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FLAGSHIP CLO VIII, LTD. FLAGSHIP CLO VIII, LLC
NOTICE OF PARTIAL REDEMPTION BY REFINANCING
Date of Notice: May 16, 2018 Redemption Date: June 7, 2018
NOTE: THIS NOTICE CONTAINS IMPORTANT INFORMATION THAT IS OF INTEREST TO THE REGISTERED AND BENEFICIAL OWNERS OF THE NOTES. IF APPLICABLE, ALL DEPOSITORIES, CUSTODIANS, AND OTHER INTERMEDIARIES RECEIVING THIS NOTICE ARE REQUESTED TO EXPEDITE RE-TRANSMITTAL TO BENEFICIAL OWNERS OF THE NOTES IN A TIMELY MANNER.
To: The each Holder of Notes* as described as follows:
Class of
Notes
Rule 144A Regulation S Accredited Investor
CUSIP ISIN CUSIP ISIN CUSIP ISIN
Class A-R Notes 338422AJ7 US338422AJ78 G35305AE4 USG35305AE46 N/A N/A
Class B-R Notes 338422AL2 US338422AL25 G35305AF1 USG35305AF11 N/A N/A
Class C-R Notes 338422AN8 US338422AN80 G35305AG9 USG35305AG93 N/A N/A
Class D Notes 338422AG3 US338422AG30 G35305AD6 USG35305AD62 N/A N/A
Class E Notes 338424AA2 US338424AA26 G35302AA9 USG35302AA92 338424AB0 US338424AB09
Class F Notes 338424AC8 US338424AC81 G35302AB7 USG35302AB75 338424AD6 US338424AD64
Subordinated Notes 338424AE4 US338424AE48 G35302AC5 USG35302AC58 338424AF1 US338424AF13
Income Notes 338421AA8 US338421AA86 G35301AA1 USG35301AA10 338421AB6 US338421AB69
To: Those Additional Addressees listed on Schedule I hereto.
Reference is hereby made to that certain Indenture dated as of November 19, 2014 (as supplemented, amended or modified from time to time, the “Indenture”), among Flagship CLO VIII, Ltd., as Issuer (the “Issuer”), Flagship CLO VIII, LLC, as Co-Issuer (the “Co-Issuer”, and
∗ No representation is made as to the correctness of the CUSIP, ISIN or Common Code numbers either as printed on the Notes or as contained in this notice. Such numbers are included solely for the convenience of the Holders.
together with the Issuer, the “Co-Issuers”) and U.S. Bank National Association, as Trustee (the “Trustee”). Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Indenture.
Pursuant to Section 9.2 of the Indenture, the Issuer has provided notice to the Trustee that it has received the direction of the Required Directing Persons to effect a Refinancing of the Class A-R Notes, the Class B-R Notes, the Class C-R Notes, the Class D Notes and the Class E Notes (collectively, the “Refinanced Notes”) pursuant to Section 9.2(b) of the Indenture.
In accordance with Section 9.3 of the Indenture, the Trustee hereby provides notice (on behalf of and at the expense of the Co-Issuers) of the following information relating to the Partial Redemption by Refinancing:
(a) The Redemption Date for the Refinanced Notes will be June 7, 2018.
(b) The Redemption Price for each Refinanced Note shall be:
For the Class A-R Notes, $276,429,082.42, which is an amount equal to the outstanding principal amount of the Class A-R Notes, plus accrued and unpaid interest, including any Cumulative Interest Amount;
For the Class B-R Notes, $54,818,643.15, which is an amount equal to the outstanding principal amount of the Class B-R Notes, plus accrued and unpaid interest, including any Cumulative Interest Amount;
For the Class C-R Notes, $30,335,941.84, which is an amount equal to the outstanding principal amount of the Class C-R Notes, plus accrued and unpaid interest, including any Cumulative Interest Amount;
For the Class D Notes, $22,948,733.81, which is an amount equal to the outstanding principal amount of the Class D Notes, plus accrued and unpaid interest, including any Cumulative Interest Amount; and
For the Class E Notes, $21,026,766.15, which is an amount equal to the outstanding principal amount of the Class E Notes, plus accrued and unpaid interest, including any Cumulative Interest Amount.
(c) all of the Class A-R Notes, the Class B-R Notes, the Class C-R Notes, the Class D Notes and the Class E Notes are being redeemed in full and interest on such Class of Notes shall cease to accrue on the Redemption Date. No other Class of Notes is being redeemed on the Redemption Date.
(d) the place where the Refinanced Notes (if Certificated Notes) are to be surrendered for payment of the Redemption Price is:
By Hand, Overnight Courier or First Class Registered/Certified Mail (to the Trustee):
U.S. Bank National Association Attn: Bondholder Services-EP-WS2N 111 Fillmore Avenue East St. Paul, MN 55107
(e) The Indenture provides that any notice of redemption may be withdrawn by the Issuer on or prior to the third Business Day prior to the proposed Redemption Date, subject to the terms and satisfaction of any conditions set forth in the Indenture.
