SECOND AMENDED AND RESTATED LOAN AGREEMENT

Exhibit 10.8

EXECUTION COPY

 

SECOND AMENDED AND RESTATED LOAN AGREEMENT

By and Among

GENERAL MOTORS OF CANADA LIMITED,

as Borrower,

and

THE OTHER LOAN PARTIES

and

EXPORT DEVELOPMENT CANADA,

as Lender

Dated as of July 10, 2009

 

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SECOND AMENDED AND RESTATED LOAN AGREEMENT

SECOND AMENDED AND RESTATED LOAN AGREEMENT, dated as of July 10, 2009, among GENERAL MOTORS OF CANADA LIMITED, a corporation established pursuant to the laws of Canada (the “ Borrower ”), the other Loan Parties (as hereinafter defined) and EXPORT DEVELOPMENT CANADA, a corporation established pursuant to the laws of Canada (the “ Lender ”).

RECITALS

A. The Borrower and the Lender entered into a Loan Agreement dated as of April 29th, 2009 which was amended and restated pursuant to an Amended and Restated Loan Agreement dated June 1, 2009 (collectively the “ Existing Loan Agreement ”).

B. Pursuant to the Existing Loan Agreement, the Lender made advances to the Borrower in a principal amount of the Canadian Dollar Equivalent of US$2,413,000,000 (the “ Existing Loan Agreement Advances ”).

C. Concurrently herewith, the Lender has entered into an Assignment Agreement with 7176384 Canada Inc. (the “ Existing Loan Assignee ”) pursuant to which the Lender assigned to the Existing Loan Assignee a portion of the Existing Loan Agreement Advances, leaving a balance of the Existing Loan Agreement Advances in the principal amount of the Canadian Dollar Equivalent of US$1,288,135,593 (the “ Remaining Existing Loan Agreement Advances ”).

D. The Borrower and the Lender wish to amend and restate the Existing Loan Agreement to deal with the terms and conditions of the Remaining Existing Loan Agreement Advances as set forth in this Loan Agreement.

Accordingly, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

SECTION 1. DEFINITIONS AND ACCOUNTING MATTERS .

1.01 Certain Defined Terms . As used herein, the following terms shall have the following meanings (all terms defined in this Section 1.01 or in other provisions of this Loan Agreement in the singular to have the same meanings when used in the plural and vice versa):

“ 1908 Holdings ” shall mean 1908 Holdings Ltd., a Subsidiary of the Borrower.

“ Additional First Lien Indebtedness ” shall mean, as at any date of determination, principal amount of Indebtedness (other than (i) Indebtedness under the US Credit Agreement and the VEBA Note Facility and (ii) Indebtedness described in clauses (a) through (m) (inclusive) and clause (p) of the definition of “ Permitted Indebtedness ”) in excess of US$6,000,000,000 secured on a first priority basis by the Collateral or the US Collateral or any portion of either of the foregoing (including without limitation Structured Financing), provided that, (i) on the date such Indebtedness is incurred, the Consolidated Leverage Ratio shall be less than 3.00 to 1.00 after giving pro forma effect to the incurrence of such Indebtedness, (ii) a portion of the Net Cash Proceeds of such Indebtedness (other than revolving credit loans) are used to prepay the Loan in accordance with Section2.07(a), (iii) the aggregate amount of

 

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commitments under revolving credit facilities, if any, together with any revolving credit facilities constituting Excluded First Lien Indebtedness, shall not exceed US$4,000,000,000, (iv) with respect to any revolving credit facility, the amount of Indebtedness thereunder for the purpose of determining compliance with clauses (i) and (iii) of this definition shall be equal to the related commitment thereunder and (v) the lenders party thereto (or an agent on behalf of such lenders) shall have executed and delivered an intercreditor agreement in form and substance reasonably satisfactory to the Lender solely to the extent the loan parties to such Indebtedness are one or more of the Loan Parties.

“ Advances ” shall mean, collectively, all advances of the Loan made by the Lender to the Borrower.

“ Affiliate ” shall mean, with respect to any Person, any other Person which, directly or indirectly, controls, is controlled by, or is under common control with, such Person, provided that, references to Affiliates of the Lender shall be deemed to include, without limitation, Her Majesty the Queen in Right of Canada and Her Majesty the Queen in Right of the Province of Ontario. For purposes of this Loan Agreement, “control” (together with the correlative meanings of “controlled by” and “under common control with”) means possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by contract, or otherwise. For the avoidance of doubt, pension plans of a Person and entities holdings the assets of such plans, shall not be deemed to be Affiliates of such Person. Notwithstanding the foregoing, none of (i) the Government of the United States (or any branch or agency thereof), (ii) the Government of Canada (or any branch or agency thereof), (iii) the Government of Ontario (or any branch or agency thereof), or (iv) the VEBA or the UAW, shall be considered an Affiliate of the Borrower, the US Borrower or any of their Subsidiaries.

“ AML Legislation ” shall have the meaning set forth in Section 12.26 hereof.

“ Applicable Law ” shall mean, with reference to any Person, all laws (including common law), statutes, regulations, ordinances, treaties, judgments, decrees, injunctions, writs and orders of any court, governmental agency or authority and rules, regulations, orders, directives, licenses and permits of any Governmental Authority applicable to such Person or its property or in respect of its operations.

“ Applicable Net Cash Proceeds ” shall mean with respect to any Additional First Lien Indebtedness, Permitted Unsecured Indebtedness or Attributable Obligations under each applicable Sale/Leaseback Transaction, an amount equal to 16.102% of 50% of the Net Cash Proceeds of such Indebtedness or Attributable Obligations, as applicable.

“ Applicable Rejected Prepayment Amount ” shall mean, on any date of determination:

(a) with respect to any Treasury Rejection Notice, an amount equal to (i) the amount of the mandatory prepayment rejected by the Treasury pursuant to Section 2.5(g) of the US Credit Agreement multiplied by (ii) a percentage equal to (x) the aggregate outstanding principal balance of the Loan held by EDC on such date divided by (y) the sum of the aggregate outstanding amount of the Loan held by EDC on such date and the aggregate Outstanding Principal (as defined in the VEBA Note Facility) of the VEBA Note Facility held by VEBA on such date; and

 

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(b) with respect to any VEBA Rejection Notice, an amount equal to (i) the amount of the mandatory prepayment rejected by the VEBA pursuant to Section 2.5(g) of the VEBA Note Facility multiplied by (ii) a percentage equal to (x) the aggregate outstanding principal balance of the Loan held by EDC on such date divided by (y) the sum of the aggregate outstanding principal balance of the Loan held by EDC on such date and the aggregate outstanding principal balance of the loans held by Treasury under the US Credit Agreement on such date.

“ Asset Sale ” shall mean any Disposition of property or series of related Dispositions of property occurring contemporaneously (other than any Excluded Disposition) that yields gross proceeds to the Borrower or any Subsidiary Guarantor (valued at the initial principal amount thereof in the case of non cash proceeds consisting of notes or other debt securities and valued at fair market value in the case of other non cash proceeds) in excess of CDN$10,000,000. The term “ Asset Sale ” shall not include any issuance of Equity Interests or any event that constitutes a Recovery Event.

“ Assignee ” has the meaning set forth in Section 12.15(b).

“ Attributable Obligations ” shall mean in respect of a Sale/Leaseback Transaction, as at the time of determination, the present value (discounted at the interest rate implicit in the transaction) of the total obligations of the lessee for rental payments required to be paid during the remaining term of the lease included in such Sale/Leaseback Transaction (including any period for which such lease has been extended), determined in accordance with GAAP; provided, however, that if such Sale/Leaseback Transaction results in a Capital Lease Obligation, the amount of Indebtedness represented thereby shall be determined in accordance with the definition of “ Capital Lease Obligations .” For the purposes of calculating the Consolidated Leverage Ratio, the aggregate amount of Attributable Obligations outstanding as of any date of determination shall be (i) US$500,000,000 plus (ii) the amount of the Attributable Obligations entered into after the Effective Date.

“ Bankruptcy Code ” shall mean the United States Bankruptcy Code, 11 U.S.C. Section 101 et seq.

“ Bankruptcy Court ” shall mean the United States Bankruptcy Court for the Southern District of New York (together with the District Court for the Southern District of New York, where applicable).

“ BIA ” shall mean the Bankcruptcy and lnsolvency Act (Canada).

“ Borrower ” shall mean General Motors of Canada Limited, a Canada corporation, and its permitted successors and assigns.

“ Budget ” shall mean the budget delivered by the US Borrower under the US Credit Agreement.

 

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“ Business Day ” shall mean any day other than (i) a Saturday or Sunday, (ii) a statutory holiday or other day on which banks in Ottawa, Ontario, Canada are permitted to close, or (iii) a day on which trading in securities on the Toronto Stock Exchange or any other major securities exchange in Canada is not conducted.

“ Business Plan ” shall have the meaning set forth in the US Credit Agreement.

“ Canadian Benefit Plans ” shall mean all material employee benefit plans maintained or contributed to by the Borrower for its employees or former employees employed in Canada that are not Canadian Pension Plans including, without limitation, all profit sharing, savings, post-retirement, supplemental retirement, retiring allowance, severance, pension, deferred compensation, welfare, bonus, incentive compensation, phantom stock, legal services, supplementary unemployment benefit plans or arrangements and all life, health, dental and disability plans and arrangements in which the employees or former employees of the Borrower employed in Canada participate or are eligible to participate, provided that no statutory plans to which the Borrower are obligated to contribute, or with respect to which they must comply, including the Canada Pension Plan, the Quebec Pension Plan or plans administered pursuant to applicable federal or provincial health, workers compensation and employment insurance shall be included as Canadian Benefit Plans.

“ Canadian Dollars ” or “ CDN$ ” shall mean the lawful currency of Canada.

“ Canadian Dollar Equivalent ” shall mean, on any date of determination, with respect to any amounts denominated in United States Dollars, the equivalent in Canadian Dollars of such amount as determined by the Lender in accordance with normal banking industry practice using the Exchange Rate.

“ Canadian Entity ” shall mean the Lender, the Province of Ontario, the Federal Government of Canada, and any of their respective agencies, instrumentalities and departments or any corporation or other Person controlled by one or more of the foregoing.

“ Canadian Pension Plans ” shall mean a “ registered pension plan ” as defined in the Income Tax Act (Canada) established, maintained or contributed to by the Borrower for its employees or former employees employed in Canada.

“ Canadian Subscription Agreement ” means that certain Canada Contribution & Subscription Agreement between the US Borrower and 7176384 Canada Inc. dated as of July 10, 2009.

“ Canadian Subsidiary ” shall mean any Subsidiary of the Borrower organized under the laws of Canada or any province or territory thereof.

“ Capital Lease Obligations ” shall mean for any Person, all obligations of such Person to pay rent or other amounts under a lease of (or other agreement conveying the right to use) Property to the extent such obligations are required to be classified and accounted for as a capital lease on a balance sheet of such Person under GAAP, and, for purposes of this Loan Agreement, the amount of such obligations shall be the capitalized amount thereof, determined in accordance with GAAP.

 

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“ Cases ” shall have the meaning set forth in the US Credit Agreement.

“ Cash Equivalents ” shall mean (a) United States Dollars, Canadian Dollars or money in other currencies received in the ordinary course of business, (b) securities with maturities of one year or less from the date of acquisition issued or fully guaranteed or insured by the United States or Canadian government or any agency thereof, (c) securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, province, commonwealth or territory of the United States or Canada, by any political subdivision or taxing authority of any such state, province, commonwealth or territory or by any foreign government, the securities of which state, province, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at least “A” by S&P or “A” by Moody’s or equivalent rating; (d) demand deposit, certificates of deposit and time deposits with maturities of one year or less from the date of acquisition and overnight bank deposits of any commercial bank, supranational bank or trust company having a credit rating of “F-1” or higher by Fitch (or the equivalent rating by S&P or Moody’s), (e) repurchase obligations with respect to securities of the types (but not necessarily maturity) described in clauses (b) and (c) above, having a term of not more than 90 days, of banks (or bank holding companies) or subsidiaries of such banks (or bank holding companies) and non bank broker-dealers listed on the Federal Reserve Bank of New York’s list of primary and other reporting dealers (“ Repo Counterparties ”), which Repo Counterparties have a credit rating of at least “F-1” or higher by Fitch (or the equivalent rating by S&P or Moody’s), (f) commercial paper rated at least A-1 or the equivalent thereof by S&P or P-1 or the equivalent thereof by Moody’s and in either case maturing within one year after the day of acquisition, (g) short-term marketable securities of comparable credit quality, (h) shares of money market mutual or similar funds which invest at least 95% in assets satisfying the requirements of clauses (a) through (g) of this definition (except that such assets may have maturities of 13 months or less), and (i) in the case of a Foreign Subsidiary, substantially similar investments, of comparable credit quality relative to the sovereign credit risk of the Foreign Subsidiary’s country, denominated in the currency of any jurisdiction in which such Foreign Subsidiary conducts business.

“ CDOR Floor ” shall mean 2.00%.

“ CDOR Rate ” shall mean, on any date, the greater of (i) the CDOR Floor and (ii) the annual rate of interest which is the stated average of the rates applicable to Canadian Dollar bankers’ acceptances having a three month term identified as such on the “ Reuters Screen CDOR Page ” (as defined in the International SWAP Dealer Association, Inc. definitions, as modified and amended from time to time) at approximately 10:30 a.m., Ottawa time, on such day or, if such day is not a Business Day, then on the immediately preceding Business Day, (as adjusted by the Lender after 10:30 a.m., Ottawa time, to reflect any error in any posted rate or in the posted average annual rate). If the rate does not appear on the Reuters Screen CDOR Page as contemplated above, then the CDOR Rate on any day shall be calculated as the arithmetic average of the discount rates applicable to Canadian Dollar bankers’ acceptances having a three month term as quoted by at least four Canadian Schedule I chartered banks selected by Lender as of 10:30 a.m., Ottawa time, on the day, or if the day is not a Business Day, then on the immediately preceding Business Day.

