Exhibit 10.2
EXECUTION COPY
$960,000,000
CREDIT AGREEMENT
dated as of July 6, 2007,
among
NOVELIS INC.,
as Canadian Borrower,
NOVELIS CORPORATION
as U.S. Borrower,
AV ALUMINUM INC.,
as Holdings,
and
THE OTHER GUARANTORS PARTY HERETO,
THE LENDERS PARTY HERETO,
UBS AG, STAMFORD BRANCH,
as Administrative Agent and as Collateral Agent,
UBS SECURITIES LLC,
as Syndication Agent,
ABN AMRO INCORPORATED,
as Documentation Agent,
and
UBS SECURITIES LLC,
ABN AMRO INCORPORATED,
as Joint Lead Arrangers and Joint Bookmanagers
 

 

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TABLE OF CONTENTS

                      Page  
 
            ARTICLE I. DEFINITIONS     2  
 
           
SECTION 1.01
  Defined Terms     2  
SECTION 1.02
  Classification of Loans and Borrowings     52  
SECTION 1.03
  Terms Generally; Currency Translation     52  
SECTION 1.04
  Accounting Terms; GAAP     53  
SECTION 1.05
  Resolution of Drafting Ambiguities     53  
 
            ARTICLE II. THE CREDITS     54  
 
           
SECTION 2.01
  Commitments     54  
SECTION 2.02
  Loans     54  
SECTION 2.03
  Borrowing Procedure     55  
SECTION 2.04
  Repayment of Loans; Evidence of Debt     56  
SECTION 2.05
  Fees     57  
SECTION 2.06
  Interest on Loans     57  
SECTION 2.07
  Termination of Commitments     58  
SECTION 2.08
  Interest Elections     58  
SECTION 2.09
  Amortization of Term Loan Borrowings     60  
SECTION 2.10
  Optional and Mandatory Prepayments of Loans     60  
SECTION 2.11
  Alternate Rate of Interest     65  
SECTION 2.12
  Yield Protection; Change in Law Generally     66  
SECTION 2.13
  Breakage Payments     67  
SECTION 2.14
  Payments Generally; Pro Rata Treatment; Sharing of Setoffs     68  
SECTION 2.15
  Taxes     70  
SECTION 2.16
  Mitigation Obligations; Replacement of Lenders     72  
SECTION 2.17
  [INTENTIONALLY OMITTED]     74  
SECTION 2.18
  [INTENTIONALLY OMITTED]     74  
SECTION 2.19
  Interest Act (Canada); Criminal Rate of Interest; Nominal Rate of Interest    
74  
SECTION 2.20
  [INTENTIONALLY OMITTED]     75  
SECTION 2.21
  [INTENTIONALLY OMITTED]     75  
SECTION 2.22
  [INTENTIONALLY OMITTED]     75  
SECTION 2.23
  Incremental Term Loan Commitments     75  
 
            ARTICLE III. REPRESENTATIONS AND WARRANTIES     77  
 
           
SECTION 3.01
  Organization; Powers     77  
SECTION 3.02
  Authorization; Enforceability     77  
SECTION 3.03
  No Conflicts     78  
SECTION 3.04
  Financial Statements; Projections     78  
SECTION 3.05
  Properties     79  
SECTION 3.06
  Intellectual Property     80  

 

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                      Page  
 
           
SECTION 3.07
  Equity Interests and Subsidiaries     80  
SECTION 3.08
  Litigation; Compliance with Laws     81  
SECTION 3.09
  Agreements     81  
SECTION 3.10
  Federal Reserve Regulations     82  
SECTION 3.11
  Investment Company Act     82  
SECTION 3.12
  Use of Proceeds     82  
SECTION 3.13
  Taxes     82  
SECTION 3.14
  No Material Misstatements     83  
SECTION 3.15
  Labor Matters     83  
SECTION 3.16
  Solvency     83  
SECTION 3.17
  Employee Benefit Plans     84  
SECTION 3.18
  Environmental Matters     84  
SECTION 3.19
  Insurance     86  
SECTION 3.20
  Security Documents     86  
SECTION 3.21
  Acquisition Documents; Material Indebtedness Documents; Representations and
Warranties in Acquisition Agreement     89  
SECTION 3.22
  Anti-Terrorism Law     89  
SECTION 3.23
  [INTENTIONALLY OMITTED]     90  
SECTION 3.24
  Location of Material Inventory and Equipment     90  
SECTION 3.25
  [INTENTIONALLY OMITTED]     90  
SECTION 3.26
  Senior Notes; Material Indebtedness     90  
SECTION 3.27
  Centre of Main Interests and Establishments     90  
SECTION 3.28
  Holding and Dormant Companies     91  
SECTION 3.29
  Hindalco Acquisition     91  
SECTION 3.30
  Excluded Collateral Subsidiaries     91  
SECTION 3.31
  Immaterial Subsidiaries     91  
 
            ARTICLE IV. CONDITIONS TO CREDIT EXTENSIONS     91  
 
           
SECTION 4.01
  Conditions to Initial Credit Extension     91  
SECTION 4.02
  Conditions to Credit Extensions     99  
SECTION 4.03
  Certain Collateral Matters     100  
 
            ARTICLE V. AFFIRMATIVE COVENANTS     100  
 
           
SECTION 5.01
  Financial Statements, Reports, etc.     100  
SECTION 5.02
  Litigation and Other Notices     103  
SECTION 5.03
  Existence; Businesses and Properties     103  
SECTION 5.04
  Insurance     104  
SECTION 5.05
  Payment of Taxes     105  
SECTION 5.06
  Employee Benefits     106  
SECTION 5.07
  Maintaining Records; Access to Properties and Inspections; Annual Meetings    
106  
SECTION 5.08
  Use of Proceeds     107  
SECTION 5.09
  Compliance with Environmental Laws; Environmental Reports     107  
SECTION 5.10
  Interest Rate Protection     107  
SECTION 5.11
  Additional Collateral; Additional Guarantors     108  

 

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                      Page  
 
           
SECTION 5.12
  Security Interests; Further Assurances     110  
SECTION 5.13
  Information Regarding Collateral     110  
SECTION 5.14
  Affirmative Covenants with Respect to Leases     111  
SECTION 5.15
  Secured Obligations     111  
SECTION 5.16
  Post-Closing Covenants     111  
 
            ARTICLE VI. NEGATIVE COVENANTS     111  
 
           
SECTION 6.01
  Indebtedness     111  
SECTION 6.02
  Liens     114  
SECTION 6.03
  Sale and Leaseback Transactions     117  
SECTION 6.04
  Investments, Loan and Advances     117  
SECTION 6.05
  Mergers, Amalgamations and Consolidations     120  
SECTION 6.06
  Asset Sales     121  
SECTION 6.07
  European Cash Pooling Arrangements     123  
SECTION 6.08
  Dividends     123  
SECTION 6.09
  Transactions with Affiliates     124  
SECTION 6.10
  [INTENTIONALLY OMITTED]     125  
SECTION 6.11
  Prepayments of Other Indebtedness; Modifications of Organizational Documents
and Other Documents, etc.     125  
SECTION 6.12
  Limitation on Certain Restrictions on Subsidiaries     127  
SECTION 6.13
  Limitation on Issuance of Capital Stock     128  
SECTION 6.14
  Limitation on Creation of Subsidiaries     129  
SECTION 6.15
  Business     129  
SECTION 6.16
  Limitation on Accounting Changes     129  
SECTION 6.17
  Fiscal Year     129  
SECTION 6.18
  Lease Obligations     129  
SECTION 6.19
  No Further Negative Pledge     129  
SECTION 6.20
  Anti-Terrorism Law; Anti-Money Laundering     130  
SECTION 6.21
  Embargoed Persons     130  
SECTION 6.22
  Tax Shelter Reporting     131  
 
            ARTICLE VII. GUARANTEE     131  
 
           
SECTION 7.01
  The Guarantee     131  
SECTION 7.02
  Obligations Unconditional     132  
SECTION 7.03
  Reinstatement     133  
SECTION 7.04
  Subrogation; Subordination     133  
SECTION 7.05
  Remedies     133  
SECTION 7.06
  Instrument for the Payment of Money     134  
SECTION 7.07
  Continuing Guarantee     134  
SECTION 7.08
  General Limitation on Guarantee Obligations     134  
SECTION 7.09
  Release of Guarantors     134  
SECTION 7.10
  Certain Tax Matters     134  
SECTION 7.11
  German Guarantor     135  
SECTION 7.12
  Swiss Guarantors     137  
SECTION 7.13
  Irish Guarantor     138  

 

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                      Page  
 
           
SECTION 7.14
  Brazilian Guarantor     138  
 
            ARTICLE VIII. EVENTS OF DEFAULT     138  
 
           
SECTION 8.01
  Events of Default     138  
SECTION 8.02
  Rescission     141  
SECTION 8.03
  Application of Proceeds     142  
 
            ARTICLE IX. [INTENTIONALLY OMITTED]     143  
 
            ARTICLE X. THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT     143
 
 
           
SECTION 10.01
  Appointment and Authority     143  
SECTION 10.02
  Rights as a Lender     143  
SECTION 10.03
  Exculpatory Provisions     143  
SECTION 10.04
  Reliance by Agent     144  
SECTION 10.05
  Delegation of Duties     145  
SECTION 10.06
  Resignation of Agent     145  
SECTION 10.07
  Non-Reliance on Agent and Other Lenders     145  
SECTION 10.08
  No Other Duties, etc.     146  
SECTION 10.09
  Indemnification     146  
SECTION 10.10
  [INTENTIONALLY OMITTED]     146  
SECTION 10.11
  Concerning the Collateral and the Related Loan Documents     146  
SECTION 10.12
  Release     146  
SECTION 10.13
  Acknowledgment of Security Trust Deed     147  
 
            ARTICLE XI. MISCELLANEOUS     147  
 
           
SECTION 11.01
  Notices     147  
SECTION 11.02
  Waivers; Amendment     150  
SECTION 11.03
  Expenses; Indemnity; Damage Waiver     153  
SECTION 11.04
  Successors and Assigns     155  
SECTION 11.05
  Survival of Agreement     158  
SECTION 11.06
  Counterparts; Integration; Effectiveness     158  
SECTION 11.07
  Severability     158  
SECTION 11.08
  Right of Setoff     159  
SECTION 11.09
  Governing Law; Jurisdiction; Consent to Service of Process     159  
SECTION 11.10
  Waiver of Jury Trial     160  
SECTION 11.11
  Headings     160  
SECTION 11.12
  Treatment of Certain Information; Confidentiality     160  
SECTION 11.13
  USA PATRIOT Act Notice     161  
SECTION 11.14
  Interest Rate Limitation     161  
SECTION 11.15
  Lender Addendum     161  
SECTION 11.16
  Obligations Absolute     162  
SECTION 11.17
  Intercreditor Agreement     162  
SECTION 11.18
  Judgment Currency     162  
SECTION 11.19
  [INTENTIONALLY OMITTED]     163  

 

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                      Page  
 
           
SECTION 11.20
  [INTENTIONALLY OMITTED]     163  
SECTION 11.21
  Abstract Acknowledgment of Indebtedness and Joint Creditorship     163  
SECTION 11.22
  Special Appointment of Collateral Agent for German Security     164  
SECTION 11.23
  Special Appointment of Administrative Agent in Relation to South Korea     165
 
SECTION 11.24
  Designation of Collateral Agent under Civil Code of Quebec     165  
SECTION 11.25
  Maximum Liability     166  

 

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      ANNEXES

 
   
Annex I
  Applicable Margin
Annex II
  Amortization Table
Annex III
  Mandatory Cost Formula
 
    SCHEDULES

 
   
Schedule 1.01(a)
  Refinancing Indebtedness to Be Repaid
Schedule 1.01(b)
  Subsidiary Guarantors
Schedule 1.01(c)
  Excluded Collateral Subsidiaries
Schedule 1.01(d)
  Immaterial Subsidiaries
Schedule 1.01(e)
  Specified Holders
Schedule 3.06(c)
  Violations or Proceedings
Schedule 3.17
  Pension Matters
Schedule 3.19
  Insurance
Schedule 3.21
  Acquisition Documents
Schedule 3.24
  Location of Material Inventory
Schedule 4.01(g)
  Local and Foreign Counsel
Schedule 4.01(l)
  Sources and Uses
Schedule 4.01(o)(iii)
  Title Insurance Amounts
Schedule 5.11(b)
  Certain Subsidiaries
Schedule 5.16
  Post-Closing Covenants
Schedule 6.01(b)
  Existing Indebtedness
Schedule 6.02(c)
  Existing Liens
Schedule 6.04(b)
  Existing Investments
 
    EXHIBITS

 
   
Exhibit A
  Form of Administrative Questionnaire
Exhibit B
  Form of Assignment and Assumption
Exhibit C
  Form of Borrowing Request
Exhibit D
  Form of Compliance Certificate
Exhibit E
  Form of Interest Election Request
Exhibit F
  Form of Joinder Agreement
Exhibit G
  Form of Landlord Access Agreement
Exhibit H
  [INTENTIONALLY OMITTED]
Exhibit I
  Form of Lender Addendum
Exhibit J
  Form of Mortgage
Exhibit K-1
  Form of U.S. Term Loan Note
Exhibit K-2
  Form of Canadian Term Loan Note
Exhibit L-1
  Form of Perfection Certificate
Exhibit L-2
  Form of Perfection Certificate Supplement
Exhibit M-1
  Form of U.S. Security Agreement
Exhibit M-2
  Form of Canadian Security Agreement
Exhibit M-3
  Form of U.K. Security Agreement
Exhibit M-4
  Form of Swiss Security Agreement

 

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Exhibit M-5
  Form of German Security Agreement
Exhibit M-6
  Form of Irish Security Agreement
Exhibit M-7
  Form of Brazilian Security Agreement
Exhibit N
  Form of Opinion of Company Counsel
Exhibit O
  Form of Solvency Certificate
Exhibit P
  Form of Intercompany Note
Exhibit Q
  Form of Term Loan Collateral Agent Appointment Letter
Exhibit R
  Form of Receivables Purchase Agreement

 

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CREDIT AGREEMENT
     This CREDIT AGREEMENT (this “Agreement”), dated as of July 6, 2007, is
among NOVELIS INC., a corporation formed under the Canada Business Corporations
Act (the “Canadian Borrower”), NOVELIS CORPORATION, a Texas corporation (the
“U.S. Borrower” and, together with Canadian Borrower, the “Borrowers”), AV
ALUMINUM INC., a corporation formed under the Canada Business Corporations Act,
the Subsidiary Guarantors (such term and each other capitalized term used but
not defined herein having the meaning given to it in Article I), the Lenders,
UBS AG, STAMFORD BRANCH, as administrative agent (in such capacity,
“Administrative Agent”) for the Lenders, UBS AG, STAMFORD BRANCH, as collateral
agent (in such capacity, “Collateral Agent”) for the Secured Parties, UBS
SECURITIES LLC, as syndication agent (in such capacity, “Syndication Agent”),
ABN AMRO INCORPORATED, as documentation agent (in such capacity, “Documentation
Agent”), and UBS SECURITIES LLC and ABN AMRO INCORPORATED, as joint lead
arrangers and joint bookmanagers (in such capacities, “Arrangers”).
WITNESSETH:
     WHEREAS, Holdings, Canadian Borrower, a direct Wholly Owned Subsidiary of
Holdings, and Hindalco Industries Limited (“Acquiror”) entered into that certain
Arrangement Agreement, dated as of February 10, 2007 (as amended, supplemented
or otherwise modified from time to time, together with any annexes, schedules,
exhibits or other attachments thereto, the “Acquisition Agreement”), pursuant to
which Holdings agreed to acquire Canadian Borrower via a plan of arrangement
under Section 192 of the Canada Business Corporations Act (the “Hindalco
Acquisition”).
     WHEREAS, the Hindalco Acquisition closed on the Acquisition Closing Date.
     WHEREAS, the Borrowers have requested the Lenders to extend credit in the
form of Term Loans on the Closing Date in an aggregate principal amount not in
excess of $960 million, consisting of (i) U.S. Term Loans in an aggregate
principal amount not in excess of $660 million and (ii) Canadian Term Loans in
an aggregate principal amount not in excess of $300 million.
     WHEREAS, the proceeds of the Loans are to be used in accordance with
Section 3.12.
     WHEREAS, Holdings, Canadian Borrower, the U.S. Borrower and the other
Subsidiary Guarantors party thereto shall enter into the Revolving Credit
Agreement providing for Revolving Credit Loans at any time and from time to time
prior to the Revolving Credit Maturity Date in the aggregate principal amount of
up to $800 million simultaneously herewith.
     NOW, THEREFORE, the Lenders are willing to extend such Term Loans to the
Borrowers on the terms and subject to the conditions set forth herein.
Accordingly, the parties hereto agree as follows:
 

