EXHIBIT 10.217

INDENTURE

dated as of August 26, 2008

by and between

LEDGEMONT ROYALTY SUB LLC,

a Delaware limited liability company,

as issuer of the Notes described herein,

and

U.S. BANK NATIONAL ASSOCIATION,

as initial trustee of the Notes described herein

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Table of Contents

 

          Page

GRANTING CLAUSE

   1

HABENDUM CLAUSE

   2    ARTICLE I       GENERAL   

Section 1.1

   Rules of Construction and Defined Terms    3

Section 1.2

   Compliance Certificates and Opinions    3

Section 1.3

   Acts of Noteholders    4    ARTICLE II       THE NOTES   

Section 2.1

   Amount of Notes; Terms; Form; Execution and Delivery    5

Section 2.2

   Restrictive Legends    8

Section 2.3

   Registrar and Paying Agent    11

Section 2.4

   Paying Agent to Hold Money in Trust    12

Section 2.5

   Method of Payment    13

Section 2.6

   Minimum Denominations    15

Section 2.7

   Transfer and Exchange; Cancellation    15

Section 2.8

   Mutilated, Destroyed, Lost or Stolen Notes    16

Section 2.9

   Payments of Transfer Taxes    16

Section 2.10

   Book-Entry Provisions    17

Section 2.11

   Special Transfer Provisions    18

Section 2.12

   Temporary Definitive Notes    23

Section 2.13

   Statements to Noteholders    23

Section 2.14

   CUSIP, CINS, ISIN and Private Placement Numbers    24

Section 2.15

   Refinancing Notes    24

Section 2.16

   Class B Notes    26

Section 2.17

   Limitation on Number of Holders of Notes    27    ARTICLE III       ACCOUNTS;
PRIORITY OF PAYMENTS   

Section 3.1

   Establishment of Accounts    28

Section 3.2

   Investments of Cash    30

Section 3.3

   Closing Date Deposits; Withdrawals and Transfers    31

Section 3.4

   Capital Contributions    32

Section 3.5

   Calculation Date Calculations    32

Section 3.6

   Payment Date First Step Transfers    34

Section 3.7

   Payment Date Second Step Withdrawals    34

 

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Section 3.8

   Interest Reserve Account and Capital Account; Shortfalls    36

Section 3.9

   Redemptions    36

Section 3.10

   Procedure for Redemptions    37

Section 3.11

   Tax Distribution Escrow Account    38    ARTICLE IV       DEFAULT AND
REMEDIES   

Section 4.1

   Events of Default    39

Section 4.2

   Acceleration, Rescission and Annulment    41

Section 4.3

   Other Remedies    41

Section 4.4

   Limitation on Suits    43

Section 4.5

   Waiver of Existing Defaults    43

Section 4.6

   Restoration of Rights and Remedies    44

Section 4.7

   Remedies Cumulative    44

Section 4.8

   Authority of Courts Not Required    44

Section 4.9

   Rights of Noteholders to Receive Payment    44

Section 4.10

   Trustee May File Proofs of Claim    44

Section 4.11

   Undertaking for Costs    45

Section 4.12

   Control by Noteholders    45

Section 4.13

   Senior Trustee    45

Section 4.14

   Application of Proceeds    45

Section 4.15

   Waivers of Rights Inhibiting Enforcement    45

Section 4.16

   Security Interest Absolute    46    ARTICLE V       REPRESENTATIONS,
WARRANTIES AND COVENANTS   

Section 5.1

   Representations and Warranties    47

Section 5.2

   Covenants    50

Section 5.3

   Reports and Other Deliverables by the Issuer    57    ARTICLE VI       THE
TRUSTEE   

Section 6.1

   Acceptance of Trusts and Duties    58

Section 6.2

   Copies of Documents and Other Notices    58

Section 6.3

   Representations and Warranties    59

Section 6.4

   Reliance; Agents; Advice of Counsel    59

Section 6.5

   Not Acting in Individual Capacity    61

Section 6.6

   Compensation of Trustee    62

Section 6.7

   Notice of Defaults    62

Section 6.8

   May Hold Notes    62

Section 6.9

   Corporate Trustee Required; Eligibility    62

Section 6.10

   Reports by the Trustee    62

Section 6.11

   Calculation Agent    63

Section 6.12

   Pledge and Security Agreement and Other Deal Documents    63

Section 6.13

   Custody of the Collateral    63

Section 6.14

   Preservation and Disclosure of Noteholder Lists    63

 

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Section 6.15

   Audit Rights    64

Section 6.16

   Compliance with Applicable Anti-Terrorism and Anti-Money Laundering
Regulations    65

Section 6.17

   Jurisdiction of Trustee    65

Section 6.18

   Observer    65

Section 6.19

   Notice of Event of Default to Equityholders    66    ARTICLE VII      
SUCCESSOR TRUSTEES, REGISTRARS, PAYING AGENTS AND CALCULATION AGENTS   

Section 7.1

   Resignation and Removal of Trustee, Registrar, Paying Agent or Calculation
Agent    67

Section 7.2

   Appointment of Successor    67    ARTICLE VIII       INDEMNITY   

Section 8.1

   Indemnity    69

Section 8.2

   Noteholders’ Indemnity    69

Section 8.3

   Survival    69    ARTICLE IX       MODIFICATION   

Section 9.1

   Modification with Consent of Noteholders    70

Section 9.2

   Modification Without Consent of Noteholders    71

Section 9.3

   Subordination; Priority of Payments    72

Section 9.4

   Execution of Amendments by Trustee    72

Section 9.5

   Conformity with Trust Indenture Act    72    ARTICLE X       SUBORDINATION   

Section 10.1

   Subordination of the Notes    72    ARTICLE XI       DISCHARGE OF INDENTURE
  

Section 11.1

   Discharge of Indenture    74    ARTICLE XII       MISCELLANEOUS   

Section 12.1

   Right of Trustee to Perform    74

Section 12.2

   Waiver    74

Section 12.3

   Severability    75

Section 12.4

   Restrictions on Exercise of Certain Rights    75

Section 12.5

   Notices    75

Section 12.6

   Assignments    76

Section 12.7

   Application to Court    76

 

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Section 12.8

   GOVERNING LAW    76

Section 12.9

   Jurisdiction    77

Section 12.10

   Counterparts    78

Section 12.11

   Table of Contents and Headings    78

Section 12.12

   Trust Indenture Act    78

Section 12.13

   Confidential Information    78

Section 12.14

   Limited Recourse    80

Section 12.15

   Tax Matters    80

Section 12.16

   Waiver    81

Section 12.17

   Distribution Reports    81

 

Schedule A    Tax Distribution Minimum Amounts Annex A    Rules of Construction
and Defined Terms Exhibit A    Form of Original Class A Notes Exhibit B    Form
of Resale Confidentiality Undertaking Exhibit C    Agents for Service of Process
Exhibit D    Coverage of Distribution Report Exhibit E    UCC Financing
Statements Exhibit F    Form of Certificate of Euroclear or Clearstream for
Permanent Regulation S Global Note Exhibit G    Form of Certification of
Beneficial Owner of Temporary Regulation S Global Note Exhibit H    Form of
Certification of Euroclear or Clearstream for Payments Exhibit I    Form of
Certificate of Proposed Transferor Exhibit J    Form of Certificate of Certain
Proposed Institutional Accredited Investor Transferees Exhibit K    Form of
Portfolio Interest Certificate

 

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INDENTURE

This INDENTURE, dated as of August 26, 2008, is by and between LEDGEMONT ROYALTY
SUB LLC, a Delaware limited liability company, as issuer of the Notes described
herein, and U.S. BANK NATIONAL ASSOCIATION, a national banking association, as
initial trustee of the Notes described herein.

GRANTING CLAUSE

NOW, THEREFORE, THIS INDENTURE WITNESSETH, that, in consideration of the
premises and the acceptance by the Trustee of the trusts hereby created and of
the purchase and acceptance of the Notes by the Noteholders, and for other good
and valuable consideration, the receipt of which is hereby acknowledged, in
order to secure (i) the prompt payment of the principal of, Premium (if any) and
interest on, and all other amounts due with respect to, the Notes from time to
time Outstanding hereunder, including any break funding costs, (ii) the payment
of any fees, expenses or other amounts that the Issuer is obligated to pay under
or in respect of the Notes, this Indenture or any other Transaction Document to
which the Issuer is a party, (iii) the payment and performance of all the
obligations of the Issuer in respect of any amendment, modification, extension,
renewal or refinancing of the Notes and (iv) the performance and observance by
the Issuer of all the agreements, covenants and provisions expressed or implied
herein and in the Notes for the benefit of the Noteholders (collectively, the
“Secured Obligations”) and for the uses and purposes and subject to the terms
and provisions hereof, the Issuer does hereby grant, bargain, sell, assign,
transfer, convey, mortgage, pledge and confirm unto the Trustee, its successors
and assigns, for the security and benefit of the Trustee and the Noteholders
from time to time, a first priority security interest in all right, title and
interest of the Issuer in, to and under the following described property, rights
and privileges (such property, rights and privileges, including all other
property, rights and privileges hereafter specifically subjected to the lien of
this Indenture or any indenture supplemental hereto, being the “Collateral” and,
collectively, including all other property hereafter specifically subjected to
the lien of this Indenture or any indenture supplemental hereto, are included
within and defined as the “Indenture Estate”), to wit:

(1) the Purchased Assets;

(2) the Deal Documents and other agreements to which the Issuer is a party,
including those relating to the rights of the Issuer in respect of the sale,
transfer, conveyance, assignment, contribution, grant and servicing of the
Purchased Assets;

(3)(A) all Accounts established under this Indenture at any time, (B) all
amounts from time to time credited to such Accounts, (C) all cash, financial
assets and other investment property, instruments, documents, chattel paper,
general intangibles, accounts and other property from time to time credited to
such Accounts or representing investments and reinvestments of amounts credited
to such Accounts and (D) all interest, principal payments, dividends and other
distributions payable on or with respect to, and all proceeds of, (i) all
property so credited or representing such investments and reinvestments and
(ii) such Accounts;

 

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(4) all of the Issuer’s rents, issues, profits, revenues and other income of the
property subjected or required to be subjected to the lien of this Indenture;

(5) all other property and assets of the Issuer with respect to which a security
interest can be created under Article 9 of the UCC, including all goods, deposit
accounts, investment property, financial assets, letter-of-credit rights,
supporting obligations, commercial tort claims, accounts, contract rights,
general intangibles and all other cash (except (i) to the extent permitted to be
distributed by the Issuer to the Equityholders pursuant to Section 3.7(a)(iii)
or Section 3.7(b) and (ii) proceeds from any Notes issued in accordance with and
pursuant to this Indenture except for amounts to be used for Redemption of the
Notes prior to such Redemption);

(6) all rights of the Issuer (contractual and otherwise) constituting, arising
under, connected with or in any way related to any or all of the foregoing
property;

(7) all books, records, ledger cards, files, correspondence, computer programs,
tapes, disks and related data processing software (owned by the Issuer) that at
any time evidence or contain information relating to any of the foregoing
property or are otherwise necessary or helpful in the collection thereof or
realization thereupon;

(8) all documents of title, policies and certificates of insurance, securities,
chattel paper and other documents or instruments evidencing or pertaining to any
of the foregoing property of the Issuer; and

(9) all proceeds and products of any and all of the foregoing property;

BUT SUBJECT TO all of the terms and conditions of this Indenture.

HABENDUM CLAUSE

TO HAVE AND TO HOLD all and singular the aforesaid property unto the Trustee,
its successors and assigns, in trust for the benefit and security of the
Noteholders from time to time of each class of the Notes, without any priority
of any one class of Notes over any other class of Notes by reason of difference
in time of issuance or otherwise, except as expressly provided herein, and for
the uses and purposes and subject to the terms and provisions set forth in this
Indenture.

PROVIDED, HOWEVER, that, notwithstanding any of the foregoing provisions or
anything to the contrary herein, so long as no Event of Default shall have
occurred and be continuing, the Issuer shall have the right, to the exclusion of
the Trustee and the Noteholders, to exercise in the Issuer’s name all rights and
powers of the Issuer under the Purchase and Sale Agreement and any other
agreement (including any other Deal Document) to which the Issuer is or may be a
party or third party beneficiary (including the Principal Documents), except as
otherwise set forth in any such agreement, and SUBJECT TO all of the terms and
conditions of this Indenture.

It is hereby further agreed that any and all property described or referred to
in the Granting Clause that is hereafter acquired by the Issuer shall ipso
facto, and without any other conveyance, assignment or act on the part of the
Issuer or the Trustee, become and be subject to the Security Interest herein
granted as fully and completely as though specifically described herein, but
nothing contained in this paragraph shall be deemed to modify or change the
obligations of the Issuer contained in the foregoing paragraphs.

 

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The Issuer does hereby ratify and confirm this Indenture and the other Deal
Documents to which it is a party and, subject to the other terms of this
Indenture, does hereby agree that it will not take or omit to take any action,
the taking or omission of which might result in an alteration or impairment of
the assignment hereunder or of any of the rights created by any thereof.

It is expressly agreed that anything herein contained to the contrary
notwithstanding, the Issuer shall remain liable under the Deal Documents and any
other contracts and agreements included in the Collateral to the extent set
forth therein and shall remain obligated to perform all of the duties and
obligations of the Issuer thereunder to the same extent as if this Indenture had
not been executed in accordance with and pursuant to the terms and provisions
thereof, the exercise by the Trustee of any of its rights hereunder shall not
release the Issuer from any of its duties or obligations under any such Deal
Documents or other contracts or agreements included in the Collateral, and,
prior to the foreclosure of the lien of this Indenture under Section 4.3, the
Trustee and the Noteholders shall have no obligation or liability under any
thereof by reason of or arising out of this Indenture or the assignment
hereunder, nor shall the Trustee or the Noteholders be required or obligated in
any manner to perform or fulfill any obligations or duties of the Issuer under
or pursuant to any Deal Document or any other contract or agreement included in
the Collateral or, except as herein expressly provided, to make any payment,
make any inquiry as to the nature or sufficiency of any payment received by it,
present or file any claim or take any action to collect or enforce any claim for
payment assigned hereunder or the payment of any amounts that may have been
assigned to it or to which it may be entitled at any time or times; provided,
however, that, in exercising any right of the Issuer under any Deal Document or
any other contract or agreement included in the Collateral, the Trustee and the
Noteholders shall be bound by, and shall comply with, the provisions thereof
applicable to the Issuer in respect of the exercise of such right and the
confidentiality provisions set forth therein to the extent permitted by
Applicable Law.

IT IS HEREBY COVENANTED AND AGREED by and between the parties hereto as follows:

ARTICLE I

GENERAL

Section 1.1 Rules of Construction and Defined Terms. The rules of construction
set forth in Annex A shall apply to this Indenture and are hereby incorporated
by reference into this Indenture as if set forth fully in this Indenture.
Capitalized terms used but not otherwise defined in this Indenture shall have
the respective meanings given to such terms in Annex A, which is hereby
incorporated by reference into this Indenture as if set forth fully in this
Indenture. Not all terms defined in Annex A are used in this Indenture.

Section 1.2 Compliance Certificates and Opinions. Upon any application or
request by the Issuer to the Trustee to take any action under any provision of
this Indenture, the Issuer shall furnish to the Trustee an Officer’s Certificate
stating that, in the opinion of the signer

 

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thereof in his or her capacity as such, all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with, and an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent, if any, have been complied with, except
that, in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.

Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to Section 5.3) or any indenture supplemental hereto shall include:

(a) a statement that each individual signing such certificate or opinion has
read such covenant or condition and the definitions in this Indenture relating
thereto;

(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;

(c) a statement that, in the opinion of each such individual in his or her
capacity as such, he or she has made such examination or investigation as is
necessary to enable him or her to express an informed opinion as to whether or
not such covenant or condition has been complied with; and

(d) a statement as to whether, in the opinion of each such individual, such
condition or covenant has been complied with.

Section 1.3 Acts of Noteholders.

(a) Any direction, consent, waiver or other action provided by this Indenture in
respect of the Notes of any class to be given or taken by Noteholders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Noteholders in person or by an agent or proxy duly
appointed in writing, and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee or to the Issuer. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
“Act” of the Noteholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose under this Indenture and conclusive in favor of
the Trustee or the Issuer, if made in the manner provided in this
Section 1.3(a).

(b) The fact and date of the execution by any Person of any such instrument or
writing may be proved by the certificate of any notary public or other officer
of any jurisdiction authorized to take acknowledgments of deeds or administer
oaths that the Person executing such instrument acknowledged to him or her the
execution thereof, or by an affidavit of a witness to such execution sworn to
before any such notary or such other officer and, where such execution is by an
officer of a corporation or association, trustee of a trust or member of a
partnership, on behalf of such corporation, association, trust or partnership,
such certificate or affidavit shall also constitute sufficient proof of his or
her authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other reasonable manner that the Trustee deems sufficient.

 

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(c) In determining whether the Noteholders have given any direction, consent,
request, demand, authorization, notice, waiver or other Act (a “Direction”)
under this Indenture, Notes owned by the Issuer, any Equityholder or any
Affiliate of any such Person shall be disregarded and deemed not to be
Outstanding for purposes of any such determination. In determining whether the
Trustee shall be protected in relying upon any such Direction, only Notes that a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded. Notwithstanding the foregoing, if any such Person owns 100% of the
Notes of any class Outstanding, such Notes shall not be so disregarded as
aforesaid.

(d) The Issuer may, at its option, by delivery of Officer’s Certificate(s) to
the Trustee, set a record date other than the Record Date to determine the
Noteholders in respect of the Notes of any class entitled to give any Direction
in respect of such Notes. Such record date shall be the record date specified in
such Officer’s Certificate, which shall be a date not more than 30 days prior to
the first solicitation of Noteholders in connection therewith. If such a record
date is fixed, such Direction may be given before or after such record date, but
only the Noteholders of the applicable class at the close of business on such
record date shall be deemed to be Noteholders for the purposes of determining
whether Noteholders of the requisite proportion of Outstanding Notes of such
class have authorized, agreed or consented to such Direction, and for that
purpose the Outstanding Notes of such class shall be computed as of such record
date; provided, that no such Direction by the Noteholders on such record date
shall be deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than one year after the record date.

(e) Any Direction or other action by the Noteholder of any Note shall bind the
Noteholder of every Note issued upon the transfer thereof, in exchange therefor
or in lieu thereof, whether or not notation of such action is made upon such
Note, and any Direction or other action by the Beneficial Holder of any
Beneficial Interest in any Note shall bind any transferee of such Beneficial
Interest.

ARTICLE II

THE NOTES

Section 2.1 Amount of Notes; Terms; Form; Execution and Delivery.

(a) The Outstanding Principal Balance of any class of Notes that may be
authenticated and delivered from time to time under this Indenture shall not
exceed, with respect to the Original Class A Notes, the initial Outstanding
Principal Balance for the Original Class A Notes set forth in the definition
thereof or, with respect to any Class B Notes or any class of Refinancing Notes,
the Outstanding Principal Balance authorized in the Resolution or indenture
supplemental hereto establishing such Class B Notes or Refinancing Notes;
provided, that (i) any Refinancing Notes shall be issued in accordance with
Section 2.15 and (ii) any Class B Notes shall be issued in accordance with
Section 2.16.

 

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(b) There shall be issued, authenticated and delivered on the Closing Date and
on the date of issuance of any Class B Notes or any Refinancing Notes to each of
the Noteholders Notes in the principal amounts and maturities and bearing the
interest rates, in each case in registered form and, in the case of the Original
Class A Notes, substantially in the form set forth in Exhibit A or, in the case
of any Class B Notes or any Refinancing Notes, substantially in the form set
forth in any indenture supplemental hereto, with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements typewritten, printed,
lithographed or engraved thereon, as may, consistently herewith, be prescribed
by the Trustee. The Trustee shall authenticate Notes and make Notes available
for delivery only upon the written order of the Issuer signed by a Responsible
Officer of the Issuer. Such order shall specify the aggregate principal amount
of Notes to be authenticated, the date of issue, whether they are to be issued
as Global Notes or Definitive Notes and delivery instructions.

Definitive Notes of each class shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods, as determined by the
Trustee. Any Notes offered and sold to Institutional Accredited Investors that
are not QIBs that are not offered and sold in offshore transactions in reliance
on Regulation S shall be issued initially in the form of Definitive Notes.

Any Notes offered and sold to QIBs or sold in reliance on Rule 144A shall be
issued initially in the form of one or more permanent Global Notes in registered
form, substantially in the form set forth in the applicable Exhibit to this
Indenture or in any indenture supplemental hereto (each, a “144A Global Note”),
registered in the name of the nominee of DTC, deposited with the Trustee, as
custodian for DTC, duly executed by the Issuer and authenticated by the Trustee
as hereinafter provided. The aggregate principal amount of each 144A Global Note
may from time to time be increased or decreased by adjustments made on the books
and records of the Registrar, as hereinafter provided.

Any Notes offered and sold to Institutional Accredited Investors in offshore
transactions in reliance on Regulation S shall be issued initially in the form
of one or more temporary global Notes in registered form substantially in the
form set forth in the applicable Exhibit to this Indenture or in any indenture
supplemental hereto (each, a “Temporary Regulation S Global Note”), registered
in the name of the nominee of DTC, deposited with the Trustee, as custodian for
DTC, duly executed by the Issuer and authenticated by the Trustee as hereinafter
provided. At any time following the applicable Regulation S Global Note Exchange
Date, upon receipt by the Trustee and the Issuer of a certificate substantially
in the form of Exhibit F, executed by Euroclear or Clearstream, as the case may
be, together with copies of certificates from Euroclear or Clearstream, as the
case may be, certifying that it has received certification of non-U.S.
beneficial ownership of a Temporary Regulation S Global Note (or portion
thereof) with respect to any Notes to be exchanged, one or more permanent Global
Notes for such Notes in registered form substantially in the form set forth in
the applicable Exhibit to this Indenture or in any indenture supplemental hereto
(each, a “Permanent Regulation S Global Note” and, together with each Temporary
Regulation S Global Note, the “Regulation S Global Notes”) duly executed by the
Issuer and authenticated by the Trustee as hereinafter provided shall be
deposited with the Trustee, as custodian for DTC, and the Registrar shall
reflect on its books and records the date

 

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and a decrease in the principal amount of the Temporary Regulation S Global Note
of such class in an amount equal to the principal amount of such Temporary
Regulation S Global Note exchanged. Until the Regulation S Global Note Exchange
Date with respect to any Temporary Regulation S Global Note, Beneficial
Interests in such Temporary Regulation S Global Note may be held only through
Agent Members acting for and on behalf of Euroclear and Clearstream.

Notes, if so provided herein or in any indenture supplemental hereto, shall be
issued in the form of permanent certificated Notes in registered form in
substantially the form set forth in this Section 2.1(b) (collectively with any
definitive, fully registered Notes issued pursuant to Section 2.10(b), the
“Definitive Notes”).

(c) Interest shall accrue on any class of Fixed Rate Notes from the date of
issuance of such Fixed Rate Notes and shall be computed for each Interest
Accrual Period on the basis of a 360-day year consisting of twelve 30-day months
on the Outstanding Principal Balance of such Notes. Interest shall accrue on any
class of Floating Rate Notes from the date of issuance of such Floating Rate
Notes and shall be computed for each Interest Accrual Period on the basis of a
360-day year and the actual number of days elapsed in such Interest Accrual
Period on the Outstanding Principal Balance of such Notes. If any interest
payment is not made when due on a Payment Date, the unpaid portion of such
interest payment will accrue interest at the rate then applicable to the Notes,
compounded quarterly, until paid in full.

(d) On the date of any Refinancing, the Issuer shall issue and deliver, as
provided in Section 2.15, an aggregate principal amount of Refinancing Notes
having the maturities and bearing the interest rates and such other terms
authorized by one or more Resolutions or in any indenture supplemental hereto
providing for the issuance of such Refinancing Notes or specified in the form of
such Refinancing Notes, in each case in accordance with Section 2.15.

(e) On the date of any Class B Issuance, the Issuer shall issue and deliver, as
provided in Section 2.16, an aggregate principal amount of Class B Notes having
the maturities and bearing the interest rates and such other terms authorized by
one or more Resolutions or in any indenture supplemental hereto providing for
the issuance of such Class B Notes or specified in the form of such Class B
Notes, in each case in accordance with Section 2.16.

(f) The Notes shall be executed on behalf of the Issuer by the manual or
facsimile signature of a Responsible Officer of the Issuer or any individual
authorized to do so by a Responsible Officer of the Issuer.

(g) Each Note bearing the manual or facsimile signature of any individual who at
the time such Note was executed was authorized to execute such Note by a
Responsible Officer of the Issuer shall bind the Issuer, notwithstanding that
any such individual has ceased to hold such authority thereafter but prior to
the authentication and delivery of such Notes or any payment thereon.

(h) At any time and from time to time after the execution of any Notes, the
Issuer may deliver such Notes to the Trustee for authentication and, subject to
the provisions of Section 2.1(i), the Trustee shall authenticate such Notes by
manual or facsimile signature upon receipt by it of a written order of the
Issuer. The Notes shall be authenticated on behalf of the Trustee by any
Responsible Officer of the Trustee.

 

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(i) No Note shall be entitled to any benefit under this Indenture or be valid or
obligatory for any purpose, unless it shall have been executed on behalf of the
Issuer as provided in Section 2.1(f) and authenticated by or on behalf of the
Trustee as provided in Section 2.1(h). Such signatures shall be conclusive
evidence that such Note has been duly executed and authenticated under this
Indenture. Each Note shall be dated the date of its authentication.

Section 2.2 Restrictive Legends. Each Note (and all Notes issued in exchange
therefor or upon registration of transfer or substitution thereof) shall bear
the following legend on the face thereof (the “Private Placement Legend”):

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), THE SECURITIES LAWS OF ANY STATE OR THE SECURITIES LAWS
OF ANY OTHER JURISDICTION, NOR IS SUCH REGISTRATION CONTEMPLATED. NEITHER THIS
NOTE NOR ANY INTEREST HEREIN MAY BE ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED,
SOLD OR OFFERED FOR SALE OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION UNDER THE SECURITIES ACT OR AN EXEMPTION FROM SUCH REGISTRATION
THEREUNDER AND ANY OTHER APPLICABLE SECURITIES LAW REGISTRATION REQUIREMENTS.
EACH PERSON WHO ACQUIRES OR ACCEPTS THIS NOTE OR AN INTEREST HEREIN BY SUCH
ACQUISITION OR ACCEPTANCE (1) REPRESENTS THAT (A) IT IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) AND, IF
SUBSEQUENT TO THE INITIAL ACQUISITION HEREOF, IS PURCHASING THIS NOTE IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT,
(B) IT IS AN INSTITUTIONAL ACCREDITED INVESTOR AS DEFINED IN SUBPARAGRAPH
(a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT (AN “INSTITUTIONAL
ACCREDITED INVESTOR”), HAS SUFFICIENT KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND
BUSINESS MATTERS TO BE CAPABLE OF EVALUATING THE MERITS AND RISKS OF THE
PURCHASE OF THIS NOTE AND IS ABLE AND PREPARED TO BEAR THE ECONOMIC RISK OF
INVESTING IN AND HOLDING THIS NOTE, (C) IT IS AN INSTITUTIONAL ACCREDITED
INVESTOR THAT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH RULE 903 OR 904 OF REGULATION S UNDER THE
SECURITIES ACT OR (D) IT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THIS
NOTE AFTER THE RESALE RESTRICTION TERMINATION DATE (AS DEFINED BELOW),
(2) AGREES THAT IT WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE OR AN
INTEREST HEREIN, EXCEPT (A) TO THE ISSUER OR A SUBSIDIARY THEREOF, (B) FOR SO
LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT TO RULE

 

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144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER, TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT, (C) TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT IS PURCHASING THIS NOTE OR AN INTEREST
HEREIN, AS THE CASE MAY BE, FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT OR (D) TO AN INSTITUTIONAL ACCREDITED INVESTOR OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 903 OR 904 OF
REGULATION S UNDER THE SECURITIES ACT (IF AVAILABLE), OR UNLESS CONSENTED TO BY
THE ISSUER IN ITS SOLE DISCRETION AND SUCH OFFER, SALE OR OTHER TRANSFER OCCURS
FOLLOWING (X) THE DATE THAT IS ONE YEAR (OR SUCH SHORTER PERIOD OF TIME AS
PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION
THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR ANY
PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY
APPLICABLE LAW (THE “RESALE RESTRICTION TERMINATION DATE”) AND (3) AGREES THAT
IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED, THAT
THE ISSUER AND THE TRUSTEE SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER PURSUANT TO CLAUSE (2)(C) OR (D) OF THIS PARAGRAPH TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. THE TERMS “OFFSHORE TRANSACTION”, “UNITED STATES”
AND “U.S. PERSON” HAVE THE RESPECTIVE MEANINGS GIVEN TO THEM BY REGULATION S
UNDER THE SECURITIES ACT. THE INDENTURE REFERRED TO HEREINAFTER CONTAINS A
PROVISION REQUIRING THE REGISTRAR APPOINTED THEREUNDER TO REFUSE TO REGISTER ANY
TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING RESTRICTIONS.

Each Note shall also bear the following legend on the face thereof:

BY ITS PURCHASE AND ACCEPTANCE OF THIS NOTE, EACH PURCHASER WILL BE DEEMED TO
HAVE REPRESENTED AND WARRANTED THAT EITHER (I) NO PLAN ASSETS HAVE BEEN USED TO
PURCHASE THIS NOTE OR (II) TO THE EXTENT THAT PLAN ASSETS ARE USED TO PURCHASE
THIS NOTE (X) ONE OR MORE STATUTORY OR ADMINISTRATIVE EXEMPTIONS APPLIES SUCH
THAT THE USE OF

 

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PLAN ASSETS TO PURCHASE AND HOLD THIS NOTE WILL NOT CONSTITUTE A NON-EXEMPT
PROHIBITED TRANSACTION OR (Y) SUCH ASSETS ARE NOT CONSIDERED PLAN ASSETS BY
REASON OF BEING HELD IN A SEPARATE ACCOUNT OF AN INSURANCE COMPANY, UNDER WHICH
AMOUNTS PAYABLE OR CREDITED TO THE PLAN AND TO ANY PARTICIPANT OR BENEFICIARY OF
THE PLAN ARE NOT AFFECTED BY THE INVESTMENT PERFORMANCE OF THE SEPARATE ACCOUNT.
“PLAN ASSETS” HAS THE MEANING GIVEN TO IT BY SECTION 3(42) OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) AND REGULATIONS OF
THE U.S. DEPARTMENT OF LABOR.

THIS NOTE MAY NOT BE RESOLD OR TRANSFERRED EXCEPT AS SET FORTH IN THE INDENTURE
REFERRED TO HEREINAFTER, AND, IN ADDITION, EACH PERSON WHO ACQUIRES OR ACCEPTS
THIS NOTE OR AN INTEREST HEREIN BY SUCH ACQUISITION OR ACCEPTANCE AGREES THAT IT
SHALL CAUSE ANY PROPOSED TRANSFEREE TO EXECUTE A RESALE CONFIDENTIALITY
UNDERTAKING IN THE FORM ATTACHED AS EXHIBIT B TO SUCH INDENTURE AND DELIVER SUCH
RESALE CONFIDENTIALITY UNDERTAKING TO THE REGISTRAR (AS DEFINED IN SUCH
INDENTURE) AND FURTHER AGREES TO OTHERWISE COMPLY WITH THE TRANSFER RESTRICTIONS
SET FORTH IN SUCH INDENTURE, INCLUDING SECTION 2.11 THEREOF, AND FURTHER
ACKNOWLEDGES AND AGREES TO THE PROVISIONS SET FORTH IN SECTION 2.5 OF SUCH
INDENTURE.

Each Note shall also bear the following legend on the face thereof:

BY ITS ACQUISITION HEREOF, THE HOLDER ACKNOWLEDGES THAT THIS NOTE (OR ANY
BENEFICIAL INTEREST THEREIN) MAY NOT BE EXCHANGED OR TRANSFERRED IF, IMMEDIATELY
AFTER SUCH EXCHANGE OR TRANSFER, THERE WOULD BE MORE THAN 95 NOTEHOLDERS (IN THE
CASE OF NOTES THAT ARE DEFINITIVE NOTES) OR BENEFICIAL HOLDERS (IN THE CASE OF
NOTES THAT ARE GLOBAL NOTES), TAKEN TOGETHER IN THE AGGREGATE, AND ANY SUCH
PURPORTED EXCHANGE OR TRANSFER SHALL BE VOID AB INITIO.

Each Global Note shall also bear the following legend on the face thereof:

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS

 

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MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART,
TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE
AND TRANSFERS OF PORTIONS OF THIS NOTE SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.11 OF THE INDENTURE
REFERRED TO HEREINAFTER.

Each Temporary Regulation S Global Note shall also bear the following legend on
the face thereof:

THIS NOTE IS A TEMPORARY REGULATION S GLOBAL NOTE WITHIN THE MEANING OF THE
INDENTURE REFERRED TO HEREINAFTER AND IS SUBJECT TO RESTRICTIONS ON THE TRANSFER
AND EXCHANGE THEREOF AND ON THE PAYMENT OF INTEREST THEREON AS SPECIFIED IN THE
INDENTURE REFERRED TO HEREINAFTER.

Section 2.3 Registrar and Paying Agent.

(a) With respect to each class of Notes, there shall at all times be maintained
an office or agency in the location set forth in Section 12.5 where the Notes of
such class may be presented or surrendered for registration of transfer or for
exchange (including any additional registrar, each, a “Registrar”) and for
payment thereof (including any additional paying agent, each, a “Paying Agent”)
and where notices and demands to or upon the Issuer in respect of such Notes may
be served. The Trustee shall be the initial Paying Agent and Registrar, and the
Issuer shall not be permitted to act as a Paying Agent or a Registrar. The
Issuer shall cause each Registrar to keep a register of such class of Notes for
which it is acting as Registrar and of their transfer and exchange (the
“Register”). Written notice of the location of each such other office or agency
and of any change of location thereof shall be given by the Trustee to the
Issuer and the Noteholders of such class of Notes. In the event that no such
office or agency shall be maintained or no such notice of location or of change
of location shall be given, presentations and demands may be made and notices
may be served at the Corporate Trust Office.

