebtNotes applied for by it and specifying the Stated Maturity,the principal amount and DebtNote Interest Rate of each Class of such AdditionalDebtNotes that are Rated DebtNotes and the Stated Maturity and principal amount of theSubordinated Notes to be authenticated and delivered, and (2) certifying that (a) theattached copy of such Board Resolution is a true and complete copy thereof, (b) suchresolutions have not been rescinded and are in full force and effect on and as of theAdditional DebtNotes Closing Date and (c) the Officers authorized to execute and deliversuch documents hold the offices and have the signatures indicated thereon.
Governmental Approvals. From each of the Co-Issuers either (A) a(ii)certificate of the Applicable Issuer or other official document evidencing the dueauthorization, approval or consent of any governmental body or bodies, at the timehaving jurisdiction in the premises, together with an Opinion of Counsel of suchApplicable Issuer to the effect that no other authorization, approval or consent of anygovernmental body is required for the valid issuance or incurrence, as applicable, of suchAdditional DebtNotes, or (B) an Opinion of Counsel of the Applicable Issuer to the effectthat no such authorization, approval or consent of any governmental body is required forthe valid issuance or incurrence, as applicable, of such Additional DebtNotes except ashave been given (provided that the opinions delivered pursuant to Section 3.2(a)(ii) maysatisfy the requirement).
U.S. Counsel Opinions. Opinions of White & CaseCadwalader, (iii)Wickersham & Taft LLP, special U.S. counsel to the Co-Issuers, Winston & Strawn LLP,special U.S. counsel to the Investment Manager and special tax counsel to the Issuer or
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other counsel acceptable to the Collateral Agent and the Trustee, dated the AdditionalDebtNotes Closing Date, in form and substance satisfactory to the Issuer, the Collateral Agent and the Trustee.
Cayman Counsel Opinion. An opinion of Maples and Calder, Cayman(iv)Islands counsel to the Issuer, or other counsel acceptable to the Collateral Agent and the Trustee, dated the Additional DebtNotes Closing Date, in form and substance satisfactoryto the Issuer.
Officers’ Certificates of Co-Issuers Regarding Indenture and Security (v)Agreement. An Officer’s certificate of each Co-Issuer stating that the Applicable Issueris not in default under this Indenture and Security Agreement or the Credit Agreementand that the issuance or incurrence, as applicable, of the Additional DebtNotes appliedfor by it shall not result in a default or a breach of any of the terms, conditions orprovisions of, or constitute a default under, its organizational documents, any indentureor other agreement or instrument to which it is a party or by which it is bound, or anyorder of any court or administrative agency entered in any Proceeding to which it is aparty or by which it may be bound or to which it may be subject; that all conditionsprecedent provided in this Indenture and Security Agreement, the Credit Agreement andthe supplemental indenture and security agreement pursuant to Section 8.2(b)8.3 relatingto the authentication and delivery of the Additional DebtNotes applied for have beencomplied with and that the authentication and delivery of the Additional DebtNotes isauthorized or permitted under this Indenture and Security Agreement, the Credit Agreement and the supplemental indenture and security agreement entered into inconnection with such Additional DebtNotes; and that all expenses due or accrued withrespect to the Offering of the Additional DebtNotes or relating to actions taken on or inconnection with the Additional DebtNotes Closing Date have been paid or reserved. TheOfficer’s certificate of the Issuer shall also state that all of its representations andwarranties contained herein are true and correct as of the Additional DebtNotes ClosingDate.
(vi) Irish Listing. If the Additional Debt is of a Class of Listed Notes, an Officer’s certificate of the Issuer to the effect that application will be made to list such Notes on the Irish Stock Exchange.
(vii) Notice to Rating Agencies. The Rating Agencies have been notified(vi)of such issuance and/or incurrence of Additional DebtNotes.
(viii) Other Documents. Such other documents as the Collateral (vii)AgentTrustee may reasonably require; provided that nothing in this clause (viii) shallimply or impose a duty on the Collateral AgentTrustee to so require any other documents.
Prior to any Additional DebtNotes Closing Date providing for the issuance of Rated DebtNotes,the Collateral AgentTrustee shall provide to the Holders notice of such issuance and/or incurrence of Additional DebtNotes as soon as reasonably practicable but in no case less than 15days prior to the Additional DebtNotes Closing Date; provided that the Collateral AgentTrusteeshall receive such notice at least two Business Days prior to the 15th day prior to such Additional
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DebtNotes Closing Date. On or prior to any Additional DebtNotes Closing Date, the Collateral Agent and the Trustee shall provide to the Holders copies of any supplemental indenture and security agreementsindentures executed as part of such issuance or incurrence, as applicable.
Custodianship; Delivery of Collateral Obligations and Eligible Section 3.3Investments. (a) The Investment Manager, on behalf of the Issuer, shall use commerciallyreasonable efforts to deliver or cause to be delivered to a custodian appointed by the Issuer,which shall be a Securities Intermediary (the “Custodian”), all Assets in accordance with thedefinition of “Deliver”. Initially, the Custodian shall be the Collateral AgentTrustee. TheCustodian hereby represents and warrants that (i) in the case of any non-Cash holding Accounts,such Accounts are segregated trust accounts held with the corporate trust department of a federalor state-chartered depository institution subject to regulations regarding fiduciary funds ondeposit similar to Title 12 of the Code of Federal Regulation Section 9.10(b) and such depositoryinstitution is rated at least “Baa1” by Moody’s, (ii) in the case of any Cash holding Accounts, ithas a long-term debt rating of at least “A2” or a short-term debt rating of at least “P-1” byMoody’s and (iii) in the case of any Account, it has a short-term issuer default rating of at least” “F1” and a long-term issuer default rating of at least “A” by Fitch (or, if no short-term issuerdefault rating exists, a long-term issuer default rating of not lower than “A+” by Fitch). TheCustodian also has capital and surplus of at least U.S.$200,000,000. If at any time the Custodianfails to satisfy these requirements, the Trustee shall appoint a successor Custodian within 30calendar days that is able to satisfy such requirements. Any successor Custodian shall, inaddition to satisfying the above requirements, be a state or national bank or trust company that isnot an Affiliate of the Issuer or the Co-Issuer and a Securities Intermediary. Subject to thelimited right to relocate Pledged Obligations as provided in Section 7.5(b), the Collateral AgentTrustee or the Custodian, as applicable, shall hold (i) all Collateral Obligations, EligibleInvestments, Cash and other investments purchased in accordance with this Indenture and Security Agreement and (ii) any other property of the Issuer otherwise Delivered to theCollateral AgentTrustee or the Custodian, as applicable, by or on behalf of the Issuer, in therelevant Account established and maintained pursuant to Article X; as to which in each case theCollateral AgentTrustee shall have entered into the Securities Account Control Agreement withthe Custodian providing, inter alia, that the establishment and maintenance of such Account shallbe governed by a law of a jurisdiction satisfactory to the Issuer and the Collateral AgentTrustee.
Each time that the Investment Manager on behalf of the Issuer directs or(b)causes the acquisition of any Collateral Obligation, Eligible Investment, or other investments,the Investment Manager (on behalf of the Issuer) shall, if the Collateral Obligation, EligibleInvestment, or other investment is required to be, but has not already been, transferred to therelevant Account, use commercially reasonable efforts to cause the Collateral Obligation,Eligible Investment, or other investment to be Delivered to the Custodian to be held in theCustodial Account (or in the case of any such investment that is not a Collateral Obligation, inthe Account in which the funds used to purchase the investment are held in accordance withArticle X) for the benefit of the Collateral AgentTrustee in accordance with this Indenture and Security Agreement. The security interest of the Collateral AgentTrustee in the funds or otherproperty used in connection with the acquisition shall, immediately and without further action onthe part of the Collateral AgentTrustee, be released. The security interest of the Collateral AgentTrustee shall nevertheless come into existence and continue in the Collateral Obligation,Eligible Investment, or other investment so acquired, including all interests of the Issuer in to
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any contracts related to and proceeds of the Collateral Obligations, Eligible Investments, or otherinvestments.
ARTICLE IV
SATISFACTION AND DISCHARGE
Satisfaction and Discharge of Indenture and Security Agreement.Section 4.1This Indenture and Security Agreement shall be discharged and shall cease to be of further effectexcept as to (i) rights of registration of transfer and exchange, (ii) substitution of mutilated,defaced, destroyed, lost or stolen Notes, (iii) rights of Holders to receive payments of principalthereof and interest thereon, (iv) the rights, protections, indemnities and immunities of theCollateral Agent and the Trustee and the specific obligations set forth below hereunder, (v) therights and immunities of the Investment Manager hereunder, under the Investment ManagementAgreement and under the Collateral Administration Agreement, (vi) the rights, protections,indemnities and immunities of the Collateral Administrator hereunder and under the CollateralAdministration Agreement and (vii) the rights of Holders as beneficiaries hereof with respect tothe property deposited with the Collateral AgentTrustee and payable to all or any of them (andthe Collateral AgentTrustee, on demand of and at the expense of the Issuer, shall execute properinstruments acknowledging satisfaction and discharge of this Indenture and Security Agreement)when:
(i) either:(a)
all (x) Notes theretofore authenticated and delivered to Holders,(A)other than (1) Notes which have been mutilated, defaced, destroyed, lost or stolenand which have been replaced or paid as provided in Section 2.7 and (2) Notes forwhose payment Money has theretofore irrevocably been deposited in trust andthereafter repaid to the Issuer or discharged from such trust, as provided inSection 7.3, have been delivered to the Trustee for cancellation and (y) Class A Loans have been repaid in full in accordance with the terms of the Credit Agreement (other than those Class A Loans for whose payment Money has theretofore irrevocably been deposited in trust and thereafter repaid to the Issuer, as provided in Section 7.3); or
all Notes not theretofore delivered to the Trustee for cancellation (B)or Class A Loans not repaid in full in accordance with the Credit Agreement (1)have become due and payable, or (2) shall become due and payable at their StatedMaturity within one year, or (3) are to be called for redemption pursuant toArticle IX (and, in the case of the Class A Loans prepaid in accordance with Section 3.3.5 of the Credit Agreement) under an arrangement satisfactory to theTrustee, the Loan Agent and the Collateral Agent for the giving of notice ofredemption by the Applicable Issuers pursuant to Section 9.5 hereto and Section 3.3.5 of the Credit Agreement and either (x) the Issuer has irrevocably depositedor caused to be deposited with the Collateral AgentTrustee, in trust for suchpurpose, Cash or non-callable direct obligations of the United States of America;provided that the obligations are entitled to the full faith and credit of the United
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States of America or are debt obligations which are rated “Aaa” by Moody’s and“AAA” by Fitch, in an amount sufficient, as recalculated in writing in anagreed-upon procedures report by a firm of Independent certified publicaccountants which are nationally recognized, to pay and discharge the entireindebtedness on such Notes not theretofore delivered to the Trustee forcancellation and Class A Loans not repaid in full pursuant to the Credit Agreement, for principal and interest to the date of such deposit (in the case ofDebtNotes which have become due and payable), or to the respective StatedMaturity or the respective Redemption Date, as the case may be, and shall haveGranted to the Collateral AgentTrustee a valid perfected security interest in suchEligible Investment that is of first priority or free of any adverse claim, asapplicable, and shall have furnished an Opinion of Counsel with respect thereto or(y) in the event all of the Assets are liquidated following the satisfaction of theconditions specified in Section 5.5(a), the Issuer shall have paid or caused to bepaid all proceeds of such liquidation of the Assets in accordance with the Priorityof Payments;
the Co-Issuers have paid or caused to be paid all other sums then due and(ii)payable hereunder (including any amounts then due and payable pursuant to the HedgeAgreements, the Collateral Administration Agreement and the Investment ManagementAgreement without regard to the Administrative Expense Cap) and under the Credit Agreement by the Issuer and no other amounts are scheduled to be due and payable bythe Issuer other than Dissolution Expenses (it being understood that the requirements ofthis clause (ii) may be deemed satisfied as set forth in Section 5.7); and
the Co-Issuers have delivered to the Collateral AgentTrustee, Officer’s(iii)certificates and an Opinion of Counsel, each stating that all conditions precedent hereinprovided for relating to the satisfaction and discharge of this Indenture and Security Agreement have been complied with;
provided, that in the case of clause (a)(i)(B)(x) above, the Issuer has delivered to the Collateral AgentTrustee an Opinion of Counsel of Independent U.S. tax counsel of nationally recognizedstanding in the United States experienced in such matters to the effect that the Holders ofDebtNotes would recognize no income, gain or loss for U.S. federal income tax purposes as aresult of such deposit and satisfaction and discharge of this Indenture and Security Agreement or the Credit Agreement.
Notwithstanding the satisfaction and discharge of this Indenture and Security Agreement, the rights and obligations of the Co-Issuers, the Trustee, the Collateral Agent, the Loan Agent,t the Investment Manager and, if applicable, the Holders, as the case may be, underSections 2.8, 4.2, 5.4(d), 5.9, 5.18, 6.1, 6.26.1(g), 6.5, 6.15(f), 7.1, 7.3, 13.1 and 14.14 shallsurvive.
Upon the discharge of this Indenture and Security Agreement, the Collateral AgentTrustee shall give prompt notice of such discharge to the Issuer, and shall provide suchcertifications to the Issuer or the Administrator as may be reasonably required by the Issuer orthe Administrator in order for the liquidation of the Issuer to be completed.
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Application of Money. All Monies deposited with the Collateral Section 4.2AgentTrustee pursuant to Section 4.1 shall be held and applied by it in accordance with theprovisions of the DebtNotes and this Indenture and Security Agreement, including, withoutlimitation, the Priority of Payments, to the payment of principal and interest (or other amountswith respect to the Subordinated Notes), either directly or through the Income Note PayingAgent, as the Collateral AgentTrustee may determine; and such Money shall be held in asegregated account identified as being held for the benefit of the Secured Parties, in accordancewith the rating requirements set out in Section 10.5(a).
Repayment of Monies Held by the Income Note Paying Agent. InSection 4.3connection with the satisfaction and discharge of this Indenture and Security Agreement withrespect to the DebtNotes, all Monies then held by the Income Note Paying Agent other than theCollateral AgentTrustee under the provisions of this Indenture and Security Agreement shall,upon demand of the Co-Issuers, be paid to the Collateral AgentTrustee to be held and appliedpursuant to Section 7.3 hereof and in accordance with the Priority of Payments and thereupon theIncome Note Paying Agent shall be released from all further liability with respect to suchMonies.
Limitation on Obligation to Incur Administrative Expenses. If atSection 4.4any time the sum of (i) Eligible Investments, (ii) Cash and (iii) amounts reasonably expected tobe received by the Issuer in Cash during the current Due Period (as certified by the InvestmentManager in its reasonable judgment) is less than the sum of Dissolution Expenses and anyaccrued and unpaid Administrative Expenses, then notwithstanding any other provision of thisIndenture and Security Agreement, the Issuer shall no longer be required to incur AdministrativeExpenses as otherwise required by this Indenture and Security Agreement to any Person otherthan the Trustee, the Collateral Agent, the Administrator and their Affiliates, and failure to paysuch amounts or provide or obtain such opinions, reports or services shall not constitute aDefault hereunder, and the Collateral AgentTrustee shall have no liability for any failure toobtain or receive any of the foregoing opinions, reports or services. The foregoing shall not,however, limit, supersede or alter any right afforded to the Collateral Agent and the Trusteeunder this Indenture and Security Agreement to refrain from taking action in the absence of itsreceipt of any such opinion, report or service which it reasonably determines is necessary for itsown protection.
ARTICLE V
REMEDIES
Events of Default. “Event of Default,” wherever used herein,Section 5.1means any one of the following events (whatever the reason for such Event of Default andwhether it shall be voluntary or involuntary or be effected by operation of law or pursuant to anyjudgment, decree or order of any court or any order, rule or regulation of any administrative orgovernmental body):
a default in the payment, when due and payable, of (i) any interest on any(a)Class X Note, Class A ObligationsNote or any Class B Note or, if there are no Class X Notes,
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Class A ObligationsNotes or Class B Notes Outstanding, any Class C Note or, if there are noClass X Notes, Class A ObligationsNotes, Class B Notes or Class C Notes Outstanding, anyClass D Note, or, if there are no Class X Notes, Class A ObligationsNotes, Class B Notes, ClassC Notes or Class D Notes Outstanding, any Class E Note, or, if there are no Class A ObligationsX Notes, Class A Notes, Class B Notes, Class C Notes, Class D Notes or Class ENotes Outstanding, any Class F Note and, in each case, the continuation of any such default forfive (5) Business Days, or (ii) any principal, interest, or Deferred Interest on, or any RedemptionPrice in respect of, any Rated DebtNote at its Stated Maturity or any Redemption Date;provided, (1) that in the case of a default in payment under clause (ii) above on any RedemptionDate, and such default continues for ten (10) Business Days; provided, further, that in the case ofa default in payment under either clause (i) or (ii) above resulting solely from an administrativeerror or omission by the Trustee, the Collateral Agent, the Loan Agent, any Paying Agent, theIncome Note Paying Agent or the registrar of the DebtNotes, such default continues for a periodof seven (7) or more Business Days after the earlier of when the Collateral AgentTrusteereceives written notice or a Bank Officer of the Collateral AgentTrustee has actual knowledge ofthe occurrence of such administrative error or omission and (2) in the case of a default in the payment of principal of any Rated Note on any Redemption Date thereof where (A) such default is due solely to a delayed or failed settlement of any asset sale by the Issuer (or the Investment Manager on the Issuer’s behalf), (B) the Issuer (or the Investment Manager on the Issuer’s behalf) had entered into a binding agreement for the sale of such asset prior to the applicable Redemption Date, (C) such delayed or failed settlement is due solely to circumstances beyond the control of the Issuer and the Investment Manager and (D) the Issuer (or the Investment Manager on the Issuer’s behalf) has used commercially reasonable efforts to cause such settlement to occur prior to the Redemption Date and without such delay or failure, then such default will not be an Event of Default unless such failure continues for thirty (30) calendar days after such Redemption Date; provided, further, that the failure to effect (I) any Optional Redemption (including a redemption following a Tax Event) for which notice is withdrawn in accordance with the terms of this Indenture or (II) a Redemption by Refinancing for which the Refinancing was not able to be effected will, in each case, not constitute an Event of Default;
the failure on any Payment Date to disburse amounts in excess of (b)U.S.$100,000 available in the Payment Account in accordance with the Priority of Payments (other than as provided in clause (a) above) and continuation of such failure for a period of five (5) Business Days (provided, that if such failure results solely from an administrative error or omission by the Collateral Agent, such default continues for a period of seven (7) or more Business Days after the earlier of when the Collateral Agent receives written notice or a Bank Officer of the Collateral Agent has actual knowledge of such administrative error or omission);[reserved];
either of the Co-Issuers or the Assets becomes an investment company(c)required to be registered under the Investment Company Act and such requirement has not beeneliminated after a period of forty-five (45) days;
except as otherwise provided in this Section 5.1, a default, in the(d)performance, or breach, of any other material covenant or other material agreement of the Issueror the Co-Issuer in this Indenture and Security Agreement or the Credit Agreement which has amaterial adverse effect on any Holder (it being understood, without limiting the generality of the
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foregoing, that any failure to meet any Concentration Limitation, Portfolio Quality Test,Coverage Test or the Reinvestment Diversion Test is not an Event of Default), or the failure ofany material representation or warranty of the Issuer or the Co-Issuer made in this Indenture and Security Agreement or the Credit Agreement or in any certificate or other writing deliveredpursuant hereto or in connection herewith to be correct in all material respects when the sameshall have been made, and the continuation of such default, breach or failure for a period ofthirty (30forty-five (45) days after either notice (i) to the Investment Manager by registered orcertified mail or overnight courier from the Collateral AgentTrustee or the Applicable Issuers or(ii) to the Co-Applicable Issuers, the Investment Manager and the Collateral AgentTrustee by theHolders of not less than a SupermajorityMajority of the Controlling Class, specifying suchdefault, breach or failure and requiring it to be remedied and stating that such notice is a “Noticeof Default” hereunder;
on any Measurement Date so long as any Class A Notes are Outstanding,(e)the failure of the quotient of (i) the sum of (A) the Collateral Principal Amount (excludingDefaulted Obligations), plus (B) the Market Value of each Defaulted Obligation, divided by (ii)the Aggregate Outstanding Amount of the Class A ObligationsNotes, to equal or exceed 102.5%;
the entry of a decree or order by a court having competent jurisdiction(f)adjudging the Issuer or the Co-Issuer as bankrupt or insolvent, or approving as properly filed apetition seeking reorganization, arrangement, adjustment or composition of or in respect of theIssuer or the Co-Issuer under the Bankruptcy Law or any other applicable law, or appointing areceiver, liquidator, assignee, or sequestrator (or other similar official) of the Issuer or theCo-Issuer or of any substantial part of its property, respectively, or ordering the winding up orliquidation of its affairs, and the continuance of any such decree or order unstayed and in effectfor a period of 60 consecutive days; or
the institution by the shareholders of the Issuer or the members of the(g)Co-Issuer of Proceedings to have the Issuer or the Co-Issuer, as the case may be, adjudicated asbankrupt or insolvent, or the consent by the shareholders of the Issuer or the members of theCo-Issuer to the institution of bankruptcy or insolvency Proceedings against the Issuer or theCo-Issuer, as the case may be, or the filing by the Issuer or the Co-Issuer of a petition or answeror consent seeking reorganization or relief under the Bankruptcy Law or any other similarapplicable law, or the consent by the Issuer or the Co-Issuer to the filing of any such petition orto the appointment in a Proceeding of a receiver, liquidator, assignee, trustee or sequestrator (orother similar official) of the Issuer or the Co-Issuer or of any substantial part of its property,respectively, or the making by the Issuer or the Co-Issuer of an assignment for the benefit ofcreditors, or the admission by the Issuer or the Co-Issuer in writing of its inability to pay itsdebts generally as they become due, or the taking of any action by the Issuer or the Co-Issuer infurtherance of any such action.
Upon obtaining knowledge (in the case of the Trustee, the Loan Agent or the Collateral Agent, the actual knowledge of a Bank Officer) of the occurrence of an Event ofDefault, each of (i) the Co-Issuers, (ii) the Trustee, and (iii) the Collateral Agent, (iv) the Loan Agent and (v) the Investment Manager shall notify each other in writing and the Collateral AgentTrustee shall provide the notices of Default required under Section 6.15(d).
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Acceleration of Maturity; Rescission and Annulment. (a) If anSection 5.2Event of Default occurs and is continuing (other than an Event of Default specified in Section 5.1(f) or (g)), the Collateral AgentTrustee shall, upon the written direction of a Supermajority ofthe Controlling Class, by notice to the Applicable Issuers and each of the Rating Agencies,declare the principal of all the Rated DebtNotes to be immediately due and payable, and uponany such declaration such principal, together with all accrued and unpaid interest thereon(including, in the case of the Deferred Interest Notes, any Deferred Interest), and other amountspayable hereunder, shall become immediately due and payable and the Reinvestment Periodshall terminate. If an Event of Default specified in Section 5.1(f) or (g) occurs, all unpaidprincipal, together with all accrued and unpaid interest thereon, of all the Rated DebtNotes, andother amounts payable thereunder and hereunder, shall automatically become due and payablewithout any declaration or other act on the part of the Collateral AgentTrustee or any Holder ofDebtNotes.
At any time after such a declaration of acceleration of maturity has been(b)made and before a judgment or decree for payment of the Money due has been obtained by theCollateral AgentTrustee as hereinafter provided in this Article V, a Supermajority of theControlling Class by written notice to the Issuer and the Collateral AgentTrustee, may rescindand annul such declaration and its consequences if:
The Issuer or the Co-Issuer has paid or deposited with the Collateral (i)AgentTrustee a sum sufficient to pay:
all unpaid installments of interest and principal then due on the(A)Rated DebtNotes (other than any principal amounts due to the occurrence of anacceleration);
to the extent that the payment of such interest is lawful, interest(B)upon any Deferred Interest at the applicable DebtNote Interest Rates; and
all unpaid taxes and Administrative Expenses of the Co-Issuers(C)and other sums paid, incurred or advanced by the Collateral AgentTrusteehereunder and any other amounts then payable by the Co-Issuers hereunder priorto such Administrative Expenses; and
if it has been determined that all Events of Default, other than the(ii)nonpayment of the interest on or principal of the Rated DebtNotes, have (A) been cured,and a Supermajority of the Controlling Class by written notice to the Collateral AgentTrustee has agreed with such determination (which agreement shall not beunreasonably withheld), or (B) been waived as provided in Section 5.14.
No such rescission shall affect any subsequent Default or impair any rightconsequent thereon. Any Hedge Agreement in effect upon such declaration of an accelerationmust remain in effect until liquidation of the Assets has begun and such declaration is no longercapable of being rescinded or annulled; provided that the Issuer shall nevertheless be entitled to
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designate an early termination date under and in accordance with the terms of such HedgeAgreement.
Collection of Indebtedness and Suits for Enforcement by the Section 5.3Collateral AgentTrustee. The Applicable Issuers covenant that if a default shall occur in respectof the payment of any principal of or interest when due and payable on any Rated DebtNotes, theApplicable Issuers shall, upon demand of the Collateral AgentTrustee, pay to the Collateral AgentTrustee, for the benefit of the Holder of such Rated DebtNotes, the whole amount, if any,then due and payable on such Rated DebtNotes for principal and interest with interest upon theoverdue principal, at the applicable DebtNote Interest Rate, and, in addition thereto, such furtheramount as shall be sufficient to cover the costs and expenses of collection, including thereasonable compensation, expenses, disbursements and advances of the Collateral AgentTrusteeand its agents and counsel.
If the Issuer or the Co-Issuer fails to pay such amounts forthwith upon suchdemand, the Collateral AgentTrustee, in its own name and as trustee of an express trust, may,and shall upon written direction of a Supermajority of the Controlling Class (subject to theCollateral AgentTrustee’s rights hereunder), institute a Proceeding for the collection of the sumsso due and unpaid, may prosecute such Proceeding to judgment or final decree, and may enforcethe same against the Applicable Issuers or any other obligor upon the Rated DebtNotes andcollect the Monies adjudged or decreed to be payable in the manner provided by law out of theAssets.
If an Event of Default occurs and is continuing, the Collateral AgentTrustee may,and shall upon written direction of a Supermajority of the Controlling Class (subject to theCollateral AgentTrustee’s rights hereunder), proceed to protect and enforce its rights and therights of the Secured Parties by such appropriate Proceedings as the Collateral AgentTrusteeshall deem most effectual (if no such direction is received by the Collateral AgentTrustee) or asthe Collateral AgentTrustee may be directed by a Supermajority of the Controlling Class, toprotect and enforce any such rights, whether for the specific enforcement of any covenant oragreement in this Indenture and Security Agreement or in aid of the exercise of any powergranted herein, or to enforce any other proper remedy or legal or equitable right vested in theCollateral AgentTrustee by this Indenture and Security Agreement or by law.
In case there shall be pending Proceedings relative to the Issuer or the Co-Issueror any other obligor upon the Rated DebtNotes under the Bankruptcy Law or any otherapplicable bankruptcy, insolvency or other similar law, or in case a receiver, assignee or trusteein bankruptcy or reorganization, liquidator, sequestrator or similar official shall have beenappointed for or taken possession of the Issuer, the Co-Issuer or their respective property or suchother obligor or its property, or in case of any other comparable Proceedings relative to theIssuer, the Co-Issuer or other obligor upon the Rated DebtNotes, or the creditors or property ofthe Issuer, the Co-Issuer or such other obligor, the Collateral AgentTrustee, regardless ofwhether the principal of any Rated DebtNotes shall then be due and payable as therein expressedor by declaration or otherwise and regardless of whether the Collateral AgentTrustee shall havemade any demand pursuant to the provisions of this Section 5.3, shall be entitled andempowered, by intervention in such Proceedings or otherwise:
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to file and prove a claim or claims for the whole amount of principal and(a)interest owing and unpaid in respect of the Rated DebtNotes, as applicable, and to file such otherpapers or documents as may be necessary or advisable in order to have the claims of theCollateral AgentTrustee (including any claim for reasonable compensation to the Collateral AgentTrustee and each predecessor Collateral AgentTrustee, and their respective agents,attorneys and counsel, and for reimbursement of all reasonable expenses and liabilities incurred,and all advances made, by the Collateral AgentTrustee and each predecessor Collateral AgentTrustee, except as a result of gross negligence, willful misconduct or bad faith) and of theHolders of the DebtNotes allowed in any Proceedings relative to the Issuer, the Co-Issuer orother obligor upon the Rated DebtNotes or to the creditors or property of the Issuer, theCo-Issuer or such other obligor;
unless prohibited by applicable law and regulations, to vote on behalf of(b)the Holders of the Rated DebtNotes upon the direction of such Holders, in any election of atrustee or a standby trustee in arrangement, reorganization, liquidation or other bankruptcy orinsolvency Proceedings or person performing similar functions in comparable Proceedings; and
to collect and receive any Monies or other property payable to or(c)deliverable on any such claims, and to distribute all amounts received with respect to the claimsof the Holders of the DebtNotes and of the Collateral AgentTrustee on their behalf; and anytrustee, receiver or liquidator, custodian or other similar official is hereby authorized by each ofthe Holders of Rated DebtNotes to make payments to the Collateral AgentTrustee, and, in theevent that the Collateral AgentTrustee shall consent to the making of payments directly to theHolders of Rated DebtNotes to pay to the Collateral AgentTrustee such amounts as shall besufficient to cover reasonable compensation to the Collateral AgentTrustee, each predecessorCollateral AgentTrustee and their respective agents, attorneys and counsel, and all otherreasonable expenses and liabilities incurred, and all advances made, by the Collateral AgentTrustee and each predecessor Collateral AgentTrustee except as a result of grossnegligence, willful misconduct or bad faith.
Nothing herein contained shall be deemed to authorize the Collateral AgentTrustee to authorize or consent to or vote for or accept or adopt on behalf of any Holdersof Rated DebtNotes, any plan of reorganization, arrangement, adjustment or compositionaffecting the Rated DebtNotes or any Holder thereof, or to authorize the Collateral AgentTrusteeto vote in respect of the claim of any Holders of Rated DebtNotes in any such Proceeding except,as aforesaid, to vote for the election of a trustee in bankruptcy or similar person.
In any Proceedings brought by the Collateral AgentTrustee on behalf of theHolders of the Rated DebtNotes (and any such Proceedings involving the interpretation of anyprovision of this Indenture and Security Agreement to which the Collateral AgentTrustee shallbe a party), the Collateral AgentTrustee shall be held to represent all the Holders of the RatedDebtNotes.
Notwithstanding anything in this Section 5.3 to the contrary, the Collateral AgentTrustee may not sell or liquidate the Assets or institute Proceedings in furtherance thereofpursuant to this Section 5.3 except according to the provisions specified in Section 5.5(a).
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Remedies. (a) If an Event of Default shall have occurred and beSection 5.4continuing, and the Rated Debt hasNotes have been declared due and payable and suchdeclaration and its consequences have not been rescinded and annulled, the Co-Issuers agree thatthe Collateral AgentTrustee may, and shall, upon written direction of a Supermajority of theControlling Class (subject to the Collateral AgentTrustee’s rights hereunder), to the extentpermitted by applicable law, exercise one or more of the following rights, privileges andremedies:
institute Proceedings for the collection of all amounts then payable on the(i)Rated DebtNotes or otherwise payable under this Indenture and Security Agreement and the Credit Agreement, whether by declaration or otherwise, enforce any judgmentobtained, and collect from the Assets any Monies adjudged due;
sell or cause the sale of all or a portion of the Assets or rights or interests(ii)therein, at one or more public or private sales called and conducted in any mannerpermitted by law and in accordance with Section 5.17;
institute Proceedings from time to time for the complete or partial(iii)foreclosure of this Indenture and Security Agreement with respect to the Assets;
exercise any remedies of a secured party under the UCC and take any(iv)other appropriate action to protect and enforce the rights and remedies of the Collateral AgentTrustee and the Holders of the Rated DebtNotes hereunder (including, withoutlimitation, exercising all rights of the Collateral AgentTrustee under the SecuritiesAccount Control Agreement); and
exercise any other rights and remedies that may be available at law or in(v)equity;
provided that the Collateral AgentTrustee may not sell or liquidate the Assets or instituteProceedings in furtherance thereof pursuant to this Section 5.4 except according to the provisionsspecified in Section 5.5(a).
The Collateral AgentTrustee may, but need not, obtain (as an AdministrativeExpense of the Co-Issuers) and rely upon an opinion of an Independent investment banking firmof national reputation, or other appropriate advisor concerning the matter, which may (but neednot) be the Placement Agent, as to the feasibility of any action proposed to be taken inaccordance with this Section 5.4 and as to the sufficiency of the proceeds and other amountsreceivable with respect to the Assets to make the required payments of principal of and intereston the Rated DebtNotes, which opinion shall be conclusive evidence as to such feasibility orsufficiency and the cost of which shall be commercially reasonable.
If an Event of Default as described in Section 5.1(d) hereof shall have(b)occurred and be continuing the Collateral AgentTrustee may, and at the written direction of theHolders of not less than 25% of the Aggregate Outstanding Amount of the Controlling Class(subject to the Collateral AgentTrustee’s rights hereunder), shall, institute a Proceeding solely tocompel performance of the covenant or agreement or to cure the representation or warranty, the
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breach of which gave rise to the Event of Default under such Section, and enforce any equitabledecree or order arising from such Proceeding.
Upon any sale, whether made under the power of sale hereby given or by(c)virtue of judicial Proceedings, any Secured Party may bid for and purchase the Assets or any partthereof and, upon compliance with the terms of sale, may hold, retain, possess or dispose of suchproperty in its or their own absolute right without accountability; and any purchaser at any suchsale of Assets may, in paying the purchase Money, deliver to the Collateral AgentTrustee forcancellation any of the Class A ObligationsNotes in lieu of Cash equal to the amount whichshall, upon distribution of the net proceeds of such sale, be payable on the Class AObligationsNotes so delivered by such Holder (taking into account the Priority of Payments andArticle XIII). Said Class A ObligationsNotes, in case the amounts payable thereon shall be lessthan the amount due thereon, shall be returned to the Holders thereof after proper notation hasbeen made thereon to show partial payment.
Upon any sale, whether made under the power of sale hereby given or by virtue ofjudicial Proceedings, the receipt of the Collateral AgentTrustee, or of the Officer making a saleunder judicial Proceedings, shall be a sufficient discharge to the purchaser or purchasers at anysale for its or their purchase Money, and such purchaser or purchasers shall not be obliged to seeto the application thereof.
Any such sale, whether under any power of sale hereby given or by virtue ofjudicial Proceedings, shall bind the Co-Issuers, the Collateral AgentTrustee and the Holders ofthe Rated DebtNotes, shall operate to divest all right, title and interest whatsoever, either at lawor in equity, of each of them in and to the property sold, and shall be a perpetual bar, both at lawand in equity, against each of them and their successors and assigns, and against any and allPersons claiming through or under them.
Notwithstanding any other provision of this Indenture and Security (d)Agreement, none of the Holders of DebtNotes, the Collateral AgentTrustee or the other SecuredParties may, prior to the date which is one year and one day (or if longer, any applicablepreference period) after the payment in full of all DebtNotes, institute against, or join any otherPerson in instituting against, the Issuer, the Co-Issuer, the Income Note Issuer or any IssuerSubsidiary any bankruptcy, reorganization, arrangement, insolvency, moratorium or liquidationProceedings, or other Proceedings under Cayman Islands, U.S. federal or State bankruptcy orsimilar laws. Nothing in this Section 5.4 shall preclude, or be deemed to stop, the Collateral AgentTrustee (i) from taking any action prior to the expiration of the aforementioned period in(A) any case or Proceeding voluntarily filed or commenced by the Issuer or the Co-Issuer or (B)any involuntary insolvency Proceeding filed or commenced by a Person other than the Collateral AgentTrustee, or (ii) from commencing against the Issuer or the Co-Issuer or any of itsproperties any legal action which is not a bankruptcy, reorganization, arrangement, insolvency,moratorium or liquidation Proceeding.
The Issuer or the Co-Issuer, as applicable, shall, so long as any DebtNotes(e)remains Outstanding and for a year and a day thereafter, and subject to the proviso below, timelyfile an answer and any other appropriate pleading objecting to (i) the institution of anyProceeding to have the Issuer or the Co-Issuer, as the case may be, adjudicated as bankrupt or
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insolvent or (ii) the filing of any petition seeking relief, reorganization, arrangement, adjustmentor composition of or in respect of the Issuer or the Co-Issuer, as the case may be, underBankruptcy Law or any other applicable law; provided, that the obligations set forth in clauses(i) and (ii) above shall be subject to the availability of funds therefor under the Priority ofPayments. The reasonable fees, costs, charges and expenses incurred by the Issuer or Co-Issuer(including reasonable attorneys’ fees and expenses) in connection with taking any such actionshall be paid as Administrative Expenses.
Optional Preservation of Assets. (a) Notwithstanding anything toSection 5.5the contrary herein, if an Event of Default shall have occurred and be continuing, the Collateral AgentTrustee shall retain the Assets securing the Rated DebtNotes intact (except as otherwiseexpressly permitted or required by Section 7.16(c), Section 10.8 and Section 12.1), collect andcause the collection of the proceeds thereof and make and apply all payments and deposits andmaintain all accounts in respect of the Assets and the DebtNotes in accordance with the Priorityof Payments and the provisions of Article X, Article XII and Article XIII unless:
the Collateral AgentTrustee, in consultation with the Investment Manger(i)pursuant to Section 5.5(c), determines that the anticipated proceeds of a sale orliquidation of all or any portion of the Assets (after deducting the reasonable expenses ofsuch sale or liquidation) would be sufficient to discharge in full the amounts then due (or,in the case of interest, accrued) and unpaid on the Rated DebtNotes for principal andinterest (including accrued and unpaid Deferred Interest) and all amounts payable prior topayment of principal on such Rated DebtNotes (including (x) amounts due and owing asAdministrative Expenses (without regard to the Administrative Expense Cap), (y)amounts payable to the Investment Manager as Senior Management Fees and, solely asthe result of the operation of the Priority of Payments, any Senior Management FeeInterest thereon) and (z) amounts payable to any Hedge Counterparty upon liquidation ofall or any portion of the Assets) and a Supermajority of the Controlling Class agrees withsuch determination;
with respect to an Event of Default specified in Section 5.1(a) or (e), the(ii)Holders of at least a Supermajority of the Class A ObligationsNotes or, if no Class AObligationsNotes are Outstanding, a Supermajority of the Class B Notes direct the saleand liquidation of the Assets; or
(A) with respect to anyan Event of Default specified in Section 5.1(b), (c), (iii)(d), (f) or (g) and, if no Class A Obligations or Class B Notes are Outstanding, Section 5.1(a)a) (solely with respect to a failure to pay on the Class A Notes) or (e) (without regard to the occurrence of any other Event of Default prior or subsequent to such Event of Default, and unless such Event of Default occurred solely as a result of acceleration and application of Section 11.1(a)(iii)), the Holders of at least a Majority of the Class A Notes direct the sale and liquidation of the Assets and (B) with respect to any other Event of Default, Holders of at least a Supermajority of each Class of Rated DebtNotes (votingseparately by Class) direct the sale (and the manner thereof) and liquidation of the Assets (or,; provided that if no ClassesClass of Rated DebtNotes are then Outstanding, aMajority of the Subordinated Notes) may direct the sale (and the manner thereof) and liquidation of the Assets.
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Prior to the sale of any Collateral Obligation in connection with an exercise of remedies described above, the Trustee will use commercially reasonable efforts to notify the Investment Manager and the Holders of Subordinated Notes of its intent to sell any Collateral Obligation in accordance with the Indenture. Prior to the Trustee accepting any bid in respect of such a sale of a Collateral Obligation, the Investment Manager and the holders of a Majority of the Subordinated Notes shall have the right, by giving notice to the Trustee within three hours after the Trustee has notified such parties of the bid proposed to be accepted by the Trustee, to submit (on its behalf or on behalf of funds or accounts managed by such party), and the Trustee shall accept, a Firm Bid to purchase such Collateral Obligation on the same terms and conditions applicable to the potential purchaser.
Any Holder of Subordinated Notes shall have the right, subject to the same terms and conditions afforded to other bidders, to bid on Assets to be sold as part of a liquidation of the Assets following an Event of Default and an acceleration of the Rated Notes.
The Collateral AgentTrustee shall give written notice of the retention of theAssets to the Issuer with a copy to the Co-Issuer and the Investment Manager. So long as suchEvent of Default is continuing, any such retention pursuant to this Section 5.5(a) may berescinded at any time when the conditions specified in clause (i) or (ii) exist.
In the event a liquidation of all or any portion of the Assets is commenced inaccordance with this Section 5.5, all unpaid principal, together with all accrued and unpaidinterest thereon, of all the Rated DebtNotes, and other amounts payable under this Indenture and Security Agreement, shall automatically become due and payable without any declaration orother act on the part of the Collateral AgentTrustee or any Holder of DebtNotes.
Nothing contained in Section 5.5(a) shall be construed to require the(b)Collateral AgentTrustee to sell the Assets securing the Rated DebtNotes if the conditions setforth in clause (i) or (ii) of Section 5.5(a) are not satisfied. Nothing contained in Section 5.5(a)shall be construed to require the Collateral AgentTrustee to preserve the Assets securing theDebtNotes if prohibited by applicable law.
In determining whether the condition specified in Section 5.5(a)(i) exists,(c)the Collateral AgentTrustee shall, with the written consent of a Supermajority of the ControllingClass, request bid prices with respect to each security contained in the Assets from twonationally recognized dealers at the time making a market in such securities (as identified by theInvestment Manager to the Collateral AgentTrustee in writing) and shall compute the anticipatedproceeds of sale or liquidation on the basis of the lower of such bid prices for each such security.In the event that the Collateral AgentTrustee, with the cooperation of the Investment Manager, isonly able to obtain bid prices with respect to a security contained in the Assets from onenationally recognized dealer at the time making a market in such securities, the Collateral AgentTrustee shall compute the anticipated proceeds of sale or liquidation on the basis of suchone bid price for such security. For the purposes of making the determinations required pursuantto Section 5.5(a)(i), the Collateral AgentTrustee shall apply the standards set forth in Section 6.15(c)(iii). In addition, for the purposes of determining issues relating to the execution of a saleor liquidation of all or any portion of the Assets and the execution of a sale or other liquidation
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thereof in connection with a determination whether the condition specified in Section 5.5(a)(i)exists, the Collateral AgentTrustee may retain and conclusively rely without limitation on anopinion of an Independent investment banking firm of national reputation or other appropriateadvisor concerning the matter (the cost of which shall be payable as an Administrative Expense).
The Collateral AgentTrustee shall deliver to the Holders of the DebtNotes and theInvestment Manager a report stating the results of any determination required pursuant toSection 5.5(a)(i) no later than ten (10) days after such determination is made. Unless aSupermajority of the Controlling Class has not consented to the Collateral AgentTrustee makinga determination pursuant to this Section 5.5(c), the Collateral AgentTrustee shall make thedeterminations required by Section 5.5(a)(i) within thirty (30) days after an Event of Default (orsuch longer period as is necessary if the information required to make such determination has notyet been received) or at the request of a Supermajority of the Controlling Class at any time, butnot more frequently than once in any calendar quarter, during which the Collateral AgentTrusteeretains the Assets pursuant to Section 5.5(a).
Collateral AgentTrustee May Enforce Claims without Possession Section 5.6of Notes. All rights of action and claims under this Indenture and Security Agreement or underany of the Rated DebtNotes may be prosecuted and enforced by the Collateral AgentTrusteewithout the possession of any of the Rated DebtNotes or the production thereof in any trial orother Proceeding relating thereto, and any such action or Proceeding instituted by the Collateral AgentTrustee shall be brought in its own name as trustee of an express trust, and any recovery ofjudgment shall be applied as set forth in Section 5.7.
Application of Money Collected. Any Money collected by theSection 5.7Collateral AgentTrustee (after payment of costs of collection, liquidation and enforcement) withrespect to the DebtNotes pursuant to this Article V and any Money that may then be held orthereafter received by the Collateral AgentTrustee with respect to the DebtNotes hereunder shallbe applied, subject to Section 13.1 and in accordance with the provisions of Section 11.1(a)(iii),at the date or dates fixed by the Collateral AgentTrustee (each such date to occur on a PaymentDate). Upon the final distribution of all proceeds of any liquidation effected hereunder, theprovisions of Section 4.1(a) and (b) shall be deemed satisfied for the purposes of discharging thisIndenture and Security Agreement pursuant to Article IV.
Limitation on Suits. No Holder of any DebtNotes shall have anySection 5.8right to institute any Proceedings, judicial or otherwise, with respect to this Indenture and Security Agreement, or for the appointment of a receiver or trustee, or for any other remedyhereunder, unless:
such Holder has previously given to the Collateral AgentTrustee written(a)notice of an Event of Default;
the Holders of a Supermajority of the Controlling Class shall have made(b)written request to the Collateral AgentTrustee to institute Proceedings in respect of such Eventof Default in its own name as Collateral AgentTrustee hereunder and such Holder or Holdershave provided the Collateral AgentTrustee security or indemnity reasonably satisfactory to the
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Collateral AgentTrustee against the costs, expenses (including reasonable attorneys’ fees andexpenses) and liabilities to be incurred in compliance with such request;
the Collateral AgentTrustee, for 30 days after its receipt of such notice,(c)request and provision of such indemnity, has failed to institute any such Proceeding; and
no direction inconsistent with such written request has been given to the(d)Collateral AgentTrustee during such 30 day period by a Supermajority of the Controlling Class;
it being understood and intended that no one or more Holders of the DebtNotes shall have anyright in any manner whatever by virtue of, or by availing of, any provision of this Indenture and Security Agreement to affect, disturb or prejudice the rights of any other Holders of theDebtNotes of the same Class or to obtain or to seek to obtain priority or preference over anyother Holders of the DebtNotes of the same Class or to enforce any right under this Indenture and Security Agreement, except in the manner herein provided and for the equal and ratablebenefit of all the Holders of the DebtNotes of the same Class subject to and in accordance withSection 13.1 and the Priority of Payments.
In the event the Collateral AgentTrustee shall receive conflicting or inconsistentrequests and indemnity from two or more groups of Holders of the Controlling Class, eachrepresenting less than a Supermajority of the Controlling Class, pursuant to this Section 5.8, theCollateral AgentTrustee shall act in accordance with the request specified by the group ofHolders with the greatest percentage of the Aggregate Outstanding Amount of the ControllingClass, notwithstanding any other provisions of this Indenture and Security Agreement. If thegroups represent the same percentage, the Collateral AgentTrustee in its sole discretion maydetermine what action, if any, shall be taken.
Unconditional Rights of Holders of Rated DebtNotes to Receive Section 5.9Principal and Interest. Subject to Sections 2.8(i), 2.13, 5.13, 6.15(h) and 13.1, butnotwithstanding any other provision in this Indenture and Security Agreement, the Holder of anyRated DebtNotes shall have the right, which is absolute and unconditional, to receive payment ofthe principal of and interest on such Rated DebtNotes (including any Deferred Interest), as suchprincipal and interest becomes due and payable in accordance with the Priority of Payments andSection 13.1, and, subject to the provisions of Section 5.4(d) and Section 5.8, to instituteProceedings for the enforcement of any such payment, and such right shall not be impairedwithout the consent of such Holder. Holders of Rated DebtNotes ranking junior to DebtNotesstill Outstanding shall have no right to institute proceedings for the enforcement of any suchpayment until such time as no Rated DebtNotes ranking senior to such Rated DebtNotes remainsOutstanding, which right shall be subject to the provisions of Section 5.4(d) and Section 5.8, andshall not be impaired without the consent of any such Holder.
Restoration of Rights and Remedies. If the Collateral Section 5.10AgentTrustee or any Holder of DebtNotes has instituted any Proceeding to enforce any right orremedy under this Indenture and Security Agreement and such Proceeding has been discontinuedor abandoned for any reason, or has been determined adversely to the Collateral AgentTrustee orto such Holder of DebtNotes, then and in every such case the Co-Issuers, the Collateral AgentTrustee and the Holders of the DebtNotes shall, subject to any determination in such
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Proceeding, be restored severally and respectively to their former positions hereunder, andthereafter all rights and remedies of the Collateral AgentTrustee and the Holders of theDebtNotes shall continue as though no such Proceeding had been instituted.
Rights and Remedies Cumulative. No right or remedy hereinSection 5.11conferred upon or reserved to the Collateral AgentTrustee or to the Holders of the DebtNotes isintended to be exclusive of any other right or remedy, and every right and remedy shall, to theextent permitted by law, be cumulative and in addition to every other right and remedy givenhereunder or now or hereafter existing at law or in equity or otherwise. The assertion oremployment of any right or remedy hereunder, or otherwise, shall not prevent the concurrentassertion or employment of any other appropriate right or remedy.
Delay or Omission Not Waiver. No delay or omission of theSection 5.12Collateral AgentTrustee or any Holder of Rated DebtNotes to exercise any right or remedyaccruing upon any Event of Default shall impair any such right or remedy or constitute a waiverof any such Event of Default or an acquiescence therein or of a subsequent Event of Default.Every right and remedy given by this Article V or by law to the Collateral AgentTrustee or to theHolders of Rated DebtNotes may be exercised from time to time, and as often as may be deemedexpedient, by the Collateral AgentTrustee or by the Holders of the Rated DebtNotes.
Control by Supermajority of Controlling Class. NotwithstandingSection 5.13any other provision of this Indenture and Security Agreement, a Supermajority of the ControllingClass shall have the right following the occurrence, and during the continuance of, an Event ofDefault to cause the institution of and direct the time, method and place of conducting anyProceeding for any remedy available to the Collateral AgentTrustee, and to direct the exercise ofany trust, right, remedy or power conferred upon the Collateral AgentTrustee; provided that:
such direction shall not conflict with any rule of law or with any express(a)provision of this Indenture and Security Agreement;
the Collateral AgentTrustee may take any other action deemed proper by(b)the Collateral AgentTrustee that is not inconsistent with such direction; provided that subject toSection 6.15, the Collateral AgentTrustee need not take any action that it determines mightinvolve it in liability or expense (unless the Collateral AgentTrustee has received the indemnityas set forth in (c) below);
the Collateral AgentTrustee shall have been provided with security or(c)indemnity reasonably satisfactory to it; and
notwithstanding the foregoing, any direction to the Collateral (d)AgentTrustee to undertake a Sale of the Assets shall be by the Holders of the DebtNotes securedthereby representing the requisite percentage of the Aggregate Outstanding Amount ofDebtNotes specified in Section 5.5.
Waiver of Past Defaults. Prior to the time a judgment or decree forSection 5.14payment of the Money due has been obtained by the Collateral AgentTrustee, as provided in this
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Article V, a Supermajority of the Controlling Class may on behalf of the Holders of all theDebtNotes waive any past Default and its consequences, except a Default:
in the payment of the principal of any Rated DebtNotes (which may be(a)waived with the consent of each Holder of such Rated DebtNotes);
in the payment of interest on the DebtNotes of the Controlling Class(b)(which may be waived with the consent of the Holders of 100% of the DebtNotes of theControlling Class);
in respect of a covenant or provision hereof that under Section 8.2 cannot(c)be modified or amended without the waiver or consent of the Holder of each OutstandingDebtNotes materially and adversely affected thereby (which may be waived with the consent ofeach such Holder); or
in respect of a representation contained in Section 7.18 (which may be(d)waived by a Supermajority of the Controlling Class if the Global Rating Agency Condition issatisfied).
In the case of any such waiver, the Co-Issuers, the Collateral AgentTrustee andthe Holders of the DebtNotes shall be restored to their former positions and rights hereunder,respectively, but no such waiver shall extend to any subsequent or other Default or impair anyright consequent thereto. The Collateral AgentTrustee shall promptly give written notice of anysuch waiver to Moody’s, Fitch, the Investment Manager and each Holder.
Upon any such waiver, such Default shall cease to exist, and any Event of Defaultarising therefrom shall be deemed to have been cured, for every purpose of this Indenture and Security Agreement, but no such waiver shall extend to any subsequent or other Default orimpair any right consequent thereto.
Undertaking for Costs. All parties to this Indenture and Security Section 5.15Agreement agree, and each Holder of any DebtNotes by his acceptance thereof shall be deemedto have agreed, that any court may in its discretion require, in any suit for the enforcement of anyright or remedy under this Indenture and Security Agreement, or in any suit against the Trustee, the Collateral Agent, Collateral Administrator or Investment Manager for any action taken, oromitted by it as Trustee, Collateral AgentTrustee, Collateral Administrator or InvestmentManager, as applicable, the filing by any party litigant in such suit of an undertaking to pay thecosts of such suit, and that such court may in its discretion assess reasonable costs, includingreasonable attorneys’ fees, against any party litigant in such suit, having due regard to the meritsand good faith of the claims or defenses made by such party litigant; but the provisions of thisSection 5.15 shall not apply to any suit instituted by the Collateral AgentTrustee, to any suitinstituted by any Holder of DebtNotes, or group of Holders of the DebtNotes, holding in theaggregate more than 10% in Aggregate Outstanding Amount of the Controlling Class, or to anysuit instituted by any Holders of the DebtNotes for the enforcement of the payment of theprincipal of or interest on any DebtNotes on or after the applicable Stated Maturity (or, in thecase of redemption, on or after the applicable Redemption Date).
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Waiver of Stay or Extension Laws. The Co-Issuers covenant (toSection 5.16the extent that they may lawfully do so) that they shall not at any time insist upon, or plead, or inany manner whatsoever claim or take the benefit or advantage of, any stay or extension law orany valuation, appraisement, redemption or marshalling law or rights, in each case whereverenacted, now or at any time hereafter in force, which may affect the covenants, the performanceof or any remedies under this Indenture and Security Agreement; and the Co-Issuers (to theextent that they may lawfully do so) hereby expressly waive all benefit or advantage of any suchlaw or rights, and covenant that they shall not hinder, delay or impede the execution of anypower herein granted to the Collateral AgentTrustee, but shall suffer and permit the execution ofevery such power as though no such law had been enacted or rights created.
Sale of Assets. (a) The power to effect any sale (a “Sale”) of all orSection 5.17any portion of the Assets pursuant to Section 5.4 and 5.5 shall not be exhausted by any one ormore Sales as to any portion of such Assets remaining unsold, but shall continue unimpaireduntil the entire Assets shall have been sold or all amounts secured by the Assets shall have beenpaid. The Collateral AgentTrustee may upon notice provided as soon as reasonably practicableto the Holders of the DebtNotes, and shall, upon direction of the Holders of the DebtNotesrepresenting the requisite percentage of the Aggregate Outstanding Amount of DebtNotes havingthe power to direct such Sale, from time to time postpone any Sale by public announcementmade at the time and place of such Sale pursuant to Section 5.5. The Collateral AgentTrusteehereby expressly waives its rights to any amount fixed by law as compensation for any Sale;provided that the Collateral AgentTrustee and the Investment Manager shall be authorized todeduct the reasonable costs, charges and expenses incurred by it in connection with such Salefrom the proceeds thereof notwithstanding the provisions of Section 6.6.
The Collateral AgentTrustee or the Investment Manager may bid for and(b)acquire any portion of the Assets in connection with a public Sale thereof, and may pay all orpart of the purchase price by crediting against amounts owing on the Rated DebtNotes or otheramounts secured by the Assets, all or part of the net proceeds of such Sale after deducting thereasonable costs, charges and expenses incurred by the Collateral AgentTrustee in connectionwith such Sale notwithstanding the provisions of Section 6.6. The Rated DebtNotes need not beproduced in order to complete any such Sale, or in order for the net proceeds of such Sale to becredited against amounts owing on the Notes. The Collateral AgentTrustee may hold, lease,operate, manage or otherwise deal with any property so acquired in any manner permitted by lawin accordance with this Indenture and Security Agreement.
If any portion of the Assets consists of securities issued without(c)registration under the Securities Act (“Unregistered Securities”), the Investment Manager mayseek an Opinion of Counsel, or, if no such Opinion of Counsel can be obtained and with thewritten consent of a Supermajority of the Controlling Class, seek a no action position from theSecurities and Exchange Commission or any other relevant federal or State regulatoryauthorities, regarding the legality of a public or private Sale of such Unregistered Securities.
The Collateral AgentTrustee shall execute and deliver an appropriate(d)instrument of conveyance transferring its interest in any portion of the Assets in connection witha Sale thereof. In addition, the Collateral AgentTrustee is hereby irrevocably appointed the
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agent and attorney in fact of the Issuer to transfer and convey its interest in any portion of theAssets in connection with a Sale thereof, and to take all action necessary to effect such Sale. Nopurchaser or transferee at such a sale shall be bound to ascertain the Collateral AgentTrustee’sauthority, to inquire into the satisfaction of any conditions precedent or see to the application ofany Monies.
The Collateral AgentTrustee shall provide notice as soon as reasonably(e)practicable of any public Sale to the Holders of the Subordinated Notes, and the Holders of theSubordinated Notes shall be permitted to participate in any such public Sale to the extent suchHolders meet any applicable eligibility requirements with respect to such Sale.
Action on the Notes. The Collateral AgentTrustee’s right to seekSection 5.18and recover judgment on the DebtNotes or under this Indenture and Security Agreement shallnot be affected by the seeking or obtaining of or application for any other relief under or withrespect to this Indenture and Security Agreement. Neither the lien of this Indenture and Security Agreement nor any rights or remedies of the Collateral AgentTrustee or the Holders of theDebtNotes shall be impaired by the recovery of any judgment by the Collateral AgentTrusteeagainst the Issuer or by the levy of any execution under such judgment upon any portion of theAssets or upon any of the assets of the Issuer or the Co-Issuer.
ARTICLE VI
THE TRUSTEE AND THE COLLATERAL AGENT
Certain Duties and Responsibilities of the Trustee. (a) ExceptSection 6.1during the continuance of an Event of Default known to the Trustee:
the Trustee undertakes to perform such duties and only such duties as are(i)specifically set forth in this Indenture and Security Agreement, and no implied covenantsor obligations shall be read into this Indenture and Security Agreement against theTrustee; and
in the absence of bad faith on its part, the Trustee may conclusively rely,(ii)as to the truth of the statements and the correctness of the opinions expressed therein,upon certificates or opinions furnished to the Trustee and conforming to the requirementsof this Indenture and Security Agreement; provided that in the case of any suchcertificates or opinions which by any provision hereof are specifically required to befurnished to the Trustee, the Trustee shall be under a duty to examine the same todetermine whether or not they substantially conform on their face to the requirements ofthis Indenture and Security Agreement and shall promptly, but in any event within threeBusiness Days in the case of an Officer’s certificate furnished by the InvestmentManager, notify the party delivering the same if such certificate or opinion does notconform. If a corrected form shall not have been delivered to the Trustee within fifteendays after such notice from the Trustee, the Trustee shall so notify the Holders of Notes.
In case an Event of Default known to the Trustee has occurred and is(b)continuing, the Trustee shall, prior to the receipt of directions, if any, from a Majority of the
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Controlling Class, exercise such of the rights and powers vested in it by this Indenture and Security Agreement, and use the same degree of care and skill in its exercise, as a prudent personwould exercise or use under the circumstances in the conduct of such person’s own affairs.
No provision of this Indenture and Security Agreement shall be construed(c)to relieve the Trustee from liability for its own grossly negligent action, its own grosslynegligent failure to act, or its own willful misconduct or bad faith, except that:
this subsection shall not be construed to limit the effect of subsection (a)(i)of this Section 6.1;
the Trustee shall not be liable for any error of judgment made in good(ii)faith by a Bank Officer, unless it shall be proven that the Trustee was grossly negligent inascertaining the pertinent facts;
the Trustee shall not be liable with respect to any action taken or omitted(iii)to be taken by it in good faith in accordance with the direction of the Issuer or theCo-Issuer or the Investment Manager in accordance with this Indenture and Security Agreement and/or a Majority (or such other percentage as may be required by the termshereof) of the Controlling Class (or other Class if required or permitted by the termshereof), relating to the time, method and place of conducting any Proceeding for anyremedy available to the Trustee, or exercising any trust or power conferred upon theTrustee, under this Indenture and Security Agreement;
no provision of this Indenture and Security Agreement shall require the(iv)Trustee to expend or risk its own funds or otherwise incur any financial liability in theperformance of any of its duties hereunder, or in the exercise of any of its rights orpowers contemplated hereunder, if it shall have reasonable grounds for believing thatrepayment of such funds or indemnity satisfactory to it against such risk or liability is notreasonably assured to it unless such risk or liability relates to the performance of itsordinary services, including mailing of notices under Article V, under this Indenture and Security Agreement (and it is hereby expressly acknowledged and agreed, withoutimplied limitation, that the enforcement or exercise of rights and remedies under Article V, and/or the commencement of or participation in any legal proceeding does notconstitute “ordinary services”); and
in no event shall the Trustee be liable for special, indirect, punitive or(v)consequential loss or damage of any kind whatsoever (including but not limited to lostprofits) even if the Trustee has been advised of the likelihood of such damages andregardless of the form of such action.
For all purposes under this Indenture and Security Agreement, the Trustee(d)shall not be deemed to have notice or knowledge of any Default or Event of Default described inSection 5.1(c) (d), (f), or (g) or any other matter unless a Bank Officer assigned to and workingin the Corporate Office has actual knowledge thereof or unless written notice of any event whichis in fact such an Event of Default or Default or other matter, as the case may be, is received bythe Trustee at the Corporate Office, and such notice references the DebtNotes generally, the
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Issuer, the Co-Issuer, the Assets or this Indenture and Security Agreement. For purposes ofdetermining the Trustee’s responsibility and liability hereunder, whenever reference is made inthis Indenture and Security Agreement to such an Event of Default or a Default, such referenceshall be construed to refer only to such an Event of Default or Default of which the Trustee isdeemed to have notice as described in this Section 6.1.
