Document:

Exhibit 10.2

THIS DISCLOSURE   STATEMENT IS BEING SUBMITTED FOR APPROVAL TO, BUT HAS NOT BEEN APPROVED BY,   THE BANKRUPTCY COURT. THIS IS NOT A SOLICITATION OF ACCEPTANCES OR REJECTIONS   OF THE PLAN. ACCEPTANCES OR REJECTIONS OF THE PLAN MAY NOT BE SOLICITED UNTIL   A DISCLOSURE STATEMENT HAS BEEN APPROVED BY THE BANKRUPTCY COURT. UNITED   STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK   -------------------------------------------------------x In re : : : : :   Chapter 11 Aegerion Pharmaceuticals, Inc., et al.,1 Case No. 19-11632 (MG)   Debtors. (Jointly Administered)   -------------------------------------------------------x DISCLOSURE STATEMENT   FOR DEBTORS’ FIRST AMENDED JOINT CHAPTER 11 PLAN Dated: New York, New York   July [ ], 2019 WILLKIE FARR & GALLAGHER LLP 787 Seventh Avenue New York,   New York 10019 (212) 728-8000 Counsel for the Debtors and Debtors in   Possession 1 The Debtors in these chapter 11 cases and the last four digits   of each Debtor’s federal taxpayer identification number are Aegerion   Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc.   (1331). The Debtors’ executive headquarters are located at 245 First Street,   Riverview II, 18th Floor, Cambridge, MA 02142. 

    

 

IMPORTANT   NOTICE THIS DISCLOSURE STATEMENT AND ITS RELATED DOCUMENTS ARE THE ONLY   DOCUMENTS AUTHORIZED BY THE BANKRUPTCY COURT TO BE USED IN CONNECTION WITH   THE SOLICITATION OF VOTES TO ACCEPT THE JOINT CHAPTER 11 PLAN OF   REORGANIZATION FOR AEGERION PHARMACEUTICALS, INC. AND AEGERION   PHARMACEUTICALS HOLDINGS, INC. (THE “PLAN”). NO REPRESENTATIONS HAVE BEEN   AUTHORIZED BY THE BANKRUPTCY COURT CONCERNING THE DEBTORS, THEIR BUSINESS   OPERATIONS OR THE VALUE OF THEIR ASSETS, EXCEPT AS EXPLICITLY SET FORTH IN   THIS DISCLOSURE STATEMENT. THE DEBTORS URGE YOU TO READ THIS DISCLOSURE   STATEMENT CAREFULLY FOR A DISCUSSION OF VOTING INSTRUCTIONS, RECOVERY   INFORMATION, CLASSIFICATION OF CLAIMS, THE HISTORY OF THE DEBTORS AND THE   CHAPTER 11 CASES, THE DEBTORS’ BUSINESSES, PROPERTIES AND RESULTS OF   OPERATIONS, HISTORICAL AND PROJECTED FINANCIAL RESULTS AND A SUMMARY AND   ANALYSIS OF THE PLAN. ALL CAPITALIZED TERMS IN THIS DISCLOSURE STATEMENT NOT   OTHERWISE DEFINED HEREIN HAVE THE MEANINGS GIVEN TO THEM IN THE PLAN, A COPY   OF WHICH IS ATTACHED TO THIS DISCLOSURE STATEMENT AS EXHIBIT 1. INFORMATION   CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. THE DEBTORS RESERVE   THE RIGHT, SUBJECT TO THE PARTIES’ RIGHTS UNDER THE RSA AND THE PLAN FUNDING   AGREEMENT, TO FILE AN AMENDED PLAN AND RELATED DISCLOSURE STATEMENT FROM TIME   TO TIME. THIS DISCLOSURE STATEMENT SHALL NOT CONSTITUTE AN OFFER TO SELL, OR   THE SOLICITATION OF AN OFFER TO BUY, NOR WILL THERE BE ANY DISTRIBUTION OF   ANY OF THE SECURITIES DESCRIBED HEREIN UNTIL THE EFFECTIVE DATE OF THE PLAN.   THIS DISCLOSURE STATEMENT HAS BEEN PREPARED IN ACCORDANCE WITH SECTION 1125   OF THE BANKRUPTCY CODE AND RULE 3016(C) OF THE FEDERAL RULES OF BANKRUPTCY   PROCEDURE. THE PLAN AND THIS DISCLOSURE STATEMENT WERE NOT REQUIRED TO BE   PREPARED IN ACCORDANCE WITH FEDERAL OR STATE SECURITIES LAWS OR OTHER APPLICABLE   NONBANKRUPTCY LAW. DISSEMINATION OF THIS DISCLOSURE STATEMENT IS CONTROLLED   BY BANKRUPTCY RULE 3017. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL   OFFENSE. THIS DISCLOSURE STATEMENT WAS PREPARED TO PROVIDE PARTIES IN   INTEREST IN THESE CASES WITH “ADEQUATE INFORMATION” (AS DEFINED IN SECTION   1125 OF THE BANKRUPTCY CODE) SO THAT THOSE CREDITORS WHO ARE ENTITLED TO VOTE   WITH RESPECT TO THE PLAN CAN MAKE AN INFORMED JUDGMENT REGARDING SUCH VOTE ON   THE PLAN. i 

    

 

THIS DISCLOSURE   STATEMENT CONTAINS ONLY A SUMMARY OF THE PLAN. THIS DISCLOSURE STATEMENT IS   NOT INTENDED TO REPLACE A CAREFUL AND DETAILED REVIEW AND ANALYSIS OF THE   PLAN; RATHER THIS DISCLOSURE STATEMENT IS INTENDED ONLY TO AID AND SUPPLEMENT   SUCH REVIEW. THIS DISCLOSURE STATEMENT IS QUALIFIED IN ITS ENTIRETY BY   REFERENCE TO THE PLAN, THE PLAN SUPPLEMENT, AND THE EXHIBITS ATTACHED THERETO   AND THE AGREEMENTS AND DOCUMENTS DESCRIBED THEREIN. IF THERE IS A CONFLICT   BETWEEN THE PLAN AND THIS DISCLOSURE STATEMENT, THE PROVISIONS OF THE PLAN   WILL GOVERN. YOU ARE ENCOURAGED TO REVIEW THE FULL TEXT OF THE PLAN AND PLAN   SUPPLEMENT AND TO READ CAREFULLY THE ENTIRE DISCLOSURE STATEMENT, INCLUDING   ALL EXHIBITS, BEFORE DECIDING HOW TO VOTE WITH RESPECT TO THE PLAN. THE   VOTING DEADLINE TO ACCEPT OR REJECT THE PLAN IS 4:00 P.M. (PREVAILING EASTERN   TIME) ON [AUGUST 15, 2019], UNLESS EXTENDED BY THE DEBTORS (THE “VOTING   DEADLINE”). TO BE COUNTED, BALLOTS MUST BE RECEIVED BY THE VOTING AGENT (AS   DEFINED HEREIN) ON OR BEFORE THE VOTING DEADLINE. THE EFFECTIVENESS OF THE   PLAN IS SUBJECT TO MATERIAL CONDITIONS PRECEDENT. THERE IS NO ASSURANCE THAT   THESE CONDITIONS WILL BE SATISFIED OR WAIVED. IF THE PLAN IS CONFIRMED BY THE   BANKRUPTCY COURT AND THE EFFECTIVE DATE OCCURS, ALL HOLDERS OF CLAIMS AGAINST,   AND HOLDERS OF INTERESTS IN, THE DEBTORS (INCLUDING, WITHOUT LIMITATION,   THOSE HOLDERS OF CLAIMS OR INTERESTS WHO DO NOT SUBMIT BALLOTS TO ACCEPT OR   REJECT THE PLAN OR WHO ARE NOT ENTITLED TO VOTE ON THE PLAN) WILL BE BOUND BY   THE TERMS OF THE PLAN AND THE TRANSACTIONS CONTEMPLATED THEREBY. THIS   DISCLOSURE STATEMENT HAS NOT BEEN FILED WITH OR REVIEWED BY, AND THE   SECURITIES TO BE ISSUED ON OR AFTER THE EFFECTIVE DATE WILL NOT HAVE BEEN THE   SUBJECT OF, OR REGISTERED PURSUANT TO, A REGISTRATION STATEMENT FILED WITH   THE SECURITIES AND EXCHANGE COMMISSION (THE “SEC”) UNDER THE SECURITIES ACT   OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR WITH ANY SECURITIES REGULATORY   AUTHORITY OF ANY STATE UNDER ANY STATE SECURITIES OR “BLUE SKY” LAWS, OR ANY   OTHER GOVERNMENTAL AUTHORITY OR REGULATORY BODY. THE PLAN HAS NOT BEEN   APPROVED OR DISAPPROVED BY THE SEC, ANY OTHER SECURITIES REGULATORY   AUTHORITY, OR ANY STATE SECURITIES COMMISSION, AND NEITHER THE SEC NOR ANY   STATE SECURITIES COMMISSION HAS PASSED UPON THE ACCURACY OR ADEQUACY OF THE   INFORMATION CONTAINED HEREIN. ANY REPRESENTATION TO THE CONTRARY IS A   CRIMINAL OFFENSE. THIS DISCLOSURE STATEMENT DOES NOT CONSTITUTE AN OFFER OR   SOLICITATION IN ANY STATE OR OTHER JURISDICTION IN WHICH SUCH OFFER OR   SOLICITATION IS NOT AUTHORIZED. ii 

    

 

THE DEBTORS   BELIEVE THAT THE SOLICITATION OF VOTES ON THE PLAN MADE BY THIS DISCLOSURE   STATEMENT, AND THE OFFER OF CERTAIN NEW SECURITIES THAT MAY BE DEEMED TO BE   MADE PURSUANT TO THE SOLICITATION, ARE EXEMPT FROM REGISTRATION UNDER THE   SECURITIES ACT AND RELATED STATE STATUTES BY REASON OF THE EXEMPTION PROVIDED   BY SECTION 1145(A)(1) OF THE BANKRUPTCY CODE, AND EXPECT THAT THE OFFER AND   ISSUANCE OF THE SECURITIES UNDER THE PLAN WILL BE EXEMPT FROM REGISTRATION   UNDER THE SECURITIES ACT AND RELATED STATE STATUTES BY REASON OF THE   APPLICABILITY OF SECTION 1145(a)(1) OF THE BANKRUPTCY CODE. EXCEPT AS   OTHERWISE SET FORTH HEREIN, THE STATEMENTS CONTAINED IN THIS DISCLOSURE   STATEMENT ARE MADE BY THE DEBTORS AS OF THE DATE HEREOF, AND THE DELIVERY OF   THIS DISCLOSURE STATEMENT WILL NOT, UNDER ANY CIRCUMSTANCES, CREATE ANY   IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AT ANY TIME   SUBSEQUENT TO THE DATE HEREOF OR CREATE ANY DUTY TO UPDATE SUCH INFORMATION.   NO PERSON HAS BEEN AUTHORIZED BY THE DEBTORS IN CONNECTION WITH THE PLAN OR   THE SOLICITATION TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION OTHER   THAN AS CONTAINED IN THIS DISCLOSURE STATEMENT, THE PLAN AND THE EXHIBITS,   NOTICES AND SCHEDULES ATTACHED TO OR INCORPORATED BY REFERENCE OR REFERRED TO   IN THIS DISCLOSURE STATEMENT AND/OR THE PLAN, AND, IF GIVEN OR MADE, SUCH   INFORMATION OR REPRESENTATION MAY NOT BE RELIED UPON AS HAVING BEEN   AUTHORIZED BY THE DEBTORS. IT IS THE DEBTORS’ POSITION THAT THIS DISCLOSURE   STATEMENT MAY NOT BE RELIED ON FOR ANY PURPOSE OTHER THAN TO DETERMINE   WHETHER TO VOTE TO ACCEPT OR REJECT THE PLAN, AND NOTHING STATED HEREIN SHALL   CONSTITUTE AN ADMISSION OF ANY FACT OR LIABILITY BY ANY PERSON, OR BE   ADMISSIBLE IN ANY PROCEEDING INVOLVING THE DEBTORS OR ANY OTHER PERSON, OR BE   DEEMED CONCLUSIVE EVIDENCE OF THE TAX OR OTHER LEGAL EFFECTS OF THE PLAN ON   THE DEBTORS OR HOLDERS OF CLAIMS OR INTERESTS. EXCEPT WHERE SPECIFICALLY   NOTED, THE FINANCIAL INFORMATION CONTAINED HEREIN HAS NOT BEEN AUDITED BY A   CERTIFIED PUBLIC ACCOUNTANT AND HAS NOT BEEN PREPARED IN ACCORDANCE WITH   GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. HOLDERS OF CLAIMS OR INTERESTS   SHOULD NOT CONSTRUE THE CONTENTS OF THIS DISCLOSURE STATEMENT AS PROVIDING   ANY LEGAL, BUSINESS, FINANCIAL OR TAX ADVICE. EACH HOLDER SHOULD CONSULT WITH   ITS OWN LEGAL, BUSINESS, FINANCIAL AND TAX ADVISOR(S) WITH RESPECT TO ANY   SUCH MATTERS CONCERNING THIS DISCLOSURE STATEMENT, THE SOLICITATION OF VOTES   TO ACCEPT THE PLAN, THE PLAN, THE PLAN DOCUMENTS AND THE TRANSACTIONS   CONTEMPLATED HEREBY AND THEREBY. iii 

    

 

FORWARD-LOOKING   STATEMENTS: THIS DISCLOSURE STATEMENT CONTAINS FORWARD-LOOKING STATEMENTS   BASED PRIMARILY ON THE CURRENT EXPECTATIONS OF THE DEBTORS AND PROJECTIONS   ABOUT FUTURE EVENTS AND FINANCIAL TRENDS AFFECTING THE FINANCIAL CONDITION OF   THE DEBTORS’ AND THE REORGANIZED DEBTORS’ BUSINESSES. IN PARTICULAR,   STATEMENTS USING WORDS SUCH AS “BELIEVE,” “MAY,” “ESTIMATE,” “CONTINUE,”   “ANTICIPATE,” “INTEND,” “EXPECT” AND SIMILAR EXPRESSIONS IDENTIFY THESE   FORWARD-LOOKING STATEMENTS. THESE FORWARD-LOOKING STATEMENTS ARE SUBJECT TO A   NUMBER OF RISKS, UNCERTAINTIES AND ASSUMPTIONS, INCLUDING THOSE DESCRIBED   BELOW UNDER ARTICLE XI. IN LIGHT OF THESE RISKS AND UNCERTAINTIES, THE   FORWARD-LOOKING EVENTS AND CIRCUMSTANCES DISCUSSED IN THE DISCLOSURE   STATEMENT MAY NOT OCCUR, AND ACTUAL RESULTS COULD DIFFER MATERIALLY FROM   THOSE ANTICIPATED IN THE FORWARD-LOOKING STATEMENTS. CONSEQUENTLY, THE   PROJECTED FINANCIAL INFORMATION AND OTHER FORWARD-LOOKING STATEMENTS   CONTAINED HEREIN SHOULD NOT BE REGARDED AS REPRESENTATIONS BY ANY OF THE   DEBTORS, THE REORGANIZED DEBTORS, THEIR ADVISORS OR ANY OTHER PERSON THAT THE   PROJECTED FINANCIAL CONDITIONS OR RESULTS OF OPERATIONS CAN OR WILL BE   ACHIEVED. EXCEPT AS OTHERWISE REQUIRED BY LAW, NEITHER THE DEBTORS NOR THE   REORGANIZED DEBTORS UNDERTAKE ANY OBLIGATION TO UPDATE OR REVISE PUBLICLY ANY   FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE   EVENTS OR OTHERWISE FOLLOWING APPROVAL OF THIS DISCLOSURE STATEMENT BY THE   BANKRUPTCY COURT. THE DEBTORS AND THE PLAN SUPPORT PARTIES SUPPORT   CONFIRMATION OF THE PLAN, AND URGE ALL HOLDERS OF CLAIMS WHOSE VOTES ARE   BEING SOLICITED TO ACCEPT THE PLAN. FOR THE AVOIDANCE OF DOUBT, THE PLAN   SUPPORT PARTIES DO NOT INCLUDE THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS   (THE “COMMITTEE”). THE COMMITTEE CONTINUES TO DISCUSS CERTAIN PLAN PROVISIONS   WITH THE DEBTORS AND INVESTIGATE CLAIMS. THE COMMITTEE HAS NOT MADE A   DETERMINATION AT THIS TIME AS TO WHETHER IT DOES OR DOES NOT SUPPORT THE   PLAN. iv 

    

 

TABLE OF   CONTENTS Page ARTICLE I. 1.1. 1.2. 1.3. 1.4. 1.5. INTRODUCTION   .............................................................................................1   General.   ..............................................................................................................1   The Confirmation Hearing.   ................................................................................3   Classification of Claims and   Interests................................................................4   Voting; Holders of Claims Entitled to Vote.   .....................................................4 Important   Matters...............................................................................................7   ARTICLE II. SUMMARY OF PLAN AND CLASSIFICATION AND TREATMENT OF CLAIMS AND   INTERESTS THEREUNDER..................8 General.   ..............................................................................................................8   Summary of Treatment of Claims and Interests Under the Plan.   ......................9 2.1. 2.2. ARTICLE III. 3.1. 3.5. BUSINESS   DESCRIPTION; HISTORICAL INFORMATION.....................19 General   Background, History and Key Product   Lines.....................................19 Debtors’ Prepetition Capital   Structure.............................................................26   ARTICLE IV. EVENTS LEADING TO CHAPTER 11   FILING...........................................28 ARTICLE V. REASONS FOR   THE SOLICITATION; RECOMMENDATION ................36 ARTICLE VI. 6.1. 6.2.   6.3. 6.4. 6.5. 6.6. THE PLAN ......................................................................................................36   Overview of Chapter   11...................................................................................36   Resolution of Certain Inter-Creditor and Inter-Debtor Issues.   ........................37 Overview of the Plan.   ......................................................................................38   Classification of Claims and   Interests..............................................................43 Treatment   of Claims and Interests.   ..................................................................44   Acceptance or Rejection of the Plan; Effect of Rejection by One or More   Classes of Claims or Interests.   ...............................................................49 Means for   Implementation.   ..............................................................................50   Executory Contracts and Unexpired Leases.   ...................................................57 Binding Effect.   .................................................................................................61   Discharge of Claims Against and Interests in the Debtors.   .............................61 Term of Pre-Confirmation Injunctions or   Stays. .............................................62 Injunction Against   Interference with the Plan.   ................................................63 Injunction.   ........................................................................................................63   Releases............................................................................................................64   Exculpation and Limitation of Liability.   .........................................................68 Injunction   Related to Releases and Exculpation..............................................68   Retention of Causes of Action/Reservation of Rights.   ....................................68 Indemnification Obligations.   ...........................................................................69   6.7. 6.8. 6.9. 6.10. 6.11. 6.12. 6.13. 6.14. 6.15. 6.16. 6.17. 6.18. v 

    

 

ARTICLE VII.   7.1. 7.2. 7.3. 7.4. 7.5. 7.6. 7.7. 7.8. 7.9. 7.10. 7.11. 7.12. CONFIRMATION   OF THE PLAN OF REORGANIZATION ......................69 Confirmation Hearing.   .....................................................................................69   Confirmation.   ...................................................................................................72   Standards Applicable to Releases.   ...................................................................77   Classification of Claims and   Interests..............................................................78   Consummation.   ................................................................................................79   Exemption from Certain Transfer Taxes.   ........................................................79 Retiree   Benefits................................................................................................79   Dissolution of the Committee. .........................................................................79   Termination of Professionals.   ..........................................................................79   Amendments.   ...................................................................................................80   Revocation or Withdrawal of the   Plan.............................................................80   Post-Confirmation Jurisdiction of the Bankruptcy Court.   ...............................80 ARTICLE VIII. ALTERNATIVES TO CONFIRMATION   AND CONSUMMATION OF THE PLAN   ................................................................................................82   Liquidation Under Chapter 7 of the Bankruptcy Code.   ...................................82 Alternative Plan(s) of Reorganization.   ............................................................82 Dismissal of   the Chapter 11   Cases...................................................................83   8.1. 8.2. 8.3. ARTICLE IX. SUMMARY OF VOTING PROCEDURES   ...................................................84 ARTICLE X. 10.1. 10.2.   10.3. 10.4. 10.5. 10.6. 10.7. 10.8. 10.9. 10.10. 10.11. 10.12. DESCRIPTION   AND HISTORY OF CHAPTER 11 CASES........................84 General Case   Background................................................................................84   Procedural Motions.   .........................................................................................85   Retention of Professionals.   ..............................................................................85   Employment Obligations.   ................................................................................86   Continuing Supplier and Customer   Relations..................................................86 Cash Management   System. ..............................................................................87   Tax   Motion.......................................................................................................87   Utilities.............................................................................................................87   Schedules and Statements.   ...............................................................................87   Bar   Dates..........................................................................................................88   The DIP Facility...............................................................................................88   Motion to Approve Certain Bid Protections Contained in the Plan Funding   Agreement.   ........................................................................................88   Motion to Approve Payment of Certain Prepetition Government Settlement   Claims.   ...........................................................................................88   Motion to Assume the Shared Services Agreements. ......................................89   Appointment of an Official Committee of Unsecured   Creditors.....................89 10.13. 10.14. 10.15. ARTICLE XI. 11.1. 11.2.   11.3. CERTAIN RISK FACTORS TO BE CONSIDERED   ....................................90 Certain Bankruptcy Considerations.   ................................................................90 Risks   Relating to the Capital Structure of the Reorganized Debtors.   ..............94 Risks Relating to Tax Consequences of the   Plan.............................................97 vi 

    

 

11.4. 11.5.   Risks Associated with the Debtors’   Businesses...............................................97 Risks Associated   with the Plan Investor’s Businesses. .................................104   ARTICLE XII. 12.1. 12.2. 12.3. RIGHTS OFFERING PROCEDURES   .........................................................107 Overview of   Rights Offering.   ........................................................................107   The Rights Offering Procedures. ...................................................................108   Backstop   Commitment...................................................................................108   ARTICLE XIII. CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE   PLAN....................................109   Introduction....................................................................................................109   Federal Income Tax Consequences to the   Debtors........................................110 Federal Income Tax   Consequences to the Plan Investor. ..............................112 Federal   Income Tax Consequences to Holders of Certain Claims. ...............113   Federal Income Tax Consequences to Non-U.S. Holders.   ............................123 13.1. 13.2. 13.3. 13.4. 13.5. ARTICLE XIV.   CERTAIN UNITED KINGDOM INCOME TAX CONSEQUENCES OF THE PLAN   ..............................................................................................125   ARTICLE XV. 15.1. 15.2. 15.3. SECURITIES LAW MATTERS   ...................................................................127   General.   ..........................................................................................................127   Initial Offer and Sale of Securities Under Federal Securities Laws.   .............127 Subsequent Transfers. ....................................................................................128   ARTICLE XVI. 16.1. 16.2. 16.3. 16.4. 16.5. 16.6. 16.7. 16.8. 16.9. 16.10.   16.11. 16.12. 16.13. 16.14. 16.15. 16.16. PROCEDURES FOR DISTRIBUTIONS UNDER   THE PLAN...................130   Distributions...................................................................................................130   No Postpetition Interest on Claims.   ...............................................................131 Date of   Distributions......................................................................................131   Distribution Record Date.   ..............................................................................131   Disbursing Agent. ..........................................................................................131   Delivery of Distribution.   ................................................................................132   Unclaimed Property.   ......................................................................................133   Satisfaction of Claims.   ...................................................................................134   Manner of Payment Under   Plan.....................................................................134   Fractional Shares; De Minimis Cash Distributions.   ......................................134 Distributions on Account of Allowed   Claims Only.......................................134 No Distribution in   Excess of Amount of Allowed Claim..............................134 Exemption   from Securities   Laws...................................................................134   Setoffs and   Recoupments...............................................................................135   Withholding and Reporting Requirements. ...................................................135   Hart-Scott Rodino Antitrust Improvements Act.   ...........................................136 ARTICLE XVII. 17.1. 17.2.   PROCEDURES FOR RESOLVING CLAIMS   .............................................136 Claims Process. ..............................................................................................136   Amendment to Claims.   ..................................................................................136   vii 

    

 

17.3. 17.4.   Disputed   Claims.............................................................................................137   Estimation of   Claims......................................................................................137   viii 

    

 

Annexed as   exhibits to this Disclosure Statement are copies of the following documents:   • Plan (Exhibit 1) • Liquidation Analysis (Exhibit 2) Reorganized Debtors’   Projected Financial Information (Exhibit 3) • • Rights Offering Procedures   and Subscription Form (Exhibit 4) • Restructuring Support Agreement (Exhibit   5) Plan Funding Agreement (Exhibit 6) • ix 

    

 

ARTICLE I.   INTRODUCTION 1.1. General. Aegerion Pharmaceuticals, Inc. and Aegerion   Pharmaceuticals Holdings, Inc. (collectively, the “Debtors”), in chapter 11   cases pending before the United States Bankruptcy Court for the Southern   District of New York (the “Bankruptcy Court”), hereby transmit this   disclosure statement (as may be amended, supplemented or otherwise modified   from time to time, the “Disclosure Statement”), pursuant to section 1125 of   title 11 of the United States Code (the “Bankruptcy Code”), in connection   with the Debtors’ solicitation of votes to confirm the Debtors’ Joint Chapter   11 Plan, dated as of May 20, 2019 (as may be amended, supplemented or   otherwise modified from time to time, the “Plan”). All Plan Documents are   subject to revision and modification from time to time prior to the Effective   Date (subject to the terms of the Plan and the parties’ rights under the RSA   and the Plan Funding Agreement), which may result in material changes to the   terms of the Plan Documents. On the Effective Date, the Plan, all Plan   Documents and all other agreements entered into or instruments issued in   connection with the Plan and any Plan Document, shall become effective and   binding in accordance with their respective terms and conditions upon the   parties thereto and shall be deemed to become effective simultaneously. The   purpose of this Disclosure Statement is to set forth information: (i)   regarding the history of the Debtors and their businesses; (ii) describing   the Chapter 11 Cases; (iii) concerning the Plan; (iv) advising the holders of   Claims and Interests of their rights under the Plan; (v) providing information   regarding eligibility and participation in the Rights Offering for New Common   Stock; and (vi) assisting the holders of Claims entitled to vote on the Plan   in making an informed judgment regarding whether they should vote to accept   or reject the Plan. The Debtors filed the Debtors’ Motion for Order: (I)   Approving Disclosure Statement; (II) Establishing Date of Confirmation   Hearing; (III) Establishing Procedures for Solicitation and Tabulation of   Votes to Accept or Reject Plan, Including (A) Approving Form and Manner of   Solicitation Packages, (B) Approving Form and Manner of Notice of   Confirmation Hearing, (C) Establishing Record Date and Approving Procedures   for Distribution of Solicitation Packages, (D) Approving Forms of Ballots,   (E) Establishing Deadline for Receipt of Ballots, and (F) Approving   Procedures for Vote Tabulations; (IV) Establishing Deadline and Procedures   for Filing Objections to Confirmation of Plan; (V) Approving Rights Offering   Procedures; and (VI) Granting Related Relief [Docket No. 63] requesting that   the Bankruptcy Court schedule a hearing to approve this Disclosure Statement   as containing “adequate information” within the meaning of section 1125(a) of   the Bankruptcy Code and the solicitation of votes on the Plan as being in   compliance with section 1126 of the Bankruptcy Code on July 11, 2019 at 9:00   a.m. (prevailing Eastern time). At such a hearing, after providing requisite   notice thereof, the Debtors will seek entry of an order by the Bankruptcy   Court (the “Disclosure Statement Order”) to, among other things: (i) approve   this Disclosure Statement as containing “adequate information” to enable a   hypothetical, reasonable investor typical of holders of Claims against the   Debtors to make an informed judgment as to whether to accept or reject the   Plan; and (ii) authorize the Debtors to use this Disclosure Statement in 1 

    

 

connection with   the solicitation of votes to accept or reject the Plan. Pursuant to the   proposed Disclosure Statement Order, the Debtors will seek to establish   August 15, 2019 at 4:00 p.m. (prevailing Eastern time) as the voting deadline   for the return of Ballots accepting or rejecting the Plan (the “Voting   Deadline”). APPROVAL OF THIS DISCLOSURE STATEMENT WILL NOT, HOWEVER,   CONSTITUTE A DETERMINATION BY THE BANKRUPTCY COURT AS TO THE FAIRNESS OR   MERITS OF THE PLAN. The Disclosure Statement Order sets forth in detail the   deadlines, procedures and instructions for voting to accept or reject the   Plan and to participate in the Rights Offering, and for filing objections to   confirmation of the Plan, the record date for voting purposes and the   applicable standards for tabulating Ballots. In addition, detailed voting   instructions accompany each Ballot. Each holder of a Claim entitled to vote   on the Plan should read this Disclosure Statement and the exhibits hereto,   including the Plan, as well as the instructions accompanying the Ballot in   their entirety before voting on the Plan. These documents contain important   information concerning the classification of Claims and Interests for voting   purposes and the tabulation of votes. No solicitation of votes may be made   except pursuant to this Disclosure Statement, once approved by the Bankruptcy   Court, and section 1125 of the Bankruptcy Code. In voting on the Plan, holders   of Claims entitled to vote should not rely on any information relating to the   Debtors and their businesses other than the information contained in this   Disclosure Statement, the Plan and all exhibits hereto and thereto. PURSUANT   TO THE RSA, THE PLAN SUPPORT PARTIES, REPRESENTING 100% IN DOLLAR AMOUNT AND   NUMBER OF HOLDERS OF CLASS 3 AND CLASS 4 CLAIMS, AND IN EXCESS OF 67% IN   DOLLAR AMOUNT OF CLASS 6B CLAIMS — THE ONLY CLASSES ENTITLED TO VOTE ON THE   PLAN — HAVE AGREED TO SUPPORT AND VOTE TO ACCEPT THE PLAN AFTER THE ENTRY OF   THE DISCLOSURE STATEMENT ORDER AND THE SOLICITATION OF VOTES ON THE PLAN. FOR   THE AVOIDANCE OF DOUBT, THE COMMITTEE IS NOT A “PLAN SUPPORT PARTY” AND HAS   NOT MADE A DETERMINATION AT THIS TIME AS TO WHETHER IT DOES OR DOES NOT SUPPORT   THE PLAN. THE DEBTORS RECOMMEND THAT HOLDERS OF CLAIMS IN CLASSES 3, 4 AND 6B   VOTE TO ACCEPT THE PLAN. Additional copies of this Disclosure Statement   (including exhibits) are available upon request to the Debtors’ claims and   voting agent, Prime Clerk LLC (“Prime Clerk”), at the following address:   Aegerion Ballot Processing c/o Prime Clerk LLC One Grand Central Place 60   East 42nd Street, Suite 1440 New York, NY 10165 They may also be obtained by   contacting Prime Clerk via telephone at 844-627-5368 or for international   calls at 347-292-3524. Additional copies of this Disclosure Statement 2 

    

 

(including   exhibits) can also be accessed free of charge from the following website:   http://cases.primeclerk.com/Aegerion. A Ballot for voting to accept or reject   the Plan is enclosed with this Disclosure Statement for the holders of Claims   that are entitled to vote to accept or reject the Plan. If you are a holder   of a Claim entitled to vote on the Plan and did not receive a Ballot,   received a damaged Ballot or lost your Ballot, or if you have any questions   concerning the procedures for voting on the Plan, please contact Prime Clerk   at the address above. In addition, holders of Class 4 and Class 6B Claims   will also receive a subscription form with accompanying instructions for   participating in the Rights Offering. Detailed procedures with respect to the   Rights Offering are attached as Exhibit 4 to this Disclosure Statement and   will also be provided separately to parties entitled to participate in the   Rights Offering. The deadline to participate in the Rights Offering is   [August 15, 2019] at 4:00 p.m. (prevailing Eastern time). Each holder of a   Claim entitled to vote on the Plan should read this Disclosure Statement, the   Plan, the other exhibits attached hereto and thereto and the instructions   accompanying the Ballots in their entirety before voting on the Plan. These   documents contain important information concerning the classification of   Claims and Interests for voting purposes and the tabulation of votes. 1.2.   The Confirmation Hearing. In accordance with the Disclosure Statement Order   and section 1128 of the Bankruptcy Code, a hearing will be held before the   Honorable Martin Glenn, United States Bankruptcy Judge for the Southern   District of New York, United States Bankruptcy Court, 1 Bowling Green, New   York, New York 10004, on [September 5, 2019] at [ ] [ ].m. (prevailing   Eastern time), to consider confirmation of the Plan. Objections, if any, to   confirmation of the Plan must be served and filed so that they are received   on or before [August 22, 2019] at 4:00 p.m. (prevailing Eastern time), in the   manner set forth in the Disclosure Statement Order. The hearing on   confirmation of the Plan may be adjourned from time to time without further   notice except for the announcement of the adjourned date and time at the   hearing on confirmation or any adjournment thereof or an appropriate filing   with the Bankruptcy Court. At the Confirmation Hearing, the Bankruptcy Court   will, among other things: • determine whether sufficient majorities in number   and amount from each Class entitled to vote have delivered properly executed votes   to approve the Plan; • hear and determine objections, if any, to the Plan and   to confirmation of the Plan that have not been previously disposed of; •   determine whether the Plan meets the confirmation requirements of the   Bankruptcy Code; and determine whether to confirm the Plan. • 3 

    

 

1.3.   Classification of Claims and Interests. The following table designates the   Classes of Claims against and Interests in the Debtors, and specifies which   Classes are: (a) impaired or unimpaired by the Plan; (b) entitled to vote to   accept or reject the Plan in accordance with section 1126 of the Bankruptcy   Code; or (c) deemed to accept or reject the Plan. 1.4. Voting; Holders of   Claims Entitled to Vote. (a) General Voting Procedures. Pursuant to the   provisions of the Bankruptcy Code, only holders of allowed claims or equity   interests in classes of claims or equity interests that are “impaired” and   that are not deemed to have rejected a chapter 11 plan are entitled to vote   to accept or reject such proposed plan. Generally, a claim or interest is   “impaired” under a plan if the holder’s legal, equitable or contractual   rights are altered under such plan. Classes of claims or equity interests   under a chapter 11 plan in which the holders of claims or equity interests   are unimpaired are presumed to have accepted such plan and are not entitled   to vote to accept or reject the proposed plan. In addition, classes of claims   or equity interests in which the holders of claims or equity interests will   not receive or retain any property on account of their claims or equity   interests are deemed to have rejected the chapter 11 plan and are not   entitled to vote to accept or reject such plan. Under the Plan: • Claims in   Classes 3, 4 and 6B are impaired, will receive a distribution on account of   such Claims to the extent provided in the Plan and are entitled to vote to   accept or reject the Plan; 4 Class Designation Impairment Entitled to Vote   Class 1 Priority Non-Tax Claims No No (Presumed to accept) Class 2 Other   Secured Claims No No (Presumed to accept) Class 3 Bridge Loan Claims Yes Yes   Class 4 Novelion Intercompany Loan Claims Yes Yes Class 5 Government   Settlement Claims No No (Presumed to accept) Class 6A Ongoing Trade Claims No   No (Presumed to accept) Class 6B Other General Unsecured Claims Yes Yes Class   7 Existing Securities Law Claims Yes No (Deemed to reject) Class 8 Existing   Interests Yes No (Deemed to reject) 

    

 

• Claims in   Classes 1, 2, 5 and 6A are unimpaired and, as a result, holders of such Claims   are presumed to have accepted the Plan and are not entitled to vote to accept   or reject the Plan; and • Claims and Interests in Classes 7 and 8 are   impaired and the holders of such Claims and Interests will not receive any   distribution under the Plan on account of such Claims and Interests. As a   result, the holders of Claims and Interests in those Classes are deemed to   have rejected the Plan and are not entitled to vote to accept or reject the   Plan. The Bankruptcy Code defines “acceptance” of a plan by a class of claims   as acceptance by creditors in that class that hold at least two-thirds (2/3)   in dollar amount and more than one-half (1/2) in number of the claims that   cast ballots for acceptance or rejection of the chapter 11 plan. Your vote on   the Plan is important. The Bankruptcy Code requires as a condition to   confirmation of a chapter 11 plan that each class that is impaired and   entitled to vote under a plan vote to accept such plan, unless the   requirements of section 1129(b) of the Bankruptcy Code are satisfied. If a   Class of Claims entitled to vote on the Plan rejects the Plan, the Debtors   reserve the right, subject to the parties’ rights under the RSA and the Plan   Funding Agreement, to amend the Plan and/or to request confirmation of the   Plan pursuant to section 1129(b) of the Bankruptcy Code with respect to such   Class. Section 1129(b) of the Bankruptcy Code permits the confirmation of a   chapter 11 plan notwithstanding the non-acceptance of such plan by one or   more impaired classes of claims or equity interests, so long as at least one   impaired class of claims or interests votes to accept such plan (excluding   any votes of insiders). Under that section, a chapter 11 plan may be   confirmed by a bankruptcy court if it does not “discriminate unfairly” and is   “fair and equitable” with respect to each non-accepting class. If you are   entitled to vote to accept or reject the Plan, a Ballot is enclosed for the   purpose of voting on the Plan. This Disclosure Statement, the exhibits   attached hereto, the Plan and the related documents are the only materials   the Debtors are providing to creditors for their use in determining whether   to vote to accept or reject the Plan, and it is the Debtors’ position that   such materials may not be relied upon or used for any purpose other than to   vote to accept or reject the Plan. Please complete and sign your Ballot(s)   and, unless you are sending your Ballot to an Intermediary (as defined below)   for inclusion in a master Ballot, return such Ballot to the Debtors’ claims   and voting agent (the “Voting Agent”) at the applicable address below:   Aegerion Ballot Processing c/o Prime Clerk LLC One Grand Central Place 60   East 42nd Street, Suite 1440 New York, NY 10165 Phone: 844-627-5368 (U.S.   toll free) or 347-292-3524 (international) 5 

    

 

TO BE COUNTED,   YOUR ORIGINAL BALLOT INDICATING ACCEPTANCE OR REJECTION OF THE PLAN MUST BE   ACTUALLY RECEIVED BY THE VOTING AGENT NO LATER THAN 4:00 P.M., PREVAILING   EASTERN TIME, ON [AUGUST 15, 2019], UNLESS EXTENDED BY THE DEBTORS. YOUR   BALLOT MAY BE SENT VIA MAIL, OVERNIGHT COURIER OR MESSENGER. FAXED COPIES AND   VOTES SENT ON OTHER FORMS WILL NOT BE ACCEPTED EXCEPT IN THE DEBTORS’ SOLE   DISCRETION. ALL BALLOTS MUST BE SIGNED. IF YOU ARE SENDING YOUR BALLOT TO AN   INTERMEDIARY FOR INCLUSION IN A MASTER BALLOT, THE INTERMEDIARY MUST RECEIVE   YOUR PROPERLY COMPLETED BALLOT BY SUCH TIME AND DATE AS SPECIFIED BY THE   INTERMEDIARY THAT ALLOWS THE INTERMEDIARY SUFFICIENT TIME TO PROCESS THE   BALLOTS. The Ballots have been specifically designed for the purpose of   soliciting votes on the Plan from the Classes entitled to vote thereon.   Accordingly, in voting on the Plan, please use only the Ballots sent to you   with this Disclosure Statement or provided by the Voting Agent. Pursuant to   the proposed Disclosure Statement Order, the Debtors intend to fix 5:00 p.m.   (prevailing Eastern time) on [July 11, 2019] (the “Voting Record Date”) as   the time and date for the determination of the Persons who are entitled to   receive a copy of this Disclosure Statement and all of the related materials   and to vote whether to accept or reject the Plan. Accordingly, only holders   of Claims of record as of the Voting Record Date that are entitled to vote on   the Plan will receive a Ballot and may vote on the Plan. All properly completed   Ballots received prior to the Voting Deadline will be counted for purposes of   determining whether a voting Class of impaired Claims has accepted the Plan.   Under the Bankruptcy Code, for the Plan to be “accepted,” a specified   majority vote is required for each Class of impaired Claims entitled to vote   on the Plan. If no votes are received with respect to any Class of impaired   Claims entitled to vote on the Plan, then such Class shall be deemed to have   accepted the Plan. If any impaired Class fails to have any Allowed Claims or   Claims temporarily Allowed by the Court as of the date of the Confirmation   Hearing, such Class or Classes will be deemed eliminated from the Plan for   all purposes. The Voting Agent will prepare and file with the Bankruptcy Court   a certification of the results of the balloting with respect to the Classes   entitled to vote. (b) Voting Through Intermediaries. In accordance with   Bankruptcy Rule 3017(e), the Debtors will send Ballots to transfer agents,   registrars, servicing agents or other intermediaries for, or acting on behalf   of, beneficial holders of certain Claims (collectively, the   “Intermediaries”). Specifically, the Debtors will send Ballots to   Intermediaries for certain holders of Class 6B Other General Unsecured Claims   (i.e., holders of Convertible Notes Claims). Each Intermediary will be   entitled to receive, upon request to the Debtors, a sufficient number of   Ballots to distribute to the beneficial owners of the Claims for which it is   an Intermediary. Each Intermediary who will be tabulating votes of beneficial   holders in a summary “master” ballot in the form approved by the Bankruptcy   Court (the “Master Ballot”) will tabulate only those votes of its beneficial   holders that are received by such Intermediary by such time and date (as   specified by the Intermediary) that would allow it to tabulate and return the   results to the Voting Agent by the Voting Deadline. 6 

    

 

Any   Intermediaries submitting Master Ballots must certify that none of its   beneficial holders has cast more than one vote with respect to any given   Claim, even if such holder holds securities of the same type in more than one   account. However, persons who hold Claims in more than one voting Class will   be entitled to vote their Claims in each such Class, subject to the   applicable voting rules. For more information on voting procedures, please   see Article IX of this Disclosure Statement. 1.5. Important Matters. This   Disclosure Statement contains projected financial information and certain   other forward-looking statements, all of which are based on various estimates   and assumptions and will not be updated to reflect events occurring after the   date hereof. Such information and statements are subject to inherent   uncertainties and to a wide variety of significant business, economic and   competitive risks, including, among others, those described herein.   Consequently, actual events, circumstances, effects and results may vary   significantly from those included in or contemplated by such projected   financial information and such other forward-looking statements. The   projected financial information contained herein and in the exhibits annexed   hereto, therefore, is not necessarily indicative of the future financial   condition or results of operations of the Debtors, which in each case may   vary significantly from those set forth in such projected financial   information. Consequently, the projected financial information and other   forward-looking statements contained herein should not be regarded as   representations by any of the Debtors, the Reorganized Debtors, their   advisors, or any other Person that the projected financial conditions or   results of operations can or will be achieved. 7 IMPORTANT - Voting by   Intermediary Timing: If your vote is being processed by an Intermediary,   please allow sufficient time for transmission of your ballot to your   Intermediary for preparation and delivery to the Voting Agent of a Master   Ballot reflecting your vote and the votes of the holders of other Claims   tabulated by the Intermediary. To be counted, your vote must be received   either (a) directly by the Voting Agent on or before the Voting Deadline, or   (b) if your vote is processed by an Intermediary, by your Intermediary by   such time and date as specified by such Intermediary that allows such   Intermediary sufficient time to process your Ballot. Receipt of your Ballot   by the Intermediary on or close to the Voting Deadline may not allow   sufficient time for the Intermediary to include your vote in the Master   Ballot that it must deliver to the Voting Agent by the Voting Deadline.   Questions on Voting Procedures: If you have a question concerning the voting   procedures, please contact your Intermediary or the Voting Agent. 

    

 

ARTICLE II.   SUMMARY OF PLAN AND CLASSIFICATION AND TREATMENT OF CLAIMS AND INTERESTS   THEREUNDER 2.1. General. The overall purpose of the Plan is to provide for   the restructuring of the Debtors’ liabilities in a manner designed to   maximize recovery to stakeholders and to enhance the financial viability of   the Reorganized Debtors. Generally, the Plan provides for: (a) the Plan   Investor to acquire 100% of the equity interests of reorganized Aegerion in   exchange for New Common Stock of the Plan Investor in the amounts set forth   in the Plan and the Plan Funding Agreement; (b) a balance sheet restructuring   regarding the Debtors’ current debt obligations under the Novelion   Intercompany Loan Credit Agreement, the Convertible Notes Indenture, and the   Bridge Loan Credit Agreement; (c) the unimpairment of the Debtors’ ongoing   trade creditors and all Government Settlement Claims; (d) conversion of the   Novelion Intercompany Loan and Other General Unsecured Claims (which include,   among other things, the Convertible Notes Claims, Claims held by former   officers, directors, or employees of the Debtors for indemnification,   contribution or advancement expenses, and contract rejection damages Claims)   into the new equity of the Plan Investor and New Convertible Notes, pursuant   to the terms of the Plan and as described herein, subject to dilution on   account of any management incentive plan, the Rights Offering, the Plan   Investor Equity Raise, conversion of the New Convertible Notes, and any   contingent value rights issued to existing shareholders of the Plan Investor;   (e) refinancing of the Bridge Loan into a new secured term loan facility of   reorganized Aegerion, with an extended maturity date of five years; (f) a new   equity raise of $60 million— $42 million of which is on account of the Rights   Offering conducted under the Plan and $18 million of which is on account of   the supplemental equity raise conducted by the Plan Investor for shares of   New Common Stock in the Plan Investor— all of which is being backstopped by   the Backstop Parties;2 and 2 The Backstop Parties consist of those funds   managed by Highbridge, Athyrium, Whitebox and UBS that are party to the   Backstop Commitment Agreement. Notwithstanding any language to the contrary   contained in the Disclosure Statement, Plan, Confirmation Order, and/or Plan   Documents, the Backstop Parties shall not be allowed to participate in the   Rights Offering in an amount greater than their respective Allowed Claims. 8 

    

 

(g) no recovery   to the holders of Existing Securities Law Claims or Existing Interests on   account of their respective Claims and Interests. 2.2. Summary of Treatment   of Claims and Interests Under the Plan. The following table classifies Claims   against, and Interests in, the Debtors into separate Classes and summarizes   the treatment of each Class under the Plan. The table also identifies which   Classes are entitled to vote on the Plan based on the provisions of the   Bankruptcy Code. Finally, the table indicates the estimated recovery for each   Class. The summaries in this table are qualified in their entirety by the   description and the treatment of such Claims and Interests in the Plan. As   described in Article XI below, the Debtors’ businesses are subject to a   number of risks. The uncertainties and risks related to the Reorganized   Debtors make it difficult to determine a precise value of the New Common   Stock distributed under the Plan. The recoveries and estimates described in   the table represent the Debtors’ best estimates given the information   available on the date of this Disclosure Statement and the value ascribed to   the New Common Stock by the Plan Investor and the other Plan Support Parties.   All statements relating to the aggregate amount of Claims and Interests in   each Class are only estimates based on information known to the Debtors as of   the date hereof, and the final amounts of Allowed Claims in any particular   Class may vary significantly from these estimates. In addition, and as set   forth in the Plan Funding Agreement, the Debtors, in the exercise of their fiduciary   duties, are in the process of pursuing alternative transactions that may be   superior to the Proposed Restructuring Transaction. To the extent the Debtors   seek approval of a Company Superior Proposal (as such term is defined in the   Plan Funding Agreement) in the event such a proposal emerges as part of the   marketing process, the Proposed Restructuring Transaction will not be pursued   and the Plan will need to be modified or a new plan proposed. In accordance   with section 1123(a)(1) of the Bankruptcy Code, DIP Claims, Administrative   Expense Claims, Fee Claims, U.S. Trustee Fees and Priority Tax Claims have   not been classified, and the holders thereof are not entitled to vote on the   Plan. Except as specifically noted therein, the Plan does not provide for   payment of postpetition interest on any Allowed Claims. 9 

    

 

3 The amounts   set forth in this chart reflect the Debtors’ most current estimates of   projected claim amounts. 4 Estimated recoveries for those classes receiving   New Common Stock under the Plan are based on the implied equity value of the   combined reorganized company of $370.7 million, as set forth in Schedule 1.92   of Exhibit 1 hereto. 10 Class Description Treatment Entitled to Vote   Estimated Amount of Claims in Class3 Estimated Recovery4 N/A (unclassified)   DIP Claims On the Effective Date, the DIP Claims shall be Allowed and shall   not be subject to any avoidance, reductions, setoff, offset, recoupment,   recharacterization, subordination (whether equitable, contractual, or otherwise),   counterclaims, cross-claims, defenses, disallowance, impairment, objection,   or any other challenges under any applicable law or regulation by any Person.   In full satisfaction, settlement, release and discharge of the Allowed DIP   Claims, on the Effective Date, Allowed DIP Claims shall (a) be paid in Cash   to the greatest extent possible from available Cash of the Debtors (as   reasonably agreed by the Debtors and the DIP Lenders), and (b) to the extent   the Allowed DIP Claims are not paid in N/A $10,000,000 100% Important Note on   Estimates The estimates in the tables and summaries in this Disclosure   Statement may differ from actual distributions because of variations in the   asserted or estimated amounts of Allowed Claims, the existence of Disputed   Claims and other factors. Statements regarding projected amounts of Claims or   distributions (or the value of such distributions) are estimates by the   Debtors based on current information and are not representations as to the   accuracy of these amounts. Except as otherwise indicated, these statements   are made as of the date of this Disclosure Statement, and the delivery of   this Disclosure Statement will not, under any circumstances, imply that the   information contained in this Disclosure Statement is correct at any other   time. Any estimates of Claims or Interests in this Disclosure Statement may   vary from the final amounts of Claims or Interests allowed by the Bankruptcy   Court and such estimates are subject to material additions by the Debtors. 

    

 

11 Class   Description Treatment Entitled to Vote Estimated Amount of Claims in Class3   Estimated Recovery4 full in Cash on the Effective Date, receive New   Convertible Notes in an amount equal to the amount of the Allowed DIP Claims   not receiving Cash pursuant to the foregoing clause (a). Distributions on   account of Allowed DIP Claims other than Cash will not be distributed to the   DIP Administrative Agent but instead shall be distributed directly to the DIP   Lenders as reflected on the registry maintained by the DIP Administrative   Agent as of the Confirmation Date. The Debtors will request such registry   from the DIP Administrative Agent. Upon satisfaction of the Allowed DIP   Lender Claims as set forth in Section 3.1 of the Plan, all Liens and security   interests granted to secure such obligations, whether in the Chapter 11 Cases   or otherwise, shall be terminated and of no further force or effect. N/A   (unclassified) Administrative Expense Claims Except to the extent that a   holder of an Allowed Administrative Expense Claim agrees to a different   treatment, on, or as soon thereafter as is reasonably practicable, the later   of the Effective Date and the first Business Day after the date that is   thirty (30) calendar days after the date an Administrative Expense Claim becomes   an Allowed Claim, the holder of such Allowed Administrative Expense Claim   shall receive from the applicable Reorganized Debtor Cash in an amount equal   to such Allowed Claim; provided, however, that Allowed Administrative Expense   Claims representing liabilities incurred in the ordinary course of business   by any of the Debtors, as debtors in possession, shall be paid by the   applicable Reorganized Debtor in the ordinary course of business, consistent   with past practice and in accordance with the terms and subject to the   conditions of any orders or agreements governing, instruments evidencing, or   N/A $4,000,000 100% 

    

 

12 Class   Description Treatment Entitled to Vote Estimated Amount of Claims in Class3   Estimated Recovery4 other documents relating to, such liabilities. Any Claim   related to fees and expenses, contribution or indemnification obligations,   payable or owing by the Debtors to the Ad Hoc Group, the Plan Investor, or   the Backstop Parties under the RSA, the Backstop Commitment Agreement, the   Plan Funding Agreement, or the PFA Order shall constitute an Allowed   Administrative Expense Claim and shall be paid in Cash on the Effective Date   or as soon thereafter as is reasonably practicable without the need to file a   proof of such Claim with the Bankruptcy Court in accordance with Section   3.2(a) of the Plan and without further order of the Bankruptcy Court. Any   Claim then payable or owing by the Debtors to Novelion or Novelion Services,   USA, Inc. arising out of or related to the Shared Services Agreements shall   be paid in Cash on the Effective Date from Plan Cash, without the need to   file a proof of such Claim with the Bankruptcy Court in accordance with   Section 3.2(a) of the Plan and without further order of the Bankruptcy Court.   N/A (unclassified) Fee Claims Any Professional Person seeking allowance of a   Fee Claim shall file with the Bankruptcy Court its final application for   allowance of compensation for services rendered and reimbursement of expenses   incurred prior to the Effective Date and in connection with the preparation   and prosecution of such final application no later than forty-five (45)   calendar days after the Effective Date or such other date as established by   the Bankruptcy Court. Objections to such Fee Claims, if any, must be filed   and served no later than sixty-five (65) calendar days after the Effective   Date or such other date as established by the Bankruptcy Court. N/A   $15,000,000 100% 

    

 

13 Class   Description Treatment Entitled to Vote Estimated Amount of Claims in Class3   Estimated Recovery4 N/A (unclassified) U.S. Trustee Fees The Debtors or   Reorganized Debtors, as applicable, shall pay all outstanding U.S. Trustee   Fees of a Debtor on an ongoing basis on the date such U.S. Trustee Fees   become due, until such time as a final decree is entered closing the   applicable Chapter 11 Case, the applicable Chapter 11 Case is converted or   dismissed, or the Bankruptcy Court orders otherwise. N/A $300,000 100% N/A   (unclassified) Priority Tax Claims Except to the extent that a holder of an   Allowed Priority Tax Claim agrees to different treatment, each holder of an   Allowed Priority Tax Claim shall receive, in the Debtors’ or Reorganized   Debtors’ discretion, either: (a) on, or as soon thereafter as is reasonably   practicable, the later of the Effective Date and the first Business Day after   the date that is thirty (30) calendar days after the date a Priority Tax   Claim becomes an Allowed Claim, Cash in an amount equal to such Claim; or (b)   deferred Cash payments following the Effective Date, over a period ending not   later than five (5) years after the Petition Date, in an aggregate amount   equal to the Allowed amount of such Priority Tax Claim (with any interest to   which the holder of such Priority Tax Claim may be entitled calculated in   accordance with section 511 of the Bankruptcy Code); provided, however, that   all Allowed Priority Tax Claims that are not due and payable on or before the   Effective Date shall be paid in the ordinary course of business as they   become due. N/A $100,000 100% Class 1 Priority Non-Tax Claims The legal,   equitable and contractual rights of the holders of Priority Non-Tax Claims   are unaltered by the Plan. Except to the extent that a holder of an Allowed   Priority Non-Tax Claim agrees to a different treatment, on the applicable   Distribution Date, each holder of an Allowed Priority Non-Tax Claim shall   receive Cash from the applicable Reorganized Debtor in an No (Presumed to   accept) $50,000 100% 

    

 

14 Class   Description Treatment Entitled to Vote Estimated Amount of Claims in Class3   Estimated Recovery4 amount equal to such Allowed Claim. Class 2 Other Secured   Claims The legal, equitable and contractual rights of the holders of Other   Secured Claims are unaltered by the Plan. Except to the extent that a holder   of an Allowed Other Secured Claim agrees to a different treatment, on the   applicable Distribution Date each holder of an Allowed Other Secured Claim   shall receive, at the election of the Reorganized Debtors: (i) Cash in an   amount equal to such Allowed Claim; or (ii) such other treatment that will   render such Other Secured Claim unimpaired pursuant to section 1124 of the   Bankruptcy Code; provided, however, that Other Secured Claims incurred by a   Debtor in the ordinary course of business may be paid in the ordinary course   of business in accordance with the terms and conditions of any agreements   relating thereto, in the discretion of the applicable Debtor or Reorganized   Debtor without further notice to or order of the Bankruptcy Court. Each   holder of an Allowed Other Secured Claim shall retain the Liens securing its   Allowed Other Secured Claim as of the Effective Date until full and final   satisfaction of such Allowed Other Secured Claim is made as provided in the   Plan. On the full payment or other satisfaction of each Allowed Other Secured   Claim in accordance with the Plan, the Liens securing such Allowed Other   Secured Claim shall be deemed released, terminated and extinguished, in each   case without further notice to or order of the Bankruptcy Court, act or   action under applicable law, regulation, order or rule or the vote, consent,   authorization or approval of any Person. No (Presumed to accept) $0 100%   Class 3 Bridge Loan The Bridge Loan Claims shall be Allowed under the Plan,   and shall not Yes $77,500,000 100% 

    

 

5 The   Bankruptcy Code provides that an oversecured creditor is entitled to   postpetition interest on its claim. See 11 U.S.C. § 506(b). Accordingly, because   the Bridge Loan Lenders are oversecured creditors (i.e., the value of the   collateral securing the Bridge Loan Claims greatly exceeds the value of such   claims), the Plan provides that the New Money Bridge Loan Claim (see Plan at   § 1.97) and the Roll Up Loan Claim (see Plan at § 1.144) shall include   accrued and unpaid fees and interest through the Effective Date. 6 This   amount assumes no reduction on account of any Prepetition Shared Services   Adjustments plus the Prepetition Transaction Proceeds Adjustment. 15 Class   Description Treatment Entitled to Vote Estimated Amount of Claims in Class3   Estimated Recovery4 Claims be subject to any avoidance, reductions, setoff,   offset, recoupment, recharacterization, subordination (whether equitable,   contractual, or otherwise), counterclaims, cross-claims, defenses,   disallowance, impairment, objection, or any other challenges under any   applicable law or regulation by any Person. Except to the extent that a   holder of a Bridge Loan Claim agrees to different treatment with respect to   such holder’s Claim, on the applicable Distribution Date, or as soon as   practicable thereafter, each holder of a Bridge Loan Claim shall receive,   subject to the terms of the Plan, in full and final satisfaction, settlement,   release and discharge of its Bridge Loan Claim: (i) New Money Bridge Loan   Claim: receipt of New Term Loan Facility Obligations on a dollar for dollar   basis on account of its New Money Bridge Loan Claim. (ii) Roll Up Loan Claim:   receipt of New Convertible Notes on a dollar for dollar basis on account of   its Roll Up Loan Claim.5 Class 4 Novelion Intercompany Loan Claims The   Novelion Intercompany Loan Claim shall be Allowed under the Plan, and shall   not be subject to any avoidance, reductions, setoff, offset, recoupment, recharacterization,   subordination (whether equitable, Yes $36,340,1736 83.5% 

    

 

16 Class   Description Treatment Entitled to Vote Estimated Amount of Claims in Class3   Estimated Recovery4 contractual, or otherwise), counterclaims, cross-claims,   defenses, disallowance, impairment, objection, or any other challenges under   any applicable law or regulation by any Person. Except to the extent that the   holder of the Novelion Intercompany Loan Claim agrees to different treatment,   on the applicable Distribution Date, or as soon as practicable thereafter,   the holder of the Novelion Intercompany Loan Claim shall receive, in full and   final satisfaction, release and discharge of the Novelion Intercompany Loan   Claim, the Class 4 New Common Stock Distribution. For the avoidance of doubt,   in satisfaction of the Novelion Intercompany Loan Claim in accordance with   Section 5.4 of the Plan, Novelion shall waive and release any and all Other   Novelion Claims, and Novelion shall not be entitled to any distribution or   consideration on account thereof, except as provided in the Shared Services   Agreements pursuant to Section 7.16 of the Plan. Class 5 Government   Settlement Claims Except to the extent that a holder of a Government   Settlement Claim agrees to a different treatment, Government Settlement   Claims shall be unimpaired by the Plan and shall remain obligations of the   Reorganized Debtors to the extent not satisfied and/or paid on or before the   Effective Date. The Government Settlement Agreements shall be deemed assumed   by the Debtors, and binding upon the Reorganized Debtors and the applicable   parties thereto as of and following the Effective Date (provided that the   foregoing shall not constitute a determination whether such agreements are   executory contracts subject to section 365 of the Bankruptcy Code).   Notwithstanding the foregoing, and unless the applicable parties to the No   (Presumed to accept) $22,700,000 100% 

    

 

7 The   governmental units that are parties to the Government Settlement Agreements   have not at this time sought to accelerate or increase payments under those   agreements as a result of the filing of these Chapter 11 Cases or the   consummation of the transactions contemplated by the Plan and the Plan   Documents. However, the parties to the Government Settlement Agreements   reserve all rights under those agreements, including all rights regarding   acceleration, at this time. The Debtors and certain of the governmental units   that are parties to the Government Settlement Agreements are in discussions   regarding the intentions of those parties regarding acceleration of the   Debtors’ payment obligations under the Government Settlement Agreements. The   Debtors and these parties to the Government Settlement Agreements anticipate   reaching resolution on this issue before the Plan is confirmed. 8 This amount   includes estimated Cure Amounts related to Ongoing Trade Claims. 17 Class   Description Treatment Entitled to Vote Estimated Amount of Claims in Class3   Estimated Recovery4 Government Settlement Agreements object in writing to   such treatment prior to the deadline established by the Bankruptcy Court to   object to confirmation of the Plan, the monetary obligations under the   Government Settlement Agreements shall not be accelerated or increased as a   result of the commencement of the Chapter 11 Cases or the consummation of the   transactions contemplated by the Plan, the Plan Funding Agreement and/or the   other Transaction Documents, including the occurrence of any Fundamental   Transaction (as defined in the Government Settlement Agreements), by virtue   of the consummation of any such transactions or the failure of the New Common   Stock of the Plan Investor to be listed on the NASDAQ or other US stock   exchange. Nothing in the foregoing paragraph affects or limits the provisions   of Section 12.6(d)-(e) of the Plan.7 Class 6A Ongoing Trade Claims Except to   the extent that a holder of an Allowed Ongoing Trade Claim agrees to a   different treatment, on the applicable Distribution Date each holder of an   Allowed Ongoing Trade Claim shall, at the election of the Reorganized   Debtors, and to the extent that such Allowed Ongoing Trade Claim was not   previously paid pursuant to an order of the Bankruptcy Court: No (Presumed to   accept) $12,000,0008 100% 

    

 

9 This amount   does not include (a) estimated Claims based on damages arising from the   rejection of an executory contract or unexpired lease, or (b) estimated   contingent or unliquidated Claims. 10 This estimation (a) assumes that the   DIP facility will be drawn in the currently projected amount and that the DIP   Claims will be paid in full in New Convertible Notes on the Effective Date   pursuant to Section 3.1 of the Plan, and (b) is based on the Debtors’ books   and records. The deadline for filing proofs of claim against the Debtors is   July 3, 2019, and it is possible that the ultimate allowed amount of claims   may be materially different than the Debtors’ estimate. The Debtors currently   are engaged in the process of reviewing the 89 proofs of claim that were   asserted prior to the general bar date. 18 Class Description Treatment   Entitled to Vote Estimated Amount of Claims in Class3 Estimated Recovery4 (i)   be paid in full in Cash on the applicable Distribution Date, plus   postpetition interest at the Applicable Interest Rate, computed daily from   the Petition Date through the Effective Date, from Plan Cash, (ii) as to any   Ongoing Trade Claim incurred in the ordinary course of business and on normal   credit terms where payment comes due following the Effective Date, receive   such treatment that leaves unaltered the legal, equitable, or contractual   rights to which the holder of such Allowed Ongoing Trade Claim is entitled,   or (iii) such other treatment that would render such Ongoing Trade Claim   Unimpaired. Class 6B Other General Unsecured Claims Except to the extent that   a holder of an Allowed Other General Unsecured Claim agrees to less favorable   treatment, each holder of an Allowed Other General Unsecured Claim shall   receive, on the applicable Distribution Date and in full and final   satisfaction, settlement and release of such Allowed Other General Unsecured   Claim, its Pro Rata Share of: (i) New Convertible Notes in the principal   amount of $125,000,000 less the portion of New Convertible Notes distributed   to (x) holders of DIP Claims (to the extent the DIP Claims are not repaid in   full in Cash and receive a distribution of New Convertible Notes pursuant to   Section 3.1 of the Plan), and (y) the holders of Roll Up Loan Claims pursuant   to Section 5.3(a)(ii) of the Plan; and (ii) Yes $305,000,000 9 80.7%10 

    

 

The recoveries   set forth above are estimates and are contingent upon approval of the Plan as   proposed. ARTICLE III. BUSINESS DESCRIPTION; HISTORICAL INFORMATION 3.1.   General Background, History and Key Product Lines. The Debtors, together with   their non-Debtor affiliates, including their non-Debtor-parent Novelion   Therapeutics Inc. (collectively, the “Company”), comprise a rare-disease   biopharmaceutical company dedicated to developing and commercializing   prescription drug products for individuals living with rare diseases.   Headquartered in Cambridge, Massachusetts, the Debtors maintain operations in   the United States, Canada, Europe, certain countries in Latin America and   Japan. While the Debtors derive the majority of their revenue from sales in   the United States, the Debtors also generate revenues, directly or through   third party distributors and other providers, from countries in the European   Union, Turkey and Latin America, among others, and outlicense11 their   products in certain jurisdictions in exchange for royalties or other   payments. 11 The Debtors own and license intellectual property rights to   certain drugs. “Outlicensing” refers to arrangements in which the Debtors   license these rights to third parties, who then sell the drug. The Debtors   regularly obtain protection for their products and proprietary technology by   means of U.S. and foreign patents, trademarks, and contractual arrangements.   As of the Petition Date, the Debtors own or hold licenses to many U.S. and   foreign patents and trademarks, and have a variety of U.S. and foreign patent   applications pending. 19 Class Description Treatment Entitled to Vote   Estimated Amount of Claims in Class3 Estimated Recovery4 the Class 6B New   Common Stock Distribution (including any New Common Stock issuable upon   exercise of the New Warrants). Class 7 Existing Securities Law Claims Holders   of Existing Securities Law Claims shall not receive or retain any   distribution under the Plan on account of such Existing Securities Law   Claims. No (Deemed to reject) $0 0% Class 8 Existing Interests Existing   Interests shall be discharged, cancelled, released and extinguished, and   holders thereof shall not receive or retain any distribution under the Plan   on account of such Existing Interests. No (Deemed to reject) N/A 0% 

    

 

On November 29,   2016, Aegerion entered into a merger transaction with non-Debtor Novelion   Therapeutics Inc. (formerly QLT Inc.) (“Novelion”), a publicly-traded company   formed under the laws of the Province of British Columbia. As a result of   that transaction, Aegerion became an indirect wholly-owned subsidiary of   Novelion. Aegerion serves as the operating business of the Company and   substantially all of the assets and operations reside at Aegerion and its   non-debtor foreign subsidiaries. As discussed in more detail below, through   Aegerion, the Company develops and commercializes two products — lomitapide   and metreleptin — which treat individuals with rare diseases. Despite the   Company’s global presence, the majority of its revenue is derived from the   sale of these drugs in the United States. For example, in 2018 the Company’s   net revenues from lomitapide and metreleptin were approximately $130.4   million (of which $96 million was attributable to the Debtors). $83.4 million   of the net revenue was derived from prescriptions written in the United   States with the remainder derived from sales and royalties on sales outside   of the U.S. i. Lomitapide. The Debtors’ first product, lomitapide, is a   cholesterol-lowering drug designed to treat patients, on an adjunct basis,   with a rare disease: homozygous familial hypercholesterolemia (“HoFH”).   Lipids are a variety of naturally occurring fats that serve important   biological functions, including energy storage, signaling and acting as   structural components of cell membranes. Within the class of lipids is   cholesterol. HoFH is a serious, rare genetic disease that impairs the   function of the receptor responsible for removing low-density lipoprotein   cholesterol (i.e., bad cholesterol) from blood. An impairment of the low   density lipoprotein receptor function results in significant elevation of   blood cholesterol levels, which can be the source of several diseases for   HoFH patients. For example, patients with HoFH often develop premature and   progressive atherosclerosis (i.e., a narrowing or blocking of the arteries)   and are at a very high risk of experiencing premature cardiovascular events,   such as heart attack or stroke. Lomitapide is marketed in the United States   under the brand name JUXTAPID. Following regulatory approval, Aegerion   launched JUXTAPID in the United States in 2013. The drug is also approved in   the European Union, Japan, Canada, Colombia, and Argentina, among other   countries. The Debtors also supply lomitapide on a named patient sales basis   in countries, such as Brazil, where such sales are permitted before   regulatory approval in such country as a result of approval in the U.S. or   EU.12 The Debtors also receive sales milestones and royalties on net sales of   lomitapide in the European Union and certain other jurisdictions from Amryt   Pharma Plc (i.e., the Plan Investor) to whom, as more fully described below,   Aegerion outlicenses the rights to commercialize the product in those   jurisdictions. As discussed in more detail below, the Debtors also licensed   the exclusive rights to commercialize JUXTAPID in Japan to Recordati Rare   Diseases Inc. for the current marketed indication (in addition to an   exclusive right of first negotiation to any new indications that may be   developed by Aegerion), in 12 In August 2018, the Company filed for marketing   authorization in Brazil for JUXTAPID and anticipates approval in 2019. 20 

    

 

exchange for an   upfront payment and various milestone and royalty payments for net sales in   Japan. The Company generated net revenues from sales of lomitapide of   approximately $59.1 million in 2018 ($41.6 million of which was attributable   to the Debtors), which marked a $12.9 million decline from the previous year.   As discussed in more detail below, this decline was primarily attributable to   the availability of competing products (known as “PCSK9 inhibitors”) in the   marketplace, restrictions on insurance reimbursement, and patients not   adhering to the lomitapide therapy. ii. Metreleptin. The Debtors acquired   their second product, metreleptin, in January 2015 pursuant to an asset   purchase agreement with Amylin Pharmaceuticals, LLC and AstraZeneca   Pharmaceuticals LP. Metreleptin is a recombinant analog of human leptin   designed to treat the complications of leptin deficiency in patients with   lipodystrophy. Lipodystrophy is the medical disease involving an abnormal   distribution of fat in the body which can lead to an abnormal accumulation of   fat tissue, lipotoxicity, organ damage, and extreme insulin resistance and   associated complications. As a result of the deficiency of leptin associated   with lipodystrophy, patients experience fatigue and unregulated appetite,   among other abnormalities, which are typically resistant to conventional   treatments. There are two forms of lipodystrophy. Generalized lipodystrophy   (“GL”), which is characterized by a near complete lack of adipose tissue and,   consequently, leads to early and significant morbidity and mortality.   Differentiation of GL (versus partial lipodystrophy, “PL”) is made based on   the anatomical distribution of fat loss, which is widespread in GL patients,   as well as the younger age and greater rapidity of onset and severity of the   metabolic abnormalities. The severe metabolic abnormalities associated with   GL may result in premature diabetic nephropathy, retinopathy, cardiomyopathy,   recurrent attacks of acute pancreatitis, hepatomegaly, and organ failure.   These complications themselves increase morbidity and mortality due to their   known long term impacts. The other form of lipodystrophy is PL, which is characterized   by a less uniform loss of fat cells and with a later age of onset. There can   be considerable heterogeneity in the extent of fat cell loss, levels of   leptin, and degree of metabolic abnormalities. In PL patients with relative   or near complete leptin deficiency, the metabolic abnormalities and longer   impact on disease progression can closely mirror that of patients with GL.   Metreleptin is marketed in the United States under the brand name MYALEPT.   MYALEPT is approved in the U.S. as an adjunct to diet as replacement therapy   to treat the complications of leptin deficiency in patients with congenital   or acquired GL. Metreleptin is also approved in the European Union, where it   has been approved as an adjunct treatment to treat the complications of leptin   deficiency for patients with GL and PL.13 Metreleptin is also supplied   through expanded access programs in countries where permitted by applicable   law and generate revenues in certain markets, such as Brazil, where named   patient sales are permitted based on the approval of metreleptin in the U.S.   or EU. In 2018, the Company generated revenues from metreleptin of   approximately $71.4 million ($54.5 million of which was 13 The Company has   also submitted market access dossiers in key EU countries, including Germany.   21 

    

 

attributable to   the Debtors). The Debtors also receive royalties and other payments pursuant   to an outbound license with Shionogi & Co., Ltd., which has the rights,   through an outlicense, to commercialize metreleptin in Japan, South Korea and   Taiwan. 3.2. The Debtors’ Supply Chain & Regulatory Obligations. The   Debtors’ operations are extensively regulated, primarily by the United States   Food and Drug Administration (the “FDA”). The FDA imposes substantial   requirements on the clinical development, manufacture, and marketing of the   Debtors’ pharmaceutical products and product candidates. The FDA and other   federal, state and local agencies regulate the Debtors’ research and   development activities and many aspects of their products, including their   testing, packaging, distribution, labeling, and storage. Even after a drug is   approved by the FDA, the Debtors must comply with risk evaluation and   mitigation strategy requirements as well as other post-marketing requirements   imposed by the FDA, the Federal Anti-Kickback Statute, the federal False   Claims Act, and other state and federal laws and regulations governing   prescription drug manufacturers. The Debtors must also comply with laws   relating to, among other things, the marketing of their products, their   relationships with treating physicians, data protection, safe working   conditions, patient safety, and the transport of potentially hazardous   substances. The Debtors do not have any manufacturing capability. Rather,   they outsource the manufacturing of proprietary products to pharmaceutical   manufacturing facilities operated by third-party contractors. Outsourcing   manufacturing and distribution allows the Debtors to focus on the development   and commercialization of drugs, minimize fixed costs and capital   expenditures, and gain access to advanced manufacturing process capabilities   and expertise. The Debtors’ manufacturers are all approved by the FDA to   fabricate pharmaceutical products, and their facilities comply with, among   other regulations, the FDA’s Current Good Manufacturing Practices   regulations. The Debtors’ supply chain is comprised of several integral   phases: (a) storing master and working cell banks that form the starting   material for the Debtors’ metreleptin products; (b) manufacturing the raw   materials for the Debtors’ products (i.e., the active pharmaceutical   ingredients, or “API”); (c) contract manufacturing organizations (each a   “CMO”) manufacturing the API into consumable pharmaceuticals (i.e., dosage   forms and capsules in the case of lomitapide, or vials for injection in the   case of metreleptin); (d) API manufacturers, CMO’s and/or third-party vendors   testing the pharmaceuticals and conducting both analytical release and   stability studies; (e) packaging and labeling the commercial products for the   Debtors’ various markets; and (f) distribution through specialty pharmacies   to ensure that the Debtors’ commercial products make their way to end-users   (i.e., patients). Given the Debtors’ size, the Debtors also utilize   third-party vendors with considerable experience with and knowledge of the   Debtors’ products to (a) help the Debtors negotiate and obtain drug formulary   access, (b) provide critical third-party data on regions, doctors and market   activity, including wholesaler inventory and sales, to help the Debtors   increase market penetration, (c) consolidate and report internal data to   ensure compliance with federal and state regulations, (d) assist patients who   are experiencing difficulty gaining access to the Debtors’ products, and (e)   operate a critical call center for patients if they are experiencing any   issues or concerns with the Debtors’ products. 22 

    

 

In addition,   and in connection with the FDA approval of the Debtors’ products, the FDA   determined that the Debtors are required to conduct post-marketing studies   and clinical trials to continue gathering safety information about their   products. In fact, the Debtors are subject to post-marketing regulatory   requirements from the FDA governing the testing, labeling, packaging,   storage, advertising, promotion, recordkeeping and submission of safety   information for their products. Some of these requirements could have an   impact on the Debtors’ labeling, marketing authorizations or approval. 3.3.   Shared Services Agreements. In an effort to minimize costs and take advantage   of synergies, the Debtors entered into shared services agreements with   Novelion and its subsidiary Novelion Services USA, Inc., dated as of December   1, 2016, but effective as of November 29, 2016 (the “Shared Services   Agreements”), pursuant to which the Debtors provide to Novelion and Novelion   provides to the Debtors, certain services, including, but not limited to   administrative support, human resources, information technology support,   accounting, finance, and legal services. To facilitate the Proposed   Restructuring Transaction, the Debtors negotiated and executed an amendment   to the Shared Services Agreements, which the Debtors intend to assume   pursuant to a motion filed with the Bankruptcy Court [Docket No. 16].14 On   June 27, 2019, the Bankruptcy Court approved the motion on an interim basis   [Docket No. 151] (the “Shared Services Interim Order”). The Shared Services   Interim Order makes clear that nothing therein ratifies any prepetition   payments made by Aegerion thereunder, and all rights of the Committee with   respect to the agreements are preserved pending the outcome of the   Committee’s investigation (discussed in Section 10.15 below). Pursuant to   Section 7.16 of the Plan, the Shared Services Agreements shall terminate on   the Effective Date. Novelion and Novelion Services USA, Inc. filed proofs of   claim against the Debtors for approximately $7.6 million and $40 million on   account of intercompany amounts, shared services, and other claims. These claims   shall be treated as set forth in the Plan; provided, however, to the extent   the Plan is not confirmed, Novelion is entitled to pursue the full amount of   such claims against the Debtors and all parties to the RSA reserve all rights   with respect thereto. 14 While the Debtors originally sought to assume the   amended Shared Services Agreements on a final basis during the preliminary   stages of the Chapter 11 Cases, pursuant to an agreement with the Committee   [Docket No. 108] the Debtors agreed to seek interim authority to continue   operating under the Shared Services Agreements during the pendency of the   Chapter 11 Cases and to delay seeking authority to assume such agreements   until the expiration of the Committee’s challenge period under the DIP Order.   23 

    

 

3.4. Government   Investigations and Settlements. Aegerion has been the subject of several   investigations and legal proceedings relating to its marketing and sales   activities of JUXTAPID in the United States, compliance with the FDA-mandated   Risk Evaluation and Mitigation Strategy (“REMS”) program, compliance with the   Health Insurance Portability and Accountability Act (“HIPAA”), and statements   to securities markets regarding the prevalence of HoFH and other JUXTAPID   performance metrics. As explained more fully below, following numerous   settlements and judgments with various government agencies, Aegerion agreed   to pay approximately $40.1 million in aggregate penalties, plus interest,   over three years, and to implement a number of enhancements relating to Aegerion’s   compliance program and the implementation of the JUXTAPID REMS program.15 As   of the Petition Date, the remaining amount due under the government   settlements and judgments totaled approximately $26.5 million in the   aggregate with the Debtors’ installment payments scheduled to expire in   2021.16 Specifically, in 2013 Aegerion received a subpoena from the   Department of Justice regarding its marketing and sale of JUXTAPID in the   United States. In connection with the DOJ investigation, Aegerion entered into   a Plea Agreement (the “Plea Agreement”), a Deferred Prosecution Agreement   (the “DPA”), a civil settlement agreement, certain state settlement   agreements, a Consent Decree of Permanent Injunction (the “FDA Consent   Decree”), and a Corporate Integrity Agreement (the “CIA”) with the Department   of Human Services Officer of the Inspector General (“OIG”). Under the   court-approved Plea Agreement, Aegerion pled guilty to two misdemeanor   misbranding violations of the Federal Food, Drug, and Cosmetic Act (“FDCA”) and   on February 27, 2018, following a hearing on January 30, 2018, a U.S.   District Court Judge accepted Aegerion’s plea and sentenced Aegerion. The   court did not impose a criminal fine and instead ordered Aegerion to pay   restitution, in the amount of $7.2 million payable over three years, plus   interest on any unpaid balance at a rate of 1.75% per annum, into a fund   managed by an independent claims administrator. Approximately $3.3 million   remained due under the Plea Agreement as of the Petition Date. As part of the   court order, Aegerion was sentenced to a three year term of probation,   requiring Aegerion to, among other things, comply with the DPA (pursuant to   which Aegerion must cooperate with the DPA and the FDA Consent Decree, each   as further described below) and the CIA (as further described below). 15 The   settlements did not resolve government investigations into and lawsuits   against certain individuals, investigations into certain of Aegerion’s   donations to patient assistance programs, or investigations into whether   Aegerion’s activities in Brazil violated the Foreign Corrupt Practices Act.   16 In addition, under certain circumstances, Aegerion is required under its   bylaws, indemnification agreements and/or other documents (e.g.,   undertakings) to advance reasonable legal costs and expenses of certain   former executives and directors in connection with such investigations and   lawsuits and to indemnify such officers and directors. Within the discretion   of its board of directors, Aegerion was similarly permitted to indemnify and   advance reasonable costs and expenses to certain non-officer employees.   Pursuant to the terms of the Plan, the Debtors are rejecting such commitments   going forward and, in accordance with Section 5.7 of the Plan, holders of   Claims arising out of such obligations shall be treated as part of Class 6B   (Other General Unsecured Claims). 24 