“ Chair of the Joint Deputy Minister Automotive Steering Committee ” shall mean a government official designated by the Lender from time to time.

 

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“ Challenge Period ” shall have the meaning set forth in the US Credit Agreement.

“ Change of Control ” shall mean (a) with respect to the US Borrower, the acquisition, after the Effective Date, by any other Person, or two or more other Persons acting in concert other than the Permitted Holders, the Lender, the VEBA or any Affiliate of the Permitted Holders, the Lender or the VEBA, of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of outstanding shares of voting stock of the Borrower at any time if after giving effect to such acquisition such Person or Persons owns 20% or more of such outstanding voting stock or (b) the US Borrower ceases to own and control, directly or indirectly, 100% of the Equity Interests of the Borrower.

“ Claim ” shall have the meaning set forth in Section 12.03.

“ COCA ” shall mean the Canadian Operational Continuation Agreement dated as of July 10, 2009 among the Borrower, the US Borrower, Her Majesty the Queen in Right of Canada and Her Majesty the Queen in Right of the Province of Ontario.

“ Collateral ” shall have the same meaning as Facility Collateral.

“ Collateral Documents ” shall mean the Equity Pledge Agreements, the Security Agreements, and each Mortgage, and each other collateral assignment, security agreement, pledge agreement, agreement granting Liens in intellectual property rights, or similar agreements delivered to the Lender to secure the Obligations, as amended and restated herewith (if applicable).

“ Confidential Information ” shall mean all information in whatever form (whether written, oral, electronic or documentary), which is made available to the Receiving Party, directly or indirectly, by the Disclosing Party in connection with this Loan Agreement, which is either confidential, proprietary or otherwise not generally available to the public, and shall include any document, electronic record, correspondence, note, extract or analysis containing, recalling or recording Confidential Information, or which is derived from or reflects the review of Confidential Information, and all copies and extracts thereof. The following shall not be considered to be Confidential Information:

(a) information which at the time of disclosure by the Disclosing Party to the Receiving Party had been generally disclosed by the Disclosing Party to the public, or which thereafter is generally disclosed by the Disclosing Party to the public, other than as a result of disclosure by the Receiving Party; and

(b) information which prior to the time of disclosure by the Disclosing Party to the Receiving Party was in the possession of the Receiving Party on a lawful basis, or is thereafter lawfully acquired by the Receiving Party from a third party; provided that such information is not subject to a confidentiality agreement with, or other obligation of confidentiality or secrecy to the Disclosing Party;

provided that no combination of information which comprises part of the Confidential Information shall be included in the foregoing exceptions merely because individual parts of the information were within the public domain or were within the prior possession of the Receiving Party unless the combination itself was in the public domain or in the prior possession of the Receiving Party, or was so received by the Receiving Party.

 

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“ Consolidated ” or “ consolidated ” refers to the consolidation of accounts in accordance with GAAP.

“ Consolidated Leverage Ratio ” shall mean, as of any date, the ratio of (a) Consolidated Total Debt, less the sum of cash and Cash Equivalents held by the US Borrower and its Subsidiaries, excluding Restricted Cash, on such day to (b) EBITDA for the period of four fiscal quarters ended on the last day of the most recent fiscal quarter for which financial statements have been delivered pursuant to Section 7.01.

“ Consolidated Total Debt ” shall mean, at any date, the aggregate principal amount of all Indebtedness of the US Borrower and its Subsidiaries that would be reflected on a consolidated balance sheet of the US Borrower and its Subsidiaries as of such date in accordance with GAAP.

“ Contractual Obligation ” shall mean as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“ control ” shall have the meaning assigned to such term in the definition of Affiliate.

“ Copyright Licenses ” shall mean all licenses, contracts or other agreements, whether written or oral, naming the Borrower or a Subsidiary Guarantor as licensee or licensor and providing for the grant of any right to reproduce, publicly display, publicly perform, distribute, create derivative works of or otherwise exploit any works covered by any Copyright (including, without limitation, all Copyright Licenses set forth in Schedule 6.22 hereto).

“ Copyrights ” shall mean all domestic and foreign copyrights and intangibles of like nature, whether registered or unregistered, including, without limitation, all copyright rights throughout the universe (whether now or hereafter arising) in any and all media (whether now or hereafter developed), in and to all original works of authorship (including, without limitation, all marketing materials created by or on behalf of the Borrower or a Subsidiary Guarantor), acquired or owned by the Borrower or a Subsidiary Guarantor (including. without limitation, all copyrights described in Schedule 6.22 hereto), all applications, registrations and recordings thereof (including, without limitation, applications, registrations and recordings in the Canadian Intellectual property Office or in any similar office or agency of any other country or any political subdivision thereof), and all reissues, renewals, restorations, extensions or revisions thereof.

“ Default ” shall mean an event that with the giving of notice or the lapse of time or both, would become an Event of Default.

“ Design License ” shall mean all licenses, contracts or other agreements, whether written or oral, naming the Borrower or a Subsidiary Guarantor as licensee or licensor and providing for the grant of any right to manufacture, use, lease or sell or otherwise exploit any Design (including, without limitation, all Design Licenses set forth in Schedule 6.22 hereto).

 

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“ Designs ” shall mean all of the following now owned or hereafter acquired by the Borrower or a Subsidiary Guarantor (including, without limitation, all industrial designs and intangibles of like nature described in Schedule 6.22 hereto): (a) all industrial designs and intangibles of like nature (whether registered or unregistered), now owned or existing or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, including all registrations, recordings and applications in the Canadian Intellectual Property Office or in any similar office or agency in any other country or any political subdivision thereof, and (b) all reissues, extensions or renewals thereof.

“ Disclosing Party ” shall mean any Loan Party, its employees or their affiliates, agents, consultants, contractors, advisors or representatives.

“ Disposition ” shall mean with respect to any Property, any sale, lease, sale and leaseback, assignment, conveyance, transfer or other disposition thereof (other than (i) exclusive licenses that do not materially impair the relevant Loan Party’s ability to use or exploit the relevant Intellectual Property as it has been used or exploited by such Loan Party as of the Original Agreement Effective Date or (ii) nonexclusive licenses); and the terms “ Dispose ” and “ Disposed of ” shall have correlative meanings.

“ Domestic Subsidiary ” shall mean any Subsidiary that is organized or existing under the laws of the United States or Canada or any state, province, commonwealth or territory of the United States or Canada.

“ Due Diligence Review ” shall mean the performance by or on behalf of the Lender of any or all of the reviews permitted under Section 12.16, as desired by the Lender from time to time.

“ EBITDA ” shall mean for any period, Net Income  plus , to the extent deducted in determining Net Income, the sum of: (a) Interest Expense, amortization or write off of debt discount, other deferred financing costs and other fees and charges associated with Indebtedness, plus (b) tax expense, plus (c) depreciation, plus (d) amortization, write offs, write downs, asset revaluations and other non-cash charges, losses and expenses, plus (e) impairment of intangibles, including goodwill, plus (f) extraordinary expenses or losses (as determined in accordance with GAAP) including an amount equal to any extraordinary loss, plus (g) any net loss realized by the US Borrower or any of its Subsidiaries in connection with any Disposition or the extinguishment of Indebtedness, plus (h) special charges (including restructuring costs), plus (i) losses (but minus gains) due solely to the fluctuations in currency values or the mark-to-market impact of commodities derivatives, in each case in accordance with GAAP, plus (j) losses attributable to discontinued operations, plus (k) losses (but minus gains) attributable to the cumulative effect of a change in accounting principles, plus (l) non-recurring costs, charges and expenses during such period, plus (m) the amount of fees associated with advisory, consulting or other professional work done for equity offerings, minus (n) to the extent included in Net Income, extraordinary gains (as determined in accordance with GAAP), together with any related provision for taxes on such extraordinary gain, all calculated without duplication for the US Borrower and its Subsidiaries on a consolidated basis for such period. For purposes of this Loan Agreement, EBITDA shall (to the extent required to comply with Regulation S-X promulgated under the Securities Act) be adjusted on a pro forma basis to include, as of the first day of any applicable period, any acquisition and any Disposition contemplated by the Business Plan to be consummated during such period, including, without limitation, adjustments reflecting any non-recurring

 

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costs and any extraordinary expenses of any acquisition and any Disposition consummated during such period and any Pro Forma Cost Savings attributable thereto, each calculated on a basis consistent with GAAP or as otherwise approved by the Lender in its sole discretion.

“ EDC ” shall mean Export Development Canada.

“ EDC’s Percentage ” shall mean, on any date of determination, (i) in the event that EDC is the sole Lender party to this Loan Agreement, 100%, and (ii) in the event that there is more than one Lender party to this Loan Agreement, a percentage equal to (x) the aggregate outstanding principal balance of the Loan held by EDC on such date divided by (y) the aggregate outstanding principal balance of the Loan of all Lender parties to this Loan Agreement on such date.

“ EDC Rejection Notice ” shall mean, a notice from EDC to the Borrower rejecting a Mandatory Prepayment under this Loan Agreement in accordance with Section 2.07(d) hereof.

“ EESA ” shall mean the Emergency Economic Stabilization Act of 2008, Public Law No: 110-343 effective as of October 3, 2008, as amended by Section 7000 et al. of Division A, Title VII of the American Recovery and Reinvestment Act of 2009, Public Law No. 111-5, effective as of February 17, 2009, as may be further amended and in effect from time to time.

“ Effective Date ” shall mean July 10, 2009.

“ Electronic Transmission ” shall mean the delivery of information by electronic mail, facsimile or other electronic format acceptable to the Lender. An Electronic Transmission shall be considered written notice for all purposes hereof.

“ Environmental Indemnity Agreement ” shall mean that certain Environmental Indemnity Agreement, dated as of April 29, 2009, executed by the Borrower in connection with the Existing Loan Agreement for the benefit of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“ Equity Interests ” shall mean any and all equity interests, including any shares of stock, membership or partnership interests, participations or other equivalents whether certificated or uncertificated (however designated) of a corporation, limited liability company, partnership, joint venture or any other entity, and any and all similar ownership interests in a Person and any and all warrants or options to purchase any of the foregoing.

“ Equity Pledge Agreement ” shall mean, collectively, (a) that certain pledge agreement, dated as of the Effective Date, between the US Borrower and the Lender, acknowledged by the Borrower, and (b) those certain pledge agreements, dated as of the Original Agreement Effective Date, between the Borrower and the Lender, acknowledged by each of the applicable Pledged Entities listed therein.

“ ERISA ” shall have the meaning set forth in the US Credit Agreement.

“ Event of Default ” shall have the meaning set forth in Section 10.

 

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“ Exchange Act ” shall mean the United States Securities and Exchange Act of 1934 , as amended.

“ Exchange Rate ” shall mean, for any day with respect to any currency (other than Canadian Dollars) the Bank of Canada daily noon rate for such currency vis-à-vis Canadian Dollars as posted on the Bank of Canada website at or about noon (Toronto time) three (3) days (unless otherwise agreed by the Lender) prior to the date of the calculation for the purchase of Canadian Dollars with such currency. In the event that such rate is not available, such Exchange Rate shall instead be the spot rate of exchange of the Reference Bank, at or about 11:00 a.m. (Toronto time) on such day for purchase of Canadian Dollars with such currency, for delivery three (3) days (unless otherwise agreed by the Lender) later; provided, however, that if at any time of any such determination, for any reason, no such spot rate is being quoted, the Lender may use any reasonable method it deems appropriate to determine such rate, and such determination shall be conclusive absent manifest error.