Whether or not therein expressly so provided, every provision of this(e)Indenture and Security Agreement relating to the conduct or affecting the liability of or affordingprotection to the Trustee shall be subject to the provisions of this Section 6.1.
In addition to its other obligations set forth herein, the Trustee shall(f)provide any information actually in its possession to the Investment Manager promptly after theInvestment Manager’s reasonable request therefor provided that the Trustee shall not beobligated to provide any information that it may be restricted from doing so by legal, regulatoryor contractual reasons.
The Trustee shall, upon reasonable (but no less than three Business Days’)(g)prior written notice to the Trustee, permit any representative of a Holder of DebtNotes, duringthe Trustee’s normal business hours, to examine all books of account, records, reports and otherpapers of the Trustee (other than items protected by attorney-client privilege) relating to theDebtNotes, to make copies and extracts therefrom (the reasonable out-of-pocket expensesincurred in making any such copies or extracts to be reimbursed to the Trustee by such Holder)and to discuss the Trustee’s actions, as such actions relate to the Trustee’s duties with respect tothe DebtNotes, with the Trustee’s Officers and employees responsible for carrying out theTrustee’s duties with respect to the DebtNotes.
The Trustee shall have no duty to monitor or verify compliance with the (h)U.S. Risk Retention Rules
Certain Rights of Trustee. Except as otherwise provided inSection 6.2Section 6.1:
the Trustee may conclusively rely and shall be fully protected in acting or(a)refraining from acting upon any resolution, certificate, statement, instrument, opinion, report,including any Accountants Report, notice, request, direction, consent, order, note or other paperor document believed by it to be genuine and to have been signed or presented by the properparty or parties;
any direction of the Issuer or the Co-Issuer mentioned herein shall be(b)sufficiently evidenced by an Issuer Order;
whenever in the administration of this Indenture and Security Agreement(c)the Trustee shall (i) deem it desirable that a matter be proved or established prior to taking,suffering or omitting any action hereunder, the Trustee (unless other evidence be hereinspecifically prescribed) may, in the absence of bad faith on its part, rely upon an Officer’scertificate or Issuer Order, or (ii) be required to determine the value of any Assets or fundshereunder or the cash flows projected to be received therefrom, the Trustee may, in the absence
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of bad faith on its part, rely on reports of nationally recognized accountants (which may or maynot be the Independent accountants appointed by the Issuer pursuant to Section 10.8(a)),investment bankers or other Persons qualified to provide the information required to make suchdetermination, including nationally recognized dealers in securities of the type being valued andsecurities quotation services;
as a condition to the taking or omitting of any action by it hereunder, the(d)Trustee may consult with counsel and the advice of such counsel or any Opinion of Counselshall be full and complete authorization and protection in respect of any action taken or omittedby it hereunder in good faith and in reliance thereon;
the Trustee shall be under no obligation to exercise, enforce or to honor(e)any of the rights or powers vested in it by this Indenture and Security Agreement at the requestor direction of any of the Holders pursuant to this Indenture and Security Agreement, unless suchHolders shall have provided to the Trustee security or indemnity reasonably satisfactory to itagainst the costs, expenses (including reasonable attorneys’ fees and expenses) and liabilitieswhich might reasonably be incurred by it in compliance with such request or direction;
the Trustee shall not be bound to make any investigation into the facts or(f)matters stated in any resolution, certificate, statement, instrument, opinion, report, notice,request, direction, consent, order, note or other paper or document, but the Trustee, in itsdiscretion, may, and upon the written direction of a Majority of the Controlling Class or a Majority of the Subordinated Notes or of a Rating Agency shall (subject to the right of the Trustee hereunder to be satisfactorily indemnified), make such further inquiry or investigationinto such facts or matters as it may see fit or as it shall be directed, and the Trustee shall beentitled, on reasonable prior notice to the Co-Issuers and the Investment Manager, to examinethe books and records relating to the DebtNotes and the Assets, personally or by agent orattorney, during the Co-Issuers’ or the Investment Manager’s normal business hours; providedthat the Trustee shall, and shall cause its agents to, hold in confidence all such information,except (i) to the extent disclosure may be required by law or by any regulatory, administrative orgovernmental authority and (ii) to the extent that the Trustee, in its sole judgment, maydetermine that such disclosure is consistent with its obligations hereunder; provided, further, thatthe Trustee may disclose on a confidential basis any such information to its agents, attorneys andauditors in connection with the performance of its responsibilities hereunder;
the Trustee may execute any of the trusts or powers hereunder or perform(g)any duties hereunder either directly or by or through agents or attorneys; provided that theTrustee shall not be responsible for any willful misconduct, bad faith or gross negligence on thepart of any non-Affiliated agent or non-Affiliated attorney appointed with due care by ithereunder;
the Trustee shall not be liable for any action it takes or omits to take in(h)good faith that it reasonably believes to be authorized or within its rights or powers hereunder;
nothing herein shall be construed to impose an obligation on the part of(i)the Trustee to recalculate, evaluate, verify or independently determine the accuracy of anyreport, certificate or information received from the Issuer or Investment Manager;
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to the extent any defined term hereunder, or any calculation required to be(j)made or determined by the Trustee hereunder, is dependent upon or defined by reference togenerally accepted accounting principles (as in effect in the United States) (“GAAP”), theTrustee shall be entitled to request and receive (and conclusively rely upon) instruction from theIssuer or from a firm of nationally recognized accountants (which may or may not be theIndependent accountants appointed by the Issuer pursuant to Section 10.8(a)) and in the absenceof its receipt of timely instruction therefrom, shall be entitled to obtain from an Independentaccountant at the expense of the Issuer as to the application of GAAP in such connection, in anyinstance;
to the extent permitted by applicable law, the Trustee shall not be required(k)to give any bond or surety in respect of the execution of this Indenture and Security Agreementor otherwise;
the Trustee shall not be deemed to have notice or knowledge of any matter(l)unless a Bank Officer has actual knowledge thereof or unless written notice thereof is receivedby the Trustee at the Corporate Office and such notice references the DebtNotes generally, theIssuer, the Co-Issuer or this Indenture and Security Agreement;
the permissive rights of the Trustee to take or refrain from taking any(m)actions enumerated in this Indenture and Security Agreement shall not be construed as a duty;
the Trustee shall not be responsible for delays or failures in performance(n)resulting from acts beyond its control, including, without limitation, strikes, work stoppages,accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophesor acts of God, and interruptions, loss or malfunctions of utilities, communications or computer(software and hardware) services, it being understood that the Trustee shall use reasonable bestefforts which are consistent with accepted practices in the banking industry to maintainperformance and, if necessary, resume performance as soon as practicable under thecircumstances;
in making or disposing of any investment permitted by this Indenture and (o)Security Agreement, the Trustee is authorized to deal with itself (in its individual capacity) orwith any one or more of its Affiliates, whether it or such Affiliate is acting as a subagent of theTrustee or for any third person or dealing as principal for its own account. If otherwisequalified, obligations of the Bank or any of its Affiliates shall qualify as Eligible Investmentshereunder;
the Trustee or its Affiliates are permitted to receive additional(p)compensation that could be deemed to be in the Trustee’s economic self-interest for (i) servingas investment adviser, administrator, shareholder, servicing agent, custodian or sub-custodianwith respect to certain of the Eligible Investments, (ii) using Affiliates to effect transactions incertain Eligible Investments and (iii) effecting transactions in certain Eligible Investments. Suchcompensation is not payable or reimbursable under Section 6.6;
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to help fight the funding of terrorism and money laundering activities, the(q)Trustee may obtain, verify, and record information that identifies individuals or entities thatestablish a relationship or open an account with the Trustee. The Trustee may ask for the name,address, tax identification number and other information that will allow the Trustee to identifythe individual or entity who is establishing the relationship or opening the account. The Trusteemay also ask for formation documents such as articles of incorporation, an offeringmemorandum, or other identifying documents to be provided. In accordance with the U.S.Unlawful Internet Gambling Act (the “Gambling Act”), the Issuer may not, and shall not directthe Trustee to, use the Accounts or other Bank facilities in the United States to process“restricted transactions” as such term is defined in U.S. 31 CFR Section 132.2(y). Therefore,neither the Issuer nor any person who has an ownership interest in or control over the Accountsmay use it to process or facilitate payments for prohibited internet gambling transactions;
the Trustee shall not be liable for the actions or omissions of the(r)Investment Manager, any Clearing Agency, the Issuer, the Co-Issuer, the Collateral AgentTrustee, the Income Note Paying Agent (other than the Trustee), the Income NoteRegistrar (other than the Trustee) or any Authenticating Agent (other than the Trustee) andwithout limiting the foregoing, the Trustee shall not be under any obligation to monitor, evaluateor verify compliance by the Investment Manager with the terms hereof or the InvestmentManagement Agreement, or to verify or independently determine the accuracy of informationreceived by it from the Investment Manager (or from any selling institution, agent bank, trusteeor similar source) with respect to the Assets; provided, that such rights, protections, benefits,immunities and indemnities should be in addition to any rights, immunities and indemnitiesprovided in the Securities Account Control Agreement, the Income Note Paying AgentAgreement or any other document to which the Bank in such capacity is a party;
the Trustee and the Collateral Administrator shall be entitled to(s)conclusively rely on the Investment Manager with respect to whether or not a CollateralObligation meets the criteria specified in the definition thereof and for the characterization,classification, designation or categorization of each Collateral Obligation to the extent suchcharacterization, classification, designation or categorization is subjective or judgmental innature or based on information not readily available to the Trustee and Collateral Administrator;
in the event the Bank is also acting in the capacity of the Income Note(t)Paying Agent, Income Note Registrar, Collateral Agent, Loan AgentTrustee, Registrar, TransferAgent, Custodian, Calculation Agent or Securities Intermediary, the rights, protections, benefits,immunities and indemnities afforded to the Trustee pursuant to this Article VI shall also beafforded to the Bank acting in such capacities;
the Trustee shall have no duty (i) to see to any recording, filing, or(u)depositing of this Indenture and Security Agreement or any supplemental indenture and security agreement or any financing statement or continuation statement evidencing a security interest, orto see to the maintenance of any such recording, filing or depositing or to any rerecording,refiling or redepositing of any thereof or (ii) to maintain any insurance;
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the Collateral Administrator shall have the same rights, privileges and(v)indemnities afforded to the Trustee in this Article VI; provided that such rights, immunities andindemnities shall be in addition to, and not in limitation of, any rights, immunities andindemnities provided in the Collateral Administration Agreement and that, in connectiontherewith, references in such Sections to (i) “”Bank Officer” shall mean an officer of theCollateral Administrator and (ii) Corporate Office shall be deemed deleted;
neither the Trustee nor the Collateral Administrator shall have any(w)obligation to determine: (a) if a Collateral Obligation meets the criteria specified in the definitionthereof, or (b) if the conditions specified in the definition of “Deliver” have been complied with;and
neither the Trustee nor the Collateral Administrator shall have any(x)responsibility to make any inquiry or investigation as to, and shall no obligation in respect of, theterms of any engagement of Independent accountants by the Issuer (or the Collateral Manager on behalf of the Issuer) or the terms of any agreed upon procedures in respect of such engagement;provided, however, that the Trustee shall be authorized, upon receipt of an Issuer Order directingthe same, to execute any acknowledgment or other agreement with the Independent accountsrequired for the Trustee to receive any of the reports or instructions provided for herein, whichacknowledgment or agreement may include restrictions or prohibitions on the disclosure ofinformation or documents provided to it by such firm of Independent accounts (including to theHolders, it being understood that the Trustee shall deliver such acknowledgment or agreement inconclusive reliance on the Issuer Order); provided, further, that notwithstanding the foregoing, inno event shall the Trustee be required to execute any agreement in respect of the Independentaccountants that the Trustee determines adversely affects it.
Not Responsible for Recitals or Issuance of Notes. The recitalsSection 6.3contained herein and in the Notes, other than the Certificate of Authentication thereon, shall betaken as the statements of the Applicable Issuers; and the Trustee assumes no responsibility fortheir correctness. The Trustee shall not be responsible to any Holder for any recitals, statements,information, representations or warranties herein or any document and makes no representationas to the validity, effectiveness, genuineness, enforceability, perfection, collectability, priority orsufficiency of this Indenture and Security Agreement, the Assets or the Notes. The Trustee shallnot be accountable for the use or application by the Co-Issuers of the Notes or the proceedsthereof or any Money paid to the Co-Issuers pursuant to the provisions hereof.
May Hold DebtNotes. The Trustee, the Collateral Agent, theSection 6.4Income Note Paying Agent, Registrar or any other agent of the Co-Issuers, in its individual orany other capacity, may become the owner or pledgee of DebtNotes and may otherwise deal withthe Co-Issuers or any of their Affiliates with the same rights it would have if it were not the Trustee, the Collateral Agent, the Income Note Paying Agent, Registrar or such other agent.
Money Held in Trust. Money held by the Trustee hereunder shallSection 6.5be held in trust to the extent required herein. The Trustee shall be under no liability for intereston any Money received by it hereunder, except in its capacity as the Bank to the extent ofincome or other gain on investments which are deposits in or certificates of deposit of the Bank
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in its commercial capacity and income or other gain actually received by the Trustee on EligibleInvestments.
Compensation and Reimbursement of Trustee. (a) The IssuerSection 6.6agrees:
to pay the Trustee on each Payment Date reasonable compensation as set(i)forth in a separate fee schedule dated on or before the Closing Date between the Trusteeand the Issuer for all services rendered by it hereunder (which compensation shall not belimited by any provision of law in regard to the compensation of a trustee of an expresstrust);
except as otherwise expressly provided herein, to reimburse the Trustee in(ii)a timely manner upon its request for all reasonable expenses, disbursements and advancesincurred or made by the Trustee in accordance with any provision of this Indenture and Security Agreement (including, without limitation, securities transaction charges and thereasonable compensation and expenses and disbursements of its agents and legal counseland of any accounting firm or investment banking firm employed by the Trustee pursuantto Sections 5.4, 5.5, 10.7 or any other term of this Indenture and Security Agreement,except any such expense, disbursement or advance as may be attributable to its grossnegligence, willful misconduct or bad faith) but with respect to securities transactioncharges, only to the extent any such charges have not been waived during a CollectionPeriod due to the Trustee’s receipt of a payment from a financial institution with respectto certain Eligible Investments, as specified by the Investment Manager in writing; and
to indemnify the Trustee and its Officers, directors, employees and agents(iii)for, and to hold them harmless against, any loss, liability or expense incurred withoutgross negligence, willful misconduct or bad faith on their part, and arising out of or inconnection with the acceptance or administration of this Indenture and Security Agreement and the transactions contemplated thereby and documents related hereto,including the costs and expenses of defending themselves (including reasonableattorney’s fees and costs) against any claim or liability in connection with the exercise orperformance of any of their powers or duties hereunder and under any other transactiondocument related hereto.
The Trustee shall receive amounts pursuant to this Section 6.6 in(b)accordance with the Priority of Payments but only to the extent that funds are available for thepayment thereof. Subject to Section 6.8, the Trustee shall continue to serve as Trustee under thisIndenture and Security Agreement notwithstanding the fact that the Trustee shall not havereceived amounts due it hereunder; provided that nothing herein shall impair or affect theTrustee’s rights under Section 6.8. No direction by the Holders of the DebtNotes shall affect theright of the Trustee to collect amounts owed to it under this Indenture and Security Agreement.If on any date when a fee or expense shall be payable to the Trustee pursuant to this Indenture and Security Agreement insufficient funds are available for the payment thereof, any portion of afee not so paid shall be deferred and payable on such later date on which a fee shall be payableand sufficient funds are available therefor. The Issuer’s obligations under this Section 6.6 shall
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survive the termination of this Indenture and Security Agreement and the resignation or removalof the Trustee pursuant to Section 6.8.
The Trustee hereby agrees not to cause the filing of a petition in(c)bankruptcy for the non-payment to the Trustee of any amounts provided by this Section 6.6 untilat least one year and one day, or if longer the applicable preference period then in effect, afterthe payment in full of all DebtNotes issued and/or incurred under this Indenture and Security Agreement or the Credit Agreement, as applicable. When the Trustee incurs expenses after theoccurrence of a Default or Event of Default under Section 5.1(f) or (g), such expenses areintended to constitute expenses of administration under the Bankruptcy Law or any otherapplicable U.S. federal or state bankruptcy, insolvency or similar law.
The Issuer’s payment obligations to the Trustee under this Section 6.6(d)shall be secured by the lien of this Indenture and Security Agreement payable in accordance withthe Priority of Payments and shall survive the discharge of this Indenture and Security Agreement and the resignation or removal of the Trustee. To the extent that the entity acting asTrustee is acting as Registrar, Calculation Agent, Income Note Paying Agent, Loan Agent, Collateral AgentTrustee, Authenticating Agent, Securities Intermediary or Custodian, the rights,privileges, immunities and indemnities set forth in this Article VI shall also apply to it acting ineach such capacity.
Corporate Trustee Required; Eligibility. There shall at all times beSection 6.7a Trustee hereunder which shall be an organization or entity organized and doing business underthe laws of the United States of America or of any state thereof, authorized under such laws toexercise corporate trust powers, having a combined capital and surplus of at leastU.S.$200,000,000, subject to supervision or examination by federal or state authority, having along-term debt rating of at least “Baa1” by Moody’s and having an office within the UnitedStates. If such organization or entity publishes reports of condition at least annually, pursuant tolaw or to the requirements of the aforesaid supervising or examining authority, then for thepurposes of this Section 6.7, the combined capital and surplus of such organization or entity shallbe deemed to be its combined capital and surplus as set forth in its most recent published reportof condition. If at any time the Trustee shall cease to be eligible in accordance with theprovisions of this Section 6.7, it shall resign immediately in the manner and with the effecthereinafter specified in this Article VI.
Resignation and Removal; Appointment of Successor. (a) NoSection 6.8resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to thisArticle VI shall become effective until the acceptance of appointment by the successor Trusteeunder Section 6.9.
The Trustee may resign at any time by giving written notice thereof to the(b)Co-Issuers, the Investment Manager, Collateral AgentTrustee, the Holders of the DebtNotes andeach Rating Agency not less than 60 days prior to such resignation. Upon receiving such noticeof resignation, the Co-Issuers shall promptly appoint a successor trustee or trustees satisfying therequirements of Section 6.7 by written instrument, in duplicate, executed by an AuthorizedOfficer of the Issuer and an Authorized Officer of the Co-Issuer, one copy of which shall bedelivered to the Trustee so resigning and one copy to the successor Trustee or Trustees, together
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with a copy to each Holder, the Collateral AgentTrustee and the Investment Manager; providedthat the Issuer shall provide prior written notice to the Rating Agencies of any such appointment;provided, further, that the Issuer shall not appoint such successor trustee or trustees without theconsent of a Majority of the Debt of each ClassControlling Class and a Majority of the Subordinated Notes or, at any time when an Event of Default shall have occurred and becontinuing or when a successor Trustee has been appointed pursuant to Section 6.8(d), by an Actof a Majority of the Controlling Class only unless (i) the Issuer gives ten days’ prior writtennotice to the Holders of such appointment and (ii) a Majority of the DebtNotes of each Class or,at any time when an Event of Default shall have occurred and be continuing or when a successorTrustee has been appointed pursuant to Section 6.8(d), a Majority of the Controlling Class do notprovide written notice to the Issuer objecting to such appointment (the failure of any suchMajority to provide such notice to the Issuer within ten days of receipt of notice of suchappointment from the Issuer being conclusively deemed to constitute hereunder consent to suchappointment and approval of such successor trustee or trustees). If no successor Trustee shallhave been appointed and an instrument of acceptance by a successor Trustee shall not have beendelivered to the Trustee within 30 days after the giving of such notice of resignation, theresigning Trustee or any Holder, on behalf of himself and all others similarly situated, maypetition any court of competent jurisdiction for the appointment of a successor Trustee satisfyingthe requirements of Section 6.7.
The Trustee may be removed at any time by Act of a Majority of each(c)Class of DebtNotes voting separately or, at any time when an Event of Default shall haveoccurred and be continuing by an Act of a Majority of the Controlling Class, delivered to theTrustee and to the Co-Issuers.
If at any time:(d)
the Trustee shall cease to be eligible under Section 6.7 and shall fail to(i)resign after written request therefor by the Co-Issuers or by a Majority of the ControllingClass or a Majority of each Class of DebtNotes, as applicable; or
the Trustee shall become incapable of acting or shall be adjudged as(ii)bankrupt or insolvent or a receiver or liquidator of the Trustee or of its property shall beappointed or any public officer shall take charge or control of the Trustee or of itsproperty or affairs for the purpose of rehabilitation, conservation or liquidation;
then, in any such case (subject to Section 6.8(a)), (A) the Co-Issuers, by Issuer Order, mayremove the Trustee, or (B) subject to Section 5.15, any Holder may, on behalf of himself and allothers similarly situated, petition any court of competent jurisdiction for the removal of theTrustee and the appointment of a successor Trustee.
If the Trustee shall be removed or become incapable of acting, or if a(e)vacancy shall occur in the office of the Trustee for any reason (other than resignation), theCo-Issuers, by Issuer Order, shall promptly appoint a successor Trustee; provided that suchsuccessor trustee shall be appointed only upon the written consent of a Majority of theSubordinated Notes. If the Co-Issuers shall fail to appoint a successor Trustee within thirty (30)days after such removal or incapability or the occurrence of such vacancy, a successor Trustee
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may be appointed by a Majority of the Controlling Class by written instrument delivered to theIssuer and the retiring Trustee with the prior written consent of a Majority of the Subordinated Notes. The successor Trustee so appointed shall, forthwith upon its acceptance of suchappointment, become the successor Trustee and supersede any successor Trustee proposed bythe Co-Issuers. If no successor Trustee shall have been so appointed by the Co-Issuers or aMajority of the Controlling Class (with the consent of a Majority of the Subordinated Notes) andshall have accepted appointment in the manner hereinafter provided, subject to Section 5.15, theretiring or removed Trustee may, or any Holder may, on behalf of himself and all otherssimilarly situated, petition any court of competent jurisdiction for the appointment of a successorTrustee.
The Co-Issuers shall give prompt notice of each resignation and each(f)removal of the Trustee and each appointment of a successor Trustee by mailing written notice ofsuch event by first class mail, postage prepaid, to the Investment Manager, to the Collateral AgentTrustee, to the Holders of the DebtNotes as their names and addresses appear in theRegister or the Credit Agreement, as applicable, and to each Rating Agency. Each notice shallinclude the name of the successor Trustee and the address of its Corporate Office. If theCo-Issuers fail to mail such notice within ten days after acceptance of appointment by thesuccessor Trustee, the successor Trustee shall cause such notice to be given at the expense of theCo-Issuers.
Any resignation or removal of the Trustee under this Section 6.8 shall be(g)an effective resignation or removal of the Bank in all capacities under this Indenture and Security Agreement (including as Collateral AgentTrustee), as Collateral Administrator underthe Collateral Administration Agreement, as Income Note Paying Agent under the Income NotePaying Agent Agreement and as Loan Agent under the Credit Agreement.
Acceptance of Appointment by Successor. Every successorSection 6.9Trustee appointed hereunder shall meet the requirements of Section 6.7 and shall execute,acknowledge and deliver to the Co-Issuers and the retiring Trustee an instrument accepting suchappointment. Upon delivery of the required instruments, the resignation or removal of theretiring Trustee shall become effective and such successor Trustee, without any further act, deedor conveyance, shall become vested with all the rights, powers, trusts, duties and obligations ofthe retiring Trustee; but, on request of the Co-Issuers or a Majority of any Class of DebtNotes orthe successor Trustee, such retiring Trustee shall, upon payment of its charges then unpaid,execute and deliver an instrument transferring to such successor Trustee all the rights, powersand trusts of the retiring Trustee, and shall duly assign, transfer and deliver to such successorTrustee all property and Money held by such retiring Trustee hereunder. Upon request of anysuch successor Trustee, the Co-Issuers shall execute any and all instruments for more fully andcertainly vesting in and confirming to such successor Trustee all such rights, powers and trusts.
Merger, Conversion, Consolidation or Succession to Business of Section 6.10Trustee. Any organization or entity into which the Trustee may be merged or converted or withwhich it may be consolidated, or any organization or entity resulting from any merger,conversion or consolidation to which the Trustee shall be a party, or any organization or entitysucceeding to all or substantially all of the corporate trust business of the Trustee, shall be thesuccessor of the Trustee hereunder; provided that such organization or entity shall be otherwise
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qualified and eligible under this Article VI, without the execution or filing of any paper or anyfurther act on the part of any of the parties hereto. In case any of the Notes hashave beenauthenticated, but not delivered, by the Trustee then in office, any successor by merger,conversion or consolidation to such authenticating Trustee may adopt such authentication anddeliver the Notes so authenticated with the same effect as if such successor Trustee had itselfauthenticated such Notes.
Co-Trustees. At any time or times, for the purpose of meeting theSection 6.11legal requirements of any jurisdiction in which any part of the Assets may at the time be located,the Co-Issuers and the Trustee shall have power to appoint one or more Persons to act asco-trustee (subject to the satisfaction of the Global Rating Agency Condition), jointly with theTrustee, of all or any part of the Assets, with the power to file such proofs of claim and take suchother actions pursuant to Section 5.6 and to make such claims and enforce such rights of actionon behalf of the Holders, as such Holders themselves may have the right to do, subject to theother provisions of this Section 6.11.
The Co-Issuers shall join with the Trustee in the execution, delivery andperformance of all instruments and agreements necessary or proper to appoint a co-trustee. If theCo-Issuers do not join in such appointment within 15 days after the receipt by them of a requestto do so, the Trustee shall have the power to make such appointment.
Should any written instrument from the Co-Issuers be required by any co-trusteeso appointed, more fully confirming to such co-trustee such property, title, right or power, anyand all such instruments shall, on request, be executed, acknowledged and delivered by theCo-Issuers. The Co-Issuers agree to pay (but only from and to the extent of the Assets), to theextent funds are available therefor under the Priority of Payments, any reasonable fees andexpenses in connection with such appointment.
Every co-trustee shall, to the extent permitted by law, but to such extent only, beappointed subject to the following terms:
the Notes shall be authenticated and delivered and all rights, powers,(a)duties and obligations hereunder in respect of the custody of securities, Cash and other personalproperty held by, or required to be deposited or pledged with, the Trustee hereunder, shall beexercised solely by the Trustee;
the rights, powers, duties and obligations hereby conferred or imposed(b)upon the Trustee in respect of any property covered by the appointment of a co-trustee shall beconferred or imposed upon and exercised or performed by the Trustee or by the Trustee and suchco-trustee jointly as shall be provided in the instrument appointing such co-trustee;
the Trustee at any time, by an instrument in writing executed by it, with(c)the concurrence of the Co-Issuers evidenced by an Issuer Order, may accept the resignation of orremove any co-trustee appointed under this Section 6.11, and in case an Event of Default hasoccurred and is continuing, the Trustee shall have the power to accept the resignation of, orremove, any such co-trustee without the concurrence of the Co-Issuers. A successor to anyco-trustee so resigned or removed may be appointed in the manner provided in this Section 6.11;
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no co-trustee hereunder shall be personally liable by reason of any act or(d)omission of the Trustee hereunder;
the Trustee shall not be liable by reason of any act or omission of a(e)co-trustee; and
any Act of Holders delivered to the Trustee shall be deemed to have been(f)delivered to each co-trustee.
Authenticating Agents. Upon the request of the Co-Issuers, theSection 6.12Trustee shall, and if the Trustee so chooses the Trustee may, appoint one or more AuthenticatingAgents with power to act on its behalf and subject to its direction in the authentication of Notesin connection with issuance, transfers and exchanges under Sections 2.4, 2.5, 2.6, 2.7 and 8.5, asfully to all intents and purposes as though each such Authenticating Agent had been expresslyauthorized by such Sections to authenticate such Notes. For all purposes of this Indenture and Security Agreement, the authentication of Notes by an Authenticating Agent pursuant to thisSection 6.12 shall be deemed to be the authentication of Notes by the Trustee.
Any corporation into which any Authenticating Agent may be merged orconverted or with which it may be consolidated, or any corporation resulting from any merger,consolidation or conversion to which any Authenticating Agent shall be a party, or anycorporation succeeding to the corporate trust business of any Authenticating Agent, shall be thesuccessor of such Authenticating Agent hereunder, without the execution or filing of any furtheract on the part of the parties hereto or such Authenticating Agent or such successor corporation.
Any Authenticating Agent may at any time resign by giving written notice ofresignation to the Trustee and the Issuer. The Trustee may at any time terminate the agency ofany Authenticating Agent by giving written notice of termination to such Authenticating Agentand the Co-Issuers. Upon receiving such notice of resignation or upon such a termination, theTrustee shall, upon the written request of the Issuer, promptly appoint a successor AuthenticatingAgent and shall give written notice of such appointment to the Co-Issuers.
Unless the Authenticating Agent is also the same entity as the Trustee, the Issueragrees to pay to each Authenticating Agent from time to time reasonable compensation for itsservices, and reimbursement for its reasonable expenses relating thereto as an AdministrativeExpense under Section 11.1. The provisions of Sections 2.9, 6.3 and 6.4 shall be applicable toany Authenticating Agent.
Representations and Warranties of the Bank. The Bank herebySection 6.13represents and warrants as follows:
Organization. The Bank has been duly organized and is validly existing(a)as a national banking association under the laws of the United States of America and has thepower to conduct its business and affairs as a trustee.
Authorization; Binding Obligations. The Bank has the corporate power(b)and authority to perform the duties and obligations of trustee under this Indenture and Security
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Agreement. The Bank has taken all necessary corporate action to authorize the execution,delivery and performance of this Indenture and Security Agreement, and all of the documentsrequired to be executed by the Bank pursuant hereto. Upon execution and delivery by the Bank,this Indenture and Security Agreement shall constitute the legal, valid and binding obligation ofthe Bank enforceable against the Bank in accordance with its terms, subject to applicablebankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium, liquidation andsimilar laws affecting the rights of creditors, and subject to equitable principles includingwithout limitation concepts of materiality, reasonableness, good faith and fair dealing (whetherenforcement is sought in a legal or equitable Proceeding), and except that certain of suchobligations may be enforceable solely against the Assets.
Eligibility. The Bank is eligible under Section 6.7 to serve as Trustee(c)hereunder.
No Conflict. Neither the execution, delivery and performance of this(d)Indenture and Security Agreement, nor the consummation of the transactions contemplated bythis Indenture and Security Agreement, is prohibited by, or requires the Bank to obtain anyconsent, authorization, approval or registration with any United States federal agency or othergovernmental body under any United States federal regulation or law having jurisdiction overthe banking or trust powers of the Bank.
Communication with Rating Agencies. Any writtenSection 6.14communication, including any confirmation, from a Rating Agency provided for or required tobe obtained by the Trustee hereunder shall be sufficient in each case when such communicationor confirmation is received by the Trustee, including by electronic message, facsimile, pressrelease, posting to the applicable Rating Agency’s website or other means then consideredindustry standard; provided, however, that the Trustee shall have no obligation to monitor theRating Agency website. For the avoidance of doubt, no written communication given byMoody’s under this Section 6.14 shall be deemed to satisfy the Moody’s Rating Condition unlesssuch communication is provided by Moody’s specifically in satisfaction of the Moody’s RatingCondition.
The Collateral AgentTrustee.Section 6.15
General. Each of the Holders by acceptance of the DebtNotes hereby(a)designates and appoints the Collateral AgentTrustee as its agent (or, if applicable, as securitytrustee in accordance with the terms of any security trustee deed to be entered into in connectionwith the herewith) under this Indenture and Security Agreement and the Securities AccountControl Agreement and each of the Holders by acceptance of the DebtNotes hereby irrevocablyauthorizes the Collateral AgentTrustee to take such action on its behalf under the provisions ofthis Indenture and Security Agreement and the Securities Account Control Agreement and toexercise such powers and perform such duties as are expressly delegated to the Collateral AgentTrustee by the terms of this Indenture and Security Agreement, together with such powersas are reasonably incidental thereto. The provisions of this Section 6.15 are solely for the benefitof the Collateral AgentTrustee and none of the Holders nor any of the Co-Issuers shall have anyrights as a third-party beneficiary of any of the provisions contained herein. Notwithstandingany provision to the contrary contained elsewhere in this Indenture and Security Agreement, the
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Collateral AgentTrustee shall not have any duties or responsibilities, except those expressly setforth herein, in the Securities Account Control Agreement or the Credit Agreement. TheCollateral AgentTrustee shall not have or be deemed to have any fiduciary relationship with theTrustee, any Holder or any Issuer, and no implied covenants, functions, responsibilities, duties,obligations or liabilities shall be read into this Indenture and Security Agreement or otherwiseexist against the Collateral AgentTrustee. Without limiting the generality of the foregoingsentence, the use of the term “agent” in this Indenture and Security Agreement with reference tothe Collateral AgentTrustee is not intended to connote any fiduciary or other implied (or express)obligations arising under agency doctrine of any applicable law. Instead, such term is usedmerely as a matter of market custom, and is intended to create or reflect only an administrativerelationship between independent contracting parties.
The Collateral AgentTrustee is authorized and directed to (i) enter into thisIndenture and Security Agreement, the Credit Agreement and the Securities Account ControlAgreement, (ii) bind the Holders on the terms as set forth in this Indenture and Security Agreement and (iii) perform and observe its obligations under this Indenture and Security Agreement, the Credit Agreement and the Securities Account Control Agreement.
The Collateral AgentTrustee is each Secured Party’s agent for the purpose ofperfecting the Secured Party’s security interest in assets which, in accordance with Article 9 ofthe Uniform Commercial Code (or other personal property security legislation) can be perfectedonly by possession. Should the Trustee obtain possession of any such Assets, upon request fromthe Co-Issuers, the Trustee shall notify the Collateral AgentTrustee thereof and, promptly uponthe Collateral AgentTrustee’s request therefor, shall deliver such Assets to the Collateral AgentTrustee or otherwise deal with such Assets in accordance with the Collateral AgentTrustee’s instructions.
Certain Duties and Responsibilities of the Collateral AgentTrustee. At all(b)times:
the Collateral AgentTrustee undertakes to perform such duties and only(i)such duties as are specifically set forth in this Indenture and Security Agreement, and noimplied covenants or obligations shall be read into this Indenture and Security Agreementagainst the Collateral AgentTrustee; and
in the absence of bad faith on its part, the Collateral AgentTrustee may(ii)conclusively rely, as to the truth of the statements and the correctness of the opinionsexpressed therein, upon certificates or opinions furnished to the Collateral AgentTrusteeand conforming to the requirements of this Indenture and Security Agreement; providedthat in the case of any such certificates or opinions which by any provision hereof arespecifically required to be furnished to the Collateral Agent, the Collateral AgentTrusteeshall be under a duty to examine the same to determine whether or not they substantiallyconform on their face to the requirements of this Indenture and Security Agreement andshall promptly, but in any event within three Business Days in the case of an Officer’scertificate furnished by the Investment Manager, notify the party delivering the same ifsuch certificate or opinion does not conform. If a corrected form shall not have been
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delivered to the Collateral AgentTrustee within fifteen days after such notice from theCollateral Agent, the Collateral AgentTrustee shall so notify the Holders of DebtNotes.
The Collateral AgentTrustee shall, prior to the receipt of directions, if any,(iii)from a Majority of the Controlling Class, exercise such of the rights and powers vested init by this Indenture and Security Agreement, and use the same degree of care and skill inits exercise, as the Bank would exercise or use under the circumstances in the conduct ofthe Bank’s activities in transactions in which it serves as a collateral agentTrustee, asmore particularly described in Section 6.15(a).
No provision of this Indenture and Security Agreement shall be construed(iv)to relieve the Collateral AgentTrustee from liability for its own grossly negligent action,its own grossly negligent failure to act, or its own willful misconduct or bad faith, exceptthat:
this subsection shall not be construed to limit the effect of(A)subsection (a) of this Section 6.15;
the Collateral AgentTrustee shall not be liable for any error of(B)judgment made in good faith by a Bank Officer, unless it shall be proven that theCollateral AgentTrustee was grossly negligent in ascertaining the pertinent facts;
the Collateral AgentTrustee shall not be liable with respect to any(C)action taken or omitted to be taken by it in good faith in accordance with thedirection of the Issuer or the Co-Issuer or the Investment Manager in accordancewith this Indenture and Security Agreement, the Credit Agreement or theSecurities Account Control Agreement and/or a Majority (or such otherpercentage as may be required by the terms hereof) of the Controlling Class (orother Class if required or permitted by the terms hereof), relating to the time,method and place of conducting any Proceeding for any remedy available to theCollateral AgentTrustee, or exercising any trust or power conferred upon theCollateral AgentTrustee, under this Indenture and Security Agreement;
no provision of this Indenture and Security Agreement shall(D)require the Collateral AgentTrustee to expend or risk its own funds or otherwiseincur any financial liability in the performance of any of its duties hereunder, orin the exercise of any of its rights or powers contemplated hereunder, if it shallhave reasonable grounds for believing that repayment of such funds or indemnitysatisfactory to it against such risk or liability is not reasonably assured to it unlesssuch risk or liability relates to its ordinary services; and
in no event shall the Collateral AgentTrustee be liable for special, indirect,(v)punitive or consequential loss or damage of any kind whatsoever (including but notlimited to lost profits) even if the Collateral AgentTrustee has been advised of thelikelihood of such damages and regardless of the form of such action.
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For all purposes under this Indenture and Security Agreement, the(vi)Collateral AgentTrustee shall not be deemed to have notice or knowledge of any Defaultor Event of Default described in Section 5.1(c), (d), (f), or (g) or any other matter unlessa Bank Officer assigned to and working in the Corporate Office has actual knowledgethereof or unless written notice of any event which is in fact such an Event of Default orDefault or other matter, as the case may be, is received by the Collateral AgentTrustee atthe Corporate Office, and such notice references the DebtNotes generally, the Issuer, theCo-Issuer, the Assets or this Indenture and Security Agreement. For purposes ofdetermining the Collateral AgentTrustee’s responsibility and liability hereunder,whenever reference is made in this Indenture and Security Agreement to such an Event ofDefault or a Default, such reference shall be construed to refer only to such an Event ofDefault or Default of which the Collateral AgentTrustee is deemed to have notice asdescribed in this Section 6.15.
Whether or not therein expressly so provided, every provision of this(vii)Indenture and Security Agreement relating to the conduct or affecting the liability of oraffording protection to the Collateral AgentTrustee shall be subject to the provisions ofthis Section 6.15.
In addition to its other obligations set forth herein, the Collateral (viii)AgentTrustee shall provide any information actually in its possession to the InvestmentManager promptly after the Investment Manager’s reasonable request therefor providedthat the Collateral AgentTrustee shall not be obligated to provide any information that itmay be restricted from doing so by legal, regulatory or contractual reasons.
The Collateral AgentTrustee shall, upon reasonable (but no less than three(ix)Business Days’) prior written notice to the Collateral AgentTrustee, permit anyrepresentative of a Holder of DebtNotes, during the Collateral AgentTrustee’s normalbusiness hours, to examine all books of account, records, reports and other papers of theCollateral AgentTrustee (other than items protected by attorney-client privilege) relatingto the DebtNotes and to make copies and extracts therefrom (the reasonableout-of-pocket expenses incurred in making any such copies or extracts to be reimbursedto the Collateral AgentTrustee by such Holder).
Certain Rights of Collateral AgentTrustee. Except as otherwise provided(c)in Section 6.15(a):
the Collateral AgentTrustee may conclusively rely and shall be fully(i)protected in acting or refraining from acting upon any resolution, certificate, statement,instrument, opinion, report, including any Accountants Report, notice, request, direction,consent, order, note or other paper or document believed by it to be genuine and to havebeen signed or presented by the proper party or parties;
any direction of the Issuer or the Co-Issuer mentioned herein shall be(ii)sufficiently evidenced by an Issuer Order;
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whenever in the administration of this Indenture and Security Agreement (iii)the Collateral Agentthe Trustee shall (i) deem it desirable that a matter be proved orestablished prior to taking, suffering or omitting any action hereunder, the Collateral AgentTrustee (unless other evidence be herein specifically prescribed) may, in theabsence of bad faith on its part, rely upon an Officer’s certificate or Issuer Order, or (ii)be required to determine the value of any Assets or funds hereunder or the cash flowsprojected to be received therefrom, the Collateral AgentTrustee may, in the absence ofbad faith on its part, rely on reports of nationally recognized accountants (which may ormay not be the Independent accountants appointed by the Issuer pursuant to Section 10.8(a), investment bankers or other Persons qualified to provide the informationrequired to make such determination, including nationally recognized dealers insecurities of the type being valued and securities quotation services;
as a condition to the taking or omitting of any action by it hereunder, the(iv)Collateral AgentTrustee may consult with counsel and the advice of such counsel or anyOpinion of Counsel shall be full and complete authorization and protection in respect ofany action taken or omitted by it hereunder in good faith and in reliance thereon;
the Collateral AgentTrustee shall be under no obligation to exercise,(v)enforce or to honor any of the rights or powers vested in it by this Indenture and Security Agreement at the request or direction of any of the Holders pursuant to this Indenture and Security Agreement, unless such Holders shall have provided to the Collateral AgentTrustee security or indemnity reasonably satisfactory to it against the costs,expenses (including reasonable attorneys’ fees and expenses) and liabilities which mightreasonably be incurred by it in compliance with such request or direction. The Collateral AgentTrustee shall in all cases be fully protected in acting, or in refraining from acting,under this Indenture and Security Agreement or any other Transaction Document inaccordance with a request or consent of Holders (or such other percentages of theHolders expressly specified in this Indenture and Security Agreement or suchTransaction Document with respect to a particular matter) and such request and anyaction taken or failure to act pursuant thereto shall be binding upon all of the Holders.
the Collateral AgentTrustee shall not be bound to make any investigation(vi)into the facts or matters stated in any resolution, certificate, statement, instrument,opinion, report, notice, request, direction, consent, order, note or other paper ordocument, but the Collateral AgentTrustee, in its discretion, may, and upon the writtendirection of a Majority of the Controlling Class or of a Rating Agency shall (subject tothe right hereunder to be satisfactorily indemnified), make such further inquiry orinvestigation into such facts or matters as it may see fit or as it shall be directed, and theCollateral AgentTrustee shall be entitled, at the expense of the Issuer, on reasonable priornotice to the Co-Issuers and the Investment Manager, to examine the books and recordsrelating to the DebtNotes and the Assets, personally or by agent or attorney, during theCo-Issuers’ or the Investment Manager’s normal business hours; provided that theCollateral AgentTrustee shall, and shall cause its agents to, hold in confidence all suchinformation, except (i) to the extent disclosure may be required by law or by anyregulatory, administrative or governmental authority and (ii) to the extent that the
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Collateral AgentTrustee, in its sole judgment, may determine that such disclosure isconsistent with its obligations hereunder; provided, further, that the Collateral AgentTrustee may disclose on a confidential basis any such information to its agents,attorneys and auditors in connection with the performance of its responsibilitieshereunder;
the Collateral AgentTrustee may execute any of the trusts or powers(vii)hereunder or perform any duties hereunder either directly or by or through agents orattorneys; provided that the Collateral AgentTrustee shall not be responsible for anywillful misconduct, bad faith or gross negligence on the part of any Affiliated agent orAffiliated attorney appointed with due care by it hereunder;
the Collateral AgentTrustee shall not be liable for any action it takes,(viii)suffers or omits to take that it reasonably believes to be authorized or within its rights orpowers or within its discretion hereunder, other than acts or omissions constitutingwillful misconduct or gross negligence of the Collateral AgentTrustee’s duties hereunder;
nothing herein shall be construed to impose an obligation on the part of(ix)the Collateral AgentTrustee to recalculate, evaluate, verify or independently determinethe accuracy of any report, certificate or information received from the Issuer orInvestment Manager and all calculations made by the Collateral AgentTrustee in itsrespective roles hereunder shall (in the absence of manifest error) be final and binding onall parties;
to the extent any defined term hereunder, or any calculation required to be(x)made or determined by the Collateral AgentTrustee hereunder, is dependent upon ordefined by reference to GAAP, the Collateral AgentTrustee shall be entitled to requestand receive (and conclusively rely upon) instruction from the Issuer or from a firm ofnationally recognized accountants (which may or may not be the Independentaccountants appointed by the Issuer pursuant to Section 10.8(a)) and in the absence of itsreceipt of timely instruction therefrom, shall be entitled to obtain from an Independentaccountant at the expense of the Issuer as to the application of GAAP in such connection,in any instance;
to the extent permitted by applicable law, the Collateral AgentTrustee(xi)shall not be required to give any bond or surety in respect of the execution of thisIndenture and Security Agreement or otherwise;
the Collateral AgentTrustee shall not be deemed to have notice or(xii)knowledge of any matter unless a Bank Officer has actual knowledge thereof or unlesswritten notice thereof is received by the Collateral AgentTrustee at the Corporate Officeand such notice references the DebtNotes generally, the Issuer, the Co-Issuer or thisIndenture and Security Agreement;
the permissive rights of the Collateral AgentTrustee to take or refrain from(xiii)taking any actions enumerated in this Indenture and Security Agreement shall not be
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construed as a duty and the Collateral AgentTrustee shall not be answerable for otherthan its respective gross negligence, bad faith or willful misconduct;
the Collateral AgentTrustee shall not be responsible for delays or failures(xiv)in performance resulting from acts beyond its control, including, without limitation,strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances,nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions ofutilities, communications or computer (software and hardware) services, it beingunderstood that the Trustee shall use reasonable best efforts which are consistent withaccepted practices in the banking industry to maintain performance and, if necessary,resume performance as soon as practicable under the circumstances;
in making or disposing of any investment permitted by this Indenture and (xv)Security Agreement, the Collateral AgentTrustee is authorized to deal with itself (in itsindividual capacity) or with any one or more of its Affiliates, whether it or such Affiliateis acting as a subagent of the Collateral AgentTrustee or for any third person or dealingas principal for its own account. If otherwise qualified, obligations of the Bank or any ofits Affiliates shall qualify as Eligible Investments hereunder;
the Collateral AgentTrustee or its Affiliates are permitted to receive(xvi)additional compensation that could be deemed to be in the Collateral AgentTrustee’seconomic self-interest for (i) serving as investment adviser, administrator, shareholder,servicing agent, custodian or sub-custodian with respect to certain of the EligibleInvestments, (ii) using Affiliates to effect transactions in certain Eligible Investments and(iii) effecting transactions in certain Eligible Investments. Such compensation is notpayable or reimbursable under Section 6.6;
to help fight the funding of terrorism and money laundering activities, the(xvii)Collateral AgentTrustee may obtain, verify, and record information that identifiesindividuals or entities that establish a relationship or open an account with the Collateral AgentTrustee. The Collateral AgentTrustee may ask for the name, address, taxidentification number and other information that will allow the Collateral AgentTrusteeto identify the individual or entity who is establishing the relationship or opening theaccount. The Collateral AgentTrustee may also ask for formation documents such asarticles of incorporation, an offering memorandum, or other identifying documents to beprovided. In accordance with the Gambling Act, the Issuer may not, and shall not directthe Collateral AgentTrustee to, use the Accounts or other Bank facilities in the UnitedStates to process “restricted transactions” as such term is defined in U.S. 31 CFR Section132.2(y). Therefore, neither the Issuer nor any person who has an ownership interest inor control over the Accounts may use it to process or facilitate payments for prohibitedinternet gambling transactions;
the Collateral AgentTrustee shall not be liable for the actions or omissions(xviii)of, or any inaccuracies in the record of, the Investment Manager, any Clearing Agency,the Issuer, the Co-Issuer, the Income Note Paying Agent, Income Note Registrar anyAuthenticating Agent and without limiting the foregoing, the Collateral AgentTrusteeshall not be under any obligation to monitor, evaluate or verify compliance by the
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Investment Manager with the terms hereof or the Investment Management Agreement, orto verify or independently determine the accuracy of information received by it from theInvestment Manager (or from any selling institution, agent bank, trustee or similarsource) with respect to the Assets. the Collateral AgentTrustee shall not be responsible orliable for the actions or omissions of, or any inaccuracies in the records of, any agent,custodian, transfer agent, paying agent, or calculation agent, clearing agency, loansyndication, administrative or similar agent, Depositary, Euroclear or Clearstream, or forthe acts or omissions of the Information Agent;
the Collateral AgentTrustee shall be entitled to conclusively rely on the(xix)Investment Manager with respect to whether or not a Collateral Obligation meets thecriteria specified in the definition thereof and for the characterization, classification,designation or categorization of each Collateral Obligation to the extent suchcharacterization, classification, designation or categorization is subjective or judgmentalin nature or based on information not readily available to the Collateral AgentTrustee;
in the event the Bank is also acting in the capacity of the Income Note(xx)Paying Agent, Trustee, Loan Agent, Income Note Registrar, Registrar, Transfer Agent,Custodian, Calculation Agent or Securities Intermediary, the rights, protections, benefits,immunities and indemnities afforded to the Collateral AgentTrustee pursuant to thisArticle VI and under the other Transaction Documents, as applicable, shall also beafforded to the Bank acting in such capacities;
the Collateral AgentTrustee shall have no duty (i) to see to any recording,(xxi)filing, or depositing of this Indenture and Security Agreement or any supplementalindenture and security agreement or any financing statement or continuation statementevidencing a security interest, or to see to the maintenance of any such recording, filingor depositing or to any rerecording, refiling or redepositing of any thereof or (ii) tomaintain any insurance;
notwithstanding any term hereof to the contrary, the Collateral (xxii)AgentTrustee shall be under no obligation to evaluate the sufficiency of the documents orinstruments Delivered to it by or on behalf of the Issuer in connection with the Grant bythe Issuer to the Collateral AgentTrustee of any item constituting the Assets or otherwise,or in that regard to examine any Collateral Obligations, in order to determine compliancewith applicable requirements of or restrictions on transfer imposed by the documentationunderlying such Collateral Obligations nor to re-register or otherwise change theregistration or form in which the Collateral Obligations are Delivered, transferred,assigned or pledged by the Issuer to the Collateral AgentTrustee hereunder;
the Collateral AgentTrustee shall not have any obligation to determine: (a)(xxiii)if a Collateral Obligation meets the criteria specified in the definition thereof or (b) if theconditions specified in the definition of “Deliver” have been complied with;
[Reserved];(xxiv)
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The Collateral AgentTrustee shall not be required to qualify in any(xxv)jurisdiction in which it is not presently qualified to perform its obligations as Collateral AgentTrustee.
Notice of Default. As soon as reasonably practicable (and in no event(d)later than two Business Days) after the occurrence of any Default actually known to a BankOfficer of the Collateral AgentTrustee or after any declaration of acceleration has been made ordelivered to the Collateral AgentTrustee pursuant to Section 5.2, the Collateral AgentTrusteeshall give notice to the Co-Issuers, the Investment Manager, DTC, each Rating Agency, eachHedge Counterparty, the Income Note Paying Agent, the Loan Agent (who shall forward to the Class A Lenders) and all Holders, as their names and addresses appear on the Register, and to the Irish Stock Exchange, for so long as any Class of Notes is listed on the Irish Stock Exchangeand so long as the guidelines of such exchange so require, of all Defaults hereunder actuallyknown to the Bank Officer of the Collateral AgentTrustee, unless such Default shall have beencured or waived.
Compensation and Reimbursement of Collateral AgentTrustee. The Issuer(e)agrees:
to pay the Collateral AgentTrustee on each Payment Date reasonable(i)compensation as set forth in a separate fee schedule dated on or before the Closing Datebetween the Collateral AgentTrustee and the Issuer for all services rendered by ithereunder (which compensation shall not be limited by any provision of law in regard tothe compensation of a trustee of an express trust);
except as otherwise expressly provided herein, to reimburse the Collateral (ii)AgentTrustee in a timely manner upon its request for all reasonable expenses,disbursements and advances incurred or made by the Collateral AgentTrustee inaccordance with any provision of this Indenture and Security Agreement, the Credit Agreement or any other Transaction Document (including, without limitation, securitiestransaction charges and the reasonable compensation and expenses and disbursements ofits agents and legal counsel and of any accounting firm or investment banking firmemployed by the Collateral AgentTrustee pursuant to Section 5.4, 5.5 or 10.7 or any otherterm of this Indenture and Security Agreement, the Credit Agreement or any otherTransaction Document, except any such expense, disbursement or advance as may beattributable to its gross negligence, willful misconduct or bad faith);
to indemnify the Collateral AgentTrustee and its Officers, directors,(iii)employees and agents for, and to hold them harmless against, any loss, liability orexpense (including reasonable counsel’s fees and expenses) incurred without grossnegligence, willful misconduct or bad faith, as determined by a court of competentjurisdiction in a final, non-appealable judgment, on their part, arising out of or inconnection with the acceptance or administration of this Indenture and Security Agreement and the transactions contemplated thereby and any other TransactionDocument, including the costs and expenses of defending themselves (includingreasonable attorney’s fees and costs) against any claim or liability in connection with the
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exercise or performance of any of their powers or duties hereunder and under any otherdocument related hereto; and
to pay the Collateral AgentTrustee reasonable additional compensation(iv)together with its expenses (including reasonable counsel fees) for any collection actiontaken pursuant to Section 6.15(g) or the exercise or enforcement of remedies pursuant toArticle V.
The Collateral AgentTrustee shall receive amounts pursuant to this Section 6.15(e) in accordance with the Priority of Payments but only to the extent that funds areavailable for the payment thereof. Subject to Section 6.15(k), the Collateral AgentTrustee shallcontinue to serve as Collateral AgentTrustee under this Indenture and Security Agreement and the Credit Agreement notwithstanding the fact that the Collateral AgentTrustee shall not havereceived amounts due it hereunder; provided that nothing herein shall impair or affect theCollateral AgentTrustee’s rights under Section 6.15(k). No direction by the Holders of theDebtNotes shall affect the right of the Collateral AgentTrustee to collect amounts owed to itunder this Indenture and Security Agreement. If on any date when a fee or expense shall bepayable to the Collateral AgentTrustee pursuant to this Indenture and Security Agreementinsufficient funds are available for the payment thereof, any portion of a fee not so paid shall bedeferred and payable on such later date on which a fee or expense shall be payable and sufficientfunds are available therefor. The Issuer’s obligations under this Section 6.15(e) shall be securedby the lien of this Indenture and Security Agreement and shall survive the termination of thisIndenture and Security Agreement and the resignation or removal of the Collateral AgentTrusteepursuant to Section 6.15(k). The Collateral AgentTrustee hereby agrees not to cause the filing ofa petition in bankruptcy for the non-payment to the Collateral AgentTrustee of any amountsprovided by this Section 6.15(f) until at least one year and one day, or if longer the applicablepreference period then in effect, after the payment in full of all DebtNotes issued and/or incurredunder this Indenture and Security Agreement or the Credit Agreement, as applicable. Nothing inthis Section 6.15(e) shall preclude the Collateral AgentTrustee from (i) exercising its rights as asecured or unsecured creditor in any Proceeding involving the Issuer or the Co-Issuer (other thanany Proceeding filed with or commenced by the Collateral AgentTrustee) or (ii) while an Eventof Default is continuing, commencing against the Issuer or the Co-Issuer or any of theirrespective properties any legal action which is not a bankruptcy, reorganization, arrangement,insolvency, moratorium or liquidation Proceeding; provided that any recovery of any amountreceived by the Collateral AgentTrustee under the preceding clause (i) or (ii) shall be distributedin accordance with the Priority of Payments.
Certain Duties of Collateral AgentTrustee Related to Delayed Payment of (f)Proceeds. In the event that in any month the Collateral AgentTrustee receives notice from theInvestment Manager or the Collateral Administrator that a payment has not been received withrespect to any Pledged Obligation on its Due Date, (a) the Collateral AgentTrustee shallpromptly notify the Issuer and the Investment Manager in writing or electronically and (b) unlesswithin three Business Days (or the end of the applicable grace period for such payment, iflonger) after such notice such payment shall have been received by the Collateral AgentTrustee,or the Issuer, in its absolute discretion (but only to the extent permitted by Section 10.2(a)), shallhave made provision for such payment satisfactory to the Collateral AgentTrustee in accordancewith Section 10.2(a), the Collateral AgentTrustee shall request the issuer of such Pledged
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Obligation, the collateral agentTrustee under the related Underlying Instrument or paying agentdesignated by either of them, as the case may be, to make such payment as soon as practicableafter such request but in no event later than three Business Days after the date of such request.In the event that such payment is not made within such time period, the Collateral AgentTrustee,subject to the provisions of clause (iv) of Section 6.1(c), shall take such action as the InvestmentManager shall direct in writing. Any such action shall be without prejudice to any right to claima Default or Event of Default under this Indenture and Security Agreement. In the event that theIssuer or the Investment Manager requests a release of a Pledged Obligation and/or delivers anadditional Collateral Obligation in connection with any such action under the InvestmentManagement Agreement, such release and/or substitution shall be subject to Section 10.7 andArticle XII of this Indenture and Security Agreement, as the case may be. Notwithstanding anyother provision hereof, the Collateral AgentTrustee shall deliver to the Issuer or its designee anypayment with respect to any Pledged Obligation or any additional Collateral Obligation receivedafter the Due Date thereof to the extent the Issuer previously made provisions for such paymentsatisfactory to the Collateral AgentTrustee in accordance with this Section 6.15(g) and suchpayment shall not be deemed part of the Assets.
Representative for Rated Holders of the DebtNotes Only; Agent for each (g)Hedge Counterparty and the Holders of the Subordinated Notes. With respect to the securityinterest created hereunder, the delivery of any Asset to the Collateral AgentTrustee is to theCollateral AgentTrustee as representative of the Holders of Rated DebtNotes and agent for eachother Secured Party and the Holders of the Subordinated Notes. In furtherance of the foregoing,the possession by the Collateral AgentTrustee of any Asset, the endorsement to or registration inthe name of the Collateral AgentTrustee of any Asset (including without limitation asEntitlement Holder of the Custodial Account) are all undertaken by the Collateral AgentTrusteein its capacity as representative of the Holders of Rated DebtNotes and agent for each otherSecured Party and the Holders of the Subordinated Notes.
Withholding. If any withholding tax is imposed on the Issuer’s payment(h)(or allocations) under the DebtNotes to any Holder, such tax shall reduce the amount otherwisedistributable to such Holder. The Collateral AgentTrustee or any Paying Agent is herebyauthorized and directed to retain from amounts otherwise distributable to any Holder sufficientfunds for the payment of any tax that is legally owed by the Issuer (but such authorization shallnot prevent the Collateral AgentTrustee or such Paying Agent from contesting any such tax inappropriate proceedings and withholding payment of such tax, if permitted by law, pending theoutcome of such proceedings). The amount of any withholding tax imposed with respect to anyHolder shall be treated as cash distributed to such Holder at the time it is withheld by theCollateral AgentTrustee or any Paying Agent and remitted to the appropriate taxing authority. Ifthere is a possibility that withholding tax is payable with respect to a distribution and theCollateral AgentTrustee or any Paying Agent has not received documentation from such Holdershowing an exemption from withholding, the Collateral AgentTrustee or such Paying Agent shallwithhold such amounts in accordance with this Section 6.15(h). If any Holder wishes to applyfor a refund of any such withholding tax, the Collateral AgentTrustee or such Paying Agent shallreasonably cooperate with such Holder in making such claim so long as such Holder agrees toreimburse the Collateral AgentTrustee or any Paying Agent for any out-of-pocket expensesincurred. Nothing herein shall impose an obligation on the part of the Collateral AgentTrustee or
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the Income Note Paying Agent to determine the amount of any tax or withholding obligation onthe part of the Issuer or in respect of the DebtNotes.
Communication with Rating Agencies. Any written communication,(i)including any confirmation, from a Rating Agency provided for or required to be obtained by theCollateral AgentTrustee hereunder shall be sufficient in each case when such communication orconfirmation is received by the Collateral AgentTrustee, including by electronic message,facsimile, press release, posting to the applicable Rating Agency’s website or other means thenconsidered industry standard. For the avoidance of doubt, no written communication given byMoody’s under this Section 6.15(i) shall be deemed to satisfy the Moody’s Rating Conditionunless such communication is provided by Moody’s specifically in satisfaction of the Moody’sRating Condition.
Corporate Collateral AgentTrustee Required; Eligibility. There shall at all(j)times be a Collateral AgentTrustee hereunder which shall be an organization or entity organizedand doing business under the laws of the United States of America or of any state thereof,authorized under such laws to exercise corporate trust powers, having a combined capital andsurplus of at least U.S.$200,000,000, subject to supervision or examination by federal or stateauthority, having a long-term debt rating of at least “Baa1” by Moody’s and having an officewithin the United States. If such organization or entity publishes reports of condition at leastannually, pursuant to law or to the requirements of the aforesaid supervising or examiningauthority, then for the purposes of this Section 6.15(j), the combined capital and surplus of suchorganization or entity shall be deemed to be its combined capital and surplus as set forth in itsmost recent published report of condition. If at any time the Collateral AgentTrustee shall ceaseto be eligible in accordance with the provisions of this Section 6.15(j), it shall resignimmediately in the manner and with the effect hereinafter specified in this Section 6.15.
Resignation and Removal; Appointment of Successor. (i) No resignation(k)or removal of the Collateral AgentTrustee and no appointment of a successor Collateral AgentTrustee pursuant to this Section 6.15 shall become effective until the acceptance ofappointment by the successor Collateral AgentTrustee under this Section 6.15(k). Theindemnification in favor of the Collateral AgentTrustee in Section 6.15(e) hereof shall surviveany resignation or removal (to the extent of any indemnified liabilities, costs, expenses and otheramounts arising or incurred prior to, or arising out of actions or omissions occurring prior tosuch resignation or removal).
