EFTA01422410.pdf

ING IM CLO 2011-1, LTD. Issuer ING IM CLO 2011-1 LLC Co-Issuer AND THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION Trustee INDENTURE Dated as of June 22, 2011 COLLATERALIZED DEBT OBLIGATIONS ING IM CLO 2011-1 EFTA01422410 TABLE OF CONTENTS PAGE PRELIMINARY STATEMENT 1 GRANTING CLAUSES 1 ARTICLE I DEFINITIONS Section 1.1. Definitions 2 Section 1.2. Assumptions as to Collateral Obligations, Etc. 56 ARTICLE II THE SECURITIES Section 2.1. Forms Generally 59 Section 2.2. Authorized Amount; Interest Rate; Stated Maturity; Denominations 59 Section 2.3. Execution, Authentication, Delivery and Dating 61 Section 2.4. Registration, Registration of Transfer and Exchange. 62 Section 2.5. Transfer and Exchange of Securities 64 Section 2.6. Mutilated, Defaced, Destroyed, Lost or Stolen Securities 76 Section 2.7. Payments in Respect of the Securities; Rights Reserved 77 Section 2.8. Cancellation 80 Section 2.9. Funds for Payments to be Held in Trust 80 Section 2.10. Definitive Securities In Event Depository No Longer Available 80 Section 2.11. Ineligible Holders 81 Section 2.12. Additional Securities 82 ARTICLE III CONDITIONS PRECEDENT; COLLATERAL DELIVERY; AND REPRESENTATIONS Section 3.1. General Provisions EFTA01422411  84 Section 3.2. Security for Notes 86 Section 3.3. Effective Date; Purchase of Collateral Obligations During Initial Investment Period 88 Section 3.4. Delivery of Pledged Obligations 89 Section 3.5. Representations and Warranties Concerning Collateral 89 ARTICLE IV SATISFACTION AND DISCHARGE Section 4.1. Satisfaction and Discharge of Indenture 91 Section 4.2. Application of Trust Funds 93 Section 4.3. Repayment of Funds Held by Paying Agent 93 ARTICLE V REMEDIES Section 5.1. Events of Default 94 Section 5.2. Acceleration of Maturity; Rescission and Annulment 95 Section 5.3. Collection of Indebtedness and Suits for Enforcement by Trustee 96 Section 5.4. Remedies 97 Section 5.5. Preservation of Collateral 99 Section 5.6. Trustee May Enforce Claims Without Possession of Securities 101 Section 5.7. Application of Funds Collected 101 Section 5.8. Limitation on Suits 101 ING IM CLO 2011-1 EFTA01422412 Section 5.9. Unconditional Rights of Holders to Receive Principal and Interest 102 Section 5.10. Restoration of Rights and Remedies 103 Section 5.11 Rights and Remedies Cumulative 103 Section 5.12. Delay or Omission Not Waiver 103 Section 5.13. Control by Holders 103 Section 5.14. Waiver of Past Defaults 104 Section 5.15. Undertaking for Costs 104 Section 5.16. Waiver of Stay or Extension Laws 104 Section 5.17. Sale of Collateral 105 Section 5.18. Action on the Securities 106 ARTICLE VI THE TRUSTEE Section 6.1. Certain Duties and Responsibilities 107 Section 6.2. Notice of Default or Acceleration 108 Section 6.3. Certain Rights of Trustee 108 Section 6.4. Authenticating Agents 111 Section 6.5. Not Responsible for Recitals or Issuance of Securities 112 Section 6.6. May Hold Securities 112 Section 6.7. Funds Held in Trust 112 EFTA01422413 Section 6.8. Compensation and Reimbursement 113 Section 6.9. Corporate Trustee Required; Eligibility 114 Section 6.10. Resignation and Removal; Appointment of Successor 114 Section 6.11. Acceptance of Appointment by Successor 115 Section 6.12. Merger, Conversion, Consolidation or Succession to Business of Trustee 116 Section 6.13. Co- Trustees 116 Section 6.14. Certain Duties Related to Delayed Payment of Proceeds 117 Section 6.15. Fiduciary for Holders Only; Agent for Other Secured Parties 118 ARTICLE VII COVENANTS Section 7.1. Payment of Principal and Interest 119 Section 7.2. Maintenance of Office or Agency 119 Section 7.3. Paying Agents. 119 Section 7.4. Existence of the Co- Issuers 121 Section 7.5. Protection of Collateral 121 Section 7.6. Opinions as to Collateral 123 Section 7.7. Performance of Obligations 123 Section 7.8. Negative Covenants 123 Section 7.9. Statement as to Compliance 125 Section 7.10. Co-Issuers May Consolidate, etc., Only on Certain Terms 125 EFTA01422414 Section 7.11. Successor Substituted 127 Section 7.12. No Other Business 127 Section 7.13. Notice of Changes in Ratings 127 Section 7.14. Reporting 127 Section 7.15. Calculation Agent 128 ARTICLE VIII SUPPLEMENTAL INDENTURES Section 8.1. Supplemental Indentures without Consent of Holders 129 Section 8.2. Supplemental Indentures with Consent of Holders 131 ii ING IM CLO 2011-1 EFTA01422415 Section 8.3. Execution of Supplemental Indentures 133 Section 8.4 Effect of Supplemental Indentures 134 Section 8.5. Reference in Securities to Supplemental Indentures 134 ARTICLE IX REDEMPTION Section 9.1. Optional Redemption; Election to Redeem 135 Section 9.2. Notice of Optional Redemption; Cancellation .. 137 Section 9.3. Notes Payable on Redemption Date 138 Section 9 4. Special Redemption 139 ARTICLE X ACCOUNTS, ACCOUNTINGS, RELEASES AND PAYMENTS Section 10.1. Collection; General Account Requirements 140 Section 10.2. Collection Account 141 Section 10.3. Additional Accounts. 142 Section 10.4. Hedge Counterparty Collateral Account; Securities Lending Account 145 Section 10.5. Reports by Trustee 146 Section 10.6. Accountings 146 Section 10.7. Release of Collateral 148 Section 10.8. Reports by Independent Accountants 149 Section 10.9. Reports to Rating Agencies 150 Section 10.10. Tax EFTA01422416 Matters 150 ARTICLE XI APPLICATION OF PROCEEDS Section 11.1. Disbursements from the Payment Account. .. 