    

 

Under the terms   of the DPA with the DOJ, Aegerion admitted to engaging in conduct that   constituted a conspiracy to violate HIPAA. The DPA provides that Aegerion   must continue to cooperate fully with the DOJ concerning its investigation   into other individuals or entities. The DPA also provides that Aegerion must   maintain a robust compliance and ethics program that includes significant certification,   training, monitoring, and other requirements. Aegerion, as well as the Board   of Directors of the Company (or a designated committee thereof), must also   conduct regular reviews of Aegerion’s compliance and ethics program, provide   certifications to the DOJ that the program is believed to be effective, and   notify the DOJ of any probable violations of HIPAA. Aegerion also entered   into a consent decree with the DOJ and the FDA to resolve a separate civil   complaint alleging that Aegerion violated the FDCA by failing to comply with   the JUXTAPID REMS program and the requirement to provide adequate directions   for all of the uses for which it distributed JUXTAPID. The FDA Consent Decree   requires Aegerion to, among other things: comply with the JUXTAPID REMS program;   retain a qualified independent auditor to conduct annual audits of its   compliance with the JUXTAPID REMS program; and remediate any noncompliance   identified by the auditor within specified timeframes. The FDA Consent Decree   was approved and entered by the relevant court on March 20, 2019. Aegerion   separately entered into the CIA with OIG, which requires Aegerion to, among   other things: maintain a robust compliance program with significant   requirements relating to training, monitoring, annual risk assessment and   mitigation processes; independent review of Aegerion’s compliance and other   activities; a disclosure program; and an executive financial recoupment   program. Under the CIA, Aegerion, as well as the Board of Directors of the   Company (or a designated committee thereof), must also conduct regular   reviews of Aegerion’s compliance program and provide an annual resolution or   certification to OIG that the program is believed to be effective. Further,   Aegerion has additional certification and reporting obligations under the CIA   related to its compliance with federal healthcare programs, FDA requirements,   and the CIA itself. In 2014, the SEC issued a subpoena as well, and   subsequently filed a complaint against Aegerion alleging securities   violations related to statements made by Aegerion regarding the conversion   rate for JUXTAPID prescriptions. On September 25, 2017, a court entered a   final judgment with the SEC, which imposed a civil penalty in the amount of   $4.1 million to be paid in installments over three years, plus interest,   approximately $1.2 million of which remained due as of the Petition Date. In   addition to the criminal settlement and plea agreement and the SEC final   judgment, Aegerion also entered into a civil settlement agreement with the DOJ   (the “DOJ Civil Settlement Agreement”) to resolve allegations that false   claims for JUXTAPID were submitted to governmental healthcare programs. The   settlement requires Aegerion to pay a civil fine in the amount of $28.8   million (which includes up to $4.9 million designated for relators who had   commenced a civil qui tam action against the Debtors, as described below, and   up to $2.7 million designated for certain states to resolve claims under   state law analogues to the federal False Claims Act) to be paid in   installments over three years, plus interest, approximately $22 million of   which remained due as of the Petition Date. In connection with the DOJ Civil   Settlement 25 

    

 

Agreement,   Aegerion also entered into separate settlement agreements with twenty-eight   state agencies to resolve claims under state law analogues to the federal   False Claims Act. The terms of the state settlement agreements are   substantially similar to those set forth in the DOJ Civil Settlement   Agreement. Finally, in March 2014, an amended qui tam complaint was filed in   the District of Massachusetts against Aegerion and certain former executive   officers and employees.17 Following resolution of the government settlements   described above, a second amended complaint was filed against Aegerion,   naming additional individuals as defendants. Pursuant to the DOJ Civil   Settlement Agreement, on February 20, 2018 the complaint against Aegerion was   dismissed, though the lawsuit remains ongoing as to other defendants. The   governmental units that are parties to the Government Settlement Agreements   have not at this time sought to accelerate or increase payments under those   agreements as a result of the filing of these Chapter 11 Cases or the   consummation of the transactions contemplated by the Plan and the Plan   Documents. However, the parties to the Government Settlement Agreements   reserve all rights under those agreements, including all rights regarding   acceleration, at this time. 3.5. Debtors’ Prepetition Capital Structure. As   of the Petition Date, the Debtors had approximately $450 million of   consolidated outstanding indebtedness, which includes approximately $414   million of institutional debt that matures in 2019. The components of the   Debtors’ outstanding indebtedness are summarized below. (a) Convertible   Notes. In August 2014, Aegerion entered into that certain Indenture (as   amended, restated or otherwise modified) with The Bank of New York Mellon, as   indenture trustee, pursuant to which Aegerion issued 2% senior unsecured   convertible notes in the original aggregate principal amount of $325 million   due [August 15, 2019] (the “Convertible Notes”). The principal amount was   subsequently reduced to $302.5 million upon consummation of the Roll Up Loan   (as defined below) under the Bridge Loan facility, as described in more   detail below. As of the Petition Date, approximately $304.1 million remained   outstanding under the Convertible Notes, including interest and fees. (b)   Novelion Intercompany Loan. In connection with Novelion’s merger with Aegerion,   on June 14, 2016 Aegerion and Novelion entered into that certain Loan and   Security Agreement (as amended, restated or otherwise modified, including   that certain Amended and Restated Loan and Security Agreement dated as of   March 15, 2018, the “Novelion Intercompany Loan Credit Agreement”), pursuant   to which Novelion provided a senior secured term loan to Aegerion in the   principal amount of $40 million, bearing paid-in-kind interest at 8% and   maturing on July 1, 2019 (the “Novelion 17 The initial qui tam complaint was   filed under seal in July 2013. 26 

    

 

Intercompany   Loan”). The Novelion Intercompany Loan is secured by, among other things,   Aegerion’s intellectual property and all of Aegerion’s equity interests   (including up to 65% of Aegerion’s equity interests of any first-tier foreign   subsidiary). In November 2018, the terms of the Novelion Intercompany Loan   Credit Agreement were amended further in connection with the closing of the   Bridge Loan (as defined below). As of the Petition Date, approximately $36.1   million remained outstanding under the Novelion Intercompany Loan, including   interest and fees. (c) Bridge Loan. On November 8, 2018, Aegerion entered   into that certain Bridge Credit Agreement (as amended, restated or otherwise   modified, the “Bridge Loan Credit Agreement”) with certain funds managed by   Highbridge Capital Management, LLC and Athyrium Capital Management, LP as   lenders (the “Bridge Loan Lenders”), Cantor Fitzgerald Securities as agent,   Aegerion as borrower, and Debtor Aegerion Pharmaceuticals Holdings, Inc. as   guarantor. Pursuant to the Bridge Loan Credit Agreement, the Debtors borrowed   secured first lien term loans in the aggregate principal amount of $50   million (collectively, the “New Money Bridge Loan”) and $22.5 million of   secured term loans that were funded to repurchase and retire, at par, an   equal amount of Convertible Notes held by the Bridge Loan Lenders   (collectively, the “Roll Up Loan” and together with the New Money Bridge   Loan, the “Bridge Loan”). The New Money Bridge Loan accrues interest at the   rate of 11% per annum and the Roll Up Loan accrues interest at the rate of 2%   per annum. Interest accrues and compounds quarterly in arrears and is not   payable in cash until maturity. The Bridge Loan is secured by a lien on   substantially all of the assets of the Debtors, including a pledge of 65% of   the obligors’ first-tier foreign subsidiaries’ equity interests and   substantially all of the intellectual property and related rights in respect   of MYALEPT and JUXTAPID, subject to certain exclusions set forth in the   governing documents. The liens granted to secure the obligations under the   New Money Bridge Loan are senior to the liens granted to secure the Debtors’   obligations under the Novelion Intercompany Loan, however, the liens granted   to secure the Roll Up Loan are junior to those granted under the Novelion   Intercompany Loan. In addition to working capital needs, the proceeds of the   Bridge Loan were used to: (a) repurchase and cancel certain Convertible Notes   with the proceeds of the Roll Up Loan; (b) retire, at par, the amounts   outstanding under a secured term loan provided to Aegerion by certain former   shareholders of the Company, in an aggregate principal amount of   approximately $21.2 million (the “Shareholder Term Loan”); and (c) repay $3.5   million of principal on the Intercompany Loan. Moreover, upon consummation of   the Bridge Loan, Novelion, as lender, (a) consented to the Debtors’   incurrence of the Bridge Loan and repayment of the Shareholder Term Loan, (b)   amended the Intercompany Credit Agreement, and (c) entered into an   intercreditor agreement pursuant to which (i) the Intercompany Loan and   related liens are subordinated to the New Money Loan, (ii) the Intercompany   Loan and related liens are senior to the Roll Up Loan, and (iii) the Bridge   Lenders agreed not to challenge $25 million of the Intercompany Loan amount.   27 

    

 

The Bridge Loan   had an initial maturity of February 15, 2019, subject to the Debtors’ right   to extend. On January 31, 2019, Aegerion sent notice to the agent under the   Bridge Loan Credit Agreement electing to extend the initial maturity date to   June 30, 2019, as permitted under and in accordance with the terms of the   Bridge Loan Credit Agreement. As of the Petition Date, approximately $73.8   million remained outstanding under the Bridge Loan, including interest and   fees. (d) Trade Claims. In addition to the Debtors’ funded debt, the Debtors   estimate that, as of the Petition Date, they had approximately $12 million in   unpaid trade and other ordinary course obligations. (e) Equity Ownership.   Novelion, the Debtors’ non-Debtor ultimate parent, owns 100% of the   outstanding equity interests in Aegerion. As of the Petition Date, Novelion   had 19,017,310 shares of common stock outstanding, which are listed on   NASDAQ. ARTICLE IV. EVENTS LEADING TO CHAPTER 11 FILING Despite the revenues   generated from the Debtors’ underlying products and management’s best efforts   to stabilize operations, the Debtors’ business performance has significantly   declined in recent years. Several factors contributed to the Debtors’ recent   struggles. First, the Debtors formerly engaged in practices denounced by the   DOJ and SEC, incurring substantial fines and exposing the Debtors to ongoing   litigation, which led to a corresponding decline in revenues and   profitability. Due to these past practices, the Debtors have significant   ongoing legal costs in the form of $40.1 million of fines imposed under the   DOJ and SEC settlements (approximately $26.4 million of which remained   outstanding as of the Petition Date) that have placed a significant financial   burden on the Debtors. As a result of the government settlements, Aegerion   must also comply with a series of rigorous compliance obligations   commensurate with the admissions it made during the investigations and the   conduct at issue in the investigations. To date, Aegerion has timely made all   settlement payments on their respective due dates. The results of the   government investigations have appropriately limited the marketplace for   JUXTAPID to adult HoFH patients, as required by the prescribing information   for JUXTAPID, which, along with the introduction of PCSK9 inhibitors, as   described below, has dramatically reduced the number of patients in the U.S.   on JUXTAPID in recent years. The investigations also had other adverse   effects, including: reputational harm; diverted resources (both in terms of   people and costs) away from developing and commercializing products;   increased compliance obligations and requirements; increased government,   industry and public scrutiny and criticism; reduced physicians’ inclinations   to prescribe the Debtors’ products; diverted management’s attention away from   operating the 28 

    

 

business; and   resulted in employee attrition and, similarly, made it more difficult to   attract qualified employees. Second, the pharmaceutical industry is highly   competitive and is characterized by rapidly changing markets and technology,   emerging industry standards and frequent introduction of new products. In   particular, the market for cholesterol lowering therapeutics is large and   competitive with many drug classes. Most significantly, the introduction of   PCSK9 inhibitors in the United States in 2015 (which are much less expensive   and have fewer side effects than lomitapide) has, along with attrition of   patients who were likely not HoFH patients, dramatically impacted sales of   JUXTAPID. Since that time, healthcare professionals have been placing substantially   all newly-diagnosed HoFH patients on a PCSK9 inhibitor product before   prescribing JUXTAPID. In fact, many healthcare payers require as a condition   precedent that HoFH patients have not achieved an adequate cholesterol   response on PCSK9 inhibitor products before access to JUXTAPID is approved.   Moreover, while MYALEPT is the only product approved in the United States for   the treatment of leptin deficiency in patients with GL, there are a number of   other approved therapies to treat these complications independently (that are   not specific to generalized lipodystrophy). In addition, both JUXTAPID and   MYALEPT are subject to enhanced REMS programs, which are FDA drug safety   programs that impose certification, counseling, prescription and   documentation requirements, which increase the steps necessary for patients   to enroll onto these therapies and may delay or impact patients starting or   staying on these therapies. Also, both of these products treat very rare   diseases and are not widely prescribed. Thus, any decline in the number of   patients or adherence to prescribed dosages is magnified. The competitive   effects and dynamics described above exacerbate the challenges for rare   disease products given the very limited pool of patients who are eligible for   treatment with these products. Third, the Debtors have been unable to replace   key revenue generators. The Debtors’ business depends on the success of only   two commercial products. Hampered by the restrictions set forth above, among   others, and the cost and operational structure that has historically been   misaligned with revenues, the Company has incurred losses each year since   inception, having suffered a net loss of $103.8 million in 2018 alone. Such   losses created a vicious cycle — as operations deteriorated, the Debtors were   unable to deploy sufficient operating and management resources associated   with developing and commercializing their existing products, or exploring new   revenue-generating products. While the Debtors took many steps to increase   revenues and limit losses, the Debtors were unable to generate sufficient   profits and revenues to prevent their bankruptcy filing and to restructure   their substantial debt outside of bankruptcy. Fourth, the Debtors have   substantial indebtedness under their long-term credit facilities. As of the   Petition Date, the Debtors’ capital structure has approximately $414 million   of consolidated outstanding indebtedness related to the Debtors’ credit   facilities, a significant portion of which is secured by liens on   substantially all assets of the Debtors, and all of which matures in 2019. 29   

    

 

4.1. Debtors’   Efforts to Negotiate a Comprehensive Restructuring. With the concerns   discussed above in mind, and with an impending liquidity crisis at the   Debtors, the Debtors retained the following advisors to assist the Debtors   with respect to refinancing and restructuring alternatives: in late 2017,   Moelis & Company LLC (“Moelis”) to explore potential sale transactions   (and subsequently, in September 2018, as investment banker in connection with   the Proposed Restructuring Transaction); in early 2018, Willkie Farr &   Gallagher LLP as counsel; and in August 2018, AlixPartners, LLP as   restructuring advisor (and subsequently, in February 2019, as Chief   Restructuring Officer).18 With the aid of their advisors, the Debtors began   exploring and evaluating strategic business opportunities to enhance   liquidity, including debt refinancing, cost savings initiatives,   proceeds-generating transactions (such as the divestiture or outlicense of   certain assets), mergers and acquisitions activities, and other strategic   opportunities. Given, among other things, their substantial leverage, the   near term liquidity issues and the continuing pressure on the Debtors’   business and the related impact on retention of key personnel, in early 2018   the Debtors, in consultation with their advisors, conducted a comprehensive   liquidity analysis and considered several potential restructuring   alternatives, including a refinancing of the Convertible Notes. In conjunction   therewith, in March 2018 the Debtors entered into the $20 million Shareholder   Term Loan, which provided funds for ongoing development of metreleptin in   additional indications and for general corporate purposes. After negotiations   to refinance the Convertible Notes fell apart, the Debtors determined that a   targeted sales process was the best option to maximize value for all   stakeholders. To that end, in or around June 2018, Moelis commenced a   targeted marketing process, focused on those potential acquiring parties for   which the Debtors’ business represented a strategic opportunity and that   possessed the capability of entering into and consummating a transaction. In   addition, during 2018, the Debtors pursued significant cost-saving   initiatives and business opportunities to enhance liquidity, including (a) a   cost reduction plan initiated in January 2018, and (b) a more significant   workforce reduction in August 2018 designed to streamline the Company’s   business, deliver profitability and limit negative impact on revenue growth,   yet extend its cash runway. The reduction in workforce eliminated 39   employees, which accounted for 36% of the Company’s global workforce. While   this reduced overhead expenses, the initiative also resulted in the loss of   long-term employees with institutional knowledge and expertise, depleted   commercial resources, and also suspended many key clinical development   activities. With the prospects of facing a potential liquidity crisis in late   2018 despite management’s ongoing efforts, and with a comprehensive capital   restructuring out of reach, the Debtors engaged in negotiations with several   parties, including the majority holders of the Convertible Notes (Highbridge   and Athyrium), about the possibility of providing interim financing to provide   sufficient breathing room to implement a restructuring transaction. Following   an extensive marketing process, the Debtors consummated the Bridge Loan in 18   The Debtors also engaged other financial advisors during this time in   connection with their restructuring efforts, however, such advisors are no   longer engaged by the Debtors. 30 

    

 

November 2018.   During this time, AlixPartners also worked with management to update the   Debtors’ multi-year projections, budget and business plan to facilitate   detailed engagement with the Debtors’ primary stakeholders. In addition, and   pursuant to a formal process, on February 5, 2019, the Debtors entered into a   license agreement with Recordati Rare Diseases Inc. to grant the exclusive   rights to commercialize JUXTAPID in Japan to Recordati for the current   marketed indication for HoFH (in addition to an exclusive right of first   negotiation to any new indications that may be developed by Aegerion) in   exchange for an upfront payment of $25 million and various milestone and   royalty payments for net sales in Japan.19 The upfront payment, coupled with   the proceeds of the Bridge Loan, provided the Debtors with necessary working   capital and extended the runway to consummate a restructuring transaction.   During the first quarter of 2019, the Debtors and their advisors resumed   detailed restructuring discussions with various stakeholders in the capital   structure, which included Novelion, the Bridge Lenders, and certain potential   strategic M&A partners. Following an extensive, months-long multi-track   negotiation process, the Debtors entered into an exclusivity agreement with   one of the interested parties — Amryt Pharma Plc (“Amryt” or the “Plan   Investor”).20 Ultimately, the Debtors determined that the most value-maximizing   approach was to proceed with a restructuring involving an all-stock   investment by the Plan Investor through a chapter 11 restructuring in   exchange for which the Plan Investor would receive 100% of the equity of   Aegerion (the “Proposed Restructuring Transaction”). 19 Pursuant to the terms   of the Bridge Loan Credit Agreement, (a) Aegerion was entitled to retain $15   million of the upfront payment, and (b) the remaining $10 million of the   upfront payment was paid to, and all future net cash proceeds under the   license agreement would be paid to, (i) Novelion to repay a portion of the   outstanding Novelion Intercompany Loan and (ii) the Bridge Lenders to repay a   portion of the outstanding Bridge Loan, on a 42% and 58% basis, respectively.   20 Prior to the Petition Date, beginning in July 2018, the Debtors’ advisors   initiated a competitive sales process to sell all or a portion of the   Debtors. See Declaration of Ashish Contractor in Support of Debtors’ Motion   for Order: (A) Approving and Authorizing Certain Plan Investor Protections;   and (B) Granting Related Relief, ¶¶ 10-11 [Docket No. 119, Ex. A]. During   that process, Moelis contacted more than fifty parties regarding their   potential interest in a transaction. Id. at ¶ 11. Twenty-five of these   parties expressed interest in the Debtors and their businesses and executed a   confidentiality agreement. Id. In connection with their marketing efforts,   Moelis created a data room with relevant documents and prepared a   comprehensive confidential presentation, which was distributed to twenty-four   potential transaction parties. Id. After twelve of the twenty-four parties   that received presentations elected to participate in, and participated in,   management presentations, six of these parties submitted final proposals to the   Debtors. Id. at ¶ 12. Four of these twelve parties submitted partial asset   proposals and chose not to advance in the process because of feedback they   received from the Debtors in response to these proposals. Id. at ¶ 13. After   receiving detailed presentations from the remaining two parties, the Debtors   ultimately chose to pursue the reverse merger with the Plan Investor as the   best approach available and entered into an exclusivity agreement with the   Plan Investor on April 11, 2019. Id. Ultimately, the Debtors determined that   the Plan Investor’s proposal represented the best proposal available at the   time. See Declaration of Barak Klein in Support of Debtors’ Motion for Order:   (A) Approving and Authorizing Certain Plan Investor Protections; and (B)   Granting Related Relief, ¶ 10 [Docket No. 119, Ex. B]. The related bid   protections for the Plan Investor were negotiated at arm’s length between the   Debtors and the Plan Investor. Id. at ¶¶ 10, 12. 31 

    

 

The Debtors   entered into the Plan Funding Agreement with the Plan Investor, which   contains a “Go-Shop Period” that enables the Debtors to solicit an   alternative transaction for fifty-five (55) days from the date the PFA Order   is entered. The Committee intends to be actively involved in the “Go-Shop   Period.” Under the PFA Order, the Committee was granted various consultation   and information rights, including, the Debtors’ obligation to provide the   Committee with: (i) access to all Company Alternative Proposals and related   developments; (ii) access to non-public information granted to all Persons   and Representatives in connection with Section 6.9 of the Plan Funding   Agreement; and (iii) participation rights in discussions with any party that   has made a proposal or been solicited. 4.2. The Proposed Restructuring   Transaction. To effectuate the Proposed Restructuring Transaction, the   Debtors entered into the RSA with the Plan Investor, Novelion, and certain   prepetition lenders representing (i) 100% in principal amount and number of   holders under the Bridge Loan, and (ii) in excess of 67% in principal amount   of the Convertible Notes. The RSA, which serves as the roadmap for the   Debtors’ successful reorganization, provides that the RSA parties will   support, and vote in favor of, a chapter 11 plan proposed by the Debtors   (subject to certain terms and conditions set forth therein). Among other   documents, the RSA parties also heavily negotiated the terms of the Plan,   this Disclosure Statement, and the Plan Funding Agreement — all of which were   filed with the Bankruptcy Court on the Petition Date. The benefits of the   Proposed Restructuring Transaction are significant: After giving effect to   the transaction, the Debtors will reduce their debt balance from   approximately $450 million to approximately $225 million and the maturity   dates under their continuing debt facilities will be extended by at least   five years. The Debtors pre-transaction and expected post-transaction capital   structure is illustrated below: • 32 

    

 

• This balance   sheet restructuring will include holders of Novelion Intercompany Loan Claims   and Other General Unsecured Claims (which include, among other things, the   Convertible Notes Claims, Claims held by former officers, directors, or   employees of the Debtors for indemnification, contribution or advancement   expenses, and contract rejection damages Claims) converting their Claims into   New Common Stock of the Plan Investor as well as (in the case of holders of   Other General Unsecured Claims) New Convertible Notes. In addition, the   outstanding amount due under the Bridge Loan will be refinanced into a new   secured term loan facility. • Payment in full in Cash to the Debtors’ trade   creditors that will continue to provide goods and services to the Debtors after   their emergence from these chapter 11 cases. The Debtors’ obligations under   the Government Settlement Agreements will not be impacted or altered in any   way by the Proposed Restructuring Transaction. To that end, the Debtors filed   a motion on the Petition Date seeking Bankruptcy Court relief to allow them   to continue making all ongoing payments under the Government Settlement   Agreements that arise in the ordinary course of business during these chapter   11 cases. In addition, upon the Debtors’ emergence from chapter 11, all   Government • 21 This pro forma amount will reflect the payments paid in the   ordinary course of business throughout these Chapter 11 Cases pursuant to the   Debtors’ Motion for Order (A) Authorizing Continued Payment of Government   Settlement Claims in the Ordinary Course of Business, and (B) Granting   Related Relief [Docket No. 15]. 22 The reorganized Debtors’ pro forma secured   debt will consist solely of the New Term Loan Facility, which shall be in the   original principal amount equal to (a) the New Money Bridge Loan Claim plus   (b) the Existing Plan Investor Debt. 33 Debt Instrument Current Pro Forma Pro   Forma Maturity Government $26.5 $22.721 2020-2021 Secured Debt Facility $73.8   $81.922 2024 Convertible Notes $304.1 $124.7 2024 Intercompany Loan $36.3 N/A   N/A Total $440.7 $229.3 

    

 

Settlement   Agreements will be assumed by the Debtors (and become obligations of the   Reorganized Debtors) and any unpaid amounts that are due and owing will be   cured. Both the Reorganized Debtors and the Plan Investor are equally   committed to the non-monetary aspects of the Government Settlement   Agreements, including the Debtors’ compliance and cooperation obligations.   Moreover, the Plan Investor has a strong culture of compliance, will maintain   all necessary protocols to ensure ongoing compliance, and will retain the   Debtors’ compliance infrastructure. The Proposed Restructuring Transaction   paves the way for a consensual chapter 11 proceeding and ensures the Debtors   emerge from bankruptcy as expeditiously as possible. The parties to the RSA   account for in excess of 67% of the Debtors’ funded indebtedness. In   addition, the RSA, which serves as the roadmap for the Debtors’ successful   reorganization, provides that the Plan Support Parties will support, and vote   in favor of, a chapter 11 plan proposed by the Debtors (subject to certain   terms and conditions set forth therein). • • The Debtors and the Plan   Investor will raise $60 million in cash through the Plan Investor’s issuance   of New Common Stock — all of which will be backstopped by the backstop   parties. Specifically, the Plan Investor will conduct a $42 million Rights   Offering as part of these chapter 11 cases and issue New Common Stock in the   Plan Investor to holders of Claims in Class 4 and Class 6B. In addition, the   Plan Investor will conduct a separate $18 million equity raise for New Common   Stock issued to existing shareholders of the Plan Investor. In connection   with executing the RSA, the Debtors also entered into the Plan Funding   Agreement23 with the Plan Investor, which, subject to certain terms and   conditions, provides that the Plan Investor will acquire 100% of the equity   interests of reorganized Aegerion in exchange for New Common Stock of the   Plan Investor. A copy of the Plan Funding Agreement is attached hereto as   Exhibit 6. Reorganized Aegerion will then distribute such equity to holders   of Class 4 and Class 6B Claims. Among other things, the Plan Funding   Agreement requires approval of the Proposed Restructuring Transaction by the   stockholders of the Plan Investor, certain regulatory approvals, and   confirmation of the Plan. Following the transaction, the Plan Investor will   continue as a public company, with reorganized Aegerion as its wholly-owned   subsidiary. Although the Plan Investor will acquire Aegerion, the Debtors’   creditors (including Novelion) will own 61.4% of the Plan Investor, with the   Plan Investor’s existing shareholders owning the remaining 38.6% (prior to 23   Upon the Debtors’ termination of the Plan Funding Agreement to pursue an   alternative transaction, the Plan Investor would receive a termination fee of   $7,300,000, equal to 1.85% of the enterprise value of the Debtors, and   reimbursement of any reasonable and documented fees and expenses of the Plan   Investor in connection with the negotiation, preparation and implementation   of the Transaction Documents (as defined in the Plan Funding Agreement) in an   amount not to exceed $5,500,000. 34 

    

 

completion of   the $42 million Rights Offering and $18 million Plan Investor Equity Raise).   Following the transaction, the pro forma ownership of reorganized Aegerion,   after giving effect to the new money equity raises but prior to giving effect   to the conversion of the New Convertible Notes, will be: (a) 49.4% creditors of   the Debtors (including Novelion), (b) 31.1% former Plan Investor   shareholders, and (c) 19.4% investors who participate in the Rights Offering.   All stakeholders are expected to benefit from the proposed transaction: • The   Plan Investor is a revenue generating pharmaceutical company focused on   acquiring, developing and commercializing innovative new treatments for   patients affected by rare or orphan diseases where there is a high unmet   medical need. Founded in 2015, Amryt has built a portfolio of assets to treat   its target patients through the acquisition of numerous drug products and   expansion via in-licensing agreements. Following the completion of Amryt’s   Lojuxta (lomitapide) in-licensing deal with Aegerion in December 2016, Amryt   became a commercial pharmaceutical company, generating sales across Europe,   the Middle East and other licensed territories. Amryt’s primary revenue   generator is the sale of Lojuxta and certain dermo-cosmetic products, which   are sold under the Imlan brand. The Plan Investor has extensive familiarity   with the Debtors and their products given the companies’ pre-existing   partnership and the fact that several former Aegerion officers are currently   employed by the Plan Investor. • This combination provides an opportunity for   synergies and cost savings. In addition to continuing operations with regard   to lomitapide and metreleptin (which will continue to be operated through   Aegerion post-closing), the Plan Investor also maintains a pipeline of rare   disease clinical programs and has devoted significant capital to expanding   its research and development capabilities in the last two years. The Proposed   Restructuring Transaction aligns with Amryt’s efforts to diversify and   expand, and presents a mutually beneficial path forward for both the Plan   Investor and the Debtors. • The Debtors’ decision to file these cases was   informed by several months of deliberations and negotiations with the   Debtors’ lenders, Novelion, the Plan Investor, and other key stakeholders.   The Debtors’ successful negotiations prior to the Petition Date provide a   clear path to a value maximizing transaction and confirmable plan for the   benefit of all of the Debtors’ stakeholders. 35 

    

 

ARTICLE V.   REASONS FOR THE SOLICITATION; RECOMMENDATION Chapter 11 of the Bankruptcy   Code provides that unless the terms of section 1129(b) of the Bankruptcy Code   are satisfied, for the Bankruptcy Court to confirm the Plan, the holders of   Claims in each Class of impaired Claims and Interests must accept the Plan by   the requisite majorities set forth in the Bankruptcy Code. Impaired Classes   of Claims shall have accepted the Plan if (a) the holders of at least   two-thirds (2/3) in amount of the Claims in such Class actually voting on the   Plan have voted to accept it, and (b) more than one-half (1/2) in number of   the holders of Claims in such Class actually voting on the Plan have voted to   accept it, and impaired Classes of Interests shall have accepted the Plan if   holders of at least two-thirds (2/3) in amount of the Allowed Interests of   such Class vote to accept it (such votes, the “Requisite Acceptances”). In   light of the significant benefits to be attained by the Debtors and their   creditors if the transactions contemplated by the Plan are consummated, the   Debtors recommend that all holders of Claims entitled to vote to accept the   Plan do so. The Debtors reached this decision after considering available   alternatives to the Plan and their likely effect on the Debtors’ business   operations, creditors, and shareholders. These alternatives included   alternative restructuring options under chapter 11 of the Bankruptcy Code,   and liquidation of the Debtors under chapter 7 of the Bankruptcy Code. The   Debtors determined, after consulting with their legal and financial advisors,   that the Plan, if consummated, will maximize the value of their estates for   all stakeholders, as compared to any other chapter 11 reorganization strategy   or a liquidation under chapter 7. For all of these reasons, the Debtors and   the Plan Support Parties support confirmation of the Plan and urge the   holders of Claims entitled to vote on the Plan to accept and support it. The   Committee has not made a determination at this time as to whether it does or   does not support the Plan.24 ARTICLE VI. THE PLAN 6.1.Overview of Chapter 11.   Chapter 11 is the principal business reorganization chapter of the Bankruptcy   Code. Under chapter 11, a debtor is authorized to restructure its business   for the benefit of itself, its creditors and its equity interest holders. In   addition to permitting the rehabilitation of a debtor, another goal of   chapter 11 is to promote equality of treatment for similarly situated   creditors and similarly situated equity interest holders with respect to the   distribution of a debtor’s assets. The commencement of a chapter 11 case   creates an estate that comprises of all of the legal and equitable interests   of the debtor as of the bankruptcy filing date. The Bankruptcy 24 The   Committee is continuing to review the terms of the Plan and reserves all   rights with respect to the terms thereof. 36 

    

 

Code provides   that the debtor may continue to operate its business and remain in possession   of its property as a “debtor in possession.” The consummation of a chapter 11   plan is the principal objective of a chapter 11 reorganization case. A   chapter 11 plan sets forth the means for satisfying claims against and   interests in a debtor. Confirmation of a chapter 11 plan by the bankruptcy   court makes that plan binding upon the debtor, any issuer of securities under   the plan, any person acquiring property under the plan and any creditor or   equity interest holder of the debtor. Subject to certain limited exceptions,   the order approving confirmation of a plan discharges a debtor from any debt   that arose prior to the date of confirmation of the plan and substitutes them   for the obligations specified under the confirmed plan. In general, a chapter   11 plan of reorganization: (a) divides claims and equity interests into   separate classes, (b) specifies the property, if any, that each class is to   receive under the plan, and (c) contains other provisions necessary to the   restructuring of the debtor that are required or permitted by the Bankruptcy   Code. Pursuant to section 1125 of the Bankruptcy Code, acceptance or   rejection of a chapter 11 plan may not be solicited after the commencement of   a chapter 11 case until such time as the court has approved the disclosure   statement as containing “adequate information.” Pursuant to section 1125(a)   of the Bankruptcy Code, “adequate information” is information of a kind, and   in sufficient detail, to enable a hypothetical reasonable investor to make an   informed judgment regarding the chapter 11 plan. To satisfy the applicable   disclosure requirements, the Debtors submit this Disclosure Statement to   holders of Claims that are impaired and not deemed to have rejected the Plan.   6.2. Resolution of Certain Inter-Creditor and Inter-Debtor Issues. (a)   Settlement of Certain Inter-Creditor Issues. The treatment of Claims and   Interests under the Plan represents, among other things, the settlement and   compromise of certain potential inter-creditor disputes. (b) Formation of   Debtor Group for Convenience Purposes. The Plan groups the Debtors together   solely for purposes of describing treatment under the Plan, confirmation of   the Plan and making Plan Distributions in respect of Claims against and   Interests in the Debtors under the Plan. Such grouping shall not affect any   Debtor’s status as a separate legal entity, change the organizational   structure of the Debtors’ business enterprise, constitute a change of control   of any Debtor for any purpose, cause a merger or consolidation of any legal   entities, nor cause the transfer of any assets or the assumption of any   liabilities; and, except as otherwise provided by or permitted in the Plan,   all Debtors shall continue to exist as separate legal entities. 37 

    

 

(c)Intercompany   Claims and Intercompany Interests. i. Intercompany Claims. Notwithstanding   anything to the contrary in the Plan, on or after the Effective Date, any and   all Intercompany Claims shall, at the option of the Debtors or the   Reorganized Debtors, as applicable, and as Acceptable to the Required   Parties, either be (i) extinguished, canceled and/or discharged on the   Effective Date, or (ii) reinstated and otherwise survive the Debtors’   restructuring by virtue of such Intercompany Claims being left unimpaired. To   the extent any such Intercompany Claim is reinstated, or otherwise adjusted   (including by contribution, distribution in exchange for new debt or equity,   or otherwise), paid or continued as of the Effective Date, any such   transaction may be effected on or after the Effective Date without any   further action by the Bankruptcy Court, act or action under applicable law,   regulation, order or rule or the vote, consent, authorization or approval of   any Person. ii. Intercompany Interests. No Intercompany Interests shall be   cancelled pursuant to the Plan, and all Intercompany Interests shall be   unaffected by the Plan and continue in place following the Effective Date,   solely for the administrative convenience of maintaining the existing   corporate structure of the Debtors and the Reorganized Debtors. 6.3. Overview   of the Plan. THE FOLLOWING IS A SUMMARY OF SOME OF THE SIGNIFICANT ELEMENTS   OF THE PLAN. THIS DISCLOSURE STATEMENT IS QUALIFIED IN ITS ENTIRETY BY   REFERENCE TO THE MORE DETAILED INFORMATION SET FORTH IN THE PLAN AND THE   EXHIBITS AND SCHEDULES THERETO. The Plan classifies Claims and Interests   separately in accordance with the Bankruptcy Code and provides different   treatment for different Classes of Claims and Interests. Claims and Interests   shall be included in a particular Class only to the extent such Claims or   Interests qualify for inclusion within such Class. The Plan separates the   various Claims and Interests (other than those that do not need to be   classified) into nine (9) separate Classes. These Classes take into account   the differing nature and priority of Claims against, and Interests in, the   Debtors. Unless otherwise indicated, the characteristics and amounts of the   Claims or Interests in the following Classes are based on the books and   records of the Debtors. This section summarizes the treatment of each of the   Classes of Claims and Interests under the Plan and describes other provisions   of the Plan. Only holders of Allowed Claims — Claims that are not in dispute,   contingent, or unliquidated in amount and are not subject to an objection or   an estimation request — are entitled to receive distributions under the Plan.   For a more detailed description of the definition of “Allowed,” see Article I   of the Plan. Until a Disputed Claim becomes Allowed, no distributions of New   Common Stock, Cash or otherwise will be made on account of such Claim. The   Plan is intended to enable the Debtors to continue present operations without   the likelihood of a subsequent liquidation or the need for further financial   reorganization. The 38 

    

 

Debtors believe   that they will be able to perform their obligations under the Plan. The   Debtors also believe that the Plan permits fair and equitable recoveries. The   Confirmation Date will be the date that the Confirmation Order is entered by   the Clerk of the Bankruptcy Court. The Effective Date will be the first   Business Day on or after the Confirmation Date on which all of the conditions   to the Effective Date specified in Section 11.1 of the Plan have been   satisfied or waived, including the consummation of the transactions   contemplated by the Plan. Resolution of any challenges to the Plan may take   time and, therefore, the actual Effective Date cannot be predicted with   certainty. Other than as specifically provided in the Plan, the treatment   under the Plan of each Claim and Interest will be in full satisfaction,   settlement, release and discharge of all Claims or Interests. The Debtors   will make all payments and other distributions to be made under the Plan   unless otherwise specified. The Plan constitutes a joint plan of   reorganization for all of the Debtors. All Claims and Interests, except DIP   Claims, Administrative Expense Claims, Fee Claims, Ad Hoc Group Fee Claim,   U.S. Trustee Fees and Priority Tax Claims, are placed in the Classes set   forth in Article IV below. In accordance with section 1123(a)(1) of the   Bankruptcy Code, DIP Claims, Administrative Expense Claims, Fee Claims, U.S.   Trustee Fees and Priority Tax Claims have not been classified, and the   holders thereof are not entitled to vote on the Plan. A Claim or Interest is   placed in a particular Class only to the extent that such Claim or Interest   falls within the description of that Class and is classified in other Classes   to the extent that any portion of the Claim or Interest falls within the   description of such other Classes. A Claim or Interest is placed in a   particular Class for all purposes, including voting, confirmation and distribution   under the Plan and under sections 1122 and 1123(a)(1) of the Bankruptcy Code.   However, a Claim or Interest is placed in a particular Class for the purpose   of receiving Plan Distributions only to the extent that such Claim or   Interest is an Allowed Claim or Allowed Interest and has not been paid,   released or otherwise settled prior to the Effective Date. (a) Unclassified   Claims. (i) DIP Claims. On the Effective Date, the DIP Claims shall be   Allowed and shall not be subject to any avoidance, reductions, setoff,   offset, recoupment, recharacterization, subordination (whether equitable,   contractual, or otherwise), counterclaims, cross-claims, defenses,   disallowance, impairment, objection, or any other challenges under any   applicable law or regulation by any Person. In full satisfaction, settlement,   release and discharge of the Allowed DIP Claims, on the Effective Date,   Allowed DIP Claims shall (a) be paid in Cash to the greatest extent possible   from available Cash of the Debtors (as reasonably agreed by the Debtors and   the DIP Lenders), and (b) to the extent the Allowed DIP Claims are not paid   in full in Cash on the Effective Date, receive New Convertible Notes in an   amount equal to the amount of the Allowed DIP Claims not receiving Cash   pursuant to the foregoing clause (a). Payment of any unpaid fees and expenses   of the DIP Administrative Agent shall be paid to the DIP Administrative Agent   in 39 

    

 

cash on the   Effective Date. Distributions on account of Allowed DIP Claims other than   Cash will not be distributed to the DIP Administrative Agent but instead   shall be distributed directly to the DIP Lenders as reflected on the registry   maintained by the DIP Administrative Agent as of the Confirmation Date. The   Debtors will request such registry from the DIP Administrative Agent. Upon   satisfaction of the Allowed DIP Lender Claims as set forth in this Section   3.1 of the Plan, all Liens and security interests granted to secure such   obligations, whether in the Chapter 11 Cases or otherwise, shall be   terminated and of no further force or effect. (ii) Administrative Expense   Claims. (1) Time for Filing Administrative Expense Claims. The holder of an   Administrative Expense Claim, other than the holder of: (a) a Fee Claim; (b)   a DIP Claim; (c) a 503(b)(9) Claim; (d) an Ad Hoc Group Fee Claim; (e)   Effective Date; an Administrative Expense Claim that has been Allowed on or   before the (f) an Administrative Expense Claim for an expense or liability   incurred and payable in the ordinary course of business by a Debtor; (g) an   Administrative Expense Claim on account of fees and expenses incurred on or   after the Petition Date by ordinary course professionals retained by the   Debtors pursuant to an order of the Bankruptcy Court; (h) an Administrative   Expense Claim held by an officer, director or employee of the Debtors serving   in such capacity immediately prior to the occurrence of the Effective Date   solely in their capacity as such (whether or not also an officer, director or   employee of Novelion) for indemnification, contribution, or advancement of   expenses pursuant to (A) any Debtor’s certificate of incorporation, by-laws,   operating agreement, or similar organizational document, (B) any employment,   director or similar agreement, or (C) any indemnification or contribution   agreement approved by the Bankruptcy Court; (i) an Administrative Expense   Claim arising, in the ordinary course of business, out of the employment by   one or more Debtors of an individual from and after the Petition Date, but   only to the extent that such Administrative Expense Claim is solely for   outstanding wages, commissions, accrued benefits, or reimbursement of   business expenses; (j) a Claim for adequate protection arising under the DIP   Order; (k) an Administrative Expense Claim of Novelion or Novelion Services   USA, 40 

    

 

Inc. arising   out of or related to the Shared Services Agreements; (l) an Intercompany   Claim; (m) an Administrative Expense Claim described in 11 U.S.C. §   503(b)(1)(B)-(C), if the holder is a Governmental Unit; or (n) U.S. Trustee   Fees, must file with the Bankruptcy Court and serve on the Reorganized   Debtors, the Claims Agent, and the U.S. Trustee, proof of such Administrative   Expense Claim within thirty (30) days after the Effective Date (the   “Administrative Bar Date”). Such proof of Administrative Expense Claim must   include at a minimum: (1) the name of the applicable Debtor that is purported   to be liable for the Administrative Expense Claim and if the Administrative   Expense Claim is asserted against more than one Debtor, the exact amount   asserted to be owed by each such Debtor; (2) the name of the holder of the   Administrative Expense Claim; (3) the asserted amount of the Administrative   Expense Claim; (4) the basis of the Administrative Expense Claim; and (5)   supporting documentation for the Administrative Expense Claim. FAILURE TO   FILE AND SERVE SUCH PROOF OF ADMINISTRATIVE EXPENSE CLAIM TIMELY AND PROPERLY   SHALL RESULT IN SUCH CLAIM BEING FOREVER BARRED AND DISCHARGED. (2) Treatment   of Administrative Expense Claims. Except to the extent that a holder of an Allowed   Administrative Expense Claim agrees to a different treatment, on, or as soon   thereafter as is reasonably practicable, the later of the Effective Date and   the first Business Day after the date that is thirty (30) calendar days after   the date an Administrative Expense Claim becomes an Allowed Claim, the holder   of such Allowed Administrative Expense Claim shall receive from the   applicable Reorganized Debtor Cash in an amount equal to such Allowed Claim;   provided, however, that Allowed Administrative Expense Claims representing   liabilities incurred in the ordinary course of business by any of the   Debtors, as debtors in possession, shall be paid by the applicable   Reorganized Debtor in the ordinary course of business, consistent with past   practice and in accordance with the terms and subject to the conditions of   any orders or agreements governing, instruments evidencing, or other   documents relating to, such liabilities. Any Claim related to fees and   expenses, contribution or indemnification obligations, payable or owing by   the Debtors to the Ad Hoc Group, the Plan Investor, or the Backstop Parties   under the RSA, the Backstop Commitment Agreement, the Plan Funding Agreement,   or the PFA Order shall constitute an Allowed Administrative Expense Claim and   shall be paid in Cash on the Effective Date or as soon thereafter as is   reasonably practicable without the need to file a proof of such Claim with   the Bankruptcy Court in accordance with Section 3.2(a) of the Plan and   without further order of the Bankruptcy Court. Any Claim then payable or   owing by the Debtors to Novelion or Novelion Services, USA, Inc. arising out   of or related to the Shared Services Agreements shall be paid in Cash on the   Effective Date from Plan Cash, without the need to file a proof of such Claim   with 41 

    

 

the Bankruptcy   Court in accordance with Section 3.2(a) of the Plan and without further order   of the Bankruptcy Court. (iii) Fee Claims. (1) Time for Filing Fee Claims.   Any Professional Person seeking allowance of a Fee Claim shall file with the   Bankruptcy Court its final application for allowance of compensation for   services rendered and reimbursement of expenses incurred prior to the   Effective Date and in connection with the preparation and prosecution of such   final application no later than forty-five (45) calendar days after the   Effective Date or such other date as established by the Bankruptcy Court.   Objections to such Fee Claims, if any, must be filed and served no later than   sixty-five (65) calendar days after the Effective Date or such other date as   established by the Bankruptcy Court. (2) Treatment of Fee Claims. All   Professional Persons seeking allowance by the Bankruptcy Court of a Fee Claim   shall be paid in full in Cash in such amounts as are approved by the Bankruptcy   Court: (i) upon the later of (x) the Effective Date, and (y) three (3)   calendar days after the date upon which the order relating to the allowance   of any such Fee Claim is entered, or (ii) upon such other terms as may be   mutually agreed upon between the holder of such Fee Claim and the Reorganized   Debtors. On the Effective Date, the Reorganized Debtors shall reserve and   hold in a segregated account Cash in an amount equal to all accrued but   unpaid Fee Claims as of the Effective Date, which Cash shall be disbursed   solely to the holders of Allowed Fee Claims with the remainder to be reserved   until all Fee Claims have been either Allowed and paid in full or Disallowed   by Final Order, at which time any remaining Cash in the segregated account   shall become the sole and exclusive property of the Reorganized Debtors;   provided that the Debtors’ and the Reorganized Debtors’ obligations to pay   Allowed Fee Claims shall not be limited or deemed limited to funds held in   any escrow account. To the extent that funds held in any escrow account for   Allowed Fee Claims are insufficient to satisfy the Allowed amount of Fee   Claims owing to the Professional Person, the Reorganized Debtors shall pay   such amounts within ten (10) Business Days of entry of the order approving such   Fee Claims. (iv) U.S. Trustee Fees. The Debtors or Reorganized Debtors, as   applicable, shall pay all outstanding U.S. Trustee Fees of a Debtor on an   ongoing basis on the date such U.S. Trustee Fees become due, until such time   as a final decree is entered closing the applicable Chapter 11 Case, the   applicable Chapter 11 Case is converted or dismissed, or the Bankruptcy Court   orders otherwise. (v) Priority Tax Claims. Except to the extent that a holder   of an Allowed Priority Tax Claim agrees to different treatment, each holder   of an Allowed Priority Tax Claim shall receive, in the Debtors’ or   Reorganized Debtors’ discretion, either: (a) on, or as soon thereafter as is   reasonably practicable, the later of the Effective Date and the first   Business Day after the date that is thirty (30) calendar days after the date   a Priority Tax Claim becomes an Allowed Claim, Cash in an 42 

    

 

amount equal to   such Claim; or (b) deferred Cash payments following the Effective Date, over   a period ending not later than five (5) years after the Petition Date, in an   aggregate amount equal to the Allowed amount of such Priority Tax Claim (with   any interest to which the holder of such Priority Tax Claim may be entitled   calculated in accordance with section 511 of the Bankruptcy Code); provided,   however, that all Allowed Priority Tax Claims that are not due and payable on   or before the Effective Date shall be paid in the ordinary course of business   as they become due. 6.4. Classification of Claims and Interests. (a) Classification   of Claims and Interests. The following table designates the Classes of Claims   against and Interests in the Debtors, and specifies which Classes are: (a)   impaired or unimpaired by the Plan; (b) entitled to vote to accept or reject   the Plan in accordance with section 1126 of the Bankruptcy Code; or (c)   deemed to accept or reject the Plan. If a controversy arises regarding   whether any Claim or Interest is properly classified under the Plan, the   Bankruptcy Court shall, upon proper motion and notice, determine such   controversy at the Confirmation Hearing. If the Bankruptcy Court finds that   the classification of any Claim or Interest is improper, then such Claim or   Interest shall be reclassified and any Ballot previously cast by the holder   of such Claim or Interest shall be counted in, and the Claim or Interest   shall receive the treatment prescribed in, the Class in which the Bankruptcy   Court determines such Claim or Interest should have been classified, without   the necessity of resoliciting any votes on the Plan. (b) Unimpaired Classes   of Claims. 43 Class Designation Impairment Entitled to Vote Class 1 Priority   Non-Tax Claims No No (Presumed to accept) Class 2 Other Secured Claims No No   (Presumed to accept) Class 3 Bridge Loan Claims Yes Yes Class 4 Novelion   Intercompany Loan Claims Yes Yes Class 5 Government Settlement Claims No No   (Presumed to accept) Class 6A Ongoing Trade Claims No No (Presumed to accept)   Class 6B Other General Unsecured Claims Yes Yes Class 7 Existing Securities   Law Claims Yes No (Deemed to reject) Class 8 Existing Interests Yes No   (Deemed to reject) 

    

 

The following   Classes of Claims are unimpaired and, therefore, presumed to have accepted   the Plan and are not entitled to vote on the Plan under section 1126(f) of   the Bankruptcy Code: (i) Class 1: Class 1 consists of all Priority Non-Tax   Claims. (ii) Class 2: Class 2 consists of all Other Secured Claims. (iii)   Class 5: Class 5 consists of all Government Settlement Claims. (iv) Class 6A:   Class 6A consists of all Ongoing Trade Claims. (c) Impaired Classes of   Claims. The following Classes of Claims are impaired and entitled to vote on   the Plan: (i) Class 3: Class 3 consists of all Bridge Loan Claims. (ii) Class   4: Class 4 consists of all Novelion Intercompany Loan Claims. (iii) Class 6B:   Class 6B consists of all Other General Unsecured Claims. The following   Classes of Claims and Interests are impaired and deemed to have rejected the   Plan and, therefore, are not entitled to vote on the Plan under section   1126(g) of the Bankruptcy Code: (i) Class 7: Class 7 consists of all Existing   Securities Law Claims. (ii) Class 8: Class 8 consists of all Existing   Interests. (d) Separate Classification of Other Secured Claims. Although all   Other Secured Claims have been placed in one Class for purposes of   nomenclature, each Other Secured Claim, to the extent secured by a Lien on   Collateral different than that securing any additional Other Secured Claims,   shall be treated as being in a separate sub-Class for the purpose of   receiving Plan Distributions. 6.5. Treatment of Claims and Interests. (a)   Priority Non-Tax Claims (Class 1). Treatment: The legal, equitable and   contractual rights of the holders of Priority Non-Tax Claims are unaltered by   the Plan. Except to the extent that a holder of an Allowed Priority Non-Tax   Claim agrees to a different treatment, on the applicable Distribution Date,   each holder of an Allowed Priority Non-Tax Claim shall receive Cash from the   applicable Reorganized Debtor in an amount equal to such Allowed Claim. 44 

    

 

Voting: The   Priority Non-Tax Claims are Unimpaired Claims. In accordance with section   1126(f) of the Bankruptcy Code, the holders of Priority Non-Tax Claims are   conclusively presumed to accept the Plan and are not entitled to vote to   accept or reject the Plan, and the votes of such holders will not be   solicited with respect to such Allowed Priority Non-Tax Claims. (b) Other   Secured Claims (Class 2). Treatment: The legal, equitable and contractual   rights of the holders of Other Secured Claims are unaltered by the Plan.   Except to the extent that a holder of an Allowed Other Secured Claim agrees   to a different treatment, on the applicable Distribution Date each holder of   an Allowed Other Secured Claim shall receive, at the election of the   Reorganized Debtors: (i) Cash in an amount equal to such Allowed Claim; or   (ii) such other treatment that will render such Other Secured Claim   unimpaired pursuant to section 1124 of the Bankruptcy Code; provided,   however, that Other Secured Claims incurred by a Debtor in the ordinary   course of business may be paid in the ordinary course of business in   accordance with the terms and conditions of any agreements relating thereto,   in the discretion of the applicable Debtor or Reorganized Debtor without   further notice to or order of the Bankruptcy Court. Each holder of an Allowed   Other Secured Claim shall retain the Liens securing its Allowed Other Secured   Claim as of the Effective Date until full and final satisfaction of such   Allowed Other Secured Claim is made as provided in the Plan. On the full   payment or other satisfaction of each Allowed Other Secured Claim in   accordance with the Plan, the Liens securing such Allowed Other Secured Claim   shall be deemed released, terminated and extinguished, in each case without   further notice to or order of the Bankruptcy Court, act or action under   applicable law, regulation, order or rule or the vote, consent, authorization   or approval of any Person. Deficiency Claims: To the extent that the value of   the Collateral securing any Other Secured Claim is less than the Allowed   amount of such Other Secured Claim, the undersecured portion of such Allowed   Claim shall be treated for all purposes under the Plan as an Other General   Unsecured Claim and shall be classified as a Class 6B Other General Unsecured   Claim. Voting: The Allowed Other Secured Claims are Unimpaired Claims. In   accordance with section 1126(f) of the Bankruptcy Code, the holders of   Allowed Other Secured Claims are conclusively presumed to accept the Plan and   are not entitled to vote to accept or reject the Plan, and the votes of such   holders will not be solicited with respect to such Allowed Other Secured   Claims. (c) Bridge Loan Claims (Class 3). Treatment: The Bridge Loan Claims   shall be Allowed under the Plan, and shall not be subject to any avoidance,   reductions, setoff, offset, recoupment, recharacterization, subordination   (whether equitable, contractual, or otherwise), counterclaims, cross-claims,   defenses, disallowance, impairment, objection, or any other challenges under   any applicable law or regulation by any Person. Except to the extent that a   holder of a Bridge Loan Claim agrees to different treatment with respect to   such holder’s Claim, on the applicable Distribution Date, or as soon as   practicable thereafter, each holder of a Bridge Loan Claim shall receive,   subject to the 45 

    

 

terms of the   Plan, in full and final satisfaction, settlement, release and discharge of   its Bridge Loan Claim: (i) New Money Bridge Loan Claim: receipt of New Term   Loan Facility Obligations on a dollar for dollar basis on account of its New   Money Bridge Loan Claim. (ii) Roll Up Loan Claim: receipt of New Convertible   Notes on a dollar for dollar basis on account of its Roll Up Loan Claim.   Voting: The Bridge Loan Claims are impaired Claims. Holders of such Claims   are entitled to vote to accept or reject the Plan. The Bridge Loan Lenders,   as reflected on the registry maintained by the Bridge Loan Administrative   Agent on the date the Disclosure Statement Order is entered on the Bankruptcy   Court’s docket, rather than the Bridge Loan Administrative Agent, will vote   on the Plan. The Debtors will request such registry from the Bridge Loan   Administrative Agent and votes will be solicited directly by the Debtors with   respect to such Bridge Loan Claims. (d) Novelion Intercompany Loan Claims   (Class 4). Treatment: The Novelion Intercompany Loan Claim shall be Allowed   under the Plan, and shall not be subject to any avoidance, reductions,   setoff, offset, recoupment, recharacterization, subordination (whether   equitable, contractual, or otherwise), counterclaims, cross-claims, defenses,   disallowance, impairment, objection, or any other challenges under any   applicable law or regulation by any Person. Except to the extent that the   holder of the Novelion Intercompany Loan Claim agrees to different treatment,   on the applicable Distribution Date, or as soon as practicable thereafter,   the holder of the Novelion Intercompany Loan Claim shall receive, in full and   final satisfaction, release and discharge of the Novelion Intercompany Loan   Claim, the Class 4 New Common Stock Distribution. For the avoidance of doubt,   in satisfaction of the Novelion Intercompany Loan Claim in accordance with   this Section 5.4, Novelion shall waive and release any and all Other Novelion   Claims, and Novelion shall not be entitled to any distribution or   consideration on account thereof, except as provided in the Shared Services   Agreements pursuant to Section 7.16 of the Plan. Voting: The Novelion   Intercompany Loan Claim is an impaired Claim. The holder of such Claim is   entitled to vote to accept or reject the Plan, and the vote of such holder   will be solicited with respect to such Novelion Intercompany Loan Claim. (e)   Government Settlement Claims (Class 5). Treatment: Except to the extent that   a holder of a Government Settlement Claim agrees to a different treatment,   Government Settlement Claims shall be unimpaired by the Plan and shall remain   obligations of the Reorganized Debtors to the extent not satisfied and/or   paid on or before the Effective Date. The Government Settlement Agreements   shall be deemed assumed by the Debtors, and binding upon the Reorganized   Debtors and the applicable parties thereto as of and following the Effective   Date (provided that the foregoing shall not constitute a determination   whether such agreements are executory contracts subject to section 365 of the   Bankruptcy Code). Notwithstanding the foregoing, and unless the applicable   parties to the 46 

    

 

Government   Settlement Agreements object in writing to such treatment prior to the   deadline established by the Bankruptcy Court to object to confirmation of the   Plan, the monetary obligations under the Government Settlement Agreements   shall not be accelerated or increased as a result of the commencement of the   Chapter 11 Cases or the consummation of the transactions contemplated by the   Plan, the Plan Funding Agreement and/or the other Transaction Documents,   including the occurrence of any Fundamental Transaction (as defined in the   Government Settlement Agreements), by virtue of the consummation of any such   transactions or the failure of the New Common Stock of the Plan Investor to   be listed on the NASDAQ or other US stock exchange. Nothing in the foregoing   paragraph affects or limits the provisions of Section 12.6(d)-(e) of the   Plan. Voting: The Government Settlement Claims are Unimpaired Claims. In   accordance with section 1126(f) of the Bankruptcy Code, the holders of the   Government Settlement Claims are conclusively presumed to accept the Plan and   are not entitled to vote to accept or reject the Plan, and the votes of such   holders will not be solicited with respect to the Government Settlement   Claims.25 (f) Ongoing Trade Claims (Class 6A). Treatment: Except to the   extent that a holder of an Allowed Ongoing Trade Claim agrees to a different   treatment, on the applicable Distribution Date each holder of an Allowed   Ongoing Trade Claim shall, at the election of the Reorganized Debtors, and to   the extent that such Allowed Ongoing Trade Claim was not previously paid pursuant   to an order of the Bankruptcy Court: (i) be paid in full in Cash on the   applicable Distribution Date, plus postpetition interest at the Applicable   Interest Rate, computed daily from the Petition Date through the Effective   Date, from Plan Cash, (ii) as to any Ongoing Trade Claim incurred in the   ordinary course of business and on normal credit terms where payment comes   due following the Effective Date, receive such treatment that leaves   unaltered the legal, equitable, or contractual rights to which the holder of   such Allowed Ongoing Trade Claim is entitled, or (iii) such other treatment   that would render such Ongoing Trade Claim Unimpaired. Voting: The Allowed   Ongoing Trade Claims are Unimpaired Claims. In accordance with section   1126(f) of the Bankruptcy Code, the holders of Allowed Ongoing Trade Claims   are conclusively presumed to accept the Plan and are not entitled to vote to   accept or reject the Plan, and the votes of such holders will not be   solicited with respect to such Allowed Ongoing Trade Claims. 25 It is the   Debtors’ position that the Government Settlement Claims are Unimpaired Claims   and that Class 5 is presumed to accept the Plan under section 1126(f) of the   Bankruptcy Code. However, the holders of Government Settlement Claims reserve   their rights to dispute the Debtors’ position and/or to object to the Plan by   the deadline established by the Bankruptcy Court. Further, even if the   holders of Government Settlement Claims are presumed to accept the Plan, that   presumption in no way affects or limits the provisions of Section 12.6(d)-(e)   of the Plan. 47 

    

 

(g) Other   General Unsecured Claims (Class 6B). Treatment: Except to the extent that a   holder of an Allowed Other General Unsecured Claim agrees to less favorable   treatment, each holder of an Allowed Other General Unsecured Claim shall   receive, on the applicable Distribution Date and in full and final   satisfaction, settlement and release of such Allowed Other General Unsecured   Claim, its Pro Rata Share of: (i) New Convertible Notes in the principal   amount of $125,000,000 less the portion of New Convertible Notes distributed   to (x) holders of DIP Claims (to the extent the DIP Claims are not repaid in   full in Cash and receive a distribution of New Convertible Notes pursuant to Section   3.1 of the Plan), and (y) the holders of Roll Up Loan Claims pursuant to   Section 5.3(a)(ii) of the Plan; and (ii) the Class 6B New Common Stock   Distribution (including any New Common Stock issuable upon exercise of the   New Warrants). Voting: The Other General Unsecured Claims are impaired   Claims. Holders of such Claims are entitled to vote to accept or reject the   Plan, and the votes of such holders will be solicited with respect to such   Other General Unsecured Claims. (h) Existing Securities Law Claims (Class 7).   Treatment: Holders of Existing Securities Law Claims shall not receive or   retain any distribution under the Plan on account of such Existing Securities   Law Claims. Voting: The Existing Securities Law Claims are impaired Claims.   In accordance with section 1126(g) of the Bankruptcy Code, the holders of   Existing Securities Law Claims are conclusively deemed to reject the Plan and   are not entitled to vote to accept or reject the Plan, and the votes of such   holders will not be solicited with respect to such Existing Securities Law   Claims. (i) Existing Interests (Class 8). Treatment: Existing Interests shall   be discharged, cancelled, released and extinguished, and holders thereof   shall not receive or retain any distribution under the Plan on account of   such Existing Interests. Voting: The Existing Interests are impaired   Interests. In accordance with section 1126(g) of the Bankruptcy Code, the   holders of Existing Interests are conclusively deemed to reject the Plan and   are not entitled to vote to accept or reject the Plan, and the votes of such   holders will not be solicited with respect to such Existing Interests 48 

    

 

6.6. Acceptance   or Rejection of the Plan; Effect of Rejection by One or More Classes of   Claims or Interests. (a) Class Acceptance Requirement. A Class of Claims   shall have accepted the Plan if it is accepted by at least two-thirds (2/3)   in dollar amount and more than one-half (1/2) in number of holders of the   Allowed Claims in such Class that have voted on the Plan calculated in   accordance with the Disclosure Statement Order. (b) Tabulation of Votes on a   Non-Consolidated Basis. All votes on the Plan shall be tabulated on a   non-consolidated basis by Class and by Debtor for the purpose of determining   whether the Plan satisfies sections 1129(a)(8) and/or (10) of the Bankruptcy   Code. (c) Confirmation Pursuant to Section 1129(b) of the Bankruptcy Code or   “Cramdown.” Because certain Classes are deemed to have rejected the Plan, the   Debtors will request confirmation of the Plan, as it may be modified and   amended from time to time, under section 1129(b) of the Bankruptcy Code with   respect to such Classes. Subject to Sections 14.5 and 14.6 of the Plan, the   Debtors reserve the right (subject to the parties’ rights under the RSA and the   Plan Funding Agreement) to alter, amend, modify, revoke or withdraw the Plan   or any Plan Document in order to satisfy the requirements of section 1129(b)   of the Bankruptcy Code, if necessary. Subject to Sections 14.5 and 14.6 of   the Plan, the Debtors also reserve the right to request confirmation of the   Plan, as it may be modified, supplemented or amended from time to time, with   respect to any Class that affirmatively votes to reject the Plan. (d)   Elimination of Vacant Classes. Any Class of Claims or Interests that does not   have a holder of an Allowed Claim or Allowed Interest or a Claim or Interest   temporarily Allowed as of the date of the Confirmation Hearing shall be   deemed eliminated from the Plan for purposes of voting to accept or reject   the Plan and for purposes of determining acceptance or rejection of the Plan   pursuant to section 1129(a)(8) of the Bankruptcy Code. (e) Voting Classes;   Deemed Acceptance by Non-Voting Classes. If a Class contains Claims or   Interests eligible to vote and no holders of Claims or Interests eligible to   vote in such Class vote to accept or reject the Plan, the Plan shall be   deemed accepted by such Class. (f) Confirmation of All Cases. Except as   otherwise specified therein, the Plan shall not be deemed to have been confirmed   unless and until the Plan has been confirmed as to each of the Debtors;   provided, 49 

    

 

however, that   the Debtors, subject to the parties’ rights under the RSA and the Plan   Funding Agreement, may at any time waive this Section 6.6. 6.7. Means for   Implementation. (a) Non-Substantive Consolidation. The Plan is a joint plan   that does not provide for substantive consolidation of the Debtors’ Estates,   and on the Effective Date, the Debtors’ Estates shall not be deemed to be   substantively consolidated for purposes hereof. Except as specifically set   forth in the Plan, nothing in the Plan shall constitute or be deemed to   constitute an admission that any one of the Debtors is subject to or liable   for any claim against any other Debtor. Additionally, claimants holding   Claims and Interests against multiple Debtors, to the extent Allowed in each   Debtor’s Chapter 11 Case, will be treated as holding a separate Claim or   separate Interest, as applicable, against each Debtor’s Estate, provided,   however, that no holder of an Allowed Claim shall be entitled to receive more   than payment in full of such Allowed Claim (plus postpetition interest, if   and to the extent provided in the Plan), and such Claims will be administered   and treated in the manner provided in the Plan. (b) Plan Funding Transaction.   On the Effective Date, subject to the terms and conditions set forth in the   Plan Funding Agreement and the Implementation Memorandum and in exchange for   New Common Stock in the Plan Investor or a newly formed holding company of   the Plan Investor (“New Amryt”) and the other obligations of the Plan   Investor and/or New Amryt under the Plan Funding Agreement and the Plan,   Aegerion shall sell to the Plan Investor or New Amryt one hundred percent   (100%) of the New Equity Interests in reorganized Aegerion. From and after   the Effective Date, the Plan Investor or New Amryt shall directly and   indirectly own the Reorganized Debtors. The existing shareholders of the Plan   Investor shall own 38.6% of New Common Stock and the holders of Class 4 and   Class 6B Claims shall collectively own 61.4% of the New Common Stock (prior   to completion of the $42 million Rights Offering and $18 million Plan   Investor Equity Raise). The transfer of the New Equity Interests of   reorganized Aegerion to the Plan Investor or New Amryt, and any and all   action to be taken in connection therewith, shall be authorized without the   need for any further board, corporate or shareholder action of the Debtors or   Novelion. The issuance of the New Common Stock requires the approval of the   U.K. Panel on Takeovers and Mergers. Further, the formation of New Amryt will   be effected pursuant to a scheme of arrangement that requires the approval of   both the (a) shareholders of the Plan Investor (with a voting threshold of   75% of those voting and a majority in number of those voting) and (b) courts   of England and Wales. The scheme of arrangement will be undertaken pursuant   to Part 26 of the Companies Act of 2006 and will involve an application by   the Plan Investor to the High Court of Justice in England and Wales to   sanction the scheme of arrangement to allow New Amryt to become the holding   company of the Plan Investor group, following which the rights and   obligations of the Plan Investor under the Plan Funding Agreement will be   assumed by New Amryt. In consideration for the cancellation of each Plan   Investor shareholder’s interest in the Plan Investor, each Plan Investor   shareholder will receive shares in New Amryt and certain contingent value   rights. The New Common Stock is anticipated to be listed for trading on the   Alternative Investment Market operated by the London 50 

    

 

Stock Exchange   plc. (“AIM”) and on the Euronext Growth Market operated by Euronext Dublin   (“Euronext”) and will require the approval of AIM and Euronext for such   admission and trading. The issuance of the New Common Stock is also subject   to confirmation of the Plan. (c) Rights Offering. Purpose. The proceeds of   the sale of the Rights Offering Stock and Plan Investor Equity Raise shall be   used to provide a new equity raise of $60 million — $42 million of which is   on account of the Rights Offering conducted under the Plan and $18 million of   which is on account of the Plan Investor Equity Raise, which shall be   available for ordinary course operations and general corporate purposes.   Rights Offering. In accordance with the New Registration Rights Agreement,   the Rights Offering Procedures and the Backstop Commitment Agreement, and as   provided in the Implementation Memorandum, each Eligible Holder that timely   votes to accept the Plan shall receive Subscription Rights to acquire its   respective Pro Rata Share of Rights Offering Stock pursuant to the terms set   forth in the Plan and in the Rights Offering Procedures. With respect to each   Eligible Holder that timely votes to accept the Plan, each Subscription Right   shall represent the right to acquire one share of Rights Offering Stock for   the Rights Offering Exercise Price. Backstop Commitment. The Plan Investor   Equity Raise will be correspondingly increased by the aggregate amount of the   Rights Offering Amount that is not timely, duly and validly subscribed and   paid for by the Eligible Holders that timely vote to accept the Plan in   accordance with the Rights Offering Procedures, and in accordance with, and   subject to the limitations of the provisions of Backstop Commitment   Agreement, and as further described below, upon exercise of the put option of   the Plan Investor, the Backstop Parties shall be severally, and not jointly,   required to purchase their applicable portion of the Unsubscribed Shares   (allocated pro rata among the Backstop Parties based upon their respective   Backstop Commitments) in the event that the Plan Investor has been unable to   effect a private placement of the entire Plan Investor Equity Raise Amount.   Commitment Fee. On the Effective Date, the Backstop Parties shall receive   from the Plan Investor their respective portion of the Backstop Commitment   Fee pursuant to the terms of the Backstop Commitment Agreement. The Backstop   Commitment Fee shall be fully earned immediately upon the Subscription   Commencement Date and payable by the Plan Investor (and not the Debtors) on   the Effective Date pursuant to the terms and conditions of the Backstop   Commitment Agreement. 51 

    

 

(d) Plan   Funding. The Debtors’ Cash obligations under the Plan will be funded from   Plan Cash and proceeds from the Rights Offering and the Plan Investor Equity   Raise; provided however (i) that only Plan Cash shall be used for payment of   Government Settlement Claims that become due and payable prior to the   Effective Date, DIP Claims, Fee Claims, Ad Hoc Group Fee Claims and the   Convertible Notes Trustee Professional Fees and (ii) only proceeds from the   Rights Offering and Plan Investor Equity Raise will be used to pay the Rebate   Obligations or to repay any portion of the DIP Obligations incurred to pay   Rebate Obligations. (e) New Term Loan Facility; New Convertibles Notes. On   the Effective Date, subject to the Implementation Memorandum, without any   requirement of further action by stockholders or directors of the Debtors,   each of the Reorganized Debtors shall be authorized to enter into the New   Term Loan Facility, in the estimated amount of $81.9 million (which is an   amount equal to (a) the New Money Bridge Loan Claim plus (b) the Existing   Plan Investor Debt), and the New Convertible Notes Indenture, governing approximately   $125 million of New Convertible Notes, as well as any notes, documents or   agreements in connection therewith, including, without limitation, any   documents required in connection with the creation or perfection of the Liens   on any Collateral securing the New Term Loan Facility. (f) Authorization,   Issuance and Delivery of Plan Securities by the Plan Investor. (a) On the   Effective Date, subject to the Implementation Memorandum, the Plan Investor   is authorized to issue or cause to be issued those Plan Securities to be   issued by it in accordance with the terms of the Plan and the Plan Funding   Agreement and to take any and all action associated therewith, without the   need for any further Bankruptcy Court, corporate, limited liability company,   member or shareholder action. (b) On the Effective Date, subject to the   Implementation Memorandum, the Plan Investor shall issue and cause to be   delivered the New Common Stock and the New Warrants available in the New   Common Stock Distribution to the Reorganized Debtors, who will then deliver   such New Common Stock and New Warrants directly to the holders of the   Novelion Intercompany Loan Claims and Other General Unsecured Claims in   accordance with the terms the Plan. (c) On the Effective Date, subject to the   Implementation Memorandum, the Plan Investor shall issue and cause to be   delivered the Rights Offering Stock to the Reorganized Debtors, who will then   deliver such Rights Offering Stock directly to Eligible Holders who vote in   favor of the Plan and exercise their Subscription Rights in accordance with   the terms of the Plan, the Rights Offering Procedures, and the Backstop   Commitment Agreement. (d) As a condition to receiving any Plan Securities   under the Plan or pursuant to the Rights Offering or the Plan Investor Equity   Raise, the Bridge Lenders shall have executed and delivered to the Plan   Investor a signature page to the New Registration Rights Agreement. The New   Registration Rights Agreement shall be executed and in full force and effect   on the Effective Date. 52 

    

 

(e)   Notwithstanding anything to the contrary in the Plan, (x) any Person that   would be entitled to receive more than 9.99% (but no more than 15%) of the   aggregate amount of the New Common Stock issued as of the Effective Date (excluding   New Common Stock issued pursuant to any management incentive plan and any New   Common Stock reserved for issuance to any person other than such Person   pursuant to New Warrants or the New Convertible Notes or any other warrant,   option or agreement) or (y) with the consent of the Debtors and Plan   Investor, any other Person entitled to receive New Common Stock thereunder,   may elect to receive New Warrants on a one-for-one basis in lieu of all or   any portion of the shares of New Common Stock that would otherwise be issued   to such Person under the Plan; provided that such Person notifies the Debtors   in writing of such election (and the percentage of shares of New Common Stock   to be issuable thereunder) no later than two (2) Business Days after the   Confirmation Date, provided, further, that, with respect to clause (x),   without the consent of the Debtors and the Plan Investor, such Person may   only elect to receive New Warrants in lieu of such portion of New Common   Stock that would otherwise be issued to such Person under the Plan in excess   of 7.5% of the aggregate amount of New Common Stock issued as of the   Effective Date (excluding New Common Stock issued pursuant to any management   incentive plan and any New Common Stock reserved for issuance to any person other   than such Person pursuant to New Warrants or the New Convertible Notes or any   other warrant, option or agreement). (f) Notwithstanding anything to the   contrary in the Plan, (x) any Person that would be entitled to receive more   than 4.99% (but no more than 6.0%) of the aggregate amount of the New Common   Stock issued as of the Effective Date (excluding New Common Stock issued   pursuant to any management incentive plan and any New Common Stock reserved   for issuance to any person other than such Person pursuant to New Warrants or   the New Convertible Notes or any other warrant, option or agreement) or (y)   with the consent of the Debtors and Plan Investor, any other Person entitled   to receive New Common Stock under the Plan, may elect to receive New Warrants   on a one-for-one basis in lieu of all or any portion of the shares of New   Common Stock that would otherwise be issued to such Person under the Plan;   provided that such Person notifies the Debtors in writing of such election   (and the percentage of shares of New Common Stock to be issuable thereunder)   no later than two (2) Business Days after the Confirmation Date, provided,   further, that, with respect to clause (x), without the consent of the Debtors   and the Plan Investor, such Person may only elect to receive New Warrants in   lieu of such portion of New Common Stock that would otherwise be issued to   such Person under the Plan in excess of 4.5% of the aggregate amount of New   Common Stock issued as of the Effective Date (excluding New Common Stock   issued pursuant to any management incentive plan and any New Common Stock   reserved for issuance to any person other than such Person pursuant to New   Warrants or the New Convertible Notes or any other warrant, option or   agreement). (g) Continued Corporate Existence and Vesting of Assets. (i)   General. (1) Except as otherwise provided in the Plan, the Debtors shall   continue to exist after the Effective Date as Reorganized Debtors in   accordance with the applicable laws of the respective jurisdictions in which   they are 53 

    

 

incorporated or   organized and pursuant to the Amended Certificates of Formation for the   purposes of satisfying their obligations under the Plan and the continuation   of their business. On or after the Effective Date, each Reorganized Debtor,   in its discretion, may take any and all action as permitted by applicable law   and such Reorganized Debtor’s organizational documents, as such Reorganized   Debtor may determine is reasonable and appropriate, including, but not   limited to, causing: (w) a Reorganized Debtor to be merged into another   Reorganized Debtor, or its Subsidiary and/or affiliate; (x) a Reorganized   Debtor to be dissolved; (y) the legal name of a Reorganized Debtor to be   changed; or (z) the closure of a Reorganized Debtor’s case on the Effective   Date or any time thereafter. (2) On the Effective Date or as soon as   reasonably practicable thereafter, the Reorganized Debtors may take any and   all action as may be necessary or appropriate to effect any transaction   described in, approved by, contemplated by, or necessary to effectuate the   Plan, including: (1) the execution and delivery of appropriate agreements or   other documents of merger, consolidation, restructuring, conversion,   disposition, transfer, dissolution or liquidation containing terms that are   consistent with the terms of the Plan and that satisfy the applicable   requirements of applicable law and any other terms to which the applicable   entities may agree; (2) the execution and delivery of appropriate instruments   of transfer, assignment, assumption or delegation of any asset, property,   right, liability, debt or obligation on terms consistent with the terms of   the Plan and having other terms for which the applicable parties agree; (3)   the filing of appropriate certificates or articles of incorporation,   reincorporation, merger, consolidation, conversion or dissolution pursuant to   applicable state law; and (4) all other actions that the applicable entities   determine to be necessary or appropriate, including making filings or   recordings that may be required by applicable law. Revesting of Assets.   Except as otherwise provided in the Plan, on and after the Effective Date,   all property of the Estates, wherever located, including all claims, rights   and Causes of Action and any property, wherever located, acquired by the   Debtors under or in connection with the Plan, shall revest in the Reorganized   Debtors, as applicable, free and clear of all Claims, Liens, charges, other   encumbrances and Interests. On and after the Effective Date, except as otherwise   provided in the Plan, each applicable Reorganized Debtor may operate its   business and may use, acquire and dispose of property, wherever located, and   each Reorganized Debtor may prosecute, compromise or settle any Claims   (including any Administrative Expense Claims) and Causes of Action without   supervision of or approval by the Bankruptcy Court and free and clear of any   restrictions of the Bankruptcy Code or the Bankruptcy Rules other than   restrictions expressly imposed by the Plan or the Confirmation Order. Without   limiting the foregoing, the Reorganized Debtors may pay the charges that they   incur on or after the Effective Date for Professional Persons’ fees,   disbursements, expenses or related support services without application to   the Bankruptcy Court. (h) Cancellation of Existing Securities and Agreements.   54 

    

 