The Collateral AgentTrustee may resign at any time by giving written(ii)notice thereof to the Co-Issuers, the Investment Manager, the Trustee, the Holders of theDebtNotes and each Rating Agency not less than 60 days prior to such resignation. Uponreceiving such notice of resignation, the Co-Issuers shall promptly appoint a successorcollateral agent or collateral agentsTrustee or Trustees satisfying the requirements ofSection 6.15(j) by Issuer Order, in duplicate, executed by an Authorized Officer of theIssuer and an Authorized Officer of the Co-Issuer, one copy of which shall be deliveredto the Collateral AgentTrustee so resigning and one copy to the successor Collateral AgentTrustee, together with a copy to each Holder, the Trustee and the InvestmentManager; provided that the Issuer shall provide prior written notice to the RatingAgencies of any such appointment; provided, further, that the Issuer shall not appoint
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such successor collateral agentTrustee without the consent of a Majority of theDebtNotes of each Class or, at any time when an Event of Default shall have occurredand be continuing or when a successor Collateral AgentTrustee has been appointedpursuant to Section 6.15(k)(v), by an Act of a Majority of the Controlling Class and a Majority of the Subordinated Notes unless (i) the Issuer gives ten days’ prior writtennotice to the Holders of such appointment and (ii) a Majority of the DebtNotes of eachClass or, at any time when an Event of Default shall have occurred and be continuing orwhen a successor Collateral AgentTrustee has been appointed pursuant to Section 6.15(k)(v), a Majority of the Controlling Class and a Majority of the Subordinated Notesdo not provide written notice to the Issuer objecting to such appointment (the failure ofany such Majority to provide such notice to the Issuer within ten days of receipt of noticeof such appointment from the Issuer being conclusively deemed to constitute hereunderconsent to such appointment and approval of such successor collateral agentTrustee). Ifno successor Collateral AgentTrustee shall have been appointed and an instrument ofacceptance by a successor Collateral AgentTrustee shall not have been delivered to theCollateral AgentTrustee within 30 days after the giving of such notice of resignation, theresigning Collateral AgentTrustee or any Holder, on behalf of himself and all otherssimilarly situated, may petition any court of competent jurisdiction for the appointment ofa successor Collateral AgentTrustee satisfying the requirements of Section 6.15(j).
The Collateral AgentTrustee may be removed at any time by Act of a(iii)Majority of each Class of DebtNotes voting separately or, at any time when an Event ofDefault shall have occurred and be continuing by an Act of a Majority of the ControllingClass and a Majority of the Subordinated Notes, delivered to the Collateral AgentTrusteeand to the Co-Issuers.
If at any time:(iv)
the Collateral AgentTrustee shall cease to be eligible under Section (A)6.15(j) and shall fail to resign after written request therefor by the Co-Issuers orby any Holder; or
the Collateral AgentTrustee shall become incapable of acting or(B)shall be adjudged as bankrupt or insolvent or a receiver or liquidator of theCollateral AgentTrustee or of its property shall be appointed or any public officershall take charge or control of the Collateral AgentTrustee or of its property oraffairs for the purpose of rehabilitation, conservation or liquidation;
then, in any such case (subject Section 6.15(k)(i)), (A) the Co-Issuers, by IssuerOrder, may remove the Collateral AgentTrustee, or (B) subject to Section 5.15, anyHolder may, on behalf of himself and all others similarly situated, petition any court ofcompetent jurisdiction for the removal of the Collateral AgentTrustee and theappointment of a successor Collateral AgentTrustee.
If the Collateral AgentTrustee shall be removed or become incapable of(v)acting, or if a vacancy shall occur in the office of the Collateral AgentTrustee for anyreason (other than resignation), the Co-Issuers, by Issuer Order, shall promptly appoint a
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successor Collateral AgentTrustee; provided that such successor collateral agentTrusteeshall be appointed only upon the written consent of a Majority of the Subordinated Notes.If the Co-Issuers shall fail to appoint a successor Collateral AgentTrustee within 30 daysafter such removal or incapability or the occurrence of such vacancy, a successorCollateral AgentTrustee may be appointed by a Majority of the Controlling Class bywritten instrument delivered to the Issuer and the retiring Collateral AgentTrustee. Thesuccessor Collateral AgentTrustee so appointed shall, forthwith upon its acceptance ofsuch appointment, become the successor Collateral AgentTrustee and supersede anysuccessor Collateral AgentTrustee proposed by the Co-Issuers. If no successor Collateral AgentTrustee shall have been so appointed by the Co-Issuers or a Majority of theControlling Class and shall have accepted appointment in the manner hereinafterprovided, subject to Section 5.15, the retiring Collateral AgentTrustee may, or anyHolder may, on behalf of himself and all others similarly situated, petition any court ofcompetent jurisdiction for the appointment of a successor Collateral AgentTrustee.
The Co-Issuers shall give prompt notice of each resignation and each(vi)removal of the Collateral AgentTrustee and each appointment of a successor Collateral AgentTrustee by mailing written notice of such event by first class mail, postage prepaid,to the Investment Manager, to the Collateral AgentTrustee, to the Holders of theDebtNotes as their names and addresses appear in the Register or the Credit Agreement, as applicable, and to each Rating Agency. Each notice shall include the name of thesuccessor Collateral AgentTrustee and the address of its Corporate Office. If theCo-Issuers fail to mail such notice within ten days after acceptance of appointment by thesuccessor Collateral AgentTrustee, the successor Collateral AgentTrustee shall causesuch notice to be given at the expense of the Co-Issuers.
Any resignation or removal of the Collateral AgentTrustee under this(vii)Section 6.15(k) shall be an effective resignation or removal of the Bank in all capacitiesunder this Indenture and Security Agreement (including as Trustee), as CollateralAdministrator under the Collateral Administration Agreement and as Loan Agent under the Credit Agreement.
Acceptance of Appointment by Successor. Every successor Collateral (l)AgentTrustee appointed hereunder shall meet the requirements of Section 6.15(j) and shallexecute, acknowledge and deliver to the Co-Issuers and the retiring Collateral AgentTrustee aninstrument accepting such appointment and agreeing to be bound by the Credit Agreement, thisIndenture and Security Agreement and the Securities Account Control Agreement. Upondelivery of the required instruments, the resignation or removal of the retiring Collateral AgentTrustee shall become effective and such successor Collateral AgentTrustee, without anyfurther act, deed or conveyance, shall become vested with all the rights, powers, trusts, dutiesand obligations of the retiring Collateral AgentTrustee; but, on request of the Co-Issuers or aMajority of any Class of DebtNotes or the successor Collateral AgentTrustee, such retiringCollateral AgentTrustee shall, upon payment of its charges then unpaid, execute and deliver aninstrument transferring to such successor Collateral AgentTrustee all the rights, powers andtrusts of the retiring Collateral AgentTrustee, and shall duly assign, transfer and deliver to suchsuccessor Collateral AgentTrustee all property and Money held by such retiring Collateral AgentTrustee hereunder. Upon request of any such successor Collateral AgentTrustee, the
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Co-Issuers shall execute any and all instruments for more fully and certainly vesting in andconfirming to such successor Collateral AgentTrustee all such rights, powers and trusts.
Merger, Conversion, Consolidation or Succession to Business of (m)Collateral AgentTrustee. Any organization or entity into which the Collateral AgentTrustee maybe merged or converted or with which it may be consolidated, or any organization or entityresulting from any merger, conversion or consolidation to which the Collateral AgentTrusteeshall be a party, or any organization or entity succeeding to all or substantially all of thecorporate trust business of the Collateral AgentTrustee, shall be the successor of the Collateral AgentTrustee hereunder; provided that such organization or entity shall be otherwise qualifiedand eligible under this Article VI, without the execution or filing of any paper or any further acton the part of any of the parties hereto.
To the extent not inconsistent, the Collateral AgentTrustee shall be(n)entitled to all of the protections, immunities, indemnities, rights and privileges of the Trustee setforth in this Indenture and Security Agreement.
ARTICLE VII
COVENANTS
Payment of Principal and Interest. The Applicable Issuers shallSection 7.1duly and punctually pay the principal of and interest on the Rated DebtNotes, in accordance withthe terms of such DebtNotes and this Indenture and Security Agreement pursuant to the Priorityof Payments. The Issuer shall, to the extent legally permitted and to the extent funds areavailable pursuant to the Priority of Payments, duly and punctually pay all required distributionson the Subordinated Notes, in accordance with the Subordinated Notes and this Indenture and Security Agreement.
The Issuer shall, subject to the Priority of Payments, reimburse the Co-Issuer forany amounts paid by the Co-Issuer pursuant to the terms of the DebtNotes or this Indenture and Security Agreement. The Co-Issuer shall not reimburse the Issuer for any amounts paid by theIssuer pursuant to the terms of the DebtNotes or this Indenture and Security Agreement.
Amounts properly withheld under the Code or other applicable law by any Personfrom a payment to any Holder shall be considered as having been paid by the Applicable Issuersto such Holder for all purposes of this Indenture and Security Agreement.
Maintenance of Office or Agency. The Co-Issuers hereby appointSection 7.2the Collateral AgentTrustee as the Paying Agent for payments on the DebtNotes and the Trusteeas Transfer Agent for transfers of the Notes. Notes may be surrendered for registration oftransfer or exchange at the Corporate Office of the Trustee or its agent designated for purposesof surrender, transfer or exchange. The Co-Issuers hereby appoint Corporation ServiceCompany, 1180 Avenue of the Americas, Suite 210, New York, New York 10036-8401, as agentupon whom process or demands may be served in any action arising out of or based on thisIndenture and Security Agreement or the transactions contemplated hereby.
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The Co-Issuers may at any time and from time to time vary or terminate theappointment of any such agent or appoint any additional agents for any or all of such purposes;provided that the Co-Issuers shall maintain in the Borough of Manhattan, The City of New York,an office or agency where notices and demands to or upon the Co-Issuers in respect of suchDebtNotes and this Indenture and Security Agreement may be served and, subject to any laws orregulations applicable thereto, an office or agency outside of the United States where DebtNotesmay be presented and surrendered for payment; provided, further, that no paying agent shall beappointed in a jurisdiction which subjects payments on the DebtNotes to withholding tax inexcess of any withholding tax that was imposed on such payments immediately before theappointment (other than any withholding tax imposed as a result of a failure to provide any taxforms and attachments thereto, and any withholding tax imposed under or in relation toFATCA). The Co-Issuers hereby appoint, for so long as any Class of Notes is listed on the Irish Stock Exchange, Maples and Calder (the “Irish Listing Agent”) as listing agent in Ireland with respect to the Listed Notes. In the event that the Irish Listing Agent is replaced at any time during such period, notice of the appointment of any replacement shall be sent to the Irish Stock Exchange for release through the Companies Announcements Office as promptly as practicable after such appointment. The Co-Issuers shall at all times maintain a duplicate copy of theRegister at the Corporate Office. The Co-Issuers shall give written notice as soon as reasonablypracticable to the Trustee, the Collateral Agent, the Holders, and each Rating Agency of theappointment or termination of any such agent and of the location and any change in the locationof any such office or agency.
If at any time the Co-Issuers shall fail to maintain any such required office oragency in the Borough of Manhattan, The City of New York, or outside the United States, orshall fail to furnish the Collateral AgentTrustee with the address thereof, presentations andsurrenders may be made (subject to the limitations described in the preceding paragraph) at andnotices and demands may be served on the Co-Issuers, and DebtNotes may be presented andsurrendered for payment to the appropriate the Paying Agent at its main office, and theCo-Issuers hereby appoint the same as their agent to receive such respective presentations,surrenders, notices and demands.
Money for DebtNote Payments to Be Held in Trust. All paymentsSection 7.3of amounts due and payable with respect to any DebtNote that is to be made from amountswithdrawn from the Payment Account shall be made on behalf of the Applicable Issuers by theCollateral AgentTrustee or a Paying Agent with respect to payments on the Notes.
When the Applicable Issuers shall have a Paying Agent that is not also theRegistrar, they shall furnish, or cause the Registrar to furnish, no later than the fifth calendar dayafter each Record Date a list, if necessary, in such form as such Paying Agent may reasonablyrequest, of the names and addresses of the Holders and of the certificate numbers of individualNotes held by each such Holder.
Whenever the Applicable Issuers shall have a Paying Agent other than theCollateral AgentTrustee, they shall, on or before the Business Day next preceding each PaymentDate or Redemption Date, as the case may be, direct the Collateral AgentTrustee to deposit onsuch Payment Date with such Paying Agent, if necessary, an aggregate sum sufficient to pay the
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amounts then becoming due (to the extent funds are then available for such purpose in thePayment Account), such sum to be held in trust for the benefit of the Persons entitled thereto and(unless such Paying Agent is the Collateral AgentTrustee) the Co-Issuers shall promptly notifythe Collateral AgentTrustee of its action or failure so to act. Any Monies deposited with aPaying Agent (other than the Collateral AgentTrustee) in excess of an amount sufficient to paythe amounts then becoming due on the DebtNotes with respect to which such deposit was madeshall be paid over by such Paying Agent to the Collateral AgentTrustee for application inaccordance with Article X.
The initial Paying Agent shall be as set forth in Section 7.2. Any additional orsuccessor Paying Agents shall be appointed by Issuer Order with written notice thereof to theCollateral AgentTrustee; provided that so long as the DebtNotes of any Class are rated by aRating Agency, with respect to any additional or successor Paying Agent, either (i) such PayingAgent has (x) a long-term debt rating of “A2” or higher by Moody’s and a short term debt ratingof “P-1” by Moody’s and (y) a short-term issuer default rating of “F1” and a long-term issuerdefault rating of “A” by Fitch (or, if no short-term issuer default rating exists, a long-term issuerdefault rating of not lower than “A+” by Fitch) or (ii) the Global Rating Agency Condition issatisfied. In the event that such successor Paying Agent ceases to have (x) a long-term debtrating of “A2” or higher by Moody’s and a short-term debt rating of “P-1” by Moody’s or (y) ashort-term issuer default rating of “F1” and a long-term issuer default rating of “A” by Fitch (or,if no short-term issuer default rating exists, a long-term issuer default rating of not lower than“A+” by Fitch), the Co-Issuers shall promptly remove such Paying Agent and appoint asuccessor Paying Agent that satisfies such required ratings within 30 days of receipt of notice ofsuch failure. The Co-Issuers shall not appoint any Paying Agent that is not, at the time of suchappointment, a depository institution or trust company subject to supervision and examination byfederal and/or state and/or national banking authorities. The Co-Issuers shall cause each PayingAgent other than the Collateral AgentTrustee to execute and deliver to the Collateral AgentTrustee an instrument in which such Paying Agent shall agree with the Collateral AgentTrustee and if the Collateral AgentTrustee acts as Paying Agent, it hereby so agrees,subject to the provisions of this Section 7.3, that such Paying Agent shall:
allocate all sums received for payment to the Holders of DebtNotes for(a)which it acts as Paying Agent on each Payment Date and any Redemption Date among suchHolders in the proportion specified in the applicable Distribution Report or report pertaining tosuch Redemption Date to the extent permitted by applicable law;
hold all sums held by it for the payment of amounts due with respect to the(b)DebtNotes in trust for the benefit of the Persons entitled thereto until such sums shall be paid tosuch Persons or otherwise disposed of as herein provided and pay such sums to such Persons asherein provided;
if such Paying Agent is not the Collateral AgentTrustee, immediately(c)resign as a Paying Agent and forthwith pay to the Collateral AgentTrustee all sums held by it intrust for the payment of DebtNotes if at any time it ceases to meet the standards set forth aboverequired to be met by a Paying Agent at the time of its appointment;
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if such Paying Agent is not the Collateral AgentTrustee, immediately give(d)the Collateral AgentTrustee notice of any default by the Issuer or the Co-Issuer (or any otherobligor upon the DebtNotes) in the making of any payment required to be made; and
if such Paying Agent is not the Collateral AgentTrustee, during the(e)continuance of any such default, upon the written request of the Collateral AgentTrustee,forthwith pay to the Collateral AgentTrustee all sums so held in trust by such Paying Agent.
The Co-Issuers may at any time, for the purpose of obtaining the satisfaction anddischarge of this Indenture and Security Agreement or for any other purpose, pay, or by IssuerOrder direct any Paying Agent to pay, to the Collateral AgentTrustee all sums held in trust by theCo-Issuers or such Paying Agent, such sums to be held by the Collateral AgentTrustee upon thesame trusts as those upon which such sums were held by the Co-Issuers or such Paying Agent;and, upon such payment by any Paying Agent to the Collateral AgentTrustee, such Income NotePaying Agent shall be released from all further liability with respect to such Money.
Except as otherwise required by applicable law, any Money deposited with theCollateral AgentTrustee or any Paying Agent in trust for any payment on any DebtNotes andremaining unclaimed for two years after such amount has become due and payable shall be paidto the Applicable Issuers on Issuer Order; and the Holder of such DebtNotes shall thereafter, asan unsecured general creditor, look only to the Applicable Issuers for payment of such amounts(but only to the extent of the amounts so paid to the Applicable Issuers) and all liability of theCollateral AgentTrustee or such Paying Agent with respect to such trust Money shall thereuponcease. The Collateral AgentTrustee or such Paying Agent, before being required to make anysuch release of payment, may, but shall not be required to, adopt and employ, at the expense ofthe Applicable Issuers any reasonable means of notification of such release of payment,including, but not limited to, mailing notice of such release to Holders whose Debt hasNotes have been called but has not been surrendered for redemption or whose right to or interest inMonies due and payable but not claimed is determinable from the records of any Paying Agent,at the last address of record of each such Holder.
Existence of Co-Issuers. (a) The Issuer and the Co-Issuer shall, toSection 7.4the maximum extent permitted by applicable law, maintain in full force and effect their existenceand rights as companies incorporated or organized under the laws of the Cayman Islands and theState of Delaware, respectively, and shall obtain and preserve their qualification to do businessas exempted or foreign corporations in each jurisdiction in which such qualifications are or shallbe necessary to protect the validity and enforceability of this Indenture and Security Agreement,the DebtNotes or any of the Assets; provided that the Issuer shall be entitled to change itsjurisdiction of incorporation from the Cayman Islands to any other jurisdiction reasonablyselected by the Issuer so long as (i) the Issuer has received a legal opinion (upon which theCollateral Agent and the Loan AgentTrustee may conclusively rely) to the effect that suchchange is not disadvantageous in any material respect to the Holders or the holders of the IncomeNotes, (ii) written notice of such change shall have been given by the Issuer to the Collateral AgentTrustee (which shall provide notice to the Holders), the Investment Manager, the Trustee, the Loan Agent and each Rating Agency and (iii) on or prior to the 15th Business Day followingreceipt of such notice the Collateral AgentTrustee shall not have received written notice from a
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Majority of the Controlling Class objecting to such change; provided, further, that the Issuershall be entitled to take any action required by this Indenture and Security Agreement within theUnited States notwithstanding any provision of this Indenture and Security Agreement requiringthe Issuer to take such action outside of the United States so long as prior to taking any suchaction the Issuer receives a legal opinion from nationally recognized legal counsel to the effectthat it is not necessary to take such action outside of the United States or any politicalsubdivision thereof in order to prevent the Issuer from being treated as engaged in a trade orbusiness in the United States for U.S. federal income tax purposes or the Income Note Issuerfrom otherwise becoming subject to United States Federal, state or local income taxes on a netincome basis to which the Income Note Issuer would not otherwise be subject.
Each of the Issuer and the Co-Issuer shall (i) ensure that all corporate or(b)other formalities regarding its existence (including, to the extent required by applicable law,holding regular board of directors,’ members’, partners’ and shareholders’ or other similarmeetings) are followed, (ii) conduct business in its own name, (iii) correct any knownmisunderstanding as to its separate existence, (iv) keep separate books and records and (v) notcommingle its funds with those of any other entity. Neither the Issuer nor the Co-Issuer shalltake any action, or conduct its affairs in a manner, that is likely to result in its separate existencebeing ignored or in its assets and liabilities being substantively consolidated with any otherPerson in a bankruptcy, reorganization or other insolvency proceeding. Without limiting theforegoing, (i) the Issuer shall not have any subsidiaries (other than the Co-Issuer and any IssuerSubsidiary), (ii) the Co-Issuer shall not have any subsidiaries and (iii) except to the extentcontemplated in the Administration Agreement, the Registered Office Agreement or the Issuer’sdeclaration of trust, dated as of the Closing Date, the Issuer and the Co-Issuer shall not (A) haveany employees (other than their respective directors, members or managers, as applicable), (B)except as contemplated by the Investment Management Agreement, the Memorandum andArticles, the Administration Agreement or the Income Note Paying Agency Agreement, engagein any transaction with any shareholder or member, as applicable, that would constitute a conflictof interest or (C) pay dividends other than in accordance with the terms of this Indenture and Security Agreement and the Memorandum and Articles.
Protection of Assets. (a) The Issuer, or the Investment Manager onSection 7.5behalf and at the expense of the Issuer, shall cause the taking of such action by the Issuer (or bythe Investment Manager if within the Investment Manager’s control under the InvestmentManagement Agreement) as is reasonably necessary in order to perfect and maintain theperfection and priority of the security interest of the Collateral AgentTrustee in the Assets. TheIssuer shall from time to time prepare or cause to be prepared, execute, deliver and file all suchsupplements and amendments hereto and all such Financing Statements, continuation statements,instruments of further assurance and other instruments, and shall take such other action as maybe necessary or advisable or desirable to secure the rights and remedies of the Collateral AgentTrustee for the benefit of the Holders of the Rated DebtNotes hereunder and to:
Grant more effectively all or any portion of the Issuer’s right, title and(i)interest in, to and under the Assets;
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maintain, preserve and perfect any Grant made or to be made by this(ii)Indenture and Security Agreement including, without limitation, the first priority natureof the lien or carry out more effectively the purposes hereof;
perfect, publish notice of or protect the validity of any Grant made or to be(iii)made by this Indenture and Security Agreement (including, without limitation, any andall actions necessary or desirable as a result of changes in law or regulations);
enforce any of the Pledged Obligations or other instruments or property(iv)included in the Assets;
preserve and defend title to the Assets and the rights therein of the(v)Secured Parties in the Assets against the claims of all Persons and parties; or
if reasonably able to do so, deliver or cause to be delivered a United States(vi)Internal Revenue Service Form W-8IMY or successor applicable form and other properlycompleted and executed documentation, agreements, and certifications to each issuer,counterparty, paying agent, and/or to any applicable taxing authority or othergovernmental authority as necessary to permit the Issuer to receive payments withoutwithholding or deduction or at a reduced rate of withholding or deduction and tootherwise pay or cause to be paid any and all taxes levied or assessed upon all or any partof the Assets.
The Issuer hereby designates the Collateral AgentTrustee as its agent and attorneyin fact to prepare and file or record any Financing Statement (other than the Financing Statementdelivered on the Closing Date), continuation statement and all other instruments, and take allother actions, required pursuant to this Section 7.5; provided that such appointment shall notimpose upon the Collateral AgentTrustee any of the Issuer’s or the Investment Manager’sobligations under this Section 7.5. In connection therewith, the Collateral AgentTrustee shall beentitled to receive, at the cost of the Issuer, and conclusively rely upon an Opinion of Counseldelivered in accordance with Section 7.6 as to the need to file, the dates by which such filings arerequired to be made and the jurisdiction in which such filings are to be made and the form andcontent of such filings. The Issuer further authorizes and shall cause the Issuer’s United Statescounsel to file a Financing Statement that names the Issuer as debtor and the Collateral AgentTrustee, on behalf of the Secured Parties, as secured party and that describes “all assets inwhich the debtor now or hereafter has rights” as the Assets in which the Collateral AgentTrusteehas a Grant.
The Collateral AgentTrustee shall not, except in accordance with Article (b)V and Sections 10.6, 12.1, and 12.4, as applicable, permit the removal of any portion of theAssets or transfer any such Assets from the Account to which it is credited, or cause or permitany change in the Delivery made pursuant to Section 3.3 with respect to any Assets, if, aftergiving effect thereto, the jurisdiction governing the perfection of the Collateral AgentTrustee’ssecurity interest in such Assets is different from the jurisdiction governing the perfection at thetime of delivery of the most recent Opinion of Counsel pursuant to Section 7.6 (or, if no Opinionof Counsel has yet been delivered pursuant to Section 7.6, the Opinion of Counsel delivered at
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the Closing Date pursuant to Section 3.1(a)(iii)) unless the Collateral AgentTrustee shall havereceived an Opinion of Counsel to the effect that the lien and security interest created by thisIndenture and Security Agreement with respect to such property and the priority thereof shallcontinue to be maintained after giving effect to such action or actions.
The Issuer shall register this Indenture and Security Agreement in the(c)Register of Mortgages and Charges at the Issuer’s registered office in the Cayman Islands.
Opinions as to Assets. Within the six-month period preceding theSection 7.6fifth anniversary of the Closing Date (and every five years thereafter), the Issuer shall furnish tothe Collateral AgentTrustee, Fitch and Moody’s an Opinion of Counsel either (i) stating that, inthe opinion of such counsel, such action has been taken (including without limitation withrespect to the filing of any Financing Statements and continuation statements) as is necessary tomaintain the lien and security interest created by this Indenture and Security Agreement andreciting the details of such action or (ii) describing the filing of any Financing Statements andcontinuation statements that shall, in the opinion of such counsel, be required to maintain the lienand security interest of this Indenture and Security Agreement.
Performance of Obligations. (a) The Co-Issuers, each as to itself,Section 7.7shall not take any action, and shall use their commercially reasonable efforts not to permit anyaction to be taken by others, that would release any Person from any of such Person’s covenantsor obligations under any instrument included in the Assets, except in the case of pricingamendments, ordinary course waivers/amendments, and enforcement action taken with respect toany Defaulted Obligation in accordance with the provisions hereof and actions by the InvestmentManager under the Investment Management Agreement and in conformity with this Indenture and Security Agreement or as otherwise required hereby.
The Applicable Issuers may, with the prior written consent of a Majority(b)of each Class of Rated DebtNotes (except in the case of the Investment Management Agreementand the Collateral Administration Agreement, in which case no consent shall be required),contract with other Persons, including the Investment Manager, the Trustee, the Loan Agent, the Collateral Agent and the Collateral Administrator for the performance of actions and obligationsto be performed by the Applicable Issuers hereunder and under the Investment ManagementAgreement by such Persons. Notwithstanding any such arrangement, the Applicable Issuersshall remain primarily liable with respect thereto. In the event of such contract, the performanceof such actions and obligations by such Persons shall be deemed to be performance of suchactions and obligations by the Applicable Issuers; and the Applicable Issuers shall punctuallyperform, and use their commercially reasonable efforts to cause the Investment Manager, the Collateral Agent, the Trustee, the Loan Agent, the Collateral Administrator and such otherPerson to perform, all of their obligations and agreements contained in the InvestmentManagement Agreement, this Indenture and Security Agreement, the Credit Agreement, theCollateral Administration Agreement or any such other agreement.
If the Co-Issuers receive a notice from a Rating Agency stating that they(c)are not in compliance with Rule 17g-5, the Co-Issuers shall take such action as mutually agreedbetween the Co-Issuers and such Rating Agency in order to comply with Rule 17g-5.
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Negative Covenants. (a) The Issuer shall not and, with respect toSection 7.8clauses (i), (ii), (iii), (iv), (vi), (vii), (viii), (ix) and (x) the Co-Issuer shall not, in each case fromand after the Closing Date:
sell, transfer, exchange or otherwise dispose of, or pledge, mortgage,(i)hypothecate or otherwise encumber (or permit such to occur or suffer such to exist), anypart of the Assets, except as expressly permitted by this Indenture and Security Agreement and the Investment Management Agreement;
claim any credit on, make any deduction from, or dispute the(ii)enforceability of payment of the principal or interest payable (or any other amount) inrespect of the Notes (other than amounts withheld in accordance with the Code or anyapplicable laws of the Cayman Islands or other applicable jurisdiction) or assert anyclaim against any present or future Holder of Notes, by reason of the payment of anytaxes levied or assessed upon any part of the Assets, other than as described in Section 2.15, Section 7.16 or otherwise pursuant to this Indenture and Security Agreement;
(A) incur or assume or guarantee any indebtedness, other than the(iii)DebtNotes and this Indenture and Security Agreement and the Credit Agreement and thetransactions contemplated hereby or the Credit Agreement, or (B)(1) issue any additionalclass of securities or incur any additional loans (except as provided in Section 2.4 andthereby) or (2) issue any additional shares;
(A) permit the validity or effectiveness of this Indenture and Security (iv)Agreement or any Grant hereunder to be impaired, or permit the lien of this Indenture and Security Agreement to be amended, hypothecated, subordinated, terminated ordischarged, or permit any Person to be released from any covenants or obligations withrespect to this Indenture and Security Agreement or the DebtNotes, except as may bepermitted hereby or by the Investment Management Agreement, (B) except as permittedby this Indenture and Security Agreement, permit any lien, charge, adverse claim,security interest, mortgage or other encumbrance (other than the lien of this Indentureand Security Agreement) to be created on or extend to or otherwise arise upon or burdenany part of the Assets, any interest therein or the proceeds thereof, or (C) except aspermitted by this Indenture and Security Agreement, take any action that would permitthe lien of this Indenture and Security Agreement not to constitute a valid first prioritysecurity interest in the Assets;
amend the Investment Management Agreement except pursuant to the(v)terms thereof and Article XV of this Indenture and Security Agreement;
dissolve or liquidate in whole or in part, except as permitted hereunder or(vi)required by applicable law;
pay any distributions other than in accordance with the Priority of(vii)Payments;
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permit the formation of any subsidiaries (other than any TaxIssuer(viii)Subsidiary);
conduct business under any name other than its own;(ix)
have any employees (other than directors to the extent they are(x)employees);
sell, transfer, exchange or otherwise dispose of Assets, or enter into an(xi)agreement or commitment to do so or enter into or engage in any business with respect toany part of the Assets, except as expressly permitted by this Indenture and Security Agreement or the Investment Management Agreement;
elect to be taxable for U.S. federal income tax purposes as other than a(xii)foreign partnership without the unanimous consent of all Holders;
establish a branch, agency, office or place of business in the United States,(xiii)or take any action or engage in any activity (directly or through any other agent) whichwould subject it to United States federal, state, or local tax;
solicit, advertise or publish the Issuer’s ability to enter into credit(xiv)derivatives;
register as or become subject to regulatory supervision or other legal(xv)requirements under the laws of any country or political subdivision thereof as a bank,insurance company or finance company;
knowingly take any action that would reasonably be expected to cause it(xvi)to be treated as a bank, insurance company or finance company for purposes of (i) anytax, securities law or other filing or submission made to any governmental authority, (ii)any application made to a rating agency or (iii) qualification for any exemption from tax,securities law or any other legal requirements; and
hold itself out to the public as a bank, insurance company or finance(xvii)company.
The Co-Issuer shall not invest any of its assets in “securities” as such term(b)is defined in the Investment Company Act, and shall keep all of its assets in Cash.
So long as any Debt isNotes are Outstanding, the Co-Issuer shall not elect(c)to be taxable for U.S. federal income tax purposes as other than a disregarded entity without theunanimous consent of all Holders.
Notwithstanding anything to the contrary contained herein, the Issuer shall(d)not, and shall use its commercially reasonable efforts to ensure that the Investment Manageracting on the Issuer’s behalf does not, acquire or own any asset, conduct any activity or take anyaction unless the acquisition or ownership of such asset, the conduct of such activity or the
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taking of such action, as the case may be, would not cause the Issuer to be engaged, or deemed tobe engaged, in a trade or business within the United States for United States federal income taxpurposes or otherwise cause the Income Note Issuer to be subject to United States federalincome tax on a net income basis or income tax on a net income basis in any other jurisdiction.
In furtherance and not in limitation of Section 7.8(d), notwithstanding(e)anything to the contrary contained herein, the Issuer shall comply with all of the provisions setforth in the Tax Guidelines, unless, with respect to a particular transaction, the Issuer, theInvestment Manager, the Loan Agent and the Collateral AgentTrustee shall have receivedwritten advice of White & Case LLP orCadwalader, Wickersham & Taft LLP, Winston &Strawn LLP, or a written opinion of other tax counsel of nationally recognized standing in theUnited States experienced in such matters, to the effect that the Issuer will not be treated asengaged, in a trade or business within the United States for United States federal income taxpurposes or otherwise cause the Income Note Issuer to be subject to United States federalincome tax on a net income basis. The provisions set forth in the Tax Guidelines may bewaived, amended, eliminated, modified or supplemented (without execution of an amendment tothe Investment Management Agreement) if the Issuer, the Investment Manager, the Loan Agentand the Collateral AgentTrustee shall have received written advice of White & Case LLP orCadwalader, Wickersham & Taft LLP, Winston & Strawn LLP, or a written opinion of othertax counsel of nationally recognized standing in the United States experienced in such matters, tothe effect that the Issuer will not be treated as engaged in a trade or business within the UnitedStates for United States federal income tax purposes or otherwise cause the Income Note Issuerto be subject to United States federal income tax on a net income basis. For the avoidance ofdoubt, in the event written advice of White & Case LLP orCadwalader, Wickersham & Taft LLP, Winston & Strawn LLP, or a written opinion of other tax counsel as described above, hasbeen obtained in accordance with the terms hereof, no consent of any Holder of DebtNotes orGlobal Rating Agency Condition shall be required in order to comply with this Section 7.8(e) inconnection with the waiver, amendment, elimination, modification or supplementation of anyprovision of the Tax Guidelines contemplated by such advice or opinion of tax counsel.
The Issuer and the Co-Issuer shall not be party to any agreements(f)(including Hedge Agreements) without including customary “non-petition” and “limitedrecourse” provisions therein (and shall not amend or eliminate such provisions in any agreementto which it is party), except for any agreements related to the purchase and sale of any CollateralObligations or Eligible Investments which contain customary (as determined by the InvestmentManager in its sole discretion) purchase or sale terms or which are documented using customary(as determined by the Investment Manager in its sole discretion) loan trading documentation.
The Issuer shall not acquire or hold any Certificated Securities in bearer(g)form (other than securities not required to be in registered form under Section 163(f)(2)(A) ofthe Code) in a manner that does not satisfy the requirements of United States TreasuryRegulations Section 1.165-12(c).
The Co-Issuer shall not fail to maintain an independent manager under its(h)limited liability company agreement.
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Statement as to Compliance. On or before November 14th in eachSection 7.9calendar year, commencing in 2015, or immediately if there has been a Default under thisIndenture and Security Agreement and prior to the issuance and/or incurrence of any AdditionalDebtNotes pursuant to Section 2.4 or the Credit Agreement, as applicable, the Issuer shalldeliver to the Trustee, the Collateral Agent, the Investment Manager, the Loan Agent and theAdministrator (to be forwarded, at the cost of the Issuer, by the Collateral AgentTrustee to eachHolder of DebtNotes making a written request therefor and each Rating Agency) an Officer’scertificate of the Issuer that, having made reasonable inquiries of the Investment Manager, and tothe best of the knowledge, information and belief of the Issuer, there did not exist, as at a datenot more than five days prior to the date of the certificate, nor had there existed at any time priorthereto since the date of the last certificate (if any), any Default hereunder or, if such Default didthen exist or had existed, specifying the same and the nature and status thereof, including actionsundertaken to remedy the same, and that the Issuer has complied with all of its obligations underthis Indenture and Security Agreement and the Credit Agreement or, if such is not the case,specifying those obligations with which it has not complied.
Co-Issuers May Consolidate, etc. Only on Certain Terms. NeitherSection 7.10the Issuer nor the Co-Issuer (the “Merging Entity”) shall consolidate or merge with or into anyother Person or transfer or convey all or substantially all of its assets to any Person, unlesspermitted by Cayman Islands law (in the case of the Issuer) or United States and Delaware law(in the case of the Co-Issuer) and unless:
the Merging Entity shall be the surviving corporation, or the Person (if(a)other than the Merging Entity) formed by such consolidation or into which the Merging Entity ismerged or to which all or substantially all of the assets of the Merging Entity are transferred (the“Successor Entity”) (A) if the Merging Entity is the Issuer, shall be a company incorporated andexisting under the laws of the Cayman Islands or such other jurisdiction approved by a Majorityof the Controlling Class; provided that no such approval shall be required in connection with anysuch transaction undertaken solely to effect a change in the jurisdiction of incorporation pursuantto Section 7.4, and (B) in any case shall expressly assume, by an indenture and security agreementIndenture supplemental hereto and an amendment to the Credit Agreement, executedand delivered to the Collateral AgentTrustee and each Holder, the due and punctual payment ofthe principal of and interest on all Rated DebtNotes issued by the Merging Entity and theperformance and observance of every covenant of this Indenture and Security Agreement and the Credit Agreement on its part to be performed or observed, all as provided herein;
the Collateral AgentTrustee shall have received notice of such(b)consolidation or merger and shall have distributed copies of such notice to each Rating Agencyas soon as reasonably practicable and in any case no less than five days prior to such merger orconsolidation, and the Collateral AgentTrustee shall have received written confirmation fromeach Rating Agency that its ratings issued with respect to the Rated DebtNotes then rated bysuch Rating Agency shall not be reduced or withdrawn as a result of the consummation of suchtransaction;
if the Merging Entity is not the surviving corporation, the Successor Entity(c)shall have agreed with the Collateral Agent and the Trustee (i) to observe the same legal
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requirements for the recognition of such formed or surviving corporation as a legal entityseparate and apart from any of its Affiliates as are applicable to the Merging Entity with respectto its Affiliates and (ii) not to consolidate or merge with or into any other Person or transfer orconvey the Assets or all or substantially all of its assets to any other Person except in accordancewith the provisions of this Section 7.10;
if the Merging Entity is not the surviving corporation, the Successor Entity(d)shall have delivered to the Trustee, the Collateral Agent and each Rating Agency, an Officer’scertificate and an Opinion of Counsel each stating that such Person shall be duly organized,validly existing and in good standing in the jurisdiction in which such Person is organized; thatsuch Person has sufficient power and authority to assume the obligations set forth in subsection(a) above and to execute and deliver an indenture and security agreementIndenture supplementalhereto and an amendment to the Credit Agreement for the purpose of assuming such obligations;that such Person has duly authorized the execution, delivery and performance of an indenture and security agreementIndenture supplemental hereto and an amendment to the Credit Agreement for the purpose of assuming such obligations and that each such supplementalindenture and security agreement and amendment to the Credit Agreement is a valid, legal andbinding obligation of such Person, enforceable in accordance with its terms, subject only tobankruptcy, reorganization, insolvency, moratorium and other laws affecting the enforcement ofcreditors’ rights generally and to general principles of equity (regardless of whether suchenforceability is considered in a Proceeding in equity or at law); if the Merging Entity is theIssuer, that, immediately following the event which causes such Successor Entity to become thesuccessor to the Issuer, (i) such Successor Entity has title, free and clear of any lien, securityinterest or charge, other than the lien and security interest of this Indenture and Security Agreement, to the Assets securing all of the DebtNotes, and (ii) the Collateral AgentTrusteecontinues to have a valid perfected first priority security interest in the Assets securing all of theRated DebtNotes; and in each case as to such other matters as the Collateral AgentTrustee or anyHolder of DebtNotes may reasonably require; provided that nothing in this clause shall imply orimpose a duty on the Collateral AgentTrustee to require such other documents;
immediately after giving effect to such transaction, no Default or Event of(e)Default shall have occurred and be continuing;
the Merging Entity shall have delivered notice to each Rating Agency, and(f)the Merging Entity shall have delivered to the Collateral Agent, the Trustee and each Holder ofDebtNotes an Officer’s certificate and an Opinion of Counsel each stating that suchconsolidation, merger, transfer or conveyance and such supplemental indenture and security agreement comply with this Article VII and that all conditions in this Article VII relating to suchtransaction have been complied with and that such transaction will not (1) result in the MergingEntity and Successor Entity becoming subject to United States federal income taxation withrespect to their net income, (2) result in the Merging Entity and Successor Entity being treated asbeing engaged in a trade or business within the United States or (3) have a material adverseeffect on the tax treatment of the Issuer or the tax consequences to the holders of any Class ofDebtNotes Outstanding at the time of issuance, as described in the Offering Circular under theheading “Certain U.S. Federal Income Tax Considerations,” unless the Holders agree byunanimous consent that no adverse tax consequences will result therefrom to any of the Merging
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Entity, Successor Entity and Holders of the DebtNotes (as compared to the tax consequences ofnot effecting the transaction);
the Merging Entity shall have delivered to the Collateral AgentTrustee an(g)Opinion of Counsel stating that after giving effect to such transaction, neither of the Co-Issuers(or, if applicable, the Successor Entity) will be required to register as an investment companyunder the Investment Company Act; and
after giving effect to such transaction, the outstanding stock (other than(h)the Subordinated Notes) of the Merging Entity (or, if applicable, the Successor Entity) will notbe beneficially owned within the meaning of the Investment Company Act by any U.S. person.
Successor Substituted. Upon any consolidation or merger, orSection 7.11transfer or conveyance of all or substantially all of the assets of the Issuer or the Co-Issuer, inaccordance with Section 7.10 in which the Merging Entity is not the surviving corporation, theSuccessor Entity shall succeed to, and be substituted for, and may exercise every right and powerof, and shall be bound by each obligation and covenant of, the Merging Entity under thisIndenture and Security Agreement with the same effect as if such Person had been named as theIssuer or the Co-Issuer, as the case may be, herein. In the event of any such consolidation,merger, transfer or conveyance, the Person named as the “Issuer” or the “Co-Issuer” in the firstparagraph of this Indenture and Security Agreement or any successor which shall theretoforehave become such in the manner prescribed in this Article VII may be dissolved, wound up andliquidated at any time thereafter, and such Person thereafter shall be released from its liabilitiesas obligor and maker on all the Notes and from its obligations under this Indenture and Security Agreement.
No Other Business. From and after the Closing Date, the IssuerSection 7.12shall not engage in any business or activity other than issuing and selling the Notes pursuant tothis Indenture and Security Agreement, the borrowing of Class A Loans pursuant to the Credit Agreement and acquiring, owning, holding, selling, lending, exchanging, redeeming, pledging,contracting for the management of and otherwise dealing with Collateral Obligations and theother Assets in connection therewith and entering into Hedge Agreements, the CollateralAdministration Agreement, the Securities Account Control Agreement, the InvestmentManagement Agreement and other agreements specifically contemplated by this Indenture and Security Agreement and the Credit Agreement and shall not engage in any activity that wouldcause the Issuer to be subject to U.S. federal or state income tax on a net income basis, and theCo-Issuer shall not engage in any business or activity other than issuing and selling the Notes tobe issued by it pursuant to this Indenture and Security Agreement, borrowing of the Class A Loans pursuant to the Credit Agreement and, with respect to the Issuer and the Co-Issuer, suchother activities which are necessary, suitable or convenient to accomplish the foregoing or areincidental thereto or connected therewith or ancillary thereto. The Issuer and the Co-Issuer mayamend, or permit the amendment of, the Memorandum and Articles of the Issuer and theCertificate of Formation and By-laws of the Co-Issuer, respectively only upon satisfaction of theGlobal Rating Agency Condition.
Annual Rating Review. (a) So long as any of the Rated DebtNotesSection 7.13of any Class remain Outstanding, on or before November 14th in each year,the anniversary of the
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Amendment Date commencing in 2015,2018, the Applicable Issuers shall obtain and pay for anannual review of the rating of each such Class of Rated DebtNotes from each Rating Agency, asapplicable. The Applicable Issuers shall promptly notify the Trustee, Fitch, the Collateral Agent, the Loan Agent and the Investment Manager in writing (and the Trustee shall promptly providethe Holders with a copy of such notice) if at any time the rating of any such Class of RatedDebtNotes has been, or is known shall be, changed or withdrawn.
With respect to any credit estimate assigned by Moody’s to a Collateral(b)Obligation hereunder, the Issuer shall annually obtain (and pay for) from Moody’s writtenconfirmation of, or an update to, the credit estimate with respect to such Collateral Obligation.
Reporting. At any time when the Co-Issuers are not subject toSection 7.14Section 13 or 15(d) of the Exchange Act and are not exempt from reporting pursuant to Rule12g3-2(b) under the Exchange Act, upon the request of a Holder or beneficial owner of a Note,the Co-Issuers shall promptly furnish or cause to be furnished “Rule 144A Information” to suchHolder or beneficial owner, to a prospective purchaser of such Note designated by such Holderor beneficial owner, or to the Trustee for delivery to such Holder or beneficial owner or aprospective purchaser designated by such Holder or beneficial owner, as the case may be, inorder to permit compliance by such Holder or beneficial owner of such Note with Rule 144Aunder the Securities Act in connection with the resale of such Note by such Holder or beneficialowner of such Note, respectively. “Rule 144A Information” shall be such information as isspecified pursuant to Rule 144A(d)(4) under the Securities Act (or any successor provisionthereto).
Calculation Agent. (a) The Issuer hereby agrees that for so long asSection 7.15any Rated Debt remainsNotes remain Outstanding there shall at all times be an agent appointed(which does not control or is not controlled or under common control with the Issuer or itsAffiliates or the Investment Manager or its Affiliates) to calculate LIBOR in respect of eachInterest Accrual Period in accordance with the terms of Exhibit C hereto (the “Calculation Agent”). The Issuer hereby appoints the Collateral Administrator as Calculation Agent. TheCalculation Agent may be removed by the Issuer or the Investment Manager, on behalf of theIssuer, at any time. If the Calculation Agent is unable or unwilling to act as such or is removedby the Issuer or the Investment Manager, on behalf of the Issuer, or if the Calculation Agent fails to determine any of the information required to be sent to the Irish Listing Agent for release through the Companies Announcement Office of the Irish Stock Exchange,the Issuer shallpromptly appoint a replacement Calculation Agent which does not control or is not controlled byor under common control with the Issuer or its Affiliates or the Investment Manager or itsAffiliates. The Calculation Agent may not resign its duties without a successor having been dulyappointed. In addition, for so long as any Notes are listed on the Irish Stock Exchange and the guidelines of such exchange so require, notice of the appointment of any replacementTheCalculation Agent shall be sent to the Irish Listing Agent for release through the Companies Announcements Office of the Irish Stock Exchangehave no (i) responsibility for the selection of an Alternative Rate or designation thereof and shall be entitled to rely upon any designation of such a rate by the Investment Manager and (ii) liability for any failure or delay in performing its duties hereunder as a result of the unavailability of a “LIBOR” rate as described in the definition thereof.
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The Calculation Agent shall be required to agree (and the Collateral(b)Administrator as Calculation Agent does hereby agree) that, as soon as practicable after 11:00a.m. London time on each Interest Determination Date, but in no event later than 11:00 a.m. NewYork time on the London Banking Day immediately following each Interest Determination Date,the Calculation Agent shall calculate the DebtNote Interest Rate for each Class of RatedDebtNotes for the next Interest Accrual Period and the DebtNote Interest Amount for each Classof Rated DebtNotes (in each case, rounded to the nearest cent, with half a cent being roundedupward) for the next Interest Accrual Period, on the related Payment Date. At such time theCalculation Agent shall communicate such rates and amounts to the Co-Issuers, the Trustee, the Collateral Agent, the Income Note Paying Agent, any Paying Agent, the Investment Manager,Euroclear and Clearstream. The Calculation Agent shall also specify to the Co-Issuers thequotations upon which the foregoing rates and amounts are based, and in any event theCalculation Agent shall notify the Co-Issuers before 5:00 p.m. (New York time) on everyInterest Determination Date if it has not determined and is not in the process of determining anysuch DebtNote Interest Rate or DebtNote Interest Amount together with its reasons therefor.The Calculation Agent’s determination of the foregoing rates and amounts for any InterestAccrual Period shall (in the absence of manifest error) be final and binding upon all parties.
Certain Tax Matters. (a) The Issuer, the Co-Issuer and the IncomeSection 7.16Note Issuer will treat the Issuer, the Co-Issuer, the Income Note Issuer and the DebtNotes asdescribed in the “Certain U.S. Federal Income Tax Considerations” section of the OfferingCircular for all U.S. federal, state and local income tax purposes and will take no actioninconsistent with such treatment unless required by law.
The Issuer, the Co-Issuer and the Income Note Issuer shall prepare and(b)file, and the Issuer shall cause each Issuer Subsidiary to prepare and file, or in each case shallhire accountants and the accountants shall cause to be prepared and filed (and, where applicable,delivered to the Issuer or Holders) for each taxable year of the Issuer, the Co-Issuer, the IncomeNote Issuer and the Issuer Subsidiary the federal, state and local income tax returns and reportsas required under the Code, or any tax returns or information tax returns required by anygovernmental authority which the Issuer, the Co-Issuer, the Income Note Issuer or the IssuerSubsidiary are required to file (and, where applicable, deliver), and shall provide to each Holderany information that such Holder reasonably requests in order for such Holder to comply with itsU.S. federal, state or local tax and information return and reporting obligations; provided thatnone of the Issuer, the Co-Issuer or the Income Note Issuer shall file, or cause to be filed, anyincome or franchise tax return in the United States or any state of the United States unless it shallhave obtained written advice of White & CaseCadwalader, Wickersham & Taft LLP or, Winston& Strawn LLP, or a written opinion of other nationally recognized U.S. tax counsel experiencedin such matters, prior to such filing to the effect that, under the laws of such jurisdiction, theIssuer, the Co-Issuer or the Income Note Issuer (as applicable) is required to file such income orfranchise tax return.
Notwithstanding any provision herein to the contrary, the Issuer and the(c)Income Note Issuer shall take, and the Issuer shall cause any Issuer Subsidiary to take, any andall actions that may be necessary or appropriate to ensure that the Issuer, the Income Note Issueror such Issuer Subsidiary satisfies any and all reporting, withholding and tax payment
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obligations under Code Sections 1441, 1445, 1446, 1471, 1472, or any other provision of theCode or other applicable law. Without limiting the generality of the foregoing, each of theIssuer, the Income Note Issuer and any Issuer Subsidiary may withhold any amount that it or anyadvisor retained by the Trustee on its behalf determines is required to be withheld from anyamounts otherwise distributable to any Person. In addition, the Issuer shall, and shall cause eachIssuer Subsidiary to, cause to be delivered any properly completed and executed documentation,agreements, and certifications to each issuer, counterparty, paying agent, and/or any applicabletaxing authority, and enter into any agreements with a taxing authority or other governmentalauthority, as necessary to avoid or reduce the withholding, deduction, or imposition of U.S.income or withholding tax.
Upon the Trustee’s receipt of a request of a Holder delivered in(d)accordance with the notice procedures of Section 14.3, for the information described in UnitedStates Treasury Regulations Section 1.1275-3(b)(i) that is applicable to such Holder, the Trusteeshall forward such request to the Issuer and the Issuer shall cause its Independent accountants toprovide promptly to the Trustee and such requesting Holder all of such information. Anyissuance of additional notes or replacement notes or incurrence of additional loans shall beaccomplished in a manner that shall allow the Independent accountants of the Issuer toaccurately calculate original issue discount income to holders (including such additional notes,replacement notes or additional loans).
The Issuer and the Income Note Issuer (or the Investment Manager acting(e)on their behalf) will take such reasonable actions consistent with law and their obligations underthis Indenture, the Income Note Paying Agency Agreement or the Investment ManagementAgreement, as are necessary for each to achieve FATCA Compliance, including hiring agents,advisors or representatives to perform due diligence, withholding or reporting obligations of theIssuer and the Income Note Issuer pursuant to FATCA, and any other action that the Issuer or theIncome Note Issuer would be permitted to take under this Indenture, the Income Note PayingAgency Agreement or the Investment Management Agreement in furtherance of achievingFATCA Compliance. The Issuer and the Income Note Issuer shall provide any certification ordocumentation (including the applicable IRS Form W-8BEN-E, or any successor form) to anypayor (as defined in FATCA) from time to time as provided by law to minimize U.S.withholding tax or backup withholding tax.
[Reserved].(f)
(i) The Issuer (or its Independent certified public accountant on its behalf)(g)shall establish and maintain or cause to be established and maintained on the books and recordsof the Issuer an individual capital account for each holder of Subordinated Notes (or any otherDebtNotes or interests in the Issuer that are treated as equity in the Issuer for U.S. federal incometax purposes) in accordance with section 704(b) of the Code and Treasury regulations section1.704-1(b)(2)(iv).
For capital account purposes, all items of income, gain, loss and deduction(ii)shall be allocated among the holders of Subordinated Notes (and any other DebtNotes orinterests in the Issuer that are treated as equity in the Issuer for U.S. federal income taxpurposes) in a manner such that, if the Issuer were dissolved, its affairs wound up, its
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liabilities satisfied in full (except that nonrecourse liabilities with respect to an asset shallbe satisfied only to the extent that such nonrecourse liabilities do not exceed the bookvalue of such asset, as reflected in the capital accounts of the Issuer) and its assetsdistributed to such holders in accordance with their respective capital account balancesimmediately after making such allocation, such distributions would, as nearly as possible,be equal to the distributions that would be made pursuant to the provisions of thisIndenture and Security Agreement. Any special allocations provided for in this Section 7.16(g) shall be taken into account for capital account purposes.
For U.S. federal, state and local income tax purposes, items of income,(iii)gain, loss, deduction and credit shall be allocated to the holders of Subordinated Notes(and any other DebtNotes or interests in the Issuer that are treated as equity in the Issuerfor U.S. federal income tax purposes) in accordance with the allocations of thecorresponding items for capital account purposes under this Section 7.16(g), except thatitems with respect to which there is a difference between tax and book basis will beallocated in accordance with Section 704(c) of the Code, the Treasury regulationsthereunder, and Treasury regulations section 1.704-1(b)(4)(i).
The provisions of this Section 7.16(g) relating to the maintenance of(iv)capital accounts are intended to comply with Treasury regulations section 1.704-1(b) andshall be interpreted and applied in a manner consistent with such regulations. The taxmatters partner shall be authorized to make appropriate amendments to the allocations ofitems pursuant to this Section 7.16(g) if necessary in order to comply with section 704 ofthe Code or applicable Treasury regulations thereunder.
Notwithstanding any other provision set forth in this Section 7.16(g), no(v)item of deduction or loss shall be allocated to a holder of Subordinated Notes (or anyother DebtNotes or interests in the Issuer that are treated as equity in the Issuer for U.S.federal income tax purposes) to the extent the allocation would cause a negative balancein such holder’s capital account (after taking into account the adjustments, allocationsand distributions described in Treasury regulations sections 1.704-1(b)(2)(ii)(d)(4), (5)and (6)) that exceeds the amount that such holder would be required to reimburse theIssuer pursuant to this Indenture and Security Agreement or under applicable law. In theevent some but not all of the holders of Subordinated Notes (or any other DebtNotes orinterests in the Issuer that are treated as equity in the Issuer for U.S. federal income taxpurposes) would have such excess capital account deficits as a consequence of such anallocation of loss or deduction, the limitation set forth in this Section 7.16(g)(v) shall beapplied on a holder by holder basis so as to allocate the maximum permissible deductionor loss to each such holder under Treasury regulations section 1.704-1(b)(2)(ii)(d). In theevent any loss or deduction is specially allocated to a holder pursuant to either of the twopreceding sentences, an equal amount of income of the Issuer shall be specially allocatedto such holder prior to any allocation pursuant to Section 7.16(g)(ii).
In the event any holder of Subordinated Notes (or any other DebtNotes or(vi)interests in the Issuer that are treated as equity in the Issuer for U.S. federal income taxpurposes) unexpectedly receives any adjustments, allocations, or distributions describedin Treasury regulations sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Issuer
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income and gain shall be specially allocated to such holder in an amount and mannersufficient to eliminate as quickly as possible any deficit balance in its capital account inexcess of that permitted under Section 7.16(g)(v) created by such adjustments,allocations or distributions. Any special allocations of items of income or gain pursuantto this Section 7.16(g)(vi) shall be taken into account in computing subsequentallocations pursuant to this Section 7.16(g)(vi) so that the net amount of any items soallocated and all other items allocated to each holder pursuant to this Section 7.16(g)shall, to the extent possible, be equal to the net amount that would have been allocated toeach such holder pursuant to the provisions of this Section 7.16(g) if such unexpectedadjustments, allocations or distributions had not occurred.
In the event the Issuer incurs any nonrecourse liabilities, income and gain(vii)shall be allocated in accordance with the “minimum gain chargeback” provisions ofTreasury regulations sections 1.704-1(b)(4)(iv) and 1.704-2.
All elections, decisions and other matters concerning the U.S. federal(viii)income tax allocations of profits, gains and losses among the holders of SubordinatedNotes (and any other DebtNotes or interests in the Issuer that are treated as equity in theIssuer for U.S. federal income tax purposes), and accounting procedures, not specificallyand expressly provided for by the terms of this Indenture and Security Agreement, shallbe determined by the tax matters partner in its discretion. Such determination by the taxmatters partner shall, absent manifest error, be final and conclusive as to all such holders.
The [Initial Majority Subordinated Noteholder] shall be the initial “tax(h)matters partner” (as defined in section 6231(a)(7) of the Code prior to amendment by P.L. 114-74) and “partnership representative” (as defined in section 6223 of the Code, after amendment by P.L. 114-74) (in either capacity, the “Partnership Representative”) (or, if not eligible under the Code to be the Partnership Representative, the agent and attorney-in-fact of the Partnership Representative) (and may designate the tax matters partner or Partnership Representative, as applicable, from time to time from among any holder of Subordinated Notes(including itself and any of its Affiliates) with respect to any taxable year of the Issuer duringwhich the Initial Majority Subordinated Noteholder or any of its Affiliates holds or has held anySubordinated Notes) for the Issuer for all U.S. federal income tax purposes set forth in the Codewith the power and authority to take all actions and do such things as required or as it shall deemappropriate under the Code or regulations promulgated thereunder. For so long as it is qualifiedto be so, the tax matters partner or Partnership Representative shall be the tax matters partner forpurposes of section 6231(a)(7), or section 6223, of the Code; provided, that during any otherperiod the Initial Majority Subordinated Noteholder is not the tax matters partner or Partnership Representative (or the Initial Majority Subordinated Noteholder declines to designate a taxmatters partner or Partnership Representative as provided in the preceding sentence), the Issuer(after consultation with the Investment Manager) will designate the tax matters partner or Partnership Representative from among any holder of Subordinated Notes (excluding the InitialMajority Subordinated Noteholder and its Affiliates). Further, the tax matters partner or Partnership Representative shall sign the Issuer’s tax returns and is authorized to make taxelections on behalf of the Issuer in its reasonable discretion, to determine the amount andcharacterization of any allocations or tax items described in the Indenture and Security Agreement in its reasonable discretion, and to take all actions and do such things as required or
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as it shall deem appropriate under the Code, at the Issuer’s sole expense, including representingthe Issuer before taxing authorities and courts in tax matters affecting the Issuer and thebeneficial owners of the Subordinated Notes (as determined for U.S. federal income taxpurposes) in their capacity as partners in the Issuer. Any action taken by the tax matters partneror Partnership Representative in connection with audits of the Issuer under the Code will, to theextent permitted by law, be binding upon the “equity owners” (for U.S. federal income taxpurposes) of the Issuer. Each such equity owner will agree that it will not treat any Issuer iteminconsistently on such equity owner’s individual income tax return with the treatment of the itemon the Issuer’s tax return and that such equity owner will not independently act with respect totax audits or tax litigation affecting the Issuer, unless previously authorized to do so in writingby the tax matters partner and the Investment Manager, which authorization may be withheld inthe complete discretion of the tax matters partner or Partnership Representative or theInvestment Manager. The Issuer will reimburse the tax matters partner or Partnership Representative in connection with any expenses reasonably incurred in connection with the taxmatters partner’s or Partnership Representative’s performance of its duties as tax matters partner or Partnership Representative. For the avoidance of doubt, any indemnity or reimbursementprovided pursuant to the immediately foregoing sentence shall be treated as an AdministrativeExpense described in clause fifth of the definition thereof.
Prior to the time that:(i)
the Issuer would acquire or receive any asset in connection with a(A)workout or restructuring of a Collateral Obligation that, in either case, couldcause the Issuer to be treated as engaged in a trade or business in the UnitedStates or otherwise cause the Income Note Issuer to be subject to U.S. federal taxon a net income basis for U.S. federal income tax purposes, or
any Collateral Obligation is modified in a manner that could cause(B)the Issuer to be treated as engaged in a trade or business in the United States orotherwise cause the Income Note Issuer to be subject to U.S. federal tax on a netincome basis for U.S. federal income tax purposes,
the Issuer will either (x) organize an Issuer Subsidiary and contribute to the Issuer Subsidiary theright to receive such asset or the Collateral Obligation that is the subject of the workout,restructuring, or modification, (y) contribute to an existing Issuer Subsidiary the right to receivesuch asset or the Collateral Obligation that is the subject of the workout, restructuring, ormodification, or (z) sell the right to receive such asset or the Collateral Obligation that is thesubject of the workout, restructuring, or modification, in each case unless the Issuer receiveswritten advice of White & Case LLP orCadwalader, Wickersham & Taft LLP, Winston andStrawn LLP, or a written opinion of other nationally recognized U.S. tax counsel experienced insuch matters, to the effect that the acquisition, ownership, and disposition of such asset, or thatthe workout, restructuring, or modification of such Collateral Obligation (as the case may be),will not cause the Issuer to be treated as engaged in a trade or business in the United States forU.S. federal income tax purposes or otherwise cause the Income Note Issuer to be subject to U.S.federal income tax on a net income basis. The Issuer (or the Investment Manager on behalf ofthe Issuer) shall provide to Moody’s and Fitch notice of the formation of any Issuer Subsidiary.
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Notwithstanding Section 7.16(i), the Issuer shall not acquire any asset(j)(including an asset that may otherwise qualify as a Collateral Obligation) if a restructuring,workout, or modification of such asset proposed to be acquired is in process and if suchrestructuring, workout, or modification could reasonably result in the Issuer being treated asengaged in a trade or business in the United States or subject to U.S. federal tax on a net incomebasis (either because of a modification of the asset or because the Issuer would receive anotherasset in connection with the restructuring or workout that would cause the Issuer to be treated asengaged in a trade or business in the United States or otherwise cause the Income Note Issuer tobe subject to U.S. federal income tax on a net income basis).