152 Section 11.2. Disbursements for Certain Expenses. 157 ARTICLE XII SALE OF COLLATERAL OBLIGATIONS; SUBSTITUTION Section 12.1. Sale of Collateral Obligations and Reinvestment 158 Section 12.2. Eligibility Criteria and Trading Restrictions 163 Section 12.3. Conditions Applicable to All Transactions Involving Sale or Grant. 163 Section 12.4. Securities Lending. 164 ARTICLE XIII HOLDERS' RELATIONS Section 13.1. Subordination 169 Section 13.2. Standard of Conduct 169 Section 13.3. Right to List of Holders 170 Section 13.4. Notice and Reports to Holders; Waiver 170 Section 13.5. Holder Meetings 171 Section 13.6. Non - Petition 171 ARTICLE XIV MISCELLANEOUS Section 14.1. Form of Documents Delivered to Trustee .... 172 Section 14.2. Acts of Holders; Voting Rights 172 EFTA01422417 Section 14.3. Notices, etc., to Designated Persons Other Than Holders 173 Section 14.4. Notices to Rating Agencies; Rule 17g-5 Procedures 175 iii ING IM CLO 2011-1 EFTA01422418 Section 14.5. Effect of Headings and Table of Contents .... 176 Section 14.6. Successors and Assigns 176 Section 14.7. Benefits of Indenture 176 Section 14.8. Governing Law 176 Section 14.9. Submission to Jurisdiction 177 Section 14.10. Counterparts 177 Section 14.11. Liability of the Co- Issuers 177 Section 14.12 Severability 177 Section 14.13 Waiver of Jury Trial 177 ARTICLE XV INVESTMENT MANAGEMENT Section 15.1. Assignment of Investment Management Agreement 179 Section 15.2. Standard of Care Applicable to the Investment Manager 179 ARTICLE XVI HEDGE AGREEMENTS Section 16.1. Hedge Agreements 180 Section 16.2. Hedge Counterparty Liens 181 Section 16.3. Other Hedge Agreements; Assignment; Amendments to Hedge Agreements 181 Section 16.4. Consent to Early Termination Dates 182 Schedule A Moody's Industry Classification Group List Schedule B S&P's CDO Monitor Asset Classifications Schedule C Diversity Score Table Schedule D LIBOR Calculation Schedule E Moody's Rating Schedule EFTA01422419 Schedule F S&P Rating Schedule Schedule G Collateral Matrix Schedule H Content of Monthly Report Schedule I Content of Distribution Date Report Exhibit A-1 Form of Class A-1 Note Exhibit A-2 Form of Class A-2 Note Exhibit A-3 Form of Class B Note Exhibit A-4 Form of Class C Note Exhibit A-5 Form of Class D Note Exhibit A-6 Form of Subordinated Note Exhibit 6-1 Form of Certificate (for Transfer to Rule 144A Global Securities) Exhibit B-2 Form of Certificate (for Transfer to Regulation S Global Securities) Exhibit B-3 Form of Certificate (for Transfer to Definitive Securities) Exhibit B-4 Form of Certificate (for Exchange of Definitive Securities) Exhibit Form of Certifying Person Certificate Exhibit D Form of Account Agreement Exhibit E Exhibit F Form of Delaware Tax Subsidiary Organizational Documents Form of Cayman Islands Tax Subsidiary Organizational Documents iv ING IM CLO 2011-1 EFTA01422420 INDENTURE, dated as of June 22, 2011 between: ING IM CLO 2011-1, LTD , an exempted company incorporated with limited liability and existing under the laws of the Cayman Islands (the "Issuer") and ING IM CLO 2011-1 LLC, a limited liability company organized and existing under the laws of the State of Delaware (the "Co-Issuer" and, together with the Issuer, the "Co-Issuers") and THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association, as trustee (herein, together with its permitted successors in the trusts hereunder, the "Trustee"). PRELIMINARY STATEMENT Each of the Co-Issuers is duly authorized to execute and deliver this Indenture to provide for the Notes issuable and secured as provided in this Indenture. All covenants and agreements made by each of the Co-Issuers herein are for the benefit of the Holders and the Trustee and the security of the Secured Parties Each of the Co-Issuers is entering into this Indenture, and the Trustee is accepting the trusts created hereby, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged. All things necessary to make this Indenture a valid agreement of each of the Co-Issuers in accordance with its terms have been done. GRANTING CLAUSES I Subject to the priorities and the exclusions, if any, specified below in this Granting Clause, the Issuer hereby Grants to the Trustee, for the benefit and security of each Secured Party (to the extent of its interest hereunder, including under the Priority of Payments), all of its right, title and interest in, to and under, in each case, whether now owned or existing, or hereafter acquired or arising, all securities, loans and investments and, in each case as defined in the UCC, accounts, chattel paper, deposit accounts, instruments, financial assets, investment property, general intangibles, letter of credit rights, and other supporting obligations, and other property of any type or nature in which the Issuer has an interest, including all proceeds (as defined in the UCC) with respect to the foregoing (subject to the exclusions noted below, the "Collateral"). Such Grants include, but are not limited to (a) the Collateral Obligations and Equity Securities which the Issuer causes to be EFTA01422421 delivered to the Trustee (directly or through an Intermediary or bailee) on or after the Closing Date and all payments thereon or with respect thereto, (b) each Account (subject, in the case of any Securities Lending Account, to the terms of the applicable Securities