 

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ARTICLE I.
DEFINITIONS
SECTION 1.01 Defined Terms. As used in this Agreement (including the preamble),
the following terms shall have the meanings specified below:
     “ABN AMRO” shall mean ABN AMRO Bank N.V.
     “ABR”, when used in reference to any Loan or Borrowing, is used when such
Loan, or the Loans comprising such Borrowing, are bearing interest at a rate
determined by reference to the Alternate Base Rate.
     “ABR Borrowing” shall mean a Borrowing comprised of ABR Loans.
     “ABR Loan” shall mean any Loan bearing interest at a rate determined by
reference to the Alternate Base Rate in accordance with the provisions of
ARTICLE II.
     “Accounts” shall mean all “accounts,” as such term is defined in the UCC as
in effect on the date hereof in the State of New York, in which such Person now
or hereafter has rights.
     “Acquiror” shall have the meaning assigned to such term in the recitals
hereto.
     “Acquisition” shall mean any transaction or series of related transactions
for the direct or indirect (a) acquisition of all or substantially all of the
property and assets or business of any person, or of any business unit, line of
business or division of any person or assets constituting a business unit, line
of business or division of any other person, (b) acquisition of in excess of 50%
of the Equity Interests of any person or otherwise causing a person to become a
Subsidiary of the acquiring person, or (c) merger, consolidation or
amalgamation, whereby a person becomes a Subsidiary of the acquiring person, or
any other consolidation with any person, whereby a person becomes a Subsidiary
of the acquiring person.
     “Acquisition Agreement” shall have the meaning assigned to such term in the
recitals hereto.
     “Acquisition Closing Date” shall mean May 15, 2007.
     “Acquisition Consideration” shall mean the purchase consideration for any
Permitted Acquisition, whether paid in cash, properties, any assumption of
Indebtedness or otherwise (other than by the issuance of Qualified Capital Stock
of Holdings permitted to be issued hereunder) and whether payable at or prior to
the consummation of such Permitted Acquisition or deferred for payment at any
future time, whether or not any such future payment is subject to the occurrence
of any contingency, and includes any and all payments representing “earn-outs”
and other agreements to make any payment the amount of which is, or the terms of
payment of which are, in any respect subject to or contingent upon the revenues,
income, cash flow or profits (or the like) of any person or business; provided
that any such future payment that is subject to a contingency shall be
considered Acquisition Consideration only to the extent of the reserve, if

     
 
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any, required under GAAP at the time of such sale to be established in respect
thereof by Holdings or any of its Subsidiaries.
     “Acquisition Documents” shall have the meaning assigned to such term in
Section 3.21.
     “Acquisition Material Adverse Effect” shall mean any change, effect, event,
occurrence, state of facts or development which individually or in the aggregate
(a) is or would reasonably be expected to be materially adverse to the business,
operations, results of operations, affairs, liabilities or obligations (whether
absolute, accrued, conditional, contingent or otherwise), capitalization or
financial condition of Canadian Borrower and its Subsidiaries, taken as a whole;
or (b) is or would reasonably be expected to impair in any material respect the
ability of Canadian Borrower to consummate the transactions contemplated by the
Acquisition Agreement or to perform its obligations under the Acquisition
Agreement on a timely basis; provided that none of the following shall be
deemed, either individually or in the aggregate, to constitute an Acquisition
Material Adverse Effect: any change, effect, event, occurrence, state of facts
or development (A) in the financial, banking, credit, securities, or commodities
markets, the economy in general or prevailing interest rates of the United
States, Canada or any other jurisdiction, where Canadian Borrower or any of its
Subsidiaries has operations or significant revenues, (B) in any industry in
which Canadian Borrower or any of its Subsidiaries operates, (C) in Canadian
Borrower’s stock price or trading volume (provided that this clause (C) shall
not be construed as providing that any cause or factor affecting Canadian
Borrower’s stock price or trading volume does not constitute an Acquisition
Material Adverse Effect), (D) arising as a result of a change in U.S. GAAP or
regulatory accounting principles or interpretations thereof after the date
hereof, (E) in Law (as defined in the Acquisition Agreement as of the
Acquisition Closing Date) or interpretations thereof by any Governmental Entity
(as defined in the Acquisition Agreement as of the Acquisition Closing Date),
(F) arising or resulting from the announcement of the Acquisition Agreement, the
pendency of the transactions contemplated therein and in the Plan of Arrangement
(as defined in the Acquisition Agreement as of the Acquisition Closing Date),
(G) arising or resulting from any failure by Canadian Borrower to meet any
internal or published projections, forecasts or revenue or earnings predictions
(provided that this clause (G) shall not be construed as providing that any
cause or factor giving rise to such failure does not constitute an Acquisition
Material Adverse Effect), (H) any continuation of an adverse trend or condition
or the escalation of, or any developments with respect to, any dispute referred
to on Schedule 3.07 of Canadian Borrower Disclosure Schedule to the Acquisition
Agreement on the Acquisition Closing Date, (I) arising or resulting from any act
of war or terrorism (or, in each case, escalation thereof) or declaration of a
national emergency, or (J) arising or resulting from the acts or omissions of
Acquiror and/or its Affiliates, as determined immediately prior to the
Acquisition Closing Date; except in the cases of clauses (A), (B) and (I), to
the extent such change, effect, event, occurrence, state of facts or development
has or would reasonably be expected to have a disproportionate effect on
Canadian Borrower and its Subsidiaries, taken as a whole, as compared to other
persons in the industries in which Canadian Borrower and its Subsidiaries
operate unless such disproportionate change, effect, event, occurrence, state of
facts or development arises from any metal price ceiling in any of Canadian
Borrower’s customer contracts.
     “Additional Subordinated Debt Loan” shall mean any loan, advance or other
extension of credit extended by the Acquiror or any of its Affiliates (other
than any Subsidiary of

     
 
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Holdings) to Holdings having the same subordination terms as the subordination
terms applicable to the Subordinated Debt Loan as in effect on the Closing Date;
provided that such loan, advance or extension of credit shall be unsecured
Indebtedness of Holdings, (i) with respect to which no Borrower or Subsidiary
has any Contingent Obligation, (ii) that will not mature prior to the 180th day
following the Final Maturity Date, (iii) that has no scheduled amortization of
principal prior to the 180th day following the Final Maturity Date, (iv) that
does not require any payments in cash of interest, principal or other amounts
prior to the 180th day following the Final Maturity Date, and (v) that has no
mandatory prepayment, repurchase or redemption requirements; and provided,
further, that at least five Business Days prior to the time of incurrence of
such Indebtedness (or such shorter period as the Administrative Agent may
agree), a Responsible Officer of Holdings delivers a certificate to the
Administrative Agent (together with drafts of the documentation relating
thereto) stating that Holdings has determined in good faith that such terms and
conditions satisfy the foregoing requirements.
     “Adjusted LIBOR Rate” shall mean, with respect to any Eurocurrency
Borrowing for any Interest Period, an interest rate per annum (rounded upward,
if necessary, to the nearest 1/100th of 1%) determined by the Administrative
Agent to be equal to the sum of (a) (i) the LIBOR Rate for such Eurocurrency
Borrowing in effect for such Interest Period divided by (ii) 1 minus the
Statutory Reserves (if any) for such Eurocurrency Borrowing for such Interest
Period plus, (b) without duplication of any increase in interest rate
attributable to Statutory Reserves pursuant to the foregoing clause (ii), the
Mandatory Cost (if any).
     “Administrative Agent” shall have the meaning assigned to such term in the
preamble hereto and includes each other person appointed as the successor
pursuant to ARTICLE X.
     “Administrative Borrower” shall mean Novelis Inc., or any successor entity
serving in that role pursuant to Section 2.03(b).
     “Administrative Questionnaire” shall mean an Administrative Questionnaire
in substantially the form of Exhibit A.
     “Affiliate” shall mean, when used with respect to a specified person,
another person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the person
specified; provided, however, that, for purposes of Section 6.09, the term
“Affiliate” shall also include (i) any person that directly or indirectly owns
more than 15% of any class of Equity Interests of the person specified or
(ii) any person that is an executive officer or director of the person
specified.
     “Agents” shall mean the Administrative Agent and the Collateral Agent; and
“Agent” shall mean any of them.
     “Agreement” shall have the meaning assigned to such term in the preamble
hereto.
     “Alternate Base Rate” shall mean, for any day, a rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the greater of
(a) the Base Rate in effect on such day and (b) the Federal Funds Effective Rate
in effect on such day plus 0.50%. If the Administrative Agent shall have
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Federal Funds Effective Rate for any reason,

     
 
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including the inability of the Administrative Agent to obtain sufficient
quotations in accordance with the terms of the definition thereof, the Alternate
Base Rate shall be determined without regard to clause (b) of the preceding
sentence until the circumstances giving rise to such inability no longer exist.
Any change in the Alternate Base Rate due to a change in the Base Rate or the
Federal Funds Effective Rate shall be effective on the effective date of such
change in the Base Rate or the Federal Funds Effective Rate, respectively.
     “Anti-Terrorism Laws” shall have the meaning assigned to such term in
Section 3.22.
     “Applicable Margin” shall mean, for any day, with respect to any Term Loan
the applicable percentage set forth in Annex I under the appropriate caption.
     “Approved Fund” shall mean any Fund that is administered or managed by
(a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of
an entity that administers or manages a Lender.
     “Approved Member State” shall mean Belgium, France, Germany, Ireland,
Italy, Luxembourg, The Netherlands, Spain, Sweden and the United Kingdom.
     “Arrangers” shall have the meaning assigned to such term in the preamble
hereto.
     “Asset Sale” shall mean (a) any conveyance, sale, lease, sublease,
assignment, transfer or other disposition (including by way of merger or
consolidation and including any Sale and Leaseback Transaction) of any property,
excluding (i) sales of Inventory and dispositions of cash and Cash Equivalents,
in each such excluded case, which are in the ordinary course of business, by
Holdings or any of its Subsidiaries, and (ii) sales of Accounts pursuant to the
Receivables Purchase Agreement by any Loan Party or (b) any issuance or sale of
any Equity Interests of any Subsidiary of Holdings; provided that such issuances
or sales of Equity Interests to Companies other than Holdings shall constitute
Asset Sales only for purposes of Section 6.06.
     “Asset Swap” shall mean the substantially concurrent purchase and sale or
exchange of Related Business Assets or a combination of Related Business Assets
and cash or Cash Equivalents between any Company and another person; provided
that any cash or Cash Equivalents received must be applied in accordance with
Section 2.10(c).
     “Assignment and Assumption” shall mean an assignment and assumption entered
into by a Lender and an Eligible Assignee (with the consent of any party whose
consent is required by Section 11.04(b)), and accepted by the Administrative
Agent, in substantially the form of Exhibit B, or any other form approved by the
Administrative Agent.
     “Attributable Indebtedness” shall mean, when used with respect to any Sale
and Leaseback Transaction, as at the time of determination, the present value
(discounted at the rate implicit in the lease) of the total obligations of the
lessee for rental payments during the remaining term of the lease included in
any such Sale and Leaseback Transaction.
     “Auditor’s Determination” shall have the meaning assigned to such term in
Section 7.11(b).

     
 
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     “AV Aluminum” shall mean AV Aluminum Inc., a corporation formed under the
Canada Business Corporations Act.
     “AV Metals” shall mean AV Metals, Inc., a corporation formed under the
Canada Business Corporations Act.
     “Available Amount” shall have the meaning assigned to such term in
Section 7.12(a).
     “Base Rate” shall mean, for any day, a rate per annum that is equal to the
corporate base rate of interest established by the Administrative Agent from
time to time; each change in the Base Rate shall be effective on the date such
change is effective. The corporate base rate is not necessarily the lowest rate
charged by the Administrative Agent to its customers.
     “Board” shall mean the Board of Governors of the Federal Reserve System of
the United States.
     “Board of Directors” shall mean, with respect to any person, (i) in the
case of any corporation, the board of directors of such person, (ii) in the case
of any limited liability company, the board of managers of such person, (iii) in
the case of any partnership, the Board of Directors of the general partner of
such person and (iv) in any other case, the functional equivalent of the
foregoing.
     “Borrowers” shall have the meaning assigned to such term in the preamble
hereto. Unless the context otherwise requires, and subject to Section 11.25,
each reference in this Agreement to “each Borrower” or “the applicable Borrower”
shall be deemed to be a reference to (x) the U.S. Borrower and/or (y) Canadian
Borrower, as the case may be.
     “Borrowing” shall mean Loans to the U.S. Borrower or Canadian Borrower, in
each case, of the same Class and Type, made, converted or continued on the same
date and, in the case of Eurocurrency Loans, as to which a single Interest
Period is in effect.
     “Borrowing Request” shall mean a request by a Borrower in accordance with
the terms of Section 2.03 and substantially in the form of Exhibit C, or such
other form as shall be approved by the Administrative Agent.
     “Brazilian Guarantor” shall mean each Subsidiary of Holdings organized in
Brazil party hereto as a Guarantor, and each other Subsidiary of Holdings
organized in Brazil that is required to become a Guarantor pursuant to the terms
hereof.
     “Brazilian Security Agreements” shall mean, collectively, any Security
Agreements substantially in the form of Exhibits M-7-1 to 5 among the Brazilian
Guarantor and the Collateral Agent for the benefit of the Secured Parties.
     “Business Day” shall mean any day other than a Saturday, Sunday or other
day on which banks in New York City are authorized or required by law to close;
provided, however, that when used in connection with notices and determinations
in connection with, and payments of principal and interest on or with respect
to, a Eurocurrency Loan, the term “Business Day” shall

     
 
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also exclude any day on which banks are not open for dealings in dollar deposits
in the London interbank market.
     “Canadian Borrower” shall have the meaning assigned to such term in the
preamble hereto.
     “Canadian Guarantor” shall mean Holdings and each Subsidiary of Holdings
organized in Canada (other than Canadian Borrower) party hereto as a Guarantor,
and each other Subsidiary of Holdings organized in Canada that is required to
become a Guarantor pursuant to the terms hereof.
     “Canadian Loan Parties” shall mean Canadian Borrower and the Canadian
Guarantors.
     “Canadian Term Loan” shall have the meaning assigned to such term in
Section 2.01(b).
     “Canadian Term Loan Commitment” shall mean, with respect to each Lender,
the commitment, if any, of such Lender to make Canadian Term Loans hereunder up
to the amount set forth on Schedule I to the Lender Addendum executed and
delivered by such Lender directly under the column entitled “Canadian Term Loan
Commitment” or in an Increase Joinder. The aggregate amount of the Lenders’
Canadian Term Loan Commitments on the Closing Date is $300 million.
     “Canadian Security Agreement” shall mean the Security Agreements
substantially in the form of Exhibits M-2-1 to 6 among the Canadian Loan Parties
and the Collateral Agent for the benefit of the Secured Parties.
     “Capital Assets” shall mean, with respect to any person, all equipment,
fixed assets and Real Property or improvements of such person, or replacements
or substitutions therefor or additions thereto, that, in accordance with GAAP,
have been or should be reflected as additions to property, plant or equipment on
the balance sheet of such person.
     “Capital Expenditures” shall mean, for any period, without duplication, all
expenditures made directly or indirectly by Canadian Borrower and its
Subsidiaries during such period for Capital Assets (whether paid in cash or
other consideration, financed by the incurrence of Indebtedness or accrued as a
liability), together with Canadian Borrower’s proportionate share of such
amounts for Norf GmbH for such period, but in each case excluding any portion of
such expenditures constituting the Acquisition Consideration for acquisitions of
property, plant and equipment in Permitted Acquisitions or paid for with
insurance proceeds.
     “Capital Lease Obligations” of any person shall mean the obligations of
such person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.