Each Issuer Subsidiary must at all times have at least one independent(k)director meeting the requirements of an “Independent Director” as set forth in the IssuerSubsidiary’s organizational documents complying with any applicable Rating Agency ratingcriteria. The Issuer shall cause the purposes and permitted activities of any Issuer Subsidiary tobe restricted solely to the acquisition, receipt, holding, management and disposition of CollateralObligations referred to in Section 7.16(i)(A) and Section 7.16(i)(B) and any assets, income andproceeds received in respect thereof (collectively, “Issuer Subsidiary Assets”), and shall requireeach Issuer Subsidiary to distribute 100% of the net proceeds of any sale of such IssuerSubsidiary Assets, net of any tax or other liabilities, to the Issuer. No supplemental indenture and security agreement pursuant to Section 8.1 or Section 8.2 hereof shall be necessary to permitthe Issuer, or the Investment Manager on its behalf, to take any actions necessary to set up anIssuer Subsidiary.
[Reserved].(l)
With respect to any Issuer Subsidiary:(m)
the Issuer shall not allow such Issuer Subsidiary to (A) purchase any(i)assets, or (B) acquire title to real property or a controlling interest in any entity that ownsreal property;
the Issuer shall ensure that such Issuer Subsidiary shall not sell, transfer,(ii)exchange or otherwise dispose of, or pledge, mortgage, hypothecate or otherwiseencumber (or permit such to occur or suffer such to exist), any part of such IssuerSubsidiary’s Issuer Assets, except as expressly permitted by this Indenture and Security Agreement and the Investment Management Agreement;
the Issuer Subsidiary shall not elect to be treated as a “real estate(iii)investment trust” for U.S. Federal income tax purposes;
the Issuer shall ensure that such Issuer Subsidiary shall not (A) have any(iv)employees (other than its directors), (B) have any subsidiaries (other than any subsidiaryof such Issuer Subsidiary which is subject, to the extent applicable, to covenants set forthin this Section 7.16 applicable to an Issuer Subsidiary), or (C) incur or assume orguarantee any indebtedness or hold itself out as liable for the debt of any other Persons;
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the Issuer shall ensure that such Issuer Subsidiary shall not conduct(v)business under any name other than its own;
the constitutive documents of such Issuer Subsidiary shall provide that(vi)recourse with respect to costs, expenses or other liabilities of such Issuer Subsidiary shallbe solely to the assets of such Issuer Subsidiary and no creditor of such Issuer Subsidiaryshall have any recourse whatsoever to the Issuer or its assets except to the extentotherwise required under applicable law;
the Issuer shall ensure that such Issuer Subsidiary shall file all tax returns(vii)and reports required to be filed by it and to pay all taxes required to be paid by it;
the Issuer shall notify the Trustee of the filing or commencement of any(viii)action, suit or proceeding by or before any arbiter or governmental authority against oraffecting such Issuer Subsidiary;
the Issuer shall ensure that such Issuer Subsidiary shall not enter into any(ix)agreement or other arrangement that prohibits or restricts or imposes any condition uponthe ability of such Issuer Subsidiary to pay dividends or other distributions with respectto any of its ownership interests;
the Issuer shall be permitted to take any actions and enter into any(x)agreements to effect the transactions contemplated by Section 7.16(i) so long as they donot violate Section 7.16(c);
the Issuer shall keep in full effect the existence, rights and franchises of(xi)such Issuer Subsidiary as a company or corporation organized under the laws of itsjurisdiction and shall obtain and preserve its qualification to do business in eachjurisdiction in which such qualification is or shall be necessary to preserve the IssuerSubsidiary Assets held from time to time by such Issuer Subsidiary. In addition, theIssuer and such Issuer Subsidiary shall not take any action, or conduct its affairs in amanner, that is likely to result in the separate existence of such Issuer Subsidiary beingignored or in its assets and liabilities being substantively consolidated with any otherPerson in a bankruptcy, reorganization or other insolvency proceeding. Notwithstandingthe foregoing, the Issuer shall be permitted to dissolve any Issuer Subsidiary at any time;
the parties hereto agree that any reports prepared by the Collateral Agent, (xii)the Trustee, the Investment Manager or the Collateral Administrator with respect to theCollateral Obligations shall indicate that any Issuer Subsidiary Assets are held by anIssuer Subsidiary, and shall refer directly and solely to such Issuer Subsidiary Assets, andthe Trustee shall not be obligated to refer to the equity interest in such Issuer Subsidiary;
the Issuer, the Co-Issuer, the Investment Manager, the Collateral Agent(xiii)and the Trustee shall not cause the filing of a petition in bankruptcy against the IssuerSubsidiary for the nonpayment of any amounts due hereunder until at least one year andone day, or any longer applicable preference period then in effect plus one day, after thepayment in full of all the Notes issued under this Indenture and Security Agreement;
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provided that nothing in this Section 7.16(m)(xiii) shall preclude the Collateral AgentTrustee from (i) exercising its rights as a secured or unsecured creditor in anyProceeding involving the Issuer Subsidiary (other than any Proceeding filed orcommenced by the Trustee) or (ii) while an Event of Default is continuing, commencingagainst the TaxIssuer Subsidiary or any of its properties any legal action which is not abankruptcy, reorganization, arrangement, insolvency, moratorium or liquidationProceeding; provided that any recovery of any amount received by the Collateral AgentTrustee under the preceding clause (i) or (ii) shall be distributed in accordance withthe Priority of Payments;
in connection with the organization of such Issuer Subsidiary and the(xiv)contribution of any assets to such Issuer Subsidiary pursuant to Section 7.16(i), the IssuerSubsidiary shall establish one or more custodial and/or collateral accounts, as necessary,with the Bank or a financial institution meeting the requirements of Section 10.5(a) tohold the Issuer Subsidiary Assets and any proceeds thereof pursuant to an account controlagreement; provided that (A) an Issuer Subsidiary Asset shall not be required to be heldin such a custodial or collateral account if doing so would be in violation of anotheragreement related to such Issuer Subsidiary Asset or any other asset and (B) the Issuermay pledge an Issuer Subsidiary Asset to a Person other than the Trustee if requiredpursuant to a related reorganization or bankruptcy Proceeding;
subject to the other provisions of this Indenture and Security Agreement,(xv)the Issuer shall cause the Issuer Subsidiary to distribute, or cause to be distributed, theproceeds of Issuer Subsidiary Assets to the Issuer, in such amounts and at such times asshall be determined by the Investment Manager (any Cash proceeds distributed to theIssuer shall be deposited into the Principal Collection Subaccount or the InterestCollection Subaccount, as applicable, as determined in accordance with subclause (xvi));provided that the Issuer shall not cause any amounts to be so distributed unless allamounts in respect of any related tax liabilities and expenses have been paid in full orhave been properly reserved for in accordance with GAAP;
notwithstanding the complete and absolute transfer of an Issuer Subsidiary(xvi)Asset to an Issuer Subsidiary, for purposes of measuring compliance with theConcentration Limitations, Portfolio Quality Test, and Coverage Tests, the ownershipinterests of the Issuer in such Issuer Subsidiary or any property distributed to the Issuerby the Issuer Subsidiary (other than Cash) shall be treated as ownership of the IssuerSubsidiary Asset(s) owned by such Issuer Subsidiary (and shall be treated as having thesame characteristics as such Issuer Subsidiary Asset(s) or of any asset received inconsideration of such Issuer Subsidiary Asset(s)). If, prior to its transfer to an IssuerSubsidiary, any asset was a Defaulted Obligation, the ownership interests of the Issuer insuch Issuer Subsidiary shall be treated as a Defaulted Obligation until such IssuerSubsidiary Asset would have ceased to be a Defaulted Obligation if owned directly bythe Issuer;
any distribution of Cash by such Issuer Subsidiary to the Issuer shall be(xvii)characterized as Interest Proceeds or Principal Proceeds to the same extent that such Cash
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would have been characterized as Interest Proceeds or Principal Proceeds if receiveddirectly by the Issuer;
if (A) any Event of Default occurs, the Debt hasNotes have been declared(xviii)due and payable (and such declaration shall not have been rescinded and annulled inaccordance with this Indenture and Security Agreement), and the Trustee or any otherauthorized party takes any action under this Indenture and Security Agreement to sell,liquidate or dispose of the Collateral, (B) notice is given of any Optional Redemption,redemption following a Tax Event or other prepayment in full or repayment in full of allDebtNotes Outstanding occurs and such notice is not capable of being rescinded, (C) theStated Maturity has occurred or will occur within five (5) Business Days, or (D)irrevocable notice is given of any other final liquidation and final distribution of theAssets, however described, the Issuer or the Investment Manager on the Issuer’s behalfshall (x) with respect to each Issuer Subsidiary, instruct such Issuer Subsidiary to selleach Issuer Subsidiary Asset and all other assets held by such Issuer Subsidiary for theIssuer and distribute the proceeds of such sale, net of any amounts necessary to satisfyany related expenses and tax liabilities, to the Issuer in exchange for the equity securityof or other interest in such Issuer Subsidiary held by the Issuer or (y) sell its interest insuch Issuer Subsidiary; and
the Issuer shall not dispose of any interest in an Issuer Subsidiary, and no(xix)Issuer Subsidiary shall make any distributions to the Issuer, if (A) such interest is a“United States real property interest,” as defined in Section 897(c) of the Code, and (B)the Issuer would be treated as engaged in a trade or business in the United States for U.S.federal income tax purposes as a result of such disposition or distribution.
Each contribution of an asset by the Issuer to an Issuer Subsidiary as(n)provided in this Section 7.16 may be effected by means of granting a participation interest insuch asset to the Issuer Subsidiary, if such grant transfers ownership of such asset to the IssuerSubsidiary for U.S. federal income tax purposes based on written advice of White & CaseCadwalader, Wickersham & Taft LLP or, Winston & Strawn LLP or an opinion of other taxcounsel of nationally recognized standing in the United States experienced in such matters.
No more than 50% of the debt obligations (as determined for U.S. federal(o)income tax purposes) held by the Issuer shall at any time consist of real estate mortgages asdetermined for purposes of Section 7701(i) of the Code unless, upon advice or opinion of White & CaseCadwalader, Wickersham & Taft LLP or, Winston & Strawn LLP, or a written opinion ofother nationally recognized U.S. tax counsel experienced in such matters, the ownership of suchdebt obligations will not cause the Issuer to be treated as a taxable mortgage pool for U.S.federal income tax purposes.
If the Issuer is aware that it has purchased an interest in a “reportable(p)transaction” within the meaning of Section 6011 of the Code, and a Holder of the Class E Notes,the Class F Notes or the Subordinated Notes requests in writing information about any suchtransactions in which the Issuer is an investor, the Issuer shall provide, or cause its Independentaccountants to provide, such information it has reasonably available that is required to beobtained by such Holder under the Code as soon as practicable after such request.
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Ramp-Up Period; Purchase of Additional Collateral Obligations.Section 7.17(a) During the Ramp-Up Period, the Issuer shall use any amounts on deposit in the Ramp-UpAccount and/or Principal Proceeds in the Collection Account to purchase additional CollateralObligations. In addition, the Issuer shall use its commercially reasonable efforts to acquire suchCollateral Obligations that shall satisfy, as of the end of the Ramp-Up Period, the PortfolioQuality Test and the Par Value Ratio Tests.
Within 15 days after the end of the Ramp-Up Period (but in any event,(b)prior to the Determination Date relating to the second Payment Date), the Issuer shall provide, or(at the Issuer’s expense) cause the Investment Manager to provide, the following documents: (i)to each Rating Agency (in the case of delivery to Moody’s, via email [email protected] and in the case of delivery to Fitch, via email [email protected]), a report identifying the Collateral Obligations; and (ii) tothe Trustee, the Collateral Agent, the Loan Agent, the Placement Agent and each Rating Agency(in the case of delivery to Moody’s, via email to [email protected] and in the case ofdelivery to Fitch, via email to [email protected]), (x) a report of the CollateralAdministrator (A) confirming the issuer, Principal Balance, coupon/spread, Stated Maturity,Fitch Rating, Moody’s Default Probability Rating, Moody’s Rating, country of Domicile, LoanXID or CUSIP number (if applicable) and LIBOR floor (if applicable) with respect to eachCollateral Obligation as of the end of the Ramp-Up Period, and whether each CollateralObligation has settled and the purchase price of each unsettled Collateral Obligation and (B)confirming that as of the end of the Ramp-Up Period (1) the Par Value Ratio Tests were met, (2)the Portfolio Quality Test was met, (3) the Concentration Limitations were satisfied and (4) theAggregate Ramp-Up Par Condition was satisfied and (y) a certificate of the Issuer (A) certifyingthe satisfaction of the items set forth in (x)(B) above (based on an Accountants’ Report) and (B)specifying the procedures performed at the request of the Issuer. If such Accountants’ Reporthas been delivered to Moody’s and contains recalculations noting that the requirements set forthin the immediately foregoing subclause (x) have been met, and the Aggregate Ramp-Up ParCondition is satisfied, a written confirmation from Moody’s of its Initial Rating of the RatedDebtNotes rated by it shall be deemed to have been provided (a “Moody’s Effective Date Deemed Rating Confirmation”).
If, by the Determination Date relating to the second Payment Date, either(c)(1) there has occurred no Moody’s Effective Date Deemed Rating Confirmation or (2) Moody’shas not provided written confirmation of its Initial Ratings of each Class of the Rated DebtNotes(a “Moody’s Ramp-Up Failure”), then, on such date and/or on any date thereafter and inconjunction with any actions taken pursuant to Section 11.1(a)(i)(R), the Investment Manager,on behalf of the Issuer, shall instruct the Collateral AgentTrustee in writing to transfer amountsfrom the Ramp-Up Account and, if necessary, the Interest Collection Subaccount to the PrincipalCollection Subaccount (and with such funds the Issuer shall purchase additional CollateralObligations) in an amount sufficient to obtain from Moody’s a confirmation of its Initial Ratingsof each Class of the Rated DebtNotes rated by it (provided that the amount of such transferwould not result in deferral of interest with respect to the Class A ObligationsNotes or the ClassB Notes); provided that, in the alternative, the Investment Manager on behalf of the Issuer maytake such other action, including but not limited to, a Special Redemption and/or transferringamounts from the Ramp-Up Account and/or the Interest Collection Subaccount to the Principal
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Collection Subaccount as Principal Proceeds (for use in a Special Redemption), sufficient toobtain from Moody’s a confirmation of its Initial Ratings of each Class of the Rated DebtNotesrated by it).
The failure of the Issuer to satisfy the requirements of this Section 7.17(d)shall not constitute an Event of Default unless such failure would otherwise constitute an Eventof Default under Section 5.1(d) hereof and the Issuer, or the Investment Manager acting onbehalf of the Issuer, has acted in bad faith. At the written direction of the Issuer (or theInvestment Manager on behalf of the Issuer), the Collateral AgentTrustee shall apply amountsheld in the Ramp-Up Account to purchase additional Collateral Obligations during the Ramp-UpPeriod as described in clause (a) above. If at the end of the Ramp-Up Period, any amounts ondeposit in the Ramp-Up Account have not been applied to purchase Collateral Obligations, suchamounts shall be applied as described in Section 10.3(c).
Asset Quality Matrix. On or prior to the last day of the Ramp-Up Period,(e)the Investment Manager shall (i) determine which “row/column combination” of the AssetQuality Matrix shall apply on and after the last day of the Ramp-Up Period to the CollateralObligations for purposes of determining compliance with the Moody’s Diversity Test, theMaximum Moody’s Rating Factor Test and the Minimum Floating Spread Test, and if such“row/column combination” differs from the “row/column combination” chosen to apply as of theClosing Date, the Investment Manager shall so notify the Collateral Agent, the Trustee, the Loan Agent, Fitch and the Collateral Administrator. At any time on written notice of two BusinessDays to the Collateral Agent, the Trustee, the Loan Agent, the Collateral Administrator and theRating Agencies (in the case of delivery to Moody’s, via email to [email protected] in the case of delivery to Fitch, via email to [email protected]), theInvestment Manager may elect a different “row/column combination” of the Asset QualityMatrix to apply to the Collateral Obligations; provided, that if (i) the Collateral Obligations arecurrently in compliance with the Moody’s Diversity Test, the Maximum Moody’s Rating FactorTest and the Minimum Floating Spread Test, the Collateral Obligations comply with suchapplicable tests after giving effect to such proposed election, or (ii) the Collateral Obligations arenot currently in compliance with the Moody’s Diversity Test, the Maximum Moody’s RatingFactor Test and the Minimum Floating Spread Test or would not be in compliance with suchapplicable tests after the application of any other Asset Quality Matrix case, the CollateralObligations need not comply with such applicable tests after the proposed change so long as thedegree of non-compliance of each of the Moody’s Diversity Test, the Maximum Moody’s RatingFactor Test and the Minimum Floating Spread Test would be maintained or improved if theAsset Quality Matrix case to which the Investment Manager desires to change is used; providedthat if subsequent to such election of a “row/column combination” of the Asset Quality Matrixthe Collateral Obligations would comply with the Moody’s Diversity Test, the MaximumMoody’s Rating Factor Test and the Minimum Floating Spread Test if a different Asset QualityMatrix case were selected, the Investment Manager shall elect a “row/column combination” thatcorresponds to a Asset Quality Matrix case in which the Collateral Obligations are in compliancewith such tests. If the Investment Manager does not notify the Collateral Agent, the Trustee, the Loan Agent, Fitch and the Collateral Administrator that it will alter the “row/column combination” of the Asset Quality Matrix chosen on the last day of the Ramp-Up Period in themanner set forth above, the “row/column combination” of the Asset Quality Matrix chosen onthe last day of the Ramp-Up Period shall continue to apply. Notwithstanding the foregoing, the
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Investment Manager may elect at any time after the last day of the Ramp-Up Period, in lieu ofselecting a “row/column combination” of the Asset Quality Matrix (but otherwise in compliancewith the requirements of the fourth sentence of this Section 7.17(e) to interpolate between twoadjacent rows and/or two adjacent columns, as applicable, on a straight-line basis and round theresults to two decimal points.
Representations Relating to Security Interests in the Assets. (a)Section 7.18The Issuer hereby represents and warrants that, as of the Closing Date (which representationsand warranties shall survive the execution of this Indenture and Security Agreement and bedeemed to be repeated on each date on which an Asset is Granted to the Collateral AgentTrusteehereunder), with respect to the Assets:
The Issuer owns such Asset free and clear of any lien, claim or(i)encumbrance of any person, other than such as are created under, or permitted by, thisIndenture and Security Agreement.
Other than the security interest Granted to the Collateral AgentTrustee(ii)pursuant to this Indenture and Security Agreement and the Credit Agreement, except aspermitted by this Indenture and Security Agreement and the Credit Agreement, the Issuerhas not pledged, assigned, sold, granted a security interest in, or otherwise conveyed anyof the Assets. The Issuer has not authorized the filing of and is not aware of anyFinancing Statements against the Issuer that include a description of collateral coveringthe Assets other than any Financing Statement relating to the security interest granted tothe Collateral AgentTrustee hereunder or that has been terminated; the Issuer is not awareof any judgment, PBGC liens or tax lien filings against the Issuer.
All Assets constitute Cash, accounts (as defined in Section 9-102(a)(2) of(iii)the UCC), Instruments, general intangibles (as defined in Section 9-102(a)(42) of theUCC), Uncertificated Securities, Certificated Securities or security entitlements toFinancial Assets resulting from the crediting of Financial Assets to a “securities account”(as defined in Section 8-501(a) of the UCC).
All Accounts constitute “securities accounts” under Section 8-501(a) of(iv)the UCC, or “deposit accounts” under Section 9-102(a)(29) of the UCC.
This Indenture and Security Agreement creates a valid and continuing(v)security interest (as defined in Section 1-201(37) of the UCC) in such Assets in favor ofthe Collateral AgentTrustee, for the benefit and security of the Secured Parties, whichsecurity interest is prior to all other liens, claims and encumbrances (except as permittedotherwise in this Indenture and Security Agreement), and is enforceable as such againstcreditors of and purchasers from the Issuer.
The Issuer hereby represents and warrants that, as of the Closing Date(b)(which representations and warranties shall survive the execution of this Indenture and Security Agreement and the Credit Agreement and be deemed to be repeated on each date on which anAsset is Granted to the Collateral AgentTrustee hereunder), with respect to Assets that constituteInstruments:
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Either (x) the Issuer has caused or shall have caused, within ten days of(i)the Closing Date, the filing of all appropriate Financing Statements in the proper office inthe appropriate jurisdictions under applicable law in order to perfect the security interestin the Instruments granted to the Collateral AgentTrustee, for the benefit and security ofthe Secured Parties, hereunder or (y)(A) all original executed copies of each promissorynote or mortgage note that constitutes or evidences the Instruments have been deliveredto the Collateral AgentTrustee or the Issuer has received written acknowledgement froma custodian that such custodian is holding the mortgage notes or promissory notes thatconstitute evidence of the Instruments solely on behalf of the Collateral AgentTrusteeand for the benefit of the Secured Parties and (B) none of the Instruments that constituteor evidence the Assets has any marks or notations indicating that they have been pledged,assigned or otherwise conveyed to any Person other than the Collateral AgentTrustee, forthe benefit of the Secured Parties.
The Issuer has received all consents and approvals required by the terms(ii)of the Assets to the pledge hereunder to the Collateral AgentTrustee of its interest andrights in the Assets that constitute Instruments.
The Issuer hereby represents and warrants that, as of the Closing Date(c)(which representations and warranties shall survive the execution of this Indenture and Security Agreement and the Credit Agreement and be deemed to be repeated on each date on which anAsset is Granted to the Collateral AgentTrustee hereunder), with respect to the Assets thatconstitute Security Entitlements:
All of such Assets have been and shall have been credited to one of the(i)Accounts which are securities accounts within the meaning of Section 8-501(a) of theUCC. The Securities Intermediary for each Account has agreed to treat all assetscredited to such Accounts (other than General Intangiblesgeneral intangibles and Cash)as Financial Assets.
The Issuer has received all consents and approvals required by the terms(ii)of the Assets to the pledge hereunder to the Collateral AgentTrustee of its interest andrights in the Assets that constitute Security Entitlements.
Either (x) the Issuer has caused or shall have caused, within ten days of(iii)the Closing Date, the filing of all appropriate Financing Statements in the proper office inthe appropriate jurisdictions under applicable law in order to perfect the security interestgranted to the Collateral AgentTrustee, for the benefit and security of the Secured Parties,hereunder or (y)(A) the Issuer has delivered to the Collateral AgentTrustee a fullyexecuted Securities Account Control Agreement pursuant to which the Custodian hasagreed to comply with all instructions originated by the Collateral AgentTrustee relatingto the Accounts without further consent by the Issuer or (B) the Issuer has taken all stepsnecessary to cause the Custodian to identify in its records the Collateral AgentTrustee asthe person having a Security Entitlement against the Custodian in each of the Accounts.
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The Accounts are not in the name of any person other than the Issuer or(iv)the Collateral AgentTrustee. The Issuer has not consented to the Custodian to complywith the Entitlement Order of any person other than the Collateral AgentTrustee (and theIssuer prior to a notice of exclusive control being provided by the Collateral AgentTrustee).
The Issuer hereby represents and warrants that, as of the Closing Date(d)(which representations and warranties shall survive the execution of this Indenture and Security Agreement and be deemed to be repeated on each date on which an Asset is Granted to theCollateral AgentTrustee hereunder), with respect to Assets that constitute general intangibles:
The Issuer has caused or shall have caused, within ten days of the Closing(i)Date, the filing of all appropriate Financing Statements in the proper filing office in theappropriate jurisdictions under applicable law in order to perfect the security interest inthe Assets granted to the Collateral AgentTrustee, for the benefit and security of theSecured Parties, hereunder.
The Issuer has received, or shall receive, all consents and approvals(ii)required by the terms of the Assets to the pledge hereunder to the Collateral AgentTrustee of its interest and rights in the Assets that constitute general intangibles.
The Co-Issuers agree to promptly provide notice to the Rating Agencies if(e)they become aware of the breach of any of the representations and warranties contained in thisSection 7.18.
Acknowledgement of Investment Manager Standard of Care. TheSection 7.19Co-Issuers acknowledge that they shall be responsible for their own compliance with thecovenants set forth in this Article VII and that, to the extent the Co-Issuers have engaged theInvestment Manager to take certain actions on their behalf in order to comply with suchcovenants, the Investment Manager shall only be required to perform such actions in accordancewith the standard of care set forth in Section 2(b) of the Investment Management Agreement (orthe corresponding provision of any investment management agreement entered into as a result ofTHL Credit Advisors LLC no longer being the Investment Manager). The Co-Issuers furtheracknowledge and agree that, to the extent the Co-Issuers have engaged the Investment Managerto take certain actions on their behalf in order to comply with the covenants set forth in thisArticle VII, the Investment Manager shall have no obligation to take any action to cure anybreach of any such covenant set forth in this Article VII until such time as an Authorized Officerof the Investment Manager has actual knowledge of such breach.
Maintenance of Listing. So long as any Listed Notes remain Section 7.20Outstanding, the Co-Issuers shall use all reasonable efforts to maintain the listing of such Notes on the Irish Stock Exchange.Maintenance of Listing. If, in the sole judgment of the Investment Manager, the maintenance of the listing of any Class of Notes on any exchange on which the Notes are then listed is unduly onerous or burdensome to the Issuer or the Holders, the Issuer shall cause the Notes to be de-listed from such exchange and, if the Investment Manager so
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directs, cause the Notes to be listed on another exchange, as identified by the Investment Manager.
Section 3(c)(7) Procedures. In addition to the notices required toSection 7.21be given under Section 10.5, the Issuer shall take the following actions to ensure compliancewith the requirements of Section 3(c)(7) of the Investment Company Act (provided that suchprocedures and disclosures may be revised by the Issuer to be consistent with generally acceptedpractice for compliance with the requirements of Section 3(c)(7) of the Investment CompanyAct):
The Issuer shall, or shall cause its agent to request of DTC, and cooperate(a)with DTC to ensure, that (i) DTC’s security description and delivery order include a “3(c)(7)marker” and that DTC’s reference directory contains an accurate description of the restrictionson the holding and transfer of the Notes due to the Issuer’s reliance on the exemption toregistration provided by Section 3(c)(7) of the Investment Company Act, (ii) DTC send to itsparticipants in connection with the initial offering of the Notes, a notice that the Issuer is relyingon Section 3(c)(7) and (iii) DTC’s reference directory include each class of Notes (and theapplicable CUSIP numbers for the Notes ) in the listing of 3(c)(7) issues together with anattached description of the limitations as to the distribution, purchase, sale and holding of theNotes.
The Issuer shall, or shall cause its agent to, (i) ensure that all CUSIP(b)numbers identifying the Notes shall have a “fixed field” attached thereto that contains “3c7” and“144A” indicators and (ii) take steps to cause the Placement Agent to require that all “confirms”of trades of the Notes contain CUSIP numbers with such “fixed field” identifiers.
The Issuer shall, or shall cause its agent to, cause the Bloomberg screen or(c)screens containing information about the Notes to include the following language: (i) the “NoteBox” on the bottom of “Security Display” page describing the Notes shall state: “Iss’d Under144A/3(c)(7),” (ii) the “Security Display” page shall have the flashing red indicator “See OtherAvailable Information,” and (iii) the indicator shall link to the “Additional Security Information”page, which shall state that the securities “are being offered in reliance on the exemption fromregistration under Rule 144A of the Securities Act of 1933, as amended (the “Securities Act”) toPersons who are both (x) qualified institutional buyers (as defined in Rule 144A under theSecurities Act) and (y) qualified purchasers (as defined under Section 3(c)(7) under theInvestment Company Act of 1940).” The Issuer shall use commercially reasonable efforts tocause any other third-party vendor screens containing information about the Notes to includesubstantially similar language to clauses (i) through (iii) above.
FATCA Compliance. Upon written request, the Trustee, the Section 7.22Collateral Agent, the Loan Agent and the Registrar shall provide to the Issuer, the InvestmentManager, the Placement Agent or any agent thereof any information specified by such partiesregarding the Holders of the DebtNotes and payments on the DebtNotes that is reasonablyavailable to the Trustee, the Collateral Agent, the Loan Agent or the Registrar, as the case maybe, and may be necessary as determined by the Issuer to achieve FATCA Compliance, subject inall cases to Section 14.13.
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ARTICLE VIII
SUPPLEMENTAL INDENTURE AND SECURITY AGREEMENTSINDENTURES
Supplemental Indenture and Security AgreementsIndentures Section 8.1without Consent of Holders of DebtNotes. Without the consent of the Holders of any DebtNotesor any Hedge Counterparty (except as expressly set forth below), the Co-Issuers, whenauthorized by Board Resolutions, at any time and from time to time subject to the requirementprovided below in this Section 8.1 with respect to the ratings of any Class of Rated DebtNotes,may enter into one or more indenture and security agreementsindentures supplemental hereto in form satisfactory to the Trustee and the Collateral Agent for any of the following purposes:
to evidence the succession of another Person to the Issuer or the Co-Issuer(i)and the assumption by any such successor Person of the covenants of the Issuer or theCo-Issuer herein, and in the Notes, in the Credit Agreement and in the Class A Loans;
to add to the covenants of the Co-Issuers, or the Trustee or the Collateral (ii)Agent for the benefit of the Secured Parties or to surrender any right or power hereinconferred upon the Co-Issuers;
to convey, transfer, assign, mortgage or pledge any property to or with the(iii)Collateral AgentTrustee for the benefit of the Secured Parties or add to the conditions,limitations or restrictions on the authorized amount, terms and purposes of the issue,authentication and delivery of the Notes;
to evidence and provide for the acceptance of appointment hereunder by a(iv)successor trustee and/or collateral agent and to add to or change any of the provisions ofthis Indenture and Security Agreement as shall be necessary to facilitate theadministration of the trusts hereunder by more than one trustee and/or collateral agent,pursuant to the requirements of Sections 6.8, 6.9 and 6.11;
to correct or amplify the description of any property at any time subject to(v)the lien of this Indenture and Security Agreement, or to better assure, convey and confirmunto the Collateral AgentTrustee any property subject or required to be subjected to thelien of this Indenture and Security Agreement (including, without limitation, any and allactions necessary or desirable as a result of changes in law or regulations, whetherpursuant to Section 7.5 or otherwise) or to subject to the lien of this Indenture and Security Agreement any additional property;
(x) to modify the restrictions on and procedures for resales and other(vi)transfers of Notes to reflect any changes in ERISA or applicable law or regulation (or theinterpretation thereof) or, (y) to enable the Co-Issuers to rely upon any exemption fromERISA or registration under the Securities Act or the Investment Company Act or (z) toremove restrictions on resale and transfer to the extent not required thereunder;, subject to, in the case of clause (z), so long as the Initial Majority Subordinated Noteholder Condition is satisfied, the prior consent of the Initial Majority Subordinated Noteholder;
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provided, that, in each case, unless waived by the Initial Majority Subordinated Noteholder, any such modification or removal will not cause the Issuer to be treated as a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes;
to make such changes (including the removal and appointment of any (vii)listing agent in Ireland) as shallas will be necessary or advisable in order for the Listed Notes to be listedany Notes (other than the Class E Notes, the Class F Notes and the Subordinated Notes) to be or deremain listed on an exchange, including the Irish Stock Exchange; provided that the Co-Issuers may take any action to de-list any Class of Notes with the consent of the Investment Manager and a Majority of the Subordinated Notes;
at any time within the Reinvestment Period (or, in the case of an issuance (viii)of additional Subordinated Notes and/or Junior Mezzanine Notes only, at any time), to make such changes as are necessary to permit the Applicable Issuers (A) to issue Junior Mezzanine Notes; provided that any such additional issuance of Notes shall be issued in accordance with Section 2.4, (B) to issue additional Notes of any one or more existing Classes or incur additional Class A Loans; provided, further, that any such additional issuance of Notes or incurrence of such additional Class A Loans shall be issued or incurred in accordance with Section 2.4 hereto and the Credit Agreement, as applicable, or (C) to issue replacement securities in connection with a Refinancing in accordance with Section 9.2(a) or Section 9.3;with the consent of a Majority of the Subordinated Notes, (A) to effect the issuance of Additional Notes in accordance with the requirements set forth in Section 2.4 or participation notes, combination notes, composite securities and other similar securities in connection therewith, (B) to effect or facilitate any Optional Redemption or Refinancing in accordance with the requirements of Section 9.2 or 9.3 and, in connection with any such Refinancing, to amend or otherwise modify the Portfolio Quality Test or (C) to effect a Re-Pricing in accordance with the requirements of Section 9.9; provided that (I) any supplemental indenture pursuant to this clause without the consent of any Holders of Classes of Notes, may make any modification or amendment determined by the Invesment Manager (based on the advice of Winston & Strawn LLP or other nationally recognized counsel) to be necessary in order for a Re-Pricing or Refinancing not to be subject to, or not cause the Invesment Manager or any other “sponsor” (as defined for purposes of the U.S. Risk Retention Rules) to violate, the U.S. Risk Retention Rules and (II) with respect to a proposed supplemental indenture that amends or otherwise modifies the Portfolio Quality Test under clause (B) of this clause (viii) in connection with a Refinancing, either (1) Rating Agency confirmation has been obtained with respect to all Classes of Notes not subject to such Refinancing or (2) no objection thereto has been received by the Trustee from the Holders of a Majority of the Holders of the Class A Notes not subject to such Refinancing within 10 days’ notice of such proposed supplemental indenture;
to correct any inconsistency or cure any ambiguity, omission or errors (ix)either (A) in this Indenture and Security Agreement or (B) between the Credit Agreement and this Indenture and Security Agreement;
to conform the provisions of this Indenture and Security Agreement or the (x)Credit Agreement to the Offering Circular;
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to amend, modify, enter into or accommodate the execution of any Hedge(xi)Agreement, unless; provided that the Initial Majority Subordinated Noteholder (so longas the Initial Majority Subordinated Noteholder Condition is satisfied) objectshas consented to such supplemental indenture and security agreement;
to take any action advisable, necessary or helpful (1)(A) to prevent the(xii)Issuer, the Income Note Issuer, or any Issuer Subsidiary from beingbecoming subject to(or to otherwise minimize) withholding or other taxes, fees or assessments, including by complying with the Tax Account Reporting Rules, (B) to reduce the risk that the Issuermay be subject to tax liability under Section 1446 or Section 6221 of the Code (as amended by P.L. 114-74, effective January 1, 2018) or treated as a publicly tradedpartnership taxable as a corporation for U.S. federal income tax purposes, or (C) toreduce the risk that the Issuer, or the Income Note Issuer, or any Issuer Subsidiary maybe treated as engaged in a trade or business within the United States for U.S. federalincome tax purposes or otherwise subject to U.S. federal, state or local income tax on anet income basis, (2) to allow the Issuer or the Income Note Issuer to achieve Tax Account Reporting Rules Compliance (including the terms of a voluntary agreement entered into with a taxing authority) (including providing for remedies against or imposing penalties upon (or imposing separate CUSIPs on Notes held by) Holders who fail to comply with the Holder Reporting Obligations and (3) for any Bankruptcy Subordination Agreement, including to (x) issue a new Note or Notes in respect of, or issue one or more new sub-classes of, any Class of Notes, in each case with new identifiers (including CUSIPs, ISINs and Common Codes, as applicable), in connection with any Bankruptcy Subordination Agreement; provided that any sub-class of a Class of Notes issued pursuant to this clause shall be issued on identical terms as, and rank pari passu in all respects with, the existing Notes of such Class and (y) provide for procedures under which beneficial owners of such Class that are not subject to a Bankruptcy Subordination Agreement may take an interest in such new Note(s) or sub-class(es);
to modify the procedures herein relating to compliance with Rule 17g--5(xiii)of the Exchange Act;(xiv) to effect a Refinancing in conformity with Section 9.2(d) and Section 9.3 or a Re-Pricing in conformity with Section 9.9;under the Exchange Act or to permit compliance, or reduce the costs to the Co-Issuers of compliance, with the Dodd-Frank Wall Street Reform and Consumer Protection Act (as amended from time to time) and any rules or regulations thereunder applicable to the Co-Issuers, the Investment Manager or the Notes;
(xv) to amend, modify or otherwise accommodate changes to Section 7.13(xiv)relating to the administrative procedures for reaffirmation of ratings on the Debt, or to evidence any waiver by any Rating Agency as to any requirement in this Indenture and Security Agreement that such Rating Agency confirm (or to evidence any other elimination of any requirement in this Indenture and Security Agreement that any Rating Agency confirm) that an action or inaction by the Issuer or any other Person will not result in a reduction or withdrawal of its then current rating of any Class of Secured Debt as a condition to such action or inactionNotes;
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(xvi) to change the name of the Issuer or the Co-Issuer in connection with(xv)the change in name or identity of the Investment Manager or as otherwise requiredpursuant to a contractual obligation or to avoid the use of a trade name or trademark inrespect of which the Issuer or the Co-Issuer does not have a license;
(xvii) to facilitate the issuance of participation notes, combination notes,(xvi)composite securities, and other similar securities by the Applicable Issuers or to changethe minimum denominations of any Class of Notes unless so long as the Initial Majority Subordinated Noteholder Condition is satisfied, the Initial Majority Subordinated Noteholder objects to such supplemental indenture and security agreement;(xviii) (A) , subject to, so long as the Initial Majority Subordinated Noteholder Condition is satisfied, the consent of the Initial Majority Subordinated Noteholder to such supplemental indenture;
to modify or amend any component of the Asset Quality Matrix, the(xvii)restrictions on the sales of Collateral Obligations, the Investment CriteriaInvestment Criteria, the Concentration Limitations or the Portfolio Quality Tests and the definitionsrelated thereto which affect the calculation thereof in a manner that would not materially adversely affect any Holder of Debt, as evidenced by a certificate of an officer of the Investment Manager or an opinion of counsel (which may be supported as to factual (including financial and capital markets) matters by any relevant certificates and other documents necessary or advisable in the judgment of counsel delivering the opinion) and with respect to which the Global Rating Agency Condition is satisfied or (B) to modify the Concentration Limitation set forth in clause (x) of the definition of such term, in each case of the foregoing clauses (A) and (B), subject to (I) the prior consent (without duplication) of (1) a Majority of the Controlling Class and (2) the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder Condition is satisfied) and (II) if a Majority of any Class of Notes (other than the Controlling Class and, so long as the Initial Majority Subordinated Noteholder Condition is satisfied, the Subordinated Notes) has objected to such supplemental indenture and security agreement within 10 Business Days of receipt thereof, the prior consent of a Majority of each of such Class of Notes;; provided that, unless such modification or amendment is being made (A) to the Portfolio Quality Tests in connection with a Refinancing pursuant to clause (viii)(B) above or (B) in connection with a Refinancing of all Classes of Secured Notes in full as permitted under clause (ix)(B) above, written consent has been obtained from a Majority of the Subordinated Notes and, unless Rating Agency Confirmation is obtained with respect to such amendment or modification, the Holders of a Majority of the Class A Notes; provided, further, that, solely with respect to changes to the Asset Quality Matrix, Rating Agency Confirmation must be obtained with respect to such amendment or modification or, otherwise, notice is provided to the Rating Agencies;
(xix) to accommodate the settlement of the Notes in book-entry form(xviii)through the facilities of DTC or otherwise or the conversion of Class A Loans into Class A-1 Notes;
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(xx) to authorize the appointment of any listing agent, transfer agent,(xix)paying agent or additional registrar for any Class of Notes required or advisable inconnection with the listing of any Notes (other than the Class ofE Notes, the Class F Notes and the Subordinated Notes) on the Irish Stock Exchange or any other stockexchange, and otherwise to amend this Indenture and Security Agreement to incorporateany changes required or requested by any governmental authority, stock exchangeauthority, listing agent, transfer agent, paying agent or additional registrar for any Class of Notes in connection herewith;
(xxi) to make such other changes as the Co-Issuers deem appropriate and (xx)that do not materially and adversely affect the interests of any Holder of the Debt as evidenced by an Opinion of Counsel delivered to the Collateral Agent (which may be supported as to factual (including financial and capital markets) matters by any relevant certificates and other documents necessary or advisable in the judgment of counsel delivering the opinion) or a certificate of an Officer of the Investment Manager, unless any of (1) the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder Condition is satisfied) or (2) a Majority of the Controlling Class objects to such supplemental indenture and security agreement;accommodate the settlement of the Notes in book-entry form through the facilities of DTC or otherwise;
(xxii) to modify any provision to facilitate an exchange of one obligation for another obligation of the same Obligor that has substantially identical terms except transfer restrictions;
(xxiii) to modify the terms of this Indenture and Security Agreement to(xxi)conform to rating agencyratings criteria and other guidelines (including any alternativemethodology published by either of the Rating Agencies or any use of the Rating Agencies’ credit models or guidelines for ratings determination) relating tocollateralizedIssuer Subsidiaries and collateral debt obligations in general published by either of the Rating Agenciesor otherwise communicated by the applicable Rating Agency; provided, that the consent of a Majority of the Subordinated Notes has been obtained and either (A) Rating Agency Confirmation shall have been obtained or (B) if the Holders of a Majority of the Holders of the Class A Notes has objected to the proposed supplemental indenture under this clause within ten (10) Business Days of notice thereof, consent to such supplemental indenture has been obtained subsequent to such objection from a Majority of the Holders of the Class A Notes;
to evidence any waiver or elimination by any Rating Agency of any (xxii)requirement or condition of such Rating Agency set forth herein;
with the consent of the Investment Manager and a Majority of the (xxiii)Subordinated Notes, regardless of whether any Class would be materially and adversely affected thereby, to modify the Subordinated Management Fee or the Incentive Management Fee;
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in connection with the additional issuance of Notes, an Optional (xxiv)Redemption or a Re-Pricing, to make modifications that do not materially and adversely affect the rights or interests of holders of any Class and are determined by the Investment Manager to be necessary in order for such additional issuance of Notes, Optional Redemption, Refinancing or Re-Pricing to not be subject to the U.S. Risk Retention Rules, subject to the prior consent of a Majority of the Controlling Class and a Majority of the Subordinated Notes;
(xxiv) to change the date within the month on which the Monthly Report (xxv)or the Distribution Report are required to be delivered hereunder;base rate in respect of the Rated Notes from LIBOR to an alternate base rate (such rate, the “Alternate Base Rate”), to replace references to “LIBOR” and “London interbank offered rate” with the Alternate Base Rate when used with respect to a floating rate Collateral Obligation and make such other amendments as are necessary or advisable in the reasonable judgment of the Investment Manager to facilitate the foregoing changes; provided that (A) a Majority of the Holders of the Class A Notes and a Majority of the Subordinated Notes consents to such supplemental indenture and (B) such amendments and modifications are being undertaken due to (x) a material disruption to Libor, (y) a change in the methodology of calculating Libor or (z) Libor ceasing to exist (or the reasonable expectation of the Investment Manager that any of the events specified in clause (x), (y) or (z) will occur) (any such amendment pursuant to this clause (xxv), a “Base Rate Amendment”); provided, further, that, the foregoing supplemental indenture may be adopted without the consent of any holder if the Investment Manager directs, in its commercially reasonable discretion, that the Alternate Base Rate to replace LIBOR pursuant to such Base Rate Amendment shall be the Designated Base Rate; or
(xxv) to make any modification or amendment determined by the Issuer or the Investment Manager (in consultation with legal counsel of national reputation experienced in such matters) as necessary or advisable (A) for any Class of Secured Debt to not be considered an “ownership interest” as defined for purposes of the Volcker Rule or (B) for the Issuer to not otherwise be considered a “covered fund” as defined for purposes of the Volcker Rule, in each case so long (1) as any such modification or amendment would not have a material adverse effect on any Class of Debt, as evidenced by an opinion of counsel (which may be supported as to factual (including financial and capital markets) matters by any relevant certificates and other documents necessary or advisable in the judgment of the counsel delivering the opinion), and (2) such modification or amendment is approved in writing by each of (a) a Majority of the Section 13 Banking Entities (voting as a single class) and (b) a Majority of the Subordinated Notes; or
to enter into any additional agreements not expressly prohibited by this(xxvi)Indenture and Security Agreement as well as any amendment, modification or waiver to such additional agreements if the Issuer determines that such additional agreements or amendment, modification or waiver to such additional agreements would not, upon orafter becomingbecome effective, materially and adversely affect the rights or interests ofHolders of any Class of DebtNotes as evidenced by an opinion of counsel delivered to the
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Trustee (which may be supported as to factual (including financial and capital markets)matters by any relevant certificates and other documents necessary or advisable in thejudgment of counsel delivering such opinion of counsel) or an officer’s certificate of theInvestment Manager; provided that, that (A) any such additional agreements include customary limited recourse and non-petition provisions and (B) if a Majority of any of the Controllingthe Class, the Class B A Notes or a Majority of the Class CSubordinatedNotes has objected to such supplemental indenture and security agreement within ten (10) Business Days of receipt thereof, the affirmative consent of each ofdelivery of the notice of such supplemental indenture, consent to such supplemental indenture has been obtained subsequent to such objection from a Majority of the Controlling Class, the Class B Notes or the Class C Notes, as applicable, will be required prior to the execution of such supplemental indenture and security agreement.Notwithstanding the foregoing, without the prior written consent of 100% of the Section 13 Banking Entities and A Notes or a Majority of the Subordinated Notes, no supplemental indenture and security agreement, may modify the definition of “Collateral Obligations”, the definition of “Eligible Investments”, the definition of “Participation Interests”, the definition of “Section 13 Banking Entities”, the criteria required to enter into a Hedge Agreement, or the criteria required for additional issuance of notes, in each case, under this Indenture and Security Agreement.as applicable.
At the cost of the Co-Issuers, for so long as any Debt shall remain Outstanding, not later than 20 Business Days prior to the execution of any proposed supplemental indenture and security agreement pursuant to this Section 8.1, the Collateral Agent shall deliver to the Investment Manager, the Collateral Administrator, the Trustee, the Loan Agent, the Holders of Debt, the Placement Agent and the Rating Agencies (so long as any Rated Debt is Outstanding and are Rated by such Rating Agency) a copy of such supplemental indenture and security agreement.To the extent the Co-Issuers execute a supplemental indenture or other modification or amendment of this Indenture for purposes of correcting any inconsistency or curing any ambiguity, omission or error in this Indenture or conforming this Indenture to the Offering Circular pursuant to Section 8.1(ix) or (x) above and one or more other amendment provisions described above also applies, such supplemental indenture or other modification or amendment of this Indenture will be deemed to be a supplemental indenture, modification or amendment to correct any inconsistency or cure any ambiguity, omission or error in this Indenture or conform this Indenture to the Offering Circular pursuant to Section 8.1(ix) or (x) above regardless of the applicability of any other provision regarding supplemental indentures set forth in this Indenture.
Except as set forth above, the Trustee and the Collateral Agent shall join in theexecution of any such supplemental indenture and security agreement and to make any furtherappropriate agreements and stipulations which may be therein contained, but the Trustee and the Collateral Agent shall not be obligated to enter into any such supplemental indenture and security agreement which affects the Trustee’s or the Collateral Agent’s own rights, duties,liabilities or immunities under this Indenture and Security Agreement or otherwise, except to the extent required by law.
At the cost of the Co-Issuers, the Collateral AgentTrustee shall provide to theHolders, the Investment Manager, the Loan Agent (who shall forward to the Class A Lenders), and each Rating Agency (so long as any Rated Debt isNotes are Outstanding and are Ratedrated
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by such Rating Agency) and, for so long as any Notes are listed on the Irish Stock Exchange, the Irish Stock Exchange, a copy of the executed supplemental indenture and security agreement after its execution. Any failure of the Collateral AgentTrustee to publish or deliver such notice,or any defect therein, shall not, however, in any way impair or affect the validity of any suchsupplemental indenture and security agreement. The Trustee and the Collateral Agent may conclusively rely on an Opinion of Counsel (which may be supported as to factual (including financial and capital markets) matters by any relevant certificates and other documents necessary or advisable in the judgment of counsel delivering the opinion) and/or an Officer’s certificate of the Investment Manager as to whether the interests of any Holder of Debt would be materially and adversely affected by the modifications set forth in supplemental indenture and security agreement, it being expressly understood and agreed that the Trustee and the Collateral Agent shall have no obligation to make any determination as to the satisfaction of the requirements related to any supplemental indenture and security agreement which may form the basis of such Opinion of Counsel. Such determination shall be conclusive and binding on all present and future Holders. The Trustee and the Collateral Agent shall not be liable for any such determination made in good faith and in reliance upon an Opinion of Counsel delivered to the Trustee as described in Section 8.3 hereof..
A supplemental indenture and security agreement entered into for any purposeother than the purposes provided for in this Section 8.1 may be adopted as described in Section 8.2(a) and (b) withshall require the consent of the requisite percentage of the Holders of the applicable Classes of Debt (or, if such supplemental indenture and security agreement does not materially and adversely affect a Class of Debt, no consent from such Class of Debt shall be required)Holders of Notes to the extent required in Section 8.2.
Supplemental Indenture and Security AgreementsIndentures with Section 8.2Consent of Holders of DebtNotes. (a) With the consent of a Majority of each Class of Notes and a Majority of the Class A Lenders, in each case, materially and adversely affected thereby, theCollateral Agent, the Trustee and the Co-Issuers may enter into a supplemental indenture and security agreement to add any provisions to, or change in any manner or eliminate any of theprovisions of, this Indenture and Security Agreement or modify in any manner the rights of theHolders of the DebtNotes of such Class under this Indenture and Security Agreement; providedthat, no supplemental indenture and security agreement shall, without the consent of each Holderof each Outstanding Note of each Class and each Class A Lender (so long as the Class A Loans are Outstanding), in each case, materially and adversely affected thereby:
other than a change in connection with a Refinancing of all Classes of (i)Rated Notes pursuant to [Section 8.1(viii)(B)], change the Stated Maturity of theprincipal of or the due date of any installment of interest on any Rated DebtNotes, reducethe principal amount thereof or, other than in a Re-Pricing or a Base Rate Amendment,the rate of interest thereon or the Redemption Price with respect to any DebtNotes, orchange the earliest date on which DebtNotes of any Class may be redeemed or prepaid,change the provisions of this Indenture and Security Agreement relating to theapplication of proceeds of any Assets to the payment of principal of or interest on RatedDebt, amend the Priority of Payments as it relates to theNotes, application of proceeds ofany distributions on the Subordinated Notes (other than, following a redemption in full ofthe Rated DebtNotes, a required amendment to permit distributions to Holders of the
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Subordinated Notes on dates other than Payment Dates) or change any place where, orthe coin or currency in which, Subordinated Notes or Rated DebtNotes or the principalthereof or interest thereon is payable, or impair the right to institute suit for theenforcement of any such payment on or after the Stated Maturity thereof (or, in the caseof redemption, on or after the applicable Redemption Date);
changereduce the percentage of the Aggregate Outstanding Amount of(ii)Holders of Notes of each Class or Class A Lenders whose consent is required under thisIndenture and Security Agreement, including for the authorization of any suchsupplemental indenture and security agreement, exercise of remedies under this Indentureand Security Agreement or for any waiver of compliance with certain provisions of thisIndenture and Security Agreement or certain defaults hereunder or their consequences;
materially impair or materially adversely affect the Assets except as(iii)otherwise permitted in this Indenture and Security Agreement;
except as otherwise expressly permitted by this Indenture and Security (iv)Agreement, permit the creation of any lien ranking prior to or on a parity with the lien ofthis Indenture and Security Agreement with respect to any part of the Assets or terminatesuch lien on any property at any time subject hereto or deprive the Holder of any RatedDebtNotes of the security afforded by the lien of this Indenture and Security Agreement; provided that this clause shall not apply to any supplemental indenture in connection with a Refinancing where a lien is created in favor of a collateral agent or similar security agent in relation to the obligations providing the Refinancing Proceeds in the form of one or more loans ranking on a parity with one or more Classes of Notes also secured pursuant to the lien of this Indenture;
modify any of the provisions of this Article VIIISection 8.2, except to(v)increase the percentage of Outstanding Rated DebtNotes or Subordinated Notes theconsent of the Holders of which is required for any such action or to provide that certainother provisions of this Indenture and Security Agreement cannot be modified or waivedwithout the consent of each Holder of Rated DebtNotes or Subordinated NoteOutstanding and affected thereby;
modify the definitions of the terms “Outstanding,” “Class,” “Controlling(vi)Class,” “Majority” or “Supermajority”; provided, that this clause (vi) shall not apply to any modifications to the definitions of “Class” or “Controlling Class” necessary to effect any Optional Redemption, Refinancing, Re-Pricing or additional issuance of Notes in accordance with this Indenture;
other than in a Re-Pricing or a Base Rate Amendment, modify any of the(vii)provisions of this Indenture and Security Agreement in such a manner as to directlyaffect the calculation of the amount of any payment of interest or principal on any RatedDebtNotes, or any amount available for distribution to the Subordinated Notes or toaffect the rights of the Holders of Rated DebtNotes to the benefit of any provisions forthe redemption of such Rated DebtNotes contained herein;
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amend any of the provisions of this Indenture and Security Agreement(viii)relating to the institution of proceedings for certain events of bankruptcy, insolvency,receivership or reorganization of the Co-Issuers;(ix) modify the restrictions on and procedures for resales and other transfers of Debt (except as set forth in Section 8.1(vi));or
(x) modify the Priority of Payments.(ix)
(b) Execution of Supplemental Indentures. (a) Not later thanSection 8.3twentyten (2010) Business Days (or five (5) Business Days if in connection with an additional issuance of Notes, Optional Redemption or Re-Pricing) prior to the execution of any proposedsupplemental indenture and security agreement pursuant to Section 8.2(a),8.1 or Section 8.2, theCollateral AgentTrustee, at the expense of the Co-Issuers, shall mail to the Holders of the DebtNoteholders, the Investment Manager, the Collateral Administrator, the Trustee, the Loan Agent, any Hedge Counterparty and each Rating Agency (so long as any Rated Debt isNotes areOutstanding and isare rated by such Rating Agency) a copy of such proposed supplementalindenture and security agreement and shall request any required consent from the applicableHolders of DebtNotes to be given within twentyten (2010) Business Days (or five (5) Business Days if in connection with an additional issuance of Notes, Optional Redemption or Re-Pricing).Any consent given to a proposed supplemental indenture and security agreement by the holder ofany DebtNotes will be irrevocable and binding on all future holders or beneficial owners of thatDebtNote, irrespective of the execution date of the supplemental indenture and security agreement. If the Holders of less than the required percentage of the Aggregate OutstandingAmount of the relevant DebtNotes consent to a proposed supplemental indenture and security agreement within 20ten (10) Business Days (or five (5) Business Days if in connection with an additional issuance of Notes, Optional Redemption or Re-Pricing), on the first Business Dayfollowing such period, the Collateral AgentTrustee will provide consents received to the Issuerand the Investment Manager so that they may determine which Holders of DebtNotes haveconsented to the proposed supplemental indenture and security agreement and which Holders ofDebtNotes (and, to the extent such information is available to the Collateral AgentTrustee, whichbeneficial owners) have not consented to the proposed supplemental indenture and security agreement. Following such delivery by the Trustee, if any changes are made to such supplemental indenture other than changes of a technical nature or to correct typographical errors or to adjust formatting, then at the cost of the Co-Issuers, for so long as any Notes remain Outstanding, not later than five (5) Business Days prior to the execution of such proposed supplemental indenture (provided that the execution of such supplemental indenture shall not in any case occur earlier than the date ten (10) Business Days or five (5) Business Days, as applicable, after the initial distribution of such proposed supplemental indenture pursuant to the first sentence of this Section 8.3(a)), the Trustee shall deliver to the Investment Manager, the Collateral Administrator, each Hedge Counterparty, the Rating Agencies (if then rating a Class of Rated Notes) and the Holders a copy of such supplemental indenture as revised, indicating the changes that were made. If, prior to delivery by the Trustee of such supplemental indenture as revised, any Holder has provided its written consent to the supplemental indenture as initially distributed, such Holder shall be deemed to have consented in writing to the supplemental indenture as revised unless such Holder has provided written notice of its withdrawal of such
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consent to the Trustee and the Issuer not later than one (1) Business Day prior to the execution of such supplemental indenture.
(c) It shall not be necessary for any Act of Holders under this Section (b)8.28.3 to approve the particular form of any proposed supplemental indenture and security agreement, but it shall be sufficient if such Act or consent shall approve the substance thereof, solong as the Holders have received a copy of the language to be included in any proposedsupplemental indenture and security agreement.
(d) Promptly after the execution by the Co-Issuers, the Collateral Agent(c)and the Trustee of any supplemental indenture and security agreement pursuant to this Section 8.2,8.3, the Collateral AgentTrustee, at the expense of the Co-Issuers, shall deliver to theHolders, the Investment Manager, the Loan Agent (who shall forward to the Class A Lenders), and each Rating Agency (so long as any Rated Debt isNotes are Outstanding and are rated bysuch Rating Agency) and, for so long as any Notes are listed on the Irish Stock Exchange, the Irish Stock Exchange, a copy thereof. Any failure of the Collateral AgentTrustee to deliver acopy of any supplemental indenture and security agreement as provided herein, or any defecttherein, shall not, however, in any way impair or affect the validity of any such supplementalindenture and security agreement.
(e) The Trustee and the Collateral Agent may conclusively rely on an(d)Opinion of Counsel (which may be supported as to factual (including financial and capitalmarkets) matters by any relevant certificates and other documents necessary or advisable in thejudgment of the counsel delivering the opinion) and/or an Officer’s certificate of the InvestmentManager as to whether the interests of any Holder of DebtNotes would be materially andadversely affected by the modifications set forth inany supplemental indenture and security agreementor other modification or amendment of this Indenture, it being expressly understoodand agreed that the Trustee and the Collateral Agent shall have no obligation to make anydetermination as to the satisfaction of the requirements related to any supplemental indentureand security agreement which may form the basis of such Opinion of Counsel; provided that if the Trustee, the Collateral Agent and the Issuer are notified (within 20 Business Days after notice by the Collateral Agent to the Holders of a proposed supplemental indenture and security agreement) by a Majority of any Class that such Holders believe the interests of the Holders in such Class of Debt will be materially and adversely affected by the proposed supplemental indenture and security agreement pursuant to the provisions described above in this Section 8.2(e), the interests of such Class will be deemed to be materially and adversely affected by such proposed supplemental indenture and security agreement pursuant to the provisions described herein. The determinations made pursuant to this clause shall be conclusive and binding on allpresent and future Holders. The Trustee and the Collateral Agent shall not be liable for any suchdetermination made in good faith and in reliance upon an Opinion of Counsel delivered to theTrustee as described in Section 8.3 hereof. For the avoidance of doubt, the failure to satisfy the Global Rating Agency Condition shall not prevent the execution or effectiveness of any supplemental indenture and security agreement.
Section 8.3 Execution of Supplemental Indenture and Security (e)Agreements. In executing or accepting the additional trusts created by any supplementalindenture and security agreement permitted by this Article VIII or the modifications thereby of
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the trusts created by this Indenture and Security Agreement, the Trustee and the Collateral Agentshall be entitled to receive, and (subject to Section 6.1 and 6.26.1(g)) shall be fully protected inrelying upon, an Opinion of Counsel or an Officer’s certificate of the Investment Managerstating that the execution of such supplemental indenture and security agreement is authorized orpermitted by this Indenture and Security Agreement and that all conditions precedent theretohave been satisfied. The Trustee and the Collateral Agent may, but shall not be obligated to,enter into any such supplemental indenture and security agreement which affects the Trustee’s and the and the Collateral Agent’s own rights, duties or immunities under this Indenture and Security Agreement or otherwise. Neither the Investment Manager nor the CollateralAdministrator shall be bound to follow any amendment or supplement to this Indenture and Security Agreement unless it has received written notice of such amendment or supplement anda copy of the amendment or supplement from the Issuer, the Collateral Agent or the Trustee priorto the execution thereof in accordance with the notice requirements of Section 8.1 and Section 8.2. Notwithstanding anything in this Indenture and Security Agreement to the contrary, theIssuer agrees that it shall not permit to become effective any amendment or supplement to thisIndenture and Security Agreement which would (i) increase the duties or liabilities of, reduce oreliminate any right or privilege of (including as a result of an effect on the amount or the priorityof any fees or other amounts payable to the Investment Manager), or adversely change theeconomic consequences to, the Investment Manager, (ii) modify the restrictions on theacquisitions or sales of Collateral Obligations under Article XII or the Investment Criteria, thePortfolio Quality Tests, the Coverage Tests or the Concentration Limitations or (iii) expand orrestrict the Investment Manager’s discretion, unless the Investment Manager shall haveconsented in advance thereto in writing.
(b) Notwithstanding anything herein to the contrary, no supplemental indenture and security agreement, or other modification or amendment of this Indenture and Security Agreement, may become effective without the consent of each Holder of each Outstanding Note of each Class and the Class A Lenders (so long as the Class A Loans are Outstanding) materially and adversely affected thereby unless such supplemental indenture and security agreement or other modification or amendment would not, based upon written advice or an opinion of legal counsel experienced in such matters, (i) result in the Issuer or the Income Note Issuer becoming subject to U.S. federal income taxation with respect to its net income, (ii) result in the Issuer being treated as being engaged in a trade or business within the United States, or (iii) have a material adverse effect on the tax treatment of the Issuer or the Income Note Issuer or the tax consequences to the holders of any Class of Debt outstanding at the time of such supplemental indenture and security agreement or other modification or amendment, as described in the Offering Circular under the heading “Certain U.S. Federal Income Tax Considerations.”
In no case will a supplemental indenture that becomes effective on or after (f)the Redemption Date of any Class of Notes be considered to have a material adverse effect on any Holder of such Class (provided that the redemption of such Class is effected on such Redemption Date), and no Holder of such Class shall have an objection right or consent right to such supplemental indenture on the basis of a material and adverse effect. Any Non-Consenting Holders of a Re-Priced Class will be deemed not to be materially and adversely affected by any terms of the supplemental indenture related to, in connection with or to become effective on or immediately after the Re-Pricing Date with respect to such Class. In addition, in the case of a
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Partial Redemption by Refinancing, holders of Classes not subject to such Partial Redemption by Refinancing will be deemed not to be materially and adversely affected by any terms of the supplemental indenture executed in accordance with Section 9.3 that does not change any terms of any such Class and solely impacts the terms of the class or classes of Replacement Notes being issued in accordance with Section 9.3.
