Related-party arrangements	9 Months Ended
Sep. 30, 2013
Related-party arrangements	9. Related-party arrangements In October 2007, the Company entered into a $350.0 million revolving loan arrangement with Alfred E. Mann, its principal stockholder. In February 2009, as a result of the Company’s principal stockholder being subject to the licensing requirement under the California Finance Lenders Law, the promissory note underlying the loan arrangement was revised to reflect the lender as The Mann Group. Until January 1, 2013, interest on outstanding principal amounts accrued at a fixed rate equal to the one-year LIBOR as reported by the Wall Street Journal on the date of such advance plus 3% per annum. The promissory note underlying the loan arrangement was amended at various dates during 2012. In October 2012, the promissory note was amended to adjust the annual interest rate on all outstanding principal to the one-year LIBOR on December 31, 2012 plus 5%. As a result of these amendments, effective January 1, 2013, the borrowing rate for all borrowings under the promissory note with The Mann Group was set at 5.84%. On October 31, 2013, the promissory note was further amended to, among other things, extend the maturity date of the loan to January 5, 2020, extend the date through which the Company can borrow under the loan arrangement to December 31, 2019, increase the aggregate borrowing amount under the loan arrangement from $350.0 million to $370.0 million, provide that repayments or cancellations of principal under the loan arrangement will not be available for reborrowing, and to cancel $78.0 million of principal indebtedness under the loan arrangement as payment for the aggregate exercise price of The Mann Group Warrants. Under guidance of ASC 470-10-45, the note payable to related party is excluded from current liabilities due to the amendment on October 31, 2013 and presented as a non-current liability as of September 30, 2013. In addition, the Company and The Mann Group agreed to capitalize into principal $7.9 million of accrued interest that became due and payable upon cancellation of the $78.0 million of principal indebtedness. As such, the Company included the accrued interest at September 30, 2013 in Other liabilities in the accompanying condensed consolidated balance sheet. As of September 30, 2013, the total principal amount outstanding under the loan arrangement was $119.6 million. As of October 31, 2013, the Company had $30.1 million principal amount of available borrowings under the loan arrangement. Interest is due and payable quarterly in arrears on the first day of each calendar quarter for the preceding quarter, or at such other time as the Company and The Mann Group mutually agree. All or any portion of accrued and unpaid interest that becomes due and payable may be paid-in-kind and capitalized at any time upon mutual agreement of both parties. The Mann Group can require the Company to prepay up to $200.0 million in advances that have been outstanding for at least 12 months (less approximately $105.0 million aggregate principal amount that was cancelled in connection with two common stock purchase agreements – a Common Stock Purchase Agreement between the Company and The Mann Group dated August 2010 and the Mann Group Common Stock Purchase Agreement - and subject to the subordination agreement entered into by The Man Group with Deerfield). If The Mann Group exercises this right, the Company will have 90 days after The Mann Group provides written notice (or the number of days to maturity of the note if less than 90 days) to prepay such advances. In the event of a default, all unpaid principal and interest either becomes immediately due and payable or may be accelerated at The Mann Group’s option, and the interest rate will increase to the one-year LIBOR calculated on the date of the initial advance or in effect on the date of default, whichever is greater, plus 5% per annum. All borrowings under the loan arrangement are unsecured. The loan arrangement contains no financial covenants. There are no warrants associated with the loan arrangement. In connection with the Facility Agreement with Deerfield, The Mann Group entered into a subordination agreement with Deerfield, pursuant to which it agreed to subordinate its right to payments under the loan arrangement and not accept repayment until the 2019 notes have been repaid in full. In February 2012, concurrently with an underwritten public offering (see Note 7 — Common and preferred stock), pursuant to The Mann Group Common Stock Purchase Agreement, The Mann Group agreed to purchase $77.2 million worth of restricted shares or 31,250,000 restricted shares of common stock, which were issued in June 2012 in exchange for cancellation of $77.2 million of principal indebtedness under the revolving loan arrangement. In October 2012, concurrently with an underwritten public offering (see Note 7 — Common and preferred stock), pursuant to The Mann Group Common Stock and Warrant Purchase Agreement, The Mann Group agreed to purchase, for an aggregate purchase price of $107.4 million, 40,000,000 restricted shares of common stock and warrants to purchase 30,000,000 restricted shares of common stock, which were issued in December 2012 in exchange for cancellation of principal indebtedness of $107.4 million under the revolving loan arrangement. Additionally, in accordance with the terms of the loan arrangement, the Company elected to capitalize the accrued and unpaid interest on the cancelled principal amount that became due upon the closing (see Note 7 – Common and preferred stock). During the first, second, and third quarters of 2013, there were no borrowings under or amendments to The Mann Group loan arrangement. The Mann Group exercised the warrants at a price of $2.60 per share in October 2013 in exchange for the cancellation of $78.0 million of principal indebtedness under the Company’s loan arrangement with The Mann Group. The restricted shares sold to The Mann Group in both the June and December 2012 transactions, and the restricted shares issued to The Mann Group upon the exercise of The Mann Group Warrants in October 2013, may not be sold, pledged, assigned or transferred unless (i) the shares have been registered with the Securities and Exchange Commission (“SEC”) or (ii) the restricted shares are exempt from SEC registration requirements and the Company has obtained an opinion from the Company’s counsel that the shares may be sold lawfully without registration.