Lending Agreement and, in the case of the Hedge Counterparty Collateral Account, to the terms of the applicable Hedge Agreement) and all Eligible Investments purchased with funds on deposit therein, and all income from the investment of funds therein, ING IM CLO 2011-1 EFTA01422422 (c) (d) the Hedge Agreements and all payments thereunder or with respect thereto, the Investment Management Agreement, the Administration Agreement, the Registered Office Agreement and the Collateral Administration Agreement, (e) (f) (g) (h) all Securities Lending Agreements, cash delivered to the Trustee (directly or through an Intermediary or bailee), any ownership interest in a Tax Subsidiary and all proceeds (as defined in the UCC) with respect to the foregoing. Such Grants exclude the Excepted Property. Such Grants are made in trust to secure the Notes equally and ratably without prejudice, priority or distinction between any Note and any other Note by reason of difference of time of issuance or otherwise, except as expressly provided in this Indenture, and to secure, in accordance with the priorities set forth in the Priority of Payments, (A) the payment of all amounts due on the Notes in accordance with their terms, (B) the payment of all other sums payable under this Indenture to any Secured Party and (C) compliance with the provisions of this Indenture, all as provided in this Indenture (collectively, the "Secured Obligations"). II. The Trustee acknowledges such Grants, accepts the trusts hereunder in accordance with the provisions hereof and agrees to hold the Collateral in trust as provided herein. ARTICLE I DEFINITIONS Section 1.1. Definitions. Except as otherwise specified herein or as the context may otherwise require, the following terms have the respective meanings set forth below for all purposes of this Indenture, and the definitions of such terms are equally applicable both to the singular and plural forms of such terms and to the masculine, feminine and neuter genders of such terms. Whenever any reference is made to an amount the determination of which is governed by Section 1.2, the provisions of Section 1.2 shall be applicable to such determination or calculation, unless some other method of calculation or determination is expressly specified in the particular provision. EFTA01422423 "Accelerated Amounts": The meaning specified in Section 5.2(a). "Account": Any of the Interest Collection Account, the Principal Collection Account, the Payment Account, the Expense Reserve Account, the Custodial Account, any Securities Lending Account, the Credit Facility Reserve Account, the Uninvested Proceeds Account, the Pre-Funded Letter of Credit Reserve Account or the Hedge Counterparty Collateral Account. "Account Agreement": An agreement in substantially the form of Exhibit D hereto. ING IM CLO 2011-1 2 EFTA01422424 "Accredited Investor": The meaning specified in Rule 501(a) under Regulation D under the Securities Act. "Act": The meaning specified in Section 14.2. "Additional Equity Issuance": The meaning specified in Section 2.12(b). "Additional Securities": Any notes, combination securities or preferred shares issued in accordance with Section 2.12. "Additional Co-Issued Securities": Any Additional Securities that are Co- Issued Securities. "Additional Securities Closing Date": The closing date for the issuance of any Additional Securities pursuant to Section 2.12 as set forth in a supplemental indenture pursuant to Article VIII. "Administration Agreement": The Administration Agreement between the Administrator and the Issuer, as amended from time to time in accordance with its terms. "Administrative Expenses": Amounts (including indemnification payments) due or accrued with respect to any Distribution Date and payable by the Issuer or the Co-Issuer pursuant to this Indenture and the Fiscal Agency Agreement and the documents delivered pursuant to or in connection with this Indenture, the Fiscal Agency Agreement, the Securities and the Preferred Shares, in the following order of priority: to (a)(i) the Trustee pursuant to Section 6.8; then (ii) the Bank in all its capacities, including as Collateral Administrator and Fiscal Agent; then (iii) the Administrator under the Administration Agreement; and then (iv) each Rating Agency for fees and expenses in connection with any rating of the Securities and the Collateral Obligations (including fees related to surveillance, credit estimates and monitoring of ratings), and then, (b) in the order of priority determined by the Investment Manager; to (i) the Independent accountants, agents and counsel of the Issuer for fees and expenses; (ii) the Investment Manager for expenses and other payments under this Indenture and the Investment Management Agreement; (iii) any Person in respect of any fees or expenses in connection with any application for listing of any Securities or any withdrawal of any such application; (iv) any Person in respect of any governmental fee, charge or tax (including any FATCA Compliance Costs); (v) any Person in respect of expenses or other amounts payable by the Issuer in EFTA01422425 connection with a Securities Lending Agreement; (vi) any unpaid expenses related to a Refinancing; (vii) any amounts reserved for expenses in connection with an Optional Redemption or the discharge of this Indenture; (viii) any fees of any registered