     
 
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     “Cash Equivalents” shall mean, as to any person, (a) securities issued or
fully guaranteed or insured by the federal government of the United States,
Canada, Switzerland, any Approved Member State or any agency of the foregoing,
(b) marketable direct obligations issued by any state of the United States or
the District of Columbia or any political subdivision or instrumentality thereof
that, at the time of the acquisition, are rated at least “A-2” by S&P or “P-2”
by Moody’s, (c) certificates of deposit, eurocurrency time deposits, overnight
bank deposits and bankers’ acceptances of any commercial bank organized under
the laws of the United States, any state thereof, the District of Columbia, any
non-U.S. bank, or its branches or agencies (fully protected against currency
fluctuations) that, at the time of acquisition, are rated at least “A-2” by S&P
or “P-2” by Moody’s, (d) commercial paper of an issuer rated at least “A-2” by
S&P or “P-2” by Moody’s, (e) shares of any money market fund that (i) has at
least 95% of its assets invested continuously in the types of investments
referred to in clauses (a), (b) and (c) above, (ii) has net assets, Dollar
Equivalent of which exceeds $500,000,000 and (iii) is rated at least “A-2” by
S&P or “P-2” by Moody’s; provided, however, that the maturities of all
obligations of the type specified in clauses (a), (b) and (c) above shall not
exceed 365 days; provided, further, that, to the extent any cash is generated
through operations in a jurisdiction outside of the United States, Canada,
Switzerland or an Approved Member State, such cash may be retained and invested
in obligations of the type described in clauses (a), (b) and (c) to the extent
that such obligations have a credit rating equal to the sovereign rating of such
jurisdiction.
     “Cash Interest Expense” shall mean, for any period, Consolidated Interest
Expense for such period, less the sum of (a) interest on any debt paid by the
increase in the principal amount of such debt including by issuance of
additional debt of such kind, (b) items described in clause (c) of the
definition of “Consolidated Interest Expense” and (c) gross interest income of
Canadian Borrower and its Subsidiaries for such period.
     “Casualty Event” shall mean any involuntary loss of title, any involuntary
loss of, damage to or any destruction of, or any expropriation, condemnation or
other taking (including by any Governmental Authority) of, any property of
Holdings or any of its Subsidiaries. “Casualty Event” shall include but not be
limited to any taking of all or any part of any Real Property of any person or
any part thereof, in or by expropriation, condemnation or other eminent domain
proceedings pursuant to any Requirement of Law, or by reason of the temporary
requisition of the use or occupancy of all or any part of any Real Property of
any person or any part thereof by any Governmental Authority, civil or military,
or any settlement in lieu thereof.
     “CERCLA” shall mean the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended, 42 U.S.C. § 9601 et seq. and all
implementing regulations.
     A “Change in Control” shall be deemed to have occurred if:
     (a) Acquiror at any time ceases to be the beneficial owner (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act) of at least 51% of the Equity
Interests of Holdings,
     (b) Holdings at any time ceases to be the beneficial owner (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act) and the direct record owner of
100% of

     
 
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the Equity Interests of Canadian Borrower; provided that a Permitted Holdings
Amalgamation shall not constitute a Change of Control under this clause (b),
     (c) Canadian Borrower at any time ceases to be the beneficial owner (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act) and the direct or
indirect owner of 100% of the Equity Interests of each of the U.S. Borrower and
Novelis Deutschland GmbH;
     (d) at any time a change of control occurs under any Material Indebtedness;
     (e) any “person” or “group” (as such terms are used in Sections 13(d) and
14(d) of the Exchange Act) other than the Specified Holders is or becomes the
beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that for purposes of this clause (except as set forth below) such person
or group shall be deemed to have “beneficial ownership” of all securities that
such person or group has the right to acquire, whether such right is exercisable
immediately or only after the passage of time) of Voting Stock of Acquiror
representing 50% or more of the voting power of the total outstanding Voting
Stock of Acquiror; or
     (f) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Board of Directors of Acquiror
(together with any new directors whose election to such Board of Directors or
whose nomination for election was approved by the Specified Holders or by a vote
of at least a majority of the members of the Board of Directors of Acquiror,
which members comprising such majority are then still in office and were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of Acquiror.
     For purposes of this definition, a person shall not be deemed to have
beneficial ownership of Equity Interests subject to a stock purchase agreement,
merger agreement or similar agreement until the consummation of the transactions
contemplated by such agreement.
     “Change in Law” shall mean the occurrence, after the date of this
Agreement, of any of the following: (a) the adoption or taking into effect of
any law, treaty, order, policy, rule or regulation, (b) any change in any law,
treaty, order, policy, rule or regulation or in the administration,
interpretation or application thereof by any Governmental Authority or (c) the
making or issuance of any request, guideline or directive (whether or not having
the force of law) by any Governmental Authority.
     “Charges” shall have the meaning assigned to such term in Section 11.14.
     “Chattel Paper” shall mean all “chattel paper,” as such term is defined in
the UCC as in effect on the date hereof in the State of New York, in which any
Person now or hereafter has rights.
     “Chief Executive Office” shall mean, with respect to any Person, the
location from which such Person manages the main part of its business operations
or other affairs.

     
 
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     “Class,” when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are U.S. Term Loans or
Canadian Term Loans and, when used in reference to any Commitment, refers to
whether such Commitment is a U.S. Term Loan Commitment or a Canadian Term Loan
Commitment, in each case, under this Agreement as originally in effect or
pursuant to Section 2.23, of which such Loan, Borrowing or Commitment shall be a
part.
     “Closing Date” shall mean the date of the initial Credit Extension
hereunder.
     “CNI Basket” shall have the meaning assigned to such term in
Section 6.08(d).
     “Code” shall mean the Internal Revenue Code of 1986, as amended, and the
Treasury Regulations promulgated thereunder.
     “Collateral” shall mean, collectively, all of the Revolving Credit Priority
Collateral and the Term Loan Priority Collateral.
     “Collateral Agent” shall have the meaning assigned to such term in the
preamble hereto and includes each other person appointed as the successor
pursuant to ARTICLE X.
     “Commerzbank Cash Pooling Agreement” shall mean an Agreement regarding an
Automatic Cash Management System entered into between Novelis AG, the
“Companies” (as defined therein) and Commerzbank Aktiengesellschaft, Berlin
dated 15 January 2007, together with all ancillary documentation thereto.
     “Commitment” shall mean, with respect to any Lender, such Lender’s U.S.
Term Loan Commitment and/or Canadian Term Loan Commitment, including any
Incremental Term Loan Commitment pursuant to Section 2.23.
     “Companies” shall mean Holdings and its Subsidiaries; and “Company” shall
mean any one of them.
     “Compensation Plan” shall mean any program, plan or similar arrangement
(other than employment contracts for a single individual) relating generally to
compensation, pension, employment or similar arrangements with respect to which
any Company, any Affiliate of any Company or any ERISA Affiliate of any of them
has any obligation or liability, contingent or otherwise, under any Requirements
of Law other than those of the United States.
     “Compliance Certificate” shall mean a certificate of a Financial Officer
substantially in the form of Exhibit D.
     “Confidential Information Memorandum” shall mean that certain confidential
information memorandum of Novelis Inc., dated June 2007.
     “Consolidated Adjusted EBITDA” shall mean, for any period, Consolidated
EBITDA for such period plus, to the extent not otherwise included in
Consolidated EBITDA:

     
 
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     (a) 100% of the net income of each Joint Venture Subsidiary and Logan for
such period minus the amount of any dividends or distributions paid to the
holder of any interest (other than a Company) in such Joint Venture Subsidiary
or Logan during such period; and
     (b) the Canadian Borrower’s proportionate share of EBITDA of Norf GmbH for
such period.
     “Consolidated Amortization Expense” shall mean, for any period, the
amortization expense of Canadian Borrower and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.
     “Consolidated Current Assets” shall mean, as at any date of determination,
the total assets of Canadian Borrower and its Subsidiaries which may properly be
classified as current assets on a consolidated balance sheet of Canadian
Borrower and its Subsidiaries in accordance with GAAP, excluding cash and Cash
Equivalents.
     “Consolidated Current Liabilities” shall mean, as at any date of
determination, the total liabilities of Canadian Borrower and its Subsidiaries
which may properly be classified as current liabilities (other than the current
portion of any Loans) on a consolidated balance sheet of Canadian Borrower and
its Subsidiaries in accordance with GAAP, but excluding (a) the current portion
of any Funded Debt of Canadian Borrower and its Subsidiaries and (b) without
duplication of clause (a) above, all Indebtedness consisting of Revolving Credit
Loans to the extent otherwise included therein.
     “Consolidated Depreciation Expense” shall mean, for any period, the
depreciation expense of Canadian Borrower and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.
     “Consolidated EBITDA” shall mean, for any period, Consolidated Net Income
for such period, adjusted by:
     (x) adding thereto, in each case only to the extent (and in the same
proportion) deducted in determining such Consolidated Net Income and without
duplication:
     (a) Consolidated Interest Expense for such period,
     (b) Consolidated Amortization Expense for such period,
     (c) Consolidated Depreciation Expense for such period,
     (d) Consolidated Tax Expense for such period,
     (e) non-recurring cash expenses and charges relating to the Hindalco
Acquisition and the Refinancing,
     (f) restructuring charges in an amount not to exceed $15 million in the
aggregate during the term hereof; and

     
 
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     (g) the aggregate amount of all other non-cash charges reducing
Consolidated Net Income (excluding any non-cash charge that results in an
accrual of a reserve for cash charges in any future period) for such period;
     (y) subtracting therefrom, the aggregate amount of all non-cash items
increasing Consolidated Net Income (other than the accrual of revenue or
recording of receivables in the ordinary course of business) for such period;
and
     (z) excluding therefrom,
     (a) any gain (or loss), together with any related provisions for taxes on
any such gain (or the tax effect of any such loss), realized during such period
by Canadian Borrower or any of its Subsidiaries upon any Asset Sale (other than
any dispositions in the ordinary course of business) by Canadian Borrower or any
of its Subsidiaries,
     (b) gains and losses due solely to fluctuations in currency values and the
related tax effects determined in accordance with GAAP for such period,
     (c) earnings or losses resulting from any reappraisal, revaluation or
write-up or write-down of assets,
     (d) any one-time increase or decrease to net income that is required to be
recorded because of the adoption of new accounting policies, practices or
standards required by GAAP,
     (e) unrealized gains and losses with respect to Hedging Obligations for
such period, and
     (f) any extraordinary gain (or extraordinary loss), together with any
related provision for taxes on any such gain (or the tax effect of any such
loss), recorded or recognized by Canadian Borrower or any of its Subsidiaries
during such period;
     Other than for purposes of calculating Excess Cash Flow, Consolidated
EBITDA shall be calculated on a Pro Forma Basis to give effect to any Permitted
Acquisition and Asset Sales (other than any dispositions in the ordinary course
of business, dispositions where the value of the assets disposed of is less than
$15 million and Permitted Acquisitions where the amount of the Acquisition
Consideration plus any Equity Interests constituting all or a portion of the
purchase price is less than $15 million) consummated at any time on or after the
first day of the Test Period thereof as if each such Permitted Acquisition had
been effected on the first day of such period and as if each such Asset Sale had
been consummated on the day prior to the first day of such period.
     “Consolidated Indebtedness” shall mean, as at any date of determination,
the aggregate amount of all Indebtedness of Canadian Borrower and its
Subsidiaries (other than (i) Indebtedness specified in clauses (g) and (h)
(unless the lease giving rise to such Attributable Indebtedness is a Capital
Lease) of the definition thereof, (ii) bankers’ acceptances, letters of credit
and similar credit arrangements with respect to which no reimbursement
obligation has arisen, (iii) letters of credit permitted to be incurred under
Section 6.01(p) and (iv) from and after

     
 
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the Permitted Holdings Amalgamation, the Subordinated Debt Loan), determined on
a consolidated basis in accordance with GAAP.
     “Consolidated Interest Expense” shall mean, for any period, the total
consolidated interest expense of Canadian Borrower and its Subsidiaries for such
period determined on a consolidated basis in accordance with GAAP plus, without
duplication:
     (a) imputed interest on Capital Lease Obligations and Attributable
Indebtedness of Canadian Borrower and its Subsidiaries for such period;
     (b) commissions, discounts and other fees and charges owed by Canadian
Borrower or any of its Subsidiaries with respect to letters of credit securing
financial obligations, bankers’ acceptance financing and receivables financings
for such period;
     (c) amortization of debt issuance costs, debt discount or premium and other
financing fees and expenses incurred by Canadian Borrower or any of its
Subsidiaries for such period;
     (d) all interest paid or payable with respect to discontinued operations of
Canadian Borrower or any of its Subsidiaries for such period; and
     (e) the interest portion of any deferred payment obligations of Canadian
Borrower or any of its Subsidiaries for such period.
     Other than for purposes of calculating Excess Cash Flow, Consolidated
Interest Expense shall be calculated on a Pro Forma Basis to give effect to any
Indebtedness incurred, assumed or permanently repaid or extinguished during the
relevant Test Period in connection with any Permitted Acquisitions and Asset
Sales (other than any dispositions in the ordinary course of business,
dispositions where the value of the assets disposed of is less than $15 million
and Permitted Acquisitions where the amount of the Acquisition Consideration
plus any Equity Interests constituting all or a portion of the purchase price is
less than $15 million) as if such incurrence, assumption, repayment or
extinguishing had been effected on the first day of such period.
     “Consolidated Net Income” shall mean, for any period, the consolidated net
income (or loss) of Canadian Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP; provided, however, that:
     (a) the net income (or loss) of any person in which any person other than
Canadian Borrower and its Subsidiaries has an ownership interest (which interest
does not cause the net income of such other person to be consolidated into the
net income of Canadian Borrower and its Subsidiaries) shall be excluded, except
to the extent actually received by Canadian Borrower or any of its Subsidiaries
during such period; and
     (b) the net income of any Subsidiary of Canadian Borrower other than a Loan
Party that is subject to a prohibition on the payment of dividends or similar
distributions by such Subsidiary shall be excluded to the extent of such
prohibition.

