Exhibit 10.4
AMENDED AND RESTATED
PROMISSORY NOTE

      $350,000,000   Dated August 10, 2010     Valencia, California

     This Amended and Restated Promissory Note (this “Amended Note”), dated as
of August 10, 2010, amends, re-evidences, restates, and supersedes in full, but
does not in any way satisfy nor discharge the outstanding indebtedness, if any,
owed under that certain Promissory Note dated February 26, 2009 in the original
principal amount of Three Hundred and Fifty Million Dollars ($350,000,000), made
by the undersigned in favor of The Mann Group LLC (the “Original Note”). The
Original Note, as amended, re-evidenced, and restated by this Amended Note, is
referred to herein as the “Note.”
 
     For Value Received, MannKind Corporation, a Delaware corporation
(“Borrower”), hereby promises to pay to the order of The Mann Group LLC
(“Lender”), in lawful money of the United States of America and in immediately
available funds, the principal sum of up to Three Hundred and Fifty Million
Dollars ($350,000,000) or the aggregate principal amount of all Advances (as
defined below) made hereunder, whichever is less (the “Loan”) together with
accrued and unpaid interest thereon, each due and payable on the dates and in
the manner set forth below.
     1. Principal Repayment. The outstanding principal amount of each Advance
together with all accrued and unpaid interest thereon shall be due and payable
on December 31, 2012 (the “Maturity Date”).
     2. Interest Rate. Borrower further promises to pay interest on the
outstanding principal amount of each Advance from the date thereof until payment
in full, which interest shall be payable at a rate equal to the one year London
Interbank Offered Rate (LIBOR) reported by the Wall Street Journal (or a
comparable periodical if such periodical is no longer published) on the day of
such Advance plus 3% per annum, or the maximum rate permissible by law (which
under the laws of the State of California shall be deemed to be the laws
relating to permissible rates of interest on commercial loans), whichever is
less. Interest shall be due and payable quarterly in arrears not later than the
first day of each calendar quarter for the preceding quarter, commencing on the
first day of the calendar quarter following the calendar quarter in which an
Advance is made, and shall be calculated on the basis of a 365/366-day year for
the actual number of days elapsed.
     3. Place of Payment. All amounts payable hereunder shall be payable in
lawful money of the United States of America at the office of Lender, 28903
North Avenue Paine, Valencia, CA 91355, unless another place of payment shall be
specified in writing by Lender.