(b) Each Authorized Agent shall be a bank, trust company or corporation
organized and doing business under the laws of the U.S., any state or territory
thereof or of the District of Columbia, with a combined capital and surplus of
at least $75,000,000 (or having a combined capital and surplus in excess of
$5,000,000 and the obligations of which, whether now in existence or hereafter
incurred, are fully and unconditionally Guaranteed by a bank, trust company or
corporation organized and doing business under the laws of the U.S., any state
or

 

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territory thereof or of the District of Columbia and having a combined capital
and surplus of at least $75,000,000) and shall be authorized under the laws of
the U.S., any state or territory thereof or the District of Columbia to exercise
corporate trust powers, subject to supervision by federal or state authorities
(such requirements, the “Eligibility Requirements”). Each Registrar other than
the Trustee shall furnish to the Trustee, at least five Business Days prior to
each Payment Date, and at such other times as the Trustee may request in
writing, a copy of the Register maintained by such Registrar.

(c) Any Person into which any Authorized Agent may be merged or converted or
with which it may be consolidated, or any Person resulting from any merger,
consolidation or conversion to which any Authorized Agent shall be a party, or
any Person succeeding to all or substantially all of the corporate trust
business of any Authorized Agent (including the administration of the fiduciary
relationship contemplated by this Indenture), shall be the successor of such
Authorized Agent hereunder, if such successor corporation is otherwise eligible
under this Section 2.3, without the execution or filing of any paper or any
further act on the part of the parties hereto or such Authorized Agent or such
successor Person.

(d) Any Authorized Agent may at any time resign by giving written notice of
resignation to the Trustee and the Issuer. The Issuer may, and at the request of
the Trustee shall, at any time terminate the agency of any Authorized Agent by
giving written notice of termination to such Authorized Agent and to the
Trustee. Upon the resignation or termination of an Authorized Agent or if at any
time any such Authorized Agent shall cease to be eligible under this Section 2.3
(when, in either case, no other Authorized Agent performing the functions of
such Authorized Agent shall have been appointed by the Trustee), the Issuer
shall promptly appoint one or more qualified successor Authorized Agents,
reasonably satisfactory to the Trustee, to perform the functions of the
Authorized Agent that has resigned or whose agency has been terminated or who
shall have ceased to be eligible under this Section 2.3. The Issuer shall give
written notice of any such appointment made by it to the Trustee, and in each
case the Trustee shall mail notice of such appointment to all Noteholders of the
related class of Notes as their names and addresses appear on the Register for
such class of Notes.

(e) The Issuer agrees to pay, or cause to be paid, from time to time to each
Authorized Agent reasonable compensation for its services and to reimburse it
for its reasonable expenses to be agreed to pursuant to separate agreements with
each such Authorized Agent.

Section 2.4 Paying Agent to Hold Money in Trust. The Trustee shall require each
Paying Agent other than the Trustee to agree in writing that all moneys
deposited with any Paying Agent for the purpose of any payment on the Notes
shall be deposited and held in trust for the benefit of the Noteholders entitled
to such payment, subject to the provisions of this Section 2.4. Moneys so
deposited and held in trust shall constitute a separate trust fund for the
benefit of the Noteholders with respect to which such money was deposited.

The Trustee may at any time, for the purpose of obtaining the satisfaction and
discharge of this Indenture or for any other purpose, direct any Paying Agent to
pay to the Trustee all sums held in trust by such Paying Agent, and, upon such
payment by any Paying Agent to the Trustee, such Paying Agent shall be released
from all further liability with respect to such money.

 

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Section 2.5 Method of Payment.

(a) On each Payment Date, the Trustee shall, or shall instruct a Paying Agent
to, pay, to the extent of the Available Collections Amount for such Payment Date
and any funds withdrawn from the Interest Reserve Account or the Capital Account
by the Trustee pursuant to Section 3.8, to the Noteholders all interest,
principal and Premium, if any, on each class of Notes in the amounts determined
by the Calculation Agent pursuant to Section 3.5; provided, that payment on a
Temporary Regulation S Global Note shall be made to the Noteholder thereof only
in conformity with Section 2.5(c) and payment on any Note may be deferred as
provided in Section 2.5(d). Each payment on any Payment Date other than the
final payment with respect to any class of Notes shall be made by the Trustee or
Paying Agent to the Noteholders as of the Record Date for such Payment Date. The
final payment with respect to any class of Notes, however, shall be made only
upon presentation and surrender of such Note by the Noteholder or its agent at
an office or agency of the Trustee or Paying Agent in New York City.

(b) At such time, if any, as the Notes of any class are issued in the form of
Definitive Notes, payments on a Payment Date shall be made by check mailed to
each Noteholder of a Definitive Note on the applicable Record Date at its
address appearing on the Register maintained with respect to such class of Notes
or, alternatively, upon application in writing to the Trustee, not later than
the applicable Record Date, by a Noteholder, subject to Section 2.5(d), any such
payments shall be made by wire transfer to an account designated by such
Noteholder at a financial institution in New York City; provided, that, in each
case, the final payment for any class of Notes shall be made only upon
presentation and surrender of the Definitive Notes of such class by the
Noteholder or its agent at an office or agency of the Trustee or Paying Agent in
New York City. Payments in respect of the Notes represented by a Global Note
(including principal, Premium, if any, and interest) shall be made by wire
transfer of immediately available funds to the account specified by DTC at a
financial institution in New York City.

(c) The beneficial owner of a Temporary Regulation S Global Note may arrange to
receive payments through Euroclear or Clearstream on such Temporary Regulation S
Global Note only after delivery by such beneficial owner to Euroclear or
Clearstream, as the case may be, of a written certification substantially in the
form of Exhibit G and upon delivery by Euroclear or Clearstream, as the case may
be, to the Paying Agent of a certification or certifications substantially in
the form of Exhibit H. No interest shall be paid to any beneficial owner and no
interest shall be paid to Euroclear or Clearstream on such beneficial owner’s
interest in a Temporary Regulation S Global Note unless Euroclear or
Clearstream, as the case may be, has provided such a certification to the Paying
Agent with respect to such interest.

(d) Not later than five Business Days prior to each Payment Date or any other
date on which a Distribution Report is to be distributed to Noteholders and
Beneficial Holders pursuant to Section 2.13(a), the Registrar shall use
commercially reasonable efforts to (i) prepare a list (the “Approved Holder
List”) of each Noteholder and Beneficial Holder as of the related Record Date
that has executed and delivered to the Registrar a Confidentiality Agreement,
(ii) obtain from DTC a list (the “DTC List”) of the Agent Members holding
Beneficial Interests in the Notes as of such Record Date, (iii) obtain from each
such Agent Member as of such Record Date the corresponding Beneficial Holders of
the Beneficial Interests held by each such Agent

 

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Member set forth on the DTC List as of such Record Date and prepare a list
thereof and of the Beneficial Interests owned by each such Beneficial Holder
(the “Actual Beneficial Holder List”), (iv) prepare a list (the “Escrow List”),
if necessary, that identifies any differences between (x) the Noteholders and
Beneficial Holders listed on the Approved Holder List and (y)(A) the Noteholders
of Definitive Notes set forth in the Register and (B) the Beneficial Holders
listed on the Actual Beneficial Holder List (or those Beneficial Holders that
the Registrar actually knows have not executed and delivered to the Registrar
Confidentiality Agreements), in each case as of such Record Date, and
(v) provide the Approved Holder List, the DTC List, the Actual Beneficial Holder
List and any Escrow List to the Issuer, the Servicer (if any) and the Trustee.
Each Noteholder, Agent Member and Beneficial Holder hereby agrees, acknowledges
and consents that (I) with respect to a Noteholder of any Notes (other than DTC
or its nominee) that as of such Record Date has not executed and delivered to
the Registrar a Confidentiality Agreement and, therefore, is listed on the
Escrow List, the Trustee promptly (but in no event less than three Business Days
prior to the applicable Payment Date) shall use commercially reasonable efforts
to notify such Noteholder of such failure and, on the applicable Payment Date,
cause any principal payment with respect to the Outstanding Principal Balance or
any payment of Premium, if any, or Interest Amount on such Notes to be paid
directly to the Escrow Account and (II) with respect to a Beneficial Holder of
any Beneficial Interest in a Note that as of such Record Date has not executed
and delivered to the Registrar a Confidentiality Agreement and, therefore, is
listed on the Escrow List, the Trustee promptly (but in no event less than three
Business Days prior to the applicable Payment Date) shall use commercially
reasonable efforts to cause the Beneficial Interest of such Beneficial Holder to
be transferred into the name of the Trustee (including the Trustee acting as an
Agent Member with respect to such Beneficial Interests) and shall use
commercially reasonable efforts to cause any payment of principal, Premium, if
any, or interest on such Notes or Beneficial Interests received on such Payment
Date to be deposited into the Escrow Account upon receipt thereof; provided,
that the Record Date with respect only to such Beneficial Holder shall be
changed to the Business Day immediately prior to the related Payment Date. Upon
receipt by the Trustee and the Issuer of written notice from the Registrar that
the applicable Noteholder or Beneficial Holder has executed and delivered to the
Registrar a Confidentiality Agreement, the Trustee will distribute such amounts,
without interest, from the Escrow Account to the Trustee for distribution to
each such Noteholder or Beneficial Holder, but prior to the receipt thereof the
Trustee shall be authorized to treat such purported Noteholder or Beneficial
Holder as not being a Noteholder or Beneficial Holder, as the case may be, for
purposes of this Indenture.

(e) To the extent that the full Interest Amount due on the Class A Notes is not
paid in full on any Payment Date and funds are deposited into the Collection
Account following such Payment Date but prior to the third Business Day prior to
the immediately succeeding Calculation Date, notwithstanding anything to the
contrary in this Indenture, the Trustee shall use such funds to pay to the
Noteholders of record the overdue Interest Amount on or before the third
Business Day after such funds are deposited; provided, that all Expenses with
respect to such preceding Payment Date contemplated by Section 3.7(a)(i) and all
Expenses for which the Issuer has previously submitted supporting documentation
pursuant to and as contemplated by Section 3.7(c), in each case, shall have been
paid. With each such payment the Trustee shall furnish a brief statement to
Noteholders eligible to receive Distribution Reports in accordance with this
Indenture indicating the aggregate amount of funds received and the balance of
overdue interest (and interest thereon) to which the payment is being applied.
Subject to Section 2.5(d),

 

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any such payment shall be made to the Noteholders of record as of the third
Business Day preceding the date of each such payment. Any funds that are
deposited on or after the third Business Day prior to the immediately succeeding
Calculation Date shall be held in the Collection Account and applied in
accordance with this Indenture on the next succeeding Payment Date.

(f) The payment of any Interest Amount in respect of a class of Notes on a
particular Payment Date shall be deemed allocated first to any unpaid Interest
Amount due prior to such Payment Date (together with Additional Interest
thereon) and second to any Interest Amount due on such Payment Date.

Section 2.6 Minimum Denominations. Each class of Notes shall be issued in
minimum denominations of $1,250,000 or integral multiples of $1,000 in excess
thereof.

Section 2.7 Transfer and Exchange; Cancellation. The Notes are issuable only in
fully registered form without coupons. A Noteholder or a Beneficial Holder may
transfer a Note or a Beneficial Interest therein only by written application to
the Registrar stating the name of the proposed transferee and otherwise
complying with the terms of this Indenture, including the requirement for the
execution and delivery of a Confidentiality Agreement by such proposed
transferee to the Registrar relating to such transfer as set forth in
Section 2.11(j). No such transfer shall be effected until, and such proposed
transferee shall succeed to the rights of a Noteholder or a Beneficial Holder
only upon, final acceptance and registration of the transfer by the Registrar
and confirmation by the Registrar pursuant to Section 2.11(j) that such
Noteholder or such Beneficial Holder has executed and delivered an appropriate
Confidentiality Agreement to the Registrar.

Prior to the due presentment for registration of transfer of a Note and
satisfaction of the requirements specified in the last sentence of the preceding
paragraph, the Issuer and the Trustee may deem and treat the applicable
registered Noteholder as the absolute owner and holder of such Note for the
purpose of receiving payment of all amounts payable with respect to such Note
and for all other purposes and shall not be affected by any notice to the
contrary. The Registrar (if different from the Trustee) shall promptly notify
the Trustee in writing and the Trustee shall promptly notify the Issuer of each
request for a registration of transfer of a Note by furnishing the Issuer a copy
of such request.

Furthermore, any Noteholder of a Global Note shall, by acceptance of such Global
Note, agree that, subject to Section 2.10(b) and Section 2.11, transfers of
Beneficial Interests in such Global Note may be effected only through a
book-entry system maintained by the Noteholder of such Global Note (or its
agent) and that ownership of a Beneficial Interest in such Global Note shall be
required to be reflected in a book-entry system. When Notes are presented to the
Registrar with a request to register the transfer or to exchange them for an
equal principal amount of Notes of other authorized denominations, the Registrar
shall register the transfer or make the exchange as requested if its
requirements for such transactions are met (including, in the case of a
transfer, that such Notes are duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee and Registrar duly
executed by the Noteholder thereof or by an attorney who is authorized in
writing to act on behalf of the Noteholder). To permit registrations of
transfers and exchanges, the Issuer shall execute and the Trustee shall
authenticate Notes at the Registrar’s request. Except as set forth in
Section 2.8 and Section 2.9, no service charge shall be made for any
registration of transfer or exchange or redemption of the Notes.

 

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The Registrar shall not be required to exchange or register the transfer of any
Notes as above provided during the 15-day period preceding the Final Legal
Maturity Date of any such Notes or during a 15-day period preceding the first
mailing of any notice of Redemption or Refinancing of Notes to be redeemed or
refinanced. The Registrar shall not be required to exchange or register the
transfer of any Notes that have been selected, called or are being called for
Redemption or Refinancing except, in the case of any Notes where written notice
has been given that such Notes are to be redeemed in part, the portion thereof
not so to be redeemed.

The Issuer at any time may deliver Notes to the Trustee for cancellation. The
Trustee and no one else shall cancel and destroy in accordance with its
customary practices in effect from time to time (subject to the record retention
requirements of the Exchange Act) any such Notes, together with any other Notes
surrendered to it for registration of transfer, exchange or payment. The Issuer
may not issue new Notes (other than Refinancing Notes issued in connection with
any Refinancing) to replace Notes it has redeemed, paid or delivered to the
Trustee for cancellation.

Section 2.8 Mutilated, Destroyed, Lost or Stolen Notes. If any Note shall become
mutilated, destroyed, lost or stolen, the Issuer shall, upon the written request
of the Noteholder thereof and presentation of the Note or satisfactory evidence
of destruction, loss or theft thereof to the Trustee or Registrar and a
confirmation by the Registrar to the Trustee that such Noteholder (or Beneficial
Holder of the Beneficial Interest therein) has executed and delivered to the
Registrar a Confidentiality Agreement, issue, and the Trustee shall authenticate
and the Trustee or Registrar shall deliver in exchange therefor or in
replacement thereof, a new Note, payable to such Noteholder in the same
principal amount, of the same maturity, with the same payment schedule, bearing
the same interest rate and dated the date of its authentication. If the Note
being replaced has become mutilated, such Note shall be surrendered to the
Trustee or the Registrar and forwarded to the Issuer by the Trustee or such
Registrar. If the Note being replaced has been destroyed, lost or stolen, the
Noteholder thereof shall furnish to the Issuer, the Trustee and the Registrar
(a) such security or indemnity as may be required by the Issuer, the Trustee and
the Registrar to save each of them harmless (an unsecured indemnity from any QIB
being satisfactory security or indemnity) and (b) evidence satisfactory to the
Issuer, the Trustee and the Registrar of the destruction, loss or theft of such
Note and of the ownership thereof (an affidavit from any QIB being satisfactory
evidence). The Noteholders will be required to pay any Tax or other governmental
charge imposed in connection with such exchange or replacement and any other
expenses (including the fees and expenses of the Trustee and the Registrar)
connected therewith.

Section 2.9 Payments of Transfer Taxes. Upon the transfer of any Note or Notes
pursuant to Section 2.7, the Issuer or the Trustee may require from the party
requesting such new Note or Notes payment of a sum to reimburse the Issuer or
the Trustee for, or to provide funds for the payment of, any transfer Tax or
similar governmental charge payable in connection therewith.

 

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Section 2.10 Book-Entry Provisions.

(a) Global Notes shall (i) be registered in the name of DTC or a nominee of DTC,
(ii) be delivered to the Trustee as custodian for DTC and (iii) bear the Private
Placement Legend. In accordance with the requirements of DTC, the Issuer will
cause the Trustee to authenticate an additional Global Note or additional Global
Notes in the appropriate principal amount such that no Global Note may exceed an
aggregate principal amount of $500,000,000 at any time.

Members of, or participants in, DTC (“Agent Members”) shall have no rights under
this Indenture with respect to any Global Note held on their behalf by DTC, or
the Trustee as its custodian, or under such Global Note, and DTC may be treated
by the Issuer, the Trustee and any agent of the Issuer or the Trustee as the
absolute owner of such Global Note for all purposes whatsoever.

Whenever notice or other communication to the Noteholders of any class of Global
Notes is required under this Indenture, unless and until Definitive Notes shall
have been issued pursuant to Section 2.10(b), the Trustee shall give all such
notices and communications specified herein to be given to Noteholders of such
class of Global Notes to DTC and/or the Agent Members, and shall make available
additional copies as requested by such Agent Members, subject to the limitations
on distribution contained in Section 2.13.

Notwithstanding the foregoing, nothing herein shall prevent the Issuer, the
Trustee or any agent of the Issuer or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by DTC or impair,
as between DTC and its Agent Members, the operation of customary practices
governing the exercise of the rights of a Noteholder under any Global Note.
Neither the Issuer nor the Trustee shall be liable for any delay by DTC in
identifying the Agent Members in respect of the Global Notes, and the Issuer and
the Trustee may conclusively rely on, and shall be fully protected in relying
on, instructions from DTC for all purposes (including with respect to the
registration and delivery, and the respective principal amounts, of any Global
Notes to be issued).

(b) Transfers of a Global Note shall be limited to transfers of such Global Note
in whole, but not in part, to DTC, its successors or their respective nominees.
Interests of Agent Members in a Global Note may be transferred in accordance
with the rules and procedures of DTC and the provisions of Section 2.11. Except
as set forth in Section 2.11(a), Definitive Notes shall be issued to the
individual Agent Members or Beneficial Holders or their nominees in exchange for
their Beneficial Interests in a Global Note with respect to any class of Notes
only if (i) the Issuer advises the Trustee in writing that DTC is no longer
willing or able to properly discharge its responsibilities as depositary with
respect to such class of Notes and the Trustee or the Issuer is unable to
appoint a qualified successor within 90 days of such notice or (ii) during the
occurrence of an Event of Default with respect to such class of Notes, any
Noteholder requests that all or a portion of a Global Note be exchanged for a
Definitive Note. Upon the occurrence of any event described in the immediately
preceding sentence, the Trustee shall notify all affected Noteholders of such
class, through DTC, of the occurrence of such event and of the availability of
Definitive Notes of such class; provided, however, that in no event shall the
Temporary Regulation S Global Note be exchanged for Definitive Notes prior to
the later of (x)

 

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the Regulation S Global Note Exchange Date and (y) the date of receipt by the
Issuer of any certificates determined by it to be required pursuant to Rule 903
or 904 under the Securities Act. Upon surrender to the Trustee of the Global
Notes of such class held by DTC, accompanied by registration instructions from
DTC for registration of Definitive Notes, the Issuer shall issue and the Trustee
shall authenticate and deliver the Definitive Notes of such class to the Agent
Members and Beneficial Holders of such class or their nominees in accordance
with the instructions of DTC.

None of the Issuer, the Registrar, the Paying Agent or the Trustee shall be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be fully protected in relying on, such registration instructions.
Upon the issuance of Definitive Notes of such class, the Trustee shall recognize
the Persons in whose name the Definitive Notes are registered in the Register as
Noteholders hereunder. Neither the Issuer nor the Trustee shall be liable if the
Trustee or the Issuer is unable to locate a qualified successor to DTC.

Definitive Notes of any class will be freely transferable and exchangeable for
Definitive Notes of the same class at the office of the Trustee or the office of
the Registrar upon compliance with the requirements set forth herein. In the
case of a transfer of only part of a holding of Definitive Notes, a new
Definitive Note shall be issued to the transferee in respect of the part
transferred and a new Definitive Note in respect of the balance of the holding
not transferred shall be issued to the transferor and may be obtained at the
office of the applicable Registrar.

(c) Any Beneficial Interest in one of the Global Notes as to any class that is
transferred to a Person who takes delivery in the form of an interest in another
Global Note will, upon transfer, cease to be an interest in such Global Note and
become an interest in such other Global Note and, accordingly, will thereafter
be subject to all transfer restrictions, if any, and other procedures applicable
to Beneficial Interests in such other Global Note for as long as it remains such
an interest.

(d) Any Definitive Note delivered in exchange for an interest in a Global Note
pursuant to Section 2.10(b) shall bear the Private Placement Legend applicable
to a Global Note.

Section 2.11 Special Transfer Provisions.

(a) The following provisions shall apply with respect to any proposed transfer
of a Beneficial Interest in a 144A Global Note or a Permanent Regulation S
Global Note or a proposed transfer of a Definitive Note to any Institutional
Accredited Investor that is not a QIB (excluding Non-U.S. Persons) prior to the
Resale Restriction Termination Date:

(i) The Registrar shall register the transfer of any Definitive Note if the
proposed transferee has delivered to the Registrar (A) a certificate
substantially in the form of Exhibit J (such certificate also to be delivered to
the Issuer), (B) if requested by the Issuer or the Trustee, an Opinion of
Counsel acceptable to the Issuer that such transfer is in compliance with the
Securities Act and (C) a Confidentiality Agreement duly executed by such
transferee.

 

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(ii) If the proposed transferor is an Agent Member holding a Beneficial Interest
in a 144A Global Note or a Permanent Regulation S Global Note, upon receipt by
the Registrar of (A) the documents required by Section 2.11(a)(i), including the
Confidentiality Agreement, and (B) instructions given in accordance with DTC’s
and the Registrar’s procedures, the Registrar shall reflect on its books and
records the date and a decrease in the principal amount of the 144A Global Note
or the Permanent Regulation S Global Note, as the case may be, in an amount
equal to the principal amount of the Beneficial Interest in the Global Note to
be transferred, and the Issuer shall execute, and the Trustee shall authenticate
and deliver, one or more Definitive Notes of like tenor and amount.

(b) The following provisions shall apply with respect to any proposed transfer
of a Beneficial Interest in a 144A Global Note or a Permanent Regulation S
Global Note or a proposed transfer of a Definitive Note to a QIB (excluding
Non-U.S. Persons) prior to the Resale Restriction Termination Date:

(i) If the Note to be transferred consists of (A) Definitive Notes, the
Registrar shall reflect the transfer on its books and records if such transfer
is being made by a proposed transferor who has delivered such Note and checked
the box provided for on the form of Note stating, or has otherwise advised the
Issuer and the Registrar in writing, that the sale has been made in compliance
with the provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Note stating, or has otherwise advised
the Issuer and the Registrar in writing, that (w) it is purchasing the Note for
its own account or an account with respect to which it exercises sole investment
discretion and that it and any such account are QIBs within the meaning of Rule
144A, (x) it is or such QIBs are aware that the sale to it or them is being made
in reliance on Rule 144A and acknowledge that it has or they have received such
information regarding the Issuer as it has or they have requested pursuant to
Rule 144A or has or have determined not to request such information, (y) it is
or such QIBs are aware that the transferor is relying upon the foregoing
representations in order to claim the exemption from registration provided by
Rule 144A and (z) it has and all such QIBs have duly executed and delivered to
the Registrar a Confidentiality Agreement or (B) a Beneficial Interest in a 144A
Global Note, the transfer of such Beneficial Interest may be effected only
through the book-entry system maintained by DTC and to the extent provided in
the agreement with DTC, and, in each case, each transferee has delivered to the
Registrar a Confidentiality Agreement duly executed by such transferee.

(ii) If the proposed transferee is an Agent Member, and the Note to be
transferred is a Definitive Note, upon receipt by the Registrar of the documents
referred to in Section 2.11(b)(i), including the Confidentiality Agreement, and
instructions given in accordance with DTC’s and the Registrar’s procedures, the
Registrar shall reflect on its books and records the date and an increase in the
principal amount at maturity of the 144A Global Note in an amount equal to the
principal amount at maturity of the Definitive Note to be transferred, and the
Trustee shall cancel the Definitive Note so transferred (upon written direction
from the Registrar if different from the Trustee).

(iii) If the proposed transferee is an Agent Member, and the Note to be
transferred is represented by a Beneficial Interest in a Permanent Regulation S
Global Note, upon receipt by the Registrar of the documents referred to in
Section 2.11(b)(i),

 

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including the Confidentiality Agreement, and instructions given in accordance
with DTC’s and the Registrar’s procedures, the Registrar shall reflect on its
books and records the date and a decrease in the principal amount of the
Permanent Regulation S Global Note in an amount equal to the principal amount of
the Beneficial Interest in the Permanent Regulation S Global Note to be
transferred, and the Registrar shall reflect on its books and records an
increase in the principal amount of the 144A Global Note in an amount equal to
such transferred amount.

(c) With respect to any proposed transfer of a Beneficial Interest in a
Temporary Regulation S Global Note to an Institutional Accredited Investor prior
to the Resale Restriction Termination Date, the Registrar shall reflect on its
books and records the transfer of such Beneficial Interest (A) if the proposed
transferee is a Non-U.S. Person, the proposed transferor has delivered to the
Registrar a certificate substantially in the form of Exhibit I (such certificate
also to be delivered to the Issuer) and the proposed transferee has duly
executed and delivered to the Registrar a Confidentiality Agreement (in which
case the transferee will receive a corresponding Beneficial Interest in the
Temporary Regulation S Global Note) or (B) if the proposed transferee is a QIB
and the proposed transferor has checked the box provided for on the form of Note
stating, or has otherwise advised the Issuer and the Registrar in writing, that
the sale has been made in compliance with the provisions of Rule 144A to a
transferee who has signed the certification provided for on the form of Note
stating, or has otherwise advised the Issuer and the Registrar in writing, that
(w) it is purchasing the Note (or the Beneficial Interest therein) for its own
account or an account with respect to which it exercises sole investment
discretion and that it and any such account are QIBs within the meaning of Rule
144A, (x) it is or such QIBs are aware that the sale to it or them is being made
in reliance on Rule 144A and acknowledge that it has or they have received such
information regarding the Issuer as it has or they have requested pursuant to
Rule 144A or has or have determined not to request such information, (y) it is
or such QIBs are aware that the transferor is relying upon the foregoing
representations in order to claim the exemption from registration provided by
Rule 144A and (z) it has and all such QIBs have duly executed and delivered to
the Registrar a Confidentiality Agreement (in which case the Registrar shall
reflect on its books and records the date and an increase in the principal
amount of the 144A Global Note of the relevant class, in an amount equal to the
principal amount of the Temporary Regulation S Global Note (or the Beneficial
Interest therein) of such class to be transferred, and the Trustee shall
decrease the amount of the Temporary Regulation S Global Note of such class
(upon written direction from the Registrar if different from the Trustee)).

(d) Except as set forth in Section 2.11(c), prior to the Resale Restriction
Termination Date, the following provisions shall apply with respect to any
transfer of a Note (or a Beneficial Interest therein) to a Non-U.S. Person:

(i) Except as set forth in Section 2.11(c), prior to the applicable Regulation S
Global Note Exchange Date, the Registrar shall not register or reflect on its
books and records any proposed transfer of a Note (or a Beneficial Interest
therein) to a Non-U.S. Person.

 

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(ii) The Registrar shall register or reflect on its books and records, as the
case may be, any proposed transfer of a Note (or a Beneficial Interest therein)
to any Non-U.S. Person that is an Institutional Accredited Investor if the Note
to be transferred is a Definitive Note or a Beneficial Interest in a 144A Global
Note, upon receipt of a certificate substantially in the form of Exhibit I from
the proposed transferor and a Confidentiality Agreement duly executed and
delivered to the Registrar by such Non-U.S. Person that is an Institutional
Accredited Investor.

(iii)(A) If the proposed transferor is an Agent Member holding a Beneficial
Interest in a 144A Global Note, upon receipt by the Registrar of (x) the
documents, if any, required by Section 2.11(d)(ii) and (y) instructions in
accordance with DTC’s and the Registrar’s procedures, the Registrar shall
reflect on its books and records the date and a decrease in the principal amount
of the 144A Global Note in an amount equal to the principal amount of the
Beneficial Interest in such 144A Global Note to be transferred, and (B) if the
proposed transferee is an Agent Member, upon receipt by the Registrar of
instructions given in accordance with DTC’s and the Registrar’s procedures, the
Registrar shall reflect on its books and records the date and an increase in the
principal amount of the Permanent Regulation S Global Note of the relevant class
in an amount equal to the principal amount of the Beneficial Interest in such
144A Global Note or any Definitive Notes issued in exchange for such Beneficial
Interest in such 144A Global Note to be transferred, and the Trustee shall
cancel the Definitive Note, if any, so transferred or decrease the amount of the
144A Global Note (upon written direction from the Registrar if different from
the Trustee).

(e) With respect to any proposed transfer of any Note (or a Beneficial Interest
therein) after the Resale Restriction Termination Date, the Registrar shall
reflect the transfer of such Note or Beneficial Interest on its books and
records (along with any appropriate increase or decrease in the principal amount
at maturity of any Global Note upon receipt by the Registrar of instructions
given in accordance with DTC’s and the Registrar’s procedures) if the proposed
transferee has duly executed and delivered to the Registrar a Confidentiality
Agreement.

(f) Upon the transfer, exchange or replacement of Notes bearing the Private
Placement Legend, the Registrar shall deliver only Notes that bear the Private
Placement Legend.

(g) By its acceptance of any Note bearing the Private Placement Legend, each
Noteholder of such Note acknowledges the restrictions on transfer of such Note
set forth in this Indenture and in the Private Placement Legend and agrees that
it will transfer such Note (or the Beneficial Interest therein) only as provided
in this Indenture and in accordance with the Private Placement Legend. The
Registrar shall not register or reflect on its books and records a transfer of
any Note (or any Beneficial Interest therein) unless such transfer complies with
the restrictions on transfer of such Note set forth in this Indenture and in
accordance with the Private Placement Legend. In connection with any transfer of
Notes (or Beneficial Interests therein), each Noteholder (or Beneficial Holder)
agrees by its acceptance of the Notes (or Beneficial Interests therein) to
furnish the Trustee the certifications and legal opinions (if requested and
required pursuant hereto) described herein to confirm that such transfer is
being made pursuant to an exemption from, or a transaction not subject to, the
registration requirements of the Securities Act; provided, that the Trustee
shall not be required to determine (but may rely on a determination made by the
Issuer with respect to) the sufficiency of any such legal opinions.

 

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(h) The Notes shall be issued pursuant to an exemption from registration under
the Securities Act. The Issuer agrees that it will not at any time (i) apply to
list, list or list upon notice of issuance, (ii) consent to or authorize an
application for the listing or the listing of, or (iii) enable or authorize the
trading of, the Notes on an established securities market, including (w) a
national securities exchange registered under the Exchange Act or exempted from
registration because of the limited volume of transactions, (x) a foreign
securities exchange that, under the law of the jurisdiction where it is
organized, satisfies regulatory requirements that are analogous to the
regulatory requirements under the Exchange Act applicable to exchanges described
in Section 2.11(h)(w), (y) a regional or local exchange or (z) an
over-the-counter market, as the term “established securities market” and the
terms in this Section 2.11(h) are defined for purposes of Section 7704 of the
Code.

(i) The Trustee shall retain copies of all letters, notices and other written
communications received pursuant to Section 2.10 or this Section 2.11. The
Issuer shall have the right to inspect and make copies of all such letters,
notices, Confidentiality Agreements or other written communications at any
reasonable time upon the giving of reasonable written notice to the Trustee.

(j) Each Noteholder, Agent Member and Beneficial Holder agrees, by acceptance of
any Note or any Beneficial Interest therein, that it will not take any action to
transfer any Note (or any Beneficial Interest therein) to a proposed transferee
without causing such proposed transferee to execute and deliver to the Registrar
an appropriate Confidentiality Agreement relating to such transfer as set forth
in this Section 2.11. After the Closing Date with respect to the Original
Class A Notes (or the date of issuance with respect to any Class B Notes or any
Refinancing Notes), forms of Confidentiality Agreements will be available to
Noteholders, Agent Members and Beneficial Holders and proposed transferees of
the Notes (or the Beneficial Interests therein) from the Registrar, initially at
the Corporate Trust Office. Each such Confidentiality Agreement shall be
delivered to the Registrar promptly upon execution by the parties thereto and
the Registrar shall record the receipt of such Confidentiality Agreement. The
Registrar shall promptly, but in any event no later than two Business Days after
receipt of any such executed Confidentiality Agreement, furnish a copy of such
executed Confidentiality Agreement to the Trustee, the Issuer and the Servicer
(if any) and shall maintain a list of proposed transferees (including
Noteholders and Beneficial Holders) who have furnished such executed
Confidentiality Agreements, whether or not such proposed transferees purchase
any Notes (or any Beneficial Interests therein), and make such list available
for inspection at the request of the Trustee, the Issuer or the Servicer (if
any).

(k) Notwithstanding any other provision contained in this Indenture to the
contrary, any Noteholder or Beneficial Holder may assign a security interest in,
or pledge, all or any portion of the Notes (or any interest therein) held by it
to a lender or a trustee or collateral agent (or other similar representative)
under any indenture, loan agreement or similar agreement to which such
Noteholder or Beneficial Holder is party in support of any obligations of such
Noteholder or Beneficial Holder to a holder or holders of securities or other
obligations issued by such Noteholder or Beneficial Holder; provided, that no
such assignment or pledge shall release the assigning or pledging Noteholder or
Beneficial Holder from its obligations hereunder; provided, further, that any
assignee or pledgee shall be required to execute and deliver to the Registrar an
appropriate Confidentiality Agreement as a condition of such assignment or
pledge.

 

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Section 2.12 Temporary Definitive Notes. Pending the preparation of Definitive
Notes of any class, the Issuer may execute and the Trustee may authenticate and
deliver temporary Definitive Notes of such class that are printed, lithographed,
typewritten or otherwise produced, in any denomination, containing substantially
the same terms and provisions as are set forth in the applicable Exhibit or in
any indenture supplemental hereto, except for such appropriate insertions,
omissions, substitutions and other variations relating to their temporary nature
as a Responsible Officer of the Issuer executing such temporary Definitive Notes
may determine, as evidenced by his or her execution of such temporary Definitive
Notes.