Under current United States federal income tax law, a trustee making payment of interest or principal on securities may be obligated to apply backup withholding to payments of the interest or principal payable to a holder who (i) has failed to furnish the trustee with a valid taxpayer identification number and certifications that the holder is not subject to backup withholding under the Internal Revenue Code of 1986, as amended (the “Code”) and that the holder is a United States person (including a U.S. resident alien) as defined by the Code or (ii) has failed to provide appropriate certification to establish that the holder is not a United States person. Holders of Notes who are United States persons and wish to avoid the application of these provisions should submit a completed IRS Form W-9 when presenting the Notes for payment. Holders of Notes who are non-United States persons should submit an appropriate IRS Form W-8.
This Notice is being sent to each Holder of Notes by U.S. Bank National Association in its capacity as Trustee. Questions regarding this notice may be directed to the Trustee by contacting Jeffrey Stone at telephone (617) 603-6538 or by e-mail at [email protected].
The CUSIP, ISIN and Common Code numbers appearing in this notice are included solely for the convenience of the Holders. The Trustee is not responsible for the selection or use of the CUSIP, ISIN or Common Code numbers, or for the accuracy or correctness of CUSIP, ISIN or Common Code numbers printed on the Notes or as indicated in this notice. Recipients of this notice are cautioned that this notice is not evidence that the Trustee will recognize the recipient as a Holder. Under the Indenture, the Trustee is required only to recognize and treat the person in whose name a Note is registered on the registration books maintained by the Trustee as a Holder.
U.S. BANK NATIONAL ASSOCIATION, as Trustee
SCHEDULE I
Additional Parties
Issuer: Flagship CLO VIII, Ltd. c/o MaplesFS Limited P.O. Box 1093, Boundary Hall Cricket Square Grand Cayman, KY1-1102 Cayman Islands Attention: The Directors Facsimile no.: +1 (345) 945-7100 email: [email protected]
Co-Issuer: Flagship CLO VIII, LLC c/o Puglisi & Associates 850 Library Avenue, Suite 204 Newark, Delaware 19711 Attention: Independent Manager Facsimile no.: +1 (302) 738-7210 Email: [email protected]
Income Note Issuer: Flagship CLO VIII Investor, Ltd. c/o MaplesFS Limited P.O. Box 1093, Boundary Hall Cricket Square Grand Cayman, KY1-1102 Cayman Islands Attention: The Directors Facsimile no.: +1 (345) 945-7100 email: [email protected]
Portfolio Manager: Deutsche Investment Management Americas Inc. 345 Park Avenue New York, New York 10154-0004 Attention: James T. Anderson Facsimile no.: (212)-454-0241
Rating Agencies: Moody's Investors Services, Inc. 7 World Trade Center 250 Greenwich Street New York, New York 10007 Attn: CBO/CLO Monitoring E-mail: [email protected] Facsimile: (212) 553-0355
S&P Global Ratings 55 Water Street, 41st Floor New York, New York 10041 Facsimile: (212) 438-2664 Attention: CBO/CLO Surveillance Email: [email protected]
Irish Stock Exchange: The Irish Stock Exchange plc McCann FitzGerald Listing Services Limited Riverside One, Sir John Rogerson’s Quay Dublin 2, Ireland Facsimile no.: (353) 829-0010 Email: Tony. [email protected]
FLAGSHIP CLO VIII, LTD. FLAGSHIP CLO VIII, LLC
NOTICE OF PROPOSED SECOND SUPPLEMENTAL INDENTURE
Date of Notice: May 16, 2018
NOTE: THIS NOTICE CONTAINS IMPORTANT INFORMATION THAT IS OF INTEREST TO THE REGISTERED AND BENEFICIAL OWNERS OF THE SUBJECT NOTES AND INCOME NOTES. IF APPLICABLE, ALL DEPOSITORIES, CUSTODIANS, AND OTHER INTERMEDIARIES RECEIVING THIS NOTICE ARE REQUESTED TO EXPEDITE RE-TRANSMITTAL TO BENEFICIAL OWNERS OF THE NOTES AND INCOME NOTES IN A TIMELY MANNER.