Except for the   purpose of evidencing a right to distribution under the Plan, and except as   otherwise set forth in the Plan (including Section 2.3 thereof), on the Effective   Date, subject to the Implementation Memorandum, all agreements, including all   intercreditor agreements, instruments, and other documents evidencing,   related to or connected with any Claim or Interest, other than Intercompany   Interests, and any rights of any holder in respect thereof, shall be deemed   cancelled, discharged and of no force or effect. The holders of or parties to   such cancelled instruments, securities and other documentation will have no   rights arising from or relating to such instruments, securities and other   documentation or the cancellation thereof, except the rights provided for   pursuant to the Plan. Notwithstanding anything to the contrary in the Plan,   each of the Bridge Loan Credit Agreement, Novelion Intercompany Loan Credit   Agreement and the Convertible Notes Indenture shall continue in effect solely   to the extent necessary to: (a) permit holders of Bridge Loan Claims,   Novelion Intercompany Loan Claims and Convertible Notes Claims to receive   Plan Distributions on account of such respective claims; (b) permit the   Bridge Loan Administrative Agent and the Convertible Notes Trustee to seek   compensation and/or reimbursement of fees and expenses in accordance with the   terms of the Plan and/or the Convertible Notes Indenture, including through   the exercise of the charging Lien provided under the Convertible Notes   Indenture; and (c) preserving the right of the Convertible Notes Indenture   Trustee to indemnification from the Debtors pursuant and subject to the of   the Convertible Notes Indenture. Except as provided pursuant to the Plan,   upon satisfaction of the Bridge Loan Claims and Convertible Notes Claims,   each of the Bridge Loan Administrative Agent and the Convertible Notes   Trustee, shall be discharged of all of their respective obligations associated   with the Bridge Loan and the Convertible Notes, respectively. (i) Boards. As   of the Effective Date, the initial board of directors of each of the   Reorganized Debtors and the Plan Investor shall consist of those individuals   set forth in the Plan Supplement to be filed with the Bankruptcy Court on or   before the date of the Confirmation Hearing. The compensation arrangement for   any insider of the Debtors that shall become an officer of a Reorganized   Debtor or the Plan Investor shall be disclosed in the Plan Supplement and   selected in accordance with the terms set forth in the New Registration   Rights Agreement. Unless reappointed pursuant to Section 7.9(a) of the Plan,   the members of the board of directors of each Debtor prior to the Effective   Date shall have no continuing obligations to the Reorganized Debtors in their   capacities as such on and after the Effective Date, each such member shall be   deemed to have resigned or shall otherwise cease to be a director of the   applicable Debtor on the Effective Date. Commencing on the Effective Date,   each of the directors of each of the Reorganized Debtors shall serve pursuant   to the terms of the applicable organizational documents of such Reorganized   Debtor and may be replaced or removed in accordance with such organizational   documents. (j) Management. As of the Effective Date, the individuals who will   serve in certain senior management positions of the Reorganized Debtors shall   consist of those individuals set forth in the Plan Supplement and shall be   Acceptable to the Debtors and each of the Required Parties in 55 

    

 

accordance with   the applicable terms of the Transaction Documents. The compensation   arrangement for any insider of the Debtors that shall become an officer of a   Reorganized Debtor shall be in form and substance Acceptable to the Debtors   and each of the Required Parties and disclosed in the Plan Supplement to be   filed with the Bankruptcy Court on or before the date of the Confirmation   Hearing. (k) Corporate Action. The Reorganized Debtors shall serve on the   U.S. Trustee quarterly reports of the disbursements made by each Reorganized   Debtor on an entity-by-entity basis, within 15 days after the conclusion of   each such period, until such time as a final decree is entered closing the applicable   Chapter 11 Case or the applicable Chapter 11 Case is converted or dismissed.   Any such reports shall be prepared consistent with (both in terms of content   and format) any applicable Bankruptcy Court and U.S. Trustee guidelines. Any   deadline for filing Administrative Expense Claims shall not apply to U.S.   Trustee Fees. On the Effective Date, the Amended Memorandum of Association,   the Amended Certificates of Formation and any other applicable amended and   restated corporate organizational documents of each of the Reorganized   Debtors shall be deemed authorized in all respects. Any action under the Plan   to be taken by or required of the Debtors or the Reorganized Debtors,   including the adoption or amendment of certificates of formation,   incorporation and by-laws, the issuance of securities and instruments, or the   selection of officers or directors shall be authorized and approved in all   respects, without any requirement of further action by any of the Debtors’ or   the Reorganized Debtors’ equity holders, sole members, boards of directors or   boards of managers, or similar body, as applicable. The Debtors and the   Reorganized Debtors shall be authorized to execute, deliver, file, and record   such documents (including the Plan Documents), contracts, instruments,   releases and other agreements and take such other action as may be necessary   to effectuate and further evidence the terms and conditions of the Plan,   without the necessity of any further Bankruptcy Court, corporate, limited   liability company, board, member, or shareholder approval or action. In   addition, the selection of the Persons who will serve as the initial   directors, officers and managers of the Reorganized Debtors as of the   Effective Date shall be deemed to have occurred and be effective on and after   the Effective Date without any requirement of further action by the board of   directors, board of managers, or equity holders of the applicable Reorganized   Debtor. (l) Ad Hoc Group Fee Claim. On the Effective Date or as soon as   reasonably practicable thereafter, the Debtors or the Reorganized Debtors   shall pay the Ad Hoc Group Fee Claim from Plan Cash.26 (m) Payment of   Convertible Notes Trustee Fees. 26 The U.S. Trustee reserves all rights to   object to the Plan at the Confirmation Hearing, including payment of the Ad   Hoc Group Fee Claim. 56 

    

 

On the   Effective Date, the Debtors shall pay in Cash all unpaid Convertible Notes   Trustee Fees from Plan Cash, regardless of whether such fees and expenses   were incurred before or after the Petition Date, without application by any   party to the Bankruptcy Court and without notice and a hearing pursuant to   section 1129(a)(4) of the Bankruptcy Code or otherwise. Notwithstanding   anything to the contrary in the Plan, the Convertible Notes Trustee Professional   Fees shall not be subject to the Administrative Bar Date. (n) Comprehensive   Settlement of Claims and Controversies. Pursuant to Bankruptcy Rule 9019 and   in consideration for the distributions and other benefits provided under the   Plan, the provisions of the Plan will constitute a good faith compromise and   settlement of all Claims or controversies relating to the rights that a   holder of a Claim or Interest may have with respect to any Allowed Claim or   Allowed Interest or any distribution to be made pursuant to the Plan on   account of any Allowed Claim or Allowed Interest. The entry of the   Confirmation Order will constitute the Bankruptcy Court’s approval, as of the   Effective Date, of the compromise or settlement of all such claims or   controversies and the Bankruptcy Court’s finding that all such compromises or   settlements are: (i) in the best interest of the Debtors, the Reorganized   Debtors, and their respective Estates and property, and of holders of Claims   or Interests; and (ii) fair, equitable and reasonable. (o) Additional   Transactions Authorized Under the Plan. On or prior to the Effective Date, as   shall be Acceptable to the Required Parties, the Debtors shall be authorized   to take any such actions as may be necessary or appropriate to reinstate Claims   or Interests or render Claims or Interests not impaired, as provided for   under the Plan. (p) Shared Services Agreements. The Shared Services   Agreements, as amended, shall be assumed by order of the Bankruptcy Court and   shall terminate on the Effective Date in accordance with the terms of the   Shared Services Agreements. (q) Acceptable. As used in the Plan, the term   “Acceptable” shall mean (x) when in reference to any document, or any   amendment, modification or change to such document, in form and substance   reasonably acceptable to the applicable parties, and (y) when in reference to   any individual, reasonably acceptable to the applicable parties. 6.8.   Executory Contracts and Unexpired Leases. (a) General Treatment. As of and   subject to the occurrence of the Effective Date and the payment of any   applicable Cure Amount, all executory contracts and unexpired leases of the   Debtors shall be deemed assumed, except that: (a) any executory contracts and   unexpired leases that previously have been assumed or rejected pursuant to a   Final Order of the Bankruptcy Court shall be treated 57 

    

 

as provided in   such Final Order; (b) any executory contracts and unexpired leases listed on   the Schedule of Rejected Contracts and Leases shall be deemed rejected as of   the Effective Date; and (c) all executory contracts and unexpired leases that   are the subject of a separate motion to assume or reject under section 365 of   the Bankruptcy Code pending on the Effective Date shall be treated as   provided for in the Final Order resolving such motion. Subject to the   occurrence of the Effective Date, entry of the Confirmation Order by the   Bankruptcy Court shall constitute approval of the assumptions and rejections   described in this Section 10.1 pursuant to sections 365(a) and 1123 of the   Bankruptcy Code. Each executory contract and unexpired lease assumed pursuant   to this Section 10.1 shall revest in and be fully enforceable by the   applicable Reorganized Debtor in accordance with its terms, except as   modified by the provisions of the Plan, or any order of the Bankruptcy Court   authorizing and providing for its assumption, or applicable federal law.   Without determining whether any of the Government Settlement Agreements is an   executory contract subject to section 365 of the Bankruptcy Code, the   Government Settlement Agreements shall be deemed assumed by the Debtors, and   binding upon the Reorganized Debtors and the applicable parties thereto as of   and following the Effective Date (provided that the foregoing shall not   constitute a determination whether such agreements are executory contracts   subject to section 365 of the Bankruptcy Code). Nothing in the foregoing   paragraph affects or limits the provisions of Section 12.6(d)-(e) of the   Plan. Aegerion holds an exclusive worldwide license to research, develop,   commercialize, make, have made, use, import, offer for sale and sell Juxtapid   in the United States and Lojuxta in Europe pursuant to that certain Patent   License Agreement, by and between The Trustees of the University of   Pennsylvania (“Penn”) and Aegerion, dated May 19, 2006 (as amended by the   First Amendment to Patent License Agreement, effective as of September 27,   2006, the “Patent License”). Aegerion intends to assume the Patent License as   well as any sub-licenses granted thereunder or in connection therewith, cure   all defaults and pay any outstanding amounts which may be owed. Aegerion also   intends to assume all other outstanding contracts with Penn, cure all   defaults, if any, and pay any amounts owing thereunder. The Debtors recognize   that their agreements with Penn are material to the Debtors and thus, the   Debtors and Penn intend to work cooperatively to determine any royalties,   sublicense fees or other amounts (if any) which may be due to Penn as a Cure   Amount under any of the above agreements in order to successfully assume such   agreements for the Debtors’ go-forward business. (b) Claims Based on   Rejection of Executory Contracts or Unexpired Leases. Except as otherwise   explicitly set forth in the Plan, all Claims arising from the rejection of   executory contracts or unexpired leases, if evidenced by a timely filed proof   of claim, will be treated as Other General Unsecured Claims. Upon receipt of   the Plan Distribution provided in Section 5.7 of the Plan, all such Claims   shall be discharged as of the Effective Date, and shall not be enforceable   against the Debtors, the Estates, the Reorganized Debtors or their respective   properties or interests in property. In the event that the rejection of an   executory contract or unexpired lease by any of the Debtors pursuant to the   Plan results in damages to the other party or parties to such contract or   lease, a Claim for such damages, if not evidenced by a timely filed proof of   claim, shall be forever barred and shall not be enforceable against the   Debtors or the Reorganized Debtors, or their respective properties or   interests in property as agents, successors or assigns, unless a proof of   claim is filed with the Bankruptcy Court and served upon counsel for the   Debtors and the Reorganized Debtors on or before the date that is 58 

    

 

thirty (30)   days after the effective date of such rejection (which may be the Effective   Date, the date on which the Debtors reject the applicable contract or lease   as provided in Section 10.3(c) below, or pursuant to an order of the   Bankruptcy Court). (c) Cure of Defaults for Assumed Executory Contracts and   Unexpired Leases. Except to the extent that less favorable treatment has been   agreed to by the non-Debtor party or parties to each such executory contract   or unexpired lease to be assumed pursuant to the Plan, any monetary defaults arising   under such executory contract or unexpired lease shall be satisfied, pursuant   to section 365(b)(1) of the Bankruptcy Code, by payment of the appropriate   amount (the “Cure Amount”) in full in Cash on the later of thirty (30) days   after: (i) the Effective Date; or (ii) the date on which any Cure Dispute   relating to such Cure Amount has been resolved (either consensually or   through judicial decision). No later than ten (10) calendar days prior to the   commencement of the Confirmation Hearing, the Debtors, in consultation with   the Plan Investor, shall file a schedule (the “Cure Schedule”) setting forth   the Cure Amount, if any, for each executory contract and unexpired lease to   be assumed pursuant to Section 10.1 of the Plan, and serve such Cure Schedule   on each applicable counterparty. Any party that fails to object to the   applicable Cure Amount listed on the Cure Schedule within ten (10) calendar   days of the filing thereof shall be forever barred, estopped and enjoined   from disputing the Cure Amount set forth on the Cure Schedule (including a   Cure Amount of $0.00) and/or from asserting any Claim against the applicable   Debtor or Reorganized Debtor arising under section 365(b)(1) of the   Bankruptcy Code except as set forth on the Cure Schedule. In the event of a   dispute (each, a “Cure Dispute”) regarding: (i) the Cure Amount; (ii) the   ability of the applicable Reorganized Debtor to provide “adequate assurance   of future performance” (within the meaning of section 365 of the Bankruptcy   Code) under the contract or lease to be assumed; or (iii) any other matter   pertaining to the proposed assumption, the cure payments required by section   365(b)(1) of the Bankruptcy Code shall be made following the entry of a Final   Order resolving such Cure Dispute and approving the assumption. To the extent   a Cure Dispute relates solely to the Cure Amount, the applicable Debtor may   assume and/or assume and assign the applicable contract or lease prior to the   resolution of the Cure Dispute provided that such Debtor reserves Cash in an   amount sufficient to pay the full amount asserted as the required cure   payment by the non-Debtor party to such contract or lease (or such smaller   amount as may be fixed or estimated by the Bankruptcy Court). To the extent   the Cure Dispute is resolved or determined against the applicable Debtor or   Reorganized Debtor, as applicable, such Debtor or Reorganized Debtor, as   applicable, may reject the applicable executory contract or unexpired lease   after such determination, and the counterparty may thereafter file a proof of   claim in the manner set forth in Section 10.2 of the Plan. (d) Effect of   Confirmation Order on Assumption, Assumption and Assignment, and Rejection.   Subject to the occurrence of the Effective Date, entry of the Confirmation   Order by the Bankruptcy Court shall constitute entry of an order by the   Bankruptcy Court pursuant to sections 365(a) and 1123(b) of the Bankruptcy   Code approving the assumptions, assumptions 59 

    

 

and assignments   and rejections described in this Article X and determining that: (a) with   respect to such rejections, such rejected executory contracts and unexpired   leases are burdensome and that the rejection therein is in the best interests   of the Estates; (b) with respect to such assumptions, to the extent   necessary, that the applicable Reorganized Debtor has (i) cured, or provided   adequate assurance that the applicable Reorganized Debtor will promptly cure,   any default in accordance with section 365(b)(1)(A) of the Bankruptcy Code,   (ii) compensated or provided adequate assurance that it or its affiliate will   promptly compensate the counterparty for any actual pecuniary loss to such   party resulting from such default, and (iii) provided adequate assurance of   future performance under such executory contract or unexpired lease; and (c)   with respect to any assignment, to the extent necessary, that the applicable   Reorganized Debtor or the proposed assignee has (i) cured, or provided   adequate assurance that it or its affiliate will promptly cure, any default   in accordance with section 365(b)(1)(A) of the Bankruptcy Code, (ii)   compensated or provided adequate assurance that the applicable Reorganized   Debtor or the proposed assignee will promptly compensate the counterparty for   any actual pecuniary loss to such party resulting from such default, and   (iii) that “adequate assurance of future performance” (within the meaning of   section 365 of the Bankruptcy Code) by the assignee has been demonstrated and   no further adequate assurance is required. Assumption of any executory   contract or unexpired lease and satisfaction of the Cure Amounts shall result   in the full discharge, release and satisfaction of any claims or defaults,   whether monetary or nonmonetary, including defaults of provisions restricting   the change in control or ownership interest composition or other   bankruptcy-related defaults, arising under any assumed executory contract or   unexpired lease at any time before the date such executory contract or   unexpired lease is assumed. Each executory contract and unexpired lease   assumed pursuant to this Article X shall revest in and be fully enforceable   by the applicable Debtor in accordance with its terms, except as modified by   the provisions of the Plan, or any order of the Bankruptcy Court authorizing   and providing for its assumption, or applicable federal law. To the maximum   extent permitted by law, to the extent any provision in any executory   contract or unexpired lease assumed pursuant to the Plan restricts or prevents,   or purports to restrict or prevent, or is breached or deemed breached by, the   assumption of such executory contract or unexpired lease (including any   “change of control” provision), then such provision shall be deemed modified   such that the transactions contemplated by the Plan shall not entitle the   non-Debtor party thereto to terminate such executory contract or unexpired   lease or to exercise any other default-related rights with respect thereto.   Any party that fails to timely file a Cure Dispute on the basis that consent   to assume or assume and assign the applicable executory contract is a   condition to such assumption or assumption and assignment, shall be deemed to   have consented to the assumption or assumption and assignment, as applicable,   of such contract. (e) Modifications, Amendments, Supplements, Restatements,   or Other Agreements. Unless otherwise provided in the Plan, each assumed or   assumed and assigned executory contract and unexpired lease shall include all   modifications, amendments, supplements, restatements or other agreements that   in any manner affect such executory contract or unexpired lease, and all   executory contracts and unexpired leases related thereto, if any, including   all easements, licenses, permits, rights, privileges, immunities, options,   rights of first refusal and any other interests, unless any of the foregoing   agreements has been previously rejected or is rejected under the Plan or   otherwise. 60 

    

 

Modifications,   amendments, supplements and restatements to prepetition executory contracts   and unexpired leases that have been executed by the Debtors during the   Chapter 11 Cases shall not be deemed to alter the prepetition nature of the   executory contract or unexpired lease, or the validity, priority or amount of   any Claims that may arise in connection therewith. (f) Compensation and   Benefit Programs. Subject to the paragraph immediately following this   paragraph, and except as otherwise expressly provided in the Plan, the Plan   Funding Agreement, in a prior order of the Bankruptcy Court or to the extent   subject to a motion pending before the Bankruptcy Court as of the Effective   Date, all employment and severance policies, and all compensation and benefit   plans, policies, and programs of the Debtors applicable to their respective   employees, retirees and non-employee directors including all savings plans,   unfunded retirement plans, healthcare plans, disability plans, severance   benefit plans, incentive plans, and life, accidental death and dismemberment   insurance plans, and paid time off policies, in each case, as existing on the   Petition Date, are treated as executory contracts under the Plan and, on the   Effective Date, will be assumed pursuant to the provisions of sections 365   and 1123 of the Bankruptcy Code except for Persons not employees of the   Debtors as of the Petition Date. Each of the Debtors may, prior to the   Effective Date and subject to the parties’ rights under the RSA and the Plan   Funding Agreement, enter into employment agreements with employees that become   effective on or prior to the Effective Date and survive consummation of the   Plan. Any such agreements (or a summary of the material terms thereof) shall   be in form and substance Acceptable to the Plan Investor and be included in   the Plan Supplement or otherwise filed with the Bankruptcy Court on or before   the date of the Confirmation Hearing. On the Effective Date, the Debtors or   the Reorganized Debtors, as applicable, shall pay any amounts outstanding   under the Debtors’ key executive incentive program and key employee retention   plan authorized to be paid as of that date pursuant to an order of the   Bankruptcy Court. For the avoidance of doubt, and notwithstanding anything in   the Plan to the contrary, any payments of amounts outstanding under the   Debtors’ key executive incentive program and key employee retention plan   authorized to be paid as of the Effective Date pursuant to an order to the   Bankruptcy Court or otherwise, including, without limitation, any and all   amounts that are outstanding or will become outstanding as a result of any   “change of control” or similar transaction shall be paid from Plan Cash. 6.9.   Binding Effect. Except as otherwise provided in section 1141(d)(3) of the   Bankruptcy Code and subject to the occurrence of the Effective Date, on and   after the Confirmation Date, the provisions of the Plan shall bind any holder   of a Claim against, or Interest in, the Debtors and inure to the benefit of   and be binding on such holder’s respective successors and assigns, whether or   not the Claim or Interest of such holder is impaired under the Plan and   whether or not such holder has accepted the Plan. 6.10. Discharge of Claims   Against and Interests in the Debtors. 61 

    

 

Upon the   Effective Date and in consideration of the Plan Distributions, if any, except   as otherwise provided in the Plan or in the Confirmation Order, each Person   that is a holder (as well as any trustees and agents for or on behalf of such   Person) of a Claim or Interest shall be deemed to have forever waived,   released, and discharged the Debtors, to the fullest extent permitted by   section 1141 of the Bankruptcy Code, of and from any and all Claims,   Interests, rights and liabilities that arose prior to the Effective Date.   Except as otherwise provided in the Plan, upon the Effective Date, all such   holders of Claims and Interests shall be forever precluded and enjoined,   pursuant to sections 105, 524 and 1141 of the Bankruptcy Code, from   prosecuting or asserting any such discharged Claim against or terminated   Interest in any Debtor, any Reorganized Debtor. For the avoidance of doubt,   ancillary security enforcement, insolvency processes and/or other proceedings   may be deployed in any relevant jurisdictions to implement the transactions   set out in the Plan, including the Plan’s discharge provisions, in order to   ensure that they are fully effective. 6.11. Term of Pre-Confirmation   Injunctions or Stays. Unless otherwise provided in the Plan, all injunctions   or stays provided in the Chapter 11 Cases arising prior to the Confirmation   Date in accordance with sections 105 or 362 of the Bankruptcy Code, or   otherwise, and in existence on the Confirmation Date, shall remain in full   force and effect until the Effective Date. 62 

    

 

6.12.   Injunction Against Interference with the Plan. Upon the entry of the   Confirmation Order, all holders of Claims and Interests and other Persons,   along with their respective present or former affiliates, employees, agents,   officers, directors, or principals, shall be enjoined from taking any   actions, whether in the United States or elsewhere, to interfere with the   implementation or consummation of the Plan. Moreover, solely to the extent   provided under applicable law, the property dealt with by the Plan is   transferred to, or vests in (or both, as applicable) the Reorganized Debtors   free and clear of all Claims and Interests pursuant to section 1141(c) of the   Bankruptcy Code. As such, to the fullest extent permissible under applicable   law, no Person holding a Claim or Interest may receive any payment from, or   seek recourse against, any assets that are to be distributed under the Plan   other than assets required to be distributed to that Person under the Plan.   As of the Confirmation Date, subject to the occurrence of the Effective Date,   to the fullest extent permissible under applicable law, all Persons are   precluded and barred from asserting against any property to be distributed   under the Plan any Claims, rights, Causes of Action, liabilities, Interests,   or other action or remedy based on any act, omission, transaction, or other   activity that occurred before the Confirmation Date except as expressly   provided in the Plan or the Confirmation Order. Each of the Reorganized   Debtors, as applicable, is expressly authorized hereby to seek to enforce   such injunction. Injunction.27 6.13. Except as otherwise provided in the   Plan, including Section 12.8, or the Confirmation Order, as of the   Confirmation Date, but subject to the occurrence of the Effective Date, all   Persons who have held, hold or may hold Claims against or Interests in the   Debtors or the Estates are, with respect to any such Claims or Interests,   permanently enjoined after the Confirmation Date from: (i) commencing,   conducting or continuing in any manner, directly or indirectly, any suit,   action or other proceeding of any kind (including any proceeding in a   judicial, arbitral, administrative or other forum) against the Released   Parties, the Reorganized Debtors, the Estates or any of their property,   wherever located, or any direct or indirect transferee of any property,   wherever located, of, or direct or indirect successor in interest to, any of   the foregoing Persons or any property, wherever located, of any such   transferee or successor, on account of or in connection with or with respect   to any released, settled, compromised, or exculpated Claims, Interests or   Causes of Action arising against the Debtors and/or their Estates; (ii)   enforcing, levying, attaching (including any pre-judgment attachment),   collecting or otherwise recovering by any manner or means, whether directly   or indirectly, any judgment, award, decree or order against the Released   Parties, the Reorganized Debtors, Estates or any of their property, wherever   located, or any direct or indirect transferee of any property, wherever   located, of, or direct or indirect successor in interest to, any of the   foregoing Persons, or any property, wherever located, of any such transferee   or successor, on account of or in connection with or with respect to any   released, settled, compromised, or exculpated Claims, Interests or 27 The SEC   is continuing to review the terms of the Plan and reserves all rights with   respect to the terms thereof, including Sections 12.5 and 12.8 of the Plan. 63   

    

 

Causes of   Action arising against the Debtors and/or their Estates; (iii) creating,   perfecting or otherwise enforcing in any manner, directly or indirectly, any   encumbrance of any kind against the Released Parties, the Reorganized Debtors,   or the Estates or any of their property, wherever located, or any direct or   indirect transferee of any property, wherever located, of, or successor in   interest to, any of the foregoing Persons, on account of or in connection   with or with respect to any released, settled, compromised, or exculpated   Claims, Interests or Causes of Action arising against the Debtors and/or   their Estates; (iv) acting or proceeding in any manner, in any place   whatsoever, that does not conform to or comply with the provisions of the   Plan to the full extent permitted by applicable law; and (v) commencing or   continuing, in any manner or in any place, any action that does not comply   with or is inconsistent with the provisions of the Plan; provided, however,   that nothing contained in the Plan shall preclude such Persons from   exercising their rights, or obtaining benefits, pursuant to and consistent   with the terms of the Plan. For the avoidance of doubt, ancillary security   enforcement, insolvency processes and/or other proceedings may be deployed in   any relevant jurisdictions to implement the transactions set out in the Plan,   including the injunctions set forth in this Section 12.5, in order to ensure   that they are fully effective. Each of the Reorganized Debtors, as   applicable, is expressly authorized hereby to seek to enforce such   injunction. 6.14. Releases. (a) Releases by the Debtors. Except as otherwise   provided in the Plan or the Confirmation Order, as of the Effective Date, the   Debtors, as, debtors in possession, and any person seeking to exercise the   rights of the Debtors’ Estates, including without limitation, any successor   to the Debtors or any representative of the Debtors’ Estates appointed or   selected pursuant to sections 1103, 1104 or 1123(b)(3) of the Bankruptcy Code   or under chapter 7 of the Bankruptcy Code, shall be deemed to forever   release, waive and discharge all claims (as such term “claim” is defined in   section 101(5) of the Bankruptcy Code), obligations, suits, judgments,   damages, demands, debts, rights, causes of action (including, but not limited   to, the Causes of Action) and liabilities (other than the rights of the   Debtors to enforce the Plan and the contracts, instruments, releases and   other agreements or documents delivered thereunder) against any Released Party,   whether liquidated or unliquidated, fixed or contingent, matured or   unmatured, known or unknown, foreseen or unforeseen, existing or hereafter   arising, in law, equity or otherwise that are based in whole or in part on   any act, omission, transaction, event or other occurrence taking place on or   prior to the Effective Date in any way relating to the Debtors, the   Reorganized Debtors, the purchase, sale or rescission of the purchase or sale   of any security of the Debtors, the subject matter of, or the transactions or   events giving rise to, any Claim or Interest that is treated in the Plan, the   parties released pursuant to this Section 12.6, the Chapter 11 Cases, the   RSA, the DIP Financing Agreement, the Plan Funding Agreement, or the Plan or   the Disclosure Statement, and that could have been asserted by or on behalf   of the Debtors or their Estates, whether directly, indirectly, derivatively   or in any representative or any other capacity; provided, however, that in no   event shall anything in this Section 12.06(a) be construed as a release of   any Person’s gross negligence, fraud, or willful misconduct, each as   determined by a Final Order, for matters with respect to the Debtors and/or   their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy   Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases in the   Plan, which includes by reference each of the related provisions and   definitions 64 

    

 

contained in   the Plan, and further, shall constitute the Bankruptcy Court’s finding that   the releases in the Plan are: (1) in exchange for the good and valuable   consideration provided by the Released Parties; (2) a good faith settlement   and compromise of the claims released by the releases in the Plan; (3) in the   best interests of the Debtors and all holders of Claims and Interests; (4)   fair, equitable and reasonable; (5) given and made after reasonable   investigation by the Debtors and after notice and opportunity for hearing;   and (6) a bar to any of the Debtors asserting any claim released by the   releases in the Plan against any of the Released Parties. (b) Third Party   Releases. Except as otherwise provided in the Plan, the Plan Funding   Agreement or the Confirmation Order, on the Effective Date each Releasing   Party, in consideration for the obligations of the Debtors under the Plan,   the distributions under the Plan and other contracts, instruments, releases,   agreements or documents executed and delivered in connection with the Plan,   will be deemed to have consented to the Plan and the restructuring embodied   in the Plan for all purposes and deemed to forever release, waive and   discharge all claims (as such term is defined in section 101(5) of the   Bankruptcy Code), including but not limited to any claim sounding in law or   equity or asserting a tort, breach of any duty or contract, violations of the   common law, any federal or state statute, any federal or state securities   laws or otherwise, demands, debts, rights, causes of action (including   without limitation, the Causes of Action) or liabilities (other than the   right to enforce the obligations of any party under the Plan and the   contracts, instruments, releases, agreements and documents delivered under or   in connection with the Plan), including, without limitation, any claims for   any such loss such holder may suffer, have suffered or be alleged to suffer   as a result of the Debtors commencing the Chapter 11 Cases or as a result of   the Plan being consummated, against any Released Party, whether liquidated or   unliquidated, fixed or contingent, matured or unmatured, known or unknown,   foreseen or unforeseen, existing or hereafter arising, in law, equity or   otherwise that are based in whole or in part on any act or omission,   transaction, event or other occurrence taking place on or prior to the   Effective Date in any way relating to the Debtors, the Reorganized Debtors,   the Chapter 11 Cases, the Plan or the Disclosure Statement; provided,   however, that in no event shall anything in this Section 12.06(b) be   construed as a release of any Person’s gross negligence, fraud, or willful   misconduct, each as determined by a Final Order, for matters with respect to   the Debtors and/or their affiliates. Entry of the Confirmation Order shall   constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019,   of the releases of holders of Claims and Interests, which includes by   reference each of the related provisions and definitions contained in the   Plan, and further, shall constitute the Bankruptcy Court’s finding that the   releases in the Plan are: (1) in exchange for the good and valuable   consideration provided by the Released Parties; (2) a good faith settlement   and compromise of the claims in the Plan; (3) in the best interests of the   Debtors and all holders of Claims and Interests; (4) fair, equitable and   reasonable; (5) given and made after notice and opportunity for hearing; and   (6) a bar to any holder of a Claim or Interest asserting any Claim released   by the releases in the Plan against any of the Released Parties. (c)   Notwithstanding anything to the contrary contained in the Plan: (i) except to   the extent permissible under applicable law, as such law may be extended or   interpreted subsequent to the Effective Date, the releases provided for in   this Section 12.06 of the Plan shall not release any non-Debtor entity from   any liability arising under (a) the 65 

    

 

Internal   Revenue Code or any state, city or municipal tax code, (b) any criminal laws   of the United States or any state, city or municipality, or (c) any   environmental laws of the United States or any state, city or municipal tax   code; and (ii) the releases set forth in this Section 12.06 shall not release   any (a) claims, right, or Causes of Action for money borrowed from or owed to   the Debtors by any of their directors, officers or former employees, as set   forth in the Debtors’ books and records, (b) any claims against any Person to   the extent such Person asserts a crossclaim, counterclaim and/or claim for   setoff which seeks affirmative relief against a Debtor or any of its   officers, directors, or representatives, (c) claims against any Person   arising from or relating to such Person’s gross negligence, fraud, or willful   misconduct, each as determined by a Final Order of the Bankruptcy Court, and   (d) any Unimpaired Claims unless and until holders of Unimpaired Claims have   received payment on account of such Claims that render such claims Unimpaired   in accordance with the Plan. (d) Notwithstanding any language to the contrary   contained in this Disclosure Statement, Plan, and/or the Confirmation Order,   no provision of the Plan or the Confirmation Order shall (i) preclude the SEC   from enforcing its police or regulatory powers; or (ii) enjoin, limit,   impair, or delay the SEC from commencing or continuing any claims, causes of   action, proceedings or investigations against any non-Debtor person or   non-Debtor entity in any forum. (e) As to any Governmental Unit (as defined   in section 101(27) of the Bankruptcy Code), nothing in the Plan, Plan   Documents, or Confirmation Order shall limit or expand the scope of   discharge, release or injunction to which the Debtors or Reorganized Debtors   are entitled under the Bankruptcy Code, if any. The discharge, release, and   injunction provisions contained in the Plan, Plan Documents, or Confirmation   Order are not intended and shall not be construed to bar any Governmental   Unit from, subsequent to the Confirmation Order, pursuing any police or   regulatory action. Accordingly, notwithstanding anything contained in the   Plan, Plan Documents, or Confirmation Order to the contrary, nothing in the   Plan or Confirmation Order shall discharge, release, impair or otherwise   preclude: (1) any liability to any Governmental Unit that is not a “claim”   within the meaning of section 101(5) of the Bankruptcy Code; (2) any Claim of   any Governmental Unit arising on or after the Confirmation Date; (3) any valid   right of setoff or recoupment of any Governmental Unit against any of the   Debtors; or (4) any liability of the Debtors or Reorganized Debtors under   police or regulatory statutes or regulations to any Governmental Unit as the   owner, lessor, lessee or operator of property that such entity owns, operates   or leases after the Confirmation Date. Nor shall anything in the Plan, Plan   Documents, or Confirmation Order: (i) enjoin or otherwise bar any   Governmental Unit from asserting or enforcing, outside the Bankruptcy Court,   any liability described in the preceding sentence; or (ii) divest any court,   commission, or tribunal of jurisdiction to determine whether any liabilities   asserted by any Governmental Unit are discharged or otherwise barred by the   Plan, Plan Documents, Confirmation Order, or the Bankruptcy Code. Moreover,   nothing in the Plan, Plan Documents, or Confirmation Order shall release or   exculpate any non-debtor, including any Released Parties and/or exculpated   parties, from any liability to any Governmental Unit, including but not   limited to any liabilities arising under the Internal Revenue Code, the   environmental laws, or the criminal laws against the 66 

    

 

Released   Parties and/or exculpated parties, nor shall anything in the Plan, Plan   Documents, or Confirmation Order enjoin any Governmental Unit from bringing   any claim, suit, action or other proceeding against any non-Debtor for any   liability whatsoever; provided, however, that the foregoing sentence shall   not limit the scope of discharge granted to the Debtors under sections 524   and 1141 of the Bankruptcy Code. Nothing contained in the Plan, Plan   Documents, or Confirmation Order shall be deemed to determine the tax   liability of any person or entity, including but not limited to the Debtors   and the Reorganized Debtors, nor shall the Plan, Plan Documents, or   Confirmation Order be deemed to have determined the federal and/or state tax   treatment of any item, distribution, or entity, including the federal and/or   state tax consequences of the Plan and/or Plan Documents, nor shall anything   in the Plan, Plan Documents, or Confirmation Order be deemed to have   conferred jurisdiction upon the Bankruptcy Court to make determinations as to   federal and/or state tax liability and federal and/or state tax treatment   except as provided under 11 U.S.C. § 505. Article X of the Plan regarding   Executory Contracts and Unexpired Leases, and Section 7.8 of the Plan   regarding Cancellation of Existing Securities and Agreements, shall not apply   to the Government Settlement Agreements. The Government Settlement Agreements   shall be unimpaired by the Plan, Plan Documents, and Confirmation Order, and   shall remain obligations of the Debtors and/or the Reorganized Debtors, and   all rights, obligations, and duties under the Government Settlement   Agreements shall be preserved as if the Debtors’ bankruptcy cases were never   filed. All Governmental Units reserve all rights with respect to the   Government Settlement Agreements, and nothing contained in the Plan, Plan   Documents, or Confirmation Order shall discharge, release, impair, or   otherwise preclude any liability to any Governmental Unit arising from or   relating to the Government Settlement Agreements. Any amounts owed to   Governmental Units under the Government Settlement Agreements shall be paid   in full when due in the ordinary course and nothing in the Plan, Plan   Documents, or Confirmation Order shall be interpreted to set cure amounts,   authorize the assignment or rejection of any Government Settlement Agreement,   or require any Governmental Unit to approve of and consent to the assignment   of any Government Settlement Agreement. The Debtors and Reorganized Debtors   expressly agree that any provisions regarding default in the Government   Settlement Agreements shall continue to apply as set forth in those   agreements, irrespective of any provisions of the Plan, Plan Documents, and   Confirmation Order. For the avoidance of doubt, nothing contained in the   Plan, Plan Documents, or Confirmation Order shall divest any court, commission,   or tribunal of jurisdiction over any matters related to the Government   Settlement Agreements, or confer on the Bankruptcy Court jurisdiction over   any matter related to the Government Settlement Agreements. Notwithstanding   anything to the contrary in this paragraph, the provisions of this paragraph   are subject to the provisions of Section 5.5 of the Plan regarding   acceleration or increase of the monetary obligations under the Government   Settlement Agreements. The governmental units that are parties to the Government   Settlement Agreements have not at this time sought to accelerate or increase   payments under those agreements as a result of the filing of these Chapter 11   Cases or the consummation of the transactions contemplated by the Plan and   the Plan Documents. The Debtors and certain of the governmental units that   are parties to the Government Settlement Agreements are in 67 

    

 

discussions   regarding the intentions of those parties regarding acceleration of the   Debtors’ payment obligations under the Government Settlement Agreements. The   Debtors and these parties to the Government Settlement Agreements anticipate   reaching resolution on this issue before the Plan is confirmed. 6.15.   Exculpation and Limitation of Liability. To the extent permissible under   section 1125(e) of the Bankruptcy Code, on the Effective Date, for good and   valuable consideration, to the maximum extent permissible under applicable   law, including the New York Rules of Professional Conduct, none of the   Released Parties shall have or incur any liability to any holder of any Claim   or Interest or any other Person for any act or omission in connection with,   or arising out of the negotiation, implementation and execution of the Plan,   the Chapter 11 Cases, the RSA, the Plan Funding Agreement, the Disclosure   Statement, the DIP Financing Agreement, the solicitation of votes for and the   pursuit of confirmation of the Plan, the consummation of the Plan, or the   administration of the Plan or the property to be distributed under the Plan,   including all documents ancillary thereto, all decisions, actions, inactions   and alleged negligence or misconduct relating thereto and all activities   leading to the promulgation and confirmation of the Plan except for gross   negligence or willful misconduct, each as determined by a Final Order of the   Bankruptcy Court. For purposes of the foregoing, it is expressly understood   that any act or omission effected with the approval of the Bankruptcy Court   conclusively will be deemed not to constitute gross negligence, or willful   misconduct unless the approval of the Bankruptcy Court was obtained by fraud   or misrepresentation, and in all respects, the applicable Persons shall be   entitled to rely on the written advice of counsel with respect to their   duties and responsibilities under, or in connection with, the Chapter 11   Cases, the Plan, and the administration thereof. Notwithstanding anything to   the contrary herein, nothing in the Plan shall limit the liability of   attorneys to their respective clients pursuant to Rule 1.8(h) of the New York   Rules of Professional Conduct. 6.16. Injunction Related to Releases and   Exculpation. The Confirmation Order shall permanently enjoin the commencement   or prosecution by any Person, whether directly, derivatively or otherwise, of   any claims, obligations, suits, judgments, damages, demands, debts, rights,   Causes of Action or liabilities released pursuant to the Plan, including the   claims, obligations, suits, judgments, damages, demands, debts, rights,   Causes of Action or liabilities released in or encompassed by Sections 12.6   and 12.7 of the Plan. Each of the Reorganized Debtors, as applicable, is   expressly authorized hereby to seek to enforce such injunction. 6.17.   Retention of Causes of Action/Reservation of Rights. Subject to Sections   12.6, 12.7 and 12.8 of the Plan and except as expressly set forth in the   Plan, nothing contained in the Plan or the Confirmation Order shall be deemed   to be a waiver or relinquishment of any rights, claims or Causes of Action,   rights of setoff, or other legal or equitable defenses that the Debtors had   immediately prior to the Effective Date on behalf of the Estates or of   themselves in accordance with any provision of the Bankruptcy Code or any   applicable non-bankruptcy law. Subject to Sections 12.6, 12.7 and 12.8 of the   Plan and except as 68 

    

 

expressly set   forth in the Plan, the Reorganized Debtors shall have, retain, reserve, and   be entitled to assert all such claims, Causes of Action, rights of setoff, or   other legal or equitable defenses as fully as if the Chapter 11 Cases had not   been commenced, and all of the Debtors’ legal and/or equitable rights   respecting any Claim left unimpaired, as set forth in Articles IV and V of   the Plan, may be asserted after the Confirmation Date to the same extent as   if the Chapter 11 Cases had not been commenced. 6.18. Indemnification   Obligations. Notwithstanding anything to the contrary contained in the Plan,   including Section 10.1 of the Plan, subject to the occurrence of the   Effective Date, the existing obligations of the Debtors to indemnify, defend,   reimburse, exculpate, advance fees and expenses to, or limit the liability of   directors, officers or employees as of the Petition Date who were directors,   officers or employees of any of the Debtors or any of the Debtors’ non-Debtor   subsidiaries, solely in their capacity as such, at any time after the   Petition Date (whether or not also an officer, director or employee of   Novelion), against any Causes of Action, remain unaffected thereby after the   Effective Date and are not discharged. On and after the Effective Date, none   of the Reorganized Debtors shall terminate or otherwise reduce the coverage   under any directors’ and officers’ insurance policies in effect on the   Petition Date, and all directors and officers of the Debtors, regardless of   whether such person was a director or officer of the Debtors as of the   Petition Date shall be entitled to the full benefits of any such policy (to   the extent such director or officer is entitled to any benefits thereunder)   for the full term of such policy, but solely to the extent, and as provided   in, each such policy regardless of whether such directors and/or officers   remain in such positions after the Effective Date. For the avoidance of   doubt, all obligations of the Debtors to indemnify, defend, reimburse,   exculpate, advance fees and expenses to, or limit the liability of former   directors, officers or employees who were not directors, officers or   employees of any of the Debtors or any of the Debtors’ non-Debtor subsidiaries   at any time after the Petition Date, against any Causes of Action, are   classified as Other General Unsecured Claims and shall be discharged on the   Effective Date. ARTICLE VII. CONFIRMATION OF THE PLAN OF REORGANIZATION 7.1.   Confirmation Hearing. Section 1128(a) of the Bankruptcy Code requires the   bankruptcy court, after appropriate notice, to hold a hearing on confirmation   of a chapter 11 plan. The Bankruptcy Court will hold the Confirmation Hearing   with respect to the Plan on [September 5], 2019 at [ ] [ ].m. (prevailing   Eastern time). The hearing may be adjourned or continued from time to time by   the Debtors or the Bankruptcy Court without further notice except for an   announcement of the adjourned or continued date made at the Confirmation   Hearing (or an appropriate filing with the Bankruptcy Court) or any   subsequent adjourned or continued Confirmation Hearing. Section 1128(b) of   the Bankruptcy Code provides that any party in interest may object to   confirmation of a chapter 11 plan of reorganization. Any objection to   confirmation of the Plan must be in writing, must conform to the Bankruptcy   Rules, must set forth the name of 69 

    

 

the objector,   the nature and amount of Claims or Interests held or asserted by the objector   against the particular Debtor or Debtors, the basis for the objection and the   specific grounds therefor, and must be filed with the Clerk of the Bankruptcy   Court electronically using the Bankruptcy Court’s Case Management/Electronic   Case File (“CM/ECF”) System at https://ecf.nysb.uscourts.gov (a CM/ECF   password will be required),28 and by mailing a hard copy of such objection to   the chambers of the Honorable Martin Glenn, United States Bankruptcy Judge   for the Southern District of New York, United States Bankruptcy Court, 1   Bowling Green, New York, New York 10004, together with proof of service, and   served upon: (i) Aegerion Pharmaceuticals, Inc., 245 First Street, Riverview   II, 18th Floor, Cambridge, MA 02142 (Attn: John R. Castellano); (ii) counsel   to the Debtors, Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New   York, NY 10019 (Attn: Paul V. Shalhoub, Esq. and Andrew S. Mordkoff, Esq.);   (iii) counsel to those certain lenders under the Debtors’   debtor-in-possession financing facility, the Debtors’ prepetition secured   bridge loan credit agreement and the Debtors’ 2% unsecured convertible notes,   Latham & Watkins LLP, 330 North Wabash Avenue, Suite 2800, Chicago, IL   60611 (Attn: Richard A. Levy, Esq.) and King & Spalding LLP, 444 West   Lake Street, Suite 1650, Chicago, IL 60606 (Attn: Matthew L. Warren, Esq.);   (iv) proposed counsel to the Official Committee of Unsecured Creditors   appointed in these cases, Kramer Levin Naftalis & Frankel LLP, 1177   Avenue of the Americas, New York, NY 10036 (Attn: Kenneth H. Eckstein, Esq.   and Rachael Ringer, Esq.); (v) counsel to the U.S. Trustee for Region 2, 201   Varick Street, Suite 1006, New York, NY 10014 (Attn: Benjamin J. Higgins,   Esq. and Brian S. Masumoto, Esq.); (vi) counsel to Novelion Therapeutics   Inc., Goodwin Procter LLP, The New York Times Building, 620 Eighth Avenue,   New York, NY 10018 (Attn: Gregory Fox, Esq. and Jacqueline Mercier, Esq.);   and (vii) counsel to Amryt Pharma Plc, Gibson, Dunn & Crutcher LLP, 200   Park Avenue, New York, NY 10166 (Attn: Matthew J. Williams, Esq. and Jason   Zachary Goldstein, Esq.). UNLESS AN OBJECTION TO CONFIRMATION IS TIMELY   SERVED AND FILED, IT MAY NOT BE CONSIDERED BY THE BANKRUPTCY COURT. Prior to   the Disclosure Statement Hearing, two former officers of the Debtors filed   pleadings with the Bankruptcy Court reserving their rights to object to the   Plan at the Confirmation Hearing and/or raising premature Plan objections.   Specifically, Craig Fraser, the former chief operating officer of Aegerion,   filed a reservation of rights with respect to the Disclosure Statement and   Plan [Docket No. 157], which did not identify how or why the Disclosure   Statement failed to contain adequate information. In addition, Marc Beer, the   former chief executive officer of Aegerion, filed an objection [Docket No. 160]   (the “Beer Objection”) identifying certain alleged infirmities in the   Disclosure Statement (most of which, in the Debtors’ view, are disguised   confirmation objections). With respect to Mr. Beer’s objection that the   Disclosure Statement does not include estimated recoveries for holders of   Class 6B Other General Unsecured Claims (see Beer Objection at ¶ 13), Section   2.2 of the Disclosure Statement now sets forth that the estimated recoveries   for holders of Allowed Other General Unsecured Claims is approximately 80.7%.   28 A CM/ECF password may be obtained via the Bankruptcy Court’s CM/ECF   website at https://ecf.nysb.uscourts.gov. 70 

    

 

The Debtors   believe the balance of the Beer Objection (that the Disclosure Statement   lacks adequate information regarding the Debtors’ basis for (i) separately   classifying Ongoing Trade Claims from Other General Unsecured Claims (see   Beer Objection at ¶ 11), (ii) discharging prepetition indemnification   obligations owed to former directors and officers (see Beer Objection at ¶   12), and (iii) separately treating Claims held by current and former   directors and officers (see Beer Objection at ¶ 12)) raises potential   objections to confirmation of the Plan that the Debtors believe are more   appropriately addressed by the Bankruptcy Court in connection with   confirmation of the Plan. Plan confirmation issues only give rise to valid   disclosure statement objections if the relevant plan is inherently flawed and   clearly facially unconfirmable; that is, solicitation would be a “clearly   fruitless venture.” In re Valrico Square Ltd. P’ship, 113 B.R. 794, 796   (Bankr. S.D. Fla. 1990); see also In re 266 Washington Assocs., 141 B.R. 275,   288 (Bankr. E.D.N.Y. 1992) (disclosure statement not approved where plan has   patent legal defects and is not confirmable). This is not the case here, as   recognized by Mr. Beer himself. See Beer Objection at ¶ 3 (noting that the   intent of his objection is “not to argue that this Plan is ‘patently   unconfirmable’ or that the DS Approval Motion must be denied outright”) and   at ¶ 11 (“Mr. Beer appreciates that an objection to the separate   classification of Class 6A Ongoing Trade Claims and Class 6B Other General   Unsecured Claims is properly presented at the Confirmation Hearing...”).   Although the Debtors believe the objections raised by Mr. Beer are issues   more appropriately addressed at Plan confirmation, the following contains   additional disclosure regarding the potential Plan confirmation objections   raised in the Beer Objection. First, Mr. Beer suggests that the Debtors   impermissibly classified or unfairly discriminated against Class 6B Other   General Unsecured Claims vis-à-vis Class 6A Ongoing Trade Claims. As an   initial matter, courts have repeatedly stated that “[a] debtor in bankruptcy   has considerable discretion to classify claims and interests in a chapter 11   reorganization plan.” In re Wabash Valley Power Ass’n, 72 F.3d 1305, 1321   (7th Cir. 1996); accord Aetna Cas. & Sur. Co. v. Clerk, U.S. Bankr. Ct.   (In re Chateaugay Corp.), 89 F.3d 942, 949-50 (2d Cir. 1996). In addition,   courts have confirmed plans that separately classified and treated trade   creditors and other general unsecured creditors where, as is the case here,   trade creditors are vital to the debtors’ ongoing, post-emergence business.   See, e.g., In re Nuverra Environmental Solutions, Inc., 2017 WL 3326453 (D.   Del. Aug. 3, 2017) (in confirming plan that separately classified trade   creditors from holders of unsecured notes, court rejected classification and   unfair discrimination objections on the basis that trade creditors were   critical to the success of the reorganized debtors); In re Journal Register   Co., 407 B.R. 520, 532 at n.6 (Bankr. S.D.N.Y. 2009) (noting in dicta that   any alleged unfair discrimination under the plan was reasonable in light of   the substantial evidence submitted as to why trade creditors (whose good will   was essential to postconfirmration success of the debtors’ business) were   favored over other unsecured creditors). Here, the Debtors and their foreign   non-Debtor subsidiaries rely on third parties to carry out critical aspects   of their business, including commercialization, manufacturing, supply chain,   clinical development, distribution, drug safety reporting and compliance,   REMS and risk management programs, compliance, and other key areas. The   importance of the Debtors’ ongoing trade creditors, coupled with the limited   size of trade claims, justifies the Debtors’ decision to pay in full in Cash   their trade creditors that will continue to provide goods and services to the   Debtors after their emergence from these Chapter 11 Cases. 71 

    

 

Second, Mr.   Beer objects to the Debtors’ decision to discharge their prepetition   obligations to indemnify and advance legal costs to former directors and   officers. Given the financial burden imposed by such obligations, coupled   with the alleged improprieties of some of the Debtors’ former directors and   officers, the Debtors elected to reject such commitments going forward. See   Plan at § 12.10. Mr. Beer complains that the Debtors did not include in the   Disclosure Statement a basis for discharging the Debtors’ indemnification   obligations. The Debtors believe the proposed discharge is a customary   provision in chapter 11 plans and is permitted under section 1141(d)(1)(A) of   the Bankruptcy Code (which provides that except as otherwise provided in the   plan or confirmation order, confirmation of a plan “discharges the debtor from   any debt that arose before the date of such confirmation”). The Debtors’   business judgment in this regard is only reinforced (and not diminished, as   Mr. Beer suggests) by their decision to assume indemnification obligations   with respect to current directors and officers. See Plan at § 12.10. Unlike   their former directors and officers, the Debtors’ current directors and   officers are important members of the Debtors’ ongoing business and have been   (and continue to be) instrumental to the success of the Debtors’ plan   negotiation process. The Debtors reserve all rights to respond to any   objections to confirmation of the Plan raised by Mr. Fraser and Mr. Beer,   including on the foregoing grounds and on any other grounds available under   the Bankruptcy Code, applicable case law or otherwise. Mr. Beer disputes that   the Indemnity Agreement (as defined in the Beer Objection) or the Debtors’   obligations under the Debtors’ bylaws can be rejected or that the obligations   thereunder can be discharged. 7.2. Confirmation. At the Confirmation Hearing,   the Bankruptcy Court will determine whether the requirements of section   1129(a) of the Bankruptcy Code have been satisfied with respect to the Plan.   (a) Confirmation Requirements. Confirmation of a chapter 11 plan under   section 1129(a) of the Bankruptcy Code requires, among other things, that: i.   the plan complies with the applicable provisions of the Bankruptcy Code; ii.   the proponent of the plan has complied with the applicable provisions of the   Bankruptcy Code; iii. the plan has been proposed in good faith and not by any   means forbidden by law; iv. any plan payment made or to be made by the   proponent under the plan for services or for costs and expenses in, or in   connection with, the chapter 11 case, or in connection with the plan and   incident to the case, has been approved by, or is subject to the approval of,   the Bankruptcy Court as reasonable; v. the proponent has disclosed the   identity and affiliations of any individual proposed to serve, after   confirmation of the plan, as a director, officer, or voting 72 

    

 

trustee of the   debtor, an affiliate of the debtor participating in the plan with the debtor,   or a successor to the debtor under the plan. The appointment to, or   continuance in, such office by such individual must be consistent with the   interests of creditors and equity security holders and with public policy and   the proponent must have disclosed the identity of any insider that the   reorganized debtor will employ or retain, and the nature of any compensation   for such insider; vi. with respect to each impaired class of claims or   interests, either each holder of a claim or interest of such class has   accepted the plan, or will receive or retain under the plan, on account of   such claim or interest, property of a value, as of the effective date of the   plan, that is not less than the amount that such holder would receive or   retain if the debtor were liquidated on such date under chapter 7 of the   Bankruptcy Code; vii. subject to the “cramdown” provisions of section 1129(b)   of the Bankruptcy Code, each class of claims or interests has either accepted   the plan or is not impaired under the plan; viii. except to the extent that   the holder of a particular claim has agreed to a different treatment of such   claim, the plan provides that allowed administrative expenses and priority   claims will be paid in full on the effective date (except that holders of   priority tax claims may receive deferred cash payments of a value, as of the   effective date of the plan, equal to the allowed amounts of such claims and   that holders of priority tax claims may receive on account of such claims   deferred cash payments, over a period not exceeding 5 years after the date of   assessment of such claims, of a value, as of the effective date, equal to the   allowed amount of such claims); ix. if a class of claims is impaired, at   least one (1) impaired class of claims has accepted the plan, determined   without including any acceptance of the plan by any insider holding a claim   in such class; and x. confirmation of the plan is not likely to be followed   by the liquidation, or the need for further financial reorganization, of the   debtor or any successor to the debtor under the plan, unless such liquidation   or reorganization is proposed in the plan. The Debtors believe that: i. the   Plan satisfies all of the statutory requirements of chapter 11 of the   Bankruptcy Code; ii. the Debtors, as the proponents of the Plan, have   complied or will have complied with all of the requirements of chapter 11 of   the Bankruptcy Code; and iii. the Plan has been proposed in good faith. Set   forth below is a summary of certain relevant statutory confirmation   requirements. 73 

    

 

(i) Acceptance.   Claims in Classes 3, 4 and 6B are impaired under the Plan and are entitled to   vote to accept or reject the Plan. Claims in Classes 1, 2, 5 and 6A are   unimpaired and, therefore, are conclusively presumed to have voted to accept   the Plan pursuant to section 1126(f) of the Bankruptcy Code. Claims and   Interests in Classes 7 and 8 are impaired and not receiving any property   under the Plan, and thus are deemed to have rejected the Plan. Because   certain Classes are deemed to have rejected the Plan, the Debtors will   request confirmation of the Plan under section 1129(b) of the Bankruptcy   Code. The Debtors reserve the right to alter, amend, modify, revoke or   withdraw the Plan, any exhibit, or schedule thereto or any Plan Document,   with the consent of the Required Parties, in order to satisfy the   requirements of section 1129(b) of the Bankruptcy Code, if necessary. The   Debtors believe that the Plan satisfies the “cramdown” requirements of   section 1129(b) of the Bankruptcy Code with respect to Claims and Interests   in Classes 7 and 8 because (a) no holders of a Claim in a senior Class will receive   more than a 100% recovery on account of its Claim, and (b) no holder of a   Claim or Interest in a junior Class with a lower priority will receive any   recovery under the Plan. The Debtors also will seek confirmation of the Plan   over the objection of any individual holders of Claims who are members of an   accepting Class. There can be no assurance, however, that the Bankruptcy   Court will determine that the Plan meets the requirements of section 1129(b)   of the Bankruptcy Code. (ii) Unfair Discrimination and Fair and Equitable   Test. To obtain nonconsensual confirmation of the Plan, it must be   demonstrated to the Bankruptcy Court that the Plan “does not discriminate   unfairly” and is “fair and equitable” with respect to each impaired,   non-accepting Class. The Bankruptcy Code provides a non-exclusive definition   of the phrase “fair and equitable” for, respectively, secured creditors,   unsecured creditors and holders of equity interests. In general, section   1129(b) of the Bankruptcy Code permits confirmation notwithstanding   non-acceptance by an impaired class if that class and all junior classes are   treated in accordance with the “absolute priority” rule, which requires that   the dissenting class be paid in full before a junior class may receive   anything under the plan. A chapter 11 plan does not “discriminate unfairly”   with respect to a non-accepting class if the value of the cash and/or   securities to be distributed to the non-accepting class is equal to, or   otherwise fair when compared to, the value of the distributions to other   classes whose legal rights are the same as those of the non-accepting class.   The Debtors believe the Plan will not discriminate unfairly against any   non-accepting Class. (iii) Feasibility; Financial Projections. The Bankruptcy   Code permits a plan to be confirmed only if confirmation is not likely to be   followed by liquidation or the need for further financial reorganization of   the Debtors or any successor to the Debtors, unless such liquidation or   reorganization is proposed in the Plan. For purposes of determining whether   the Plan meets this requirement, the Debtors have analyzed the ability of the   Plan Investor and the Reorganized Debtors to meet their obligations under the   Plan and retain sufficient liquidity and capital resources to conduct their   business. Under the 74 

    

 

terms of the   Plan, the Allowed Claims potentially being paid in whole or in part in Cash   are the DIP Claims, Allowed Administrative Expense Claims, Allowed Fee   Claims, Allowed Priority Tax Claims, U.S. Trustee Fees, Allowed Priority   Non-Tax Claims, Allowed Other Secured Claims, and Allowed Ongoing Trade   Claims. The Debtors expect sufficient liquidity from Cash on hand, the Rights   Offering and post-Effective Date operations to fund these Cash payments as   and when they become due. In connection with developing the Plan, the Debtors   have prepared detailed financial projections (the “Financial Projections”),   attached as Exhibit 3 hereto, which detail, among other things, the financial   feasibility of the Plan. The Financial Projections indicate, on a pro forma basis,   that the projected level of Cash flow is sufficient to satisfy all of the   Reorganized Debtors’ future debt and debt related interest cost, research and   development, capital expenditure and other obligations during this period.   Accordingly, the Debtors believe that confirmation of the Plan is not likely   to be followed by the liquidation or further reorganization of the   Reorganized Debtors. THE FINANCIAL PROJECTIONS, INCLUDING THE UNDERLYING   ASSUMPTIONS, SHOULD BE CAREFULLY REVIEWED IN EVALUATING THE PLAN. WHILE   MANAGEMENT BELIEVES THE ASSUMPTIONS UNDERLYING THE FINANCIAL PROJECTIONS,   WHEN CONSIDERED ON AN OVERALL BASIS, WERE REASONABLE WHEN PREPARED IN LIGHT   OF CURRENT CIRCUMSTANCES AND EXPECTATIONS, NO ASSURANCE CAN BE GIVEN THAT THE   FINANCIAL PROJECTIONS WILL BE REALIZED. THE DEBTORS MAKE NO REPRESENTATION OR   WARRANTY AS TO THE ACCURACY OF THE FINANCIAL PROJECTIONS. THE PROJECTIONS ARE   SUBJECT TO A NUMBER OF RISKS, UNCERTAINTIES AND ASSUMPTIONS, INCLUDING THOSE   DESCRIBED BELOW UNDER ARTICLE XI. IN LIGHT OF THESE RISKS AND UNCERTAINTIES,   ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED IN THE   FINANCIAL PROJECTIONS. The Debtors prepared the Financial Projections based   upon certain assumptions that they believe to be reasonable under the circumstances.   The Financial Projections have not been examined or compiled by independent   accountants. Moreover, such information is not prepared in accordance with   accounting principles generally accepted in the United States (“GAAP”). The   Debtors make no representation as to the accuracy of the Financial   Projections or their ability to achieve the projected results. Many of the   assumptions on which the Financial Projections are based are inherently   subject to significant economic and competitive uncertainties and   contingencies beyond the control of the Debtors and their management.   Inevitably, some assumptions will not materialize and unanticipated events   and circumstances may affect the actual financial results. Therefore, the   actual results achieved may vary from the projected results and the   variations may be material. All holders of Claims that are entitled to vote   to accept or reject the Plan are urged to examine carefully all of the   assumptions on which the Financial Projections are based in connection with   their evaluation of the Plan. (b)Best Interests Test. The “best interests”   test requires that the Bankruptcy Court find either: 75 

    

 

that all   members of each impaired class have accepted the plan; or • • that each   holder of an allowed claim or interest in each impaired class of claims or   interests will receive or retain under the plan on account of such claim or   interest, property of a value, as of the effective date of the plan, that is   not less than the amount such holder would receive or retain if the debtor   were liquidated under chapter 7 of the Bankruptcy Code on such date. To   determine what the holders of Claims and Interests in each impaired Class   would receive if the Debtors were liquidated under chapter 7 on the Effective   Date, the Bankruptcy Court must determine the dollar amount that would have   been generated from the liquidation of the Debtors’ assets and properties in   a liquidation under chapter 7 of the Bankruptcy Code. The Cash that would be   available for satisfaction of Claims and Interests would consist of the   proceeds from the disposition of the assets and properties of the Debtors,   augmented by the Cash held by the Debtors. Such Cash amount would be: (i)   first, reduced by the amount of the Allowed DIP Claims and the secured   portion of the Allowed Other Secured Claims, Allowed Bridge Loan Claims, and   Allowed Novelion Intercompany Loan Claims; (ii) second, reduced by the costs   and expenses of liquidation under chapter 7 (including the fees payable to a   chapter 7 trustee and the fees payable to professionals that such trustee   might engage) and such additional administrative claims that might result   from the termination of the Debtors’ business; and (iii) third, reduced by   the amount of the Allowed Administrative Expense Claims, U.S. Trustee Fees,   Allowed Priority Tax Claims, and Allowed Priority Non-Tax Claims. Any   remaining net Cash would be allocated to creditors and stakeholders in strict   order of priority pursuant to section 726 of the Bankruptcy Code. Additional   claims would arise by reason of the breach or rejection of obligations under   unexpired leases and executory contracts. To determine if the Plan is in the   best interests of each impaired Class, the present value of the distributions   from the proceeds of a liquidation of the Debtors’ assets and properties,   after subtracting the amounts discussed above, must be compared with the   value of the property offered to each such Class of Claims under the Plan.   After considering the effects that a chapter 7 liquidation would have on the   ultimate proceeds available for distribution to creditors in the Chapter 11   Cases, the Debtors have determined that confirmation of the Plan will provide   each holder of an Allowed Claim with a recovery that is not less than such   holder would have received pursuant to the liquidation of the Debtors under   chapter 7. Moreover, the Debtors believe that the value of distributions to   each Class of Allowed Claims in a chapter 7 case would be materially less   than the value of distributions under the Plan and any distribution in a   chapter 7 case would not occur for a substantial period of time. It is likely   that a liquidation of the Debtors’ assets could take more than a year to   complete, and distribution of the proceeds of the liquidation could be delayed   for up to six months after the completion of such liquidation to resolve   claims and prepare for distributions. In the likely event 76 

    

 

litigation was   necessary to resolve claims asserted in the chapter 7 case, the delay could   be prolonged. The Debtors, with the assistance of their advisors, have   prepared a liquidation analysis that summarizes the Debtors’ best estimate of   recoveries by creditors and equity interest holders in the event of   liquidation as of September 30, 2019 (the “Liquidation Analysis”), a copy of   which is attached hereto as Exhibit 2. The Liquidation Analysis provides: (a)   a summary of the liquidation values of the Debtors’ assets, assuming a   chapter 7 liquidation in which a trustee appointed by the Bankruptcy Court would   liquidate the assets of the Debtors’ estates, and (b) the expected recoveries   of the Debtors’ creditors and equity interest holders under the Plan. The   Liquidation Analysis contains a number of estimates and assumptions that,   although developed and considered reasonable by the Debtors’ management and   their advisors, are inherently subject to significant economic and   competitive uncertainties and contingencies beyond the control of the Debtors   and their management and their advisors. The Liquidation Analysis also is   based on assumptions with regard to liquidation decisions that are subject to   change and significant economic and competitive uncertainties and   contingencies beyond the control of the Debtors and their management and   their advisors. Accordingly, the values reflected might not be realized. The   chapter 7 liquidation period is assumed to last 7 to 11 months following the   appointment of a chapter 7 trustee, allowing for, among other things, the   discontinuation and wind-down of operations, the sale of the operations as   going concerns or as individual assets, the collection of receivables and the   finalization of tax affairs. All holders of Claims that are entitled to vote   to accept or reject the Plan are urged to examine carefully all of the assumptions   on which the Liquidation Analysis is based in connection with their   evaluation of the Plan. 7.3. Standards Applicable to Releases. Article XII of   the Plan provides for releases for certain claims against non-Debtors in   consideration of services provided to the Debtors and the contributions made   by the Released Parties to the Debtors’ chapter 11 cases. The Released   Parties are: (a) the Debtors, their respective non-Debtor subsidiaries, and   the Reorganized Debtors; (b) Novelion; (c) the DIP Administrative Agent and   the DIP Lenders; (d) the Bridge Loan Administrative Agent; (e) the   Convertible Notes Trustee; (f) the Bridge Loan Lenders; (g) the Consenting   Lenders; (h) the members of the Ad Hoc Group; (i) the Plan Investor; (j) the   Committee and each of its current and former members solely in their capacity   as members of the Committee; (k) each of such parties’ respective   predecessors, successors, assigns, subsidiaries, owners, affiliates, managed   accounts, funds or funds under common management; and (l) each of the   foregoing parties’ (described in clauses (a)-(k)) respective current and   former officers, directors, managers, managing members, employees, members,   principals, shareholders, agents, advisory board members, management   companies, fund advisors, partners, attorneys, financial advisors or other   professionals or representatives, together with their successors and assigns,   in each case solely in their capacity as such; provided, however, that former   directors, officers and employees of the Debtors shall not be deemed Released   Parties; provided further that such attorneys and professional advisors shall   only include those that provided services related to the Chapter 11 Cases and   the transactions contemplated by the Plan (and do not include the attorneys   and law 77 

    

 

firms retained   by the Debtors in the ordinary course of business during these Chapter 11   Cases); provided, further, that no Person shall be a Released Party if it   objects to the releases provided for in Article XII of the Plan. As set forth   in the Plan, the releases are given by: (a) the Debtors, their respective   non-Debtor subsidiaries, and the Reorganized Debtors; (b) Novelion; (c) the   DIP Administrative Agent and the DIP Lenders; (d) the Bridge Loan   Administrative Agent; (e) the Convertible Notes Trustee; (f) the Bridge Loan   Lenders; (g) the Consenting Lenders; (h) the members of the Ad Hoc Group; (i)   the Plan Investor; (j) the Committee and each of its members solely in their   capacity as members of the Committee; (k) each of such parties’ respective   predecessors, successors, assigns, subsidiaries, owners, affiliates, managed   accounts, funds or funds under common management; (l) each of the foregoing   parties’ (described in clauses (a)-(k)) respective current and former officers,   directors, managers, managing members, employees, members, principals,   shareholders, agents, advisory board members, management companies, fund   advisors, partners, attorneys, financial advisors or other professionals or   representatives, together with their successors and assigns, in each case   solely in their capacity as such; (m) holders of Claims who vote to accept   the Plan; (n) holders of Claims who vote to reject the Plan but who vote to   “opt in” to the Third Party Release; and (o) all holders of Claims and   Interests not described in clauses (a)-(n) who elect to opt-in to the Third   Party Release; provided, however, that notwithstanding anything to the   contrary in the Plan, the scope of the “Releasing Parties” shall be subject   to the limitations set forth in Section 12.06(b) of the Plan. The Debtors   believe that the releases set forth in the Plan are appropriate because,   among other things, the releases are narrowly tailored to the Debtors’   restructuring proceedings, and each of the Released Parties has provided —   and will continue to provide — value to the Debtors and aided in the   reorganization process, including, with respect to certain Released Parties,   by entry into the RSA and the Plan Funding Agreement, which facilitated the   Debtors’ ability to propose and pursue confirmation of the Plan. The Debtors   believe that each of the Released Parties has played an integral role during   the prepetition period leading up to the Debtors’ bankruptcy filing, and will   continue to do so in these chapter 11 cases and has expended significant time   and resources analyzing and negotiating the issues presented by the Debtors’   prepetition capital structure. The Debtors intend to establish at the   Confirmation Hearing that each of the non-Debtor Released Parties contributed   significantly to the Debtors’ reorganization process and satisfied the   standard applied in this district with respect to Debtor releases and   third-party releases. Further, the Debtors are not aware of any cognizable   claims of any material value against the Released Parties that the Debtors or   their estates would be releasing in connection with Section 12.6(a) of the   Plan. 7.4. Classification of Claims and Interests. The Debtors believe that   the Plan complies with the classification requirements of the Bankruptcy   Code, which require that a chapter 11 plan place each claim and interest into   a class with other claims or interests that are “substantially similar.” 78 

    

 

7.5.   Consummation. The Plan will be consummated on the Effective Date. The   Effective Date will occur on the first Business Day on which the conditions   precedent to the effectiveness of the Plan, as set forth in Section 11.1 of   the Plan, have been satisfied or waived pursuant to the Plan. The Plan is to   be implemented pursuant to its terms, consistent with the provisions of the   Bankruptcy Code. 7.6. Exemption from Certain Transfer Taxes. To the fullest   extent permitted by applicable law, all sale transactions consummated by the   Debtors and approved by the Bankruptcy Court on and after the Confirmation   Date through and including the Effective Date, including any transfers   effectuated under the Plan, the sale by the Debtors of any owned property   pursuant to section 363(b) of the Bankruptcy Code, and any assumption,   assignment, and/or sale by the Debtors of their interests in unexpired leases   of non-residential real property or executory contracts pursuant to section   365(a) of the Bankruptcy Code, shall constitute a “transfer under a plan”   within the purview of section 1146 of the Bankruptcy Code, and shall not be   subject to any stamp, real estate transfer, mortgage recording, or other   similar tax. 7.7. Retiree Benefits. On and after the Effective Date, pursuant   to section 1129(a)(13) of the Bankruptcy Code, the Reorganized Debtors shall   continue to pay all retiree benefits (within the meaning of, and subject to   the limitations of, section 1114 of the Bankruptcy Code), if any, at the   level established in accordance with section 1114 of the Bankruptcy Code, at   any time prior to the Confirmation Date, for the duration of the period for   which any applicable Debtor had obligated itself to provide such benefits.   Nothing in the Plan shall: (a) restrict the Debtors’ or the applicable   Reorganized Debtors’ right to modify the terms and conditions of the retiree   benefits, if any, as otherwise permitted pursuant to the terms of the   applicable plans, non-bankruptcy law, or section 1114(m) of the Bankruptcy   Code; or (b) be construed as an admission that any such retiree benefits are   owed by the Debtors. 7.8. Dissolution of the Committee. The Committee shall   be automatically dissolved on the Effective Date and all members, employees   or agents thereof shall be released and discharged from all rights and duties   arising from, or related to, the Chapter 11 Cases, provided that the   Committee and its professionals shall have the right to file, prosecute,   review, and object to any applications for compensation and reimbursement of   expenses filed in accordance with Section 3.3 of the Plan. 7.9. Termination   of Professionals. On the Effective Date, the engagement of each Professional   Person retained by the Debtors and the Committee shall be terminated without   further order of the Bankruptcy Court or act of the parties; provided,   however, such Professional Persons shall be entitled to prosecute their   respective Fee Claims and represent their respective constituents with   respect to 79 

    

 

applications   for allowance and payment of such Fee Claims, and the Reorganized Debtors   shall be responsible for the reasonable and documented fees, costs and   expenses associated with the prosecution of such Fee Claims. Nothing in the   Plan shall preclude any Reorganized Debtor from engaging a former   Professional Person on and after the Effective Date in the same capacity as   such Professional Person was engaged prior to the Effective Date. 7.10.   Amendments. The Plan may be amended, modified, or supplemented by the   Debtors, subject to the parties’ rights under the RSA and the Plan Funding   Agreement, in the manner provided for by section 1127 of the Bankruptcy Code   or as otherwise permitted by law, without additional disclosure pursuant to   section 1125 of the Bankruptcy Code, except as otherwise ordered by the   Bankruptcy Court. In addition, after the Confirmation Date, so long as such   action does not adversely affect the Plan Investor or the treatment of   holders of Allowed Claims pursuant to the Plan, the Debtors may make   appropriate technical adjustments, remedy any defect or omission or reconcile   any inconsistencies in the Plan, the Plan Documents and/or the Confirmation   Order, with respect to such matters as may be necessary to carry out the   purposes and effects of the Plan, and any holder of a Claim that has accepted   the Plan shall be deemed to have accepted the Plan as amended, modified, or   supplemented. The Debtors may make technical adjustments and modifications to   the Plan without further order or approval of the Bankruptcy Court; provided,   however, that, such technical adjustments and modifications are immaterial or   do not adversely affect the Plan Investor or the treatment of holders of   Claims or Interests under the Plan. 7.11. Revocation or Withdrawal of the   Plan. Subject to the parties’ rights under the RSA and the Plan Funding   Agreement, the Debtors reserve the right to revoke or withdraw the Plan prior   to the Effective Date. If the Debtors revoke or withdraw the Plan, in   accordance with the preceding sentence, prior to the Effective Date as to any   or all of the Debtors, or if confirmation or consummation as to any or all of   the Debtors does not occur, then, with respect to such Debtors: (a) the Plan   shall be null and void in all respects; (b) any settlement or compromise   embodied in the Plan (including the fixing or limiting to an amount of any   Claim or Interest or Class of Claims or Interests), assumption or rejection   of executory contracts or leases affected by the Plan, and any document or   agreement executed pursuant to the Plan shall be deemed null and void,   provided, however, that the Plan Investor, or any of its designees, shall   retain its rights and to the extent provided under the Transaction Documents;   and (c) nothing contained in the Plan shall (i) constitute a waiver or   release of any Claims by or against, or any Interests in, such Debtors or any   other Person, (ii) prejudice in any manner the rights of such Debtors or any   other Person or (iii) constitute an admission of any sort by the Debtors or   any other Person. 7.12. Post-Confirmation Jurisdiction of the Bankruptcy   Court. Pursuant to sections 105 and 1142 of the Bankruptcy Code and   notwithstanding entry of the Confirmation Order and the occurrence of the   Effective Date, on and after the Effective Date, the Bankruptcy Court shall retain   exclusive jurisdiction, pursuant to 28 U.S.C. §§ 1334 and 157, over all   matters arising in, arising under, or related to the Chapter 11 Cases for,   among other things, the following purposes: 80 

    

 

(a) To hear and   determine applications for the assumption or rejection of executory contracts   or unexpired leases and the Cure Disputes resulting therefrom; (b) To   determine any motion, adversary proceeding, application, contested matter,   and other litigated matter pending on or commenced after the Confirmation   Date; (c) To hear and resolve any disputes arising from or relating to (i)   any orders of the Bankruptcy Court granting relief under Bankruptcy Rule   2004, or (ii) any protective orders entered by the Bankruptcy Court in   connection with the foregoing; (d) To ensure that Plan Distributions to   holders of Allowed Claims are accomplished as provided in the Plan; (e) To   consider Claims or the allowance, classification, priority, compromise,   estimation, or payment of any Claim, including any Administrative Expense   Claim; (f) To enter, implement, or enforce such orders as may be appropriate   in the event the Confirmation Order is for any reason stayed, reversed,   revoked, modified or vacated; (g) To issue and enforce injunctions, enter and   implement other orders, and take such other actions as may be necessary or   appropriate to restrain interference by any Person with the consummation,   implementation, or enforcement of the Plan, the Confirmation Order, or any   other order of the Bankruptcy Court; (h) To hear and determine any   application to modify the Plan in accordance with section 1127 of the   Bankruptcy Code, to remedy any defect or omission or reconcile any   inconsistency in the Plan, the Disclosure Statement, or any order of the   Bankruptcy Court, including the Confirmation Order, in such a manner as may   be necessary to carry out the purposes and effects thereof; (i) To hear and   determine all Fee Claims; (j) To hear and determine disputes arising in   connection with the interpretation, implementation, or enforcement of the   Plan, the Confirmation Order, any transactions or payments contemplated   hereby, or any agreement, instrument, or other document governing or relating   to any of the foregoing; (k) To take any action and issue such orders,   including any such action or orders as may be necessary after occurrence of   the Effective Date and/or consummation of the Plan, as may be necessary to   construe, enforce, implement, execute, and consummate the Plan, including any   release or injunction provisions set forth in the Plan, or to maintain the   integrity of the Plan following consummation; (l) To determine such other   matters and for such other purposes as may be provided in the Confirmation   Order; (m) To hear and determine all disputes involving the existence, nature   or scope of the discharge, releases and injunction provisions contained in   the Plan; 81 

    

 

(n) To hear and   determine matters concerning state, local and federal taxes in accordance   with sections 346, 505, and 1146 of the Bankruptcy Code; (o) To hear and   determine any other matters related hereto and not inconsistent with the   Bankruptcy Code and title 28 of the United States Code; (p) To resolve any   disputes concerning whether a Person had sufficient notice of the Chapter 11   Cases, the Disclosure Statement Hearing, the Confirmation Hearing, any   applicable Bar Date, or the deadline for responding or objecting to a Cure   Amount, for the purpose of determining whether a Claim or Interest is   discharged hereunder, or for any other purpose; (q) To recover all assets of   the Debtors and property of the Estates, wherever located; and (r) To enter a   final decree closing each of the Chapter 11 Cases. ARTICLE VIII. ALTERNATIVES   TO CONFIRMATION AND CONSUMMATION OF THE PLAN If the Plan is not consummated,   the Debtors’ capital structure will remain over-leveraged and the Debtors   will be unable to satisfy in full their debt obligations. Accordingly, if the   Plan is not confirmed and consummated, the alternatives include the   following: 8.1. Liquidation Under Chapter 7 of the Bankruptcy Code. The   Debtors could be liquidated under chapter 7 of the Bankruptcy Code. A   discussion of the effect a chapter 7 liquidation would have on the recoveries   of the holders of Claims is set forth in Article VII of this Disclosure   Statement. The Debtors believe that liquidation would result in lower   aggregate distributions being made to creditors than those provided for in   the Plan, which is demonstrated by the Liquidation Analysis set forth in   Article VII and attached as Exhibit 2 to this Disclosure Statement. 8.2.   Alternative Plan(s) of Reorganization. The Debtors believe that failure to   confirm the Plan will lead inevitably to expensive and protracted Chapter 11   Cases, whereas the Plan will enable the Debtors to emerge from chapter 11   successfully and expeditiously, preserving their business and allowing   creditors to realize the highest recoveries under the circumstances. In a   liquidation under chapter 11 of the Bankruptcy Code, the assets of the   Debtors would be sold in an orderly fashion over a more extended period of   time than in a liquidation under chapter 7, and a trustee need not be   appointed. Accordingly, creditors would receive greater recoveries than in a   chapter 7 liquidation. Although a chapter 11 liquidation may be preferable to   a chapter 7 liquidation, the Debtors believe that a liquidation under chapter   11 is a much less attractive alternative to holders of Claims and Interests   than the Plan because the Plan provides for a greater return to holders of   Claims and Interests. 82 

    

 