     
 
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     For purposes of this definition of “Consolidated Net Income,” Consolidated
Net Income shall be reduced (to the extent not already reduced thereby) by the
amount of any payments to or on behalf of Holdings made pursuant to
Section 6.08(c).
     “Consolidated Senior Secured Indebtedness” shall mean, as at any date of
determination, the aggregate amount of all Consolidated Indebtedness of the
Companies that is secured by a Lien on the assets of any of such persons.
     “Consolidated Tax Expense” shall mean, for any period, the tax expense of
Canadian Borrower and its Subsidiaries, for such period, determined on a
consolidated basis in accordance with GAAP.
     “Contingent Obligation” shall mean, as to any person, any obligation,
agreement, understanding or arrangement of such person guaranteeing or intended
to guarantee any Indebtedness, leases, dividends or other obligations (“primary
obligations”) of any other person (the “primary obligor”) in any manner, whether
directly or indirectly, including any obligation of such person, whether or not
contingent, (a) to purchase any such primary obligation or any property
constituting direct or indirect security therefor; (b) to advance or supply
funds (i) for the purchase or payment of any such primary obligation or (ii) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor; (c) to purchase
property, securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation; (d) with respect to bankers’ acceptances,
letters of credit and similar credit arrangements, until a reimbursement
obligation arises (which reimbursement obligation shall constitute
Indebtedness); or (e) otherwise to assure or hold harmless the holder of such
primary obligation against loss in respect thereof; provided, however, that the
term “Contingent Obligation” shall not include endorsements of instruments for
deposit or collection in the ordinary course of business or any product
warranties. The amount of any Contingent Obligation shall be deemed to be an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Contingent Obligation is made (or, if less, the maximum
amount of such primary obligation for which such person may be liable, whether
singly or jointly, pursuant to the terms of the instrument evidencing such
Contingent Obligation) or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such person is required to
perform thereunder) as determined by such person in good faith.
     “Contribution, Intercompany, Contracting and Offset Agreement” shall mean
that certain Contribution, Intercompany, Contracting and Offset Agreement dated
as of the date hereof by and among the Loan Parties (other than certain Foreign
Subsidiaries), Collateral Agent and Administrative Agent.
     “Contribution Notice” shall mean a contribution notice issued by the
Pensions Regulator under Section 38 or Section 47 of the Pensions Act 2004.
     “Control” shall mean the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a person,
whether through the ownership of

     
 
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voting securities, by contract or otherwise, and the terms “Controlling” and
“Controlled” shall have meanings correlative thereto.
     “Control Agreement” shall mean, with respect to a Deposit Account,
Securities Account, or Commodity Account (each as defined in the UCC as in
effect on the date hereof in the State of New York), (i) located in the United
States, an agreement in form and substance reasonably satisfactory to the
Collateral Agent establishing the Collateral Agent’s “control” (within the
meaning of the UCC) in such account, or (ii) located in other jurisdictions,
agreements with regard to such accounts establishing and perfecting the First
Priority Lien of the Collateral Agent in such accounts), and otherwise in form
and substance reasonably satisfactory to the Collateral Agent.
     “Credit Extension” shall mean the making of a Loan by a Lender.
     “Debt Issuance” shall mean the incurrence by Holdings or any of its
Subsidiaries of any Indebtedness after the Closing Date (other than as permitted
by Section 6.01).
     “Debt Service” shall mean, for any period, Cash Interest Expense for such
period plus scheduled principal amortization of all Indebtedness paid in such
period.
     “Default” shall mean an Event of Default or an event, occurrence or
condition which is, or upon notice, lapse of time or both would constitute, an
Event of Default.
     “Default Rate” shall have the meaning assigned to such term in
Section 2.06(c).
     “Delegate” shall mean any delegate, agent, attorney, trustee or co-trustee
appointed by the Collateral Agent or any Receiver.
     “Disqualified Capital Stock” shall mean any Equity Interest which, by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable), or upon the happening of any event, (a) matures (excluding
any maturity as the result of an optional redemption by the issuer thereof) or
is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise,
or is redeemable at the option of the holder thereof, in whole or in part, on or
prior to 180 days after the Final Maturity Date, (b) is convertible into or
exchangeable (unless at the sole option of the issuer thereof) for (i) debt
securities or (ii) any Equity Interests referred to in (a) above, in each case
at any time on or prior to 180 days after the Final Maturity Date, or
(c) contains any mandatory repurchase obligation which may come into effect
prior to 180 days after the Final Maturity Date; provided, however, that any
Equity Interests that would not constitute Disqualified Capital Stock but for
provisions thereof giving holders thereof (or the holders of any security into
or for which such Equity Interests is convertible, exchangeable or exercisable)
the right to require the issuer thereof to redeem such Equity Interests upon the
occurrence of a change in control or an asset sale occurring prior to 180 days
after the Final Maturity Date shall not constitute Disqualified Capital Stock if
such Equity Interests provide that the issuer thereof will not redeem any such
Equity Interests pursuant to such provisions prior to the repayment in full of
the Obligations.
     “Distribution” shall mean, collectively, with respect to each Loan Party,
all dividends, cash, options, warrants, rights, instruments, distributions,
returns of capital or principal, income,

     
 
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interest, profits and other property, interests (debt or equity) or proceeds,
including as a result of a split, revision, reclassification or other like
change of the Pledged Securities, from time to time received, receivable or
otherwise distributed to such Loan Party in respect of or in exchange for any or
all of the Pledged Securities or Pledged Intercompany Notes.
     “Dividend” with respect to any person shall mean that such person has
declared or paid a dividend or returned any equity capital to the holders of its
Equity Interests or authorized or made any other distribution, payment or
delivery of property (other than Qualified Capital Stock of such person) or cash
to the holders of its Equity Interests as such, or redeemed, retired, purchased
or otherwise acquired, directly or indirectly, for consideration any of its
Equity Interests outstanding (or any options or warrants issued by such person
with respect to its Equity Interests), or set aside any funds for any of the
foregoing purposes, or shall have permitted any of its Subsidiaries to purchase
or otherwise acquire for consideration any of the Equity Interests of such
person outstanding (or any options or warrants issued by such person with
respect to its Equity Interests). Without limiting the foregoing, “Dividends”
with respect to any person shall also include all payments made or required to
be made by such person with respect to any stock appreciation rights, plans,
equity incentive or achievement plans or any similar plans or setting aside of
any funds for the foregoing purposes.
     “Documentation Agent” shall have the meaning assigned to such term in the
preamble hereto.
     “Dollar Equivalent” shall mean, as to any amount denominated in any
currency other than Dollars as of any date of determination, the amount of
Dollars that would be required to purchase the amount of such currency based
upon the Spot Selling Rate as of such date, and as to any amount denominated in
Dollars, such amount in Dollars.
     “Dollars” or “dollars” or “$” shall mean lawful money of the United States.
     “EBITDA of Norf GmbH” shall mean, with respect to any period, the net
income of Norf GmbH plus to the extent deducted in determining net income,
interest expense, depreciation and amortization expense, tax expense and the
aggregate amount of all other non-cash charges reducing such net income
(excluding any non-cash charge that results in an accrual of a reserve for cash
charges in any future period) for such period minus the aggregate amount of all
non-cash items increasing such net income (other than the accrual of revenue or
recording of receivables in the ordinary course of business) for such period;
provided that in calculating such EBITDA of Norf GmbH the following shall be
excluded:
     (i) any gain (or loss), together with any related provisions for taxes on
any such gain (or the tax effect of any such loss), realized during such period
by Norf GmbH or any of its Subsidiaries upon an asset sale (other than any
dispositions in the ordinary course of business) by Norf GmbH or any of its
Subsidiaries;
     (ii) gains and losses due solely to fluctuations in currency values and the
related tax effects determined in accordance with GAAP for such period;
     (iii) earnings or losses resulting from any reappraisal, revaluation or
write-up or write-down of assets;

     
 
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     (iv) any one-time increase or decrease to net income that is required to be
recorded because of the adoption of new accounting policies, practices or
standards required by GAAP;
     (v) unrealized gains and losses with respect to Hedging Obligations for
such period; and
     (vi) any extraordinary gain (or extraordinary loss), together with any
related provision for taxes on any such gain (or the tax effect of any such
loss), recorded or recognized by Norf GmbH or any of its Subsidiaries during
such period.
     “Eligible Assignee” shall mean (a) any Lender, (b) an Affiliate of any
Lender, (c) an Approved Fund of a Lender and (d) any other person approved by
the Administrative Agent and Administrative Borrower (each such approval not to
be unreasonably withheld or delayed); provided that (x) no approval of
Administrative Borrower shall be required during the continuance of a Default or
prior to the earlier of (i) three months after the Closing Date or (ii) the
completion of the primary syndication of the Commitments and Loans (as
determined by the Arrangers), (y) “Eligible Assignee” shall not include Holdings
or any of its Affiliates or Subsidiaries or any natural person and (z) each
assignee Lender shall be subject to each other applicable requirement regarding
Lenders hereunder.
     “Embargoed Person” shall have the meaning assigned to such term in
Section 6.21.
     “Environment” shall mean the natural environment, including air (indoor or
outdoor), surface water and groundwater (including potable water, navigable
water and wetlands), the land surface or subsurface strata, natural resources,
the workplace or as otherwise defined in any Environmental Law.
     “Environmental Claim” shall mean any claim, notice, demand, order, action,
suit, proceeding or other communication alleging liability for or obligation
with respect to any investigation, remediation, removal, cleanup, response,
corrective action, damages to natural resources, personal injury, property
damage, fines, penalties or other costs resulting from, related to or arising
out of (i) the presence, Release or threatened Release in or into the
Environment of Hazardous Material at any location or (ii) any violation or
alleged violation of any Environmental Law, and shall include any claim seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from, related to or arising out of the presence,
Release or threatened Release of Hazardous Material or alleged injury or threat
of injury to health, safety or the Environment.
     “Environmental Law” shall mean any and all treaties, laws, statutes,
ordinances, regulations, rules, decrees, orders, judgments, consent orders,
consent decrees, code or other legally binding requirements, and the common law,
relating to protection of public health or the Environment, the Release or
threatened Release of Hazardous Material, natural resources or natural resource
damages, or occupational safety or health, and any and all Environmental
Permits.
     “Environmental Permit” shall mean any permit, license, approval,
registration, notification, exemption, consent or other authorization required
by or from a Governmental Authority under Environmental Law.

     
 
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     “Equipment” shall mean “equipment,” as such term is defined in the UCC as
in effect on the date hereof in the State of New York, in which such Person now
or hereafter has rights.
     “Equity Interest” shall mean, with respect to any person, any and all
shares, interests, participations or other equivalents, including membership
interests (however designated, whether voting or nonvoting), of equity of such
person, including, if such person is a partnership, partnership interests
(whether general or limited) and any other interest or participation that
confers on a person the right to receive a share of the profits and losses of,
or distributions of property of, such partnership, whether outstanding on the
date hereof or issued after the Closing Date, but excluding debt securities
convertible or exchangeable into such equity.
     “Equity Issuance” shall mean, without duplication, (i) any issuance or sale
by Holdings after the Closing Date of any Equity Interests (other than Preferred
Stock) in Holdings (including any Equity Interests (other than Preferred Stock)
issued upon exercise of any warrant or option) or any warrants or options to
purchase Equity Interests (other than Preferred Stock) or (ii) any contribution
to the capital of Holdings.
     “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
the same may be amended from time to time.
     “ERISA Affiliate” shall mean, with respect to any person, any trade or
business (whether or not incorporated) that, together with such person, is
treated as a single employer under Section 414 of the Code.
     “ERISA Event” shall mean (a) any “reportable event,” as defined in
Section 4043 of ERISA or the regulations issued thereunder, with respect to a
Plan (other than an event for which the thirty (30) day notice period is waived
by regulation); (b) the existence with respect to any Plan of an “accumulated
funding deficiency” (as defined in Section 412 of the Code or Section 302 of
ERISA), whether or not waived; (c) the failure to make by its due date a
required installment under Section 412(m) of the Code with respect to any Plan
or the failure to make any required contribution to a Multiemployer Plan;
(d) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA
of an application for a waiver of the minimum funding standard with respect to
any Plan; (e) the incurrence by any Company or any of its ERISA Affiliates of
any liability under Title IV of ERISA with respect to the termination of any
Plan; (f) the receipt by any Company or any of its ERISA Affiliates from the
PBGC or a plan administrator of any notice relating to the intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan, or
the occurrence of any event or condition which could reasonably be expected to
constitute grounds under ERISA for the termination of, or the appointment of a
trustee to administer, any Plan; (g) the incurrence by any Company or any of its
ERISA Affiliates of any liability with respect to the withdrawal from any Plan
or Multiemployer Plan; (h) the receipt by any Company or its ERISA Affiliates of
any notice, concerning the imposition of material Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA; (i) the “substantial
cessation of operations” within the meaning of Section 4062(e) of ERISA with
respect to a Plan; (j) the making of any amendment to any Plan which could
result in the imposition of a lien or the posting of a bond or other security;
and (k) the occurrence of a nonexempt prohibited transaction (within the meaning
of Section 4975 of the Code or

     
 
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Section 406 of ERISA) which could reasonably be expected to result in a Material
Adverse Effect.
     “Eurocurrency Borrowing” shall mean a Borrowing comprised of Eurocurrency
Loans.
     “Eurocurrency Loan” shall mean any Loan bearing interest at a rate
determined by reference to the Adjusted LIBOR Rate in accordance with the
provisions of ARTICLE II.
     “Eurofoil” shall mean Eurofoil Inc. (USA), a New York corporation.
     “European Cash Pooling Arrangements” shall mean the cash pooling
arrangements operated by the Swiss Borrower and certain of the other Companies
pursuant to the Novelis AG Cash Pooling Agreement and the Commerzbank Cash
Pooling Agreement.
     “Event of Default” shall have the meaning assigned to such term in
Section 8.01.
     “Excess Amount” shall have the meaning assigned to such term in
Section 2.10.
     “Excess Availability” shall mean “Excess Availability” as defined in the
Revolving Credit Agreement as in effect on the Closing Date.
     “Excess Cash Flow” shall mean, for any Excess Cash Flow Period,
Consolidated Adjusted EBITDA for such Excess Cash Flow Period, minus, without
duplication:
               (a) Debt Service for such Excess Cash Flow Period;
               (b) (i) any voluntary prepayments of Term Loans, (ii) any
voluntary prepayments of term loans of NKL permitted under Section 6.01(m),
(iii) any voluntary repayments of Revolving Credit Loans to the extent
accompanied by a simultaneous permanent reduction in an equal amount of the
Revolving Credit Commitments (and excluding any such reduction to the extent
relating to the entering into of a replacement Revolving Credit Agreement) and
(iv) any voluntary repayments of revolving Indebtedness of NKL permitted under
Section 6.01(m) to the extent accompanied by a simultaneous permanent reduction
in an equal amount of the commitments in respect of such Indebtedness (and
excluding any such reduction to the extent relating to the entering into of
replacement revolving Indebtedness of NKL), in each case, so long as such
amounts are not already reflected in Debt Service, during such Excess Cash Flow
Period;
               (c) Capital Expenditures during such Excess Cash Flow Period
(excluding Capital Expenditures made in such Excess Cash Flow Period where a
certificate in the form contemplated by the following clause (d) was previously
delivered) that are paid in cash;
               (d) Capital Expenditures that Canadian Borrower or any of its
Subsidiaries shall, during such Excess Cash Flow Period, become obligated to
make but that are not made during such Excess Cash Flow Period; provided that
Canadian Borrower shall deliver a certificate to the Administrative Agent not
later than 90 days after the end of such Excess Cash

     
 
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Flow Period, signed by a Responsible Officer of Canadian Borrower and certifying
that such Capital Expenditures will be made in the following Excess Cash Flow
Period;
               (e) the aggregate amount of Investments made in cash during such
period pursuant to Sections 6.04(e), (h), (l), (m) and (r);
               (f) (i) taxes of Canadian Borrower and its Subsidiaries that were
paid in cash during such Excess Cash Flow Period (excluding taxes paid in such
Excess Cash Flow period where a certificate contemplated by the following clause
(ii) was previously delivered) and (ii) taxes of Canadian Borrower and its
Subsidiaries that will be paid within six months after the end of such Excess
Cash Flow Period and for which reserves have been established; provided that
Borrower shall deliver a certificate to the Administrative Agent not later than
90 days after the end of such Excess Cash Flow Period, signed by a Responsible
Officer of Borrower and certifying that such taxes will be paid within such six
month period;
               (g) the absolute value of the difference, if negative, of the
amount of Net Working Capital at the end of the prior Excess Cash Flow Period
(or, in the case of the Excess Cash Flow Period for the first complete fiscal
year of Canadian Borrower commencing after the Closing Date, at the first day of
such Excess Cash Flow Period) over the amount of Net Working Capital at the end
of such Excess Cash Flow Period;
               (h) to the extent added to determine Consolidated EBITDA and paid
in cash during such Excess Cash Flow Period, restructuring charges in an amount
not to exceed $15 million during the term hereof;
               (i) losses excluded from the calculation of Consolidated EBITDA
by operation of clauses (z)(a) and (z)(f) of the definition thereof that are
paid or realized in cash during such Excess Cash Flow Period;
               (j) Dividends paid in cash to Holdings during such Excess Cash
Flow period in accordance with Section 6.08(c); and
               (k) to the extent added to determine Consolidated EBITDA, all
items that did not result from a cash payment to Canadian Borrower or any of its
Subsidiaries on a consolidated basis during such Excess Cash Flow Period;
provided that any amount deducted pursuant of any of the foregoing clauses that
will be paid after the close of such Excess Cash Flow Period shall not be
deducted again in a subsequent Excess Cash Flow Period; plus, without
duplication:
               (i) the difference, if positive, of the amount of Net Working
Capital at the end of the prior Excess Cash Flow Period (or, in the case of the
Excess Cash Flow Period for the first complete fiscal year of Canadian Borrower
commencing after the Closing Date, at the first day of such Excess Cash Flow
Period) over the amount of Net Working Capital at the end of such Excess Cash
Flow Period;
               (ii) (1) all net cash proceeds received during such Excess Cash
Flow Period of (x) any equity issuance by, or capital contribution to, Holdings,
Canadian