If temporary Definitive Notes of any class are issued, the Issuer shall cause
such Definitive Notes of such class to be prepared without unreasonable delay.
After the preparation of Definitive Notes of such class, the temporary
Definitive Notes shall be exchangeable for Definitive Notes upon surrender of
such temporary Definitive Notes at the Corporate Trust Office, without charge to
the Noteholder thereof. Upon surrender for cancellation of any one or more
temporary Definitive Notes of any class, the Issuer shall execute and the
Trustee shall authenticate and deliver in exchange therefor Definitive Notes of
like class, in authorized denominations and in the same aggregate principal
amounts. Until so exchanged, such temporary Definitive Notes shall in all
respects be entitled to the same benefits under this Indenture as Definitive
Notes.

Section 2.13 Statements to Noteholders.

(a) On each Payment Date and any other date for distribution of any payments
with respect to any class of Notes then Outstanding, the Trustee shall deliver a
report, covering the information set forth in Exhibit D and prepared by the
Issuer (or any Servicer), giving effect to such payments (each, a “Distribution
Report”), to (i) each Noteholder and Beneficial Holder included on the Approved
Holder List, (ii) the Issuer, (iii) the Calculation Agent and (iv) the
Equityholders, and to no other Person. Each Noteholder and Beneficial Holder
shall be entitled to receive the Distribution Report only if such Noteholder or
Beneficial Holder has executed and delivered to the Registrar a Confidentiality
Agreement.

(b) Each Distribution Report provided to each Noteholder and Beneficial Holder
by the Trustee for each Payment Date pursuant to Section 2.13(a), commencing
November 5, 2008, shall be accompanied by (i) a statement prepared by the Issuer
(or any Servicer) setting forth an analysis of the Collection Account activity
for the period commencing on the day next following the preceding Calculation
Date and ending on the Calculation Date relating to such Payment Date and
(ii) the information, if any, that the Issuer shall have provided to the Trustee
pursuant to Section 5.3 (or any Servicer shall have provided to the Trustee
pursuant to Section 3.1 of the Servicing Agreement) during the Interest Accrual
Period then ended.

(c) After the end of each calendar year but not later than the latest date
permitted by law, the Trustee shall (or shall instruct any Paying Agent to)
furnish to each Person who at any time during such calendar year was a
Noteholder of any class of Notes a statement (for example, a Form 1099 or any
other means required by law) prepared by the Trustee containing the sum of the
amounts determined pursuant to the information covered by Exhibit D with respect
to the class of Notes for such calendar year or, in the event such Person was a
Noteholder of any class of Notes during only a portion of such calendar year,
for the applicable portion of

 

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such calendar year, and such other items as are readily available to the Trustee
and that a Noteholder shall reasonably request as necessary for the purpose of
such Noteholder’s preparation of its U.S. federal income or other tax returns.
So long as any of the Notes are registered in the name of DTC or its nominee,
such report and such other items will be prepared on the basis of such
information supplied to the Trustee by DTC and the Agent Members and will be
delivered by the Trustee to DTC and by DTC to the applicable Beneficial Holders
in the manner described above. In the event that any such information has been
provided by any Paying Agent directly to such Person through other tax-related
reports or otherwise, the Trustee in its capacity as Paying Agent shall not be
obligated to comply with such request for information.

(d) At such time, if any, as the Notes of any class are issued in the form of
Definitive Notes, the Trustee shall prepare and deliver the information
described in Section 2.13(c) to each Noteholder of a Definitive Note of such
class for the relevant period of registered ownership of such Definitive Note as
appears on the books and records of the Trustee, subject to confirmation that
each such Noteholder has executed and delivered to the Registrar a
Confidentiality Agreement.

(e) The Trustee shall be at liberty to sanction any method of giving notice to
the Noteholders of any class if, in its opinion, such method is reasonable,
having regard to the number and identity of the Noteholders of such class and/or
to market practice then prevailing, is in the best interests of the Noteholders
of such class, and any such notice shall be deemed to have been given on such
date as the Trustee may approve; provided, that notice of such method is given
to the Noteholders of such class in such manner as the Trustee shall require.

Section 2.14 CUSIP, CINS, ISIN and Private Placement Numbers. The Issuer in
issuing the Notes may use CUSIP, CINS, ISIN, private placement or other
identification numbers (if then generally in use), and, if so, the Trustee shall
use such CUSIP, CINS, ISIN, private placement or other identification numbers,
as the case may be, in notices of redemption or exchange as a convenience to
Noteholders; provided, that any such notice shall state that no representation
is made as to the correctness of such numbers either as printed on the Notes or
as contained in any notice of redemption or exchange and that reliance may be
placed only on the other identification numbers printed on the Notes; provided,
further, that failure to use CUSIP, CINS, ISIN, private placement or other
identification numbers in any notice of redemption or exchange shall not affect
the validity or sufficiency of such notice.

Section 2.15 Refinancing Notes.

(a) Subject to Section 2.15(b), Section 2.15(c) and Section 2.15(d), the Issuer
may issue Refinancing Notes pursuant to this Indenture for the purpose of
refinancing all of the Outstanding Principal Balance of any class of Notes
(including a refinancing of Refinancing Notes). Each refinancing of any class of
Notes with the proceeds of an offering of Refinancing Notes (a “Refinancing”)
shall be authorized pursuant to one or more Resolutions. Each Refinancing Note
shall be designated generally as a Note for all purposes under this Indenture,
with such further designations added or incorporated in such title as specified
in the related Resolution or in any indenture supplemental hereto providing for
the issuance of such Notes or specified in the form of such Notes, as the case
may be. The Refinancing Notes shall be issued on the Payment Date on which the
Redemption in whole of the class of Notes being refinanced is to occur as
provided in Section 3.10.

 

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(b) A Refinancing of any class of Notes shall be effected as a Redemption
pursuant to Section 3.9, provided that a Refinancing of the Original Class A
Notes shall be effected as an Optional Redemption pursuant to Section 3.9(b). On
the date of any Refinancing, the Issuer shall issue and sell an aggregate
principal amount of Refinancing Notes (when added to the Available Collections
Amount and any funds in the Interest Reserve Account, the Redemption Account or
the Capital Account used or to be used in connection with such Refinancing)
resulting in proceeds in an amount sufficient to pay in full the applicable
Redemption Price of the Notes being refinanced in whole thereby plus the
Refinancing Expenses relating thereto. The proceeds of each sale of Refinancing
Notes shall be used to the extent necessary to make the deposit required by
Section 3.10 and to pay such Refinancing Expenses. Subject to Section 3.10(b),
once a notice of a Redemption in respect of any Refinancing is published in
accordance with Section 3.10(a), each class of Notes to which such notice
applies shall become due and payable on the Refinancing Date stated in such
notice at their Redemption Price.

(c) Each Refinancing Note shall contain such terms as may be established in or
pursuant to the related Resolution (subject to Section 2.1) or in any indenture
supplemental hereto providing for the issuance of such Notes or specified in the
form of such Notes to the extent permitted below. Prior to the issuance of any
Refinancing Notes, any or all of the following, as applicable, with respect to
the related issue of Refinancing Notes shall have been determined by the Issuer
and set forth in such Resolution and in any indenture supplemental hereto
providing for the issuance of such Notes or specified in the form of such Notes,
as the case may be:

(i) the class of Notes to be refinanced by such Refinancing Notes;

(ii) the aggregate principal amount of each class of Refinancing Notes that may
be issued in respect of such Refinancing;

(iii) the proposed date of such Refinancing;

(iv) the Final Legal Maturity Date of each class of such Refinancing Notes;

(v) the rate at which such Refinancing Notes shall bear interest or the method
by which such rate shall be determined;

(vi) the denomination or denominations in which any class of such Refinancing
Notes shall be issuable;

(vii) whether such Refinancing Notes will be subject to redemption pursuant to
Section 3.9(c);

 

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(viii) whether any such Refinancing Notes are to be issuable initially in
temporary or permanent global form and, if so, whether beneficial owners of
interests in any such permanent global Refinancing Note may exchange such
interests for Refinancing Notes of such class and of like tenor of any
authorized form and denomination and the circumstances under which any such
exchanges may occur, if other than in the manner provided in Section 2.7, and
the circumstances under which and the place or places where any such exchanges
may be made and the identity of any initial depositary therefor; and

(ix) any other terms, conditions, rights and preferences (or limitations on such
rights and preferences) relating to the class of Refinancing Notes (which terms
shall comply with Applicable Law and not violate any restrictions of this
Indenture).

(d) If any of the terms of any issue of Refinancing Notes are established by
action taken pursuant to one or more Resolutions, such Resolutions shall be
delivered to the Trustee setting forth the terms of such Refinancing Notes.

Section 2.16 Class B Notes.

(a) Subject to Section 2.16(b), Section 2.16(c) and Section 2.16(d), the Issuer
may issue Class B Notes pursuant to this Indenture (a “Class B Issuance”) for
any purpose, including, at the option of the Issuer, for the purpose of funding
a redemption of the Class A Notes, in whole or in part. Each Class B Issuance
shall be authorized pursuant to one or more Resolutions. Each Class B Note shall
be designated generally as a Note for all purposes under this Indenture. Each
Class B Note shall have such further designations added or incorporated in such
title as specified in the related Resolution or in any indenture supplemental
hereto providing for the issuance of such Notes or specified in the form of such
Notes, as the case may be. There are no limitations on the use of proceeds from
the issuance of such Class B Notes, including making dividends or distributions
to the Equityholders. If the proceeds of the Class B Notes are being used to
redeem the Class A Notes, in whole or in part, the Class B Notes shall be issued
on the Payment Date on which the Optional Redemption of the Class A Notes being
refinanced is to occur as provided in Section 3.10.

(b) If the proceeds of the Class B Notes are being used to redeem any Class A
Notes, such redemption shall be effected as an Optional Redemption pursuant to
Section 3.9(b). On the date of any such Optional Redemption, the Issuer shall
issue and sell an aggregate principal amount of Class B Notes in an amount not
less than the amount sufficient to pay in full the applicable Redemption Price
of the Notes being redeemed thereby plus the Transaction Expenses relating
thereto. The proceeds of each sale of Class B Notes shall be used to make the
deposit required by Section 3.10, to the extent applicable, to pay such
Transaction Expenses and/or for such other purposes, if any, as shall be
specified in the Resolution authorizing the issuance of such Class B Notes.
Subject to Section 3.10(b), once a notice of Redemption in respect of any Class
B Issuance is published in accordance with Section 3.10(a), each class of Notes
to which such notice applies shall become due and payable on the Redemption Date
stated in such notice at their Redemption Price.

(c) Each Class B Note shall contain such terms as may be established in or
pursuant to the related Resolution (subject to Section 2.1) or in any indenture
supplemental hereto providing for the issuance of such Notes or specified in the
form of such Notes to the

 

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extent permitted herein, and shall be subordinate to the Class A Notes to the
extent provided in this Indenture. Prior to the issuance of the Class B Notes,
any or all of the following, as applicable, with respect to the related Class B
Issuance shall have been determined by the Issuer and set forth in such
Resolution and in any indenture supplemental hereto or specified in the form of
such Class B Notes, as the case may be, with respect to the Class B Notes to be
issued:

(i) the aggregate principal amount of any such Class B Notes that may be issued;

(ii) the proposed date of such Class B Issuance;

(iii) the Final Legal Maturity Date of any such Class B Notes;

(iv) whether any such Class B Notes are to have the benefit of any reserve
account and, if so, the amount and terms thereof;

(v) the rate at which such Class B Notes shall bear interest or the method by
which such rate shall be determined;

(vi) the denomination or denominations in which such Class B Notes shall be
issuable;

(vii) whether such Class B Notes will be subject to redemption pursuant to
Section 3.9(c);

(viii) whether any such Class B Notes are to be issuable initially in temporary
or permanent global form and, if so, whether beneficial owners of interests in
any such permanent global Class B Note may exchange such interests for Class B
Notes of like tenor and of any authorized form and denomination and the
circumstances under which any such exchanges may occur, if other than in the
manner provided in Section 2.7, and the circumstances under which and the place
or places where any such exchanges may be made and the identity of any initial
depositary therefor; and

(ix) any other terms, conditions, rights and preferences (or limitations on such
rights and preferences) relating to Class B Notes (which terms shall comply with
Applicable Law and not violate any restrictions of this Indenture).

(d) If any of the terms of any issue of Class B Notes are established by action
taken pursuant to one or more Resolutions, such Resolutions shall be delivered
to the Trustee setting forth the terms of such Class B Notes.

Section 2.17 Limitation on Number of Holders of Notes. The Issuer shall not
issue, and the Registrar shall not issue or exchange or register the transfer
of, any Note if, immediately after such issuance, exchange or transfer, there
would be more than 95 Noteholders (in the case of Notes that are Definitive
Notes) or Beneficial Holders (in the case of Notes that are Global Notes), taken
together in the aggregate, and any purported issuance, exchange or transfer in
violation of this Section 2.17 shall be void ab initio and result in the
purported Noteholder or Beneficial Holder not being treated as a Noteholder or
Beneficial Holder, as the case may be, for

 

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purposes of this Indenture. The Issuer shall (i) immediately notify the
Registrar if the Issuer has actual knowledge that there are more than 95
Noteholders and Beneficial Holders, taken together in the aggregate (an “Excess
Holder Event”), and (ii) furnish to the Registrar such additional information
available to it as the Registrar may reasonably request from time to time to
permit the Registrar to prepare the Approved Holder Lists, the DTC Lists, the
Actual Beneficial Holder Lists and the Escrow Lists (collectively, the “Holder
Lists”) pursuant to Section 2.5(d). In determining whether an Excess Holder
Event has occurred, or for any other purpose under this Indenture, the Registrar
may assume without further inquiry that the only Noteholders and Beneficial
Holders that it must take into consideration are those named in the most
recently updated Holder Lists maintained by the Registrar. For the avoidance of
doubt, neither the Trustee nor the Registrar is required to inquire into or
update the Holder Lists except as required by Section 2.5(d).

ARTICLE III

ACCOUNTS; PRIORITY OF PAYMENTS

Section 3.1 Establishment of Accounts.

(a) The Issuer will (or will cause any Servicer, acting on behalf of the Issuer,
pursuant to the Servicing Agreement, to) establish and maintain with the
Operating Bank on its books and records in the name of the Issuer, subject to
the Liens established under this Indenture, (i) a collection account (the
“Collection Account”), (ii) a redemption account (the “Redemption Account”),
(iii) a capital contribution account (the “Capital Account”), (iv) an escrow
account (the “Escrow Account”), (v) an interest reserve account (the “Interest
Reserve Account”), (vi) a tax distribution escrow account (the “Tax Distribution
Escrow Account”) and (vii) any additional accounts the establishment of which is
set forth in a Resolution delivered by the Issuer to the Servicer (if any) and
the Trustee, in each case at such time as is set forth in this Section 3.1 or in
such Resolution. Each Account shall be established and maintained as an Eligible
Account so as to create, perfect and establish the priority of the Liens
established under this Indenture in such Account and all cash, Eligible
Investments and other property from time to time deposited therein and otherwise
to effectuate the Liens under this Indenture.

(b) The Trustee as the Operating Bank shall have sole dominion and control over
the Accounts (including, among other things, the sole power to direct
withdrawals or transfers from the Accounts and to direct the investment and
reinvestment of funds in the Accounts, subject to Section 3.2). The Trustee as
the Operating Bank shall make withdrawals and transfers from the Accounts in
accordance with the terms of this Indenture based on the Relevant Information
and as calculated by it pursuant to this Indenture. Each of the Issuer and the
Trustee as the Operating Bank acknowledges and agrees that the Accounts are
“deposit accounts” or “investment property” within the meaning of Section 9-102
of the UCC and that the Trustee has “control”, for purposes of Section 9-314 of
the UCC, of Accounts that are maintained with the Trustee as the Operating Bank.
The Issuer agrees that, if any Account is established or maintained with any
Operating Bank other than the Trustee, the Issuer shall cause (or direct any
Servicer to cause) such Operating Bank to enter into an agreement with the
Trustee and the Issuer (and any Servicer) pursuant to which such Operating Bank
agrees to comply with any and all instructions of the Trustee directing the
disposition, investment and reinvestment of funds in all Accounts maintained
with such Operating Bank without the further consent of the Issuer (or

 

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any Servicer), and the Issuer shall take such other actions as are reasonably
required by the Trustee to establish its “control”, for purposes of
Section 9-314 of the UCC, over any such Accounts. The Trustee as the Operating
Bank hereby confirms that it has established the following accounts in the name
of the Issuer: (a) the Collection Account (account number 128354-000); (b) the
Redemption Account (account number 128354-002); (c) the Capital Account (account
number 128354-004); (d) the Escrow Account (account number 128354-003); (e) the
Interest Reserve Account (account number 128354-001); and (f) the Tax
Distribution Escrow Account (account number 128354-005) (collectively, the
“Closing Day Accounts”). The Trustee, the Issuer and the Trustee as the
Operating Bank hereby agree that (i) the Trustee as the Operating Bank shall
comply with all instructions originated by the Trustee directing the disposition
of funds in any Closing Day Account or any other Account maintained with the
Trustee as the Operating Bank and all entitlement orders originated by the
Trustee with respect to any Closing Day Account or any other Account, in each
case without further consent by the Issuer, and (ii) the jurisdiction of the
Trustee as the Operating Bank for purposes of the UCC shall be the State of New
York.

(c) If, at any time, any Account ceases to be an Eligible Account, the Issuer
will (or will cause any Servicer or an agent thereof to), within ten Business
Days, establish a new Account meeting the conditions set forth in this
Section 3.1 in respect of such Account and transfer any cash or investments in
the existing Account to such new Account, and, from the date such new Account is
established, it shall have the same designation as the existing Account. If the
Operating Bank should change at any time, then the Issuer will (or will cause
any Servicer, acting on behalf of the Issuer, to) thereupon promptly establish
replacement Accounts as necessary at the successor Operating Bank and transfer
the balance of funds in each Account then maintained at the former Operating
Bank pursuant to the terms of the Servicing Agreement to such successor
Operating Bank.

(d) The Issuer will (or will cause any Servicer to) maintain the Collection
Account at the Operating Bank not later than the Closing Date, and the
Collection Account shall bear a designation clearly indicating that the funds or
other assets deposited therein are held for the benefit of the Trustee. Except
as expressly provided herein, all Collections shall be deposited in the
Collection Account and transferred therefrom in accordance with the terms of
this Indenture. No funds shall be deposited in the Collection Account that do
not constitute Collections, except as expressly provided in this Indenture,
without the prior written consent of the Trustee.

(e) The Issuer will (or will cause any Servicer to) maintain the Redemption
Account at the Operating Bank that shall bear a designation clearly indicating
that the funds or other assets deposited therein are held for the benefit of the
Trustee, who shall hold such amounts for the benefit of the Noteholders of Notes
that are the subject of such Redemption. All amounts received for the purpose of
any such Redemption shall be deposited in such Redemption Account and shall be
held in such Account until such amounts are applied to pay the Redemption Price
of such Notes (together with related Expenses) and such Notes are cancelled by
the Trustee.

 

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(f) The Issuer will (or will cause any Servicer to) maintain the Capital Account
at the Operating Bank not later than the Closing Date, and the Capital Account
shall bear a designation clearly indicating that the funds or other assets
deposited therein are held for the benefit of the Trustee. Except as expressly
provided herein, all capital contributions made to the Issuer shall be deposited
and held in the Capital Account and transferred therefrom (i) to the Noteholders
in payment of any Interest Amount in accordance with Section 3.8, (ii) on the
Final Legal Maturity Date, to the Noteholders in payment of the Outstanding
Principal Balance in accordance with Section 3.8, (iii) to the Redemption
Account only to the extent specifically provided for in any written notice of an
Optional Redemption delivered to the Trustee pursuant to Section 3.9(b) and
(iv) to the Equityholders only to the extent permitted by Section 5.2(b) (solely
as relates to the issuance of Capital Securities of the Issuer in accordance
with such Section 5.2(b)).

(g) The Issuer will (or will cause such Servicer to) maintain the Escrow Account
at the Operating Bank in the name of the Trustee that shall bear a designation
clearly indicating that the funds or other assets deposited therein are held for
the benefit of any such Noteholder, Agent Member or Beneficial Holder. All
amounts withheld from such Noteholder, Agent Member or Beneficial Holder
pursuant to Section 2.5(d) shall be deposited in such Escrow Account and shall
be held in such Escrow Account until such amounts are distributed as provided in
Section 2.5(d).

(h) The Issuer will (or will cause such Servicer to) maintain the Interest
Reserve Account at the Operating Bank that shall bear a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Trustee. Amounts shall be deposited into the Interest Reserve Account only
pursuant to Section 3.3(a)(iii). All such amounts shall be held in such Interest
Reserve Account and transferred therefrom only pursuant to Section 3.8.

(i) The Issuer will (or will cause such Servicer to) maintain the Tax
Distribution Escrow Account at the Operating Bank that shall bear a designation
clearly indicating that the funds deposited therein are held for the benefit of
the Trustee. Amounts shall be deposited into the Tax Distribution Escrow Account
only pursuant to Section 3.7(a)(iii). All such amounts shall be held in such Tax
Distribution Escrow Account and transferred therefrom only pursuant to
Section 3.11.

Section 3.2 Investments of Cash. The Issuer (or any Servicer, on its behalf) may
direct the Trustee in writing to invest and reinvest the funds on deposit in the
Accounts in Eligible Investments, to the extent such Eligible Investments are
available to the relevant Operating Bank, and advise the Trustee in writing of
any depository institution or trust company described in the proviso to the
definition of Eligible Investments; provided, however, that, so long as an Event
of Default has occurred and is continuing, the Trustee shall direct each
Operating Bank to invest such amount in Eligible Investments described in clause
(a) of the definition thereof from the time of receipt thereof until such time
as such amounts are required to be distributed pursuant to the terms of this
Indenture. In the absence of written direction delivered to the Trustee from the
Issuer (or any Servicer), the Trustee shall direct each Operating Bank to invest
any funds in Eligible Investments described in clause (a) of the definition
thereof. The Trustee shall direct each Operating Bank to make such investments
and reinvestments in accordance with the terms of the following provisions:

(a) the Eligible Investments shall have maturities and other terms such that
sufficient funds shall be available to make required payments pursuant to this
Indenture on the Business Day immediately preceding the next occurring Payment
Date after such investment is made;

 

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(b) if any funds to be invested are received in the Accounts after 1:00 p.m.,
New York City time, on any Business Day, such funds shall, if possible, be
invested in overnight Eligible Investments;

(c) all interest and earnings on Eligible Investments held in the Accounts shall
be invested in Eligible Investments on an overnight basis and credited to the
appropriate Account until the next Payment Date; and

(d) the Issuer acknowledges that regulations of the U.S. Comptroller of the
Currency grant the Issuer the right to receive confirmations of security
transactions as they occur, and the Issuer specifically waives receipt of such
confirmations to the extent permitted by Applicable Law and acknowledges that
the Operating Bank will instead furnish monthly cash transaction statements that
will detail all investment transactions as set forth in this Indenture.

Section 3.3 Closing Date Deposits; Withdrawals and Transfers.

(a) On the Closing Date, the Trustee shall, subject to the receipt of written
direction from the Issuer, upon receipt of the Note Purchase Price from the sale
by the Issuer of the Original Class A Notes, make the following payments from
such proceeds in the amounts so directed by the Issuer:

(i) to such Persons and in such amounts as shall be specified by the Issuer,
such Transaction Expenses as shall be due and payable in connection with the
issuance and sale of the Notes;

(ii) to Indevus, in accordance with the Purchase and Sale Agreement, the amount
by which the Note Purchase Price exceeds the sum of (x) such Transaction
Expenses and (y) the Initial Interest Reserve Amount; and

(iii) to the Interest Reserve Account, the Initial Interest Reserve Amount.

(b) On the date of issuance of any Class B Notes or any Refinancing Notes, the
Trustee shall, subject to the receipt of written direction from the Issuer upon
receipt of the proceeds of the sale by the Issuer of such Notes, make such
payments and transfers as shall be specified in this Indenture, the related
Resolution or any indenture supplemental hereto in respect of such Notes, copies
of which Resolution and indenture supplemental hereto shall be attached to such
written direction.

(c) The Trustee shall hold all funds received on or prior to the Closing Date
from the Note Purchasers in trust for the Note Purchasers pending the Closing
Date. Upon receipt by the Trustee of the aggregate Note Purchase Price from all
Note Purchasers, the Trustee shall disburse the Note Purchase Price in
accordance with this Section 3.3. If the aggregate Note Purchase Price shall not
have been received by the Trustee by 3:30 p.m. (New York City time)

 

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on the Closing Date, or if the closing of the transactions contemplated by the
Note Purchase Agreements shall not otherwise be capable of being consummated by
3:30 p.m. (New York City time) on the Closing Date, then each Note Purchaser who
has paid its respective portion of the Note Purchase Price shall have the right
to instruct the Trustee at or after 3:30 p.m. (New York City time) on the
Closing Date to return such portion of the Note Purchase Price to such Note
Purchaser prior to the close of business on the Closing Date or as soon
thereafter as reasonably practicable.

Section 3.4 Capital Contributions. The Issuer will immediately forward any
capital contributions received by it from any Equityholder for deposit in the
Capital Account.

Section 3.5 Calculation Date Calculations.

(a) As soon as reasonably practicable after each Calculation Date (a “Relevant
Calculation Date”), but in no event later than 12:00 noon (New York City time)
on the second Business Day prior to the immediately succeeding Payment Date, the
Calculation Agent shall, based on the Calculation Date Information received by
the Calculation Agent, and based on information known to it or Relevant
Information provided to it, make the following determinations and calculations
(and each of the Trustee and the Issuer (for itself and on behalf of any
Servicer) agrees to provide any Relevant Information reasonably requested by the
Calculation Agent for the purpose of making such determinations and
calculations):

(i) the Available Collections Amount for such Payment Date;

(ii)(x) the amount of Collections received during the period commencing on the
day immediately following the Calculation Date that immediately preceded such
Relevant Calculation Date and ending on such Relevant Calculation Date and
(y) the amount, if any, to be transferred from the Interest Reserve Account as
of the Relevant Calculation Date to the Collection Account on such Payment Date
in accordance with Section 3.8;

(iii) the balance of funds on deposit in each Account other than the Collection
Account on such Relevant Calculation Date and the amount of interest and
earnings (net of losses and investment expenses), if any, on investments of
funds on deposit therein from the day immediately following the Calculation Date
that immediately preceded such Relevant Calculation Date and ending on such
Relevant Calculation Date;

(iv) the balance of funds on deposit in the Collection Account on such Relevant
Calculation Date and the amount of interest and earnings (net of losses and
investment expenses), if any, on investments of funds on deposit therein from
the day immediately following the Calculation Date that immediately preceded
such Relevant Calculation Date and ending on such Relevant Calculation Date;

(v)(x) all other Expenses due and payable on such Payment Date and not
previously paid or reimbursed, and to be paid or reimbursed, pursuant to
Section 3.7(a)(i), in the amounts shown on all supporting documentation therefor
and attached to the Calculation Date Information received by the Calculation
Agent, and (y) all Expenses

 

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previously reimbursed and paid to the Issuer in respect of Expenses pursuant to
Section 3.7(c) from the day immediately following the Calculation Date that
immediately preceded such Relevant Calculation Date and ending on such Relevant
Calculation Date;

(vi) the applicable interest rate on each class of Floating Rate Notes
determined on the Reference Date for the Interest Accrual Period beginning on
such Payment Date and the Interest Amount (including any Additional Interest) on
each class of Floating Rate Notes and Fixed Rate Notes for such Payment Date;

(vii) if such Payment Date is a Redemption Date on which a Redemption of Notes
is scheduled to occur, the amount necessary to pay the Redemption Price of the
Notes to be repaid on such Redemption Date and the Redemption Premium, if any,
to be paid as part of such Redemption Price;

(viii)(x) the amount of the Tax Distribution, if any, to be made on such Payment
Date, provided such Tax Distribution is being made in accordance with
Section 3.7(a)(iii), or (y) the amount, if any, to be transferred to the Tax
Distribution Escrow Account on such Payment Date in accordance with
Section 3.7(a)(iii);

(ix) the difference, if any, between the Interest Amount due to the Noteholders
of Class A Notes on such Payment Date and the Available Collections Amount for
such Payment Date, after giving effect to the payment of all Expenses to be paid
or reimbursed on such Payment Date pursuant to Section 3.7(a)(i) (such
difference, a “Shortfall”), and, with respect to each Shortfall, the amount to
be withdrawn from the Interest Reserve Account and/or the Capital Account, if
any, determined as provided in Section 3.8;

(x) the Outstanding Principal Balance of each class of Notes on such Payment
Date immediately prior to any principal payment with respect to the Outstanding
Principal Balance on such Payment Date and the amount of any principal payment
with respect to the Outstanding Principal Balance to be made in respect of each
class of Notes on such Payment Date, taking into account the other payments to
be made on such Payment Date entitled to priority pursuant to Section 3.7;

(xi) the amounts, if any, distributable to the Issuer on such Payment Date
pursuant to Section 3.7(a)(viii); and

(xii) any other information, determinations and calculations reasonably required
in order to give effect to the terms of this Indenture and the other Deal
Documents.

(b) Following the calculations and determinations by the Calculation Agent
described in Section 3.5(a), and not later than 1:00 p.m., New York City time,
on the second Business Day prior to the immediately succeeding Payment Date, the
Calculation Agent shall provide to each of the Issuer, any Servicer and the
Trustee a calculation report (a “Calculation Report”) listing such
determinations and calculations and the amount of the Available Collections
Amount to be applied on such Payment Date to make each of the payments and
transfers contemplated by Section 3.7(a) or Section 3.9(a), as applicable, and
setting forth the payments to be made in respect of the Notes and any Tax
Distributions. The calculations set forth in each Calculation Report shall be
conclusive and binding on each of the Issuer, any Servicer, the Trustee and each
Noteholder, absent manifest error.

 

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Section 3.6 Payment Date First Step Transfers. On each Payment Date, the Trustee
shall transfer from any Account (other than the Collection Account, the Capital
Account and the Tax Distribution Escrow Account) to the Collection Account the
amount of interest and earnings (net of losses and investment expenses), if any,
earned as a result of investments of funds on deposit therein from the day
immediately following the Calculation Date that immediately preceded the
Relevant Calculation Date and ending on the Relevant Calculation Date.

Section 3.7 Payment Date Second Step Withdrawals.

(a) Subject to Section 3.7(e), on each Payment Date, after the applicable
transfers provided for in Section 3.6 have been made, the Trustee shall
distribute from the Collection Account the amounts set forth below in the order
of priority set forth below but, in each case, only to the extent that all
amounts then required to be paid ranking prior thereto have been paid in full:

(i) first, to the payment of all Expenses not previously paid or reimbursed, in
the amounts shown in all supporting documentation attached to the Calculation
Date Information received by the Calculation Agent;

(ii) second, to the Trustee for distribution to the Noteholders of the Class A
Notes, the ratable payment of the Interest Amount then due and payable on the
Class A Notes, taking into account any amounts previously paid pursuant to
Section 2.5(e) and any adjustment to be made pursuant to Section 3.7(e) and any
amounts to be paid pursuant to Section 3.8, in each case on such Payment Date;

(iii) third, to the Equityholders, the Tax Distribution; provided, that no such
Tax Distribution shall be made if (x) an Event of Default or a Material Adverse
Development has occurred and is continuing or (y) the amount of Royalties in the
Collection Account in respect of such Payment Date prior to application of this
Section 3.7 on such Payment Date is less than the amount set forth on Schedule A
in respect of such Payment Date; provided, further, that if none of the events
described in clause (x) or clause (y) have occurred but a Material Adverse
Special Development has occurred and is continuing (or any Noteholder or
Beneficial Holder has provided written notice to the Trustee that it believes
that one or more clauses of the definition of Material Adverse Special
Development has occurred and is continuing), then the amount of such Tax
Distribution shall be distributed to the Tax Distribution Escrow Account pending
any further distribution pursuant to Section 3.11;

(iv) fourth, to the Trustee for distribution to the Noteholders of the Class A
Notes, principal payments with respect to the Outstanding Principal Balance on
the Class A Notes (without Premium or penalty), allocated pro rata in proportion
to the Outstanding Principal Balance of such Class A Notes held by such
Noteholders, until the Outstanding Principal Balance of such Class A Notes has
been paid in full;

 

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(v) fifth, after the Class A Notes have been paid in full, to the Trustee for
distribution to the Noteholders of the Class B Notes, if any, the Interest
Amount on the Class B Notes in accordance with their terms;

(vi) sixth, after the Class A Notes have been paid in full, to the Trustee for
distribution to the Noteholders of the Class B Notes, if any, principal payments
with respect to the Outstanding Principal Balance of the Class B Notes in
accordance with their terms until the Class B Notes have been paid in full;

(vii) seventh, after the Notes have been paid in full, to the ratable payment of
all other obligations under this Indenture until all such amounts are paid in
full; and

(viii) eighth, after the Notes have been paid in full, to the Issuer, all
remaining amounts.

(b) To the extent the Issuer receives amounts from the Trustee from the
Collection Account pursuant to Section 3.7(a)(viii), such amounts may be
distributed by the Issuer to the Equityholders (or as otherwise directed by the
Equityholders or any Person designated by the Equityholders to give such
directions) in their sole discretion.

(c) Notwithstanding anything herein to the contrary, so long as no Event of
Default shall have occurred and be continuing, the Calculation Agent shall, on
the 15th day of each calendar month (other than any month in which a Payment
Date falls), reimburse and pay to the Issuer (or such other appropriate Person
identified at the written instruction of the Issuer), from the Collection
Account, an amount equal to the lesser of (i) all Expenses not previously paid
or reimbursed and (ii) the balance of the Collection Account, in either case
upon delivery to the Calculation Agent by the Issuer, not less than three
Business Days prior to such 15th day, of supporting documentation therefor in
writing.