“ Excluded Collateral ” shall mean:

(a) all Property of the US Borrower save and except all interest of the US Borrower in voting Equity Interests in the Borrower and all proceeds derived therefrom;

(b) Property of the Borrower and each Subsidiary Guarantor to the extent that a grant of a security interest therein (i) is prohibited by any Applicable Law, or requires a consent pursuant to Applicable Law that has not been obtained from any Governmental Authority or (ii) is contractually prohibited, or constitutes a breach or default under or results in the termination of any contract (except to the extent that such contract or the related prohibitive provisions therein are ineffective under Applicable Law), or requires a consent from any other Person (other than the Borrower or any of its Affiliates) that has not been obtained, in each case, to the extent such obligations and related Property are set forth on Schedule 1.01(a) in the case of any investment property (as such term is defined in the Personal Property Security Act) other than the Pledged Equity, is prohibited under any applicable organizational, constitutive, shareholder or similar agreement (except to the extent that such agreement or the related prohibitive provisions therein are ineffective under the Personal Property Security Act or other Applicable Law) and, in each case, to the extent only that the required consent or the prohibition in respect of the applicable Excluded Collateral described in any of the foregoing provisions of this definition then remains in full force and effect; and

(c) Property of the Borrower and of each Subsidiary Guarantor of any of the following types:

(i) any Equity Interests owned by the Borrower in any Subsidiary (except for the Equity Interests of the Subsidiary Guarantors and of General Motors Product Services, Inc.);

(ii) any Property (including any tangible embodiments of Intellectual Property that may be affixed to or embodied in any Property), including any Equity Interest, to the extent that the Borrower has assigned, pledged, or otherwise granted a security interest in or with respect to such Property to secure any indebtedness or any other obligations, prior to the Original Agreement Effective Date, to the extent that a grant of a security interest therein is contractually prohibited, or constitutes a breach or default under or results in the termination of

 

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any contract, or requires a consent from any other Person (other than the Borrower or any of its Affiliates) that has not been obtained, in each case, to the extent such obligations and related Property are set forth on Schedule 1.01(a) and, in each case, to the extent only that the competing security interest in the applicable Excluded Collateral described in any of the foregoing provisions of this definition then remains in full force and effect;

(iii) any Property of the Borrower acquired with (A) funds previously obtained from the Government of Canada or any Province, or (B) under any other government programs or using other government funds, including proceeds of government loans, contracts, grants, cooperative agreements, to the extent that a grant of a security interest therein is contractually prohibited, or constitutes a breach or default under or results in the termination of any contract or precludes eligibility for funding described in clauses (A) or (B) above or requires a consent from any other Person (other than the Borrower or any of its Affiliates) that has not been obtained, in each case, to the extent such obligations and related Property are set forth on Schedule 1.01(a);

(iv) any Property, including cash and Cash Equivalents, (A) pledged or deposited in connection with insurance, including worker’s compensation, unemployment insurance or other types of social security or pension benefits, (B) pledged or deposited to secure the performance of bids, tenders, statutory obligations, and surety, appeal, customs or performance bonds and similar obligations, or (C) pledged or deposited to secure reimbursement obligations in respect of letters of credit issued to support any obligations or liabilities described in clauses (A) or (B); provided that if and when any such Property is released from any such pledge or deposit, it shall cease to be Excluded Collateral;

(v) any real property listed in Schedule 1.01(a) and any leasehold property interests other than any such leasehold property interests used in or required for any manufacturing activities of the Borrower; and

(vi) any other property listed in Schedule 1.01(a).

“ Excluded Dispositions ” shall mean:

(a) Dispositions of inventory in the ordinary course of business;

(b) Dispositions of obsolete or worn-out property in the ordinary course of business, including leases with respect to facilities that are temporarily not in use or pending their Disposition;

(c) Dispositions of accounts receivable more than 90 days past due in connection with the compromise, settlement or collection thereof on market terms;

(d) Dispositions of any Equity Interest of any JV Subsidiary in accordance with the applicable joint venture agreement relating thereto;

(e) Dispositions of any Equity Interest of CAMI Automotive Inc.;

(f) any Disposition of (i) any Subsidiary Guarantor’s or Pledged Entity’s Equity Interests or other assets or Property of the Borrower or any Subsidiary Guarantor to the

 

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Borrower or any Subsidiary Guarantor, or (ii) any Subsidiary’s (other than a Subsidiary Guarantor’s or Pledged Entity’s) Equity Interests or other assets or Property of any Group Member (other than the Borrower or any Subsidiary Guarantor) to the Borrower or any of its Subsidiaries;

(g) any Disposition of Cash Equivalents in a manner that is not prohibited by the terms of this Loan Agreement or the other Loan Documents;

(h) any Disposition by the Borrower or any of its Subsidiaries of any dealership property or Equity Interest in a dealership Subsidiary to the operating management of a dealership or any Disposition of property in connection with the dealer optimization plan, in each case in the ordinary course of business; and

(i) the licensing and sublicensing of Patents, Trademarks and other Intellectual Property or other general intangibles to third persons on customary terms as determined by the board of directors, or such other individuals as they may delegate, in good faith and the ordinary course of business.

“ Excluded First Lien Indebtedness ” shall mean Indebtedness secured on a first priority basis by the Collateral or the US Collateral or any portion of either of the foregoing (other than (i) Indebtedness under the US Credit Agreement and the VEBA Note Facility, and (ii) Indebtedness described in clauses (a) through (m) (inclusive) and clause (p) of the definition of “ Permitted Indebtedness ”) in an aggregate amount not exceeding US$6,000,000,000 (or in the case of Permitted Indebtedness denominated in Canadian Dollars, the US Dollar Equivalent thereof) comprised of term loan and/or revolving credit loan facilities (including without limitation Structured Financing), provided that, (i) the aggregate amount of commitments under the revolving credit facilities, if any, together with any revolving credit facilities constituting Additional First Lien Indebtedness, shall not exceed US$4,000,000,000 (or in the case of Permitted Indebtedness denominated in Canadian Dollars, the US Dollar Equivalent thereof), (ii) with respect to any revolving credit facility, the amount of Indebtedness thereunder for the purpose of determining compliance with clause (i) of this definition shall equal the commitment thereunder and (iii) the lenders party thereto (or an agent on behalf of such lenders) shall have executed and delivered an intercreditor agreement in form and substance reasonably satisfactory to the Lender solely to the extent the loan parties to such Indebtedness are one or more of the Loan Parties.

“ Excluded Subsidiary ” shall have the meaning set forth in the US Credit Agreement.

“ Existing Agreements ” shall mean the agreements of the Loan Parties and their Subsidiaries in effect on the Effective Date and any extensions, renewals and replacements thereof so long as any such extension, renewal and replacement could not reasonably be expected to have a material adverse effect on the rights and remedies of the Lender under any of the Loan Documents.

“ Existing Loan Agreement ” shall have the meaning set forth in the Recitals.

 

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“ Expense Policy ” shall mean the US Borrower’s comprehensive written policy on excessive or luxury expenditures maintained and implemented in accordance with the Treasury regulations contained in 31 C.F.R. Part 30.

“ Extraordinary Receipts ” shall mean any (i) insurance proceeds (other than the proceeds of self-insurance) received by the Borrower or any Subsidiary Guarantor that are not the proceeds of a Recovery Event, (ii) downward purchase price adjustments (other than purchase price adjustments resulting from tax refunds received by the Borrower or any Subsidiary Guarantor), (iii) tax refunds (other than tax refunds received by the Borrower or any Subsidiary Guarantor), judgments and litigation settlements, pension plan reversions and indemnity payments received by the Borrower or any Subsidiary Guarantor, and (iv) similar receipts outside of the ordinary course of business in each case, in excess of CDN$10,000,000.

“ Facility Collateral ” shall mean (a) all Property of the Loan Parties other than Property constituting Excluded Collateral, all of which Property shall have been or shall be pledged to or for the benefit of the Lender under the applicable Loan Document, including each Mortgage and Security Agreement, and (b) all other property pledged to or for the benefit of the Lender under each Equity Pledge Agreement by a Loan Party or any other Person.

“ Financing Subsidiary ” shall mean any Subsidiary that is primarily engaged in financing activities including, without limitation (a) debt issuances to, or that are guaranteed by, governmental or quasi-governmental entities (including any municipal, local, county, regional, state, provincial, national or international organization or agency), (b) lease transactions (including synthetic lease transactions and Sale/Leaseback Transactions permitted hereunder) and (c) lease and purchase financing provided by such Subsidiary to dealers and consumers.

“ Fitch ” shall mean Fitch, Inc. d/b/a Fitch IBCA.

“ Foreign Subsidiary ” shall mean any Subsidiary that is not a Domestic Subsidiary.

“ GAAP ” shall mean generally accepted accounting principles as in effect from time to time in the United States or in Canada, as applicable.

“ GMCL Pension Agreement ” shall mean that certain General Motors Canada Limited – GMCL Pension Plans Funding Agreement among the Borrower, the Superintendent of Financial Services and Her Majesty the Queen in Right of Ontario, as represented by The Minister of Finance.

“ Governmental Authority ” shall mean, with respect to any Person, any nation or government, any province, state or other political subdivision, agency or instrumentality thereof, any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and any court or arbitrator having jurisdiction over such Person, any of its Subsidiaries or any of its properties.

“ Group Member ” shall have the meaning set forth in the US Credit Agreement.

“ Guarantee Agreement ” shall mean collectively, (a) that certain Guarantee Agreement dated as of the date of this Loan Agreement, by the US Borrower in favour of the

 

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Lender, guaranteeing the Obligations of the Borrower, (b) that certain Guarantee Agreement by each Subsidiary Guarantor in favour of the Lender, dated as of the Original Agreement Effective Date, guaranteeing the Obligations of the Borrower and (c) any Guarantee Agreement, by, in the event there is a US Parent Guarantor, such a US Parent Guarantor in favour of the Lender, guaranteeing on an unsecured basis the Obligations of the Borrower.

“ Guarantee Obligation ” shall mean as to any Person, any obligation of such Person directly or indirectly guaranteeing any Indebtedness of any other Person or in any manner providing for the payment of any Indebtedness of any other Person or otherwise protecting the holder of such Indebtedness against loss (whether by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, goods, securities or services, or to take-or-pay or otherwise), provided that the term “ Guarantee Obligation ” shall not include (i) endorsements for collection or deposit in the ordinary course of business, or (ii) obligations to make servicing advances for delinquent taxes and insurance, or other obligations in respect of the Collateral, to the extent required by the Lender. The amount of any Guarantee Obligation of a Person shall be deemed to be an amount equal to the stated or determinable amount of the primary Indebtedness in respect of which such Guarantee Obligation is made or, if not stated or determinable, the maximum reasonably anticipated Indebtedness in respect thereof as determined by such Person in good faith. The terms “ Guarantee ” and “ Guaranteed ” used as verbs shall have correlative meanings.

“ Guarantors ” shall mean each of (i) the US Borrower, (ii) the Subsidiary Guarantors, and (iii) any US Parent Guarantor.

“ Health Care Trust Agreement ” means that certain Health Care Trust term sheet dated as of June 26, 2009 between the Borrower and the National Automobile Aerospace, Transportation and General Workers Union, and which may be superseded by an agreement between such parties pursuant to such term sheet.

“ Indebtedness ” shall mean, for any Person: (a) obligations created, issued or incurred by such Person for borrowed money (whether by loan, the issuance and sale of debt securities or the sale of Property to another Person subject to an understanding or agreement, contingent or otherwise, to repurchase such Property from such Person (other than any repurchase obligations accounted for as operating leases)); (b) obligations of such Person to pay the deferred purchase or acquisition price of Property or services (other than trade payables or obligations associated with the purchase of tooling, machinery, equipment and engineering and design services, in each case incurred in the ordinary course of business); (c) indebtedness of others of the type referred to in clauses (a), (b), (d), (e), (f), (g) and (i) of this definition secured by a Lien on the Property of such Person, whether or not the respective indebtedness so secured has been assumed by such Person (provided, that for purposes of this Loan Agreement the amount of such Indebtedness shall be deemed to be the lower of (x) the book value of such Property and (y) the principal amount of the indebtedness secured by such Property); (d) obligations (contingent or otherwise) of such Person in respect of letters of credit or similar instruments issued or accepted by banks and other financial institutions for the account of such Person; (e) Capital Lease Obligations or Attributable Obligations of such Person; (f) [intentionally omitted]; (g) indebtedness of others of the type referred to in clauses (a) (b), (d), (e), (f), (h) and (i) of this definition guaranteed by such Person; (h) all purchase money indebtedness of such Person; (i) indebtedness of general partnerships of which such Person is a

 

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general partner unless the terms of such indebtedness expressly provide that such Person is not liable therefor; and (j) any other indebtedness of such Person evidenced by a note, bond, debenture or similar instrument; provided, however, that Indebtedness shall exclude any obligations related to the hourly pension plans of Delphi Corporation and its Affiliates.

“ Individual Property ” shall mean each parcel of real property, the improvements thereon and fixtures owned by the Borrower and encumbered by a Mortgage, together with all rights pertaining to such real property, improvements and fixtures, as more particularly described in each Mortgage and referred to therein as the “ Property ”; provided that Individual Property shall exclude any Property constituting Excluded Collateral.

“ Ineligible Acquirer ” shall mean any Person (i) directly involved in the manufacture of motor vehicles or the business of which is restricted primarily to the financing of the sale or lease of motor vehicles or (ii) having beneficial ownership of 20% or more of the Equity Interests of a Person described in clause (i).

“ Initial Note ” shall mean an Amended and Restated Promissory Note of the Borrower evidencing the Loan, substantially in the form of Exhibit A, with appropriate insertion as to date and principal.

“ Insolvency Exceptions ” shall mean limitations on, or exceptions to, the enforceability of an agreement against a Person due to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally or the application of general equitable principles, regardless of whether such enforceability is considered in a proceeding at law or in equity.

“ Intellectual Property ” shall mean all Patents, Trademarks, Designs, Copyrights, Technical Information, trade secrets and customer lists and all rights under any Licenses to which the Borrower or any Subsidiary Guarantor is a party.

“ Interest Expense ” shall mean for any Person for any period, consolidated total interest expense of such Person and its Subsidiaries for such period and including, in any event, costs under interest rate swap agreements, interest rate cap agreements, interest rate collar agreements and interest rate insurance for such period.

“ Interest Payment Date ” shall mean the last Business Day of each calendar quarter, commencing with the first calendar quarter that ends after the Effective Date.

“ Interest Period ” shall mean (i) an initial Interest Period commencing on the Effective Date and ending on the first Interest Payment Date following the Effective Date; and (ii) thereafter, each period commencing on an Interest Payment Date and ending on the calendar day prior to the next succeeding Interest Payment Date. Notwithstanding the foregoing, no Interest Period may end after the Maturity Date.

“ Investment ” shall mean any advance, loan, extension of credit (by way of guarantee or otherwise) or capital contribution to, or purchase of any Equity Interests, bonds, notes, debentures or other debt securities of, or any assets constituting a business unit of, or any other investment in, any Person.