     
 
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Borrower or any other Subsidiary of Canadian Borrower to, or made by, persons
other than Companies and (y) any Indebtedness (other than Revolving Credit
Loans), in each case, to the extent (directly or indirectly) used to finance
(A) Investments made pursuant to Sections 6.04(e), (h), (l), (m) and (r), (B)
voluntary prepayments of term loans of NKL (to the extent such voluntary
repayment of term loans of NKL is deducted from Excess Cash Flow pursuant to
clause (b)(ii) above), (C) voluntary repayments of Revolving Credit Loans (to
the extent such voluntary repayment of Revolving Credit Loans is deducted from
Excess Cash Flow pursuant to clause (b)(iii) above) or (D) voluntary repayments
of revolving Indebtedness of NKL (to the extent such voluntary repayment of
revolving Indebtedness of NKL is deducted from Excess Cash Flow pursuant to
clause (b)(iv) above); (2) all net cash proceeds received during such Excess
Cash Flow Period of (x) any equity issuance by, or capital contribution to,
Holdings, Canadian Borrower or any other Subsidiary of Canadian Borrower to, or
made by, persons other than Companies and (y) any Indebtedness (other than
Revolving Credit Loans), in each case, to the extent used to finance any Capital
Expenditure; and (3) all Net Cash Proceeds of Asset Sales utilized to make
Capital Expenditures in such Excess Cash Flow Period as permitted under
Section 2.10(c);
               (iii) to the extent any permitted Capital Expenditures referred
to in clause (d) above do not occur in the Excess Cash Flow Period specified in
the certificate of Borrower provided pursuant to clause (d) above, such amounts
of Capital Expenditures that were not so made in the Excess Cash Flow Period
specified in such certificates;
               (iv) to the extent any tax payments referred to in clause (f)(ii)
above do not occur in the Excess Cash Flow Period specified in the certificate
of Canadian Borrower provided pursuant to clause (f)(ii) above, such amounts of
tax payments that were not so made in the Excess Cash Flow Period specified in
such certificates;
               (v) to the extent not reflected in Consolidated EBITDA for such
Excess Cash Flow Period, any return on or in respect of Investments received in
cash during such period, which Investments were made pursuant to
Sections 6.04(e), (h), (l), (m) and (r) (excluding any amounts of such
Investments financed with the proceeds of (x) equity issuances by, or capital
contributions to, Holdings, Canadian Borrower or any other Subsidiary of
Canadian Borrower to, or made by, persons other than Companies or
(y) Indebtedness (other than Revolving Credit Loans));
               (vi) if deducted in the computation of Consolidated EBITDA,
interest income;
               (vii) income and gains excluded from the calculation of
Consolidated EBITDA in any period by operation of clauses (z)(a) or (z)(f) of
the definition thereof that are realized in cash during such Excess Cash Flow
Period (other than pursuant to a sale under Section 6.06(k) to the extent that
the proceeds of such sale are reinvested in accordance with Section 6.04(k)
during such Excess Cash Flow Period); and

     
 
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               (viii) to the extent subtracted in determining Consolidated
EBITDA, all items that did not result from a cash payment by Borrower or any of
its Subsidiaries on a consolidated basis during such Excess Cash Flow Period.
     “Excess Cash Flow Period” shall mean each fiscal year of Borrower,
beginning with the first complete fiscal year of Borrower commencing after the
Closing Date.
     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
     “Excluded Collateral Subsidiary” shall mean, at any date of determination,
any Subsidiary designated as such in writing by Administrative Borrower to the
Administrative Agent that, together with all other Subsidiaries constituting
Excluded Collateral Subsidiaries (i) contributed 1.0% or less of Consolidated
EBITDA for the period of four fiscal quarters most recently ended for which
financial statements have been or are required to have been delivered pursuant
to Section 5.01(a) or 5.01(b) prior to the date of determination, (ii) had
consolidated assets representing 1.0% or less of the consolidated total assets
of Canadian Borrower and its Subsidiaries on the last day of the most recent
fiscal quarter ended for which financial statements have been or are required to
have been delivered pursuant to Section 5.01(a) or 5.01(b) prior to the date of
determination, and (iii) is not a Loan Party. The Excluded Collateral
Subsidiaries as of the Closing Date are listed on Schedule 1.01(c).
     “Excluded Subsidiaries” shall mean Subsidiaries of Holdings that (i) are
not Loan Parties and (ii) are not organized in a Principal Jurisdiction.
     “Excluded Taxes” shall mean, with respect to the Agents, any Lender or any
other recipient of any payment to be made by or on account of any obligation of
any Borrower hereunder, (a) taxes imposed on or measured by its overall net
income (however denominated), franchise taxes imposed on it (in lieu of net
income taxes) and branch profits taxes imposed on it, by a jurisdiction (or any
political subdivision thereof) as a result of the recipient being organized or
having its principal office or, in the case of any Lender, its applicable
lending office in such jurisdiction and (b) in the case of a Foreign Lender, any
U.S. federal withholding tax that (i) is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party hereto (or
designates a new lending office), except (x) to the extent that such Foreign
Lender (or its assignor, if any) was entitled, at the time of designation of a
new lending office (or assignment), to receive additional amounts from any
Borrower with respect to such withholding tax pursuant to Section 2.15(a) or
(y) if such Foreign Lender designates a new foreign lending office or is an
assignee pursuant to a request by any Borrower under Section 2.16; provided that
this subclause (b)(i) shall not apply to any Tax imposed on a Lender in
connection with an interest or participation in any Loan or other obligation
that such Lender was required to acquire pursuant to Section 2.14(d), or (ii) is
attributable to such Foreign Lender’s failure to comply with Section 2.15(e).
     “Executive Order” shall have the meaning assigned to such term in
Section 3.22.
     “Existing Lien” shall have the meaning assigned to such term in
Section 6.02(c).
     “Federal Funds Effective Rate” shall mean, for any day, the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System of the

     
 
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United States arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day for such transactions received by the Administrative
Agent from three federal funds brokers of recognized standing selected by it.
     “Fee Letter” shall mean that certain fee letter among Canadian Borrower,
the Arrangers, ABN AMRO, and UBS Loan Finance LLC, dated as of May 25, 2007, as
the same may be amended, amended and restated, supplemented, revised or modified
from time to time.
     “Fees” shall mean the fees payable hereunder or under the Fee Letter.
     “Final Maturity Date” shall mean July 6, 2014.
     “Financial Officer” of any person shall mean the chief financial officer,
principal accounting officer, treasurer or controller of such person.
     “Financial Support Direction” shall mean a financial support direction
issued by the Pensions Regulator under Section 43 of the Pensions Act 2004.
     “FIRREA” shall mean the Federal Institutions Reform, Recovery and
Enforcement Act of 1989, as amended.
     “First Priority” means, with respect to any Lien purported to be created in
any Collateral pursuant to any Security Document, that such Lien is the most
senior Lien to which such Collateral is subject, other than Permitted Liens of
the type described in Section 6.02(a), (b), (c), (d), (f), (g), (h), (i), (j),
(k) (to the extent provided in the Intercreditor Agreement), (n), (o), (q), (r),
(s) and (t) which have priority over the Liens granted pursuant to the Security
Documents (and in each case, subject to the proviso to Section 6.02).
     “Foreign Guarantee” shall have the meaning assigned to such term in
Section 7.01.
     “Foreign Lender” shall mean any Lender that is not, for United States
federal income tax purposes, (i) an individual who is a citizen or resident of
the United States, (ii) a corporation, partnership or other entity treated as a
corporation or partnership created or organized in or under the laws of the
United States, or any political subdivision thereof, (iii) an estate whose
income is subject to U.S. federal income taxation regardless of its source or
(iv) a trust if a court within the United States is able to exercise primary
supervision over the administration of such trust and one or more United States
persons have the authority to control all substantial decisions of such trust or
a trust that properly elected to be treated as a United States person.
     “Foreign Plan” shall mean any pension or other employee benefit or
retirement plan, program, policy, arrangement or agreement maintained or
contributed to by any Company with respect to employees employed outside the
United States.
     “Foreign Subsidiary” shall mean a Subsidiary that is organized under the
laws of a jurisdiction other than the United States or any state thereof or the
District of Columbia.

     
 
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     “Fund” shall mean any person that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course.
     “Funded Debt” shall mean, as to any person, all Indebtedness of such person
that matures more than one year from the date of its creation or matures within
one year from such date but is renewable or extendible, at the option of such
person, to a date more than one year from such date or arises under a revolving
credit or similar agreement that obligates the lender or lenders to extend
credit during a period of more than one year from such date, including all
current maturities and current sinking fund payments in respect of such
Indebtedness whether or not required to be paid within one year from the date of
its creation and, in the case of Canadian Borrower and its Subsidiaries,
Indebtedness in respect of the Loans and the Revolving Credit Loans.
     “GAAP” shall mean generally accepted accounting principles in the United
States applied on a consistent basis.
     “GBP” or “£” shall mean lawful money of the United Kingdom.
     “German Guarantor” shall mean each Subsidiary of Holdings organized in
Germany party hereto as a Guarantor, and each other Subsidiary of Holdings
organized in Germany that is required to become a Guarantor pursuant to the
terms hereof.
     “German Security Agreement” shall mean, collectively, any Security
Agreement substantially in the form of Exhibits M-5-1 to 7 among the German
Guarantors and the Collateral Agent for the benefit of the Secured Parties.
     “German Seller” shall mean Novelis Deutschland GmbH, a company organized
under the laws of Germany (including in its roles as seller and collection agent
under the Receivables Purchase Agreement).
     “Governmental Authority” shall mean the government of the United States or
any other nation, or of any political subdivision thereof, whether state,
provincial or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government (including any supra-national bodies such as the
European Union or the European Central Bank).
     “Governmental Real Property Disclosure Requirements” shall mean any
Requirement of Law of any Governmental Authority requiring notification of the
buyer, lessee, mortgagee, assignee or other transferee of any Real Property,
facility, establishment or business, or notification, registration or filing to
or with any Governmental Authority, in connection with the sale, lease,
mortgage, assignment or other transfer (including any transfer of control) of
any Real Property, facility, establishment or business, of the actual or
threatened presence or Release in or into the Environment, or the use, disposal
or handling of Hazardous Material on, at, under or near the Real Property,
facility, establishment or business to be sold, leased, mortgaged, assigned or
transferred.

     
 
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     “Guarantee Payment” shall have the meaning assigned to such term in
Section 7.12(b).
     “Guaranteed Obligations” shall have the meaning assigned to such term in
Section 7.01.
     “Guarantees” shall mean the guarantees issued pursuant to ARTICLE VII by
the Guarantors.
     “Guarantors” shall mean each Borrower, Holdings and the Subsidiary
Guarantors (including the U.S. Borrower, Canadian Borrower, Holdings and each
other Canadian Guarantor, each U.S. Guarantor, each Swiss Guarantor, each U.K.
Guarantor, the German Guarantor, the Irish Guarantor, the Brazilian Guarantor,
and each other Subsidiary of Holdings that is required to become a Guarantor
hereunder).
     “Hazardous Materials” shall mean the following: hazardous substances;
hazardous wastes; polychlorinated biphenyls (“PCBs”) or any substance or
compound containing PCBs; asbestos or any asbestos-containing materials in any
form or condition; radon or any other radioactive materials including any
source, special nuclear or by-product material; petroleum, crude oil or any
fraction thereof; and any other pollutant or contaminant or chemicals, wastes,
materials, compounds, constituents or substances, subject to regulation under or
which can give rise to liability under any Environmental Laws.
     “Hedging Agreement” shall mean any swap, cap, collar, forward purchase or
similar agreements or arrangements dealing with interest rates, currency
exchange rates or commodity prices, either generally or under specific
contingencies entered into for the purposes of hedging a Company’s exposure to
interest or exchange rates, loan credit exchanges, security or currency
valuations or commodity prices, in each case not for speculative purposes.
     “Hedging Obligations” shall mean obligations under or with respect to
Hedging Agreements.
     “Hindalco Acquisition” shall have the meaning assigned to such term in the
recitals hereto.
     “Holdings” shall mean (i) prior to the consummation of the Permitted
Holdings Amalgamation, AV Aluminum, and (ii) upon and after the consummation of
the Permitted Holdings Amalgamation, AV Metals.
     “Immaterial Subsidiary” shall mean, at any date of determination, any
Subsidiary designated as such in writing by Administrative Borrower to the
Administrative Agent that, together with all other Subsidiaries constituting
Immaterial Subsidiaries (i) contributed 5.0% or less of Consolidated EBITDA for
the period of four fiscal quarters most recently ended for which financial
statements have been or are required to have been delivered pursuant to
Section 5.01(a) or 5.01(b) prior to the date of determination, (ii) had
consolidated assets representing 5.0% or less of the consolidated total assets
of Canadian Borrower and its Subsidiaries on the last day of the most recent
fiscal quarter ended for which financial statements have been or are required to
have been delivered pursuant to Section 5.01(a) or 5.01(b) prior to the date of

     
 
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determination, and (iii) is not a Loan Party. The Immaterial Subsidiaries as of
the Closing Date are listed on Schedule 1.01(d).
     “Increase Effective Date” shall have the meaning assigned to such term in
Section 2.23(a).
     “Increase Joinder” shall have the meaning assigned to such term in
Section 2.23(c).
     “Incremental Term Loan” shall have the meaning assigned to such term in
Section 2.23(c).
     “Incremental Term Loan Commitment” shall have the meaning assigned to such
term in Section 2.23(a).
     “Incremental Term Loan Maturity Date” shall have the meaning assigned to
such term in Section 2.23(c).
     “Indebtedness” of any person shall mean, without duplication, (a) all
obligations of such person for borrowed money or advances; (b) all obligations
of such person evidenced by bonds, debentures, notes or similar instruments;
(c) all obligations of such person under conditional sale or other title
retention agreements relating to property purchased by such person; (d) all
obligations of such person issued or assumed as the deferred purchase price of
property or services (excluding trade accounts payable and accrued obligations
incurred in the ordinary course of business on normal trade terms and not
overdue by more than ninety (90) days (other than such overdue trade accounts
payable being contested in good faith and by proper proceedings, for which
appropriate reserves are being maintained with respect to such circumstances in
accordance with GAAP or other applicable accounting standards)); (e) all
Indebtedness of others secured by any Lien on property owned or acquired by such
person, whether or not the obligations secured thereby have been assumed, but
limited to the fair market value of such property; (f) all Capital Lease
Obligations, Purchase Money Obligations and synthetic lease obligations of such
person; (g) all Hedging Obligations to the extent required to be reflected on a
balance sheet of such person; (h) all Attributable Indebtedness of such person;
(i) all obligations of such person for the reimbursement of any obligor in
respect of letters of credit, letters of guaranty, bankers’ acceptances and
similar credit transactions; (j) all obligations of such person under any
Securitization Facility; and (k) all Contingent Obligations of such person in
respect of Indebtedness or obligations of others of the kinds referred to in
clauses (a) through (j) above. The Indebtedness of any person shall include the
Indebtedness of any other entity (including any partnership in which such person
is a general partner) to the extent such person is liable therefor as a result
of such person’s ownership interest in or other relationship with such entity,
except (other than in the case of general partner liability) to the extent that
terms of such Indebtedness expressly provide that such person is not liable
therefor.
     “Indemnified Taxes” shall mean all Taxes other than Excluded Taxes.
     “Indemnitee” shall have the meaning assigned to such term in
Section 11.03(b).
     “Information” shall have the meaning assigned to such term in
Section 11.12.