Moreover, the   prolonged continuation of the Chapter 11 Cases is likely to adversely affect   the Debtors’ business and operations. So long as these Chapter 11 Cases   continue, senior management of the Debtors will be required to spend a   significant amount of time and effort dealing with the Debtors’   reorganization instead of focusing exclusively on business operations.   Prolonged continuation of the Chapter 11 Cases will also make it more   difficult to attract and retain management and other key personnel necessary   to the success and growth of the Debtors’ business. In addition, the longer   these cases continue, the more likely it is that the Debtors’ customers,   suppliers, distributors, and agents will lose confidence in the Debtors’   ability to reorganize their business successfully and will seek to establish   alternative commercial relationships. Furthermore, so long as the Chapter 11   Cases continue, the Debtors will be required to incur substantial costs for   professional fees and other expenses associated with reorganizing. The   Debtors believe that not only does the Plan fairly adjust the rights of   various Classes of Claims, but also that the Plan provides superior   recoveries over any alternative capable of rational consideration (such as a   chapter 7 liquidation), thereby enabling stakeholders to maximize their   returns. Rejection of the Plan in favor of some alternative method of   reconciling the Claims and Interests will require, at the very least, an   extensive and time-consuming process (including the possibility of protracted   and costly litigation) and will not result in a better recovery for any Class   of Claims or Interests. THE DEBTORS BELIEVE THAT CONFIRMATION OF THE PLAN IS   PREFERABLE TO ANY ALTERNATIVE BECAUSE THE PLAN MAXIMIZES THE AMOUNT OF   DISTRIBUTIONS TO ALL HOLDERS OF CLAIMS AND ANY ALTERNATIVE TO CONFIRMATION OF   THE PLAN WILL RESULT IN SUBSTANTIAL DELAYS IN THE DISTRIBUTION OF ANY   RECOVERIES. THEREFORE, THE DEBTORS RECOMMEND THAT ALL HOLDERS OF IMPAIRED   CLAIMS ENTITLED TO VOTE ON THE PLAN VOTE TO ACCEPT THE PLAN. 8.3. Dismissal   of the Chapter 11 Cases. Dismissal of the Chapter 11 Cases would have the   effect of restoring (or attempting to restore) all parties to the status quo   ante. Upon dismissal of the Chapter 11 Cases, the Debtors would lose the   protection of the Bankruptcy Code, thereby requiring, at the very least, an   extensive and time consuming process of negotiations with their creditors,   possibly resulting in costly and protracted litigation in various   jurisdictions. Moreover, holders of the Debtors’ secured claims may be   permitted to foreclose upon the assets that are subject to their Liens, which   is likely all of the Debtors’ assets, including all of their Cash. Dismissal   may also permit certain unpaid unsecured creditors to obtain and enforce judgments   against the Debtors. The Debtors believe that these actions would seriously   undermine their ability to obtain financing and could lead ultimately to the   liquidation of the Debtors under chapter 7 of the Bankruptcy Code. Therefore,   the Debtors believe that dismissal of the Chapter 11 Cases is not a viable   alternative to the Plan. 83 

    

 

ARTICLE IX.   SUMMARY OF VOTING PROCEDURES This Disclosure Statement, including all   exhibits hereto and the related materials included herewith, once approved by   the Bankruptcy Court, will be furnished to the holders of Claims in Classes   3, 4 and 6B, which are the only Claims entitled to vote on the Plan. All   votes to accept or reject the Plan must be cast by using the Ballot(s)   enclosed with this Disclosure Statement (or, with respect to the beneficial   holders of Convertible Notes Claims (on account of their Class 6B Other   General Unsecured Claims) provided to such holders by their respective   Intermediaries). No other votes will be counted. Consistent with the   provisions of Bankruptcy Rule 3018, [July 11, 2019 at 5:00 p.m.] (prevailing   Eastern time) has been established as the Voting Record Date. Ballots must be   RECEIVED by the Voting Agent no later than the Voting Deadline, 4:00 p.m.   (prevailing Eastern time) on [August 15, 2019], unless the Debtors, at any   time, in their sole discretion, extend such date by oral or written notice to   the Voting Agent, in which event the period during which Ballots will be   accepted will terminate at 4:00 p.m. (prevailing Eastern time) on such   extended date. See Section 1.4 “Voting; Holders of Claims Entitled to Vote”   above for additional disclosures regarding voting, including voting by an   Intermediary. Ballots previously delivered may be withdrawn or revoked at any   time prior to the Voting Deadline by the claimant who completed the original   Ballot (or such claimant’s nominee). A Ballot may be revoked or withdrawn   either by submitting a superseding Ballot or by providing written notice to   the Voting Agent. To be effective, notice of revocation or withdrawal must:   (a) be received on or before the Voting Deadline by the Voting Agent at its   address specified in Section 1.4 above; (b) specify the name of the holder of   the Claim whose vote on the Plan is being withdrawn or revoked; (c) contain   the description of the Claim as to which a vote on the Plan is withdrawn or   revoked; and (d) be signed by the holder of the Claim in the same manner as   such holder signed the original Ballot. The foregoing procedures should also   be followed with respect to a person entitled to vote on the Plan who wishes   to change (rather than revoke or withdraw) its vote. ARTICLE X. DESCRIPTION   AND HISTORY OF CHAPTER 11 CASES 10.1. General Case Background. On May 20,   2019 (the “Petition Date”), each of the Debtors filed a voluntary petition   with the Bankruptcy Court for relief under chapter 11 of the Bankruptcy Code.   The Debtors’ Chapter 11 Cases have been jointly administered for procedural   purposes only. The Honorable Martin Glenn is presiding over the Chapter 11   Cases. The Debtors are continuing to operate their businesses and manage   their properties as debtors and debtors in possession pursuant to sections   1107 and 1108 of the Bankruptcy Code. Given the consensual nature of the   Proposed Restructuring Transaction and the significant amount of negotiations   that took place 84 

    

 

prior to   commencing these chapter 11 cases, the Debtors are seeking to emerge from   chapter 11 as quickly as possible. The following is a brief description of   certain significant events that have occurred in the initial stages of the   Chapter 11 Cases. 10.2. Procedural Motions. To ensure efficiency and   streamline the chapter 11 process, on the Petition Date the Debtors filed a   motion seeking the joint administration of their two Chapter 11 Cases for   procedural purposes only [Docket No. 3]. On May 24, 2019, the Bankruptcy Court   entered an order approving the motion and authorizing the joint   administration of these Chapter 11 Cases, for procedural purposes only under   Case No. 19-11632 [Docket No. 40]. To ease the administrative burden of these   cases on the Debtors’ estates, on the Petition Date the Debtors filed a   motion for entry of an order: (a) waiving the requirement for each Debtor to   file a list of creditors; (b) authorizing the Debtors to file a consolidated   list of creditors holding the thirty (30) largest unsecured claims; and (c)   authorizing the Debtors to establish procedures for notifying creditors of   the commencement of these cases. On May 24, 2019, the Bankruptcy Court   entered an order approving this motion [Docket No. 45]. On the Petition Date,   the Debtors also filed a motion seeking entry of an order that confirms the   application of four key protections provided by the Bankruptcy Code: (a) the   automatic stay provisions of section 362; (b) the ipso facto provisions of   section 365; (c) the anti-discrimination provisions of section 525; and (d)   the provisions regarding property of the estate in section 541. The global   nature of the Debtors’ business and their dealings with non-U.S. creditors,   who may be unfamiliar with the protections afforded chapter 11 debtors under sections   362, 365, 525 and 541 of the Bankruptcy Code, require that an order   implementing these protections be entered by this Court. On May 24, 2019, the   Bankruptcy Court entered an order approving this motion [Docket No. 39]. To   promote the efficient and orderly administration of these cases, the   Bankruptcy Court also entered an order approving the Debtors’ motion: (a)   establishing certain notice, case management, and administrative procedures   and omnibus hearing dates, and (b) granting related relief [Docket No. 82].   10.3. Retention of Professionals. To assist them in carrying out their duties   as debtors in possession, and to otherwise represent their interests in the   Chapter 11 Cases, the Debtors filed applications with the Bankruptcy Court   seeking to retain Willkie Farr & Gallagher LLP as restructuring counsel   [Docket No. 64], Moelis & Company LLC as investment banker and financial   advisor [Docket No. 66], AP Services, LLC as Chief Restructuring Officer   [Docket No. 56], Prime Clerk as administrative advisor [Docket No. 67], and   KPMG LLP as accounting and financial reporting advisor and tax consultant   [Docket No. 83]. The Bankruptcy Court entered orders approving the retention   applications for Willkie Farr & Gallagher LLP [Docket No. 142], AP   Services, LLC [Docket No. 139], Prime Clerk [Docket No. 141] and KPMG LLP   [Docket No. 140] on June 27, 2019 and Moelis [Docket No. [ ]] on [July 11,   2019]. 85 

    

 

In addition, on   the Petition Date, the Debtors filed with the Bankruptcy Court an application   seeking entry of an order, pursuant to 28 U.S.C. § 156(c), authorizing the   Debtors to retain Prime Clerk as the Debtors’ claims and noticing agent   [Docket No. 4], which was approved by the Bankruptcy Court on May 24, 2019   [Docket No. 41]. Additionally, on June 3, 2019, the Debtors filed with the   Bankruptcy Court a motion seeking authority, pursuant to section 327(e) of   the Bankruptcy Code, to employ certain additional professionals, utilized in   the ordinary course, to assist the Debtors in their day-to-day business   operations [Docket No. 67]. On June 27, 2019, the Bankruptcy Court entered an   order approving the motion [Docket No. 144]. 10.4. Employment Obligations.   The Debtors believe that they have a valuable asset in their workforce, and   that the efforts of the Debtors’ employees and independent contractors are   critical to a successful reorganization. On the Petition Date, the Debtors   filed with the Bankruptcy Court a motion for an order authorizing the Debtors   to pay certain prepetition employee wage and benefit obligations [Docket No.   9] (the “Employee Wage Motion”). In the Employee Wage Motion, the Debtors   requested to, among other things, satisfy certain of their prepetition   obligations to their current employees and independent contractors, reimburse   employees and independent contractors for prepetition travel and other   business expenses that were incurred on behalf of the Debtors, pay   prepetition payroll-related taxes and withholdings associated with the   Debtors’ employee wage claims and the employee benefit obligations, and other   similar tax obligations, continue honoring sales commissions for employees,   and to continue any employee benefit programs in place as of the Petition   Date (including satisfying any prepetition obligations associated with such   programs). The Bankruptcy Court entered an order on May 24, 2019 [Docket No.   48] and June 27, 2019 [Docket No. 147] approving the motion on an interim and   final basis, respectively. On May 30, 2019, the Debtors filed a motion   seeking Bankruptcy Court approval of the Debtors’ proposed key employee   retention plan and proposed key employee incentive plan [Docket No. 59]. [On   July 11, 2019, the Bankruptcy Court entered an order approving the motion   [Docket No. []]. 10.5. Continuing Supplier and Customer Relations. The   Debtors believe that maintaining good relationships with their vendors,   suppliers and customers is necessary to the continuity of the Debtors’   business operations during the Chapter 11 Cases. Accordingly, on the Petition   Date, the Debtors filed with the Bankruptcy Court a motion seeking entry of   an order authorizing the Debtors to pay, in the ordinary course of business,   prepetition claims of certain critical vendors (both domestic and foreign) of   goods and services, including certain claims of suppliers of goods entitled   to priority pursuant to section 503(b)(9) of the Bankruptcy Code [Docket No.   10]. The Bankruptcy Court entered an order on May 24, 2019 [Docket No. 42]   and June 27, 2019 [Docket No. 146] approving the motion on an interim and final   basis, respectively. 86 

    

 

In addition, on   the Petition Date, the Debtors filed with the Bankruptcy Court a motion   seeking entry of an order authorizing the Debtors to continue certain   prepetition customer programs, including, but not limited to, rebate   programs, discounts and chargebacks, and to satisfy, in the ordinary course   of business, certain prepetition claims arising from such programs [Docket   No. 12]. The Bankruptcy Court entered an order on May 24, 2019 [Docket No.   44] and June 27, 2019 [Docket No. 148] approving the motion on an interim and   final basis, respectively. On the Petition Date, the Debtors filed with the   Bankruptcy Court a motion requesting authority to pay, in their discretion,   any prepetition claims held by the Debtors’ common carriers, warehouse   providers, and freight forwarders [Docket No. 11]. The Bankruptcy Court   entered an order on May 24, 2019 [Docket No. 43] and June 27, 2019 [Docket   No. 145] approving the motion on an interim and final basis, respectively.   10.6. Cash Management System. The Debtors believe it would be disruptive to   their operations if they were forced to change significantly their cash   management system upon the commencement of the Chapter 11 Cases. Accordingly,   on the Petition Date, the Debtors filed with the Bankruptcy Court a motion seeking   entry of an order authorizing the Debtors to maintain their current cash   management system as well as to authorize certain intercompany transactions,   including those with the Debtors’ foreign non-Debtor subsidiaries [Docket No.   13]. The Bankruptcy Court entered an order on May 24, 2019 [Docket No. 46]   and June 27, 2019 [Docket No. 149] approving the motion on an interim and   final basis, respectively. 10.7. Tax Motion. On the Petition Date, the   Debtors filed with the Bankruptcy Court a motion seeking entry of an order   authorizing them to pay various prepetition sales and use, property and other   taxes to various federal, state and local authorities, and certain licensing,   permitting and regulatory fees to certain federal, state and local government   agencies on a periodic basis, in each case, as and when such obligations   become due [Docket No. 8]. The Bankruptcy Court entered an order on May 24,   2019 [Docket No. 49] and June 27, 2019 [Docket No. 138] approving the motion   on an interim and final basis, respectively. 10.8.Utilities. On May 28, 2019,   the Debtors filed with the Bankruptcy Court a motion for an order: (a)   prohibiting utilities from altering or discontinuing services; (b) providing   utility companies with adequate assurance of payment; and (c) establishing   procedures for resolving requests for additional assurance of payment [Docket   No. 53]. On June 20, 2019, the Bankruptcy Court entered an order approving   the motion [Docket No. 92]. 10.9. Schedules and Statements. On the Petition   Date, the Debtors filed their Schedules of Assets and Liabilities and   Statements of Financial Affairs [Docket No. 18] (the “Schedules”). The   Schedules are available electronically free of charge at   https://primeclerk.com/aegerion. 87 

    

 

10.10.Bar   Dates. On the Petition Date, the Debtors filed with the Bankruptcy Court a   motion [Docket No. 7] seeking an order establishing the deadlines (each, a   “Bar Date”) for filing proof of certain claims against the Debtors that arose   on or prior to the Petition Date and approving the form and manner of notice   of each Bar Date. On May 28, 2019, the Bankruptcy Court entered an order   approving the motion [Docket No. 51] setting the Bar Date as July 3, 2019 for   general proofs of claim. The deadline for governmental units to file proofs   of claim is set as November 16, 2019. 10.11. The DIP Facility. On the   Petition Date, the Debtors filed a motion seeking entry of an order by the   Bankruptcy Court authorizing the use of cash collateral on an interim basis   and to schedule a final hearing to enter into that certain   Debtor-in-Possession Credit Agreement, pursuant to which the lenders   thereunder shall: (a) provide postpetition debtor in possession financing on   a priming, secured basis to the Debtors in the amount of $20 million; and (b)   provide “adequate protection” to prepetition secured lenders [Docket No. 14].   On May 24, 2019, the Bankruptcy Court entered an interim order granting   approval of the use of cash collateral [Docket No. 47]. On June 27, 2019, the   Bankruptcy Court entered an order approving the use of cash collateral on a   final basis and approved the Debtors’ entry into the DIP facility [Docket No.   150]. 10.12.Motion to Approve Certain Bid Protections Contained in the Plan   Funding Agreement. On the Petition Date, the Debtors filed a motion with the   Bankruptcy Court seeking approval of certain bid protections for the Plan   Investor. Specifically, the Debtors sought entry of an order: (a) approving   and authorizing the Debtors to pay the Plan Investor: (i) a termination fee when   and if payable pursuant to the terms of the Plan Funding Agreement, and (ii)   all reasonable and documented fees and expenses incurred by the Plan Investor   in connection with the negotiation, preparation and implementation of the   Plan Funding Agreement and related documents; (b) approving the market check   and related procedures pursuant to Section 6.9 of the Plan Funding Agreement;   and (c) approving the termination rights pursuant to Sections 8.1(a), (b) and   (c) of the Plan Funding Agreement and Section 2.1 of the RSA [Docket No. 17].   On June 27, 2019, the Bankruptcy Court entered an order approving the motion   [Docket No. 137] and pursuant to the terms of the Plan Funding Agreement, the   Debtors are currently in the “Go-Shop Period” that lasts until August 21,   2019. In accordance with the PFA Order, the Committee intends to be actively   involved in the Debtors’ efforts to solicit an alternative transaction during   the “Go-Shop Period” to ensure a robust marketing process. The Committee was   granted various consultation and information rights under the PFA Order,   including the Debtors’ obligation to provide the Committee with: (i) access   to all Company Alternative Proposals and related developments; (ii) access to   non-public information granted to all Persons and Representatives in   connection with Section 6.9 of the Plan Funding Agreement; and (iii)   participation rights in discussions with any party that has made a proposal   or been solicited. 10.13.Motion to Approve Payment of Certain Prepetition   Government Settlement Claims. 88 

    

 

On the Petition   Date, the Debtors, with the support of the Plan Support Parties, filed a   motion seeking Bankruptcy Court relief to allow them to continue making all   ongoing payments under the Government Settlement Agreements that arise during   these chapter 11 cases in the ordinary course of business [Docket No. 15]. On   June 27, 2019, the Bankruptcy Court entered an order approving the motion   [Docket No. 152]. 10.14.Motion to Assume the Shared Services Agreements. On the   Petition Date, the Debtors filed a motion seeking Bankruptcy Court approval   to allow the Debtors to assume the Shared Services Agreements, as amended   [Docket No. 16]. While the Debtors originally sought to assume the amended   Shared Services Agreements on a final basis during the preliminary stages of   the Chapter 11 Cases, pursuant to an agreement with the Committee [Docket No.   108] the Debtors agreed to seek interim authority to continue operating under   the Shared Services Agreements during the pendency of the Chapter 11 Cases   and to delay seeking authority to assume such agreements until the expiration   of the Committee’s challenge period under the DIP Order. On June 27, 2019,   the Bankruptcy Court entered an order approving the motion on an interim   basis [Docket No. 151]. 10.15.Appointment of an Official Committee of   Unsecured Creditors. The Committee was appointed by the United States Trustee   pursuant to section 1102(a)(1) of the Bankruptcy Code on May 29, 2019 to   represent the interests of the Debtors’ unsecured creditors [Docket No. 56].   The Committee consists of Bank of New York Mellon, as Convertible Notes   Indenture Trustee, and Mosaic Solutions, as holder of a General Unsecured   Claim against the Debtors. The 341 meeting of creditors took place on July 11,   2019. In accordance with the Committee’s fiduciary duties under section 1103   of the Bankruptcy Code and consistent with the rights granted to the   Committee pursuant to the final order approving the Debtors’ postpetition   debtor-in-possession financing facility [Docket No. 150] (the “Final DIP   Order”), the Committee is in the process of conducting an investigation of   the Debtors’ stipulations and releases in the Final DIP Order relating to (i)   the Bridge Loan Lenders’ liens and claims in connection with or related to   the Prepetition Bridge Loan Obligations (as defined in the Final DIP Order),   or the actions or inactions of any of the Bridge Loan Lenders arising out of   or related to the Prepetition Bridge Loan Obligations or the Prepetition   Bridge Loan Documents (as defined in the Final DIP Order), and (ii) Novelion   in connection with or related to the amounts outstanding under the Novelion   Intercompany Loan (including both the “contested” and “uncontested” amounts   referenced in the Final DIP Order), or the actions or inactions of Novelion   arising out of or related to the Novelion Intercompany Loan Obligations (as   defined in the Final DIP Order). The Committee’s deadline to challenge the   Debtors’ stipulations set forth in the Final DIP Order, as it pertains to the   Prepetition Secured Parties and their liens and claims against the Debtors,   is August 27, 2019.29 In addition, the 29 If the RSA is terminated prior to   August 27, 2019, the Committee’s Challenge Deadline (as defined herein) shall   be automatically extended to October 11, 2019. If prior to the termination of   the Committee’s Challenge Deadline, the Committee files a motion seeking   standing to pursue any challenge which includes a copy of any proposed   objection or adversary complaint containing a description of the claims and   causes of action the Committee proposes to pursue, then the Committee’s   Challenge Deadline shall be 89 

    

 

Committee is   also investigating any prepetition transactions consummated by the Debtors as   well as the prepetition relationship between the Debtors and Novelion   (including pursuant to the Shared Services Agreements and related   amendments). As discussed in Article XI hereof, the outcome of the   Committee’s investigation, and any successful challenge commenced by the   Committee, could have a material impact on the Plan structure and recoveries   for creditors under the Plan. ARTICLE XI. CERTAIN RISK FACTORS TO BE   CONSIDERED 11.1. Certain Bankruptcy Considerations. (a) General. Although the   Plan is designed to implement the restructuring transactions contemplated   thereby and provide distributions to creditors in an expedient and efficient   manner, it is impossible to predict with certainty the amount of time that   the Debtors may spend in bankruptcy or to assure parties in interest that the   Plan will be confirmed. If the Debtors are unable to obtain confirmation of   the Plan on a timely basis because of a challenge to confirmation of the Plan   or a failure to satisfy the conditions to consummation of the Plan, they may   be forced to operate in bankruptcy for an extended period while they try to   develop a different chapter 11 plan that can be confirmed. Such a scenario   could jeopardize the Debtors’ relationships with their key vendors and   suppliers, customers and employees, which, in turn, would have an adverse   effect on the Debtors’ operations. A material deterioration in the Debtors’   operations likely would diminish recoveries under any subsequent chapter 11   plan. Further, in such event, the Debtors may not have sufficient liquidity   to operate in bankruptcy for such an extended period. automatically extended   until the date that is five (5) business days after the Bankruptcy Court   rules on such request. 90 Important Risks to Be Considered Holders of Claims   should read and consider carefully the following risk factors and the other   information in this Disclosure Statement, the Plan, the Plan Supplement and   the other documents delivered or incorporated by reference in this Disclosure   Statement and the Plan, before voting to accept or reject the Plan. These   risk factors should not, however, be regarded as constituting the only risks   involved in connection with the Plan and its implementation. 

    

 

(b) Failure to   Receive Requisite Acceptances. Claims in Classes 3, 4 and 6B are the only   Claims that are entitled to vote to accept or reject the Plan. Although the   Debtors believe they will receive the requisite acceptances, the Debtors   cannot provide assurances that the requisite acceptances to confirm the Plan   will be received for at least one of these Classes. If the requisite   acceptances are not received for at least one of these Classes, the Debtors   will not be able to seek confirmation of the Plan under section 1129(b) of   the Bankruptcy Code because at least one impaired Class will not have voted   in favor of the Plan as required by section 1129(a)(10) of the Bankruptcy   Code. In such a circumstance, the Debtors may seek to accomplish an   alternative restructuring of their capitalization and obligations to   creditors and obtain acceptances of an alternative plan of reorganization for   the Debtors, or otherwise, that may not have the support of the Plan Support   Parties and/or may be required to liquidate these estates under chapter 7 or   11 of the Bankruptcy Code. There can be no assurance that the terms of any   such alternative restructuring arrangement or plan would be similar to, or as   favorable to the Debtors’ creditors as, those proposed in the Plan. (c) The   Committee’s Investigation Could Impact Its Position on the Plan. The outcome   of the Committee’s investigation could impact its ultimate position on the   Plan and the Proposed Restructuring Transaction, and any successful challenge   by the Committee could have a material impact on creditors’ recoveries,   treatment, and distributions under the Plan. Moreover, the Committee’s   position on the Plan may not be formulated prior to the Voting Deadline, as   the Committee’s Challenge Deadline is scheduled to expire on August 27, 2019   (the “Committee’s Challenge Deadline”), subject to extension under certain   circumstances. (d) Failure to Secure Confirmation of the Plan. Even if the   requisite acceptances are received, the Debtors cannot provide assurances   that the Bankruptcy Court will confirm the Plan. A non-accepting creditor or   equity security holder of the Debtors might challenge the balloting   procedures and results as not being in compliance with the Bankruptcy Code or   the Bankruptcy Rules. Even if the Bankruptcy Court determined that the   Disclosure Statement and the balloting procedures and results were   appropriate, the Bankruptcy Court could still decline to confirm the Plan if   it found that any of the statutory requirements for confirmation had not been   met. Section 1129 of the Bankruptcy Code sets forth the requirements for   confirmation and requires, among other things, a finding by the Bankruptcy   Court that the confirmation of the Plan is not likely to be followed by a   liquidation or a need for further financial reorganization and that the value   of distributions to non-accepting holders of claims and interests within a   particular class under the Plan will not be less than the value of   distributions such holders would receive if the debtor were liquidated under   chapter 7 of the Bankruptcy Code. While the Debtors cannot provide assurances   that the Bankruptcy Court will conclude that these requirements have been   met, the Debtors believe that the Plan will not be followed by a need for   further financial reorganization and that non-accepting holders within each   Class under the Plan will receive distributions at least as great as would be   received following a liquidation under chapter 7 of the Bankruptcy Code when   taking 91 

    

 

into   consideration all administrative claims and the costs and uncertainty   associated with any such chapter 7 case. If the Plan is not confirmed, the   Plan will need to be revised and it is unclear whether a restructuring of the   Debtors could be implemented and what distribution holders of Claims   ultimately would receive with respect to their Claims. If an alternative   reorganization could not be agreed to, it is possible that the Debtors would   have to liquidate their assets, in which case it is likely that holders of   Claims would receive substantially less favorable treatment than they would   receive under the Plan. There can be no assurance that the terms of any such   alternative restructuring arrangement or plan would be similar to or as   favorable to the Debtors’ creditors as those proposed in the Plan. (e)   Failure to Consummate the Plan. Section 11.1 of the Plan contains various   conditions to consummation of the Plan, including the Confirmation Order   having become final and non-appealable, the Debtors having entered into the   Plan Documents, in form and substance satisfactory to the Required Parties,   and all conditions precedent to effectiveness of such agreements having been   satisfied or waived in accordance with the terms thereof. As of the date of   this Disclosure Statement, there can be no assurance that these or the other   conditions to consummation will be satisfied or waived. Accordingly, even if   the Plan is confirmed by the Bankruptcy Court, there can be no assurance that   the Plan will be consummated and the restructuring completed. If the Plan is   not consummated and the restructuring completed, these Chapter 11 Cases will   be prolonged and the Debtors may lack sufficient liquidity to effect a   successful restructuring under chapter 11 of the Bankruptcy Code. Moreover,   the Plan is predicated on, among other things, receipt of the Rights Offering   Amount. Notwithstanding the Backstop Commitment Agreement, because the Rights   Offering has not been completed, there can be no assurance that the Debtors   will receive any or all of the Rights Offering Amount. In addition, under the   RSA and the Backstop Commitment Agreement, the Plan Support Parties and the   Backstop Parties, respectively, have the contractual right to terminate the   RSA and the Backstop Commitment Agreement if, among other reasons, the   deadlines set forth in such agreements or the various conditions precedent to   the enforcement of the obligations of the parties thereto are not satisfied.   If either the RSA or Backstop Commitment Agreement is terminated, the Debtors   may not be able to consummate the Plan in its current form. Moreover, in   consideration for their commitment to backstop the Rights Offering, the   Backstop Parties will receive a backstop premium equal to 5% of the Rights   Offering Amount, which is payable upon the Effective Date pursuant to the   terms and conditions of the Backstop Commitment Agreement. (f) Objections to   Treatment of Claims. Section 1129(b) of the Bankruptcy Code provides that a   plan of reorganization must not discriminate unfairly with respect to each   class of claims or interests. Holders of Claims or Interests or other parties   in interest, including existing shareholders of Novelion, may 92 

    

 

argue that the   Plan discriminates unfairly with respect to their Claims or Interests. The   Debtors believe that the treatment of each Class of Claims or Interests   complies with the requirements set forth in the Bankruptcy Code. There can be   no assurance, however, that the Bankruptcy Court will reach the same   conclusion. (g) Objections to Classification of Claims. Section 1122 of the   Bankruptcy Code provides that a plan of reorganization may place a claim or   an interest in a particular class only if such claim or interest is   substantially similar to the other claims or interests in such class. The   Debtors believe that the classification of Claims and Interests under the   Plan complies with the requirements set forth in the Bankruptcy Code. There   can be no assurance, however, that the Bankruptcy Court will reach the same   conclusion. (h)The Debtors May Object to the Amount or Classification of Your   Claim. The Debtors reserve the right to object to the amount or   classification of any Claim. It is the Debtors’ position that the estimates   set forth in this Disclosure Statement cannot be relied on by any creditor   whose Claim or Interest is subject to an objection. Any such Claim holder may   not receive its specified share of the estimated distributions described in   this Disclosure Statement. (i) The Debtors May Adjourn Certain Deadlines. In   certain circumstances, the Debtors may deem it appropriate to adjourn either   or both of the Voting Deadline and/or the Confirmation Hearing. While the   Debtors estimate that the Effective Date will occur on or around September   30, 2019, in accordance with the milestones set forth in the RSA, they cannot   provide assurances that applicable dates related to the foregoing will not be   extended and the Effective Date will not be delayed. (j) The DIP Facility May   Not Become Available to the Debtors. On the Petition Date, the Debtors sought   Bankruptcy Court approval of the DIP Credit Agreement to provide for funding   during the pendency of the Chapter 11 Cases. If the Chapter 11 Cases take   longer than expected to conclude, the Debtors may exhaust their financing. There   is no assurance that the Debtors will be able to obtain additional financing   from their existing lenders or otherwise. In addition, in the event of the   occurrence of an event of default under the DIP Credit Agreement, the DIP   Lenders may seek, among other things, to exercise remedies with respect to   the collateral securing the DIP facility, and to take certain other actions   against the Debtors. In each of these cases, the liquidity necessary for the   orderly functioning of the Debtors’ businesses may be materially impaired.   (k) Whitefort Dispute. On June 20, 2019, Whitefort Capital Master Fund, LP   (“Whitefort”), which is a shareholder of Novelion, filed a petition against   Novelion in the Supreme Court of British Columbia, seeking entry of an order,   among other things: (a) declaring that Novelion breached Canadian corporate   law when it entered into the RSA; (b) requiring Novelion to hold a special 93   

    

 

meeting for   shareholders to vote to determine whether Novelion should enter into the RSA;   and (c) providing that, unless and until Novelion shareholders vote to enter   into the RSA, Novelion shall be enjoined from consummating the transactions   contemplated thereunder and that Novelion be required to vote its claim in   the Chapter 11 Cases against the Plan. The Debtors, Novelion, the Plan   Investor and the lenders party to the RSA do not believe that Whitefort’s   action is likely to be successful and believe that the Plan is confirmable as   proposed. On June 24, 2019, Novelion filed a form 8-K with the SEC where it   vigorously disputed the claims made in the Whitefort action. Specifically,   Novelion stated the following: “Novelion believes that the Whitefort Action   lacks any merit and that, contrary to Whitefort’s allegations, Novelion’s   entry into the RSA providing for the treatment of the Intercompany Loan and   Novelion’s support of the Plan of Reorganization comply fully with applicable   law and no approval of the Novelion shareholders is required in connection   therewith. Novelion intends to vigorously defend against the Whitefort   Action.” Novelion Therapeutics Inc., Current Report (Form 8-K), at p. 2 (June   24, 2019). On July 3, 2019, Novelion filed its response to Whitefort’s   complaint in the Canadian proceeding arguing, among other things, that: the   act of entering into the RSA did not constitute a disposition of all or   substantially all of Novelion’s assets for purposes of Canadian law; the   Novelion Intercompany Loan does not constitute all or substantially all of   Novelion’s assets; and Novelion’s directors acted honestly, diligently and in   good faith when negotiating the Proposed Restructuring Transaction. On July   5, 2019, Whitefort filed its reply brief. A hearing on the Whitefort action   was held on July 9, 2019. As of the date hereof, no decision has been   rendered. The Debtors reserve all rights with respect to Whitefort — both in   these chapter 11 cases and in the Canadian proceeding described above —   including, but not limited to, pursuing the Proposed Restructuring   Transaction without the support of Novelion. Specifically, in the event that   Novelion, as a result of the proceeding commenced by Whitefort, breaches the   RSA and either does not vote to accept the Plan or votes to reject the Plan,   the Debtors reserve their rights to pursue all rights and remedies available   to them, including: (a) seeking to recharacterize all or a portion of the   Novelion Intercompany Loan Claim; (b) assigning the Debtors’ claims or causes   of action against Novelion to a litigation trust or granting standing to the   Committee to pursue such claims or causes of action; (c) amending the Plan to   provide for an alternative treatment of the Novelion Intercompany Loan Claim,   including treatment on account of any reduction in the allowed amount, or   priority of, such claim; and/or (d) requesting confirmation of the Plan   pursuant to section 1129(b) of the Bankruptcy Code, notwithstanding the   non-acceptance of the Plan by Novelion, and issuing on the Effective Date, in   lieu of New Common Stock, replacement notes with a present value equal to the   Allowed amount of the Novelion Intercompany Loan Claim. 11.2. Risks Relating   to the Capital Structure of the Reorganized Debtors. (a) Variances from   Financial Projections. The Financial Projections included as Exhibit 3 to   this Disclosure Statement reflect numerous assumptions, which involve   significant levels of judgment and estimation 94 

    

 

concerning the   anticipated future performance of the Reorganized Debtors, as well as   assumptions with respect to the prevailing market, economic and competitive   conditions, which are beyond the control of the Reorganized Debtors, and   which may not materialize. Any significant differences in actual future   results versus estimates used to prepare the Financial Projections, such as   lower sales, lower volume, lower pricing, increases in production costs,   technological changes, environmental or safety issues, workforce disruptions,   competition or changes in the regulatory environment, could result in   significant differences from the Financial Projections. The Debtors believe   that the assumptions underlying the Financial Projections are reasonable.   However, unanticipated events and circumstances occurring subsequent to the   preparation of the Financial Projections may affect the Debtors’ and the Reorganized   Debtors’ ability to initiate the endeavors and meet the financial benchmarks   contemplated by the Plan. Therefore, the actual results achieved throughout   the period covered by the Financial Projections necessarily will vary from   the projected results, and these variations may be material and adverse. (b)   Leverage. Although the Reorganized Debtors will have less indebtedness than   the Debtors, the Reorganized Debtors will still have secured indebtedness. On   the Effective Date, after giving effect to the transactions contemplated by   the Plan, in addition to payment of Claims, if any, that require payment   beyond the Effective Date and ordinary course debt, the Reorganized Debtors   will, on a consolidated basis, have approximately $82 million in secured   indebtedness. The degree to which the Reorganized Debtors will be leveraged   could have important consequences because: • it could affect the Reorganized   Debtors’ ability to satisfy their obligations under their secured   indebtedness following the Effective Date; a portion of the Reorganized   Debtors’ Cash flow from operations will be used for debt service and   unavailable to support operations, or for working capital, capital   expenditures, expansion, acquisitions or general corporate or other purposes;   • • the Reorganized Debtors’ ability to obtain additional debt financing or   equity financing in the future may be limited; and • the Reorganized Debtors’   operational flexibility in planning for, or reacting to, changes in their   businesses may be severely limited. 95 

    

 

(c) Ability to   Service Debt. Although the Reorganized Debtors will have less indebtedness   than the Debtors, the Reorganized Debtors will still have interest expense   and principal repayment obligations. The Reorganized Debtors’ ability to make   payments on and to refinance their debt will depend on their future financial   and operating performance and their ability to generate cash in the future.   This, to a certain extent, is subject to general economic, business,   financial, competitive, legislative, regulatory and other factors that are   beyond the control of the Reorganized Debtors. Although the Debtors believe   the Plan is feasible, there can be no assurance that the Reorganized Debtors   will be able to generate sufficient cash flow from operations or that sufficient   future borrowings will be available to pay off the Reorganized Debtors’ debt   obligations. The Reorganized Debtors may need to refinance all or a portion   of their debt on or before maturity; however, there can be no assurance that   the Reorganized Debtors will be able to refinance any of their debt on   commercially reasonable terms or at all. (d) The Implied Valuation of New   Common Stock Is Not Intended to Represent the Trading Value of the New Common   Stock.30 The value of the New Common Stock to be distributed under the Plan,   as implied from the Plan Funding Agreement, is not intended to represent the   trading values of New Common Stock in public or private markets and is   subject to additional uncertainties and contingencies, all of which are   difficult to predict. Actual market prices of such securities at issuance   will depend upon, among other things: (1) prevailing interest rates; (2)   conditions in the financial markets; (3) the anticipated initial securities   holdings of prepetition creditors, some of which may prefer to liquidate   their investment rather than hold it on a long term basis; and (4) other   factors that generally influence the prices of securities, including whether   the shares of New Common Stock will be listed on NASDAQ and if so, the timing   of such listing. Actual market prices of the New Common Stock also may be   affected by the Chapter 11 Cases or by other factors not possible to predict.   Accordingly, the implied value stated herein and the Plan of the securities   to be issued does not necessarily reflect, and should not be construed as   reflecting, values that will be attained for the New Common Stock in the   public or private markets. (e) Variance in Amount of Shares of New Common   Stock Issued. The number of shares of New Common Stock to be issued under the   Plan has not been fixed and could vary from the Debtors’ projections. (f) The   Obligations of the Plan Investor Under the Plan Funding Agreement May Be   Terminated in Certain Circumstances. Pursuant to the Plan Funding Agreement,   the Plan Investor may terminate the Plan Funding Agreement in certain   circumstances, including, among other conditions, (a) by 30 The implied   equity value of the combined reorganized company is $370.7 million, as set   forth in Schedule 1.92 of Exhibit 1 hereto. In addition, upon entering into   the RSA, the parties agreed that for purposes of the Proposed Restructuring   Transaction, a $395 million enterprise value would be ascribed to Aegerion   and a $146 million enterprise value would be ascribed to Amryt. 96 

    

 

mutual   agreement with Aegerion, (b) if closing of the transaction has not occurred   by 150 days after the filing of these chapter 11 cases, subject to extension   as provided in the Plan Funding Agreement, (c) the Debtors enter into an Alternative   Transaction Agreement (as defined in the Plan Funding Agreement), or (d) upon   the termination of the RSA. To the extent the Plan Funding Agreement is   terminated due to the consummation of a superior alternative transaction, the   Plan Investor may be entitled to the Plan Investor Termination Fee and Plan   Investor Expense Reimbursement Amount (as defined in, and subject to the   terms of, the Plan Funding Agreement). 11.3. Risks Relating to Tax   Consequences of the Plan. Certain Tax Consequences of the Plan Raise   Unsettled and Complex Legal Issues and Involve Factual Determinations. The   federal income tax consequences of the Plan are complex and are subject to   significant uncertainties. The Debtors currently do not intend to seek any   ruling from the Internal Revenue Service (“IRS”) on the tax consequences of   the Plan. Thus, there can be no assurance that the IRS will not challenge the   various positions the Debtors have taken, or intend to take, with respect to   the tax treatment in the Plan, or that a court would not sustain such a   challenge. 11.4. Risks Associated with the Debtors’ Businesses. THE FOLLOWING   PROVIDES A SUMMARY OF CERTAIN OF THE RISKS ASSOCIATED WITH THE DEBTORS’   BUSINESSES. HOWEVER, THIS SECTION IS NOT INTENDED TO BE EXHAUSTIVE. (a) The Debtors’   Chapter 11 Cases May Negatively Impact the Company’s Future Operations. While   the Debtors believe that they will be able to emerge from chapter 11   relatively expeditiously, there can be no assurance as to timing for approval   of the Plan or the Debtors’ emergence from chapter 11. Additionally,   notwithstanding the support of the Plan Support Parties, the Chapter 11 Cases   may adversely affect (i) the Debtors’ ability to retain existing employees,   contractors, third party vendors and suppliers, (ii) the perception of   patients and prescribers of the Debtors and their products, and (iii) the   Debtors’ ability to meet financial targets, maintain and enter into contracts   that are critical to their operations, and also may result in unanticipated   costs and expenses. (b) The Debtors Are Dependent Upon Two Products,   Lomitapide and Metreleptin, to Generate All of Their Revenues and These   Products May Not Be Successful and May Not Generate Sales at Anticipated   Levels. The Debtors are entirely dependent upon their two products to   generate all of their revenues. The Debtors’ ability to meet expectations   with respect to sales of lomitapide and metreleptin, and to generate revenues   from such sales, and attain and maintain positive cash flow from operations,   in the time periods they anticipate, or at all, will depend on a number of   factors, including, among others, (i) the ability to continue to maintain and   grow market acceptance for 97 

    

 

lomitapide and   metreleptin among healthcare professionals and patients in the U.S. and other   key markets in the treatment of their approved indications, (ii) the degree   to which both physicians and patients determine that the safety and side   effect profile of lomitapide and metreleptin are manageable, and that the side   effect profile in the commercial setting is substantially consistent with   that of the clinical setting, (iii) maintaining and securing regulatory   approvals in key markets on a timely basis and with commercially feasible   labels, and pricing and reimbursement approvals in key markets, where   required, on a timely basis and at adequate levels of pricing and   reimbursement, (iv) continuing to generate revenues in markets that allow for   sales of pharmaceutical products in their markets without regulatory approval   based on the approvals of such products in the U.S. or EU, and in which no   promotion or commercialization activities are permitted, and (v) adequately   investing in the sales, marketing, market access, medical affairs and other   functions that are supportive of the Debtors’ commercialization efforts. In   addition, the markets that the Debtors operate in are highly competitive, and   this competition could harm their results of operations, cash flows and   financial condition. The Debtors’ competitors include major international   pharmaceutical companies as well as smaller regional specialty pharmaceutical   and biotechnology companies. The Debtors may be forced to lower the selling   price of their products based on their competitors’ pricing decisions or   could lose patients to lower priced products, which would reduce revenues and   could harm their results of operations. As noted herein, nearly all of the   Debtors’ competitors are larger, have greater financial resources, have a   lower cost structure, and/or have less debt than the Debtors do. As a result,   those competitors may be better able to withstand a change in conditions   within the Debtors’ industry and in the economy as a whole. If the Debtors do   not compete successfully, their operating margins, financial condition and   cash flows could be adversely affected. A very significant competitor to the   Debtors’ lomitapide product is a class of drugs known as PCSK9 inhibitors,   which treat the same indication that lomitapide is approved to treat and is   much less expensive than lomitapide. Two products within this class are   approved and commercialized in the U.S. and other key markets by very large,   multinational pharmaceutical companies, and have had a very significant   impact on sales of lomitapide and the Debtors expect this negative trend to   continue. The Debtors also anticipate that they will continue to incur   significant costs associated with commercializing lomitapide and metreleptin,   and in connection with their ongoing clinical efforts and post-marketing   commitments for these products. (c) Risks Related to the Size of the Debtors’   Potential Customer Base. The number of patients suffering from the diseases   for which the Debtors’ products are approved is very small, and has not been   established with precision. As a result, the Debtors’ assumptions and   estimates regarding prevalence and the treatable population of patients for   their products may be wrong. If the actual number of patients is smaller than   estimated or if any approval outside the U.S., EU and the other countries   where lomitapide is approved or outside the U.S. or EU for metreleptin, is   based on a narrower definition of these patient populations, the Debtors’   revenues and the ability to achieve profitability and to attain and maintain   cash-flow positive operations from their product businesses will be adversely   affected, possibly materially. 98 

    

 

(d) The Debtors   Depend on Their Intellectual Property Rights and License Agreements. The   Debtors’ success depends in part on the ability to protect their intellectual   property rights, and the Debtors’ inability to enforce these rights could   have a material adverse effect on competitive position. The Debtors rely on   the patent, regulatory exclusivity, trademark, copyright, and trade-secret   laws of the United States, the European Union, and the countries and regions   where it does business to protect their intellectual property rights and   products from competition. The Debtors may be unable to prevent third parties   from using their intellectual property without proper authorization. The   unauthorized use of their intellectual property could reduce any competitive   advantage the Debtors have developed, reduce market share, or otherwise harm   business. In the event of unauthorized use of the Debtors’ intellectual   property, litigation to protect or enforce the Debtors’ rights could be   costly, and the Debtors may not prevail. Aegerion has entered into a number   of key license agreements that enable it and their non-Debtor subsidiaries to   have rights to develop and commercialize their products. These agreements   impose various diligence, payment, reporting and other obligations on   Aegerion. If Aegerion fails to comply with such obligations or encounter   disagreements with its licensors, it could lose license rights that are   critically important to its business and this could have a material adverse   effect on its business, financial condition and results of operations. In   addition, any disputes with Aegerion’s licensors could be costly and   expensive, and Aegerion may not prevail in such disputes. In addition, the   Debtors’ commercial success with respect to their products depends   significantly on their ability to obtain and maintain regulatory exclusivity   for their products and to protect their existing patent positions. If the   Debtors do not adequately protect their intellectual property, competitors,   including companies that sell generics, may be able to erode or negate any   competitive advantage the Debtors may have, which could harm their business   and ability to achieve expected financial results. The Debtors’ ability to   use the patents and patent applications licensed to them will also depend on   their ability to comply with the terms of the applicable licenses and other   agreements and to obtain requisite licenses. The laws of some foreign   countries do not protect their proprietary rights to the same extent as the   laws of the U.S., and the Debtors may encounter significant problems in   protecting their proprietary rights in these countries. (e) The Loss of One   or More of the Debtors’ Key Personnel Could Disrupt Operations and Adversely   Affect Financial Results. The Debtors are highly dependent upon the   availability and performance of their executive officers, other key employees   and their employees generally given the recent cost reductions and employee   attrition that followed. Accordingly, the loss of services of any of the   Debtors’ executive officers or key employees, or of a critical mass of   employees, which risks are further heightened by these Chapter 11 Cases and   the resulting acquisition of Aegerion by Amryt, could materially adversely   affect the Debtors’ business, financial condition and operating results. 99 

    

 

(f) The Debtors   Are Subject to Extensive Regulatory and Compliance Obligations Due to Being a   Pharmaceutical Company with Commercial Products, and Seeking the Approval of   Pharmaceutical Products, and Also Due to the Compliance Obligations that the   Debtors Are Required to Comply with Under Their Settlements with the DOJ, SEC   and Other Government Agencies. As a pharmaceutical company that develops and   commercializes pharmaceutical products, the Debtors are subject to an   extensive array of broad and complex laws and regulations applicable to their   business. These include, without limitation, regulations and laws in the U.S.   and outside the U.S. related to manufacturing, clinical, quality, drug   safety, commercialization, payments to and interactions with healthcare   professionals and healthcare organizations, anti-kickbacks, fraud and abuse,   the requirement to report payments and other transfers of value to healthcare   professionals and healthcare organizations, data protection and privacy,   pricing, reimbursement, price reporting, anti-corruption and anti-bribery,   and a myriad of other areas and levels of regulation, some of which are   described below. The failure of the Debtors’, the Debtors’ subsidiaries, or   their key vendors, contractors, distributors, licensors or other key third   party vendors or service providers to comply with such laws and regulations   could have a material adverse effect on the Debtors’ results of operations   and financial condition, could result in product approvals being suspended,   withdrawn, delayed or denied, could result in litigation and/or   investigations which could be costly and be a significant distraction to   executive management and other employees, and could result in damages or   prosecution. In addition, as noted herein, the Debtors are subject to   agreements and documents with extensive payment, remedial and compliance   measures as a result of Aegerion’s global settlement of the investigations   conducted by the DOJ and SEC, which could negatively impact their results of   operations and financial condition. In addition, the failure to comply with   any provisions of the settlement and settlement documents, including the   financial, remedial and compliance measures, could result in the imposition   of additional fines, penalties and obligations, and could subject Aegerion to   prosecution and/or exclusion from federal healthcare programs in the U.S. (g)   DOJ and SEC Settlements. As discussed in Section 3.4 above, the Debtors are   subject to numerous government settlement agreements regarding Aegerion’s   previous marketing and sale of JUXTAPID in the United States, including the   Plea Agreement, DOJ Civil Settlement Agreement, FDA Consent Decree, CIA, SEC   final judgment, and certain state settlement agreements. While all   obligations under the Government Settlement Agreements will be honored in   full, the Debtors rely on the cooperation of these government agencies in   order to implement a successful restructuring process. (h) Legal Matters and   Ongoing Investigations. The Debtors are party to routine litigation   incidental to their businesses. It is not anticipated that any current or   pending lawsuit, either individually or in the aggregate, is likely to have a   material adverse effect on the Debtors’ financial condition. No assurance can   be 100 

    

 

provided,   however, that the Debtors will be able to successfully defend or settle all   pending or future purported claims, and the Debtors’ failure to do so may   have a material adverse effect on the Reorganized Debtors. (i) The Debtors’   Sales, Marketing and Distribution Capabilities. The Debtors are marketing and   selling JUXTAPID and MYALEPT directly in the U.S. using their own marketing   and sales resources. The Debtors are also marketing and selling, or plan to   market and sell, metreleptin directly, using their own marketing and sales   resources, in certain key countries in the EU and in several other countries   in which metreleptin may be approved or where lomitapide is, or may be,   approved. The laws and regulations in the areas of sales and marketing of   pharmaceutical products, and interacting with healthcare professionals and   patients, are very complex and onerous, and require a robust compliance   program. The failure of the Debtors to comply with these laws and regulations   could have a material adverse effect on the Debtors’ business, financial   condition and results of operations. For example, the failure to comply with   certain of these laws and regulations led to the DOJ investigations and the   resulting financial penalties and remedial and compliance measures. In the   course of ordinary business, the Debtors also use, and plan to use, third   parties to provide warehousing, shipping, third-party logistics, invoicing,   collections and other distribution services on their behalf in the U.S. and   in other countries throughout the world. The failure of the Debtors to   establish, maintain and finance the capabilities to sell, market or   distribute their products, either through their own capabilities or through   arrangements with third parties and to effectively manage such third parties,   could result in the Debtors not being able to successfully sell their   products and could, as a result, have a material adverse effect on their   financial condition and results of operations. In addition, to the extent the   Debtors rely on third parties to distribute or commercialize their products,   if marketing approval is obtained in the relevant country, they would receive   less revenue than if they commercialized the product themselves. The Debtors   would also have less control over the sales efforts of any third parties   involved in their commercialization efforts, including, in some countries,   pricing, which could also have a negative effect on the Debtors’ revenues in   the specific market and other key markets if the price is lower than in other   markets and becomes a reference price for other markets. Use of a third party   can also make it more difficult to ensure that commercialization activities   are conducted in a manner compliant with applicable laws. (j) Regulatory Approvals   for the Debtors. The Debtors only have regulatory approval for commercial   distribution and reimbursement of lomitapide in the U.S., EU and a small   number of other countries. The Debtors are currently only permitted to   commercialize metreleptin in the U.S. and certain countries in the EU. The   Debtors may not receive the requisite regulatory approvals for   commercialization and reimbursement of their products in other countries. The   Debtors also rely on named patient sales of their products in markets where   such sales are permitted under applicable laws based on approvals in other   markets, but there is no assurance that named patient sales of lomitapide   will continue at current levels, or at all, or that they will be able to   achieve significant levels of named patient sales of metreleptin in any   country, or at all. 101 

    

 

There is no   assurance that the Debtors or their licensees will be able to obtain   marketing authorizations for either product in additional countries. To   obtain such marketing approvals, the Debtors or their licensees must   establish, and comply with, numerous and varying regulatory requirements of   other countries regarding safety and efficacy and governing, among other   things, clinical trials, pricing, promotion and distribution of the   respective product. Approval procedures vary among countries, and can involve   additional product testing and additional administrative review periods.   Marketing approval in one country does not ensure such approval in another.   Regulatory authorities in countries where the Debtors seek approval for   lomitapide or metreleptin may not be satisfied with the design, size,   end-point or efficacy and safety results of the pivotal trial of the product,   or the risk/benefit profile of the product, and may reject their applications   for approval. (k) The Debtors Face Extensive Post-Marketing Regulatory   Requirements, and May Still Face Future Development and Regulatory   Difficulties. Even after marketing approval, a regulatory authority may still   impose significant restrictions on a product’s indications, conditions for   use, distribution or marketing or impose ongoing requirements for   post-marketing surveillance, risk management programs, post-approval studies   or clinical trials. The approvals of lomitapide and metreleptin in the U.S.   and EU have extensive post-marketing commitments, including post-marketing   commitments and studies, and risk management programs. For example, JUXTAPID   and MYALEPT are available in the U.S. only through the JUXTAPID REMS program   and MYALEPT REMS program, respectively, and the JUXTAPID REMS program is   subject to the FDA Consent Decree described in Section 3.4 above. Through   these programs, the Debtors must certify all healthcare providers who   prescribe JUXTAPID and the pharmacies that dispense the medicine, and for the   JUXTAPID REMS program, HoFH patients must attest as to their understanding of   the program prior to going on therapy. The FDA also requires that the   effectiveness of the REMS programs are assessed by the Debtors on a periodic   basis. The FDA itself assesses on a periodic basis whether a REMS program is   meeting its goals and whether the goals or elements of the plan should be   modified. Regulatory authorities have significant post-marketing authority,   including, for example, the authority to require labeling changes based on   new safety information, and to require post-marketing studies or clinical   trials to evaluate serious safety risks related to the use of a drug or   biologic. In addition, as noted above, the Debtors are required to implement   a variety of post-marketing registries and studies as part of the approvals   of metreleptin and lomitapide in the U.S. and EU. The failure to complete   and/or implement these registries and studies could result in the withdrawal   of the applicable approval or alterations to the approval which would likely   make commercialization of the products more limited. The Debtors expect that   the regulatory authorities in certain other countries outside the U.S. and EU   where their products are, or may be, approved may impose post-approval   obligations, including patient registries and risk management programs, and   requirements that may in some countries be more onerous than those imposed by   the FDA and EMA. Depending on the nature of these post-marketing studies, the   Debtors may be required to provide their products free of charge to   participants in the studies in certain countries even if they 102 

    

 

have pricing   and reimbursement approval in such countries, which would negatively impact   their level of revenues. The Debtors will also be subject to other ongoing   regulatory requirements in each of the countries in which their products are   approved governing the labeling, packaging, storage, advertising,   distribution, promotion, recordkeeping and submission of safety and other   post-marketing information, including adverse reactions, and any changes to   the approved product, product labeling, or manufacturing process. In   addition, manufacturers of drug products and their facilities are subject to   continual review and periodic inspections by the FDA, the EMA, the competent   authorities of the EU Member States and other regulatory authorities for   compliance with cGMP, and other regulations. The failure of the Debtors, or   third parties who perform services on behalf of or for the Debtors, to comply   with any of the legal or regulatory requirements set forth in this risk   factor could have a material adverse effect on the Debtors’ results of   operations and financial condition, could result in product approvals being   suspended, withdrawn, delayed or denied, could result in litigation and/or   investigations which could be costly and a significant distraction to   executive management and other employees. (l) The Debtors Rely on Third   Parties to Manufacture and Supply Their Products, Conduct Clinical and Other   Studies, and Other Critical Aspects of Their Business. As stated herein, the   Debtors and their foreign non-Debtor subsidiaries rely on third parties to   carry out critical aspects of their business, including commercialization,   manufacturing, supply chain, clinical development, distribution, drug safety   reporting and compliance, REMS and risk management programs, compliance, and   other key areas. The failure of these third parties to perform or comply with   applicable laws, regulations or contract terms could result in the   suspension, withdrawal, amendment, delay or denial of a regulatory approval,   and/or civil or criminal monetary penalties, any of which could have a   material adverse effect on the Debtors’ business, results of operations and   financial condition. In particular, the Debtors and their non-Debtor   subsidiaries depend entirely on sole source third party manufacturers to   produce the drug/active substance for their products and also the drug product   (e.g., final packaged form, vials, packaging, capsules, etc.). The failure of   these third party contractors to perform under their agreements or any   shortages in the materials necessary to delivery these services, even   temporarily, could result in product shortages and have a material adverse   effect on the Debtors’ business, operations and financial condition. In   addition, if the Debtors, or their drug substance or drug product   manufacturers or the manufacturing facilities for their drug substance or drug   product, fail to comply with applicable regulatory requirements, a regulatory   agency may suspend, withdraw or alter the conditions of their marketing   approval, seek to impose civil or criminal penalties or monetary fines, or   refuse pending approval applications submitted by the Debtors. Another key   example of where the Debtors and their non-Debtor subsidiaries use   contractors is in the area of clinical trials, registries and post-marketing   requirements, all of which are critical aspects of the Debtors’ business. The   failure of any of the third parties who perform these services on behalf of   or for the Debtors or their non-Debtor subsidiaries could have a number of   potential negative 103 

    

 

consequences,   including delays of clinical trials and the failure to meet critical   post-marketing requirements, which could have a material adverse effect on   the Debtors’ business, financial condition and results of operations. (m)   Product and Clinical Development Are Long, Expensive and Uncertain Processes,   and Require an Enormous Amount of Capital and Resources. Product development   in the pharmaceutical industry is a long, expensive and uncertain process,   and the Debtors do not have sufficient capital to pursue many of their key   development programs. Failure or delays in the commencement of clinical   trials would delay, prevent or limit the Debtors’ ability to generate   revenues, could cause reputational harm and the loss of commercialization   opportunities — any of which could have a material adverse effect on the   Debtors’ business, financial condition and results of operations. (n)   Potential product liability exposure of the Debtors. The use of any product   in clinical trials and the sale of any product for which the Debtors have or   obtain marketing approval expose them to the risk of product liability   claims. Product liability claims might be brought against them by consumers,   healthcare providers or others selling or otherwise coming into contact with   their product and product candidates. If they cannot successfully defend   themselves against product liability claims, they could incur substantial   liabilities. 11.5. Risks Associated with the Plan Investor’s Businesses. The   Plan Investor operates in the biopharmaceutical development sector and has a   number of drug candidates in various stages of clinical development. In   addition, the Plan Investor may continue to exploit other opportunities   within the sector in order to expand its present development pipeline. Industry   experience indicates that there may be a very high incidence of delay or   inability to produce valuable scientific results in relation to the present   development pipeline. In addition, the Plan Investor may not be successful in   developing new products based on the scientific discoveries developed by it.   The ability of the Plan Investor to develop new products relies on, among   other things, the recruitment of sufficiently qualified research and   development partners with expertise in the biopharmaceutical sector. The Plan   Investor may not be able to develop its relationships and/or recruit research   partners of a sufficient caliber to satisfy its growth rate and develop its   future pipeline. Additionally, product development timelines are at risk of   delay as the timing of regulatory approvals is uncertain and it is not always   possible to predict the rate of patient recruitment into clinical trials.   There is therefore a risk that product development could take longer than   presently expected by the Plan Investor. Furthermore, there can be no   guarantee that the Plan Investor will be able to, or that it will be   commercially advantageous for the Plan Investor to, develop its intellectual   property through entering into licensing deals with emerging, midsize and large   pharmaceutical companies. In addition, while the Debtors believe that the   Proposed Restructuring Transaction is in the best interests of the Debtors’   estates, there can be no certainty that the proposed combination of the   Debtors and the Plan Investor will achieve the significant synergies and cost   104 

    

 

savings that   the parties expect. In addition, as a result of the proposed sale, the Plan   Investor will need to retain and recruit key employees in order to maximize   synergies and integrate the two companies’ infrastructures, failure of which   could materially adversely affect the pro forma business, financial condition   and operating results. While the Plan is predicated on, among other things,   receipt of the Rights Offering Amount and the Plan Investor Equity Raise   Amount, both of which are fully backstopped by the Backstop Parties, there   can be no assurance that the Debtors will receive any or all of such amounts   (in addition to proceeds from any additional equity raises conducted by the   Plan Investor during the Chapter 11 Cases prior to the occurrence of the   Effective Date). (a) Risks related to Clinical Trials for the Plan Investor’s   products. To obtain the requisite regulatory approvals to market and sell any   of its product candidates, the Plan Investor must demonstrate, through   extensive preclinical studies and clinical trials, that its product   candidates are safe and effective in humans. Clinical testing is expensive   and can take many years to complete and its outcome is inherently uncertain.   Failure can occur at any time during the clinical trial process and   regulatory authorities may require further studies at additional cost.   Furthermore, regulatory authorities such as the FDA and European Medicines   Agency may not agree on the same trial design for pivotal studies. The   results of preclinical studies and earlier clinical trials may not be   predictive of the results of later-stage clinical trials. For example, the   results generated to date in pre-clinical studies or Phase I or Phase II   clinical trials for the Plan Investor’s product candidates do not ensure that   later clinical trials will demonstrate similar results. Product candidates in   later stages of clinical trials may fail to show the desired safety and   efficacy traits despite having progressed through preclinical studies and   initial clinical trials. (b) Regulatory Risks of the Plan Investor. The Plan   Investor’s future success is dependent upon its ability to develop   successfully, obtain regulatory approval for and then successfully   commercialize one or more of its product candidates. There can be no   assurance that any of the Plan Investor’s development drug candidates will be   successful in clinical trials or receive regulatory approval. Applications   for any of the Plan Investor’s product candidates could fail to receive   regulatory approval for many reasons. Any of the Plan Investor’s current or   future product candidates could take a significantly longer time to gain   regulatory approval than expected or may never gain regulatory approval. This   could delay or eliminate any potential product revenue by delaying or   eliminating the potential commercialization of the Plan Investor’s product   candidates. The Plan Investor intends to seek regulatory approvals to   commercialize its product candidates in Europe and the United States. To   obtain regulatory approval in other countries, the Plan Investor must comply   with numerous and varying regulatory requirements of such other   jurisdictions, which may include (without limitation) safety, efficacy,   chemistry, manufacturing and controls, clinical trials, commercial sales,   pricing and distribution of its product candidates. Even if the Plan Investor   is successful in obtaining approval in one jurisdiction, there can be no   guarantee that it will obtain approval in other jurisdictions. Failure to   obtain marketing authorizations for its product candidates will result in the   Plan Investor being unable to market and sell such products. If the Plan   Investor fails to obtain approval in any 105 

    

 

jurisdiction,   the geographical market for its product candidates could be limited.   Similarly, regulatory agencies may not approve the labelling claims that are   necessary or desirable for the successful commercialization of the Plan Investor’s   product candidates. (c) AIM and Shareholder Approval. As set forth above, the   issuance of the New Common Stock requires the approval of the U.K. Panel on   Takeovers and Mergers. Further, the formation of New Amryt will be effected   pursuant to a scheme of arrangement that requires the approval of both the   (a) shareholders of the Plan Investor (with a voting threshold of 75% of   those voting and a majority in number of those voting) and (b) courts of   England and Wales. The scheme of arrangement will be undertaken pursuant to   Part 26 of the Companies Act 2006 and will involve an application by the Plan   Investor to the High Court of Justice in England and Wales to sanction the   scheme of arrangement to allow New Amryt to become the holding company of the   Plan Investor group, following which the rights and obligations of the Plan   Investor under the Plan Funding Agreement will be assumed by New Amryt. In   consideration for the cancellation of each Plan Investor shareholder’s   interest in the Plan Investor, each Plan Investor shareholder will receive   shares in New Amryt and certain contingent value rights. The New Common Stock   is anticipated to be listed for trading on AIM and Euronext and will require   the approval of AIM and Euronext for such admission and trading. Moreover,   the issuance of the New Common Stock is subject to confirmation of the Plan.   (d) Market Acceptance of the Plan Investor’s Products. Even if the EMA, FDA   or any other comparable regulatory agency approves the marketing of any   product candidates that the Plan Investor develops and/or in the case of   existing marketed products, physicians, healthcare providers, patients or the   medical community may not accept or use them. Efforts to educate the medical   community and third party payers on the benefits of the Plan Investor’s   product candidates may require significant resources and may not be   successful. If any product candidate that the Plan Investor develops, in each   case if approved, do not achieve an adequate level of acceptance, the Plan   Investor may not generate significant product revenues or any profits from   operations. In addition, the potential market opportunity for the product   candidates that the Plan Investor may develop is difficult to estimate   precisely, particularly given that the orphan drug markets which the Plan   Investor is targeting are, by their nature, relatively small and unknown. The   Plan Investor’s estimates of the potential market opportunity for each of   these product candidates are predicated on several key assumptions, such as   industry knowledge and publications, third party research reports and other   surveys. If any of the assumptions proves to be inaccurate, then the actual   market for Lojuxta, AP101 or the Plan Investor’s other product candidates   from time to time, could be smaller than the Plan Investor estimates of the   potential market opportunity. If that turns out to be the case, the Plan   Investor’s product revenue may be limited and it may be unable to achieve or   maintain profitability. For additional risks associated with the Plan   Investor’s business, please reference the Amyrt Pharma Plc Annual Report at   https://www.amrytpharma.com/wp-content/uploads/2018/06/Amyrt-Annual-Report-2017_FINAL_v22_single_lowres.pdf.   106 

    

 

ARTICLE XII.   RIGHTS OFFERING PROCEDURES31 12.1. Overview of Rights Offering. In connection   with the transactions contemplated by the Plan, Eligible Holders of Claims in   Classes 4 and 6B will have the opportunity to participate in the Rights   Offering whereby such holders will have the right to purchase shares of New   Common Stock at a 20% discount of the implied value of each share. The Plan   contemplates an equity raise of $60 million — $42 million on account of the   Rights Offering to be conducted in these Chapter 11 Cases and $18 million on   account of a separate equity raise conducted by the Plan Investor (to be   issued to existing shareholders of the Plan Investor) for shares of New   Common Stock in the Plan Investor — all of which will be backstopped by the Backstop   Parties. Although the Debtors will offer all Eligible Holders in Class 4 and   6B the opportunity to participate in the Rights Offering, the Debtors may be   unable to obtain sufficient commitments from such holders to purchase the   full amount of the Rights Offering Stock. To guard against this possibility,   the Bridge Lenders have agreed, pursuant to the Backstop Commitment   Agreement, to backstop the Rights Offering (as well as the Plan Investor   Equity Raise) and to purchase any of the Rights Offering Stock that are not   subscribed for by such Eligible Holders. In addition, each Eligible Holder   will also have the right to elect to purchase additional shares of Rights   Offering Stock that (a) are not timely, duly and validly subscribed and paid   for by the Eligible Holders that timely vote to accept the Plan in accordance   with the Rights Offering Procedures, and (b) also are not timely, duly and   validly subscribed and paid for by Plan Investor Shareholders identified by   the Plan Investor (provided that the Plan Investor shall only have the right   to identify such Plan Investor Shareholders if the Plan Investor has fully   sold the $18 million Plan Investor Equity Raise by the Subscription   Expiration Deadline). The Rights Offering will expire on [August 15, 2019] at   4:00 p.m. (prevailing Eastern time) (the “Subscription Expiration Deadline”).   The Debtors have designated Prime Clerk as the “Subscription Agent” for the   Rights Offering. 31 Capitalized terms used in this Section not otherwise   defined herein or in the Plan shall have the meanings given to them in the   Rights Offering Procedures. In addition, this Section is only intended to   provide a summary of the Rights Offering Procedures. To the extent of any   inconsistency between this summary and the Rights Offering Procedures, the   Rights Offering Procedures shall govern. A copy of the Rights Offering   Procedures, and corresponding subscription form, are annexed hereto as   Exhibit 4 107 

    

 

12.2. The   Rights Offering Procedures. The Rights Offering Procedures, and corresponding   subscription form, set forth the specific requirements and procedures   pursuant to which the Rights Offering will be conducted. Generally, the   Rights Offering Procedures provide, among other things, that: 1. To   facilitate the exercise of the Subscription Rights, beginning on the   Subscription Commencement Date, the Debtors will send a Subscription Form to   each Eligible Holder, or its nominee, together with appropriate instructions   for completion, execution and timely delivery of the Subscription Form and   the payment of the purchase price for the Rights Offering Stock. 2. In order   to validly exercise the Subscription Rights, on or prior to [August 15, 2019]   at 4:00 p.m., or any earlier date provided by a holder’s Nominee, each   Eligible Holder must: a. return a duly completed and executed “Beneficial   Holder Subscription Form” to the Subscription Agent, or its Nominee; b.   return the IRS Form W-9 or IRS Form W-8, as applicable, to the Subscription   Agent, or its Nominee; and c. pay, or arrange for the payment of, the   applicable Purchase Price to the Subscription Agent by wire transfer ONLY of   immediately available funds in accordance with the instructions included in   Item 3 of the Beneficial Holder Subscription Form, on or before the   Subscription Expiration Deadline. 3. Instructions for completing the   Beneficial Holder Subscription Form are included in the Rights Offering   Procedures. 4. Cash remitted to the Subscription Agent as the Purchase Price   in accordance with the Rights Offering will be deposited and held by the   Subscription Agent in a segregated escrow account until administered in   connection with the settlement of the Rights Offering on the Effective Date.   The Subscription Agent may not use such funds for any other purpose prior to   such Effective Date and may not encumber or permit such funds to be   encumbered with any lien or similar encumbrance. Such funds held by the   Subscription Agent shall not be deemed part of the Debtors’ bankruptcy estate   or property of the Plan Investor. 5. If the Rights Offering is not   consummated, any cash paid to the Subscription Agent will be returned,   without interest, to the Eligible Holders as soon as reasonably practicable   after the date on which the Rights Offering is terminated. 12.3. Backstop   Commitment. As required pursuant to the terms of the RSA, the Plan Investor   and the Backstop Parties intend to enter into the Backstop Commitment   Agreement prior to the Disclosure Statement Hearing. Pursuant to the Backstop   Commitment Agreement, a copy of which will be 108 

    

 

filed with the   Bankruptcy Court as part of the Plan Supplement, the Backstop Parties agreed   to purchase any Unsubscribed Shares from the Rights Offering and the Plan   Investor Equity Raise for a fee equal to $3 million — i.e., 5% of the $60   million raised under the Rights Offering and the Plan Investor Equity Raise.   The Backstop Commitment Fee is earned immediately upon the Subscription   Commencement Date and is payable by the Plan Investor on the Effective Date   as set forth in, and subject to the terms and conditions of, the Backstop   Commitment Agreement. ARTICLE XIII. CERTAIN UNITED STATES FEDERAL INCOME TAX   CONSEQUENCES OF THE PLAN 13.1. Introduction. The following discussion   summarizes certain U.S. federal income tax consequences expected to result   from the consummation of the Plan. This discussion is only for general   information purposes and only describes the expected federal income tax   consequences to certain U.S. Holders and Non-U.S. Holders (each as defined   below) entitled to vote on the Plan. It is not a complete analysis of all   potential federal income tax consequences and does not address any tax   consequences arising under any state, local or foreign tax laws or federal   estate or gift tax laws, and does not address the Medicare tax on net   investment income. This discussion is based on the Internal Revenue Code of   1986, as amended (“IRC”), Treasury Regulations promulgated thereunder,   judicial decisions, and published rulings and administrative pronouncements   of the IRS, all as in effect on the date of this Disclosure Statement. These   authorities may change, possibly retroactively, resulting in federal income   tax consequences different from those discussed below. No ruling has been or   will be sought from the IRS, and no legal opinion of counsel will be   rendered, with respect to the matters discussed below. There can be no   assurance that the IRS will not take a contrary position regarding the   federal income tax consequences resulting from the consummation of the Plan   or that any contrary position would not be sustained by a court. As used in   this summary, a “U.S. Holder” means any beneficial owner of a Claim, New   Common Stock or Interest (as the case may be) that is, for U.S. federal   income tax purposes: (i) a U.S. citizen or a resident alien for U.S. federal   income tax purposes, (ii) a corporation (or other entity taxable as a   corporation for U.S. federal income tax purposes) created or organized under   the laws of the United States, any State thereof or the District of Columbia,   (iii) an estate the income of which is subject to U.S. federal income   taxation regardless of its source, or (iv) a trust which (a) is subject to   the primary supervision of a court within the United States and for which one   or more U.S. persons have authority to control all substantial decisions, or   (b) has a valid election in effect under applicable Treasury Regulations to   be treated as a U.S. person. This discussion assumes that U.S. Holders have   held their Claims and will hold any property received for such Claims as   “capital assets” within the meaning of IRC Section 1221 (generally, property   held for investment). In addition, this discussion assumes that the Debtors’   obligations under the Claims will be treated as debt for federal income tax   purposes. 109 

    

 

This discussion   does not address all federal income tax considerations that may be relevant   to a particular holder in light of that holder’s particular circumstances or   to holders subject to special rules under the federal income tax laws, such   as financial institutions, insurance companies, brokers, dealers or traders   in securities, commodities or currencies, tax-exempt organizations,   tax-qualified retirement plans, 10% U.S. Holders (as defined below), holders   subject to the alternative minimum tax, holders required under IRC Section   451(b) to conform the timing of income accruals with respect to the notes to   their financial statements, holders holding Claims as part of a hedge,   straddle or other risk reduction strategy or as part of a conversion   transaction or other integrated investment, holders who have a functional   currency other than the U.S. dollar and holders that acquired the Claims in   connection with the performance of services. As used in this summary, a   “Non-U.S. Holder” means a holder of a Claim, New Common Stock or Interest (as   the case may be), other than an entity or arrangement classified as a   partnership for U.S. federal income tax purposes, that is not a U.S. Holder.   This summary does not address all aspects of U.S. federal income taxes that   may be relevant to Non-U.S. Holders in light of their personal circumstances,   and does not deal with federal taxes (other than the federal income tax) or   with non-U.S., state, local or other tax considerations. Special rules, not   discussed here, may apply to certain Non-U.S. Holders, including U.S.   expatriates, controlled foreign corporations, passive foreign investment   companies and corporations that accumulate earnings to avoid U.S. federal   income tax. Non-U.S. Holders should consult their own tax advisors to   determine the U.S. federal, state, local and other tax consequences that may   be relevant to them. In the case of a holder that is classified as a   partnership for U.S. federal income tax purposes, the tax treatment of a   partner generally will depend upon the status of the partner and the   activities of the partnership. If you are a partner of a partnership that   holds a Claim, New Common Stock or Interest, then you should consult your own   tax advisors. In addition, this discussion does not address the treatment of   any fees to be paid pursuant to the Plan. New Warrants. The New Warrants and   the New Common Stock have substantially identical economic rights and the New   Warrants are exercisable into New Common Stock for nominal consideration.   Accordingly, the New Warrants should be treated as New Common Stock for   federal income tax purposes, this tax disclosure assumes such treatment and   references to “New Common Stock” include the New Warrants. U.S. HOLDERS AND   NON-U.S. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS REGARDING THE U.S. FEDERAL   INCOME TAX CONSEQUENCES TO THEM OF THE CONSUMMATION OF THE PLAN AS WELL AS   ANY TAX CONSEQUENCES ARISING UNDER ANY STATE, LOCAL OR FOREIGN TAX LAWS, OR   ANY OTHER FEDERAL TAX LAWS. 13.2. Federal Income Tax Consequences to the   Debtors. (a) Cancellation of Indebtedness and Reduction of Tax Attributes.   110 

    

 

The Debtors   generally should realize cancellation of indebtedness income (“COD Income”)   to the extent the sum of (i) the fair market value of any property received   by holders is less than (ii) the sum of (x) the adjusted issue price of any   debt exchanged pursuant to the Plan, and (y) the amount of any unpaid accrued   interest on such debt to the extent previously deducted by the Debtors. COD   Income realized by a Debtor will be excluded from income if the discharge of   debt occurs in a case brought under the Bankruptcy Code, the debtor is under   the court’s jurisdiction in such case and the discharge is granted by the   court or is pursuant to a chapter 11 plan approved by the court (the   “Bankruptcy Exception”). Because the Bankruptcy Exception will apply to the   transactions consummated pursuant to the Plan, the Debtors will not be   required to recognize any COD Income realized as a result of the   implementation of the Plan. A debtor that does not recognize COD Income under   the Bankruptcy Exception generally must reduce certain tax attributes by the   amount of the excluded COD Income. Attributes subject to reduction include   net operating losses (“NOLs”), NOL carryforwards and certain other losses,   credits and carryforwards, and the debtor’s tax basis in its assets   (including stock of subsidiaries). NOLs for the taxable year of the discharge   and NOL carryovers to such year generally are the first attributes subject to   reduction. However, a debtor may elect under IRC Section 108(b)(5) (the   “Section 108(b)(5) Election”) to reduce its basis in its depreciable property   first. If the debtor is a member of a consolidated group, the debtor may   treat stock in another group member as depreciable property for purposes of   the Section 108(b)(5) Election, provided the lower-tier member consents to a   corresponding reduction in its basis in its depreciable property. If a debtor   makes a Section 108(b)(5) Election, the limitation on reducing the debtor’s   basis in its assets below the amount of its remaining liabilities, discussed   below, does not apply. The Debtors currently do not intend to make a Section   108(b)(5) Election and expect to have sufficient NOLs to absorb any necessary   attribute reduction. The Debtors believe that, for federal income tax   purposes, the Debtors’ consolidated group had substantial consolidated NOL   and NOL carryforwards as of the Petition Date. Although the amount of the   Debtors’ NOLs will not be determined until the Debtors prepare their   consolidated federal income tax returns for 2018 and the portion of 2019   ending on the consummation of the Plan , the Debtors currently anticipate   that, although it is expected that NOL carryforwards will remain after   consummation of the plan, the value of the remaining NOL carryforwards will   be significantly reduced after application of the attribute reduction rules   and certain limitations under IRC Section 382 (described below). (b) Section   382 Limitation on NOLs. Under IRC Section 382, if a corporation or a   consolidated group with NOLs (a “Loss Corporation”) undergoes an “ownership   change,” the Loss Corporation’s use of its pre-change NOLs (and certain other   tax attributes) generally will be subject to an annual limitation in the   post-change period. In general, an “ownership change” occurs if the   percentage of the value of the Loss Corporation’s stock owned by one or more   direct or indirect “five percent shareholders” increases by more than fifty   percentage points over the lowest percentage of value owned by the five   percent shareholders at any time during the applicable testing period (an   “Ownership Change”). 111 

    

 

An exception to   the foregoing annual limitation rules generally applies when so-called   “qualified creditors” of a debtor corporation in chapter 11 receive, in   respect of their Claims, at least 50 percent of the vote and value of the   stock of the debtor corporation (or a controlling corporation if also in   chapter 11) as reorganized pursuant to a confirmed chapter 11 plan (the   “382(l)(5) Exception”). If the requirements of the 382(l)(5) Exception are   satisfied, a debtor’s pre-change NOLs (and certain other tax attributes)   would not be limited on an annual basis, but, instead, NOL carryforwards   would be reduced by the amount of any interest deductions claimed by the   debtor during the three taxable years preceding the effective date of the   plan of reorganization, and during the part of the taxable year prior to and   including the effective date of the plan of reorganization, in respect of all   debt converted into stock pursuant to the reorganization. If the 382(l)(5)   Exception applies and the Debtors undergo another “ownership change” within   two years after the Effective Date, then the Debtors’ pre-change NOLs (and   certain other tax attributes) thereafter would be effectively eliminated in   their entirety. The Debtors currently expect that the 382(l)(5) Exception   will not be available. Where the 382(l)(5) Exception is not applicable to a   corporation in bankruptcy (either because the debtor corporation does not   qualify for it or the debtor corporation otherwise elects not to utilize the   382(l)(5) Exception), another exception will generally apply (the “382(l)(6)   Exception”). Under the 382(l)(6) Exception, the annual limitation will be   calculated by reference to the lesser of (a) the value of the debtor   corporation’s new stock (with certain adjustments) immediately after the ownership   change or (b) the value of such debtor corporation’s assets (determined   without regard to liabilities) immediately before the ownership change. This   differs from the ordinary rule that requires the fair market value of a   debtor corporation that undergoes an “ownership change” to be determined   before the events giving rise to the change. The 382(l)(6) Exception also   differs from the 382(l)(5) Exception in that, under it, a debtor corporation   is not required to reduce its NOL carryforwards by the amount of interest   deductions claimed within the prior three-year period, and a debtor   corporation may undergo a change of ownership within two years without   automatically triggering the elimination of its pre-change NOLs (and certain   other tax attributes). The resulting limitation would be determined under the   regular rules for ownership changes. The Debtors expect the consummation of   the Plan will result in an Ownership Change of the Debtors’ consolidated   group. As a result of such Ownership Change and certain previous potential   Ownership Changes, it is expected that the application of IRC Section 382   will significantly reduce the value of any remaining NOL carryforwards. In   addition, the Debtors do not expect to have a material net unrealized   built-in loss on the Effective Date. If the Debtors have a net unrealized   built-in-loss, it could limit the Debtors’ ability to utilize certain   deductions after the Ownership Change. 13.3. Federal Income Tax Consequences   to the Plan Investor. (a) Potential Application of IRC 7874. A corporation is   generally considered a tax resident in the jurisdiction of its organization   or incorporation for U.S. federal income tax purposes. The Plan Investor is a   U.K. entity and would generally be classified as a foreign corporation (and, therefore,   not a U.S. tax resident) under these rules. Even so, the IRS may assert that   the Plan Investor should be treated 112 