 

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“ Judgment Currency ” shall have the meaning set forth in Section 2.12.

“ JV Agreement ” shall mean each partnership or limited liability company agreement (or similar agreement) between the Borrower or any Subsidiary Guarantor and the relevant JV Partner as the same may be amended, restated, supplemented or otherwise modified from time to time, in accordance with the terms hereof.

“ JV Partner ” shall mean each Person party to a JV Agreement that is not: (a) a Loan Party or one of its Subsidiaries; (b) a corporation incorporated to carry on automotive dealership operations; or (c) Canadian Satellite Radio Holdings Inc.

“ JV Subsidiary ” shall mean any Subsidiary of the Borrower or of a Subsidiary of the Borrower, which is not a Wholly Owned Subsidiary and as to which the business and management thereof is jointly controlled by the holders of the Equity Interests therein pursuant to customary joint venture arrangements.

“ Lender ” shall have the meaning set forth in the preamble hereof, and its permitted successors and assigns.

“ Lender Parties ” shall have the meaning set forth in Section 12.03.

“ Licenses ” shall mean the Copyright Licenses, the Design Licenses, the Technical Information Licenses, the Trademark Licenses and the Patent Licenses.

“ Lien ” shall mean any mortgage, pledge, security interest, lien or other charge or encumbrance (in the nature of a security interest and other than licenses of Intellectual Property), including the lien or retained security title of a conditional vendor, upon or with respect to any property or assets.

“ Loan ” all have the meaning set forth in Section 2.01.

“ Loan Agreement ” shall mean this Second Amended and Restated Loan Agreement, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with the terms hereof.

“ Loan Documents ” shall mean this Loan Agreement, the Notes, the Equity Pledge Agreements, the Security Agreement, the Guarantee Agreements, the Post-Closing Agreement, each Mortgage, and the Environmental Indemnity Agreement and all other documents, agreements and instruments now or from time to time hereafter executed by or on behalf of any Loan Party or any Guarantor or any other Person to evidence and secure the Obligations or the transactions contemplated hereby. For the avoidance of doubt, the Loan Documents do not include the COCA.

“ Loan Parties ” shall mean the Borrower and the Subsidiary Guarantors and “ Loan Party ” shall mean each of them.

“ Mandatory Prepayment ” shall have the meaning set forth in Section 2.07.

“ Mandatory Prepayment Date ” shall have the meaning set forth in Section 2.07.

 

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“ Master Transaction Agreement ” shall have the meaning set forth in the US Credit Agreement.

“ Material Adverse Effect ” shall mean a material adverse effect on (a) the business, operations, property, condition (financial or otherwise) or prospects of (i) the North American Group Members (taken as a whole) or (ii) the Group Members (taken as a whole), (b) the ability of the Loan Parties (taken as a whole) to perform their obligations under any of the Loan Documents to which they are a party, (c) the validity or enforceability in any material respect of any of the Loan Documents to which the Loan Parties are a party, (d) the rights and remedies of the Lender under any of the Loan Documents, or (e) the Collateral (taken as a whole); provided that (w) the taking of any action by the Borrower and its Subsidiaries, including the cessation of production, pursuant to and in accordance with the Budget, (x) the filing and continuance of the Cases and the orders thereunder, and (y) any action taken pursuant to the Section 363 Sale Order shall not be taken into consideration.

“ Maturity Date ” shall mean the sixth (6th) anniversary of the Effective Date.

“ Moody’s ” shall mean Moody’s Investors Service, Inc. and its successors.

“ Mortgage ” shall mean, with respect to each Individual Property, that certain charge/mortgage of land (or deed of trust or deed to secure debt or debenture, as applicable), assignment of leases and rents, and Security Agreement or similar agreement, executed and delivered by the Borrower as security for the Obligations and encumbering such Individual Property, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“ Net Cash Proceeds ” shall mean with respect to any event, (a) the cash proceeds received in respect of such event including (i) any cash received in respect of any non cash proceeds (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise, but excluding any interest payments), but only as and when received, (ii) in the case of a casualty, insurance proceeds and (iii) in the case of a condemnation or similar event, condemnation awards and similar payments, net of (b) the sum of (i) all reasonable fees and out-of-pocket expenses paid to third parties (other than Affiliates) in connection with such event, (ii) in the case of a Disposition of an asset (including pursuant to a Sale/Leaseback Transaction or a casualty or a condemnation or similar proceeding), the amount of all payments required to be made as a result of such event to repay Indebtedness (other than the Loan) secured by such asset or otherwise subject to mandatory prepayment or lease obligations, as applicable, as a result of such event and (iii) the amount of all taxes paid (or reasonably estimated to be payable, including under any tax sharing arrangements) and, with respect to amounts that will be expatriated as a result of any event attributable to a Foreign Subsidiary, the amount of any taxes that will be payable by any applicable Group Member as a result of the expatriation, and the amount of any reserves established to fund contingent liabilities reasonably estimated to be payable, in each case that are directly attributable to such event (as determined reasonably and in good faith by a Responsible Officer).

“ Net Income ” shall mean, for any period, the net income (or loss) of the US Borrower and its Subsidiaries calculated on a consolidated basis for such period determined in accordance with GAAP.

 

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“ Non-Excluded Taxes ” shall have the meaning provided in Section 3.03.

“ North American Group Members ” shall have the meaning set forth in the US Credit Agreement.

“ Notes ” shall mean the Initial Note and any promissory note issued in connection with an assignment as contemplated by Section 12.15 and any promissory notes delivered in substitution or exchange therefor, in each case as the same shall be modified and supplemented and in effect from time to time.

“ Obligation Currency ” shall have the meaning set forth in Section 2.11.

“ Obligations ” shall mean (a) all of the Borrower’s obligations to repay the Loan on the Maturity Date, to pay interest on an Interest Payment Date and all other obligations and liabilities of each Loan Party to the Lender, or any other Person arising under, or in connection with, the Loan Documents, whether now existing or hereafter arising; (b) any and all sums paid by the Lender pursuant to the Loan Documents in order to preserve any Collateral or the interest of the Lender therein; (c) in the event of any proceeding for the collection or enforcement of any of the Loan Parties’ or any other Person’s obligations or liabilities referred to in clause (a), the reasonable expenses of retaking, holding, collecting, preparing for sale, selling or otherwise disposing of or realizing on any Collateral, or of any exercise by the Lender of its rights under the Loan Documents, including without limitation, reasonable attorneys’ fees and disbursements and court costs; and (d) all of the Loan Parties’ or other Person’s indemnity obligations to the Lender pursuant to the Loan Documents, provided that for purposes of any Collateral Documents to which the US Borrower or the US Parent Guarantor is not a party, the term Obligations shall not include obligations of such Person under its Guarantee Agreement.

“ Offer Date ” shall have the meaning set forth in Section 2.07.

“ Original Agreement Effective Date ” shall mean April 29,2009.

“ Other Taxes ” shall mean any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Loan Agreement or any other Loan Document (excluding, in each case, amounts imposed on an assignment, a grant of a Participation or other transfer of an interest in the Loan or any Loan Document).

“ Participant ” shall have the meaning set forth in Section 12.15 hereto.

“ Participation ” shall have the meaning set forth in Section 12.15 hereto

“ Patent Licenses ” shall mean all licenses, contracts or other agreements, whether written or oral, naming the Borrower or any Subsidiary Guarantor as licensee or licensor and providing for the grant of any right to manufacture, use, lease, or sell any invention, design, idea, concept, method, technique, or process covered by any Patent (including, without limitation, all Patent Licenses set forth in Schedule 6.22 hereto).

 

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“ Patents ” shall mean all domestic and foreign letters patent, design patents, utility patents, and all intellectual property rights in inventions, and other general intangibles of like nature, now existing or hereafter acquired or owned by the Borrower or any Subsidiary Guarantor (including, without limitation, all domestic and foreign letters patent, design patents, utility patents, and inventions described in Schedule 6.22 hereto), all applications, registrations and recordings thereof (including, without limitation, applications, registrations and recordings in the Canadian Intellectual Property Office, or in any similar office or agency in any other country or any political subdivision thereof), and all reissues, divisions, continuations, continuations in part and extensions or renewals thereof.

“ Permitted Holders ” shall have the meaning set forth in the US Credit Agreement.

“ Permitted Indebtedness ” shall mean:

(a) Indebtedness created under any Loan Document;

(b) purchase money Indebtedness for real property, improvements thereto or equipment or personal property hereafter acquired (or, in the case of improvements, constructed) by, or Capital Lease Obligations of the Borrower or the Subsidiary Guarantors provided that, the aggregate principal balance of such Indebtedness shall not exceed CDN$200,000,000 at any one time outstanding;

(c) trade payables, if any, in the ordinary course of its business;

(d) Indebtedness existing on the Effective Date;

(e) intercompany Indebtedness of (i) North American Group Members and (ii) Subsidiary Guarantors, in each case, in the ordinary course of business; provided that, the right to receive any repayment of such Indebtedness (other than any scheduled payments so long as no Event of Default has occurred and is continuing) shall be subordinated to the Lender’s rights to receive repayment of the Obligations;

(f) Indebtedness existing at the time any Person merges with or into or becomes a North American Group Member and not incurred in connection with, or in contemplation of, such Person merging with or into or becoming a North American Group Member; provided that any such merger shall comply with Section 8.01;

(g) Swap Agreements that are not entered into for speculative purposes;

(h) Indebtedness, including letters of credit, bankers’ acceptances and similar instruments issued in the ordinary course of business, in respect of the financing of insurance premiums, customs, stay, performance, bid, surety or appeal bonds and similar obligations, completion guaranties, “take or pay” obligations in supply agreements, reimbursement obligations regarding workers’ compensation claims, indemnification, adjustment of purchase price and similar obligations incurred in connection with the acquisition or disposition of any business or assets, and sales contracts, coverage of long-term counterparty risk in respect of insurance companies, purchasing and supply agreements, rental deposits, judicial appeals and service contracts;

 

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(i) Indebtedness incurred in the ordinary course of business in connection with cash management and deposit accounts and operations, netting services, employee credit card programs and similar arrangements and Indebtedness arising from the honouring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is extinguished within five Business Days of its incurrence;

(j) any guarantee by any Loan Party of Permitted Indebtedness;

(k) any extensions, renewals, exchanges or replacements of Indebtedness of the kind in clauses (a), (d), (e), (f), (g) and (h) of this definition to the extent (i) the principal amount of or commitment for such Indebtedness is not increased (except by an amount equal to unpaid accrued interest and premium thereon plus other reasonable fees and expenses incurred in connection with such extension, renewals or replacement), (ii) neither the final maturity nor the weighted average life to maturity of such Indebtedness is decreased and (iii) such Indebtedness, if subordinated in right of payment to the Lender of the Indebtedness under this Loan Agreement, remains so subordinated on terms no less favorable to the Lender;

(l) any Sale/Leaseback Transaction; provided that, if on the date such Indebtedness is incurred, the Consolidated Leverage Ratio is greater than or equal to 3.00 to 1.00 after giving pro forma effect to such Indebtedness, an amount equal to the Applicable Net Cash Proceeds of the Attributable Obligations under such Sale/Leaseback Transaction shall be applied as a prepayment of the Loan in accordance with Section 2.07(a);

(m) Indebtedness under the Supplier Receivables Facility;

(n) Excluded First Lien Indebtedness and Additional First Lien Indebtedness;

(o) Permitted Unsecured Indebtedness; and

(p) any transactions undertaken by the Borrower or any Guarantor with 1908 Holdings, Parkwood Holdings Ltd. or GM Overseas Funding LLC in the ordinary course, consistent with past practice (or, in the case of the US Borrower, consistent with past practice of the GM Oldco Parties, as such term is defined in the US Credit Agreement).