     
 
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     “Instruments” shall mean all “instruments,” as such term is defined in the
UCC as in effect on the date hereof in the State of New York, in which any
Person now or hereafter has rights.
     “Insurance Policies” shall mean the insurance policies and coverages
required to be maintained by each Loan Party which is an owner of Mortgaged
Property with respect to the applicable Mortgaged Property pursuant to
Section 5.04 and all renewals and extensions thereof.
     “Insurance Requirements” shall mean, collectively, all provisions of the
Insurance Policies, all requirements of the issuer of any of the Insurance
Policies and all orders, rules, regulations and any other requirements of the
National Board of Fire Underwriters (or any other body exercising similar
functions) binding upon each Loan Party which is an owner of Mortgaged Property
and applicable to the Mortgaged Property or any use or condition thereof.
     “Intellectual Property” shall have the meaning assigned to such term in
Section 3.06(a).
     “Interbank Rate” shall mean, for any period, (i) in respect of Loans
denominated in dollars, the Federal Funds Effective Rate, and (ii) in respect of
Loans denominated in any other currency, the Administrative Agent’s cost of
funds for such period.
     “Intercompany Note” shall mean a promissory note substantially in the form
of Exhibit P, or such other form as may be agreed to by the Administrative Agent
in its sole discretion.
     “Intercreditor Agreement” shall mean that certain Intercreditor Agreement
dated as of the date hereof by and among the Companies party thereto, the
Administrative Agent, the Collateral Agent, the Revolving Credit Funding Agent,
the Revolving Credit Canadian Administrative Agent, the Revolving Credit
Canadian Administrative Agent and the Revolving Credit Collateral Agent, as the
same may be amended, restated, supplemented or otherwise modified from time to
time.
     “Interest Election Request” shall mean a request by Administrative Borrower
to convert or continue a Borrowing in accordance with Section 2.08(b),
substantially in the form of Exhibit E.
     “Interest Payment Date” shall mean (a) with respect to any ABR Loan, the
last Business Day of each March, June, September and December to occur during
any period in which such Loan is outstanding, (b) with respect to any
Eurocurrency Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part and, in the case of a Eurocurrency Loan
with an Interest Period of more than three months’ duration, each day prior to
the last day of such Interest Period that occurs at intervals of three months’
duration after the first day of such Interest Period, and (c) with respect to
any Term Loan, the Final Maturity Date.
     “Interest Period” shall mean, with respect to any Eurocurrency Borrowing,
the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months, as Administrative Borrower may elect; provided that (a) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next

     
 
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succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the immediately preceding Business Day,
(b) any Interest Period that commences on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
last calendar month of such Interest Period) shall end on the last Business Day
of the last calendar month of such Interest Period, (c) Administrative Borrower
shall not select a Interest Period that would extend beyond the Final Maturity
Date, (d) Administrative Borrower shall not select Interest Periods so as to
require a payment or prepayment of any Eurocurrency Loans during an Interest
Period for such Loans and (e) any Eurocurrency Borrowings made or continued
during the period ending on the earlier of (x) three months following the
Closing Date and (y) the completion of the primary syndication of the
Commitments (as determined by the Arrangers), shall have a Interest Period of
one month. For purposes hereof, the date of a Borrowing initially shall be the
date on which such Borrowing is made and thereafter shall be the effective date
of the most recent conversion or continuation of such Borrowing.
     “Inventory” shall mean all “inventory,” as such term is defined in the UCC
as in effect on the date hereof in the State of New York, wherever located, in
which any Person now or hereafter has rights.
     “Investments” shall have the meaning assigned to such term in Section 6.04.
     “Irish Guarantor” shall mean each Subsidiary of Holdings organized in
Ireland party hereto as a Guarantor, and each other Subsidiary of Holdings
organized in Ireland that is required to become a Guarantor pursuant to the
terms hereof.
     “Irish Security Agreement” shall mean, collectively, any Security Agreement
substantially in the form of Exhibits M-6-1 to 5 among the Irish Guarantors and
the Collateral Agent for the benefit of the Secured Parties.
     “Joinder Agreement” shall mean a joinder agreement substantially in the
form of Exhibit F, or such other form as may be agreed to by the Administrative
Agent in its sole discretion.
     “Joint Venture” shall mean any person (a) that is not a direct or indirect
Subsidiary of Holdings and (b) in which Canadian Borrower, in the aggregate,
together with its Subsidiaries, is directly or indirectly, the beneficial owner
of 5% or more of any class of Equity Interests of such person.
     “Joint Venture Subsidiary” shall mean each of (i) Aluminum Company of
Malaysia Berhard (Malaysia), (ii) NKL and (iii) any other person that is a
Subsidiary in which persons other than Holdings or its Affiliates own 10% or
more of the Equity Interests of such person, excluding Logan and Norf GmbH.
     “Judgment Currency” shall have the meaning assigned to such term in
Section 11.18(a).
     “Judgment Currency Conversion Date” shall have the meaning assigned to such
term in Section 11.18(a).

     
 
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     “Land Registry” shall mean the Land Registry of England and Wales.
     “Landlord Access Agreement” shall mean a Landlord Access Agreement,
substantially in the form of Exhibit G, or such other form as may reasonably be
acceptable to the Administrative Agent.
     “Leases” shall mean any and all leases, subleases, tenancies, options,
concession agreements, rental agreements, occupancy agreements, franchise
agreements, access agreements and any other agreements (including all
amendments, extensions, replacements, renewals, modifications and/or guarantees
thereof), whether or not of record and whether now in existence or hereafter
entered into, affecting the use or occupancy of all or any portion of any Real
Property.
     “Lender Addendum” shall mean with respect to any Lender on the Closing
Date, a lender addendum in the form of Exhibit I, to be executed and delivered
by such Lender on the Closing Date as provided in Section 11.15, as the same may
be amended, restated, supplemented or otherwise modified from time to time.
     “Lenders” shall mean (a) the financial institutions that have become a
party hereto pursuant to a Lender Addendum and (b) any financial institution
that has become a party hereto pursuant to an Assignment and Assumption, other
than, in each case, any such financial institution that has ceased to be a party
hereto pursuant to an Assignment and Assumption.
     “LIBOR Rate” shall mean, with respect to any Eurocurrency Borrowing for any
Interest Period, the rate per annum determined by the Administrative Agent to be
the arithmetic mean of the offered rates for deposits in Dollars with a term
comparable to such Interest Period that appears on the Telerate British Bankers
Assoc. Interest Settlement Rates Page (as defined below) at approximately
11:00 a.m., London, England time, on the second full Business Day preceding the
first day of such Interest Period; provided, however, that (i) if no comparable
term for an Interest Period is available, the LIBOR Rate shall be determined
using the weighted average of the offered rates for the two terms most nearly
corresponding to such Interest Period and (ii) if there shall at any time no
longer exist a Telerate British Bankers Assoc. Interest Settlement Rates Page,
“LIBOR Rate” shall mean, with respect to each day during each Interest Period
pertaining to Eurocurrency Borrowings comprising part of the same Borrowing, the
rate per annum equal to the rate at which the Administrative Agent is offered
deposits in Dollars at approximately 11:00 a.m., London, England time, two
(2) Business Days prior to the first day of such Interest Period in the London
interbank market for delivery on the first day of such Interest Period for the
number of days comprised therein and in an amount comparable to the amount of
such Eurocurrency Borrowing to be outstanding during such Interest Period (or
such other amount as the Administrative Agent may reasonably determine).
“Telerate British Bankers Assoc. Interest Settlement Rates Page” shall mean the
display designated as Page 3750 on the Telerate System Incorporated Service (or
such other page as may replace such page on such service for the purpose of
displaying the rates at which Dollar deposits are offered by leading banks in
the London interbank deposit market).
     “Lien” shall mean, with respect to any property, (a) any mortgage, deed of
trust, lien, pledge, encumbrance, charge, assignment, hypothecation, security
interest or similar

     
 
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encumbrance of any kind or any arrangement to provide priority or preference in
respect of such property or any filing of any financing statement or any
financing change statement under the UCC, the PPSA or any other similar notice
of lien under any similar notice or recording statute of any Governmental
Authority (other than any unauthorized notice or filing filed after the Closing
Date for which there is not otherwise any underlying lien or obligation, so long
as the Borrowers are (if aware of same) using commercially reasonable efforts to
cause the removal of same), including any easement, right-of-way or other
encumbrance on title to Real Property, in each of the foregoing cases whether
voluntary or imposed by law, and any agreement to give any of the foregoing;
(b) the interest of a vendor or a lessor under any conditional sale agreement,
capital lease or title retention agreement (or any financing lease having
substantially the same economic effect as any of the foregoing) relating to such
property; and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.
     “Loan Documents” shall mean this Agreement, the Intercreditor Agreement,
the Contribution, Intercompany, Contracting and Offset Agreement, the Notes (if
any), the Security Documents, each Foreign Guaranty, the Fee Letter, each
Hedging Agreement entered into with any counterparty that is a Secured Party
(provided that such Hedging Agreements shall be deemed not to be Loan Documents
for purposes of Sections 1.03 and 1.04 and Articles II, VI, VIII and XI hereof),
and all other pledges, powers of attorney, consents, assignments, certificates,
agreements or documents, whether heretofore, now or hereafter executed by or on
behalf of any Loan Party for the benefit of any Agent or any Lender in
connection with this Agreement.
     “Loan Parties” shall mean Holdings, the Borrowers and the Subsidiary
Guarantors.
     “Loans” shall mean Term Loans.
     “Logan” shall mean Logan Aluminum Inc., a Delaware corporation.
     “Logan Location” shall mean the premises of Logan Aluminum Inc., Route 431,
North Russellville, Kentucky 42276.
     “Mandatory Cost” shall mean the per annum percentage rate calculated by the
Administrative Agent in accordance with Annex III.
     “Margin Stock” shall have the meaning assigned to such term in
Regulation U.
     “Material Adverse Effect” shall mean (a) a material adverse effect on the
business, property, results of operations, or financial condition of the Loan
Parties and their Subsidiaries, taken as a whole; (b) material impairment of the
ability of the Loan Parties to perform their payment and other material
obligations under the Loan Documents; (c) material impairment of the rights of
or benefits or remedies available to the Lenders or the Collateral Agent under
the Loan Documents, taken as a whole; or (d)(i) a material adverse effect on the
Revolving Credit Priority Collateral or the Liens in favor of the Collateral
Agent (for its benefit and for the benefit of the other Secured Parties) on such
Collateral or the priority of such Liens, in each case for this clause (d)(i)
taken as a whole, or (ii) a material adverse effect on the Term Loan Priority
Collateral or the Liens in favor of the Collateral Agent (for its benefit and
for the benefit of the

     
 
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other Secured Parties) on such Collateral or the priority of such Liens, in each
case for this clause (d)(ii) taken as a whole.
     “Material Indebtedness” shall mean (a) Indebtedness under the Revolving
Credit Loan Documents and any Permitted Revolving Credit Facility Refinancings
thereof, (b) Indebtedness under the Senior Notes, the Subordinated Debt Loan and
any Permitted Refinancings thereof and (c) any other Indebtedness (other than
the Loans and intercompany Indebtedness of the Companies permitted hereunder) of
the Loan Parties in an aggregate outstanding principal amount exceeding
$50 million.
     “Material Subsidiary” shall mean any Subsidiary of Canadian Borrower that
is not an Immaterial Subsidiary.
     “Maximum Rate” shall have the meaning assigned to such term in
Section 11.14.
     “Maximum Revolving Credit Facility Amount” shall mean, at any time, the
greater of (i) $900 million and (ii) the amount, at such time, of the Total
Borrowing Base under and as defined in the Revolving Credit Agreement as in
effect on the Closing Date.
     “Minimum Amount” shall mean (i) an integral multiple of $1 million and not
less than $5 million for ABR Loans and (ii) an integral multiple of $1 million
and not less than $5 million for Eurocurrency Loans.
     “Moody’s” shall mean Moody’s Investors Service, Inc.
     “Mortgage” shall mean an agreement, including, but not limited to, a
mortgage, charge, deed of trust, deed of hypothec or any other document,
creating and evidencing a Lien on a Mortgaged Property, which shall be
substantially in the form of Exhibit J or, subject to the terms of the
Intercreditor Agreement, other form reasonably satisfactory to the Collateral
Agent, in each case, with such schedules and including such provisions as shall
be necessary to conform such document to applicable local or foreign law or as
shall be customary under applicable local or foreign law.
     “Mortgaged Property” shall mean (a) each Real Property identified as a
Mortgaged Property on Schedule 8(a) to any Perfection Certificate dated the
Closing Date, (b) each future Real Property covered by the terms of any
Mortgage, and (c) each Real Property, if any, which shall be subject to a
Mortgage (or other Lien created by a Security Document) delivered after the
Closing Date pursuant to Section 5.11(c).
     “Multiemployer Plan” shall mean a multiemployer plan within the meaning of
Section 4001(a)(3) or Section 3(37) of ERISA (a) to which any Company or any
ERISA Affiliate is then making or accruing an obligation to make contributions;
(b) to which any Company or any ERISA Affiliate has within the preceding five
plan years made contributions; or (c) with respect to which any Company could
incur liability.
     “Net Cash Proceeds” shall mean:

     
 
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     (a) with respect to any Asset Sale, the cash proceeds received by Holdings
or any of its Subsidiaries (including cash proceeds subsequently received (as
and when received by Holdings or any of its Subsidiaries) in respect of non-cash
consideration initially received) net of (without duplication) (i) selling
expenses (including reasonable brokers’ fees or commissions, legal, accounting
and other professional and transactional fees, transfer and similar taxes and
Administrative Borrower’s good faith estimate of income taxes paid or payable in
connection with such sale and repatriation Taxes that are or would be payable in
connection with any sale by a Foreign Subsidiary); (ii) amounts provided as a
reserve, in accordance with GAAP, against (x) any liabilities under any
indemnification obligations associated with such Asset Sale or (y) any other
liabilities retained by Holdings or any of its Subsidiaries associated with the
properties sold in such Asset Sale (provided that, to the extent and at the time
any such amounts are released from such reserve, such amounts shall constitute
Net Cash Proceeds); (iii) Administrative Borrower’s good faith estimate of
payments required to be made with respect to unassumed liabilities relating to
the properties sold within ninety (90) days of such Asset Sale (provided that,
to the extent such cash proceeds are not used to make payments in respect of
such unassumed liabilities within ninety (90) days of such Asset Sale, such cash
proceeds shall constitute Net Cash Proceeds); (iv) the principal amount, premium
or penalty, if any, interest and other amounts on any Indebtedness for borrowed
money (other than the Revolving Credit Loans) which is secured by a Lien on the
properties sold in such Asset Sale (so long as such Lien was permitted to
encumber such properties under the Loan Documents at the time of such sale) and
which is repaid with such proceeds (other than any such Indebtedness assumed by
the purchaser of such properties); and (v) so long as any Revolving Credit Loans
remain outstanding, the proceeds of any Revolving Credit Priority Collateral of
any Loan Party sold in such Asset Sale (which shall include, for the avoidance
of doubt, the portion of the sale price of the Equity Interests or all or
substantially all of the property, assets or business of any Subsidiary of
Holdings consisting of the net book value of any such Revolving Credit Priority
Collateral) to the extent the proceeds thereof are required to be (and are)
applied to the repayment of the Revolving Credit Loans pursuant to the terms of
the Revolving Credit Agreement;
     (b) with respect to any Debt Issuance or any Preferred Stock Issuance, the
cash proceeds thereof, net of customary fees, commissions, costs and other
expenses incurred in connection therewith; and
     (c) with respect to any Equity Issuance or any other issuance of Equity
Interests (other than Preferred Stock) by Holdings, the cash proceeds thereof,
net of customary fees, commissions, costs and other expenses incurred in
connection therewith; and
     (d) with respect to any Casualty Event, the cash insurance proceeds,
condemnation awards and other compensation received in respect thereof, net of
(i) all reasonable costs and expenses incurred in connection with the collection
of such proceeds, awards or other compensation in respect of such Casualty
Event; and (ii) so long as any Revolving Credit Loans remain outstanding, any
such cash insurance proceeds, condemnation awards and other compensation
received in respect of Revolving

     
 