    

 

as a U.S.   corporation (and, therefore, a U.S. tax resident) for U.S. federal income tax   purposes pursuant to IRC Section 7874. Under IRC Section 7874, if the former   stockholders of the Debtors hold 80% or more of the vote or value of the   shares of the Plan Investor by reason of holding the Debtors’ common stock   (the percentage (by vote and value) of the Plan Investor’s common shares   considered to be held (for purposes of IRC Section 7874) by former   stockholders of the Debtors immediately after consummation of the Plan by   reason of holding common stock of the Debtors, the “Section 7874   Percentage”), and the Plan Investor's expanded affiliated group after   consummation of the Plan does not have substantial business activities in the   U.K. relative to its worldwide business activities, the Plan Investor would   be treated as a U.S. corporation for U.S. federal income tax purposes. Under   Treasury Regulations, each creditor of a Debtor will be treated as a   shareholder of the Debtor and any claim of the creditor against the Debtor   will be treated as stock of the Debtor for purposes of determining the   Section 7874 Percentage. If the Section 7874 Percentage were determined to be   at least 60% (but less than 80%), IRC Section 7874 would cause the Plan   Investor to be treated as a “surrogate foreign corporation” if the Plan   Investor does not have substantial business activities in the U.K. relative   to its worldwide business activities. If the Plan Investor were to be treated   as a surrogate foreign corporation, several limitations could apply to the   Debtors including, but not limited to, (i) the prohibition of the Debtors’   use of NOLs, foreign tax credits, or other tax attributes to offset the   income or gain recognized by reason of the transfer of property to a foreign   related person during the 10-year period following the consummation of the   Plan or any income received or accrued during such period by reason of a   license of any property by the Debtors to a foreign related person and (ii)   the application of IRC Section 4985 and rules related thereto to impose an   excise tax on the value of certain stock compensation of the Debtors held   directly or indirectly by certain “disqualified individuals” (including   officers and directors of the Debtors) at a rate equal to 15%, but only if gain   is otherwise recognized by the Debtors’ shareholders as a result of the   consummation of the Plan. Under current law, the Debtors expect that the Plan   Investor will be treated as a surrogate foreign corporation for U.S. federal   income taxes but do not expect the Plan Investor to be treated as a U.S.   corporation for U.S. federal income tax purposes. However, determining the   Section 7874 Percentage is complex, subject to factual and legal   uncertainties and there can be no assurance that the IRS will agree with the   Debtors’ position with respect to the Section 7874 Percentage. Holders are   urged to consult their own tax advisors regarding the potential application   of IRC Section 7874 and its potential tax consequences. 13.4. Federal Income   Tax Consequences to Holders of Certain Claims. (a) Exchange of Certain Claims   for New Common Stock. If the exchange of certain Claims for New Common Stock   is treated as an exchange separate from the exchange of certain claims for   New Convertible Notes (discussed below), the receipt of New Common Stock by a   U.S. Holder in exchange for its Claims generally will be a taxable   transaction for U.S. federal income tax purposes. A U.S. Holder generally   will recognize gain or loss in an amount equal to the difference between (i)   the fair market value on the Effective Date of the New Common Stock received   in exchange for its Claims and (ii) the 113 

    

 

U.S. Holder’s   adjusted tax basis in its Claims. A U.S. Holder’s adjusted tax basis in its   Claims generally will equal (a) such U.S. Holder’s cost for its Claims, (b)   increased by any market discount (as discussed below) previously included in   gross income by the U.S. Holder with respect to its Claims and (c) decreased   (but not below zero) by any bond premium previously amortized by the U.S.   Holder with respect to its Claims. Except with respect to accrued interest   and to the extent that gain is recharacterized as ordinary income pursuant to   the market discount rules discussed below, such gain or loss generally will   be capital gain or loss and will be a long-term capital gain or loss if the   U.S. Holder’s holding period for its Claims exceeds one year at the time of   the exchange. Long-term capital gains recognized by non-corporate U.S.   Holders (including individuals) are currently eligible for reduced rates of   taxation. The deductibility of capital losses is subject to limitations. If,   instead, the exchange of certain Claims for New Common Stock is treated as a   part of a single exchange of Claims for New Common Stock and New Convertible   Notes, and such exchange is treated as part of a recapitalization   transaction, see the discussion below under Federal Income Tax Consequences   to U.S. Holders – Exchange of Certain Claims for New Convertible Notes (b)   Exchange of Certain Claims for New Convertible Notes. The U.S. federal income   tax consequences of the Plan may, to the extent certain Claims are exchanged   for New Convertible Notes depend in part upon: (i) whether such Claim is   based on an obligation that constitutes a “security” for U.S. federal income   tax purposes, and (ii) whether all or a portion of the consideration received   for such Claim is an obligation that constitutes a “security” for U.S.   federal income tax purposes. The term “security” is not defined in the IRC or   in the Treasury Regulations issued thereunder and has not been clearly   defined by judicial decisions. The determination of whether a particular debt   obligation constitutes a “security” depends on an overall evaluation of the   nature of the debt, including whether the holder of such debt obligation is   subject to a material level of entrepreneurial risk and whether a continuing   proprietary interest is intended or not. One of the most significant factors   considered in determining whether a particular debt obligation is a security   is its original term. In general, debt obligations issued with a   weighted-average maturity at issuance of less than five (5) years do not   constitute securities, whereas debt obligations with a weighted-average   maturity at issuance of ten (10) years or more constitute securities. In   addition, a right to acquire stock and, presumably, a right to acquire a   “security” generally can also be treated as a “security.” The New Convertible   Notes will have a maturity of five and a half (5.5) years and the Convertible   Notes, as related to the Convertible Notes Claim, have a maturity of five (5)   years. Accordingly, the New Convertible Notes and the Convertible Notes may   each constitute a “security.” However, the Roll Up Loan, as related to the   Roll Up Loan Claim, has a maturity of less than one (1) year and thus may not   be treated as a “security.” In the event that the New Convertible Notes and   the obligations underlying a U.S. Holder’s Claim each constitute a “security”   for U.S. federal income tax purposes, the U.S. Holder’s receipt of the New   Convertible Notes should be treated as a “recapitalization” for U.S. federal   income tax purposes. Accordingly, each such U.S. Holder generally will not   recognize any loss upon the exchange of its Claim, but will recognize gain   (computed as described in the next section), if any, to the extent of the   fair market value of any consideration received (including Shares of New   Common Stock and Subscription Rights (subject to the discussion below) to the   extent such shares and rights, as applicable, are treated as received with   such 114 

    

 

securities   pursuant to a single exchange) other than the securities as described in the   preceding paragraph. Thus, a U.S. Holder that has a gain would recognize such   gain to the extent of the fair market value of the New Common Stock and   Subscription Rights (subject to the discussion below) received. A U.S. Holder   will also have interest income to the extent of any consideration allocable   to accrued but unpaid interest not previously included in income, as   described below under “Federal Income Tax Consequences to U.S. Holders –   Other Considerations.” In a recapitalization exchange, a U.S. Holder’s tax   basis in the New Convertible Notes should equal such U.S. holder’s adjusted   tax basis in its Convertible Notes Claim, increased by any gain or interest   income recognized in the exchange, and decreased by the fair market value of   the taxable consideration received. In general, the U.S. Holder’s holding   period for such portion of the New Convertible Notes would include the U.S.   Holder’s holding period for its Convertible Notes Claim, except to the extent   that such New Convertible Notes were issued in respect of a Claim for accrued   but unpaid interest. Holders receiving New Convertible Notes are urged to   consult their own tax advisors regarding the appropriate status for U.S.   federal income tax purposes of their Claims and the potential tax   consequences thereof. (c) Exchange of New Money Bridge Loan Claims for New   Term Loan Facility Obligations. The U.S. federal income tax consequences of   the exchange of New Money Bridge Loan Claims for New Term Loan Facility   Obligations may in part be determined by whether each item exchanged   constitutes a “security” for U.S. federal income tax purposes, as discussed   above under “Federal Income Tax Consequences to U.S. Holders – Exchange of   Convertible Note Claims for New Convertible Notes.” The New Money Bridge   Loan, as related to the New Money Bridge Loan Claim, has a maturity of less   than one (1) year. It is therefore expected that the New Money Bridge Loan   will not constitute a “security” and the exchange of New Money Bridge Loan   Claims for New Term Loan Facility Obligations will not be treated as a   “recapitalization” for U.S. federal income tax purposes. Accordingly, such   exchange generally will be a taxable transaction for U.S. federal income tax   purposes., the results of which, subject to the discussion on “– Contingent   Payment Debt Instruments” and “– Original Issue Discount” below, are described   in further detail above under “Federal Income Tax Consequences to U.S.   Holders – Exchange of Certain Claims for New Common Stock.” (d) Satisfaction   of Claims for Cash. A U.S Holder of a Claim which is satisfied for cash in   connection with the Plan generally will recognize gain or loss equal to the   difference between (i) the amount of cash received by the U.S. Holder in   satisfaction of the Claim (excluding any cash received that is attributable   to accrued and unpaid interest) and (ii) the U.S. Holder’s adjusted tax basis   in the Claim. Subject to the market discount rules discussed below, any gain   or loss recognized on the satisfaction of a Claim for cash in connection with   the Plan generally will be capital gain or loss and will be long-term capital   gain or loss if, at the time of the exchange, the U.S. Holder’s holding   period is more than one year. The deductibility of capital losses is subject   to limitations. 115 

    

 

(e) Rights   Offering. Although it is not free from doubt, the Subscription Rights and   their subsequent exercise may be characterized as the exercise of options to   acquire New Common Stock for U.S. federal income tax purposes. The discussion   herein assumes that the Subscription Rights are respected as options to   acquire New Common Stock. It is uncertain whether a Subscription Right will   be considered to have value upon receipt by a U.S. Holder. If the IRS   attributed value to such Subscription Right, a U.S. Holder may have a taxable   event upon receipt of such Subscription Right, and would recognize gain or   loss to the extent described in “Federal Income Tax Consequences to U.S.   Holders – Exchange of Certain Claims for New Common Stock” and “Federal   Income Tax Consequences to U.S. Holders – Exchange of Certain Claims for New   Convertible Notes,” as applicable. U.S Holders receiving Subscriptions Rights   should consult their tax advisors regarding potential taxation relating to   the receipt of Subscription Rights. A U.S. Holder of Subscription Rights   generally would not recognize any gain or loss upon the exercise of such   Subscription Rights. A U.S. Holder’s aggregate tax basis in the New Common   Stock received upon exercise of a Subscription Right should be equal to the   sum of (i) the amount paid upon exercise of the Subscription Rights and (ii)   the holder’s tax basis in the Subscription Rights. A U.S. Holder’s holding   period in the New Common Stock received upon exercise of a Subscription Right   generally should commence the day following the exercise of the right. It is   uncertain whether a U.S. Holder that receives but does not exercise a   Subscription Right should be treated as receiving anything of additional   value in respect of its Claim. If the U.S. Holder is treated as having   received a Subscription Right of value (despite its subsequent lapse), such   that it obtains a tax basis in the right, the U.S. Holder generally would   recognize a loss to the extent of the U.S. Holder’s tax basis in the   Subscription Right. In general, such loss would be a capital loss, long-term   or short-term, depending upon whether the requisite holding period was   satisfied (which in the case of a recapitalization exchange, even if the   right goes unexercised, should include the holding period of the First Lien   Debt Secured Claim exchanged therefor). (f) Certain Consequences of Ownership   of New Common Stock The following is a discussion of certain U.S. federal   income tax consequences that may be relevant with respect to the ownership   and disposition of New Common Stock. This discussion addresses only the U.S.   federal income tax considerations of holders that will receive New Common   Stock under the Plan and that will hold such New Common Stock as a capital   asset. This discussion assumes that the Plan Investor will be treated as a   foreign corporation for all U.S. federal income tax purposes. Distributions   on New Common Stock. Subject to the discussion of PFIC and CFC rules   discussed below, any distributions made by the Plan Investor with respect to   the New Common Stock will generally constitute taxable dividends to U.S. Holders   to the extent of the Plan Investor’s current or accumulated earnings and   profits, as determined under U.S. federal 116 

    

 

income tax   principles. Distributions in excess of those earnings and profits will be   treated first as a nontaxable return of capital to the extent of the U.S.   Holder’s tax basis in its New Common Stock, and thereafter as capital gain.   Dividends may be eligible for a reduced rate of U.S. income tax for   individual U.S. Holders, although such treatment is not free from doubt.   Because the Plan Investor is not a U.S. corporation, holders that are   corporations and are not 10% U.S. Holders will generally not be entitled to   claim a dividends-received deduction with respect to distributions they   receive from the Plan Investor. Distributions taxable as dividends generally   will be treated as foreign source “passive category income” for United States   foreign tax credit purposes. Sale or Exchange of New Common Stock. Subject to   the discussion of PFIC and CFC rules discussed below, gain or loss recognized   on a sale, exchange, or other taxable disposition of New Common Stock will   generally equal the difference, if any, between the amount realized and the   holder’s adjusted tax basis in the New Common Stock at the time of such sale,   exchange, or other taxable disposition. Assuming such New Common Stock is   held as a capital asset, any such gain or loss will be long-term capital gain   or loss if the holding period for the New Common Stock exchanged is more than   one year at that time. The deductibility of capital losses is subject to   limitations. Passive Foreign Investment Company Status. The Plan Investor   will be a passive foreign investment company for U.S. federal income tax   purposes (a “PFIC”) if either (i) 75% or more of its gross income in a   taxable year consists of “passive income” (generally including dividends,   interest, gains from the sale, or exchange of investment property) or (ii) at   least 50% of its assets in a taxable year (averaged over the year and   generally determined based upon either value or tax basis depending on the   application of certain tests) produce or are held for the production of   passive income. For purposes of determining whether the Plan Investor will be   a PFIC, the Plan Investor will be treated as earning and owning a   proportionate share of the income and assets, respectively, of its   subsidiaries that have made U.S. tax elections to be disregarded as separate   entities as well as of any other corporate subsidiary in which it owns at   least 25% of the value of the subsidiary’s stock. For purposes of these   tests, income derived from the performance of services does not constitute   passive income. By contrast, royalties and rental income would generally   constitute passive income unless the Plan Investor were treated under   specific rules as deriving its royalties and rental income in the active   conduct of a trade or business. Based on the past and anticipated future   operations of the Plan Investor and the Debtors, the Debtors do not believe   that the Plan Investor has been a PFIC or that the Plan Investor will be a   PFIC with respect to future taxable years. However, no assurance can be given   that the IRS or a court of law will accept this position, and there is a risk   that the IRS or a court of law could determine that the Plan Investor is a   PFIC. Moreover, there can be no assurance that the Plan Investor will not   become a PFIC in any future taxable year because (i) there are uncertainties   in the application of the PFIC rules, (ii) the PFIC test is an annual test,   and (iii) although the Plan Investor intends to manage its business so as to   avoid PFIC status to the extent consistent with its other business goals, there   could be changes in the nature and extent of operations in future years.   Subject to the QEF Election (as defined herein) and mark-to-market election   discussions below, if the Plan Investor was to be treated as a PFIC for any   taxable year (and regardless of whether it remains a PFIC for subsequent   taxable years), (i) each U.S Holder who 117 

    

 

is treated as   owning New Common Stock during such taxable year for purposes of the PFIC   rules would be required to allocate any excess distributions received (i.e.,   the portion of any distributions received by the U.S Holder on New Common   Stock in a taxable year in excess of 125 percent of the average annual   distributions received by the U.S Holder in the three preceding taxable   years, or, if shorter, the U.S Holder’s holding period for the New Common   Stock) and any gain realized from the disposition of New Common Stock ratably   over the U.S Holder’s holding period of the New Common Stock; (ii) the amount   allocated to the current taxable year, and any taxable year prior to the   first taxable year in which the Plan Investor was a PFIC, would be treated as   ordinary income; and (iii) the amount allocated to each other taxable year   will be subject to tax at the highest tax rate in effect for that year and   the interest charge generally applicable to underpayments of tax will be   imposed on the resulting tax attributable to each such taxable year. A U.S   Holder who holds New Common Stock during a period when the Plan Investor is a   PFIC generally will be subject to the foregoing rules for that taxable year   and all subsequent taxable years with respect to that U.S Holder’s ownership   of New Common Stock, even if the Plan Investor ceased to be a PFIC, subject   to certain exceptions for holders of New Common Stock who make a QEF election   or mark-to-market election discussed below. U.S. Holders are urged to consult   their tax advisors regarding the PFIC rules, including as to the advisability   of choosing to make a QEF election or mark-to-market election. The above rules   relating to the taxation of excess distributions and dispositions will not   apply to a holder who has made a timely “qualified electing fund” (“QEF”)   election for all taxable years that the holder has held its New Common Stock   and the Plan Investor was a PFIC. Instead, each holder who has made a timely   QEF election is required, for each taxable year that the Plan Investor is a   PFIC, to include in income a pro rata share of the Plan Investor’s ordinary   earnings as ordinary income and a pro rata share of the Plan Investor’s net   capital gain as long-term capital gain, regardless of whether the Plan   Investor has made any distributions of the earnings or gain. The U.S.   Holder’s basis in its New Common Stock will be increased to reflect taxed but   undistributed income. Distributions of income that had been previously taxed   will result in a corresponding reduction in the basis of the New Common Stock   and will not be taxed again once distributed. A U.S. Holder making a QEF   election would generally recognize capital gain or loss on the sale, exchange   or other disposition of New Common Stock. If the Plan Investor determines   that it is a PFIC for any taxable year, it may provide each holder with all   necessary information in order to make the QEF election described above. If   the Plan Investor does not provide such information, then a QEF election   would not be available. As an alternative to the tax treatment discussed   above, a U.S. Holder of PFIC stock which is “marketable stock” (i.e.,   “regularly traded” on a national securities exchange which is registered with   the SEC or a national market system established under the 1934 Securities and   Exchange Act) may in certain circumstances elect to mark to market its PFIC   stock. As a result of such election, in any taxable year the Plan Investor is   a PFIC, a U.S. Holder would be required to recognize gain or loss to the   extent of the difference between the fair market value of the PFIC stock at   the end of the taxable year and such U.S. Holder’s basis in the PFIC stock.   Loss recognition as a result of such election is limited to the amount of   prior inclusions of income with respect to such PFIC stock. The availability   of the mark-to-market 118 

    

 

election to a   holder will be dependent on whether the New Common Stock is listed on a   qualified exchange and whether such stock is regularly traded. Controlled   Foreign Corporation Status. If more than 50% of the total value or total   combined voting power of all classes of the Plan Investor’s stock is owned,   directly, indirectly, or constructively by certain U.S. holders, each of whom   own, after applying attribution rules, either 10% or more of the total   combined voting power of all classes of the Plan Investor’s stock or 10% or   more of total value of the Plan Investor’s stock (each such holder, a “10%   U.S. Holder”), the Plan Investor (or certain non-U.S. subsidiaries of the   Plan Investor, as applicable) would be treated as a “controlled foreign   corporation” (“CFC”). This classification would result in the application of   many complex rules, including the required inclusion in income by 10% U.S.   Holders of their pro rata share of any “Subpart F income,” “global intangible   low-taxed income” and any investments in “U.S. property” (each as defined by   the IRC) of the Plan Investor. In addition, under Section 1248 of the IRC, if   the Plan Investor was a CFC at any time during the five-year period ending   with the sale or exchange of the Plan Investor’s stock by a 10% U.S. Holder,   gain from such sale or exchange would generally be treated as dividend income   to the extent of the Plan Investor’s earnings and profits attributable to the   shares sold or exchanged. If the Plan Investor was to become a CFC, the PFIC   rules discussed above would generally not apply with regard to any 10% U.S.   Holder. The Plan Investor intends to undertake certain corporate conversions   and make certain tax elections with respect to its subsidiaries prior to the   Effective Date. The effect of these actions would be that these subsidiaries   would be disregarded from the Plan Investor for U.S. federal income tax   purposes. If these steps are not or cannot be undertaken prior to the   Effective Date, each of these subsidiaries would be treated as a CFC,   regardless of whether the Plan Investor is a CFC, and 10% U.S. Holders may   need to include in income their pro rata share of any “Subpart F income,”   “global intangible low-taxed income” and any investments in “U.S. property”   (each as defined by the IRC) of these subsidiaries. Because of the complexity   of Subpart F, a more detailed review of these rules is beyond the scope of   this discussion and any holder that may become a 10% U.S. Holder should   consult its tax advisor. (g) Certain Consequences of Ownership of New   Convertible Notes and New Term Loan Facility Obligations. Subject to the   discussion below under “Certain Consequences of Ownership of New Convertible   Notes and New Term Loan Facility Obligations– Contingent Payment Debt   Instruments” and “– Original Issue Discount,” interest paid on New   Convertible Notes and New Term Loan Facility Obligations will be includible   in a U.S. Holder’s gross income as ordinary interest income in accordance   with the U.S. Holder’s usual method of tax accounting. Upon the sale,   exchange or retirement of New Convertible Notes or New Term Loan Facility   Obligations, a U.S. Holder generally will recognize taxable gain or loss   equal to the difference, if any, between the amount realized on the sale,   exchange or retirement, other than accrued but unpaid interest which will be   taxable as such, and such U.S. Holder’s adjusted tax basis in the relevant   New Convertible Note or New Term Loan Facility Obligation. Such gain 119 

    

 

or loss will be   capital gain or loss except to the extent that gain is treated as ordinary   income pursuant to the market discount rules discussed below. Contingent   Payment Debt Instruments. Under certain circumstances and at the Plan   Investor’s election, the Debtors may become obligated to make payments on the   New Term Loan Facility in excess of stated principal and interest. The   obligation to make these payments may implicate the provisions of the   Treasury Regulations relating to contingent payment debt instruments.   Treasury Regulations provide special rules for contingent payment debt   instruments which, if applicable, could cause the timing, amount and   character of a holder’s income, gain or loss with respect to the Notes to be   different from the consequences discussed herein. Although the issue is not   free from doubt, the Debtors intend to take the position that the possibility   of the payment of such additional amounts will not result in the New Term   Loan Facility being treated as a contingent payment debt instrument under the   applicable Treasury Regulations. The Debtors’ position is binding on a holder   subject to U.S. federal income taxation unless such holder discloses on its   tax return that such holder is taking a contrary position. This position is   not binding on the IRS, which may take a contrary position and treat the New   Term Loan Facility as a contingent payment debt instrument. The remainder of   this discussion assumes that the Notes are not treated as contingent payment   debt instruments. Holders should consult with their tax advisors about the   potential tax consequences if the New Term Loan Facility is determined to be   a contingent payment debt instrument. Original Issue Discount. The New Term   Loan Facility will be issued with original Issue Discount (“OID”) for U.S.   federal income tax purposes because a portion of the stated interest on the   New Term Loan Facility will not be unconditionally payable in cash at least   annually. The portion of the interest payments that will be unconditionally   payable in cash at least annually will be “qualified stated interest” for   U.S. federal income tax purposes and will be includible in a U.S. Holder’s   gross income as ordinary interest income as described above. The amount of   OID under the New Term Loan Facility will be equal to the excess of the sum   of all principal and interest payments provided by the New Term Loan Facility   (initially taking into account the payment schedule assumption that only cash   interest will be paid, as described below) over the “issue price” and the sum   of all payments treated as qualified stated interest in respect of the New   Term Loan Facility. The amount of OID that a U.S. Holder must include in   income will generally equal the sum of the “daily portions” of OID with   respect to the New Term Loan Facility for each day during the taxable year or   portion of the taxable year on which the U.S. Holder held such New Term Loan   Facility (“accrued OID”). The daily portion is determined by allocating to   each day in any “accrual period” a pro rata portion of the OID allocable to   that accrual period. The “accrual period” for the New Term Loan Facility may   be of any length and may vary in length over the term of the New Term Loan   Facility, provided that each accrual period is no longer than one year and   each scheduled payment of principal or interest occurs on the first day or   the final day of an accrual period. The amount of OID allocable to any   accrual period other than the final accrual period is an amount equal to the   product of the New Term Loan Facility’s adjusted issue price (“AIP”) at the   beginning of such accrual period and its yield to maturity (determined on the   basis of compounding at the close of each accrual period and properly   adjusted for the length of the accrual period) less amounts treated as   qualified stated interest for such period. The AIP of the New Term Loan   Facility at the beginning of any accrual period is 120 

    

 

equal to its   issue price increased by the accrued OID for each prior accrual period and   reduced by any cash payments made on such New Term Loan Facility on or before   the first day of the accrual period, other than payments of qualified stated   interest. A U.S. Holder’s basis in the New Term Loan Facility will also be   increased by the accrued OID for each prior accrual period and reduced by any   cash payments made on such New Term Loan Facility, other than payments of   qualified stated interest on or before the first day of the accrual period.   OID allocable to a final accrual period is the difference between the amount   payable at maturity other than a payment of qualified stated interest and the   AIP at the beginning of the final accrual period. Each payment made in cash   under the New Term Loan Facility, other than payments of qualified stated   interest, will be treated first as a payment of any accrued OID that has not   been allocated to prior payments and second as a payment of principal. A U.S.   Holder generally will not be required to include separately in income cash   payments received on the New Term Loan Facility to the extent such payments   constitute payments of previously accrued OID or payments of principal. The   yield to maturity of the New Term Loan Facility is the discount rate that   causes the present value of all principal and interest payments to be made   under the New Term Loan Facility to equal the issue price of such New Term   Loan Facility. For purposes of computing the yield to maturity of the New Term   Loan Facility, the Plan Investor and the Debtors expect to take the position   that the Debtors and each Holder are entitled to use a payment schedule in   which all of the interest on the New Term Loan Facility is initially assumed   to be paid only in cash. This assumption is made solely for U.S. federal   income tax purposes and does not constitute a representation regarding the   likelihood that interest on the New Term Loan Facility will be paid only in   cash. If, contrary to this assumption any portion of the interest is paid in   kind, then solely for the purposes of determining the amount of OID on the   New Term Loan Facility, the yield to maturity on the New Term Loan Facility   will be redetermined as described below. If, for any interest payment period,   any interest is paid in kind (“PIK interest”), a U.S. Holder’s OID   calculation for future periods will be adjusted by treating the New Term Loan   Facility as if it had been reissued for an amount equal to its AIP on the   date preceding the first date of such interest payment period, and   re-calculating the yield to maturity of the reissued New Term Loan Facility   by treating the amount of PIK interest (and of any prior PIK interest) as a   payment that will be made on the maturity date of such New Term Loan   Facility. Any PIK interest will not be treated as a payment of interest on an   original New Term Loan Facility for U.S. federal income tax purposes.   Instead, any PIK interest together with the original New Term Loan Facility   will be treated as a single New Term Loan Facility for U.S. federal income   tax purposes. The rules regarding OID are complex and the rules described   above may not apply in all cases. Accordingly, U.S. Holders should consult   their own tax advisors regarding their application. (h) Other Considerations.   Accrued Interest. There is general uncertainty regarding the extent to which   the receipt of cash or other property in exchange for a debt instrument   should be treated as attributable to unpaid accrued interest. In accordance   with the Plan, the Debtors take the position 121 

    

 

that property   distributed pursuant to the Plan will first be allocable to the principal   amount of a U.S. Holder’s Claim and then, to the extent necessary, to any   unpaid accrued interest thereon. The IRS, however, could take a contrary   position. To the extent any property received pursuant to the Plan is   considered attributable to unpaid accrued interest, a U.S. Holder will   recognize ordinary income to the extent the value of the property exceeds the   amount of unpaid accrued interest previously included in gross income by the   holder. A U.S. Holder’s tax basis in such property should be equal to the   amount of interest income treated as satisfied by the receipt of the   property, and its holding period in the property should begin on the day   after the Effective Date. A U.S. Holder generally will be entitled to   recognize a loss to the extent any accrued interest previously included in   its gross income is not paid in full. U.S. HOLDERS SHOULD CONSULT THEIR TAX   ADVISORS REGARDING THE EXTENT TO WHICH CONSIDERATION RECEIVED UNDER THE PLAN   SHOULD BE TREATED AS ATTRIBUTABLE TO UNPAID ACCRUED INTEREST. Market   Discount. A U.S. Holder of Claims acquired other than at original issuance   with a tax basis less than the amount payable at maturity with respect to   such Claims generally will be subject to the market discount rules of the IRC   (unless such difference is less than a prescribed de minimis amount). Under   the market discount rules, a U.S. Holder is required to treat any principal payment   on, or any gain recognized on the sale, exchange, retirement or other   disposition of, Claims as ordinary income to the extent of the accrued market   discount that has not previously been included in income at the time of such   payment or disposition pursuant to an election by the U.S. holder to include   market discount in income as it accrues. The election referred to in the   preceding sentence will apply, once made, to all market discount bonds   acquired by the U.S. Holder in the tax year during which the election is made   and all market discount bonds acquired by the U.S. Holder in all subsequent   years. Any market discount will be considered to accrue on a straight-line   basis during the period from the date of acquisition of the Claims to their   maturity date, unless the U.S. Holder irrevocably elects to compute the   accrual of market discount on a constant yield basis. Additional Tax on   Investment Income. Certain individuals, estates and trusts are required to   pay a 3.8% Medicare tax on “net investment income” including, among other   things, interest (including OID) and net gain from sales or other   dispositions in respect of securities, subject to certain exceptions. U.S.   Holders should consult their tax advisors regarding the effect, if any, of   this tax on their ownership and disposition of a Debtor’s securities. (i)   Information Reporting and Backup Withholding. The Debtors (or their paying   agent) may be obligated to furnish information to the IRS regarding the   consideration received by U.S. Holders (other than corporations and other   exempt holders) pursuant to the Plan. U.S. Holders may be subject to backup   withholding (currently, at a rate of 24%) on the consideration (including   OID) received pursuant to the Plan.Certain U.S. Holders (including   corporations) generally are not subject to backup withholding. A U.S. Holder   that is 122 

    

 

not otherwise   exempt generally may avoid backup withholding by furnishing to the Debtors   (or their paying agent) its taxpayer identification number and certifying,   under penalties of perjury, that the taxpayer identification number provided   is correct and that the U.S. Holder has not been notified by the IRS that it   is subject to backup withholding. Backup withholding is not an additional   tax. Taxpayers may use amounts withheld as a credit against their federal   income tax liability or may claim a refund of any excess amounts withheld by   timely filing an appropriate claim for refund with the IRS. 13.5. Federal   Income Tax Consequences to Non-U.S. Holders. (a) Consequences to Non-U.S.   Holders of the Plan. Subject to the rules discussed below under “Federal   Income Tax Consequences to Non-U.S. Holders – FATCA Withholding,” any gain   realized by a Non-U.S. Holder on the exchange of its Claim generally will be   exempt from U.S. federal income and withholding tax, provided that such   Non-U.S. Holder is not an individual who is present in the United States for   183 days or more in the taxable year of disposition or who is subject to   special rules applicable to former citizens and residents of the United   States. Any interest income (including OID) realized by a Non-U.S. Holder on   the exchange of its Claim generally will be exempt from U.S. federal income   or withholding tax, provided that: • such Non-U.S. Holder does not own, actually   or constructively, 10% or more of the total combined voting power of all   classes of the voting stock of a Debtor, is not a controlled foreign   corporation related, directly or indirectly, to a Debtor through stock   ownership, and is not a bank receiving interest described in IRC Section   881(c)(3)(A); • the statement requirement set forth in IRC Section 871(h) or   Section 881(c) has been fulfilled with respect to the beneficial owner, as   discussed below; and such Non-U.S. Holder is not an individual who is present   in the United States for 183 days or more in the taxable year of disposition   or who is subject to special rules applicable to former citizens and   residents of the United States. • The statement requirement referred to in   the second bullet point of the preceding paragraph generally will be   fulfilled if the beneficial owner of the cash received on the exchange   certifies on IRS Form W-8BEN or W-8BEN-E (or such successor form as the IRS   designates) under penalties of perjury that it is not a U.S. person and   provides its name and address. The Non-U.S. Holder must provide the form to   the Debtors or their Disbursing Agent, or in the case of a note held through   a securities clearing organization, bank or other financial institution   holding customers’ securities in the ordinary course of its trade or   business, to such organization, bank or other financial institution, which   must in turn provide to the Debtors or their Disbursing Agent a statement   that it has received the form and furnish a copy thereof; provided that a   non-U.S. financial institution will fulfill this requirement by filing IRS   Form W-8IMY if it has entered into an agreement with the IRS to be treated as   a qualified intermediary. These forms must be periodically updated. 123 

    

 

If a Non-U.S.   Holder is engaged in a trade or business in the United States, and if any   gain or interest income realized on the exchange of its Claim is effectively   connected with the conduct of such trade or business, the Non-U.S. Holder,   although exempt from the withholding tax discussed in the preceding   paragraphs, generally will be subject to regular U.S. federal income tax on   such gain or interest income (including OID) in the same manner as if it were   a U.S. Holder. In lieu of the certificate described in the preceding   paragraph, such a Non-U.S. Holder will be required to provide a properly   executed IRS Form W-8ECI (or such successor form as the IRS designates), in   the manner described above, in order to claim an exemption from withholding   tax. In addition, if such a Non-U.S. Holder is a corporation, it may be   subject to a branch profits tax equal to 30% (or such lower rate provided by   an applicable treaty) of its effectively connected earnings and profits for   the taxable year, subject to certain adjustments. (b) Consequences to   Non-U.S. Holders of the Plan. Subject to the rules discussed below under   “Federal Income Tax Consequences to Non-U.S. Holders – FATCA Withholding,”   any gain or interest income (including OID) realized by a Non-U.S. Holder on the   exchange of its Claim generally will be exempt from U.S. federal income or   withholding tax, provided that: such Non-U.S. Holder does not own, actually   or constructively, 10% or more of the total combined voting power of all   classes of the voting stock of a Debtor, is not a controlled foreign   corporation related, directly or indirectly, to a Debtor through stock   ownership, and is not a bank receiving interest described in IRC Section   881(c)(3)(A); the statement requirement set forth in IRC Section 871(h) or   IRC Section 881(c) has been fulfilled with respect to the beneficial owner,   as discussed below; and such Non-U.S. Holder is not an individual who is   present in the United States for 183 days or more in the taxable year of   disposition or who is subject to special rules applicable to former citizens   and residents of the United States. The statement requirement referred to in   the second bullet point of the preceding paragraph generally will be   fulfilled if the beneficial owner of the cash received on the exchange   certifies on IRS Form W-8BEN or W-8BEN-E (or such successor form as the IRS   designates) under penalties of perjury that it is not a U.S. person and   provides its name and address. The Non-U.S. Holder must provide the form to   the Debtors or their Disbursing Agent, or in the case of a note held through   a securities clearing organization, bank or other financial institution   holding customers’ securities in the ordinary course of its trade or   business, to such organization, bank or other financial institution, which   must in turn provide to the Debtors or their Disbursing Agent a statement   that it has received the form and furnish a copy thereof; provided that a   non-U.S. financial institution will fulfill this requirement by filing IRS   Form W-8IMY if it has entered into an agreement with the IRS to be treated as   a qualified intermediary. These forms must be periodically updated. If a   Non-U.S. Holder is engaged in a trade or business in the United States, and   if any gain or interest income realized on the exchange of its Claim is   effectively connected with 124 

    

 

the conduct of   such trade or business, the Non-U.S. Holder, although exempt from the   withholding tax discussed in the preceding paragraphs, generally will be   subject to regular U.S. federal income tax on such gain or interest income   (including OID) in the same manner as if it were a U.S. Holder. In lieu of   the certificate described in the preceding paragraph, such a Non-U.S. Holder   will be required to provide a properly executed IRS Form W-8ECI (or such   successor form as the IRS designates), in the manner described above, in   order to claim an exemption from withholding tax. In addition, if such a   Non-U.S. Holder is a corporation, it may be subject to a branch profits tax   equal to 30% (or such lower rate provided by an applicable treaty) of its   effectively connected earnings and profits for the taxable year, subject to   certain adjustments. (c) FATCA Withholding. Pursuant to IRC Sections 1471   through 1474, commonly known as the Foreign Account Tax Compliance Act   (“FATCA”), a 30% withholding tax (“FATCA withholding”) may be imposed on   certain payments to certain foreign financial institutions, investment funds   and other non-U.S. persons receiving payments on a holder’s behalf if the   holder or such persons fail to comply with certain information reporting   requirements. An intergovernmental agreement between the United States and an   applicable foreign country, or future Treasury Regulations, may modify this   regime. Payments of interest (including OID) that a holder receives in   respect of a Claim, as applicable, could be affected by this withholding if   such holder is subject to the FATCA information reporting requirements and   fails to comply with them or if such holder holds the Claim indirectly   through a non-U.S. person (e.g., a foreign bank or broker) that fails to comply   with these requirements (even if payments to a holder would not otherwise   have been subject to FATCA withholding). Non-U.S. Holders should consult   their own tax advisors regarding the relevant U.S. law and other official   guidance on FATCA withholding. THE FOREGOING DISCUSSION OF FEDERAL INCOME TAX   CONSIDERATIONS IS FOR GENERAL INFORMATION PURPOSES ONLY AND IS NOT TAX   ADVICE. EACH U.S. HOLDER SHOULD CONSULT ITS OWN TAX ADVISOR REGARDING THE   FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF THE PLAN DESCRIBED   HEREIN. ARTICLE XIV. CERTAIN UNITED KINGDOM INCOME TAX CONSEQUENCES OF THE   PLAN 14.1. Introduction The following discussion is intended to be a general   guide to certain U.K. tax consequences of holding New Common Stock, under   current law and the current practice of Her Majesty’s Revenue & Customs   (“HMRC”), either of which is subject to change at any time, possibly with   retrospective effect. Except where otherwise stated, this discussion applies   only to shareholders who are not (and have not recently been) resident or (in   the case of individuals) domiciled for tax purposes in the U.K., who hold   their New Common Stock as an investment and who are the 125 

    

 

absolute   beneficial owners of their New Common Stock. This discussion may not apply to   certain shareholders, such as dealers in securities, market makers, brokers,   life insurance companies, collective investment schemes, shareholders who are   exempt from tax and shareholders who have (or are deemed to have) acquired   their New Common Stock by virtue of an office or employment. Such   shareholders may be subject to special rules. The following statements do not   purport to be a comprehensive description of all U.K. tax considerations that   may be relevant to any particular shareholder. Any person who is in any doubt   as to their tax position should consult an appropriate professional tax   advisor. 14.2. Dividends The Plan Investor is not required to withhold tax at   source from dividends paid to the holders of the New Common Stock. 14.3. Capital   Gains U.K. tax is not normally charged on any capital gains realised by   non-U.K. shareholders in the Plan Investor unless, in the case of a corporate   shareholder, at or before the time the gain accrues, the holding of New   Common Stock is used in or for the purposes of a trade carried on by the   non-resident shareholder through a permanent establishment in the U.K. or for   the purposes of that permanent establishment. Similarly, an individual   shareholder who carries on a trade, profession or vocation in the U.K.   through a branch or agency may be liable for U.K. tax on the gain if such   shareholder disposes of shares that are, or have been, used, held or acquired   for the purposes of such trade, profession or vocation or for the purposes of   such branch or agency. 14.4. Inheritance Tax The New Common Stock are assets   situated in the United Kingdom for the purposes of U.K. inheritance tax. A   gift of New Common Stock by, or the death of, an individual shareholder may   (subject to certain exemptions and reliefs and the provisions of any   applicable capital taxes treaty) give rise to a liability to U.K. inheritance   tax even if the shareholder is neither domiciled nor deemed to be domiciled   in the United Kingdom. 14.5. Stamp Taxes No stamp duty or stamp duty reserve   tax (“SDRT”) should be payable in respect of the issue of the New Common   Stock. On the basis that the New Common Stock will be included in the   official list of the NASDAQ Global Select Market and that such market will   continue to have the status of a “recognised stock exchange” for U.K. stamp   taxes purposes, stamp duty or SDRT will be payable in respect of any future   conveyance, transfer or sale of, or agreement to transfer, New Common Stock   (including any transfer effected on a paperless basis through CREST) at the   rate of 0.5% of the amount or value of the consideration. The stamp tax will   generally be met by the new beneficial owner. 126 

    

 

ARTICLE XV.   SECURITIES LAW MATTERS 15.1. General. The Plan provides for the Plan Investor   to issue New Common Stock to holders of Class 4 Novelion Intercompany Loan   Claims and Class 6B Other General Unsecured Claims. The Plan also provides   for the offer and issuance of the Rights Offering Stock pursuant to the   Rights Offering to Eligible Holders of Claims in Class 4 and Class 6B. The   Debtors believe that the New Common Stock and the Subscription Rights   constitute “securities,” as defined in Section 2(a)(1) of the Securities Act,   section 101 of the Bankruptcy Code, and applicable state securities laws. No   registration statement will be filed under the Securities Act or any state   securities laws relating to the initial offer and distribution on the   Effective Date under the Plan of the New Common Stock or the Subscription   Rights. For the avoidance of doubt, while the Rights Offering shall be   conducted in reliance upon the exemption from registration under the   Securities Act provided in section 1145 of the Bankruptcy Code, the Debtors   are not seeking such an exemption for the New Common Stock issued pursuant to   the Plan Investor Equity Raise or with respect to any shares purchased by   existing shareholders of the Plan Investor that are not Eligible Holders.   15.2. Initial Offer and Sale of Securities Under Federal Securities Laws.   Section 1145(a)(1) of the Bankruptcy Code exempts the offer and sale of   securities under a plan of reorganization from registration under the   Securities Act and under state securities laws if three principal   requirements are satisfied: (a) the securities must be offered and sold “under   a plan” of reorganization and must be securities of the debtor, of an   affiliate “participating in a joint plan” with the debtor or of a successor   to the debtor under the plan; (b) the recipients of the securities must hold   a prepetition or administrative expense claim against the debtor or an   interest in the debtor or such affiliate; and (c) the securities must be   issued entirely in exchange for the recipient’s claim against or interest in   the debtor, or “principally” in such exchange and “partly” for cash or   property. The Debtors believe that the provisions of section 1145(a)(l) of   the Bankruptcy Code exempt the initial offer and distribution of the New   Common Stock and Subscription 127 

    

 

Rights32 on the   Effective Date under the Plan from federal and state securities registration   requirements. Notwithstanding any language to the contrary contained in the   Disclosure Statement, Plan, Confirmation Order, and/or Plan Documents, Class   4 shall not be allowed to participate in the Rights Offering in an amount   greater than the allowed Novelion Intercompany Loan Claim. 15.3. Subsequent   Transfers. The New Common Stock and Rights Offering Stock received by holders   of Class 4 Novelion Intercompany Loan Claims and Class 6B Other General   Unsecured Claims under the Plan shall be treated as having been issued in a   public offering for purposes of resales and subsequent transfers by such   persons of the New Common Stock and Rights Offering Stock, unless the holder   is an “underwriter” with respect to such securities. Section 1145(b) of the   Bankruptcy Code defines four types of “underwriters”: (i) a Person who   purchases a claim against, an interest in, or a claim for an administrative   expense against the debtor with a view to distributing any security received   in exchange for such claim or interest; (ii) a Person who offers to sell   securities offered or sold under a plan for the holders of such securities;   (iii) a Person who offers to buy securities offered or sold under a plan from   the holders of such securities, if the offer to buy is: (A) with a view to   distributing such securities; and (B) under an agreement made in connection   with the plan, the consummation of the plan, or with the offer or sale of   securities under the plan; and (iv) a Person who is an “issuer” (as defined   in section 2(a)(11) of the Securities Act) with respect to the securities.   Under section 2(a)(11) of the Securities Act, an “issuer” includes any Person   directly or indirectly controlling or controlled by the issuer, or any Person   under direct or indirect common control of the issuer. 32 To qualify for   exemption under section 1145(a)(1) of the Bankruptcy Code, the amount raised   in the rights offering must be less than the value of the claims of   participating creditors. While there is no clear rule to determine whether   the rights offering is “principally” in exchange for claims or interests, the   SEC has consistently taken the position that the amount of the new money   raised cannot exceed 75% of the value of the claims. See, e.g., Bennett Petroleum   Corp., SEC No-Action Letter, 1983 WL 28907 (Dec. 27, 1983); Jet Florida   System, Inc., SEC No-Action Letter, 1987 WL 107448 (Jan. 12, 1987). 128 

    

 

To the extent   that Persons who receive New Common Stock and Rights Offering Stock pursuant   to the Plan are deemed to be underwriters or “affiliates” of the issuer,   resales by such Persons would not be exempted from registration under the   Securities Act or other applicable law by section 1145 of the Bankruptcy   Code. Persons deemed to be affiliates may, however, be permitted to resell   such New Common Stock and Rights Offering Stock without registration pursuant   to the provisions of Rule 144 under the Securities Act or another available   exemption under the Securities Act. In addition, such Persons will also be   entitled to resell their New Common Stock and Rights Offering Stock in   transactions registered under the Securities Act following the effectiveness   of the registration statement, which the Plan Investor will file as soon as   reasonably practicable after the Effective Date, registering the resale of   all of the New Common Stock and the Rights Offering Stock that are “control”   securities. The Debtors believe that Novelion is not an “underwriter” as   defined in section 1145(b) of the Bankruptcy Code with respect to the New   Common Stock and Rights Offering Stock to be issued by the Plan Investor to   Novelion under the Plan. Novelion has not: (i) purchased a claim against or   interest in any of the Debtors with a view to distributing any security   received in exchange for such claim or interest; (ii) offered to sell any   securities being offered under the Plan for the holders of such securities;   or (iii) offered to buy any securities being offered under the Plan from the   holders of such securities. Nor is Novelion an “issuer” as such term is used   in section 2(a)(11) of the Securities Act nor an “affiliate” thereof;   Novelion does not directly or indirectly control, is not directly or   indirectly controlled by, or under direct or indirect common control of, the   issuer (i.e., the Plan Investor). As Novelion is not an “underwriter” or   “affiliate,” the New Common Stock and Rights Offering Stock issued to   Novelion under the Plan shall be treated as having been issued in a public   offering for purposes of resales and transfers by Novelion. Holders of New   Common Stock and Rights Offering Stock who are deemed “affiliates” of the   issuer may resell New Common Stock and Rights Offering Stock pursuant to the   limited safe harbor resale provision under Rule 144 of the Securities Act.   Generally, if the issuer is a “reporting company” (i.e., an issuer that has   been subject to the reporting requirements of Section 13 or 15(d) of the   Securities Exchange Act of 1934 (the “Exchange Act”) for at least 90 days),   Rule 144 would permit the public sale of securities received by such Person   if, at the time of the sale, certain current public information regarding the   issuer is available and only if such Person also complies with the volume,   manner of sale and notice requirements of Rule 144. If the issuer is not a   “reporting company”, adequate current public information as specified under   Rule 144 is available if certain company information is made publicly   available, as specified in Section (c)(2) of Rule 144. The Debtors expect   that Aegerion and the Plan Investor will jointly file a Form F-1 registration   statement (“Form F-1”) with the SEC and will use their reasonable best   efforts for the Form F-1 to be declared effective as soon as reasonably   practicable after the Effective Date. Aegerion and the Plan Investor will   also use their reasonable best efforts to cause the closing shares to be   listed and approved for trading on NASDAQ on the Effective Date or as soon as   reasonably practicable thereafter. Upon such filings, the Plan Investor will   be a “reporting company” in the United States and will be subject to the   reporting requirements of Section 13 or 15(d) of the Exchange Act. 129 

    

 

Whether or not   any particular Person would be deemed to be an underwriter or affiliate of   the issuer with respect to the New Common Stock, Rights Offering Stock or   other security to be issued pursuant to the Plan would depend upon various   facts and circumstances applicable to that Person. Accordingly, the Debtors   express no view as to whether any particular Person receiving New Common   Stock, Rights Offering Stock or other securities under the Plan would be an   underwriter with respect to such New Common Stock, Rights Offering Stock or   other securities, whether such Person may freely resell such securities or   the circumstances under which they may resell such securities. ARTICLE XVI.   PROCEDURES FOR DISTRIBUTIONS UNDER THE PLAN 16.1. Distributions. The Disbursing   Agent shall make all Plan Distributions to the appropriate holders of Allowed   Claims in accordance with the terms of the Plan. Distributions to holders of   Allowed General Unsecured Claims (on account of Convertible Notes Claims)   shall be made by the Convertible Notes Trustee and deemed completed when made   to the indenture trustee as Disbursing Agent. Plan Distributions on account   of the Bridge Loan Claim (other than the payment of any unpaid fees and   expenses of the Bridge Loan Administrative Agent which shall be paid to the   Bridge Loan Administrative Agent in Cash on the Effective Date) shall not be   made to the Bridge Loan Administrative Agent but instead shall be distributed   directly to the Bridge Loan Lenders as reflected on the registry maintained by   the Bridge Loan Administrative Agent as of the Confirmation Date. The Debtors   will request such registry from the Bridge Loan Administrative Agent. 130 

    

 

16.2. No   Postpetition Interest on Claims. Other than as specifically provided in the   Plan or the Confirmation Order, or required by applicable bankruptcy or   non-bankruptcy law, postpetition interest shall not accrue or be paid on any   Claims, and no holder of a Claim shall be entitled to interest accruing on   such Claim on or after the Petition Date. 16.3. Date of Distributions. Unless   otherwise provided in the Plan, any Plan Distributions and deliveries to be   made pursuant to the Plan shall be made on the applicable Distribution Date;   provided, that the Reorganized Debtors may utilize periodic distribution   dates to the extent that use of a periodic distribution date does not delay   payment of the Allowed Claim more than sixty (60) days. For the avoidance of doubt,   and notwithstanding anything in the Plan to the contrary, all such Plan   Distributions and deliveries that are to be made in Cash thereunder on the   applicable Distribution Date shall be made from Plan Cash unless otherwise   provided in the Plan. In the event that any payment or act under the Plan is   required to be made or performed on a date that is not a Business Day, then   the making of such payment or the performance of such act may be completed on   or as soon as reasonably practicable after the next succeeding Business Day,   but shall be deemed to have been completed as of the required date. 16.4.   Distribution Record Date. As of the close of business on the Distribution   Record Date, the various lists of holders of Claims in each of the Classes,   as maintained by the Debtors, or their agents, shall be deemed closed and   there shall be no further changes in the record holders of any of the Claims   after the Distribution Record Date. Neither the Debtors nor the Disbursing   Agent shall have any obligation to recognize any transfer of Claims occurring   after the close of business on the Distribution Record Date. Additionally,   with respect to payment of any Cure Amounts or any Cure Disputes in   connection with the assumption and/or assignment of the Debtors’ executory   contracts and unexpired leases, neither the Debtors, the Disbursing Agent nor   the Plan Investor shall have any obligation to recognize or deal with any   party other than the non-Debtor party to the applicable executory contract or   unexpired lease, even if such non-Debtor party has sold, assigned or   otherwise transferred its Claim for a Cure Amount. 16.5. Disbursing Agent.   Powers of Disbursing Agent. The Disbursing Agent shall be empowered to: (i)   effectuate all actions and execute all agreements, instruments, and other   documents necessary to perform its duties under the Plan; (ii) make all   applicable Plan Distributions or payments contemplated hereby; (iii) employ   professionals to represent it with respect to its responsibilities; and (iv)   exercise such other powers as may be vested in the Disbursing Agent by order   of the Bankruptcy Court (including any order issued after the Effective   Date), pursuant to the Plan, or as deemed by the Disbursing Agent to be   necessary and proper to implement the provisions thereof. Expenses Incurred   by the Disbursing Agent on or After the Effective Date. Except as otherwise   ordered by the Bankruptcy Court, and subject to the written agreement of 131 

    

 

the Reorganized   Debtors, the amount of any reasonable and documented fees and expenses   incurred by the Disbursing Agent on or after the Effective Date (including   taxes) and any reasonable compensation and expense reimbursement Claims   (including reasonable attorney and other professional fees and expenses) of the   Disbursing Agent shall be paid in Cash by the Reorganized Debtors. The   foregoing fees and expenses shall be paid in the ordinary course, upon   presentation of invoices to the Reorganized Debtors and without the need for   approval by the Bankruptcy Court, as set forth in Section 3.2(b) of the Plan.   In the event that the Disbursing Agent and the Reorganized Debtors are unable   to resolve a dispute with respect to the payment of the Disbursing Agent’s   fees, costs and expenses, the Disbursing Agent may elect to submit any such   dispute to the Bankruptcy Court for resolution. Bond. The Disbursing Agent   shall not be required to give any bond or surety or other security for the   performance of its duties unless otherwise ordered by the Bankruptcy Court   and, in the event that the Disbursing Agent is so otherwise ordered, all   costs and expenses of procuring any such bond or surety shall be borne by the   Reorganized Debtors. Furthermore, any such entity required to give a bond   shall notify the Bankruptcy Court and the U.S. Trustee in writing before   terminating any such bond that is obtained. Cooperation with Disbursing   Agent. The Reorganized Debtors shall use all commercially reasonable efforts   to provide the Disbursing Agent with the amount of Claims and the identity   and addresses of holders of Claims, in each case, that are entitled to   receive Plan Distributions, as set forth in the Debtors’ or the applicable   Reorganized Debtors’ books and records. The Reorganized Debtors will   cooperate in good faith with the Disbursing Agent to comply with the   withholding and reporting requirements outlined in Section 8.16 of the Plan.   16.6. Delivery of Distribution. Subject to the provisions contained in this   Article VIII, the applicable Disbursing Agent will issue, or cause to be   issued, and authenticate, as applicable, all Plan Consideration, and subject   to Bankruptcy Rule 9010, make all Plan Distributions or payments to any   holder of an Allowed Claim as and when required by the Plan at: (a) the   address of such holder on the books and records of the Debtors or their   agents; or (b) at the address in any written notice of address change   delivered to the Debtors or the applicable Disbursing Agent, including any   addresses included on any filed proofs of Claim or transfers of Claim filed   with the Bankruptcy Court. In the event that any Plan Distribution to any   holder is returned as undeliverable, no distribution or payment to such   holder shall be made unless and until the applicable Disbursing Agent has   been notified of the then current address of such holder, at which time or as   soon as reasonably practicable thereafter such Plan Distribution shall be   made to such holder without interest; provided, however, such Plan   Distributions or payments shall be deemed unclaimed property under section 347(b)   of the Bankruptcy Code at the expiration of the later of one year from (i)   the Effective Date, and (ii) the first Distribution Date after such holder’s   Claim is first Allowed. The Convertible Notes Indenture Trustee shall be   deemed to be the holder of all Allowed Convertible Notes Claims in Class 6B   for purposes of distributions to be made hereunder, and all distributions on   account of such Allowed Claims shall be made to or at the direction of the   Convertible Notes Indenture Trustee except as otherwise provided herein. As   132 

    

 

soon as   practicable following the Effective Date, the Convertible Notes Indenture   Trustee shall arrange to deliver or direct the delivery of such distributions   to or on behalf of the holders of Allowed Convertible Notes Claims in Class   6B in accordance with the terms of the Convertible Notes Indenture and the   Plan. Distributions of the New Convertible Notes to be held through DTC shall   be made through the facilities of DTC in accordance with DTC’s customary practices.   All New Convertible Notes to be distributed pursuant to the Plan shall be   issued in the names of such holders, their nominees of record, or their   permitted designees as of the Distribution Record Date in accordance with   DTC’s book-entry procedures, to the extent applicable; provided that such New   Convertible Notes are permitted to be held through DTC’s book-entry system;   provided, further, that to the extent that the New Convertible Notes are not   eligible for distribution in accordance with DTC’s customary practices, the   Reorganized Debtors will take such reasonable actions as may be required to   cause distributions of the New Convertible Notes under the Plan. No   distributions will be made other than through DTC if the New Convertible   Notes are permitted to be held through DTC’s book entry system. Any   distribution that otherwise would be made to any holder eligible to receive a   distribution of a security available solely through DTC who does not own or   hold an account eligible to receive a distribution through DTC on a relevant   distribution date shall be forfeited. The Reorganized Debtors will cause   distributions of New Common Stock to be made to the CREST account of the   holders of Allowed Convertible Notes Claims, or failing that, to the   Convertible Notes Indenture Trustee to be held on behalf of the holders of   Allowed Convertible Notes Claims and in accordance with the customary   practices of the applicable depositary. All New Common Stock to be   distributed pursuant to the Plan shall be issued in the names of such   holders, their nominees of record, or their permitted designees as of the   Distribution Record Date; provided, that to the extent that the New Common   Stock is American Depositary Shares representing common stock or is not   eligible for distribution as set forth herein, the Reorganized Debtors will   take such reasonable actions as may be required to cause distributions of the   New Common Stock under the Plan. Notwithstanding anything in the Plan to the   contrary, and without limiting the exculpation and release provisions of the   Plan, the Convertible Notes Indenture Trustee shall not have any liability to   any entity with respect to distributions made or directed to be made by the   Convertible Notes Indenture Trustee except for fraud or intentional misconduct.   16.7. Unclaimed Property. Except with respect to holders of Unimpaired   Claims, one year from the later of (i) the Effective Date, and (ii) the first   Distribution Date after such holder’s Claim is first Allowed, all unclaimed   property, wherever located, or interests in property distributable thereunder   on account of such Claim shall revert to the Reorganized Debtors or their   respective successors or assigns of the Reorganized Debtors, and any claim or   right of the holder of such Claim to such property, wherever located, or   interest in property shall be discharged and forever barred. The Reorganized   Debtors and the Disbursing Agent shall have no obligation to attempt to   locate any holder of an Allowed Claim other than by reviewing the Debtors’   books and records, and the proofs of Claim filed against the Debtors, as   reflected on the claims register maintained by the Claims Agent. 133 

    

 

16.8.   Satisfaction of Claims. Unless otherwise specifically provided in the Plan,   any Plan Distributions and deliveries to be made on account of Allowed Claims   thereunder shall be in complete settlement, satisfaction and discharge of   such Allowed Claims. 16.9. Manner of Payment Under Plan. Except as   specifically provided in the Plan, at the option of the Reorganized Debtors,   any Cash payment to be made thereunder may be made by a check or wire   transfer or as otherwise required or provided in applicable agreements or   customary practices of the Debtors or the applicable Reorganized Debtor, as   the case may be. 16.10.Fractional Shares; De Minimis Cash Distributions.   Neither the Reorganized Debtors nor the Disbursing Agent shall have any   obligation to make a Plan Distribution that is less than one (1) share of New   Common Stock or $50.00 in Cash. No fractional shares of New Common Stock   shall be distributed. When any Plan Distribution would otherwise result in   the issuance of a number of shares of New Common Stock that is not a whole   number, the shares of the New Common Stock subject to such Plan Distribution   will be rounded to the next higher or lower whole number as follows: (i)   fractions equal to or greater than 1⁄2 will be rounded to the next higher whole   number; and (ii) fractions less than 1⁄2 will be rounded to the next lower   whole number; provided, that the foregoing shall not apply to any rounding of   the Rights Offering Stock, the distribution of which shall be governed by the   Rights Offering Procedures and Section 7.3 of the Plan. The total number of   shares of New Common Stock to be distributed on account of Allowed Claims   will be adjusted as necessary to account for the rounding provided for in the   Plan. No consideration will be provided in lieu of fractional shares that are   rounded down. Fractional shares of New Common Stock that are not distributed   in accordance with Section 8.11 of the Plan shall be cancelled.   16.11.Distributions on Account of Allowed Claims Only. Notwithstanding   anything in the Plan to the contrary, no Plan Distribution shall be made on   account of a Claim until such Claim becomes an Allowed Claim plus any   postpetition interest on such Claim, to the extent such interest is permitted   under the Plan. 16.12.No Distribution in Excess of Amount of Allowed Claim.   Notwithstanding anything in the Plan to the contrary, no holder of an Allowed   Claim shall, on account of such Allowed Claim, receive a Plan Distribution of   a value in excess of the Allowed amount of such Claim. 16.13.Exemption from   Securities Laws. The issuance of and the distribution under the Plan of the   Plan Securities shall be exempt from registration under the Securities Act   and any other applicable securities laws pursuant to section 1145 of the   Bankruptcy Code, to the maximum extent permitted thereunder. 134 

    

 

The New Common   Stock (including the Rights Offering Stock and New Common Stock issuable upon   the exercise of New Warrants) issued under the Plan will be issued without   registration under the Securities Act or any similar federal, state, or local   law in reliance upon section 1145 of the Bankruptcy Code. New Common Stock   (including the Rights offering and New Common Stock issuable upon the   exercise of New Warrants) issued under the Plan in reliance upon section 1145   of the Bankruptcy Code shall be exempt from, among other things, the   registration requirements of Section 5 of the Securities Act and any other   applicable U.S. state or local law requiring registration prior to the   offering, issuance, distribution, or sale of securities except with respect   to an entity that is an “underwriter” as defined in subsection (b) of section   1145 of the Bankruptcy Code. For the avoidance of doubt, Novelion shall not   be deemed an “underwriter” as defined in subsection (b) of section 1145 of   the Bankruptcy Code. The New Common Stock (including the Rights Offering   Stock and New Common Stock issuable upon the exercise of New Warrants) issued   pursuant to section 1145 of the Bankruptcy Code also does not constitute   “restricted securities” as defined in Rule 144(a)(3) under the Securities   Act, and, subject to the terms of the New Registration Rights Agreement and   the Amended Memorandum of Association, is freely tradable and transferable by   any holder thereof that: (a) is not an “affiliate” of the Reorganized Debtors   as defined in Rule 144(a)(1) under the Securities Act; (b) has not been such   an “affiliate” within 90 days of such transfer; and (c) has not acquired the   New Common Stock from an “affiliate” within one year of such transfer. 16.14.Setoffs   and Recoupments. Except as expressly provided in the Plan, each Reorganized   Debtor may, pursuant to section 553 of the Bankruptcy Code, set off and/or   recoup against any Plan Distributions to be made on account of any Allowed   Claim, any and all claims, rights and Causes of Action that such Reorganized   Debtor may hold against the holder of such Allowed Claim to the extent such   setoff or recoupment is either (a) agreed in amount among the relevant   Reorganized Debtor(s) and holder of such Allowed Claim, or (b) otherwise   adjudicated by the Bankruptcy Court or another court of competent   jurisdiction; provided, however, that neither the failure to effectuate a   setoff or recoupment nor the allowance of any Claim thereunder shall   constitute a waiver or release by a Reorganized Debtor or its successor of   any and all claims, rights and Causes of Action that such Reorganized Debtor   or its successor may possess against the applicable holder. 16.15.Withholding   and Reporting Requirements. In connection with the Plan and all Plan   Distributions thereunder, the Reorganized Debtors shall comply with all   withholding and reporting requirements imposed by any federal, state,   provincial, local or foreign taxing authority, and all Plan Distributions   thereunder shall be subject to any such withholding and reporting   requirements. The Reorganized Debtors shall be authorized to take any and all   action that may be necessary or appropriate to comply with such withholding   and reporting requirements, including requiring a holder of a Claim to submit   appropriate tax and withholding certifications. Notwithstanding any other   provision of the Plan: (a) each holder of an Allowed Claim that is to receive   a Plan Distribution under the Plan shall have sole and exclusive   responsibility for the satisfaction and payment of any tax obligations   imposed by any governmental unit, including income, withholding and other tax   obligations on account of such distribution; and (b) no Plan Distributions   shall be required to be made to or on behalf of such holder pursuant to the   Plan unless and until such holder has made arrangements 135 

    

 

satisfactory to   the Reorganized Debtors for the payment and satisfaction of such tax   obligations or has, to the Reorganized Debtors’ satisfaction, established an   exemption therefrom. 16.16. Hart-Scott Rodino Antitrust Improvements Act. Any   New Common Stock to be distributed under the Plan to an entity required to   file a Premerger Notification and Report Form under the Competition Laws   shall not be distributed until the notification and waiting period applicable   under such Competition Laws to such entity shall have expired or been   terminated or any applicable authorizations, approvals, clearances or   consents have been obtained. ARTICLE XVII. PROCEDURES FOR RESOLVING CLAIMS   17.1. Claims Process. Other than with respect to Fee Claims, only the   Reorganized Debtors shall be entitled to object to Claims after the Effective   Date. Any objections to those Claims (other than Administrative Expense   Claims) shall be served and filed on or before the later of: (a) the date   that is 180 days after the Effective Date; and (b) such other date as may be   fixed by the Bankruptcy Court, whether fixed before or after the date   specified in clause (a) thereof. Any Claims filed after the Bar Date or   Administrative Bar Date, as applicable, shall be deemed disallowed and   expunged in their entirety without further order of the Bankruptcy Court or   any action being required on the part of the Debtors or the Reorganized   Debtors, unless the Person wishing to file such untimely Claim has received   the Bankruptcy Court’s authorization to do so. Notwithstanding any authority   to the contrary, an objection to a Claim shall be deemed properly served on   the claimant if the objecting party effects service in any of the following   manners: (a) in accordance with Federal Rule of Civil Procedure 4, as   modified and made applicable by Bankruptcy Rule 7004; (b) by first class   mail, postage prepaid, on the signatory on the proof of claim as well as all other   representatives identified in the proof of claim or any attachment thereto;   or (c) if counsel has agreed to or is otherwise deemed to accept service, by   first class mail, postage prepaid, on any counsel that has appeared on the   claimant’s behalf in the Chapter 11 Cases (so long as such appearance has not   been subsequently withdrawn). From and after the Effective Date, the   Reorganized Debtors may settle or compromise any Disputed Claim without   approval of the Bankruptcy Court. 17.2. Amendment to Claims. From and after   the Effective Date, no proof of Claim may be amended to increase or assert   additional claims not reflected in a previously timely filed Claim (or Claim   scheduled on the applicable Debtor’s Schedules, unless superseded by a filed   Claim), and any such Claim shall be deemed disallowed and expunged in its   entirety without further order of the Bankruptcy Court or any action being   required on the part of the Debtors or the Reorganized Debtors unless the   claimant has obtained the Bankruptcy Court’s prior approval to file such   amended or increased Claim. Notwithstanding anything to the contrary in this   Section, proofs of Claim and amendments of any kind to proofs of Claim may be   filed by Governmental Units in accordance 136 

    

 

with the   deadlines set by the Order Establishing Deadline for Filing Proofs of Claim   and Approving the Form and Manner of Notice Thereof [Docket No. 51]. 17.3.   Disputed Claims. Disputed Claims shall not be entitled to any Plan   Distributions unless and until they become Allowed Claims. 17.4. Estimation   of Claims. The Debtors and/or Reorganized Debtors may request that the   Bankruptcy Court enter an Estimation Order with respect to any Claim,   pursuant to section 502(c) of the Bankruptcy Code, for purposes of determining   the Allowed amount of such Claim regardless of whether any Person has   previously objected to such Claim or whether the Bankruptcy Court has ruled   on any such objection, and the Bankruptcy Court shall retain jurisdiction to   estimate any Claim at any time (including during the pendency of any appeal   with respect to the allowance or disallowance of such Claims). In the event   that the Bankruptcy Court estimates any contingent or unliquidated Claim for   allowance or distribution purposes, that estimated amount will constitute   either the Allowed amount of such Claim or a maximum limitation on such   Claim, as determined by the Bankruptcy Court. If the estimated amount   constitutes a maximum limitation on such Claim, the objecting party may elect   to pursue any supplemental proceedings to object to any ultimate allowance of   such Claim. All of the objection, estimation, settlement, and resolution   procedures set forth in the Plan are cumulative and not exclusive of one   another. Claims may be estimated and subsequently compromised, settled,   resolved or withdrawn by any mechanism approved by the Bankruptcy Court. 137 

    

 

CONCLUSION The   Debtors believe that confirmation and implementation of the Plan is   preferable to any of the alternatives described herein because it will   provide the greatest recovery to holders of Claims. Other alternatives would   involve significant delay, uncertainty and substantial administrative costs   and are likely to reduce any return to creditors who hold Claims.   Accordingly, the Debtors urge the holders of impaired Claims in Classes 3, 4   and 6B who are entitled to vote on the Plan to vote to accept the Plan and to   evidence such acceptance by returning their Ballots to the Voting Agent so   that they will be received not later than 4:00 p.m. (prevailing Eastern time)   on [August 15, 2019]. Dated: July [], 2019 New York, New York Respectfully   submitted, Aegerion Pharmaceuticals, Inc. on behalf of itself and its   affiliated Debtors By: John R. Castellano Chief Restructuring Officer   Counsel: WILLKIE FARR & GALLAGHER LLP Paul V. Shalhoub Andrew S. Mordkoff   787 Seventh Avenue New York, NY 10019 (212) 728-8000 Counsel for the Debtors   and Debtors in Possession 138Exhibit 10.3

 

	
UNITED STATES BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632 (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

ORDER: (I) APPROVING DISCLOSURE STATEMENT;

(II) ESTABLISHING DATE OF CONFIRMATION HEARING;

(III) ESTABLISHING PROCEDURES FOR SOLICITATION AND

TABULATION OF VOTES TO ACCEPT OR REJECT PLAN,

INCLUDING (A) APPROVING FORM AND MANNER OF SOLICITATION

PACKAGES, (B) APPROVING FORM AND MANNER OF NOTICE OF

CONFIRMATION HEARING, (C) ESTABLISHING RECORD DATE

AND APPROVING PROCEDURES FOR DISTRIBUTION OF SOLICITATION

PACKAGES, (D) APPROVING FORMS OF BALLOTS, (E) ESTABLISHING

DEADLINE FOR RECEIPT OF BALLOTS, AND (F) APPROVING

PROCEDURES FOR VOTE TABULATIONS; (IV) ESTABLISHING

DEADLINE AND PROCEDURES FOR FILING

OBJECTIONS TO CONFIRMATION OF PLAN; (V) APPROVING

RIGHTS OFFERING PROCEDURES; AND (VI) GRANTING RELATED RELIEF

 

Upon consideration of the motion (the “Motion”)(2) of the debtors and debtors in possession in the above-captioned cases (collectively, the “Debtors”) for entry of an order, pursuant to sections 105, 363, 1125 and 1126 of title 11 of the United States Code (the “Bankruptcy Code”), Rules 2002, 3016, 3017 and 3020 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”) and Rule 3017-1 of the Local Bankruptcy Rules for the Southern District of New York: (i) approving the Disclosure Statement for Debtors’ Joint Chapter 11 Plan (including all exhibits thereto and as may be amended, modified or

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 Capitalized terms used but not defined herein shall have the respective meanings given to them in the Motion.

 

 

supplemented from time to time, the “Disclosure Statement”); (ii) establishing the date of the hearing regarding confirmation of the Plan (the “Confirmation Hearing”); (iii) establishing procedures for the solicitation and tabulation of votes to accept or reject the Debtors’ Joint Chapter 11 Plan (including all exhibits thereto and as may be amended, modified or supplemented from time to time, the “Plan”), including (a) approving the form and manner of the solicitation packages to be sent to parties in interest in these cases, (b) approving the form and manner of notice of the Confirmation Hearing, (c) establishing a voting record date and approving procedures for distributing solicitation packages, (d) approving the forms of ballots, (e) establishing the deadline for the receipt of ballots, and (f) approving procedures for tabulating acceptances and rejections of the Plan; (iv) establishing the deadline and procedures for filing objections to confirmation of the Plan; (v) approving the procedures for the Rights Offering, and corresponding subscription form, substantially in the forms annexed hereto as Exhibit D (including all exhibits thereto, and as the same may be amended, modified or supplemented from time to time, the “Rights Offering Procedures”); and (vi) granting related relief; and it appearing that due and sufficient notice pursuant to Bankruptcy Rule 2002(b) of the hearing to approve the Motion and the Disclosure Statement has been given; and after due deliberation and upon the Court’s determination that the relief requested in the Motion is in the best interests of the Debtors, their estates and creditors and other parties in interest; and sufficient cause appearing therefor, it is hereby

 

ORDERED, ADJUDGED AND DECREED that:

 

1.                                      The Motion is granted to the extent set forth herein.

 

2.                                      The Disclosure Statement is approved as containing adequate information within the meaning of section 1125 of the Bankruptcy Code.

 

2

 

3.                                      Except as provided in paragraph 5 below, the Debtors shall mail or cause to be mailed to holders of claims against each of the Debtors entitled to vote on the Plan, so that such mailing commences no later than July 18, 2019 (the “Solicitation Commencement Deadline”), a solicitation package containing: (a) written notice (the “Confirmation Hearing Notice”), substantially in the form attached hereto as Exhibit A, of (i) the Court’s approval of the Disclosure Statement, (ii) the deadline for voting on the Plan, (iii) the date of the Confirmation Hearing, and (iv) the deadline and procedures for filing objections to confirmation of the Plan, which Confirmation Hearing Notice is approved; (b) copies of the Plan and the Disclosure Statement, which may be on a USB flash drive; (c) the appropriate ballot (substantially in the forms attached hereto as Exhibits B-1 through B-5) and ballot return envelope; and (d) such other information as the Court may direct or approve (collectively, the “Solicitation Package”). The Solicitation Package and the manner of service of the Solicitation Package satisfies the requirements of Bankruptcy Rule 3017(d).

 

4.                                      Pursuant to Bankruptcy Rule 3017(d), the Debtors are not required to transmit a Solicitation Package to holders of Class 1 (Priority Non-Tax Claims), Class 2 (Other Secured Claims), Class 5 (Ongoing Trade Claims), Class 6A (Government Settlement Claims), Class 7 (Existing Securities Law Claims) and Class 8 (Existing Interests) (the “Non-Voting Parties”). The Debtors shall mail or cause to be mailed to each Non-Voting Party, so that such mailing commences no later than the Solicitation Commencement Deadline, the applicable Non-Voting Notice, substantially in the forms attached hereto as Exhibit C-1 (for Unimpaired Creditors) and C-2 (for Non-Voting Impaired Classes). Subject to the procedures set forth herein relating to temporary allowance of Claims for voting purposes, the Non-Voting Parties shall not be entitled to vote on the Plan.

 

3

 

5.                                      With respect to Solicitation Packages to be distributed to holders of Claims in Class 6B related to the Convertible Notes Claims, the Debtors shall distribute or cause to be distributed Solicitation Packages, including Ballots, to record holders of such claims, including without limitation, indenture trustees, brokers, banks, commercial banks, transfer agents, trust companies, dealers, or other agents or nominees (collectively, the “Voting Nominees”), and each Voting Nominee shall be entitled to receive reasonably sufficient numbers of Solicitation Packages (including Beneficial Ballots) to distribute via first class mail to the beneficial owners of the claims for whom such Voting Nominee acts (collectively, the “Beneficial Owners”). Each Voting Nominee is directed to forward the Solicitation Package to the Beneficial Owners of the Convertible Notes Claims entitled to vote on the Plan represented by such Voting Nominee using one of the following two methods (to be selected by the Voting Nominee) within five (5) business days of receipt of the Solicitation Packages:

 

a.                                      Master Ballots: A Voting Nominee may obtain the votes of Beneficial Owners by forwarding to the Beneficial Owners the applicable unsigned Beneficial Ballot, together with the Solicitation Package, a return envelope provided by, and addressed to, the Voting Nominee, and other materials requested to be forwarded. Each such Beneficial Owner may then indicate its vote on the Beneficial Ballot, provide the information requested in the Beneficial Ballot, review the certifications contained in the Beneficial Ballot, and return the Beneficial Ballot in sufficient time to be summarized on a master ballot (the “Master Ballot”), in substantially the form of the Master Ballot (and instructions attached thereto) annexed to the Proposed Order as Exhibit B-3. The Voting Nominee then will summarize the individual votes of its respective Beneficial Owners from their Beneficial Ballots (in substantially the form of the Ballot annexed hereto as Exhibit B- 4) on the Master Ballot and then return the Master Ballot to the Solicitation Agent so that it is received prior to the Voting Deadline. All Beneficial Ballots returned by Beneficial Owners will be retained by Voting Nominees for inspection for at least one year from the Voting Deadline.

 

b.                                      Pre-Validated Ballots: A Voting Nominee may pre-validate a Beneficial Ballot by, as applicable: (i) signing the applicable Beneficial Ballot; (ii) indicating on the Beneficial Ballot the account number of the applicable Beneficial Owner, and the amount of the securities held by the Voting Nominee for such Beneficial Owner; and (iii) forwarding such Beneficial

 

4

 

Ballot together with the Solicitation Package and other materials requested to be forwarded to the Beneficial Owner for voting. The Beneficial Owner may then indicate its vote on the Beneficial Ballot, provide the information requested in the Beneficial Ballot, review the certifications contained in the Beneficial Ballot, and return the Beneficial Ballot directly to the Solicitation Agent so that it is received by the Solicitation Agent before the Voting Deadline. A list of the Beneficial Owners to whom pre-validated Beneficial Ballots were delivered will be maintained by each applicable Voting Nominee for inspection for at least one year from the Voting Deadline.

 

6.                                      The Debtors are authorized to distribute or cause to be distributed Master Ballots to the Voting Nominees in accordance with customary procedures. Each Voting Nominee shall (i) return such results in a Master Ballot, and (ii) retain the copies of the underlying Ballots received from the Beneficial Owners for inspection for a period of one year following the Voting Deadline.

 

7.                                      In order for its vote to be counted, the Beneficial Owner is required to return its Beneficial Ballot to the Voting Nominee, in a return envelope which shall be provided by and addressed to the Voting Nominee, so that it is received prior to the Voting Deadline, or such earlier deadline as may be established by the Voting Nominee.

 

8.                                      July 11, 2019 is established as the record date (the “Voting Record Date”) for purposes of determining the creditors and interest holders of the Debtors entitled to receive the Solicitation Package or a Non-Voting Notice and to vote on the Plan; provided, however, with respect to transfers of claims filed pursuant to Bankruptcy Rule 3001, the holder of a claim as of the Voting Record Date shall be the transferor of such claim unless the documentation evidencing such transfer was docketed by the Bankruptcy Court on or before twenty-one (21) days prior to the Voting Record Date and no timely objection with respect to such transfer was filed by the transferor.

 

5

 

9.                                      Prime Clerk LLC (“Prime Clerk” or the “Solicitation Agent” or the “Balloting Agent”, as applicable) will inspect, monitor and supervise the Plan solicitation process, tabulate the ballots and certify to the Court the results of the balloting.

 

10.                               The Debtors are permitted to dispense with the mailing of Solicitation Packages or Non-Voting Notices to addresses and entities to which the notice of the Disclosure Statement hearing was returned by the United States Postal Service as undeliverable, unless the Debtors or the Solicitation Agent are provided with an accurate address at least seven (7) days before the Voting Deadline.

 

11.                               The Paper Ballots, including the Master Ballots, substantially in the forms attached hereto as Exhibits B-1 through B-5, are hereby approved.