“ Permitted Liens ” shall mean, with respect to any Property of the Borrower and its Subsidiaries:

(a) Liens created in favour of any Lender under the Loan Documents;

(b) Liens on Property of the Loan Parties existing on the date hereof (including Liens on Property of the Borrower or a Subsidiary Guarantor pursuant to Existing Agreements; provided that such Liens and any renewal, replacement, amendment, extension or modification in whole or in part thereof shall secure only those obligations that they secure on the date hereof and any permitted refinancing thereof);

(c) any Lien existing on any Property prior to the acquisition thereof by the Borrower or any Subsidiary Guarantor or existing on any Property of any Person that becomes a

 

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Subsidiary Guarantor after the date hereof prior to the time such Person becomes a Subsidiary Guarantor; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Subsidiary Guarantor, (ii) such Lien does not apply to any other Property or assets of the Borrower or a Subsidiary Guarantor, and (iii) such Lien and any renewal replacement amendment extension or modification in whole or in part thereof secures only those obligations that it secures on the date of such acquisition or the date such Person becomes a Subsidiary Guarantor, as the case may be;

(d) Liens for taxes, assessments, governmental charges and utility charges not yet due or that are being contested in good faith, by proper proceedings diligently pursued, and as to which adequate reserves have been provided;

(e) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business and securing obligations that are not due and payable or that are being contested in good faith by appropriate proceedings and in respect of which adequate reserves have been provided for in accordance with GAAP;

(f) Liens securing Indebtedness permitted by clause (h) of the definition of “ Permitted Indebtedness ”; provided that, the aggregate principal balance of the Indebtedness at any one time outstanding secured by such Liens shall not exceed the greater of (x) CDN$160,000,000 and (y) the maximum amount of Liens securing such Indebtedness permitted to be issued or incurred by North American Group Members and Structured Financing Subsidiaries under any Excluded First Lien Indebtedness and Additional First Lien Indebtedness;

(g) Liens securing Swap Agreements permitted by clause (g) of the definition of “ Permitted Indebtedness ”;

(h) Liens securing Indebtedness permitted by clause (i) of the definition of “ Permitted Indebtedness ”;

(i) customary Liens in favour of trustees and escrow agents, and netting and set-off rights, bankers rights of combination of accounts and the like in favour of counterparties to financial obligations and instruments;

(j) pledges and deposits made in the ordinary course of business in compliance with workmen’s compensation, employment or other insurance and other social security laws or regulations;

(k) deposits to secure the performance of bids, trade contracts (other than for Indebtedness), leases (other than Capital Lease Obligations), statutory obligations, surety, customs and appeal bonds, performance bonds and other obligations of a like nature, or to secure the payment of import or customs duties, in each case incurred in the ordinary course of business;

(l) zoning and environmental restrictions, easements, licenses, encroachments, covenants, servitudes, rights-of-way, restrictions on use of real property or groundwater, institutional controls and other similar encumbrances or deed restrictions (A) incurred in the ordinary course of business that, in the aggregate, are not substantial in amount and do not materially detract from the value of the property subject thereto or interfere with the ordinary conduct of the business of the Borrower or any Subsidiary Guarantor; or (B) as set out in the title insurance policies required to be delivered under the Existing Loan Agreement;

 

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(m) purchase money security interests in real property, improvements thereto or equipment or personal property hereafter acquired (or, in the case of improvements, constructed) by the Borrower or any Subsidiary Guarantor, including pursuant to Capital Lease Obligations; provided that (i) such security interests secure Indebtedness permitted by Section 8.08, (ii) such security interests are incurred, and the Indebtedness secured thereby is created, within 90 days after such acquisition (or construction), (iii) the Indebtedness secured thereby does not exceed the lesser of the cost or the fair market value of such real property, improvements or equipment at the time of such acquisition (or construction) and (iv) such security interests do not apply to any other property or assets of the Borrower or any Subsidiary Guarantor;

(n) judgment Liens securing judgments not constituting an Event of Default under Section 10;

(o) any Lien consisting of rights reserved to or vested in any Governmental Authority by statutory provision;

(p) Liens securing Indebtedness described in clauses (d), (e), (l) and (n) of the definition of Permitted Indebtedness;

(q) pledges or deposits made to secure reimbursement obligations in respect of letters of credit issued to support any obligations or liabilities described in clauses (j) or (k) of this definition;

(r) liens securing the Supplier Receivables Facility;

(s) statutory Liens incurred or pledges or deposits made in favour of a Governmental Authority to secure the performance of obligations of the Borrower and its Subsidiaries under Environmental Laws to which any assets of the Borrower or any such Subsidiary are subject;

(t) other Liens created or assumed in the ordinary course of business of the Borrower or any Subsidiary Guarantor; provided that the obligations secured by all such Liens shall not exceed the principal amount of CDN$15,000,000 in the aggregate at any one time outstanding;

(u) Liens securing Additional First Lien Indebtedness;

(v) Liens on securities accounts (other than Liens to secure Indebtedness);

(w) Liens under industrial revenue, municipal or similar bonds, only to the extent the corresponding Indebtedness is Permitted Indebtedness;

(x) servicing agreements, development agreements, site plan agreements and other agreements with Governmental Authorities pertaining to the use or development of any of the properties and assets of the Borrower or any Subsidiary consisting of real property, provided the same are complied with;

 

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(y) Liens arising from security interests granted by Persons who are not Affiliates of the Borrower in such Person’s co-ownership interest in Intellectual Property that such Person co-owns together with any Group Member; and

(z) during the Challenge Period, Liens securing Reserved Claims and/or the Senior Lien Loans (as defined in the Existing Loan Agreement).

“ Permitted Unsecured Indebtedness ” shall mean unsecured Indebtedness of the Group Members (other than Excluded Subsidiaries) other than unsecured Indebtedness described in clauses (a) through (m) (inclusive) and clause (p) of the definition of “ Permitted Indebtedness ”, provided that, (i) solely in the case of such unsecured Indebtedness incurred by the US Borrower or any Domestic Subsidiary (other than Excluded Subsidiaries), in the event that such unsecured Indebtedness, when aggregated with all other Permitted Unsecured Indebtedness of the US Borrower and its Domestic Subsidiaries (other than Excluded Subsidiaries) then outstanding or to be issued or incurred simultaneously with such unsecured Indebtedness, exceeds US$1,000,000,000, then on the date such Indebtedness is incurred, the Consolidated Leverage Ratio shall be less than 3.00 to 1.00 after giving pro forma effect to the incurrence of such Indebtedness, (ii) with respect to any revolving credit facility, the amount of Indebtedness for the purpose of determining compliance with clause (i) of this definition shall equal the related commitment thereunder and (iii) a portion of the Net Cash Proceeds of such Indebtedness (other than revolving credit loans) are used to prepay the Loans in accordance with Section 2.07.

“ Personal ” shall mean any individual, corporation, company, voluntary association, partnership, joint venture, limited liability company, trust, unincorporated association or government (or any agency, instrumentality or political subdivision thereof or other entity of whatever nature).

“ Personal Property Security Act ” or “ PPSA ” shall mean the Personal Property Security Act (Ontario) and the Regulations and ministerial orders thereunder, as from time to time in effect, provided, however, if attachment, perfection or priority of Lender’s security interests in any collateral are governed by the personal property security laws of any jurisdiction other than Ontario, PPSA shall mean those personal property security laws in such other jurisdiction for the purposes of the provisions hereof relating to such attachment, perfection or priority and for the definitions related to such provisions.

“ Plan ” shall mean any Canadian Benefit Plan or Canadian Pension Plan.

“ Pledged Entity ” shall mean the Borrower, each Subsidiary Guarantor and General Motors Product Services, Inc.

“ Pledged Equity ” shall mean all of the Equity Interests of a Pledged Entity, together with all ownership certificates, options or rights of any nature whatsoever which may be issued, granted or pledged by the owners of such interests to the Lender while this Loan Agreement is in effect.

 

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“ Pledgors ” shall mean the US Borrower and the Borrower.

“ Post-Closing Agreement ” shall mean that certain Post-Closing Agreement, dated as of July 10, 2009, by and between the Borrower and the Lender, as amended and restated from time to time.

“ Post-Default Rate ” shall mean, in respect of any principal of the Loan or any other amount under this Loan Agreement, the Notes, or any other Loan Document that is not paid when due to the Lender (whether at stated maturity, by acceleration or mandatory prepayment or otherwise), a rate per annum during the period from and including the due date to but excluding the date on which such amount is paid in full equal to 2.00% per annum, plus (x) the interest rate otherwise applicable to the Loan or other amount, or (y) if no interest rate is otherwise applicable, the sum of (i) CDOR Rate plus (ii) the Spread Amount.

“ Pro Forma Cost Savings ” shall mean with respect to any period, the reduction in net costs and related adjustments that (i) were directly attributable to an acquisition or a Disposition that occurred during the four-quarter period or after the end of the four-quarter period and on or prior to the applicable calculation date and calculated on a basis that is consistent with Regulation S-X, (ii) were actually implemented by the business that was the subject of any such acquisition or Disposition within six months after the date of the acquisition or Disposition and prior to the applicable calculation date that are supportable and quantifiable by the underlying accounting records of such business or (iii) relate to the business that is the subject of any such acquisition or Disposition and that the US Borrower reasonably determines are probable based upon specifically identifiable actions to be taken within six months of the date of the acquisition or Disposition and, in the case of each of (i), (ii) and (iii), are described, as provided below, in an officers’ certificate, as if all such reductions in costs had been effected as of the beginning of such period. Pro Forma Cost Savings described above shall be set forth in a certificate delivered to the Lender from the US Borrower’s chief financial officer, treasurer or assistant treasurer that outlines the specific actions taken or to be taken, the net cost savings achieved or to be achieved from each such action and that, in the case of clause (iii) above, such savings have been determined to be probable.

“ Proceeds ” shall have the meaning assigned to such term under the Uniform Commercial Code or the Personal Property Security Act (as applicable).

“ Property ” shall mean any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible.

“ PV Facility ” shall mean the new term loan facility made to the US Borrower by the Lender in an amount equivalent to the Canadian Dollar Equivalent of US$3,887,000,000.00 for purposes of funding the pension and/or other post-employment benefits of the Borrower.

“ Receiving Party ” shall mean (i) the Lender, its employees, agents, consultants, contractors, advisors and representatives; (ii) Industry Canada, its employees, agents, consultants, contractors, advisors and representatives; or (iii) the Ontario Ministry of Economic Development, its employees, agents, consultants, contractors, advisors and representatives.

“ Records ” shall mean all books, instruments, agreements, customer lists, credit files, computer files, storage media, tapes, disks, cards, software, data, computer programs,

 

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printouts and other computer materials and records generated by other media for the storage of information maintained by any Person with respect to the business and operations of the Loan Parties and the Collateral.

“ Recovery Event ” shall mean any settlement of or payment in respect of any property or casualty insurance claim (other than the proceeds of any self-insurance) or any condemnation proceeding relating to any asset of the Borrower or any Subsidiary Guarantor in each case, in excess of CDN$10,000,000.

“ Reference Bank ” shall mean the principal office of a bank listed on Schedule 1 of the Bank Act (Canada) as advised by the Lender to the Borrower in writing from time to time.

“ Register ” shall have the meaning set forth in Section 12.15.

“ Registration Rights Agreement ” shall mean the Equity Registration Rights Agreement, dated as of July 10, 2009, by and among the US Borrower, Treasury, 7176384 Canada Inc., a corporation organized under the laws of Canada, the VEBA, and Motors Liquidation Company (formerly known as General Motors Corporation), a Delaware corporation.

“ Reinvestment Deferred Amount ” shall mean with respect to any Reinvestment Event, an amount equal to the specified portion of the Net Cash Proceeds received by any applicable Group Member in connection therewith that is intended to be reinvested as stated in the applicable Reinvestment Notice.

“ Reinvestment Event ” shall mean any Asset Sale or Recovery Event in respect of which the Borrower has delivered a Reinvestment Notice.

“ Reinvestment Notice ” shall mean a written notice executed by a Responsible Officer stating that no Default or Event of Default has occurred and is continuing and that the Borrower (directly or indirectly through a Subsidiary) intends and expects to use all or a specified portion of the Net Cash Proceeds of an Asset Sale or Recovery Event (or committed to be expended pursuant to a binding contract) to acquire or repair assets useful in its business.

“ Reinvestment Prepayment Amount ” shall mean with respect to any Reinvestment Event, the Reinvestment Deferred Amount relating thereto less any amount expended (or committed to be expended pursuant to a binding contract) prior to the relevant Reinvestment Prepayment Date to acquire or repair assets useful in the Borrower’s business.

“ Reinvestment Prepayment Date ” shall mean with respect to any Reinvestment Event, the earlier of (a) the date occurring one year after such Reinvestment Event and (b) the date on which the Borrower shall have made a final determination not to, or shall have otherwise ceased to, acquire or repair assets useful in the Borrower’s business with all or any portion of the relevant Reinvestment Deferred Amount.

“ Rejected Prepayment Amount ” shall meaning set forth in Section 2.07.

“ Related Transactions ” shall mean each of the transactions described in the Transaction Documents.

 

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“ Relevant Period ” shall mean, subject to Section 7.27(a), the period beginning on the Effective Date and ending on the date that is the latest to occur of the date a Canadian Entity ceases to own any (i) direct or indirect Equity Interest in the Borrower, and (ii) of the Loan hereunder.

“ Requirement of Law ” shall mean as to any Person, the certificate of incorporation and by-laws or other organizational or governing documents of such Person, and any Applicable Law or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or final and binding upon such Person or any of its property or to which such Person or any of its property is subject.

“ Reserved Claims ” shall have the meaning set forth in the US Credit Agreement.

“ Responsible Officer ” shall mean, as to any Person, the chief executive officer or, with respect to financial matters (including, without limitation those matters set forth in Section 7.02(p)), the chief financial officer, treasurer or assistant treasurer of such Person, an individual so designated from time to time by such Person’s board of directors or, for the purposes of Section 7.02 only (other than Section 7.02(p)), the secretary or an assistant secretary of the Borrower, or, in the event any such officer is unavailable at any time he or she is required to take any action hereunder, “ Responsible Officer ” shall mean any officer authorized to act on such officer’s behalf as demonstrated by a certificate or corporate resolution (or equivalent); provided that the Lender is notified in writing of the identity of such Responsible Officer. Unless otherwise qualified, all references to “Responsible Officer” in this Loan Agreement shall refer to a Responsible Officer of the Borrower.

“ Restricted Cash ” shall mean cash, in whatever currency of denomination, and Cash Equivalents of the Borrower or any of its Subsidiaries (i) that is subject to a Lien (other than (x) the Liens created pursuant to the Collateral Documents (y) ordinary course set-off rights of depository banks for charges and fees related to amounts held therewith and (z) Liens for the benefit of any Loan Party arising under intercompany transactions), or (ii) the use of which is otherwise restricted pursuant to any Requirement of Law or Contractual Obligation. Notwithstanding the foregoing, none of the cash, in whatever currency of denomination, and Cash Equivalents of the Borrower or any of its Subsidiaries deposited with a trustee of any short-term or long-term voluntary employee’s beneficiary association which the Borrower or relevant Subsidiary may access on an unrestricted basis for use in its business shall constitute Restricted Cash.