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Credit Priority Collateral of any Loan Party to the extent such amounts are
required to be (and are) applied to the repayment of the Revolving Credit Loans
pursuant to the terms of the Revolving Credit Agreement;
provided, however, that Net Cash Proceeds arising from any Asset Sale, Preferred
Stock Issuance or Casualty Event by or applicable to a non-Wholly Owned
Subsidiary shall equal the amount of such Net Cash Proceeds calculated as
provided above less the percentage thereof equal to the percentage of any Equity
Interests of such non-Wholly Owned Subsidiary not owned by Holdings and its
Subsidiaries.
     “Net Cash Proceeds Account” means any segregated Deposit Account or
Securities Account established by any Borrower or any other Guarantor with one
or more financial institutions reasonably satisfactory to the Collateral Agent
(which, in the case of an account established by Canadian Borrower, shall not be
a Lender or an Affiliate of a Lender) that (i) is subject to a Control
Agreement, (ii) is subject to a First Priority security interest in favor of the
Collateral Agent for the ratable benefit of the Secured Parties to secure the
Secured Obligations and (iii) solely contains proceeds of Term Loan Priority
Collateral (and any products of such proceeds), and which has been designated in
writing to the Revolving Credit Agents as a “Net Cash Proceeds Account” on or
prior to the time that the Net Cash Proceeds from any sale of Term Loan Priority
Collateral shall be deposited therein, pending application of such proceeds (and
any products of such proceeds) in accordance with the terms hereof.
     “Net Working Capital” shall mean, at any time, Consolidated Current Assets
at such time minus Consolidated Current Liabilities at such time.
     “Net Yield” shall have the meaning assigned to such term in
Section 2.23(c).
     “NKL” shall mean Novelis Korea Limited.
     “Non-Guarantor Subsidiary” shall mean each Subsidiary that is not a
Guarantor.
     “Norf GmbH” shall mean Aluminium Norf GmbH, a limited liability company
(GmbH) organized under the laws of Germany.
     “Notes” shall mean any notes evidencing the U.S. Term Loans or Canadian
Terms Loans issued pursuant to this Agreement, if any, substantially in the form
of Exhibit K-1 or K-2.
     “Novelis AG” shall mean Novelis AG, a stock corporation (AG) organized
under the laws of Switzerland.
     “Novelis AG Cash Pooling Agreement” shall mean a Cash Management Agreement
entered into among Novelis AG and certain “European Affiliates” (as identified
therein) dated 1 February 2007, together with all ancillary documentation
thereto.
     “Novelis Corporation” shall mean Novelis Corporation, a Texas corporation.
     “Novelis Inc.” shall mean Novelis Inc., a corporation formed under the
Canada Business Corporations Act.

     
 
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     “Obligation Currency” shall have the meaning assigned to such term in
Section 11.18(a).
     “Obligations” shall mean (a) obligations of the Borrowers and the other
Loan Parties from time to time arising under or in respect of the due and
punctual payment of (i) the principal of and premium, if any, and interest
(including interest accruing (and interest that would have accrued but for such
proceeding) during the pendency of any bankruptcy, insolvency, receivership or
other similar proceeding, regardless of whether allowed or allowable in such
proceeding) on the Loans, when and as due, whether at maturity, by acceleration,
upon one or more dates set for prepayment or otherwise and (ii) all other
monetary obligations, including fees, costs, expenses and indemnities, whether
primary, secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), of the Borrowers and the other Loan Parties under
this Agreement and the other Loan Documents, and (b) the due and punctual
performance of all covenants, agreements, obligations and liabilities of the
Borrowers and the other Loan Parties under or pursuant to this Agreement and the
other Loan Documents.
     “OFAC” shall have the meaning assigned to such term in Section 3.22.
     “Officers’ Certificate” shall mean a certificate executed by a Responsible
Officer in his or her official (and not individual) capacity.
     “Organizational Documents” shall mean, with respect to any person, (i) in
the case of any corporation, the certificate of incorporation and by-laws (or
similar documents) of such person, (ii) in the case of any limited liability
company, the certificate of formation and operating agreement (or similar
documents) of such person, (iii) in the case of any limited partnership, the
certificate of formation and limited partnership agreement (or similar
documents) of such person, (iv) in the case of any general partnership, the
partnership agreement (or similar document) of such person and (v) in any other
case, the functional equivalent of the foregoing.
     “Other Taxes” shall mean all present or future stamp, recording,
documentary, excise, transfer, sales, property or similar taxes, charges or
levies arising from any payment made hereunder or under any other Loan Document
or from the execution, delivery or enforcement of, or otherwise with respect to,
this Agreement or any other Loan Document.
     “Parent Guarantor” shall mean (i) prior to the consummation of the
Permitted Holdings Amalgamation, AV Aluminum, and (ii) upon and after the
consummation of the Permitted Holdings Amalgamation, AV Metals.
     “Participant” shall have the meaning assigned to such term in
Section 11.04(d).
     “Participating Member States” shall mean the member states of the European
Communities that adopt or have adopted the euro as their lawful currency in
accordance with the legislation of the European Union relating to European
Monetary Union.
     “PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA.

     
 
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     “Pensions Regulator” shall mean the body corporate called the Pensions
Regulator established under Part I of the Pensions Act 2004.
     “Perfection Certificate” shall mean, individually and collectively, as the
context may require, each certificate of a Loan Party in the form of Exhibit L-1
or any other form approved by the Collateral Agent, as the same shall be
supplemented from time to time by a Perfection Certificate Supplement or
otherwise.
     “Perfection Certificate Supplement” shall mean a certificate supplement in
the form of Exhibit L-2 or any other form approved by the Collateral Agent.
     “Permitted Acquisition” shall mean any Acquisition, if each of the
following conditions is met:
     (i) no Default is then continuing or would result therefrom;
     (ii) no Company shall, in connection with any such transaction, assume or
remain liable with respect to any Indebtedness of the related seller or the
business, person or properties acquired, except to the extent permitted under
Section 6.01, and any other such Indebtedness not permitted to be assumed or
otherwise supported by any Company hereunder shall be paid in full or released
as to the business, persons or properties being so acquired on or before the
consummation of such acquisition;
     (iii) the person or business to be acquired shall be, or shall be engaged
in, a business of the type that the Loan Parties and the Subsidiaries are
permitted to be engaged in under Section 6.15, and the person or business and
any property acquired in connection with any such transaction shall be free and
clear of any Liens, other than Permitted Liens;
     (iv) the Board of Directors of the person to be acquired shall not have
indicated publicly its opposition to the consummation of such acquisition (which
opposition has not been publicly withdrawn);
     (v) all transactions in connection therewith shall be consummated in all
material respects in accordance with all applicable Requirements of Law;
     (vi) with respect to any transaction involving Acquisition Consideration of
more than $25 million, unless the Administrative Agent shall otherwise agree,
Administrative Borrower shall have provided the Administrative Agent with
(A) ten (10) Business Days’ prior written notice of such transaction, which
notice shall describe in reasonable detail the terms and conditions of such
transaction and the person or business to be acquired and (B) all such other
information and data relating to such transaction or the person or business to
be acquired as may be reasonably requested by the Administrative Agent;
     (vii) the property acquired in connection with any such transaction shall
be made subject to the Lien of the Security Documents, and any person acquired
in connection with any such transaction shall become a Guarantor, in each case,
to the

     
 
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extent required under, and within the relevant time periods provided in, Section
5.11, on terms reasonably satisfactory to the Agents, and the Agents shall have
received all opinions, certificates, lien search results and other documents in
connection therewith reasonably requested by the Agents;
     (viii) with respect to any transaction involving Acquisition Consideration
that, when added to the fair market value of Equity Interests, including Equity
Interests of Holdings, constituting purchase consideration, exceeds $10 million,
Administrative Borrower shall have delivered to the Administrative Agent an
Officers’ Certificate certifying that (A) such transaction complies with this
definition and (B) such transaction could not reasonably be expected to result
in a Material Adverse Effect;
     (ix) the Acquisition Consideration for such acquisition shall not exceed
$250 million, and the aggregate amount of the Acquisition Consideration for all
Permitted Acquisitions since the Closing Date shall not exceed $500 million; and
     (x) not more than 35% of the aggregate amount of all such Permitted
Acquisitions (as determined by reference to the aggregate amount of the
Acquisition Consideration applied in respect thereof) shall be of persons that
do not become Loan Parties in accordance with Section 5.11 upon consummation of
such Permitted Acquisitions.
     “Permitted Factoring Facility” shall mean a sale of Accounts on a
discounted basis by any Company that is not a Borrower and is not organized
under the laws of, and does not conduct business in, a Principal Jurisdiction,
so long as (i) no Loan Party has any obligation, contingent or otherwise in
connection with such sale (other than to deliver the Accounts purported to be
sold free and clear of any encumbrance), and (ii) such sale is for cash and fair
market value.
     “Permitted Holdings Amalgamation” shall mean the amalgamation of AV
Aluminum and Canadian Borrower on a single occasion following the Closing Date;
provided that (i) no Default exists or would result therefrom, (ii) the person
resulting from such amalgamation shall be named Novelis Inc., and shall be a
corporation formed under the Canada Business Corporations Act (such resulting
person, the “Successor Canadian Borrower”), and the Successor Canadian Borrower
shall expressly confirm its obligations as Canadian Borrower under this
Agreement and the other Loan Documents to which Canadian Borrower is a party
pursuant to a confirmation in form and substance reasonably satisfactory to the
Administrative Agent, (iii) immediately upon consummation of such amalgamation,
AV Metals shall (A) be an entity organized or existing under the laws of Canada,
(B) directly own 100% of the Equity Interests in the Successor Canadian
Borrower, (C) execute a supplement or joinder to this Agreement in form and
substance reasonably satisfactory to the Administrative Agent to become a
Guarantor and execute Security Documents (or supplements or joinder agreements
thereto) in form and substance reasonably satisfactory to the Administrative
Agent, and take all actions necessary or advisable in the opinion of the
Administrative Agent or the Collateral Agent to cause the Lien created by the
applicable Security Documents to be a duly perfected First Priority Lien in
accordance with all applicable Requirements of Law, including the filing of
financing statements (or other applicable filings) in such jurisdictions as may
be reasonably requested by

     
 
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the Administrative Agent or the Collateral Agent and (D) subject to the terms of
the Intercreditor Agreement, pledge and deliver to the Collateral Agent the
certificates, if any, representing all of the Equity Interests of the Successor
Canadian Borrower, together with undated stock powers or other appropriate
instruments of transfer executed and delivered in blank by a duly authorized
officer of AV Metals, (iv) immediately after giving effect to any such
amalgamation, the Senior Secured Leverage Ratio is not greater than the Senior
Secured Leverage Ratio immediately prior to such amalgamation, and evidenced by
a certificate from the chief financial officer of Canadian Borrower
demonstrating such compliance calculation in reasonable detail, (v) the
Successor Canadian Borrower shall have no Indebtedness after giving effect to
the Permitted Holdings Amalgamation other than Indebtedness of Canadian Borrower
in existence prior to the date of the Permitted Holdings Amalgamation and the
Subordinated Debt Loan so long as the Subordinated Debt Loan shall have been
amended in a manner satisfactory to the Funding Agent to reflect the
subordination of the Subordinated Debt Loan to Canadian Borrower’s Secured
Obligations and the Subordinated Debt Loan, if any, has been pledged by AV
Metals as security for its guarantee of the Secured Obligations in a manner
satisfactory to the Administrative Agent, (vi) each other Guarantor, shall have
by a confirmation in form and substance reasonably satisfactory to the
Administrative Agent, confirmed that its guarantee of the Guaranteed Obligations
(including its Guarantee) shall apply to the Successor Canadian Borrower’s
obligations under this Agreement, (vii) Canadian Borrower and each other
Guarantor shall have by confirmations and any required supplements to the
applicable Security Documents reasonably requested by the Administrative Agent,
in each case, in form and substance reasonably satisfactory to the
Administrative Agent, confirmed that its obligations thereunder shall apply to
the Successor Canadian Borrower’s obligations under this Agreement and
(viii) each Loan Party shall have delivered opinions of counsel and related
officers’ certificates reasonably requested by the Administrative Agent with
respect to the execution and delivery and enforceability of the documents
referred to above and the compliance of such amalgamation with the provisions
hereof, and all such opinions of counsel shall be satisfactory to the
Administrative Agent; and provided, further, that (x) if the foregoing are
satisfied, (1) AV Metals will be substituted for and assume all obligations of
AV Aluminum under this Agreement and each of the other Loan Documents and
(2) the Successor Canadian Borrower shall be substituted for Novelis Inc. under
this Agreement and each of the other Loan Documents and all references hereunder
and under the other Loan Documents to Canadian Borrower shall be references to
the Successor Canadian Borrower and (y) notwithstanding any provision of
Section 11.02, the Agents are hereby authorized by the Lenders to make any
amendments to the Loan Documents that are necessary to reflect such changes in
the parties to the applicable Loan Documents.
     “Permitted Holdings Indebtedness” shall mean unsecured Indebtedness of
Holdings (i) with respect to which no Borrower or Subsidiary has any Contingent
Obligation, (ii) that will not mature prior to the 180th day following the Final
Maturity Date, (iii) that has no scheduled amortization of principal prior to
the 180th day following the Final Maturity Date, (iv) does not require any
payments in cash of interest or other amounts in respect of the principal
thereof (other than optional redemption provisions customary for senior discount
or “pay-in-kind” notes) for a number of years from the date of issuance or
incurrence thereof equal to at least one-half of the term to maturity thereof,
(v) has mandatory prepayment, repurchase or redemption, covenant, default and
remedy provisions customary for senior discount or “pay-in-kind” notes of an
issuer that is the parent of a borrower under senior secured asset based
revolving credit facilities and (vi) that is issued to a person that is not an
Affiliate of Canadian Borrower or any of its

     
 
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Subsidiaries in an arm’s-length transaction on fair market terms; provided that
at least five Business Days prior to the incurrence of such Indebtedness, a
Responsible Officer of Holdings shall have delivered a certificate to the
Administrative Agent (together with a reasonably detailed description of the
material terms and conditions of such Indebtedness or drafts of the
documentation relating thereto) stating that Holdings has determined in good
faith that such terms and conditions satisfy the foregoing requirements.
     “Permitted Liens” shall have the meaning assigned to such term in
Section 6.02.
     “Permitted Refinancing” shall mean, with respect to any person, any
refinancing or renewal of any Indebtedness of such person; provided that (a)
(i) in the case of any such refinancing or renewal of the Subordinated Debt
Loan, if the aggregate principal amount (or accreted value, if applicable) of
such refinancing or renewal exceeds the aggregate principal amount (or accreted
value, if applicable) of the Indebtedness so refinanced or renewed plus accrued
interest thereon and reasonable fees and expenses payable in connection with
such refinancing, the amount of any such excess is contributed by Holdings to
Canadian Borrower concurrently with such refinancing or renewal and (ii) in the
case of any refinancing or renewal of any other Indebtedness, the aggregate
principal amount (or accreted value, if applicable) thereof does not exceed the
aggregate principal amount (or accreted value, if applicable) of the
Indebtedness so refinanced or renewed except by an amount equal to unpaid
accrued interest and premium thereon and any make-whole payments applicable
thereto plus other reasonable amounts paid, and fees and expenses reasonably
incurred, in connection with such refinancing or renewal and by an amount equal
to any existing commitments unutilized thereunder, (b) such refinancing or
renewal has a final maturity date equal to or later than the final maturity date
of, and has a Weighted Average Life to Maturity equal to or greater than the
Weighted Average Life to Maturity of, the Indebtedness being refinanced or
renewed (excluding the effects of nominal amortization in the amount of no
greater than one percent per annum and prepayments of Indebtedness), (c) no
Default is then continuing or would result therefrom, (d) the persons that are
(or are required to be) obligors under such refinancing or renewal are the same
persons as those that are (or are required to be) obligors under the
Indebtedness being so refinanced or renewed (or, in the case of a Permitted
Refinancing of the Senior Notes, such obligors are Loan Parties (other than
Holdings)) and (e) the subordination provisions thereof (if any) shall be, in
the aggregate, no less favorable to the Lenders than those contained in the
Indebtedness being so refinanced or renewed; provided that at least five
Business Days prior to the incurrence of such refinancing or renewal, a
Responsible Officer of Administrative Borrower shall have delivered an Officers’
Certificate to the Administrative Agent (together with a reasonably detailed
description of the material terms and conditions of such Indebtedness or drafts
of the documentation relating thereto) certifying that Administrative Borrower
has determined in good faith that such terms and conditions satisfy the
foregoing requirements.
     “Permitted Revolving Credit Facility Refinancing” shall mean any
refinancing or renewal of the Indebtedness incurred under the Revolving Credit
Loan Documents; provided that (a) the aggregate principal amount (or accreted
value, if applicable) of all such Indebtedness, after giving effect to such
refinancing or renewal, shall not exceed the Maximum Revolving Credit Facility
Amount then in effect plus an amount equal to unpaid accrued interest and
premium on the Indebtedness being so refinanced or renewed plus other reasonable
amounts paid, and fees and expenses reasonably incurred, in connection with such
refinancing or renewal,