9. Related-party arrangements

In October 2007, the Company entered into a $350.0 million revolving loan arrangement with Alfred E. Mann, its principal stockholder. In February 2009, as a result of the Company’s principal stockholder being subject to the licensing requirement under the California Finance Lenders Law, the promissory note underlying the loan arrangement was revised to reflect the lender as The Mann Group. Until January 1, 2013, interest on outstanding principal amounts accrued at a fixed rate equal to the one-year LIBOR as reported by the Wall Street Journal on the date of such advance plus 3% per annum. The promissory note underlying the loan arrangement was amended at various dates during 2012. In October 2012, the promissory note was amended to adjust the annual interest rate on all outstanding principal to the one-year LIBOR on December 31, 2012 plus 5%. As a result of these amendments, effective January 1, 2013, the borrowing rate for all borrowings under the promissory note with The Mann Group was set at 5.84%. On October 31, 2013, the promissory note was further amended to, among other things, extend the maturity date of the loan to January 5, 2020, extend the date through which the Company can borrow under the loan arrangement to December 31, 2019, increase the aggregate borrowing amount under the loan arrangement from $350.0 million to $370.0 million, provide that repayments or cancellations of principal under the loan arrangement will not be available for reborrowing, and to cancel $78.0 million of principal indebtedness under the loan arrangement as payment for the aggregate exercise price of The Mann Group Warrants. Under guidance of ASC 470-10-45, the note payable to related party is excluded from current liabilities due to the amendment on October 31, 2013 and presented as a non-current liability as of September 30, 2013. In addition, the Company and The Mann Group agreed to capitalize into principal $7.9 million of accrued interest that became due and payable upon cancellation of the $78.0 million of principal indebtedness. As such, the Company included the accrued interest at September 30, 2013 in Other liabilities in the accompanying condensed consolidated balance sheet.

As of September 30, 2013, the total principal amount outstanding under the loan arrangement was $119.6 million. As of October 31, 2013, the Company had $30.1 million principal amount of available borrowings under the loan arrangement. Interest is due and payable quarterly in arrears on the first day of each calendar quarter for the preceding quarter, or at such other time as the Company and The Mann Group mutually agree. All or any portion of accrued and unpaid interest that becomes due and payable may be paid-in-kind and capitalized at any time upon mutual agreement of both parties. The Mann Group can require the Company to prepay up to $200.0 million in advances that have been outstanding for at least 12 months (less approximately $105.0 million aggregate principal amount that was cancelled in connection with two common stock purchase agreements – a Common Stock Purchase Agreement between the Company and The Mann Group dated August 2010 and the Mann Group Common Stock Purchase Agreement - and subject to the subordination agreement entered into by The Man Group with Deerfield). If The Mann Group exercises this right, the Company will have 90 days after The Mann Group provides written notice (or the number of days to maturity of the note if less than 90 days) to prepay such advances.

In the event of a default, all unpaid principal and interest either becomes immediately due and payable or may be accelerated at The Mann Group’s option, and the interest rate will increase to the one-year LIBOR calculated on the date of the initial advance or in effect on the date of default, whichever is greater, plus 5% per annum. All borrowings under the loan arrangement are unsecured. The loan arrangement contains no financial covenants. There are no warrants associated with the loan arrangement. In connection with the Facility Agreement with Deerfield, The Mann Group entered into a subordination agreement with Deerfield, pursuant to which it agreed to subordinate its right to payments under the loan arrangement and not accept repayment until the 2019 notes have been repaid in full.

In February 2012, concurrently with an underwritten public offering (see Note 7 — Common and preferred stock), pursuant to The Mann Group Common Stock Purchase Agreement, The Mann Group agreed to purchase $77.2 million worth of restricted shares or 31,250,000 restricted shares of common stock, which were issued in June 2012 in exchange for cancellation of $77.2 million of principal indebtedness under the revolving loan arrangement.

In October 2012, concurrently with an underwritten public offering (see Note 7 — Common and preferred stock), pursuant to The Mann Group Common Stock and Warrant Purchase Agreement, The Mann Group agreed to purchase, for an aggregate purchase price of $107.4 million, 40,000,000 restricted shares of common stock and warrants to purchase 30,000,000 restricted shares of common stock, which were issued in December 2012 in exchange for cancellation of principal indebtedness of $107.4 million under the revolving loan arrangement. Additionally, in accordance with the terms of the loan arrangement, the Company elected to capitalize the accrued and unpaid interest on the cancelled principal amount that became due upon the closing (see Note 7 – Common and preferred stock). During the first, second, and third quarters of 2013, there were no borrowings under or amendments to The Mann Group loan arrangement. The Mann Group exercised the warrants at a price of $2.60 per share in October 2013 in exchange for the cancellation of $78.0 million of principal indebtedness under the Company’s loan arrangement with The Mann Group.

The restricted shares sold to The Mann Group in both the June and December 2012 transactions, and the restricted shares issued to The Mann Group upon the exercise of The Mann Group Warrants in October 2013, may not be sold, pledged, assigned or transferred unless (i) the shares have been registered with the Securities and Exchange Commission (“SEC”) or (ii) the restricted shares are exempt from SEC registration requirements and the Company has obtained an opinion from the Company’s counsel that the shares may be sold lawfully without registration.