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     4. Application of Payments; Prepayment.
          4.1 Payment on this Note shall be applied first to accrued interest,
and thereafter to the outstanding principal balance hereof.
          4.2 This Note may be prepaid in whole or in part without penalty or
premium. Any amount prepaid pursuant to this Section 4.2 may be reborrowed
subject to Section 5 hereof. Any partial prepayment made pursuant to this
Section 4.2 shall be applied to interest first and then to principal, and shall
be applied to the oldest outstanding Advance first. At the time of any
prepayment of principal hereunder, Borrower shall also pay all accrued and
unpaid interest on the amount prepaid through the date of prepayment.
          4.3 Pursuant to that certain Common Stock Purchase Agreement between
Borrower and Lender dated as of August 10, 2010 (the “Purchase Agreement”),
Lender has agreed to purchase from Borrower, and Borrower has agreed to issue
and sell to Lender, at the Per Share Purchase Price (as defined in the Purchase
Agreement) a certain number of shares of Borrower’s common stock, $0.01 par
value (the “Common Stock”), at each Closing (as defined in that certain Common
Stock Purchase Agreement between Borrower and Seaside 88, LP dated as of
August 10, 2010). At the time of each purchase and sale of shares of Common
Stock pursuant to the Purchase Agreement, Borrower shall cause its transfer
agent to deliver to Lender a certificate representing such shares against the
cancellation of indebtedness owed by Borrower under this Note, the amount of
such indebtedness cancelled to be equal to the number of shares of Common Stock
being sold at such time multiplied by the Per Share Purchase Price applicable to
such sale; provided, however, that the cancellation of indebtedness shall be
applied only to the outstanding principal balance under this Note and not to any
accrued interest; provided further, that if cancellation of the outstanding
principal balance under this Note is insufficient to pay the entire
consideration for the shares of Common Stock being sold at such time, Lender
shall pay the balance of the consideration in cash by wire transfer of
immediately available funds to an account designated by Borrower. In connection
with the cancellation of indebtedness, Lender shall record an appropriate
notation on Exhibit A to this Note to reflect such cancellation as a payment of
principal on this Note. The cancellation of principal indebtedness shall be
applied to the oldest outstanding Advance first. Borrower shall pay all accrued
and unpaid interest on each amount of the principal indebtedness that is
cancelled pursuant to this Section 4.3 at the next quarterly interest payment
date as provided in Section 2.
          4.4 At any time upon delivery of prior written notice (the “Call
Notice”), Lender may require Borrower to prepay Advances that have been
outstanding for more than twelve months as of the date of the notice. Lender may
not require Borrower to prepay Advances in an aggregate amount exceeding
$200,000,000 (less the aggregate amount of principal indebtedness cancelled
pursuant to Section 4.3) pursuant to this Section 4.4. If Lender exercises such
call right, Borrower shall, on the earlier of: (x) 90 days after delivery of the
Call Notice or (y) the Maturity Date, prepay the Advances in the amount set
forth in the Call Notice. Any partial prepayment made pursuant to this
Section 4.4 shall be applied to interest first and then to principal. At the
time of any prepayment of principal hereunder, Borrower shall also pay all
accrued and unpaid interest on the amount prepaid through the date of
prepayment.

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     5. Loan Requests. Provided that no Event of Default has occurred and is
continuing, from and after the date hereof and through and including
December 31, 2011, Lender shall make available to Borrower for borrowings by
Borrower from time to time a principal amount of Three Hundred and Fifty Million
Dollars ($350,000,000) less the aggregate amount of principal indebtedness
cancelled pursuant to Section 4.3 (each, an “Advance”). Whenever Borrower
desires an Advance hereunder, Borrower shall notify Lender by facsimile with a
transmission confirmation or by electronic mail as long as a read receipt is
requested and received no later than 4:00 p.m. Pacific time, sixty (60) calendar
days prior to the date on which the Advance is requested to be made. At the time
of any Advance (or at the time of receipt of any payment of principal), Lender
shall make or cause to be made, an appropriate notation on the Exhibit A
attached hereto reflecting the amount of such Advance (or the amount of such
payment). The outstanding amount of this Note set forth on such Exhibit A shall
be prima facie evidence of the principal amount thereof outstanding, but the
failure to record, or any error in so recording, shall not limit or otherwise
affect the obligations of Borrower to make payments of principal of or interest
on this Note when due.
     6. Representations and Warranties. The Borrower hereby represents and
warrants to the Lender as follows:
          6.1 The Borrower has the requisite power and authority to enter into
this Note and to consummate the transactions contemplated hereby. The execution
and delivery of this Note by the Borrower and the consummation by the Borrower
of the transactions contemplated hereby have been duly authorized by all
necessary corporate action on the part of the Borrower. This Note has been duly
executed and delivered by the Borrower and constitutes the legal, valid and
binding agreement of the Borrower enforceable against the Borrower in accordance
with its terms, except as may be limited by (i) applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally and (ii) equitable
principles of general applicability relating to the availability of specific
performance, injunctive relief or other equitable remedies.
          6.2 No consent, approval, authorization, order, license, registration
or qualification of or with any Governmental Entity is required for the
execution and delivery by the Borrower of this Note or the transactions
contemplated hereby, except such consents, approvals, authorizations, orders,
licenses, registrations or qualifications as have been obtained, or which, if
not obtained, would not, individually or in the aggregate, have a material
adverse effect on the ability of the Borrower to perform its obligations
hereunder or consummate the transactions contemplated hereby on a timely basis.
As used in this Note, the term “Governmental Entity” means any agency, bureau,
commission, authority, department, official, political subdivision, tribunal or
other instrumentality of any government, whether (i) regulatory, administrative
or otherwise (including, without limitation, a self-regulatory organization or
stock exchange); (ii) federal, state or local; or (iii) domestic or foreign.
          6.3 The execution and delivery by the Borrower of this Note, the
performance by the Borrower of its obligations hereunder, and the consummation
by the Borrower of the transactions contemplated hereby, will not conflict with
or result in a breach or violation of (i) any of the terms or provisions of, or
constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,