agent or corporate services supplier; (ix) any expenses related to a Tax Subsidiary; (x) any reserve established for Dissolution Expenses in connection with a redemption, discharge of this Indenture or following an Event of Default and (xi) any Person in respect of any other fees, expenses, or other payments; provided that Administrative Expenses shall not include any Investment Management Fee or any amount due under any Hedge Agreement. "Administrative Expense Senior Cap": With respect to any Distribution Date the sum of (i) 0.005625% of the Portfolio Principal Balance as of the first day of the Due Period immediately preceding such Distribution Date (or, with respect to the first Distribution Date, 3 ING IM CLO 2011-1 EFTA01422426 0.01125% of the Portfolio Principal Balance as of the first day of the Due Period immediately preceding such Distribution Date) and (ii) $175,000 during the 12 month period ending on the Determination Date (or, if shorter, the period beginning on the Closing Date and ending on the Determination Date) or, with respect to this clause (ii), if an Event of Default has occurred and is continuing, such higher amount as may be agreed between the Trustee and the Controlling Party. "Administrator": MaplesFS Limited, or any successor administrator with respect to the Issuer. "Advisers Act": The United States Investment Advisers Act of 1940, as amended. "Affected Class": Any Class of Rated Notes that, as a result of the occurrence of a Tax Event, has received or will receive less than the aggregate amount of principal and interest that would otherwise have been payable to such Class on the Distribution Date related to the Due Period in which such Tax Event occurs. "Affiliate" or "Affiliated": With respect to a Person, (i) any other Person who, directly or indirectly, is in control of, controlled by, or under common control with, such Person or (ii) any other Person who is a director, Officer or employee of (a) such Person, or (b) any such other Person described in clause (i) above. For the purposes of this definition, control of a Person shall mean the power, direct or indirect, (x) to vote more than 50% of the securities having ordinary voting power for the election of directors of such Person, or (y) to direct or cause the direction of the management and policies of such Person whether by contract or otherwise. Notwithstanding the foregoing, neither of the Co-Issuers shall be deemed to be an Affiliate of (A) the other; (B) the Investment Manager or any of its Affiliates solely by reason of the Investment Management Agreement; or (C) the Administrator or the Share Trustee or any other special purpose vehicle controlled by either of them solely by reason of this Indenture or services provided in respect of any transaction contemplated hereby, and the Investment Manager and its Affiliates shall not be treated as an Affiliate of any account or fund (or any directors thereof) solely as a result of investment services provided to such account or fund. "Agent": Each of the Trustee, the initial Paying Agents, the Calculation Agent, the EFTA01422427 Authenticating Agent, the Transfer Agent, the Indenture Registrar and any additional Paying Agent appointed pursuant to this Indenture. "Agent Member": Members of or participants in a Depository. "Aggregate Industry Equivalent Unit Score": With respect to each Moody's Industry Classification Group, the sum of the Issuer Scores for each issuer of a Pledged Collateral Obligation (other than a Defaulted Obligation) in such Moody's Industry Classification Group. "Aggregate Outstanding Amount": With respect to any (i) Rated Notes, the aggregate principal amount of such Outstanding Notes (including any Deferred Interest previously added to the principal amount of such Notes and which remains unpaid); (ii) Subordinated Notes, the initial aggregate principal amount of such Outstanding Subordinated Notes; and (iii) Preferred Shares, the notional amount represented by such Outstanding Preferred Shares, assuming a notional amount of $1,000 per share. ING IM CLO 2011-1 4 EFTA01422428 "Aggregate Principal Balance": When used with respect to any Pledged Obligations, the sum of the Principal Balances of all such Pledged Obligations on the date of determination. "Applicable Break-Even Default Rate": At any time, the break-even default rate that the Current Portfolio or the Proposed Portfolio, as applicable, can sustain that, after giving effect to the S&P assumptions on recoveries, interest rates and timing of defaults and recoveries and to the Priority of Payments, will correspond to the break-even percentile for the rating confirmed on the Effective Date by S&P to the applicable Class of Notes. "Applicable Default Differential": At any time, the rate calculated by subtracting the Applicable Scenario Default Rate at such time from the Applicable Break-Even Default Rate at such time. "Applicable Issuer": With respect to (a) the Co-Issued Securities, the Co- Issuers and (b) the Issuer Only Notes, the Issuer. "Applicable Legend": With respect to any Class of Securities, the legend set forth in Exhibits A-1 through A-6, as applicable. "Applicable Notes": The Classes of Notes specified in the definition of the applicable Overcollateralization Test, Interest Coverage Test or as the context otherwise requires. "Applicable Scenario Default Rate": At