“ Restricted Payment ” shall have the meaning set forth in the US Credit Agreement.

“ Reuters Screen CDOR Page ” shall mean the display designated as page CDOR on the Reuters Monitor Money Rates Service or other page as may, from time to time, replace that page on that service for the purpose of displaying bid quotations for bankers’ acceptances by leading Canadian banks.

“ S&P ” shall mean Standard & Poor’s Ratings Services, a division of The McGraw Hill Companies, Inc. and its successors.

 

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“ Sale/Leaseback Transaction ” shall mean any arrangement with any Person providing for the leasing by any Group Member (other than any Excluded Subsidiary, except Financing Subsidiaries) of real or personal property that has been or is to be sold or transferred by the applicable Group Member to such Person, including any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of the applicable Group Member.

“ Section 363 Sale ” shall have the meaning set forth in Section 5.01(c).

“ Section 363 Sale Order ” shall have the meaning set forth in Section 5.01(c).

“ Securities Act ” shall mean the United States Securities Act of 1933, as amended.

“ Securitization Subsidiary ” shall mean any Subsidiary formed for the purpose of, and that engages in, one or more receivables or securitization financing facilities and other activities reasonably related thereto.

“ Security Agreements ” shall mean collectively, (a) that certain General Security Agreement, dated as of the Original Agreement Effective Date between the Borrower and the Lender, (b) those certain General Security Agreements, dated as of the Original Agreement Effective Date between the applicable Subsidiary Guarantor and the Lender, and (c) that certain Deed of Hypothec, dated the Original Agreement Effective Date, between the Borrower and the Lender, each as amended, restated, supplemented or otherwise modified from time to time.

“ Senior Canadian Employee ” shall mean, with respect to the Borrower and its majority owned Canadian Subsidiaries (other than CAMI Automotive Inc.) collectively, any of their employees who are one of the five (5) most highly compensated employees of the Borrower and its majority owned Canadian Subsidiaries (other than CAMI Automotive Inc.).

“ Senior Employee ” shall mean any of the 25 most highly compensated employees (including the SEOs) of the US Borrower and its Subsidiaries, as determined pursuant to the rules set forth in 31 C.F.R. Part 30.

“ SEO ” shall mean a senior executive officer of the US Borrower as defined in the EESA and any interpretation of such term by the Treasury thereunder, including the rules set forth in 3 1 C.F.R. Part 30.

“ Specified Benefit Plan ” shall mean any employee benefit plan within the meaning of section 3(3) of ERISA and any other plan, arrangement or agreement which provides for compensation, benefits, fringe benefits or other remuneration to any employee, former employee, individual independent contractor or director, including any bonus, incentive, supplemental retirement plan, golden parachute, employment, individual consulting, change of control, bonus or retention agreement, whether provided directly or indirectly by any Group Member or otherwise.

“ Spread Amount ” shall mean 5.00% per annum.

“ Stockholders Agreement ” shall mean Stockholders Agreement, dated as of July 10,2009, among the US Borrower, the Treasury, 7176384 Canada Inc. and the VEBA.

 

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“ Structured Financing ” shall mean Indebtedness (including any Sale/Leaseback Transaction) issued or incurred by any Structured Financing Subsidiary.

“ Structured Financing Subsidiary ” shall mean any Financing Subsidiary or Securitization Subsidiary.

“ Subsidiary ” shall mean, with respect to any Person, any corporation, limited liability company, partnership or other entity of which at least a majority of the securities or other ownership interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other persons performing similar functions of such corporation, partnership or other entity (irrespective of whether or not at the time securities or other ownership interests of any other class or classes of such corporation, partnership or other entity shall have or shall have the right to have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned or controlled by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person. Unless otherwise qualified, all references to a “ Subsidiary ” or “ Subsidiaries ” in this Loan Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.

“ Subsidiary Guarantors ” shall mean collectively: 1908 Holdings, Parkwood Holdings Ltd., GM Overseas Funding LLC; and Subsidiary Guarantor means any one of them.

“ Supplier Receivables Facility ” shall have the meaning set forth in the US Credit Agreement.

“ Swap Agreement ” shall mean any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Borrower or any of its Subsidiaries shall be a “ Swap Agreement .”

“ TARP Covenants ” shall mean the collective reference to the affirmative covenants in sections 7.14, 7.15, 7.16 and 7.25.

“ TARP Covenant Modification ” shall have the meaning set forth in Section 7.27(a).

“ TARP Laws ” shall mean EESA and other laws of the United States adopted pursuant to the Troubled Assets Relief Program.

“ taxes ” shall mean, except as the context otherwise requires, all taxes of any kind or nature whatsoever together with penalties, fines, additions to tax and interest thereon.

“ Technical Information ” shall mean all domestic and foreign trade secrets, ideas, concepts, methods, techniques, processes, proprietary information, technology, know how, formulae, and other general intangibles of like nature now existing or hereafter acquired or owned by the Borrower (including without limitation all domestic and foreign trade secrets, ideas, concepts, methods, techniques, processes, proprietary information, technology, know how, formulae, and other general intangibles of like nature).

 

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“ Technical Information Licenses ” shall mean all licenses, contracts or other agreements, whether written or oral, naming the Borrower as licensee or licensor and providing for the grant of any right to use any Technical Information.

“ Trademark Licenses ” shall mean all licenses, contracts or other agreements, whether written or oral, naming the Borrower or any Subsidiary Guarantor as licensor or licensee and providing for the grant of any right concerning any Trademark, and the right to prepare for sale or lease and sell or lease any and all Inventory now or hereafter owned by the Borrower or any Subsidiary Guarantor and now or hereafter covered by such licenses (including, without limitation, all Trademark Licenses described in Schedule 6.22 hereto).

“ Trademarks ” shall mean all domestic and foreign trademarks, service marks, collective marks, certification marks, trade dress, trade names, business names, d/b/a’s, Internet domain names, trade styles, designs, logos and other source or business identifiers and all general intangibles of like nature, now or hereafter owned, adopted or acquired by the Borrower or any Subsidiary Guarantor (including, without limitation, all domestic and foreign trademarks, service marks, collective marks, certification marks, trade dress, trade names, business names, d/b/a’s, Internet domain names, trade styles, designs, logos and other source or business identifiers described in Schedule 6.22 hereto), all applications, registrations and recordings thereof (including, without limitation, applications, registrations and recordings in the Canadian Intellectual Property Office or in any similar office or agency in any other country or any political subdivision thereof), and all reissues, extensions or renewals thereof, together with all goodwill of the business symbolized by such marks.

“ Transaction Documents ” shall mean each of, and collectively, (i) the Master Transaction Agreement, (ii) the Section 363 Sale Order, (iii) the COCA, (iv) the GMCL Pension Agreement, (v) the Registration Rights Agreement, (vi) the Stockholders Agreement, (vii) the Canadian Subscription Agreement, (viii) the United States Subscription Agreement, (ix) Health Care Trust Agreement, and (x) the related manufacturing agreements, asset purchase agreements, organizational documents, finance support agreements and all other related documentation, each as amended, supplemented or modified from time to time.

“ Treasury ” shall mean The United States Department of the Treasury.

“ Treasury Rejection Notice ” shall mean a notice from the Treasury to the US Borrower rejecting a mandatory prepayment arising under Section 2.5(a) of the US Credit Agreement following the initial offer to repay the loans thereunder in accordance with Section 2.5(g) of the US Credit Agreement.

“ Uniform Commercial Code ” shall mean the Uniform Commercial Code as in effect from time to time in the State of New York; provided that if by reason of mandatory provisions of law, the perfection or the effect of perfection or non-perfection of the security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than New York, “ Uniform Commercial Code ” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or effect of perfection or non-perfection.

 

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“ United States ” or “ U.S. ” shall mean the United States of America.

“ United States Dollars ” or “ US$ ” shall mean lawful currency of the United States of America.

“ United States Subscription Agreement ” shall mean that certain United States Contribution & Subscription Agreement, in substantially the form annexed to the Additional Canadian Facilities Term Sheet.

“ US Bankruptcy Case ” shall mean the case under Chapter 11 of the Bankruptcy Code relating to the US Borrower.

“ US Borrower ” shall mean General Motors Company, formerly NGMCO, Inc., a Delaware corporation and successor in interest to Vehicle Acquisition Holdings LLC, a Delaware limited liability company, which is the direct or indirect parent of the Borrower.

“ US Collateral ” shall have the meaning given to the term “ Collateral ” set forth in the US Credit Agreement.

“ US Credit Agreement ” shall mean the First Lien Credit Agreement dated as of July 10, 2009 among the US Borrower, the guarantors thereunder and the Treasury, as the same may be amended, restated, supplemented or modified from time to time.

“ US Dollar Equivalent ” shall mean, on any date of determination, with respect to any amounts denominated in Canadian Dollars, the equivalent in US Dollars of such amount as determined by the Lender in accordance with normal banking industry practice using the Exchange Rate on the date of determination.

“ US Parent Guarantor ” shall mean any parent entity of the US Borrower which becomes a guarantor under the US Credit Agreement.

“ VEBA ” shall have the meaning set forth in the US Credit Agreement.

“ VEBA Note Facility ” shall have the meaning set forth in the US Credit Agreement.

“ VEBA Rejection Notice ” shall mean a notice from the VEBA to the US Borrower rejecting a mandatory prepayment arising under Section 2.5(a) of the VEBA Note Facility following the initial offer to prepay the notes thereunder in accordance with Section 2.5(g) of the VEBA Note Facility.

“ Wholly Owned Subsidiary ” shall mean as to any Person, any other Person all of the Equity Interests of which (other than directors’ qualifying shares required by law) is owned by such Person directly and/or through other Wholly Owned Subsidiaries.

1.02 Interpretation. The following rules of this Section 1.02 apply unless the context requires otherwise. A gender includes all genders. Where a word or phrase is defined, its other grammatical forms have a corresponding meaning. A reference to a subsection, Section, Appendix, Annex or Exhibit is, unless otherwise specified, a reference to a Section of, or annex or exhibit to, this Loan Agreement. A reference to a party to this Loan Agreement or another

 

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agreement or document includes the party’s successors and permitted substitutes or assigns. A reference to an agreement or document (including any Loan Document) is to the agreement or document as amended, restated, modified, novated, supplemented or replaced, except to the extent prohibited thereby or by any Loan Document and in effect from time to time in accordance with the terms thereof. References to any statute shall be to such statute as amended or modified from time to time and to any successor legislation thereto, in each case as in effect at the time any such reference is operative. A reference to writing includes a facsimile transmission and any means of reproducing words in a tangible and permanently visible form. A reference to conduct includes, without limitation, an omission, statement or undertaking, whether or not in writing. The words “hereof”, “herein”, “hereunder” and similar words refer to this Loan Agreement as a whole and not to any particular provision of this Loan Agreement. The term “including” is not limiting and means “including without limitation”. In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including”, the words “to” and “until” each mean “to but excluding”, and the word “through” means “to and including”. Whenever any provision in any Loan Document refers to the knowledge (or an analogous phrase) of such Person, such words are intended to signify that a member of the board of directors, President, Chief Financial Officer or General Counsel of such Person has actual knowledge or awareness of a particular fact or circumstance or that such Person, if it had exercised reasonable diligence, would have known or been aware of such fact or circumstance.

Except where otherwise provided in this Loan Agreement, any determination, consent, approval, statement or certificate made or confirmed in writing with notice to the Borrower by the Lender or an authorized officer of the Lender provided for in this Loan Agreement is conclusive and binds the parties in the absence of manifest error. A reference to an agreement includes a security interest, guarantee, agreement or legally enforceable arrangement whether or not in writing related to such agreement.

A reference to a document includes an agreement (as so defined) in writing or a certificate, notice, instrument or document, or any information recorded in computer disk form. Where a Loan Party is required to provide any document to the Lender under the terms of this Loan Agreement, the relevant document shall be provided in writing or printed form unless the Lender requests otherwise. At the request of the Lender, the document shall be provided in computer disk form or both printed and computer disk form.

This Loan Agreement is the result of negotiations among, and has been reviewed by counsel to, the Lender and the Loan Parties, and is the product of all parties. In the interpretation of this Loan Agreement, no rule of construction shall apply to disadvantage one party on the ground that such party proposed or was involved in the preparation of any particular provision of this Loan Agreement or this Loan Agreement itself. Except where otherwise expressly stated, the Lender may give or withhold, or give conditionally, approvals and consents and may form opinions and make determinations at its absolute discretion. Any requirement of good faith, discretion or judgment by the Lender shall not be construed to require the Lender to request or await receipt of information or documentation not immediately available from or with respect to the Borrower, any other Loan Party, any other Person, or the Collateral themselves.

The parties hereto agree that the terms “ Senior Lien ”, “ Senior Lien Lender ”, “ Senior Lien Loan Agreements ”, “ Special Interest Notes ” and “ Permitted Dispositions ” are

 

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intentionally deleted from this Loan Agreement, and to the extent such terms are used or referenced in a Loan Document, such terms shall be deemed to be deleted from such Loan Document and such Loan Document shall be interpreted without regard to such term.

For purposes of this Loan Agreement and the other Loan Documents, with respect to any monetary amounts in a currency other than Canadian Dollars, the US Dollar Equivalent thereof shall be determined based on the Exchange Rate in effect at the time of such determination (unless otherwise explicitly provided herein).

1.03 Accounting Terms and Determinations. Except as otherwise expressly provided herein, all accounting terms used herein shall be interpreted, and all financial statements and certificates and reports as to financial matters required to be delivered to the Lender hereunder shall be prepared, in accordance with GAAP; provided the financial statements required to be delivered by the Borrower need not be prepared in accordance with GAAP.