(d) The provisions contained in Section 3.7(b) may not be amended, modified,
waived or terminated (including pursuant to any termination of this Indenture)
without the prior written consent of the Equityholders materially and adversely
affected thereby, and the provisions contained in Section 3.7(b) shall survive
the termination of this Indenture. The parties hereto specifically agree that
each Equityholder materially and adversely affected thereby (i) is and shall be
an express third-party beneficiary of the provisions of Section 3.7(b) and
(ii) shall have the right to enforce any provision of Section 3.7(b).

(e) Notwithstanding anything herein to the contrary, the priority of payments
set forth in Section 3.7(a) shall be adjusted to give effect to (i) any
inaccuracy set forth in any report of an accounting firm pursuant to
Section 6.15(b), such that each Person shall be restored on the immediately
succeeding Payment Date (or, if necessary, the immediately succeeding Payment
Dates) to the cash flow position that such Person would have been in had the
accurate amounts set forth in such report been paid in accordance with
Section 3.7(a) on the relevant prior Payment Dates, and (ii) the amount by which
any Audit Expenses exceed $75,000 per annum (to the extent that such excess
amount is to be borne by the Noteholders in accordance with Section 6.15(b)),
such that any payments to the Noteholders pursuant to Section 3.7(a) shall first
be offset against the payment of such Audit Expenses; provided, that the Issuer
(or any Servicer) shall notify the Trustee in writing of the occurrence of the
events described in the proviso to Section 6.15 and an itemization of the impact
on the cash flows pursuant to Section 3.7(a).

 

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Section 3.8 Interest Reserve Account and Capital Account; Shortfalls. If the
Calculation Agent has determined that a Shortfall exists pursuant to the
Calculation Report with respect to any Payment Date and there is a positive
balance in the Interest Reserve Account on the Relevant Calculation Date
immediately preceding such Payment Date, then on such Payment Date the Trustee
shall withdraw from the Interest Reserve Account an amount equal to the lesser
of the Shortfall and the balance in the Interest Reserve Account and distribute
it to the Noteholders of the Class A Notes in payment of the Interest Amount;
provided, that, if the amount available in the Interest Reserve Account (if any)
is less than the amount of such Shortfall and there is a positive balance in the
Capital Account on the Relevant Calculation Date immediately preceding such
Payment Date, then on such Payment Date the Trustee shall withdraw from the
Capital Account an amount equal to the lesser of (i) the amount by which the
Shortfall exceeds the amount, if any, withdrawn from the Interest Reserve
Account and (ii) the balance in the Capital Account and distribute it to the
Noteholders of the Class A Notes in payment of the Interest Amount; provided,
further, that the Trustee shall (a) make such a withdrawal from the Capital
Account in respect of not more than six Payment Dates in total prior to the
Final Legal Maturity Date and in respect of not more than any three consecutive
Payment Dates and (b) distribute any funds remaining in the Capital Account to
the Equityholders in the event that withdrawals from the Capital Account have
been made in respect of six Payment Dates. Notwithstanding the foregoing, if, on
the Final Legal Maturity Date, (x) the portion of the Available Collections
Amount available to pay in full the Outstanding Principal Balance on the Class A
Notes, after giving effect to the other payments to be made on the Final Legal
Maturity Date and entitled to priority pursuant to Section 3.7, are insufficient
to pay in full the Outstanding Principal Balance on the Class A Notes, and
(y) there is a positive balance in the Capital Account after giving effect to
any withdrawal therefrom in respect of any Shortfall, then on the Final Legal
Maturity Date the Trustee shall withdraw from the Capital Account an amount
equal to the lesser of the Outstanding Principal Balance on the Class A Notes
and the balance of the Capital Account and distribute it to the Noteholders of
the Class A Notes in payment of all or any portion of the Outstanding Principal
Balance on the Class A Notes.

On August 5, 2010, any funds remaining in the Interest Reserve Account (after
any application of the prior paragraph on the August 5, 2010 Payment Date) shall
be transferred to the Collection Account and included in the Available
Collections Amount and applied as provided in Section 3.7 on the August 5, 2010
Payment Date.

Section 3.9 Redemptions.

(a) On any Payment Date on which any class of Notes is to be the subject of a
Redemption, in whole or in part, the Trustee shall distribute the amounts in the
applicable Redemption Account as provided herein and in the applicable
Resolution, including:

(i) to the extent Class B Notes or Refinancing Notes were issued for the purpose
of funding such Redemption, paying to such Persons as shall be specified by the
Issuer such Transaction Expenses as shall be due and payable in connection with
the issuance and sale of the applicable Class B Notes or Refinancing Notes;

 

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(ii) after application of Section 3.7 and Section 3.8, remitting to the
Noteholders of such class of Notes, in accordance with the Resolution
authorizing such Redemption, an amount equal to the Redemption Price plus
Premium, if any, allocated, in the event of a Redemption of such Notes in part,
pro rata in proportion to the Outstanding Principal Balance of such Notes held
by such Noteholders; and

(iii) making such other distributions and payments as shall be authorized and
directed by the Resolution and indentures supplemental hereto executed in
connection with such Redemption.

(b) Subject to the provisions of Section 3.9(c) and Section 3.10, on any Payment
Date, to the extent that any class of Notes will remain Outstanding on such
Payment Date after application of Section 3.7 and Section 3.8, the Issuer may
elect to redeem such class of Notes, in whole, but not in part, out of the
proceeds of the Refinancing Notes and any funds in the Interest Reserve Account
or the Capital Account in the case of a Refinancing of such class of Notes, or,
in whole or in part, out of amounts available in the Redemption Account for such
purpose, if any, including the proceeds of any Class B Notes (but excluding in
the case of a Redemption in part any funds in the Interest Reserve Account or
the Capital Account), in each case, at the Redemption Price (any such
redemption, an “Optional Redemption”). The Issuer shall give written notice of
any such Optional Redemption to the Trustee and any Servicer not later than five
Business Days prior to the date on which notice is to be given to Noteholders in
accordance with Section 3.10(a) (unless the Trustee and any such Servicer agree
to waive or limit the requirement for such notice). Such written notice to the
Trustee shall include a copy of the Resolution authorizing such Optional
Redemption and shall set forth the relevant information regarding such Optional
Redemption, including the information to be included in the notice given
pursuant to Section 3.10(a).

(c) An indenture supplemental hereto providing for the issuance of any Class B
Notes or Refinancing Notes may authorize one or more redemptions, in whole or in
part, of such Notes, on such terms and subject to such conditions as shall be
specified in such indenture supplemental hereto; provided, that, while any
Class A Notes are Outstanding, such Class B Notes may only be redeemed by the
Issuer with proceeds from Refinancing Notes in respect of such Class B Notes or
capital contributions from the Equityholders.

Section 3.10 Procedure for Redemptions.

(a) The Trustee (or any Servicer acting as its agent (or any authorized agent of
any such Servicer)) shall give written notice in respect of any Redemption of
any class of Notes under Section 3.9 to each Noteholder of such Notes at least
30 days but not more than 60 days before such Redemption Date. Each notice in
respect of a Redemption given pursuant to this Section 3.10(a) shall state
(A) the expected applicable Redemption Date, (B) the arrangements for making
payments in respect of such Redemption, (C) the projected Redemption Price of
the Notes to be redeemed, (D) in the case of a Redemption of the Notes of any
class in part, the portion of the Outstanding Principal Balance of the Notes
that is expected to be redeemed, (E) that Notes to be redeemed in a Redemption
in whole must be surrendered (which action may be taken by any Noteholder or its
authorized agent) to the Trustee to collect the Redemption Price on such Notes
and (F) that, unless the Issuer fails to pay the Redemption Price, interest on
Notes called for Redemption in whole shall cease to accrue on and after the
Redemption Date. If mailed in the manner herein provided, the notice shall be
conclusively presumed to have been given whether or not the Noteholder receives
such notice.

 

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(b) If, at the time of the mailing of any notice in respect of a Redemption, the
Issuer shall not have irrevocably directed the Trustee to apply funds then on
deposit with the Trustee or held by the Issuer and available to be used for such
Redemption to redeem all of the Notes called for Redemption, such notice, at the
election of the Issuer, may state that it is conditional and subject to the
receipt of the redemption moneys in an amount sufficient to pay the principal of
and Premium, if any, and interest on the Notes being redeemed by the Trustee on
or before the Redemption Date and that such notice shall be of no force and
effect unless such moneys are so received on or before such Redemption Date.

(c) If notice in respect of a Redemption for any Notes shall have been given as
provided in Section 3.10(a) and such notice shall not contain the language
permitted at the Issuer’s option under Section 3.10(b), such Notes shall become
due and payable on the Redemption Date at the Corporate Trust Office at the
applicable Redemption Price, and, unless there is a default in the payment of
the applicable Redemption Price, interest on such Notes shall cease to accrue.
Upon presentation and surrender of such Notes at the Corporate Trust Office,
such Notes shall be paid and redeemed at the applicable Redemption Price. On or
before any Redemption Date in respect of such a Redemption, the Issuer shall, to
the extent an amount equal to the Redemption Price of such Notes (and any
Refinancing Expenses relating thereto as of the Redemption Date) is not then
held by the Issuer or on deposit in the Redemption Account, deposit or cause to
be deposited in the Redemption Account an amount in immediately available funds
equal to such amount.

(d) If notice in respect of a Redemption for any Notes shall have been given as
provided in Section 3.10(a) and such notice shall contain the language permitted
at the Issuer’s option under Section 3.10(b), such Notes shall become due and
payable on the Redemption Date at the Corporate Trust Office at the applicable
Redemption Price and interest on such Notes shall cease to accrue; provided,
that, in each case, the Issuer shall have deposited with the Trustee or a Paying
Agent on or prior to 11:00 a.m. (New York City time) on the Redemption Date an
amount sufficient to pay the Redemption Price. Upon the Issuer making such
deposit and presentation and surrender of such Notes at the Corporate Trust
Office, such Notes shall be paid and redeemed at the applicable Redemption
Price. If the Issuer shall not make such deposit on or prior to 11:00 a.m. (New
York City time) on the Redemption Date, the notice in respect of Redemption
shall be of no force and effect, and the principal on such Notes or specified
portions thereof shall continue to bear interest as if such notice in respect of
Redemption had not been given.

(e) All Notes that are redeemed will be surrendered to the Trustee for
cancellation and may not be reissued or resold.

Section 3.11 Tax Distribution Escrow Account. Any funds deposited into the Tax
Distribution Escrow Account pursuant to Section 3.7(a)(iii) shall be distributed
to the Equityholders within five Business Days of written notice from the
Equityholders to the Trustee certifying that (a) if such funds were deposited
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reason of clause (i) or clause (ii) of the definition of Material Adverse
Special Development, a court of competent jurisdiction has determined that the
occurrence of such Material Adverse Special Development did not have and would
not reasonably be expected to have a material adverse effect on net sales of the
relevant Product in the Territory and the Royalties, (b) if such funds were
deposited into the Tax Distribution Escrow Account by reason of clause (iii) of
the definition of Material Adverse Special Development, a patent licensed to
Indevus in respect of SANCTURA XRTM is held valid by a court of competent
jurisdiction or (c) Noteholders of 100% of the Outstanding Principal Balance of
the class of Notes have consented to such distribution to the Equityholders.

ARTICLE IV

DEFAULT AND REMEDIES

Section 4.1 Events of Default. Each of the following events or occurrences shall
constitute an “Event of Default” hereunder with respect to any class of Notes
(except for clauses (a), (b), (c) and (d) below in which the potential events or
occurrences that would constitute an Event of Default are specific to certain
classes of Notes, in which case such Event of Default shall be constituted only
with respect to such classes of Notes (and not all classes of Notes)), and each
such Event of Default shall be deemed to exist and continue so long as, but only
so long as, it shall not have been waived or remedied, as applicable:

(a)(i) failure to pay interest on the Class A Notes due on any Payment Date
(other than the Final Legal Maturity Date or any Redemption Date) within five
days of such Payment Date, but only to the extent of the Available Collections
Amount available for interest payments pursuant to the priority of payments in
Section 3.7, any funds in the Interest Reserve Account and any capital
contributed to the Issuer by the Equityholders as described in Section 3.1(f)
and available for interest payments pursuant to Section 3.8, or (ii) failure to
pay principal of the Class A Notes due on any Payment Date (other than the Final
Legal Maturity Date or any Redemption Date) within five days of such Payment
Date, but only to the extent of the Available Collections Amount available for
principal payments pursuant to the priority of payments in Section 3.7;

(b)(i) failure to pay interest on the Class A Notes due on any Payment Date
(other than the Final Legal Maturity Date, any Redemption Date or as set forth
in Section 4.1(a)) in full by the next succeeding Payment Date, together with
Additional Interest on any interest not paid on the Payment Date on which it was
originally due, and (ii) in the case of any class of Notes other than the
Class A Notes, except as provided in the related Resolution or any indenture
supplemental hereto providing for the issuance of such Notes pursuant to
Section 2.15 or Section 2.16, failure to pay interest on any Notes of such class
on the Payment Date that such interest is due;

(c)(i) failure to pay principal and Premium, if any, and accrued and unpaid
interest on any Notes of such class on the applicable Final Legal Maturity Date
or (ii) subject to Section 3.10(b), failure to pay the Redemption Price when due
on any Redemption Date for such class;

 

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(d) failure to pay any other amount when due and payable in connection with such
class of Notes and the continuance of such default for a period of 30 or more
days after written notice thereof is given to the Issuer by the Trustee;

(e)(i) failure by the Issuer to comply in any material respect with any of the
covenants set forth in Section 5.2 (other than Section 5.2(k)), Section 5.3(a),
Section 5.3(b) or Section 5.3(c), and written notice thereof being given to the
Issuer by the Trustee at the Direction of Noteholders of a majority of the
Outstanding Principal Balance of the Senior Class of Notes; or (ii) failure by
the Issuer to comply in any material respect with any of the other covenants,
obligations, conditions or provisions binding on it under this Indenture or the
Notes (other than a payment default for which provision is made in
Section 4.1(a), Section 4.1(b), Section 4.1(c) or Section 4.1(d)) if (in the
case of this Section 4.1(e)(ii) only) such failure continues for a period of 30
days or more after written notice thereof has been given to the Issuer by the
Trustee at the Direction of Noteholders of a majority of the Outstanding
Principal Balance of the Senior Class of Notes;

(f) the Issuer becomes subject to a Voluntary Bankruptcy or an Involuntary
Bankruptcy;

(g) any judgment or order for the payment of money in excess of $1,000,000 shall
be rendered against the Issuer and either (i) enforcement proceedings have been
commenced by any creditor upon such judgment or order or (ii) there is any
period of ten consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect;

(h) the Issuer becomes an investment company required to be registered under the
Investment Company Act of 1940, as amended;

(i) the Issuer shall have failed to perform any of its covenants under the
Purchase and Sale Agreement where such failure (a) has a Material Adverse Effect
and (b) continues for a period of 30 days or more after written notice thereof
has been given to the Issuer by the Trustee at the Direction of Noteholders of a
majority of the Outstanding Principal Balance of the Senior Class of Notes;

(j) Indevus shall have failed to perform any of its covenants under the Pledge
and Security Agreement where such failure has a Material Adverse Effect;

(k) the Trustee shall fail to have a first-priority perfected security interest
in any of the Collateral, in any of the Issuer Pledged Equity or in any material
portion of the other Issuer Pledged Collateral; or

(l) any mandatory action by the FDA resulting in the withdrawal in the Territory
of the approval to market or sell a Product for efficacy or safety reasons where
such withdrawal would reasonably be expected to have a Material Adverse Effect.

 

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Section 4.2 Acceleration, Rescission and Annulment.

(a) If an Event of Default with respect to the Notes (other than an Acceleration
Default) occurs and is continuing, the Senior Trustee may, and, upon the
Direction of Noteholders of a majority of the Outstanding Principal Balance of
the Senior Class of Notes, shall, give an Acceleration Notice to the Issuer.
Upon delivery of such an Acceleration Notice (and so long as such Acceleration
Notice has not been rescinded and annulled pursuant to this Indenture), the
Outstanding Principal Balance of the Notes and all accrued and unpaid interest
thereon shall be immediately due and payable. At any time after the Senior
Trustee or such Noteholders have so declared the Outstanding Principal Balance
of the Notes to be immediately due and payable, and prior to the exercise of any
other remedies pursuant to this Article IV, the Senior Trustee, upon the
Direction of Noteholders of a majority of the Outstanding Principal Balance of
the Senior Class of Notes, shall, subject to Section 4.5(a), by written notice
to the Issuer, rescind and annul such declaration and thereby annul its
consequences if (i) there has been paid to or deposited with the Trustee an
amount sufficient to pay all overdue installments of interest on the Notes, and
the principal of, and Premium, if any, on the Notes that would have become due
otherwise than by such declaration of acceleration, (ii) the rescission would
not conflict with any judgment or decree and (iii) all other Defaults and Events
of Default, other than non-payment of interest on and principal and Premium, if
any, of the Notes that have become due solely because of such declaration of
acceleration, have been cured or waived. If an Acceleration Default occurs, the
Outstanding Principal Balance of the Notes and all accrued and unpaid interest
thereon shall automatically become immediately due and payable without any
further action by any party.

(b) Notwithstanding this Section 4.2, Section 4.3 and Section 4.12, after the
occurrence and during the continuation of an Event of Default, no Noteholders of
any class of Notes other than the Senior Class of Notes shall be permitted to
give or direct the giving of an Acceleration Notice, or to exercise any remedy
in respect of such Event of Default, and no Person other than the Senior
Trustee, at the Direction of Noteholders of a majority of the Outstanding
Principal Balance of the Senior Class of Notes, may give an Acceleration Notice
or exercise any such remedy.

(c) Within 30 days after the occurrence of an Event of Default in respect of any
class of Notes, the Trustee shall give to the Noteholders notice, transmitted by
mail, of all uncured or unwaived Defaults known to it on such date; provided,
that the Trustee may withhold such notice with respect to a Default (other than
a payment default with respect to interest, principal or Premium, if any) if it
determines in good faith that withholding such notice is in the interest of the
affected Noteholders.

Section 4.3 Other Remedies. Subject to the provisions of this Indenture, if an
Event of Default shall have occurred and be continuing, then the Senior Trustee
may, but only at the Direction of Noteholders of a majority of the Outstanding
Principal Balance of the Senior Class of Notes, pursue any available remedy by
proceeding at law or in equity to collect the payment of principal of, Premium,
if any, or interest on the Notes or to enforce the performance of any provision
of the Notes, this Indenture, the Servicing Agreement or the Pledge and Security
Agreement, including any of the following, to the fullest extent permitted by
law, subject to the receipt of such Direction:

(a) The Senior Trustee may obtain the appointment of a Receiver of the Indenture
Estate as provided in Section 12.7 and the Issuer consents to and waives any
right to notice of any such appointment.

 

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(b) The Senior Trustee may, without notice to the Issuer and at such time as the
Senior Trustee in its sole discretion may determine, exercise any or all of the
Issuer’s rights in, to and under or in any way connected with or related to any
or all of the Indenture Estate, including (i) demanding and enforcing payment
and performance of, and exercising any or all of the Issuer’s rights and
remedies with respect to the collection, enforcement or prosecution of, any or
all of the Indenture Estate (including the Purchased Assets and the Issuer’s
rights under the Purchase and Sale Agreement), in each case by legal proceedings
or otherwise, (ii) settling, adjusting, compromising, extending, renewing,
discharging and releasing any or all of, and any legal proceedings brought to
collect or enforce any or all of, the Purchased Assets and otherwise under the
Deal Documents and (iii) preparing, filing and signing the name of the Issuer on
(A) any proof of claim or similar document to be filed in any bankruptcy or
similar proceeding involving the Indenture Estate (including the Purchased
Assets) and (B) any notice of lien, assignment or satisfaction of lien, or
similar document in connection with the Indenture Estate (including the
Purchased Assets).

(c) The Senior Trustee may, without notice except as specified herein, sell or
cause the sale of all or any part of the Indenture Estate in one or more parcels
at public or private sale, at any of the Senior Trustee’s offices or elsewhere,
for cash, on credit or for future delivery, and upon such other terms as the
Senior Trustee may deem commercially reasonable, provided, that, so long as the
Principal Documents remain in force, the Senior Trustee shall make any such sale
only to a Person that is a Permitted Holder. The Issuer agrees that, to the
extent notice of sale shall be required by law, at least ten days’ notice to the
Issuer of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notification. The Senior
Trustee shall not be obligated to make any sale of all or any part of the
Indenture Estate regardless of notice of sale having been given. The Senior
Trustee may adjourn any public or private sale from time to time by announcement
at the time and place fixed therefor, and such sale may, without further notice,
be made at the time and place to which it was so adjourned.

(d) The Senior Trustee may, instead of exercising the power of sale conferred
upon it by Section 4.3(c) and Applicable Law, proceed by a suit or suits at law
or in equity to foreclose the Security Interest and sell all or any portion of
the Indenture Estate under a judgment or a decree of a court or courts of
competent jurisdiction, provided, that, so long as the Principal Documents
remain in force, the Senior Trustee shall make any such foreclosure sale only to
a Person that is a Permitted Holder.

(e) The Senior Trustee may require the Issuer to, and the Issuer hereby agrees
that it shall at its expense and upon request of the Senior Trustee, forthwith
assemble all or part of the Indenture Estate as directed by the Senior Trustee
and make it available to the Senior Trustee at a place to be designated by the
Senior Trustee that is reasonably convenient to both parties.

 

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(f) In addition to the rights and remedies provided for in this Indenture, the
Senior Trustee may exercise in respect of the Indenture Estate all the rights
and remedies of a secured party upon default under the UCC (whether or not the
UCC applies to the affected property included in the Indenture Estate) and under
all other Applicable Law; provided, that, so long as the Principal Documents
remain in force, the Senior Trustee shall cause any sale of the Collateral to be
made only to a Person that is a Permitted Holder.

(g) The Senior Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding.

Section 4.4 Limitation on Suits. Without limiting the provisions of Section 4.9
and the final sentence of Section 12.4, no Noteholder shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
the Pledge and Security Agreement or the Notes, for the appointment of a
receiver or trustee or for any other remedy hereunder, unless:

(a) such Noteholder is a holder of the Senior Class of Notes and has previously
given written notice to the Senior Trustee of a continuing Event of Default;

(b) the Noteholders of a majority of the Outstanding Principal Balance of the
Senior Class of Notes make a written request to the Senior Trustee to pursue a
remedy hereunder;

(c) such Noteholder or Noteholders offer to the Senior Trustee an indemnity
reasonably satisfactory to the Senior Trustee against any costs, expenses and
liabilities to be incurred in complying with such request;

(d) the Senior Trustee does not comply with such request within 60 days after
receipt of the request and the offer of indemnity; and

(e) during such 60-day period, Noteholders of a majority of the Outstanding
Principal Balance of the Senior Class of Notes do not give the Senior Trustee a
Direction inconsistent with such request.

No one or more Noteholders may use this Indenture to affect, disturb or
prejudice the rights of another Noteholder or to obtain or seek to obtain any
preference or priority not otherwise created by this Indenture and the terms of
the Notes over any other Noteholder or to enforce any right under this
Indenture, except in the manner herein provided.

Section 4.5 Waiver of Existing Defaults.

(a) The Senior Trustee, upon the Direction of Noteholders of a majority of the
Outstanding Principal Balance of the Senior Class of Notes, by written notice to
the Issuer may waive any existing Default (or Event of Default) hereunder and
its consequences, except a Default (or Event of Default) (i) in the payment of
the interest on, principal of, and Premium, if any, on any Note or (ii) in
respect of a covenant or provision hereof that under Article IX cannot be
modified or amended without the consent of the Noteholder of each Note affected
thereby. Upon any such waiver, such Default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture, but no such waiver shall extend to any subsequent or
other Default (or Event of Default) or impair any right consequent thereon.

 

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(b) Any written waiver of a Default or an Event of Default given by the Senior
Trustee to the Issuer in accordance with the terms of this Indenture shall be
binding upon the Senior Trustee and the other parties hereto. Unless such
writing expressly provides to the contrary, any waiver so granted shall extend
only to the specific event or occurrence that gave rise to the Default or Event
of Default so waived and not to any other similar event or occurrence that
occurs subsequent to the date of such waiver.

Section 4.6 Restoration of Rights and Remedies. If the Senior Trustee or any
Noteholder of the Senior Class of Notes has instituted any proceeding to enforce
any right or remedy under this Indenture, and such proceeding has been
discontinued or abandoned for any reason or has been determined adversely to the
Senior Trustee or such Noteholder, then in every such case the Issuer, the
Senior Trustee and the Noteholders shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Senior Trustee and the
Noteholders shall continue as though no such proceeding has been instituted.

Section 4.7 Remedies Cumulative. Each and every right, power and remedy herein
given to the Trustee specifically or otherwise in this Indenture shall be
cumulative and shall, to the extent permitted by law, be in addition to every
other right, power and remedy herein specifically given or now or hereafter
existing at law, in equity or by statute, and each and every right, power and
remedy whether specifically herein given or otherwise existing may be exercised
from time to time and as often and in such order as may be deemed expedient by
the Trustee, and the exercise or the beginning of the exercise of any power or
remedy shall not be construed to be a waiver of the right to exercise at the
same time or thereafter any other right, power or remedy. No delay or omission
by the Trustee in the exercise of any right, remedy or power or in the pursuance
of any remedy shall impair any such right, power or remedy or be construed to be
a waiver of any Default on the part of the Issuer or to be an acquiescence.

Section 4.8 Authority of Courts Not Required. The parties hereto agree that, to
the greatest extent permitted by law, the Trustee shall not be obliged or
required to seek or obtain the authority of, or any judgment or order of, the
courts of any jurisdiction in order to exercise any of its rights, powers and
remedies under this Indenture, and the parties hereby waive any such requirement
to the greatest extent permitted by law.

Section 4.9 Rights of Noteholders to Receive Payment. Notwithstanding any other
provision of this Indenture, the right of any Noteholder to receive payment of
interest on, principal of, or Premium, if any, on any Note on or after the
respective due dates therefor expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Noteholder.

Section 4.10 Trustee May File Proofs of Claim. The Trustee may file such proofs
of claim and other papers or documents as may be necessary or advisable in order
to have the claims of the Trustee and of any Noteholder allowed in any judicial
proceedings relating to any obligor on the Notes, its creditors or its property.

 

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Section 4.11 Undertaking for Costs. All parties to this Indenture agree, and
each Noteholder by its acceptance hereof shall be deemed to have agreed, that,
in any suit for the enforcement of any right or remedy under this Indenture or
in any suit against the Trustee for any action taken or omitted by it as
Trustee, a court in its discretion may require the filing by any party litigant
in such suit of an undertaking to pay the costs of such suit, and the court in
its discretion may assess reasonable costs, including reasonable attorneys’
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defense made by the party litigant. This
Section 4.11 does not apply to a suit instituted by the Trustee, a suit
instituted by any Noteholder for the enforcement of the payment of interest,
principal, or Premium, if any, on any Note on or after the respective due dates
expressed in such Note or a suit by a Noteholder or Noteholders of at least 10%
of the Outstanding Principal Balance of the Notes.

Section 4.12 Control by Noteholders. Subject to this Article IV and to the
rights of the Trustee hereunder, Noteholders of a majority of the Outstanding
Principal Balance of the Notes shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or exercising any trust, right or power conferred on the Trustee under any
Transaction Document; provided, that:

(a) such Direction shall not be in conflict with any rule of law or with this
Indenture and would not involve the Trustee in personal liability or expense;

(b) the Trustee shall not determine that the action so directed would be
unjustly prejudicial to the Noteholders of such class not taking part in such
Direction; and

(c) the Trustee may take any other action deemed proper by the Trustee that is
not inconsistent with such Direction.

Section 4.13 Senior Trustee. The Trustee irrevocably agrees (and the Noteholders
(other than the Noteholders represented by the Senior Trustee) shall be deemed
to agree by virtue of their purchase of the Notes) that the Senior Trustee shall
have all of the rights granted to it under this Indenture, including the right
to direct the Trustee to take certain action as provided for in this Indenture,
and the Trustee hereby agrees to act in accordance with each such authorized
direction of the Senior Trustee.

Section 4.14 Application of Proceeds. All cash proceeds received by the Senior
Trustee in respect of any sale of, collection from or other realization upon all
or any part of the Indenture Estate shall be deposited in the Collection Account
and distributed as provided in Article III. Any surplus of such cash proceeds
held and remaining after payment in full of all Secured Obligations shall be
paid over to the Issuer or whomsoever may be lawfully entitled to receive such
surplus as provided in Section 3.7. Any amount received for any sale or sales
conducted in accordance with the terms of Section 4.3 shall to the extent
permitted by Applicable Law be deemed conclusive and binding on the Issuer and
the Noteholders.

Section 4.15 Waivers of Rights Inhibiting Enforcement. The Issuer waives (a) any
claim that, as to any part of the Indenture Estate, a private or public sale,
should the Senior Trustee elect so to proceed, is, in and of itself, not a
commercially reasonable method of sale for

 

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such part of the Indenture Estate, (b) the right to assert in any action or
proceeding between it and the Senior Trustee offsets or counterclaims that it
may have, (c) except as otherwise provided in any of the Deal Documents, TO THE
EXTENT PERMITTED BY APPLICABLE LAW, NOTICE OR JUDICIAL HEARING IN CONNECTION
WITH THE TRUSTEE’S TAKING POSSESSION OR DISPOSITION OF ANY OF THE INDENTURE
ESTATE, INCLUDING ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT
REMEDY OR REMEDIES AND ANY SUCH RIGHT THAT THE ISSUER WOULD OTHERWISE HAVE UNDER
THE CONSTITUTION OR ANY STATUTE OF THE U.S. OR OF ANY STATE, AND ALL OTHER
REQUIREMENTS AS TO THE TIME, PLACE AND TERMS OF SALE OR OTHER REQUIREMENTS WITH
RESPECT TO THE ENFORCEMENT OF THE TRUSTEE’S RIGHTS HEREUNDER, (d) all rights of
redemption, appraisement, valuation, stay and extension or moratorium and
(e) except as otherwise provided in any of the Deal Documents, all other rights
the exercise of which would, directly or indirectly, prevent, delay or inhibit
the enforcement of any of the rights or remedies under this Indenture or the
absolute sale of the Indenture Estate, now or hereafter in force under any
Applicable Law, and the Issuer, for itself and all who may claim under it,
insofar as it or they now or hereafter lawfully may, hereby waives the benefit
of all such laws and rights.

Section 4.16 Security Interest Absolute. All rights of the Trustee and security
interests hereunder, and all obligations of the Issuer hereunder, shall be
absolute and unconditional irrespective of, and the Issuer hereby irrevocably
waives any defenses it may now have or may hereafter acquire in any way relating
to, any or all of the following:

(a) any lack of validity or enforceability of any of the Deal Documents or any
other agreement or instrument relating thereto (other than against the Trustee);

(b) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Secured Obligations, or any other amendment or waiver of
or any consent to any departure from the Deal Documents or any other agreement
or instrument relating thereto;

(c) any taking, exchange, surrender, release or non-perfection of any Collateral
or any other collateral, or any release or amendment or waiver of or consent to
any departure from any guaranty, for all or any of the Secured Obligations;

(d) any manner of application of any Collateral or any other collateral, or
proceeds thereof, to all or any of the Secured Obligations, or any manner of
sale or other disposition of any Collateral or any other collateral for all or
any of the Secured Obligations or any other obligations of the Issuer under or
in respect of the Deal Documents or any other assets of the Issuer;

(e) any change, restructuring or termination of the limited liability company
structure or existence of the Issuer;

(f) the failure of any other Person to execute this Indenture or any other
agreement or the release or reduction of liability of the Issuer or other
grantor or surety with respect to the Secured Obligations; or

 

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(g) any other circumstance (including any statute of limitations) or any
existence of or reliance on any representation by the Trustee that might
otherwise constitute a defense available to, or a discharge of, the Issuer.

ARTICLE V

REPRESENTATIONS, WARRANTIES AND COVENANTS

Section 5.1 Representations and Warranties. The Issuer represents and warrants,
as of the date of this Indenture, to the Trustee as follows:

(a) The Issuer is a limited liability company duly formed, validly existing and
in good standing under the laws of the State of Delaware, is duly qualified to
do business and in good standing in each jurisdiction where such qualification
is required and has full power and authority to conduct its business and to
execute, deliver and perform this Indenture, each other instrument to be
delivered by it pursuant to this Indenture and each other Deal Document to which
it is a party, and the Issuer is not in liquidation or bankruptcy and has not
become subject to a Voluntary Bankruptcy or an Involuntary Bankruptcy.

(b) The Issuer has not engaged in any activities or become subject to any Losses
or other obligations since its organization (other than those incidental to its
organization and permitted by the Issuer Organizational Documents, the execution
and performance of the Deal Documents to which it is a party and the activities
referred to in or contemplated by such agreements and, in respect of Losses or
other obligations since its organization, assuming the accuracy of the
representations and warranties of Indevus in the Purchase and Sale Agreement and
the due and timely performance by Indevus of its obligations under the Purchase
and Sale Agreement), and the Issuer has not paid any dividends or made any
similar distributions since its organization.

(c) The creation of the Notes and the issuance, execution and delivery, and the
compliance by the Issuer with the terms, of the Notes and each of the other Deal
Documents to which it is a party:

(i) do not at the Closing Date conflict with, result in a breach of any of the
terms or provisions of or constitute a default under the Issuer Organizational
Documents or, assuming the accuracy of the representations and warranties of
Indevus in the Purchase and Sale Agreement and the due and timely performance by
Indevus of its obligations under the Purchase and Sale Agreement, with any
judgment, order or decree of any Governmental Authority having jurisdiction over
the Issuer, its assets or its properties or, except where it would not have or
would not be reasonably likely to have a Material Adverse Effect, with any
Applicable Law; and

(ii) assuming the accuracy of the representations and warranties of Indevus in
the Purchase and Sale Agreement and the due and timely performance by Indevus of
its obligations under the Purchase and Sale Agreement, do not at the Closing
Date violate, or constitute a default under, any deed, indenture, agreement or
other instrument or obligation to which the Issuer is a party or by which it or
any part of its assets, property or revenues are bound.

 

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(d) The creation, execution and issuance of the Notes, the execution and
delivery by the Issuer of the Deal Documents executed by it and the performance
by the Issuer of its obligations hereunder and thereunder and the arrangements
contemplated hereby and thereby to be performed by it have been duly authorized,
executed and delivered by the Issuer.