any time, an estimate of the cumulative default rate for the Current Portfolio or the Proposed Portfolio, as applicable, consistent with the rating assigned on the Closing Date by S&P to the applicable Class of Notes, determined by application of the S&P CDO Monitor. "Appreciated Criteria": Criteria that are satisfied with respect to any Collateral Obligation if any of the following is satisfied: on any date of determination, (a) the positive difference between its market price (expressed as a percentage of par value) on such date and its purchase price is greater than 1.0%; or (b) the percentage change in its market price during the period from the date on which it was acquired by the Issuer to the date of determination either is more positive, or less negative, as the case may be, than the percentage change in an Eligible Loan Index over the same period by 0.25%; or (c) the percentage change in its market price during the period from the date on which it was acquired by the Issuer to the date of EFTA01422429 determination either is more positive, or less negative, as the case may be, than the percentage change in a nationally recognized loan index (other than an Eligible Loan Index) over the same period by 0.50%; or (d) it has been placed under review for upgrade or has been upgraded by Moody's or it has been upgraded or placed by S&P on a credit watch list with potential of developing positive credit implications or improvement in its rating; or (e) the Controlling Party has consented to its treatment as an Appreciated Obligation. "Appreciated Obligation": Any Collateral Obligation that (a) in the Investment Manager's reasonable business judgment, has improved in credit quality since its acquisition by the Issuer; and (b) if the Restricted Trading Condition applies, satisfies at least one of the Appreciated Criteria. 5 ING IM CLO 2011-1 EFTA01422430 "Assumed Reinvestment Rate": With respect to any Account or fund securing the Notes, the greater of (i) 0.00% and (ii) LIBOR minus 0.25% per annum. "Authenticating Agent": With respect to the Securities, the Person designated by the Trustee to authenticate such Securities on behalf of the Trustee pursuant to Section 6.4 hereof. "Authorized Denomination": A minimum denomination (based on the initial principal amount) set forth on the table below and integral multiples of U.S.$1.00 in excess thereof: Class Regulation S Sales (U.S.$) Class A Notes Class B Notes Class C Notes Class D Notes Subordinated Notes* 500,000 500,000 250,000 250,000 250,000 Rule 144A Sales (U.S.$) 500,000 500,000 250,000 250,000 250,000 * The Authorized Denomination for sales to Accredited Investors shall be $250,000 and integral multiples of $1.00 in excess thereof. "Authorized Officer": With respect to either of the Co-Issuers, any Officer who is authorized to act for it in matters relating to, and binding upon, it or, in respect of particular matters for which the Investment Manager has authority to act on behalf of the Issuer and in respect of which matters the Investment Manager has determined to act on behalf of the Issuer, any Officer, employee or agent of the Investment Manager who is authorized to act for the Investment Manager. With respect to the Investment Manager, any Officer, employee or agent of the Investment Manager who is authorized to act for the Investment Manager in matters relating to, and binding upon, the Investment Manager with respect to the subject matter of the request, certificate or order in question. With respect to the Trustee or EFTA01422431 any other bank or trust company acting as trustee of an express trust or as custodian, a Trust Officer. Each party may receive and accept a certification of the authority of any other party as conclusive evidence of the authority of any Person to act, and such certification may be considered as in full force and effect until receipt by such other party of written notice to the contrary. "Average Par Amount": With respect to the Diversity Score for the Pledged Collateral Obligations, at any time, an amount equal to the aggregate Issuer Par Amounts divided by the number of Industry Issuers; provided that, for purposes of calculating the Average Par Amount, any Affiliated Industry Issuers will be considered one Industry Issuer. "Balance": On any date, with respect to Eligible Investments in any account, the aggregate of the (a) current balance of cash, demand deposits, time deposits, certificates of deposit and federal funds; (b) principal amounts of (i) interest-bearing corporate securities, government securities and commercial paper, (ii) money market accounts, (iii) repurchase obligations and (iv) Reinvestment Agreements; and (c) purchase price (but not greater than the face amount) of non-interest-bearing corporate securities, government securities and commercial paper. ING IM CLO 2011-1 6 EFTA01422432 "Bank": The Bank of New York Mellon Trust Company, National Association, a limited purpose national banking association with trust powers organized under the laws of the United States (or successor thereto as Trustee under this Indenture), in its individual capacity, and not as Trustee. "Bankruptcy Code": The United States bankruptcy code, as set forth in Title 11 of the United States Code §§101 et seq., as amended. "Benefit Plan Investor": Any of (a) an employee benefit plan (as defined in Section 