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amendment, acceleration or cancellation of, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Borrower or
any of its subsidiaries is a party or by which the Borrower or any of its
subsidiaries is bound or to which any of their property or assets is subject or
(ii) any applicable law or statute or any order, rule or regulation of any
Governmental Entity having jurisdiction over the Borrower or any of its
subsidiaries or any of their respective properties, except for in the case of
either clause (i) or (ii) such conflicts, breaches or violations that would not
prevent or delay the consummation of the transactions contemplated by this Note
or that would not be reasonably expected to have a material adverse effect on
the Borrower, nor will any such action result in any violation of the provisions
of the organizational documents of the Borrower.
     7. Default. Each of the following events shall be an “Event of Default”
hereunder:
          (a) Borrower fails to pay timely any of the principal amount due under
this Note or any accrued interest or other amounts due under this Note on the
date the same becomes due and payable or within five (5) business days
thereafter;
          (b) Borrower files any petition or action for relief under any
bankruptcy, reorganization, insolvency or moratorium law or any other law for
the relief of, or relating to, debtors, now or hereafter in effect, or makes any
assignment for the benefit of creditors or takes any corporate action in
furtherance of any of the foregoing;
          (c) An involuntary petition is filed against Borrower (unless such
petition is dismissed or discharged within sixty (60) days) under any bankruptcy
statute now or hereafter in effect, or a custodian, receiver, trustee, assignee
for the benefit of creditors (or other similar official) is appointed to take
possession, custody or control of any property of Borrower; or
          (d) Any representation or warranty made herein or in any other
document delivered in connection herewith shall be incorrect or misleading in
any material respect when made or deemed made (except where any such
representation or warranty by the terms thereof is subject to a materiality
standard, in which case such representation or warranty shall be incorrect or
misleading in any respect).
Upon the occurrence of an Event of Default hereunder, all unpaid principal,
accrued interest and other amounts owing hereunder shall, at the option of
Lender, and, in the case of an Event of Default pursuant to (b) or (c) above,
automatically, be immediately due, payable and collectible by Lender pursuant to
applicable law, the commitment of the Lender to lend shall, at the option of the
Lender, and in the case of an Event of Default pursuant to (b) or (c) above,
automatically, terminate, and the interest rate applicable to outstanding
Advances upon an Event of Default shall increase to LIBOR calculated on the date
of the initial Advance or the date of the Event of Default (whichever is
greater) plus 5% per annum for the period after said Event of Default until
payment, or the maximum rate permissible by law as defined above, whichever is
less.
     8. Waiver. Borrower waives presentment and demand for payment, notice of
dishonor, protest and notice of protest of this Note, and shall pay all costs of
collection when incurred, including, without limitation, reasonable attorneys’
fees, costs and other expenses.