(e) This Indenture constitutes, and the other Deal Documents to which it is a
party, when duly authorized, executed and delivered by the other party or
parties thereto, and, in the case of the Notes, when issued and authenticated,
will constitute, valid, legally binding and (subject to general equitable
principles, and laws relating to insolvency, liquidation, reorganization and
other laws of general application relating to creditors’ rights or claims or to
laws of prescription or the concepts of materiality, reasonableness, good faith
and fair dealing) enforceable obligations of the Issuer.

(f) Assuming the accuracy of the representations and warranties of Indevus in
the Purchase and Sale Agreement and the due and timely performance by Indevus of
its obligations under the Purchase and Sale Agreement, on the Closing Date,
there exists no Event of Default nor any event that, had the Notes already been
issued, would constitute a Default or an Event of Default.

(g) On the Closing Date, subject to the Liens created in favor of the Trustee
and except for any other Permitted Liens, there exists no Lien over the assets
of the Issuer.

(h) Assuming the accuracy of the representations and warranties of Indevus in
the Purchase and Sale Agreement, the due and timely performance by Indevus of
its obligations under the Purchase and Sale Agreement and the accuracy of the
statements in the certificate to be delivered by the Placement Agent pursuant to
Section 6.10 of the Note Purchase Agreements, on the Closing Date, all consents,
approvals, authorizations or other orders of all Governmental Authorities
required (excluding any required by the other parties to the Deal Documents) for
or in connection with the execution, delivery and performance of the Deal
Documents by the Issuer and the issuance and performance of the Notes and the
offering of the Notes by the Issuer have been obtained and are in full force and
effect and are not contingent upon fulfillment of any condition. No consent of
any Governmental Authority or any other party (including directors, officers,
partners, members, managers or creditors of the Issuer) is required that has not
been obtained for the pledge by the Issuer of the Collateral pursuant to this
Indenture.

(i) Assuming the accuracy of the representations and warranties of the Note
Purchasers in Section 4.2 of each Note Purchase Agreement and compliance with
Section 6.9 and after giving effect to the offering and sale of the Original
Class A Notes and the purchase by the Issuer of the Purchased Assets, the Issuer
is not required to register as an “investment company” within the meaning of the
Investment Company Act of 1940, as amended.

(j) Assuming the accuracy of the representations and warranties of Indevus in
the Purchase and Sale Agreement and the due and timely performance by Indevus of
its obligations under the Purchase and Sale Agreement, there is no action, suit,
investigation or proceeding pending or, to the knowledge of the Issuer,
threatened against the Issuer before any Governmental Authority that in any
manner challenges or seeks to prevent, enjoin, alter or materially delay the
transactions contemplated by this Indenture and the other Deal Documents to
which the Issuer is a party.

 

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(k) The Issuer has no Subsidiaries.

(l) Assuming the accuracy of the representations and warranties of Indevus in
the Purchase and Sale Agreement and the due and timely performance by Indevus of
its obligations under the Purchase and Sale Agreement, the Issuer is the sole
legal and beneficial owner of the Purchased Assets and the other assets and
properties constituting the Collateral, free and clear of any Liens other than
Permitted Liens.

(m) Under the laws of the State of Delaware, the laws of the State of New York
and U.S. federal law in force at the Closing Date, it is not necessary that this
Indenture or any other Deal Document (other than evidences and perfection of the
Liens) be filed, recorded or enrolled by the Issuer with any court or other
Governmental Authority in any such jurisdictions or that any stamp, registration
or similar Tax be paid by the Issuer on or in relation to this Indenture or any
of the other Deal Documents (other than filings of Uniform Commercial Code
financing statements set forth in Exhibit E and the various consents and
agreements, if any, pursuant hereto).

(n) The filings of financing statements under the UCC and other recordings, if
any, in the appropriate offices therefor and any other actions required to
perfect a security interest in favor of the Trustee in the Collateral, including
the Purchased Assets sold, transferred, conveyed, assigned, contributed and
granted on the Closing Date pursuant to the Purchase and Sale Agreement, have
been or shall have been duly made by the Closing Date, and, subject to the terms
and provisions of this Indenture, the Issuer has or shall have the same rights
as Indevus has or would have with respect to the Purchased Assets (if Indevus
were still the owner of such Purchased Assets) against Counterparty. No other
security agreement, financing statement or other public notice with respect to
all or any part of the Collateral (other than any of the foregoing that is
referenced in Exhibit E to this Indenture or otherwise names the Trustee as
secured party) is on file or of record in any public office that perfects a
valid security interest therein. This Indenture creates a valid security
interest in the Collateral securing the payment of the Secured Obligations.

(o) Assuming the accuracy of the representations and warranties of Indevus in
the Purchase and Sale Agreement and the due and timely performance by Indevus of
its obligations under the Purchase and Sale Agreement, the Issuer has
determined, and by virtue of its entering into the transactions contemplated
hereby and its authorization, execution and delivery of this Indenture and the
other Deal Documents to which it is party, that its incurrence of Indebtedness
and any other liability hereunder or thereunder or contemplated hereby or
thereby, (i) is in its own best interests, (ii) does not leave it unable to pay
its debts as they become due in the ordinary course of business, (iii) will not
leave it with debts that cannot be paid from the present saleable value of its
property and (iv) will not render it insolvent within the meaning of
Section 101(32) of the Bankruptcy Code or Section 271 of the New York Debtor and
Creditor Law or leave it with unreasonably small capital.

 

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(p) Assuming the accuracy of the representations and warranties of Indevus in
the Purchase and Sale Agreement and the due and timely performance by Indevus of
its obligations under the Purchase and Sale Agreement, no material adverse
change in the business, condition (financial or otherwise), operations,
performance, properties or prospects of the Issuer has occurred since its date
of formation.

(q) The Issuer is an entity that is disregarded as separate from the
Equityholder for U.S. federal income tax purposes. The Issuer has never filed
any tax return or report under any name other than its exact legal name. The
Issuer has filed (or caused to be filed) all tax returns and reports required by
law to have been filed by it and has paid all Taxes required to be paid by it.

(r) No step has been taken or is intended by the Issuer or, so far as it is
aware, any other Person for the winding-up, liquidation, dissolution,
administration, merger or consolidation or for the appointment of a receiver or
administrator of the Issuer or all or any of its assets.

(s) The Issuer has not assigned or pledged any of its right, title or interest
in the Collateral to anyone other than the Trustee.

(t) Assuming the accuracy of the representations and warranties of Indevus in
the Purchase and Sale Agreement and the due and timely performance by Indevus of
its obligations under the Purchase and Sale Agreement, the Issuer is in
compliance with the requirements of all Applicable Laws, a breach of any of
which, individually or in the aggregate, would be reasonably likely to have a
Material Adverse Effect.

(u) The Issuer is not engaged in the business of extending credit for the
purpose of buying or carrying margin stock, and no portion of the Note Purchase
Price shall be used (i) for a purpose that violates, or would be inconsistent
with, Regulation T, U or X promulgated by the Board of Governors of the Federal
Reserve System from time to time or (ii) to acquire any security in any
transaction that is subject to Section 13 or 14 of the Exchange Act.

(v) The representations and warranties made by the Issuer to the Noteholders in
any of the other Transaction Documents to which it is a party are true and
accurate as of the date made.

Section 5.2 Covenants. The Issuer covenants with the Trustee that, so long as
any Notes are Outstanding, it will perform and comply with each of the following
covenants and not engage in any activity prohibited by this Indenture without
the prior written consent of the Trustee pursuant to Section 9.1 or Section 9.2,
as applicable, authorizing the Issuer not to perform any such covenants or to
engage in any such activity prohibited by this Indenture, in each case on such
terms and conditions, if any, as shall be specified in such prior written
consent:

(a) Except as expressly permitted by this Indenture, the Issuer shall not take
any action, whether orally or in writing, that would amend, waive, modify,
supplement, restate, cancel or terminate, or discharge or prejudice the validity
or effectiveness of, this Indenture, the Notes, the Pledge and Security
Agreement or the Note Purchase Agreement, or permit any party to any such
document to be released from its obligations thereunder.

 

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(b) The Issuer shall not, directly or indirectly, (i) declare or pay any
dividend or make any distribution on its Capital Securities, whether in cash,
property, securities or a combination thereof, to the Equityholders or any other
record or beneficial owner of any Capital Securities of the Issuer or otherwise
with respect to any ownership of the Issuer’s Capital Securities, except that
the Issuer may distribute to the Equityholders (x) any Tax Distribution pursuant
to Section 3.7(a)(iii) or any amounts pursuant to Section 3.11, (y) pursuant to
Section 3.7(b), all or any portion of any amounts transferred to the Issuer
pursuant to Section 3.7(a)(viii) or (z) any proceeds from an issuance of Notes
or Capital Securities in accordance with this Indenture, (ii) purchase, redeem,
retire or otherwise acquire for value any issued Capital Securities of the
Issuer or any of its Subsidiaries, (iii) make any payment of principal, interest
or Premium, if any, on the Notes or make any voluntary or optional redemption,
repurchase, defeasance or other acquisition or retirement for value of, or make
any deposit (including the payment of amounts into a sinking fund or other
similar fund) with respect to, Indebtedness of the Issuer other than as
expressly permitted by the Notes and this Indenture (including in connection
with any issuance or sale of any Class B Notes or Capital Securities expressly
permitted by the Notes and this Indenture) or (iv) make any loan or advance to
any Person, any purchase or other acquisition of any beneficial interest,
Capital Securities, warrants, rights, options, obligations or other securities
of such Person, any capital contribution to such Person or any other investment
in such Person (other than Eligible Investments and investments permitted under
Section 5.2(f) or otherwise as expressly permitted by the Notes and this
Indenture).

(c) The Issuer shall not (and shall not consent to the Equityholders taking any
action that would) incur or suffer to exist any Lien over or with respect to any
of the Issuer’s assets, including the Collateral, other than any Permitted Lien
(including any security interest created or required to be created hereunder,
including in connection with the issuance of any Class B Notes and any
Refinancing Notes).

(d) The Issuer shall not incur, create, issue, assume, Guarantee or otherwise
become liable for or with respect to, or become responsible for, the payment or
performance of, contingently or otherwise, whether present or future (in any
such case, to “Incur”), Indebtedness; provided, however, that the Issuer may
Incur Indebtedness in respect of the Original Class A Notes, any Class B Notes
and any Refinancing Notes issued in accordance with this Indenture.

(e) Except with respect to the disposition of cash and Eligible Investments in
connection with the investment and reinvestment thereof, the Issuer shall not
liquidate or dissolve, consolidate with, merge with or into, or sell, convey,
transfer, lease or otherwise dispose of the Purchased Assets or all or any
material portion of its other property and assets to, or purchase or otherwise
acquire all or substantially all of the assets of, any other Person, or permit
any other Person to merge with or into, or consolidate or otherwise combine
with, the Issuer; provided, that, notwithstanding anything in this Indenture to
the contrary, the Issuer shall not acquire or dispose of assets for the primary
purpose of recognizing gains or decreasing losses resulting from market value
changes.

 

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(f) The Issuer shall not, directly or indirectly, issue, deliver or sell, or
consent to issue, deliver or sell, any Capital Securities of the Issuer unless
such additional Capital Securities are pledged to the Trustee pursuant to the
Pledge and Security Agreement; provided, that the Issuer shall not accept any
capital contributions from the Equityholders after the Closing Date except for
capital contributions deposited into the Capital Account, which may be used only
as provided in Section 3.1(f); provided, further, that any such Equityholder is
not subject to U.S. federal withholding tax in respect of the Royalties.

(g) The Issuer shall not engage in any business or activity other than
purchasing, holding, servicing and pledging the Purchased Assets, collecting the
Royalties, issuing Notes, issuing Capital Securities (subject to the provisions
of Section 5.2(f)), undertaking any action contemplated by the Purchase and Sale
Agreement or necessary or reasonably appropriate to maintain, enforce or enjoy
the full benefit of any current or residual rights granted by or arising out of
the Purchase and Sale Agreement, including enforcement of the Indevus
Intellectual Property and negotiation and implementation of a New Arrangement
(as provided in Section 5.2(y)), and entering into, remaining a party to, and
otherwise performing any of the transactions contemplated by, and exercising any
right or remedy granted to the Issuer pursuant to or arising out of, the Deal
Documents and other matters reasonably related thereto.

(h) The Issuer shall not, directly or indirectly, enter into, renew or extend
any transaction (including the purchase, sale, lease or exchange of property or
assets, or the rendering of any service) with any Affiliate of the Issuer,
except for the Deal Documents as in effect on the Closing Date and the Issuer
Organizational Documents.

(i) The Issuer shall not take any action to become subject to a Voluntary
Bankruptcy or an Involuntary Bankruptcy. The Issuer shall provide promptly the
Trustee with written notice of the institution of any proceeding by or against
the Issuer seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding-up, reorganization, arrangement, adjustment, protection,
relief or composition of its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee or other similar
official for it or for any substantial part of its property. The Issuer shall
not, without an affirmative written resolution adopted by all of the Members,
take any action to waive, repeal, amend, vary, supplement or otherwise modify
any provision of any of the Issuer Organizational Documents that requires
unanimous written consent of the Members. The Issuer shall comply with, and
cause compliance with, the Issuer Organizational Documents.

(j) The Issuer shall not take any action to waive, repeal, amend, vary,
supplement or otherwise modify the Issuer Organizational Documents in a manner
that would materially adversely affect (x) the rights, remedies, privileges or
preferences of the Noteholders or (y) the validity, perfection or priority of
the Lien on any Collateral (including the Purchased Assets) or any Issuer
Pledged Collateral.

(k) The Issuer shall duly and punctually pay principal with respect to the
Outstanding Principal Balance, Premium, if any, and Interest Amount on the Notes
in accordance with the terms of this Indenture and such Notes; provided, that
the Issuer shall be in compliance with this covenant with respect to any Payment
Date (other than the Final Legal Maturity Date or

 

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any Redemption Date subject to Section 3.10(b)) if any such interest in excess
of the portion of the Available Collections Amount available to pay such
interest on the relevant Payment Date and funds in the Interest Reserve Account
and the Capital Account are paid in full not later than the immediately
succeeding Payment Date (together with Additional Interest thereon).

(l) The Issuer shall not employ any employees other than as required by any
provisions of local law; provided, that the Members, the Manager and the Service
Providers shall not be deemed to be employees for purposes of this
Section 5.2(l).

(m) The Issuer shall not (w) assign, amend, waive, modify, supplement, restate,
cancel or terminate (or consent to any cancellation or termination of) the
Purchase and Sale Agreement or any Principal Document, (x) breach any of the
provisions of the Purchase and Sale Agreement or any Principal Document,
(y) enter into any new agreement in respect of the Purchased Assets or the
Products (in respect of the Territory in the Field) (other than any New
Arrangement as provided in Section 5.2(y)) or (z) waive any obligation of, or,
except pursuant to Section 5.2(b) of the Purchase and Sale Agreement and the
last sentence of Section 7.3 of the Purchase and Sale Agreement, grant any
consent to, Indevus under or in respect of the Purchased Assets, the Purchase
and Sale Agreement, the Products (in respect of the Territory in the Field) or
any Principal Document.

(n) The Issuer shall at all times use its commercially reasonable efforts to
exercise and enforce its rights and remedies under the Purchase and Sale
Agreement, the Servicing Agreement and the Principal Documents in a timely and
commercially reasonable manner; provided, that, following the occurrence and
continuation of an Event of Default, the Issuer shall give notice to the Trustee
on behalf of the Noteholders of any contemplated enforcement of such rights and
remedies and will follow any Direction of Noteholders of a majority of the
Outstanding Principal Balance of the Senior Class of Notes that it has received.

(o) The Issuer shall maintain its existence separate and distinct from any other
Person in all material respects, including using its commercially reasonable
efforts in taking the following actions, as appropriate:

(i) maintaining in full effect its existence, properties, rights and franchises
as a Delaware limited liability company and obtaining and preserving its
qualification to do business in each jurisdiction in which such qualification is
or will be necessary to protect the validity and enforceability of this
Indenture and each other instrument or agreement necessary or appropriate to
properly administer this Indenture and permit and effectuate the transactions
contemplated hereby and thereby;

(ii) maintaining its own deposit accounts, separate from those of the
Equityholders, the Manager, any of its directors or officers and their
respective Affiliates;

(iii) conducting its affairs separately from those of the Equityholders, the
Manager, any of its directors or officers or any of their respective Affiliates
and maintaining accurate and separate books, records and accounts and financial
statements in accordance with GAAP, including in connection with the purchase of
the Purchased Assets from Indevus; it being agreed that performance under the
Deal Documents will not result in the Issuer’s contravening this
Section 5.2(o)(iii);

 

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(iv) acting solely in its own name and not that of any other Person, including
the Equityholders, the Manager, any of its directors or officers or any of their
respective Affiliates, and at all times using its own stationery, invoices and
checks separate from those of the Equityholders, the Manager, any of its
directors or officers or any of their respective Affiliates;

(v) not holding itself out as having agreed to pay or guarantee, or as otherwise
being liable for, the obligations of the Equityholders, the Manager, any of its
directors or officers or any of their respective Affiliates;

(vi) insuring that any financial reports prepared by the Issuer disclose the
effects of the sale of the Purchased Assets from Indevus and any of its
Affiliates in compliance with GAAP;

(vii) maintaining all of its assets in its own name and not commingling its
assets with those of any other Person except as required under the Deal
Documents;

(viii) paying its own operating expenses and other liabilities out of its own
funds;

(ix) observing all formalities required by the Issuer Organizational Documents;

(x) not acquiring obligations of the Equityholders, the Manager, any director or
officer of the Issuer or any of their respective Affiliates except as required
under the Deal Documents;

(xi) holding itself out to the public as a legal entity separate and distinct
from any other Person, including the Equityholders or any Affiliate of any
Equityholder;

(xii) correcting any known misunderstanding regarding its separate identity;

(xiii) not forming, acquiring or holding any Subsidiary;

(xiv) not sharing any common logo with or identifying itself as a department or
division of Indevus, the Equityholders, the Manager or any of their respective
Affiliates; provided, however, that the Issuer may identify itself as an
investment of and owned and/or managed by any such Equityholders or any of their
respective Affiliates;

(xv) except as permitted by Section 5.2(g), conducting no material transactions
between the Issuer and Indevus, other than entering into and performing the Deal
Documents to which it is party (including any New Arrangement as provided in
Section 5.2(y)); and

 

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(xvi) allocating fairly and reasonably the cost of any shared overhead expenses,
including office space, if applicable, with the Equityholders, the Manager, any
of its directors or officers or any of their respective Affiliates.

(p) The Issuer will not enter into any agreement prohibiting the right of the
Trustee or any Noteholder to amend or otherwise modify any Deal Document;
provided, that the foregoing prohibition shall not apply to restrictions
contained in any Deal Document.

(q) The Issuer will not change, amend or alter its exact legal name at any time
except following 30 days’ notice given by the Issuer to the Trustee. The Issuer
shall not change its accounting policies or reporting practices except as
permitted by the Issuer Organizational Documents.

(r) The Issuer will not assign or pledge, so long as the assignment hereunder
shall remain in effect and has not been terminated pursuant to Section 11.1, any
of its right, title or interest in the Collateral hereby assigned to anyone
other than the Trustee; provided, that the sale or other disposition of the
Capital Securities of the Issuer by any Equityholder (or any interest therein)
in compliance with the Pledge and Security Agreement or any issuance of Capital
Securities by the Issuer (subject to the provisions of Section 5.2(f)) shall not
be considered a violation of this Section 5.2(r).

(s) The Issuer agrees that, at any time and from time to time, at the Issuer’s
expense and upon the Trustee’s reasonable written request, the Issuer will
promptly and duly execute and deliver or cause to be duly executed and delivered
any and all such further instruments and documents, and take all further action,
that may be necessary in the reasonable discretion of the Trustee, in order to
perfect the security interest in the Collateral and to carry out the provisions
of this Indenture or to enable the Trustee to exercise and enforce its rights
and remedies hereunder with respect to any Collateral. The Issuer also agrees
that, at any time and from time to time, at the Issuer’s expense, the Issuer
will file (or cause to be filed) such UCC continuation statements and such other
instruments or notices as may be necessary, including UCC financing statements
or amendments thereto, that the Trustee may reasonably request in order to
perfect and preserve the security interests and other rights granted or
purported to be granted to the Trustee hereby. With respect to the foregoing and
the grant of the security interest hereunder, the Issuer hereby authorizes the
Trustee to file one or more financing or continuation statements, and amendments
thereto, relative to all or any part of the Collateral. The Issuer hereby
authorizes the Trustee to file financing statements describing as the collateral
covered thereby “all of the debtor’s personal property or assets” or words to
that effect, notwithstanding that such wording may be broader in scope than the
Collateral described in this Indenture.

(t) The Issuer will maintain in the Borough of Manhattan, The City of New York,
an office or agency of the Trustee, Registrar and Paying Agent where Notes may
be presented or surrendered for payment, where Notes may be surrendered for
registration of transfer, exchange or purchase and where notices and demands to
or upon the Issuer in respect of the Notes and this Indenture may be served.
Each of the Corporate Trust Office and each office or agency of the Trustee in
the Borough of Manhattan, The City of New York shall initially be one such
office or agency for all of the aforesaid purposes. The Issuer shall give prompt
written notice to the Trustee of the location, and of any change in the
location, of any such office or

 

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agency (other than a change in the location of the office of the Trustee). If at
any time the Issuer shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 12.5. The Issuer may also from time to time
designate one or more other offices or agencies where the Notes may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Issuer of its obligation to maintain an office
or agency in the Borough of Manhattan, The City of New York, for such purposes.

(u) The Issuer shall maintain its status as a “pass-through” entity (i.e.,
either (i) an entity that is disregarded as separate from the Equityholder if
there is one Equityholder for U.S. federal income tax purposes or (ii) a
partnership if there is more than one Equityholder for U.S. federal income tax
purposes, in each case for U.S. federal income tax purposes and, to the extent
permitted by Applicable Law, state and local tax purposes). The Issuer shall not
file any tax return or report under any name other than its exact legal name.
The Issuer shall treat the Notes as debt for U.S. federal income tax purposes.
Neither the Issuer nor the Trustee shall treat any Noteholder or Beneficial
Holder as a “partner” of the Issuer for U.S. federal income tax purposes with
respect to the ownership of the Notes. The Issuer and the Trustee will treat all
interest paid or otherwise accruing on the Notes as interest for U.S. federal
income tax purposes. The Issuer will prepare and file all tax returns of the
Issuer consistent with the covenants set forth in this Section 5.2(u) and will
not take any inconsistent position in any communication or agreement with any
taxing authority unless required by a final “determination” of a court of law
within the meaning of Section 1313(a)(1) of the Code. The Issuer shall file (or
cause to be filed) all tax returns and reports required by law to be filed by it
and pay all Taxes required to be paid by it.

(v) The Issuer shall comply with all Applicable Laws with respect to the Deal
Documents, the Principal Documents, the Purchased Assets and all ancillary
agreements related thereto, the violation of which would be, alone or in the
aggregate, reasonably likely to have a Material Adverse Effect.

(w) The Issuer shall (i) preserve and maintain its existence, (ii) preserve and
maintain its rights, franchises, permits, licenses, approvals and privileges and
(iii) qualify and remain qualified in good standing in each jurisdiction, in
each case where the failure to preserve and maintain such existence, rights,
franchises, permits, licenses, approvals, privileges and qualifications would
be, alone or in the aggregate, reasonably likely to have a Material Adverse
Effect. The Issuer shall appoint and employ such agents or attorneys in each
jurisdiction where it shall be necessary to take any action under this
Indenture.

(x) The Issuer shall timely and fully perform and comply with each of its duties
and obligations to the Noteholders under the Transaction Documents to which it
is a party, including all covenants, conditions and other provisions with
respect to the Purchased Assets.

(y) In the event that the License Agreement terminates, the Issuer shall use its
commercially reasonable efforts to identify and negotiate a New Arrangement that
is commercially reasonable with respect to the Issuer, the Issuer’s rights under
the Purchase and Sale Agreement and the Principal Documents and the rights of
the Trustee and the Noteholders under the Deal Documents.

 

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(z) During any period in which the Issuer is not subject to Section 13 or 15(d)
of the Exchange Act, the Issuer shall make available to any Noteholder or
Beneficial Holder in connection with any sale of any or all of its Notes and any
prospective purchaser of such Notes from such Noteholder or Beneficial Holder
the information required by Rule 144A(d)(4) under the Securities Act.

(aa) The Issuer shall not, and shall not permit any of its Affiliates to,
directly or indirectly, pay or cause to be paid any consideration of any type or
form (whether in cash, property, by way of interest or fee or otherwise) to or
for the benefit of any Noteholder or Beneficial Holder for or as an inducement
to any forbearance, consent, waiver or amendment of any of the terms or
provisions hereof or of the Notes, or any agreement in respect thereof, unless
such consideration is, on the same terms and conditions, offered to all
Noteholders and Beneficial Holders and paid to all Noteholders and Beneficial
Holders that agree to such forebearance, consent, waiver or amendment, or
agreement in respect thereof.

Section 5.3 Reports and Other Deliverables by the Issuer.

(a) The Issuer shall furnish to the Trustee, within 120 days after the end of
each fiscal year commencing with the fiscal year ending September 30, 2008, a
certificate from a Responsible Officer of the Issuer as to his or her knowledge
of the Issuer’s compliance with all of its obligations under this Indenture (it
being understood that, for purposes of this Section 5.3, such compliance shall
be determined without regard to any period of grace or requirement of notice
provided under this Indenture but shall reflect any Interest Amount paid on the
Original Class A Notes by the next succeeding Payment Date as contemplated by
the proviso to Section 5.2(k) as have been timely paid).

(b) The Issuer shall deliver written notice to the Trustee of the occurrence of
any Default or Event of Default under this Indenture promptly and in any event
within five Business Days of a Responsible Officer of the Issuer becoming aware
of such Default or Event of Default.

(c) The Issuer shall promptly (and in any event within five Business Days of
receipt thereof) provide to the Trustee and any Servicer copies of all materials
that the Issuer receives from Indevus pursuant to the Purchase and Sale
Agreement or otherwise in respect of the Principal Documents.

(d) Within 120 days after the beginning of each fiscal year commencing with the
fiscal year beginning October 1, 2008, the Issuer shall furnish to the Trustee
an opinion of its legal counsel, which opinion shall state whether there are any
actions to be taken, including any financing statements to be filed in any
office, within the period of 12 full consecutive calendar months following the
date of such opinion in order to continue the perfection of the security
interests granted under the Deal Documents or to continue the effectiveness of
any financing statements filed in connection with the Principal Documents as of
the date hereof.

 

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ARTICLE VI

THE TRUSTEE

Section 6.1 Acceptance of Trusts and Duties. Except during the continuance of an
Event of Default, the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied covenants
or obligations shall be read into this Indenture against the Trustee; provided,
that, to the extent those duties are qualified, limited or otherwise affected by
the provisions of any other Deal Document, the Trustee shall be required to
perform those duties only as so qualified, limited or otherwise affected. The
duties and responsibilities of the Trustee shall be as provided by the Trust
Indenture Act (as if the Trust Indenture Act applied to this Indenture) and as
set forth herein. The Trustee accepts the trusts hereby created and applicable
to it and agrees to perform the same but only upon the terms of this Indenture
and the Trust Indenture Act (as if the Trust Indenture Act applied to this
Indenture) and agrees to receive and disburse all moneys received by it in
accordance with the terms hereof. The Trustee in its individual capacity shall
not be answerable or accountable under any circumstances except for its own
willful misconduct or negligence or breach of any of its representations or
warranties set forth herein, and the Trustee shall not be liable for any action
or inaction of the Issuer or any other parties to any of the Deal Documents. Any
amounts received by or due to the Trustee under this Indenture, including the
fees, out-of-pocket expenses and indemnities of the Trustee, shall be Expenses
of the Issuer.

The Issuer does hereby constitute and appoint the Trustee the true and lawful
attorney of the Issuer, irrevocably, granted for good and valuable consideration
and coupled with an interest and with full power of substitution, and with full
power (in the name of the Issuer or otherwise), to ask, require, demand,
receive, compound and give acquittance for any and all monies and claims for
monies (in each case including insurance and requisition proceeds) due and to
become due under or arising out of any Deal Document and all other property that
now or hereafter constitutes part of the Indenture Estate, to endorse any checks
or other instruments or orders in connection therewith and to file any claims or
take any action or institute any proceedings that the Trustee may deem to be
necessary or advisable in the premises; provided, that the Trustee shall not
exercise any such rights except upon the occurrence and during the continuance
of an Event of Default hereunder in accordance with Section 4.3.

Section 6.2 Copies of Documents and Other Notices.

(a) The Trustee, upon written request, shall furnish to each requesting
Noteholder or Beneficial Holder included on the Approved Holder List and any
Servicer, promptly upon receipt thereof, duplicates or copies of all reports,
Notices, requests, demands, certificates, financial statements and other
instruments furnished to the Trustee under or in connection with this Indenture.

(b) The Trustee shall furnish to Noteholders and Beneficial Holders included on
the Approved Holder List and any Servicer promptly after receipt thereof any
reports or notices received from any of the Issuer, the Equityholders, Indevus,
Counterparty, Supernus or Madaus, including the report of any audit contemplated
by Section 5.7 of the Purchase and Sale Agreement.

 

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Section 6.3 Representations and Warranties. The Trustee does not make and shall
not be deemed to have made any representation or warranty as to the validity,
legality or enforceability of this Indenture, the Notes or any other document or
instrument or as to the correctness of any statement contained in any thereof,
except that the Trustee in its individual capacity hereby represents and
warrants as follows:

(a) The Trustee is a national banking association and is validly existing and in
good standing under the laws of the United States, and is duly authorized and
licensed under applicable law to conduct its business as presently conducted.

(b) The Trustee has all requisite right, power and authority to execute and
deliver this Indenture and its related documents and to perform all of its
duties as Trustee hereunder and thereunder.

(c) The execution and delivery by the Trustee of this Indenture and the other
Deal Documents to which it is a party, and the performance by the Trustee of its
duties hereunder and thereunder, have been duly authorized by all necessary
corporate proceedings, and no further approvals or filings, including any
governmental approvals, are required for the valid execution and delivery by the
Trustee, or the performance by the Trustee, of this Indenture and such other
Deal Documents to which it is a party.

(d) The execution, delivery and performance by the Trustee of this Indenture and
the other Deal Documents to which it is a party (i) to the best of the Trustee’s
knowledge and without independent inquiry or investigation into the facts
thereto, do not violate any provision of any Applicable Law and (ii) do not
violate any provision of its corporate charter or by-laws.

(e) The execution, delivery and performance by the Trustee of this Indenture and
the other Deal Documents to which it is a party, to the best of the Trustee’s
knowledge and without independent inquiry or investigation into the facts
thereto, do not require the authorization, consent or approval of, the giving of
notice to, the filing or registration with, or the taking of any action in
respect of, any Governmental Authority.

(f) The Trustee has duly executed and delivered this Indenture and each other
Deal Document to which it is a party, and each of this Indenture and each such
other Deal Document constitutes the legal, valid and binding obligation of the
Trustee in accordance with its terms, except as (i) such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium and similar laws
relating to or affecting the enforcement of creditors’ rights generally and
(ii) the availability of equitable remedies may be limited by equitable
principles of general applicability.

(g) The Trustee meets the requirements of Section 6.9.

Section 6.4 Reliance; Agents; Advice of Counsel. The Trustee shall incur no
liability to anyone acting upon any signature, instrument, notice, resolution,
request, consent, order, certificate, report, opinion, bond or other document or
paper believed by it to be genuine and believed by it to be signed by the proper
party or parties. The Trustee may accept a copy of a resolution of the governing
body of any party to any Deal Document (including the Issuer), certified in an
accompanying Officer’s Certificate as duly adopted and in full force and effect,
as

 

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conclusive evidence that such resolution has been duly adopted and that the same
is in full force and effect. As to any fact or matter the manner of
ascertainment of which is not specifically described herein, the Trustee shall
be entitled to receive and may for all purposes hereof conclusively rely on a
certificate, signed by an officer of any duly authorized Person, as to such fact
or matter, and such certificate shall constitute full protection to the Trustee
for any action taken or omitted to be taken by it in good faith in reliance
thereon. To the extent not otherwise specifically provided herein, the Trustee
shall assume, and shall be fully protected in assuming, that the Issuer is
authorized by its constitutional documents to enter into this Indenture and to
take all action permitted to be taken by it pursuant to the provisions hereof
and shall not be required to inquire into the authorization of the Issuer with
respect thereto. To the extent not otherwise specifically provided herein, the
Trustee shall furnish to the Issuer or any Servicer upon written request such
information and copies of such documents as the Trustee may have and as are
necessary for the Issuer or any such Servicer to perform its duties under
Article II and Article III or otherwise.

The Trustee shall not be liable for any action it takes or omits to take in good
faith that it believes to be authorized or within its rights or powers or for
any action it takes or omits to take in accordance with the Direction of the
Noteholders in accordance with Section 4.12 relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust, right or power conferred upon the Trustee, under any
Transaction Document.

The Trustee may execute any of the trusts or powers hereunder or perform any
duties hereunder or under any other Transaction Document either directly or by
or through agents or attorneys or a custodian or nominee, and the Trustee shall
not be responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.

The Trustee may consult with counsel as to any matter relating to this Indenture
or any other Transaction Document and any Opinion of Counsel or any advice of
such counsel shall be full and complete authorization and protection in respect
of any action taken or suffered or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel.

The Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Indenture or any other Transaction Document, or to
institute, conduct or defend any litigation hereunder or in relation hereto, at
the request, order or Direction of any of the Noteholders, pursuant to the
provisions of this Indenture or any other Transaction Document, unless such
Noteholders shall have offered to the Trustee security or indemnity reasonably
satisfactory to it against the costs, expenses and liabilities that may be
incurred therein or thereby.

The Trustee shall not be required to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder
or under any other Transaction Document, or in the exercise of any of its rights
or powers, if there is reasonable ground for believing that the repayment of
such funds or indemnity satisfactory to it against such risk or liability is not
reasonably assured to it, and none of the provisions contained in this Indenture
or any other Transaction Document shall in any event require the Trustee to
perform, or be responsible or liable for the manner of performance of, any
obligations of the Issuer or any Servicer under this Indenture or any of the
other Transaction Documents.