To: The Holders of the Securities as described on the attached Schedule B and to those Additional Parties listed on Schedule A hereto:
Reference is hereby made to that certain (i) Indenture dated as of November 19, 2014 (as supplemented, amended or modified from time to time, the “Indenture”), among Flagship CLO VIII, Ltd., as Issuer (the “Issuer”), Flagship CLO VIII, LLC, as Co-Issuer (the “Co-Issuer”, and together with the Issuer, the “Co-Issuers”) and U.S. Bank National Association, as Trustee (in such capacity, the “Trustee”) and (ii) Income Note Paying Agency Agreement dated as of November 19, 2014 (as supplemented, amended or modified from time to time, the “Income Note Paying Agency Agreement”), between Flagship CLO VIII Investor, Ltd., as Income Note Issuer (the “Income Note Issuer”) and U.S. Bank National Association, as Income Note Paying Agent (in such capacity, the “Income Note Paying Agent”) and as Income Note Registrar (in such capacity, the “Income Note Registrar”). Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Indenture or the Income Note Paying Agency Agreement, as applicable.
Pursuant to Section 8.3(b) of the Indenture and Section 5.1 of the Income Note Paying Agency Agreement, on behalf of and at the expense of the Co-Issuers and the Income Note Issuer, as applicable, the Trustee and the Income Note Paying Agent hereby provide this notice of a proposed second supplemental indenture (substantially in the form attached hereto as Exhibit A) (the “Second Supplemental Indenture”) to the Rating Agencies and the Holders of each Class of Notes and the Income Notes.
THE TRUSTEE AND THE INCOME NOTE PAYING AGENT MAKE NO STATEMENT AS TO THE RIGHTS OF THE HOLDERS IN RESPECT OF THE SECOND SUPPLEMENTAL INDENTURE, ASSUME NO RESPONSIBILITY OR LIABILITY FOR THE CONTENTS OR SUFFICIENCY OF THE SECOND SUPPLEMENTAL INDENTURE, AND MAKE NO RECOMMENDATIONS AS TO ANY ACTION TO BE TAKEN WITH RESPECT TO THE SECOND SUPPLEMENTAL INDENTURE. HOLDERS ARE ADVISED TO CONSULT THEIR OWN LEGAL OR INVESTMENT ADVISOR.
This Notice is being sent to Holders of Notes and Income Notes by U.S. Bank National Association in its capacities as Trustee and as Income Note Paying Agent at the request of the Issuer and the Income Note Issuer. Questions regarding this notice may be directed to the Trustee or the Income Note Paying Agent, as applicable, by contacting Jeffrey Stone at telephone (617) 603-6538 or by e-mail at [email protected].
The CUSIP, ISIN and Common Code numbers appearing in this notice are included solely for the convenience of the Holders. The Trustee and the Income Note Paying Agent are not responsible for the selection or use of the CUSIP, ISIN or Common Code numbers, or for the accuracy or correctness of CUSIP, ISIN or Common Code numbers printed on the Notes, the Income Notes or as indicated in this notice. Recipients of this notice are cautioned that this notice is not evidence that the Trustee or the Income Note Paying Agent will recognize the recipient as a Holder. Under the Indenture and the Income Note Paying Agency Agreement, as applicable, the Trustee and the Income Note Paying Agent are required only to recognize and treat the person in whose name a Note or Income Note is registered on the registration books maintained by the Trustee or the Income Note Registrar, as applicable, as a Holder.
U.S. BANK NATIONAL ASSOCIATION, as Trustee and Income Note Paying Agent
SCHEDULE A Additional Parties
Issuer: Flagship CLO VIII, Ltd. c/o MaplesFS Limited P.O. Box 1093, Boundary Hall Cricket Square Grand Cayman, KY1-1102 Cayman Islands Attention: The Directors Facsimile no.: +1 (345) 945-7100 email: [email protected]
Co-Issuer: Flagship CLO VIII, LLC c/o Puglisi & Associates 850 Library Avenue, Suite 204 Newark, Delaware 19711 Attention: Independent Manager Facsimile no.: +1 (302) 738-7210 Email: [email protected]
Income Note Issuer: Flagship CLO VIII Investor, Ltd. c/o MaplesFS Limited P.O. Box 1093, Boundary Hall Cricket Square Grand Cayman, KY1-1102 Cayman Islands Attention: The Directors Facsimile no.: +1 (345) 945-7100 email: [email protected]
Portfolio Manager: Deutsche Investment Management Americas Inc. 345 Park Avenue New York, New York 10154-0004 Attention: James T. Anderson Facsimile no.: (212)-454-0241
Rating Agencies: Moody's Investors Services, Inc. 7 World Trade Center 250 Greenwich Street New York, New York 10007 Attn: CBO/CLO Monitoring E-mail: [email protected] Facsimile: (212) 553-0355
S&P Global Ratings 55 Water Street, 41st Floor New York, New York 10041 Facsimile: (212) 438-2664 Attention: CBO/CLO Surveillance Email: [email protected]