 

12.                               All Ballots and Master Ballots must be properly executed, completed and delivered to the Balloting Agent by (a) electronic submission through the Balloting Agent’s “E-Ballot” platform, located at https://cases.primeclerk.com/aegerion, or (b) first class mail, overnight mail, hand delivery, or courier, in each case, in the return envelope provided with the Ballots, to: Aegerion Pharmaceuticals, Inc. Ballot Processing Center, c/o Prime Clerk LLC, One Grand Central Place, 60 East 42nd Street, Suite 1440, New York, NY 10165, so that the Ballots and Master Ballots are received on or before August 15, 2019 at 4:00 p.m. (prevailing Eastern Time) (the “Voting Deadline”), unless extended by the Debtors. The Ballots and Master Ballots cast by facsimile or email will not be counted unless approved in advance by the Debtors, upon consultation with the Committee, in writing.

 

13.                               For purposes of voting on the Plan, with respect to all creditors of the Debtors entitled to vote on the Plan, the Debtors propose that the amount of a claim used to tabulate acceptance or rejection of the Plan should be, as applicable:

 

6

 

a.                                      the claim amount listed in the Debtors’ schedules of liabilities, provided that (i) such claim is not scheduled as contingent, unliquidated, undetermined or disputed, and (ii) no proof of claim has been timely filed (or otherwise deemed timely filed by the Court under applicable law); however, if the applicable bar date has not yet passed at the time of the Voting Record Date, such claims shall be entitled to vote for the purpose of numerosity in the amount of $1.00;

 

b.                                      the noncontingent and liquidated amount specified in a proof of claim timely filed with Prime Clerk (or otherwise deemed timely filed by the Court under applicable law) to the extent the proof of claim is not the subject of an objection filed no later than five (5) business days prior to the Voting Deadline (or, if such claim has been resolved pursuant to a stipulation or order entered by the Court, or otherwise resolved by the Court, the amount set forth in such stipulation or order);

 

c.                                       the amount temporarily allowed by the Court for voting purposes, pursuant to Bankruptcy Rule 3018(a), provided that a motion is brought, notice is provided and a hearing is held no later than five (5) business days prior to the Confirmation Hearing, in accordance with the Bankruptcy Code, the Bankruptcy Rules and the Local Rules;

 

d.                                      except as otherwise provided in subparagraph (c) hereof, with respect to Ballots cast by alleged creditors whose claims (i) are not listed on the Debtors’ schedules of liabilities or (ii) are listed as disputed, contingent and/or unliquidated on the Debtors’ schedules of liabilities, but who have timely filed proofs of claim in unliquidated or unknown amounts that are not the subject of an objection filed before the commencement of the Confirmation Hearing, such ballots shall be counted as allowed claims in the amount of $1 solely for the purpose of determining whether the requirements of section 1126(c) of the Bankruptcy Code have been satisfied;

 

e.                                       if the Debtors or the Solicitation Agent determine, in their discretion after reasonable review, that a creditor has filed duplicative proofs of claim against the same Debtor, only the last proof of claim will be used for the purpose of vote tabulation regardless of whether the Debtors have objected to such duplicative claim; and

 

f.                                        if a proof of claim has been amended by a later filed proof of claim, the later filed amended claim shall be entitled to vote in a manner consistent with the tabulation rules, and the earlier filed claim

 

7

 

should be disallowed for voting purposes, regardless of whether the Debtors have objected to such amended claim.

 

14.                               Holders of claims filed in the amount of $0.00 shall not be entitled to vote.

 

15.                               The Debtors may object to any claim (as defined in section 101(5) of the Bankruptcy Code) solely for Plan voting purposes by filing a determination motion (the “Determination Motion”) with the Court no later than ten (10) business days before the Voting Deadline. Responses, if any, to the Determination Motion shall be filed no later than five (5) business days prior to the hearing on the Determination Motion. The Court will schedule a hearing on any Determination Motion no later than five (5) business days prior to the Voting Certification Deadline. If a Determination Motion is filed, the ruling by the Court on the Determination Motion shall be considered a ruling with respect to the allowance of the claim(s) under Bankruptcy Rule 3018 and such claim(s) shall be counted, for voting purposes only, in the amount determined by the Court. The filing of a Determination Motion or a ruling by the Court thereon shall not affect the right or ability of the Debtors, upon the Effective Date, to later object to such claim(s) for any other purposes, including distribution under the Plan.

 

16.                               The Balloting Agent shall tabulate the vote on account of a Claim subject to a Determination Motion in accordance with the Determination Motion unless the creditor files a Claims Estimation Motion no later than five (5) business days before the Voting Deadline. If a creditor files a timely Claims Estimation Motion, the Debtors and the creditor shall request a hearing before the Voting Certification Deadline.

 

17.                               Any creditor seeking to have a claim temporarily allowed for purposes of voting to accept or reject the Plan pursuant to Bankruptcy Rule 3018(a) must file a motion (the “Claims Estimation Motion”) no later than five (5) business days prior to the Voting Deadline.

 

8

 

This Court shall schedule a hearing on such Claims Estimation Motion for a date that is no later than five (5) business days prior to the Voting Certification Deadline.

 

18.                               If a creditor casts a ballot and has timely filed a proof of claim (or has otherwise had a proof of claim deemed timely filed by the Court under applicable law), but the creditor’s claim is the subject of an objection filed no later than five (5) business days before the Voting Deadline, in accordance with Bankruptcy Rule 3018, the creditor’s ballot shall not be counted (subject to the immediately following sentence), unless such claim is temporarily allowed by this Court for voting purposes, pursuant to Bankruptcy Rule 3018(a), after a Claims Estimation Motion is brought by such creditor, notice is provided and a hearing is held no later than five (5) business days before the Voting Certification Deadline. If an objection to a claim requests that such claim be reclassified and/or allowed in a fixed, reduced amount, such claimant’s ballot shall be counted in such reduced amount and/or as the reclassified category, unless otherwise ordered by this Court after a Claims Estimation Motion is brought by such creditor in accordance with the provisions of this Order.

 

19.                               The following voting procedures and standard assumptions shall be used in tabulating the Ballots:

 

a.                                      For purposes of the numerosity requirement of section 1126(c) of the Bankruptcy Code, separate claims held by a single creditor in a particular class will be aggregated as if such creditor held one claim against the Debtors in such class, and the votes related to such claims will be treated as a single vote to accept or reject the Plan.

 

b.                                      Creditors must vote all of their claims within a particular class either to accept or reject the Plan and may not split their vote. Accordingly, an individual ballot or multiple ballots with respect to multiple claims within a single class (as opposed to the Master Ballot) that partially rejects and partially accepts the Plan will not be counted.

 

c.                                       Ballots that fail to indicate an acceptance or rejection of the Plan or that indicate both acceptance and rejection of the Plan, but which are otherwise

 

9

 

properly executed and received prior to the Voting Deadline, will not be counted.

 

d.                                      Only ballots that are timely received with signatures will be counted. Unsigned ballots will not be counted. For creditors submitting their votes by E-Ballot, the creditor’s electronic signature will be deemed to be immediately legally valid and effective.

 

e.                                       Ballots postmarked prior to the Voting Deadline, but received after the Voting Deadline, will not be counted.

 

f.                                        Ballots which are illegible, or contain insufficient information to permit the identification of the creditor, will not be counted.

 

g.                                       Whenever a creditor casts more than one ballot voting the same claim prior to the Voting Deadline, the last valid ballot received prior to the Voting Deadline shall be deemed to reflect the voter’s intent and supersede any prior ballots.

 

h.                                      If a creditor simultaneously casts inconsistent duplicate ballots with respect to the same claim, such ballots shall not be counted.

 

i.                                          Each creditor shall be deemed to have voted the full amount of its claim. Unless otherwise ordered by the Court, questions as to the validity, form, eligibility (including time of receipt), acceptance, and revocation or withdrawal of ballots shall be determined by the Balloting Agent and the Debtors in their sole discretion, which determination shall be final and binding.

 

j.                                         If no creditor or interest holder in a particular class or classes entitled to vote to accept or reject the Plan votes either to accept or reject the Plan, such class or classes shall be deemed to have accepted the Plan.

 

k.                                      Subject to the requirements of, and compliance with, Bankruptcy Rule 3018, any creditor entitled to vote to accept or reject the Plan who has delivered a valid Ballot for the acceptance or rejection of the Plan may withdraw such acceptance or rejection by delivering a written notice of withdrawal to the Balloting Agent at any time prior to the Voting Deadline. In order for a notice of withdrawal to be valid, it must (i) describe the claim, (ii) be signed by the creditor in the same manner as the Ballot was originally signed, and (iii) be received by the Balloting Agent on or before the Voting Deadline. The Debtors reserve the absolute right to contest the validity of any such withdrawals of Ballots.

 

20.                               The following additional rules apply to the tabulation of Master Ballots and Beneficial Ballots cast by Voting Nominees and Beneficial Owners:

 

10

 

a.                                      Votes cast by Beneficial Owners through a Voting Nominee will be applied against the positions held by such entities in the applicable security as of the Voting Record Date, as evidenced by the record and depository listings. Votes submitted by a Voting Nominee, pursuant to the Master Ballots or pre-validated Beneficial Ballots, will not be counted in excess of the principal amount of such securities held by such Voting Nominee.

 

b.                                      To the extent that conflicting votes or “overvotes” are submitted by a Voting Nominee, the Balloting Agent, in good faith, will attempt to reconcile discrepancies with the Voting Nominee.

 

c.                                       To the extent that overvotes on the Master Ballot are not reconcilable prior to the preparation of the vote certification, the Balloting Agent will apply the votes to accept and to reject the Plan in the same proportion as the votes to accept and reject the Plan submitted on the Master Ballots or pre-validated Beneficial Ballots that contained the overvote, but only to the extent of the Voting Nominee’s position in the applicable security.

 

d.                                      Where a Beneficial Owner holds its Convertible Notes Claims through more than one Voting Nominee, it must execute a separate Class 6B Ballot for each block of Convertible Notes Claims. However, such holder must vote all of its Convertible Notes Claims in Class 6B in the same manner, to either accept or reject the Plan. Accordingly, if such holder returns more than one Ballot to more than one Voting Nominee voting different Convertible Notes Claims within Class 6B under the Plan and the Ballots are not voted in the same manner, as reflected on such separate Master Ballots, such votes will not be counted.

 

e.                                       For the purposes of tabulating votes, each Beneficial Owner will be deemed to have voted the principal amount relating to such security, although the Voting Agent may adjust such principal amount to reflect the claim amount, including prepetition interest.

 

21.                               Any objections or responses to the proposed confirmation of the Plan (including any supporting memoranda) must be: (a) in writing; (b) state the name, address, and nature of the claim or interest of the objecting or responding party; (c) state with particularity the provision or provisions of the Plan objected to and for any objection asserted, the legal and factual basis for such objection; (d) provide proposed language to remedy such objection, if possible; and (e) be filed, together with proof of service, with the Court, and served so that objections and responses are actually received no later than August 22, 2019 at 4:00 p.m.

 

11

 

(prevailing Eastern Time). The Court shall consider only timely filed written objections. All objections not timely filed and served in accordance with the provisions of the Motion are hereby deemed waived. Objections to confirmation of the Plan shall be served on the following parties, with a hard copy delivered to the Judge’s Chambers: (i) Aegerion Pharmaceuticals, Inc., 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142 (Attn: John R. Castellano); (ii) proposed counsel to the Debtors, Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, NY 10019 (Attn: Paul V. Shalhoub, Esq. and Andrew S. Mordkoff, Esq.); (iii) counsel to those certain lenders under the Debtors’ proposed debtor-in-possession financing facility, the Debtors’ prepetition secured bridge loan credit agreement and the Debtors’ 2% unsecured convertible notes, Latham & Watkins LLP, 330 North Wabash Avenue, Suite 2800, Chicago, IL 60611 (Attn: Richard A. Levy, Esq.) and King & Spalding LLP, 444 West Lake Street, Suite 1650, Chicago, IL 60606 (Attn: Matthew L. Warren, Esq.); (iv) proposed counsel to the Committee, Kramer Levin Naftalis & Frankel LLP, 1177 Avenue of the Americas, New York, NY 10036 (Attn: Kenneth H. Eckstein, Esq. and Rachael Ringer, Esq.); (v) counsel to the U.S. Trustee for Region 2, 201 Varick Street, Suite 1006, New York, NY 10014 (Attn: Benjamin J. Higgins, Esq. and Brian S. Masumoto, Esq.); (vi) counsel to Novelion Therapeutics Inc., Goodwin Procter LLP, The New York Times Building, 620 Eighth Avenue, New York, NY 10018 (Attn: Gregory Fox, Esq. and Jacqueline Mercier, Esq.); and (vii) counsel to Amryt Pharma Plc, Gibson, Dunn & Crutcher LLP, 200 Park Avenue, New York, NY 10166 (Attn: Matthew J. Williams, Esq. and Jason Zachary Goldstein, Esq.).

 

22.                               The Confirmation Hearing shall be held before this Court commencing on September 5, 2019 at 10:00 a.m. (prevailing Eastern Time), or as soon thereafter as counsel can be heard.

 

12

 

23.                               The Debtors are authorized to publish the Confirmation Hearing Notice once in (a) The New York Times National Edition, (b) The New York Times International Edition, and (c) The Boston Globe not later than July 25, 2019. Additionally, the Debtors shall post the Confirmation Hearing Notice electronically at the Balloting Agent’s website at http://cases.primeclerk.com/aegerion. Such publication of the Confirmation Hearing Notice complies with all requirements of due process and is deemed to provide sufficient notice of the approval of the Disclosure Statement, the Voting Record Date, the Voting Deadline, the time fixed for filing objections to confirmation of the Plan, and the time, date and place of the Confirmation Hearing to persons who do not otherwise receive actual written notice by mail as provided for in this Order and such notice is approved as adequate.

 

24.                               The Confirmation Hearing may be adjourned from time to time without further notice to creditors and other parties-in-interest by an announcement of the adjourned date at the Confirmation Hearing of any adjournment thereof or the filing of a notice or other appropriate filing with the Court; provided, the Debtors shall notify the Committee in advance of any adjournment of the Confirmation Hearing.

 

25.                               Prior to mailing the Disclosure Statement, Solicitation Packages, and Non-Voting Notices, the Debtors may fill in any missing dates and other information, correct any typographical errors, make the revisions to the Disclosure Statement and Plan reflected in the record of the hearing on the Motion, and make such other non-material, non-substantive changes to any such documents as the Debtors deem appropriate; provided, that a copy of any such changes shall be provided to the Committee in advance of their distribution and publication.

 

26.                               The Rights Offering may be commenced and conducted in accordance with the terms and conditions of the Rights Offering Procedures and the subscription form, in

 

13

 

substantially the forms annexed hereto as Exhibit D, and the Debtors and the Plan Investor may take such actions, including, but not limited to, engaging a subscription agent and expending funds, as necessary or appropriate to conduct and implement the Rights Offering.

 

27.                               The Debtors are authorized and empowered to take such steps and expend such funds as are necessary or appropriate to implement the terms of this Order.

 

28.                               This Court shall retain jurisdiction over all matters related to or arising from the Motion or the interpretation or implementation of this Order.

 

	
IT IS   SO ORDERED.
    	
 
    
	
 
    	
 
    
	
Dated:  July 11, 2019
    	
 
    
	
New York, New York
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Martin Glenn
    
	
 
    	
MARTIN GLENN
    
	
 
    	
United States   Bankruptcy Judge
    

 

14

 

	
UNITED STATES   BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632 (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

NOTICE OF (I) APPROVAL OF DISCLOSURE STATEMENT, (II) DEADLINE FOR

VOTING ON PLAN, (III) HEARING TO CONSIDER CONFIRMATION OF PLAN,

AND (IV) DEADLINE FOR FILING OBJECTIONS TO CONFIRMATION OF PLAN

 

PLEASE TAKE NOTICE OF THE FOLLOWING:

 

APPROVAL OF DISCLOSURE STATEMENT

 

1.                                      By order dated July 11, 2019 (the “Disclosure Statement Order”), the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) approved the Disclosure Statement for Debtors’ First Amended Joint Chapter 11 Plan (including all exhibits thereto and as amended, modified or supplemented from time to time, the “Disclosure Statement”) as containing “adequate information” within the meaning of section 1125 of title 11 of the United States Code (the “Bankruptcy Code”), and authorized the Debtors to solicit votes to accept or reject the Debtors’ First Amended Joint Chapter 11 Plan (including all exhibits thereto and as amended, modified or supplemented from time to time, the “Plan”),(2) annexed as Exhibit 1 to the Disclosure Statement.

 

DEADLINE FOR VOTING ON THE PLAN

 

2.                                      By the Disclosure Statement Order, the Bankruptcy Court established August 15, 2019 at 4:00 p.m. (prevailing Eastern Time) (the “Voting Deadline”) as the deadline by which ballots accepting or rejecting the Plan must be received. Holders of claims entitled to vote on the Plan will receive ballots for casting such votes. To be counted, original ballots, or Master Ballots including votes of beneficial owners, must actually be received on or before the Voting Deadline by Prime Clerk LLC (the “Balloting Agent”) by (a) electronic submission through the Balloting Agent’s “E-Ballot” platform, located at the Balloting Agent’s website, http://cases.primeclerk.com/aegerion, or (b) first class mail, overnight mail, hand delivery, or courier at the following address: Aegerion Pharmaceuticals, Inc. Ballot Processing Center, c/o Prime Clerk LLC, One Grand Central Place, 60 East 42nd Street, Suite 1440, New York, NY

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 All capitalized terms used but not defined herein have the meanings given them in the Plan.

 

 

10165. Except as set forth in the Disclosure Statement Order, ballots cast by facsimile or email will not be counted.

 

3.                                      Holders of (a) unimpaired Claims under the Plan that are deemed to have accepted the Plan, and (b) impaired Claims and Interests that are deemed to reject the Plan are not entitled to vote on the Plan and, therefore, will receive a Non-Voting Notice (as such term is defined in the Disclosure Statement Order) rather than a ballot.

 

CONFIRMATION HEARING

 

4.                                      Commencing on September 5, 2019 at 10:00 a.m. (prevailing Eastern Time), or as soon thereafter as counsel may be heard, a hearing (the “Confirmation Hearing”) will be held before the Honorable Martin Glenn, United States Bankruptcy Judge, in Courtroom 523 at the United States Bankruptcy Court for the Southern District of New York, 1 Bowling Green, New York, New York 10004 to consider confirmation of the Plan, as the same may be amended, modified or supplemented from time to time, and for such other and further relief as may be just or proper. The Confirmation Hearing may be adjourned from time to time without further notice to creditors or other parties in interest, other than by an announcement of such an adjournment in open court at the Confirmation Hearing or any adjournment thereof or the filing of a notice or other appropriate filing with the Bankruptcy Court. The Plan may be modified in accordance with the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, the Plan and other applicable law, without further notice, prior to or as a result of the Confirmation Hearing.

 

DEADLINE FOR OBJECTIONS TO CONFIRMATION OF THE PLAN

 

5.                                      Objections, if any, to confirmation of the Plan, including any supporting memoranda, must be in writing, filed with the Clerk of the Bankruptcy Court, together with proof of service, at One Bowling Green, New York, New York 10004, or electronically using the Bankruptcy Court’s Case Management/Electronic Case File (“CM/ECF”) System at https://ecf.nysb.uscourts.gov (a CM/ECF password will be required), in each case, with a hard copy delivered to the Judge’s Chambers, and must: (a) state the name and address of the objecting party and the amount of its claim or the nature of its interest in the Debtors’ chapter 11 cases; (b) state with particularity the provision or provisions of the Plan objected to and for any objection asserted, the legal and factual basis for such objections; (c) provide proposed language to remedy any objection asserted, if possible; and (d) be served by hand delivery or in a manner as will cause such objection to be received on or before August 22, 2019 at 4:00 p.m. (prevailing Eastern Time) by: (i) Aegerion Pharmaceuticals, Inc., 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142 (Attn: John R. Castellano); (ii) counsel to the Debtors, Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, NY 10019 (Attn: Paul V. Shalhoub, Esq. and Andrew S. Mordkoff, Esq.); (iii) counsel to those certain lenders under the Debtors’ debtor-in-possession financing facility, the Debtors’ prepetition secured bridge loan credit agreement and the Debtors’ 2% unsecured convertible notes, Latham & Watkins LLP, 330 North Wabash Avenue, Suite 2800, Chicago, IL 60611 (Attn: Richard A. Levy, Esq.) and King & Spalding LLP, 444 West Lake Street, Suite 1650, Chicago, IL 60606 (Attn: Matthew L. Warren, Esq.); (iv) counsel to the Official Committee of Unsecured Creditors, Kramer Levin Naftalis & Frankel LLP, 1177 Avenue of the Americas, New York, NY 10036 (Attn: Kenneth H. Eckstein, Esq. and Rachael Ringer, Esq.); (v) counsel to the United States Trustee for Region 2,

 

2

 

201 Varick Street, Suite 1006, New York, NY 10014 (Attn: Benjamin J. Higgins, Esq. and Brian S. Masumoto, Esq.); (vi) counsel to Novelion Therapeutics Inc., Goodwin Procter LLP, The New York Times Building, 620 Eighth Avenue, New York, NY 10018 (Attn: Gregory Fox, Esq. and Jacqueline Mercier, Esq.); and (vii) counsel to Amryt Pharma Plc, Gibson, Dunn & Crutcher LLP, 200 Park Avenue, New York, NY 10166 (Attn: Matthew J. Williams, Esq. and Jason Zachary Goldstein, Esq.). Any objections not filed and served as set forth above will be deemed waived.

 

	
Dated:  New York, New York
    	
 
    
	
July 11, 2019
    	
 
    
	
 
    	
 
    
	
 
    	
WILLKIE FARR &   GALLAGHER LLP
    
	
 
    	
Counsel   for the Debtors and Debtors in Possession
    
	
 
    	
 
    
	
 
    	
787 Seventh Avenue
    
	
 
    	
New York, New York   10019
    
	
 
    	
(212) 728-8000
    

 

3

 

Exhibit B-1

 

Class 3 Ballot (Bridge Loan Claims)

 

2

 

	
UNITED   STATES BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF   NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion   Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632   (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

BALLOT FOR CLASS 3 (BRIDGE LOAN CLAIMS) FOR

ACCEPTING OR REJECTING THE DEBTORS’ FIRST AMENDED

JOINT CHAPTER 11 PLAN

 

TO BE COUNTED, YOUR VOTE MUST BE ACTUALLY  RECEIVED BY THE SOLICITATION AGENT BY AUGUST 15, 2019, AT 4:00 P.M. (PREVAILING EASTERN TIME).

 

This ballot (the “Ballot”) is being submitted to you by Aegerion Pharmaceuticals, Inc. and Aegerion Pharmaceuticals Holdings, Inc. as debtors and debtors in possession in the above-captioned cases (the “Debtors”) to solicit your vote to accept or reject the Debtors’ First Amended Joint Chapter 11 Plan [Docket No. 180] (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Plan”).(2)

 

The Bankruptcy Court has approved the Debtors’ Disclosure Statement for First Amended Joint Chapter 11 Plan [Docket No. 182] (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Disclosure Statement”). The Disclosure Statement describes the Plan and provides information to assist you in deciding how to vote your Ballot. Bankruptcy Court approval of the Disclosure Statement does not indicate Bankruptcy Court approval of the Plan.

 

If you do not have a Disclosure Statement, you may obtain a copy free of charge on the dedicated webpage of Prime Clerk LLC, the Debtors’ court-approved solicitation agent (the “Solicitation Agent”) in these cases, at http://primeclerk.com/aegerion. A copy of the Disclosure Statement is also available: (a) at the Office of the Clerk of the Bankruptcy Court; (b) on the Bankruptcy Court’s website, http://www.nysb.uscourts.gov (a PACER account is required); (c) upon written request to the Solicitation Agent at Aegerion Pharmaceuticals, Inc. Ballot Processing Center, c/o Prime Clerk LLC, Grand Central Place, 60 East 42nd Street, Suite

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 Capitalized terms used in this Ballot that are not otherwise defined herein have the meanings given to them in the Plan.

 

 

1440, New York, NY 10165; or (d) by contacting the Solicitation Agent via telephone at 844-627-5368 or for international calls at 347-292-3524 or via email at aegerionballots@primeclerk.com.

 

IMPORTANT

 

You should review the Disclosure Statement and the Plan before you vote. You may wish to seek legal advice concerning the Plan and your classification and treatment under the Plan. Your Claim has been placed in Class 3 Bridge Loan Claims under the Plan. If you hold Claims in more than one Class under the Plan, you will receive a ballot for each Class in which you are entitled to vote.

 

If your Ballot is not actually received by the Balloting Agent on or before August 15, 2019 at 4:00 p.m. (prevailing Eastern Time), and such deadline is not extended, your vote will not count as either an acceptance or rejection of the Plan.

 

If the Plan is confirmed by the Bankruptcy Court it will be binding on you whether or not you vote.

 

Your receipt of this Ballot and the enclosed tax form does not signify that your Claim(s) has been or will be Allowed. The Debtors reserve all rights to dispute such Claim(s).

 

You may return your Ballot either (a) through Prime Clerk’s E-Ballot platform, located at http://cases.primeclerk.com/aegerion, or (b) by sending it and the enclosed tax form in the return envelope provided in your package to:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

If you submit your vote through the E-Ballot platform, you should not return a paper ballot. However, please return the enclosed tax form regardless of whether you vote through the E-Ballot platform as this will assist the Debtors in effectuating distributions to the extent you have an Allowed Claim.

 

2

 

HOW TO VOTE ONLINE THROUGH PRIME CLERK’S E-BALLOT PLATFORM

 

You may submit your ballot electronically by clicking on the “Submit E-Ballot” section on the Solicitation Agent’s website for these cases, located at http://cases.primeclerk.com/aegerion, and following the directions set forth on the website regarding submitting your E-Ballot as described more fully below.

 

1.                                      Please visit the Debtors’ voting website at http://cases.primeclerk.com/Aegerion.

 

2.                                      Click on the “E-Ballot” section of the Debtors’ voting website.

 

3.                                      Follow the directions to submit your E-Ballot. If you choose to submit your Ballot via Prime Clerk’s E-Ballot system, you should not return a hard copy of your Ballot.

 

IMPORTANT NOTE: YOU WILL NEED THE FOLLOWING INFORMATION TO RETRIEVE AND SUBMIT YOUR CUSTOMIZED E-BALLOT:

 

UNIQUE E-BALLOT ID#

 

PLEASE CHOOSE ONLY ONE METHOD OF RETURN FOR YOUR BALLOT. IF YOU CAST BOTH AN E-BALLOT AND A PAPER BALLOT WITH RESPECT TO THE SAME CLAIM, THE PAPER BALLOT WILL NOT BE COUNTED.

 

“E-BALLOTING” IS THE SOLE MANNER IN WHICH BALLOTS MAY BE DELIVERED VIA ELECTRONIC TRANSMISSION.

 

BALLOTS SUBMITTED BY FACSIMILE OR EMAIL WILL NOT BE COUNTED UNLESS APPROVED BY THE DEBTORS.

 

PLEASE RETURN THE ENCLOSED TAX FORM REGARDLESS OF WHETHER YOU VOTE THROUGH THE E-BALLOT PLATFORM AS THIS WILL ASSIST THE DEBTORS IN EFFECTUATING DISTRIBUTIONS TO THE EXTENT YOU HAVE AN ALLOWED CLAIM.

 

ACCEPTANCE OR REJECTION OF THE PLAN

 

Item 1.         Vote Amount.

 

For purposes of voting to accept or reject the Plan, as of 5:00 p.m. (prevailing Eastern Time) on July 11, 2019 (the “Voting Record Date”), the undersigned (the “Claimant”) was a holder of a Class 3 Bridge Loan Claim in the aggregate amount set forth below.

 

$

 

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Item 2.         Vote on Plan.

 

CHECK ONE BOX ONLY

 

o                                    ACCEPTS (votes FOR) the Plan.

 

o                                    REJECTS (votes AGAINST) the Plan.

 

IMPORTANT INFORMATION REGARDING THE RELEASES

 

Following confirmation, subject to Article XII of the Plan, the Plan will be substantially consummated on the Effective Date. Among other things, effective as of the Confirmation Date but subject to the occurrence of the Effective Date, certain release, injunction, exculpation and discharge provisions set forth in Article XII of the Plan will become effective. In determining how to cast your vote on the Plan, it is important to read the provisions contained in Article XII of the Plan very carefully so that you understand how confirmation and substantial consummation of the Plan — which effectuates such provisions — will affect you and any Claim(s) you may hold against the Debtors and/or certain other Released Parties specified in the Plan.(3)

 

Specifically, except as otherwise set forth in the Plan or Confirmation Order, the releases in Section 12.6 of the Plan (the “Releases”) bind (a) each holder of a Claim that voted to accept the Plan, (b) each Released Party, and (c) to the fullest extent permissible under applicable law, as such law may be extended or interpreted subject to the Effective Date, (i) all holders of a Claim who vote to reject the Plan and “opt in” to the Releases, (ii) all holders of a Claim or Interest who are not entitled to vote to accept or reject the Plan and “opt in” to the Releases, or (iii) all other holders of a Claim or Interest who elect to “opt in” to the Releases. The Releases provide for, among other things, the following:

 

Releases by the Debtors. Except as otherwise provided in the Plan or the Confirmation Order, as of the Effective Date, the Debtors, as, debtors in possession, and any person seeking

 

(3)                                 As used herein and in the Plan, the term “Released Parties” means, collectively, and each solely in its capacity as such: (a) the Debtors, their respective non-Debtor subsidiaries, and the Reorganized Debtors; (b) Novelion; (c) the DIP Administrative Agent and the DIP Lenders; (d) the Bridge Loan Administrative Agent; (e) the Convertible Notes Trustee; (f) the Bridge Loan Lenders; (g) the Consenting Lenders; (h) the members of the Ad Hoc Group; (i) the Plan Investor; (j) the Committee and each of its current and former members solely in their capacity as members of the Committee; (k) each of such parties’ respective predecessors, successors, assigns, subsidiaries, owners, affiliates, managed accounts, funds or funds under common management; and (l) each of the foregoing parties’ (described in clauses (a)-(k)) respective current and former officers, directors, managers, managing members, employees, members, principals, shareholders, agents, advisory board members, management companies, fund advisors, partners, attorneys, financial advisors or other professionals or representatives, together with their successors and assigns, in each case solely in their capacity as such; provided, however, that former directors, officers and employees of the Debtors shall not be deemed Released Parties; provided further that such attorneys and professional advisors shall only include those that provided services related to the Chapter 11 Cases and the transactions contemplated by the Plan (and do not include the attorneys and law firms retained by the Debtors in the ordinary course of business during these Chapter 11 Cases); provided, further, that no Person shall be a Released Party if it objects to the releases provided for in Article XII of the Plan.

 

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to exercise the rights of the Debtors’ Estates, including without limitation, any successor to the Debtors or any representative of the Debtors’ Estates appointed or selected pursuant to sections 1103, 1104 or 1123(b)(3) of the Bankruptcy Code or under chapter 7 of the Bankruptcy Code, shall be deemed to forever release, waive and discharge all claims (as such term “claim” is defined in section 101(5) of the Bankruptcy Code), obligations, suits, judgments, damages, demands, debts, rights, causes of action (including, but not limited to, the Causes of Action) and liabilities (other than the rights of the Debtors to enforce the Plan and the contracts, instruments, releases and other agreements or documents delivered thereunder) against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act, omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the purchase, sale or rescission of the purchase or sale of any security of the Debtors, the subject matter of, or the transactions or events giving rise to, any Claim or Interest that is treated in the Plan, the parties released pursuant to this Section 12.6, the Chapter 11 Cases, the RSA, the DIP Financing Agreement, the Plan Funding Agreement, or the Plan or the Disclosure Statement, and that could have been asserted by or on behalf of the Debtors or their Estates, whether directly, indirectly, derivatively or in any representative or any other capacity; provided, however, that in no event shall anything in this Section 12.06(a) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases in the Plan, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims released by the releases in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after reasonable investigation by the Debtors and after notice and opportunity for hearing; and (6) a bar to any of the Debtors asserting any claim released by the releases in the Plan against any of the Released Parties.

 

Third Party Releases. Except as otherwise provided in the Plan, the Plan Funding Agreement or the Confirmation Order, on the Effective Date each Releasing Party, in consideration for the obligations of the Debtors under the Plan, the distributions under the Plan and other contracts, instruments, releases, agreements or documents executed and delivered in connection with the Plan, will be deemed to have consented to the Plan and the restructuring embodied in the Plan for all purposes and deemed to forever release, waive and discharge all claims (as such term is defined in section 101(5) of the Bankruptcy Code), including but not limited to any claim sounding in law or equity or asserting a tort, breach of any duty or contract, violations of the common law, any federal or state statute, any federal or state securities laws or otherwise, demands, debts, rights, causes of action (including without limitation, the Causes of Action) or liabilities (other than the right to enforce the obligations of any party under the Plan and the contracts, instruments, releases, agreements and documents delivered under or in connection with the Plan), including, without limitation, any claims for any such loss such holder may suffer, have suffered or be alleged to suffer as a

 

5

 

result of the Debtors commencing the Chapter 11 Cases or as a result of the Plan being consummated, against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act or omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the Chapter 11 Cases, the Plan or the Disclosure Statement; provided, however, that in no event shall anything in this Section 12.06(b) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases of holders of Claims and Interests, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after notice and opportunity for hearing; and (6) a bar to any holder of a Claim or Interest asserting any Claim released by the releases in the Plan against any of the Released Parties.

 

Notwithstanding anything to the contrary contained in the Plan: (i) except to the extent permissible under applicable law, as such law may be extended or interpreted subsequent to the Effective Date, the releases provided for in this Section 12.06 of the Plan shall not release any non-Debtor entity from any liability arising under (a) the Internal Revenue Code or any state, city or municipal tax code, (b) any criminal laws of the United States or any state, city or municipality, or (c) any environmental laws of the United States or any state, city or municipal tax code; and (ii) the releases set forth in this Section 12.06 shall not release any (a) claims, right, or Causes of Action for money borrowed from or owed to the Debtors by any of their directors, officers or former employees, as set forth in the Debtors’ books and records, (b) any claims against any Person to the extent such Person asserts a crossclaim, counterclaim and/or claim for setoff which seeks affirmative relief against a Debtor or any of its officers, directors, or representatives, (c) claims against any Person arising from or relating to such Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order of the Bankruptcy Court, and (d) any Unimpaired Claims unless and until holders of Unimpaired Claims have received payment on account of such Claims that render such claims Unimpaired in accordance with the Plan.

 

Notwithstanding any language to the contrary contained in this Disclosure Statement, Plan, and/or the Confirmation Order, no provision of the Plan or the Confirmation Order shall (i) preclude the SEC from enforcing its police or regulatory powers; or (ii) enjoin, limit, impair, or delay the SEC from commencing or continuing any claims, causes of action, proceedings or investigations against any non-Debtor person or non-Debtor entity in any forum.

 

As to any Governmental Unit (as defined in section 101(27) of the Bankruptcy Code), nothing in the Plan, Plan Documents, or Confirmation Order shall limit or expand the scope of discharge, release or injunction to which the Debtors or Reorganized Debtors are entitled under the Bankruptcy Code, if any. The discharge, release, and injunction provisions

 

6

 

contained in the Plan, Plan Documents, or Confirmation Order are not intended and shall not be construed to bar any Governmental Unit from, subsequent to the Confirmation Order, pursuing any police or regulatory action.

 

Accordingly, notwithstanding anything contained in the Plan, Plan Documents, or Confirmation Order to the contrary, nothing in the Plan or Confirmation Order shall discharge, release, impair or otherwise preclude: (1) any liability to any Governmental Unit that is not a “claim” within the meaning of section 101(5) of the Bankruptcy Code; (2) any Claim of any Governmental Unit arising on or after the Confirmation Date; (3) any valid right of setoff or recoupment of any Governmental Unit against any of the Debtors; or (4) any liability of the Debtors or Reorganized Debtors under police or regulatory statutes or regulations to any Governmental Unit as the owner, lessor, lessee or operator of property that such entity owns, operates or leases after the Confirmation Date. Nor shall anything in the Plan, Plan Documents, or Confirmation Order: (i) enjoin or otherwise bar any Governmental Unit from asserting or enforcing, outside the Bankruptcy Court, any liability described in the preceding sentence; or (ii) divest any court, commission, or tribunal of jurisdiction to determine whether any liabilities asserted by any Governmental Unit are discharged or otherwise barred by the Plan, Plan Documents, Confirmation Order, or the Bankruptcy Code.

 

Moreover, nothing in the Plan, Plan Documents, or Confirmation Order shall release or exculpate any non-debtor, including any Released Parties and/or exculpated parties, from any liability to any Governmental Unit, including but not limited to any liabilities arising under the Internal Revenue Code, the environmental laws, or the criminal laws against the Released Parties and/or exculpated parties, nor shall anything in the Plan, Plan Documents, or Confirmation Order enjoin any Governmental Unit from bringing any claim, suit, action or other proceeding against any non-Debtor for any liability whatsoever; provided, however, that the foregoing sentence shall not limit the scope of discharge granted to the Debtors under sections 524 and 1141 of the Bankruptcy Code.

 

Nothing contained in the Plan, Plan Documents, or Confirmation Order shall be deemed to determine the tax liability of any person or entity, including but not limited to the Debtors and the Reorganized Debtors, nor shall the Plan, Plan Documents, or Confirmation Order be deemed to have determined the federal and/or state tax treatment of any item, distribution, or entity, including the federal and/or state tax consequences of the Plan and/or Plan Documents, nor shall anything in the Plan, Plan Documents, or Confirmation Order be deemed to have conferred jurisdiction upon the Bankruptcy Court to make determinations as to federal and/or state tax liability and federal and/or state tax treatment except as provided under 11 U.S.C. § 505.

 

Article X of the Plan regarding Executory Contracts and Unexpired Leases, and Section 7.8 of the Plan regarding Cancellation of Existing Securities and Agreements, shall not apply to the Government Settlement Agreements. The Government Settlement Agreements shall be unimpaired by the Plan, Plan Documents, and Confirmation Order, and shall remain obligations of the Debtors and/or the Reorganized Debtors, and all rights, obligations, and duties under the Government Settlement Agreements shall be preserved as if the Debtors’ bankruptcy cases were never filed. All Governmental Units reserve all rights with respect to the Government Settlement Agreements, and nothing contained in the Plan, Plan Documents,

 

7

 

or Confirmation Order shall discharge, release, impair, or otherwise preclude any liability to any Governmental Unit arising from or relating to the Government Settlement Agreements. Any amounts owed to Governmental Units under the Government Settlement Agreements shall be paid in full when due in the ordinary course and nothing in the Plan, Plan Documents, or Confirmation Order shall be interpreted to set cure amounts, authorize the assignment or rejection of any Government Settlement Agreement, or require any Governmental Unit to approve of and consent to the assignment of any Government Settlement Agreement. The Debtors and Reorganized Debtors expressly agree that any provisions regarding default in the Government Settlement Agreements shall continue to apply as set forth in those agreements, irrespective of any provisions of the Plan, Plan Documents, and Confirmation Order. For the avoidance of doubt, nothing contained in the Plan, Plan Documents, or Confirmation Order shall divest any court, commission, or tribunal of jurisdiction over any matters related to the Government Settlement Agreements, or confer on the Bankruptcy Court jurisdiction over any matter related to the Government Settlement Agreements. Notwithstanding anything to the contrary in this paragraph, the provisions of this paragraph are subject to the provisions of Section 5.5 of the Plan regarding acceleration or increase of the monetary obligations under the Government Settlement Agreements.

 

The governmental units that are parties to the Government Settlement Agreements have not at this time sought to accelerate or increase payments under those agreements as a result of the filing of these Chapter 11 Cases or the consummation of the transactions contemplated by the Plan and the Plan Documents. The Debtors and certain of the governmental units that are parties to the Government Settlement Agreements are in discussions regarding the intentions of those parties regarding acceleration of the Debtors’ payment obligations under the Government Settlement Agreements. The Debtors and these parties to the Government Settlement Agreements anticipate reaching resolution on this issue before the Plan is confirmed.

 

Item 3.         Opt-In Election (for holders of Class 3 Bridge Loan Claims that abstain from voting or vote to REJECT the Plan only)

 

If you did not vote to accept the Plan in Item 2, either because you abstained from voting on the Plan or voted to reject the Plan, you are still entitled to opt into the releases set forth in Article XII of the Plan by making such election below. DO NOT COMPLETE THE FOLLOWING ELECTION IF YOU VOTED TO ACCEPT THE PLAN IN ITEM 2. PURSUANT TO THE TERMS OF THE PLAN, IF YOU VOTE TO ACCEPT THE PLAN YOU WILL BE DEEMED TO HAVE CONSENTED TO THE RELEASES SET FORTH IN ARTICLE XII OF THE PLAN.

 

o                                    The undersigned elects to grant (OPTS IN TO) the Releases set forth in Section 12.6 of the Plan.

 

Item 4.         Certification.

 

By signing this Ballot, the undersigned Claimant hereby certifies that: (a) on the Voting Record Date, it was the holder of the Class 3 Bridge Loan Claim to which this Ballot pertains (or an authorized signatory for such holder); (b) it has full power and authority to vote to

 

8

 

accept or reject the Plan; and (c) it had received a copy of the Disclosure Statement (including all exhibits thereto) and other solicitation materials. The undersigned understands that an otherwise properly completed, executed and timely-returned Ballot that does not indicate either acceptance or rejection of the Plan or indicates both acceptance and rejection of the Plan will not be counted. By signing this Ballot, the undersigned is also certifying that its vote on the Plan is subject to all the terms and conditions set forth in the Plan and the Disclosure Statement.

 

	
Name of Claimant:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name (if different from   Claimant):
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title (if corporation   or partnership)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Dated:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Email:
    	
 
    	
 
    
						

 

PLEASE MAKE SURE YOU HAVE PROVIDED ALL INFORMATION REQUESTED IN THIS BALLOT. PLEASE READ AND FOLLOW THE INSTRUCTIONS SET FORTH BELOW CAREFULLY. PLEASE (A) SUBMIT YOUR BALLOT ELECTRONICALLY THROUGH THE SOLICITATION AGENT’S E-BALLOT PLATFORM, LOCATED AT HTTP://CASES.PRIMECLERK.COM/AEGERION AND RETURN YOUR TAX FORM TO THE SOLICITATION AGENT, OR (B) COMPLETE, SIGN AND DATE THIS BALLOT AND RETURN IT BY MAIL, HAND DELIVERY OR OVERNIGHT COURIER SO THAT IT IS RECEIVED BY THE SOLICITATION AGENT BY AUGUST 15, 2019 AT 4:00 P.M. (PREVAILING EASTERN TIME).

 

9

 

VOTING INSTRUCTIONS

 

1.                                      In order for your vote to count, you must:

 

(i)                                     In the boxes provided in Item 2 of the Ballot, indicate either acceptance or rejection of the Plan by checking the appropriate box; and

 

(ii)                                  Review and sign the certifications in Item 4 of the Ballot. Please be sure to sign and date your Ballot. Your original signature is required if you are voting by paper ballot in order for your vote to be counted. If you are completing the Ballot on behalf of an entity, indicate your relationship with such entity and the capacity in which you are signing, and if requested, provide proof of your authorization to so sign. In addition, please provide your name and mailing address if different from that set forth on the attached mailing label or if no such mailing label is attached to the Ballot.

 

2.                                      If you abstained from voting or voted to reject the Plan, review the opt-in election disclosure in Item 3 of the Ballot, and determine whether you will check the box to opt into the Plan’s release provisions by checking the box in Item 3.

 

3.                                      To have your vote counted, you must (a) submit your ballot electronically through the Solicitation Agent’s E-Ballot platform, located at http://cases.primeclerk.com/aegerion, or (b) complete, sign and return this paper Ballot so that it is actually  received by the Solicitation Agent not later than 4:00 p.m. (prevailing Eastern Time) on August 15, 2019. A PREPAID ENVELOPE ADDRESSED TO THE SOLICITATION AGENT IS ENCLOSED FOR YOUR CONVENIENCE. Return the completed Ballot and your tax form to:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

Or via e-ballot at cases.primeclerk.com/aegerion

 

4.                                      DO NOT SUBMIT YOUR BALLOT BY FAX OR EMAIL. A ballot submitted by facsimile or email will not be counted unless approved by the Debtors.

 

5.                                      A properly completed, executed and timely-returned Ballot that either (a) indicates both an acceptance and rejection of the Plan, or (b) fails to indicate either an acceptance or rejection of the Plan will not be counted.

 

10

 

6.                                      If you hold Claims in more than one voting Class under the Plan, you should receive a ballot for each such category of Claims, coded by Class number and description, and a set of solicitation materials with respect to each such Claim. Each ballot you receive is for voting only your Claim described in that ballot. Please complete and return each ballot you receive. The attached Ballot is designated only for voting Class 3 Bridge Loan Claims.

 

7.                                      You must vote all your Claims within a single Class under the Plan either to accept or reject the Plan. Accordingly, a Ballot (or multiple Ballots with respect to multiple Claims within a single Class) that partially rejects and partially accepts the Plan will not be counted.

 

8.                                      If you cast more than one Ballot voting the same Claim prior to the Voting Deadline, the last valid Ballot timely received shall be deemed to reflect the voter’s intent and shall supersede and revoke any earlier received Ballot. If you simultaneously cast inconsistent duplicate Ballots with respect to the same Claim, such Ballots shall not be counted.

 

9.                                      Any Ballot that is illegible or that contains insufficient information to permit the identification of the claimant will not be counted.

 

10.                               This Ballot does not constitute, and shall not be deemed to be, a proof of claim or equity interest or an assertion or admission of a Claim or an Interest.

 

11.                               Subject to the requirements of, and compliance with, Bankruptcy Rule 3018, if you have delivered a valid Ballot for the acceptance or rejection of the Plan, you may withdraw such acceptance or rejection by delivering a written notice of withdrawal to the Balloting Agent at any time prior to the Voting Deadline. A notice of withdrawal, to be valid, must (i) describe the Claim, (ii) be signed by the creditor in the same manner as the Ballot was originally signed, and (iii) be received by the Balloting Agent on or before the Voting Deadline. The Debtors reserve the absolute right to contest the validity of any such withdrawals of Ballots.

 

12.                               It is important that you vote. The Plan can be confirmed by the Bankruptcy Court and thereby made binding on you if it is accepted by the holders of at least two-thirds in amount and one-half in number of the Claims in each impaired Class who vote on the Plan and if the Plan otherwise satisfies the applicable requirements of section 1129(a) of title 11 of the United States Code (the “Bankruptcy Code”). The votes of Claims actually voted in your Class will bind both those who vote and those who do not vote. If the requisite acceptances are not obtained, the Bankruptcy Court nonetheless may confirm the Plan if it finds that the Plan: (a) provides fair and equitable treatment to, and does not unfairly discriminate against, the Class or Classes voting to reject the Plan; and (b) otherwise satisfies the requirements of section 1129(b) of the Bankruptcy Code.

 

13.                               This Ballot is not a letter of transmittal and may not be used for any purposes other than to cast a vote to accept or reject the Plan. Holders should not surrender, at this time, certificates (if any) representing their securities. No party will accept delivery of any such certificates surrendered together with this Ballot.

 

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14.                               NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR ADVICE, OR TO MAKE ANY REPRESENTATION, OTHER THAN WHAT IS CONTAINED IN THE MATERIALS MAILED WITH THIS BALLOT OR OTHER SOLICITATION MATERIALS APPROVED BY THE BANKRUPTCY COURT, INCLUDING, WITHOUT LIMITATION, THE DISCLOSURE STATEMENT.

 

15.                               PLEASE RETURN YOUR BALLOT AND TAX FORM PROMPTLY.

 

IF YOU HAVE ANY QUESTIONS REGARDING THIS BALLOT OR THE PROCEDURES GENERALLY, OR IF YOU NEED ADDITIONAL COPIES OF THE BALLOT OR OTHER ENCLOSED MATERIALS, PLEASE CONTACT YOUR NOMINEE, OR PRIME CLERK AT 844-627-5368 OR FOR INTERNATIONAL CALLS AT 347-292-3524 OR VIA EMAIL AT AEGERIONBALLOTS@PRIMECLERK.COM.

 

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UNITED   STATES BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF   NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion   Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632   (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

BALLOT FOR CLASS 4 (NOVELION INTERCOMPANY LOAN CLAIMS)

FOR ACCEPTING OR REJECTING THE DEBTORS’ FIRST AMENDED

JOINT CHAPTER 11 PLAN

 

TO BE COUNTED, YOUR VOTE MUST BE ACTUALLY  RECEIVED BY THE SOLICITATION AGENT BY AUGUST 15, 2019, AT 4:00 P.M. (PREVAILING EASTERN TIME).

 

This ballot (the “Ballot”) is being submitted to you by Aegerion Pharmaceuticals, Inc. and Aegerion Pharmaceuticals Holdings, Inc. as debtors and debtors in possession in the above-captioned cases (the “Debtors”) to solicit your vote to accept or reject the Debtors’ First Amended Joint Chapter 11 Plan [Docket No. 180] (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Plan”).(2)

 

The Bankruptcy Court has approved the Debtors’ Disclosure Statement for First Amended Joint Chapter 11 Plan [Docket No. 182]. (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Disclosure Statement”). The Disclosure Statement describes the Plan and provides information to assist you in deciding how to vote your Ballot. Bankruptcy Court approval of the Disclosure Statement does not indicate Bankruptcy Court approval of the Plan.

 

If you do not have a Disclosure Statement, you may obtain a copy free of charge on the dedicated webpage of Prime Clerk LLC, the Debtors’ court-approved solicitation agent (the “Solicitation Agent”) in these cases, at http://primeclerk.com/aegerion. A copy of the Disclosure Statement is also available: (a) at the Office of the Clerk of the Bankruptcy Court; (b) on the Bankruptcy Court’s website, http://www.nysb.uscourts.gov (a PACER account is required); (c) upon written request to the Solicitation Agent at Aegerion Pharmaceuticals, Inc. Ballot Processing Center, c/o Prime Clerk LLC, One Grand Central Place, 60 East 42nd, Suite

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 Capitalized terms used in this Ballot that are not otherwise defined herein have the meanings given to them in the Plan.

 

 

1440, New York, NY 10165; or (d) by contacting the Solicitation Agent via telephone at 844-627-5368 or for international calls at 347-292-3524 or via email at aegerionballots@primeclerk.com.

 

IMPORTANT

 

You should review the Disclosure Statement and the Plan before you vote. You may wish to seek legal advice concerning the Plan and your classification and treatment under the Plan. Your Claim has been placed in Class 4 Novelion Intercompany Loan Claims under the Plan. If you hold Claims in more than one Class under the Plan, you will receive a ballot for each Class in which you are entitled to vote.

 

If your Ballot is not actually received by the Balloting Agent on or before August 15, 2019 at 4:00 p.m. (prevailing Eastern Time), and such deadline is not extended, your vote will not count as either an acceptance or rejection of the Plan.

 

If the Plan is confirmed by the Bankruptcy Court it will be binding on you whether or not you vote.

 

Your receipt of this Ballot and the enclosed tax form does not signify that your Claim(s) has been or will be Allowed. The Debtors reserve all rights to dispute such Claim(s).

 

You may return your Ballot either (a) through Prime Clerk’s E-Ballot platform, located at http://cases.primeclerk.com/aegerion, or (b) by sending it and the enclosed tax form in the return envelope provided in your package to:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

If you submit your vote through the E-Ballot platform, you should not return a paper ballot. However, please return the enclosed tax form regardless of whether you vote through the E-Ballot platform as this will assist the Debtors in effectuating distributions to the extent you have an Allowed Claim.

 

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HOW TO VOTE ONLINE THROUGH PRIME CLERK’S E-BALLOT PLATFORM

 

You may submit your ballot electronically by clicking on the “Submit E-Ballot” section on the Solicitation Agent’s website for these cases, located at http://cases.primeclerk.com/aegerion, and following the directions set forth on the website regarding submitting your E-Ballot as described more fully below.

 

1.                                      Please visit the Debtors’ voting website at http://cases.primeclerk.com/aegerion.

 

2.                                      Click on the “E-Ballot” section of the Debtors’ voting website.

 

3.                                      Follow the directions to submit your E-Ballot. If you choose to submit your Ballot via Prime Clerk’s E-Ballot system, you should not return a hard copy of your Ballot.

 

IMPORTANT NOTE: YOU WILL NEED THE FOLLOWING INFORMATION TO RETRIEVE AND SUBMIT YOUR CUSTOMIZED E-BALLOT:

 

UNIQUE E-BALLOT ID#

 

PLEASE CHOOSE ONLY ONE METHOD OF RETURN FOR YOUR BALLOT. IF YOU CAST BOTH AN E-BALLOT AND A PAPER BALLOT WITH RESPECT TO THE SAME CLAIM, THE PAPER BALLOT WILL NOT BE COUNTED.

 

“E-BALLOTING” IS THE SOLE MANNER IN WHICH BALLOTS MAY BE DELIVERED VIA ELECTRONIC TRANSMISSION.

 

BALLOTS SUBMITTED BY FACSIMILE OR EMAIL WILL NOT BE COUNTED UNLESS APPROVED BY THE DEBTORS.

 

PLEASE RETURN THE ENCLOSED TAX FORM REGARDLESS OF WHETHER YOU VOTE THROUGH THE E-BALLOT PLATFORM AS THIS WILL ASSIST THE DEBTORS IN EFFECTUATING DISTRIBUTIONS TO THE EXTENT YOU HAVE AN ALLOWED CLAIM.

 

ACCEPTANCE OR REJECTION OF THE PLAN

 

Item 1.         Vote Amount.

 

For purposes of voting to accept or reject the Plan, as of 5:00 p.m. (prevailing Eastern Time) on July 11, 2019 (the “Voting Record Date”), the undersigned (the “Claimant”) was a holder of a Class 4 Novelion Intercompany Loan Claim in the aggregate amount set forth below.

 

$

 

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Item 2.         Vote on Plan.

 

CHECK ONE BOX ONLY

 

o                                    ACCEPTS (votes FOR) the Plan.

 

o                                    REJECTS (votes AGAINST) the Plan.

 

IMPORTANT INFORMATION REGARDING THE RELEASES

 

Following confirmation, subject to Article XII of the Plan, the Plan will be substantially consummated on the Effective Date. Among other things, effective as of the Confirmation Date but subject to the occurrence of the Effective Date, certain release, injunction, exculpation and discharge provisions set forth in Article XII of the Plan will become effective. In determining how to cast your vote on the Plan, it is important to read the provisions contained in Article XII of the Plan very carefully so that you understand how confirmation and substantial consummation of the Plan — which effectuates such provisions — will affect you and any Claim(s) you may hold against the Debtors and/or certain other Released Parties specified in the Plan.(3)

 

Specifically, except as otherwise set forth in the Plan or Confirmation Order, the releases in Section 12.6 of the Plan (the “Releases”) bind (a) each holder of a Claim that voted to accept the Plan, (b) each Released Party, and (c) to the fullest extent permissible under applicable law, as such law may be extended or interpreted subject to the Effective Date, (i) all holders of a Claim who vote to reject the Plan and “opt in” to the Releases, (ii) all holders of a Claim or Interest who are not entitled to vote to accept or reject the Plan and “opt in” to the Releases, or (iii) all other holders of a Claim or Interest who elect to “opt in” to the Releases. The Releases provide for, among other things, the following:

 

Releases by the Debtors. Except as otherwise provided in the Plan or the Confirmation Order, as of the Effective Date, the Debtors, as, debtors in possession, and any person seeking

 

(3)                                 As used herein and in the Plan, the term “Released Parties” means, collectively, and each solely in its capacity as such: (a) the Debtors, their respective non-Debtor subsidiaries, and the Reorganized Debtors; (b) Novelion; (c) the DIP Administrative Agent and the DIP Lenders; (d) the Bridge Loan Administrative Agent; (e) the Convertible Notes Trustee; (f) the Bridge Loan Lenders; (g) the Consenting Lenders; (h) the members of the Ad Hoc Group; (i) the Plan Investor; (j) the Committee and each of its current and former members solely in their capacity as members of the Committee; (k) each of such parties’ respective predecessors, successors, assigns, subsidiaries, owners, affiliates, managed accounts, funds or funds under common management; and (l) each of the foregoing parties’ (described in clauses (a)-(k)) respective current and former officers, directors, managers, managing members, employees, members, principals, shareholders, agents, advisory board members, management companies, fund advisors, partners, attorneys, financial advisors or other professionals or representatives, together with their successors and assigns, in each case solely in their capacity as such; provided, however, that former directors, officers and employees of the Debtors shall not be deemed Released Parties; provided  further that such attorneys and professional advisors shall only include those that provided services related to the Chapter 11 Cases and the transactions contemplated by this Plan (and do not include the attorneys and law firms retained by the Debtors in the ordinary course of business during these Chapter 11 Cases); provided, further, that no Person shall be a Released Party if it objects to the releases provided for in Article XII of this Plan.

 

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to exercise the rights of the Debtors’ Estates, including without limitation, any successor to the Debtors or any representative of the Debtors’ Estates appointed or selected pursuant to sections 1103, 1104 or 1123(b)(3) of the Bankruptcy Code or under chapter 7 of the Bankruptcy Code, shall be deemed to forever release, waive and discharge all claims (as such term “claim” is defined in section 101(5) of the Bankruptcy Code), obligations, suits, judgments, damages, demands, debts, rights, causes of action (including, but not limited to, the Causes of Action) and liabilities (other than the rights of the Debtors to enforce the Plan and the contracts, instruments, releases and other agreements or documents delivered thereunder) against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act, omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the purchase, sale or rescission of the purchase or sale of any security of the Debtors, the subject matter of, or the transactions or events giving rise to, any Claim or Interest that is treated in the Plan, the parties released pursuant to this Section 12.6, the Chapter 11 Cases, the RSA, the DIP Financing Agreement, the Plan Funding Agreement, or the Plan or the Disclosure Statement, and that could have been asserted by or on behalf of the Debtors or their Estates, whether directly, indirectly, derivatively or in any representative or any other capacity; provided, however, that in no event shall anything in this Section 12.06(a) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases in the Plan, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims released by the releases in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after reasonable investigation by the Debtors and after notice and opportunity for hearing; and (6) a bar to any of the Debtors asserting any claim released by the releases in the Plan against any of the Released Parties.

 

Third Party Releases. Except as otherwise provided in the Plan, the Plan Funding Agreement or the Confirmation Order, on the Effective Date each Releasing Party, in consideration for the obligations of the Debtors under the Plan, the distributions under the Plan and other contracts, instruments, releases, agreements or documents executed and delivered in connection with the Plan, will be deemed to have consented to the Plan and the restructuring embodied in the Plan for all purposes and deemed to forever release, waive and discharge all claims (as such term is defined in section 101(5) of the Bankruptcy Code), including but not limited to any claim sounding in law or equity or asserting a tort, breach of any duty or contract, violations of the common law, any federal or state statute, any federal or state securities laws or otherwise, demands, debts, rights, causes of action (including without limitation, the Causes of Action) or liabilities (other than the right to enforce the obligations of any party under the Plan and the contracts, instruments, releases, agreements and documents delivered under or in connection with the Plan), including, without limitation, any claims for any such loss such holder may suffer, have suffered or be alleged to suffer as a

 

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result of the Debtors commencing the Chapter 11 Cases or as a result of the Plan being consummated, against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act or omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the Chapter 11 Cases, the Plan or the Disclosure Statement; provided, however, that in no event shall anything in this Section 12.06(b) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases of holders of Claims and Interests, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after notice and opportunity for hearing; and (6) a bar to any holder of a Claim or Interest asserting any Claim released by the releases in the Plan against any of the Released Parties.

 

Notwithstanding anything to the contrary contained in the Plan: (i) except to the extent permissible under applicable law, as such law may be extended or interpreted subsequent to the Effective Date, the releases provided for in this Section 12.06 of the Plan shall not release any non-Debtor entity from any liability arising under (a) the Internal Revenue Code or any state, city or municipal tax code, (b) any criminal laws of the United States or any state, city or municipality, or (c) any environmental laws of the United States or any state, city or municipal tax code; and (ii) the releases set forth in this Section 12.06 shall not release any (a) claims, right, or Causes of Action for money borrowed from or owed to the Debtors by any of their directors, officers or former employees, as set forth in the Debtors’ books and records, (b) any claims against any Person to the extent such Person asserts a crossclaim, counterclaim and/or claim for setoff which seeks affirmative relief against a Debtor or any of its officers, directors, or representatives, (c) claims against any Person arising from or relating to such Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order of the Bankruptcy Court, and (d) any Unimpaired Claims unless and until holders of Unimpaired Claims have received payment on account of such Claims that render such claims Unimpaired in accordance with the Plan.

 

Notwithstanding any language to the contrary contained in this Disclosure Statement, Plan, and/or the Confirmation Order, no provision of the Plan or the Confirmation Order shall (i) preclude the SEC from enforcing its police or regulatory powers; or (ii) enjoin, limit, impair, or delay the SEC from commencing or continuing any claims, causes of action, proceedings or investigations against any non-Debtor person or non-Debtor entity in any forum.

 

As to any Governmental Unit (as defined in section 101(27) of the Bankruptcy Code), nothing in the Plan, Plan Documents, or Confirmation Order shall limit or expand the scope of discharge, release or injunction to which the Debtors or Reorganized Debtors are entitled under the Bankruptcy Code, if any. The discharge, release, and injunction provisions

 

6

 

contained in the Plan, Plan Documents, or Confirmation Order are not intended and shall not be construed to bar any Governmental Unit from, subsequent to the Confirmation Order, pursuing any police or regulatory action.

 

Accordingly, notwithstanding anything contained in the Plan, Plan Documents, or Confirmation Order to the contrary, nothing in the Plan or Confirmation Order shall discharge, release, impair or otherwise preclude: (1) any liability to any Governmental Unit that is not a “claim” within the meaning of section 101(5) of the Bankruptcy Code; (2) any Claim of any Governmental Unit arising on or after the Confirmation Date; (3) any valid right of setoff or recoupment of any Governmental Unit against any of the Debtors; or (4) any liability of the Debtors or Reorganized Debtors under police or regulatory statutes or regulations to any Governmental Unit as the owner, lessor, lessee or operator of property that such entity owns, operates or leases after the Confirmation Date. Nor shall anything in the Plan, Plan Documents, or Confirmation Order: (i) enjoin or otherwise bar any Governmental Unit from asserting or enforcing, outside the Bankruptcy Court, any liability described in the preceding sentence; or (ii) divest any court, commission, or tribunal of jurisdiction to determine whether any liabilities asserted by any Governmental Unit are discharged or otherwise barred by the Plan, Plan Documents, Confirmation Order, or the Bankruptcy Code.

 

Moreover, nothing in the Plan, Plan Documents, or Confirmation Order shall release or exculpate any non-debtor, including any Released Parties and/or exculpated parties, from any liability to any Governmental Unit, including but not limited to any liabilities arising under the Internal Revenue Code, the environmental laws, or the criminal laws against the Released Parties and/or exculpated parties, nor shall anything in the Plan, Plan Documents, or Confirmation Order enjoin any Governmental Unit from bringing any claim, suit, action or other proceeding against any non-Debtor for any liability whatsoever; provided, however, that the foregoing sentence shall not limit the scope of discharge granted to the Debtors under sections 524 and 1141 of the Bankruptcy Code.

 

Nothing contained in the Plan, Plan Documents, or Confirmation Order shall be deemed to determine the tax liability of any person or entity, including but not limited to the Debtors and the Reorganized Debtors, nor shall the Plan, Plan Documents, or Confirmation Order be deemed to have determined the federal and/or state tax treatment of any item, distribution, or entity, including the federal and/or state tax consequences of the Plan and/or Plan Documents, nor shall anything in the Plan, Plan Documents, or Confirmation Order be deemed to have conferred jurisdiction upon the Bankruptcy Court to make determinations as to federal and/or state tax liability and federal and/or state tax treatment except as provided under 11 U.S.C. § 505.

 

Article X of the Plan regarding Executory Contracts and Unexpired Leases, and Section 7.8 of the Plan regarding Cancellation of Existing Securities and Agreements, shall not apply to the Government Settlement Agreements. The Government Settlement Agreements shall be unimpaired by the Plan, Plan Documents, and Confirmation Order, and shall remain obligations of the Debtors and/or the Reorganized Debtors, and all rights, obligations, and duties under the Government Settlement Agreements shall be preserved as if the Debtors’ bankruptcy cases were never filed. All Governmental Units reserve all rights with respect to the Government Settlement Agreements, and nothing contained in the Plan, Plan Documents,

 

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or Confirmation Order shall discharge, release, impair, or otherwise preclude any liability to any Governmental Unit arising from or relating to the Government Settlement Agreements. Any amounts owed to Governmental Units under the Government Settlement Agreements shall be paid in full when due in the ordinary course and nothing in the Plan, Plan Documents, or Confirmation Order shall be interpreted to set cure amounts, authorize the assignment or rejection of any Government Settlement Agreement, or require any Governmental Unit to approve of and consent to the assignment of any Government Settlement Agreement. The Debtors and Reorganized Debtors expressly agree that any provisions regarding default in the Government Settlement Agreements shall continue to apply as set forth in those agreements, irrespective of any provisions of the Plan, Plan Documents, and Confirmation Order. For the avoidance of doubt, nothing contained in the Plan, Plan Documents, or Confirmation Order shall divest any court, commission, or tribunal of jurisdiction over any matters related to the Government Settlement Agreements, or confer on the Bankruptcy Court jurisdiction over any matter related to the Government Settlement Agreements. Notwithstanding anything to the contrary in this paragraph, the provisions of this paragraph are subject to the provisions of Section 5.5 of the Plan regarding acceleration or increase of the monetary obligations under the Government Settlement Agreements.

 

The governmental units that are parties to the Government Settlement Agreements have not at this time sought to accelerate or increase payments under those agreements as a result of the filing of these Chapter 11 Cases or the consummation of the transactions contemplated by the Plan and the Plan Documents. The Debtors and certain of the governmental units that are parties to the Government Settlement Agreements are in discussions regarding the intentions of those parties regarding acceleration of the Debtors’ payment obligations under the Government Settlement Agreements. The Debtors and these parties to the Government Settlement Agreements anticipate reaching resolution on this issue before the Plan is confirmed.

 

Item 3.         Opt-In Election (for holders of Class 4 Novelion Intercompany Loan Claims that abstain from voting or vote to REJECT the Plan only)

 

If you did not vote to accept the Plan in Item 2, either because you abstained from voting on the Plan or voted to reject the Plan, you are still entitled to opt into the releases set forth in Article XII of the Plan by making such election below. DO NOT COMPLETE THE FOLLOWING ELECTION IF YOU VOTED TO ACCEPT THE PLAN IN ITEM 2. PURSUANT TO THE TERMS OF THE PLAN, IF YOU VOTE TO ACCEPT THE PLAN YOU WILL BE DEEMED TO HAVE CONSENTED TO THE RELEASES SET FORTH IN ARTICLE XII OF THE PLAN.

 

o                                    The undersigned elects to grant (OPTS IN TO) the Releases set forth in Section 12.6 of the Plan.

 

Item 4.         Certification.

 

By signing this Ballot, the undersigned Claimant hereby certifies that: (a) on the Voting Record Date, it was the holder of the Class 4 Novelion Intercompany Loan Claim to which this Ballot pertains (or an authorized signatory for such holder); (b) it has full power and

 

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authority to vote to accept or reject the Plan; and (c) it had received a copy of the Disclosure Statement (including all exhibits thereto) and other solicitation materials. The undersigned understands that an otherwise properly completed, executed and timely-returned Ballot that does not indicate either acceptance or rejection of the Plan or indicates both acceptance and rejection of the Plan will not be counted. By signing this Ballot, the undersigned is also certifying that its vote on the Plan is subject to all the terms and conditions set forth in the Plan and the Disclosure Statement.

 

	
Name of Claimant:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name (if different from   Claimant):
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title (if corporation   or partnership)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Dated:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Email:
    	
 
    	
 
    
						

 

PLEASE MAKE SURE YOU HAVE PROVIDED ALL INFORMATION REQUESTED IN THIS BALLOT. PLEASE READ AND FOLLOW THE INSTRUCTIONS SET FORTH BELOW CAREFULLY. PLEASE (A) SUBMIT YOUR BALLOT ELECTRONICALLY THROUGH THE SOLICITATION AGENT’S E-BALLOT PLATFORM, LOCATED AT HTTP://CASES.PRIMECLERK.COM/AEGERION AND RETURN YOUR TAX FORM TO THE SOLICITATION AGENT, OR (B) COMPLETE, SIGN AND DATE THIS BALLOT AND RETURN IT BY MAIL, HAND DELIVERY OR OVERNIGHT COURIER SO THAT IT IS RECEIVED BY THE SOLICITATION AGENT BY AUGUST 15, 2019 AT 4:00 P.M. (PREVAILING EASTERN TIME).

 

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VOTING INSTRUCTIONS

 

1.                                      In order for your vote to count, you must:

 

(i)                                     In the boxes provided in Item 2 of the Ballot, indicate either acceptance or rejection of the Plan by checking the appropriate box; and

 

(ii)                                  Review and sign the certifications in Item 4 of the Ballot. Please be sure to sign and date your Ballot. Your original signature is required if you are voting by paper ballot in order for your vote to be counted. If you are completing the Ballot on behalf of an entity, indicate your relationship with such entity and the capacity in which you are signing, and if requested, provide proof of your authorization to so sign. In addition, please provide your name and mailing address if different from that set forth on the attached mailing label or if no such mailing label is attached to the Ballot.

 

2.                                      If you abstained from voting or voted to reject the Plan, review the opt-in election disclosure in Item 3 of the Ballot, and determine whether you will check the box to opt into the Plan’s release provisions by checking the box in Item 3.

 

3.                                      To have your vote counted, you must (a) submit your ballot electronically through the Solicitation Agent’s E-Ballot platform, located at http://cases.primeclerk.com/aegerion, or (b) complete, sign and return this paper Ballot so that it is actually  received by the Solicitation Agent not later than 4:00 p.m. (prevailing Eastern Time) on August 15, 2019. A PREPAID ENVELOPE ADDRESSED TO THE SOLICITATION AGENT IS ENCLOSED FOR YOUR CONVENIENCE. Return the completed Ballot and your tax form to:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

4.                                      DO NOT SUBMIT YOUR BALLOT BY FAX OR EMAIL. A ballot submitted by facsimile or email will not be counted unless approved by the Debtors.

 

5.                                      A properly completed, executed and timely-returned Ballot that either (a) indicates both an acceptance and rejection of the Plan, or (b) fails to indicate either an acceptance or rejection of the Plan will not be counted.

 

6.                                      If you hold Claims in more than one voting Class under the Plan, you should receive a ballot for each such category of Claims, coded by Class number and description, and a set

 

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of solicitation materials with respect to each such Claim. Each ballot you receive is for voting only your Claim described in that ballot. Please complete and return each ballot you receive. The attached Ballot is designated only for voting Class 4 Novelion Intercompany Loan Claims.

 

7.                                      You must vote all your Claims within a single Class under the Plan either to accept or reject the Plan. Accordingly, a Ballot (or multiple Ballots with respect to multiple Claims within a single Class) that partially rejects and partially accepts the Plan will not be counted.

 

8.                                      If you cast more than one Ballot voting the same Claim prior to the Voting Deadline, the last valid Ballot timely received shall be deemed to reflect the voter’s intent and shall supersede and revoke any earlier received Ballot. If you simultaneously cast inconsistent duplicate Ballots with respect to the same Claim, such Ballots shall not be counted.

 

9.                                      Any Ballot that is illegible or that contains insufficient information to permit the identification of the claimant will not be counted.

 

10.                               This Ballot does not constitute, and shall not be deemed to be, a proof of claim or equity interest or an assertion or admission of a Claim or an Interest.

 

11.                               Subject to the requirements of, and compliance with, Bankruptcy Rule 3018, if you have delivered a valid Ballot for the acceptance or rejection of the Plan, you may withdraw such acceptance or rejection by delivering a written notice of withdrawal to the Balloting Agent at any time prior to the Voting Deadline. A notice of withdrawal, to be valid, must (i) describe the Claim, (ii) be signed by the creditor in the same manner as the Ballot was originally signed, and (iii) be received by the Balloting Agent on or before the Voting Deadline. The Debtors reserve the absolute right to contest the validity of any such withdrawals of Ballots.

 

12.                               It is important that you vote. The Plan can be confirmed by the Bankruptcy Court and thereby made binding on you if it is accepted by the holders of at least two-thirds in amount and one-half in number of the Claims in each impaired Class who vote on the Plan and if the Plan otherwise satisfies the applicable requirements of section 1129(a) of title 11 of the United States Code (the “Bankruptcy Code”). The votes of Claims actually voted in your Class will bind both those who vote and those who do not vote. If the requisite acceptances are not obtained, the Bankruptcy Court nonetheless may confirm the Plan if it finds that the Plan: (a) provides fair and equitable treatment to, and does not unfairly discriminate against, the Class or Classes voting to reject the Plan; and (b) otherwise satisfies the requirements of section 1129(b) of the Bankruptcy Code.

 

13.                               This Ballot is not a letter of transmittal and may not be used for any purposes other than to cast a vote to accept or reject the Plan. Holders should not surrender, at this time, certificates (if any) representing their securities. No party will accept delivery of any such certificates surrendered together with this Ballot.

 

14.                               NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR ADVICE, OR TO MAKE ANY REPRESENTATION, OTHER THAN WHAT IS

 

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CONTAINED IN THE MATERIALS MAILED WITH THIS BALLOT OR OTHER SOLICITATION MATERIALS APPROVED BY THE BANKRUPTCY COURT, INCLUDING, WITHOUT LIMITATION, THE DISCLOSURE STATEMENT.

 

15.                               PLEASE RETURN YOUR BALLOT AND TAX FORM PROMPTLY.

 

IF YOU HAVE ANY QUESTIONS REGARDING THIS BALLOT OR THE PROCEDURES GENERALLY, OR IF YOU NEED ADDITIONAL COPIES OF THE BALLOT OR OTHER ENCLOSED MATERIALS, PLEASE CONTACT YOUR NOMINEE, OR PRIME CLERK AT 844-627-5368 OR FOR INTERNATIONAL CALLS AT 347-292-3524 OR VIA EMAIL AT AEGERIONBALLOTS@PRIMECLERK.COM.

 

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UNITED   STATES BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF   NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion   Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632   (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

MASTER BALLOT FOR CONVERTIBLE

NOTEHOLDERS IN CLASS 6B (OTHER GENERAL

UNSECURED CLAIMS) FOR ACCEPTING OR REJECTING

THE DEBTORS’ FIRST AMENDED JOINT CHAPTER 11 PLAN

 

For use by brokers, banks, commercial banks, transfer agents, trust companies, dealers, or other agents or nominees for beneficial holders of Aegerion Pharmaceuticals, Inc.’s 2.00% Convertible Senior Unsecured Notes due 2019 (the “Convertible Notes”).

 

THE VOTING DEADLINE BY WHICH YOUR MASTER BALLOT MUST BE RECEIVED BY THE SOLICITATION AGENT IS 4:00 P.M. (PREVAILING EASTERN TIME) ON AUGUST 15, 2019 (THE “VOTING DEADLINE”) OR THE VOTES REPRESENTED BY YOUR MASTER BALLOT WILL NOT BE COUNTED.

 

This master ballot (the “Master Ballot”) is to be used by you, as a broker, bank, commercial bank, transfer agent, trust company, dealer or other agent or nominee (each of the foregoing, a “Nominee”), for summarizing the votes cast by beneficial holders of Class 6B Other General Unsecured Claims related to the Convertible Notes to accept or reject the Debtors’ First Amended Joint Chapter 11 Plan (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Plan”),(2) filed by Aegerion Pharmaceuticals, Inc. and Aegerion Pharmaceuticals Holdings, Inc. as debtors and debtors in possession in the above-captioned cases (the “Debtors”). The Plan is described in the accompanying Disclosure Statement for Debtors’ First Amended Joint Chapter 11 Plan, dated July 9, 2019 (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Disclosure Statement”), which was approved by the Bankruptcy Court on July 11, 2019. Beneficial holders of Convertible Noteholder Claims in Class 6B voting through a Nominee must submit individual ballots (each, a “Beneficial Ballot”) casting a vote to accept or reject the Plan to the appropriate Nominee so that the Nominee may process such votes on this Master Ballot and return this Master Ballot so that it is received by Prime Clerk LLC (the “Solicitation

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 Capitalized terms used in this Master Ballot that are not otherwise defined herein have the meanings given to them in the Plan.

 

 

Agent”) on or before 4:00 p.m. (prevailing Eastern Time) on August 15, 2019. Before you transmit votes cast by beneficial holders to accept or reject the Plan, please review the Disclosure Statement and the instructions contained herein carefully.

 

It is important that you and the beneficial holders vote on the Plan. The Plan can be confirmed by the Bankruptcy Court and thereby made binding on you and the beneficial holders voting through you if it is accepted by the holders of at least two-thirds in amount and more than half in number of Claims actually voting in each Class of voting Claims. The votes of the Claims actually voted in each Class will bind those who do not vote. In the event that the requisite acceptances are not obtained, the Bankruptcy Court may nevertheless confirm the Plan if at least one impaired Class of Claims has accepted the Plan and the Bankruptcy Court finds that the Plan accords fair and equitable treatment to, and does not discriminate unfairly against, the Class or Classes of Claims rejecting it and otherwise satisfies the requirements of section 1129(b) of the Bankruptcy Code.

 

PLEASE READ AND FOLLOW THE ATTACHED INSTRUCTIONS CAREFULLY, COMPLETE, SIGN AND DATE THIS MASTER BALLOT, AND RETURN IT SO THAT IT IS RECEIVED BY THE SOLICITATION AGENT BEFORE THE VOTING DEADLINE OF 4:00 P.M. (PREVAILING EASTERN TIME) ON AUGUST 15, 2019. IF THIS MASTER BALLOT IS NOT COMPLETED, SIGNED AND TIMELY RECEIVED BY THE SOLICITATION AGENT, THE VOTES TRANSMITTED BY THIS MASTER BALLOT WILL NOT BE COUNTED.

 

Item 1.         Certification of Authority to Vote.

 

The undersigned certifies that the undersigned (please check all applicable boxes):

 

o                                    is a Nominee for the beneficial holder(s) of the aggregate principal amount of the Other General Unsecured Claims listed in Item 2 below, and is the registered holder or agent of the instruments evidencing such claims;

 

o                                    is acting under a power of attorney and/or agency (a copy of which will be provided upon request) granted by a Nominee that is the registered holder or agent of the aggregate principal amount of Other General Unsecured Claims listed in Item 2 below; or

 

o                                    has been granted a proxy (an original of which is attached hereto) from a Nominee that is the registered holder of or agent for the aggregate principal amount of Other General Unsecured Claims listed in Item 2 below,

 

and, accordingly, has full power and authority to vote to accept or reject the Plan on behalf of the beneficial holder(s) of the Other General Unsecured Claims described in Item 2 below.

 

Item 2.         Class 6B (Other General Unsecured Claims) Vote.