For the avoidance of doubt, Reset Amendments are not subject to any consent requirements that would otherwise apply to supplemental indentures described in the immediately preceding paragraph or elsewhere herein.
For the avoidance of doubt, if (i) satisfaction of the Moody’s Rating (g)Condition is not required in connection with any supplemental indenture or (ii) any supplemental indenture is executed pursuant to Section 8.1 (regardless of any requirement in Section 8.2), then the failure to satisfy the Moody’s Rating Condition shall not prevent the execution or effectiveness of such supplemental indenture.
With respect to any supplemental indenture proposed pursuant to this (h)Indenture that requires the consent of any Class of Notes, the consent of the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder holds a Majority of the Subordinated Notes) to such supplemental indenture will be required in addition to the consent of such Class or Classes of Notes prior to the execution of such supplemental indenture. This clause will not reduce the requirement for the consent of each holder of the Subordinated Notes for any proposed supplemental indenture.
Effect of Supplemental Indenture and Security Section 8.4AgreementsIndentures. Upon the execution of any supplemental indenture and security agreement under this Article VIII, this Indenture and Security Agreement shall be modified inaccordance therewith, and such supplemental indenture and security agreementIndenture shallform a part of this Indenture and Security Agreement for all purposes; and every Holder ofDebtNotes theretofore and thereafter authenticated and delivered hereunder shall be boundthereby.
Reference in Notes to Supplemental Indenture and Security Section 8.5AgreementsIndentures. Notes authenticated and delivered after the execution of anysupplemental indenture and security agreement pursuant to this Article VIII may, and if requiredby the Issuer shall, bear a notice in form approved by the Trustee and the Collateral Agent as toany matter provided for in such supplemental indenture and security agreement. If theApplicable Issuers shall so determine, new Notes, so modified as to conform in the opinion of the Trustee, the Collateral Agent and the Co-Issuers to any such supplemental indenture and security agreement, may be prepared and executed by the Applicable Issuers and authenticatedand delivered by the Trustee in exchange for Outstanding Notes.
Re-Pricing Amendment. For the avoidance of doubt, theSection 8.6Co-Issuers, the Collateral Agent and the Trustee may, without regard for the provisions of thisArticle VIII (other than Section 8.3(e)), enter into a supplemental indenture and security agreement pursuant to Section 9.9(c) solely to modify the spread over LIBOR with respect to theRe-Priced Class.
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ARTICLE IX
REDEMPTION OF NOTES
Mandatory Redemption. If a Coverage Test is not met on anySection 9.1Determination Date on which such Coverage Test is applicable, the Issuer shall apply availableamounts in the Payment Account on the related Payment Date to make payments in accordance with the Sequential Debt Redemption as required pursuant to the Priority of Payments to achievecompliance with such Coverage Test.
Optional Redemption. (a) The Rated Debt shallNotes may beSection 9.2optionally redeemed (or in the case of the Class A Loans prepaid pursuant to the Credit Agreement) by the Co-Issuers or the Issuer, as the case may be, in whole but not in part,by the Applicable Issuers at the applicable Redemption Prices on any Business Day after the latest Non-Call Period pursuant to a(which shall be the related Redemption by Refinancing or at any timeDate) after the latestend of the Non-Call Period, pursuant to a Redemption by Liquidation or a Redemption by Refinancing (each, an “Optional Redemption”), at the written direction of aMajority of the Subordinated Notes or, in the case of a Redemption by Refinancing, the Investment Manager (so long as, if the Redemption/Re-Pricing Objection Condition is satisfied as of the date of such direction, the Initial Majority Subordinated Noteholder does not object within 5 Business Days of receiving notice of such Redemption by Refinancing) the Investment Manager, as described below, delivered to the Issuer, the Trustee, the Collateral Agent, the Loan Agent, and the Investment Manager (if applicable) and the Initial Majority Subordinated Noteholder (so long as the Redemption/Re-Pricing Objection Condition is satisfied) not later than 20 days (or such shorter time as the Issuer, the Trustee, the Collateral Agent, the Loan Agent, the Investment Manager (if applicable) and the Initial Majority Subordinated Noteholder (so long as the Redemption/Re-Pricing Objection Condition is satisfied) find reasonably acceptable)as applicable) not later than ten (10) Business Days prior to the proposed RedemptionDate. A Majority of the Subordinated Notes may direct that an Optional Redemption occur bydirecting the Investment Manager to liquidate a sufficient amount of the Assets (a “Redemption by Liquidation”) to fully redeem or prepay, as applicable, all Classes of Rated Debt. In addition, eitherNotes. The Investment Manager, on behalf of the Issuer, (i) shall, at the direction of aMajority of the Subordinated Notes may direct the Investment Manager to or the Investment Manager, or (ii) may, with the consent of the Initial Majority Subordinated Noteholder so longas, if the Redemption/Re-Pricing Objection the Initial Majority Subordinated NoteholderCondition is satisfied as of the date of such election, the Initial Majority Subordinated Noteholder does not object within 5 Business Days of receiving notice of such Redemption by Refinancing) may elect to, negotiate and obtain on behalf of the Issuer (x) one or more loans orother financing arrangements to be made to the Issuer, and/or (y) the issuance of replacementnotes or loans (“Replacement DebtNotes”) by the Issuer (each, a “Refinancing”), the proceeds ofwhich shall be used to fully redeem or prepay, as applicable, all Classes of Rated DebtNotesdesignated by a Majority of the Subordinated Notes or the Investment Manager, as applicable ((each clause (x) and (y), a “Redemption by Refinancing”), the terms of which shall be approved by a Majority of the Subordinated Notes and, with respect to a Refinancing directed by a Majority of the Subordinated Notes, the Investment Manager. The Issuer shall deposit, or cause
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to be deposited, the funds required for an Optional Redemption on or prior to the RedemptionDate. No Redemption by Liquidation or Redemption by Refinancing of all Classes of Rated Debt shall occur unless (x) the Class A Loans are prepaid pursuant to the Credit Agreement simultaneously with the redemption of the Rated Notes and (y) in the case of a Redemption be Refinancing, the Class A-1 Notes and the Class A Loans are refinanced on identical terms. Notwithstanding anything herein to the contrary, a majority of the Subordinated Notes shall not direct a Refinancing or Redemption by Refinancing, in whole but not in part, pursuant to this section 9.2(a) unless the Manager Approval Condition has been satisfied.
Upon receipt of a notice of a Redemption by Liquidation, the Investment(b)Manager shall direct the sale (and, in its sole discretion, the manner thereof) of all or part of theCollateral Obligations and other Assets in accordance with the procedures set forth in Section 9.2(b). The Disposition Proceedsproceeds of a Redemption by Liquidation and all other fundsavailable for such redemption in the Collection Account and the Payment Account shall be atleast sufficient to pay the applicable Redemption Price on all of the Rated DebtNotes and to payall Administrative Expenses (regardless of the Administrative Expense Cap) and other fees andexpenses payable under the Priority of Payments (including, without limitation, any amounts dueto the Hedge Counterparties); provided that any Holder of Rated DebtNotes may in its solediscretion elect, by written notice to the Issuer, the Trustee, the Collateral Agent, the Loan Agent, the Paying Agent, the Income Note Paying Agent and the Investment Manager, to receivein full payment for the redemption or prepayment, as applicable, of its Rated DebtNotes anamount less than the Redemption Price of such Rated DebtNotes in connection with aRedemption by Liquidation of all Classes of Rated DebtNotes. If such Disposition Proceedsproceeds of a Redemption by Liquidation and all other funds available for such purposein the Collection Account and the Payment Account would not be sufficient to redeem or prepay, as applicable, all of the Rated DebtNotes at the applicable Redemption Price and to pay suchfees and expenses, the Rated DebtNotes may not be redeemed and/or prepaid. The InvestmentManager, in its sole discretion, may effect the sale of all or any part of the Collateral Obligationsor other Assets through the direct sale of such Collateral Obligations or other Assets or byparticipation or other arrangement.
Notwithstanding anything to the contrary set forth herein, the Rated(c)DebtNotes shall not be redeemed (and the Class A Loans shall not be prepaid) pursuant to aRedemption by Liquidation unless (i) at least fivethree (53) Business Daysdays before thescheduled Redemption Date the Investment Manager shall have furnished to the Collateral Agent evidence, in a form reasonably satisfactory to the Collateral Agent,certified to the Trustee thatthe Investment Manager on behalf of the Issuer has entered into a binding agreement oragreements with a financial or other institution or institutions to purchase (which purchase maybe through a participation), not later than the Business Day immediately preceding the scheduledRedemption Date in immediately available funds, all or part of the Collateral Obligations and/orany Hedge Agreements at a purchase price at least equal to an amount sufficient, together withthe Eligible Investments maturing, redeemable (or putable to the issuer thereof at par) on or priorto the scheduled Redemption Date, any payments to be received in respect of any HedgeAgreements, to pay all Administrative Expenses and other fees and expenses payable inaccordance with the Priority of Payments (regardless of the Administrative Expense Cap) priorto the payment of the principal of the DebtNotes to be redeemed and/or prepaid and to redeem or prepay, as applicable, all of the Rated DebtNotes on the scheduled Redemption Date at the
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applicable Redemption Price, or (ii) prior to selling any Collateral Obligations and/or EligibleInvestments, the Investment Manager shall certify to the Collateral AgentTrustee that, in itsjudgment (which may be based on the Issuer having entered into an agreement to sell suchAssets to another special purpose entity that has priced but has not yet closed its securitiesoffering), the aggregate sum of (A) any expected proceeds from Hedge Agreements and the saleof Eligible Investments and (B) for each Collateral Obligation, the product of its PrincipalBalance and its Market Value (expressexpressed as a percentage of its Principal Balance), shallexceed the sum of (x) the aggregate Redemption Prices of the Outstanding Rated DebtNotes and(y) all Administrative Expenses and other fees and expenses payable under the Priority ofPayments (including, without limitation, the Management Fees, Management Fee Interest andany amounts due to Hedge Counterparties) (without limitation thereof by the AdministrativeExpense Cap) prior to the redemption or prepayment, as applicable, of the DebtNotes. Anycertification delivered by the Investment Manager pursuant to this Section 9.2(c) shall include(1) the prices of, and expected proceeds from, the sale (directly or by participation or otherarrangement) of any Collateral Obligations, Eligible Investments and/or Hedge Agreements and(2) all calculations required by this Section 9.2(c).
Upon receipt of notice of a Redemption by Refinancing of all Classes of (d)Rated Notes, the Investment Manager may obtain a Refinancing on behalf of the Issuer only if (i)the Refinancing Proceeds, Interest Proceeds and all other available funds in the Accounts shallbe at least sufficient to redeem and/or prepay simultaneously each Class of Rated DebtNotes, inwhole but not in part, and to pay the other amounts included in the aggregate Redemption Priceand all accrued and unpaid Administrative Expenses (regardless of the Administrative ExpenseCap), including the reasonable fees, costs, charges and expenses incurred by the Trustee, the Collateral Agent, the Loan Agent and the Collateral Administrator (including reasonableattorneys’ fees and expenses) in connection with such Refinancing; provided that any Holder ofa Rated DebtNotes may in its sole discretion elect, by written notice to the Issuer, the Trustee,the Collateral Agent, the Loan Agent, the Paying Agent, the Income Note Paying Agent and theInvestment Manager, to receive in full payment for the redemption or prepayment, as applicable, of its Rated DebtNotes in an amount less than the Redemption Price of such Rated DebtNotes inconnection with a Refinancing of all Classes of Rated DebtNotes, (ii) the Refinancing Proceedsand other available funds are used to the extent necessary to make such redemption and/or prepayment, (iii) the agreements relating to such Refinancing contain limited recourse andnon-petition provisions equivalent (mutatis mutandis) to those contained in Section 2.8(i) and Section 5.4(d), and (iv) written advice of White & Case LLP or Winston & Strawn LLP, or a written opinion of other tax counsel5.4(d); provided that the consent of the Investment Manager will be required if the Investment Manager determines in its commercially reasonable judgment based upon the advice of nationally recognized standing in the United Statescounsel experiencedin such matters, shall be delivered to the Trustee, the Collateral Agent and the Loan Agent to the effect that the Refinancing will not cause the Issuer to be treated as a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes (an oral or written summary of such legal advice to be provided to the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder holds a Majority of the Subordinated Notes)) that such proposed Redemption by Refinancing would require the Investment Manager to acquire obligations of the Issuer issued in such Redemption by Refinancing in excess of the Retention Interest (or such lower amount as may be permitted by the U.S. Risk Retention Rules prior to
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such Redemption by Refinancing) in order to be in compliance with the U.S. Risk Retention Rules.
The Subordinated Notes may be redeemed, in whole but not in part, on(e)any Business Day on or after the redemption or prepaymentrepayment of all of the RatedDebtNotes in full, at the written direction of either (x) a Majority of the Subordinated Notes or(y) the Investment Manager.
The Holders of the Subordinated Notes shall not have any cause of action againstany of the Co-Issuers, the Investment Manager, the Collateral Agent, the Loan Agent or theTrustee for any failure to obtain a Refinancing. In the event that a Refinancing is obtainedmeeting the requirements specified above as certified by the Investment Manager, theCo-Issuers, the Collateral Agent and the Trustee (as directed by the Issuer) shall amend thisIndenture and Security Agreement pursuant to Article VIII to the extent necessary to reflect theterms of the Refinancing and no further consent for such amendments shall be required from theHolders of DebtNotes, other than the Majority of the Subordinated Notes directing theredemption.
In connection with a Refinancing of the Class A Notes, so long as the (f)Initial Majority Subordinated Noteholder Condition is satisfied, the Initial Majority Subordinated Noteholder and the Investment Manager, may agree to designate Principal Proceeds in an amount up to the Excess Par Amount as Interest Proceeds (such designated amount, the “Designated Excess Par”), and direct the Trustee to apply such Designated Excess Par on such Redemption Date as Interest Proceeds in accordance with the Priority of Payments; provided that, if such Refinancing is a Refinancing in part by Class, the Par Value Ratio Test with respect to the Class E Notes will be satisfied after giving effect to such application of the Designated Excess Par.
Partial Redemption by Refinancing. Upon written direction of (a) Section 9.3a Majority of the Subordinated Notes or (b) the Investment Manager (so long as, if the Redemption/Re-Pricing Objection Condition is satisfied as of the date of such direction, the Initial Majority Subordinated Noteholder does not object within 5 Business Days of receiving notice of such Partial Redemption by Refinancing) delivered to the Collateral Agent,with the consent of the Initial Majority Subordinated Noteholder, so long as the Initial Majority Subordinated Noteholder Condition is satisfied) delivered to the Issuer, the Trustee, the Investment Manager (if applicable) and the Initial Majority Subordinated Noteholder (so long as the Redemption/Re-Pricing Objection Condition is satisfied) not later than 20 days (or such shorter period of time as the Issuer, the Trustee, the Collateral Agent, the Loan Agent, the Investment Manager (if applicable) and the Initial Majority Subordinated Noteholder (so long as the Redemption/Re-Pricing Objection Condition is satisfied) find reasonably acceptable) and the Investment Manager, as applicable, not later than ten (10) Business Days prior to the proposedRedemption Date, the Issuer shall redeem and/or prepay one or more Classes of Rated Debt after the applicableNotes designated by a Majority of the Subordinated Notes following the end of theNon-Call Period, in whole but not in part with respect to each such Class to be redeemed or prepaid, as applicable, from Refinancing Proceeds, Partial Redemption Interest Proceeds and amounts in the Permitted Use Account designated for such purpose (any such redemption, a“Partial Redemption by Refinancing”). No Partial Redemption by Refinancing of the Class A-1
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Notes may occur unless the Class A Loans are refinanced pursuant to the Credit Agreement simultaneously with the refinancing of the Class A-1 Notes and on the identical terms as the refinancing of the Class A-1 Notes. The Class A-2 Notes may be subject to a Partial Redemption by Refinancing on any Business Day after the Payment Date in April 2016 without the refinancing of any other Class A Obligation. Notwithstanding anything herein to the contrary, with respect to the Class A-2 Notes only, (x) a Majority of the Subordinated Notes and the Investment Manager shall not direct a Partial Redemption by Refinancing of the Class A-2 Notes on or prior to the Payment Date in April 2017 without the consent of each Holder of the Class A-2 Notes and (y) a Majority of the Subordinated Notes shall not direct a Partial Redemption by Refinancing of the Class A-2 Notes pursuant to this Section 9.3 unless the Manager Approval Condition has been satisfied.
The Issuer shallInvestment Manager may obtain a Refinancing in connection with a Partial Redemption by Refinancing on behalf of the Issuer only if the Investment Managerdetermines and certifies to the Collateral AgentTrustee and the Issuer that: (i) notice of theproposed Redemption by Refinancing has been given to the Rating Agencies, (ii) theRefinancing Proceeds (together with, Partial Redemption Proceeds (or, if such Redemption Date is otherwise a Payment Date, Interest Proceeds available in accordance with the Priority ofPayments to pay the accrued interest portion of the applicable Redemption Price) and any amounts in the Permitted Use Account designated for such purpose shall be in an amount at leastequal to the amount requiredsufficient to pay the Redemption Price of the Class or Classes ofRated DebtNotes subject to such Partial Redemption by Refinancing, (iii) the aggregate principalamount of the Replacement DebtNotes issued by the Issuer under such Partial Redemption byRefinancing is equal to the Aggregate Outstanding Amount of the Rated Debt to beNotes beingredeemed or prepaid, as applicable, with the proceeds of such Partial Redemption byRefinancing, except that (x) in connection with a Refinancing of the Controlling Class, the principal amount of the Replacement Notes providing the Refinancing of such Class of Notes may be lower than the Aggregate Outstanding Amount of such Class of Notes being redeemed and (y) the principal amount of the Replacement Notes may be greater than the Aggregate Outstanding Amount of the Class of Notes being redeemed so long as (A) the Moody’s Rating Condition has been satisfied with respect thereto, (B) with the consent of the Investment Manager but only if the Investment Manager determines in its commercially reasonable judgment based upon the advice of nationally recognized counsel experienced in such matters (an oral or written summary of such legal advice to be provided to the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder holds a Majority of the Subordinated Notes)) that such proposed Redemption by Refinancing would require the Investment Manager to acquire obligations of the Issuer issued in such Redemption by Refinancing in excess of the Retention Interest (or such lower amount as may be permitted by the U.S. Risk Retention Rules prior to such Redemption by Refinancing) in order to be in compliance with the U.S. Risk Retention Rules and (C) after giving effect to such proposed Refinancing, the Par Value Ratio Test with respect to each Class (or Classes) of Notes is either (1) satisfied, or (2) if such Par Value Ratio Test was not satisfied prior to such proposed Refinancing, it is maintained or improved (disregarding from the principal amount of the refinancing obligations, for purposes of the comparison in this clause (C), an amount, as determined by the Investment Manager up to U.S.$1,000,000 representing the reasonable fees, costs, charges and expenses expected to be incurred in connection with such Refinancing); (iv)the stated maturity of the obligations providingof the Issuer under such Refinancing is no earlier
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than the Stated Maturity of the Class or Classes of Rated DebtNotes subject to such PartialRedemption by Refinancing, (v) the Refinancing Proceeds shall be used (to the extent necessary)to redeem and/or prepay the Class or Classes of Rated DebtNotes subject to such partialPartialRedemption by Refinancing, (vi) the agreements relating to thesuch Partial Redemption byRefinancing contain limited- recourse and non-petition provisions equivalent (mutatis mutandis)to those contained in Section 2.8(i) and Section 5.4(d) or the Credit Agreement, (vii) theobligations providing of the Issuer under such Refinancing are not senior in priority of payment,and do not have greater voting, consent and redemption rights hereunder than the Holdersholdersof the corresponding Class or Classes of Rated DebtNotes subject to such Partial Redemption byRefinancing, (viii) the Replacement Debt in the case of any Rated Debt, shall have the same or lower interest rate spread as the Class(es) of Rated Debt to be redeemed or prepaid, as applicable, (ix) the reasonable fees, costs, charges andinterest rate spread over LIBOR (and in the case of any fixed rate refinancing obligations, the respective fixed rate of interest) payable in respect of such Refinancing is less than or equal to the interest rate spread over LIBOR payable on the corresponding proposed Class of Notes to be redeemed; provided, that if more than one Class of Notes is subject to a Refinancing, the spread over LIBOR of the obligations providing the Refinancing for a Class of Notes may be greater than the spread over LIBOR for such Class of Notes subject to Refinancing so long as the weighted average (based on the Aggregate Outstanding Amount of each Class of Notes subject to Refinancing) of the spread over LIBOR of the obligations comprising the Refinancing shall be less than the weighted average (based on the Aggregate Outstanding Amount of each such Class) of the spread over LIBOR with to all Classes of Notes subject to such Refinancing and (ix) the expenses incurred at the time of and inconnection with thesuch Partial Redemption by Refinancing shall have been paid or will beadequately provided for from (x) the Refinancing Proceeds or (y) Interest Proceeds availableand amounts in the Permitted Use Account designated for such purpose (except for expenses owed to persons that agree to be paid solely as Administrative Expenses payable in accordance with thePriority of Payments) for the payment of such amounts as Administrative Expenses, (x) written advice of White & Case LLP or Winston & Strawn LLP, or a written opinion of other tax counsel of nationally recognized standing in the United States experienced in such matters, shall be delivered to the Trustee, the Collateral Agent and the Loan Agent to the effect that the Refinancing will not cause the Issuer to be treated as a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes and (xi) the terms of such Refinancing have been approved (A) in the case of a Refinancing directed by the Investment Manager, a Majority of the Subordinated Notes and (B) in the case of a Refinancing directed by a Majority of the Subordinated Notes, the Investment Manager. The Issuer shall comply with the provisions of Section 9.2(e) in connection with any Partial Redemption by Refinancing.
Redemption Following a Tax Event. The DebtNotes shall beSection 9.4redeemed or prepaid, as applicable, by the Co-Issuers or the Issuer, as the case may be, in wholebut not in part, on any Payment DateBusiness Day on or after the occurrence of a Tax Event atthe written direction of a Majority of the Subordinated Notes delivered to the Issuer, the Trustee, the Collateral Agent, the Loan Agent and the Investment Manager not later than 20thirty (30)days (or such shorter period of time as the Issuer, the Trustee, the Collateral Agent, the Loan Agent and the Investment Manager find reasonably acceptable) prior to the proposedRedemption Date. A Majority of the Subordinated Notes may direct the Investment Manager toeffect a Redemption by Liquidation to fully redeem or prepay, as applicable, all Classes ofDebtNotes in accordance with the procedures set forth in Section 9.5. The funds available for
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such a redemption of the DebtNotes shall include all Principal Proceeds, Interest Proceeds,Disposition Proceeds and all other available funds in the Collection Account and the PaymentAccount. Each Class of DebtNotes shall be redeemed or prepaid, as applicable, at the applicableRedemption Price for such Class in accordance with the Priority of Payments.
Redemption Procedures. (a) In the event of an OptionalSection 9.5Redemption or a Partial Redemption by Refinancing, the written direction of the Holders of theSubordinated Notes or, in the case of a Redemption by Refinancing or Partial Redemption by Refinancing, the Investment Manager required as set forth herein shall be provided to the Issuer,the Trustee, the Collateral Agent, the Loan Agent, and the Investment Manager (if applicable) and the Initial Majority Subordinated Noteholder (so long as the Redemption/Re-Pricing Objection Condition is satisfied) not later than 20 days (or such shorter period of time as the Issuer, the Trustee, the Collateral Agent, the Loan Agent, the Investment Manager (if applicable) and the Initial Majority Subordinated Noteholder (if applicable) find reasonably acceptable)not later than ten (10) Business Days prior to the applicable Redemption Date on which suchredemption is to be made (which date shall be designated in such notice) and a notice ofredemption shall be given by the Collateral AgentIssuer (or the Trustee on its behalf) by firstclass mail, postage prepaid, mailed not later than tenfive (5) Business Days prior to theapplicable Redemption Date, to each Holder of DebtNotes to be redeemed or prepaid, as applicable, at such Holder’s address in the Register or, in the case of the Class A Loans, as set forth in the Credit Agreement, and each Rating Agency then rating a Class of Rated Debt. In addition, for so long as any Notes are listed on the Irish Stock Exchange and so long as the guidelines of such exchange so require, notice of Optional Redemption to the Holders of such Notes shall also be sent to the Irish Stock Exchange for release through the Companies Announcements Office.Notes.
All notices of redemption delivered pursuant to Section 9.5(a) shall state:(b)
the applicable Redemption Date;(i)
the Redemption Price of the DebtNotes to be redeemed or prepaid, as (ii)applicable;
in the case of an Optional Redemption, that all of the Rated DebtNotes are(iii)to be redeemed or prepaid, as applicable, in full and that interest on such RatedDebtNotes shall cease to accrue on the date specified in the notice;
in the case of a Partial Redemption by Refinancing, the Classes of Rated(iv)DebtNotes to be redeemed or prepaid, as applicable, in full and that interest on suchRated DebtNotes shall cease to accrue on the date specified in the notice;
the place or places where Notes are to be surrendered for payment of the(v)Redemption Price, which shall be the office or agency of the Co-Issuers to be maintainedas provided in Section 7.2; and
in the case of an Optional Redemption, whether the Subordinated Notes(vi)are to be redeemed in full on such Redemption Date and, if so, the place or places where
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the Subordinated Notes are to be surrendered for payment of the Redemption Price,which shall be the office or agency of the Co-Issuers to be maintained as provided inSection 7.2 for purposes of surrender.
The Applicable Co-Issuers shall have the option to withdraw any such notice ofredemption up to and including the latest of (x) the day on which the Investment Manager isrequired to deliver to the Trustee, the Collateral Agent and the Loan Agent the sale agreement or agreements or the certifications as described in Section 9.2(b), byc), only if the Investment Manager has provided written notice to the Trustee, the Collateral AgentCo-Issuers and the Loan AgentTrustee that the Investment Manager will be unable to deliver the sale agreement or agreements orsuch certifications described in Section 9.2(b)c) or it is unable to obtain the applicable Refinancing on behalf of the Issuer, (y) the day on which the Holders of the DebtNotes are notified of such redemption in accordance with Section 9.5(a) and (z) one, if the Issuer receives written direction from a Majority of the Subordinated Notes to withdraw such notice of redemption and (z) one (1) Business Day prior to the applicable Redemption Date (i) ifthe Investment Manager determines, in its commercially reasonable business judgment, that theCo-Issuers will not have sufficient proceeds to redeem or prepay, as applicable, all of the RatedDebtNotes on the applicable Redemption Date; (provided that the Issuer will use reasonableefforts to notify the Collateral AgentTrustee as soon as possible upon learning of suchwithdrawal). Any withdrawal of such notice of redemption shall be made by written notice to the Trustee, the Collateral Agent, the Loan Agent, Fitch and the Investment Manager and shall be made by the Applicable Issuers only if the Investment Manager has notified the Co-Issuers that either (i) it is unable to deliver the sale agreement or agreements or certifications described in Section 9.2(c) and Section 12.1(b) and (f), in form satisfactory to the Trustee, or (ii) it is unable to obtain the applicable Refinancing on behalf of the Issuer or (ii) upon delivery of a Manager Change in Law Notice. The Issuer shall provide notice of any such withdrawal to Fitch. In addition, a Majority of the Subordinated Notes shall have the option to withdraw anysuch notice of redemption up to and including the Business Day prior to the proposedRedemption Date.
If the Co-Issuers so withdraw any notice of redemption or are otherwise unable tocomplete any redemption of the DebtNotes, the Sale Proceeds received from the sale of anyCollateral Obligations and other Assets sold pursuant to Section 9.2 may, during theReinvestment Period at the Investment Manager’s sole discretion, be reinvested in accordancewith the Investment Criteria. The failure to effect any Optional Redemption or any redemption following a Tax Event shall not constitute an Event of Default.
Notice of redemption shall be given by the Co-Issuers (so long as the Co-Issuershave received notice thereof) or, upon an Issuer Order, by the Collateral AgentTrustee in thename and at the expense of the Co-Issuers. Failure to give notice of redemption, or any defecttherein, to any Holder of any DebtNotes selected for redemption shall not impair or affect thevalidity of the redemption of any other DebtNotes.
In connection with a Refinancing of all Classes of Rated Notes, with the approval of a Majority of the Subordinated Notes and the Investment Manager, the agreements relating to the Refinancing may, without limitation, (a) effect an extension of the end of the Reinvestment Period, (b) effect an extension of the Non-Call Period, (c) modify the Weighted Average Life
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Test, (d) provide for a stated maturity of the Replacement Notes or loans or other financial arrangements issued or entered into in connection with such Refinancing that is later than the Stated Maturity of the Rated Notes, (e) effect an extension of the Stated Maturity of the Subordinated Notes and the Income Notes or (f) effect any supplements or amendments to this Indenture that would otherwise be subject to any provision of Section 8.1 or Section 8.2 other than Section 8.1(viii) (a “Reset Amendment”).
In connection with any Refinancing, with the approval of the Investment Manager, the agreements relating to the Refinancing may, without regard for any consent requirements specified in Article VIII, adjust the Asset Quality Matrix to account for changes in the interest rates of any of the Rated Notes (subject to satisfaction of the Moody’s Rating Condition).
Any Holder of DebtNotes, the Investment Manager or any of the InvestmentManager’s Affiliates or accounts managed by it shall have the right, subject to the same termsand conditions afforded to other bidders, to bid on Assets to be sold as part of an OptionalRedemption or a redemption pursuant to Section 9.4.
DebtNotes Payable on Redemption Date. (a) Notice of redemptionSection 9.6pursuant to Section 9.5 having been given as aforesaid, the DebtNotes to be redeemed or prepaid, as applicable, shall, on the Redemption Date, subject to Section 9.2(b) in the case of anOptional Redemption and the right to withdraw any notice of redemption pursuant to Section 9.5(a), become due and payable at the Redemption Price therein specified, and from and after theRedemption Date (unless the Issuer shall default in the payment of the Redemption Price andaccrued interest) all such Rated DebtNotes shall cease to bear interest on the Redemption Date.Upon final payment on a Note to be so redeemed the Holder shall present and surrender suchNote at the place specified in the notice of redemption on or prior to such Redemption Date;provided that if there is delivered to the Co-Issuers, the Collateral Agent and the Trustee suchsecurity or indemnity as may be required by any of them to save such party harmless and anundertaking thereafter to surrender such Note, then, in the absence of notice to the Co-Issuers, the Collateral Agent, the Loan Agent or the Trustee that the applicable Note has been acquiredby a Protected Purchaser, such final payment shall be made without presentation or surrender.Payments of interest on Rated DebtNotes so to be redeemed or prepaid, as applicable, whoseStated Maturity is on or prior to the Redemption Date shall be payable to the Holders of suchRated DebtNotes, or one or more predecessor DebtNotes, registered as such at the close ofbusiness on the relevant Record Date according to the terms and provisions of Section 2.8(d).
If any Rated DebtNotes called for redemption or prepayment shall not be(b)paid upon surrender thereof for redemption, the principal thereof shall, until paid, bear interestfrom the Redemption Date at the applicable DebtNote Interest Rate for each successive InterestAccrual Period the Rated DebtNotes remains Outstanding; provided that the reason for suchnon-payment is not the fault of such Holder of DebtNotes.
Notwithstanding anything to the contrary set forth herein, the proceeds(c)from a Refinancing shall not constitute Interest Proceeds or Principal Proceeds but shall beapplied directly on the related Redemption Date to redeem or prepay, as applicable, the Class(es)of Rated DebtNotes subject to such Redemption by Refinancing without regard to the Priority of
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Payments; provided that to the extent such Refinancing Proceeds are not applied to redeem or prepay, as applicable, such Class(es) of Rated DebtNotes or to pay expenses in connection withsuch Refinancing, such Refinancing Proceeds shall be treated as Interest Proceeds or, with the consent of a Majority of the Subordinated Notes, Principal Proceeds.
Special Redemption. Principal payments on the Rated DebtNotesSection 9.7shall be made in part in accordance with the Priority of Payments on any Payment Date (A)during the Reinvestment Period, if the Investment Manager at its sole discretion notifies theTrustee, the Loan Agent and the Collateral Agent that it has been unable, for a period of at leastthirty (30) consecutive Business Days, to identify additional Collateral Obligations that aredeemed appropriate by the Investment Manager in its sole discretion and would meet theInvestment Criteria in sufficient amounts to permit the investment or reinvestment of all or aportion of the funds then in the Collection Account that are to be invested in additionalCollateral Obligations or (B) after the Ramp-Up Period, if a Moody’s Ramp-Up Failure has occurred, the Investment Manager notifies the Trustee and the Collateral Agent that aredemption or prepayment, as applicable, is required pursuant to Section 7.17 in order to obtainfrom Moody’s a confirmation of its Initial Ratings of each Class of the Rated Debt (in each case, Notes (a “Special Redemption”). On the first Payment Date (and all subsequent Payment Dates)following the Collection Period in which such notice is given (a “Special Redemption Date”),the amount in the Principal Collection AccountSubaccount representing (1) Principal Proceedswhich the Investment Manager has determined cannot be reinvested in additional CollateralObligations or (2) Interest Proceeds and Principal Proceeds that must be applied to redeem or prepay, as applicable, a portion of the Rated DebtNotes in order to obtain from Moody’sconfirmation of its Initial Ratings of each Class of the Rated DebtNotes (such amount, a “Special Redemption Amount”), as the case may be, shall be applied in accordance with the Priority ofPayments under Section 11.1(a)(ii). Notice of payments pursuant to this Section 9.7 shall begiven by the Collateral Agent either by first class mail, postage prepaid, mailed as soon as reasonably practicable, but in any caseTrustee not less than three (3) Business Days prior to theapplicable Special Redemption Date (provided that such notice shall not be required inconnection with a Special Redemption pursuant to clause (B) of the definition of such term if theSpecial Redemption Amount is not known on or prior to such date) to each Holder of RatedDebtNotes affected thereby at such Holder’s address in the Register or, in the case of the Class A Loans, as set forth in the Credit Agreement, and to both Rating Agencies or by facsimile or viaemail transmission to such parties. In addition, for so long as any Notes are listed on the Irish Stock Exchange and so long as the guidelines of such exchange so require, notice of Special Redemption to the Holders of such Notes shall also be sent to the Irish Listing Agent for release through the Companies Announcements Office of the Irish Stock Exchange.
Clean-Up Call Redemption. (a) At the written direction of theSection 9.8Investment Manager in its sole discretion (which direction shall be given so as to be received bythe Issuer, the Trustee, the Collateral Agent, the Loan Agent and the Rating Agencies not laterthan thirty (30) days prior to the proposed Redemption Date specified in such direction), theRated DebtNotes will be subject to redemption or prepayment, as applicable, by the Co-Issuers,in whole but not in part (a “Clean Up Call Redemption”), at the Redemption Price therefor, onany Business Day after the latest Non-Call Period on which the Collateral Principal Amount isless than 15% of the Aggregate Ramp-Up Par Amount; provided that a Majority of the
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Subordinated Notes has not objected to such Clean-Up Call Redemption within ten (10) Business Days of receiving notice thereof.
Upon receipt of notice directing the Issuer to effect a Clean-Up Call(b)Redemption, the Investment Manager on behalf of the Issuer shall solicit bids for the purchase ofthe Collateral Obligations and other Assets of the Issuer at a price not less than the Clean-UpCall Purchase Price, and the bidders in connection with such purchase may include theInvestment Manager, the holders of the Subordinated Notes and their respective Affiliates. AnyClean-Up Call Redemption is subject to (i) the sale of the Collateral Obligations by the Issuer tothe highest bidder therefor pursuant to the immediately preceding sentence on or prior to thethird Business Day immediately preceding the related Redemption Date, for a purchase price inCash (the “Clean-Up Call Purchase Price”) payable prior to or on the Redemption Date at leastequal to the greater of (1) the sum of (a) the sum of the Redemption Prices of the RatedDebtNotes, plus (b) the aggregate of all other amounts owing by the Issuer on the date of suchredemption that are payable in accordance with the Priority of Payments prior to distributions inrespect of the Subordinated Notes, minus (c) all other cash and, Eligible Investments and other Assets available for application as Principal Proceeds in accordance with the Priority ofPayments on the Redemption Date and (2) the Market Value of such Assets being purchased,and (ii) the receipt by the Collateral AgentTrustee from the Investment Manager, prior to suchpurchase, of certification from the Investment Manager that the sum so received satisfies clause(i). Upon receipt by the Collateral AgentTrustee of the certification referred to in the precedingsentence, the Collateral AgentTrustee (pursuant to written direction from the Issuer) and theIssuer shall take all actions necessary to sell, assign and transfer the Assets to the applicablepurchaser upon payment in immediately available funds of the Clean-Up Call Purchase Price.The Collateral AgentTrustee shall deposit such payment into the applicable sub-account of theCollection Account in accordance with the instructions of the Investment Manager.
Upon receipt from the Investment Manager of a direction in writing to(c)effect a Clean-Up Call Redemption, the Issuer shall set the related Redemption Date (asspecified in the direction delivered pursuant to clause (a) above) and the Record Date for anyredemption pursuant to this Section and give written notice thereof to the Trustee (which shallforward such notice to the Holders of the Notes), the Collateral Agent, the Loan Agent (which shall forward such notice to the Class A Lenders), the Collateral Administrator, the InvestmentManager and the Rating Agencies not later than fifteen (15) Business Days prior to the proposedRedemption Date.
Any notice of Clean-Up Call Redemption may be withdrawn by the Issuer(d)up to two (2) Business Days prior to the related scheduled Redemption Date by written notice tothe Trustee, the Rating Agencies and the Investment Manager only if amounts equal to theClean-Up Call Purchase Price are not received in full in immediately available funds by the thirdBusiness Day immediately preceding such Redemption Date. Notice of any such withdrawal ofa notice of Clean-Up Call Redemption shall be given by the Trustee at the expense of the Issuerto each Holder of DebtNotes to be redeemed or prepaid, as applicable, at such Holder’s addressin the Note Register or, in the case of the Class A Loans, as set forth in the Credit Agreement, byovernight courier guaranteeing next day delivery not later than the second Business Day prior tothe related scheduled Redemption Date. The Trustee shall also arrange for notice of such
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withdrawal to be delivered to the Irish Listing Agent to deliver to the Irish Stock Exchange so long as any Notes are listed thereon and so long as the guidelines of such exchange so require.
On the Redemption Date related to any Clean-Up Call Redemption, the(e)Clean-Up Call Purchase Price shall be distributed pursuant to the Priority of Payments.
Re-Pricing of Rated DebtNotes. (a) On any Business DaySection 9.9occurring after the applicable Non-Call Period, at the direction of (i) a Majority of the Subordinated Notes or (ii) the Investment Manager (with the consent of the Initial Majority Subordinated Noteholder, so long as, if the Redemption/Re-Pricing Objection Condition is satisfied as of the date of such direction, the Initial Majority Subordinated Noteholder does not object within 5 Business Days of receiving notice of such Re-Pricing) or a Majority of the Subordinated Notes (with a copy to the Investment ManagerCondition is satisfied), the Issuershall reduce the spread over LIBOR with respect to any Class of Class A-2 Notes, Class B-2 Notes, Class C-2 Notes, Class D Notes, Class E Notes or Class F Notes (all such Classes, the “Re-Pricing Eligible Debt”, Notes (such reduction with respect to any such Class of Re-Pricing Eligible DebtRated Notes, a “Re-Pricing” and any such Class of Re-Pricing Eligible DebtRated Notes to be subject to a Re-Pricing, a “Re-Priced Class”); provided that the Issuer shall not effectany Re-Pricing unless each condition specified in this Section 9.9 is satisfied with respectthereto. For the avoidance of doubt, no terms of any Re-Pricing Eligible DebtRated Notes otherthan the Debt Interest Rate applicable thereto may be modified or supplemented in connectionwith a Re-Pricing. In connection with any Re-Pricing, the Issuer may engage a broker-dealer(the “Re-Pricing Intermediary”) to assist the Issuer in effecting the Re-Pricing. The Class A-1 Notes, Class A Loans, Class B-1 Notes and Class C-1 Notes shall not be Re-Pricing Eligible Debt. Notwithstanding anything herein to the contrary, with respect to the Class A-2 Notes only, (x) unless such Re-Pricing is of all Classes of Rated Debt, a Majority of the Subordinated Notes and the Investment Manager shall not direct a Re-Pricing of the Class A-2 Notes on or prior to the Payment Date in April 2017 without the consent of each Holder of the Class A-2 Notes and (y) a Majority of the Subordinated Notes shall not direct a Re-Pricing of the Class A-2 Notes pursuant to this Section 9.9 unless the Manager Approval Condition has beenupon the recommendation and subject to the approval of the Investment Manager and the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder Condition issatisfied) to assist the Issuer in effecting the Re-Pricing.
At least 20 Business Daysfourteen (14) days prior to the Business Day(b)fixed by a Majority of the Subordinated Notes orthe party directing such Re-Pricing (with the consent of the Initial Majority Subordinated Noteholder, so long as the Initial Majority Subordinated Noteholder Condition is satisfied, if the Investment Manager, as applicable, is the party making such direction) for any proposed Re-Pricing (the “Re-Pricing Date”), the Issuer, orthe Re-Pricing Intermediary on behalf of the Issuer, shall deliver a notice (a “Re-Pricing Notice”) in writing (with a copy to the Investment Manager, the Trustee, the Collateral Agent, the Loan Agent, the Initial Majority Subordinated Noteholder (so long as the Redemption/Re-Pricing Objection Condition is satisfied)Holders of the Subordinated Notes andeach Rating Agency) to each Holder of the proposed Re-Priced Class, which noticeRe-Pricing Notice shall (i) specify the proposed Re-Pricing Date and the revised spread (or range of spreads from which a single spread will be chosen prior to the Re-Pricing Date) over LIBOR (or revised interest rate) to be applied with respect to such Class (such spread, the “Re-Pricing Rate”), (ii)
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request each Holder of the Re-Priced Class approve the proposed Re-Pricing, and (iii) specify the price at which Notes of any or provide a proposed Re-Pricing Rate at which it would consent to such Re-Pricing that is within the range provided, if any, in clause (i) above (such proposal, a “Holder Proposed Re-Pricing Rate”); (iii) request that each consenting Holder of the Re-PricedClass that does not approve the Re-Pricing may be sold and transferred pursuant to clause (c) below, which, for purposes of such Re-Pricing, shall be an amount equal to the Aggregate Outstanding Amount of the Re-Priced Class, plus accrued and unpaid interest thereon at the applicable Debt Interest Rate to but excluding the applicable Re-Pricing Datedeliver a response in writing to the Issuer, or to the Re-Pricing Intermediary on behalf of the Issuer, which response (the “Holder Purchase Request”) shall indicate the aggregate principal amount of the Re-Priced Class that such Holder is willing to purchase (or retain) at such Re-Pricing Rate (including within any range provided) specified in such Re-Pricing Notice; and (iv) state that the Issuer (or in the case of the following clause (A), the Re-Pricing Intermediary on behalf of the Issuer) shall have the right to (A) cause all such holders that did not deliver an Accepted Purchase Request (as defined below) (each, a “Non-Consenting Holder”) to sell their Notes of the Re-Priced Class on the Re-Pricing Date to one or more transferees at a sale price equal to the applicable Redemption Price, (B) redeem such Notes at the applicable Redemption Price with the proceeds of an issuance of Re-Pricing Replacement Notes or (C) amend, without consent, the interest rate applicable to the Notes of the Re-Priced Class held by Non-Consenting Holders to the Re-Pricing Rate in the event that the Issuer is unable to issue or deliver Re-Pricing Replacement Notes for any reason; provided that the Issuer at the direction of the Investment Manager (with the written consent of a Majority of the Subordinated Notes) may extend the Re-Pricing Date or determine the Re-Pricing Rate taking into consideration any Holder Proposed Re-Pricing Rates at any time up to two (2) Business Days prior to the Re-Pricing Date (upon notice to each Holder of the proposed Re-Priced Class, with a copy to the Investment Manager, the Trustee and each Rating Agency). Failure to give a notice of Re-Pricing, or any defect therein, to any Holder of any Re-Priced Class shall not impair or affect the validity of the Re-Pricing or give rise to any claim based upon such failure or defect.
(c) In the event that any Holder of the Re-Priced Class does not deliver a writtenconsent to the proposed Re-Pricing on or before the date whichthat is 15at least five (5) BusinessDays prior to the proposed Re-Pricing Date(such date as determined by the Issuer in its sole discretion) after the date of such notice, the Issuer, or the Re-Pricing Intermediary on behalf ofthe Issuer, shall deliver written notice thereof to the consenting Holders of the Re-Priced Class,any Consenting Holder of the Re-Priced Class who delivered a Holder Purchase Request with a Holder Proposed Re-Pricing Rate that is equal to or less than the Re-Pricing Rate as determined by the Investment Manager (such request, an “Accepted Purchase Request” and any Holder providing such Accepted Purchase Request, a “Consenting Holder”) specifying theAggregate Outstanding Amount of the Notes of the Re-Priced Class held by such non-consenting Holders, and shall request each such consenting Holder to provide written notice to the Issuer, the Trustee, the Collateral Agent, the Investment Manager and the Re-Pricing Intermediary if such Holder would like to purchase all or any portion of the Notes of the Re-Priced Class held by the non-consenting Holders (each such notice, an “Exercise Notice”) within five Business Days of receipt of such notice. In the event that the Issuer receives Exercise Notices with respect to more than the Aggregate Outstanding Amount of the Notes of the Re-Priced Class held by non-consenting Holders, the Issuer, or the Re-Pricing Intermediary on behalf of the Issuer, shall cause the sale and transfer of such Notes, without further notice to the non-consenting Holders
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thereof, on the Re-Pricing Date to the Holders delivering Exercise Notices with respect thereto, pro rata based on the Aggregate Outstanding Amount of the Notes such Holders indicated an interest in purchasing pursuant to their Exercise Notices. In the event that the Issuer receives Exercise Notices with respect to less than the Aggregate Outstanding Amount of the Notes of the Re-Priced Class held by non-consenting Holders, the Issuer, or the Re-Pricing Intermediary on behalf of the Issuer, shall cause the sale and transfer of such Notes, without further notice to the non-consenting Holders thereof, on the Re-Pricing Date to the Holders delivering Exercise Notices with respect thereto, if any, and any excess Notes of the Re-Priced Class held by non-consenting Holders shall be soldthat such Consenting Holder has offered to purchase at the Re-Pricing Rate and the aggregate outstanding amount of the Notes that will be sold to such Consenting Holder.
Notwithstanding the above, the Issuer, or the Re-Pricing Intermediary on (c)behalf of the Issuer, shall cause the sale and transfer of Notes of any Non-Consenting Holders, without further notice to such Non-Consenting Holders, on the Re-Pricing Date to a transfereedesignated by the Re-Pricing Intermediary on behalf of the Issuer. All sales of Notes to beeffected pursuant to this clause (c) shall be made at the Redemption Price with respect to suchNotes, and shall be effected only if the related Re-Pricing is effected in accordance with theprovisions hereof. The Holder of each Re-Pricing Eligible Note, by its acceptance of an interestin the Re-Pricing Eligible Notes, agrees to sell and transfer its Notes in accordance with thisSection 9.9 and agrees to cooperate with the Issuer, the Collateral Agent, the Re-PricingIntermediary and the Trustee to effect such sales and transfers.
Notwithstanding the foregoing, in the event any non-consenting Holder does not cooperate in accordance with the preceding paragraph to effect the sale and transfer of its Notes, the Issuer, or the Re-Pricing Intermediary on behalf of the Issuer, may (i) effect the Re-Pricing with respect to the Notes of the consenting Holders and issue Notes of the Re-Priced Class with new securities identifiers (such Notes, the “Re-Priced Notes”) to such consenting Holders and any third-party purchasers of the Notes of the Re-Priced Class held by non-consenting Holders, then (ii) pursuant to Section 9.2(a), redeem the Notes held by non-consenting Holders with the Refinancing Proceeds described in subclause (B) of the following sentence. For purposes of the redemption described in clause (ii) of the preceding sentence, (A) the issuance of Re-Priced Notes to the purchasers of the Notes of the Re-Priced Class held by non-consenting Holders will be deemed to constitute a Refinancing with respect to the Re-Priced Class, and (B) the purchase price paid for the Re-Priced Notes by the purchasers of the Notes of the non-consenting Holders pursuant to clause (A) above (which shall be an amount equal to the Redemption Price with respect to such Notes) will be deemed to constitute Refinancing Proceeds. For the avoidance of doubt, with respect to any such redemption pursuant to this paragraph, (i) notwithstanding anything to the contrary in this Article IX, such redemption shall apply only to the Notes of the Re-Priced Class with the original securities identifier and not to the Re-Priced Notes, and Section 9.2 shall be interpreted in accordance therewith, and (ii) such redemption may be accomplished without regard for any applicable notice and timing requirements specified in this Article IX.
In the event that the Issuer (or the Re-Pricing Intermediary on behalf of the Issuer) receives Accepted Purchase Requests with respect to more than the Aggregate Outstanding Amount of the Notes of the Re-Priced Class held by Non-Consenting Holders, the
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Issuer, or the Re-Pricing Intermediary on behalf of the Issuer, shall cause the sale and transfer of such Notes or will sell Re-Pricing Replacement Notes to such Consenting Holders at the applicable Redemption Prices and, if applicable, conduct a redemption of Non-Consenting Holders’ Notes of the Re-Priced Class with the sale of Re-Pricing Replacement Notes, without further notice to the Non-Consenting Holders thereof, on the Re-Pricing Date to the Consenting Holders delivering Accepted Purchase Requests with respect thereto, pro rata (subject to the applicable minimum denominations) based on the Aggregate Outstanding Amount of the Notes such Consenting Holders indicated an interest in purchasing pursuant to their Holder Purchase Requests. In the event that the Issuer receives Accepted Purchase Requests with respect to less than the aggregate outstanding amount of the Notes of the Re-Priced Class held by Non-Consenting Holders, the Issuer, or the Re-Pricing Intermediary on behalf of the Issuer, shall cause the sale and transfer of such Notes of the Re-Priced Class or will sell Re-Pricing Replacement Notes to such Consenting Holders at the applicable Redemption Prices and, if applicable, conduct a redemption of Non-Consenting Holders’ Notes of the Re-Priced Class with the sale of Re-Pricing Replacement Notes, without further notice to the Non-Consenting Holders thereof, on the Re-Pricing Date to the Consenting Holders delivering Accepted Purchase Requests with respect thereto, and any excess Notes of the Re-Priced Class held by Non-Consenting Holders shall be sold to one or more purchasers designated by the Issuer (or the Re-Pricing Intermediary on behalf of the Issuer) or redeemed with proceeds from the sale of Re-Pricing Replacement Notes. All sales of Non-Consenting Holders’ Notes or Re-Pricing Replacement Notes to be effected pursuant to this paragraph shall be made at the applicable Redemption Price, and shall be effected only if the related Re-Pricing is effected in accordance with this Section 9.9.
The Issuer, or the Re-Pricing Intermediary on behalf of the Issuer, shall deliver written notice to the Trustee and the Investment Manager not later than one (1) Business Day prior to the proposed Re-Pricing Date confirming that the Issuer has received written commitments to purchase all Notes of the Re-Priced Class held by Non-Consenting Holders
The Issuer shall not effect any proposed Re-Pricing unless:(d)
the Co-Issuers, the Collateral Agent and the Trustee (at the direction of the (i)Issuer), with the consent of a Majority of the Subordinated Notes and the InvestmentManager, shall have entered into a supplemental indenture and security agreement datedas of the Re-Pricing Date, solely to modify the spread over LIBOR with respect to theRe-Priced Class and to reflect any necessary changes to the definitions of “Non-Call Period” or “Redemption Price” to be made pursuant to the last paragraph of this section;
confirmation has been received that all Notes of the Re-Priced Class held(ii)by non-consentingNon-Consenting Holders have been sold and transferred or(and, if applicable, redeemed, with Re-Pricing Replacement Notes) pursuant to clause (c) above;
each Rating Agency shall have been notified of such Re-Pricing; and(iii)
all expenses of the Issuer, and the Trustee and the Collateral Agent (iv)(including the fees of the Re-Pricing Intermediary and fees of counsel) required to be currently paidincurred in connection with the Re-Pricing shall not exceed the amount of
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Interest Proceeds available after taking into account all amounts required to be paidpursuant to the Priority of Interest ProceedsSection 11.1(a)(i) on the subsequent PaymentDate prior to distributionsthe distribution of any remaining Interest Proceeds to theHolders of the Subordinated Notes, unless such expenses shall have been paid oradequately provided for by an entity other than the Issuer; and(v) written advice of White & Case LLP or Winston & Strawn LLP, or a written opinion of other tax counsel of nationally recognized standing in the United States experienced in such matters, shall be delivered to the Collateral Agent to the effect that the Re-Pricing will not cause the Issuer to be treated as a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes.
The Collateral Agent and the Trustee shall be entitled to receive, and(e)(subject to Section 6.1 and Section 6.2(a) hereof) shall be fully protected in relying upon anOpinion of Counsel or an Officer’s Certificate of the Investment Manager stating that theRe-Pricing is permitted by this Indenture and Security Agreement and that all conditionsprecedent thereto have been complied with. The Collateral AgentTrustee may request and relyon an Issuer Order providing direction and any additional information requested by theCollateral AgentTrustee in order to effect a Re-Pricing in accordance with this Section 9.99.7.
Notice of Re-Pricing shall be given by the Collateral Agent at the expense (f)of the Issuer not less than seven (7) Business Days prior to the proposed Re-Pricing Date to each Holder of Notes of the Re-Priced Class (with a copy to the Investment Manager) specifying the applicable Re-Pricing Date and Re-Pricing Rate. Failure to give a notice of Re-Pricing, or anydefect therein, to any Holder of any Re-Priced Class shall not impair or affect the validity of theRe-Pricing or give rise to any claim based upon such failure or defect.
The Holder of each Re-Pricing Eligible Note, by its acceptance of an (g)interest in the Re-Pricing Eligible Notes, agrees (i) to sell and transfer its Re-Pricing Eligible Notes in accordance with this Indenture and to cooperate with the Issuer, the Re-Pricing Intermediary (if any) and the Trustee to effect such sales and transfers and (ii) in the event that such Holder (x) does not consent to a proposed Re-Pricing or to a sale of its interest and (y) does not otherwise cooperate with the Issuer, the Re-Pricing Intermediary (if any) and the Trustee, in each case to effect such sales and transfers within the time period described herein, then such Holder will be deemed to consent to such Re-Pricing.
Any notice of a Re-Pricing may be withdrawn by (x) a Majority of the(h)Subordinated Notes (if such Re-Pricing was directed by a Majority of the Subordinated Notes) or the Investment Manager (if such Re-Pricing was directed by the Investment Manager) on or priorto the fourth Business Day prior to the scheduled Re-Pricing Date by written notice to the Issuer,the Trustee, the Collateral Agent and the Investment Manager, if applicable, for any reason or (y) the Investment Manager on or prior to the Business Day prior to the scheduled Re-Pricing Date by written notice to the Issuer, the Trustee and the Investment Manager upon the delivery of a Manager Change in Law Notice. Upon receipt of such notice of withdrawal, the Collateral AgentTrustee shall send such notice to the Holders of the DebtNotes and each Rating Agency.
In connection with a Re-Pricing, (x) the Non-Call Period for the Re-Priced (i)Class may be extended at the direction of the Investment Manager (subject to the prior written
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consent of a Majority of the Subordinated Notes) prior to such Re-Pricing, (y) the definition of “Redemption Price” may be revised, with the written consent of a Majority of the Subordinated Notes, to reflect any agreed upon make-whole payments for the applicable Re-Priced Class and/or (z) the agreements relating to the Re-Pricing may, without regard for any consent requirements specified in Article VIII, adjust the Asset Quality Matrix to account for changes in the interest rates of any of the Rated Notes (subject to satisfaction of the Moody’s Rating Condition), in each case pursuant to a supplemental indenture entered pursuant to Article VIII without the consent of any Holders other than a Majority of the Subordinated Notes.
ARTICLE X
ACCOUNTS, ACCOUNTINGS AND RELEASES
Collection of Money. Except as otherwise expressly providedSection 10.1herein, the Collateral AgentTrustee may demand payment or delivery of, and shall receive andcollect, directly and without intervention or assistance of any fiscal agent or other intermediary,all Money and other property payable to or receivable by the Collateral AgentTrustee pursuant tothis Indenture and Security Agreement, including all payments due on the Pledged Obligations,in accordance with the terms and conditions of such Pledged Obligations. The Collateral AgentTrustee shall segregate and hold all such Money and property received by it in trust for theHolders of the DebtNotes and shall apply it as provided in this Indenture and Security Agreement.
Collection Accounts. (a) The Collateral AgentTrustee shall, on orSection 10.2prior to the Closing Date, establish at the Custodian two segregated non-interest bearingaccounts, each held in the name of the Collateral AgentTrustee as Entitlement Holder for thebenefit of the Secured Parties, one of which shall be designated the “Interest Collection Subaccount” and the other of which shall be designated the “Principal Collection Subaccount,”each of which shall be maintained by the Issuer with the Custodian in accordance with theSecurities Account Control Agreement. The Collateral AgentTrustee shall from time to timedeposit into the Interest Collection Subaccount, in addition to the deposits required pursuant toSection 10.5(a), immediately upon receipt thereof (i) any funds in the Interest Reserve Accountdeemed by the Investment Manager in its sole discretion (with notice to the Collateral AgentTrustee and the Collateral Administrator) to be Interest Proceeds pursuant to Section 10.3(e) and (ii) all Interest Proceeds (unless designated as Principal Proceeds in accordance withthe definition of “Interest Proceeds”) received by the Collateral AgentTrustee. The Collateral AgentTrustee shall deposit immediately upon receipt thereof all other amounts remitted to theCollection Account into the Principal Collection Subaccount, including in addition to thedeposits required pursuant to Section 10.5(a), (i) any funds in the Interest Reserve Accountdeemed by the Investment Manager in its sole discretion (with notice to the Collateral AgentTrustee and the Collateral Administrator) to be Principal Proceeds pursuant to Section 10.3(e), (ii) all Principal Proceeds (unless simultaneously reinvested in additional CollateralObligations in accordance with Article XII or in Eligible Investments) received by the Collateral AgentTrustee, and (iii) all other funds received by the Collateral AgentTrustee. All Moniesdeposited from time to time in the Collection Account pursuant to this Indenture and Security Agreement shall be held by the Collateral AgentTrustee as part of the Assets and shall be applied
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to the purposes herein provided. Subject to Section 10.2(c), amounts in the Collection Accountshall be reinvested pursuant to Section 10.5(a).
The Collateral AgentTrustee, within one Business Day after receipt of any(b)distribution or other proceeds in respect of the Assets which are not Cash or Equity Securities,shall so notify or cause the Issuer and the Investment Manager to be notified and the InvestmentManager on behalf of the Issuer shall use its commercially reasonable efforts to, within five (5)Business Days of receipt of such notice from the Collateral AgentTrustee (or as soon aspracticable thereafter), sell such distribution or other proceeds for Cash in an arm’s lengthtransaction to a Person which is not the Investment Manager or an Affiliate of the Issuer or theInvestment Manager and deposit the proceeds thereof in the Collection Account; provided thatthe Investment Manager (on behalf of the Issuer) (i) need not sell such distributions or otherproceeds if it delivers an Officer’s certificate to the Collateral AgentTrustee certifying that suchdistributions or other proceeds constitute Collateral Obligations or Eligible Investments or (ii)may otherwise retain such distribution or other proceeds for up to two years from the date ofreceipt thereof if it delivers an Officer’s certificate to the Collateral AgentTrustee certifying that(x) it shall sell such distribution within such two-year period and (y) retaining such distributionis not otherwise prohibited by this Indenture and Security Agreement.
At any time when reinvestment is permitted pursuant to Article XII, the(c)Investment Manager on behalf of the Issuer may by Issuer Order direct the Collateral AgentTrustee to, and upon receipt of such Issuer Order the Collateral AgentTrustee shall,withdraw funds on deposit in the Principal Collection Subaccount representing PrincipalProceeds (including Principal Financed Accrued Interest used to pay for accrued interest on anadditional Collateral Obligation) and reinvest (or invest, in the case of funds referred to inSection 7.17) such funds in additional Collateral Obligations or, subject to satisfaction of the Permitted Securities Condition, exercise a warrant held in the Assets, in each case in accordancewith the requirements of Article XII and such Issuer Order. At any time, the InvestmentManager on behalf of the Issuer may by Issuer Order direct the Collateral AgentTrustee to, andupon receipt of such Issuer Order the Collateral AgentTrustee shall, withdraw funds on depositin the Principal Collection Subaccount representing Principal Proceeds and deposit such funds inthe Unfunded Exposure Account to meet funding requirements on Delayed Drawdown CollateralObligations or Revolving Collateral Obligations.
The Investment Manager on behalf of the Issuer may by Issuer Order(d)direct the Collateral AgentTrustee to, and upon receipt of such Issuer Order the Collateral AgentTrustee shall, pay from amounts on deposit in the Collection Account on any Business Dayduring any Interest Accrual Period (i) subject to satisfaction of the Permitted Securities Condition, any amount required to exercise a warrant held in the Assets or right to acquiresecurities in accordance with the requirements of Article XII and such Issuer Order and (ii) fromInterest Proceeds only, any Administrative Expenses (paid in the order of priority set forth in thedefinition thereof); provided that the payment of Administrative Expenses payable to theCollateral AgentTrustee, to the Bank in any capacity or to the Collateral Administrator shall notrequire such direction by Issuer Order; provided, further, that the aggregate AdministrativeExpenses paid pursuant to this Section 10.2(c) during any Collection Period shall not exceed theAdministrative Expense Cap for the related Payment Date.