 

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The Trustee shall not be liable for any Losses or Taxes (except for Taxes
relating to any compensation, fees or commissions of any entity acting in its
capacity as Trustee hereunder) or in connection with the selection of Eligible
Investments or for any investment losses resulting from Eligible Investments.

When the Trustee incurs expenses or renders services in connection with an
Acceleration Default, such expenses (including the fees and expenses of its
counsel) and the compensation for such services are intended to constitute
expenses of administration under any bankruptcy law or law relating to
creditors’ rights generally.

The Trustee shall not be charged with knowledge of an Event of Default unless a
Responsible Officer of the Trustee obtains actual knowledge of such event or has
received written notice of such event at its Corporate Trust Office from the
Issuer, any Servicer or Noteholders of not less than 10% of the Outstanding
Principal Balance of the Notes.

The Trustee shall have no duty to monitor the performance of the Issuer, any
Servicer or any other party to the Deal Documents, nor shall it have any
liability in connection with the malfeasance or nonfeasance by such parties.

Whenever in the administration of the provisions of this Indenture the Trustee
shall deem it necessary or desirable that a matter be proved or established
prior to taking or suffering any action to be taken hereunder or under any other
Transaction Document, such matter (unless other evidence in respect thereof be
herein specifically prescribed) may, in the absence of gross negligence or bad
faith on the part of the Trustee, be deemed to be conclusively proved and
established by a certificate signed by a Responsible Officer of the Issuer and
delivered to the Trustee, and such certificate, in the absence of gross
negligence or bad faith on the part of the Trustee, shall be full warrant to the
Trustee for any action taken, suffered or omitted by it under the provisions of
this Indenture or any other Transaction Document upon the faith thereof.

Except as provided expressly hereunder, the Trustee shall have no obligation to
invest and reinvest any cash held in the Accounts in the absence of timely and
specific written investment direction by or on behalf of the Issuer. In no event
shall the Trustee be liable for the selection of investments or for investment
losses incurred thereon. The Trustee shall have no liability in respect of
losses incurred as a result of the liquidation of any investment prior to its
stated maturity or the failure of the Issuer to provide timely written
investment direction.

When the Trustee incurs expenses after the occurrence of a Default specified in
Section 4.1 with respect to the Issuer, if the surviving entity has failed to
honor such obligation, the expenses are intended to constitute expenses of
administration under any insolvency law or under the Bankruptcy Code.

Section 6.5 Not Acting in Individual Capacity. The Trustee acts hereunder solely
as trustee unless otherwise expressly provided, and all Persons, other than the
Noteholders to the extent expressly provided in this Indenture, having any claim
against the Trustee by reason of the transactions contemplated hereby shall
look, subject to the lien and priorities of payment as provided herein or in any
other Transaction Document, only to the property of the Issuer for payment or
satisfaction thereof.

 

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Section 6.6 Compensation of Trustee. The Trustee agrees that it shall have no
right against the Noteholders or, except as provided in Section 3.7(a), the
property of the Issuer, for any fee as compensation for its services hereunder.
The Issuer shall pay to the Trustee from time to time such compensation as is
agreed between the two parties. The compensation shall be paid to the Trustee as
provided in Section 3.7(a).

Section 6.7 Notice of Defaults. As promptly as practicable after, and in any
event within 30 days after, the occurrence of any Default hereunder, the Trustee
shall transmit by mail to the Issuer, any Servicer and the Noteholders of the
related class, in accordance with Section 313(c) of the Trust Indenture Act (as
if the Trust Indenture Act applied to this Indenture), notice of such Default
hereunder actually known to a Responsible Officer of the Trustee, unless such
Default shall have been cured or waived; provided, however, that, except in the
case of a Default on the payment of the interest, principal or Premium, if any,
on any Note, the Trustee shall be fully protected in withholding such notice if
and so long as a trust committee of Responsible Officers of the Trustee in good
faith determines that the withholding of such notice is in the interests of the
Noteholders of the related class.

Section 6.8 May Hold Notes. The Trustee, any Paying Agent, the Registrar or any
of their Affiliates or any other agent in their respective individual or any
other capacity may become the owner or pledgee of the Notes and, subject to
Sections 310(b) and 311 of the Trust Indenture Act (as if the Trust Indenture
Act applied to this Indenture), may otherwise deal with the Issuer with the same
rights it would have if it were not the Trustee, Paying Agent, Registrar or such
other agent.

Section 6.9 Corporate Trustee Required; Eligibility. There shall at all times be
a Trustee that shall (a) be eligible to act as a trustee under Section 310(a) of
the Trust Indenture Act (as if the Trust Indenture Act applied to this
Indenture), (b) meet the requirements of Rule 3a-7(a)(4)(i) under the Investment
Company Act of 1940, as amended, and (c) meet the Eligibility Requirements. If
such corporation publishes reports of conditions at least annually, pursuant to
law or to the requirements of any federal, state, foreign, territorial or
District of Columbia supervising or examining authority, then, for the purposes
of this Section 6.9, the combined capital and surplus of such corporation shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of conditions so published.

In case at any time the Trustee shall cease to be eligible in accordance with
the provisions of this Section 6.9 to act as Trustee, the Trustee shall resign
immediately as Trustee in the manner and with the effect specified in
Section 7.1.

Section 6.10 Reports by the Trustee. Within 60 days after May 15 of each year
commencing with the first full calendar year following the issuance of any class
of Notes, the Trustee shall, if required by Section 313(a) of the Trust
Indenture Act (as if the Trust Indenture Act applied to this Indenture),
transmit to the Noteholders of each class, as provided in Section 313(c) of the
Trust Indenture Act (as if the Trust Indenture Act applied to this Indenture), a
brief report describing, among other things, any changes in eligibility and
qualifications of the Trustee and any Class B Issuance.

 

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Section 6.11 Calculation Agent. The Trustee shall act as the Calculation Agent
hereunder. Subject to the approval of the Issuer and Noteholders of a majority
of the Outstanding Principal Balance of the Notes, another Person may become the
Calculation Agent on such terms as shall be approved by them. To the extent not
otherwise specifically provided herein, the Trustee shall furnish to the
Calculation Agent, and the Calculation Agent shall furnish to the Trustee, upon
written request such information and copies of such documents as the Trustee or
the Calculation Agent may have and as are necessary for the Calculation Agent
and the Trustee to perform their respective duties under Article III or
otherwise.

Section 6.12 Pledge and Security Agreement and Other Deal Documents. The Trustee
shall enter into the Pledge and Security Agreement with Indevus on the Closing
Date and shall hold the collateral pledged thereunder as part of the Collateral
and the Indenture Estate for purposes of this Indenture. The provisions of this
Article VI shall apply to the Trustee’s exercise of rights and remedies under
the Pledge and Security Agreement, mutatis mutandis. In addition, the Trustee
shall enter into such other Deal Documents on the Closing Date to which it is
party.

Section 6.13 Custody of the Collateral. The Trustee shall hold such of the
Indenture Estate as consists of instruments, deposit accounts, negotiable
documents, money, goods, letters of credit and advices of credit in the State of
New York. The Trustee shall hold such of the Indenture Estate as constitutes
investment property through a securities intermediary, which securities
intermediary shall agree with the Trustee that (a) such investment property
shall at all times be credited to a securities account of the Trustee, (b) such
securities intermediary shall treat the Trustee as entitled to exercise the
rights that comprise each financial asset credited to such securities account,
(c) all property credited to such securities account shall be treated as a
financial asset, (d) such securities intermediary shall comply with entitlement
orders originated by the Trustee without the further consent of any other
Person, (e) such securities intermediary will not agree with any Person other
than the Trustee to comply with entitlement orders originated by such other
Person, (f) such securities account and the property credited thereto shall not
be subject to any lien, security interest or right of set-off in favor of such
securities intermediary or anyone claiming through it (other than the Trustee)
and (g) such agreement shall be governed by the laws of the State of New York.
Except as permitted by this Section 6.13 or as otherwise permitted by any
Transaction Document, the Trustee shall not hold any part of the Indenture
Estate through an agent or a nominee.

Section 6.14 Preservation and Disclosure of Noteholder Lists. The Registrar
shall preserve, in as current a form as is reasonably practicable, all
information as to the names and addresses of the Noteholders received by it,
including the Approved Holder List. At any time when a default or an Event of
Default has occurred and is continuing, in case either (a) three or more
Noteholders that have executed and delivered to the Registrar a Confidentiality
Agreement or (b) one or more Noteholders of at least 20% of the Outstanding
Principal Balance of the Senior Class of Notes that have executed and delivered
to the Registrar a Confidentiality Agreement (in each case, “Applicants”) apply
in writing to the Registrar and furnish to the Registrar reasonable proof that
each such Applicant has owned a Note for a period of at least three months
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Applicants desire to communicate with other Noteholders with respect to their
rights under this Indenture or under the Notes and such application is
accompanied by a copy of the form of proxy or other communication that such
Applicants propose to transmit, then the Registrar shall, within five Business
Days after the receipt of such application, inform such Applicants as to the
approximate number of Noteholders whose names and addresses appear in such
information and as to the approximate cost of mailing to such Noteholders the
form of proxy or other communication, if any, specified in such application. The
Registrar shall, upon the written request of such Applicants, mail to each
Noteholder whose name and address appears in such information a copy of the form
of proxy or other communication that is specified in such request, with
reasonable promptness after a tender to the Registrar of the material to be
mailed and of payment, or provision for the payment, of the reasonable expenses
of mailing. Each and every Noteholder, by receiving and holding the same, agrees
with the Issuer and the Registrar that neither the Registrar nor any agent of
the Issuer or the Registrar shall be held accountable by reason of mailing any
material pursuant to a request made under this Section 6.14.

Section 6.15 Audit Rights.

(a) At the Direction of Noteholders of at least 20% of the Outstanding Principal
Balance of the Senior Class of Notes, the Senior Trustee shall instruct the
Issuer (or any Servicer on behalf of the Issuer) to exercise the Issuer’s rights
pursuant to Section 5.7 of the Purchase and Sale Agreement to furnish a written
request to Indevus to cause an inspection or audit of Counterparty’s books and
records to be conducted pursuant to, in accordance with, and subject to the
limitations set forth in, Section 6.5 of the License Agreement, and the Issuer
shall promptly provide to the Trustee for distribution to Noteholders and
Beneficial Holders on the Approved Holder List any written report that the
Issuer receives with respect to such inspection or audit; provided, however,
that nothing in this Section 6.15(a) shall prohibit or restrict the Issuer’s
ability to unilaterally exercise its rights pursuant to Section 5.7 of the
Purchase and Sale Agreement in the absence of any such Direction of the
Noteholders.

(b) At the Direction of Noteholders of at least 20% of the Outstanding Principal
Balance of the Senior Class of Notes, the Issuer shall, upon not less than ten
Business Days’ prior written notice to the Issuer, permit an independent public
accounting firm of nationally recognized standing selected by such Noteholders
to make such inspection and audit of the books and records of the Issuer as may
reasonably be necessary to determine the correctness of any Distribution Report,
including the calculations made by the Issuer in respect of any Calculation
Date, as set forth in Section 3.5, and the payments made pursuant to Section 3.7
with respect thereto. Such inspection and audit (x) may not be conducted more
than once during any calendar year, (y) shall be conducted by such accounting
firm during normal business hours at such place or places where such books and
records are held (provided, however, that, prior to conducting any such
inspection and audit, such accounting firm shall have entered into a
confidentiality agreement containing provisions no less onerous than those set
forth in Section 5.2 of the Purchase and Sale Agreement and otherwise in form
and substance reasonably satisfactory to the Issuer) and (z) may not be
conducted more than once in respect of any given Calculation Date. Subject to
this Section 6.15(b), the Issuer shall make available to such accounting firm
such books and records of the Issuer reasonably pertinent to such inspection and
audit and shall reasonably cooperate with such accounting firm in connection
therewith. Any and all fees and expenses of such accounting firm incurred in
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“Audit Expenses”) shall constitute Expenses; provided, that any and all such
Audit Expenses exceeding $75,000 per annum shall be borne solely by the
Noteholders in accordance with Section 3.7(e) if the report prepared by such
accounting firm does not disclose that there was a shortfall of 5% or more in
the amounts paid during such period(s) when compared to the amounts that should
have been paid during such period(s) in accordance with this Indenture. Such
accounting firm shall prepare a report disclosing its conclusions with respect
to the accuracy or inaccuracy of the amounts inspected and audited and shall
furnish such report to the Trustee for distribution to Noteholders and
Beneficial Holders on the Approved Holder List. In the event of any inaccuracy
reported by such accounting firm, the Issuer shall cause the amounts to be paid
to the Collection Account for distribution on the immediately succeeding Payment
Date pursuant to Section 3.7(a) to be adjusted in accordance with
Section 3.7(e).

Section 6.16 Compliance with Applicable Anti-Terrorism and Anti-Money Laundering
Regulations. In order to comply with Applicable Laws in effect from time to time
applicable to banking institutions, including those relating to the funding of
terrorist activities and money laundering, the Trustee is required to obtain,
verify and record certain information relating to Persons that maintain a
business relationship with the Trustee. Accordingly, the Issuer agrees to
provide to the Trustee upon its request from time to time such identifying
information and documentation as may be available for the Issuer in order to
enable the Trustee to comply with such Applicable Laws.

Section 6.17 Jurisdiction of Trustee. Each of the Issuer and the Trustee agrees
that the State of New York shall be the Trustee’s jurisdiction for purposes of
Sections 8-110, 9-304 and 9-305 of the UCC.

Section 6.18 Observer.

(a) If an Event of Default with respect to the Notes has occurred and is
continuing and the Trustee has received written notice of (or otherwise has
actual knowledge of) such Event of Default, the Trustee shall, within three
Business Days following receipt of such notice, give to the Noteholders and
Beneficial Holders on the Approved Holder List written notice (the “Initial
Notice”) of such Event of Default advising that each Noteholder and Beneficial
Holder has the right to nominate a Person (the “Nominee”) to be appointed as an
observer of all meetings of the governing body (and committees thereof) of the
Issuer (the “Observer”). Each Noteholder and Beneficial Holder may, but is not
required to, nominate one Nominee by written notice received by the Trustee
within ten Business Days of the date of the Initial Notice (the “Nomination
Period”). Each such notice shall contain at least the following information:
(i) the identity of such Nominee and reasonable detail about the Person
nominated; (ii) the identity of the nominating Noteholder or Beneficial Holder
with respect to such Nominee, together with the Outstanding Principal Balance of
Notes held by such Noteholder or the amount of Beneficial Interests held by such
Beneficial Holder; and (iii) a statement confirming that such Nominee is willing
to serve as Observer if appointed.

(b) If no Nominee is nominated within the Nomination Period, the Trustee shall
promptly notify the Issuer, with a copy to the Noteholders and Beneficial
Holders on the Approved Holder List, that no Nominee has been nominated.

 

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(c) If any Nominee is nominated within the Nomination Period, the Trustee shall,
within three Business Days following the end of the Nomination Period, give to
the Noteholders and Beneficial Holders on the Approved Holder List written
notice (the “Solicitation Notice”) setting forth (i) the identity of each
Nominee and the details relating to each such Nominee provided to the Trustee,
(ii) the identity of the nominating Noteholder or Beneficial Holder with respect
to each Nominee, together with the Outstanding Principal Balance of Notes held
by such Noteholder or the amount of Beneficial Interests held by such Beneficial
Holder, (iii) a statement confirming that each Nominee is willing to serve as
Observer if appointed and (iv) that each Noteholder shall have ten Business Days
after the date of the Solicitation Notice (the “Solicitation Period”) to
indicate by written notice to the Trustee the Nominee (and no more than one
Nominee) from the list of Nominees specified in the Solicitation Notice that it
wishes to have appointed as Observer. Immediately following the end of the
Solicitation Period, the Trustee shall calculate, based upon the written notices
it received during the Solicitation Period, for each Nominee, the Outstanding
Principal Balance of the Notes selecting such Nominee. The Nominee that is
selected by the largest Outstanding Principal Balance of the Notes shall be
designated as Observer (and, in the event that two or more Nominees are selected
by the largest Outstanding Principal Balance of the Notes, then the Trustee
shall furnish a new Solicitation Notice within three Business Days thereof
setting forth only such Nominees selected by such largest Outstanding Principal
Balance of the Notes, and the process set forth above shall be repeated
therefrom to select an Observer). The Trustee shall give written notice to the
Issuer, any Servicer and the Noteholders and Beneficial Holders on the Approved
Holder List of the results of the solicitation, and the Issuer shall (A) provide
the Observer with notice of any meeting of the governing body (or any committee
thereof) of the Issuer in accordance with the Issuer Organizational Documents
(as if the Observer were a member of the governing body or committee thereof, as
the case may be), (B) furnish to the Observer any materials distributed to any
other participant in any such meeting at the same time as such materials are
distributed to such other participant(s), (C) permit the Observer to attend and
observe any such meeting and (D) cause the Issuer’s officers or other
representatives to promptly, accurately and in good faith respond to any
inquiries of the Observer.

(d) At any time, the Noteholders of a majority of the Outstanding Principal
Balance of the Notes may remove the Observer by written notice to the Trustee,
the Issuer and the Noteholders. Upon removal of the Observer, the Trustee shall
request the nomination and selection of a replacement Observer using the
procedures described in this Section 6.18.

(e) The Observer shall provide to the Trustee, for inclusion with the
Distribution Reports, a report summarizing its observations from each meeting of
the governing body (or any committee thereof) of the Issuer that it shall have
attended.

Section 6.19 Notice of Event of Default to Equityholders. If an Event of Default
of which the Trustee has been provided written notice or has actual knowledge
shall have occurred and be continuing, the Trustee shall deliver written notice
to each Equityholder, in accordance with the notice information provided in the
Pledge and Security Agreement to which such Equityholder is party, of the
occurrence and continuance of such Event of Default promptly and in any event
within five Business Days of the Trustee so becoming aware of such Event of
Default; provided, that the Trustee shall not be deemed to have any fiduciary
duty to any Equityholder by reason of this Section 6.19, and the Trustee shall
not be liable to any Equityholder for any failure to comply with this
Section 6.19.

 

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ARTICLE VII

SUCCESSOR TRUSTEES, REGISTRARS, PAYING AGENTS AND CALCULATION AGENTS

Section 7.1 Resignation and Removal of Trustee, Registrar, Paying Agent or
Calculation Agent. Any of the Trustee, the Registrar, the Paying Agent and the
Calculation Agent may resign as to all or any of the classes of Notes at any
time without cause by giving at least 30 days’ prior written notice to the
Issuer, any Servicer and the Noteholders. Noteholders of a majority of the
Outstanding Principal Balance of any class of Notes may at any time remove one
or more of the Trustee, the Registrar, the Paying Agent and the Calculation
Agent as to such class without cause, with the consent of the Issuer (such
consent not to be unreasonably withheld) if no Event of Default shall have
occurred and be continuing, by an instrument in writing delivered to the Issuer,
any Servicer and the Trustee, Registrar, Paying Agent or Calculation Agent being
removed. In addition, the Issuer may remove the Trustee, the Registrar, the
Paying Agent or the Calculation Agent as to any class of Notes if (a) such
Trustee, Registrar, Paying Agent or Calculation Agent fails to comply with
Section 310 of the Trust Indenture Act (as if the Trust Indenture Act applied to
this Indenture) after written request therefor by the Issuer or the Noteholders
of the related class who have been bona fide Noteholders for at least six
months, (b) such Trustee, Registrar, Paying Agent or Calculation Agent fails to
comply with Section 7.2(d) or any other provision hereof, (c) such Trustee,
Registrar, Paying Agent or Calculation Agent is adjudged a bankrupt or an
insolvent, (d) a receiver or public officer takes charge of such Trustee,
Registrar, Paying Agent or Calculation Agent or its property or (e) such
Trustee, Registrar, Paying Agent or Calculation Agent becomes incapable of
acting. References to the Trustee, Registrar, Paying Agent and Calculation Agent
in this Indenture include any successor Trustee, Registrar, Paying Agent or
Calculation Agent, as the case may be, as to all or any of the classes of Notes
appointed in accordance with this Article VII. Any resignation or removal of the
Trustee, Registrar, Paying Agent or Calculation Agent pursuant to this
Section 7.1 shall not be effective until a successor Trustee, Registrar, Paying
Agent or Calculation Agent, as the case may be, shall have been duly appointed
and vested as Trustee, Registrar, Paying Agent or Calculation Agent, as the case
may be, pursuant to Section 7.2.

Section 7.2 Appointment of Successor.

(a) In the case of the resignation or removal of the Trustee, Registrar, Paying
Agent or Calculation Agent as to any class of Notes under Section 7.1, the
Issuer shall promptly appoint a successor Trustee, Registrar, Paying Agent or
Calculation Agent as to such class. Every successor Trustee, Registrar, Paying
Agent or Calculation Agent (i) shall be a national or state bank or trust
company that is authorized by law to perform all the duties imposed upon it by
this Indenture and to exercise corporate trust powers and (ii) shall have (or,
in the case of a corporation included in a bank holding company system, the
related bank holding company shall have) a combined capital and surplus of at
least $50,000,000 as set forth in its (or its related bank holding company’s)
most recent published annual report of condition. If a successor Trustee,
Registrar, Paying Agent or Calculation Agent as to any class of Notes shall not
have been appointed and accepted its appointment hereunder within 60 days after
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Paying Agent or Calculation Agent, as the case may be, gives notice of
resignation as to such class, the retiring Trustee, Registrar, Paying Agent or
Calculation Agent, as the case may be, the Issuer, any Servicer or a majority of
the Outstanding Principal Balance of such class of Notes may petition any court
of competent jurisdiction for the appointment of a successor Trustee, Registrar,
Paying Agent or Calculation Agent as to such class.

(b) Any successor Trustee, Registrar, Paying Agent or Calculation Agent as to
any class of Notes, however appointed, shall execute and deliver to the Issuer,
any Servicer and the predecessor Trustee, Registrar, Paying Agent or Calculation
Agent as to such class an instrument accepting such appointment, and thereupon
such successor Trustee, Registrar, Paying Agent or Calculation Agent, without
further act, shall become vested with all the estates, properties, rights,
powers, duties and trusts of such predecessor Trustee, Registrar, Paying Agent
or Calculation Agent hereunder in the trusts hereunder applicable to it with
like effect as if originally named the Trustee, Registrar, Paying Agent or
Calculation Agent as to such class herein; provided, that, upon the written
request of such successor Trustee, Registrar, Paying Agent or Calculation Agent,
such predecessor Trustee, Registrar, Paying Agent or Calculation Agent shall,
upon payment of all amounts due and owing to it, execute and deliver an
instrument transferring to such successor Trustee, Registrar, Paying Agent or
Calculation Agent, upon the trusts herein expressed applicable to it, all the
estates, properties, rights, powers and trusts of such predecessor Trustee,
Registrar, Paying Agent or Calculation Agent, and such predecessor Trustee,
Registrar, Paying Agent or Calculation Agent shall duly assign, transfer,
deliver and pay over to such successor Trustee, Registrar, Paying Agent or
Calculation Agent all moneys or other property then held by such predecessor
Trustee, Registrar, Paying Agent or Calculation Agent hereunder solely for the
benefit of such class of Notes.

(c) If a successor Trustee, Registrar, Paying Agent or Calculation Agent is
appointed with respect to one or more (but not all) classes of the Notes, the
Issuer, the predecessor Trustee, Registrar, Paying Agent or Calculation Agent
and each successor Trustee, Registrar, Paying Agent or Calculation Agent with
respect to each class of Notes shall execute and deliver an indenture
supplemental hereto that shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the predecessor Trustee, Registrar, Paying Agent or Calculation Agent with
respect to the classes of Notes as to which the predecessor Trustee, Registrar,
Paying Agent or Calculation Agent is not retiring shall continue to be vested in
the predecessor Trustee, Registrar, Paying Agent or Calculation Agent, and shall
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the Notes hereunder by more
than one Trustee, Registrar, Paying Agent or Calculation Agent.

(d) Each Trustee, Registrar, Paying Agent or Calculation Agent shall be an
Eligible Institution and shall meet the Eligibility Requirements and the
requirements of Section 6.9, if there be such an institution willing, able and
legally qualified to perform the duties of a Trustee, Registrar, Paying Agent or
Calculation Agent hereunder.

(e) Any Person into which the Trustee, Registrar, Paying Agent or Calculation
Agent may be merged or converted or with which it may be consolidated, or any
Person resulting from any merger, conversion or consolidation to which the
Trustee, Registrar, Paying Agent or Calculation Agent shall be a party, or any
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trust business of the Trustee, Registrar, Paying Agent or Calculation Agent
(including the administration of the trust created by this Indenture) may be
transferred, shall, subject to the terms of Section 7.2(c), be the Trustee,
Registrar, Paying Agent or Calculation Agent, as the case may be, under this
Indenture without the execution or filing of any paper with any party hereto or
any further act on the part of any party hereto, except where an instrument of
transfer or assignment is required by law to effect such succession, anything
herein to the contrary notwithstanding.

ARTICLE VIII

INDEMNITY

Section 8.1 Indemnity. The Issuer shall indemnify and defend the Trustee (and
its officers, directors, managers, employees and agents) for, and hold it
harmless from and against, and reimburse the Trustee for, any loss, liability or
expense incurred by it without bad faith, gross negligence or willful misconduct
on its part in connection with the acceptance or administration of this
Indenture and its performance of its duties under this Indenture and the Notes
or any other Transaction Document, including the costs and expenses of defending
itself against any claim or liability and of complying with any process served
upon it or any of its officers in connection with the exercise or performance of
any of its powers or duties, and hold it harmless against any loss, liability or
reasonable expense incurred without bad faith, gross negligence or willful
misconduct on its part, arising out of or in connection with actions taken or
omitted to be taken in reliance on any Officer’s Certificate furnished
hereunder, or the failure to furnish any such Officer’s Certificate required to
be furnished hereunder. The Trustee shall notify the Issuer promptly of any
claim asserted against the Trustee for which it may seek indemnity; provided,
however, that failure to provide such notice shall not invalidate any right to
indemnity hereunder. The Issuer shall defend any such claim and the Trustee
shall cooperate in the defense thereof. The Trustee may have separate counsel
and the Issuer shall pay the reasonable fees and expenses of one separate
outside counsel for the Trustee. The Issuer need not pay for any settlements
made without its consent; provided, that such consent shall not be unreasonably
withheld or delayed. The Issuer need not reimburse any expense or provide any
indemnity against any loss, liability or expense incurred by the Trustee through
bad faith, gross negligence or willful misconduct.

Section 8.2 Noteholders’ Indemnity. The Trustee shall be entitled, subject to
such Trustee’s duty during a Default to act with the standard of care required
under this Indenture, to be indemnified by the Noteholders of any class of Notes
before proceeding to exercise any right or power under this Indenture or any
other Transaction Document at the request or Direction of such Noteholders.

Section 8.3 Survival. The provisions of Section 8.1 and Section 8.2 shall
survive the termination of this Indenture or the earlier resignation or removal
of the Trustee.

 

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ARTICLE IX

MODIFICATION

Section 9.1 Modification with Consent of Noteholders. Subject to Section 3.7(d),
with the consent of Noteholders of a majority of the Outstanding Principal
Balance of the Notes (voting or acting as a single class), the Trustee may agree
to amend, modify or waive any provision of (or consent to the amendment,
modification or wavier of) this Indenture, the Notes, the Pledge and Security
Agreement or the Servicing Agreement. However, no such amendment, modification,
consent or waiver may, without the consent of Noteholders of 100% of the
Outstanding Principal Balance of the class of Notes affected thereby:

(a) reduce the percentage of Noteholders of any such class of Notes required to
take or approve any action hereunder or thereunder;

(b) reduce the amount or change the time of payment of any amount owing or
payable with respect to any such class of Notes (including pursuant to any
Redemption) or change the rate of interest or change the manner of calculation
of interest payable with respect to any such class of Notes;

(c) alter or modify in any respect the provisions of this Indenture with respect
to the Collateral or any Issuer Pledged Collateral for the Notes, the provisions
of the Pledge and Security Agreement with respect to the related Issuer Pledged
Collateral for the Notes or the manner of payment or the order of priorities in
which payments or distributions hereunder will be made as between the
Noteholders of such Notes and the Issuer or as among the Noteholders (including
pursuant to Section 3.7);

(d) consent to any assignment of the Issuer’s rights to a party other than the
Trustee for the benefit of the Noteholders; or

(e) alter the provisions relating to the Interest Reserve Account in a manner
adverse to any Noteholder;

provided, that the Noteholders of a majority of the Outstanding Principal
Balance of the Senior Class of Notes, by written notice to the Trustee, may
waive any Default or Event of Default to the extent provided in Section 4.5.

It shall not be necessary for the consent of the Noteholders under this
Section 9.1 to approve the particular form of any proposed amendment or waiver,
but it shall be sufficient if such consent approves the substance thereof. Any
such modification approved by the required Noteholders of any class of Notes
will be binding on the Noteholders of the relevant class of Notes and each party
to this Indenture.

After an amendment under this Section 9.1 becomes effective, the Issuer or, at
the direction of the Issuer, the Trustee shall mail to the Noteholders a notice
briefly describing such amendment. Any failure of the Issuer or the Trustee to
mail such notice, or any defect therein, shall not, however, in any way impair
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After an amendment under this Section 9.1 becomes effective, it shall bind every
Noteholder, whether or not notation thereof is made on any Note held by such
Noteholder.

Section 9.2 Modification Without Consent of Noteholders. Subject to
Section 3.7(d), the Trustee may, without the consent of any Noteholder,
(i) agree to amend, modify or waive any provision of (or consent to the
amendment, modification or waiver of) this Indenture, the Notes, the Pledge and
Security Agreement or the Servicing Agreement to:

(a) establish the terms of any Refinancing Notes or Class B Notes pursuant to
Section 2.15 and Section 2.16, respectively;

(b) evidence the succession of a successor to the Trustee, Registrar or
Calculation Agent, the removal of the Trustee, Registrar or Calculation Agent or
the appointment of any separate or additional trustee or trustees and to define
the rights, powers, duties and obligations conferred upon any such separate
trustee or trustees or co-trustees;

(c) correct, confirm or amplify the description of any property at any time
subject to the lien of this Indenture or to convey, transfer, assign, mortgage
or pledge any property to or with the Trustee;

(d) cure any ambiguity in or correct or supplement any defective or inconsistent
provision of this Indenture, the Notes, the Pledge and Security Agreement or the
Servicing Agreement in any manner that will not adversely affect the interests
of the Noteholders in any material respect as confirmed in an Officer’s
Certificate of the Issuer;

(e) grant or confer upon the Trustee for the benefit of the Noteholders any
additional rights, remedies, powers, authority or security that may be lawfully
granted or conferred and that are not contrary to this Indenture;

(f) add to the covenants or agreements to be observed by the Issuer, which are
not contrary to this Indenture, or to add Events of Default for the benefit of
the Noteholders;

(g) comply with the requirements of the SEC or any regulatory body or any
Applicable Law; or

(h) effect any indenture supplemental hereto or any other amendment,
modification, supplement, waiver or consent with respect to this Indenture, the
Notes, the Pledge and Security Agreement or the Servicing Agreement; provided,
that such indenture supplemental hereto, amendment, modification, supplement,
waiver or consent will not adversely affect the interests of the Noteholders in
any material respect as confirmed in an Officer’s Certificate of the Issuer.

After an amendment under this Section 9.2 becomes effective, the Issuer or, at
the direction of the Issuer, the Trustee shall mail to the Noteholders a notice
briefly describing such amendment. Any failure of the Issuer or the Trustee to
mail such notice, or any defect therein, shall not, however, in any way impair
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After an amendment under this Section 9.2 becomes effective, it shall bind every
Noteholder, whether or not notation thereof is made on any Note held by such
Noteholder.

Section 9.3 Subordination; Priority of Payments. The subordination provisions
contained in Article X may not be amended or modified without the consent of
Noteholders of 100% of the Outstanding Principal Balance of the class of Notes
affected thereby. In no event shall the provisions set forth in Section 3.7
relating to the priority of payment of Expenses be amended or modified.

Section 9.4 Execution of Amendments by Trustee. In executing, or accepting the
additional trusts created by, any amendment or modification to this Indenture
permitted by this Article IX or the modifications thereby of the trusts created
by this Indenture, the Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Officer’s Certificate and an Opinion of Counsel
stating that the execution of such amendment is authorized or permitted by this
Indenture. The Trustee may, but shall not be obligated to, enter into any such
amendment that affects the Trustee’s own rights, duties or immunities under this
Indenture or otherwise.

Section 9.5 Conformity with Trust Indenture Act. Every indenture supplemental
hereto pursuant to this Article IX shall conform to the requirements of the
Trust Indenture Act as then in effect (as if the Trust Indenture Act applied to
this Indenture).

ARTICLE X

SUBORDINATION

Section 10.1 Subordination of the Notes.

(a) Each of the Issuer and the Trustee (on behalf of the Noteholders) covenants
and agrees, and each Noteholder, by its acceptance of a Note, covenants and
agrees, that the Notes of each class will be issued subject to the provisions of
this Article X. Each Noteholder, by its acceptance of a Note, further agrees
that all amounts payable on any Note will, to the extent provided in Section 3.7
and in the manner set forth in this Article X, be subordinated in right of
payment to the prior payment in full of all Expenses payable to the Service
Providers and all Tax Distributions payable to the Equityholders pursuant to
this Indenture and the other Transaction Documents. Each Noteholder of a Class B
Note, by its acceptance of a Class B Note, further agrees that all amounts
payable on any Class B Note will, to the extent provided in Section 3.7 and in
the manner set forth in this Article X, be subordinated in right of payment to
the payment in full of the Class A Notes. Any claim to payment so stated to be
subordinated is referred to as a “Subordinated Claim”; each claim to payment to
which another claim to payment is a Subordinated Claim is referred to as a
“Senior Claim” with respect to such Subordinated Claim.

(b) If, prior to the payment in full of all Senior Claims then due and payable,
the Trustee or any Noteholder of a Subordinated Claim shall have received any
payment or distribution in respect of such Subordinated Claim in excess of the
amount to which such Noteholder was then entitled under Section 3.7, then such
payment or distribution shall be received and held in trust by such Person and
paid over or delivered to the Trustee for application as provided in
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(c) If any Service Provider, any Equityholder, the Trustee or any Noteholder of
any Senior Claim receives any payment in respect of any Senior Claim that is
subsequently invalidated, declared preferential, set aside and/or required to be
repaid to a trustee, receiver or other party, then, to the extent such payment
is so invalidated, declared preferential, set aside and/or required to be
repaid, such Senior Claim shall be revived and continue in full force and effect
and shall be entitled to the benefits of this Article X, all as if such payment
had not been received.