SECTION 2. LOAN, NOTES AND PAYMENTS.

2.01 Loan. The Borrower hereby acknowledges that it is indebted to the Lender in respect of the Remaining Existing Loan Agreement Advances in the aggregate principal amount of CDN$1,497,071,186, being the Canadian Dollar Equivalent of US$1,288,135,593 (the “ Loan ”), calculated on the day before the Effective Date. Any portion of the Loan which is repaid or prepaid may not be reborrowed.

2.02 Notes. The Borrower shall execute and deliver the Initial Note (the “ Initial Note ”) on the Effective Date. Following any assignment or transfer of the Loan pursuant to Section 12.15, the Borrower agrees that, upon the request of the Lender, the Borrower shall promptly execute and deliver to the Lender replacement Notes reflecting the portion of the Loan assigned or transferred and the portion of the Loan retained by the Lender, if any.

2.03 [Reserved].

2.04 Inability to Determine Interest Rate; Illegality. Anything herein to the contrary notwithstanding, if, on or prior to the determination of CDOR Rate:

(a) the Lender determines, which determination shall be conclusive, that quotations of rates for banker acceptances’ referred to in the definition of “ CDOR Rate ” in Section 1.01 hereof are not being provided in the relevant amounts or for the relevant maturities for purposes of determining rates of interest for the Loan as provided herein; or

(b) the Lender determines, which determination shall be conclusive, that the Spread Amount plus the relevant rate of interest referred to in the definition of “ CDOR Rate ” in Section 1.01 hereof upon the basis of which the rate of interest for the Loan is to be determined is not likely adequately to cover the cost to the Lender of making or maintaining the Loan; or

(c) it becomes unlawful for the Lender to make or maintain the Loan hereunder using CDOR Rate; then the Lender shall give the Borrower prompt notice thereof and, so long as such condition remains in effect, the Borrower shall pay interest on the outstanding Loan at a rate per annum as determined by the Lender taking into account the cost to the Lender of making and maintaining the Loan.

 

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2.05 Repayment of the Loan; Interest.

(a) On the Maturity Date, the Borrower shall repay to the Lender the principal amount of the Loan, together with all interest thereon accruing under this Loan Agreement.

(b) The Loan shall bear interest on the unpaid principal amount thereof at a rate per annum equal to the CDOR Rate plus the Spread Amount, payable in arrears (i) on each Interest Payment Date in respect of the previous Interest Period, (ii) on the Maturity Date and (iii) on payment or prepayment of the Loan in whole or in part, in the amount of interest accrued on the amount paid or prepaid, provided that interest accruing pursuant to paragraphs (c) or (d) of this section shall be payable from time to time on demand and, if not paid, shall be compounded annually on the last calendar day of each year.

(c) If all or a portion of the Loan, any interest payable on the Loan or any fee or other amount payable hereunder shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall bear interest at a rate per annum equal to the Post-Default Rate, in each case from the date of such non-payment until such amount is paid in full (as well after as before judgment).

(d) Upon the occurrence and continuance of any Default or Event of Default, at the option of the Lender, the Loan, any fee or other amount payable hereunder shall bear interest at a rate per annum equal to the Post-Default Rate, in each case from the date of such Default or Event of Default until such amount is paid in full (as well after as before judgment).

(e) [Reserved]

(f) For purposes of disclosure pursuant to the Interest Act (Canada), the annual rates of interest or fees to which the rates of interest or fees provided in this Loan Agreement and the other Loan Documents (and stated herein or therein, as applicable, to be computed on the basis of a 365 or 366 (as the case may be) day year or any other period of time less than a calendar year) are equivalent are the rates so determined multiplied by the actual number of days in the applicable calendar year and divided by 365 or 366 (as the case may be) or such other period of time.

(g) If any provision of this Loan Agreement or of any of the other Loan Documents would obligate the Borrower, any other Loan Party or any Guarantor to make any payment of interest or any other amount payable to the Lender, the Government of Canada, or the Government of Ontario (each a “ Recipient ”) in an amount or calculated at a rate which would be prohibited by law or would result in a receipt by the Recipient of interest at a criminal rate (as such terms are construed under the Criminal Code (Canada)) then, notwithstanding such provisions, such amount or rate shall be deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by law or so result in a receipt by such Recipient of interest at a criminal rate, such adjustment to be effected, to the extent necessary, as follows: (1) firstly, by reducing the amount or rate of interest required to be paid to such Recipient under this Loan Agreement and the other Loan Documents, and (2) thereafter, by reducing any fees, commissions, premiums and other amounts required to be paid to such Recipient which would constitute “ interest ” for purposes of Section 347 of the Criminal Code (Canada). Notwithstanding the foregoing, and after giving effect to all

 

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adjustments contemplated thereby, if a Recipient shall have received an amount in excess of the maximum permitted by Applicable Law or that section of the Criminal Code (Canada), the Borrower shall be entitled, by notice in writing to such Recipient, to obtain reimbursement from such Recipient in an amount equal to such excess and, pending such reimbursement, such amount shall be deemed to be an amount payable by such Recipient to Borrower. Any amount or rate of interest referred to in this Section 2.05(g) shall be determined in accordance with generally accepted actuarial practices and principles as an effective annual rate of interest over the term that the loan remains outstanding on the assumption that any charges, fees or expenses that fall within the meaning of “ interest ” (as defined in the Criminal Code (Canada)) shall, if they relate to a specific period of time, be pro-rated over that period of time and otherwise be pro-rated over the period from date of this Loan Agreement to the Maturity Date and, in the event of a dispute, a certificate of a Fellow of the Canadian Institute of Actuaries appointed by the Lender shall be conclusive for the purposes of such determination.

2.06 Optional Prepayments.

(a) The Loan is prepayable without premium or penalty, in whole or in part at any time, in accordance herewith and subject to clause (b) below. Amounts repaid may not be reborrowed. If the Borrower intends to prepay the Loan in whole or in part from any source, the Borrower shall give five (5) Business Days’ prior written notice thereof to the Lender. If such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with accrued interest to such date on the amount prepaid. Partial prepayments shall be in an aggregate principal amount of at least CDN$20,000,000 and in integral multiples of CDN$20,000,000 thereafter.

(b) In connection with each prepayment, other than on an Interest Payment Date, the Borrower shall indemnify the Lender and hold the Lender harmless from any actual loss or expense which the Lender may sustain or incur arising from (i) the re-employment of funds obtained by the Lender to maintain the Loan hereunder or (ii) fees payable to terminate the deposits from which such funds were obtained, in either case, which actual loss or expense shall be equal to an amount equal to the excess, as reasonably determined by the Lender, of (x) its cost of obtaining funds for the Loan for the period from the date of such payment through the next Interest Payment Date over (y) the amount of interest likely to be realized by the Lender in redeploying the funds not utilized by reason of such payment for such period. This Section 2.06 shall survive termination of this Loan Agreement and payment of the Notes.

(c) Notwithstanding the Borrower’s right to prepay the Loan pursuant to this Section 2.06, in no event will the Lender’s Lien on any of the Facility Collateral be released upon any such prepayment until payment in full of the Loan and the satisfaction of all other Obligations, except as provided in Sections 2.07 or 4.05.

2.07 Mandatory Prepayments.

(a) The Borrower shall be obliged to make the following prepayments of the Loan (each a “ Mandatory Prepayment ”):

(i) If any Additional First Lien Indebtedness or Permitted Unsecured Indebtedness is incurred by any Group Member other than an Excluded Subsidiary, then promptly upon such incurrence (and in any case not more than twenty (20) Business Days

 

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thereafter), the Loans shall be prepaid by an amount equal to the Applicable Net Cash Proceeds of such incurrence, as set forth in Section 2.07(c). If any amount in respect of Attributable Obligations under a Sale/Leaseback Transaction is required to be applied as a prepayment of the Loans pursuant to clause (1) of the definition of “ Permitted Indebtedness ,” then promptly upon the occurrence of such Sale/Leaseback Transaction (and in any case not more than twenty Business Days thereafter), the Loans shall be prepaid by an amount equal to the Applicable Net Cash Proceeds of such Sale/Leaseback Transaction, as set forth in Section 2.07(c). With respect to any such Indebtedness incurred by a Foreign Subsidiary, the aggregate amount of the Applicable Net Cash Proceeds thereof required to be applied pursuant to Section 2.07(c) to the prepayment of the Loan shall be subject to reduction to the extent that expatriation of such Applicable Net Cash Proceeds (i) would result in material adverse tax or legal consequences (including, without limitation, violation of Contractual Obligations), (ii) would be reasonably likely to result in adverse personal liability of any director of any Group Member, or (iii) would result in the insolvency of the applicable Foreign Subsidiary. The provisions of this Section 2.07(a)(i) do not constitute a consent to the incurrence of any Indebtedness by any Group Member to which consent is otherwise required under this Loan Agreement or the other Loan Documents. Notwithstanding the foregoing, no prepayment shall be required under this Section 2.07(a)(i) if (A) the aggregate principal amount of Indebtedness and any Attributable Obligations incurred by the applicable Group Member on the date of incurrence does not exceed US$5,000,000, or (B) the Indebtedness was incurred or issued by a Foreign Subsidiary, General Motors China, Inc. or GM APO Holdings LLC solely for the purpose of funding operations outside the United States and Canada.

(ii) If on any date the Borrower or any Subsidiary Guarantor shall receive Net Cash Proceeds from any Asset Sale, Recovery Event or Extraordinary Receipt, then unless a Reinvestment Notice shall be delivered in respect of any Asset Sale or Recovery Event, promptly upon receipt of such Net Cash Proceeds (and in any case not more than twenty (20) Business Days thereafter), the Loan shall be prepaid by an amount equal to the amount of such Net Cash Proceeds, as set forth in Section 2.07(c); provided that, on each Reinvestment Prepayment Date, the Loans shall be prepaid by an amount equal to the Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event, as set forth in Section 2.07(c). With respect to any Net Cash Proceeds realized or received by an applicable Foreign Subsidiary in connection with any Asset Sale, Recovery Event or Extraordinary Receipt, the aggregate amount of such Net Cash Proceeds required to be applied pursuant to this Section 2.07(a)(ii) to the prepayment of the Loan shall be subject to reduction to the extent that expatriation of such Net Cash Proceeds (i) would result in material adverse tax or legal consequences (including, without limitation, violation of Contractual Obligations), (ii) would be reasonably likely to result in adverse personal liability of any director of any applicable Group Member, or (iii) would result in the insolvency of the applicable Foreign Subsidiary. The provisions of this Section 2.07(a)(ii) do not constitute a consent to the consummation of any Disposition not permitted by Section 8.10.

(b) Notwithstanding the foregoing provisions of paragraph (a)(ii) above with respect to Asset Sales resulting from, as applicable, (1) the sale of the Borrower’s interest in any of Hummer, AC Delco, Saab, Saturn or OnStar, or (2) the sale of any of the properties known as the Oshawa Truck Plant, Windsor Transmission Plant, St. Catharines Powertrain Ontario Street Facility, the Queensway Dealership Properties, the Edmonton, Woodstock parts distribution warehouses, Mandatory Prepayment of the Net Cash Proceeds shall not be required to the extent the Lender agrees that such Net Cash Proceeds may be retained by the Borrower for the purpose of implementing a business plan approved by the Lender.

 

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(c) Amounts to be applied in connection with prepayments made pursuant to Section 2.06 and this Section 2.07 shall be applied, (i) first, to pay accrued and unpaid interest in respect of the Loans and all other Obligations then due and payable other than principal under the Loans, and (ii) second, to repay the Loans. Any such prepayment shall be accompanied by a notice to the Lender specifying the amount of such prepayment.

(d) Notwithstanding anything to the contrary in Section 2.07(c), with respect to the amount of any mandatory prepayment required to be made pursuant to Section 2.07(a)(i) or (ii), as applicable (the “ Mandatory Prepayment Amount ”), at any time when EDC is a Lender hereunder, the Borrower may, in lieu of applying EDC’s Percentage of such amount to the Mandatory Prepayment of the Loan of EDC as provided in Section 2.07(c), on the date specified in Section 2.07(a)(i) or (ii), as applicable (the “ Offer Date ”), for such Mandatory Prepayment, deliver a written offer to EDC to permit EDC to decline all or a portion of such Mandatory Prepayment; provided that, the Borrower shall pay to each Lender other than EDC such Lender’s pro rata share of such Mandatory Prepayment as otherwise required by Section 2.07(a)(i) or (ii), as applicable. If, no later than five (5) Business Days following the Offer Date (the “ Mandatory Prepayment Date ”), (i) EDC and the Borrower have mutually agreed, EDC may deliver a written notice to reject (an “ EDC Rejection Notice ”) all or a portion of the applicable Mandatory Prepayment Amount (such rejected amount, the “ Rejected Prepayment Amount ”), in which case the Borrower may retain the Rejected Prepayment Amount, and (ii) otherwise, the Loan of EDC shall be repaid on the Mandatory Prepayment Date, together with all accrued and unpaid interest thereon. For avoidance of doubt, EDC is the sole Lender that may reject a Mandatory Prepayment pursuant to this Section 2.07(d) and such right shall not be available to any other Lender.