3(3) of ERISA) subject to Title I of ERISA, (b) a plan described in Section 4975(e)(1) of the Code to which Section 4975 of the Code applies or (c) any other entity whose underlying assets could be deemed to include plan assets by reason of an employee benefit plan's or a plan's investment in the entity within the meaning of the Plan Asset Regulation or otherwise. "Board of Directors": With respect to the Issuer, the board of directors of the Issuer duly appointed by the shareholders of the Issuer or otherwise duly appointed from time to time and, with respect to the Co-Issuer, the manager and member of the Co-Issuer; provided, that with respect to the Issuer there will at all times be at least one director and with respect to the Colssuer at least one manager who is not Affiliated with the Investment Manager. "Board Resolution": With respect to either of the Co-Issuers, a resolution of its Board of Directors (or, as applicable, the minutes of the meeting recording such resolution). "Bridge Loan": Any Loan or other obligation that (i) is incurred in connection with a merger, acquisition, consolidation, sale of all or substantially all of the assets of a Person, restructuring, recapitalization or similar transaction, (ii) by its terms, is required to be repaid within one year of the incurrence thereof with proceeds from additional borrowings or other refinancings (other than any additional borrowing or refinancing for which one or more financial institutions have provided the underlying obligor of such debt obligation with a binding written commitment to provide the same), and (iii) has a rating by Moody's and S&P. "Business Day": A day on which commercial banks and foreign exchange markets settle payments in New York, New York and any other city in which the Corporate Trust Office of the Trustee is located (which initially will be Houston, Texas); with respect to any payment to be EFTA01422433 made by a Paying Agent, the city in which such Paying Agent is located; and, with respect to the final payment on any Security, the place of presentation and surrender of such Security. "Caa Collateral Obligation": Any Collateral Obligation other than a Defaulted Obligation with a Moody's Obligation Rating of "Caal" or lower. "Caa Excess Amount": The aggregate principal balance of Caa Collateral Obligations in excess of 7.5% of the Portfolio Principal Balance. "Caa/CCC Collateral Obligation": Any Collateral Obligation that is a Caa Collateral Obligation or a CCC Collateral Obligation. "Caa/CCC Excess": The greater of the Caa Excess Amount and the CCC Excess Amount. 7 ING IM CLO 2011-1 EFTA01422434 "Caa/CCC Excess Market Value": (a) If the Caa Excess Amount is greater than the CCC Excess Amount, the aggregate Market Value of Caa Collateral Obligations, or, in the case of Caa Obligations that are Discount Obligations, the lesser of their purchase price and Market Value (in order of ascending Market Value or purchase price, as the case may be, starting with the Caa Collateral Obligation with the lowest such value) with an aggregate principal balance equal to the Caa Excess Amount; and (b) if the CCC Excess Amount is greater than the Caa Excess Amount, the aggregate Market Value of the CCC Collateral Obligations (in order of ascending Market Value, starting with the CCC Collateral Obligation with the lowest Market Value) with an aggregate principal balance equal to the CCC Excess Amount "Calculation Agent": The meaning specified in Section 7.15. "CCC Collateral Obligation": Any Collateral Obligation other than a Defaulted Obligation with an S&P Rating of "CCC+" or lower. "CCC Excess Amount": The aggregate principal balance of CCC Collateral Obligations in excess of 7.5% of the Portfolio Principal Balance. "Certificate of Authentication": The meaning specified in Section 2.3(f). "Certificated Security": The meaning specified in Article 8 of the UCC. "Certifying Person": Any Person that certifies that it is the owner of a beneficial interest in a Global Security (a) substantially in the form of Exhibit C or, (b) with respect to an Act of Holders or exercise of Voting Rights, including any amendment pursuant to Section 8.2, in the form required by the applicable consent form. "Class": All of (a) the Notes having the same Interest Rate, Stated Maturity and designation pursuant to Section 2.2; and (b) the Preferred Shares. With respect to any Vote, (x) any Subordinated Securities that are entitled to Vote on a matter will Vote together as a single class, and (y) any Class A Notes that are entitled to Vote on a matter will Vote together as a single class except as specified herein. "Class A Coverage Tests": Together, the Class A Overcollateralization Test and the Class A Interest Coverage Test. "Class A Interest Coverage Test": A test satisfied as of any Measurement Date if the Interest Coverage Ratio calculated for the Class A Notes as the Applicable Notes is at least (a) 100.0% on or before the Determination Date related to the first Distribution Date and (b) 120.0% thereafter. EFTA01422435 "Class A Note": Each Class A-1Note and Class A-2 Note. "Class A Overcollateralization Test": A test satisfied as of any Measurement Date if the Overcollateralization Ratio calculated for the Class A Notes as the Applicable Notes is at least 124.7 %. ING IM CLO 2011-1 8 EFTA01422436 "Class A-1 Note": Each of the Class