Irish Stock Exchange: The Irish Stock Exchange plc McCann FitzGerald Listing Services Limited Riverside One, Sir John Rogerson’s Quay Dublin 2, Ireland Facsimile no.: (353) 829-0010 Email: Tony. [email protected]
SCHEDULE B*
Class of
Notes
Rule 144A Regulation S Accredited Investor
CUSIP ISIN CUSIP ISIN CUSIP ISIN
Class A-R Notes 338422AJ7 US338422AJ78 G35305AE4 USG35305AE46 N/A N/A
Class B-R Notes 338422AL2 US338422AL25 G35305AF1 USG35305AF11 N/A N/A
Class C-R Notes 338422AN8 US338422AN80 G35305AG9 USG35305AG93 N/A N/A
Class D Notes 338422AG3 US338422AG30 G35305AD6 USG35305AD62 N/A N/A
Class E Notes 338424AA2 US338424AA26 G35302AA9 USG35302AA92 338424AB0 US338424AB09
Class F Notes 338424AC8 US338424AC81 G35302AB7 USG35302AB75 338424AD6 US338424AD64
Subordinated Notes 338424AE4 US338424AE48 G35302AC5 USG35302AC58 338424AF1 US338424AF13
Income Notes 338421AA8 US338421AA86 G35301AA1 USG35301AA10 338421AB6 US338421AB69
* No representation is made as to the correctness of the CUSIP, ISIN or Common Code numbers either as printed on the Notes or as contained in this notice. Such numbers are included solely for the convenience of the Holders
EXHIBIT A
PROPOSED SECOND SUPPLEMENTAL INDENTURE
DRAFT
USActive 44540050.6
SECOND SUPPLEMENTAL INDENTURE
to the
INDENTURE dated as of November 19, 2014
by and among
FLAGSHIP CLO VIII, LTD., as Issuer,
FLAGSHIP CLO VIII, LLC, as Co-Issuer,
and
U.S. BANK NATIONAL ASSOCIATION, as Trustee
This SECOND SUPPLEMENTAL INDENTURE dated as of [__], 2018 (this “Supplemental Indenture”) to the Indenture dated as of November 19, 2014 (as amended, modified or supplemented prior to the date hereof, the “Indenture”) is entered into among Flagship CLO VIII, Ltd., an exempted company incorporated with limited liability under the laws of the Cayman Islands (the “Issuer”), Flagship CLO VIII, LLC, a limited liability company formed under the laws of the State of Delaware (the “Co-Issuer” and, together with the Issuer, the “Co-Issuers”), and U.S. Bank National Association, a national banking association, as trustee under the Indenture (together with its permitted successors in such capacity, the “Trustee”). Capitalized terms used but not otherwise defined herein shall have the respective meanings set forth in the Indenture.
PRELIMINARY STATEMENT
WHEREAS, the Co-Issuers wish to amend the Indenture pursuant to Section 8.1(21) and Section 8.2 of the Indenture to effect the modifications set forth in Section 1 below and an Optional Redemption by Refinancing in conformity with Section 9.2(b) of the Indenture;
WHEREAS, the conditions set forth for entry into a supplemental indenture pursuant to Sections 8.1, 8.2 and 8.3 of the Indenture have been satisfied;
WHEREAS, the conditions set forth in Section 9.2(b) of the Indenture to the Optional Redemption by Refinancing to be effected from the proceeds of the Refinancing Notes (as defined below) have been satisfied; and
WHEREAS, the Collateral Manager (based on advice of nationally recognized counsel experienced in such matters) has determined that the rules implementing the credit risk retention requirements of Section 941 of the Dodd-Frank Wall Street Reform and Consumer Protection
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Act are no longer effective with respect to the transactions contemplated by this Supplemental Indenture;
NOW, THEREFORE, in consideration of the mutual agreements herein set forth, the parties agree as follows:
1. Amendments. Effective as of the date hereof upon satisfaction of the conditions set forth in Section 2 below, the following amendments are made to the Indenture pursuant to Section 8.1(21) and Section 8.2 of the Indenture: 1
(i) Section 1.1 of the Indenture is amended by (x) deleting the definitions of “Class A-R Notes,” “Class B-R Notes,” “Class C-R Notes” and “Refinancing Notes” set forth therein and (y) inserting the following new definitions in alphabetical order:
““Class A-RR Notes”: The Class A-RR Floating Rate Notes due 2026 issued by the Co-Issuers pursuant to this Indenture and having the characteristics specified in Section 2.3.”
““Class B-RR Notes”: The Class B-RR Floating Rate Notes due 2026 issued by the Co-Issuers pursuant to this Indenture and having the characteristics specified in Section 2.3.”
““Class C-RR Notes”: The Class C-RR Deferrable Floating Rate Notes due 2026 issued by the Co-Issuers pursuant to this Indenture and having the characteristics specified in Section 2.3.”
““Class D-R Notes”: The Class D-R Deferrable Floating Rate Notes due 2026 issued by the Co-Issuers pursuant to this Indenture and having the characteristics specified in Section 2.3.”