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The Collateral AgentTrustee shall transfer to the Payment Account as(e)applicable, from the Collection Account, for application pursuant to Section 11.1(a) of thisIndenture and Security Agreement, on or not later than the Business Day preceding eachPayment Date, the amount set forth to be so transferred in the Distribution Report for suchPayment Date.
The Investment Manager on behalf of the Issuer may by Issuer Order(f)direct the Collateral AgentTrustee to, and upon receipt of such Issuer Order the Collateral AgentTrustee shall, transfer from amounts on deposit in the Interest Collection Subaccount onany Business Day during any Interest Accrual Period to the Principal Collection Subaccount,amounts necessary for application pursuant to Section 7.17(c).
No later than the Determination Date related to the second Payment Date (g)after a Redemption Date, if the Effective Date Deposit Condition is satisfied after giving effect to such deposit, the Investment Manager may designate Principal Proceeds to be (i) transferred to the Interest Collection Subaccount as Interest Proceeds or (ii) distributed by the Trustee directly to the Holder of Subordinated Notes.
Payment Account; Custodial Account; Ramp-Up Account; Section 10.3Expense Reserve Account; Interest Reserve Account; Unfunded Exposure Account.
Payment Account. The Collateral AgentTrustee shall, on or prior to the(a)Closing Date, establish at the Custodian a segregated non-interest bearing account which shall beheld in the name of the Collateral AgentTrustee as Entitlement Holder for the benefit of theSecured Parties, which shall be designated as the Payment Account, which shall be maintainedby the Issuer with the Custodian in accordance with the Securities Account Control Agreement.Except as provided in Section 11.1(a), the only permitted withdrawal from or application offunds on deposit in, or otherwise to the credit of, the Payment Account shall be to pay amountsdue and payable on the DebtNotes in accordance with their terms and the provisions of thisIndenture and Security Agreement and to pay Administrative Expenses and other amountsspecified herein, each in accordance with the Priority of Payments. The Co-Issuers shall nothave any legal, equitable or beneficial interest in the Payment Account other than in accordancewith the Priority of Payments. Funds in the Payment Account shall not be invested.
Custodial Account. The Collateral AgentTrustee shall, on or prior to the(b)Closing Date, establish at the Custodian a segregated non-interest bearing account which shall beheld in the name of the Collateral AgentTrustee as Entitlement Holder for the benefit of theSecured Parties, which shall be designated as the Custodial Account, which shall be maintainedby the Issuer with the Custodian in accordance with the Securities Account Control Agreement.The only permitted withdrawals from the Custodial Account shall be in accordance with theprovisions of this Indenture and Security Agreement. The Co-Issuers shall not have any legal,equitable or beneficial interest in the Custodial Account other than in accordance with thePriority of Payments.
Ramp-Up Account. The Collateral AgentTrustee shall, on or prior to the(c)Closing Date, establish at the Custodian a single, segregated non-interest bearing account held in
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the name of the Collateral AgentTrustee as Entitlement Holder for the benefit of the SecuredParties, and shall be designated as the Ramp-Up Account, which shall be maintained by theIssuer with the Custodian in accordance with the Securities Account Control Agreement. The Issuer hereby directs the Collateral Agent to deposit U.S.$513,997,149.69 to the Ramp-Up Account on the Closing Date. In connection with any purchase of an additional CollateralObligation, the Collateral AgentTrustee shall apply amounts held in the Ramp-Up Account asprovided by Section 7.17(a). On the first Business Day after a Bank Officer of the Collateral AgentTrustee has received written notice from the Investment Manager making reference to theaccount transfer required by this paragraph and stating that no Moody’s Ramp-Up Failure hasoccurred, or upon the occurrence of an Event of Default, the Collateral AgentTrustee shalldeposit amounts remaining in the Ramp-Up Account (excluding any proceeds that shall be usedto settle binding commitments entered into prior to that date, and except as provided in the nextproviso), as directed by the Investment Manager, into the Interest Collection Subaccount asInterest Proceeds and/or into the Principal Collection Subaccount as Principal Proceeds;provided that not more than 1% of the Aggregate Ramp-Up Par Amount may be so designated asInterest Proceeds and such excess funds may only be so designated as Interest Proceeds if, onsuch date, the Aggregate Principal Balance of the Collateral Obligations and the EligibleInvestments constituting Principal Proceeds are greater than or equal to the Aggregate Ramp-UpPar Amount after giving effect to such designation. Any income earned on amounts deposited inthe Ramp-Up Account shall be deposited in the Interest Collection Subaccount as InterestProceeds.
Expense Reserve Account. The Collateral AgentTrustee shall, on or prior(d)to the Closing Date, establish at the Custodian a segregated non-interest bearing account whichshall be held in the name of the Collateral AgentTrustee as Entitlement Holder for the benefit ofthe Secured Parties, which shall be designated as the Expense Reserve Account, which shall bemaintained by the Issuer with the Custodian in accordance with the Securities Account ControlAgreement. The Issuer hereby directs the Collateral Agent to deposit U.S.$2,233,690 from the proceeds of the sale of the Debt to the Expense Reserve Account as Interest Proceeds on the Closing Date. The Collateral AgentThe Trustee shall apply funds from the Expense ReserveAccount, in the amounts and as directed in writing by the Investment Manager, (w) to payamounts due in respect of actions taken on or before the Closing Date, (x) subject to theAdministrative Expense Cap, to pay Administrative Expenses in the order of priority containedin the definition thereof or (y) to be transferred on the Payment Date following the EffectiveDate at the written direction of the Investment Manager to the Collection Account as InterestProceeds. Any income earned on amounts on deposit in the Expense Reserve Account shall bedeposited in the Interest Collection Subaccount as Interest Proceeds as it is paid.
Interest Reserve Account. The Collateral AgentTrustee shall, on or prior(e)to the Closing Date, establish at the Custodian a segregated non-interest bearing account whichshall be held in the name of the Collateral AgentTrustee as Entitlement Holder for the benefit ofthe Secured Parties, which shall be designated as the Interest Reserve Account, which shall bemaintained by the Issuer with the Custodian in accordance with the Securities Account ControlAgreement. The Issuer hereby directs the Collateral Agent to deposit U.S.$3,250,000 to the Interest Reserve Account on the Closing Date. On any date prior to the Determination Date relating to the Payment Date occurring in April 2015, the Issuer, at the direction of the Investment Manager, by Issuer Order, may direct that all or any portion of funds in the Interest
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Reserve Account be deposited in the Collection Account as Interest Proceeds and/or Principal Proceeds (in the respective amounts directed by the Investment Manager in its sole discretion) as long as, after giving effect to such deposits, the Investment Manager determines (as certified in such Issuer Order) that the Issuer shall have sufficient funds in the Collection Account to pay Administrative Expenses pursuant to clause (A), the Senior Management Fee and any Senior Management Fee Interest thereon pursuant to clause (B) and any amounts on the Rated Debt pursuant to clauses (D), (E), (G), (H), (J), (K), (M), (N), (P) and (Q) of Section 11.1(a)(i) on the Payment Dates occurring between such date and the April 2015 Payment Date (including the April 2015 Payment Date). On the earlier of (i) the Determination Date relating to the Payment Date occurring in April 2015 and (ii) the Determination Date next succeeding the Effective Date, all funds in the Interest Reserve Account shall be deposited in the Collection Account as Interest Proceeds. Any income earned on amounts deposited in the Interest Reserve Account shall bedeposited in the Interest Collection Subaccount as Interest Proceeds as it is paid.
Unfunded Exposure Account. Upon the purchase of any Delayed(f)Drawdown Collateral Obligation or Revolving Collateral Obligation identified by written noticeto the Collateral AgentTrustee, funds in an amount equal to the undrawn portion of suchobligation shall be withdrawn first, from the Ramp-Up Account and, if necessary, from thePrincipal Collection Subaccount and deposited by the Collateral AgentTrustee in a segregatednon-interest bearing account which shall be held in the name of the Collateral AgentTrustee asEntitlement Holder for the benefit of the Secured Parties, which shall be designated as theUnfunded Exposure Account, which shall be maintained by the Issuer with the Custodian inaccordance with the Securities Account Control Agreement. The Issuer hereby directs the Collateral Agent to deposit U.S.$0.00 to the Unfunded Exposure Account on the Closing Date. Upon initial purchase of any such obligations, funds deposited in the Unfunded ExposureAccount in respect of any Delayed Drawdown Collateral Obligation or Revolving CollateralObligation will be treated as part of the purchase price therefor. Amounts on deposit in theUnfunded Exposure Account will be invested in overnight funds that are Eligible Investmentsselected by the Investment Manager pursuant to Section 10.5 and earnings from all suchinvestments will be deposited in the Interest Collection Subaccount as Interest Proceeds.
The Issuer shall at all times maintain sufficient funds on deposit in the UnfundedExposure Account such that the sum of the amount of funds on deposit in the UnfundedExposure Account shall be equal to or greater than the sum of the unfunded funding obligationsunder all such Delayed Drawdown Collateral Obligations and Revolving Collateral Obligationsthen included in the Assets. Funds shall be deposited in the Unfunded Exposure Account uponthe purchase of any Delayed Drawdown Collateral Obligation or Revolving CollateralObligation and upon the receipt by the Issuer of any Principal Proceeds with respect to aRevolving Collateral Obligation as directed by the Investment Manager on behalf of the Issuer.In the event of any shortfall in the Unfunded Exposure Account, the Investment Manager (onbehalf of the Issuer) may direct the Collateral AgentTrustee to, and the Collateral AgentTrusteethereafter shall, transfer funds in an amount equal to such shortfall from the Principal CollectionSubaccount to the Unfunded Exposure Account.
Any funds in the Unfunded Exposure Account (other than earnings from EligibleInvestments therein) will be available solely to cover any drawdowns on the Delayed DrawdownCollateral Obligations and Revolving Collateral Obligations; provided that any excess of (A) the
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amounts on deposit in the Unfunded Exposure Account over (B) the sum of the unfundedfunding obligations under all Delayed Drawdown Collateral Obligations and RevolvingCollateral Obligations may be transferred by the Collateral AgentTrustee (at the written directionof the Investment Manager on behalf of the Issuer) from time to time as Principal Proceeds to thePrincipal Collection Subaccount.
The Permitted Use Account. The Trustee shall, on or about the (g)Amendment Date, establish a segregated non-interest bearing trust account, which will be designated as the “Permitted Use Account.”
Hedge Counterparty Collateral Account. If and to the extent thatSection 10.4any Hedge Agreement requires the Hedge Counterparty to post collateral with respect to suchHedge Agreement, the Issuer shall (at the direction of the Investment Manager), on or prior tothe date such Hedge Agreement is entered into, direct the Collateral AgentTrustee to establish inthe name of the Collateral AgentTrustee a segregated, non-interest bearing account which shallbe designated as a Hedge Counterparty Collateral Account (each, a “Hedge Counterparty Collateral Account”). The Collateral AgentTrustee (as directed in writing by the InvestmentManager on behalf of the Issuer) shall deposit into each Hedge Counterparty Collateral Accountall collateral required to be posted by a Hedge Counterparty and all other funds and propertyrequired by the terms of any Hedge Agreement to be deposited into the Hedge CounterpartyCollateral Account, in accordance with the terms of the related Hedge Agreement. The onlypermitted withdrawals from or application of funds or property on deposit in the HedgeCounterparty Collateral Account shall be in accordance with the written instructions of theInvestment Manager.
Reinvestment of Funds in Accounts; Reports by Collateral Section 10.5AgentTrustee. (a) By Issuer Order (which may be in the form of standing instructions), theIssuer (or the Investment Manager on behalf of the Issuer) shall at all times direct the Collateral AgentTrustee to, and, upon receipt of such Issuer Order, the Collateral AgentTrustee shall, investall funds on deposit in the Collection Account, the Ramp-Up Account, the Expense ReserveAccount, the Permitted Use Account, the Unfunded Exposure Account and the Interest ReserveAccount as so directed in Eligible Investments having Stated Maturities no later than theBusiness Day preceding the next Payment Date (or such shorter maturities expressly providedherein). If prior to the occurrence of an Event of Default, the Issuer shall not have given anysuch investment directions, the Collateral AgentTrustee shall seek instructions from theInvestment Manager within three Business Days after transfer of any funds to such accounts. Ifthe Collateral AgentTrustee does not thereafter receive written instructions from the InvestmentManager within five Business Days after transfer of such funds to such accounts, it shall investand reinvest the funds held in such accounts, as fully as practicable, in an investment vehicle(which shall be an Eligible Investment) designated as such by the Investment Manager to theCollateral AgentTrustee in writing on or before the Closing Date, (such investment, until and asit may be changed from time to time as hereinafter provided, the “Standby Directed Investment”), until investment instruction as provided in the preceding sentence is received bythe Collateral AgentTrustee; or, if the Collateral AgentTrustee from time to time receives astanding written instruction from the Investment Manager expressly stating that it is changingthe “Standby Directed Investment” under this paragraph, the Standby DesignatedDirectedInvestment may thereby be changed to an Eligible Investment of the type described in clause (ii)
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of the definition of “Eligible Investments” maturing no later than the Business Day immediatelypreceding the next Payment Date (or such shorter maturities expressly provided herein) asdesignated in such instruction. If after the occurrence of an Event of Default, the Issuer shall nothave given such investment directions to the Collateral AgentTrustee for three consecutive days,the Collateral AgentTrustee shall invest and reinvest such Monies as fully as practicable inEligible Investments of the type described in clause (ii) of the definition of “EligibleInvestments” maturing not later than the earlier of (i) 30 days after the date of such investment(unless putable at par to the issuer thereof) or (ii) the Business Day immediately preceding thenext Payment Date (or such shorter maturities expressly provided herein). Except to the extentexpressly provided otherwise herein, all interest and other income from such investments shallbe deposited in the Interest Collection Subaccount, any gain realized from such investments shallbe credited to the Principal Collection Subaccount upon receipt, and any loss resulting from suchinvestments shall be charged to the Principal Collection Subaccount. The Collateral AgentTrustee shall not in any way be held liable by reason of any insufficiency of such accountswhich results from any loss relating to any such investment; provided that the foregoing shall notrelieve the Bank of its obligations under any security or obligation issued by the Bank or anyAffiliate thereof.
The Collateral AgentTrustee agrees to give the Issuer immediate notice if(b)the Collateral AgentTrustee becomes aware that any Account or any funds on deposit in anyAccount, or otherwise to the credit of an Account, shall become subject to any writ, order,judgment, warrant of attachment, execution or similar process. All Accounts shall remain at alltimes with a financial institution (which may be the Collateral AgentTrustee) (w) in the case ofCash-Accounts, having a long-term debt rating at least equal to “A2” and a short-term debtrating of “P-1” by Moody’s, (x) in the case of non-Cash holding Accounts only, in segregatedtrust accounts with the corporate trust department of a federal or state-chartered depositinstitution subject to regulations regarding fiduciary funds on deposit similar to Title 12 of theCode of Federal Regulation Section 9.10(b) and such depository institution shall be rated at least“Baa1” by Moody’s, (y) in the case of any Account, having a short-term issuer default rating atleast equal to “F1” and a long-term issuer default rating at least equal to “A” by Fitch (or, if noshort-term issuer default rating exists, a long-term issuer default rating of not lower than “A+”by Fitch) and (z) in the case of any Account, such institution has a combined capital and surplusof at least $200,000,000. If at any time the ratings of a financial institution maintaining anyAccounts fail to meet the required ratings set forth above, the Issuer shall cause the assets held insuch Accounts to be moved within 30 calendar days to another institution that satisfies therequirements of clauses (x), (y) and (z) above.
The Collateral AgentTrustee shall supply, in a timely fashion, to the(c)Co-Issuers, the Investment Manager, the Trustee, the Loan Agent, the Collateral Administratorand each Rating Agency any information regularly maintained by the Collateral AgentTrusteethat the Co-Issuers, the Collateral Administrator, the Trustee, the Loan Agent, the RatingAgencies or the Investment Manager may from time to time request in writing with respect to thePledged Obligations, the Accounts and the other Assets and provide any other requestedinformation reasonably available to the Collateral AgentTrustee by reason of its acting asCollateral AgentTrustee hereunder and required to be provided by Section 10.6, to permit theInvestment Manager to perform its obligations under the Investment Management Agreement orthe Collateral Administration Agreement or to permit the Collateral Administrator to perform its
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obligations under the Collateral Administration Agreement. The Collateral AgentTrustee shallpromptly forward to the Investment Manager copies of notices and other writings received by itfrom the Obligor of any Collateral Obligation or from any Clearing Agency with respect to anyCollateral Obligation which notices or writings advise the holders of such security of any rightsthat the holders might have with respect thereto (including, without limitation, requests to votewith respect to amendments or waivers and notices of prepayments and redemptions) as well asall periodic financial reports, and other communications received from such Obligor andClearing Agencies with respect to such Obligor.
Accountings.Section 10.6
Monthly. Not later than the [seventh Business Day] following the(a)Monthly Report Determination Date, commencing in November 2014 (in respect of the MonthlyReport Determination Date falling in November 2014), the Issuer shall compile and makeavailable (or cause to be compiled and made available) (including, at the election of the Issuer,via appropriate electronic means acceptable to each recipient) to each Rating Agency, theTrustee, the Collateral Agent, the Loan Agent, the Investment Manager, the Placement Agent[and the Irish Stock Exchange (so long as any Notes are listed on the Irish Stock Exchange)] and,upon written request therefor, to any Holder shown on the Register or, in the case of the Class A Loans, to the Class A Lender and, upon written notice to the Trustee in the form of Exhibit D,any beneficial owner of Debta Note, a monthly report (each a “Monthly Report”) determined asof (i) in the case of a Monthly Report prepared in connection with a Payment Date, the relatedDetermination Date or (ii) otherwise, the 8theighth calendar day of such month (such date ofdetermination, the “Monthly Report Determination Date”). The Monthly Report shall containthe following information with respect to the Collateral Obligations and Eligible Investmentsincluded in the Assets (based, in part, on information provided by the Investment Manager):
Aggregate Principal Balance of Collateral Obligations and Eligible(i)Investments representing Principal Proceeds.
Adjusted Collateral Principal Amount of Collateral Obligations.(ii)
Collateral Principal Amount of Collateral Obligations.(iii)
A list of Collateral Obligations, including, with respect to each such(iv)Collateral Obligation, the following detailed information:
The obligorObligor thereon (including the issuer ticker, if any);(A)
The LoanX ID, CUSIP or security identifier thereof;(B)
The Principal Balance thereof (other than any accrued interest that(C)was purchased with Principal Proceeds (but noting any capitalized interest));
The percentage of the aggregate Collateral Principal Amount(D)represented by such Collateral Obligation;
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The related interest rate or spread (excluding, in the case where(E)such Collateral Obligation is a Libor Floor Obligation, the effect of any specified“floor” rate per annum related thereto);
The stated maturity thereof;(F)
The related Moody’s Industry Classification;(G)
The related S&P Industry Classification;(H)
The Moody’s Rating, unless such rating is based on a credit(I)estimate unpublished by Moody’s (and, in the event of a downgrade orwithdrawal of the applicable Moody’s Rating, the prior rating and the date suchMoody’s Rating was changed) and if based on a credit estimate, the date suchcredit estimate was last provided (or updated) by Moody’s to the Issuer;
The Moody’s Default Probability Rating;(J)
The S&P Rating, unless such rating is based on a credit(K)opinionestimate unpublished by S&P or such rating is a confidential rating or aprivate rating by S&P;
(1) The country of Domicile and (2) an indication as to whether the (L)country of Domicile was determined pursuant to clause (c) of the definition thereof and the identity of the related guarantor;
An indication as to whether each such Collateral Obligation is (1)(M)a Defaulted Obligation, (2) a Senior Secured Loan, Senior Secured Bond,Unsecured Bond, Senior Secured Note, High Yield Bond, Second Lien Loan orSenior Unsecured Loan, (3) a floating rate or fixed rate Collateral Obligation, (4)a Participation Interest (indicating the related Selling Institution and its ratings byeach Rating Agency), (5) a Current Pay Obligation, (6) a DIP CollateralObligation, (7) convertible into or exchangeable for equity securities, (8) aDiscount Obligation (including its purchase price and purchase yield in the caseof a fixed rate Collateral Obligation), (9) a Cov-Lite Loan, (10) a First-Lien Last-Out Loan, (11) a Deferrable Obligation, (12) a Delayed Drawdown CollateralObligation, (13) a Revolving Collateral Obligation, (14) a Purposely DeferringObligation, (15) a Step-UpLong Dated Obligation or (16) would be a Step-Down ObligationCov-Lite Loan but for the application of the proviso in the definition thereof;
With respect to each Collateral Obligation that is a Discount(N)Obligation purchased in the manner described in the last paragraph of thedefinition Discount Obligation,
the identity of the Collateral Obligation (including whether(1)such Collateral Obligation was classified as a Discount Obligation at the
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time of its original purchase) the proceeds of whose sale are used topurchase the purchased Collateral Obligation;
the purchase price (as a percentage of par) of the purchased(2)Collateral Obligation and the sale price (as a percentage of par) of theCollateral Obligation the proceeds of whose sale are used to purchase thepurchased Collateral Obligation;
the Moody’s Default Probability Rating assigned to the(3)purchased Collateral Obligation and the Moody’s Default ProbabilityRating assigned to the Collateral Obligation the proceeds of whose saleare used to purchase the purchased Collateral Obligation; and
the Aggregate Principal Balance of Collateral Obligations(4)that have been excluded from the definition of Discount Obligation andrelevant calculations indicating whether such amount is in compliancewith the limitations described in the first proviso in the last paragraph ofthe definition of Discount Obligation;
With respect to each obligation that is acquired or received in a (O)Bankruptcy Exchange,
the identity of such obligation (including whether such (1)Collateral Obligation was classified as a Defaulted Obligation or Credit Risk Obligation at the time of its acquisition or receipt); and
the Aggregate Principal Balance of obligations that have (2)been received in a Bankruptcy Exchange and relevant calculations indicating whether such amount is in compliance with the limitations described in the definition of Bankruptcy Exchange
(O) The Moody’s Recovery Rate;(P)
(P) Whether such Collateral Obligation is a Libor Floor(Q)Obligation, the specified “floor” rate per annum related thereto as specified by theInvestment Manager and the applicable libor rate or other applicable base rate forsuch Collateral Obligation excluding the effect of any specified “floor” raterelated thereto;
(Q) The purchase price and the Market Value of such Collateral(R)Obligation, if such Market Value was calculated based on a bid price determinedby a loan or bond pricing service, and the name of such loan or bond pricingservice (including such disclaimer language as a loan or bond pricing service mayfrom time to time require, as provided by the Investment Manager to theCollateral AgentTrustee and the Collateral Administrator);
(R) Whether such Collateral Obligation was acquired from or sold(S)to, as applicable, an Affiliate of the Investment Manager;
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(S) Whether the Obligor with respect to such Collateral Obligation (T)is a portfolio company of the Investment Manager or any of its Affiliates;
Whether such Collateral Obligation is settled or unsettled; and(U)
(T) The Moody’s Rating Factor used in the determination of the(V)Moody’s Weighted Average Rating Factor; and
The percentage of the aggregate Collateral Principal Amount (W)represented by all Long Dated Obligations in the aggregate.
For each of the limitations and tests specified in the definitions of(v)“Concentration Limitations” and “Portfolio Quality Test”, (1) the result, (2) the relatedminimum or maximum test level (including any Moody’s Weighted Average RecoveryAdjustment) and (3) a determination as to whether such result satisfies the related test.
The Moody’s Weighted Average Rating Factor.(vi)
The Moody’s Weighted Average Recovery Rate.(vii)
The Diversity Score.(viii)
The calculation of each of the following:(ix)
From and after the Determination Date immediately preceding the (A)third Payment Date, each Interest Coverage Ratio (and setting forth each relatedRequired Coverage Ratio);
Each Par Value Ratio (and setting forth each related Required(B)Coverage Ratio); and
The Reinvestment Diversion Test (and setting forth the required(C)test level); and(D) The Rating Agency Surveillance Weighted Average Floating Spread.
For each Account, a schedule showing the beginning balance, each credit(x)or debit specifying the nature, source and amount and the ending balance.
A schedule showing for each of the following the beginning balance, the(xi)amount of Interest Proceeds received from the date of determination of the immediatelypreceding Monthly Report, and the ending balance for the current Measurement Date:
Interest Proceeds from Collateral Obligations; and(A)
Interest Proceeds from Eligible Investments.(B)
A list of all Eligible Investments held during such calendar month.(xii)
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Purchases, prepayments and sales:(xiii)
The (1) identity, (2) purchase price, (3) purchase date, (4) sale(A)price, (5) Principal Balance (other than any accrued interest that was purchasedwith Principal Proceeds (but noting any capitalized interest)) and purchase pricepaid, (6) sale proceeds received (and whether Principal Proceeds or InterestProceeds), (7) gain (excess of the Principal Proceeds received over purchase pricepaid), (8) loss (excess of the purchase price paid over the Principal Proceedsreceived) and (9) the date for (X) each Collateral Obligation that was released forsale or disposition pursuant to Section 12.1 or prepaid since the date ofdetermination of the immediately preceding Monthly Report and (Y) eachprepayment, repayment at maturity or redemption of a Collateral Obligation, andin the case of (X), whether such Collateral Obligation was a Credit RiskObligation, Defaulted Obligation or a Credit Improved Obligation, whether thesale of such Collateral Obligation was a discretionary sale and whether such saleof a Collateral Obligation was to an Affiliate of the Investment Manager; and
The (1) identity, (2) purchase date, (3) Principal Balance (other(B)than any accrued interest that was purchased with Principal Proceeds (but notingany capitalized interest)) and purchase price, (4) the purchase price paid (andwhether Principal Proceeds or Interest Proceeds were expended to acquire suchCollateral Obligation) and (5) excess, as applicable, of the purchase price over thePrincipal Balance or of the Principal Balance over the purchase price of eachCollateral Obligation acquired pursuant to Section 12.2 since the date ofdetermination of the immediately preceding Monthly Report and whether suchCollateral Obligation was obtained through a purchase from an Affiliate of theInvestment Manager.
The identity of each Defaulted Obligation, and the Moody’s Collateral(xiv)Value of each such Defaulted Obligation and date of default thereof.
The identity of each Collateral Obligation with an S&P Rating of “CCC+” (xv)or below and/or a Moody’s Rating of “Caa1” or below and the Market Value of eachsuch Collateral Obligation.
The identity of each Current Pay Obligation, the Market Value of each(xvi)such Current Pay Obligation, the percentage of the Collateral Principal Amountcomprised of Current Pay Obligations, the portfolio limitation for Current PayObligations expressed as a percentage of the Collateral Principal Amount and whethersuch limitation is satisfied.
The Market Value of each Collateral Obligation for which a Market Value(xvii)was required to be calculated pursuant to the terms of this Indenture and Security Agreementas provided by the Investment Manager.
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The identity of the Issuer Subsidiary and the identity of each Collateral(xviii)Obligation, Equity Security or Defaulted Obligation, if any, held by such IssuerSubsidiary.
The amount of Cash, if any, held in any Issuer Subsidiary.(xix)
The total number of (and related dates of) any Trading Plans occurring(xx)during such month, the identity of each Collateral Obligation that was subject to aTrading Plan during such month, and the percentage of the Collateral Principal Amountconsisting of the Collateral Obligations subject to each such Trading Plan.
The identity of any non-LIBOR-based floating rate obligation.(xxi)
After the end of the Reinvestment Period only, the stated maturity of any (xxii)Credit Risk Obligation that is sold or Collateral Obligation that is subject to an Unscheduled Principal Payment and the stated maturity of any Collateral Obligation purchased with the related proceeds.
An indication as to whether the Permitted Securities Condition has been (xxiii)satisfied.
The amount of any Contribution made since the previous Monthly Report (xxiv)Determination Date and on or prior to the current Monthly Report Determination Date (if any) and whether such Contribution (or portion thereof) is a Cure Contribution. For the avoidance of doubt, each Monthly Report does not reflect Contributions received after the related Monthly Report Determination Date in any manner.
The “Recovery Rate Modifier” in the Recovery Rate Modifier Matrix that (xxv)corresponds to the then-applicable “row/column combination.”
(xxii) Such other information as the Collateral AgentTrustee, any Hedge(xxvi)Counterparty, any Rating Agency or the Investment Manager may reasonably request.
(xxiii) After the Ramp-Up Period, a schedule identifying any amounts that are deposited into the Interest Collection Subaccount as Interest Proceeds and/or into the Principal Collection Subaccount as Principal Proceeds pursuant to Section 10.3(c).
(xxiv) After the Reinvestment Period, a schedule showing the maturity date for each (x) sold Credit Risk Obligation and Collateral Obligation with respect to which Unscheduled Principal Payments are received and (y) Collateral Obligation the Issuer has purchased with respect to the Principal Proceeds from such Credit Risk Obligation or Unscheduled Principal Payments.
Upon receipt of each Monthly Report, the Collateral AgentTrustee shall, if theCollateral AgentTrustee is not the same Person as the Collateral Administrator, compare theinformation contained in such Monthly Report to the information contained in its records withrespect to the Assets and shall, within three (3) Business Days after receipt of such Monthly
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Report, notify the Issuer, the Collateral Administrator, the Investment Manager, and the RatingAgencies if the information contained in the Monthly Report does not conform to theinformation maintained by the Collateral AgentTrustee with respect to the Assets. In the eventthat any discrepancy exists, the Collateral AgentTrustee, the Issuer, or the Investment Manageron behalf of the Issuer and the Collateral Administrator, shall attempt to resolve the discrepancy.If such discrepancy cannot be promptly resolved, the Collateral AgentTrustee shall within five (5) Business Days cause the Independent accountants appointed by the Issuer pursuant to Section 10.8 to perform agreed-upon procedures on such Monthly Report and the Collateral AgentTrustee’s records to determine the cause of such discrepancy. If such review reveals anerror in the Monthly Report or the Collateral AgentTrustee’s records, the Monthly Report or theCollateral AgentTrustee’s records shall be revised accordingly and, as so revised, shall beutilized in making all calculations pursuant to this Indenture and Security Agreement and noticeof any error in the Monthly Report shall be sent as soon as practicable by the Issuer to allrecipients of such report.
Payment Date Accounting. The Issuer shall render (or cause to be(b)rendered) a report (each a “Distribution Report”), determined as of the close of business on eachDetermination Date preceding a Payment Date, and shall make available such DistributionReport (including, at the election of the Issuer, via appropriate electronic means acceptable toeach recipient) to the Trustee, the Collateral Agent, the Investment Manager, the PlacementAgent and the Rating Agencies and, upon written request therefor, any Holder shown on theRegister or, in the case of the Class A Loans, to the Class A Lender and, upon written notice tothe Collateral AgentTrustee in the form of Exhibit D, any beneficial owner of DebtNotes notlater than the Business Day preceding the related Payment Date. The Distribution Report shallcontain the following information (based, in part, on information provided by the InvestmentManager):
the Aggregate Principal Balance of Collateral Obligations and Eligible(i)Investments representing Principal Proceeds;
(a) the Aggregate Outstanding Amount of the Rated DebtNotes of each(ii)Class at the beginning of the Interest Accrual Period and such amount as a percentage ofthe original Aggregate Outstanding Amount of the Rated DebtNotes of such Class, theamount of principal payments to be made on the Rated DebtNotes of each Class on thenext Payment Date, the amount of any Deferred Interest on each Class of Deferred InterestDeferrable Notes, and the Aggregate Outstanding Amount of the RatedDebtNotes of each Class after giving effect to the principal payments, if any, on the nextPayment Date and such amount as a percentage of the original Aggregate OutstandingAmount of the Rated DebtNotes of such Class and (b) the Aggregate OutstandingAmount of the Subordinated Notes at the beginning of the Interest Accrual Period andsuch amount as a percentage of the original Aggregate Outstanding Amount of theSubordinated Notes, the amount of payments to be made on the Subordinated Notes inrespect of Subordinated Note Redemption Price on the next Payment Date, and theAggregate Outstanding Amount of the Subordinated Notes after giving effect to suchpayments, if any, on the next Payment Date and such amount as a percentage of theoriginal Aggregate Outstanding Amount of the Subordinated Notes;
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the DebtNote Interest Rate and accrued interest for each applicable Class(iii)of Rated DebtNotes for such Payment Date;
the amounts payable pursuant to each Clause of Section 11.1(a)(i) and(iv)each Clause of Section 11.1(a)(ii) and each Clause of Section 11.1(a)(iii) and each Clause of Section 11.1(a)(iv) on the related Payment Date;
for the Collection Account:(v)
the Balance on deposit in the Collection Account at the end of the(A)related Collection Period (or, with respect to the Interest Collection Subaccount,the next Business Day);
the amounts payable from the Collection Account to the Payment(B)Account, in order to make payments pursuant to Section 11.1(a)(i) and Section 11.1(a)(ii) and Section 11.1(a)(iii) and Section 11.1(a)(iv) on the next PaymentDate (net of (I) amounts which the Investment Manager has committed tore-invest in additional Collateral Obligations pursuant to Article XII, (II) duringthe Reinvestment Period, Principal CollectionsProceeds received in the last thirty(30) days of the related Collection Period and (III) following the ReinvestmentPeriod, Principal CollectionsProceeds received with respect to sales of CreditRisk Obligations and Unscheduled Principal Payments received and notreinvested in the related Collection Period); and
the Balance remaining in the Collection Account immediately after(C)all payments and deposits to be made on such Payment Date;
the amount of the Senior Management Fee to be deferred by the(vi)Investment Manager pursuant to Section 11.1(f) on the related Payment Date and theaggregate Deferred Senior Management Fee after giving effect to any deferrals and anypayments of the Deferred Senior Management Fee on the related Payment Date;
each Interest Coverage Ratio (and setting forth each related Required(vii)Coverage Ratio); each Par Value Ratio (and setting forth each related Required CoverageRatio); and the Reinvestment Diversion Test (and setting forth the required test level);and
such other information as the Collateral AgentTrustee, any Hedge(viii)Counterparty or the Investment Manager may reasonably request.
Each Distribution Report shall constitute instructions to the Collateral AgentTrustee to withdraw funds from the Payment Account and pay or transfer such amounts setforth in Distribution Report in the manner specified and in accordance with the prioritiesestablished in Section 11.1 and Article XIII.
Interest Rate Notice. The Collateral AgentAdministrator shall make(c)available to each Holder of Rated DebtNotes, as soon as reasonably practicable but in any case
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no later than the sixth Business Day after each Payment Date, a notice (which may be part of the related Distribution Report) setting forth the DebtNote Interest Rate for such DebtNotes for theInterest Accrual Period preceding the next Payment Date. The TrusteeCollateral Administratorshall also make available to the Issuer and each Holder of DebtNotes, as soon as reasonablypracticable but in any case no later than the sixth Business Day after each Interest DeterminationDate, a notice setting forth LIBOR for the Interest Accrual Period following such InterestDetermination Date.
Failure to Provide Accounting. If the Collateral AgentTrustee shall not(d)have received any accounting provided for in this Section 10.6 on the first Business Day after thedate on which such accounting is due to the Collateral AgentTrustee, the Issuer shall use allreasonable efforts to cause such accounting to be made by the applicable Payment Date. To theextent the Issuer is required to provide any information or reports pursuant to this Section 10.6 asa result of the failure to provide such information or reports, the Issuer (with the assistance of theInvestment Manager) shall be entitled to retain an Independent certified public accountant inconnection therewith.
Required Content of Certain Reports. Each Monthly Report and each(e)Distribution Report sent to any Holder or beneficial owner of an interest in a Note shall contain,or be accompanied by, the following notices:
The Notes may be beneficially owned only by Persons that (a)(i) are not U.S.persons (within the meaning of Regulation S under the United States SecuritiesAct of 1933, as amended) and are purchasing their beneficial interest in anoffshore transaction or (ii) are either (A)(1) qualified institutional buyers(“Qualified Institutional Buyers”) within the meaning of Rule 144A and (2)qualified purchasers (as defined in Section 2(a)(51) of the Investment CompanyAct) (“Qualified Purchasers”), (B) (solely in the case of Certificated Rated Notes)(1) institutions that are accredited investors meeting the requirements of Rule501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act (“IAIs”) and (2)Qualified Purchasers andor (C) (solely in the case of Certificated SubordinatedNotes), (1) accredited investors meeting the requirements of Rule 501(a) underthe Securities Act who are also (x) Qualified Purchasers, (y) certainKnowledgeable Employees (as defined in Rule 3c-5 under the InvestmentCompany Act) (“Knowledgeable Employees”) or (z) any entity owned exclusively by Qualified Purchasers and/or Knowledgeable Employeeswith respect to the Issuer or (2), in the case of subsequent transfers only, accreditedinvestors meeting the requirements of Rule 501(a) of Regulation D under theSecurities Act who are also Qualified Purchasers and (b) can make therepresentations set forth in Section 2.6 or the appropriate Exhibit to this Indenture and Security Agreement. Beneficial ownership interests in the Rule 144A GlobalRated Notes may be transferred only to a Person that is both a QualifiedInstitutional Buyer and a Qualified Purchaser and that can make therepresentations referred to in clause (b) of the preceding sentence. The Issuer hasthe right to compel any beneficial owner of an interest in Rule 144A Global RatedNotes that does not meet the qualifications set forth in such clauses to sell its
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interest in such Notes, or may sell such interest on behalf of such owner, pursuantto Section 2.12.
Each Holder or beneficial owner of a Note receiving this report agrees to keep allnon-public information herein confidential and not to use such information forany purpose other than its evaluation of its investment in the Note; provided thatany such Holder or beneficial owner may provide such information on aconfidential basis to any prospective purchaser of such Holder’s or beneficialowner’s Notes that is permitted by the terms of this Indenture and Security Agreement to acquire such Holder’s or beneficial owner’s Notes and that agreesto keep such information confidential in accordance with the terms of thisIndenture and Security Agreement.
Placement Agent Information. The Issuer and the Placement Agent, or(f)any successor to the Placement Agent, may post the information contained in a Monthly Reportor Distribution Report to a password-protected internet site accessible only to the Holders of theDebtNotes, the Trustee, the Collateral Agent and the Investment Manager.
Availability of Reports. The Monthly Reports and Distribution Reports(g)shall be made available to the Persons entitled to such reports via the Collateral AgentTrustee’swebsite. The Collateral AgentTrustee’s website shall initially be located at“https://gctinvestorreporting.bnymellon.com/Home”. Persons who are unable to use the abovedistribution option are entitled to have a paper copy mailed to them via first class mail by callingthe Collateral AgentTrustee’s customer service desk. The Collateral AgentTrustee shall have theright to change the method such reports are distributed in order to make such distribution moreconvenient and/or more accessible to the Persons entitled to such reports, and the Collateral AgentTrustee shall provide timely notification (in any event, not less than thirty (30) days) to allsuch Persons. As a condition to access to the Collateral AgentTrustee’s internet website, theCollateral AgentTrustee may require registration and the acceptance of a disclaimer. TheCollateral AgentTrustee shall not be liable for the information it is directed or required todisseminate in accordance with this Indenture and Security Agreement. The Collateral AgentTrustee shall be entitled to rely on but shall not be responsible for the content or accuracyof any information provided in the information set forth in the Monthly Report and theDistribution Report and may affix thereto any disclaimer it deems appropriate in its reasonablediscretion. Upon written request of any Holder, the Collateral AgentTrustee shall also providesuch Holder copies of reports produced pursuant to this Indenture and Security Agreement andthe Investment Management Agreement. For the avoidance of doubt, the Placement Agent shallbe entitled to receive or have access to the Monthly Reports and Distribution Reports.
(h) Irish Stock Exchange. So long as any Class of Notes is listed on the Irish Stock Exchange, the Collateral Agent shall inform the Irish Stock Exchange, if the Ratings assigned to such Rated Notes are reduced or withdrawn and such information shall be released through the Companies Announcement Office.
Release of Securities. (a) The Issuer may, by Issuer OrderSection 10.7executed by an Authorized Officer of the Investment Manager, delivered to the Collateral AgentTrustee and the Collateral Administrator no later than the settlement date for any sale of a
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security certifying that the sale of such security is being made in accordance with Section 12.1and such sale complies with all applicable requirements of Section 12.1, direct the Collateral AgentTrustee to release or cause to be released such security from the lien of this Indenture and Security Agreement and, upon receipt of such Issuer Order, the Collateral AgentTrustee shalldeliver any such security, if in physical form, duly endorsed to the broker or purchaserdesignated in such Issuer Order or, if such security is a Clearing Corporation Security, cause anappropriate transfer thereof to be made, in each case against receipt of the sales price therefor asspecified by the Investment Manager in such Issuer Order; provided that the Collateral AgentTrustee may deliver any such security in physical form for examination in accordance withstreet delivery custom; provided, further, that, notwithstanding the foregoing, the Issuer shall notdirect the Trustee to release any security pursuant to this Section 10.7(a) following theoccurrence and during the continuance of an Event of Default unless (x) such release is inconnection with a sale in accordance with Section 12.1(a), (b), (c), (d), (g) or (h) or (y) theliquidation of the Assets has begun or the Trustee has exercised any remedies of a Secured Partypursuant to Section 5.4(iv) at the direction of a Majority of the Controlling Class.
If no Event of Default has occurred and is continuing and subject to(b)Article XII hereof, the Collateral AgentTrustee shall upon an Issuer Order (i) deliver anyPledged Obligation, and release or cause to be released such security from the lien of thisIndenture and Security Agreement, which is set for any mandatory call or redemption orpayment in full to the Income Note Paying Agent on or before the date set for such call,redemption or payment, in each case against receipt of the call or redemption price or payment infull thereof and (ii) provide notice thereof to the Investment Manager.
Upon receiving actual notice of any Offer (as defined below) or any(c)request for a waiver, consent, amendment or other modification with respect to any CollateralObligation, the Collateral AgentTrustee on behalf of the Issuer shall promptly notify theInvestment Manager of any Collateral Obligation that is subject to a tender offer, voluntaryredemption, exchange offer, conversion or other similar action (an “Offer”) or such request.Subject to Section 12.2(e), the Investment Manager may direct (x) the Collateral AgentTrustee toaccept or participate in or decline or refuse to participate in such Offer and, in the case ofacceptance or participation, to release from the lien of this Indenture and Security Agreementsuch Collateral Obligation in accordance with the terms of the Offer against receipt of paymenttherefor, or (y) the Issuer or the Collateral AgentTrustee to agree to or otherwise act with respectto such consent, waiver, amendment, modification or action; provided that in the absence of anysuch direction, the Collateral AgentTrustee shall not respond or react to such Offer or request;provided, further, that if the Debt hasNotes have been accelerated following an Event of Default,any such direction may only be made with the consent of a Majority of the Controlling Class.
As provided in Section 10.2(a), the Collateral AgentTrustee shall deposit(d)any proceeds received by it from the disposition of a Pledged Obligation in the applicableaccount under the Collection Account, unless simultaneously applied to the purchase ofadditional Collateral Obligations or Eligible Investments as permitted under and in accordancewith the requirements of this Article X and Article XII.
The Collateral AgentTrustee shall, upon receipt of an Issuer Order at such(e)time as there are no Rated Notes Outstanding and all obligations of the Co-Issuers hereunder
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have been satisfied, release any remaining Assets from the lien of this Indenture and Security Agreement.
Upon receipt by the Collateral AgentTrustee of an Issuer Order from an(f)Authorized Officer of the Issuer or an Authorized Officer of the Investment Manager certifyingthat the transfer of any asset to an Issuer Subsidiary is being made in accordance with Section 7.16(i) and that all applicable requirements of Section 7.16(i) have been or shall be satisfied, theCollateral AgentTrustee shall release such Issuer Subsidiary Asset and shall deliver such IssuerSubsidiary Asset as specified in such Issuer Order.
Any security, Collateral Obligation or amounts that are released pursuant(g)to Section 10.7(a), (b), (c), or (f) shall be released from the lien of this Indenture and Security Agreement.
Reports by Independent Accountants. (a) Prior to the delivery ofSection 10.8any reports of accountants required to be prepared to be pursuant to the terms hereof, the Issuershall appoint one or more firms of Independent certified public accountants of recognizedinternational reputation for purposes of performing agreed-upon procedures required by thisIndenture and Security Agreement, which may be the firm of Independent certified publicaccountants that performs accounting services for the Issuer or the Investment Manager. TheIssuer may remove any firm of Independent certified public accountants at any time without theconsent of any Holder of DebtNotes. Upon any resignation by such firm or removal of such firmby the Issuer, the Issuer (or the Investment Manager on behalf of the Issuer) shall promptlyappoint by Issuer Order delivered to the Collateral AgentTrustee a successor thereto that shallalso be a firm of Independent certified public accountants of recognized international reputation,which may be a firm of Independent certified public accountants that performs accountingservices for the Issuer or the Investment Manager. If the Issuer shall fail to appoint a successorto a firm of Independent certified public accountants which has resigned within 30 days aftersuch resignation, the Issuer shall promptly notify the Collateral AgentTrustee of such failure inwriting. If the Issuer shall not have appointed a successor within ten days thereafter, theCollateral AgentTrustee shall promptly notify the Investment Manager, who shall appoint asuccessor firm of Independent certified public accountants of recognized internationalreputation. The fees of such Independent certified public accountants and its successor shall bepayable by the Issuer as an Administrative Expense.
Upon the written request of any Holder of a Subordinated Note, the Issuer(b)shall cause the firm of Independent certified public accountants appointed pursuant to Section 10.8(a) to provide any Holder of DebtNotes with all of the information required to be providedby the Issuer pursuant to Section 7.16 or assist the Issuer in the preparation thereof.
In the event such firm requires the Collateral AgentTrustee and/or(c)Collateral Administrator to agree to the procedures performed by such firm, the Issuer or theInvestment Manager (on its behalf) shall first direct the Collateral AgentTrustee and theCollateral Administrator (as applicable) to so agree; it being understood and agreed that theCollateral AgentTrustee and/or Collateral Administrator will deliver such letter of agreement inconclusive reliance on the direction of the Issuer or Investment Manager, and neither theCollateral AgentTrustee nor the Collateral Administrator shall make any inquiry or investigation
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as to, and shall have no obligation in respect of, the sufficiency, validity or correctness of suchprocedures.
Any statement delivered to the Collateral AgentTrustee pursuant to clause(d)(b) above from the firm of Independent certified public accountants may be requested by anyHolder directly from such accountants. Upon written notice from a Holder to the Collateral Agent, the Collateral AgentTrustee shall provide such Holder the contact information for suchaccountants.
Reports to Rating Agencies. In addition to the information andSection 10.9reports specifically required to be provided to each Rating Agency pursuant to the terms of thisIndenture and Security Agreement, the Issuer shall provide to each Rating Agency allinformation or reports delivered to the Collateral AgentTrustee hereunder (excluding anyAccountants’ Report), and such additional information as either Rating Agency may from timeto time reasonably request (including, with respect to credit estimates, notification to Moody’s ofany material modification that would result in substantial changes to the terms of any loandocument relating to a Collateral Obligation or any release of collateral thereunder not permittedby such loan documentation) in accordance with Section 14.3(b) hereof. The Issuer shall notifyMoody’s and Fitch of any termination, modification or amendment to the InvestmentManagement Agreement, the Collateral Administration Agreement, the Securities AccountControl Agreement or any other agreement to which it is party in connection with any suchagreement or this Indenture and Security Agreement and shall notify Fitch and Moody’s of anymaterial breach by any party to any such agreement of which it has actual knowledge.
Procedures Relating to the Establishment of Accounts Controlled Section 10.10by the Collateral AgentTrustee. Notwithstanding anything else contained herein, the Collateral AgentTrustee is hereby directed, with respect to each of the Accounts, to enter into the SecuritiesAccount Control Agreement with the Securities Intermediary. The Collateral AgentTrustee shallhave the right to open such subaccounts of any such account as it deems necessary or appropriatefor convenience of administration.
ARTICLE XI
APPLICATION OF MONIES
Disbursements of Monies from Payment Account. (a)Section 11.1Notwithstanding any other provision in this Indenture and Security Agreement, but subject to theother subsections of this Section 11.1, on each Payment Date, the Collateral AgentTrustee shalldisburse amounts transferred, if any, from the Collection Account to the Payment Accountpursuant to Section 10.2 in accordance with the following priorities (the “Priority of Payments”).
On each Payment Date (other than a Post-Acceleration Payment Date or(i)the Stated Maturity) and Redemption Date (other than a Refinancing or any PartialRedemption Date), Interest Proceeds that have been transferred into the PaymentAccount shall be applied in the following order of priority:
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(1) first, to the payment of franchise and similar taxes, registered(A)office and governmental fees owing by the Issuer, the Co-Issuer or the IncomeNote Issuer, if any, and (2) second, to the payment of the accrued and unpaidAdministrative Expenses (in the order set forth in the definition of such term);provided that amounts paid or deposited pursuant to clause (2) and anyAdministrative Expenses paid from the Expense Reserve Account or from theCollection Account pursuant to Section 10.2(c)(ii) on or between Payment Dates,collectively, may not exceed, in the aggregate, the Administrative Expense Cap;
to the payment of the accrued and unpaid Senior Management Fee(B)and any accrued and unpaid Senior Management Fee Interest thereon to theInvestment Manager, except to the extent that the Investment Manager elects totreat such current Senior Management Fee as Deferred Senior Management Fees;
to the payment on a pro rata basis of the following amounts based(C)on the respective amounts due on such Payment Date: (1) any amounts due to aHedge Counterparty under a Hedge Agreement other than amounts due as a resultof the termination (or partial termination) of such Hedge Agreement and (2) anyamounts due to a Hedge Counterparty under a Hedge Agreement pursuant to atermination (or partial termination) of such Hedge Agreement as a result of aPriority Hedge Termination Event;
to the payment of (1) first, pro rata based upon amounts due, (D)accrued and unpaid interest on the Class X Notes and the Class A Notes, (2) second, any Unpaid Class X Principal Amortization Amount as of such date and (3) third, the Class X Principal Amortization Amount for such Payment Date;
(D) to the payment of accrued and unpaid interest (including any(E)defaulted interest) on the Class A-1 Notes, the Class A-2 Notes and the Class A Loans, pro rata, allocated in proportion to the respective amounts of accrued and unpaid interestB Notes;
(E) to the payment of accrued and unpaid interest (including any defaulted interest) on the Class B-1 Notes and the Class B-2 Notes, pro rata, allocated in proportion to the respective amounts of accrued and unpaid interest;
if either of the Class A/B Coverage Tests (except, in the case of the (F)Interest Coverage Test, if such Payment Date is prior to the third Payment Date after the Closing Date) is not satisfied on the related Determination Date, to makepayments in accordance with the Sequential DebtNote Redemption to the extentnecessary to cause both Class A/B Coverage Tests to be met as of the relatedDetermination Date on a pro forma basis after giving effect to any payments madethrough this clause (F);
to the payment of accrued and unpaid interest (excluding any(G)Deferred Interest, but including interest on Deferred Interest) on the Class C-1
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Notes and the Class C-2 Notes, pro rata, allocated in proportion to the respective amounts of accrued and unpaid interest Notes;
(H) to the payment of any Deferred Interest on the Class C-1 Notes and the Class C-2 Notes, pro rata, allocated in proportion to the respective amounts of Deferred Interest;
(I) if either of the Class C Coverage Tests (except, in the case of (H)the Interest Coverage Test, if such Payment Date is prior to the third Payment Date after the Closing Date) is not satisfied on the related Determination Date, tomake payments in accordance with the Sequential DebtNote Redemption to theextent necessary to cause both Class C Coverage Tests to be met as of the relatedDetermination Date on a pro forma basis after giving effect to any payments madethrough this clause (IH);
to the payment of any Deferred Interest on the Class C Notes;(I)
to the payment of accrued and unpaid interest (excluding any(J)Deferred Interest, but including interest on Deferred Interest) on the Class DNotes;
if either of the Class D Coverage Tests is not satisfied on the (K)related Determination Date, to make payments in accordance with the Sequential Note Redemption to the extent necessary to cause both Class D Coverage Tests to be met as of the related Determination Date on a pro forma basis after giving effect to any payments made through this clause (K);
(K) to the payment of any Deferred Interest on the Class D Notes;(L)
(L) if either of the Class D Coverage Tests (except, in the case of the Interest Coverage Test, if such Payment Date is prior to the third Payment Date after the Closing Date) is not satisfied on the related Determination Date, to make payments in accordance with the Sequential Debt Redemption to the extent necessary to cause both Class D Coverage Tests to be met as of the related Determination Date on a pro forma basis after giving effect to any payments made through this clause (L);
to the payment of accrued and unpaid interest (excluding any(M)Deferred Interest, but including interest on Deferred Interest) on the Class ENotes;
(N) to the payment of any Deferred Interest on the Class E Notes;
(O) if the Class E Coverage Test is not satisfied on the related(N)Determination Date, to make payments in accordance with the SequentialDebtNote Redemption to the extent necessary to cause the Class E Coverage Testto be met as of the related Determination Date on a pro forma basis after givingeffect to any payments made through this clause (ON);
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to the payment of any Deferred Interest on the Class E Notes;(O)
to the payment of accrued and unpaid interest (excluding any(P)Deferred Interest, but including interest on Deferred Interest) on the Class FNotes;
to the payment of any Deferred Interest on the Class F Notes;(Q)
during the Reinvestment Period, if the Reinvestment Diversion (R)Test is not satisfied on the related Determination Date, an amount equal to the lesser of (i) 50% of the remaining Interest Proceeds after application of Interest Proceeds pursuant to (A) through (O) above and (ii) the amount necessary to cause the Reinvestment Diversion Test to be satisfied as of such Determination Date on a pro forma basis after giving effect to any payments made through this clause (P), either (1) to deposit into the Collection Account as Principal Proceeds to invest in Eligible Investments and/or to the purchase of additional Collateral Obligations or (2) only after the Non-Call Period, if so designated by the Investment Manager (with the written consent of the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder Condition is satisfied)), to make payments in accordance with the Sequential Note Redemption on such Payment Date;
(R) to the payment of the accrued and unpaid Subordinated(S)Management Fee and any accrued and unpaid Subordinated Management FeeInterest thereon to the Investment Manager, except to the extent that theInvestment Manager elects to treat the current Subordinated Management Fee asDeferred Subordinated Management Fees; provided that (1) if, with respect to thefirst Payment Date, the Ramp-Up Period has not ended, all amounts available fordistribution pursuant to this clause (R) shall be deposited into the CollectionAccount to be applied as Interest Proceeds on the next Payment Date and (2) if,with respect to any Payment Date following the end of the Ramp-Up Period uponwhich a Moody’s Ramp-Up Failure has occurred and is continuing, amountsavailable for distribution pursuant to this clause (R) will instead be used forapplication as Principal Proceeds pursuant to Section 11.1(a)(ii) on such PaymentDate in an amount sufficient to obtain, in connection with any actions takenpursuant to Section 7.17(c), Moody’s confirmation of the initial rating assignedby it on the Closing Date to any Class of the Rated DebtNotes;
(S) during the Reinvestment Period, if the Reinvestment Diversion Test is not satisfied on the related Determination Date, to the purchase of additional Collateral Obligations or for deposit to the Collection Account as Principal Proceeds for investment in Eligible Investments pending the purchase of additional Collateral Obligations at a later date in an amount equal to the lesser of (i) 50% of the remaining Interest Proceeds after application of Interest Proceeds pursuant to (A) through (R) above and (ii) the amount necessary to cause the
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Reinvestment Diversion Test to be satisfied as of such Determination Date on a pro forma basis after giving effect to any payments made through this clause (S);
the payment of (1) first, on a pro rata basis of the following(T)amounts based on the respective amounts due on such Payment Date: (a) anyaccrued and unpaid Deferred Subordinated Management Fee plus any accruedand unpaid Deferred Subordinated Management Fee Interest thereon to theInvestment Manager that has been deferred with respect to prior Payment Dates and which the Investment Manager elects to have paid on such Payment Date and(b) any accrued and unpaid Deferred Senior Management Fee that has beendeferred with respect to prior Payment Dates together with all accrued and unpaidDeferred Senior Management Fee Interest thereon which the Investment Managerelects to have paid on such Payment Date, (2) second, any AdministrativeExpenses not paid pursuant to clause (A)(2) above due to the limitationscontained therein (in the priority stated in clause (A)(2) above) and (3) third, prorata based on amounts due, any amounts due to any Hedge Counterparty underany Hedge Agreement not otherwise paid pursuant to clause (C) above;
to each Contributor, any Contribution Repayment Amount for such (U)Payment Date, pro rata based on the Contribution Repayment Amount payable on such Payment Date;
(U) to the Holders of the Subordinated Notes in an amount(V)necessary (taking into account all payments made to the Holders of theSubordinated Notes on prior Payment Dates) to cause the Incentive ManagementFee Threshold to be met;
(V) to the payment of the Incentive Management Fee to the(W)Investment Manager; and
(W) any remaining Interest Proceeds shall be paid to the Holders(X)of the Subordinated Notes.
On each Payment Date (other than a Post-Acceleration Payment Date or(ii)the Stated Maturity) and Redemption Date (other than a Refinancing or any PartialRedemption Date), Principal Proceeds that have been received on or before the relatedDetermination Date (or if such Determination Date is not a Business Day, the next succeeding Business Day) and that are transferred to the Payment Account shall beapplied in the following order of priority:
to pay, in accordance with Section 11.1(a)(i) above (1) first, the(A)amounts referred to in clauses (A) through (F), (2) then, to the extent the Class CNotes are the Controlling Class, the amounts referred to in clausesclause (G) and (H), (3) then, the amounts referred to in clause (IH), (4) then, to the extent theClass DC Notes are the Controlling Class, the amounts referred to in clauses (J) and (Kclause (I), (5) then, to the amounts referred to in Clause (L), (6) then, to the extent the Class ED Notes are the Controlling Class, the amounts referred to in
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clause (J), (6) then, the amounts referred to in clauses (M) and (N), (7) thenclause (K), (7) then, to the extent the Class D Notes are the Controlling Class, the amounts referred to in clause (L), (8) then, to the extent the Class E Notes are the Controlling Class, the amounts referred to in clause (M), (9) then, the amounts referred to in clause (N) and (10) then, to the extent the Class E Notes are the Controlling Class, the amounts referred to in clause (O) and, (811) then, to theextent the Class F Notes are the Controlling Class, the amounts referred to inclauses (P) and (Q),; but, in each case, (I) only to the extent not paid in fullthereunder, (II) subject to any applicable cap set forth therein, and (III) withrespect to any payment to cure a Coverage Test failure, to the extent necessary tocause each applicable Coverage Test to be satisfied on a pro forma basis aftergiving effect to such payments;
if the Rated Debt isNotes are to be redeemed or prepaidin full on(B)such Payment Date in connection with a Tax Event, a Special Redemption or anOptional Redemption, to the payment of the Redemption Price (withoutduplication of any payments received by any Class of Rated DebtNotes pursuantto Section 11.1(a)(i) above or under clause (A) of this Section 11.1(a)(ii)) inaccordance with the Sequential DebtNote Redemption;
during the Reinvestment Period, at the sole discretion of the(C)Investment Manager, to the Collection Account as Principal Proceeds to invest inEligible Investments and/or to the purchase of additional Collateral Obligations;
after the Reinvestment Period, to either (1) make payments in(D)accordance with the Sequential DebtNote Redemption after taking into accountpayments made pursuant to Section 11.1(a)(i) above and clauses (A) and (B) ofthis Section 11.1(a)(ii) or (2) at the election of the of the Investment Manager, inthe case of Principal Proceeds received with respect to any sold Credit RiskObligations and any Unscheduled Principal Payments only, be invested inadditional Collateral Obligations (subject to the requirements set forth in Section12.2(b));
to pay, in accordance with Section 11.1(a)(i) above, the amounts(E)referred to in clauses (RQ) and (TR)(1) of Section 11.1(a)(i) above, but only tothe extent not previously paid in full under such clause;
to pay, in accordance with Section 11.1(a)(i) above, the amounts(F)referred to in clauses (A) and (TR)(2) of Section 11.1(a)(i) above (without regardto the Administrative Expense Cap), but only to the extent not previously paid infull under such clauses and under clause (A) of this Section 11.1(a)(ii);
to pay, in accordance with Section 11.1(a)(i) above, the amounts(G)referred to in clauses (C) and (TR)(3) of Section 11.1(a)(i) above, but only to theextent not previously paid in full under such clauses and under clause (A) of thisSection 11.1(a)(ii);
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if the Subordinated Notes are to be redeemed on such Payment(H)Date in connection with an Optional Redemption of the Subordinated Notes, tofund a reasonable reserve for unpaid Administrative Expenses (as determined bythe Investment Manager in consultation with the Initial Majority SubordinatedNoteholder (so long as the Initial Majority Subordinated Noteholder Condition issatisfied) and with approval from the Collateral Agent in itsTrustee in the Investment Manager’s and Trustee’s respective sole discretion);
to each Contributor, any Contribution Repayment Amount for such (I)Payment Date, pro rata based on the Contribution Repayment Amount payable on such Payment Date;
(I) to the Holders of the Subordinated Notes in an amount(J)necessary (taking into account all payments made to the Holders of theSubordinated Notes on prior Payment Dates and amounts paid on such PaymentDate pursuant to clause (UV) of Section 11.1(a)(i) above) to cause the IncentiveManagement Fee Threshold to be met;
(J) to the payment of the Incentive Management Fee to the(K)Investment Manager; and
(K) any remaining Principal Proceeds shall be paid to the Holders(L)of the Subordinated Notes.
On any Partial Redemption Date, Refinancing Proceeds, Partial (iii)Redemption Interest Proceeds and/or any other available proceeds from Contributions, an additional issuance of Notes or any other amounts permitted pursuant to this Indenture will be distributed (after the application of Interest Proceeds pursuant to Section 11.1(a)(i) if such date is otherwise a Payment Date) in the following order of priority:
to pay the Redemption Price of each Class of Notes being (A)redeemed in accordance with the Sequential Note Redemption;
to pay Administrative Expenses related to the Refinancing; and(B)
any remaining amounts, to the Collection Account as Principal (C)Proceeds or Interest Proceeds, at the discretion of the Investment Manager in consultation with the Initial Majority Subordinated Noteholder (so long as the Initial Majority Subordinated Noteholder Condition is satisfied).