(e) If on any date, the Borrower or the US Borrower shall have received a Treasury Rejection Notice or a VEBA Rejection Notice, the Borrower shall at any time when EDC is a Lender hereunder, deliver a written offer to EDC to prepay on the date that is five (5) Business Days after the date of the Treasury Rejection Notice or the VEBA Rejection Notice, as applicable, the Loan held by EDC by an amount equal to the Applicable Rejected Prepayment Amount. EDC may, in its sole discretion, elect to reject all or a portion of such Applicable Rejected Prepayment Amount. Any amounts rejected by EDC following any offer pursuant to this Section 2.07(e) may be retained by the Borrower provided that, the Borrower may not use any portion of any Applicable Rejected Prepayment Amount to make an optional prepayment pursuant to Section 2.06. For the avoidance of doubt, EDC is the sole Lender that shall be offered, and shall have the right to reject, any Applicable Rejected Prepayment Amount.

(f) Notwithstanding anything to the contrary set forth herein, the Borrower shall not be required to make an offer to EDC pursuant to this Section 2.07 in excess of the outstanding principal balance of the EDC’s Loans.

(g) Notwithstanding anything to the contrary in the Loan Documents, if, on June 30, 2010 any funds remain on deposit in the Escrow Account (as defined in the US Credit Agreement), the Borrower shall apply an amount equal to 16.102% of such funds to the prepayment of the Loan as set forth in Section 2.07(c), provided that, the Borrower may request that the date on which all or a portion of such funds shall be applied to such prepayment be extended to a date not later than June 30, 2011, which may be consented to by the Treasury in its sole discretion.

 

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2.08 Requirements of Law.

(a) If any Requirement of Law (other than with respect to any amendment made to the Lender’s certificate of incorporation, by laws or other organizational or governing documents) or any change in the interpretation or application thereof or compliance by the Lender with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof:

(i) shall subject the Lender to any tax of any kind whatsoever with respect to this Loan Agreement, the Notes, or the Loan or change the basis of taxation of payments to the Lender in respect thereof (provided that, this clause (i) shall not apply to any withholding taxes or taxes covered by Section 3.03);

(ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory advance or similar requirement or otherwise impose any cost on the Lender in connection with funding or maintaining the Loan or other extensions of credit, which is not otherwise included in the determination of CDOR Rate hereunder;

(iii) shall impose on the Lender any other condition;

(iv) and the result of any of the foregoing is to increase the cost to the Lender, by an amount which the Lender deems to be material, of making, continuing or maintaining the Loan or to reduce any amount receivable hereunder in respect thereof, then, in any such case, the Borrower shall promptly pay the Lender such additional amount or amounts as will compensate the Lender for such increased cost or reduced amount receivable thereafter incurred.

(b) If the Lender shall have determined in its sole discretion that the adoption of or any change in any Requirement of Law (other than with respect to any amendment made to the Lender’s certificate of incorporation, by-laws or other organizational or governing documents) regarding capital adequacy or in the interpretation or application thereof or compliance by the Lender or any Person controlling the Lender with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof shall have the effect of reducing the rate of return on the Lender’s or such Person’s capital as a consequence of any obligations hereunder to a level below that which the Lender or such Person (taking into consideration the Lender’s or such Person’s policies with respect to capital adequacy) by an amount deemed by the Lender to be material, then from time to time, the Borrower shall promptly pay to the Lender such additional amount or amounts as will thereafter compensate the Lender for such reduction.

(c) If the Lender becomes entitled to claim any additional amounts pursuant to this subsection, it shall promptly notify the Borrower of the event by reason of which it has become so entitled. A certificate as to any additional amounts payable pursuant to this subsection submitted by the Lender to the Borrower shall be conclusive in the absence of manifest error.

 

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2.09 [ Reserved ].

2.10 Funding Indemnity. Upon demand of the Lender from time to time, the Borrower shall promptly compensate the Lender for and hold the Lender harmless from any loss, cost or expense incurred by the Lender as a result of any failure by the Borrower to prepay the Loan on the date or in the amount notified by the Borrower, including, any loss of anticipated profits and any loss or expense arising from the liquidation or reemployment of funds obtained by the Lender to maintain the Loan or from fees payable to terminate the deposits from which such funds were obtained. The Lender shall provide the Borrower with a notice setting forth in reasonable detail the basis for the Lender’s demand, which shall be conclusive absent manifest error. The Borrower shall pay such amount within ten (10) calendar days after receipt of such notice. This Section 2.10 shall survive the payment in full of the Obligations and the termination of the Loan Documents.

2.11 Receipt of Payment. If the Lender receives from or on behalf of any Loan Party any amount under this Loan Agreement or any other Loan Document in a currency other than the currency in which the Obligations are denominated (the “ Obligation Currency ”), including by way of enforcement upon Collateral, the Lender is hereby authorized to, and may, convert such currency into the Obligation Currency for application to the Obligations in accordance with this Loan Agreement. The Obligations shall be satisfied only to the extent of the amount of the Obligation Currency received by the Lender from such conversion of the Obligations and only as of the date on which such conversion is completed. Notwithstanding the foregoing, the Lender has no obligation to accept payment in a currency other than the Obligation Currency.

2.12 Judgment Currency. Without limiting and in addition to Section 2.11, if for the purposes of obtaining judgment in any court in any jurisdiction with respect to this Loan Agreement or any other Loan Document to which any Loan Party is party it becomes necessary to convert into the currency of such jurisdiction (herein called the “ Judgment Currency ”) any amount due hereunder in any currency other than the Judgment Currency, then conversion shall be made at the rate of exchange prevailing on the Business Day before the day on which judgment is given. For this purpose, “ rate of exchange ” means the average rate at which the Reference Banks would, on the relevant date at or about 12:00 noon (Ottawa, Ontario, Canada time), be prepared to sell a similar amount of such currency in Toronto, Ontario, Canada against the Judgment Currency. In the event that there is a change in the rate of exchange prevailing between the Business Day before the day on which the judgment is given and the date of payment of the amount due, the Loan Party will, on the date of payment, pay such additional amounts (if any) as may be necessary to ensure that the amount paid on such date is the amount in the Judgment Currency which when converted at the rate of exchange prevailing on the date of payment is the amount then due under this Loan Agreement or such other applicable Loan Document in such other currency. Any additional amount due from any Loan Party under this section will be due as a separate debt and shall not be affected by judgment being obtained for any other sums due under or in respect of any of the Loan Documents.

SECTION 3. PAYMENTS; COMPUTATIONS: TAXES.

3.01 Payments. Except to the extent otherwise provided herein, all payments of principal, interest and other amounts to be made by the Borrower under the Loan Documents, shall be made in Canadian Dollars, in immediately available funds, without deduction, set-off or counterclaim, to the Lender at the account set forth below not later than 5:00 p.m. (Ottawa,

 

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Ontario, Canada time), on the date on which such payment shall be due. Any amounts received after such time on any date may, in the discretion of the Lender, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. The Borrower acknowledges that it has no rights of withdrawal from the aforementioned account.

All payments should be made to the following account maintained by the Lender:

***

Indicates that text has been omitted which is the subject of a confidential treatment request. This text is separately filed with the Securities and Exchange Commission.

3.02 Computations. Interest on the Loan shall be computed on the basis of a 365 day year for the actual days elapsed (including the first day but excluding the last day) occurring in the period for which payable.

3.03 Taxes.

(a) Except as required by Applicable Law, all payments made by the Borrower under this Loan Agreement or any other Loan Document shall be made free and clear of, and without deduction or withholding for or on account of, any present or future taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, excluding net or overall gross income taxes or net or overall gross profit taxes, franchise taxes (imposed in lieu of net or overall gross income taxes), capital taxes and branch profit taxes imposed on the Lender as a result of a present or former connection between the Lender and the jurisdiction of the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from the Lender’s having executed, delivered or performed its obligations or received a payment under, or enforced, this Loan Agreement or any other Loan Document). If any such non-excluded taxes (such taxes, excluding Excluded Taxes, the “ Non-Excluded Taxes ”) are required to be withheld from any amounts payable by the Borrower to the Lender hereunder, the amounts so payable to the Lender shall be increased so that after making or allowing for all such required withholdings (including withholdings applicable to additional amounts payable under this Section 3.03) the Lender receives an amount equal to the sum it would have received had no such withholdings been required; provided , however , that the Borrower shall not be required to increase any such amounts payable to the Lender with respect to any Non-Excluded Taxes that are (i) attributable to the Lender’s failure to comply with the requirements of paragraph (d) of this Section 3.03, (ii) taxes imposed by way of withholding on net or gross income, but not excluding such taxes arising as a result of a change in Applicable Law occurring after (A) the date that the Lender became a party to this Loan Agreement (unless after that date the Lender has designated a new lending office, in which case sub-clause (C) below shall apply), or (B) with respect to an assignment, acquisition or grant of a participation, the effective date of such assignment, acquisition or participation, except to the

 

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extent that the Lender’s predecessor was entitled to such amounts, or (C) with respect to the designation of a new lending office, the effective date of such designation, except to the extent the Lender was entitled to receive such amounts with respect to its previous lending office, and (iii) taxes resulting from the Lender’s gross negligence or willful misconduct (collectively, and together with the taxes excluded by the first sentence of this Section 3.03, “Excluded Taxes”).

(b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with Applicable Law.

(c) Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower, as promptly as possible thereafter, the Borrower shall send to the Lender, a certified copy of an original official receipt received by the Borrower showing payment thereof (or if an official receipt is not available, such other evidence of payment as shall be reasonably satisfactory to such Lender). If the Borrower fails to pay any Non-Excluded Taxes or Other Taxes required to be paid by the Borrower under this Section when due to the appropriate taxing authority or fails to remit to the Lender the required receipts or other required documentary evidence, the Borrower shall indemnify the Lender and hold the Lender harmless against any such Non-Excluded Taxes or Other Taxes and for any incremental taxes, interest or penalties that may become payable by the Lender as a result of any such failure to remit or pay. The agreements in this Section shall survive the termination of this Loan Agreement and the payment of the Loan and all other amounts payable hereunder.

(d) If the Lender is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Loan Agreement then the Lender shall deliver to the Borrower, at the time or times prescribed by Applicable Law or reasonably requested by the Borrower, such properly completed and executed documentation as will permit such payments to be made without withholding or at a reduced rate, provided that the Lender is legally entitled to complete, execute and deliver such documentation and in the Lender’s reasonable judgment such completion, execution or submission would not materially prejudice the legal position of the Lender.

(e) If the Lender determines that it has received a refund, credit, or other reduction of taxes in respect of any Non-Excluded Taxes or Other Taxes paid by the Borrower, as to which it has been indemnified by the Borrower, or with respect to which the Borrower has paid additional amounts pursuant to this Section 3.03, the Lender shall within sixty (60) days from the date of actual receipt of such refund or the filing of the tax return in which such credit or other reduction results in a lower tax payment, pay over such refund or the amount of such tax reduction to the Borrower (but only to the extent of such Non-Excluded Taxes or Other Taxes paid by the Borrower, indemnity payments made by the Borrower with respect to such Non-Excluded Taxes or Other Taxes, or additional amounts paid by the Borrower with respect to such Non-Excluded Taxes or Other Taxes, as applicable), net of all out of pocket expenses of the Lender, and without interest (other than interest paid by the relevant Governmental Authority with respect to such refund). Notwithstanding anything to the contrary in this Loan Agreement, upon the request of the Lender, the Borrower agrees to repay any amount paid over to the Borrower pursuant to the immediately preceding sentence (plus penalties, interest, or other charges) if the Lender is required to repay such amount to the taxing Governmental Authority.

 

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(f) If on a payment of interest due prior to 2010 from the Borrower to a Lender that is an Affiliate of the Borrower and a resident of the United States for the purposes of the Canada-United States Income Tax Convention (1980), the Borrower would otherwise be liable to pay additional amounts thereon pursuant to this Section 3.03, then the Borrower shall be entitled to postpone and defer payment of such interest to such Lender until the first Business Day of January 2010.

SECTION 4. CERTAIN COLLATERAL PROVISIONS.

4.01 Changes in Locations, Name. etc. If any Loan Party (i) changes the location of its chief executive office/chief place of business from that specified in Section 6.09 hereof, (ii) changes its name, identity or corporate structure (or the equivalent) or changes the location where it maintains records with respect to the Collateral, or (iii) reincorporates or reorganizes under the laws of another jurisdiction, it shall give the Lender written notice thereof not later than ten (10) calendar days after such event occurs, and shall deliver to the Lender all Uniform Commercial Code (if applicable) and Personal Property Security Act financing statements and amendments as the Lender shall request and take all other actions deemed reasonably necessary by the Lender to continue its perfected status in the Collateral with the same or better priority.

4.02 Performance by the Lender of the Borrower’s Obligations. If the Borrower or any Subsidiary Guarantor fails to perform or comply with any of its obligations contained in the Loan Documents, the Lender may itself perform or comply, or otherwise cause performance or compliance, with such obligations and the reasonable out-of-pocket expenses of the Lender incurred in connection with such performance or compliance, together with interest thereon at a rate per annum equal to the Post-Default Rate, shall be payable by the Borrower or any Subsidiary Guarantor to the Lender on demand and shall constitute Obligations.

4.03 Proceeds. If an Event of Default shall occur and be continuing, (a) all proceeds of collateral received by the Borrower or any Subsidiary Guarantor consisting of cash, checks and Cash Equivalents shall be held by the Borrower or any Subsidiary Guarantor in trust for the Lender, segregated from other funds of the Borrower or any Subsidiary Guarantor, and shall forthwith upon receipt by the Borrower or any Subsidiary Guarantor be turned over to the Lender in the exact form received by the Borrower or any such Subsidiary Guarantor (duly endorsed by the Borrower or any Subsidiary Guarantor to the Lender, if required), and (b) any and