 

The undersigned certifies that below is a table setting forth: (i) the beneficial holders of Class 6B Other General Unsecured Claims related to the Convertible Notes who timely submitted a

 

2

 

completed Beneficial Ballot to the undersigned; (ii) the aggregate unpaid principal amount of each such holder’s Other General Unsecured Claim identified in such ballot; (iii) whether each such holder voted to accept or reject the Plan on account of its Other General Unsecured Claim; and (iv) whether each such holder elected to opt into the releases set forth in Section 12.6 of the Plan (Item 3 on each such holder’s Beneficial Ballot):

 

	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Item 3 of Beneficial
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Ballot (Optional)
    	
 
    
	
Your Customer
    	
 
    	
Principal Amount of Other General Unsecured Claims Voted in
    	
 
    	
Did Beneficial Holder
    	
 
    
	
Account Number for
    	
 
    	
Item 2 of the Beneficial Ballot
    	
 
    	
Opt Into Releases in
    	
 
    
	
Each Beneficial Holder
    	
 
    	
To Accept the Plan
    	
 
    	
To Reject the Plan
    	
 
    	
Section 12.6 of Plan?
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
OR
    	
$
    	
 
    	
 
    	
o
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
OR
    	
$
    	
 
    	
 
    	
o
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
OR
    	
$
    	
 
    	
 
    	
o
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
OR
    	
$
    	
 
    	
 
    	
o
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
OR
    	
$
    	
 
    	
 
    	
o
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
OR
    	
$
    	
 
    	
 
    	
o
    	
 
    
	
TOTALS:
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

(please attach additional sheets if necessary)

 

The undersigned certifies that the information provided above (including any information provided on additional sheets attached hereto) is a true and accurate schedule of the beneficial holders of Class 6B Other General Unsecured Claims related to the Convertible Notes, as identified by their respective account numbers, that have delivered duly completed individual Beneficial Ballots to the undersigned which ballots cast votes to accept or reject the Plan.

 

3

 

Item 3.         Additional Ballots Submitted by Beneficial Holders.

 

The undersigned certifies that the information provided below (including any information provided on additional sheets attached hereto) is a true and accurate schedule on which the undersigned has transcribed the information, if any, provided in Item 4 of each individual Beneficial Ballot received from a beneficial holder of a Class 6B Other General Unsecured Claim related to the Convertible Notes.

 

	
Information to be Transcribed from Item 4 of Individual Class 6B   Ballots

Regarding Other Ballots Cast in Respect of Other General Unsecured   Claims
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Name of Broker,
    	
 
    	
 
    
	
Your Customer
    	
 
    	
Beneficial Holder’s
    	
 
    	
 
    	
 
    	
Dealer, or Other
    	
 
    	
 
    
	
Account Number for
    	
 
    	
Name or Customer
    	
 
    	
 
    	
 
    	
Agent or Nominee
    	
 
    	
 
    
	
the Beneficial
    	
 
    	
Account Number for
    	
 
    	
CUSIP or ISIN
    	
 
    	
for Other Account
    	
 
    	
 
    
	
Holder
    	
 
    	
Other Account
    	
 
    	
Number
    	
 
    	
(if applicable)
    	
 
    	
Principal Amount
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

(please attach additional sheets if necessary)

 

Item 4.         Important Information Regarding the Releases.

 

Following confirmation, subject to Article XII of the Plan, the Plan will be substantially consummated on the Effective Date. Among other things, effective as of the Confirmation Date but subject to the occurrence of the Effective Date, certain release, injunction, exculpation and discharge provisions set forth in Article XII of the Plan will become effective. In determining how to cast your vote on the Plan, it is important to read the provisions contained in Article XII of the Plan very carefully so that you understand how confirmation and substantial consummation of the Plan — which effectuates such provisions — will affect you and any Claim(s) you may hold against the Debtors and/or certain other Released Parties specified in the Plan.(3)

 

(3)                                 As used herein and in the Plan, the term “Released Parties” means, collectively, and each solely in its capacity as such: (a) the Debtors, their respective non-Debtor subsidiaries, and the Reorganized Debtors; (b) Novelion; (c) the DIP Administrative Agent and the DIP Lenders; (d) the Bridge Loan Administrative Agent; (e) the Convertible Notes Trustee; (f) the Bridge Loan Lenders; (g) the Consenting Lenders; (h) the members of the Ad Hoc Group; (i) the Plan Investor; (j) the Committee and each of its current and former members solely in their capacity as members of the Committee; (k) each of such parties’ respective predecessors, successors, assigns, subsidiaries, owners, affiliates, managed accounts, funds or funds under common management; and (l) each of the foregoing parties’ (described in clauses (a)-(k)) respective current and former officers, directors, managers, managing members, employees, members, principals, shareholders, agents, advisory board members, management companies, fund advisors, partners, attorneys, financial advisors or other professionals or representatives, together with their successors and assigns, in each case solely in their capacity as such; provided, however, that former directors, officers and employees of the Debtors shall not be deemed Released Parties; provided  further that such attorneys and professional advisors shall only include those that provided services related to the Chapter 11 Cases and the transactions contemplated by this Plan (and do not include the attorneys and law firms retained by the Debtors in the ordinary course of business during these Chapter 11 Cases); provided, further, that no Person shall be a Released Party if it objects to the releases provided for in Article XII of this Plan.

 

4

 

Specifically, except as otherwise set forth in the Plan or Confirmation Order, the releases in Section 12.6 of the Plan (the “Releases”) bind (a) each holder of a Claim that voted to accept the Plan, (b) each Released Party, and (c) to the fullest extent permissible under applicable law, as such law may be extended or interpreted subject to the Effective Date, (i) all holders of a Claim who vote to reject the Plan and “opt in” to the Releases, (ii) all holders of a Claim or Interest who are not entitled to vote to accept or reject the Plan and “opt in” to the Releases, or (iii) all other holders of a Claim or Interest who elect to “opt in” to the Releases. The Releases provide for, among other things, the following:

 

Releases by the Debtors. Except as otherwise provided in the Plan or the Confirmation Order, as of the Effective Date, the Debtors, as, debtors in possession, and any person seeking to exercise the rights of the Debtors’ Estates, including without limitation, any successor to the Debtors or any representative of the Debtors’ Estates appointed or selected pursuant to sections 1103, 1104 or 1123(b)(3) of the Bankruptcy Code or under chapter 7 of the Bankruptcy Code, shall be deemed to forever release, waive and discharge all claims (as such term “claim” is defined in section 101(5) of the Bankruptcy Code), obligations, suits, judgments, damages, demands, debts, rights, causes of action (including, but not limited to, the Causes of Action) and liabilities (other than the rights of the Debtors to enforce the Plan and the contracts, instruments, releases and other agreements or documents delivered thereunder) against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act, omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the purchase, sale or rescission of the purchase or sale of any security of the Debtors, the subject matter of, or the transactions or events giving rise to, any Claim or Interest that is treated in the Plan, the parties released pursuant to this Section 12.6, the Chapter 11 Cases, the RSA, the DIP Financing Agreement, the Plan Funding Agreement, or the Plan or the Disclosure Statement, and that could have been asserted by or on behalf of the Debtors or their Estates, whether directly, indirectly, derivatively or in any representative or any other capacity; provided, however, that in no event shall anything in this Section 12.06(a) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases in the Plan, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the

 

5

 

releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims released by the releases in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after reasonable investigation by the Debtors and after notice and opportunity for hearing; and (6) a bar to any of the Debtors asserting any claim released by the releases in the Plan against any of the Released Parties.

 

Third Party Releases. Except as otherwise provided in the Plan, the Plan Funding Agreement or the Confirmation Order, on the Effective Date each Releasing Party, in consideration for the obligations of the Debtors under the Plan, the distributions under the Plan and other contracts, instruments, releases, agreements or documents executed and delivered in connection with the Plan, will be deemed to have consented to the Plan and the restructuring embodied in the Plan for all purposes and deemed to forever release, waive and discharge all claims (as such term is defined in section 101(5) of the Bankruptcy Code), including but not limited to any claim sounding in law or equity or asserting a tort, breach of any duty or contract, violations of the common law, any federal or state statute, any federal or state securities laws or otherwise, demands, debts, rights, causes of action (including without limitation, the Causes of Action) or liabilities (other than the right to enforce the obligations of any party under the Plan and the contracts, instruments, releases, agreements and documents delivered under or in connection with the Plan), including, without limitation, any claims for any such loss such holder may suffer, have suffered or be alleged to suffer as a result of the Debtors commencing the Chapter 11 Cases or as a result of the Plan being consummated, against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act or omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the Chapter 11 Cases, the Plan or the Disclosure Statement; provided, however, that in no event shall anything in this Section 12.06(b) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases of holders of Claims and Interests, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after notice and opportunity for hearing; and (6) a bar to any holder of a Claim or Interest asserting any Claim released by the releases in the Plan against any of the Released Parties.

 

Notwithstanding anything to the contrary contained in the Plan: (i) except to the extent permissible under applicable law, as such law may be extended or interpreted subsequent to the Effective Date, the releases provided for in this Section 12.06 of the Plan shall not release any non-Debtor entity from any liability arising under (a) the Internal Revenue Code or any state, city or municipal tax code, (b) any criminal laws of the United States or any state, city or

 

6

 

municipality, or (c) any environmental laws of the United States or any state, city or municipal tax code; and (ii) the releases set forth in this Section 12.06 shall not release any (a) claims, right, or Causes of Action for money borrowed from or owed to the Debtors by any of their directors, officers or former employees, as set forth in the Debtors’ books and records, (b) any claims against any Person to the extent such Person asserts a crossclaim, counterclaim and/or claim for setoff which seeks affirmative relief against a Debtor or any of its officers, directors, or representatives, (c) claims against any Person arising from or relating to such Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order of the Bankruptcy Court, and (d) any Unimpaired Claims unless and until holders of Unimpaired Claims have received payment on account of such Claims that render such claims Unimpaired in accordance with the Plan.

 

Notwithstanding any language to the contrary contained in this Disclosure Statement, Plan, and/or the Confirmation Order, no provision of the Plan or the Confirmation Order shall (i) preclude the SEC from enforcing its police or regulatory powers; or (ii) enjoin, limit, impair, or delay the SEC from commencing or continuing any claims, causes of action, proceedings or investigations against any non-Debtor person or non-Debtor entity in any forum.

 

As to any Governmental Unit (as defined in section 101(27) of the Bankruptcy Code), nothing in the Plan, Plan Documents, or Confirmation Order shall limit or expand the scope of discharge, release or injunction to which the Debtors or Reorganized Debtors are entitled under the Bankruptcy Code, if any. The discharge, release, and injunction provisions contained in the Plan, Plan Documents, or Confirmation Order are not intended and shall not be construed to bar any Governmental Unit from, subsequent to the Confirmation Order, pursuing any police or regulatory action.

 

Accordingly, notwithstanding anything contained in the Plan, Plan Documents, or Confirmation Order to the contrary, nothing in the Plan or Confirmation Order shall discharge, release, impair or otherwise preclude: (1) any liability to any Governmental Unit that is not a “claim” within the meaning of section 101(5) of the Bankruptcy Code; (2) any Claim of any Governmental Unit arising on or after the Confirmation Date; (3) any valid right of setoff or recoupment of any Governmental Unit against any of the Debtors; or (4) any liability of the Debtors or Reorganized Debtors under police or regulatory statutes or regulations to any Governmental Unit as the owner, lessor, lessee or operator of property that such entity owns, operates or leases after the Confirmation Date. Nor shall anything in the Plan, Plan Documents, or Confirmation Order: (i) enjoin or otherwise bar any Governmental Unit from asserting or enforcing, outside the Bankruptcy Court, any liability described in the preceding sentence; or (ii) divest any court, commission, or tribunal of jurisdiction to determine whether any liabilities asserted by any Governmental Unit are discharged or otherwise barred by the Plan, Plan Documents, Confirmation Order, or the Bankruptcy Code.

 

Moreover, nothing in the Plan, Plan Documents, or Confirmation Order shall release or exculpate any non-debtor, including any Released Parties and/or exculpated parties, from any liability to any Governmental Unit, including but not limited to any liabilities arising under the Internal Revenue Code, the environmental laws, or the criminal laws against the Released Parties and/or exculpated parties, nor shall anything in the Plan, Plan Documents, or Confirmation Order enjoin any Governmental Unit from bringing any claim, suit, action or

 

7

 

other proceeding against any non-Debtor for any liability whatsoever; provided, however, that the foregoing sentence shall not limit the scope of discharge granted to the Debtors under sections 524 and 1141 of the Bankruptcy Code.

 

Nothing contained in the Plan, Plan Documents, or Confirmation Order shall be deemed to determine the tax liability of any person or entity, including but not limited to the Debtors and the Reorganized Debtors, nor shall the Plan, Plan Documents, or Confirmation Order be deemed to have determined the federal and/or state tax treatment of any item, distribution, or entity, including the federal and/or state tax consequences of the Plan and/or Plan Documents, nor shall anything in the Plan, Plan Documents, or Confirmation Order be deemed to have conferred jurisdiction upon the Bankruptcy Court to make determinations as to federal and/or state tax liability and federal and/or state tax treatment except as provided under 11 U.S.C. § 505.

 

Article X of the Plan regarding Executory Contracts and Unexpired Leases, and Section 7.8 of the Plan regarding Cancellation of Existing Securities and Agreements, shall not apply to the Government Settlement Agreements. The Government Settlement Agreements shall be unimpaired by the Plan, Plan Documents, and Confirmation Order, and shall remain obligations of the Debtors and/or the Reorganized Debtors, and all rights, obligations, and duties under the Government Settlement Agreements shall be preserved as if the Debtors’ bankruptcy cases were never filed. All Governmental Units reserve all rights with respect to the Government Settlement Agreements, and nothing contained in the Plan, Plan Documents, or Confirmation Order shall discharge, release, impair, or otherwise preclude any liability to any Governmental Unit arising from or relating to the Government Settlement Agreements. Any amounts owed to Governmental Units under the Government Settlement Agreements shall be paid in full when due in the ordinary course and nothing in the Plan, Plan Documents, or Confirmation Order shall be interpreted to set cure amounts, authorize the assignment or rejection of any Government Settlement Agreement, or require any Governmental Unit to approve of and consent to the assignment of any Government Settlement Agreement. The Debtors and Reorganized Debtors expressly agree that any provisions regarding default in the Government Settlement Agreements shall continue to apply as set forth in those agreements, irrespective of any provisions of the Plan, Plan Documents, and Confirmation Order. For the avoidance of doubt, nothing contained in the Plan, Plan Documents, or Confirmation Order shall divest any court, commission, or tribunal of jurisdiction over any matters related to the Government Settlement Agreements, or confer on the Bankruptcy Court jurisdiction over any matter related to the Government Settlement Agreements. Notwithstanding anything to the contrary in this paragraph, the provisions of this paragraph are subject to the provisions of Section 5.5 of the Plan regarding acceleration or increase of the monetary obligations under the Government Settlement Agreements.

 

The governmental units that are parties to the Government Settlement Agreements have not at this time sought to accelerate or increase payments under those agreements as a result of the filing of these Chapter 11 Cases or the consummation of the transactions contemplated by the Plan and the Plan Documents. The Debtors and certain of the governmental units that are parties to the Government Settlement Agreements are in discussions regarding the intentions of those parties regarding acceleration of the Debtors’ payment obligations under the Government Settlement Agreements. The Debtors and these parties to the Government

 

8

 

Settlement Agreements anticipate reaching resolution on this issue before the Plan is confirmed.

 

Item 5.         Certification.

 

By signing this Master Ballot, the undersigned certifies that each beneficial holder whose vote is being transmitted by this Master Ballot has been provided with a copy of the Disclosure Statement, the Plan, and all other applicable solicitation materials, and that the Beneficial Ballots received from each beneficial holder of a Class 6B Other General Unsecured Claim related to the Convertible Notes or a copy thereof is and will remain on file with the undersigned subject to inspection for a period of one (1) year following the Voting Deadline.

 

9

 

	
SIGNED:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
NAME OF NOMINEE:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
PARTICIPANT NUMBER:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
TITLE:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
IF AUTHORIZED BY AGENT,
    	
 
    	
 
    
	
NAME AND TITLE:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
NAME OF INSTITUTION:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
STREET ADDRESS:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
CITY, STATE, ZIP:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
TELEPHONE NO.:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
DATED:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
EMAIL:
    	
 
    	
 
    
											

 

THIS MASTER BALLOT MUST BE RECEIVED BY PRIME CLERK AT THE FOLLOWING ADDRESS ON OR BEFORE 4:00 P.M. (PREVAILING EASTERN TIME) ON AUGUST 15, 2019, OR THE VOTES TRANSMITTED HEREBY WILL NOT BE COUNTED:

 

AEGERION PHARMACEUTICALS, INC. BALLOT PROCESSING CENTER

C/O PRIME CLERK LLC

ONE GRAND CENTRAL PLACE

60 EAST 42ND STREET, SUITE 1440

NEW YORK, NY 10165

OR VIA EMAIL: AEGERIONBALLOTS@PRIMECLERK.COM

 

PLEASE NOTE: MASTER BALLOTS WILL NOT BE ACCEPTED BY FACSIMILE OR OTHER ELECTRONIC TRANSMISSION, UNLESS APPROVED BY THE DEBTORS IN WRITING.

 

IF YOU HAVE ANY QUESTIONS REGARDING THIS MASTER BALLOT OR THE VOTING PROCEDURES, OR IF YOU NEED ADDITIONAL COPIES OF THIS MASTER BALLOT, BENEFICIAL BALLOTS, THE DISCLOSURE STATEMENT OR OTHER RELATED MATERIALS, PLEASE CONTACT THE SOLICITATION AGENT VIA TELEPHONE AT 844-627-5368 OR FOR INTERNATIONAL CALLS AT 347-292-3524 OR VIA EMAIL AT AEGERIONBALLOTS@PRIMECLERK.COM.

 

10

 

INSTRUCTIONS FOR COMPLETING THE MASTER BALLOT

 

On July 11, 2019, the Bankruptcy Court approved the Disclosure Statement relating to the Plan, and authorized the Debtors to solicit votes with regard to the acceptance or rejection of the Plan. The Debtors are soliciting votes of your customers or constituents who are beneficial holders of Other General Unsecured Claims on the Plan. This Master Ballot is to identify the vote of your customers or constituents who hold Other General Unsecured Claims under the Plan.

 

To have your vote counted, you must complete, sign and return this paper Ballot so that it is actually  received by the Solicitation Agent not later than 4:00 p.m. (prevailing Eastern Time) on August 15, 2019. A PREPAID ENVELOPE ADDRESSED TO THE SOLICITATION AGENT IS ENCLOSED FOR YOUR CONVENIENCE. Return the completed Ballot and your tax form to:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

Or via email: aegerionballots@primeclerk.com

 

YOU ARE REQUIRED TO RETAIN A COPY OF THE UNDERLYING BENEFICIAL BALLOTS RECEIVED FROM THE BENEFICIAL HOLDERS FOR INSPECTION FOR A PERIOD OF ONE (1) YEAR FOLLOWING THE VOTING DEADLINE.

 

This Master Ballot is not a letter of transmittal and may not be used for any purpose other than to cast votes to accept or reject the Plan. Holders should not surrender, at this time, certificates (if any) representing their securities. Neither the Debtors nor the Solicitation Agent will accept delivery of any such certificates surrendered together with this Master Ballot.

 

If you are transmitting the votes of any beneficial holders of Other General Unsecured Claims other than yourself, you must deliver a Beneficial Ballot, the Disclosure Statement and Plan (which may be provided on a USB flash drive included in the materials sent to you by the Debtors), the order approving the Disclosure Statement, the Confirmation Hearing Notice and any other materials requested to be forwarded to the beneficial holders of Other General Unsecured Claims within five (5) business days after your receipt of the aforementioned items. Such beneficial holders must complete and execute a Beneficial Ballot by voting to accept or reject the Plan, and return the completed, executed Beneficial Ballot to you so that you have sufficient time to process such votes on this Master Ballot and return this Master Ballot so that it is actually  received by the Solicitation Agent on or prior to 4:00 p.m. (prevailing Eastern time) on August 15, 2019.

 

With respect to all Beneficial Ballots returned to you, you must properly complete the Master Ballot as follows:

 

(i)                                               Check the appropriate box(es) in Item 1 of the Master Ballot.

 

11

 

(ii)                                            Indicate the votes to accept or reject the Plan in Item 2 of the Master Ballot, as transmitted to you by the beneficial holders of the Other General Unsecured Claims. IMPORTANT: EACH HOLDER OF AN OTHER GENERAL UNSECURED CLAIM MUST VOTE ALL OF SUCH HOLDER’S CLAIMS IN CLASS 6B EITHER TO ACCEPT OR REJECT THE PLAN. IF ANY BENEFICIAL HOLDER’S BENEFICIAL BALLOT DOES NOT INDICATE AN ACCEPTANCE OR REJECTION OF THE PLAN, OR INDICATES BOTH AN ACCEPTANCE AND A REJECTION OF THE PLAN WITH RESPECT TO ITS OTHER GENERAL UNSECURED CLAIM(S), SUCH VOTE SHOULD NOT BE COUNTED. HOLDERS OF CLAIMS MAY NOT SPLIT THEIR VOTES WITH RESPECT TO THEIR CLAIMS. IF ANY BENEFICIAL HOLDER OF AN OTHER GENERAL UNSECURED CLAIM HAS ATTEMPTED TO SPLIT ITS VOTE BY SUBMITTING A BENEFICIAL BALLOT THAT PARTIALLY ACCEPTS AND PARTIALLY REJECTS THE PLAN, AND ALLOCATES PORTIONS OF ITS CLAIM IN SUCH MANNER, SUCH VOTE SHOULD NOT BE COUNTED. Beneficial holders that submit multiple Beneficial Ballots in respect of the same Other General Unsecured Claim shall be deemed to have voted in the manner of the last valid Beneficial Ballot received.

 

(iii)                                         Please note that Item 3 of this Master Ballot requests that you transcribe the information provided by each beneficial holder from Item 4 of each completed Class 6B Beneficial Ballot. Please also include your customer account number for each entry in Item 3 of this Master Ballot.

 

(iv)                                        Please note in Item 3 of this Master Ballot whether beneficial holders of the Other General Unsecured Claims subject to this Master Ballot opted into the Releases provided in Section 12.6 of the Plan.

 

(v)                                           Independently verify and confirm the accuracy of the information provided with respect to each beneficial holder of an Other General Unsecured Claim identified in your Master Ballot.

 

(vi)                                        Review the certifications in Item 5 of the Master Ballot.

 

(vii)                                     Sign and date the Master Ballot, and provide the additional information requested.

 

(viii)                                  If additional space is required to respond to any item on the Master Ballot, please use additional sheets of paper clearly marked to indicate the applicable item of the Master Ballot to which you are responding.

 

(ix)                                        Return the completed and originally executed Master Ballot to the Solicitation Agent at the address set forth above so as to be actually

 

12

 

received by the Solicitation Agent on or before the Voting Deadline. You must retain a copy of all returned Beneficial Ballots in your files for one (1) year from the Voting Deadline.

 

(x)                                           Votes cast by beneficial holders of Other General Unsecured Claims through a Nominee should be applied against the positions held by such entities in the Convertible Notes as of 5:00 p.m. (prevailing Eastern Time) on July 11, 2019 (the “Voting Record Date”), as evidenced by the record and depository listings. Votes submitted by a Nominee, pursuant to a Master Ballot or a pre-validated Beneficial Ballot, will not be counted in excess of the record amount of such securities held by such Nominee as of the Voting Record Date.

 

(xi)                                        To the extent that conflicting votes or “overvotes” are submitted by a Nominee, the Solicitation Agent, in good faith, will attempt to reconcile discrepancies with the Nominee.

 

(xii)                                     To the extent that overvotes on a Master Ballot are not reconcilable prior to the preparation of the vote certification, the Solicitation Agent will apply the votes to accept and to reject the Plan submitted on the Master Ballots or pre-validated Beneficial Ballots that contained the overvote, but only to the extent of the Nominee’s position in the Other General Unsecured Claim.

 

(xiii)                                  Where a beneficial holder holds its Other General Unsecured Claim through more than one Nominee, such holder must execute a separate Beneficial Ballot for each block of securities. However, such holder must vote all of its Other General Unsecured Claims in the same manner, to either accept or reject the Plan. Accordingly, if such holder returns more than one Beneficial Ballot to more than one Nominee voting different Other General Unsecured Claims and the Beneficial Ballots are not voted in the same manner, as reflected on such separate Master Ballots, such votes will not be counted (which determination will be made based on information reasonably known to the Solicitation Agent).

 

(xiv)                                 For the purposes of tabulating votes, each beneficial holder will be deemed to have voted the principal amount relating to such security, although the Solicitation Agent may adjust such principal amount to reflect the Claim amount, including prepetition interest.

 

(xv)                                    After the Voting Deadline, no vote may be withdrawn without the prior consent of the Debtors.

 

PLEASE NOTE:

 

All Master Ballots and Beneficial Ballots are for voting purposes only and do not constitute, and shall not be deemed, a proof of claim, an assertion of a Claim or an admission by the Debtors of the validity of a Claim.

 

13

 

No fees, commissions or other remuneration will be payable to any broker, dealer or other person for soliciting votes on the Plan. The Debtors will, however, upon request, reimburse you for customary mailing and handling expenses incurred by you in forwarding the Beneficial Ballots and other enclosed materials to the beneficial holders of the Other General Unsecured Claims held by you as a Nominee or in a fiduciary capacity.

 

If you have any questions relating to this Master Ballot, please contact the Solicitation Agent via telephone at 844-627-5368 or for international calls at 347-292-3524.

 

NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL RENDER YOU OR ANY OTHER PERSON THE AGENT OF THE DEBTORS OR THE SOLICITATION AGENT, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON BEHALF OF ANY OF THEM WITH RESPECT TO THE PLAN, EXCEPT FOR THE STATEMENTS CONTAINED IN THE ENCLOSED DOCUMENTS.

 

14

 

	
UNITED   STATES BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF   NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion   Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632   (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

BENEFICIAL BALLOT FOR CONVERTIBLE NOTEHOLDERS IN CLASS 6B

(OTHER GENERAL UNSECURED CLAIMS) FOR ACCEPTING OR REJECTING

THE DEBTORS’ FIRST AMENDED JOINT CHAPTER 11 PLAN

 

TO BE COUNTED, YOUR VOTE MUST BE ACTUALLY RECEIVED BY THE SOLICITATION AGENT BY AUGUST 15, 2019, AT 4:00 P.M. (PREVAILING EASTERN TIME). PLEASE FOLLOW THE VOTE DELIVERY INSTRUCTIONS PROVIDED BY YOUR NOMINEE, OR IF YOU RECEIVED A RETURN ENVELOPE ADDRESSED TO YOUR NOMINEE, PLEASE ALLOW SUFFICIENT TIME FOR YOUR NOMINEE TO PROCESS YOUR VOTE ON A MASTER BALLOT AND RETURN THE MASTER BALLOT SO THAT IT IS ACTUALLY RECEIVED BY THE SOLICITATION AGENT BEFORE THE VOTING DEADLINE. DO NOT RETURN THIS BENEFICIAL BALLOT DIRECTLY TO THE SUBSCRIPTION AGENT OR IT WILL BE INVALID.

 

This ballot (the “Ballot”) is being submitted to you by Aegerion Pharmaceuticals, Inc. and Aegerion Pharmaceuticals Holdings, Inc. as debtors and debtors in possession in the above-captioned cases (the “Debtors”) to solicit your vote to accept or reject the Debtors’ First Amended Joint Chapter 11 Plan [Docket 180] (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Plan”).(2)

 

The Bankruptcy Court has approved the Debtors’ Disclosure Statement for First Amended Joint Chapter 11 Plan [Docket No. 182] (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Disclosure Statement”). The Disclosure Statement describes the Plan and provides information to assist you in deciding how to vote your Ballot. Bankruptcy Court approval of the Disclosure Statement does not indicate Bankruptcy Court approval of the Plan.

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 Capitalized terms used in this Ballot that are not otherwise defined herein have the meanings given to them in the Plan.

 

 

If you do not have a Disclosure Statement, you may obtain a copy free of charge on the dedicated webpage of Prime Clerk LLC, the Debtors’ court-approved solicitation agent (the “Solicitation Agent”) in these cases, at http://primeclerk.com/aegerion. A copy of the Disclosure Statement is also available: (a) at the Office of the Clerk of the Bankruptcy Court; (b) on the Bankruptcy Court’s website, http://www.nysb.uscourts.gov (a PACER account is required); (c) upon written request to the Solicitation Agent at Aegerion Pharmaceuticals, Inc. Ballot Processing Center, c/o Prime Clerk LLC, One Grand Central Place, 60 East 42nd Street, Suite 1440, New York, NY 10165; or (d) by contacting the Solicitation Agent via telephone at 844-627-5368 or for international calls at 347-292-3524 or via email at: aegerionballots@primeclerk.com.

 

IMPORTANT

 

You should review the Disclosure Statement and the Plan before you vote. You may wish to seek legal advice concerning the Plan and your classification and treatment under the Plan. Your Claim has been placed in Class 6B Other General Unsecured Claims under the Plan. If you hold Claims in more than one Class under the Plan, you will receive a ballot for each Class in which you are entitled to vote.

 

To have your vote counted, it must be received by the broker, bank, commercial bank, transfer agent, trust company, dealer, or other agent or nominee that sent you this Ballot (as applicable, the “Nominee”) so that it is actually  received by the Solicitation Agent not later than 4:00 p.m. (prevailing Eastern Time) on August 15, 2019 (the “Voting Deadline”). IF YOU RECEIVE A RETURN ENVELOPE ADDRESSED TO YOUR NOMINEE OR OTHER INSTRUCTIONS FROM YOUR NOMINEE, PLEASE ALLOW SUFFICIENT TIME FOR YOUR NOMINEE TO PROCESS YOUR VOTE ON A MASTER BALLOT AND RETURN THE MASTER BALLOT SO THAT IT IS ACTUALLY RECEIVED BY THE SOLICITATION AGENT BEFORE THE VOTING DEADLINE.

 

If the Plan is confirmed by the Bankruptcy Court it will be binding on you whether or not you vote.

 

2

 

ACCEPTANCE OR REJECTION OF THE PLAN

 

Item 1.         Vote Amount.

 

For purposes of voting to accept or reject the Plan, as of 5:00 p.m. (prevailing Eastern Time) on July 11, 2019 (the “Voting Record Date”), the undersigned (the “Claimant”) was a holder of a Class 6B Other General Unsecured Claims relating to the Convertible Senior Unsecured Notes due 2019 issued by Aegerion Pharmaceuticals, Inc. (the “Convertible Notes”) in the aggregate principal amount set forth below. (If you do not know the principal amount of your Class 6B Other General Unsecured Claim, please contact your nominee immediately).

 

$

 

Item 2.         Vote on Plan.

 

CHECK ONE BOX ONLY

 

o                                    ACCEPTS (votes FOR) the Plan.

 

o                                    REJECTS (votes AGAINST) the Plan.

 

IMPORTANT INFORMATION REGARDING THE RELEASES

 

Following confirmation, subject to Article XII of the Plan, the Plan will be substantially consummated on the Effective Date. Among other things, effective as of the Confirmation Date but subject to the occurrence of the Effective Date, certain release, injunction, exculpation and discharge provisions set forth in Article XII of the Plan will become effective. In determining how to cast your vote on the Plan, it is important to read the provisions contained in Article XII of the Plan very carefully so that you understand how confirmation and substantial consummation of the Plan — which effectuates such provisions — will affect you and any Claim(s) you may hold against the Debtors and/or certain other Released Parties specified in the Plan.(3)

 

(3)                                 As used herein and in the Plan, the term “Released Parties” means, collectively, and each solely in its capacity as such: (a) the Debtors, their respective non-Debtor subsidiaries, and the Reorganized Debtors; (b) Novelion; (c) the DIP Administrative Agent and the DIP Lenders; (d) the Bridge Loan Administrative Agent; (e) the Convertible Notes Trustee; (f) the Bridge Loan Lenders; (g) the Consenting Lenders; (h) the members of the Ad Hoc Group; (i) the Plan Investor; (j) the Creditors’ Committee (if any) and each of its members solely in their capacity as members of the Creditors’ Committee; (k) each of such parties’ respective predecessors, successors, assigns, subsidiaries, owners, affiliates, managed accounts or funds; and (l) each of the foregoing parties’ (described in clauses (a)-(k)) respective current and former officers, directors, managers, managing members, employees, members, principals, shareholders, agents, advisory board members, management companies, fund advisors, partners, attorneys, financial advisors or other professionals or representatives, together with their successors and assigns; provided, however, that such attorneys and professional advisors shall only include those that provided services related to the Chapter 11 Cases and the transactions contemplated by the Plan (and do not include the attorneys and law firms retained by the Debtors in the ordinary course of business during these Chapter 11 Cases); provided, further, that no Person shall be a Released Party if it objects to the releases provided for in Article XII of the Plan.

 

3

 

Specifically, except as otherwise set forth in the Plan or Confirmation Order, the releases in Section 12.6 of the Plan (the “Releases”) bind (a) each holder of a Claim that voted to accept the Plan, (b) each Released Party, and (c) to the fullest extent permissible under applicable law, as such law may be extended or interpreted subject to the Effective Date, (i) all holders of a Claim who vote to reject the Plan and “opt in” to the Releases, (ii) all holders of a Claim or Interest who are not entitled to vote to accept or reject the Plan and “opt in” to the Releases, or (iii) all other holders of a Claim or Interest who elect to “opt in” to the Releases. The Releases provide for, among other things, the following:

 

Releases by the Debtors. Releases by the Debtors. Except as otherwise provided in the Plan or the Confirmation Order, as of the Effective Date, the Debtors, as, debtors in possession, and any person seeking to exercise the rights of the Debtors’ Estates, including without limitation, any successor to the Debtors or any representative of the Debtors’ Estates appointed or selected pursuant to sections 1103, 1104 or 1123(b)(3) of the Bankruptcy Code or under chapter 7 of the Bankruptcy Code, shall be deemed to forever release, waive and discharge all claims (as such term “claim” is defined in section 101(5) of the Bankruptcy Code), obligations, suits, judgments, damages, demands, debts, rights, causes of action (including, but not limited to, the Causes of Action) and liabilities (other than the rights of the Debtors to enforce the Plan and the contracts, instruments, releases and other agreements or documents delivered thereunder) against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act, omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the purchase, sale or rescission of the purchase or sale of any security of the Debtors, the subject matter of, or the transactions or events giving rise to, any Claim or Interest that is treated in the Plan, the parties released pursuant to Section 12.6 of the Plan, the Chapter 11 Cases, the RSA, the DIP Financing Agreement, the Plan Funding Agreement, or the Plan or the Disclosure Statement, and that could have been asserted by or on behalf of the Debtors or their Estates, whether directly, indirectly, derivatively or in any representative or any other capacity; provided, however, that in no event shall anything in Section 12.06(a) of the Plan be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases herein, which includes by reference each of the related provisions and definitions contained herein, and further, shall constitute the Bankruptcy Court’s finding that the releases herein are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims released by the releases herein; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after reasonable investigation by the Debtors and after notice and opportunity for hearing; and (6) a bar to any of the Debtors asserting any claim released by the releases herein against any of the Released Parties.

 

Third Party Releases. Except as otherwise provided in the Plan, the Plan Funding Agreement or the Confirmation Order, on the Effective Date each Releasing Party, in

 

4

 

consideration for the obligations of the Debtors under the Plan, the distributions under the Plan and other contracts, instruments, releases, agreements or documents executed and delivered in connection with the Plan, will be deemed to have consented to the Plan and the restructuring embodied herein for all purposes and deemed to forever release, waive and discharge all claims (as such term is defined in section 101(5) of the Bankruptcy Code), including but not limited to any claim sounding in law or equity or asserting a tort, breach of any duty or contract, violations of the common law, any federal or state statute, any federal or state securities laws or otherwise, demands, debts, rights, causes of action (including without limitation, the Causes of Action) or liabilities (other than the right to enforce the obligations of any party under the Plan and the contracts, instruments, releases, agreements and documents delivered under or in connection with the Plan), including, without limitation, any claims for any such loss such holder may suffer, have suffered or be alleged to suffer as a result of the Debtors commencing the Chapter 11 Cases or as a result of the Plan being consummated, against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act or omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the Chapter 11 Cases, the Plan or the Disclosure Statement; provided, however, that in no event shall anything in Section 12.06(b) of the Plan be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases of holders of Claims and Interests, which includes by reference each of the related provisions and definitions contained herein, and further, shall constitute the Bankruptcy Court’s finding that the releases herein are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims herein; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after notice and opportunity for hearing; and (6) a bar to any holder of a Claim or Interest asserting any Claim released by the releases herein against any of the Released Parties.

 

Notwithstanding anything to the contrary contained herein: (i) except to the extent permissible under applicable law, as such law may be extended or interpreted subsequent to the Effective Date, the releases provided for in Section 12.06 of the Plan shall not release any non-Debtor entity from any liability arising under (x) the Internal Revenue Code or any state, city or municipal tax code, (y) any criminal laws of the United States or any state, city or municipality, or (y) any environmental laws of the United States or any state, city or municipal tax code; and (ii) the releases set forth in Section 12.06 of the Plan shall not release any (x) claims, right, or Causes of Action for money borrowed from or owed to the Debtors by any of their directors, officers or former employees, as set forth in the Debtors’ books and records, (y) any claims against any Person to the extent such Person asserts a crossclaim, counterclaim and/or claim for setoff which seeks affirmative relief against a Debtor or any of its officers, directors, or representatives, and (z) claims against any Person arising from or relating to such Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order of the Bankruptcy Court.

 

5

 

While the Debtors are seeking the consensual release of Claims and Interests against the Released Parties, to the extent that such consensual releases are not granted by the holders of Claims and Interests, the Debtors reserve the right to seek approval from the Bankruptcy Court to grant the Third Party Releases on a non-consensual basis, regardless of the percentage of holders of Claims and Interests who consensually release their Claims against the Released Parties.

 

Item 3.         Opt-In Election (for holders of Class 6B Other General Unsecured Claims that abstain from voting or vote to REJECT the Plan only)

 

If you did not vote to accept the Plan in Item 2, either because you abstained from voting on the Plan or voted to reject the Plan, you are still entitled to opt into the releases set forth in Article XII of the Plan by making such election below. DO NOT COMPLETE THE FOLLOWING ELECTION IF YOU VOTED TO ACCEPT THE PLAN IN ITEM 2. PURSUANT TO THE TERMS OF THE PLAN, IF YOU VOTE TO ACCEPT THE PLAN YOU WILL BE DEEMED TO HAVE CONSENTED TO THE RELEASES SET FORTH IN ARTICLE XII OF THE PLAN.

 

o                                    The undersigned elects to grant (OPTS IN TO) the Releases set forth in Section 12.6 of the Plan.

 

Item 4.         Other Ballots.

 

By returning this Ballot, Claimant certifies that Claimant has not submitted any other ballots for or on account of his/her Class 6B Other General Unsecured Claims held in other accounts or other record names, except for ballots for or on account of those Class 6B Other General Unsecured Claims identified in the following table (which you may use additional paper to supplement as necessary).

 

	
Other Ballots Cast in Respect   of Class 6B Other General Unsecured Claims
    
	
 
    	
 
    	
 
    	
 
    	
Name of Broker, Bank,
    	
 
    	
 
    
	
Your Name or Customer
    	
 
    	
 
    	
 
    	
Dealer or Other Agent or
    	
 
    	
Principal Amount of
    
	
Account Number for Other
    	
 
    	
 
    	
 
    	
Nominee for Other Account
    	
 
    	
Convertible Notes for
    
	
Account for Which a Ballot
    	
 
    	
CUSIP or ISIN
    	
 
    	
for Which a Ballot has been
    	
 
    	
Which Ballot has been
    
	
Has Been Submitted
    	
 
    	
Number
    	
 
    	
Submitted (if applicable)
    	
 
    	
Submitted
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

6

 

Item 5.         Certification.

 

By signing this Ballot, the undersigned Claimant hereby certifies that: (a) on the Voting Record Date, it was the holder of a Class 6B Other General Unsecured Claims related to the Convertible Notes to which this Ballot pertains (or an authorized signatory for such holder); (b) it has full power and authority to vote to accept or reject the Plan; and (c) it had received a copy of the Disclosure Statement (including all exhibits thereto) and other solicitation materials. The undersigned understands that an otherwise properly completed, executed and timely-returned Ballot that does not indicate either acceptance or rejection of the Plan or indicates both acceptance and rejection of the Plan will not be counted. By signing this Ballot, the undersigned is also certifying that its vote on the Plan is subject to all the terms and conditions set forth in the Plan and the Disclosure Statement.

 

	
Name of Claimant:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name (if different from   Claimant):
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title (if corporation   or partnership):
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Dated:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Email:
    	
 
    	
 
    
						

 

PLEASE MAKE SURE YOU HAVE PROVIDED ALL INFORMATION REQUESTED IN THIS BALLOT. PLEASE READ AND FOLLOW THE INSTRUCTIONS SET FORTH BELOW CAREFULLY. PLEASE COMPLETE, SIGN AND DATE THIS BALLOT AND RETURN IT TO YOUR NOMINEE IN THE ENVELOPE PROVIDED OR FOLLOW THE VOTE DELIVERY INSTRUCTIONS PROVIDED BY YOUR NOMINEE. PLEASE ALLOW SUFFICIENT TIME FOR YOUR NOMINEE TO PROCESS YOUR VOTE ON A MASTER BALLOT AND RETURN THE MASTER BALLOT SO THAT IT IS ACTUALLY RECEIVED BY THE SOLICITATION AGENT BEFORE THE VOTING DEADLINE.

 

7

 

VOTING INSTRUCTIONS

 

1.                                      In order for your vote to count, you must:

 

(i)                                     In the boxes provided in Item 2 of the Ballot, indicate either acceptance or rejection of the Plan by checking the appropriate box;

 

(ii)                                  Review the certification in Item 4 of the Ballot and provide the requested information, if applicable, concerning all other Class 6B Other General Unsecured Claims for which you have submitted ballots in addition to this Ballot; and

 

(iii)                               Review and sign the certifications in Item 5 of the Ballot. Please be sure to sign and date your Ballot. Your original signature is required in order for your vote to be counted. If you are completing the Ballot on behalf of an entity, indicate your relationship with such entity and the capacity in which you are signing, and if requested, provide proof of your authorization to so sign. If your Class 6B Other General Unsecured Claim is held by a partnership, your Ballot must be executed in the name of the partnership by a general partner. If your Class 6B Other General Unsecured Claim is held by a corporation, your Ballot must be executed by an officer. In addition, please provide your name and mailing address if different from that set forth on the attached mailing label or if no such mailing label is attached to the Ballot.

 

2.                                      If you voted to reject the Plan, review the opt-in election disclosure in Item 3 of the Ballot, and determine whether you will check the box to opt into the Plan’s release provisions by checking the box in Item 3.

 

3.                                      To have your vote counted, you must complete, sign and return this Ballot to your Nominee prior to the Voting Deadline. IF YOU RECEIVED A RETURN ENVELOPE ADDRESSED TO YOUR NOMINEE OR OTHER INSTRUCTIONS FROM YOUR NOMINEE, PLEASE ALLOW SUFFICIENT TIME FOR YOUR NOMINEE TO PROCESS YOUR VOTE ON A MASTER BALLOT AND RETURN THE MASTER BALLOT SO THAT IT IS ACTUALLY RECEIVED BY THE SOLICITATION AGENT BEFORE THE VOTING DEADLINE.

 

4.                                      A properly completed, executed and timely-returned Ballot that either (a) indicates both an acceptance and rejection of the Plan, or (b) fails to indicate either an acceptance or rejection of the Plan will not be counted.

 

8

 

5.                                      If you hold Claims in more than one voting Class under the Plan, you should receive a ballot for each such category of Claims, coded by Class number and description, and a set of solicitation materials with respect to each such Claim. Each ballot you receive is for voting only your Claim described in that ballot. Please complete and return each ballot you receive. The attached Ballot is designated only for voting Class 6B Other General Unsecured Claims related to the Convertible Notes.

 

6.                                      You must vote all your Claims within a single Class under the Plan either to accept or reject the Plan. If you hold your Class 6B Other General Unsecured Claims through more than one Nominee, you must execute a separate ballot for each block of Convertible Notes; provided, however, that you must vote all of your Class 6B Other General Unsecured Claims in the same manner (i.e., to either accept or reject the Plan). Accordingly, a ballot (or multiple ballots with respect to Claims within a single Class) that partially rejects and partially accepts the Plan will not be counted.

 

7.                                      If you cast more than one Ballot voting the same Claim prior to the Voting Deadline, the last valid Ballot timely received shall be deemed to reflect the voter’s intent and shall supersede and revoke any earlier received Ballot. If you simultaneously cast inconsistent duplicate Ballots with respect to the same Claim, such Ballots shall not be counted.

 

8.                                      Any Ballot that is illegible or that contains insufficient information to permit the identification of the claimant will not be counted.

 

9.                                      This Ballot does not constitute, and shall not be deemed to be, a proof of claim or equity interest or an assertion or admission of a Claim or an Interest.

 

10.                               It is important that you vote. The Plan can be confirmed by the Bankruptcy Court and thereby made binding on you if it is accepted by the holders of at least two-thirds in amount and one-half in number of the Claims in each impaired Class who vote on the Plan and if the Plan otherwise satisfies the applicable requirements of section 1129(a) of title 11 of the United States Code (the “Bankruptcy Code”). The votes of Claims actually voted in your Class will bind both those who vote and those who do not vote. If the requisite acceptances are not obtained, the Bankruptcy Court nonetheless may confirm the Plan if it finds that the Plan: (a) provides fair and equitable treatment to, and does not unfairly discriminate against, the Class or Classes voting to reject the Plan; and (b) otherwise satisfies the requirements of section 1129(b) of the Bankruptcy Code.

 

11.                               This Ballot is not a letter of transmittal and may not be used for any purposes other than to cast a vote to accept or reject the Plan. Holders should not surrender, at this time, certificates (if any) representing their securities. No party will accept delivery of any such certificates surrendered together with this Ballot.

 

12.                               NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR ADVICE, OR TO MAKE ANY REPRESENTATION, OTHER THAN WHAT IS CONTAINED IN THE MATERIALS MAILED WITH THIS BALLOT OR OTHER SOLICITATION MATERIALS APPROVED BY THE BANKRUPTCY COURT, INCLUDING, WITHOUT LIMITATION, THE DISCLOSURE STATEMENT.

 

9

 

13.                               PLEASE RETURN YOUR BALLOT TO YOUR NOMINEE PROMPTLY.

 

IF YOU HAVE ANY QUESTIONS REGARDING THIS BALLOT OR THE PROCEDURES GENERALLY, OR IF YOU NEED ADDITIONAL COPIES OF THE BALLOT OR OTHER ENCLOSED MATERIALS, PLEASE CONTACT YOUR NOMINEE, OR PRIME CLERK AT 844-627-5368 OR FOR INTERNATIONAL CALLS AT 347-292-3524 OR VIA EMAIL AT AEGERIONBALLOTS@PRIMECLERK.COM.

 

10

 

	
UNITED   STATES BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF   NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion   Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632   (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

BALLOT FOR CLASS 6B (OTHER GENERAL UNSECURED CLAIMS) FOR

ACCEPTING OR REJECTING THE DEBTORS’ FIRST AMENDED

JOINT CHAPTER 11 PLAN

 

TO BE COUNTED, YOUR VOTE MUST BE ACTUALLY RECEIVED BY THE SOLICITATION AGENT BY AUGUST 15, 2019, AT 4:00 P.M. (PREVAILING EASTERN TIME).

 

This ballot (the “Ballot”) is being submitted to you by Aegerion Pharmaceuticals, Inc. and Aegerion Pharmaceuticals Holdings, Inc. as debtors and debtors in possession in the above-captioned cases (the “Debtors”) to solicit your vote to accept or reject the Debtors’ First Amended Joint Chapter 11 Plan [Docket No. 180] (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Plan”).(2)

 

The Bankruptcy Court has approved the Debtors’ Disclosure Statement for First Amended Joint Chapter 11 Plan [Docket No. 182] (including all exhibits thereto and as may be further amended, modified or supplemented from time to time, the “Disclosure Statement”). The Disclosure Statement describes the Plan and provides information to assist you in deciding how to vote your Ballot. Bankruptcy Court approval of the Disclosure Statement does not indicate Bankruptcy Court approval of the Plan.

 

If you do not have a Disclosure Statement, you may obtain a copy free of charge on the dedicated webpage of Prime Clerk LLC, the Debtors’ court-approved solicitation agent (the “Solicitation Agent”) in these cases, at http://primeclerk.com/aegerion. A copy of the Disclosure Statement is also available: (a) at the Office of the Clerk of the Bankruptcy Court; (b) on the Bankruptcy Court’s website, http://www.nysb.uscourts.gov (a PACER account is required); (c) upon written request to the Solicitation Agent at Aegerion Pharmaceuticals, Inc. Ballot Processing Center, c/o Prime Clerk LLC, One Grand Central, 60 East 42nd Street, Suite 1440, New

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 Capitalized terms used in this Ballot that are not otherwise defined herein have the meanings given to them in the Plan.

 

 

York, NY 10165; or (d) by contacting the Solicitation Agent via telephone at 844-627-5368 or for international calls at 347-292-3524 or via email at aegerionballots@primeclerk.com.

 

IMPORTANT

 

You should review the Disclosure Statement and the Plan before you vote. You may wish to seek legal advice concerning the Plan and your classification and treatment under the Plan. Your Claim has been placed in Class 6B Other General Unsecured Claims under the Plan. If you hold Claims in more than one Class under the Plan, you will receive a ballot for each Class in which you are entitled to vote.

 

If your Ballot is not actually received by the Balloting Agent on or before August 15, 2019 at 4:00 p.m. (prevailing Eastern Time), and such deadline is not extended, your vote will not count as either an acceptance or rejection of the Plan.

 

If the Plan is confirmed by the Bankruptcy Court it will be binding on you whether or not you vote.

 

Your receipt of this Ballot and the enclosed tax form does not signify that your Claim(s) has been or will be Allowed. The Debtors reserve all rights to dispute such Claim(s).

 

You may return your Ballot either (a) through Prime Clerk’s E-Ballot platform, located at http://cases.primeclerk.com/aegerion, or (b) by sending it and the enclosed tax form in the return envelope provided in your package to:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

If you submit your vote through the E-Ballot platform, you should not return a paper ballot. However, please return the enclosed tax form regardless of whether you vote through the E-Ballot platform as this will assist the Debtors in effectuating distributions to the extent you have an Allowed Claim.

 

2

 

HOW TO VOTE ONLINE THROUGH PRIME CLERK’S E-BALLOT PLATFORM

 

You may submit your ballot electronically by clicking on the “Submit E-Ballot” section on the Solicitation Agent’s website for these cases, located at http://cases.primeclerk.com/aegerion, and following the directions set forth on the website regarding submitting your E-Ballot as described more fully below.

 

1.                                      Please visit the Debtors’ voting website at http://cases.primeclerk.com/aegerion.

 

2.                                      Click on the “E-Ballot” section of the Debtors’ voting website.

 

3.                                      Follow the directions to submit your E-Ballot. If you choose to submit your Ballot via Prime Clerk’s E-Ballot system, you should not return a hard copy of your Ballot.

 

IMPORTANT NOTE: YOU WILL NEED THE FOLLOWING INFORMATION TO RETRIEVE AND SUBMIT YOUR CUSTOMIZED E-BALLOT:

 

UNIQUE E-BALLOT ID#

 

PLEASE CHOOSE ONLY ONE METHOD OF RETURN FOR YOUR BALLOT. IF YOU CAST BOTH AN E-BALLOT AND A PAPER BALLOT WITH RESPECT TO THE SAME CLAIM, THE PAPER BALLOT WILL NOT BE COUNTED.

 

“E-BALLOTING” IS THE SOLE MANNER IN WHICH BALLOTS MAY BE DELIVERED VIA ELECTRONIC TRANSMISSION.

 

BALLOTS SUBMITTED BY FACSIMILE OR EMAIL WILL NOT BE COUNTED UNLESS APPROVED BY THE DEBTORS.

 

PLEASE RETURN THE ENCLOSED TAX FORM REGARDLESS OF WHETHER YOU VOTE THROUGH THE E-BALLOT PLATFORM AS THIS WILL ASSIST THE DEBTORS IN EFFECTUATING DISTRIBUTIONS TO THE EXTENT YOU HAVE AN ALLOWED CLAIM.

 

ACCEPTANCE OR REJECTION OF THE PLAN

 

Item 1.         Vote Amount.

 

For purposes of voting to accept or reject the Plan, as of 5:00 p.m. (prevailing Eastern Time) on July 11, 2019 (the “Voting Record Date”), the undersigned (the “Claimant”) was a holder of a Class 6B Other General Unsecured Claim in the aggregate amount set forth below.

 

$

 

3

 

Item 2.         Vote on Plan.

 

CHECK ONE BOX ONLY

 

o                                    ACCEPTS (votes FOR) the Plan.

 

o                                    REJECTS (votes AGAINST) the Plan.

 

IMPORTANT INFORMATION REGARDING THE RELEASES

 

Following confirmation, subject to Article XII of the Plan, the Plan will be substantially consummated on the Effective Date. Among other things, effective as of the Confirmation Date but subject to the occurrence of the Effective Date, certain release, injunction, exculpation and discharge provisions set forth in Article XII of the Plan will become effective. In determining how to cast your vote on the Plan, it is important to read the provisions contained in Article XII of the Plan very carefully so that you understand how confirmation and substantial consummation of the Plan — which effectuates such provisions — will affect you and any Claim(s) you may hold against the Debtors and/or certain other Released Parties specified in the Plan.(3)

 

Specifically, except as otherwise set forth in the Plan or Confirmation Order, the releases in Section 12.6 of the Plan (the “Releases”) bind (a) each holder of a Claim that voted to accept the Plan, (b) each Released Party, and (c) to the fullest extent permissible under applicable law, as such law may be extended or interpreted subject to the Effective Date, (i) all holders of a Claim who vote to reject the Plan and “opt in” to the Releases, (ii) all holders of a Claim or Interest who are not entitled to vote to accept or reject the Plan and “opt in” to the Releases, or (iii) all other holders of a Claim or Interest who elect to “opt in” to the Releases. The Releases provide for, among other things, the following:

 

Releases by the Debtors. Except as otherwise provided in the Plan or the Confirmation Order, as of the Effective Date, the Debtors, as, debtors in possession, and any person seeking

 

(3)                                 As used herein and in the Plan, the term “Released Parties” means, collectively, and each solely in its capacity as such: (a) the Debtors, their respective non-Debtor subsidiaries, and the Reorganized Debtors; (b) Novelion; (c) the DIP Administrative Agent and the DIP Lenders; (d) the Bridge Loan Administrative Agent; (e) the Convertible Notes Trustee; (f) the Bridge Loan Lenders; (g) the Consenting Lenders; (h) the members of the Ad Hoc Group; (i) the Plan Investor; (j) the Committee and each of its current and former members solely in their capacity as members of the Committee; (k) each of such parties’ respective predecessors, successors, assigns, subsidiaries, owners, affiliates, managed accounts, funds or funds under common management; and (l) each of the foregoing parties’ (described in clauses (a)-(k)) respective current and former officers, directors, managers, managing members, employees, members, principals, shareholders, agents, advisory board members, management companies, fund advisors, partners, attorneys, financial advisors or other professionals or representatives, together with their successors and assigns, in each case solely in their capacity as such; provided, however, that former directors, officers and employees of the Debtors shall not be deemed Released Parties; provided  further that such attorneys and professional advisors shall only include those that provided services related to the Chapter 11 Cases and the transactions contemplated by this Plan (and do not include the attorneys and law firms retained by the Debtors in the ordinary course of business during these Chapter 11 Cases); provided, further, that no Person shall be a Released Party if it objects to the releases provided for in Article XII of this Plan.

 

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to exercise the rights of the Debtors’ Estates, including without limitation, any successor to the Debtors or any representative of the Debtors’ Estates appointed or selected pursuant to sections 1103, 1104 or 1123(b)(3) of the Bankruptcy Code or under chapter 7 of the Bankruptcy Code, shall be deemed to forever release, waive and discharge all claims (as such term “claim” is defined in section 101(5) of the Bankruptcy Code), obligations, suits, judgments, damages, demands, debts, rights, causes of action (including, but not limited to, the Causes of Action) and liabilities (other than the rights of the Debtors to enforce the Plan and the contracts, instruments, releases and other agreements or documents delivered thereunder) against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act, omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the purchase, sale or rescission of the purchase or sale of any security of the Debtors, the subject matter of, or the transactions or events giving rise to, any Claim or Interest that is treated in the Plan, the parties released pursuant to this Section 12.6, the Chapter 11 Cases, the RSA, the DIP Financing Agreement, the Plan Funding Agreement, or the Plan or the Disclosure Statement, and that could have been asserted by or on behalf of the Debtors or their Estates, whether directly, indirectly, derivatively or in any representative or any other capacity; provided, however, that in no event shall anything in this Section 12.06(a) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases in the Plan, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims released by the releases in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after reasonable investigation by the Debtors and after notice and opportunity for hearing; and (6) a bar to any of the Debtors asserting any claim released by the releases in the Plan against any of the Released Parties.

 

Third Party Releases. Except as otherwise provided in the Plan, the Plan Funding Agreement or the Confirmation Order, on the Effective Date each Releasing Party, in consideration for the obligations of the Debtors under the Plan, the distributions under the Plan and other contracts, instruments, releases, agreements or documents executed and delivered in connection with the Plan, will be deemed to have consented to the Plan and the restructuring embodied in the Plan for all purposes and deemed to forever release, waive and discharge all claims (as such term is defined in section 101(5) of the Bankruptcy Code), including but not limited to any claim sounding in law or equity or asserting a tort, breach of any duty or contract, violations of the common law, any federal or state statute, any federal or state securities laws or otherwise, demands, debts, rights, causes of action (including without limitation, the Causes of Action) or liabilities (other than the right to enforce the obligations of any party under the Plan and the contracts, instruments, releases, agreements and documents delivered under or in connection with the Plan), including, without limitation, any claims for any such loss such holder may suffer, have suffered or be alleged to suffer as a

 

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result of the Debtors commencing the Chapter 11 Cases or as a result of the Plan being consummated, against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act or omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the Chapter 11 Cases, the Plan or the Disclosure Statement; provided, however, that in no event shall anything in this Section 12.06(b) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases of holders of Claims and Interests, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after notice and opportunity for hearing; and (6) a bar to any holder of a Claim or Interest asserting any Claim released by the releases in the Plan against any of the Released Parties.

 

Notwithstanding anything to the contrary contained in the Plan: (i) except to the extent permissible under applicable law, as such law may be extended or interpreted subsequent to the Effective Date, the releases provided for in this Section 12.06 of the Plan shall not release any non-Debtor entity from any liability arising under (a) the Internal Revenue Code or any state, city or municipal tax code, (b) any criminal laws of the United States or any state, city or municipality, or (c) any environmental laws of the United States or any state, city or municipal tax code; and (ii) the releases set forth in this Section 12.06 shall not release any (a) claims, right, or Causes of Action for money borrowed from or owed to the Debtors by any of their directors, officers or former employees, as set forth in the Debtors’ books and records, (b) any claims against any Person to the extent such Person asserts a crossclaim, counterclaim and/or claim for setoff which seeks affirmative relief against a Debtor or any of its officers, directors, or representatives, (c) claims against any Person arising from or relating to such Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order of the Bankruptcy Court, and (d) any Unimpaired Claims unless and until holders of Unimpaired Claims have received payment on account of such Claims that render such claims Unimpaired in accordance with the Plan.

 

Notwithstanding any language to the contrary contained in this Disclosure Statement, Plan, and/or the Confirmation Order, no provision of the Plan or the Confirmation Order shall (i) preclude the SEC from enforcing its police or regulatory powers; or (ii) enjoin, limit, impair, or delay the SEC from commencing or continuing any claims, causes of action, proceedings or investigations against any non-Debtor person or non-Debtor entity in any forum.

 

As to any Governmental Unit (as defined in section 101(27) of the Bankruptcy Code), nothing in the Plan, Plan Documents, or Confirmation Order shall limit or expand the scope of discharge, release or injunction to which the Debtors or Reorganized Debtors are entitled under the Bankruptcy Code, if any. The discharge, release, and injunction provisions

 

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contained in the Plan, Plan Documents, or Confirmation Order are not intended and shall not be construed to bar any Governmental Unit from, subsequent to the Confirmation Order, pursuing any police or regulatory action.

 

Accordingly, notwithstanding anything contained in the Plan, Plan Documents, or Confirmation Order to the contrary, nothing in the Plan or Confirmation Order shall discharge, release, impair or otherwise preclude: (1) any liability to any Governmental Unit that is not a “claim” within the meaning of section 101(5) of the Bankruptcy Code; (2) any Claim of any Governmental Unit arising on or after the Confirmation Date; (3) any valid right of setoff or recoupment of any Governmental Unit against any of the Debtors; or (4) any liability of the Debtors or Reorganized Debtors under police or regulatory statutes or regulations to any Governmental Unit as the owner, lessor, lessee or operator of property that such entity owns, operates or leases after the Confirmation Date. Nor shall anything in the Plan, Plan Documents, or Confirmation Order: (i) enjoin or otherwise bar any Governmental Unit from asserting or enforcing, outside the Bankruptcy Court, any liability described in the preceding sentence; or (ii) divest any court, commission, or tribunal of jurisdiction to determine whether any liabilities asserted by any Governmental Unit are discharged or otherwise barred by the Plan, Plan Documents, Confirmation Order, or the Bankruptcy Code.

 

Moreover, nothing in the Plan, Plan Documents, or Confirmation Order shall release or exculpate any non-debtor, including any Released Parties and/or exculpated parties, from any liability to any Governmental Unit, including but not limited to any liabilities arising under the Internal Revenue Code, the environmental laws, or the criminal laws against the Released Parties and/or exculpated parties, nor shall anything in the Plan, Plan Documents, or Confirmation Order enjoin any Governmental Unit from bringing any claim, suit, action or other proceeding against any non-Debtor for any liability whatsoever; provided, however, that the foregoing sentence shall not limit the scope of discharge granted to the Debtors under sections 524 and 1141 of the Bankruptcy Code.

 

Nothing contained in the Plan, Plan Documents, or Confirmation Order shall be deemed to determine the tax liability of any person or entity, including but not limited to the Debtors and the Reorganized Debtors, nor shall the Plan, Plan Documents, or Confirmation Order be deemed to have determined the federal and/or state tax treatment of any item, distribution, or entity, including the federal and/or state tax consequences of the Plan and/or Plan Documents, nor shall anything in the Plan, Plan Documents, or Confirmation Order be deemed to have conferred jurisdiction upon the Bankruptcy Court to make determinations as to federal and/or state tax liability and federal and/or state tax treatment except as provided under 11 U.S.C. § 505.

 

Article X of the Plan regarding Executory Contracts and Unexpired Leases, and Section 7.8 of the Plan regarding Cancellation of Existing Securities and Agreements, shall not apply to the Government Settlement Agreements. The Government Settlement Agreements shall be unimpaired by the Plan, Plan Documents, and Confirmation Order, and shall remain obligations of the Debtors and/or the Reorganized Debtors, and all rights, obligations, and duties under the Government Settlement Agreements shall be preserved as if the Debtors’ bankruptcy cases were never filed. All Governmental Units reserve all rights with respect to the Government Settlement Agreements, and nothing contained in the Plan, Plan Documents,

 

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or Confirmation Order shall discharge, release, impair, or otherwise preclude any liability to any Governmental Unit arising from or relating to the Government Settlement Agreements. Any amounts owed to Governmental Units under the Government Settlement Agreements shall be paid in full when due in the ordinary course and nothing in the Plan, Plan Documents, or Confirmation Order shall be interpreted to set cure amounts, authorize the assignment or rejection of any Government Settlement Agreement, or require any Governmental Unit to approve of and consent to the assignment of any Government Settlement Agreement. The Debtors and Reorganized Debtors expressly agree that any provisions regarding default in the Government Settlement Agreements shall continue to apply as set forth in those agreements, irrespective of any provisions of the Plan, Plan Documents, and Confirmation Order. For the avoidance of doubt, nothing contained in the Plan, Plan Documents, or Confirmation Order shall divest any court, commission, or tribunal of jurisdiction over any matters related to the Government Settlement Agreements, or confer on the Bankruptcy Court jurisdiction over any matter related to the Government Settlement Agreements. Notwithstanding anything to the contrary in this paragraph, the provisions of this paragraph are subject to the provisions of Section 5.5 of the Plan regarding acceleration or increase of the monetary obligations under the Government Settlement Agreements.

 

The governmental units that are parties to the Government Settlement Agreements have not at this time sought to accelerate or increase payments under those agreements as a result of the filing of these Chapter 11 Cases or the consummation of the transactions contemplated by the Plan and the Plan Documents. The Debtors and certain of the governmental units that are parties to the Government Settlement Agreements are in discussions regarding the intentions of those parties regarding acceleration of the Debtors’ payment obligations under the Government Settlement Agreements. The Debtors and these parties to the Government Settlement Agreements anticipate reaching resolution on this issue before the Plan is confirmed.

 

Item 3.         Opt-In Election (for holders of Class 6B Other General Unsecured Claims that abstain from voting or vote to REJECT the Plan only)

 

If you did not vote to accept the Plan in Item 2, either because you abstained from voting on the Plan or voted to reject the Plan, you are still entitled to opt into the releases set forth in Article XII of the Plan by making such election below. DO NOT COMPLETE THE FOLLOWING ELECTION IF YOU VOTED TO ACCEPT THE PLAN IN ITEM 2. PURSUANT TO THE TERMS OF THE PLAN, IF YOU VOTE TO ACCEPT THE PLAN YOU WILL BE DEEMED TO HAVE CONSENTED TO THE RELEASES SET FORTH IN ARTICLE XII OF THE PLAN.

 

o                                    The undersigned elects to grant (OPTS IN TO) the Releases set forth in Section 12.6 of the Plan.

 

Item 4.         Certification.

 

By signing this Ballot, the undersigned Claimant hereby certifies that: (a) on the Voting Record Date, it was the holder of the Class 6B Other General Unsecured Claim to which this Ballot pertains (or an authorized signatory for such holder); (b) it has full power and authority

 

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to vote to accept or reject the Plan; and (c) it had received a copy of the Disclosure Statement (including all exhibits thereto) and other solicitation materials. The undersigned understands that an otherwise properly completed, executed and timely-returned Ballot that does not indicate either acceptance or rejection of the Plan or indicates both acceptance and rejection of the Plan will not be counted. By signing this Ballot, the undersigned is also certifying that its vote on the Plan is subject to all the terms and conditions set forth in the Plan and the Disclosure Statement.

 

	
Name of Claimant:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name (if different from   Claimant):
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Title (if corporation   or partnership)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Dated:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Email:
    	
 
    	
 
    
						

 

PLEASE MAKE SURE YOU HAVE PROVIDED ALL INFORMATION REQUESTED IN THIS BALLOT. PLEASE READ AND FOLLOW THE INSTRUCTIONS SET FORTH BELOW CAREFULLY. PLEASE (A) SUBMIT YOUR BALLOT ELECTRONICALLY THROUGH THE SOLICITATION AGENT’S E-BALLOT PLATFORM, LOCATED AT HTTP://CASES.PRIMECLERK.COM/AEGERION AND RETURN YOUR TAX FORM TO THE SOLICITATION AGENT, OR (B) COMPLETE, SIGN AND DATE THIS BALLOT AND RETURN IT BY MAIL, HAND DELIVERY OR OVERNIGHT COURIER SO THAT IT IS RECEIVED BY THE SOLICITATION AGENT BY AUGUST 15, 2019 AT 4:00 P.M. (PREVAILING EASTERN TIME).

 

VOTING INSTRUCTIONS

 

1.                                      In order for your vote to count, you must:

 

(i)            In the boxes provided in Item 2 of the Ballot, indicate either acceptance or rejection of the Plan by checking the appropriate box; and

 

(ii)           Review and sign the certifications in Item 4 of the Ballot. Please be sure to sign and date your Ballot. Your original signature is required if you are voting by paper ballot in order for your vote to be counted. If you are completing the Ballot on behalf of an entity, indicate your relationship with such entity and the capacity in which you are signing, and if requested, provide proof of your authorization to so sign. In addition, please provide your name and mailing address if different from that set

 

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forth on the attached mailing label or if no such mailing label is attached to the Ballot.

 

2.                                      If you abstained from voting or voted to reject the Plan, review the opt-in election disclosure in Item 3 of the Ballot, and determine whether you will check the box to opt into the Plan’s release provisions by checking the box in Item 3.

 

3.                                      To have your vote counted, you must (a) submit your ballot electronically through the Solicitation Agent’s E-Ballot platform, located at http://cases.primeclerk.com/aegerion, or (b) complete, sign and return this paper Ballot so that it is actually  received by the Solicitation Agent not later than 4:00 p.m. (prevailing Eastern Time) on August 15, 2019. A PREPAID ENVELOPE ADDRESSED TO THE SOLICITATION AGENT IS ENCLOSED FOR YOUR CONVENIENCE. Return the completed Ballot and your tax form to:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

4.                                      DO NOT SUBMIT YOUR BALLOT BY FAX OR EMAIL. A ballot submitted by facsimile or email will not be counted unless approved by the Debtors.

 

5.                                      A properly completed, executed and timely-returned Ballot that either (a) indicates both an acceptance and rejection of the Plan, or (b) fails to indicate either an acceptance or rejection of the Plan will not be counted.

 

6.                                      If you hold Claims in more than one voting Class under the Plan, you should receive a ballot for each such category of Claims, coded by Class number and description, and a set of solicitation materials with respect to each such Claim. Each ballot you receive is for voting only your Claim described in that ballot. Please complete and return each ballot you receive. The attached Ballot is designated only for voting Class 6B Other General Unsecured Claims.

 

7.                                      You must vote all your Claims within a single Class under the Plan either to accept or reject the Plan. Accordingly, a Ballot (or multiple Ballots with respect to multiple Claims within a single Class) that partially rejects and partially accepts the Plan will not be counted.

 

8.                                      If you cast more than one Ballot voting the same Claim prior to the Voting Deadline, the last valid Ballot timely received shall be deemed to reflect the voter’s intent and shall

 

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supersede and revoke any earlier received Ballot. If you simultaneously cast inconsistent duplicate Ballots with respect to the same Claim, such Ballots shall not be counted.

 

9.                                      Any Ballot that is illegible or that contains insufficient information to permit the identification of the claimant will not be counted.

 

10.                               This Ballot does not constitute, and shall not be deemed to be, a proof of claim or equity interest or an assertion or admission of a Claim or an Interest.

 

11.                               Subject to the requirements of, and compliance with, Bankruptcy Rule 3018, if you have delivered a valid Ballot for the acceptance or rejection of the Plan, you may withdraw such acceptance or rejection by delivering a written notice of withdrawal to the Balloting Agent at any time prior to the Voting Deadline. A notice of withdrawal to be valid, must (i) describe the Claim, (ii) be signed by the creditor in the same manner as the Ballot was originally signed, and (iii) be received by the Balloting Agent on or before the Voting Deadline. The Debtors reserve the absolute right to contest the validity of any such withdrawals of Ballots.

 

12.                               It is important that you vote. The Plan can be confirmed by the Bankruptcy Court and thereby made binding on you if it is accepted by the holders of at least two-thirds in amount and one-half in number of the Claims in each impaired Class who vote on the Plan and if the Plan otherwise satisfies the applicable requirements of section 1129(a) of title 11 of the United States Code (the “Bankruptcy Code”). The votes of Claims actually voted in your Class will bind both those who vote and those who do not vote. If the requisite acceptances are not obtained, the Bankruptcy Court nonetheless may confirm the Plan if it finds that the Plan: (a) provides fair and equitable treatment to, and does not unfairly discriminate against, the Class or Classes voting to reject the Plan; and (b) otherwise satisfies the requirements of section 1129(b) of the Bankruptcy Code.

 

13.                               This Ballot is not a letter of transmittal and may not be used for any purposes other than to cast a vote to accept or reject the Plan. Holders should not surrender, at this time, certificates (if any) representing their securities. No party will accept delivery of any such certificates surrendered together with this Ballot.

 

14.                               NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR ADVICE, OR TO MAKE ANY REPRESENTATION, OTHER THAN WHAT IS CONTAINED IN THE MATERIALS MAILED WITH THIS BALLOT OR OTHER SOLICITATION MATERIALS APPROVED BY THE BANKRUPTCY COURT, INCLUDING, WITHOUT LIMITATION, THE DISCLOSURE STATEMENT.

 

15.                               PLEASE RETURN YOUR BALLOT AND TAX FORM PROMPTLY.

 

IF YOU HAVE ANY QUESTIONS REGARDING THIS BALLOT OR THE PROCEDURES GENERALLY, OR IF YOU NEED ADDITIONAL COPIES OF THE BALLOT OR OTHER ENCLOSED MATERIALS, PLEASE CONTACT YOUR NOMINEE, OR PRIME CLERK AT 844-627-5368 OR FOR INTERNATIONAL CALLS AT 347-292-3524.

 

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UNITED   STATES BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF   NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion   Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632   (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

NOTICE OF (I) APPROVAL OF DISCLOSURE STATEMENT,

(II) HEARING TO CONSIDER CONFIRMATION OF THE PLAN, AND

(III) DEADLINE FOR FILING OBJECTIONS TO CONFIRMATION OF THE PLAN

 

TO:                   ALL UNIMPAIRED CREDITORS OF THE DEBTORS: HOLDERS OF CLASS 1 (PRIORITY NON-TAX CLAIMS), CLASS 2 (OTHER SECURED CLAIMS), CLASS 5 (GOVERNMENT SETTLEMENT CLAIMS), AND CLASS 6A (ONGOING TRADE CLAIMS)

 

PLEASE TAKE NOTICE OF THE FOLLOWING:

 

APPROVAL OF DISCLOSURE STATEMENT

 

1.                                      By order dated July 11, 2019, the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) approved the Disclosure Statement for Debtors’ First Amended Joint Chapter 11 Plan (including all exhibits thereto and as amended, modified or supplemented from time to time, the “Disclosure Statement”) as containing “adequate information” within the meaning of section 1125 of title 11 of the United States Code (the “Bankruptcy Code”).

 

CONFIRMATION HEARING

 

2.                                      Commencing on September 5, 2019 at 10:00 a.m. (prevailing Eastern Time), or as soon thereafter as counsel may be heard, a hearing (the “Confirmation Hearing”) will be held before the Honorable Martin Glenn, United States Bankruptcy Judge, in Courtroom 523 at the United States Bankruptcy Court for the Southern District of New York, 1 Bowling Green,New York, New York 10004 to consider confirmation of the Debtors’ First Amended Joint Chapter 11 Plan (including all exhibits thereto and as amended, modified or supplemented from time to time, the “Plan”).(2) The Confirmation Hearing may be adjourned from time to time without further notice to creditors or other parties in interest, other than by an announcement of

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 All capitalized terms used but not defined herein have the meanings given them in the Plan.

 

 

such an adjournment in open court at the Confirmation Hearing or any adjournment thereof or the filing of a notice or other appropriate filing with the Bankruptcy Court. The Plan may be modified in accordance with the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, the Plan and other applicable law, without further notice, prior to or as a result of the Confirmation Hearing.

 

ENTITLEMENT TO VOTE ON THE PLAN

 

3.                                      In accordance with the terms of the Plan and the Bankruptcy Code, only holders of claims against the debtors and debtors in possession in the above-captioned cases (collectively, the “Debtors”) that are impaired by and will receive a distribution under the Plan are entitled to vote on the Plan. However, holders of claims that are unimpaired by the Plan are deemed to have accepted the Plan and are not entitled to vote on the Plan.

 

4.                                      5:00 p.m. (prevailing Eastern Time) on July 11, 2019 has been established by the Bankruptcy Court as the record date for determining the creditors and interest holders entitled to receive solicitation or notice materials.

 

5.                                      You are receiving this Notice because you have been identified as holding a claim that is unimpaired. Therefore, you are deemed to accept the Plan and are not entitled to vote on the Plan.

 

IMPORTANT INFORMATION REGARDING THE RELEASES

 

Following confirmation, subject to Article XII of the Plan, the Plan will be substantially consummated on the Effective Date. Among other things, effective as of the Confirmation Date but subject to the occurrence of the Effective Date, certain release, injunction, exculpation and discharge provisions set forth in Article XII of the Plan will become effective. It is important to read the provisions contained in Article XII of the Plan very carefully so that you understand how confirmation and substantial consummation of the Plan — which effectuates such provisions — will affect you and any Claim(s) you may hold against the Debtors and/or certain other Released Parties specified in the Plan.(3)

 

(3)                                 As used herein and in the Plan, the term “Released Parties” means, collectively, and each solely in its capacity as such: (a) the Debtors, their respective non-Debtor subsidiaries, and the Reorganized Debtors; (b) Novelion; (c) the DIP Administrative Agent and the DIP Lenders; (d) the Bridge Loan Administrative Agent; (e) the Convertible Notes Trustee; (f) the Bridge Loan Lenders; (g) the Consenting Lenders; (h) the members of the Ad Hoc Group; (i) the Plan Investor; (j) the Committee and each of its current and former members solely in their capacity as members of the Committee; (k) each of such parties’ respective predecessors, successors, assigns, subsidiaries, owners, affiliates, managed accounts, funds or funds under common management; and (l) each of the foregoing parties’ (described in clauses (a)-(k)) respective current and former officers, directors, managers, managing members, employees, members, principals, shareholders, agents, advisory board members, management companies, fund advisors, partners, attorneys, financial advisors or other professionals or representatives, together with their successors and assigns, in each case solely in their capacity as such; provided, however, that former directors, officers and employees of the Debtors shall not be deemed Released Parties; provided further that such attorneys and professional advisors shall only include those that provided services related to the Chapter 11 Cases and the transactions contemplated by the Plan (and do not include the attorneys and law firms retained by the Debtors in the ordinary course of business during these Chapter 11 Cases); provided, further, that no Person shall be a Released Party if it objects to the releases provided for in Article XII of the Plan.

 

2

 

Specifically, except as otherwise set forth in the Plan or Confirmation Order, the releases in Section 12.6 of the Plan (the “Releases”) bind (a) each holder of a Claim that voted to accept the Plan, (b) each Released Party, and (c) to the fullest extent permissible under applicable law, as such law may be extended or interpreted subject to the Effective Date, (i) all holders of a Claim who vote to reject the Plan and “opt in” to the Releases, (ii) all holders of a Claim or Interest who are not entitled to vote to accept or reject the Plan and “opt in” to the Releases, or (iii) all other holders of a Claim or Interest who elect to “opt in” to the Releases. The Releases provide for, among other things, the following:

 

Third Party Releases. Except as otherwise provided in the Plan, the Plan Funding Agreement or the Confirmation Order, on the Effective Date each Releasing Party, in consideration for the obligations of the Debtors under the Plan, the distributions under the Plan and other contracts, instruments, releases, agreements or documents executed and delivered in connection with the Plan, will be deemed to have consented to the Plan and the restructuring embodied in the Plan for all purposes and deemed to forever release, waive and discharge all claims (as such term is defined in section 101(5) of the Bankruptcy Code), including but not limited to any claim sounding in law or equity or asserting a tort, breach of any duty or contract, violations of the common law, any federal or state statute, any federal or state securities laws or otherwise, demands, debts, rights, causes of action (including without limitation, the Causes of Action) or liabilities (other than the right to enforce the obligations of any party under the Plan and the contracts, instruments, releases, agreements and documents delivered under or in connection with the Plan), including, without limitation, any claims for any such loss such holder may suffer, have suffered or be alleged to suffer as a result of the Debtors commencing the Chapter 11 Cases or as a result of the Plan being consummated, against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act or omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the Chapter 11 Cases, the Plan or the Disclosure Statement; provided, however, that in no event shall anything in this Section 12.06(b) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases of holders of Claims and Interests, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after notice and opportunity for hearing; and (6) a bar to any holder of a Claim or Interest asserting any Claim released by the releases in the Plan against any of the Released Parties.