A-1 Floating Rate Notes Due 2021 issued by the Co-Issuers, authenticated by the Trustee or any Authenticating Agent and designated as a Class A-1 Note pursuant to this Indenture. "Class A-1 Reinvestment Test": A test that is satisfied as of any Measurement Date if the Overcollateralization Ratio calculated for the Class A-1 Notes as the Applicable Notes is at least 115.0%. "Class A-2 Note": Each of the Class A-2 Floating Rate Notes Due 2021 issued by the Co-Issuers, authenticated by the Trustee or any Authenticating Agent and designated as a Class A-2 Note pursuant to this Indenture. "Class B Coverage Tests": Together, the Class B Overcollateralization Test and the Class B Interest Coverage Test. "Class B Interest Coverage Test": A test satisfied as of any Measurement Date if the Interest Coverage Ratio calculated for the Class A Notes and the Class B Notes as the Applicable Notes is at least (a) 100.0% on or before the Determination Date related to the first Distribution Date and (b) 115.0% thereafter. "Class B Note": Each of the Class B Deferrable Floating Rate Notes Due 2021 issued by the Co-Issuers, authenticated by the Trustee or any Authenticating Agent and designated as a Class B Note pursuant to this Indenture. "Class B Overcollateralization Test": A test satisfied as of any Measurement Date if the Overcollateralization Ratio calculated for the Class A Notes and the Class B Notes as the Applicable Notes is at least 113.0%. "Class C Coverage Tests": Together, the Class C Overcollateralization Test and the Class C Interest Coverage Test. "Class C Interest Coverage Test": A test satisfied as of any Measurement Date if the Interest Coverage Ratio calculated for the Senior Notes as the Applicable Notes is at least (a) 100.0% on or before the Determination Date related to the first Distribution Date and (b) 110.0% thereafter. "Class C Note": Each of the Class C Deferrable Floating Rate Notes Due 2021 issued by the Co-Issuers, authenticated by the Trustee or any Authenticating Agent and designated as a Class C Note pursuant to this Indenture. "Class C Overcollateralization Test": A test satisfied as of any Measurement EFTA01422437 Date if the Overcollateralization Ratio calculated for the Senior Notes as the Applicable Notes is at least 107.6%. "Class D Coverage Tests": Together, the Class D Overcollateralization Test and the Class D Interest Coverage Test. 9 ING IM CLO 2011-1 EFTA01422438 "Class D Interest Coverage Test": A test satisfied as of any Measurement Date after the Determination Date related to the first Distribution Date if the Interest Coverage Ratio calculated for the Rated Notes as the Applicable Notes is at least 105.0%. There will be no Class D Interest Coverage Test prior to or on the Determination Date related to the first Distribution Date. "Class D Note": Each of the Class D Deferrable Floating Rate Notes Due 2021 issued by the Issuer, authenticated by the Trustee or any Authenticating Agent and designated as a Class D Note pursuant to this Indenture. "Class D Overcollateralization Test": A test satisfied as of any Measurement Date if the Overcollateralization Ratio calculated for the Rated Notes as the Applicable Notes is at least 104.0%. "Clearing Agency": An organization registered as a "clearing agency" pursuant to Section 17A of the Exchange Act. "Clearing Corporation": Any entity included within the meaning of "clearing corporation" under the UCC. "Clearing Corporation Security": A Collateral Obligation that is a Financial Asset that is registered in the name of a Clearing Corporation or the nominee of such Clearing Corporation and, if a Certificated Security, is in either case held in the custody of such Clearing Corporation. "Clearstream": Clearstream Banking, societe anonyme, or any successor clearing corporation. "Closing Date": June 22, 2011. "Closing Date Interest Deposit": $825,000. "Code": The U.S. Internal Revenue Code of 1986, as amended. "Co-Issued Securities": The Senior Notes. "Co-Issuer": ING IM CLO 2011-1 LLC, a limited liability company existing under the laws of the State of Delaware, until a successor Person shall become the Co- Issuer pursuant to the applicable provisions of this Indenture, and thereafter "Co-Issuer" shall mean such successor Person. "Co-Issuers": The Issuer and the Co-Issuer, together. "Collateral": The meaning specified in Granting Clause I. "Collateral Administration Agreement": The Collateral Administration Agreement dated as of the Closing Date by and among the Issuer, the Investment Manager and the Collateral Administrator, as amended from time to time in accordance with its terms. ING IM CLO 2011-1 EFTA01422439 10 EFTA01422440 "Collateral Administrator": The Bank, solely in its capacity as Collateral Administrator under the Collateral Administration Agreement, until a successor Person shall have become the Collateral Administrator pursuant to the applicable provisions of the Collateral Administration Agreement, and thereafter "Collateral Administrator" shall mean such successor Person. "Collateral Matrix": The meaning specified in Schedule G. "Collateral Obligation": An obligation that: (a) a Senior Secured Note; or (ii) at the time of the Issuer's commitment to purchase is: (i) an assignment of a Senior Secured Loan or Second Lien Loan; or (iii) a Participation in a Senior Secured Loan or Second Lien Loan; and (b) at