““Class E-R Notes”: The Class E-R Deferrable Floating Rate Notes due 2026 issued by the Issuer pursuant to this Indenture and having the characteristics specified in Section 2.3.”
““First Refinancing Date”: February 22, 2017.”
““Second Refinancing Date”: [__], 2018.”
““Second Refinancing Purchase Agreement”: The purchase agreement dated as of the Second Refinancing Date, by and among the Co-Issuers and the Initial Purchaser in respect of the replacement notes purchased by
1 The modifications set forth in this draft Supplemental Indenture may be revised, in form acceptable to the Co-Issuers, the Collateral Manager and the Trustee, in the event one or more Classes of Notes identified herein will not be redeemed on the Second Refinancing Date or any indicated modifications will not be effected.
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the Initial Purchaser on the Second Refinancing Date, as amended from time to time.”
(ii) The following definitions set forth in Section 1.1 of the Indenture are amended and restated in their entirety as follows:
““Class A Notes”: (i) Prior to the First Refinancing Date, the Class A Floating Rate Notes issued on the Closing Date, (ii) on and after the First Refinancing Date and prior to the Second Refinancing Date, the Class A-R Floating Rate Notes issued on the First Refinancing Date and (iii) on and after the Second Refinancing Date, the Class A-RR Notes.”
““Class B Notes”: (i) Prior to the First Refinancing Date, the Class B Floating Rate Notes issued on the Closing Date, (ii) on and after the First Refinancing Date and prior to the Second Refinancing Date, the Class B-R Floating Rate Notes issued on the First Refinancing Date and (iii) on and after the Second Refinancing Date, the Class B-RR Notes.”
““Class C Notes”: (i) Prior to the First Refinancing Date, the Class C Deferrable Floating Rate Notes issued on the Closing Date, (ii) on and after the First Refinancing Date and prior to the Second Refinancing Date, the Class C-R Deferrable Floating Rate Notes issued on the First Refinancing Date and (iii) on and after the Second Refinancing Date, the Class C-RR Notes.”
““Class D Notes”: (i) Prior to the Second Refinancing Date, the Class D Deferrable Floating Rate Notes issued on the Closing Date and (ii) on and after the Second Refinancing Date, the Class D-R Notes.”
““Class E Notes”: (i) Prior to the Second Refinancing Date, the Class E Deferrable Floating Rate Notes issued on the Closing Date and (ii) on and after the Second Refinancing Date, the Class E-R Notes.”
““FATCA”: Sections 1471 through 1474 of the Code, any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b) of the Code, or any U.S. or non-U.S. fiscal or regulatory legislation, rules, guidance notes or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such sections of the Code or analogous provisions of non-U.S. law.”
““Initial Purchaser”: Deutsche Bank Securities Inc., in its capacity as initial purchaser of (i) the Notes issued on the Closing Date under the Purchase Agreement, (ii) the Notes issued on the First Refinancing Date under the Refinancing Notes Purchase Agreement and (iii) the Notes issued on the Second Refinancing Date under the Second Refinancing Purchase Agreement.”
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““Listed Notes”: On and after the Second Refinancing Date, no Class or Classes of Notes.”
““Purchase Agreement”: Collectively, (i) the purchase agreement, dated on or prior to the Closing Date among the Co-Issuers, the Income Note Issuer and the Initial Purchaser, (ii) the Refinancing Notes Purchase Agreement and (iii) the Second Refinancing Purchase Agreement, in each case, as modified, amended and supplemented and in effect from time to time.”
“Refinancing Date”: The meaning specified in Section 9.2(b).
““Weighted Average Life Test”: A test that will be satisfied on any Measurement Date if the Weighted Average Life of the Collateral Obligations as of such date is less than or equal to the greater of (i) zero and (ii) (x) the Maximum Average Life Value less (y) (A) the number of days that have elapsed since the Closing Date through the date of determination divided by (B) 365 (rounded to the nearest one hundredth thereof)” plus (z) [one].
(iii) The definition of “Designated Maturity” set forth in Section 1.1 of the Indenture is amended and restated in its entirety as follows:
“Designated Maturity”: Three months; provided that with respect to the period from the Second Refinancing Date to the first Payment Date thereafter, LIBOR applicable to the Notes issued on the Second Refinancing Date will be determined by interpolating between the rate for the next shorter period of time for which rates are available and the rate for the next longer period of time for which rates are available.
(iv) The definition of “Periodic Interest Accrual Period” set forth in Section 1.1 of the Indenture is amended by restating the proviso at the end of the first sentence thereof as follows:
“; provided that, the first Periodic Interest Accrual Period with respect to any class of replacement notes issued in connection with an Optional Redemption by Refinancing shall begin on the applicable Refinancing Date.”