(iii) On each Post-Acceleration Payment Date or on the Stated Maturity,(iv)all Interest Proceeds and all Principal Proceeds on deposit in the Collection Account, tothe extent received on or before the related Determination Date (or if such DeterminationDate is not a Business Day, the next succeeding Business Day) and that are transferredinto the Payment Account, and, in the case of any Hedge Agreements, payments receivedon or before such Payment Date, and all Principal Proceeds on deposit in the Collection Account that are received on or before the related Determination Date and that are
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transferred to the Payment Account shall be applied, except for any Principal Proceedsthat shall be used to settle binding commitments (entered into prior to the DeterminationDate) for the purchase of Collateral Obligations, in the following order of priority:
to pay all amounts under clauses (A) through (C) of Section (A)11.1(a)(i) in the priority and subject to the limitations stated therein (except that the Administrative Expense Cap shall not apply if the Collateral Agent has begun liquidating the Assets in accordance with Section 5.5, if a liquidation of Assets has commenced, no such limitations shall apply);
to the payment of accrued and unpaid interest (including any (B)defaulted interest) on the Class A-1 Notes, the Class A-2 Notes and the Class A Loans, pro rata, allocated in proportion to the respective amounts of accrued and unpaid interest, until such amounts have been paid in full;
(C) to the payment of principal on the Class A-1 Notes, the Class A-2 Notes and the Class A Loans, pro rata, based on their respective Aggregate Outstanding Amounts, until such amounts have been paid in full;(D) to the payment pro rata based on amounts due of accrued and unpaid interest on the Class X Notes and the Class A Notes (including any defaulted interest) onuntil such amounts have been paid in full;
to the payment of principal of the Class B-1X Notes and the Class(C)B-2A Notes, pro rata, allocated in proportion to the respective amounts pro rata based upon the Aggregate Outstanding Amount of each such Class until the Class X Notes and the Class A Notes have been paid in full;
to the payment of accrued and unpaid interest, on the Class B (D)Notes (including any defaulted interest) until such amounts have been paid in full;
to the payment of principal onof the Class B-1 Notes and the Class (E)B-2 Notes, pro rata, based on their respective Aggregate Outstanding Amounts Notes, until such amounts haveamount has been paid in full;
to the payment of first accrued and unpaid interest (excluding any (F)Deferred Interest, but including interest on Deferred Interest) and then anyDeferred Interest on the Class C-1 Notes and the Class C-2 Notes, pro rata, allocated in proportion to the respective amounts of accrued and unpaid interest, Notes until such amounts have been paid in full;
to the payment of principal of the Class C-1 Notes and the Class (G)C-2 Notes, pro rata, based on their respective Aggregate Outstanding Amounts, Notes until such amounts haveamount has been paid in full;
to the payment of first accrued and unpaid interest (excluding any (H)Deferred Interest, but including interest on Deferred Interest) and then anyDeferred Interest on the Class D Notes until such amounts have been paid in full;
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to the payment of principal of the Class D Notes until such amount(I)has been paid in full;
to the payment of first accrued and unpaid interest (excluding any (J)Deferred Interest, but including interest on Deferred Interest) and then anyDeferred Interest on the Class E Notes until such amounts have been paid in full;
to the payment of principal of the Class E Notes until such amount(K)has been paid in full;
to the payment of first accrued and unpaid interest (excluding any (L)Deferred Interest, but including interest on Deferred Interest) and then anyDeferred Interest on the Class F Notes until such amounts have been paid in full;
to the payment of principal of the Class F Notes until such amount(M)has been paid in full;
to the payment of any amounts owing to the Investment Manager(N)of the amounts owing on such Payment Date under clauses (RQ) and (T)(1R) ofSection 11.1(a)(i);
to the payment of (1) first, any Administrative Expenses not paid(O)pursuant to clause (A) above due to the Administrative Expense Cap (in thepriority stated therein) and (2) second, pro rata based on amounts due, anyamounts due to any Hedge Counterparty under any Hedge Agreement pursuant toa termination (or partial termination) of such Hedge Agreement not otherwisepaid pursuant to clause (A) above;
to each Contributor, any Contribution Repayment Amount for such (P)Payment Date, pro rata based on the Contribution Repayment Amount payable on such Payment Date;
(P) to the Holders of the Subordinated Notes in an amount(Q)necessary (taking into account all payments made to the holders of theSubordinated Notes on prior Payment Dates) to cause the Incentive ManagementFee Threshold to be met;
(Q) to the payment of the Incentive Management Fee to the(R)Investment Manager; and
(R) any remaining Interest Proceeds and Principal Proceeds to the(S)Holders of the Subordinated Notes.
On the Stated Maturity of the DebtNotes, and after payment of all amounts(b)specified in Section 11.1(a)(iii), the Collateral AgentTrustee shall pay the net proceeds from theliquidation of the Assets and all available Cash, after the payment of (or establishment of areserve for) any remaining fees, expenses, including the Collateral Agent’s and Trustee’s fees
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and other Administrative Expenses, and interest and principal on the Rated DebtNotes, to theHolders of the Subordinated Notes in final payment of such Subordinated Notes.
If on any Payment Date the amount available in the Payment Account is(c)insufficient to make the full amount of the disbursements required by the Distribution Report, theCollateral AgentTrustee shall make the disbursements called for in the order and according to thepriority set forth under Section 11.1(a) above to the extent funds are available therefor.
In connection with the application of funds to pay Administrative(d)Expenses of the Issuer or the Co-Issuer, as the case may be, in accordance with SectionSections 11.1(a)(i), (ii) and, (iii) and (iv), the Collateral AgentTrustee shall remit such funds, to the extentavailable, as directed and designated in an Issuer Order (which may be in the form of standinginstructions, and standing instructions are hereby provided to pay Administrative Expenses identified in the Distribution Report) delivered to the Collateral AgentTrustee no later than theBusiness Day prior to each Payment Date.
In the event that the Hedge Counterparty defaults in the payment of its(e)obligations to the Issuer under any Hedge Agreement on the date on which any payment is duethereunder, the Investment Manager shall make a demand on such Hedge Counterparty inaccordance with Section 16.1(f). The Collateral AgentTrustee shall give notice as soon asreasonably practicable to the Holders of DebtNotes, the Investment Manager and each RatingAgency if such Hedge Counterparty continues to fail to perform its obligations for two (2) Business Days following a demand made by the Collateral AgentTrustee on such HedgeCounterparty, and shall take such action with respect to such continuing failure as may bedirected to be taken pursuant to Section 5.13.
The Investment Manager may, in its sole discretion, elect to defer payment(f)of all or a portion of the Senior Management Fee or the Subordinated Management Fee on anyPayment Date by providing notice to the Trustee, the Collateral Agent, the CollateralAdministrator and the Issuer of such election on or before the Determination Date precedingsuch Payment Date. On any Payment Date following a Payment Date on which the InvestmentManager has elected to defer all or a portion of the Senior Management Fee or the SubordinatedManagement Fee, the Investment Manager may elect to receive all or a portion of the applicableDeferred Management Fee subject to the terms of the Priority of Payments that has otherwise notbeen paid to the Investment Manager by providing notice to the Issuer, the Collateral Agent, theCollateral Administrator and the Trustee of such election on or before the related DeterminationDate, which notice shall specify the amount of such Deferred Management Fee that theInvestment Manager elects to receive on such Payment Date.
The Investment Manager may, in its sole discretion, with prior written (g)notice of at least two Business Days to the Trustee, elect to defer or waive payment of, or distribution in respect of, any or all of the Senior Management Fee, the Subordinated Management Fee and/or the Incentive Management Fee payable or distributable in accordance with the Priority of Payments on any Payment Date (the “Redirected Fee Interest”). An amount equal to the Redirected Fee Interest for any Payment Date will be, at the sole discretion of the Investment Manager, either (x) applied to a Permitted Use or (y) distributed to holders of Subordinated Notes designated by the Investment Manager, as applicable, as additional return on
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their investment at the same priority as the applicable waived fee or interest and subject to the availability of funds therefor at such priority level in accordance with the Priority of Payments, and no other holder of Subordinated Notes will realize any benefit from such waiver or deferral.
The Issuer shall provide notice to each Rating Agency if a Holder elects (h)(in its sole discretion by written notice to the Issuer, the Trustee, the Paying Agent and the Investment Manager) to receive lesser principal amount than owed to such Holder in connection with a Sequential Note Redemption.
Contributions. At any time during or after the Reinvestment Section 11.2Period, any Holder of Subordinated Notes (including the Income Note Issuer) (each such person, a “Contributor”) may, subject to the written consent of a Majority of the Subordinated Notes, provide a Contribution Notice to the Issuer (with a copy to the Investment Manager) and the Trustee and make a subsequent contribution of cash to the Issuer (each, a “Contribution”). Except for a Cure Contribution, the Investment Manager, on behalf of the Issuer, may accept or reject any Contribution in its sole discretion and shall notify the Trustee of any such acceptance (as long as a Majority of the Subordinated Notes has consented thereto). With respect to a Cure Contribution, the Trustee (as long as the Majority of the Subordinated Notes has consented thereto) shall accept such Contribution on behalf of the Issuer and none of the Issuer, the Investment Manager or any other Person shall have any right to reject such Contribution. Each accepted Contribution shall be received into the Permitted Use Account and applied by the Investment Manager on behalf of the Issuer to a Permitted Use, as directed by the Contributor at the time such Contribution is made (or, if no such direction is given, at the reasonable discretion of the Investment Manager). Contributions shall be repaid to the Contributor on a specified Payment Date and subsequent Payment Dates until paid in full together with a specified rate of return, at such rate of return may be agreed to between such Contributor and at least a Majority of the Subordinated Notes (such applicable amount inclusive of the related Contribution, the “Contribution Repayment Amount”). The Trustee shall, within one (1) Business Day of receipt of notice of any Contribution, notify (substantially in the form of Exhibit E) the remaining Holders of the Subordinated Notes of its receipt thereof, and shall extend, on behalf of the Issuer, to the other Holders of Subordinated Notes the opportunity to participate in the related Contribution in proportion to their then current ownership of Subordinated Notes. Any existing Holder of Subordinated Notes that has not, within three (3) Business Days after delivery of such notice of a Contribution from the Trustee, elected to participate in such Contribution by providing a notice thereof (substantially in the form of Exhibit F) to the Issuer and the Trustee (which shall forward such notice to the Contributors) shall be deemed to have irrevocably declined to participate in such Contribution. Any income earned on amounts deposited in the Permitted Use Account shall be deposited in the Interest Collection Subaccount as Interest Proceeds. In connection with any transfer of any Subordinated Notes (or beneficial interest therein) held by a Contributor, such Contributor shall be required to transfer, and will be deemed to have transferred, its interest in any unpaid Contribution Repayment Amount (and the related Contribution) in an amount that is proportional to the amount of Subordinated Notes held by such Contributor that are subject to such transfer. From and after the date of such transfer, the transferee will be deemed to be a Contributor with respect to the applicable portion of the related Contribution. Notwithstanding the foregoing, the Trustee shall be entitled to assume, and be fully protected in assuming, that no such transfer of an interest in a Contribution Repayment
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Amount (including the related Contribution) has occurred until the certificate specified in Section 2.6(f)(viii) is received by the Trustee.
For the avoidance of doubt, Holders shall not have any voting rights with respect to any Contribution Repayment Amount owed, and Contributions shall not increase the voting rights of the Notes held by any Holder.
In addition, the proceeds of an additional issuance of Subordinated Notes and/or Junior Mezzanine Notes and any amounts in respect of any Redirected Fee Interest may be deposited in the Permitted Use Account for application to a Permitted Use, at the direction of the Investment Manager.
ARTICLE XII
SALE OF COLLATERAL OBLIGATIONS; PURCHASE OF ADDITIONALCOLLATERAL OBLIGATIONS
Sales of Collateral Obligations. Subject to the satisfaction of theSection 12.1conditions specified in Section 12.3 and provided that no Event of Default has occurred and iscontinuing (except for sales pursuant to Section 12.1(a), (b), (c) and (d), which are permittedunless liquidation of the Assets has begun or the Collateral AgentTrustee has exercised anyremedies of a Secured Party pursuant to Section 5.4(a)(iv) at the direction of the ControllingClass), the Investment Manager on behalf of the Issuer may in writing direct the Collateral AgentTrustee to sell and the Collateral AgentTrustee (on behalf of the Issuer) shall sell in themanner directed by the Investment Manager any Collateral Obligation or Equity Security if, ascertified by the Investment Manager, to the best of its knowledge, such sale meets therequirements of any one of paragraphs (a) through (g) of this Section 12.1. For purposes of thisSection 12.1, the Sale Proceeds of a Collateral Obligation sold by the Issuer shall include anyPrincipal Financed Accrued Interest received in respect of such sale.
Credit Risk Obligations. The Investment Manager may direct the(a)Collateral AgentTrustee to sell any Credit Risk Obligation at any time during or after theReinvestment Period without restriction.
Credit Improved Obligations. The Investment Manager may direct the(b)Collateral AgentTrustee to sell any Credit Improved Obligation at any time during or after theReinvestment Period without restriction.
Defaulted Obligations. The Investment Manager may direct the Collateral (c)AgentTrustee to sell any Defaulted Obligation at any time during or after the ReinvestmentPeriod without restriction.
Equity Securities. The Investment Manager may direct the Collateral (d)AgentTrustee to sell any Equity Security at any time during or after the Reinvestment Periodwithout restriction; provided that the Investment Manager shall use commercially reasonableefforts to dispose of any Equity Security within three (3) years of receipt of such Equity Securityby the Issuer unless such sale is prohibited by applicable law or contractual restrictions.
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Optional Redemption or Redemption Following a Tax Event. After the(e)Issuer has notified the Collateral AgentTrustee of an Optional Redemption of the RatedDebtNotes in whole in connection with a Redemption by Liquidation, an Optional Redemptionof the Subordinated Notes following a Redemption by Liquidation or a redemption of the RatedDebtNotes in connection with a Tax Event in accordance with Section 9.4, the InvestmentManager shall direct the Collateral AgentTrustee to sell (which sale may be through participationor other arrangement) all or a portion of the Collateral Obligations if the requirements of Article IX (including the certification requirements of Section 9.2(b)) are satisfied. If any such sale ismade through participation, the Issuer shall use reasonable efforts to cause such participations tobe converted to assignments within 90 days of the sale.
Discretionary Sales. The Investment Manager may direct the Collateral (f)AgentTrustee to sell any Collateral Obligation at any time other than a Restricted Trading Periodif (i) after giving effect to such sale, the Aggregate Principal Balance of all CollateralObligations sold pursuant to this Section 12.1(f) during the preceding period of twelve calendarmonths (or, for the first twelve calendar months after the end of the Ramp-Up Period, during theperiod commencing on the first Business Day following the end of the Ramp-Up Period) is notgreater than 2530% of the Collateral Principal Amount as of the beginning of such twelvecalendar month period; provided that for the purpose of determining the percentage of CollateralObligations sold during any such period, the amount of any Collateral Obligations sold shall bereduced to the extent of any purchases of Collateral Obligations of the same obligor (which arepari passu or senior to such sold Collateral Obligation) occurring within twenty (20) BusinessDays of such sale (determined based upon the date of any relevant trade confirmation orcommitment letter) so long as any such Collateral Obligation was sold with the intention ofpurchasing a Collateral Obligation of the same obligor (which would be pari passu or senior tosuch sold Collateral Obligation), and (ii) either:
at any time (1) the Sale Proceeds from such sale are at least equal(A)to the Investment Criteria Adjusted Balance of such Collateral Obligation, or (2)after giving effect to such sale, the Aggregate Principal Balance of the CollateralObligations (excluding the Collateral Obligation being sold) and EligibleInvestments constituting Principal Proceeds (including, without duplication, theanticipated net proceeds of such proposed sale) is maintained or increased or (3) after giving effect to such sale, the Aggregate Principal Balance of the Collateral Obligations (excluding the Collateral Obligation being sold) and Eligible Investments constituting Principal Proceeds (including, without duplication, the anticipated net proceeds of such sale) shall be greater than or equal to theReinvestment Target Par Balance; or
during the Reinvestment Period, the Investment Manager(B)reasonably believes prior to such sale that it will be able to enter into bindingcommitments to reinvest all or a portion of the proceeds of such sale, incompliance with the Investment Criteria, in one or more additional CollateralObligations within ninety (90) days of such sale.
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Mandatory Sales. The Investment Manager shall use commercially(g)reasonable efforts to sell each Equity Security, Collateral Obligation and any other security heldby the Issuer that constitutes Margin Stock not later than 45 days after the later of (x) the date ofthe Issuer’s acquisition thereof and (y) the date such Equity Security, Collateral Obligation orother security held by the Issuer became Margin Stock.
Notwithstanding anything contained herein to the contrary, the Issuer may(h)cause any assets (or the Issuer’s interest therein) to be transferred to an Issuer Subsidiary inexchange for an interest in such Issuer Subsidiary in accordance with Section 7.16(i) hereof.
After the Investment Manager has notified the Issuer and the Collateral (i)AgentTrustee of a Clean Up Call Redemption in accordance with Section 9.8 hereof, theInvestment Manager may at any time effect the sale of any Collateral Obligation without regardto the limitations in this Section 12.1 by directing the Collateral AgentTrustee to effect such sale;provided that the Sale Proceeds therefrom are used for the purposes specified in Section 9.8hereof (and applied pursuant to the Priority of Payments).
In the event that the Investment Manager and the Issuer receive an (j)Opinion of Counsel experienced in such matters that the Issuer’s ownership of any specific Collateral Obligations or Eligible Investments would cause the Issuer to be unable to comply with the loan securitization exemption from the definition of “covered fund” under the Volcker Rule, then the Investment Manager, on behalf of the Issuer, shall be required to take commercially reasonable efforts to sell such Collateral Obligations or Eligible Investments and shall not purchase any additional Collateral Obligations or Eligible Investments of the type identified in such Opinion of Counsel.[Reserved.]
Stated Maturity. Notwithstanding the restrictions of Section 12.1(a), the(k)CollateralInvestment Manager shall, no later than the Determination Date for the StatedMaturity, on behalf of the Issuer, direct the Collateral AgentTrustee to sell (and the Collateral AgentTrustee shall sell in the manner specified) for settlement in immediately available fundsany Collateral Obligations scheduled to mature after the Stated Maturity of the Notes and causethe liquidation of all assets held at each Issuer Subsidiary and distribution of any proceedsthereof to the Issuer.
Purchase of Additional Collateral Obligations. On any date duringSection 12.2the Reinvestment Period (and after the Reinvestment Period with respect to purchases madepursuant to Section 12.2(b)) the Investment Manager, on behalf of the Issuer, may, but shall notbe required to, direct the Collateral AgentTrustee to invest Principal Proceeds (and accruedinterest received with respect to any Collateral Obligation to the extent used to pay for accruedinterest on additional Collateral Obligations) in additional Collateral Obligations, and theCollateral AgentTrustee shall invest such proceeds, if, as certified by the Investment Manager,each of the conditions specified in this Section 12.2 and Section 12.3 are met.
Investment Criteria. No Collateral Obligation may be purchased during (a)the Reinvestment Period unless each of the following conditions are satisfied as of the date theInvestment Manager commits on behalf of the Issuer to make such purchase after giving effect to
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such purchase and all other sales or purchases previously or simultaneously committed to butwhich have not settled; provided that the conditions set forth in clauses (ii), (iii) and (iv) belowneed only be satisfied with respect to purchases of Collateral Obligations occurring after the endof the Ramp-Up Period; provided, further that any purchase of Collateral Obligations that is in respect of Unscheduled Principal Payments or Principal Proceeds received with respect to the sale of Credit Risk Obligations that, in each case, the Investment Manager reasonably expects will be received after the Reinvestment Period, shall be required to satisfy the conditions set forth in Section 12.2(b)(ii) instead of the Investment Criteria:
such obligation is a Collateral Obligation;(i)
each Coverage Test will be satisfied, or if not satisfied, such Coverage(ii)Test will be maintained or improved;
(A) in the case of an additional Collateral ObligationsObligation(iii)purchased with the proceeds from the sale of an Asset pursuant to Section 12.1(a) or Section 12.1(c), the Investment Manager shall use commercially reasonable efforts to ensure that (within thirty (30) days of the sale of an Asset pursuant to Section 12.1(a) or ninety (90) days of the sale of an Asset pursuant to Section 12.1(c)) after giving effect to such purchase, eithera Credit Risk Obligation or a Defaulted Obligation, (1) theAggregate Principal Balance of all additional Collateral Obligations purchased with theproceeds from such sale shall at least equal the Sale Proceeds from such sale, (2) theAggregate Principal Balance of the additional Collateral Obligations purchased with the proceeds of such sale shall be greater or equal than the Aggregate Principal Balance of the Collateral Obligations sold, orCollateral Obligations and Eligible Investments constituting Principal Proceeds, after giving effect to such reinvestment is maintained or increased, (3) the Aggregate Principal Balance of the Collateral Obligations (excluding Collateral Obligations being sold but including, without duplication the Collateral Obligations being purchased and the anticipated cash proceeds, if any, of such sale that are not applied to the purchase of such additional Collateral Obligations) and EligibleInvestments constituting Principal Proceeds, after giving effect to such reinvestment,shall be greater than or equal to the Reinvestment Target Par Balance, or (4) the aggregate Investment Criteria Adjusted Balance of all additional Collateral Obligations is at least equal to the aggregate Investment Criteria Adjusted Balance of the Collateral Obligation(s) that gave rise to such Principal Proceeds and (B) in the case of any otherpurchase of additional Collateral Obligations, the Investment Manager shall use commercially reasonable efforts to ensure that (within ninety (90) days of the sale of such Asset) after giving effect to such purchase, either (1) the Aggregate Principal Balance ofthe additional Collateral Obligations purchased with the proceeds of such sale shall be greater or equal than the Aggregate Principal Balance of the Collateral Obligations soldCollateral Obligations and Eligible Investments constituting Principal Proceeds, after giving effect to such reinvestment, is maintained or increased, (2) the AggregatePrincipal Balance of the Collateral Obligations (excluding Collateral Obligations being sold but including, without duplication the Collateral Obligations being purchased and the anticipated cash proceeds, if any, of such sale that are not applied to the purchase of such additional Collateral Obligations) and Eligible Investments constituting PrincipalProceeds, after giving effect to such reinvestment, shall be greater than or equal to the
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Reinvestment Target Par Balance or (3) the aggregate Investment Criteria AdjustedBalance of the replacement Collateral Obligations is at least equal to the aggregateInvestment Criteria Adjusted Balance of the Collateral Obligation(s) that gave rise tosuch Principal Proceeds; and
either (A) each requirement or test, as the case may be, of the(iv)Concentration Limitations and the Portfolio Quality Test shall be satisfied or (B) if anysuch requirement or test was not satisfied immediately prior to such reinvestment, suchrequirement or test shall be maintained or improved after giving effect to thereinvestment (in such case, compliance with each Concentration Limitation and PortfolioQuality Test (it being agreed, for the avoidance of doubt, that each Concentration Limitation and Portfolio Quality Test), will be measured before receipt of the proceedsfrom any scheduled or unscheduled principal payments on, or sales or dispositions of,any Collateral Obligations and after the reinvestment of such proceeds).
Notwithstanding the foregoing, clause (ii) above and the Portfolio Quality Tests in clause (iv) above need not be satisfied with respect to any Defaulted Obligation acquired in a Bankruptcy Exchange.
Not later than the Business Day immediately preceding the end of the Reinvestment Period, the Investment Manager shall deliver to the Collateral Agent a list of Collateral Obligations purchased by the Issuer with respect to which purchases the trade date has occurred but the settlement date has not yet occurred and shall certify to the Collateral Agent that sufficient Principal Proceeds are available (including for this purpose, cash on deposit in the Principal Collection Subaccount as well as any Principal Proceeds that will be received by the Issuer from the sale of Collateral Obligations for which the trade date has already occurred but the settlement date has not yet occurred) to effect the settlement of such Collateral Obligations.At any time during or after the Reinvestment Period, the Investment Manager may direct the Issuer (or the Trustee on its behalf) to enter into a Bankruptcy Exchange or apply amounts on deposit in the Permitted Use Account (as directed by the related Contributor or, if no direction is given by the Contributor, by the Investment Manager at its reasonable discretion) to one or more Permitted Uses.
With respect to the purchase of any Collateral Obligation, the settlement date for which the Investment Manager reasonably expects will occur after the end of the Reinvestment Period, such Collateral Obligation may be purchased with (x) scheduled distributions of Principal Proceeds that the Investment Manager reasonably expects will be received prior to the end of the Reinvestment Period and (y) Sale Proceeds received by the Issuer after the end of the Reinvestment Period in settlement of a sale or disposition that occurred (on a trade date basis) prior to the end of the Reinvestment Period. In each case, the related Collateral Obligation will be treated as having been purchased by the Issuer prior to the end of the Reinvestment Period for purposes of the Investment Criteria.
Investment after the Reinvestment Period. After the Reinvestment Period,(b)(x) Principal Proceeds other than those referred to in the following clause (y) may not bereinvested in additional Collateral Obligations and (y) Principal Proceeds received with respectto any sold Credit Risk Obligations and any Unscheduled Principal Payments may be reinvested
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in additional Collateral Obligations so long as either the Weighted Average Life Test was satisfied as of the end of the Reinvestment Period or such trade date for reinvestment occurs on or prior to the end of the second year following the end of the Reinvestment Period and inaccordance with the following requirements:
After the Reinvestment Period, provided that nounless an Event of Default(i)has occurred and is continuing, the Investment Manager may, but shall not be required to,invest Principal Proceeds that were received with respect to sales of Credit RiskObligations at any time prior to the later of (1) forty-five (45) days after the receipt ofsuch Principal Proceeds and (2) the last day of the Collection Period in which suchPrincipal Proceeds were received; provided, that the Investment Manager may notreinvest such Principal Proceeds unless after giving effect to any such reinvestment (A)the Portfolio Quality Tests (other thanMinimum Floating Spread Test, the MaximumMoody’s Rating Factor Test) and the Moody’s Minimum Weighted Average Recovery Rate Test shall be satisfied or, if not satisfied, shall be maintained or improved as compared to such failing test level prior to the sale of the related Credit Risk Obligation,(B) the Par Value Ratio Tests and the Maximum Moody’s Rating Factor Test shall besatisfied, (C) the Restricted Trading Period is not then in effect, (D) the additionalCollateral Obligations purchased shall have (1) the same or higher Moody’s Default Probability Ratings, and (2) the same or earlier maturity date (in the case of this clause (2) without giving effect to any Trading Plan), in each case, than the CollateralObligation that gave rise to such Principal Proceeds that were reinvested, (E) either (1)the Aggregate Principal Balance(a) the aggregate principal balance of all additionalCollateral Obligations purchased with the proceeds from the sale of such Credit RiskObligations shall at least equal the related Sale Proceeds or (b) the principal balance of the replacement Collateral Obligation is at least equal to the principal balance of the Collateral Obligation that gave rise to such Principal Proceeds, (2) the aggregateInvestment Criteria Adjusted Balance of the reinvestmentadditional Collateral Obligations purchased with the proceeds from the sale of such Credit Risk Obligations isat least equal to the aggregate Investment Criteria Adjusted Balance of the sold CollateralCredit Risk Obligation orthat was sold, (3) the Aggregate Principal Balanceaggregate principal balance of the Collateral Obligations and EligibleInvestments constituting Principal Proceeds, after giving effect to such reinvestment,willis maintained or increased or (4) the aggregate principal balance of the Collateral Obligations and Eligible Investments constituting Principal Proceeds, after giving effect to such reinvestment, shall be greater than or equal to the Reinvestment Target ParBalance and, (F) the Concentration Limitations shall be satisfied or, if not satisfied,maintained or improved and (G) the additional Collateral Obligations purchased shall have the same or shorter Average Life (determined on a weighted average basis) than the Collateral Obligations that gave rise to such Principal Proceeds that were reinvested.
After the Reinvestment Period, provided that nounless an Event of Default(ii)has occurred and is continuing, the Investment Manager may, but shall not be required to,invest Principal Proceeds that were received with respect to Unscheduled PrincipalPayments at any time prior to the later of (1) forty-five (45) days after the receipt of suchPrincipal Proceeds and (2) the last day of the Collection Period in which such PrincipalProceeds were received; provided, that the Investment Manager may not reinvest such
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Principal Proceeds unless after giving effect to any such reinvestment (A) the Portfolio Quality Tests (other thanMinimum Floating Spread Test, the Maximum Moody’s RatingFactor Test) and the Moody’s Minimum Weighted Average Recovery Rate Test shall besatisfied or, if not satisfied, shall be maintained or improved as compared to such failing test level prior to the receipt of the Unscheduled Principal Payments, (B) the Par ValueRatio Tests and the Maximum Moody’s Rating Factor Test shall be satisfied, (C) theRestricted Trading Period is not then in effect, (D) the additional Collateral Obligationspurchased shall have (1) the same or higher Moody’s Default Probability Ratings, and (2) the same or earlier maturity date (in the case of this clause (2) without giving effect to any Trading Plan), in each case, than the Collateral Obligation that gave rise to suchPrincipal Proceeds that were reinvested, (E) either (1) the principal balance of thereplacement Collateral Obligation is at least equal to the principal balance of theCollateral Obligation that gave rise to such Principal Proceeds, (2) the aggregateInvestment Criteria Adjusted Balance of the reinvestmentadditional Collateral Obligations purchased with the proceeds of such Unscheduled Principal Payments is atleast equal to the aggregate Investment Criteria Adjusted Balance of the prepaidCollateral Obligation or, (3) the Aggregate Principal Balanceaggregate principal balanceof the Collateral Obligations and Eligible Investments constituting Principal Proceeds,after giving effect to such reinvestment, willis maintained or increased or (4) the aggregate principal balance of the Collateral Obligations and Eligible Investments constituting Principal Proceeds, after giving effect to such reinvestment, shall be greaterthan or equal to the Reinvestment Target Par Balance and, (F) the ConcentrationLimitations shall be satisfied or, if not satisfied, maintained or improved and (G) the additional Collateral Obligations purchased shall have the same or shorter Average Life (determined on a weighted average basis) than the Collateral Obligations that gave rise to such Principal Proceeds that were reinvested.
Investment in Eligible Investments. Cash on deposit in any Account may(c)be invested at any time in Eligible Investments in accordance with Article X.
Trading Plan Period. For purposes of calculating compliance with the(d)Investment Criteria, at the election of the Investment Manager in its sole discretion, anyproposed investment (whether a single Collateral Obligation or a group of Collateral Obligationsidentified by the Investment Manager to the Trustee and the Collateral AgentAdministrator assuch at the time when compliance with the Investment Criteria is required to be calculated (a“Trading Plan”)) may be evaluated after giving effect to all sales and reinvestments proposed tobe entered into within the fiveten (10) Business Days following the date of determination of suchcompliance (such period, the “Trading Plan Period”); provided that (i) no Trading Plan mayresult in the purchase of Collateral Obligations having an Aggregate Principal Balance thatexceeds 57.5% of the Collateral PrincipalAggregate Ramp-Up Par Amount as of the first day ofthe Trading Plan Period, (ii) no Trading Plan Period may include a Determination Date, (iii) nomore than one Trading Plan may be in effect at any time during a Trading Plan Period, (iv) theInvestment Manager reasonably believes that each Trading Plan will satisfy the InvestmentCriteria and the requirements of Section 12.2(e), as applicable, and (v) if the Investment Criteriaor the requirements of Section 12.2(e), as applicable, are not satisfied with respect to anyTrading Plan, notice will be provided to each Rating Agency by the Investment Manager and the Investment Manager may not execute further Trading Plans until the Global Rating Agency
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Condition has been satisfied with respect to a Trading Plan (and, following satisfaction of such Global Rating Agency Condition, any number of additional Trading Plans may be executed); provided that, for the purpose of satisfying the maturity requirements set forth in Section 12.2(b)(i)(D)(2) and Section 12.2(b)(ii)(D)(2), compliance with such maturity requirements will be determined without giving effect to any Trading Plan. Upon entry into a Trading Plan, the Investment Manager shall provide written notice to the Trustee, and the Trustee shall post such notice to the Trustee’s website..
Restrictions on Amendments to Collateral Obligations. During the (e)Reinvestment Period, theThe Issuer shall not consent, and shall not allow the InvestmentManager to consent, to any amendment, waiver or other modification to any CollateralObligation that would extend the maturity thereof if, after giving effect to such amendment, waiver or other modification, the maturity of suchits Collateral Obligation is extended beyond the Stated Maturity of the Rated Debt. After the Reinvestment Period, the Issuer shall vote in favor of an amendment, waiver or other modification to any Collateral Obligation that would extend the maturity thereof if, after giving effect to such amendment, waiver or other modification (and, if applicable, any other transaction comprising a Trading Plan), (a) either (i) the Weighted Average Life Test is satisfied or, if the Weighted Average Life Test is not satisfied, the Weighted Average Life Test willMaturity (a “Maturity Amendment”) unless, as determined by the Investment Manager, after giving effect thereto (1) the Weighted Average Life Test would be satisfied, or if not satisfied, shall be maintained or improved after giving effect to such amendment, waiver or other modification or (ii) only to the extent such amendment, waiver or other modification does not extend the maturity thereof more than two years from the maturity in effect prior to such amendment, waiver or other modification, in the reasonable judgment of the Investment Manager, not voting in favor of such amendment, waiver or other modification will have an adverse effect on the Issuer, the Debt or the Holders of the Debt (such extended Collateral Obligation, a “Specified Extended Collateral Obligation”) and (b) the maturity ofand (2) such Collateral Obligation is not extendedshall not have a Collateral Obligation Maturity beyond the earliest Stated Maturity applicable to any Class of the Rated Debt. Rated Notes; provided that clause (1) shall not apply if (i) such Maturity Amendment is a Credit Amendment and (ii) following such Maturity Amendment, the Aggregate Principal Balance of all Collateral Obligations that have been subject to Credit Amendments since the Amendment Date shall not exceed 20% of the Aggregate Ramp-Up Par Amount; provided, further, that the Issuer (or the Investment Manager on behalf of the Issuer) may vote in favor of a Maturity Amendment without regard to clauses (1) and (2) so long as the Investment Manager intends to sell such Collateral Obligation within thirty (30) days after the effective date of such Maturity Amendment and reasonably believes that any such sale will be completed prior to the end of such 30-day period (and should such sale not be completed prior to the end of such 30-day period, the Issuer (or the Investment Manager on behalf of the Issuer) shall complete such sale as soon as reasonably practicable thereafter).
For the avoidance of doubt, a waiver, modification, amendment or variance that would extend the stated maturity of the credit facility of which a Collateral Obligation is part, but would not extend the Collateral Obligation Maturity of the Collateral Obligation held by the Issuer, does not constitute a Maturity Amendment.
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It shall not be a violation of the restrictions of this Section 12.2(e) if any CollateralObligation is amended in violation of clauses (a) or (b)the requirements above so long as theIssuer (or the Investment Manager on behalf of the Issuer) has either (i) refused to consent tosuch amendment or (ii) solely in the case of clause (b) above, so long as (x) after giving effect to any such amendment, waiver or other modification, not more than 2.5% of the Collateral Principal Amount consists of Collateral Obligations in violation of clause (b) above, (y) the Moody’s Rating of such Collateral Obligation is “B3” or lower at the time the Issuer (or the Investment Manager on behalf of the Issuer) consented to such extension and (z) the maturity of any such Collateral Obligation is not extended more than two years beyond the Stated Maturity of the Rated Debt, provided its consent in connection with the restructuring of such Collateral Obligation as a result of an actual or imminent bankruptcy or insolvency of the related Obligor.
Conditions Applicable to All Sale and Purchase Transactions. (a)Section 12.3Any transaction effected under this Article XII or in connection with the acquisition of additionalCollateral Obligations during the Ramp-Up Period shall be conducted on an arm’s length basis,provided that the Collateral AgentTrustee shall have no responsibility to oversee compliancewith this clause (a) by the other parties.
Upon any acquisition of a Collateral Obligation pursuant to this Article (b)XII, all of the Issuer’s right, title and interest to the Pledged Obligation or Pledged Obligationsshall be Granted to the Collateral AgentTrustee pursuant to this Indenture and Security Agreement, such Pledged Obligations shall be Delivered to the Collateral AgentTrustee.
Notwithstanding anything contained in this Article XII to the contrary(c)(other than certain tax-related requirements, including the requirement that the Issuer comply atall times with the Tax Guidelines), the Issuer shall have the right to effect any sale of anyPledged Obligation or purchase of any Collateral Obligation (x) that has been separatelyconsented to by Holders of the DebtNotes evidencing at least 75% of the Aggregate OutstandingAmount of each Class of DebtNotes, and (y) of which the Trustee, the Collateral Agent and eachRating Agency has been notified (provided that in the case of a purchase of a CollateralObligation, that such purchase complies with the applicable requirements of Annex B to theInvestment Management Agreement).
ARTICLE XIII
HOLDERS’ RELATIONS
Subordination. (a) Anything in this Indenture and Security Section 13.1Agreement or the DebtNotes to the contrary notwithstanding, the Holders of each Class ofDebtNotes that constitute a Junior Class agree for the benefit of the Holders of the DebtNotes ofeach Priority Class with respect to such Junior Class that such Junior Class shall be subordinateand junior to the DebtNotes of each such Priority Class to the extent and in the manner set forthin Article XI of this Indenture and Security Agreement. On any Post-Acceleration Payment Dateor on the Stated Maturity, all accrued and unpaid interest on and outstanding principal of eachPriority Class shall be paid pursuant to Section 11.1(a)(iii) in full in Cash or, to the extent 100%of Holders of the Class A ObligationsNotes and a Majority of each Class of Rated DebtNotes
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(other than the Class A ObligationsNotes) consents, other than in Cash, before any furtherpayment or distribution is made on account of any Junior Class with respect thereto, to the extentand in the manner provided in Section 11.1(a)(iii).
Each Holder of DebtNotes of any Junior Class agrees with all Holders of(b)the applicable Priority Classes that such Holder of Junior Class DebtNotes shall not demand,accept, or receive any payment or distribution in respect of such Notes in violation of theprovisions of this Indenture and Security Agreement including, without limitation, this Section 13.1; provided that after all accrued and unpaid interest on and outstanding principal of a PriorityClass has been paid in full, the Holders of the related Junior Class or Classes shall be fullysubrogated to the rights of the Holders of such Priority Class. Nothing in this Section 13.1 shallaffect the obligation of the Issuer to pay Holders of any Junior Class of DebtNotes.
The Holders of each Class of DebtNotes agree, for the benefit of all(c)Holders of each Class of DebtNotes, not to cause the filing of a petition in bankruptcy against theIssuer, the Co-Issuer, the Income Note Issuer or any Issuer Subsidiary until the payment in fullof the DebtNotes and not before one year and a day, or if longer, the applicable preferenceperiod then in effect, has elapsed since such payment.
Standard of Conduct. In exercising any of its or their voting rights,Section 13.2rights to direct and consent or any other rights as a Holder under this Indenture and Security Agreement, a Holder or Holders shall not have any obligation or duty to any Person or toconsider or take into account the interests of any Person and shall not be liable to any Person forany action taken by it or them or at its or their direction or any failure by it or them to act or todirect that an action be taken, without regard to whether such action or inaction benefits oradversely affects any Holder, the Issuer, or any other Person, except for any liability to whichsuch Holder may be subject to the extent the same results from such Holder’s taking or directingan action, or failing to take or direct an action, in bad faith or in violation of the express terms ofthis Indenture and Security Agreement.
ARTICLE XIV
MISCELLANEOUS
Form of Documents Delivered to Trustee and the Collateral Section 14.1AgentTrustee. In any case where several matters are required to be certified by, or covered byan opinion of, any specified Person, it is not necessary that all such matters be certified by, orcovered by the opinion of, only one such Person, or that they be so certified or covered by onlyone document, but one such Person may certify or give an opinion with respect to some mattersand one or more other such Persons as to other matters, and any such Person may certify or givean opinion as to such matters in one or several documents.
Any certificate or opinion of an Officer of the Issuer, the Co-Issuer or theInvestment Manager may be based, insofar as it relates to legal matters, upon a certificate oropinion of, or representations by, counsel, unless such Officer knows, or should know that thecertificate or opinion or representations with respect to the matters upon which his certificate oropinion is based are erroneous. Any such certificate of an Officer of the Issuer, Co-Issuer or the
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Investment Manager or Opinion of Counsel may be based, insofar as it relates to factual matters,upon a certificate or opinion of, or representations by, the Issuer, the Co-Issuer, the InvestmentManager or any other Person, stating that the information with respect to such factual matters isin the possession of the Issuer, the Co-Issuer, the Investment Manager or such other Person,unless such Officer of the Issuer, Co-Issuer or the Investment Manager or such counsel knowsthat the certificate or opinion or representations with respect to such matters are erroneous. AnyOpinion of Counsel may also be based, insofar as it relates to factual matters, upon a certificateor opinion of, or representations by, an Officer of the Issuer or the Co-Issuer, stating that theinformation with respect to such matters is in the possession of the Issuer or the Co-Issuer,unless such counsel knows that the certificate or opinion or representations with respect to suchmatters are erroneous.
Where any Person is required to make, give or execute two (2) or moreapplications, requests, consents, certificates, statements, opinions or other instruments under thisIndenture and Security Agreement, they may, but need not, be consolidated and form oneinstrument.
Whenever in this Indenture and Security Agreement it is provided that theabsence of the occurrence and continuation of a Default or Event of Default is a conditionprecedent to the taking of any action by the Trustee or the Collateral AgentTrustee at the requestor direction of either Co-Issuer, then notwithstanding that the satisfaction of such condition is acondition precedent to such Co-Issuer’s right to make such request or direction, the Trustee and the Collateral Agent shall be protected in acting in accordance with such request or direction if itdoes not have knowledge of the occurrence and continuation of such Default or Event of Defaultas provided in Section 6.1(d) and Section 6.15(b)(vi).
The Trustee and the Collateral Agent agreeagrees to accept and act uponinstructions or directions pursuant to this Indenture and Security Agreement sent by unsecurede-mail of a .pdf instruction, facsimile transmission or other similar unsecured electronic methods(with the original to follow).
Acts of Holders. (a) Any request, demand, authorization,Section 14.2direction, notice, consent, waiver or other action provided by this Indenture and Security Agreement to be given or taken by Holders may be embodied in and evidenced by one or moreinstruments of substantially similar tenor signed by such Holders in writing or by an agent dulyappointed in writing; and, except as herein otherwise expressly provided, such action shallbecome effective when such instrument or instruments are delivered to the Collateral AgentTrustee, and, where it is hereby expressly required, to the Issuer. Such instrument orinstruments (and the action or actions embodied therein and evidenced thereby) are hereinsometimes referred to as the “Act of Holders” signing such instrument or instruments. Proof ofexecution of any such instrument or of a writing appointing any such agent shall be sufficient forany purpose of this Indenture and Security Agreement and conclusive in favor of the Collateral AgentTrustee and the Co-Issuers, if made in the manner provided in this Section 14.2.
The fact and date of the execution by any Person of any such instrument(b)or writing may be proved in any manner which the Collateral AgentTrustee deems sufficient.
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The principal amount or face amount, as the case may be, and registered(c)numbers of DebtNotes held by any Person, and the date of his holding the same, shall be provedby the Register or the Credit Agreement, as applicable.
Any request, demand, authorization, direction, notice, consent, waiver or(d)other action by the Holder of any DebtNotes shall bind the Holder (and any transferee thereof) ofsuch DebtNotes and of every Note or Class A Loan issued upon the registration thereof or inexchange therefor or in lieu thereof, in respect of anything done, omitted or suffered to be doneby the Collateral AgentTrustee or the Co-Issuers in reliance thereon, whether or not notation ofsuch action is made upon such DebtNotes.
At the expense of the Issuer, the Collateral AgentTrustee will deliver to(e)Holders of the Subordinated Notes notification of any amendments so notified by the IncomeNote Paying Agent to the Collateral AgentTrustee pursuant to Section 7.01 of the Income NotePaying Agency Agreement.
For the avoidance of doubt, any request, demand, authorization, direction,(f)notice, consent, waiver or other action provided by this Indenture and Security Agreement to begiven or taken by the Income Note Issuer as a Holder of Subordinated Notes may be evidencedby a writing signed by the Income Note Paying Agent on behalf of the Income Note Issuer.
Notices, etc., to Trustee, the Collateral Agent, the Co-Issuers, the Section 14.3Collateral Administrator, the Investment Manager, the Hedge Counterparty, the Income Note Paying Agent, the Administrator and each Rating Agency. (a) Any request, demand,authorization, direction, instruction, order, notice, consent, waiver or Act of Holders ofDebtNotes or other documents provided or permitted by this Indenture and Security Agreementto be made upon, given, e-mailed or furnished to, or filed with:
the Trustee shall be sufficient for every purpose hereunder if in writing(i)and made, given, furnished or filed to and mailed, by certified mail, return receiptrequested, hand delivered, sent by overnight courier service guaranteeing next daydelivery, by electronic mail or facsimile in legible form, to the Trustee addressed to it atThe Bank of New York Mellon Trust Company, National Association, Attention: GlobalCorporate Trust – THL Credit Wind River 2014-2 CLO Ltd., 601 Travis Street, 16thFloor, Houston, Texas 77002, telecopy no.: (713) 483-6001 or at any other addresspreviously furnished in writing to the other parties hereto by the Trustee;
(ii) the Collateral Agent shall be sufficient for every purpose hereunder if in writing and made, given, furnished or filed to and mailed, by certified mail, return receipt requested, hand delivered, sent by overnight courier service guaranteeing next day delivery or by facsimile in legible form, to the Collateral Agent addressed to it at The Bank of New York Mellon Trust Company, National Association, Attention: Global Corporate Trust – THL Credit Wind River 2014-2 CLO Ltd., 601 Travis Street, 16th Floor, Houston, Texas 77002, telecopy no.: (713) 483-6001 or at any other address previously furnished in writing to the other parties hereto by the Collateral Agent;
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(iii) the Co-Issuers shall be sufficient for every purpose hereunder (unless(ii)otherwise herein expressly provided) if in writing and mailed, first class postage prepaid,hand delivered, sent by overnight courier service or by facsimile in legible form, to theIssuer addressed to it at c/o MaplesFS Limited, P.O. Box 1093, Boundary Hall, CricketSquare, Grand Cayman, KY1-1102, Cayman Islands, Attention: The Directors, facsimileno. +1 (345) 945-7100 or to the Co-Issuer addressed to it at c/o Puglisi & Associates, 850Library Avenue, Suite 204, Newark, Delaware 19711, Attention: Donald J. Puglisi,facsimile no. (302) 738-7210, or at any other address previously furnished in writing tothe other parties hereto by the Issuer or the Co-Issuer, as the case may be, with a copy tothe Investment Manager at its address below;
(iv) the Investment Manager shall be sufficient for every purpose(iii)hereunder if in writing and mailed, first class postage prepaid, hand delivered, sent byovernight courier service or by facsimile in legible form, to the Investment Manageraddressed to it at THL Credit Advisors LLC, 222 W. Adams Street, Suite 2160, ChicagoIL, 60606, Attention: Mr. Robert Hickey, telephone no.: (630) 320-7842, facsimile no.:(732) 380-3337, or at any other address previously furnished in writing to the otherparties hereto;
(v) GreensLedge Capital Markets LLC, as Placement Agent, shall be(iv)sufficient for every purpose hereunder if in writing and mailed, first class postageprepaid, hand delivered, sent by overnight courier service or by telecopy in legible form,addressed to GreensLedge Capital Markets LLC, 520 Madison Avenue, 32nd Floor, NewYork, New York 10022, facsimile no. 212-792-5270, Attn: CDO Group, or at any otheraddress previously furnished in writing to the Co-Issuers and the Trustee by thePlacement Agent;
DBSI shall be sufficient for every purpose hereunder if in writing and (v)mailed, first class postage prepaid, hand delivered, sent by overnight courier service or by telecopy in legible form, addressed to 60 Wall Street, New York, New York, 10005, telephone: (212) 250-5855, Attention: Global Markets, or at any other address subsequently furnished in writing to the Co-Issuers and the Trustee by DBSI;
a Hedge Counterparty shall be sufficient for every purpose hereunder(vi)(unless otherwise herein expressly provided) if in writing and mailed, first class postageprepaid, hand delivered or sent by overnight courier service or by facsimile in legibleform to such Hedge Counterparty addressed to it at the address specified in the relevantHedge Agreement or at any other address previously furnished in writing to the Issuer orthe Trustee by such Hedge Counterparty;
the Collateral Administrator shall be sufficient for every purpose(vii)hereunder if in writing and mailed, first class postage prepaid, hand delivered, sent byovernight courier service or by facsimile in legible form, to the Collateral Administratoraddressed to it at The Bank of New York Mellon Trust Company, National Association,Attention: Global Corporate Trust – THL Credit Wind River 2014-2 CLO Ltd., 601
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Travis Street, 16th Floor, Houston, Texas 77002, telecopy no.: (713) 483-6001 or at anyother address previously furnished in writing to the other parties hereto; and
the Administrator shall be sufficient for every purpose hereunder if made,(viii)given, furnished or filed in writing to and mailed, by certified mail, return receiptrequested, hand delivered, sent by overnight courier service guaranteeing next daydelivery or by facsimile in legible form, to the Administrator addressed to it at MaplesFSLimited, P.O. Box 1093, Boundary Hall, Cricket Square, Grand Cayman KY1-1102,Cayman Islands;
(ix) the Irish Stock Exchange shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to and mailed, by certified mail, return receipt requested, hand delivered, sent by overnight courier service guaranteeing next day delivery or by facsimile in legible form, to the Irish Stock Exchange addressed to it at 28 Anglesea Street, Dublin 2, Ireland (or in respect of notices required to be released through the Irish Stock Exchange website, by submission via www.isedirect.ie (such notices to be sent in Microsoft Word format to the extent possible)); and
(x) the Irish Listing Agent shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to and mailed, by certified mail, return receipt requested, hand delivered, sent by overnight courier service guaranteeing next day delivery or by facsimile in legible form, to the Irish Listing Agent addressed to it at Maples and Calder, 75 St. Stephen’s Green, Dublin 2, Ireland, facsimile: + 353 1 619 2001, email: [email protected], or at any other address previously furnished in writing to the other parties hereto by the Irish Listing Agent.
Any request, demand, authorization, direction, order, notice, consent,(b)waiver or Act of Holders or other documents provided or permitted by this Indenture and Security Agreement, including the 17g-5 Information, to be made upon, given or furnished to, orfiled with the Rating Agencies shall be given in accordance with, and subject to, the provisionsof Section 14.15 hereof and shall be sufficient for every purpose hereunder (unless otherwiseherein expressly provided) if in writing to each Rating Agency addressed to it at (i) in the case ofMoody’s, to Moody’s Investor Services, Inc., 7 World Trade Center at 250 Greenwich Street,New York, NY 10007, Attention: CBO/CLO Monitoring and by email [email protected] and (ii) in the case of Fitch, by email [email protected].
In the event that any provision in this Indenture and Security Agreement(c)calls for any notice or document to be delivered simultaneously to the Trustee and any otherperson or entity, the Trustee’s receipt of such notice or document shall entitle the Trustee toassume that such notice or document was delivered to such other person or entity unlessotherwise expressly specified herein.
Notwithstanding any provision to the contrary contained herein or in any(d)agreement or document related thereto, any report, statement or other information required to beprovided by the Issuer [(except information required to be provided to the Irish Stock
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Exchange)] or the Collateral AgentTrustee may be provided by providing access to a websitecontaining such information.
The Bank (in each of its capacities) agrees to accept and act upon(e)instructions or directions pursuant to this Indenture and Security Agreement or any documentexecuted in connection herewith sent by unsecured email, facsimile transmission or other similarunsecured electronic methods, provided, however, that the Bank shall have received anincumbency certificate (which may be any incumbency certificate delivered on the Closing Datepursuant to Section 3.1(a)) listing such person as a person designated to provide suchinstructions or directions, which incumbency certificate may be amended whenever a person isadded or deleted from the listing. If such person elects to give the Bank email or facsimileinstructions (or instructions by a similar electronic method) and the Bank in its discretion electsto act upon such instructions, the Bank’s reasonable understanding of such instructions shall bedeemed controlling. The Bank shall not be liable for the Bank’s reliance upon and compliancewith such instructions notwithstanding such instructions conflicting with or being inconsistentwith a subsequent written instruction. Any person providing such instructions or directionsagrees to assume all risks arising out of the use of such electronic methods to submit instructionsand directions to the Bank, including without limitation the risk of the Bank acting onunauthorized instructions, and the risk of interception and misuse by third parties andacknowledges and agrees that there may be more secure methods of transmitting suchinstructions that the method(s) selected by it and agrees that the security procedures (if any) tobe followed in connection with its transmission of such instructions provide to it a commerciallyreasonable degree of protection in light of its particular needs and circumstances.
Notices to Holders; Waiver. Except as otherwise expresslySection 14.4provided herein, where this Indenture and Security Agreement provides for notice to Holders ofany event,
such notice shall be sufficiently given to Holders if in writing and mailed,(a)first class postage prepaid, to each Holder affected by such event, at the address of such Holderas it appears in the Register or, as applicable, in accordance with the procedures at DTC or, in the case of the Class A Loans, as it appears in the Credit Agreement, as soon as reasonablypracticable but in any case not earlier than the earliest date and not later than the latest date,prescribed for the giving of such notice;(b) for so long as any Notes are listed on the Irish Stock Exchange and the guidelines of the Irish Stock Exchange so require, notices to the Holders of such Notes shall also be sent to the Irish Stock Exchange for release through the Companies Announcements Office of the Irish Stock Exchange; and
(c) such notice shall be in the English language.(b)
Such notices shall be deemed to have been given on the date of such mailing.
Any notice, report or other communication delivered to the Income Note Issuerunder this Indenture and Security Agreement shall be delivered to the Income Note Issuer, with acopy to the Income Note Paying Agent.
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The Collateral AgentTrustee shall deliver to the Holders any information ornotice in its possession relating to this Indenture and Security Agreement requested to be sodelivered by at least 25% of the Holders of any Class of DebtNotes (by Aggregate OutstandingAmount), at the expense of the Issuer.
The Collateral AgentTrustee shall deliver to any Holder of DebtNotes or anyPerson that has certified to the Collateral AgentTrustee in a writing substantially in the form ofExhibit D to this Indenture and Security Agreement that it is the owner of a beneficial interest ina Global Note, any information or notice requested to be so delivered by a Holder or a Personthat has made such certification that is in its possession and all related costs will be borne by therequesting Holder or Person.
Neither the failure to mail any notice, nor any defect in any notice so mailed, toany particular Holder shall affect the sufficiency of such notice with respect to other Holders. Incase by reason of the suspension of regular mail service as a result of a strike, work stoppage orsimilar activity or by reason of any other cause it shall be impracticable to give such notice bymail of any event to Holders when such notice is required to be given pursuant to any provisionof this Indenture and Security Agreement, then such notification to Holders as shall be madewith the approval of the Collateral AgentTrustee shall constitute a sufficient notification to suchHolders for every purpose hereunder.
Where this Indenture and Security Agreement provides for notice in any manner,such notice may be waived in writing by any Person entitled to receive such notice, either beforeor after the event, and such waiver shall be the equivalent of such notice. Waivers of notice byHolders shall be filed with the Collateral AgentTrustee but such filing shall not be a conditionprecedent to the validity of any action taken in reliance upon such waiver.
Effect of Headings and Table of Contents. The Article and SectionSection 14.5headings herein (including those used in cross-references herein) and the Table of Contents arefor convenience only and shall not affect the construction hereof.
Successors and Assigns. All covenants and agreements in thisSection 14.6Indenture and Security Agreement by the Co-Issuers shall bind their respective successors andassigns, whether so expressed or not.
Separability. Except to the extent prohibited by applicable law, inSection 14.7case any provision in this Indenture and Security Agreement or in the Notes shall be invalid,illegal or unenforceable, the validity, legality, and enforceability of the remaining provisionsshall not in any way be affected or impaired thereby.
Benefits of Indenture and Security Agreement. Nothing in thisSection 14.8Indenture and Security Agreement or in the DebtNotes, expressed or implied, shall give to anyPerson, other than the parties hereto and their successors hereunder, the Investment Manager, theHolders of the DebtNotes, the Collateral Administrator and (to the extent provided herein) theAdministrator (solely in its capacity as such) and the other Secured Parties any benefit or anylegal or equitable right, remedy or claim under this Indenture and Security Agreement.
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Governing Law. THIS INDENTURE AND SECURITY Section 14.9AGREEMENT AND EACH DEBT AND ANY CLAIM, CONTROVERSY OR DISPUTEARISING UNDER OR RELATED TO THIS INDENTURE AND SECURITY AGREEMENT,THE RELATIONSHIP OF THE PARTIES, AND/OR THE INTERPRETATION ANDENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES SHALL BECONSTRUED IN ACCORDANCE WITH AND GOVERNED IN ALL RESPECTS(WHETHER IN CONTRACT OR IN TORT) BY THE LAWS OF THE STATE OF NEWYORK WITHOUT REGARD TO CONFLICT OF LAWS.
Submission to Jurisdiction. The Co-Issuers hereby irrevocablySection 14.10submit to the exclusive jurisdiction of any New York State or federal court sitting in the Boroughof Manhattan in The City of New York in any action or Proceeding arising out of or relating tothe Notes or this Indenture and Security Agreement, and the Co-Issuers hereby irrevocably agreethat all claims in respect of such action or Proceeding may be heard and determined in such NewYork State or federal court. The Co-Issuers hereby irrevocably waive, to the fullest extent thatthey may legally do so, the defense of an inconvenient forum to the maintenance of such actionor Proceeding and further waives the right to object, with respect to such Proceeding, that suchcourt does not have any jurisdiction over such party. The Co-Issuers irrevocably consent to theservice of any and all process in any action or Proceeding by the mailing or delivery of copies ofsuch process to it at the office of the Co-Issuers’ agent set forth in Section 7.2. The Co-Issuersagree that a final judgment in any such action or Proceeding shall be conclusive and may beenforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
Counterparts. This Indenture and Security Agreement (and eachSection 14.11amendment, modification and waiver in respect of it) and the Notes may be executed anddelivered in any number of counterparts (including by electronic mail or facsimile transmission),each of which so executed shall be deemed to be an original, but all such counterparts shalltogether constitute but one and the same instrument. Delivery of an executed counterpartsignature page of this Indenture and Security Agreement by electronic mail (PDF) or telecopyshall be effective as delivery of a manually executed counterpart of this Indenture and Security Agreement.
Acts of Issuer. Any report, information, communication, request,Section 14.12demand, authorization, direction, notice, consent, waiver or other action provided by thisIndenture and Security Agreement to be given or performed by the Issuer shall be effective ifgiven or performed by the Issuer or by the Investment Manager on the Issuer’s behalf.
Confidential Information. (a) The Trustee, the Collateral Agent,Section 14.13the Collateral Administrator and each Holder of DebtNotes shall maintain the confidentiality ofall Confidential Information in accordance with procedures adopted by the Issuer (afterconsultation with the Co-Issuers) or such Holder in good faith to protect ConfidentialInformation of third parties delivered to such Person; provided that such Person may deliver ordisclose Confidential Information to: (i) such Person’s directors, trustees, managers, members,officers, employees, agents, attorneys and affiliates who agree to hold confidential theConfidential Information substantially in accordance with the terms of this Section 14.13 and tothe extent such disclosure is reasonably required for the administration of this Indenture and
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Security Agreement, the matters contemplated hereby or the investment represented by theDebtNotes; (ii) such Person’s legal advisors, financial advisors and other professional advisorswho agree to hold confidential the Confidential Information substantially in accordance with theterms of this Section 14.13 and to the extent such disclosure is reasonably required for theadministration of this Indenture and Security Agreement, the matters contemplated hereby or theinvestment represented by the DebtNotes; (iii) any other Holder, or any of the other parties tothis Indenture and Security Agreement, the Investment Management Agreement or the CollateralAdministration Agreement; (iv) any Person of the type that would be, to such Person’sknowledge, permitted to acquire DebtNotes in accordance with the requirements of Section 2.6hereof to which such Person sells or offers to sell any such DebtNotes or any part thereof (if suchPerson has agreed in writing prior to its receipt of such Confidential Information to be bound bythe provisions of this Section 14.13); (v) any other Person from which such former Person offersto purchase any security of the Co-Issuers (if such other Person has agreed in writing prior to itsreceipt of such Confidential Information to be bound by the provisions of this Section 14.13);(vi) any Federal or state or other regulatory, governmental or judicial authority havingjurisdiction over such Person; (vii) the National Association of Insurance Commissioners or anysimilar organization, or any nationally recognized rating agency that requires access toinformation about the investment portfolio of such Person, reinsurers and liquidity and creditproviders that agree to hold confidential the Confidential Information substantially in accordancewith this Section 14.13; (viii) Moody’s or Fitch; (ix) any other Person with the written consent ofthe Co-Issuers and the Investment Manager; (x) any other disclosure that is permitted or requiredunder this Indenture and Security Agreement or the Collateral Administration Agreement; or (xi)any other Person to which such delivery or disclosure may be necessary or appropriate (A) toeffect compliance with any law, rule, regulation or order applicable to such Person, (B) inresponse to any subpoena or other legal process upon prior notice to the Co-Issuers (unlessprohibited by applicable law, rule, order or decree or other requirement having the force of law),(C) in connection with any litigation to which such Person is a party upon prior notice to theCo-Issuers (unless prohibited by applicable law, rule, order or decree or other requirementhaving the force of law), (D) if an Event of Default has occurred and is continuing, to the extentsuch Person may reasonably determine such delivery and disclosure to be necessary orappropriate in the enforcement or for the protection of the rights and remedies under theDebtNotes or this Indenture and Security Agreement or (E) in the Trustee’s or CollateralAdministrator’s performance of its obligations under this Indenture and Security Agreement, theCollateral Administration Agreement or other transaction documents related thereto; provided,further, that delivery to Holders by the Trustee or the Collateral Administrator of any report orinformation required by the terms of this Indenture and Security Agreement to be provided toHolders shall not be a violation of this Section 14.13. Each Holder of DebtNotes agrees, exceptas set forth in clauses (vi), (vii) and (x) above, that it shall use the Confidential Information forthe sole purpose of making an investment in the DebtNotes or administering its investment in theDebtNotes; and that the Trustee, the Collateral Agent and the Collateral Administrator shallneither be required nor authorized to disclose to Holders any Confidential Information inviolation of this Section 14.13. In the event of any required disclosure of the ConfidentialInformation by such Holder, such Holder agrees to use reasonable efforts to protect theconfidentiality of the Confidential Information. Each Holder of DebtNotes, by its acceptance ofDebtNotes shall be deemed to have agreed to be bound by and to be entitled to the benefits ofthis Section 14.13. Notwithstanding the foregoing, the Trustee, the Collateral Agent, the
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Collateral Administrator, the Holders and beneficial owners of the DebtNotes (and each of theirrespective employees, representatives or other agents) may disclose to any and all Persons,without limitation of any kind, the U.S. federal, state and local income tax treatment of the Issuerand the transactions contemplated by this Indenture and Security Agreement and all materials ofany kind (including opinions or other tax analyses) that are provided to them relating to suchU.S. federal, state and local income tax treatment.