the time of the Issuer's commitment to purchase: (i) (ii) provides for periodic payments in cash no less frequently than semiannually (provided that it may provide that such periodic payments be deferred and capitalized); is an obligation of (A) an obligor organized in a Recovery Approved Country or (B) an Excepted Company; (iii) provides for payment of a fixed amount of principal in cash or final cash payment by the maturity or scheduled expiration thereof; (iv) the Trustee; (vi) does not require future advances to be made to the obligor in accordance with its Underlying Instrument unless it is a Credit Facility; (v) clause (a) of the definition thereof); (vii) is eligible to be sold, assigned or participated to the Issuer and pledged to is not a Defaulted Obligation or a Credit Risk Obligation (as described in is Registered and has payments (other than commitment and similar fees or Pre-Funded Letter of Credit fees) that are not subject to U.S. or non- U.S. withholding tax unless the obligor thereof is required to make "gross—up" payments that cover the full amount of any such withholding tax; (viii) as to which the Investment Manager has not determined, in its reasonable business judgment, that it is subject to substantial non-credit related risk with respect to repayment; (ix) EFTA01422441 has an S&P Rating and does not have an "f," "p," "pi," "q," "r" or a "t" subscript appended to its long term rating from S&P; 11 ING IM CLO 2011-1 EFTA01422442 (x) (xi) is not a lease other than a Finance Lease; (A) provides for payment in U.S. Dollars and (B) cannot be converted at the option of the obligor thereof to payment in a different currency; (xii) is not an obligation that would cause the Issuer (or the Investment Manager acting on behalf of the Issuer) to be deemed for U.S. federal income tax purposes to have engaged in a primary loan origination; (xiii) is not an obligation that is directly or indirectly secured by Margin Stock or the purchase or holding of which would cause the Issuer or the Trustee to violate applicable U.S. margin regulations; (xiv) does not provide for conversion into or exchange for an Equity Security; (xv) if it is a PIK Security, is not deferring interest payments and, in the reasonable business judgment of the Investment Manager, no deferred interest will be outstanding as of the next scheduled payment distribution date for such obligation; (xvi) has a Moody's Rating and, if it is a Caa Collateral Obligation, has a Moody's Rating that is not lower than "Caa2"; and if it is a CCC Collateral Obligation, has an S&P Rating that is not lower than "CCC"; (xvii) bears interest at a floating rate; (xviii) is not a High Yield Bond; (xix) does not have a stated maturity after the Stated Maturity of the Notes; (xx) is not a Synthetic Security or a Structured Finance Obligation; and (xxi) does not have an interest rate that steps-up or steps-down solely because of the passage of time. "Collateral Quality Test": Each of the Diversity Test, the Weighted Average Rating Factor Test, the Minimum Weighted Average Spread Test, the Weighted Average Recovery Rate Test, the Weighted Average Life Test and, from and after the date on which the Investment Manager and the Collateral Administrator receive from S&P the S&P CDO Monitor, the S&P CDO Monitor Test. "Collection Account": The Interest Collection Account or the Principal Collection Account, as applicable. "Commitment Amount": With respect to any Credit Facility, the sum of the Funded Amount and the maximum aggregate amount of unfunded advances or other extensions of credit, EFTA01422443 or payments of principal amounts, at any one time outstanding that the Issuer could be required to make to the obligor under the Underlying Instruments relating thereto. ING IM CLO 2011-1 12 EFTA01422444 "Concentration Limits": With respect to the Issuer's commitment to purchase Collateral Obligations on or after the Effective Date: (a) the minimum and maximum limitations (and exceptions and additional requirements) listed in the table below: Minimum Collateral Type (i) Senior Secured Loans (assuming for purposes of these calculations that Eligible Principal Investments are Senior Secured Loans) (ii) Senior Secured Notes and Second Lien Loans, collectively (iii) PIK Securities and Partial PIK Securities, collectively (iv) DIP Loans (v) the Commitment Amount of Revolving Credit Facilities and the Unfunded Amount of Delayed Funding Loans, collectively (vi) Participations (vii) Caa/CCC Collateral Obligations (other than Permissible Replacement Collateral Obligations) (viii) obligations that are subject to an Offer or notice of redemption of which the Investment Manager has actual knowledge; provided that any such Offer must include payment of cash in an amount at least equal to the par amount of the Collateral Obligation (ix) obligations of any one obligor (together with affiliated obligors) (x) obligations issued by obligors in any one industry determined by the S&P's CDO Monitor Asset Classifications 5 7.5 5 (% of the Portfolio Principal Balance) 95 5 5 7.5 5 no more than 2.5% in PIK Securities Maximum (% of the EFTA01422445 Portfolio Principal Balance) Exceptions and Additional Requirements 2 8 up to five obligors may each constitute up to 2.5% obligors in any two such industries may each comprise up to 12% 13 ING IM CLO 2011-1 EFTA01422446 Min