(v) Each of Sections 2.2(e), 2.5(c)(i), 2.5(c)(ii) and 2.5(i)(4)(B) of the Indenture is amended by inserting “or the Second Refinancing Date” after the phrase “on the Closing Date” set forth therein.
(vi) The table set forth in Section 2.3(b) of the Indenture is amended by replacing the table rows labeled “Designation” and “Applicable Periodic Rate” with the corresponding rows in the table set forth in Annex A hereto.
(vii) Section 9.2(b) of the Indenture shall be amended by deleting the following proviso at the end of the first sentence thereof:
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“provided, further, that no Class of Refinancing Notes may be subject to a Refinancing, except to the extent that a change of law, rule or regulation or regulatory guidance following the date hereof would permit a Refinancing without resulting in non-compliance with the rules implementing the credit risk retention requirements of Section 941 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, as amended from time to time or if such rules are no longer effective, as determined by the Collateral Manager (based on advice of nationally recognized counsel experienced in such matters, an oral or written summary of which will be provided to the Required Directing Persons upon request)”.
(viii) Section 9.6 of the Indenture shall be amended by deleting the following proviso at the end of the first sentence thereof:
“provided, further, that no Class of Refinancing Notes may be subject to a Re-Pricing, except to the extent that a change of law, rule or regulation or regulatory guidance following the date hereof would permit a Re-Pricing without resulting in non-compliance with the rules implementing the credit risk retention requirements of Section 941 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, as amended from time to time or if such rules are no longer effective, as determined by the Collateral Manager (based on advice of nationally recognized counsel experienced in such matters, an oral or written summary of which will be provided to the Required Directing Persons upon request)”.
(ix) Schedule 3 to the Indenture is amended by replacing the table set forth therein with the table set forth in Annex B hereto.
(x) Schedule 6 to the Indenture is amended by replacing Table 1 set forth in Section 1 thereof with the table set forth in Annex C hereto.
(xi) Each of Exhibits A-1 to A-5 of the Indenture is amended by (1) replacing all references therein to “Class A-R Note,” “Class B-R Note,” “Class C-R Note,” “Class D Note” and “Class E Note” with “Class A-RR Note,” “Class B-RR Note,” “Class C-RR Note,” “Class D-R Note” and “Class E-R Note,” respectively, (2) replacing all references therein to “Class A-R Floating Rate Notes,” “Class B-R Floating Rate Notes,” “Class C-R Deferrable Floating Rate Notes,” “Class D Deferrable Floating Rate Notes” and “Class E Floating Rate Notes” with “Class A-RR Floating Rate Notes,” “Class B-RR Floating Rate Notes,” “Class C-RR Deferrable Floating Rate Notes,” “Class D-R Deferrable Floating Rate Notes” and “Class E-R Floating Rate Notes,” respectively, (3) replacing the clause “commencing in April 2017” or “commencing in April 2015,” as applicable, set forth therein with “commencing in July 2018,” (4) replacing the spread set forth therein with the spread set forth in the table in Annex A hereto applicable to the applicable Class of Notes and (5) making such other modifications reasonably acceptable to the Trustee and the Collateral Manager in order to make such form Notes consistent with the terms of the Refinancing Notes.
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2. Conditions Precedent. The modifications to be effected pursuant to Section 1 above shall become effective as of the date first written above upon receipt by the Trustee of each of the following:
(i) an Officer’s certificate of each of the Co-Issuers (A) evidencing the authorization by Resolution of the execution and delivery of this Supplemental Indenture and the Refinancing Notes Purchase Agreement and the execution, authentication and delivery of the Class A-RR Notes, Class B-RR Notes, Class C-RR Notes, Class D-R Notes and Class E-R Notes (collectively, the “Refinancing Notes”) applied for by it and specifying the Stated Maturity, principal amount and Applicable Periodic Rate of each Class of Refinancing Notes to be authenticated and delivered, and (B) certifying that (1) the attached copy of the Resolution is a true and complete copy thereof, (2) such resolutions have not been rescinded and are in full force and effect on and as of the Second Refinancing Date and (3) the Officers authorized to execute and deliver such documents hold the offices and have the signatures indicated thereon;
(ii) from each of the Co-Issuers either (A) a certificate of the Applicable Issuer or other official document evidencing the due authorization, approval or consent of any governmental body or bodies, at the time having jurisdiction in the premises, together with an Opinion of Counsel of such Applicable Issuer to the effect that no other authorization, approval or consent of any governmental body is required for the valid issuance of the Refinancing Notes, or (B) an Opinion of Counsel of the Applicable Issuer to the effect that no such authorization, approval or consent of any governmental body is required for the valid issuance of such Refinancing Notes except as have been given (provided that the opinions delivered pursuant to clause (iii) below may satisfy this requirement);