For the purposes of this Section 14.13, “Confidential Information” means(b)information delivered to the Trustee, the Collateral Agent, the Collateral Administrator or anyHolder of DebtNotes by or on behalf of the Co-Issuers in connection with and relating to thetransactions contemplated by or otherwise pursuant to this Indenture and Security Agreement;provided that such term does not include information that: (i) was publicly known or otherwiseknown to the Trustee, the Collateral Agent, the Collateral Administrator or such Holder prior tothe time of such disclosure; (ii) subsequently becomes publicly known through no act oromission by the Trustee, the Collateral Agent, the Collateral Administrator, any Holder or anyperson acting on behalf of the Trustee, the Collateral Agent, the Collateral Administrator or anyHolder; (iii) otherwise is known or becomes known to the Trustee, the Collateral Agent, theCollateral Administrator or any Holder other than (x) through disclosure by the Co-Issuers or (y)to the knowledge of the Trustee, the Collateral Agent, the Collateral Administrator or a Holder,as the case may be, in each case after reasonable inquiry, as a result of the breach of a fiduciaryduty to the Co-Issuers or a contractual duty to the Co-Issuers; or (iv) is allowed to be treated asnon-confidential by consent of the Co-Issuers.
Notwithstanding the foregoing, the Trustee, the Collateral Agent and the(c)Collateral Administrator may disclose Confidential Information to the extent disclosure may berequired by law or by any regulatory or governmental authority and the Trustee, the Collateral Agent and the Collateral Administrator may disclose on a confidential basis any ConfidentialInformation to its agents, attorneys and auditors in connection with the performance of itsresponsibilities hereunder.
Liability of Co-Issuers. Notwithstanding any other terms of thisSection 14.14Indenture and Security Agreement, the DebtNotes or any other agreement entered into between,inter alia, the Co-Issuers or otherwise, neither of the Co-Issuers shall have any liabilitywhatsoever to the other of the Co-Issuers under this Indenture and Security Agreement, theCredit Agreement, the DebtNotes, any such agreement or otherwise and, without prejudice to thegenerality of the foregoing, neither of the Co-Issuers shall be entitled to take any action toenforce, or bring any action or Proceeding, in respect of this Indenture and Security Agreement,the Credit Agreement, the DebtNotes, any such agreement or otherwise against the other of theCo-Issuers. In particular, neither of the Co-Issuers shall be entitled to petition or take any othersteps for the winding up or bankruptcy of the other of the Co-Issuers or shall have any claim inrespect to any assets of the other of the Co-Issuers.
17g-5 Information. (a) The Co-Issuers shall comply with theirSection 14.15obligations under Rule 17g-5 promulgated under the Exchange Act (“Rule 17g-5”), by their ortheir agent’s posting on the 17g-5 Website, no later than the time such information is provided tothe Rating Agencies, all information (which shall not include any accountant’s report) that theCo-Issuers or other parties on their behalf, including the Trustee, the Collateral Agent, the
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Collateral Administrator and the Investment Manager, provide to the Rating Agencies for thepurposes of determining the initial credit rating of the Rated DebtNotes or undertaking creditrating surveillance of the Rated DebtNotes (the “17g-5 Information”); provided that no partyother than the Issuer, the Trustee, the Collateral Agent or the Investment Manager may provideinformation to the Rating Agencies on the Co-Issuers’ behalf without the prior written consent ofthe Investment Manager. At all times while any Rated Debt isNotes are rated by any RatingAgency or any other NRSRO, the Co-Issuers shall engage a third-party to post 17g-5Information to the 17g-5 Website. The Issuer hereby engages the Trustee (in such capacity, the“Information Agent”), to post 17g-5 Information it receives from the Issuer, the Trustee, the Collateral Agent or the Investment Manager to the 17g-5 Website in accordance with thisSection 14.15, and the Trustee hereby accepts such engagement.
To the extent that any of the Issuer, the Co-Issuer, the Investment(b)Manager, the Collateral Administrator, the Collateral AgentTrustee or the Trustee is required toprovide any information to, or communicate with, any Rating Agency in accordance with itsobligations under this Indenture and Security Agreement or the Investment ManagementAgreement or the Collateral Administration Agreement (as applicable), the Issuer, the Co-Issuer,the Investment Manager, the Collateral Administrator, the Collateral AgentTrustee or theTrustee, as applicable (or their respective representatives or advisors), shall provide suchinformation or communication to the Information Agent by e-mail [email protected] with the subject line specifically referring to “17g-5Information” and “THL CREDIT WIND RIVER 2014-2 CLO LTD., or such other e-mailaddress or subject line specified by the Information Agent in writing to the Issuer and theInvestment Manager. The Information Agent shall promptly upload such information to the17g-5 Website in accordance with the procedures set forth in Section 14.3(b). The InformationAgent shall give such supplying party notice on a reasonably prompt basis (which may be in theform of e-mail) that such information has been uploaded to the 17g-5 Website. Each e-mail sentto the Information Agent pursuant to this Indenture and Security Agreement failing to be sent tothe e-mail address or which does not contain a subject line conforming to the requirements ofthis Section shall be deemed incomplete and the Information Agent shall have no obligationswith respect thereto.
Additionally, to the extent that (x) any Rating Agency makes an inquiry or(c)initiates communications with the Issuer, the Co-Issuer, the Investment Manager, the CollateralAdministrator, the Collateral AgentTrustee or the Trustee or (y) any such party initiatescommunication with any Rating Agency that, in either case, is relevant to such Rating Agency’scredit rating surveillance of the Rated DebtNotes, (i) all written responses to such inquiries orcommunications shall be provided to the Information Agent who shall promptly post suchwritten response to the 17g-5 Website in accordance with the procedures set forth in Section 14.3(b), and (ii) any such oral communications with any Rating Agency shall be either (a)recorded and an audio file containing the recording to be promptly delivered to the InformationAgent for posting to the 17g-5 Website or (b) summarized in writing and the summary to bepromptly delivered to the Information Agent for posting to the 17g-5 Website, and theInformation Agent shall promptly post such information to the 17g-5 Website in accordance withthe procedures set forth in Section 14.3(b). In each case, the Information Agent shall give suchsupplying party notice on a reasonably prompt basis (which may be in the form of e-mail) thatsuch information has been uploaded to the 17g-5 Website.
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All information to be made available to the Rating Agencies pursuant to(d)Section 14.3(b) shall be made available by the Information Agent on the 17g-5 Website. 17g-5Information will be posted by the Information Agent on the same Business Day of receiptprovided that such information is received by 12:00 p.m. (Eastern time) or, if received after12:00 p.m. (Eastern time), on the next Business Day. The Information Agent shall have noobligation or duty to verify, confirm or otherwise determine whether the information beingdelivered is accurate, complete, conforms to the transaction or otherwise is or is not anythingother than what it purports to be. In the event that any information is delivered or posted inerror, the Information Agent may remove it from the 17g-5 Website, and shall so removepromptly when instructed to do so by the Person that delivered such information to theInformation Agent. None of the Trustee, the Collateral Agent, the Investment Manager, theCollateral Administrator and the Information Agent shall have obtained or shall be deemed tohave obtained actual knowledge of any information solely due to receipt and posting to the 17g-5Website. Access will be provided by the Information Agent to the Issuer, the InvestmentManager, the Rating Agencies, and to any NRSRO upon receipt by the Issuer and theInformation Agent of an NRSRO Certification from such NRSRO (which may be submittedelectronically via the 17g-5 Website).
In connection with providing access to the 17g-5 Website, the Information(e)Agent may require registration and the acceptance of a disclaimer. The Information Agent shallnot be liable for unauthorized disclosure of any information that it disseminates in accordancewith Section 14.3(b) and makes no representations or warranties as to the accuracy orcompleteness of information made available on the 17g-5 Website. The Information Agent shallnot be responsible or liable for the dissemination of any identification numbers or passwords forthe 17g-5 Website, including by the Issuer, the Rating Agencies, the NRSROs, any of theiragents or any other party. In no event shall the Information Agent be responsible for creating ormaintaining the 17g-5 Website. The Information Agent shall have no liability for any failure,error, malfunction, delay, or other circumstances beyond the reasonable control of theInformation Agent, associated with the 17g-5 Website. The Information Agent shall not beresponsible for and shall not be in default hereunder, or incur any liability for any act oromission, failure, error, malfunction or delays in carrying out any of its duties which results from(i) the Issuer’s, Investment Manager’s or any other party’s failure to deliver all or a portion ofthe 17g-5 Information to the Information Agent; (ii) defects in the 17g-5 Information supplied bythe Issuer, the Investment Manager or any other party to the Information Agent; (iii) theInformation Agent acting in accordance with 17g-5 Information prepared or supplied by anyparty; (iv) the failure or malfunction of the 17g-5 Website; or (v) any other circumstancesbeyond the reasonable control of the Information Agent. The Information Agent shall be underno obligation to make any determination as to the veracity or applicability of any 17g-5Information provided to it hereunder, or whether any such Information is required to bemaintained on the 17g-5 Website pursuant to the Indenture and Security Agreement or underRule 17g-5. The Information Agent shall not be liable for its failure to make any informationavailable to the Rating Agencies or NRSROs unless such information was delivered to theInformation Agent at the email address set forth in Section 14.15(a), with a subject heading of“THL CREDIT WIND RIVER 2014-2 CLO LTD.” and sufficient detail to indicate that suchinformation is required to be posted on the 17g-5 Website.
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Notwithstanding the requirements herein, the Trustee shall have no(f)obligation to engage in or respond to any oral communications, for the purposes of determiningthe initial credit rating of the DebtNotes or undertaking credit rating surveillance of theDebtNotes, with any Rating Agency or any of their respective officers, directors or employees.
Notwithstanding anything to the contrary in this Indenture and Security (g)Agreement, a breach of this Section 14.15 shall not constitute a Default or Event of Default.
To the extent that the Issuer or the Trustee (or any of their respective(h)agents) posts information to the 17g-5 Website and the Issuer or Trustee (as the case may be) isnot otherwise obligated to disclose such information to the Investment Manager, then the Issueror Trustee (as the case may be) shall promptly forward a copy of such posted information to theInvestment Manager.
Rating Agency Conditions. (a) Notwithstanding the terms of theSection 14.16Investment Management Agreement, any Hedge Agreement or other provisions of this Indenture and Security Agreement, if any action under the Investment Management Agreement, any HedgeAgreement or this Indenture and Security Agreement requires satisfaction of the Moody’s RatingCondition or the Global Rating Agency Condition as a condition precedent to such action, if theparty (the “Requesting Party”) required to obtain satisfaction of such condition has made arequest to any applicable Rating Agency for satisfaction of such condition and, within 10Business Days of such request being posted to the 17g-5 Website, such Rating Agency has notreplied to such request or has responded in a manner that indicates that such Rating Agency isneither reviewing such request nor waiving the requirement for satisfaction of such condition,then such Requesting Party shall be required to confirm that the applicable Rating Agency hasreceived the request, and, if it has, promptly (but in no event later than one Business Daythereafter) request satisfaction of the related condition again.
Any request for satisfaction of any such condition described in Section (b)14.16(a) made by the Issuer (or Investment Manager on its behalf), Co-Issuer, the Collateral AgentTrustee or Trustee, as applicable, pursuant to this Indenture and Security Agreement, shallbe made in writing, which writing shall contain a cover page indicating the nature of the requestfor satisfaction of such condition, and shall contain all back-up material necessary for the RatingAgency to process such request. Such written request for satisfaction of such condition shall beprovided in electronic format to the Information Agent for posting on the 17g-5 Website inaccordance with Section 14.15 hereof, and after receiving actual knowledge of such posting(which may be in the form of an automatic email notification of posting delivered by the 17g-5Website to such party), the Issuer (or the Investment Manager on its behalf), Co-Issuer, theCollateral AgentTrustee or Trustee, as applicable, shall send the request for satisfaction of suchcondition to the Rating Agencies in accordance with the delivery instructions set forth in Section 14.13(b).
Waiver of Jury Trial. THE TRUSTEE, THE COLLATERAL Section 14.17AGENT, THE HOLDERS AND EACH OF THE CO-ISSUERS EACH HEREBYKNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES (TO THE EXTENTPERMITTED BY APPLICABLE LAW) ANY RIGHTS IT MAY HAVE TO A TRIAL BY
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JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,UNDER, OR IN CONNECTION WITH, THIS INDENTURE AND SECURITY AGREEMENT, THE CREDIT AGREEMENT, THE DEBT OR ANY OTHER RELATEDDOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS(WHETHER VERBAL OR WRITTEN), OR ACTIONS OF THE TRUSTEE OR EITHER OFTHE CO-ISSUERS. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THETRUSTEE AND THE CO-ISSUERS TO ENTER INTO THIS INDENTURE AND SECURITY AGREEMENT.
Escheat. In the absence of a written request from the Co-Issuers toSection 14.18return unclaimed funds to the Co-Issuers, the Collateral AgentTrustee may from time to timefollowing the final Payment Date with respect to the DebtNotes deliver all unclaimed funds to oras directed by applicable escheat authorities, as determined by the Collateral AgentTrustee in itssole discretion, in accordance with the customary practices and procedures of the Collateral AgentTrustee. Any unclaimed funds held by the Collateral AgentTrustee pursuant to thisSection 14.18 shall be held uninvested and without any liability for interest.
Records. For the term of the DebtNotes, copies of theSection 14.19Memorandum and Articles of Association of the Issuer, the Certificate of Formation and LimitedLiability Company Agreement of the Co-Issuer and this Indenture and Security Agreement shallbe available for inspection by the Holders of the DebtNotes in electronic form at the office of theCollateral AgentTrustee upon prior written request and during normal business hours of theCollateral AgentTrustee.
Section 14.20 Redemption. Any reference to a “redemption” of the Debt means, as it relates to the Class A Loans, the prepayment of such Class A Loans pursuant to this Indenture and Security Agreement and the Credit Agreement.
Section 14.21 The Collateral Agent and the Loan Agent. In connection with any requirement for the Collateral Agent to provide notice to the Class A Lenders, the Collateral Agent shall provide such notice to the Loan Agent who shall provide such notice to the Class A Lenders pursuant to the Credit Agreement; provided that, solely for purposes of notice to the Class A Lenders, delivery of notice to the Loan Agent shall be deemed sufficient delivery for all purposes of this Indenture and Security Agreement.
(b) In connection with any requirement for the Collateral Agent to make payments to the Class A Lenders, the Collateral Agent shall make such payments to the Loan Agent who shall on the same Business Day, pay the Class A Lenders pursuant to the Credit Agreement; provided that, solely for purposes of payments to the Class A Lenders, payment to the Loan Agent shall be deemed sufficient payment for all purposes of this Indenture and Security Agreement.
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ARTICLE XV
ASSIGNMENT OF INVESTMENT MANAGEMENT AGREEMENT
Assignment of Investment Management Agreement. (a) TheSection 15.1Issuer hereby acknowledges that its Grant pursuant to the first Granting Clause hereof includesall of the Issuer’s estate, right, title and interest in, to and under the Investment ManagementAgreement, including (i) the right to give all notices, consents and releases thereunder, (ii) theright to give all notices of termination and to take any legal action upon the breach of anobligation of the Investment Manager thereunder, including the commencement, conduct andconsummation of Proceedings at law or in equity, (iii) the right to receive all notices,accountings, consents, releases and statements thereunder and (iv) the right to do any and allother things whatsoever that the Issuer is or may be entitled to do thereunder; provided thatexcept as otherwise expressly set forth in this Indenture and Security Agreement, the Collateral AgentTrustee shall not have the authority to exercise any of the rights set forth in (i) through (iv)above or that may otherwise arise as a result of the Grant until the occurrence of an Event ofDefault hereunder and such authority shall terminate at such time, if any, as such Event ofDefault is cured or waived.
The assignment made hereby is executed as collateral security, and the(b)execution and delivery hereby shall not in any way impair or diminish the obligations of theIssuer under the provisions of the Investment Management Agreement, or increase, impair oralter the rights and obligations of the Investment Manager under the Investment ManagementAgreement, nor shall any of the obligations contained in the Investment Management Agreementbe imposed on the Collateral AgentTrustee.
Upon the retirement or repayment of the DebtNotes, the payment of all(c)amounts required to be paid pursuant to the Priority of Payments and the release of the Assetsfrom the lien of this Indenture and Security Agreement, this assignment and all rights hereinassigned to the Collateral AgentTrustee for the benefit of the Holders of DebtNotes shall ceaseand terminate and all the estate, right, title and interest of the Collateral AgentTrustee in, to andunder the Investment Management Agreement shall revert to the Issuer and no further instrumentor act shall be necessary to evidence such termination and reversion.
The Issuer represents that the Issuer has not executed any other(d)assignment of the Investment Management Agreement.
The Issuer agrees that this assignment is irrevocable, and that it shall not(e)take any action which is inconsistent with this assignment or make any other assignmentinconsistent herewith. The Issuer shall, from time to time upon the request of the Trustee,execute all instruments of further assurance and all such supplemental instruments with respectto this assignment.
The Issuer hereby agrees that the Issuer shall not enter into any agreement(f)amending, modifying or terminating the Investment Management Agreement except inaccordance with the terms of the Investment Management Agreement.
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The Collateral AgentTrustee shall have no obligations under the(g)Investment Management Agreement.
ARTICLE XVI
HEDGE AGREEMENTS
Hedge Agreements. (a) The Issuer may enter into HedgeSection 16.1Agreements from time to time on and after the Closing Date solely for the purpose of managinginterest rate and other risks/or foreign exchange risk(s) in connection with the Issuer’s issuanceof, and making payments on, the Notes. The Issuer shall promptly provide notice of entry intoany Hedge Agreement to the Trustee, the Collateral Agent and Moody’s. Notwithstandinganything to the contrary contained in this Indenture and Security Agreement, the Issuer (or theInvestment Manager on behalf of the Issuer) shall not enter into any Hedge Agreement or anyamendment of any Hedge Agreement unless the Global Rating Agency Condition has beensatisfied. The Issuer shall provide a copy of each Hedge Agreement and any amendment to aHedge Agreement to each Rating Agency promptly upon entry therein.
Each Hedge Agreement shall (x) contain appropriate limited recourse andnon-petition provisions equivalent (mutatis mutandis) to those contained in Section 2.8(h) andSection 5.4(d) and (y) directly relate to the Collateral Obligations or the Notes and be intended toreduce the interest rate and/or foreign exchange risk(s) related to the Collateral Obligations orthe Rated DebtNotes. Each Hedge Counterparty shall be required to have, at the time that anyHedge Agreement to which it is a party is entered into, the Required Hedge CounterpartyRatings unless the applicable Rating Agency Condition is satisfied or credit support is providedas set forth in the Hedge Agreement. Payments with respect to Hedge Agreements shall besubject to Article XI. Each Hedge Agreement shall contain an acknowledgement by the HedgeCounterparty that the obligations of the Issuer to the Hedge Counterparty under the relevantHedge Agreement shall be payable in accordance with Article XI of this Indenture and Security Agreement.
The Issuer shall not enter into or amend Hedge Agreements unless it obtains (wx)the consent of the Initial Majority Subordinated Noteholder (so long as the Initial MajoritySubordinated Noteholder Condition is satisfied), (x) the prior written consent of 100% of the Section 13 Banking Entities, (y) written advice from legal counsel and a certification from theInvestment Manager that (1) the written terms of the derivative directly relate to the CollateralObligations and the DebtNotes and (2) such derivative reduces the interest rate and/or foreignexchange risks related to the Collateral Obligations and the DebtNotes and (z) written advicefrom legal counsel that such Hedge Agreement will not cause any person to be required toregister as a “commodity pool operator” (within the meaning of the Commodity Exchange Act)with the Commodity Futures Trading Commission in connection with the Issuer.
In the event of any early termination of a Hedge Agreement with respect(b)to which the Hedge Counterparty is the sole “defaulting party” or “affected party” (each asdefined in the Hedge Agreements), (i) any termination payment paid by the Hedge Counterpartyto the Issuer may be paid to a replacement Hedge Counterparty at the direction of the Investment
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Manager and (ii) any payment received from a replacement Hedge Counterparty may be paid tothe replaced Hedge Counterparty at the direction of the Investment Manager under theterminated Hedge Agreement; provided that (in the case of any such payment under subclause (i)or (ii) above, the Global Rating Agency Condition has been satisfied with respect thereto.
The Issuer (or the Investment Manager on its behalf) shall, upon receiving(c)written notice of the exposure calculated under a credit support annex to any Hedge Agreement,if applicable, make a demand to the relevant Hedge Counterparty and its credit support provider,if applicable, for securities having a value under such credit support annex equal to the requiredcredit support amount.
Each Hedge Agreement shall, at a minimum, permit the Issuer to(d)terminate such agreement (with the Hedge Counterparty bearing the costs of any replacementHedge Agreement) if such Hedge Counterparty fails to do any of the following as and whenapplicable; provided that the Issuer shall not terminate any Hedge Agreement for any reasonunless the Global Rating Agency Condition has been satisfied with respect thereto.
If any Moody’s rating of the Hedge Counterparty (or its guarantor under theHedge Agreement) is downgraded to
the first trigger level or lower (but above the second trigger level), such(i)Hedge Counterparty must provide Hedge Counterparty Credit Support or, at its own cost,assign the Hedge Agreement to a Hedge Counterparty that meets the Required HedgeCounterparty Rating of Moody’s within 30 days; and
the second trigger level or lower, or if the rating of the Hedge(ii)Counterparty (or its guarantor under the Hedge Agreement) is withdrawn, such HedgeCounterparty must, at its own cost, assign the Hedge Agreement to a Hedge Counterpartyand if such assignment has not been accomplished within 30 days, provide HedgeCounterparty Credit Support pending such assignment.
Moody’s Trigger Level Short-term/long-term Long-term (no short-term)First P-2/A3 A2Second P-3/Baa1 Baa1
The Issuer shall give prompt notice to each Rating Agency of any(e)termination of a Hedge Agreement or agreement to provide Hedge Counterparty Credit Support.Any collateral received from a Hedge Counterparty under a Hedge Agreement shall be depositedin the Hedge Counterparty Collateral Account.
If a Hedge Counterparty has defaulted in the payment when due of its(f)obligations to the Issuer under the Hedge Agreement, promptly after an Authorized Officerbecomes aware thereof the Investment Manager shall make a demand on the Hedge Counterparty(or its guarantor under the Hedge Agreement) with a copy to the Trustee, demanding payment bythe close of business on such date (or by such time on the next succeeding Business Day if suchknowledge is obtained after 11:30 a.m., New York time).
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Each Hedge Agreement shall provide that it may not be terminated due to(g)the occurrence of an Event of Default until liquidation of the Collateral has commenced.
[Signature page follows]
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IN WITNESS WHEREOF, we have set our hands as of the day and year firstwritten above.
EXECUTED AS A DEED BY
THL CREDIT WIND RIVER 2014-2 CLOLTD., as Issuer
By:Name:Title:
In the presence of:
Witness:Name:Title:
[Signature Page to Indenture and Security Agreement]USActive 38876250.2
THL CREDIT WIND RIVER 2014-2 CLOLLC, as Co-Issuer
By:Name:Title:
[Signature Page to Indenture and Security Agreement]USActive 38876250.2
THE BANK OF NEW YORK MELLONTRUST COMPANY, NATIONALASSOCIATION, as Trustee
By:Name:Title:
THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, as Collateral Agent
By:Name:Title:
[Signature Page to Indenture and Security Agreement]USActive 38876250.2
SCHEDULE 1
MOODY’S INDUSTRY CLASSIFICATION GROUP LIST
Aerospace & Defense1.Automotive2.Banking, Finance, Insurance & Real Estate3.Beverage, Food & Tobacco4.Capital Equipment5.Chemicals, Plastics & Rubber6.Construction & Building7.Consumer goods: Durable8.Consumer goods: Non-durable9.Containers, Packaging & Glass10.Energy: Electricity11.Energy: Oil & Gas12.Environmental Industries13.Forest Products & Paper14.Healthcare & Pharmaceuticals15.High Tech Industries16.Hotel, Gaming & Leisure17.Media: Advertising, Printing & Publishing18.Media: Broadcasting & Subscription19.Media: Diversified & Production20.Metals & Mining21.Retail22.Services: Business23.Services: Consumer24.Sovereign & Public Finance25.Telecommunications26.Transportation: Cargo27.Transportation: Consumer28.Utilities: Electric29.Utilities: Oil & Gas30.Utilities: Water31.Wholesale32.
SCH. 1- 1USActive 38876250.2
SCHEDULE 2
S&P INDUSTRY CLASSIFICATIONS
Industry Code Description
Industry Code Description
0 Zero Default Risk 39 Utilities1 Aerospace & Defense 40 Mortgage REITs2 Air transport 41 Equity REITs and REOCs3 Automotive 43 Life Insurance4 Beverage & Tobacco 44 Health Insurance5 Radio & Television 45 Property & Casualty Insurance7 Building & Development 46 Diversified Insurance8 Business equipment & services 50 CDO of corporate and emerging market corporate9 Cable & satellite television 50A CDO of SF
10 Chemicals & plastics 50B CDO other11 Clothing/textiles 51 ABS Consumer12 Conglomerates 52 ABS Commercial13 Containers & glass products 53 CMBS Diversified (Conduit and CTL); CMBS
(large loan, single borrower, and single property); commercial real estate interests; commercial real estate loans
14 Cosmetics/toiletries 56 RMBS, home equity loans, home equity lines of credit, tax lien, and manufactured housing
15 Drugs 59 U.S./Sovereign Agency (Explicitly guaranteed)16 Ecological services & equipment 60 SF third-party guaranteed17 Electronics/electrical 62 FFELP Student Loans (Over 70% FFELP)18 Equipment leasing19 Farming/agriculture20 Financial Intermediaries21 Food/drug retailers22 Food products23 Food service24 Forest products25 Health care26 Home furnishings27 Lodging & casinos28 Industrial equipment
Leisure30 goods/activities/movies31 Nonferrous metals/minerals32 Oil & gas33 Publishing34 Rail industries35 Retailers (except food & drug)36 Steel37 Surface transport38 Telecommunications
Asset Type Code
Asset Type Description
1020000 Energy Equipment & Services
SCH. 2- 2USActive 38876250.2
1030000 Oil, Gas & Consumable Fuels
2020000 Chemicals
2030000 Construction Materials
2040000 Containers & Packaging
2050000 Metals & Mining
2060000 Paper & Forest Products
3020000 Aerospace & Defense
3030000 Building Products
3040000 Construction & Engineering
3050000 Electrical Equipment
3060000 Industrial Conglomerates
3070000 Machinery
3080000 Trading Companies & Distributors
3110000 Commercial Services & Supplies
9612010 Professional Services
3210000 Air Freight & Logistics
3220000 Airlines
3230000 Marine
3240000 Road & Rail
3250000 Transportation Infrastructure
4011000 Auto Components
4020000 Automobiles
4110000 Household Durables
4120000 Leisure Products
4130000 Textiles, Apparel & Luxury Goods
4210000 Hotels, Restaurants & Leisure
9551701 Diversified Consumer Services
4310000 Media
4410000 Distributors
4420000 Internet and Catalog Retail
4430000 Multiline Retail
4440000 Specialty Retail
5020000 Food & Staples Retailing
5110000 Beverages
5120000 Food Products
SCH. 2- 3USActive 38876250.2
5130000 Tobacco
5210000 Household Products
5220000 Personal Products
6020000 Health Care Equipment & Supplies
6030000 Health Care Providers & Services
9551729 Health Care Technology
6110000 Biotechnology
6120000 Pharmaceuticals
9551727 Life Sciences Tools & Services
7011000 Banks
7020000 Thrifts & Mortgage Finance
7110000 Diversified Financial Services
7120000 Consumer Finance
7130000 Capital Markets
7210000 Insurance
7311000 Real Estate Investment Trusts (REITs)
7310000 Real Estate Management & Development
8020000 Internet Software & Services
8030000 IT Services
8040000 Software
8110000 Communications Equipment
8120000 Technology Hardware, Storage & Peripherals
8130000Electronic Equipment, Instruments &
Components
8210000 Semiconductors & Semiconductor Equipment
9020000 Diversified Telecommunication Services
9030000 Wireless Telecommunication Services
95200009530000
Electric UtilitiesGas Utilities
9540000 Multi-Utilities
9550000 Water Utilities
9551702Independent Power and Renewable Electricity
Producers
PF1 Project finance: industrial equipment
PF2 Project finance: leisure and gaming
SCH. 2- 4USActive 38876250.2
PF3 Project finance: natural resources and mining
PF4 Project finance: oil and gas
PF5 Project finance: power
PF6 Project finance: public finance and real estate
PF7 Project finance: telecommunications
PF8 Project finance: transport
SCH. 2- 5USActive 38876250.2
SCHEDULE 3
DIVERSITY SCORE CALCULATION
The Diversity Score is calculated as follows:
An “Issuer Par Amount” is calculated for each issuer of a Collateral(a)Obligation, and is equal to the Aggregate Principal Balance of all the Collateral Obligationsissued by that issuer and all affiliates.
An “Average Par Amount” is calculated by summing the Issuer Par(b)Amounts for all issuers, and dividing by the number of issuers.
An “Equivalent Unit Score” is calculated for each issuer, and is equal to(c)the lesser of (x) one and (y) the Issuer Par Amount for such issuer divided by the Average ParAmount.
An “Aggregate Industry Equivalent Unit Score” is then calculated for each(d)of the Moody’s industry classification groups, shown on Schedule 1, and is equal to the sum ofthe Equivalent Unit Scores for each issuer in such industry classification group.
An “Industry Diversity Score” is then established for each Moody’s(e)industry classification group, shown on Schedule 1, by reference to the following table for therelated Aggregate Industry Equivalent Unit Score; provided that if any Aggregate IndustryEquivalent Unit Score falls between any two such scores, the applicable Industry Diversity Scoreshall be the lower of the two Industry Diversity Scores:
AggregateIndustry
EquivalentUnit Score
IndustryDiversity
Score
AggregateIndustry
EquivalentUnit Score
IndustryDiversity
Score
AggregateIndustry
EquivalentUnit Score
IndustryDiversity
Score
AggregateIndustry
EquivalentUnit Score
IndustryDiversity
Score
0.0000 0.0000 5.0500 2.7000 10.1500 4.0200 15.2500 4.53000.0500 0.1000 5.1500 2.7333 10.2500 4.0300 15.3500 4.54000.1500 0.2000 5.2500 2.7667 10.3500 4.0400 15.4500 4.55000.2500 0.3000 5.3500 2.8000 10.4500 4.0500 15.5500 4.56000.3500 0.4000 5.4500 2.8333 10.5500 4.0600 15.6500 4.57000.4500 0.5000 5.5500 2.8667 10.6500 4.0700 15.7500 4.58000.5500 0.6000 5.6500 2.9000 10.7500 4.0800 15.8500 4.59000.6500 0.7000 5.7500 2.9333 10.8500 4.0900 15.9500 4.60000.7500 0.8000 5.8500 2.9667 10.9500 4.1000 16.0500 4.61000.8500 0.9000 5.9500 3.0000 11.0500 4.1100 16.1500 4.62000.9500 1.0000 6.0500 3.0250 11.1500 4.1200 16.2500 4.63001.0500 1.0500 6.1500 3.0500 11.2500 4.1300 16.3500 4.64001.1500 1.1000 6.2500 3.0750 11.3500 4.1400 16.4500 4.65001.2500 1.1500 6.3500 3.1000 11.4500 4.1500 16.5500 4.66001.3500 1.2000 6.4500 3.1250 11.5500 4.1600 16.6500 4.67001.4500 1.2500 6.5500 3.1500 11.6500 4.1700 16.7500 4.68001.5500 1.3000 6.6500 3.1750 11.7500 4.1800 16.8500 4.69001.6500 1.3500 6.7500 3.2000 11.8500 4.1900 16.9500 4.70001.7500 1.4000 6.8500 3.2250 11.9500 4.2000 17.0500 4.71001.8500 1.4500 6.9500 3.2500 12.0500 4.2100 17.1500 4.7200
SCH. 3- 1USActive 38876250.2
AggregateIndustry
EquivalentUnit Score
IndustryDiversity
Score
AggregateIndustry
EquivalentUnit Score
IndustryDiversity
Score
AggregateIndustry
EquivalentUnit Score
IndustryDiversity
Score
AggregateIndustry
EquivalentUnit Score
IndustryDiversity
Score
1.9500 1.5000 7.0500 3.2750 12.1500 4.2200 17.2500 4.73002.0500 1.5500 7.1500 3.3000 12.2500 4.2300 17.3500 4.74002.1500 1.6000 7.2500 3.3250 12.3500 4.2400 17.4500 4.75002.2500 1.6500 7.3500 3.3500 12.4500 4.2500 17.5500 4.76002.3500 1.7000 7.4500 3.3750 12.5500 4.2600 17.6500 4.77002.4500 1.7500 7.5500 3.4000 12.6500 4.2700 17.7500 4.78002.5500 1.8000 7.6500 3.4250 12.7500 4.2800 17.8500 4.79002.6500 1.8500 7.7500 3.4500 12.8500 4.2900 17.9500 4.80002.7500 1.9000 7.8500 3.4750 12.9500 4.3000 18.0500 4.81002.8500 1.9500 7.9500 3.5000 13.0500 4.3100 18.1500 4.82002.9500 2.0000 8.0500 3.5250 13.1500 4.3200 18.2500 4.83003.0500 2.0333 8.1500 3.5500 13.2500 4.3300 18.3500 4.84003.1500 2.0667 8.2500 3.5750 13.3500 4.3400 18.4500 4.85003.2500 2.1000 8.3500 3.6000 13.4500 4.3500 18.5500 4.86003.3500 2.1333 8.4500 3.6250 13.5500 4.3600 18.6500 4.87003.4500 2.1667 8.5500 3.6500 13.6500 4.3700 18.7500 4.88003.5500 2.2000 8.6500 3.6750 13.7500 4.3800 18.8500 4.89003.6500 2.2333 8.7500 3.7000 13.8500 4.3900 18.9500 4.90003.7500 2.2667 8.8500 3.7250 13.9500 4.4000 19.0500 4.91003.8500 2.3000 8.9500 3.7500 14.0500 4.4100 19.1500 4.92003.9500 2.3333 9.0500 3.7750 14.1500 4.4200 19.2500 4.93004.0500 2.3667 9.1500 3.8000 14.2500 4.4300 19.3500 4.94004.1500 2.4000 9.2500 3.8250 14.3500 4.4400 19.4500 4.95004.2500 2.4333 9.3500 3.8500 14.4500 4.4500 19.5500 4.96004.3500 2.4667 9.4500 3.8750 14.5500 4.4600 19.6500 4.97004.4500 2.5000 9.5500 3.9000 14.6500 4.4700 19.7500 4.98004.5500 2.5333 9.6500 3.9250 14.7500 4.4800 19.8500 4.99004.6500 2.5667 9.7500 3.9500 14.8500 4.4900 19.9500 5.00004.7500 2.6000 9.8500 3.9750 14.9500 4.50004.8500 2.6333 9.9500 4.0000 15.0500 4.51004.9500 2.6667 10.0500 4.0100 15.1500 4.5200
The Diversity Score is then calculated by summing each of the Industry(f)Diversity Scores for each Moody’s industry classification group shown on Schedule 1.
For purposes of calculating the Diversity Score, affiliated issuers in the same Industry aredeemed to be a single issuer except as otherwise agreed to by Moody’s and collateralized loanobligations shall not be included.
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SCHEDULE 4
MOODY’S RATING DEFINITIONS
MOODY’S DEFAULT PROBABILITY RATING
if the obligorwith respect to a Collateral Obligation (other than a DIP (a)Collateral Obligation), if the Obligor of such Collateral Obligation has a CFR, then suchCFR;
with respect to a Collateral Obligation (other than a DIP Collateral (b)Obligation) if not determined pursuant to clause (a) above, if the obligorObligor of suchCollateral Obligation has one or more senior unsecured obligations with an AssignedMoody’s Rating, then the Assigned Moody’s Rating on any such obligation as selectedby the Investment Manager in its sole discretion;
with respect to a Collateral Obligation (other than a DIP Collateral (c)Obligation) if not determined pursuant to clause (a) or (b) above, if the obligorObligor ofsuch Collateral Obligation has one or more senior secured obligations with an AssignedMoody’s Rating, then the Moody’s rating that is one subcategory lower than theAssigned Moody’s Rating on any such senior secured obligation as selected by theInvestment Manager in its sole discretion;
with respect to a Collateral Obligation (other than a DIP Collateral (d)Obligation) if not determined pursuant to clause (a), (b) or (c) above, if a rating or ratingestimate has been assigned to such Collateral Obligation by Moody’s upon the request ofthe Issuer, the Investment Manager or an Affiliate of the Investment Manager, such rating or, in the case of a rating estimate, the applicable rating estimate for such obligation sothen the Moody’s Default Probability Rating is such rating estimate as longas such rating estimate or a renewal for such rating estimate has been issued or providedby Moody’s in each case within the fifteen (15) month period preceding the date onwhich athe Moody’s Default Probability Rating is being determined;
(e) if not determined pursuant to any of clauses (a) through (d) above and at the election of the Investment Manager, the Moody’s Derived Rating; and
(f) if not determined pursuant to clause (a) through (e) above, “Caa3”;provided that notwithstanding the methodology above, if a Collateral Obligation is a DIP Collateral Obligation, the Moody’s Default Probability Rating will be the rating that is one subcategory below the Assigned Moody’s Rating of such DIP Collateral Obligation; provided further, that, each applicable rating, at the time of calculation, (i) on credit watch by Moody’s with positive implications will be treated as having been upgraded by one rating subcategory, and (ii) on credit watch by Moody’s with negative implications will be treated as having been downgraded by one rating subcategory. provided that if such rating estimate has been issued or provided by Moody’s for a period (x) longer than thirteen (13) months but not beyond fifteen (15) months, the Moody’s Default Probability Rating will be one subcategory lower than such rating estimate and
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(y) beyond fifteen (15) months, the Moody’s Default Probability Rating will be deemed to be “Caa3”;
if such Collateral Obligation is a DIP Collateral Obligation, the Moody’s (e)Derived Rating set forth in clause (a) in the definition thereof;
with respect to a Collateral Obligation if not determined pursuant to any of (f)clauses (a) through (e) above and at the election of the Investment Manager, the Moody’s Derived Rating; and
with respect to a Collateral Obligation if not determined pursuant to any of (g)clauses (a) through (f) above, the Collateral Obligation will be deemed to have a Moody’s Default Probability Rating of “Caa3”.
To the extent that the Issuer relies upon a credit estimate for purposes of the Moody’s Default Probability Rating of any Collateral Obligation, the Investment Manager (on behalf of the Issuer) will apply for renewal of such credit estimate on an annual basis.
“CFR” means, with: With respect to the obligoran Obligor of anya CollateralObligation, theif such Obligor has a corporate family rating assigned to such obligor byMoody’s, then such corporate family rating; provided, that if any obligor of any Collateral Obligationsuch Obligor does not have a corporate family rating by Moody’s but anotheranyentity in such obligorthe Obligor’s corporate family does have a corporate family rating by Moody’s, then the CFR is such corporate family rating of such other entity will be the CFR for the obligor of such Collateral Obligation.
MOODY’S DERIVED RATING
With respect to a Collateral Obligation whose Moody’s Rating or Moody’sDefault Probability Rating cannot otherwise beis determined pursuant toas the definitions thereof, such Moody’s Derived Rating or, the rating as determined as set forth below:
(a) with respect to any DIP Collateral Obligation, the Moody’s DefaultProbability Rating as determined in the manner set forth below:of such Collateral Obligation shall be the rating which is one subcategory below the facility rating (whether public or private) of such DIP Collateral Obligation rated by Moody’s;
(a) (b) if not determined pursuant to clause (a) above, by using one of themethods provided below:
if such Collateral Obligation has a public and monitored rating by S&P, pursuant(i)to the table below:
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Type of CollateralObligation
S&P Rating (Publicand Monitored)
CollateralObligation Rated by
S&P
Number ofSubcategories
Relative to Moody’sEquivalent of S&P
Rating
Not StructuredFinance Obligation
≥ “BBB-“Not a Loan or
Participation Interestin Loan
-1
Not StructuredFinance Obligation
≤” BB+”Not a Loan or
Participation Interestin Loan
-2
Not StructuredFinance Obligation
N/ALoan or Participation
Interest in Loan-2
if suchin the event that the Collateral Obligation isdoes not rated byhave an S&P (ii)rating, but another security or obligation of the obligor has a public and monitored rating by S&P (a “parallel security”), then the rating of such parallel security will at the election of the Investment Manager be determined in accordance with the table set forth in subclause (a)(i) above, and the Moody’s Derived Rating for purposes of the definitions of Moody’s Rating and Moody’s Default Probability Rating (as applicable)Obligor is publicly rated by S&P, then the Moody’s Derived Rating of such Collateral Obligationwill be determined in accordance with the methodology set forth in the following table (for such purposes treating the parallel security as if it were rated by Moody’s at the rating determined pursuant to this subclause (b)(ii)):
Obligation Categoryof Rated ObligationRating of
Rated Obligation
Number of SubcategoriesRelative to Rated Obligation
RatingSenior secured obligation greater than or equal to B2 -1
Senior securedUnsecuredobligation
less than B2 20
Subordinated obligation greater than or equal to B3 +1Subordinated obligation less than B3 0
if such Collateral Obligation is a DIP Collateral Obligation, no Moody’s Derived(iii)Rating may be determined based on a rating by S&P or any other rating agency;
provided, that the Aggregate Principal Balanceaggregate principal balance of the CollateralObligations that may have a Moody’s Rating derived from an S&P Rating as set forth insub-clauses (i) or (ii) of this clause (ab) may not exceed 10% of the Collateral PrincipalAmount.;
(b) Ifif not determined pursuant to clauseclauses (a) or (b) above and such(c)Collateral Obligation is not rated by Moody’s or S&P and no other security or obligation of theissuer of such Collateral Obligation is rated by Moody’s or S&P, and if Moody’s has beenrequested by the Issuer, the Investment Manager or the issuer of such Collateral Obligation to
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assign a rating or rating estimate with respect to such Collateral Obligation but such rating orrating estimate has not been received, pending receipt of such estimate, the Moody’s DerivedRating of such Collateral Obligation for purposes of the definitions of Moody’s Rating orMoody’s Default Probability Rating of such Collateral Obligation shall be (i) “”B3” if theInvestment Manager certifies to the Trustee and the Collateral Administrator that the InvestmentManager believes that such estimate shall be at least “B3” and if the Aggregate PrincipalBalance of Collateral Obligations determined pursuant to this clause (bc)(i) and clause (a) abovedoes not exceed 5% of the Collateral Principal Amount or (ii) otherwise, “Caa1.”; and
For purposes of calculating a Moody’s Derived Rating, each applicable rating, at the time of calculation, (i) on credit watch by Moody’s with positive implications will be treated as having been upgraded by one rating subcategory and (ii) on credit watch by Moody’s with negative implications will be treated as having been downgraded by one rating subcategory.
if not determined pursuant to clauses (a), (b) or (c) above, the Moody’s (d)Derived Rating of such Collateral Obligation shall be “Caa3”.
To the extent that the Issuer relies upon a credit estimate for purposes of the Moody’s Derived Rating of any Collateral Obligation, the Investment Manager (on behalf of the Issuer) will apply for renewal of such credit estimate on an annual basis.
MOODY’S SENIOR SECURED LOANRATING
A loan that
With respect to any Collateral Obligation, as of any date of determination, the rating determined in accordance with the following methodology:
with respect to a Collateral Obligation that is a Senior Secured Loan:(a)
if such Collateral Obligation has an Assigned Moody’s Rating, (i)then such Assigned Moody’s Rating;
if such Collateral Obligation does not have an Assigned Moody’s (ii)Rating but the Obligor of such Collateral Obligation has a CFR, then the Moody’s rating is one subcategory higher than such CFR;
if neither clause (i) nor (ii) above apply, if such Collateral (iii)Obligation does not have an Assigned Moody’s Rating but the Obligor of such Collateral Obligation has one or more senior unsecured obligations with an Assigned Moody’s Rating, then the Moody’s rating that is two subcategories higher than the Assigned Moody’s Rating on any such obligation as selected by the Investment Manager in its sole discretion;
if none of clauses (i) through (iii) above apply, at the election of (iv)the Investment Manager, the Moody’s Derived Rating; and
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if none of clauses (i) through (iv) above apply, the Collateral (v)Obligation will be deemed to have a Moody’s Rating of “Caa3”; and
with respect to a Collateral Obligation other than a Senior Secured Loan:(b)
is not (and cannot by its terms become) subordinate in right of (i)payment to any other debt obligation of the Obligor of the loan;if such Collateral Obligation has an Assigned Moody’s Rating, such Assigned Moody’s Rating;
(x) is secured by a valid first priority perfected security interest or (ii)lien in, to or on specified collateral securing the Obligor’s obligations under the loan and (y) such specified collateral does not consist entirely of equity securities or common stock; provided that any loan that would be considered a Moody’s Senior Secured Loan but for clause (y) above shall be considered a Moody’s Senior Secured Loan if it is a loan made to a parent entity and as to which the Investment Manager determines in good faith that the value of the common stock of the subsidiary (or other equity interests in the subsidiary) securing such loan at or about the time of acquisition of such loan by the Issuer has a value that is at least equal to the outstanding principal balance of such loan and the outstanding principal balances of any other obligations of such parent entity that are pari passu with such loan, which value may include, among other things, the enterprise value of such subsidiary of such parent entity; andif such Collateral Obligation does not have an Assigned Moody’s Rating but the Obligor of such Collateral Obligation has one or more senior unsecured obligations with an Assigned Moody’s Rating, then the Assigned Moody’s Rating on any such obligation as selected by the Investment Manager in its sole discretion;
the value of the collateral securing the loan together with other (iii)attributes of the Obligor (including, without limitation, its general financial condition, ability to generate cash flow available for debt service and other demands for that cash flow) is adequate (in the commercially reasonable judgment of the Investment Manager) to repay the loan in accordance with its terms and to repay all other loans of equal seniority secured by a first lien or security interest in the same collateral.if neither clause (i) nor (ii) above apply, if such Collateral Obligation does not have an Assigned Moody’s Rating but the Obligor of such Collateral Obligation has a CFR, then the Moody’s rating that is one subcategory lower than such CFR;
if none of clauses (i), (ii) or (iii) above apply, if such Collateral (iv)Obligation does not have an Assigned Moody’s Rating but the Obligor of such Collateral Obligation has one or more subordinated debt obligations with an Assigned Moody’s Rating, then the Moody’s rating that is one subcategory higher than the Assigned Moody’s Rating on any such obligation as selected by the Investment Manager in its sole discretion; and
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if none of clauses (i) through (iv) above apply, the Collateral (v)Obligation will be deemed to have a Moody’s Rating of “Caa3”.
With respect to any credit estimate assigned by Moody’s to a Collateral Obligation hereunder, the Issuer (or the Investment Manager on the Issuer’s behalf shall send to Moody’s the related Obligor’s updated financial information upon receipt thereof from such Obligor and will use commercially reasonable efforts to obtain such information at least (x) annually and (y) upon any significant change in the financial condition of such Obligor (as determined by the Investment Manager in its commercially reasonable business judgment) but (in each case) only to the extent such Obligor is required to provide it pursuant to the Underlying Instruments.
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SCHEDULE 5
FITCH RATING DEFINITIONS
FITCH RATINGS DEFINITIONS
“Fitch CDS Implied Rating”: The Fitch CDS Implied Rating specified by Fitch in accordance with the Fitch Portfolio Credit Model available in the reference entity feed at www.fitchratings.com, as the same may be updated by Fitch from time to time.“Fitch Rating”: TheRating”: As of any date of determination, the Fitch Rating of any Collateral Obligationshallwill be determined as follows:
if Fitch has issued an issuer default rating with respect to the issuer of(a)such Collateral Obligation, or the guarantor which unconditionally and irrevocablyguarantees such Collateral Obligation, then the Fitch Rating shallwill be such issuerdefault rating (regardless of whether there is a published rating by Fitch on the CollateralObligations of such issuer held by the Issuer);
if Fitch has not issued an issuer default rating with respect to the issuer or(b)guarantor of such Collateral Obligation but Fitch has issued an outstanding long--termfinancial strength rating with respect to such issuer, the Fitch Rating of such CollateralObligation shallwill be one sub--category below such rating;
subject to the proviso below,if a Fitch Rating cannot be determined(c)pursuant to clause (a) or (b), but
Fitch has issued a senior unsecured rating on any obligation or(i)security of the issuer of such Collateral Obligation, then the Fitch Rating of suchCollateral Obligation shallwill equal such rating; or
Fitch has not issued a senior unsecured rating on any obligation or(ii)security of the issuer of such Collateral Obligation but Fitch has issued a seniorrating, senior secured rating or a subordinated secured rating on any obligation orsecurity of the issuer of such Collateral Obligation, then the Fitch Rating of suchCollateral Obligation shallwill (x) equal such rating if such rating is “BBB--” orhigher and (y) be one sub--category below such rating if such rating is “BB+” orlower,; or
Fitch has not issued a senior unsecured rating or a senior rating,(iii)senior secured rating or a subordinated secured rating on any obligation orsecurity of the issuer of such Collateral Obligation but Fitch has issued asubordinated, junior subordinated or senior subordinated rating on any obligationor security of the issuer of such Collateral Obligation, then the Fitch Rating ofsuch Collateral Obligation shallwill be (x) one sub--category above such rating ifsuch rating is “B+” or higher and (y) two sub--categories above such rating ifsuch rating is “B” or lower;
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subject to the proviso below, if a Fitch Rating cannot be determined(d)pursuant to clause (a), (b) or (c) and
Moody’s has issued a publicly available corporate family rating for(i)the issuer of such Collateral Obligation, then, subject to subclausesub-clause (viii)below, the Fitch Rating of such Collateral Obligation shallwill be the Fitchequivalent of such Moody’s rating;
Moody’s has not issued a publicly available corporate family(ii)rating for the issuer of such Collateral Obligation but has issued a publicly available long--term issuer rating for such issuer, then, subject tosubclausesub-clause (viii) below, the Fitch Rating of such Collateral Obligationshallwill be the Fitch equivalent of such Moody’s rating;
Moody’s has not issued a publicly available corporate family(iii)rating for the issuer of such Collateral Obligation but Moody’s has issued ana publicly available and outstanding insurance financial strength rating for suchissuer, then, subject to subclausesub-clause (viii) below, the Fitch Rating of suchCollateral Obligation shallwill be one sub--category below the Fitch equivalent ofsuch Moody’s rating;
Moody’s has not issued a publicly available corporate family(iv)rating for the issuer of such Collateral Obligation but has issued a publicly available and outstanding corporate issue ratings for such issuer, then, subject tosubclausesub-clause (viii) below, the Fitch Rating of such Collateral Obligationshallwill be (x) if such publicly available corporate issue rating relates to seniorunsecured obligations of such issuer, the Fitch equivalent of the Moody’s ratingfor such issue, or if there is no such publicly available corporate issue ratingsrelating to senior unsecured obligations of the issuer then (y) if such publicly available corporate issue rating relates to senior, senior secured or subordinatedsecured obligations of such issuer, (1) one sub--category below the Fitchequivalent of such Moody’s rating if such obligations are rated “Ba1” or above or“Ca” by Moody’s or (2) two sub--categories below the Fitch equivalent of suchMoody’s rating if such obligations are rated “Ba2” or below but above “Ca” byMoody’s, or if there is no such publicly available corporate issue ratings relatingto senior unsecured, senior, senior secured or subordinated secured obligations ofthe issuer then (z) if such publicly available corporate issue rating relates tosubordinated, junior subordinated or senior subordinated obligations of suchissuer, (1) one sub--category above the Fitch equivalent of such Moody’s rating ifsuch obligations are rated “B1” or above by Moody’s or (2) two sub--categoriesabove the Fitch equivalent of such Moody’s rating if such obligations are rated“B2” or below by Moody’s;
S&P has issued a publicly available issuer credit rating for the(v)issuer of such Collateral Obligation, then, subject to subclausesub-clause (viii)
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below, the Fitch Rating of such Collateral Obligation shallwill be the Fitchequivalent of such S&P rating;
S&P has not issued a publicly available issuer credit rating for the(vi)issuer of such Collateral Obligation but S&P has issued ana publicly available andoutstanding insurance financial strength rating for such issuer, then, subject tosubclausesub-clause (viii) below, the Fitch Rating of such Collateral Obligationshallwill be one sub--category below the Fitch equivalent of such S&P rating;
S&P has not issued a publicly available issuer credit rating for the(vii)issuer of such Collateral Obligation but has issued publicly available andoutstanding corporate issue ratings for such issuer, then, subject tosubclausesub-clause (viii) below, the Fitch Rating of such Collateral Obligationshallwill be (x) if such publicly available corporate issue rating relates to seniorunsecured obligations of such issuer, the Fitch equivalent of the S&P rating forsuch issue, if there is no such publicly available corporate issue ratings relating tosenior unsecured obligations of the issuer then (y) if such publicly availablecorporate issue rating relates to senior, senior secured or subordinated securedobligations of such issuer, (1) the Fitch equivalent of such S&P rating if suchobligations are rated “BBB--” or above by S&P or (2) one sub--category belowthe Fitch equivalent of such S&P rating if such obligations are rated “BB+” orbelow by S&P, or if there is no such publicly available corporate issue ratingsrelating to senior unsecured, senior, senior secured or subordinated securedobligations of the issuer then (z) if such publicly available corporate issue ratingrelates to subordinated, junior subordinated or senior subordinated obligations ofsuch issuer, (1) one sub--category above the Fitch equivalent of such S&P ratingif such obligations are rated “B+” or above by S&P or (2) two sub--categoriesabove the Fitch equivalent of such S&P rating if such obligations are rated “B” orbelow by S&P; and
both Moody’s and S&P provide a public rating of the issuer of(viii)such Collateral Obligation or a corporate issue of such issuer, then the FitchRating shallwill be the lowest of the Fitch Ratings determined pursuant to any ofthe subclausessub-clauses of this clause (d).
if a rating cannot be determined pursuant to clauses (a) through (d) then,(e)(i) at the discretion of the InvestmentPortfolio Manager, the InvestmentPortfolioManager on behalf of the Issuer may apply to Fitch for a Fitch shadow credit opinion,and the issuer default rating provided in connection with such rating shallwill then be theFitch Rating, or (ii) the Issuer may assign a Fitch Rating of “CCC” or lower to suchCollateral Obligation which is not in default;
provided that on the Closing Date, if any rating described above is (i) on rating watch negative or negative credit watch, the rating shall be the lower of (A) the Fitch CDS IR (if such rating is available) or (B) the Fitch Rating as determined above adjusted down by one subcategory, (ii) on outlook negative, the rating shall be the lower of (A) the Fitch CDS IR (if such rating is available) or (B) the Fitch Rating as determined above, or (iii) on rating watch positive or
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positive credit watch, the rating shall not be adjusted; provided, further, that after the ClosingDate, if any rating described above is on rating watch negative or negative credit watch, therating shallwill be adjusted down by one subcategorysub-category; provided, further, that theFitch Rating may be updated by Fitch from time to time as indicated in the “Global Rating Criteria for CLOs and Corporate CDOs” report issued by Fitch and available atwww.fitchratings.com; provided, further, that if the Fitch Rating determined pursuant to any of clauses (a) through (e) above would cause the Collateral Obligation to be a Defaulted Obligation pursuant to clause (d) of the definition of “Defaulted Obligation” due to the Fitch, S&P or Moody’s rating such Fitch Rating is based being adjusted down one or more sub-categories, the Fitch Rating of such Collateral Obligation shall be the Fitch, S&P or Moody’s rating such Fitch Rating was based on without making such adjustment. For the avoidance of doubt, the FitchRating takes into account adjustments for assets that are on rating watch negative or negativecredit watch, as well as outlook negative outlook prior to determining the issue rating and/or inthe determination of the lower of the Moody’s and S&P rating public ratings.
Fitch Equivalent Ratings
Fitch Equivalent RatingsFitch Rating Moody’s rating S&P rating
AAA Aaa AAAAA+ Aa1 AA+AA Aa2 AAAA- Aa3 AA-A+ A1 A+A A2 AA- A3 A-
BBB+ Baa1 BBB+BBB Baa2 BBBBBB- Baa3 BBB-BB+ Ba1Bal BB+BB Ba2 BBBB- Ba3 BB-B+ B-1 B+B B-2 BB- B3 B-
CCC+ Caa1 CCC+CCC Caa2 CCCCCC- Caa3 CCC-CC Ca CCC C C
SCH. 5- 4USActive 38876250.2
Fitch IDRFitch Issuer Default Rating (IDR) Equivalency Map from Corporate Ratings
Rating Type Rating Agency(s) Issue Rating Mapping RuleCorporate Family Rating LT
Issuer RatingMoody’s NA 0
Issuer Credit Rating S&P NA 0
Senior unsecured Fitch, Moody’s, S&P Any 0
Senior, Senior secured orSubordinated secured
Fitch, S&P “BBB-“” or above 0
Fitch, S&P “BB+” or below -1Moody’s “Ba1Bal” or above -1Moody’s “Ba2” or below -2Moody’s “Ca” -1
Subordinated, Junior subordinatedor Senior subordinated
Fitch, Moody’s, S&P “B+’, ‘” “B1’” orabove
1
Fitch, Moody’s, S&P “B”,” “B2” or below 2
The following steps are used to calculate the Fitch IDR equivalent ratings:
1. Public or private Fitch-issued IDR.(1)
2. If Fitch has not issued an IDR, but has an outstanding Long-Term (2)Financial Strength Ratinglong-term financial strength rating, then the IDRequivalent is one rating lower.
3. If Fitch has not issued an IDR, but has outstanding corporate issue(3)ratings, then the IDR equivalent is calculated using the mapping in thetable above.
4. If Fitch does not rate the issuer or any associated issuance, then(4)determine a Moody’s and S&P equivalent to Fitch’s IDR pursuant to steps5 and 6.
5(a.) A public Moody’s-issued Corporate Family Rating (CFR) is(5)equivalent in definition terms to the Fitch IDR. If Moody’s has not issueda CFR, but has an outstanding LT issuer Rating, then this is equivalent tothe Fitch IDR.
5(b.) If Moody’s has not issued a CFR, but has an outstanding Insurance Financial Strength Ratinginsurance financial strength rating, then the FitchIDR equivalent is one rating lower.
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5(c.) If Moody’s has not issued a CFR, but has outstanding corporateissue ratings, then the Fitch IDR equivalent is calculated using themapping in the table above.
6(a.) A public S&P-issued Issuer Credit Rating (ICR) is equivalent in(6)terms of definition to the Fitch IDR.
6(b.) If S&P has not issued an ICR, but has an outstanding Insurance Financial Strength Ratinginsurance financial strength rating, then the FitchIDR equivalent is one rating lower.
6(c.) If S&P has not issued an ICR, but has outstanding corporate issueratings, then the Fitch IDR equivalent is calculated using the mapping inthe table above.
7. If both Moody’s and S&P provide a public rating on the issuer or(7)an issue, the lower of the two Fitch IDR equivalent ratings will be used inPCMPortfolio Credit Model. Otherwise the sole public Fitch IDRequivalent rating from Moody’s or S&P will be applied.
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5
SCHEDULE I
Additional Addressees
Issuer: THL Credit Wind River 2014-2 CLO Ltd. c/o MaplesFS Limited P.O. Box 1093 Boundary Hall, Cricket Square Grand Cayman KY1-1102 Cayman Islands Attention: The Directors Fax: +1 (345) 945-7100 Co-Issuer: THL Credit Wind River 2014-2 CLO LLC c/o Puglisi & Associates 850 Library Avenue, Suite 204 Newark, Delaware 19711 Investment Manager: THL Credit Advisors LLC 222 W. Adams Street, Suite 2160 Chicago, Illinois 60606 Attention: Mr. Robert Hickey Phone: (630) 320-7842 Fax: (732) 380-3337 Rating Agencies: Moody’s Investors Service, Inc. 7 World Trade Center 250 Greenwich Street New York, New York 10007 Attention: CBO/CLO Monitoring E-mail: [email protected] Fitch Ratings, Inc. [email protected]
Irish Stock Exchange: Electronic copy to be uploaded to the Irish Stock Exchange website via http://www.isedirect.ie DTC, Euroclear and Clearstream (as applicable): [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] 17g5: [email protected]
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