(d) The Trustee (on its own behalf and on behalf of the Noteholders) and the
Issuer each confirm that the payment priorities specified in Section 3.7 shall
apply in all circumstances.

(e) Each Noteholder, by its acceptance of a Note, authorizes and expressly
directs the Trustee on its behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article X, and
appoints the Trustee its attorney-in-fact for such purposes, including, in the
event of any dissolution, winding-up, liquidation or reorganization of the
Issuer (whether in bankruptcy, insolvency, receivership, reorganization or
similar proceedings or upon an assignment for the benefit of creditors or
otherwise), any actions tending towards liquidation of the property and assets
of the Issuer or the filing of a claim for the unpaid balance of its Notes in
the form required in those proceedings.

(f) If payment on the Notes is accelerated as a result of an Event of Default,
the Issuer shall promptly notify the holders of the Senior Claims of such
acceleration.

(g) After all Senior Claims are paid in full and until the Subordinated Claims
are paid in full, and to the extent that such Senior Claims shall have been paid
with funds that would, but for the subordination pursuant to this Article X,
have been paid to and retained by such holders of Subordinated Claims, the
holders of Subordinated Claims shall be subrogated to the rights of holders of
Senior Claims to receive payments applicable to Senior Claims. A payment made
under this Article X to holders of Senior Claims that otherwise would have been
made to the holders of Subordinated Claims is not, as between the Issuer and the
holders of Subordinated Claims, a payment by the Issuer.

(h) No right of any holder of any Senior Claim to enforce the subordination of
any Subordinated Claim shall be impaired by an act or failure to act by the
Issuer or the Trustee or by any failure by either the Issuer or the Trustee to
comply with this Indenture.

(i) Each Noteholder by accepting a Note acknowledges and agrees that the
foregoing subordination provisions are, and are intended to be, an inducement
and a consideration to each holder of any Senior Claim, whether such Senior
Claim was created or acquired before or after the issuance of such Noteholder’s
claim, to acquire and continue to hold such Senior Claim, and such holder of any
Senior Claim shall be deemed conclusively to have relied on such subordination
provisions in acquiring and continuing to hold such Senior Claim. Each holder of
a Subordinated Claim agrees to comply with the provisions of Article IV.

 

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ARTICLE XI

DISCHARGE OF INDENTURE

Section 11.1 Discharge of Indenture.

(a) When (i) all outstanding Secured Obligations have been satisfied and the
Issuer delivers to the Trustee all Outstanding Notes (other than Notes replaced
pursuant to Section 2.8) for cancellation or (ii) all Outstanding Notes have
become due and payable, whether at maturity or as a result of the mailing of a
notice of an Optional Redemption pursuant to Section 3.9(b) or any other
Redemption pursuant to Section 3.9(c), in each case that is subject to
Section 3.10(c), and the Issuer irrevocably deposits in the Redemption Account
funds sufficient to pay all remaining Expenses accrued and payable through such
date and to pay all principal of and interest and Premium (if any) on
Outstanding Notes at maturity or upon redemption all Outstanding Notes,
including interest and any Premium thereon to maturity or the Redemption Date
(other than Notes replaced pursuant to Section 2.8), and if in either case the
Issuer pays all other sums payable hereunder by the Issuer, then this Indenture
shall, subject to Section 11.1(b), cease to be of further effect and the
security interest granted to the Trustee hereunder in the Collateral and the
Indenture Estate shall terminate. The Trustee shall acknowledge satisfaction and
discharge of this Indenture, and file all UCC termination statements and similar
documents prepared by the Issuer, on demand of the Issuer accompanied by an
Officer’s Certificate and an Opinion of Counsel, at the cost and expense of the
Issuer, to the effect that any conditions precedent to a discharge of this
Indenture have been met.

(b) Notwithstanding Section 11.1(a), the Issuer’s obligations in Section 3.7(b),
Section 3.7(d) and Section 8.1 and the Trustee’s obligations in Section 12.13
shall survive the satisfaction and discharge of this Indenture.

ARTICLE XII

MISCELLANEOUS

Section 12.1 Right of Trustee to Perform. If the Issuer for any reason fails to
observe or punctually to perform any of its obligations to the Trustee, whether
under this Indenture, under any of the other Transaction Documents or otherwise,
the Trustee shall have the power (but shall have no obligation), on behalf of or
in the name of the Issuer or otherwise, to perform such obligations or cause
performance of such obligations and to take any steps that the Trustee may, in
its absolute discretion, consider appropriate with a view to remedying, or
mitigating the consequences of, such failure by the Issuer, in which case the
reasonable expenses of the Trustee, including the fees and expenses of its
counsel, incurred in connection therewith shall be payable by the Issuer under
Section 8.1; provided, that no exercise or failure to exercise this power by the
Trustee shall in any way prejudice the Trustee’s other rights under this
Indenture or any of the other Transaction Documents.

Section 12.2 Waiver. Any waiver by any party of any provision of this Indenture
or any right, remedy or option hereunder shall only prevent and estop such party
from thereafter enforcing such provision, right, remedy or option if such waiver
is given in writing and only as to the specific instance and for the specific
purpose for which such waiver was given. The failure or refusal of any party
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dealing, upon the strict performance of any of the terms or provisions of this
Indenture by any party hereto or the partial exercise of any right, remedy or
option hereunder shall not be construed as a waiver or relinquishment of any
such term or provision, but the same shall continue in full force and effect. No
failure on the part of the Trustee to exercise, and no delay on its part in
exercising, any right or remedy under this Indenture will operate as a waiver
thereof, nor will any single or partial exercise of any right or remedy preclude
any other or further exercise thereof or the exercise of any other right or
remedy. The rights and remedies provided in this Indenture are cumulative and
not exclusive of any rights or remedies provided by law.

Section 12.3 Severability. In the event that any provision of this Indenture or
the application thereof to any party hereto or to any circumstance or in any
jurisdiction governing this Indenture shall, to any extent, be invalid or
unenforceable under any applicable statute, regulation or rule of law, then such
provision shall be deemed inoperative to the extent that it is invalid or
unenforceable, and the remainder of this Indenture, and the application of any
such invalid or unenforceable provision to the parties, jurisdictions or
circumstances other than to whom or to which it is held invalid or
unenforceable, shall not be affected thereby nor shall the same affect the
validity or enforceability of this Indenture. The parties hereto further agree
that the holding by any court of competent jurisdiction that any remedy pursued
by the Trustee hereunder is unavailable or unenforceable shall not affect in any
way the ability of the Trustee to pursue any other remedy available to it.

Section 12.4 Restrictions on Exercise of Certain Rights. The Trustee and, during
the continuance of a payment Default with respect to the Senior Class of Notes,
the Senior Trustee, except as otherwise provided in Section 4.4, Section 4.9 and
Section 4.11, may sue for recovery or take any other steps for the purpose of
recovering any of the obligations hereunder or any other debts or liabilities
whatsoever owing to it by the Issuer. Each of the Noteholders shall at all times
be deemed to have agreed by virtue of the acceptance of the Notes that only the
Trustee and, during the continuance of a payment Default with respect to the
Senior Class of Notes, the Senior Trustee, except as provided in Section 4.4,
Section 4.9 and Section 4.11, may take any steps for the purpose of procuring
the appointment of an administrative receiver, examiner, receiver or similar
officer or the making of an administration order or for instituting any
bankruptcy, reorganization, arrangement, insolvency, winding-up, liquidation,
composition, examination or any like proceedings under Applicable Law.

Section 12.5 Notices. All Notices shall be in writing and shall be effective
(a) upon receipt when sent through the mails, registered or certified mail,
return receipt requested, postage prepaid, with such receipt to be effective the
date of delivery indicated on the return receipt, (b) upon receipt when sent by
an overnight courier, (c) on the date personally delivered to an authorized
officer of the party to which sent, (d) on the date transmitted by legible
telecopier transmission with a confirmation of receipt or (e) in the case of
reports under Article III and any other report that is of a routine nature, on
the date sent by first class mail or overnight courier or transmitted by legible
telecopier transmission, in all cases, with a copy emailed to the recipient at
the applicable address, addressed to the recipient as follows:

if to the Issuer, to:

Ledgemont Royalty Sub LLC

c/o Indevus Pharmaceuticals, Inc.

33 Hayden Avenue

Lexington, MA 02421-7996

Attention: Mark S. Butler, General Counsel

Telephone: 781-402-3402

Facsimile: 781-761-0402

Email: mbutler@indevus.com

 

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if to the Trustee, the Registrar, the Paying Agent or the Calculation Agent, to:

U.S. Bank National Association

One Federal Street, 3rd Floor

Boston, Massachusetts 02110

Attention: Corporate Trust Services (Ledgemont Royalty Sub LLC)

Telephone: 617-603-6553

Facsimile: 617-603-6683

A copy of each notice given hereunder to any party hereto shall also be given to
each of the other parties hereto. Each party hereto may, by notice given in
accordance herewith to each of the other parties hereto, designate any further
or different address to which subsequent Notices shall be sent.

Section 12.6 Assignments. This Indenture shall be a continuing obligation of the
Issuer and shall (a) be binding upon the Issuer and its successors and assigns
and (b) inure to the benefit of and be enforceable by the Trustee and by its
successors, transferees and assigns and, as and to the extent provided in
Section 3.7(d), the Equityholders. The Issuer may not assign any of its
obligations under this Indenture or delegate any of its duties hereunder.

Section 12.7 Application to Court. The Trustee may at any time after the service
of an Acceleration Notice apply to any court of competent jurisdiction for an
order that the terms of this Indenture be carried into execution under the
direction of such court and for the appointment of a Receiver of the Collateral
or any part thereof and for any other order in relation to the administration of
this Indenture as the Trustee shall deem fit, and it may assent to or approve
any application to any court of competent jurisdiction made at the instigation
of any of the Noteholders and shall be indemnified by the Issuer against all
costs, charges and expenses incurred by it in relation to any such application
or proceedings.

Section 12.8 GOVERNING LAW. THIS INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL SUBSTANTIVE LAWS OF THE STATE OF NEW YORK WITHOUT
REFERENCE TO THE RULES THEREOF RELATING TO CONFLICTS OF LAW OTHER THAN SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.

 

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Section 12.9 Jurisdiction.

(a) Each of the parties hereto agrees that the U.S. federal and State of New
York courts located in the Borough of Manhattan, The City of New York shall have
jurisdiction to hear and determine any suit, action or proceeding, and to settle
any disputes, which may arise out of or in connection with this Indenture and,
for such purposes, submits to the jurisdiction of such courts. Each of the
parties hereto waives any objection that it might now or hereafter have to the
U.S. federal or State of New York courts located in the Borough of Manhattan,
The City of New York being nominated as the forum to hear and determine any
suit, action or proceeding, and to settle any disputes, which may arise out of
or in connection with this Indenture and agrees not to claim that any such court
is not a convenient or appropriate forum. Each of the parties hereto has
irrevocably designated, appointed and empowered the respective Persons named in
Exhibit C as its designee, appointee and agent to receive, accept and
acknowledge for and on its behalf, and its properties, assets and revenues,
service of any and all legal process, summons, notices and documents that may be
served in any suit, action or proceeding brought against such party in any
United States or state court arising out of or relating to this Indenture or the
Notes. If for any reason any such designee, appointee and agent hereunder shall
cease to be available to act as such, such party agrees to designate a new
designee, appointee and agent in the Borough of Manhattan, The City of New York
on the terms and for the purposes of this Section 12.9 satisfactory to such
other party. Each party further hereby irrevocably consents and agrees to the
service of any and all legal process, summons, notices and documents in any
suit, action or proceeding against such party by serving a copy thereof upon the
relevant agent for service of process referred to in this Section 12.9 (whether
or not the appointment of such agent shall for any reason prove to be
ineffective or such agent shall accept or acknowledge such service) or by
mailing copies thereof by registered or certified mail, postage prepaid, to such
party at its address specified in or designated pursuant to this Indenture. Each
party agrees that the failure of any such designee, appointee and agent to give
any notice of such service to it shall not impair or affect in any way the
validity of such service or any judgment rendered in any action or proceeding
based thereon. Nothing herein shall in any way be deemed to limit the ability of
the Issuer or the Trustee and the Noteholders, as the case may be, to serve any
such legal process, summons, notices and documents in any other manner permitted
by Applicable Law or to obtain jurisdiction over such party or bring suits,
actions or proceedings against such party in such other jurisdictions, and in
such manner, as may be permitted by Applicable Law.

(b) The submission to the jurisdiction of the courts referred to in
Section 12.9(a) shall not (and shall not be construed so as to) limit the right
of the Trustee to take proceedings against the Issuer in any other court of
competent jurisdiction, nor shall the taking of proceedings in any one or more
jurisdictions preclude the taking of proceedings in any other jurisdiction,
whether concurrently or not.

(c) Each of the parties hereto hereby consents generally in respect of any legal
action or proceeding arising out of or in connection with this Indenture to the
giving of any relief or the issue of any process in connection with such action
or proceeding, including the making, enforcement or execution against any
property whatsoever (irrespective of its use or intended use) of any order or
judgment that may be made or given in such action or proceeding.

 

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(d) If, for the purpose of obtaining a judgment or order in any court, it is
necessary to convert a sum due hereunder to any Noteholder from U.S. dollars
into another currency, the Issuer has agreed, and each Noteholder by holding a
Note will be deemed to have agreed, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which, in
accordance with normal banking procedures, such Noteholder could purchase U.S.
dollars with such other currency in the Borough of Manhattan, The City of New
York on the Business Day preceding the day on which final judgment is given.

(e) The obligation of the Issuer in respect of any sum payable by it to a
Noteholder shall, notwithstanding any judgment or order in a currency other than
U.S. dollars (the “Judgment Currency”), be discharged only to the extent that,
on the Business Day following receipt by such Noteholder of such security of any
sum adjudged to be so due in the Judgment Currency, such Noteholder may in
accordance with normal banking procedures purchase U.S. dollars with the
Judgment Currency. If the amount of U.S. dollars so purchased is less than the
sum originally due to such Noteholder in the Judgment Currency (determined in
the manner set forth in Section 12.9(d)), the Issuer agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify such Noteholder
against such loss, and, if the amount of the U.S. dollars so purchased exceeds
the sum originally due to such Noteholder, such Noteholder agrees to remit to
the Issuer such excess, provided that such Noteholder shall have no obligation
to remit any such excess as long as the Issuer shall have failed to pay such
Noteholder any obligations due and payable under the Notes of such Noteholder,
in which case such excess may be applied to such obligations of the Issuer under
such Notes in accordance with the terms thereof. The foregoing indemnity shall
constitute a separate and independent obligation of the Issuer and shall
continue in full force and effect notwithstanding any such judgment or order as
aforesaid.

(f) EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS
INDENTURE OR ANY MATTER ARISING HEREUNDER.

Section 12.10 Counterparts. This Indenture may be executed in one or more
counterparts by the parties hereto, and each such counterpart shall be
considered an original and all such counterparts shall constitute one and the
same instrument.

Section 12.11 Table of Contents and Headings. The Table of Contents and headings
of the Articles and Sections of this Indenture have been inserted for
convenience of reference only, are not to be considered a part hereof and shall
in no way modify or restrict any of the terms or provisions hereof.

Section 12.12 Trust Indenture Act. This Indenture shall not be qualified under
the Trust Indenture Act and shall not be subject to the provisions of the Trust
Indenture Act, although it shall incorporate such provisions for ease of
reference.

Section 12.13 Confidential Information. The Trustee, in its individual capacity
and as Trustee, agrees and acknowledges that all information (including
Confidential Information) provided to the Trustee by an Equityholder or Indevus
may be considered to be proprietary and confidential information of
Counterparty, Supernus or Madaus. The Trustee agrees to take all

 

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reasonable precautions necessary to keep such information confidential, which
precautions shall be no less stringent than those that the Trustee employs to
protect its own confidential information. The Trustee shall not disclose to any
third party other than as set forth herein, and shall not use for any purpose
other than the exercise of the Trustee’s rights and the performance of its
obligations under this Indenture, any such information without the prior written
consent of Counterparty, Supernus or Madaus, as the case may be. In addition,
the Trustee agrees to be bound by the provisions of Section 5.2 of the Purchase
and Sale Agreement to the extent it receives confidential information of
Counterparty, Supernus or Madaus pursuant to Section 3.1 of the Servicing
Agreement or Section 5.3. The Trustee shall limit access to such information
received hereunder to (a) its directors, officers, managers and employees and
(b) its legal advisors, to each of whom disclosure of such information is
necessary for the purposes described above; provided, however, that in each case
such party has expressly agreed to maintain such information in confidence under
terms and conditions substantially identical to the terms of this Section 12.13.

The Trustee agrees that none of Counterparty, Supernus or Madaus has any
responsibility whatsoever for any reliance on such information by the Trustee or
by any Person to whom such information is disclosed in connection with this
Indenture, whether related to the purposes described above or otherwise. Without
limiting the generality of the foregoing, the Trustee agrees that none of
Counterparty, Supernus or Madaus makes any representation or warranty whatsoever
to it with respect to such information or its suitability for such purposes. The
Trustee further agrees that it shall not acquire any rights against
Counterparty, Supernus or Madaus or any employee, officer, director, manager,
representative or agent of Counterparty, Supernus or Madaus (together with
Counterparty, Supernus or Madaus, “Confidential Parties”) as a result of the
disclosure of such information to the Trustee or to any Noteholder or Beneficial
Holder and that no Confidential Party has any duty, responsibility, liability or
obligation to any Person as a result of any such disclosure.

In the event the Trustee is required to disclose any such information received
hereunder in order to comply with any laws, regulations or court orders, it may
disclose such information only to the extent necessary for such compliance;
provided, however, that it shall give Counterparty, Supernus or Madaus, as the
case may be, and the Issuer reasonable advance written notice of any such court
proceeding in which such disclosure may be required pursuant to a court order so
as to afford Counterparty, Supernus or Madaus, as the case may be, a full and
fair opportunity to oppose the issuance of such order and to appeal therefrom
and shall cooperate reasonably with Counterparty, Supernus or Madaus, as the
case may be, in opposing such order and in securing confidential treatment of
any such information to be disclosed and/or obtaining a protective order
narrowing the scope of such disclosure.

The Trustee agrees that each of Counterparty, Supernus and Madaus is an express
third-party beneficiary of the provisions of this Section 12.13.

Each of the Calculation Agent, the Paying Agent and the Registrar agrees to be
bound by this Section 12.13 to the same extent as the Trustee.

 

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Section 12.14 Limited Recourse. Each of the parties hereto accepts that the
enforceability against the Issuer of the obligations of the Issuer hereunder and
under the Notes shall be limited to the assets of the Issuer, whether tangible
or intangible, real or personal (including the Collateral) and the proceeds
thereof. Once all such assets have been realized upon and such assets (and
proceeds thereof) have been applied in accordance with Article III, any
outstanding obligations of the Issuer shall be extinguished. Each of the parties
hereto further agrees that it shall take no action against any employee,
director, officer or administrator of the Issuer, an Equityholder or the Trustee
in relation to this Indenture; provided, that nothing herein shall limit the
Issuer (or its permitted successors or assigns, including any party hereto that
becomes such a successor or assign) from pursuing claims, if any, against any
such Person. The provisions of this Section 12.14 shall survive termination of
this Indenture; provided, further, that the foregoing shall not in any way
limit, impair or otherwise affect any rights of the Trustee or the Noteholders
to proceed against any such Person (a) for intentional and willful fraud or
intentional and willful misrepresentations on the part of or by such Person or
(b) for the receipt of any distributions or payments to which the Issuer or any
successor in interest is entitled, other than distributions expressly permitted
pursuant to this Indenture and the other Deal Documents.

Section 12.15 Tax Matters.

(a) The Issuer has entered into this Indenture, and the Notes will be issued,
with the intention that, for federal, state and local income, single business
and franchise Tax purposes, the Notes will qualify as indebtedness. The Issuer,
by entering into this Indenture, and each Noteholder and Beneficial Holder,
agree to treat the Notes for federal, state and local income, single business
and franchise Tax purposes as indebtedness.

(b) The Issuer shall not be obligated to pay any additional amounts to the
Noteholders or Beneficial Holders as a result of any withholding or deduction
for, or on account of, any present or future Taxes imposed on payments in
respect of the Notes. Unless otherwise required by Applicable Law, so long as a
Person shall have delivered to the Issuer a properly completed IRS Form W-9, IRS
Form W-8BEN, IRS Form W-8ECI or other applicable IRS Form W-8 or, in the case of
a Person claiming the exemption from U.S. federal withholding tax under
Section 871(h) of the Code or Section 881(c) of the Code with respect to
payments of “portfolio interest”, the appropriate properly completed IRS Form
W-8 together with a certificate substantially in the form of Exhibit K, neither
the Issuer nor the Trustee shall withhold Taxes on payments of interest made to
any such Person. Any such IRS Form W-8BEN shall specify whether the Noteholder
or Beneficial Holder to whom the form relates is entitled to the benefits of any
applicable income tax treaty.

(c) Provided that the Issuer and the Trustee comply with Section 5.2(u),
Section 12.15(a) and Section 12.15(b), (i) if any withholding Tax is imposed on
the Issuer’s payment under the Notes to any Noteholder or Beneficial Holder,
such Tax shall reduce the amount otherwise distributable to such Noteholder or
Beneficial Holder, as the case may be, (ii) the Trustee is hereby authorized and
directed to retain from amounts otherwise distributable to any Noteholder or
Beneficial Holder sufficient funds for the payment of any withholding Tax that
is legally owed by the Issuer (but such authorization shall not prevent the
Trustee from contesting any such withholding Tax in appropriate proceedings and
withholding payment of such Tax, if permitted by Applicable Law, pending the
outcome of such proceedings) and (iii) the amount of any withholding Tax imposed
with respect to any Noteholder or Beneficial Holder shall be treated as cash
distributed to such Noteholder or Beneficial Holder, as the case may be, at the

 

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time it is withheld by the Trustee and remitted to the appropriate taxing
authority. Provided that the Issuer and the Trustee comply with Section 5.2(u),
Section 12.15(a) and Section 12.15(b), if there is a possibility that
withholding Tax is payable with respect to a payment under the Notes, the
Trustee may in its sole discretion withhold such amounts in accordance with this
Section 12.15. If any Noteholder or Beneficial Holder wishes to apply for a
refund of any such withholding Tax, the Trustee shall reasonably cooperate with
such Noteholder or Beneficial Holder, as the case may be, in making such claim,
and providing information necessary to enable the Noteholder or Beneficial Owner
to establish a basis for such refund and calculate the amount of such refund
due, so long as such Noteholder or Beneficial Holder, as the case may be, agrees
to reimburse the Trustee for any out-of-pocket expenses incurred. Nothing herein
shall impose an obligation on the part of the Trustee to determine the amount of
any Tax or withholding obligation on the part of the Issuer or in respect of the
Notes.

Section 12.16 Waiver. The Issuer waives any right to contest or otherwise assert
that the Purchase and Sale Agreement is other than a true, absolute and
irrevocable sale and assignment by Indevus to the Issuer of the Purchased Assets
under Applicable Law.

Section 12.17 Distribution Reports. Each party hereto acknowledges and agrees
that the Trustee may effect delivery of any Distribution Report (including the
materials accompanying such Distribution Report) by making such Distribution
Report and accompanying materials available by posting such Distribution Report
and accompanying materials on IntraLinks or a substantially similar electronic
transmission system; provided, however, that, upon written notice to the
Trustee, any Noteholder may decline to receive such Distribution Report and
accompanying materials via IntraLinks or a substantially similar electronic
transmission system, in which case such Distribution Report and accompany
materials shall be provided as otherwise set forth in the Deal Documents.
Subject to the conditions set forth in the proviso in the immediately preceding
sentence, nothing in this Section 12.17 shall prejudice the right of the Trustee
to make such Distribution Report and accompany materials available in any other
manner specified in the Deal Documents.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Indenture to be duly
executed, all as of the date first written above.

 

LEDGEMONT ROYALTY SUB LLC,

    as Issuer

By:   Indevus Pharmaceuticals, Inc., its Manager By:       Name:   Glenn L.
Cooper   Title:   Chairman and Chief Executive Officer

U.S. BANK NATIONAL ASSOCIATION,

    as Trustee

By:       Name:     Title:  

--------------------------------------------------------------------------------

SCHEDULE A

TAX DISTRIBUTION MINIMUM AMOUNTS

 

Payment Date

   Minimum Amount

November 5, 2008

   $ 1,873,737

February 5, 2009

   $ 2,208,527

May 5, 2009

   $ 2,552,160

August 5, 2009

   $ 3,006,258

November 5, 2009

   $ 3,654,301

February 5, 2010

   $ 4,747,338

May 5, 2010

   $ 3,479,834

August 5, 2010

   $ 4,340,481

November 5, 2010

   $ 5,151,777

February 5, 2011

   $ 6,350,899

May 5, 2011

   $ 6,988,498

August 5, 2011

   $ 7,494,845

November 5, 2011

   $ 7,881,607

February 5, 2012

   $ 8,790,139

May 5, 2012

   $ 10,640,086

August 5, 2012

   $ 10,341,234

November 5, 2012

   $ 10,065,562

February 5, 2013

   $ 10,350,780

May 5, 2013

   $ 10,015,062

August 5, 2013

   $ 9,717,509

November 5, 2013

   $ 9,376,592

February 5, 2014

   $ 26,411,180

May 5, 2014

   $ 8,828,028

August 5, 2014

   $ 8,173,295

November 5, 2014

   $ 7,452,745

February 5, 2015

   $ 7,008,348

May 5, 2015

   $ 6,809,361

August 5, 2015

   $ 6,544,387

November 5, 2015

   $ 6,293,588

February 5, 2016

   $ 6,556,731

May 5, 2016

   $ 6,358,872

August 5, 2016

   $ 6,211,992

November 5, 2016

   $ 6,119,521

February 5, 2017

   $ 6,295,734

May 5, 2017

   $ 6,158,451

August 5, 2017

   $ 6,054,690

November 5, 2017

   $ 5,978,198

February 5, 2018

   $ 6,158,902

May 5, 2018

   $ 5,949,065

August 5, 2018

   $ 5,616,599

November 5, 2018

   $ 5,276,574

--------------------------------------------------------------------------------

Payment Date

   Minimum Amount

February 5, 2019

   $ 5,323,405

May 5, 2019

   $ 5,075,370

August 5, 2019

   $ 4,795,751

November 5, 2019

   $ 4,484,113

February 5, 2020

   $ 4,264,350

May 5, 2020

   $ 3,876,586

August 5, 2020

   $ 3,454,786

November 5, 2020

   $ 2,998,678

February 5, 2021

   $ 2,583,234

May 5, 2021

   $ 2,581,535

August 5, 2021

   $ 2,576,066

November 5, 2021

   $ 2,566,613

February 5, 2022

   $ 2,629,633

May 5, 2022

   $ 2,629,262

August 5, 2022

   $ 2,623,400

November 5, 2022

   $ 2,611,907

February 5, 2023

   $ 2,672,428

May 5, 2023

   $ 2,648,481

August 5, 2023

   $ 2,618,129

November 5, 2023

   $ 2,581,182

February 5, 2024

   $ 2,613,603

May 5, 2024

   $ 2,561,566

August 5, 2024

   $ 2,502,221

November 5, 2024

   $ 2,435,426

 

A-2

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Annex A

“See Annex A to the Note Purchase Agreement by and between Ledgemont Royalty Sub
LLC and the Company dated August 26, 2008, attached as Exhibit 10.215 to this
Annual Report on Form 10-K”.

--------------------------------------------------------------------------------

EXHIBIT A

FORM OF ORIGINAL CLASS A NOTE

[INSERT THE APPLICABLE LEGEND(S) SET FORTH IN SECTION 2.2]

LEDGEMONT ROYALTY SUB LLC

Ledgemont PhaRMASM Secured 16% Notes due 2024

Class A

 

No.                     

      CUSIP:                     

U.S. $105,000,000

LEDGEMONT ROYALTY SUB LLC, a limited liability company organized under the laws
of the State of Delaware (herein referred to as the “Issuer”), for value
received, hereby promises to pay to CEDE & CO., or registered assigns, the
principal amount set forth on Schedule I hereto on or before November 5, 2024
(the “Final Legal Maturity Date”) and to pay interest quarterly in arrears on
the Outstanding Principal Balance hereof at a rate per annum equal to 16% (the
“Stated Rate of Interest”), from the date hereof until the Outstanding Principal
Balance hereof is paid or duly provided for, which interest shall be due and
payable on each Payment Date; provided, that, with respect to any Payment Date
(other than the Final Legal Maturity Date or any Redemption Date), any such
interest in excess of the portion of the Available Collections Amount available
to pay such interest on such Payment Date and funds in the Interest Reserve
Account and the Capital Account (and available for interest payments pursuant to
Section 3.8 of the Indenture (as defined below)) shall be payable in full not
later than the immediately succeeding Payment Date (together with Additional
Interest on the amount of unpaid interest from the Payment Date on which it was
due until the date on which it is paid, compounded quarterly on each Payment
Date). Interest on this Note in each Interest Accrual Period shall be calculated
on the basis of a 360-day year consisting of twelve 30-day months on the
Outstanding Principal Balance of this Note. If this Note is issued in the form
of a Global Note, in accordance with the requirements of DTC, the Issuer will
cause the Trustee to authenticate an additional Note or additional Notes in the
appropriate principal amount such that neither this Note nor any other such Note
may exceed an aggregate principal amount of U.S.$500,000,000 at any time.

This Note is a duly authorized issue of Notes of the Issuer, designated as its
“Ledgemont PhaRMASM Secured 16% Notes due 2024”, issued under the Indenture
dated as of August 26, 2008 (as amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof, the
“Indenture”), by and between the Issuer and U.S. Bank National Association, as
trustee (including any successor appointed in accordance with the terms of the
Indenture, the “Trustee”). The Indenture also provides for the issuance of
Refinancing Notes and Class B Notes. All capitalized terms used in this Note and
not defined herein shall have the respective meanings assigned to such terms in
the Indenture. Reference is made to the Indenture and all indentures
supplemental thereto for a statement of the respective rights and obligations
thereunder of the Issuer, the Trustee and the Noteholders. This Note is subject
to all terms of the Indenture.

 

A-1

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The Issuer will pay the Outstanding Principal Balance of this Note on or prior
to the Final Legal Maturity Date on the Payment Dates specified in the
Indenture, subject to the availability of the Available Collections Amount
therefor after making payments entitled to priority under Section 3.7 of the
Indenture.

The indebtedness evidenced by the Original Class A Notes is, to the extent and
in the manner provided in the Indenture, senior in right of payment to the right
of payment of the Class B Notes, and this Note is issued subject to such
provisions. The maturity of this Note is subject to acceleration upon the
occurrence and during the continuance of the Events of Default specified in the
Indenture.

The Issuer may redeem all or part of the Outstanding Principal Balance of this
Note prior to the Final Legal Maturity Date on the Payment Dates, in the amounts
and under the circumstances specified in the Indenture.

Any amount of Premium or interest on this Note that is not paid when due shall,
to the fullest extent permitted by Applicable Law, bear interest (“Additional
Interest”) at an interest rate per annum equal to the Stated Rate of Interest
from the date when due until such amount is paid or duly provided for,
compounded quarterly and payable on the next succeeding Payment Date, subject to
the availability of the Available Collections Amount therefor (and, to the
extent provided in Section 3.8, the Interest Reserve Account and the Capital
Account) after making payments entitled to priority under Section 3.7 of the
Indenture.

This Note is and will be secured by the Collateral and the Issuer Pledged Equity
pledged as security therefor as provided in the Indenture and the Pledge and
Security Agreement, respectively.

Subject to and in accordance with the terms of the Indenture, there will be
distributed quarterly from the Collection Account on each Payment Date
commencing on November 5, 2008, to the Person in whose name this Note is
registered at the close of business on the Record Date with respect to such
Payment Date, in the manner specified in Section 3.7 of the Indenture, such
Person’s pro rata share (based on the aggregate percentage of the Outstanding
Principal Balance of the Original Class A Notes held by such Person) of the
aggregate amount distributable to all Noteholders of Original Class A Notes on
such Payment Date.

All amounts payable in respect of this Note shall be payable in U.S. dollars in
the manner provided in the Indenture to the Noteholder hereof on the Record Date
relating to such payment. The final payment with respect to this Note, however,
shall be made only upon presentation and surrender of this Note by the
Noteholder or its agent at an office or agency of the Trustee or Paying Agent in
New York City. At such time, if any, as this Note is issued in the form of one
or more Definitive Notes, payments on a Payment Date shall be made by check
mailed to each Noteholder of such a Definitive Note on the applicable Record
Date at its address appearing on the Register maintained with respect to the
Original Class A Notes or, alternatively, upon application in writing to the
Trustee or other Paying Agent, not later than the applicable Record

 

A-2

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Date, by a Noteholder, any such payments shall be made by wire transfer to an
account designated by such Noteholder at a financial institution in New York
City; provided, that, in each case, the final payment with respect to any such
Definitive Note shall be made only upon presentation and surrender of such
Definitive Note by the Noteholder or its agent at an office or agency of the
Trustee or Paying Agent in New York City. Notwithstanding the foregoing,
payments in respect of this Note issued in the form of a Global Note (including
principal, Premium, if any, and interest) shall be made by wire transfer of
immediately available funds to the account specified by DTC. Any reduction in
the Outstanding Principal Balance of this Note (or any one or more predecessor
Original Class A Notes) effected by any payments made on any Payment Date shall
be binding upon all future Noteholders of this Note and of any Original Class A
Note issued upon the registration of transfer of, in exchange or in lieu of or
upon the refinancing of this Note, whether or not noted hereon.

The Noteholder of this Note agrees, by acceptance hereof, to pay over to the
Trustee any money (including principal, Premium, if any, and interest) paid to
it in respect of this Note in the event that the Trustee, acting in good faith,
determines subsequently that such monies were not paid in accordance with the
priority of payment provisions of the Indenture or as a result of any other
mistake of fact or law on the part of the Trustee in making such payment.