(iii) opinions of (i) Cadwalader, Wickersham & Taft LLP, special U.S. counsel to the Co-Issuers, (ii) Nixon Peabody LLP, counsel to the Trustee, and (iii) Maples and Calder, Cayman Islands counsel to the Issuer, in each case dated the Second Refinancing Date, in form and substance satisfactory to the Issuer;
(iv) an Officer’s certificate of each of the Co-Issuers stating that the Applicable Issuer is not in default under the Indenture and that the issuance of the Refinancing Notes applied for by it shall not result in a default or a breach of any of the terms, conditions or provisions of, or constitute a default under, its organizational documents, any indenture or other agreement or instrument to which it is a party or by which it is bound, or any order of any court or administrative agency entered in any Proceeding to which it is a party or by which it may be bound or to which it may be subject; that all conditions precedent provided in the Indenture relating to the authentication and delivery of the Refinancing Notes applied for by it have been complied with; that all expenses due or accrued with respect to the offering of such Refinancing Notes or relating to actions taken on or in connection with the Second Refinancing Date have been paid or reserves therefor have been made; and that all of its representations and warranties contained in the Indenture are true and correct as of the Second Refinancing Date;
(v) a letter signed by each applicable Rating Agency confirming that the Class A-RR Notes are rated “Aaa(sf)” by Moody’s and “AAA (sf)” by S&P, the Class B-RR Notes are rated at least “[AA] (sf)” by S&P, the Class C-RR Notes are rated at least “[A] (sf)” by S&P, the Class
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D-R Notes are rated at least “[BBB] (sf)” by S&P and the Class E-R Notes are rated at least “[BB-] (sf)” by S&P; and
(vi) an Issuer Order by each Co-Issuer directing the Trustee to authenticate the Refinancing Notes in the amounts and names set forth therein and to apply the proceeds thereof to redeem the Class A Notes, Class B Notes, Class C Notes, Class D Notes and Class E Notes issued on the Closing Date or the First Refinancing Date, as applicable, at the applicable Redemption Prices therefor on the Second Refinancing Date.
3. Governing Law.
THIS SUPPLEMENTAL INDENTURE AND EACH NOTE AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS AGREEMENT, THE RELATIONSHIP OF THE PARTIES, AND/OR THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED IN ALL RESPECTS (WHETHER IN CONTRACT OR IN TORT) BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS.
4. Execution in Counterparts.
This Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. Delivery of an executed counterpart of this Supplemental Indenture by electronic means (including email or telecopy) will be effective as delivery of a manually executed counterpart of this Supplemental Indenture.
5. Concerning the Trustee.
The recitals contained in this Supplemental Indenture shall be taken as the statements of the Co-Issuers, and the Trustee assumes no responsibility for their correctness. Except as provided in the Indenture, the Trustee shall not be responsible or accountable in any way whatsoever for or with respect to the validity, execution or sufficiency of this Supplemental Indenture and makes no representation with respect thereto. In entering into this Supplemental Indenture, the Trustee shall be entitled to the benefit of every provision of the Indenture relating to the conduct of or affecting the liability of or affording protection to the Trustee.
6. No Other Changes.
Except as provided herein, the Indenture shall remain unchanged and in full force and effect, and each reference to the Indenture and words of similar import in the Indenture, as amended hereby, shall be a reference to the Indenture as amended hereby and as the same may be further amended, supplemented and otherwise modified and in effect from time to time. This Supplemental Indenture may be used to create a conformed amended and restated Indenture for the convenience of administration by the parties hereto.
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7. Execution, Delivery and Validity.
Each of the Co-Issuers represents and warrants to the Trustee that (i) this Supplemental Indenture has been duly and validly executed and delivered by it and constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms and (ii) the execution of this Supplemental Indenture is authorized or permitted under the Indenture and all conditions precedent thereto have been satisfied.
8. Non-Petition; Limited Recourse.
The parties hereto agree to the provisions set forth in Sections 2.7(i) and 5.4(d) of the Indenture, and such provisions are incorporated in this Supplemental Indenture, mutatis mutandis.
9. Binding Effect.
This Supplemental Indenture shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
10. Direction to the Trustee.
Each of the Co-Issuers hereby directs the Trustee to execute this Supplemental Indenture and acknowledges and agrees that the Trustee will be fully protected in relying upon the foregoing direction.
[Signature Page to Supplemental Indenture]
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and delivered by their respective proper and duly authorized officers as of the day and year first above written.