 

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Notwithstanding anything to the contrary contained in the Plan: (i) except to the extent permissible under applicable law, as such law may be extended or interpreted subsequent to the Effective Date, the releases provided for in this Section 12.06 of the Plan shall not release any non-Debtor entity from any liability arising under (a) the Internal Revenue Code or any state, city or municipal tax code, (b) any criminal laws of the United States or any state, city or municipality, or (c) any environmental laws of the United States or any state, city or municipal tax code; and (ii) the releases set forth in this Section 12.06 shall not release any (a) claims, right, or Causes of Action for money borrowed from or owed to the Debtors by any of their directors, officers or former employees, as set forth in the Debtors’ books and records, (b) any claims against any Person to the extent such Person asserts a crossclaim, counterclaim and/or claim for setoff which seeks affirmative relief against a Debtor or any of its officers, directors, or representatives, (c) claims against any Person arising from or relating to such Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order of the Bankruptcy Court, and (d) any Unimpaired Claims unless and until holders of Unimpaired Claims have received payment on account of such Claims that render such claims Unimpaired in accordance with the Plan.

 

Notwithstanding any language to the contrary contained in this Disclosure Statement, Plan, and/or the Confirmation Order, no provision of the Plan or the Confirmation Order shall (i) preclude the SEC from enforcing its police or regulatory powers; or (ii) enjoin, limit, impair, or delay the SEC from commencing or continuing any claims, causes of action, proceedings or investigations against any non-Debtor person or non-Debtor entity in any forum.

 

As to any Governmental Unit (as defined in section 101(27) of the Bankruptcy Code), nothing in the Plan, Plan Documents, or Confirmation Order shall limit or expand the scope of discharge, release or injunction to which the Debtors or Reorganized Debtors are entitled under the Bankruptcy Code, if any. The discharge, release, and injunction provisions contained in the Plan, Plan Documents, or Confirmation Order are not intended and shall not be construed to bar any Governmental Unit from, subsequent to the Confirmation Order, pursuing any police or regulatory action.

 

Accordingly, notwithstanding anything contained in the Plan, Plan Documents, or Confirmation Order to the contrary, nothing in the Plan or Confirmation Order shall discharge, release, impair or otherwise preclude: (1) any liability to any Governmental Unit that is not a “claim” within the meaning of section 101(5) of the Bankruptcy Code; (2) any Claim of any Governmental Unit arising on or after the Confirmation Date; (3) any valid right of setoff or recoupment of any Governmental Unit against any of the Debtors; or (4) any liability of the Debtors or Reorganized Debtors under police or regulatory statutes or regulations to any Governmental Unit as the owner, lessor, lessee or operator of property that such entity owns, operates or leases after the Confirmation Date. Nor shall anything in the Plan, Plan Documents, or Confirmation Order: (i) enjoin or otherwise bar any Governmental Unit from asserting or enforcing, outside the Bankruptcy Court, any liability described in the preceding sentence; or (ii) divest any court, commission, or tribunal of jurisdiction to determine whether any liabilities asserted by any Governmental Unit are discharged or otherwise barred by the Plan, Plan Documents, Confirmation Order, or the Bankruptcy Code.

 

4

 

Moreover, nothing in the Plan, Plan Documents, or Confirmation Order shall release or exculpate any non-debtor, including any Released Parties and/or exculpated parties, from any liability to any Governmental Unit, including but not limited to any liabilities arising under the Internal Revenue Code, the environmental laws, or the criminal laws against the Released Parties and/or exculpated parties, nor shall anything in the Plan, Plan Documents, or Confirmation Order enjoin any Governmental Unit from bringing any claim, suit, action or other proceeding against any non-Debtor for any liability whatsoever; provided, however, that the foregoing sentence shall not limit the scope of discharge granted to the Debtors under sections 524 and 1141 of the Bankruptcy Code.

 

Nothing contained in the Plan, Plan Documents, or Confirmation Order shall be deemed to determine the tax liability of any person or entity, including but not limited to the Debtors and the Reorganized Debtors, nor shall the Plan, Plan Documents, or Confirmation Order be deemed to have determined the federal and/or state tax treatment of any item, distribution, or entity, including the federal and/or state tax consequences of the Plan and/or Plan Documents, nor shall anything in the Plan, Plan Documents, or Confirmation Order be deemed to have conferred jurisdiction upon the Bankruptcy Court to make determinations as to federal and/or state tax liability and federal and/or state tax treatment except as provided under 11 U.S.C. § 505.

 

Article X of the Plan regarding Executory Contracts and Unexpired Leases, and Section 7.8 of the Plan regarding Cancellation of Existing Securities and Agreements, shall not apply to the Government Settlement Agreements. The Government Settlement Agreements shall be unimpaired by the Plan, Plan Documents, and Confirmation Order, and shall remain obligations of the Debtors and/or the Reorganized Debtors, and all rights, obligations, and duties under the Government Settlement Agreements shall be preserved as if the Debtors’ bankruptcy cases were never filed. All Governmental Units reserve all rights with respect to the Government Settlement Agreements, and nothing contained in the Plan, Plan Documents, or Confirmation Order shall discharge, release, impair, or otherwise preclude any liability to any Governmental Unit arising from or relating to the Government Settlement Agreements. Any amounts owed to Governmental Units under the Government Settlement Agreements shall be paid in full when due in the ordinary course and nothing in the Plan, Plan Documents, or Confirmation Order shall be interpreted to set cure amounts, authorize the assignment or rejection of any Government Settlement Agreement, or require any Governmental Unit to approve of and consent to the assignment of any Government Settlement Agreement. The Debtors and Reorganized Debtors expressly agree that any provisions regarding default in the Government Settlement Agreements shall continue to apply as set forth in those agreements, irrespective of any provisions of the Plan, Plan Documents, and Confirmation Order. For the avoidance of doubt, nothing contained in the Plan, Plan Documents, or Confirmation Order shall divest any court, commission, or tribunal of jurisdiction over any matters related to the Government Settlement Agreements, or confer on the Bankruptcy Court jurisdiction over any matter related to the Government Settlement Agreements. Notwithstanding anything to the contrary in this paragraph, the provisions of this paragraph are subject to the provisions of Section 5.5 of the Plan regarding acceleration or increase of the monetary obligations under the Government Settlement Agreements.

 

5

 

The governmental units that are parties to the Government Settlement Agreements have not at this time sought to accelerate or increase payments under those agreements as a result of the filing of these Chapter 11 Cases or the consummation of the transactions contemplated by the Plan and the Plan Documents. The Debtors and certain of the governmental units that are parties to the Government Settlement Agreements are in discussions regarding the intentions of those parties regarding acceleration of the Debtors’ payment obligations under the Government Settlement Agreements. The Debtors and these parties to the Government Settlement Agreements anticipate reaching resolution on this issue before the Plan is confirmed.

 

6

 

HOW TO OPT INTO THE RELEASES BY MAIL

 

1.              If you wish to make an election to opt into the Releases contained in section 12.6(b) of the Plan set forth above, check the box in Item 1 below.

 

2.              Review the certifications contained in Item 2 below.

 

3.              Sign and date this Notice of Non-Voting Status and Opt-In Form and fill out the other required information in the applicable area below.

 

4.              In order for your election to opt into the Releases by mail to be counted, your Notice of Non-Voting Status and Opt-In Form must be properly completed and actually received by the Debtors’ solicitation agent, Prime Clerk LLC (the “Solicitation Agent”), no later than August 15, 2019, at 4:00 p.m. (prevailing Eastern Time). You may use the postage-paid envelope provided or send your Notice of Non-Voting Status and Opt-In Form to the following address:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10022

 

HOW TO OPT IN TO THE RELEASES ONLINE

 

You may submit your ballot electronically by clicking on the “Submit E-Ballot” section on the Solicitation Agent’s website for these cases, located at http://cases.primeclerk.com/aegerion, and following the directions set forth on the website regarding submitting your E-Ballot as described more fully below.

 

1.                                      Please visit the Debtors’ voting website at http://cases.primeclerk.com/aegerion.

 

2.                                      Click on the “E-Ballot” section of the Debtors’ voting website.

 

3.                                      Follow the directions to submit your Notice of Non-Voting Status and Opt-In Form. If you choose to submit your Notice of Non-Voting Status and Opt-In Form via Prime Clerk’s E-Ballot system, you should not return a hard copy of your Notice of Non-Voting Status and Opt-In Form.

 

E-Ballot ID:

 

“E-BALLOTING” IS THE SOLE MANNER IN WHICH NOTICES OF NON-VOTING STATUS AND OPT-IN FORMS MAY BE DELIVERED VIA ELECTRONIC TRANSMISSION.

 

NOTICES OF NON-VOTING STATUS AND OPT-IN FORMS SUBMITTED BY FACSIMILE OR EMAIL WILL NOT BE COUNTED.

 

Item 1.         Release.

 

PLEASE TAKE NOTICE THAT YOU MAY CHECK THE BOX BELOW TO OPT INTO THE RELEASE PROVISIONS CONTAINED IN SECTION 12.6(b) OF THE

 

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PLAN AND SET FORTH ABOVE. IF YOU OPT INTO THE RELEASE PROVISIONS BY CHECKING THE BOX BELOW AND PROPERLY AND TIMELY SUBMITTING THIS NOTICE OF NON-VOTING STATUS AND OPT-IN FORM, YOU WILL BE DEEMED TO HAVE UNCONDITIONALLY, IRREVOCABLY AND FOREVER RELEASED AND DISCHARGED THE RELEASED PARTIES AS SET FORTH IN SECTION 12.6(b) OF THE PLAN.

 

o                                    OPT IN TO RELEASE.

 

Item 2.         Certification.

 

By returning this Notice of Non-Voting Status and Opt-In Form, the holder of the unimpaired Claim(s) identified below certifies that (a) it was the holder of the unimpaired Claim(s) as of the Record Date and/or it has full power and authority to opt into the Release for the unimpaired Claim(s) identified below with respect to such unimpaired Claim(s), and (b) it understands the scope of the Releases.

 

	
Name of Holder:
    	
 
    
	
 
    	
(Print or Type)
    
	
Signature:
    	
 
    
	
 
    	
 
    
	
Name of Signatory:
    	
 
    
	
 
    	
(If other than   Holder)
    
	
Title:
    	
 
    
	
 
    	
 
    
	
Address:
    	
 
    
	
 
    	
 
    
	
Phone Number:
    	
 
    
	
 
    	
 
    
	
Email:
    	
 
    
	
 
    	
 
    
	
Date Completed:
    	
 
    

 

DEADLINE FOR OBJECTIONS TO CONFIRMATION OF THE PLAN

 

6.                                      Objections, if any, to confirmation of the Plan, including any supporting memoranda, must be in writing, filed with the Clerk of the Bankruptcy Court, together with proof of service, at 1 Bowling Green, New York, New York 10004, or electronically using the Bankruptcy Court’s Case Management/Electronic Case File (“CM/ECF”) System at https://ecf.nysb.uscourts.gov (a CM/ECF password will be required), in each case, with a hard copy delivered to the Judge’s Chambers, and must: (a) state the name and address of the

 

8

 

objecting party and the amount of its claim or the nature of its interest in the Debtors’ chapter 11 cases; (b) state with particularity the provision or provisions of the Plan objected to and for any objection asserted, the legal and factual basis for such objections; (c) provide proposed language to remedy any objection asserted, if possible; and (d) be served by hand delivery or in a manner as will cause such objection to be received on or before August 22, 2019 4:00 p.m. (prevailing Eastern Time), by: (i) Aegerion Pharmaceuticals, Inc., 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142 (Attn: John R. Castellano); (ii) counsel to the Debtors, Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, NY 10019 (Attn: Paul V. Shalhoub, Esq. and Andrew S. Mordkoff, Esq.); (iii) counsel to those certain lenders under the Debtors’ debtor-in-possession financing facility, the Debtors’ prepetition secured bridge loan credit agreement and the Debtors’ 2% unsecured convertible notes, Latham & Watkins LLP, 330 North Wabash Avenue, Suite 2800, Chicago, IL 60611 (Attn: Richard A. Levy, Esq.) and King & Spalding LLP, 444 West Lake Street, Suite 1650, Chicago, IL 60606 (Attn: Matthew L. Warren, Esq.); (iv) counsel to the Official Committee of Unsecured Creditors, Kramer Levin Naftalis & Frankel LLP, 1177 Avenue of the Americas, New York, NY 10036 (Attn: Kenneth H. Eckstein, Esq. and Rachael Ringer, Esq.); (v) counsel to the United States Trustee for Region 2, 201 Varick Street, Suite 1006, New York, NY 10014 (Attn: Benjamin J. Higgins, Esq. and Brian S. Masumoto, Esq.); (vi) counsel to Novelion Therapeutics Inc., Goodwin Procter LLP, The New York Times Building, 620 Eighth Avenue, New York, NY 10018 (Attn: Gregory Fox, Esq. and Jacqueline Mercier, Esq.); and (vii) counsel to Amryt Pharma Plc, Gibson, Dunn & Crutcher LLP, 200 Park Avenue, New York, NY 10166 (Attn: Matthew J. Williams, Esq. and Jason Zachary Goldstein, Esq.). Any objections not filed and served as set forth above will be deemed waived.

 

COPIES OF THE PLAN AND DISCLOSURE STATEMENT

 

7.                                      The Disclosure Statement and the Plan are on file with the Clerk of the Bankruptcy Court, and copies of the same may be obtained by parties in interest free of charge on the dedicated webpage related to these cases of the Debtors’ Balloting Agent, Prime Clerk LLC (http://cases.primeclerk.com/aegerion). Copies of the Disclosure Statement are also available for inspection during regular business hours at the office of the Clerk of the Bankruptcy Court, 1 Bowling Green, New York, New York 10004. In addition, copies of the Disclosure Statement may be viewed on the internet at the Bankruptcy Court’s website (http://www.nysb.uscourts.gov) by following the directions for accessing the ECF system on such website. Hard copies of the Disclosure Statement will be made available upon request made to the Debtors’ Claims Agent, Prime Clerk LLC, in writing at the following address: Aegerion Pharmaceuticals, Inc. Ballot Processing Center, c/o Prime Clerk LLC, One Grand Central Place, 60 East 42nd Street, Suite 1440, New York, NY 10165, or via telephone at 844-627-5368 or for international calls at 347-292-3524 or via email at: aegerionballots@primeclerk.com.

 

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Dated:  New York, New York
    	
 
    
	
July 11, 2019
    	
 
    
	
 
    	
 
    
	
 
    	
WILLKIE FARR &   GALLAGHER LLP
    
	
 
    	
Counsel   for the Debtors and Debtors in Possession
    
	
 
    	
 
    
	
 
    	
787 Seventh Avenue
    
	
 
    	
New York, New York   10019
    
	
 
    	
(212) 728-8000
    

 

10

 

	
UNITED   STATES BANKRUPTCY COURT
    	
 
    
	
SOUTHERN DISTRICT OF   NEW YORK
    	
 
    	
 
    
	
 
    	
x
    	
 
    
	
In re
    	
:
    	
Chapter 11
    
	
 
    	
:
    	
 
    
	
Aegerion   Pharmaceuticals, Inc., et  al.,(1)
    	
:
    	
Case No. 19-11632   (MG)
    
	
 
    	
:
    	
 
    
	
Debtors.
    	
:
    	
(Jointly Administered)
    
	
 
    	
x
    	
 
    

 

NOTICE OF (I) APPROVAL OF DISCLOSURE STATEMENT,

(II) HEARING TO CONSIDER CONFIRMATION OF THE PLAN, AND

(III) DEADLINE FOR FILING OBJECTIONS TO CONFIRMATION OF THE PLAN

 

TO:                   ALL HOLDERS OF CLASS 7 (EXISTING SECURITIES LAW CLAIMS) AND CLASS 8 (EXISTING INTERESTS)

 

PLEASE TAKE NOTICE OF THE FOLLOWING:

 

APPROVAL OF DISCLOSURE STATEMENT

 

1.                                      By order dated July 11, 2019, the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) approved the Disclosure Statement for Debtors’ First Amended Joint Chapter 11 Plan (including all exhibits thereto and as amended, modified or supplemented from time to time, the “Disclosure Statement”) as containing “adequate information” within the meaning of section 1125 of title 11 of the United States Code (the “Bankruptcy Code”).

 

CONFIRMATION HEARING

 

2.                                      Commencing on September 5, 2019 at 10:00 a.m. (prevailing Eastern Time), or as soon thereafter as counsel may be heard, a hearing (the “Confirmation Hearing”) will be held before the Honorable Martin Glenn, United States Bankruptcy Judge, in Courtroom 523 at the United States Bankruptcy Court for the Southern District of New York, 1 Bowling Green, New York, New York 10004 to consider confirmation of the Debtors’ First Amended Joint Chapter 11 Plan (including all exhibits thereto and as amended, modified or supplemented from time to time, the “Plan”).(2) The Confirmation Hearing may be adjourned from time to time without further notice to creditors or other parties in interest, other than by an announcement of such an adjournment in open court at the Confirmation Hearing or any adjournment thereof or the filing of a notice or other appropriate filing with the Bankruptcy Court. The Plan may be

 

(1)                                 The Debtors in these chapter 11 cases and the last four digits of each Debtor’s federal taxpayer identification number are Aegerion Pharmaceuticals, Inc. (0116), and Aegerion Pharmaceuticals Holdings, Inc. (1331). The Debtors’ executive headquarters are located at 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142.

 

(2)                                 All capitalized terms used but not defined herein have the meanings given them in the Plan.

 

 

modified in accordance with the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, the Plan and other applicable law, without further notice, prior to or as a result of the Confirmation Hearing.

 

ENTITLEMENT TO VOTE ON THE PLAN

 

3.                                      In accordance with the terms of the Plan and the Bankruptcy Code, only holders of claims against the debtors and debtors in possession in the above-captioned cases (collectively, the “Debtors”) that are impaired by and will receive a distribution under the Plan are entitled to vote on the Plan. However, holders of claims and interests that will receive no distribution under the Plan are deemed to have rejected the Plan and will not be entitled to vote on the Plan.

 

4.                                      5:00 p.m. (prevailing Eastern Time) on July 11, 2019 has been established by the Bankruptcy Court as the record date for determining the creditors and interest holders entitled to receive solicitation or notice materials.

 

5.                                      You are receiving this Notice because you have been identified as holding a claim or interest that is not receiving any distribution under the Plan. Therefore, you are deemed to reject the Plan and are not entitled to vote on the Plan.

 

IMPORTANT INFORMATION REGARDING THE RELEASES

 

Following confirmation, subject to Article XII of the Plan, the Plan will be substantially consummated on the Effective Date. Among other things, effective as of the Confirmation Date but subject to the occurrence of the Effective Date, certain release, injunction, exculpation and discharge provisions set forth in Article XII of the Plan will become effective. It is important to read the provisions contained in Article XII of the Plan very carefully so that you understand how confirmation and substantial consummation of the Plan — which effectuates such provisions — will affect you and any Claim(s) you may hold against the Debtors and/or certain other Released Parties specified in the Plan.(3)

 

(3)                                 As used herein and in the Plan, the term “Released Parties” means, collectively, and each solely in its capacity as such: (a) the Debtors, their respective non-Debtor subsidiaries, and the Reorganized Debtors; (b) Novelion; (c) the DIP Administrative Agent and the DIP Lenders; (d) the Bridge Loan Administrative Agent; (e) the Convertible Notes Trustee; (f) the Bridge Loan Lenders; (g) the Consenting Lenders; (h) the members of the Ad Hoc Group; (i) the Plan Investor; (j) the Committee and each of its current and former members solely in their capacity as members of the Committee; (k) each of such parties’ respective predecessors, successors, assigns, subsidiaries, owners, affiliates, managed accounts, funds or funds under common management; and (l) each of the foregoing parties’ (described in clauses (a)-(k)) respective current and former officers, directors, managers, managing members, employees, members, principals, shareholders, agents, advisory board members, management companies, fund advisors, partners, attorneys, financial advisors or other professionals or representatives, together with their successors and assigns, in each case solely in their capacity as such; provided, however, that former directors, officers and employees of the Debtors shall not be deemed Released Parties; provided  further that such attorneys and professional advisors shall only include those that provided services related to the Chapter 11 Cases and the transactions contemplated by the Plan (and do not include the attorneys and law firms retained by the Debtors in the ordinary course of business during these Chapter 11 Cases); provided, further, that no Person shall be a Released Party if it objects to the releases provided for in Article XII of the Plan.

 

2

 

Specifically, except as otherwise set forth in the Plan or Confirmation Order, the releases in Section 12.6 of the Plan (the “Releases”) bind (a) each holder of a Claim that voted to accept the Plan, (b) each Released Party, and (c) to the fullest extent permissible under applicable law, as such law may be extended or interpreted subject to the Effective Date, (i) all holders of a Claim who vote to reject the Plan and “opt in” to the Releases, (ii) all holders of a Claim or Interest who are not entitled to vote to accept or reject the Plan and “opt in” to the Releases, or (iii) all other holders of a Claim or Interest who elect to “opt in” to the Releases. The Releases provide for, among other things, the following:

 

Third Party Releases. Except as otherwise provided in the Plan, the Plan Funding Agreement or the Confirmation Order, on the Effective Date each Releasing Party, in consideration for the obligations of the Debtors under the Plan, the distributions under the Plan and other contracts, instruments, releases, agreements or documents executed and delivered in connection with the Plan, will be deemed to have consented to the Plan and the restructuring embodied in the Plan for all purposes and deemed to forever release, waive and discharge all claims (as such term is defined in section 101(5) of the Bankruptcy Code), including but not limited to any claim sounding in law or equity or asserting a tort, breach of any duty or contract, violations of the common law, any federal or state statute, any federal or state securities laws or otherwise, demands, debts, rights, causes of action (including without limitation, the Causes of Action) or liabilities (other than the right to enforce the obligations of any party under the Plan and the contracts, instruments, releases, agreements and documents delivered under or in connection with the Plan), including, without limitation, any claims for any such loss such holder may suffer, have suffered or be alleged to suffer as a result of the Debtors commencing the Chapter 11 Cases or as a result of the Plan being consummated, against any Released Party, whether liquidated or unliquidated, fixed or contingent, matured or unmatured, known or unknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise that are based in whole or in part on any act or omission, transaction, event or other occurrence taking place on or prior to the Effective Date in any way relating to the Debtors, the Reorganized Debtors, the Chapter 11 Cases, the Plan or the Disclosure Statement; provided, however, that in no event shall anything in this Section 12.06(b) be construed as a release of any Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order, for matters with respect to the Debtors and/or their affiliates. Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval, pursuant to Bankruptcy Rule 9019, of the releases of holders of Claims and Interests, which includes by reference each of the related provisions and definitions contained in the Plan, and further, shall constitute the Bankruptcy Court’s finding that the releases in the Plan are: (1) in exchange for the good and valuable consideration provided by the Released Parties; (2) a good faith settlement and compromise of the claims in the Plan; (3) in the best interests of the Debtors and all holders of Claims and Interests; (4) fair, equitable and reasonable; (5) given and made after notice and opportunity for hearing; and (6) a bar to any holder of a Claim or Interest asserting any Claim released by the releases in the Plan against any of the Released Parties.

 

Notwithstanding anything to the contrary contained in the Plan: (i) except to the extent permissible under applicable law, as such law may be extended or interpreted subsequent to the Effective Date, the releases provided for in this Section 12.06 of the Plan shall not release any non-Debtor entity from any liability arising under (a) the Internal Revenue Code or any

 

3

 

state, city or municipal tax code, (b) any criminal laws of the United States or any state, city or municipality, or (c) any environmental laws of the United States or any state, city or municipal tax code; and (ii) the releases set forth in this Section 12.06 shall not release any (a) claims, right, or Causes of Action for money borrowed from or owed to the Debtors by any of their directors, officers or former employees, as set forth in the Debtors’ books and records, (b) any claims against any Person to the extent such Person asserts a crossclaim, counterclaim and/or claim for setoff which seeks affirmative relief against a Debtor or any of its officers, directors, or representatives, (c) claims against any Person arising from or relating to such Person’s gross negligence, fraud, or willful misconduct, each as determined by a Final Order of the Bankruptcy Court, and (d) any Unimpaired Claims unless and until holders of Unimpaired Claims have received payment on account of such Claims that render such claims Unimpaired in accordance with the Plan.

 

Notwithstanding any language to the contrary contained in this Disclosure Statement, Plan, and/or the Confirmation Order, no provision of the Plan or the Confirmation Order shall (i) preclude the SEC from enforcing its police or regulatory powers; or (ii) enjoin, limit, impair, or delay the SEC from commencing or continuing any claims, causes of action, proceedings or investigations against any non-Debtor person or non-Debtor entity in any forum.

 

As to any Governmental Unit (as defined in section 101(27) of the Bankruptcy Code), nothing in the Plan, Plan Documents, or Confirmation Order shall limit or expand the scope of discharge, release or injunction to which the Debtors or Reorganized Debtors are entitled under the Bankruptcy Code, if any. The discharge, release, and injunction provisions contained in the Plan, Plan Documents, or Confirmation Order are not intended and shall not be construed to bar any Governmental Unit from, subsequent to the Confirmation Order, pursuing any police or regulatory action.

 

Accordingly, notwithstanding anything contained in the Plan, Plan Documents, or Confirmation Order to the contrary, nothing in the Plan or Confirmation Order shall discharge, release, impair or otherwise preclude: (1) any liability to any Governmental Unit that is not a “claim” within the meaning of section 101(5) of the Bankruptcy Code; (2) any Claim of any Governmental Unit arising on or after the Confirmation Date; (3) any valid right of setoff or recoupment of any Governmental Unit against any of the Debtors; or (4) any liability of the Debtors or Reorganized Debtors under police or regulatory statutes or regulations to any Governmental Unit as the owner, lessor, lessee or operator of property that such entity owns, operates or leases after the Confirmation Date. Nor shall anything in the Plan, Plan Documents, or Confirmation Order: (i) enjoin or otherwise bar any Governmental Unit from asserting or enforcing, outside the Bankruptcy Court, any liability described in the preceding sentence; or (ii) divest any court, commission, or tribunal of jurisdiction to determine whether any liabilities asserted by any Governmental Unit are discharged or otherwise barred by the Plan, Plan Documents, Confirmation Order, or the Bankruptcy Code.

 

Moreover, nothing in the Plan, Plan Documents, or Confirmation Order shall release or exculpate any non-debtor, including any Released Parties and/or exculpated parties, from any liability to any Governmental Unit, including but not limited to any liabilities arising under the Internal Revenue Code, the environmental laws, or the criminal laws against the Released Parties and/or exculpated parties, nor shall anything in the Plan, Plan Documents, or

 

4

 

Confirmation Order enjoin any Governmental Unit from bringing any claim, suit, action or other proceeding against any non-Debtor for any liability whatsoever; provided, however, that the foregoing sentence shall not limit the scope of discharge granted to the Debtors under sections 524 and 1141 of the Bankruptcy Code.

 

Nothing contained in the Plan, Plan Documents, or Confirmation Order shall be deemed to determine the tax liability of any person or entity, including but not limited to the Debtors and the Reorganized Debtors, nor shall the Plan, Plan Documents, or Confirmation Order be deemed to have determined the federal and/or state tax treatment of any item, distribution, or entity, including the federal and/or state tax consequences of the Plan and/or Plan Documents, nor shall anything in the Plan, Plan Documents, or Confirmation Order be deemed to have conferred jurisdiction upon the Bankruptcy Court to make determinations as to federal and/or state tax liability and federal and/or state tax treatment except as provided under 11 U.S.C. § 505.

 

Article X of the Plan regarding Executory Contracts and Unexpired Leases, and Section 7.8 of the Plan regarding Cancellation of Existing Securities and Agreements, shall not apply to the Government Settlement Agreements. The Government Settlement Agreements shall be unimpaired by the Plan, Plan Documents, and Confirmation Order, and shall remain obligations of the Debtors and/or the Reorganized Debtors, and all rights, obligations, and duties under the Government Settlement Agreements shall be preserved as if the Debtors’ bankruptcy cases were never filed. All Governmental Units reserve all rights with respect to the Government Settlement Agreements, and nothing contained in the Plan, Plan Documents, or Confirmation Order shall discharge, release, impair, or otherwise preclude any liability to any Governmental Unit arising from or relating to the Government Settlement Agreements. Any amounts owed to Governmental Units under the Government Settlement Agreements shall be paid in full when due in the ordinary course and nothing in the Plan, Plan Documents, or Confirmation Order shall be interpreted to set cure amounts, authorize the assignment or rejection of any Government Settlement Agreement, or require any Governmental Unit to approve of and consent to the assignment of any Government Settlement Agreement. The Debtors and Reorganized Debtors expressly agree that any provisions regarding default in the Government Settlement Agreements shall continue to apply as set forth in those agreements, irrespective of any provisions of the Plan, Plan Documents, and Confirmation Order. For the avoidance of doubt, nothing contained in the Plan, Plan Documents, or Confirmation Order shall divest any court, commission, or tribunal of jurisdiction over any matters related to the Government Settlement Agreements, or confer on the Bankruptcy Court jurisdiction over any matter related to the Government Settlement Agreements. Notwithstanding anything to the contrary in this paragraph, the provisions of this paragraph are subject to the provisions of Section 5.5 of the Plan regarding acceleration or increase of the monetary obligations under the Government Settlement Agreements.

 

The governmental units that are parties to the Government Settlement Agreements have not at this time sought to accelerate or increase payments under those agreements as a result of the filing of these Chapter 11 Cases or the consummation of the transactions contemplated by the Plan and the Plan Documents. The Debtors and certain of the governmental units that are parties to the Government Settlement Agreements are in discussions regarding the intentions of those parties regarding acceleration of the Debtors’ payment obligations under the

 

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Government Settlement Agreements. The Debtors and these parties to the Government Settlement Agreements anticipate reaching resolution on this issue before the Plan is confirmed.

 

HOW TO OPT INTO THE RELEASES BY MAIL

 

1.              If you wish to make an election to opt into the Releases contained in section 12.6(b) of the Plan set forth above, check the box in Item 1 below.

 

2.              Review the certifications contained in Item 2 below.

 

3.              Sign and date this Notice of Non-Voting Status and Opt-In Form and fill out the other required information in the applicable area below.

 

4.              In order for your election to opt into the Releases by mail to be counted, your Notice of Non-Voting Status and Opt-In Form must be properly completed and actually received by the Debtors’ solicitation agent, Prime Clerk LLC (the “Solicitation Agent”), no later than August 15, 2019, at 4:00 p.m. (prevailing Eastern Time). You may use the postage-paid envelope provided or send your Notice of Non-Voting Status and Opt-In Form to the following address:

 

Aegerion Pharmaceuticals, Inc. Ballot Processing Center

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

HOW TO OPT IN TO THE RELEASES ONLINE

 

You may submit your ballot electronically by clicking on the “Submit E-Ballot” section on the Solicitation Agent’s website for these cases, located at http://cases.primeclerk.com/aegerion, and following the directions set forth on the website regarding submitting your E-Ballot as described more fully below.

 

1.                                      Please visit the Debtors’ voting website at http://cases.primeclerk.com/aegerion.

 

2.                                      Click on the “E-Ballot” section of the Debtors’ voting website.

 

3.                                      Follow the directions to submit your Notice of Non-Voting Status and Opt-In Form. If you choose to submit your Notice of Non-Voting Status and Opt-In Form via Prime Clerk’s E-Ballot system, you should not return a hard copy of your Notice of Non-Voting Status and Opt-In Form.

 

E-Ballot ID:

 

“E-BALLOTING” IS THE SOLE MANNER IN WHICH NOTICES OF NON-VOTING STATUS AND OPT-IN FORMS MAY BE DELIVERED VIA ELECTRONIC TRANSMISSION.

 

NOTICES OF NON-VOTING STATUS AND OPT-IN FORMS SUBMITTED BY FACSIMILE OR EMAIL WILL NOT BE COUNTED.

 

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Item 1.         Release.

 

PLEASE TAKE NOTICE THAT YOU MAY CHECK THE BOX BELOW TO OPT INTO THE RELEASE PROVISIONS CONTAINED IN SECTION 12.6(b) OF THE PLAN AND SET FORTH ABOVE. IF YOU OPT INTO THE RELEASE PROVISIONS BY CHECKING THE BOX BELOW AND PROPERLY AND TIMELY SUBMITTING THIS NOTICE OF NON-VOTING STATUS AND OPT-IN FORM, YOU WILL BE DEEMED TO HAVE UNCONDITIONALLY, IRREVOCABLY AND FOREVER RELEASED AND DISCHARGED THE RELEASED PARTIES AS SET FORTH IN SECTION 12.6(b) OF THE PLAN.

 

o                                    OPT IN TO RELEASE.

 

Item 2.         Certification.

 

By returning this Notice of Non-Voting Status and Opt-In Form, the holder of the unimpaired Claim(s) identified below certifies that (a) it was the holder of the unimpaired Claim(s) as of the Record Date and/or it has full power and authority to opt into the Release for the unimpaired Claim(s) identified below with respect to such unimpaired Claim(s), and (b) it understands the scope of the Releases.

 

	
Name of Holder:
    	
 
    
	
 
    	
(Print or Type)
    
	
Signature:
    	
 
    
	
 
    	
 
    
	
Name of Signatory:
    	
 
    
	
 
    	
(If other than   Holder)
    
	
Title:
    	
 
    
	
 
    	
 
    
	
Address:
    	
 
    
	
 
    	
 
    
	
Phone Number:
    	
 
    
	
 
    	
 
    
	
Email:
    	
 
    
	
 
    	
 
    
	
Date Completed:
    	
 
    

 

DEADLINE FOR OBJECTIONS TO CONFIRMATION OF THE PLAN

 

6.                                      Objections, if any, to confirmation of the Plan, including any supporting memoranda, must be in writing, filed with the Clerk of the Bankruptcy Court, together with

 

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proof of service, at 1 Bowling Green, New York, New York 10004, or electronically using the Bankruptcy Court’s Case Management/Electronic Case File (“CM/ECF”) System at https://ecf.nysb.uscourts.gov (a CM/ECF password will be required), in each case, with a hard copy delivered to the Judge’s Chambers, and must: (a) state the name and address of the objecting party and the amount of its claim or the nature of its interest in the Debtors’ chapter 11 cases; (b) state with particularity the provision or provisions of the Plan objected to and for any objection asserted, the legal and factual basis for such objections; (c) provide proposed language to remedy any objection asserted, if possible; and (d) be served by hand delivery or in a manner as will cause such objection to be received on or before August 22, 2019 at 4:00 p.m. (prevailing Eastern Time), by: (i) Aegerion Pharmaceuticals, Inc., 245 First Street, Riverview II, 18th Floor, Cambridge, MA 02142 (Attn: John R. Castellano); (ii) counsel to the Debtors, Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New York, NY 10019 (Attn: Paul V. Shalhoub, Esq. and Andrew S. Mordkoff, Esq.); (iii) counsel to those certain lenders under the Debtors’ debtor-in-possession financing facility, the Debtors’ prepetition secured bridge loan credit agreement and the Debtors’ 2% unsecured convertible notes, Latham & Watkins LLP, 330 North Wabash Avenue, Suite 2800, Chicago, IL 60611 (Attn: Richard A. Levy, Esq.) and King & Spalding LLP, 444 West Lake Street, Suite 1650, Chicago, IL 60606 (Attn: Matthew L. Warren, Esq.); (iv) counsel to the Official Committee of Unsecured Creditors, Kramer Levin Naftalis & Frankel LLP, 1177 Avenue of the Americas, New York, NY 10036 (Attn: Kenneth H. Eckstein, Esq. and Rachael Ringer, Esq.); (v) counsel to the U.S. Trustee for Region 2, 201 Varick Street, Suite 1006, New York, NY 10014 (Attn: Benjamin J. Higgins, Esq. and Brian S. Masumoto, Esq.); (vi) counsel to Novelion Therapeutics Inc., Goodwin Procter LLP, The New York Times Building, 620 Eighth Avenue, New York, NY 10018 (Attn: Gregory Fox, Esq. and Jacqueline Mercier, Esq.); and (vii) counsel to Amryt Pharma Plc, Gibson, Dunn & Crutcher LLP, 200 Park Avenue, New York, NY 10166 (Attn: Matthew J. Williams, Esq. and Jason Zachary Goldstein, Esq.). Any objections not filed and served as set forth above will be deemed waived.

 

COPIES OF THE PLAN AND DISCLOSURE STATEMENT

 

7.                                      The Disclosure Statement and the Plan are on file with the Clerk of the Bankruptcy Court, and copies of the same may be obtained by parties in interest free of charge on the dedicated webpage related to these cases of the Debtors’ Balloting Agent, Prime Clerk LLC (http://cases.primeclerk.com/aegerion). Copies of the Disclosure Statement are also available for inspection during regular business hours at the office of the Clerk of the Bankruptcy Court, 1 Bowling Green, New York, New York 10004. In addition, copies of the Disclosure Statement may be viewed on the internet at the Bankruptcy Court’s website (http://www.nysb.uscourts.gov) by following the directions for accessing the ECF system on such website. Hard copies of the Disclosure Statement will be made available upon request made to the Debtors’ Claims Agent, Prime Clerk LLC, in writing at the following address: Aegerion Pharmaceuticals, Inc. Ballot Processing Center, c/o Prime Clerk LLC, One Grand Central Place, 60 East 42nd Street, Suite 1440, New York, NY 10165, or via telephone at 844-627-5368 or for international calls at 347-292-3524 or via email at: aegerionballots@primeclerk.com.

 

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Dated:  New York, New York
    	
 
    
	
July 11, 2019
    	
 
    
	
 
    	
 
    
	
 
    	
WILLKIE FARR &   GALLAGHER LLP
    
	
 
    	
Counsel   for the Debtors and Debtors in Possession
    
	
 
    	
 
    
	
 
    	
787 Seventh Avenue
    
	
 
    	
New York, New York   10019
    
	
 
    	
(212) 728-8000
    

 

9

 

Exhibit D

 

Rights Offering Procedures

 

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RIGHTS OFFERING PROCEDURES(1)

 

1.                                      Introduction

 

On July 9, 2019, Aegerion Pharmaceuticals, Inc. and Aegerion Pharmaceuticals Holdings, Inc., as debtors and debtors in possession (collectively, the “Debtors”), filed the Debtors’ First Amended Joint Chapter 11 Plan with the United States Bankruptcy Court for the Southern District of New York [Docket No. 180] (as such plan of reorganization may be amended or modified from time to time in accordance with its terms, the “Plan”), and the disclosure statement with respect to the Plan [Docket No. 182] (as such disclosure statement may be amended from time to time in accordance with its terms, the “Disclosure Statement”).

 

Pursuant to the Plan, each Eligible Holder (i.e., holder of an Allowed Class 4 Novelion Intercompany Loan Claim or an Allowed Class 6B Other General Unsecured Claim as of the Voting Record Date that timely votes in favor of the Plan) has the right to participate in a $42 million offering (the “Rights Offering”) conducted by the Plan Investor (as defined below) in accordance with the terms and conditions of these procedures (the “Rights Offering Procedures”), the Plan, the Subscription Form (as defined below) and the Backstop Commitment Agreement (as defined below). The Rights Offering will supplement the $18 million Plan Investor Equity Raise (as defined below), both of which are backstopped in full by the Backstop Parties (as defined below).

 

In connection with the Plan and in accordance with these Rights Offering Procedures, the Plan Investor will conduct the Rights Offering. Each Eligible Holder (as defined below) has the right, but not the obligation, to purchase a portion of shares of New Common Stock issued by the Plan Investor or a new holding company established to hold 100% of the equity of the Plan Investor (the “Rights Offering Stock”), provided that such Eligible Holder timely and properly executes and delivers its Rights Offering subscription form (the “Subscription Form” and together with the Rights Offering Procedures, the “Rights Offering Documents”) to the Subscription Agent (as defined below). The aggregate Purchase Price for all Subscription Rights (each as defined below) for the Rights Offering Stock is $42 million.

 

Each Eligible Holder shall have the right to purchase up to its Pro Rata Share (as defined below) of the Rights Offering Stock pursuant to the Rights Offering (the “Subscription Rights”), all pursuant to the terms set forth herein, in the Subscription Form, the Backstop Commitment Agreement, and the Plan. With respect to each Eligible Holder, each Subscription Right shall represent the right to acquire one (1) share of Rights Offering Stock for the Purchase Price. Fractional shares of Rights Offering Stock shall not be issued upon exercise of the Subscription Rights. The number of shares of Rights Offering Stock issued upon any holder’s exercise of its Subscription Rights will be rounded down to the nearest whole share and no compensation shall be paid in respect of any such fractional shares.

 

In addition, the Subscription Form provides that each Eligible Holder will also have the right (an “Oversubscription Right”) to elect to purchase additional shares of Rights

 

(1)         Capitalized terms used but not otherwise defined herein have the meanings given to them in the Plan or these Rights Offering Procedures (each as defined below).

 

 

Offering Stock that (a) are not timely, duly and validly subscribed and paid for by the Eligible Holders that timely vote to accept the Plan in accordance with the Rights Offering Procedures, and (b) also are not timely, duly and validly subscribed and paid for by Plan Investor Shareholders identified by the Plan Investor in accordance with the procedures governing the Plan Investor Equity Raise (provided that the Plan Investor shall only have the right to identify such Plan Investor Shareholders if the Plan Investor has fully sold the $18 million Plan Investor Equity Raise by the Subscription Expiration Deadline) (such unsubscribed shares, the “Unsubscribed Shares” and, such election, an “Oversubscription Election”). With respect to each Eligible Holder, each Oversubscription Right shall represent the right to acquire one (1) Unsubscribed Share for the Purchase Price. Fractional shares of Unsubscribed Shares shall not be issued upon exercise of the Oversubscription Rights. The number of shares of Unsubscribed Shares issued upon any holder’s exercise of its Oversubscription Rights will be rounded down to the nearest whole share and no compensation shall be paid in respect of any such fractional shares. In the event that the aggregate shares issuable pursuant to the exercise of Oversubscription Rights exceeds the number of Unsubscribed Shares, Eligible Holders who have made Oversubscription Elections will receive their Pro Rata Share of the Unsubscribed Shares.

 

For purposes of these Rights Offering Procedures, each of the following capitalized terms shall have the meaning set forth below:

 

“Allowed” has the meaning set forth in the Plan.

 

“Backstop Commitment Agreement” has the meaning set forth in the Plan.

 

“Backstop Parties” has the meaning set forth in the Plan.

 

“Bankruptcy Code” means title 11 of the United States Code, as amended from time to time, as applicable to the Debtors’ chapter 11 cases.

 

“Bankruptcy Court” has the meaning set forth in the Plan.

 

“Business Day” has the meaning set forth in the Plan.

 

“Debtors” has the meaning set forth in Section 1 hereof.

 

“Disclosure Statement” has the meaning set forth in Section 1 hereof.

 

“Effective Date” has the meaning set forth in the Plan.

 

“Eligible Holder” means a holder of an Allowed Class 4 Novelion Intercompany Loan Claim or Allowed Class 6B Other General Unsecured Claim as of the Voting Record Date that timely votes to accept the Plan.

 

“New Common Stock” has the meaning set forth in the Plan.

 

“New Registration Rights Agreement” has the meaning set forth in the Plan.

 

“New Warrants” has the meaning set forth in the Plan.

 

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“Nominee” has the meaning set forth in Section 3(c) hereof.

 

“Novelion Intercompany Loan Claim” has the meaning set forth in the Plan.

 

“Other General Unsecured Claim” has the meaning set forth in the Plan.

 

“Oversubscription Balance” has the meaning set forth in Section 3(b) hereof.

 

“Oversubscription Election” has the meaning set forth in Section 1 hereof.

 

“Oversubscription Payment Date” has the meaning set forth in Section 3(b) hereof.

 

“Oversubscription Payment Notice” has the meaning set forth in Section 3(b) hereof.

 

“Oversubscription Right” has the meaning set forth in Section 1 hereof.

 

“Payment Instructions” has the meaning set forth in Section 3(d) hereof.

 

“Plan” has the meaning set forth in Section 1 hereof.

 

“Plan Funding Agreement” has the meaning set forth in the Plan.

 

“Plan Investor” means (a) Amryt Pharma Plc, on behalf of itself and/or one or more of its affiliates, and (b) in the case of the issuance of the New Common Stock and for purposes of Article XII of the Plan and for purposes of the New Registration Rights Agreement, Amryt Pharma Plc or a new holding company established to hold 100% of the equity of the Plan Investor and will assume the Plan Investor’s obligations under and in accordance with the Plan Funding Agreement.

 

“Plan Investor Equity Raise” means the additional $18 million equity raise conducted by the Plan Investor for shares of New Common Stock (including New Common Stock to be issuable upon exercise of the New Warrants) to be issued by the Plan Investor to the Plan Investor Shareholders and backstopped by the Backstop Parties.

 

“Plan Investor Shareholders” means those persons participating in the Plan Investor Equity Raise and, pursuant to the procedures governing the Plan Investor Equity Raise, entitled to subscribe for Unsubscribed Shares in the Rights Offering.

 

“Pro Rata Share” means a distribution equal in amount to the ratio (expressed as a percentage) that the amount of such Eligible Holder’s (a) Subscription Rights bears to the aggregate amount of all Rights Offering Stock distributed to Eligible Holders, and (b) Oversubscription Rights bears to the aggregate amount of all Unsubscribed Shares, as determined pursuant to the Rights Offering.

 

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“Purchase Price” means with respect to Rights Offering Stock, the Rights Offering Exercise Price multiplied by the number of Subscription Rights being exercised by an individual Eligible Holder for the Rights Offering Stock elected to be purchased by such Eligible Holder.

 

“Required Parties” has the meaning set forth in the Plan.

 

“Rights Offering” has the meaning set forth in Section 1 hereof.

 

“Rights Offering Documents” has the meaning set forth in Section 1 hereof.

 

“Rights Offering Exercise Price” means a price per share of Rights Offering Stock, at a 20% discount of the implied value of each share, that is based upon the Rights Offering Stock equaling 13.61% of the New Common Stock of the Plan Investor (after giving effect to the Rights Offering and the Plan Investor Equity Raise, but prior to any management incentive plan, conversion of the New Convertible Notes (as defined in the Plan), or any contingent value rights issued to Plan Investor Shareholders).

 

“Rights Offering Funds” has the meaning set forth in Section 3(g) hereof.

 

“Rights Offering Procedures” has the meaning set forth in Section 1 hereof.

 

“Rights Offering Stock” has the meaning set forth in Section 1 hereof.

 

“Subscription Agent” means Prime Clerk LLC, in its capacity as such.

 

“Subscription Commencement Date” has the meaning set forth in Section 2 hereof.

 

“Subscription Expiration Deadline” means 5:00 p.m. (prevailing Eastern Time) on August 15, 2019 (as may be extended in accordance with the terms of these Rights Offering Procedures), the date by which properly completed Subscription Forms and Purchase Prices will be required to be delivered to the Subscription Agent as provided in these Rights Offering Procedures and all Subscription Rights and Oversubscription Rights must be exercised.

 

“Subscription Form” has the meaning set forth in Section 1 hereof.

 

“Subscription Rights” has the meaning set forth in Section 1 hereof.

 

“Unsubscribed Shares” has the meaning set forth in Section 1 hereof.

 

“Voting Record Date” means July 11, 2019 at 5:00 p.m. (prevailing Eastern Time).

 

Only Eligible Holders shall be entitled to participate in the Rights Offering. Before exercising any Subscription Rights or Oversubscription Rights, Eligible Holders

 

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should read the Disclosure Statement, including the section entitled “Certain Risk Factors to Be Considered,” and the Plan.

 

2.                                      Commencement/Expiration of the Rights Offering

 

The Rights Offering shall commence on the day upon which these Rights Offering Procedures and Subscription Forms are mailed to holders of Allowed Novelion Intercompany Loan Claims and Allowed Other General Unsecured Claims (or distributed to nominees on behalf of such holders) (the “Subscription Commencement Date”), which shall be no later than five (5) Business Days after entry of an order by the Bankruptcy Court approving the Disclosure Statement. The Rights Offering shall expire on the Subscription Expiration Deadline. Eligible Holders may exercise their Subscription Rights and Oversubscription Rights at any time after receipt of the Rights Offering Documents, until the Subscription Expiration Deadline.

 

If the Subscription Expiration Deadline is extended in accordance with the terms of these Rights Offering Procedures, the Debtors shall promptly notify all potential Eligible Holders in writing (including by electronic mail) and/or by posting a notice on the website maintained by the Subscription Agent (http://cases.primeclerk.com/aegerion) of such extension and the date of the new Subscription Expiration Deadline. Each Eligible Holder intending to participate in the Rights Offering must affirmatively make an election to exercise its Subscription Rights and Oversubscription Rights on or prior to the Subscription Expiration Deadline in accordance with the provisions of Section 3 below, and must vote to accept the Plan.

 

3.                                      Exercise of Subscription Rights and Oversubscription Rights

 

A.            Subscription Rights

 

To exercise the Subscription Rights, each Eligible Holder must (i) deliver a duly executed and completed Subscription Form indicating such Eligible Holder’s election to exercise such portion of its Subscription Rights and Oversubscription Rights as set forth therein, which must actually be received by the Subscription Agent on or before the Subscription Expiration Deadline, and (ii) pay to the Subscription Agent, by wire transfer of immediately available funds, the Purchase Price so that such payment is actually received by the Subscription Agent on or before the Subscription Expiration Deadline(2) in accordance with the Payment Instructions (as defined below). If, on or prior to the Subscription Expiration Deadline, the Subscription Agent for any reason does not receive from or on behalf of an Eligible Holder a duly executed and completed Subscription Form and the related payment, such Eligible Holder shall be deemed to have fully and irrevocably relinquished and waived its Subscription Rights and Oversubscription Rights. Eligible Holders who exercise their Subscriptions Rights by complying with clauses (i) and (ii) above, will, on the Effective Date, be holders of Rights Offering Stock.

 

Once an Eligible Holder has properly exercised its Subscription Rights and Oversubscription Rights, subject to the terms and conditions of these Rights Offering

 

(2)         Except such payments made by DTC which may be received by the Subscription Agent after the Subscription Expiration Deadline.

 

5

 

Procedures, such exercise shall be irrevocable and no further transfers shall be permitted or recognized. Subject to the exercise of Oversubscription Rights, each Eligible Holder is entitled to participate in the Rights Offering solely to the extent of its Pro Rata Share of the Rights Offering Stock. Each Eligible Holder may exercise all or any portion of such holder’s Subscription Rights and Oversubscription Rights pursuant to the procedures outlined below; provided, however, that no fractional shares of New Common Stock shall be issued pursuant to any exercise of Subscription Rights or Oversubscription Rights.

 

To facilitate the exercise of the Subscription Rights and Oversubscription Rights, on the Subscription Commencement Date, the Debtors will mail or cause to be mailed a Subscription Form to each holder of an Allowed Novelion Intercompany Loan Claim and an Allowed Other General Unsecured Claim (or to nominees on behalf of such holders), together with instructions for the proper completion, due execution and timely delivery of the Subscription Form to the Subscription Agent.

 

Any attempt to exercise Subscription Rights or Oversubscription Rights after the Subscription Expiration Deadline shall be null and void and neither the Debtors nor the Plan Investor shall be obligated to honor any such purported exercise received by the Subscription Agent after the Subscription Expiration Deadline, regardless of when the documents relating thereto were sent.

 

The method of delivery of the Subscription Form and any other required documents is at each Eligible Holder’s option and sole risk, and delivery will be considered made only when actually received by the Subscription Agent. If delivery is by mail, registered mail with return receipt requested, properly insured, is encouraged and strongly recommended. In all cases, you should allow sufficient time to ensure timely delivery prior to the Subscription Expiration Deadline. Delivery shall be made to:

 

Aegerion Pharmaceuticals, Inc. Subscription Processing

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

Or via email at: aegerionsubscription@primeclerk.com

 

B.            Exercise of Oversubscription Rights

 

In order to validly exercise their Oversubscription Rights, Eligible Holders must, in addition to complying with the procedures for validly exercising Subscription Rights set forth above, specify on the Subscription Form the maximum percentage of Unsubscribed Shares such Eligible Holder wishes to purchase pursuant to its Oversubscription Rights.

 

No later than 5 Business Days after the expiration of the Plan Investor Equity Raise, the Subscription Agent shall deliver to each Eligible Holder that makes an

 

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Oversubscription Election a notice (the “Oversubscription Payment Notice”)(3) setting forth (i) the number of Unsubscribed Shares to which such Eligible Holder is entitled, and (ii) the Purchase Price owed by such Eligible Holder, if any, on account of the exercise of its Oversubscription Rights (the “Oversubscription Balance”). Any Eligible Holder that receives an Oversubscription Payment Notice shall have until 5:00 p.m. (prevailing Eastern Time) on the second Business Day after receipt of such Oversubscription Payment Notice (which deadline will also be set forth therein) (the “Oversubscription Payment Date”)(4) to pay in full to the Subscription Agent its Oversubscription Balance by wire transfer of immediately available funds.

 

C.            Subscription Nominees

 

The Debtors will furnish, or cause to be furnished, Subscription Forms and other Rights Offering Documents to the Eligible Holders and/or, to the extent applicable, their brokers, dealers, commercial banks, trust companies, or other agents or nominees (the “Nominees”). Each Nominee is entitled to receive sufficient copies of the Rights Offering Documents for distribution to the Eligible Holders on behalf of whom the Nominee represents.

 

In order to exercise their Subscription Rights and make an Oversubscription Election, any Eligible Holders who hold Subscription Rights through a Nominee must return a duly completed Subscription Form to its Nominee or otherwise instruct its Nominee as to its instructions for the Subscription Rights or Oversubscription Election (in each case in sufficient time to allow such Nominee to deliver the Subscription Form to the Subscription Agent prior to the Subscription Expiration Deadline) in accordance with procedures established by its Nominee, which, in turn, must comply with the terms and conditions of these Rights Offering Procedures.

 

D.            Payment for Rights Offering Stock

 

The Subscription Forms shall include written instructions (the “Payment Instructions”) relating to the payment of the Purchase Price for each Eligible Holder that exercises Subscription Rights and the Oversubscription Balance for each Eligible Holder that exercises Oversubscription Rights. The Payment Instructions shall include (i) for each Eligible Holder exercising Subscription Rights, wire transfer instructions for the payment of the Purchase Price, (ii) for each Eligible Holder exercising Oversubscription Rights, wire transfer instructions for the payment of the Oversubscription Balance, and (iii) the deadline by which such payment(s) must be made.

 

If the Subscription Agent for any reason does not receive from or on behalf of an Eligible Holder immediately available funds by wire transfer in an amount equal to the (a) Purchase Price for such Eligible Holder’s exercised Subscription Rights on or prior to the Solicitation Expiration Deadline, or (b) Oversubscription Balance for such Eligible Holder’s exercised Oversubscription Rights on or prior to the Oversubscription Payment Date, such

 

(3)         Except such payments made by DTC which may be received by the Subscription Agent after the Oversubscription Payment Date.

 

7

 

Eligible Holder shall be deemed to have fully and irrevocably relinquished and waived its Subscription Rights and Oversubscription Rights; provided, however, that notwithstanding the foregoing, the Debtors reserve the right to pursue all remedies at equity and in law to compel payment or seek damages for such Eligible Holder’s non-payment. In no event, however, shall any Eligible Holder be liable on any theory of liability for any special, indirect, consequential or punitive damages as a result of its failure to deliver payment.

 

E.            Subsequent Determination of Allowed Claims

 

If, after the Voting Record Date, but at least seven (7) calendar days prior to the Subscription Expiration Deadline, as a result of a Bankruptcy Court order estimating, allowing, disallowing or reclassifying an Other General Unsecured Claim, an Eligible Holder becomes entitled to Subscription Rights and Oversubscription Rights (or a different amount of Subscription Rights and Oversubscription Rights than initially granted), such Eligible Holder shall be permitted to participate in the Rights Offering only with respect to such Other General Unsecured Claim as so estimated, allowed, disallowed or reclassified.

 

F.             Disputes, Waivers, and Extensions

 

All determinations as to the proper completion, due execution, timeliness, or eligibility of any exercise arising in connection with the submission of a Subscription Form and other Rights Offering Documents and other matters affecting the validity or effectiveness of any attempted exercise of any Subscription Rights and Oversubscription Rights shall be made by the Plan Investor in its sole discretion, reasonably exercised in good faith, which determinations shall be final and binding. An Eligible Holder shall be deemed not to have complied with subscription instructions, and such Eligible Holder’s Subscription Form shall be deemed not duly executed and completed unless and until all defects and irregularities have been waived or cured within such time as the Plan Investor determines in its discretion, reasonably exercised in good faith. The Plan Investor reserves the right, but are under no obligation, to give notice to any Eligible Holder regarding any defect or irregularity in connection with any purported exercise of Subscription Rights or Oversubscription Rights by such Eligible Holder and the Plan Investor may, but is under no obligation to, permit such defect or irregularity to be cured within such time as it may determine in good faith. None of the Debtors, the Subscription Agent, the Plan Investor or any of their respective advisors or agents shall incur any liability for failure to give such notification.

 

With the prior written consent of the Debtors and the Backstop Parties, the Plan Investor may (a) extend the duration of the Rights Offering and the Subscription Expiration Deadline, or (b) adopt additional detailed procedures to more efficiently administer the distribution and exercise of the Subscription Rights and Oversubscription Rights that are not inconsistent with these procedures.

 

None of the Debtors or their advisors or agents shall have or incur any liability on account of the Plan Investor’s actions or inactions in connection with the foregoing.

 

8

 

G.           Funds

 

All payments required to be made in connection with an Eligible Holder’s exercise of its Subscription Rights or Oversubscription Rights (the “Rights Offering Funds”) shall be deposited in accordance with the paragraph entitled “Payment for Rights Offering Stock” above and held by the Subscription Agent in a segregated account or accounts pending the Effective Date, which segregated account or accounts will: (i) not constitute property of the Plan Investor or the Debtors’ estates until the Effective Date; (ii) be separate and apart from, and not commingled with, the Subscription Agent’s general operating funds and any other funds subject to any lien or any cash collateral arrangements; and (iii) be maintained for the sole purpose of holding the money for administration of the Rights Offering until the Effective Date. The Subscription Agent shall not use the Rights Offering Funds for any purpose other than to release the funds as directed by the Debtors and the Plan Investor on the Effective Date and shall not encumber, or permit the Rights Offering Funds to be encumbered, by any lien or similar encumbrance.

 

H.           Waiver

 

Each Eligible Holder that participates in the Rights Offering shall be deemed, by virtue of such participation, to have waived and released, to the fullest extent permitted under applicable law, all rights, claims or causes of action against the Debtors, the Reorganized Debtors, the Plan Investor, and each of their respective subsidiaries, affiliates, advisors and agents, and the Subscription Agent arising out of or related to the receipt, delivery, disbursements, calculations, transmission or segregation of cash, Subscription Rights, Oversubscription Rights and Rights Offering Stock in connection with the Rights Offering, except to the extent such claims arise out of gross negligence or willful misconduct by any such party.

 

4.                                      Transfer Restriction; Revocation

 

The Subscription Rights and Oversubscription Rights are not transferable or detachable from the Allowed Novelion Intercompany Loan Claims or Allowed Other General Unsecured Claims. Subscription Rights and Oversubscription Rights may be exercised only by or through the Eligible Holder entitled to receive such Subscription Rights and Oversubscription Rights on the Voting Record Date. Any transfer or attempted transfer of the Subscription Rights or Oversubscription Rights will be null and void and the Subscription Agent will not treat any purported transferee thereof as the holder of any Subscription Rights or Oversubscription Rights or permit any such purported transferee to exercise Subscription Rights or Oversubscription Rights or purchase shares in the Rights Offering. Once the Eligible Holder has properly exercised its Subscription Rights and Oversubscription Rights and paid its Purchase Price and Oversubscription Balance, such exercise will not be permitted to be revoked by such Eligible Holder. In the event that an Eligible Holder who has properly exercised its Subscription Rights and Oversubscription Rights and paid the Purchase Price and Oversubscription Balance, respectively, sells or otherwise transfers its underlying claim subject to the Rights Offering, the successor to or the transferee of such claim shall not be deemed an Eligible Holder as defined in these Rights Offering Procedures.

 

9

 

5.                                      Return of Payment

 

If the Plan, and therefore the Rights Offering, is not consummated, any cash paid to the Subscription Agent will be returned to the applicable Eligible Holder as soon as reasonably practicable after the date on which the Rights Offering is terminated, without any interest or deduction.

 

6.                                      Subsequent Adjustments

 

If, as of the Subscription Expiration Deadline, as a result of allowance of Other General Unsecured Claims or other actions following the Voting Record Date, more than all of the Rights Offering Stock and Unsubscribed Shares from the Plan Investor Equity Raise has been subscribed for, each properly exercising Eligible Holder’s Subscription Rights and Oversubscription Rights shall be reduced on a pro rata basis.

 

The difference between the Purchase Price actually paid by such exercising Eligible Holder and the Purchase Price that such Eligible Holder is required to pay after giving effect to the reduction, if any, shall be refunded, without interest, on or as soon as reasonably practicable after the Effective Date.

 

7.                                      Inquiries and Transmittal of Documents; Subscription Agent

 

The instructions contained in the Subscription Form should be carefully read and strictly followed.

 

Questions relating to the Rights Offering should be directed to the Subscription Agent via telephone at 844-627-5368 or for international calls at 347-292-3524 or via email at aegerionsubscription@primeclerk.com.

 

The risk of non-delivery of all documents and payments is on the Eligible Holder electing to exercise its Subscription Rights and Oversubscription Rights and not the Debtors, the Subscription Agent, the Plan Investor or any other Eligible Holder.

 

8.                                      Registration

 

Each of the Subscription Rights and Oversubscription Rights are being, and the Rights Offering Stock will be, issued to the Eligible Holders participating in the Rights Offering without registration under the Securities Act in reliance upon the exemption provided in Section 1145 of the Bankruptcy Code. None of the shares of Rights Offering Stock have been registered or, except as provided in the Registration Rights Agreement, will be registered, under the Securities Act, or any state or local law requiring registration for offer or sale of a security.

 

9.                                      Rights Offering Conditioned Upon Confirmation of the Plan; Reservation of Rights

 

Notwithstanding anything to the contrary herein and in the Rights Offering Documents, all exercises of Subscription Rights and Oversubscription Rights are subject to and conditioned upon the confirmation of the Plan and the occurrence of the Effective Date. Notwithstanding anything contained herein, the Disclosure Statement or the Plan to the contrary,

 

10

 

the Plan Investor, in consultation with the Required Parties, reserves the right to modify these Rights Offering Procedures in order to comply with applicable law or otherwise.

 

10.                               Rights Offering Stock Distribution Date

 

The Rights Offering Stock and any Unsubscribed Shares from the New Equity Raise acquired in connection with the Rights Offering by Eligible Holders that have elected to participate in the Rights Offering and who have validly exercised their Subscription Rights and Oversubscription Rights shall be distributed in accordance with the distribution provisions contained in the Plan.

 

11

 

INSTRUCTIONS TO SUBSCRIPTION FORM

FOR RIGHTS OFFERING CONTEMPLATED BY

DEBTORS’ FIRST AMENDED JOINT CHAPTER 11 PLAN

 

SUBSCRIPTION EXPIRATION DEADLINE

 

The deadline to exercise Subscription Rights(1) and Oversubscription Rights is 5:00 p.m. (prevailing Eastern Time) on August 15, 2019 (the “Subscription Expiration Deadline”)

 

To Eligible Holders:

 

By order dated July 11, 2019, the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) approved the Disclosure Statement for the Debtors’ First Amended Joint Chapter 11 Plan (as amended, modified and/or supplemented, the “Disclosure Statement”). A copy of the Debtors’ First Amended Joint Chapter 11 Plan (as amended, modified and/or supplemented, the “Plan”) is annexed to the Disclosure Statement as Exhibit 1.

 

Pursuant to the Plan, Eligible Holders have the right to purchase a portion of the shares of New Common Stock issued by the Plan Investor on the Effective Date (the “Rights Offering Stock”). For a complete description of the Rights Offering, see the accompanying Rights Offering Procedures (the “Rights Offering Procedures”).

 

Eligible Holders as of the Voting Record Date may exercise Subscription Rights and Oversubscription Rights in accordance with the Rights Offering Procedures. Please utilize the attached Subscription Form to exercise your Subscription Rights and Oversubscription Rights. In order to elect to participate in the Rights Offering, you must (a) arrange for payment of the Purchase Price and, if applicable, the Oversubscription Balance in accordance with the directions below, and (b) complete the attached Subscription Form and return it to Prime Clerk LLC (the “Subscription Agent”) at the following address, so that it is received by the Subscription Expiration Deadline:

 

Aegerion Pharmaceuticals, Inc. Subscription Processing

c/o Prime Clerk LLC

One Grand Central Place

60 East 42nd Street, Suite 1440

New York, NY 10165

 

Or via email at: aegerionsubscription@primeclerk.com

 

(1)         Capitalized terms used but not otherwise defined herein have the meanings given to them in the Plan or the Rights Offering Procedures (each as defined below).

 

1

 

Please be aware that, notwithstanding anything to the contrary herein or in the Rights Offering Procedures, holders of Novelion Intercompany Loan Claims and holders of Other General Unsecured Claims must complete the Class 4 and Class 6B Ballots, respectively (each a “Ballot”) (your respective Ballot is included in the materials that were sent to you with the Disclosure Statement) and timely vote to accept the Plan in order to exercise your Subscription Rights and Oversubscription Rights and receive Rights Offering Stock.

 

Questions. If you have any questions about this Subscription Form or the exercise procedures described herein and in the Rights Offering Procedures, please contact the Subscription Agent via telephone at 844-627-5368 or for international calls at 347-292-3524 or via email at aegerionsubscription@primeclerk.com.

 

The Subscription Agent must receive your executed Subscription Form and the related payment by the Subscription Expiration Deadline (or, in the case of an Oversubscription Balance, by the Oversubscription Payment Date) or your exercise of your Subscription Rights and Oversubscription Rights shall be void and you will be deemed to have fully and irrevocably relinquished and waived your Subscription Rights and Oversubscription Rights.

 

To purchase Rights Offering Stock pursuant to the Rights Offering:

 

1.                                      Insert the principal amount of your Allowed Novelion Intercompany Loan Claim or Other General Unsecured Claim you hold as of the Voting Record Date in Item 1 of the Subscription Form.

 

2.                                      Complete the calculations in Item 2a, Item 2b and Item 2c of the Subscription Form.

 

3.                                      Indicate the maximum percentage of New Common Stock to be subscribed for in Item 3.

 

4.                                      Provide the maximum percentage of Unsubscribed Shares to be subscribed for in Item 4.

 

5.                                      Coordinate payment using the instructions set forth in Item 5.

 

6.                                      Indicate if you are a party to the Backstop Commitment Agreement by checking the box in Item 6.

 

7.                                      Complete the registration information in Item 7.

 

8.                                      Read and Complete the certification in Item 8 of the Subscription Form.

 

9.                                      Complete an IRS Form W-9 if you are a U.S. person. If you are a non-U.S. person, read, complete and sign an appropriate IRS Form W-8. These forms may be obtained from the IRS at its website: http://www.irs.gov.

 

10.                               Return the Subscription Form (with accompanying IRS Form W-9 or appropriate IRS Form W-8, as applicable) to the Subscription Agent at the address specified in Item 4 below on or before the Subscription Expiration Deadline.

 

2

 

11.                               Please Note that once the Subscription Rights and Oversubscription Rights are validly exercised, they cannot be transferred, revoked or otherwise withdrawn.

 

Before exercising any Subscription Rights and Oversubscription Rights, you should read the Disclosure Statement, including the section entitled “Certain Risk Factors to Be Considered”, and the Plan.

 

3

 

SUBSCRIPTION FORM FOR RIGHTS OFFERING

CONTEMPLATED BY DEBTORS’ FIRST AMENDED JOINT CHAPTER 11 PLAN

 

SUBSCRIPTION EXPIRATION DEADLINE

 

The Subscription Expiration Deadline is 5:00 p.m. (prevailing Eastern Time) on August 15, 2019.

 

Please consult the Instructions to Subscription Form accompanying this Subscription Form as well as the Rights Offering Procedures for additional information with respect to this Subscription Form.

 

Item 1.         Amount. I certify that I beneficially hold claims as of the date certified by such Eligible Holder in Item 4 below in the following principal amount (insert amount in the applicable box below) or that I am the authorized signatory of that beneficial holder. For purposes of this Subscription Form, do not adjust the principal (face) amount for any accrued or unmatured interest or any accretion factor. Complete only one of the following boxes:

 

$

Certified Principal Amount of Allowed

Class 4 Novelion Intercompany Loan Claims

 

- or -

 

$

Certified Principal Amount of Allowed

Class 6B Other General Unsecured Claims

 

Item 2.         Subscription Rights. Subject to the terms and conditions set forth in the Plan, each Eligible Holder is eligible to participate in the Rights Offering.

 

2a. Calculation of Maximum Pro Rata Share of New Common Stock. The maximum pro rata share of New Common Stock which you may subscribe for with respect to your Class 4

 

4

 

Novelion Intercompany Loan Claims or Class 6B Other General Unsecured Claims is calculated as follows:

 

	
 
    	
÷
    	
$[    ]
    	
x
    	
100
    	
=
    	
 
    	
%
    
	
(Insert total   claim amount from Item 1 above)
    	
 
    	
(Total Allowed   Class 4 Novelion Intercompany Loan Claims or Class 6B Other General   Unsecured Claims)
    	
 
    	
 
    	
 
    	
(Percentage of   maximum pro rata share of New   Common Stock with respect to the Class 4 Novelion Intercompany Loan   Claims or Class 6B Other General Unsecured Claims)
    

 

2b. Aggregate Purchase Price and Aggregate Funding Amount. By filling in the following blanks, you are indicating that the undersigned Eligible Holder is electing to purchase the amount of New Common Stock corresponding to the New Common Stock specified below (specify a percentage of the New Common Stock not greater than the percentage equal to the maximum pro rata share of the New Common Stock set forth in Item 2a above), on the terms of and subject to the conditions set forth in the Rights Offering Procedures.

 

	
 
    	
X
    	
$42,000,000
    	
=
    	
$
    	
 
    
	
(Indicate   percentage of New Common Stock the Eligible Holder elects to purchase with   respect to its Class 4 Novelion Intercompany Loan Claims or   Class 6B Other General Unsecured Claims. The percentage cannot be greater than the percentage   equal to the maximum pro rata share of the New Common Stock set forth in Item   2a.)
    	
 
    	
 
    	
 
    	
(Aggregate   Purchase Price rounded to the nearest cent)
    

 

5

 

Item 3.         Total New Common Stock.

 

By filling in the following blanks you are indicating that the undersigned Eligible Holder will hold no greater than the amount of interests in the New Common Stock specified below on the terms of and subject to the conditions set forth in the Rights Offering Procedures.

 

3c. Amount of New Common Stock:

 

	
 
    	
X
    	
 
    	
=
    	
 
    
	
(Aggregate   Purchase Price set forth in Item 2b above)
    	
 
    	
(Equity   Percentage)
    	
 
    	
Purchase Amount   of New Common Stock)
    

 

Item 4.         Exercise of Oversubscription Rights. By filling in the following blanks, you are indicating that you are interested in purchasing Unsubscribed Shares pursuant to your Oversubscription Rights on the terms of and subject to the conditions set forth in the Rights Offering Procedures. Please note that if you do not subscribe for the maximum number of shares of Rights Offering Stock calculated in Item 2a above, then you forfeit your Oversubscription Rights and may not purchase Unsubscribed Shares pursuant to Oversubscription Rights.

 

You may elect to exercise your Oversubscription Rights with respect to any or all Unsubscribed Shares. The number of Unsubscribed Shares will not be known until after the Subscription Expiration Deadline. In the event the aggregate shares of Rights Offering Stock issuable pursuant to the exercise of Oversubscription Rights exceeds the number of Unsubscribed Shares, Eligible Holders who have made Oversubscription Elections will receive their Pro Rata Share of the Unsubscribed Shares. If you elect to exercise your Oversubscription Rights, such election will be binding, and you will be obligated to purchase the Unsubscribed Shares for which you have exercised these rights, adjusted for any proration, in accordance with the Rights Offering Procedures and the procedures governing the Plan Investor Equity Raise at the Rights Offering Exercise Price. Indicate the maximum percentage of Unsubscribed Shares you wish to purchase pursuant to your Oversubscription Rights.

 

	
 
    	
 
    	
 
    
	
 
    	
(Indicate percentage of Unsubscribed Shares you   elect to purchase, which percentage cannot exceed the Equity Percentage   listed above)
    	
 
    

 

6

 

Item 5.         Payment Procedure. The Purchase Price indicated in Item 2b above must be sent by wire transfer in immediately available funds so that it is received by the Subscription Agent on or before the Subscription Expiration Deadline. In addition, to the extent that an Oversubscription Payment Notice is issued and the Eligible Holder is required to pay an Oversubscription Balance in connection with its exercised Oversubscription Rights, such payment must be made by wire transfer in immediately available funds so that it is received by the Subscription Agent on or before the Oversubscription Payment Date.

 

The wire instructions for the Subscription Agent are as follows:

 

	
Wire   Instructions:
    	
 
    
	
 
    	
 
    
	
Account   Name:
    	
[To be   completed]
    
	
Account   #:
    	
[To be   completed]
    
	
ABA/Routing   #:
    	
[To be   completed]
    
	
Bank   Name:
    	
[To be   completed]
    
	
Bank   Address:
    	
[To be   completed]
    
	
Memo/Note   Field:
    	
[Insert   Holder’s Name]
    

 

If, prior to the Subscription Expiration Deadline, all of the steps outlined in this Subscription Form are not completed, you will be deemed to have fully and irrevocably relinquished and waived your right to participate in the Rights Offering.

 

7

 

In order to exercise the Subscription Rights and Oversubscription Rights, you or your Nominee must: (i) return (x) this duly completed Subscription Form, and (y) IRS Form W-9 or appropriate IRS Form W-8, as applicable (such IRS Forms can be found on the IRS website (http://www.irs.gov)), to the Subscription Agent so that such forms are actually received by the Subscription Agent prior to the Subscription Expiration Deadline; and (ii) pay the Purchase Price to the Subscription Agent, by wire transfer of immediately available funds, so that payment of the Purchase Price is actually received by the Subscription Agent on or before the Subscription Expiration Deadline, and, to the extent applicable, pay the Oversubscription Balance, by wire transfer of immediately available funds, so that payment of the Oversubscription Balance is actually received by the Subscription Agent on or before the Oversubscription Payment Date.

 

Item 6.         Check the box below if you are a party to the Backstop Commitment Agreement

 

Backstop Party

 

IF YOU ARE UNSURE IF YOU ARE A BACKSTOP PARTY DO NOT MAKE THIS ELECTION.

 

Item 7.         Registration Information. The resulting shares will be registered on the books and records at a transfer agent and will not be held at a bank or broker. Please provide the below information for all New Common Stock to be issued on the books and records at the transfer agent.

 

	
Name of   Registered Party:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address 1:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address 2:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
City/State/Zip:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Contact Name:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Telephone:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Email:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
U.S. Federal Tax   EIN/SSN :
    	
 
    	
 
    
	
 
    	
 
    
	
Account Type (a   list of account types can be found on Schedule 1):
    	
 
    
									

 

8

 

Item 8.         Certification. I certify that I am the holder, or the authorized signatory of the holder, of the amount of the security listed under Item 1 above. Additionally, I certify that we have submitted or have caused to be submitted a valid vote to “accept” the Plan for the amount of security listed under item 1 above.

 

	
Date:        , 2019
    	
 
    	
Name of Holder:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Social Security or Federal Tax I.D. No.:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Signature:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Name of Person Signing:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Street Address:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
City, State, Zip Code:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Telephone Number:
    	
 
    
											

 

THE COMPLETED FORM MUST BE RECEIVED BY THE SUBSCRIPTION AGENT AT THE FOLLOWING ADDRESS BY THE SUBSCRIPTION EXPIRATION DEADLINE:

 

AEGERION PHARMACEUTICALS, INC. SUBSCRIPTION PROCESSING

C/O PRIME CLERK LLC

ONE GRAND CENTRAL PLACE

60 EAST 42ND STREET, SUITE 1440

NEW YORK, NY 10165

 

OR VIA EMAIL AT AEGERIONSUBSCRIPTION@PRIMECLERK.COM

 

IN ADDITION, FOR YOUR SUBSCRIPTION RIGHTS AND OVERSUBSCRIPTION RIGHTS TO BE VALIDLY EXERCISED, YOUR COMPLETED BALLOT, INDICATING YOUR ACCEPTANCE OF THE PLAN, MUST BE RECEIVED BY THE SOLICITATION AGENT (AS DEFINED IN THE BALLOT) ON OR BEFORE THE VOTING DEADLINE (AS DEFINED IN THE BALLOT).

 

9

 

SCHEDULE 1

 

Please indicate the “account type” that may be used in connection with registration of your New Common Stock.

 

Please check only one box:

 

o            INDIVIDUAL ACCOUNT;

 

o            IRA ACCOUNT;

 

o            CORPORATIONS (S-CORP): (ASSOCIATED, ASSOCIATES, ASSOCIATION, CO, CO. COMPANY, CORP, COPORATE/PARTNER, ENTERPRISE(S), FUND, GROUP, INCORPORATED, INC, INTERNATIONAL, INTL, LIMITED, LTD, LIFETIME LIMITED COMPANY, LLC, L.L.C, PARTNER, PARTNERS, PLC, PUBLIC LIMITED COMPANY);

 

o            PARTNERSHIP: (LP, L P, L.P., LLP, LIMITED PARTNERSHIP, LIFETIME LIMITED PARTNERSHIP);

 

o            BANK;

 

o            NOMINEE ACCOUNTS;

 

o            THE NEW C-CORP;

 

o            NON-PROFIT: (CEMETERY, CHURCH, COLLEGE, COMMISSION FOR CHRILDREN WITH, COMMISSION FOR HANDICAPPED, COMMISSION MINISTRIES INC, COMMISSION OF PUBLIC WORKS, COMMISSION OF BANKING & FOUNDATIONS, HOSPITAL, SCHOOL, SYNAGOGUE, UNIVERSITY);

 

o            FIDUCIARY ACCOUNT: (CUSTODIAN, CO-TRUSTEE, ESTATE, EXECUTOR, EXECUTRIX FBO, F/B/O, FAO, FIDUCIARY TRUST, ITF, LIFE TEN, PENSION PLAN, INDIVIDUAL NAME PROFIT SHARING PLAN, RETIREMENT PLAN, 401K PLAN, SELL TRANSFER PLEDGE, STATE UNIFORM TRANSFER RO MINOR’S ACT, TTEE, TTEES, UW, UTMA, UGMA,USUFRUCT, UNIFIED, UNIF GIFT MIN ACT, UNIF TRUST MIN ACT, UNIFIED GIFT TO MINORS ACT, UNIFORM GIFT TO MINORS, UNIFORM TRANSFER TO MINORS, GRAT (GRANTOR ANNUNITY TRUST);

 

o            TENANTS IN COMMON;

 

o            TENANTS BY ENTIRETY: (TEN ENT, TENANTS ENT, TENANTS ENTIRETY, TENANTS BY ENTIRETY, TENANTS BY ENTIRETIES);

 

o            JOINT TENANTS: (JT TEN, JT TEN WROS, JT WROS, J/T/W/R/S, JOINT TENANCY, JOINT TENANTS WITH RIGHT OF SURVIVORSHIP, JT OWNERSHIP, IF JT ACCOUNT WITH TOD); OR

 

o            COMMUNITY PROPERTY: (COM PROP, COMM PROP, COM PROPERTY, COMM PROPERTY, MARITAL PROPERTY, HWACP, HUSBAND & WIFE AS COMMUNITY PROPERTY).

 

10

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