This Note is issuable only in registered form. A Noteholder or Beneficial Holder
may transfer this Note or a Beneficial Interest herein only by delivery of a
written application to the Registrar stating the name of the proposed
transferee, a Confidentiality Agreement duly executed and delivered to the
Registrar by such transferee and otherwise complying with the terms of the
Indenture. No such transfer shall be effected until, and such transferee shall
succeed to the rights of a Noteholder only upon, final acceptance and
registration of the transfer by the Registrar in the Register. When this Note is
presented to the Registrar with a request to register the transfer or to
exchange it for an equal principal amount of Original Class A Notes of other
authorized denominations, the Registrar shall register the transfer or make the
exchange as requested if its requirements for such transactions are met
(including, in the case of a transfer, that such Note is duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and Registrar duly executed by the Noteholder thereof or by an attorney
who is authorized in writing to act on behalf of the Noteholder and that the
transferee has executed and delivered to the Registrar a Confidentiality
Agreement). No service charge shall be made for any registration of transfer or
exchange of this Note, but the party requesting such new Original Class A Note
or Original Class A Notes may be required to pay a sum sufficient to cover any
transfer Tax or similar governmental charge payable in connection therewith.

Prior to the registration of transfer of this Note, the Issuer and the Trustee
may deem and treat the Person in whose name this Note (as of the day of
determination or as of such other date as may be specified in the Indenture) is
registered as the absolute owner and Noteholder hereof for the purpose of
receiving payment of all amounts payable with respect to this Note and for all
other purposes, and neither the Issuer nor the Trustee shall be affected by
notice to the contrary.

Subject to Section 3.7(d) of the Indenture, the Indenture permits the amendment
or modification of the Indenture and the Original Class A Notes by the Issuer
with the consent of the Noteholders of a majority of the Outstanding Principal
Balance of all Notes (voting or acting as a single class). However, no amendment
or modification of the Indenture or the Original

 

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Class A Notes may, without the consent of Noteholders of 100% of the Outstanding
Principal Balance of the class of Notes affected thereby, (i) reduce the
percentage of Noteholders of any such class of Notes required to take or approve
any action under the Indenture, (ii) reduce the amount or change the time of
payment of any amount owing or payable with respect to any such class of Notes
(including pursuant to any Redemption) or change the rate of interest or change
the manner of calculation of interest payable with respect to any such class of
Notes, (iii) alter or modify the provisions with respect to the Collateral or
any Issuer Pledged Collateral for the Notes, the provisions of the Pledge and
Security Agreement with respect to the related Issuer Pledged Collateral for the
Notes or the manner of payment or the order of priorities in which payments or
distributions under the Indenture will be made as between the Noteholders of
such Notes and the Issuer or as among the Noteholders (including pursuant to
Section 3.7 of the Indenture), (iv) consent to any assignment of the Issuer’s
rights to a party other than the Trustee for the benefit of the Noteholders or
(v) alter the provisions relating to the Interest Reserve Account in a manner
adverse to any Noteholder. Any such amendment or modification shall be binding
on every Noteholder hereof, whether or not notation thereof is made upon this
Note.

The subordination provisions contained in Article X of the Indenture may not be
amended or modified without the consent of Noteholders of 100% of the
Outstanding Principal Balance of the class of Notes affected thereby. In no
event shall the provisions set forth in Section 3.7 of the Indenture relating to
the priority of payment of Expenses be amended or modified.

The Indenture also contains provisions permitting the Noteholders of a majority
of the Outstanding Principal Balance of the Senior Class of Notes, on behalf of
the Noteholders of all of the Original Class A Notes, to waive compliance by the
Issuer with certain provisions of the Indenture and certain past defaults under
the Indenture and their consequences. Any such consent or waiver shall be
conclusive and binding upon all present and future Noteholders of this Note and
of any Original Class A Note issued upon the registration of transfer of, in
exchange or in lieu of or upon the refinancing of this Note, whether or not
notation of such consent or waiver is made upon this Note.

The Original Class A Notes are issuable only in registered form in denominations
as provided in the Indenture, subject to certain limitations therein set forth.

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
SUBSTANTIVE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE RULES THEREOF
RELATING TO CONFLICTS OF LAW OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

The enforceability against the Issuer of the obligations of the Issuer under the
Indenture and under the Notes shall be limited to the assets of the Issuer,
whether tangible or intangible, real or personal (including the Collateral) and
the proceeds thereof. Once all such assets have been realized upon and such
assets (and proceeds thereof) have been applied in accordance with Article III
of the Indenture, any outstanding obligations of the Issuer shall be
extinguished. Each of the parties to the Indenture shall take no action against
any employee, director, officer or

 

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administrator of the Issuer, an Equityholder or the Trustee in relation to the
Indenture; provided, that nothing therein shall limit the Issuer (or its
permitted successors or assigns, including any party thereto that becomes such a
successor or assign) from pursuing claims, if any, against any such Person. The
provisions of Section 12.14 of the Indenture shall survive termination of the
Indenture; provided, further, that the foregoing shall not in any way limit,
impair or otherwise affect any rights of the Trustee or the Noteholders to
proceed against any such Person (a) for intentional and willful fraud or
intentional and willful misrepresentations on the part of or by such Person or
(b) for the receipt of any distributions or payments to which the Issuer or any
successor in interest is entitled, other than distributions expressly permitted
pursuant to the Indenture and the other Deal Documents.

Unless the certificate of authentication hereon has been executed by the Trustee
whose name appears below by manual or facsimile signature, this Note shall not
be entitled to any benefit under the Indenture, or be valid or obligatory for
any purpose.

 

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IN WITNESS WHEREOF, the Issuer has caused this Note to be signed manually or by
facsimile by its duly authorized Manager.

 

Date: August 26, 2008     LEDGEMONT ROYALTY SUB LLC     By:   Indevus
Pharmaceuticals, Inc., its Manager       By:             Name:           Title:
 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This Note is one of the Ledgemont PhaRMASM Secured 16% Notes due 2024 designated
above and referred to in the within-mentioned indenture.

 

Date: August 26, 2008    

U.S. BANK NATIONAL ASSOCIATION,

    as Trustee

      By:             Authorized Signatory

 

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FORM OF TRANSFER NOTICE

FOR VALUE RECEIVED the undersigned registered holder hereby sell(s), assign(s)
and transfer(s) unto

Insert Taxpayer Identification No.                                          
           

 

 

(Please print or typewrite name and address including zip code of assignee)

the within Note and all rights thereunder, hereby irrevocably constituting and
appointing                                                                      
attorney to transfer said Note on the books of the Issuer with full power of
substitution in the premises.

 

          Date     Signature of Transferor

NOTE: The signature to this assignment must correspond with the name as written
upon the face of the within-mentioned instrument in every particular, without
alteration or any change whatsoever.

[THE FOLLOWING PROVISIONS TO BE INCLUDED ON ALL NOTES]

In connection with any transfer of the within-mentioned Note, the undersigned
confirms without utilizing any general solicitation or general advertising that:

[Check One]

__(a) the within-mentioned Note is being transferred in compliance with the
exemption from registration under the Securities Act provided by Rule 144A
thereunder

__(b) the within-mentioned Note is being transferred other than in accordance
with clause (a) above and documents are being furnished that comply with the
conditions of transfer set forth in the within-mentioned Note and the Indenture

If neither of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register the within-mentioned Note in the name of any
Person other than the Noteholder hereof unless and until the conditions to any
such transfer of registration set forth herein and in Section 2.11 of the
Indenture shall have been satisfied.

 

          Date     NOTICE: The signature to this assignment must correspond with
the name as written upon the face of the within-mentioned instrument in every
particular, without alteration or any change whatsoever.

 

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TO BE COMPLETED BY PURCHASER IF CLAUSE (a) ABOVE IS CHECKED.

The undersigned represents and warrants that it is purchasing the
within-mentioned Note for its own account or an account with respect to which it
exercises sole investment discretion and that each of it and any such account is
a “qualified institutional buyer” within the meaning of Rule 144A and is aware
that the sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Issuer as the undersigned has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon the
undersigned’s foregoing representations in order to claim the exemption from
registration provided by Rule 144A and has executed and delivered to the
Registrar a Confidentiality Agreement.

Dated:                     

 

   Executive Officer

 

A-8

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SCHEDULE I

LEDGEMONT ROYALTY SUB LLC

Ledgemont PhaRMASM Secured 16% Notes due 2024

No.             

 

Date

 

Principal Amount   Notation Explaining
Principal Amount
Recorded   Authorized Signature
of Trustee or
Custodian                        

 

A-9

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EXHIBIT B

FORM OF RESALE CONFIDENTIALITY UNDERTAKING

No.             

Ledgemont Royalty Sub LLC

c/o Indevus Pharmaceuticals, Inc.

33 Hayden Avenue

Lexington, MA 02421-7996

Attention: Mark S. Butler, General Counsel

                    , 20__

RESALE CONFIDENTIALITY UNDERTAKING

In connection with our possible interest in the purchase of the Ledgemont
PhaRMASM Secured 16% Notes due 2024 (the “Notes”) issued by Ledgemont Royalty
Sub LLC, a Delaware limited liability company (the “Company”) (the
“Transaction”), we have requested that you or your directors, officers,
managers, members, partners, employees, affiliates, assigns, representatives
(including, without limitation, financial advisors, attorneys and accountants),
investors, agents or similar persons (collectively, “your Representatives”)
furnish us or our directors, officers, managers, members, partners, employees,
affiliates, assigns, representatives (including, without limitation, financial
advisors, attorneys and accountants), investors, agents or similar persons
(collectively, “our Representatives”) with certain Confidential Information (as
defined in the Indenture described below) and with certain other information
relating to the Company, the Transaction and the rights acquired by the Company
from Indevus Pharmaceuticals, Inc., a Delaware corporation (“Indevus”). All such
information (whether written or oral, and whether tangible or electronic,
including the Information Memorandum described below) furnished on or after the
date hereof by you or your Representatives to us or our Representatives and any
materials containing, based on or derived from any such information (including,
without limitation, any financial models or other analyses, compilations,
forecasts, studies or other documents based thereon) prepared by us or our
Representatives in connection with our or our Representatives’ review of, or our
interest in, the Transaction is hereinafter referred to as the “Information”.
The term Information will not, however, include information that (i) is already
known by us at the time such information is disclosed unless such information
was disclosed to us under a confidentiality agreement with you that was entered
into in connection with our earlier consideration of the Notes, (ii) is or
thereafter becomes available in the public domain, other than by breach by us or
our Representatives of our obligations hereunder, (iii) is obtainable by us from
another source without, to our knowledge, breach of such source’s obligations of
confidentiality to you or (iv) is independently developed by our Representatives
who have not had access to such information.

As a condition to receiving the Information, we hereby agree as follows:

1. We and our Representatives hereby agree (i) to keep the Information
confidential, (ii) that the Information will be used solely for the purpose of
evaluating, entering into, monitoring or enforcing the Transaction and (iii) not
to, without your prior written consent,

 

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disclose any Information in any manner whatsoever; provided, however, that we
may reveal the Information to (a) our Representatives who need to know the
Information for the purpose of evaluating, entering into, monitoring or
enforcing the Transaction or (b) third parties in order to comply with any
applicable law, rule, regulation or legal process or pursuant to requests of
governmental authorities or regulatory agencies having oversight over us or our
Representatives, and only after compliance with paragraph 3 below, provided,
that all of such persons listed in clause (a) above shall agree in writing to
keep such information confidential, and only to use such information, on
reasonable and customary terms that are substantially the same as the terms we
are subject to, and, provided, further, that we shall be wholly responsible for
the full compliance of such confidentiality agreement or confidentiality
undertaking by any of the persons listed in clause (a) above to which we
disclosed Information. Notwithstanding and without limitation of the foregoing,
we and our Representatives agree not to reveal Information to advisors who are
principally engaged in the business of investment banking, capital markets or
securitization of financial assets without the prior written consent of your
Representative, Morgan Stanley & Co. Incorporated (“Morgan Stanley”).

2. We and our Representatives agree, whether or not the Transaction is
consummated, not to (except as required by applicable law, rule, regulation or
legal process or pursuant to requests of governmental authorities or regulatory
agencies having oversight over us or our Representatives, and only after
compliance with paragraph 3 below), without your prior written consent, disclose
to any person the fact that the Information or the Transaction exists or has
been made available, that we are considering the Transaction, or that
discussions or negotiations are taking or have taken place concerning the
Transaction or any term, condition or other fact relating to the Transaction or
such discussions or negotiations, including, without limitation, the status
thereof.

3. In the event that we or any of our Representatives are required by applicable
law, rule, regulation or legal process or pursuant to requests of governmental
authorities or regulatory agencies having oversight over us or our
Representatives to disclose any of the Information, we agree to use commercially
reasonable efforts to notify you promptly (unless such notice is not permitted
by applicable law, rule or regulation) so that you may seek, at your own
expense, a protective order or other appropriate remedy or, in your sole
discretion, waive compliance with the terms of this Resale Confidentiality
Undertaking. In the event that no such protective order or other remedy is
obtained, or that you do not waive compliance with the terms of this Resale
Confidentiality Undertaking, we agree to furnish only that portion of the
Information that we are advised by counsel (which may be internal counsel) is
legally required and will exercise all commercially reasonable efforts to obtain
reliable assurance that confidential treatment will be accorded the Information.

4. If we determine not to proceed with the Transaction or we cease to have an
interest arising from the Transaction, we will promptly inform you of that
decision or event and, in that case, and at any time upon your request or the
request of any of your Representatives, we and our Representatives agree to
(i) promptly deliver to you all copies of the Information in our possession
(except as described in the following proviso), (ii) promptly destroy all copies
of any written Information (whether in tangible or electronic form, or
otherwise) that we and our Representatives have created, including, without
limitation, any notes we have taken on any discussions with you or your
Representatives, and upon your request such destruction shall be

 

B-2

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certified in writing (including, without limitation, via email) to you by an
authorized officer supervising such destruction (provided in each case that an
appropriate person within our organization may retain one copy of the
Information, subject to the provisions of this Resale Confidentiality
Undertaking, if required to comply with internal record retention policies or
regulatory considerations, in which case, regardless of paragraph 14 below, the
confidentiality provisions of this Resale Confidentiality Undertaking will
continue to apply to such Information for so long as it is retained by such
person or any other of our Representatives) and (iii) certify that clauses
(i) and (ii) above have been complied with. Any oral Information will continue
to be subject to the terms of this Resale Confidentiality Undertaking.

5. We acknowledge that you have not updated, and have no obligation to update,
the Confidential Information Memorandum dated August 21, 2008 (the “Information
Memorandum”) in any respect for events, developments or circumstances
(including, without limitation, the level of royalty payments for SANCTURA® or
SANCTURA XRTM or the sales of SANCTURA® or SANCTURA XRTM compared to the sales
forecasts contained therein). We further acknowledge that neither you nor any of
your Representatives, nor any of your or their respective officers, directors,
managers, members, partners, employees, agents or controlling persons within the
meaning of Section 20 of the Securities Exchange Act of 1934, as amended, makes
any express or implied representation or warranty as to the accuracy or
completeness of the Information, and we agree that no such person will have any
liability relating to the Information or for any errors therein or omissions
therefrom. We further agree that we are not entitled to rely on the accuracy or
completeness of the Information.

6. We acknowledge that we are aware of the restrictions imposed by the United
States securities laws on the purchase or sale of securities of an issuer or an
affiliate or controlling person of the issuer while in possession of material,
non-public information and on the communication of such information to any other
person. We represent that we maintain effective internal procedures with respect
to maintaining the confidentiality and use of the Information and that we will
not use the Information for any purpose in violation of United States securities
laws or any other applicable laws. We further represent that we are a qualified
institutional buyer (as defined in Rule 144A under the Securities Act of 1933,
as amended) or an institutional accredited investor (as defined in subparagraph
(a) (1), (2), (3) or (7) of Rule 501 under the Securities Act of 1933, as
amended).

7. We represent and warrant that (i) we are not, and will not become, a
partnership, Subchapter S corporation or grantor trust for U.S. federal income
tax purposes or (ii) we are or may become a partnership, Subchapter S
corporation or grantor trust for U.S. federal income tax purposes but (A) none
of the direct or indirect beneficial owners of any of our interests have allowed
or caused, or will allow or cause, 50% or more of the value of such interests to
be attributable to the ownership of Notes plus the ownership, if any, of equity
of the Company or (B) such partnership, Subchapter S corporation or grantor
trust was not formed with a principal purpose of permitting the Company to
satisfy the 100-partner limitation in Treasury Regulation
Section 1.7704-1(h)(1)(ii).

8. We acknowledge that remedies at law may be inadequate to protect you against
any actual or threatened breach of this Resale Confidentiality Undertaking by us
or our Representatives, and, without prejudice to any other rights and remedies
otherwise available to you, we agree to permit you to seek the granting of
injunctive relief in your favor without proof of actual damages.

 

B-3

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9. We acknowledge and agree that each of Indevus, Allergan USA, Inc., Supernus
Pharmaceuticals, Inc., Madaus GmbH and Morgan Stanley is a third party
beneficiary of this Resale Confidentiality Undertaking and shall have the right
to enforce any provision of this Resale Confidentiality Undertaking.

10. We agree that no failure or delay by you in exercising any right, power or
privilege hereunder will operate as a waiver thereof, nor will any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any right, power or privilege hereunder.

11. This Resale Confidentiality Undertaking shall be binding upon and inure to
the benefit of you and us and your and our respective successors and assigns.

12. This Resale Confidentiality Undertaking shall be governed by, and construed,
interpreted and enforced in accordance with, the laws of the State of New York,
without giving effect to the principles of conflicts of law thereof (other than
the provisions of Section 5-1401 of the General Obligations Law of the State of
New York).

13. This Resale Confidentiality Undertaking contains the entire agreement
between you and us concerning the confidentiality of the Information, and no
modifications of this Resale Confidentiality Undertaking or waiver of the terms
and conditions hereof will be binding upon you or us, unless approved in writing
by each of you and us.

14. This Resale Confidentiality Undertaking will terminate (i) if we do not
proceed with the Transaction, 24 months after the date hereof, and (ii) if we do
proceed with the Transaction, 24 months from the date we cease to have an
interest arising from the Transaction, whether through a sale of our interest,
the maturity or repayment of our interest or otherwise.

15. If we propose to transfer, sell or otherwise dispose of any of our interest
at any time, we agree to (i) abide by any transfer restrictions described in the
Indenture dated as of August 26, 2008 (the “Indenture”) made by and between you
and U.S. Bank National Association, as trustee, (ii) inform any proposed
transferee of such interest of any such transfer restrictions, including,
without limitation, any requirement that such proposed transferee execute a
resale confidentiality undertaking, and (iii) not furnish any Information to
such proposed transferee. We acknowledge that you or any other servicer for the
Transaction shall be responsible for the delivery of all Information to any such
prospective transferee following execution by such prospective transferee of an
appropriate resale confidentiality undertaking.

16. We represent and warrant that we are not a company that sells or has
announced that it has products under development that compete with Botox or
trospium-based products of Allergan USA, Inc.

17. This Resale Confidentiality Undertaking may be executed by facsimile
signature and such facsimile signature shall be deemed an original.

 

B-4

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In accordance with Section 2.11(j) of the Indenture, we will provide a fully
executed copy of this Resale Confidentiality Undertaking to the Registrar (as
defined in the Indenture) promptly after executing this Resale Confidentiality
Undertaking.

 

Very truly yours,   [Please insert prospective purchaser’s name on line above]
By:       Name:   Title:   Address:

 

B-5

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EXHIBIT C

AGENTS FOR SERVICE OF PROCESS

 

Party

 

Jurisdiction

 

Appointed Agent

Ledgemont Royalty Sub LLC

  Delaware   Corporation Service Company

 

C-1

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EXHIBIT D

COVERAGE OF DISTRIBUTION REPORT

 

(i) With respect to the current Payment Date, (A) the balances on deposit in the
Collection Account and any other Account established under the Indenture on the
Calculation Date immediately preceding the prior Payment Date (or, with respect
to the first Payment Date, on the Closing Date) (the “Preceding Calculation
Date”), (B) the aggregate amounts of deposits into and withdrawals from the
Collection Account and any other Account established under the Indenture from
but excluding the Preceding Calculation Date to and including the Calculation
Date immediately preceding the Payment Date (the “Current Calculation Date”) and
(C) the balances on deposit in the Collection Account and any other Account
established under the Indenture on the Current Calculation Date.

 

(ii) Analysis of Collection Account activity from the Preceding Calculation Date
to the Current Calculation Date

Balance on the Preceding Calculation Date

Collections from but excluding the Preceding Calculation Date to and including
the Current Calculation Date (“Current Collections”)

Aggregate Note payments from but excluding the Preceding Calculation Date to and
including the Current Calculation Date, including pursuant to Section 2.5(e)

Expense payments payable on the Current Calculation Date (“Current Expenses”)

Tax Distribution payments payable on the Current Calculation Date (“Current Tax
Distributions”), including a schedule supporting the calculation of such Current
Tax Distributions

Payments to be made to the Tax Distribution Escrow Account on the current
Payment Date

Balance on the Current Calculation Date

 

(iii) Amount, if any, to be transferred from the Interest Reserve Account to the
Collection Account on the current Payment Date

 

(iv) Payments on the current Payment Date

Current Expenses

Interest Amount

Additional Interest, if any

Current Tax Distributions

Payments to the Tax Distribution Escrow Account, if any

Principal payments, if any

 

(v) Outstanding Principal Balance

Opening Outstanding Principal Balance

Principal payments, if any, made on the current Payment Date

Closing Outstanding Principal Balance

 

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(vi) Amount distributed to the Issuer from the Collection Account, if any, with
respect to the current Payment Date

 

(vii) Any amounts distributed from the Tax Distribution Escrow Account to the
Equityholders since the Preceding Calculation Date

 

(viii) A withholding obligation may be included

 

(ix) Appropriate modifications will be made to contemplate any Refinancing Notes
and/or Class B Notes

 

D-2

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EXHIBIT E

UCC FINANCING STATEMENTS

 

1. A Form UCC-1 Financing Statement will be filed with the Secretary of State of
the State of Delaware naming the Issuer as debtor and the Trustee as secured
party.

 

E-1

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EXHIBIT F

FORM OF CERTIFICATE OF EUROCLEAR OR CLEARSTREAM FOR

PERMANENT REGULATION S GLOBAL NOTE

                    , 20__

U.S. Bank National Association,

    as Trustee

One Federal Street, 3rd Floor

Boston, Massachusetts 02110

Attention: Corporate Trust Services (Ledgemont Royalty Sub LLC)

Ledgemont Royalty Sub LLC

c/o Indevus Pharmaceuticals, Inc.

33 Hayden Avenue

Lexington, MA 02421-7996

Attention: Mark S. Butler, General Counsel

 

  Re: Ledgemont Royalty Sub LLC (the “Issuer”)

Ladies and Gentlemen:

This letter relates to U.S.$                     principal amount of Ledgemont
PhaRMASM Secured 16% Notes due 2024 of the Issuer (the “Notes”) represented by a
Note that bears a legend (the “Legended Note”) outlining restrictions upon
transfer of such Legended Note. Pursuant to Section 2.1 of the Indenture dated
as of August 26, 2008 (the “Indenture”) relating to the Notes and certain other
classes of notes of the Issuer, we hereby certify that we are (or we will hold
such securities on behalf of) an Institutional Accredited Investor (as defined
in the Indenture) outside the United States to whom the Notes may be transferred
in accordance with Rule 904 of Regulation S promulgated under the U.S.
Securities Act of 1933, as amended (“Regulation S”). Accordingly, you are hereby
requested to exchange the Legended Note for a Permanent Regulation S Global Note
(as defined in the Indenture) representing an identical principal amount of
Notes, all in the manner provided for in the Indenture.

Each of you is entitled to rely upon this letter and is irrevocably authorized
to produce this letter or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby. Certain terms used in this certificate have the meanings
set forth in Regulation S.

 

Very truly yours, [Euroclear Bank S.A./N.V.][Clearstream Banking] By:      
Authorized Signatory

 

F-1

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EXHIBIT G

FORM OF CERTIFICATE OF BENEFICIAL OWNER OF TEMPORARY

REGULATION S GLOBAL NOTE

Euroclear Bank S.A./N.V.

[Address]

AND/OR

Clearstream Banking

[Address]

 

  Re: Ledgemont Royalty Sub LLC (the “Issuer”)

Reference is hereby made to the Indenture, dated as of August 26, 2008 (the
“Indenture”), made by and between the Issuer and U.S. Bank National Association,
as trustee (the “Trustee”). Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.

This letter relates to U.S.$                     principal amount of Ledgemont
PhaRMASM Secured 16% Notes due 2024 that are held in the form of a Beneficial
Interest in the Temporary Regulation S Global Note (CUSIP No.
                    ) through DTC by the undersigned (the “Holder”) in the name
of                     . The Holder of such Temporary Regulation S Global Note
hereby requests the receipt of payments due and payable [on the applicable
Payment Date] pursuant to Section 2.5 of the Indenture.

The Holder hereby represents and warrants that it (i) is an Institutional
Accredited Investor, (ii) is not a U.S. Person, (iii) does not hold the
above-referenced Temporary Regulation S Global Note for the account or benefit
of a U.S. Person (other than a distributor) and (iv) has executed and delivered
to the Registrar a Confidentiality Agreement. Certain terms in this certificate
not otherwise defined in the Indenture have the meanings given to them in
Regulation S.

This certificate and the statements contained herein are made for your benefit
and the benefit of the Paying Agent.

 

[Name of Holder] By:       Name:   Title:

 

G-1

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EXHIBIT H

FORM OF CERTIFICATE OF EUROCLEAR OR CLEARSTREAM FOR PAYMENTS

U.S. Bank National Association,

    as Paying Agent

One Federal Street, 3rd Floor

Boston, Massachusetts 02110

Attention: Corporate Trust Services (Ledgemont Royalty Sub LLC)

 

  Re: Ledgemont Royalty Sub LLC (the “Issuer”)

Reference is hereby made to the Indenture, dated as of August 26, 2008 (the
“Indenture”), made by and between the Issuer and U.S. Bank National Association,
as trustee (the “Trustee”). Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.

This letter relates to U.S.$                     principal amount of Ledgemont
PhaRMASM Secured 16% Notes due 2024 that are held in the form of a Beneficial
Interest in the Temporary Regulation S Global Note (CUSIP No.
                    ) through DTC by the undersigned (the “Holder”) in the name
of                     . Certain Holders of the Beneficial Interests in such
Temporary Regulation S Global Note have requested the receipt of payments due
and payable [on the applicable Payment Date] pursuant to Section 2.5 of the
Indenture.

We have received from such Holders certifications to the effect that they
(i) are Institutional Accredited Investors, (ii) are not U.S. Persons, (iii) do
not hold the above-referenced Temporary Regulation S Global Note for the account
or benefit of U.S. Persons (other than distributors) and (iv) have executed and
delivered to the Registrar a Confidentiality Agreement. Certain terms in this
certificate not otherwise defined in the Indenture have the meanings given to
them in Regulation S.

Accordingly, the Holders of the Beneficial Interests in the Temporary Regulation
S Global Note are entitled to receive interest, principal and Premium, if any,
in accordance with the terms of the Indenture in the amount of
U.S.$                    .

 

[Clearstream Banking][Euroclear Bank S.A./N.V.] By:       Name:   Title:

 

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EXHIBIT I

FORM OF CERTIFICATE OF PROPOSED TRANSFEROR

                    , 20__

U.S. Bank National Association,

    as Registrar One Federal Street, 3rd Floor

Boston, Massachusetts 02110

Attention: Corporate Trust Services (Ledgemont Royalty Sub LLC)

Ledgemont Royalty Sub LLC

c/o Indevus Pharmaceuticals, Inc.

33 Hayden Avenue

Lexington, MA 02421-7996

Attention: Mark S. Butler, General Counsel

 

  Re: Ledgemont Royalty Sub LLC (the “Issuer”)

Ladies and Gentlemen:

In connection with our proposed sale of U.S.$                     aggregate
principal amount of Ledgemont PhaRMASM Secured 16% Notes due 2024 of the Issuer
(the “Notes”), we confirm that such sale has been effected pursuant to and in
accordance with Regulation S under the U.S. Securities Act of 1933, as amended
(“Regulation S”) and, accordingly, we represent that:

(1) the offer of the Notes was not made to a person in the U.S.;

(2) at the time the buy order was originated, the transferee was an
institutional accredited investor (as defined in subparagraph (a) (1), (2),
(3) or (7) of Rule 501 under the U.S. Securities Act of 1933, as amended)
outside the U.S. or we and any person acting on our behalf reasonably believed
that the transferee was an institutional accredited investor outside the U.S.;

(3) no directed selling efforts have been made by us in the U.S. in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable;

(4) the transaction is not part of a plan or scheme to evade the registration
requirements of the U.S. Securities Act of 1933; and

(5) the transferee has entered into the confidentiality undertaking required in
connection with the purchase of the Notes.

Each of you is entitled to rely upon this letter and is irrevocably authorized
to produce this letter or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby. Certain terms used in this certificate have the meanings
set forth in Regulation S.

 

Very truly yours, [Name of Transferor] By:       Authorized Signatory

 

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EXHIBIT J

FORM OF CERTIFICATE OF CERTAIN PROPOSED INSTITUTIONAL

ACCREDITED INVESTOR TRANSFEREES

                    , 20__

U.S. Bank National Association,

    as Registrar

One Federal Street, 3rd Floor

Boston, Massachusetts 02110

Attention: Corporate Trust Services (Ledgemont Royalty Sub LLC)

Ledgemont Royalty Sub LLC

c/o Indevus Pharmaceuticals, Inc.

33 Hayden Avenue

Lexington, MA 02421-7996

Attention: Mark S. Butler, General Counsel

Ladies and Gentlemen:

In connection with our proposed purchase of Notes (the “Notes”) of Ledgemont
Royalty Sub LLC (the “Issuer”), we confirm that:

1. We have duly executed and delivered to the Registrar (as defined in that
certain Indenture dated as of August 26, 2008 (the “Indenture”) by and between
the Issuer and U.S. Bank National Association, as trustee, as amended, restated,
supplemented or otherwise modified from time to time in accordance with the
terms thereof) a Resale Confidentiality Undertaking and have subsequently
received such information as we deem necessary in order to make our investment
decision. We acknowledge that we have read and agreed to the matters stated in
Article II of the Indenture.

2. We understand that any subsequent transfer of the Notes is subject to certain
restrictions and conditions set forth under Article II of the Indenture and the
undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Notes except in compliance with, such restrictions and conditions
and the U.S. Securities Act of 1933, as amended (the “Securities Act”).

3. We understand that the offer and sale of the Notes have not been registered
under the Securities Act, that the Notes will only be in the form of definitive
physical certificates and that the Notes may not be offered or sold except as
permitted in the following sentence. We agree, on our own behalf and on behalf
of any accounts for which we are acting as hereinafter stated, that, if we
should sell any Notes in the future, we will do so only (1) (A) to the Issuer or
any subsidiary thereof, (B) in accordance with Rule 144A under the Securities
Act to a qualified institutional buyer (as defined therein), (C) to an
institutional accredited investor (as defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Securities Act) (“Institutional Accredited
Investor”) that, prior to such transfer, furnishes to the Trustee (as defined in
the Indenture) a signed letter containing certain representations and agreements
relating to the

 

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restrictions on transfer of the Notes (the form of which letter can be obtained
from the Trustee) and an opinion of counsel acceptable to the Issuer that such
transfer is in compliance with the Securities Act, (D) to an Institutional
Accredited Investor in an offshore transaction in compliance with Rule 904 of
Regulation S under the Securities Act or (E) to an Institutional Accredited
Investor after the relevant time period referred to in Rule 144 under the
Securities Act expires, and we further agree to provide to any entity purchasing
any of the Notes from us a notice advising such purchaser that resales of the
Notes are restricted as stated herein and (2) in each case, in accordance with
any applicable securities laws of any state in the U.S. or any other applicable
jurisdiction and in accordance with the legend to be set forth in the Notes,
which will reflect the substance of this paragraph.

4. We understand that, on any proposed resale of any Notes, we will be required
to furnish to the Issuer and the Trustee such certifications, legal opinions and
other information as the Issuer and the Trustee may reasonably require to
confirm that the proposed sale complies with the foregoing restrictions. We
further understand that a resale confidentiality undertaking is required under
the Indenture to be executed and delivered by any proposed transferee to whom we
wish to sell any Notes.

5. We are an Institutional Accredited Investor and have such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of our investment in the Notes, and we and any accounts for
which we are acting are able to bear the economic risks of our or their
investment.

6. We are acquiring the Notes purchased by us for our own account or for one or
more accounts (each of which is an Institutional Accredited Investor) as to each
of which we exercise sole investment discretion.

7. We are not acquiring the Notes with a view to distribution thereof or with
any present intention of offering or selling the Notes, except as permitted
above, provided that the disposition of our property and property of any
accounts for which we are acting as fiduciary shall remain at all times within
our control.

You, the Issuer and the Trustee are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.

 

Very truly yours, By:       Name:   Title

 

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EXHIBIT K

FORM OF PORTFOLIO INTEREST CERTIFICATE

                                       
                                                       hereby certifies that:

 

1. It is (one must be checked):

 

  (1)              a natural individual person;

 

  (2)              treated as a corporation for U.S. federal income tax
purposes;

 

  (3)              disregarded for U.S. federal income tax purposes (in which
case a copy of this certificate is completed and signed by its sole beneficial
owner); or

 

  (4)              treated as a partnership for U.S. federal income tax purposes
(in which case each partner also has completed as to itself and signed a copy of
this certificate and an appropriate IRS Form W-8, a copy of each of which is
attached, or, if applicable, has completed as to itself and signed an IRS Form
W-9, a copy of which is attached).

 

2. It is not a bank, as such term is used in Section 881(c)(3)(A) of the
Internal Revenue Code of 1986, as amended (the “Code”).

 

3. It is not a 10-percent shareholder of Ledgemont Royalty Sub LLC (the
“Issuer”) or Indevus Pharmaceuticals, Inc. (the “Equityholder”) within the
meaning of Section 871(h)(3) of the Code or Section 881(c)(3)(B) of the Code.

 

4. It is not a controlled foreign corporation that is related to the Issuer or
the Equityholder within the meaning of Section 881(c)(3)(C) of the Code.

 

5.

Amounts received by it on the Ledgemont PhaRMASM Secured 16% Notes due 2024 are
not effectively connected with its conduct of a trade or business in the United
States.

 

  [Fill in name of holder] By:       Name:   Title:   Date:

 

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