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     The right to plead any and all statutes of limitations as a defense to any
demands hereunder is hereby waived to the full extent permitted by law.
     9. Governing Law. This Note shall be governed by, and construed and
enforced in accordance with, the laws of the State of New York, excluding
conflict of laws principles that would cause the application of laws of any
other jurisdiction. Borrower consents to in personam jurisdiction of the courts
in the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York for any legal action or
proceeding with respect to this Note. Borrower, by execution and delivery of
this Note, hereby irrevocably accepts in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts.
     10. Successors and Assigns. This Note shall be binding upon and inure to
the benefit of the Borrower and Lender and their respective successors and
assigns; provided that the Borrower may not assign or otherwise transfer any of
its rights or obligations hereunder without the prior written consent of the
Lender. Lender may assign to one or more other persons all or a portion of its
rights (but not its obligations) under this Note with respect to all or a
portion of the Advances made by it.
     11. Integration. This Note (together with the Purchase Agreement) reflects
the entire understanding of the parties with respect to the transactions
contemplated hereby and shall not be contradicted or qualified by any other
agreement or instrument, oral or written, before or after the date hereof.
     12. Amendments, Modification, Etc. No amendment, modification or waiver of
any provision of this Note, and no consent to any departure by Lender or
Borrower and their assigns therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Lender and Borrower, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given.
     13. No Waiver. No failure on the part of the Lender to exercise, and no
delay in exercising, any right hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right under this Note preclude any
other or further exercise thereof or the exercise of any other right. The rights
of the Lender under this Note against Borrower are not conditional or contingent
on any attempt by the Lender to exercise any of its rights under this Note
against Borrower or any other person.
     14. Expenses. The Borrower agrees to reimburse, periodically and upon
request, and at the date of effectiveness of this Note or upon termination of
this Note, (i) the Lender’s reasonable expenses, including the reasonable fees
and disbursements of the Lender’s attorneys, arising in connection with the
preparation, negotiation, execution, delivery, amendment and administration of
this Note and related transactions and (ii) the Lender’s expenses, including the
fees and disbursements of the Lender’s attorneys, in connection with the
enforcement of this Note or the protection of the Lender’s rights under this
Note. In addition, the Borrower agrees to reimburse the Lender for all
reasonable expenses, including the reasonable fees and disbursements of the
Lender’s attorneys, incurred in connection with the licensing of the Lender as a
finance lender under the California Finance Lenders Law.

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     15. Indemnity. The Borrower shall indemnify, defend and hold harmless the
Lender and its agents and attorneys (collectively, the “Indemnitees”) from and
against (i) any and all transfer taxes, documentary taxes, assessments or
charges made by any Governmental Entity by reason of the execution and delivery
of this Note or the making of the Advances, and (ii) any and all liabilities,
losses, damages, penalties, judgments, claims, costs and expenses of any kind or
nature whatsoever (including reasonable attorneys’ fees, and disbursements in
connection with any actual or threatened investigative, administrative or
judicial proceeding, whether or not such Indemnitee shall be designated a party
thereto) that may be imposed on, incurred by or asserted against such
Indemnitee, in any manner relating to or arising out of this Note, the Advances
or the use or intended use of the proceeds of the Advances; provided that no
Indemnitee shall have the right to be indemnified or held harmless hereunder for
its own gross negligence or willful misconduct, as determined by a final
judgment of a court of competent jurisdiction.
     16. Seniority. Amounts due under this Note shall rank pari passu with all
of the Borrower’s other senior unsecured obligations, including the Borrower’s
3.75% Senior Convertible Notes due 2013.

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              Borrower:   MannKind Corporation
 
           
 
  By:   /s/ Matthew Pfeffer    
 
     
 
Matthew Pfeffer    
 
      Chief Financial Officer    
 
            Acknowledged and Agreed:   The Mann Group LLC
 
           
Lender:
  By:   /s/ Alfred E. Mann    
 
     
 
Alfred E. Mann    
 
      Managing Member    

Alfred E. Mann hereby affirms his intention that the Lender’s obligations
hereunder shall survive his death and be binding on his estate, the trustee of
any revocable trust he has established for estate planning purposes, and his
heirs and successors. Alfred E. Mann further represents, warrants and covenants
that he has not included and will not include any provision in any document he
has established for estate planning purposes that would defeat or purport to
defeat his obligations hereunder.

         
Acknowledged and Agreed:
  /s/ Alfred E. Mann    
 
 
 
Alfred E. Mann    

7.