EXECUTED AS A DEED BY:
FLAGSHIP CLO VIII, LTD. as Issuer
By: ____________________________________ Name: Title:
FLAGSHIP CLO VIII, LLC as Co-Issuer
By: ____________________________________ Name: Title:
U.S. BANK NATIONAL ASSOCIATION as Trustee
By: ____________________________________ Name: Title:
[Signature Page to Supplemental Indenture]
CONSENTED TO AND AGREED:
DEUTSCHE INVESTMENT MANAGEMENT AMERICAS, INC. as Collateral Manager
By: ____________________________________ Name: Title:
Annex A
ANNEX A
Designation Class A-RR
Notes Class B-RR
Notes Class C-RR
Notes Class D-R
Notes Class E-R
Notes Class F Notes Subordinated
Notes
Applicable Periodic Rate(2)
LIBOR + [__]%
LIBOR + [__]%
LIBOR + [__]%
LIBOR + [__]%
LIBOR + [__]%
LIBOR + 5.85%
N/A
Annex B
ANNEX B
Industry Code Description Industry Code Description 0 Zero Default Risk 5220000 Personal products 1020000 Energy equipment and services 6020000 Healthcare equipment and supplies 1030000 Oil, gas and consumable fuels 6030000 Healthcare providers and services
1033403 Mortgage real estate investment trusts (Mortgage REITs)
6110000 Biotechnology
2020000 Chemicals 6120000 Pharmaceuticals 2030000 Construction materials 7011000 Banks 2040000 Containers and packaging 7020000 Thrifts and mortgage finance 2050000 Metals and mining 7110000 Diversified financial services 2060000 Paper and forest products 7120000 Consumer finance 3020000 Aerospace and defense 7130000 Capital markets 3030000 Building products 7210000 Insurance
3040000 Construction and engineering 7310000 Real estate management and development
3050000 Electrical equipment 7311000 Equity real estate investment trusts (Equity REITs)
3060000 Industrial conglomerates 8020000 Internet software and services 3070000 Machinery 8030000 IT services
3080000 Trading companies and distributors
8040000 Software
3110000 Commercial services and supplies 8110000 Communications equipment
3210000 Air freight and logistics 8120000 Technology hardware, storage, and peripherals
3220000 Airlines 8130000 Electronic equipment, instruments, and components
3230000 Marine 8210000 Semiconductors and semiconductor equipment
3240000 Road and rail 9020000 Diversified telecommunication services
3250000 Transportation infrastructure 9030000 Wireless telecommunication services
4011000 Auto components 9520000 Electric utilities 4020000 Automobiles 9530000 Gas utilities 4110000 Household durables 9540000 Multi-utilities 4120000 Leisure products 9550000 Water utilities
4130000 Textiles, apparel, and luxury goods
9551701 Diversified consumer services
4210000 Hotels, restaurants, and leisure 9551702 Independent power and renewable energy producers
4310000 Media 9551727 Life sciences tools and services 4410000 Distributors 9551729 Health care technology 4420000 Internet and catalog retail 9612010 Professional services4430000 Multiline retail 9612010 Professional services4440000 Specialty retail PF1 Project finance: industrial equipment5020000 Food and staples retailing PF2 Project finance: leisure and gaming
5110000 Beverages PF3 Project finance: natural resources and mining
Annex B
5120000 Food products PF4 Project finance: oil and gas 5130000 Tobacco PF5 Project finance: power
5210000 Household products PF6 Project finance: public finance and real estate
PF7 Project finance: telecommunicationsPF8 Project finance: transport
Annex C
ANNEX C
S&P Recovery Rates For Collateral Obligations With S&P Asset Specific Recovery Ratings*
Notes rating categories
S&P Assigned Recovery Rating
Recovery Point Estimate*
AAA AA A BBB BB B/CCC
1+ 100 75% 85% 88% 90% 92% 95%
1 95 70% 80% 84% 87% 91% 95% 1 90 65% 75% 80% 85% 90% 95% 2 85 62% 72% 77% 83% 88% 92% 2 80 60% 70% 75% 81% 86% 89% 2 75 55% 65% 70% 77% 82% 84% 2 70 50% 60% 66% 73% 79% 79% 3 65 45% 55% 61% 68% 73% 74% 3 60 40% 50% 56% 63% 67% 69% 3 55 35% 45% 51% 58% 63% 64% 3 50 30% 40% 46% 53% 59% 59%
4 45 28% 37% 44% 49% 53% 54%
4 40 27% 35% 42% 46% 48% 49%
4 35 23% 30% 37% 42% 43% 44%
4 30 20% 26% 33% 39% 39% 39%
5 25 17% 23% 28% 32% 33% 34%
5 20 15% 20% 24% 26% 28% 29%
5 15 10% 15% 19% 22% 23% 24%
5 10 5% 10% 15% 19% 19% 19%
6 5 3% 7% 10% 13% 14% 14%
6 0 2% 4% 6% 8% 9% 9%
*From S&P published reports. If a recovery point estimate is not available for a given loan with a recovery rating, the lowest recovery point estimate for the applicable recovery rating should be assumed.
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