     
 
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(b) the “Applicable Margin” or similar component of the interest rate or yield
provisions applicable to such Indebtedness, after giving effect to such
refinancing or renewal, is not increased from the highest “Applicable Margin”
set forth in the Revolving Credit Loan Documents as of the Closing Date by more
than 3% per annum (excluding increases resulting from the accrual of interest at
the default rate specified in the Revolving Credit Agreement), (c) such
refinancing or renewal has a final maturity date equal to or later than the
final maturity date of the Indebtedness being so refinanced or renewed, (d) no
Default is existing or would result therefrom and (e) the persons that are (or
are required to be) obligors under such refinancing or renewal are the same
persons as those that are (or are required to be) obligors under the
Indebtedness being so refinanced or renewed (unless, in the case of a
refinancing of Indebtedness of a Loan Party, such persons are or become obligors
under the Loan Documents); provided that at least five Business Days prior to
the incurrence of such refinancing or renewal, a Responsible Officer of
Administrative Borrower shall have delivered an Officers’ Certificate to the
Administrative Agent (together with a reasonably detailed description of the
material terms and conditions of such Indebtedness or drafts of the
documentation relating thereto) certifying that Administrative Borrower has
determined in good faith that such terms and conditions satisfy the foregoing
requirements.
     “Permitted Uses” shall mean, as to any person, (a) investments in Cash
Equivalents, (b) the payment of Capital Lease Obligations of such person,
(c) Capital Expenditures of such person, (d) the payment of trade payables in
the ordinary course of its business, and (e) the payment of its Taxes and other
statutory obligations.
     “person” or “Person” shall mean any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
     “Plan” shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or
Section 412 of the Code or Section 302 of ERISA which is maintained or
contributed to by any Company or its ERISA Affiliate or with respect to which
any Company could incur liability (including under Section 4069 of ERISA).
     “Platform” shall have the meaning assigned to such term in
Section 11.01(d).
     “Pledged Intercompany Notes” shall mean, with respect to each Loan Party,
all intercompany notes described in Schedule 11 to the Perfection Certificate as
of the Closing Date and intercompany notes hereafter acquired by such Loan Party
and all certificates, instruments or agreements evidencing such intercompany
notes, and all assignments, amendments, restatements, supplements, extensions,
renewals, replacements or modifications thereof to the extent permitted pursuant
to the terms hereof.
     “Pledged Securities” shall mean, collectively, with respect to each Loan
Party, (i) all issued and outstanding Equity Interests of each issuer set forth
on Schedule 10 to the Perfection Certificate as of the Closing Date as being
owned by such Loan Party and all options, warrants, rights, agreements and
additional Equity Interests of whatever class of any such issuer acquired by
such Loan Party (including by issuance), together with all rights, privileges,
authority and powers of such Loan Party relating to such Equity Interests in
each such issuer or under any

     
 
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Organizational Document of each such issuer, and the certificates, instruments
and agreements representing such Equity Interests and any and all interest of
such Loan Party in the entries on the books of any financial intermediary
pertaining to such Equity Interests, (ii) all Equity Interests of any issuer,
which Equity Interests are hereafter acquired by such Loan Party (including by
issuance) and all options, warrants, rights, agreements and additional Equity
Interests of whatever class of any such issuer acquired by such Loan Party
(including by issuance), together with all rights, privileges, authority and
powers of such Loan Party relating to such Equity Interests or under any
Organizational Document of any such issuer, and the certificates, instruments
and agreements representing such Equity Interests and any and all interest of
such Loan Party in the entries on the books of any financial intermediary
pertaining to such Equity Interests, from time to time acquired by such Loan
Party in any manner, and (iii) all Equity Interests issued in respect of the
Equity Interests referred to in clause (i) or (ii) upon any consolidation or
merger of any issuer of such Equity Interests.
     “Post-Increase Lenders” shall have the meaning assigned to such term in
Section 2.23(d).
     “PPSA” shall mean the Personal Property Security Act (Ontario) and the
regulations promulgated thereunder and other applicable personal property
security legislation of the applicable Canadian province or provinces in respect
of the Canadian Loan Parties (including the Civil Code of Quebec and the
regulations respecting the register of personal and movable real rights
promulgated thereunder) as all such legislation now exists or may from time to
time hereafter be amended, modified, recodified, supplemented or replaced,
together with all rules, regulations and interpretations thereunder or related
thereto.
     “Pre-Increase Lenders” shall have the meaning assigned to such term in
Section 2.23(d).
     “Preferred Stock” shall mean, with respect to any person, any and all
preferred or preference Equity Interests (however designated) of such person
whether now outstanding or issued after the Closing Date.
     “Preferred Stock Issuance” shall mean the issuance or sale by Holdings or
any of its Subsidiaries of any Preferred Stock after the Closing Date.
     “Prepayment Offer Amounts” shall have the meaning assigned to such term in
Section 2.10(i)(ii).
     “Prepayment Offer Notice” shall have the meaning assigned to such term in
Section 2.10(i)(ii).
     “Principal Jurisdiction” shall mean the United States, Canada, the United
Kingdom, Switzerland, Germany and any state, province or other political
subdivision of the foregoing.
     “Pro Forma Basis” shall mean on a basis in accordance with GAAP and
Regulation S-X and otherwise reasonably satisfactory to the Administrative
Agent.

     
 
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     “Pro Rata Percentage” of any Lender at any time shall mean the percentage
of the sum of the total outstanding Loans and unused Commitments of all Lenders
represented by such Lender’s outstanding Loans and unused Commitments.
     “Process Agent” shall have the meaning assigned to such term in
Section 11.09(d).
     “property” shall mean any right, title or interest in or to property or
assets of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible and including Equity Interests or other ownership
interests of any person and whether now in existence or owned or hereafter
entered into or acquired, including all Real Property.
     “Property Material Adverse Effect” shall mean, with respect to any
Mortgaged Property, as of any date of determination and whether individually or
in the aggregate, any event, circumstance, occurrence or condition which has
caused or resulted in (or would reasonably be expected to cause or result in) a
material adverse effect on (a) the business or operations of any Company as
presently conducted at the Mortgaged Property; (b) the value or utility of the
Mortgaged Property; or (c) the legality, priority or enforceability of the Lien
created by the Mortgage or the rights and remedies of the Mortgagee thereunder.
     “PTR Scheme” shall mean the Provisional Treaty Relief scheme as described
in the HM Revenue & Customs (formerly the Inland Revenue Guidelines dated
January 2003 and administered by HM Revenue & Customs’ Centre for Non-Residents.
     “Purchase Money Obligation” shall mean, for any person, the obligations of
such person in respect of Indebtedness (including Capital Lease Obligations)
incurred for the purpose of financing all or any part of the purchase price of
any property (including Equity Interests of any person) or the cost of
installation, construction or improvement of any property and any refinancing
thereof; provided, however, that (i) such Indebtedness is incurred within one
year after such acquisition, installation, construction or improvement of such
property by such person and (ii) the amount of such Indebtedness does not exceed
100% of the cost of such acquisition, installation, construction or improvement,
as the case may be.
     “Qualified Capital Stock” of any person shall mean any Equity Interests of
such person that are not Disqualified Capital Stock.
     “Real Property” shall mean, collectively, all right, title and interest
(including any freehold, leasehold, mineral or other estate) in and to any and
all parcels of or interests in real property owned, leased or operated by any
person, whether by lease, license or other means, together with, in each case,
all easements, hereditaments and appurtenances relating thereto, all
improvements and appurtenant fixtures, all general intangibles and contract
rights and other property and rights incidental to the ownership, lease or
operation thereof.
     “Receivable” shall mean the indebtedness and other obligations owed to any
Company (other than any Loan Party or any Company organized under the laws of
Germany) (at the time such indebtedness and other obligations arise, and before
giving effect to any transfer or conveyance contemplated under any
Securitization Facility documentation) or in which such person has a security
interest or other interest, including any indebtedness, obligation or interest
constituting an Account, contract right, payment intangible, promissory note,
chattel paper,

     
 
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instrument, document, investment property, financial asset or general
intangible, arising in connection with the sale of goods or the rendering of
services by such person, and further includes, the obligation to pay any finance
charges with respect thereto.
     “Receivables Purchase Agreement” shall mean the receivables purchase
agreement and any related servicing agreements between the German Seller, on the
one hand, and Novelis AG, on the other hand, in substantially the form of
Exhibit R or otherwise in form and substance reasonably satisfactory to the
Administrative Agent, in each case providing, inter alia, for the sale and
transfer of Accounts by the German Seller to Novelis AG, as each such agreement
may be amended, modified, supplemented or replaced from time to time in
accordance with the terms thereof.
     “Receiver” shall mean a receiver or receiver and manager or, where
permitted by law, an administrative receiver of the whole or any part of the
Collateral, and that term will include any appointee under a joint and/or
several appointments.
     “Refinancing” shall mean the repayment in full and the termination of any
commitment to make extensions of credit under all of the outstanding
indebtedness listed on Schedule 1.01(a) of Canadian Borrower or any of its
Subsidiaries.
     “Register” shall have the meaning assigned to such term in
Section 11.04(c).
     “Regulation” shall have the meaning assigned to such term in Section 3.27.
     “Regulation D” shall mean Regulation D of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
     “Regulation S-X” shall mean Regulation S-X promulgated under the Securities
Act.
     “Regulation T” shall mean Regulation T of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
     “Regulation U” shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
     “Regulation X” shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.
     “Related Business Assets” shall mean assets (other than cash or Cash
Equivalents) used or useful in a Similar Business; provided that any assets
received by any Loan Party in exchange for assets transferred by a Loan Party
shall not be deemed to be Related Business Assets if they consist of securities
of a person, unless upon receipt of the securities of such person, such person
would become a Loan Party.
     “Related Parties” shall mean, with respect to any person, such person’s
Affiliates and the partners, directors, officers, employees, agents and advisors
of such person and of such person’s Affiliates.

     
 
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     “Related Security” shall mean, with respect to any Receivable, all of the
applicable Securitization Subsidiary’s interest in the inventory and goods
(including returned or repossessed inventory or goods), if any, the sale of
which by the applicable Company gave rise to such Receivable, and all insurance
contracts with respect thereto, all other security interests or liens and
property subject thereto from time to time, if any, purporting to secure payment
of such Receivable, whether pursuant to the contract related to such Receivable
or otherwise, together with all financing statements and security agreements
describing any collateral securing such Receivable, all guaranties, letters of
credit, letter-of-credit rights, supporting obligations, insurance and other
agreements or arrangements of whatever character from time to time supporting or
securing payment of such Receivable whether pursuant to the contract related to
such Receivable or otherwise, all service contracts and other contracts and
agreements associated with such Receivable, all records related to such
Receivable, and all of the applicable Securitization Subsidiaries’ right, title
and interest in, to and under the applicable Securitization Facility
documentation.
     “Release” shall mean any spilling, leaking, seepage, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping,
disposing, depositing, dispersing, emanating or migrating of any Hazardous
Material in, into, onto or through the Environment.
     “Required Class Lenders” shall mean, with respect to any Class of Loans,
Lenders having more than 50% of the sum of all Loans and unused Commitments (if
any) of such Class outstanding.
     “Required Lenders” shall mean Lenders having more than 50% of the sum of
all Loans outstanding and unused Commitments (if any).
     “Requirements of Law” shall mean, collectively, any and all legally binding
requirements of any Governmental Authority including any and all laws,
judgments, orders, decrees, ordinances, rules, regulations, statutes or case
law.
     “Response” shall mean (a) “response” as such term is defined in CERCLA, 42
U.S.C. § 9601(24), and (b) all other actions required by any Governmental
Authority or voluntarily undertaken to (i) clean up, remove, treat, abate or in
any other way address any Hazardous Material in the Environment; (ii) prevent
the Release or threat of Release, or minimize the further Release, of any
Hazardous Material; or (iii) perform studies and investigations in connection
with, or as a precondition to, or to determine the necessity of the activities
described in, clause (i) or (ii) above.
     “Responsible Officer” shall mean, with respect to any Person, any of the
principal executive officers, managing members or general partners of such
Person but, in any event, with respect to financial matters, the chief financial
officer, treasurer or controller of such person.
     “Restricted Grantor” shall mean a Loan Party that has granted a Guarantee
that is subject to limitations that impair in any material respect the benefit
of such Guarantee (as determined by the Administrative Agent in its reasonable
discretion) (it being expressly understood and agreed that (i) no Loan Party
that is Canadian Borrower, a Canadian Guarantor, a U.K. Guarantor, U.S. Borrower
or a U.S. Guarantor shall be a Restricted Grantor and (ii) except

     
 
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as may be otherwise determined by the Administrative Agent in its reasonable
discretion, each Loan Party that is a German Guarantor, an Irish Guarantor, a
Swiss Guarantor or a Brazilian Guarantor shall be a Restricted Grantor).
     “Revolving Credit Agents” shall mean the “Agents” (as defined in the
Revolving Credit Loan Documents, including the Revolving Credit Funding Agent,
the Revolving Credit Canadian Administrative Agent and the Revolving Credit
Collateral Agent).
     “Revolving Credit Agreement” shall mean (i) that certain credit agreement
dated as of the date hereof among the Loan Parties, the Revolving Credit
Lenders, ABN AMRO Bank N.V., as U.S./European issuing bank, as U.S. swingline
lender, and as administrative agent, the Revolving Credit Canadian
Administrative Agent, ABN AMRO Bank N.V., acting through its Canadian branch, as
Canadian issuing bank and as Canadian funding agent, the Revolving Credit
Collateral Agent, the Revolving Credit Funding Agent, UBS Securities LLC, as
syndication agent, Bank of America, N.A., National City Business Credit, Inc.
and CIT Business Credit Canada Inc., as documentation agents, and ABN AMRO
Incorporated and UBS Securities LLC, as joint lead arrangers and joint
bookmanagers, as amended, restated, supplemented or modified from time to time
to the extent permitted by this Agreement and the Intercreditor Agreement and
(ii) any other credit agreement, loan agreement, note agreement, promissory
note, indenture or other agreement or instrument evidencing or governing the
terms of any indebtedness or other financial accommodation that has been
incurred to extend (subject to the limitations set forth herein and in the
Intercreditor Agreement) or refinance in whole or in part the indebtedness and
other obligations outstanding under the (x) credit agreement referred to in
clause (i) or (y) any subsequent Revolving Credit Agreement, in each case which
constitutes a Permitted Revolving Credit Facility Refinancing with respect to
the Revolving Credit Loans, unless such agreement or instrument expressly
provides that it is not intended to be and is not a Revolving Credit Agreement
hereunder. Any reference to the Revolving Credit Agreement hereunder shall be
deemed a reference to any Revolving Credit Agreement then in existence.
     “Revolving Credit Canadian Administrative Agent” shall mean ABN AMRO Bank
N.V., acting through its Canadian branch, in its capacity as Canadian
administrative agent under the Revolving Credit Agreement, and its successors
and assigns in such capacity.
     “Revolving Credit Canadian Funding Agent” shall mean ABN AMRO Bank N.V.,
acting through its Canadian branch, in its capacity as Canadian funding agent
under the Revolving Credit Agreement, and its successors and assigns in such
capacity.
     “Revolving Credit Collateral Agent” shall mean LaSalle Business Credit,
LLC, in its capacity as collateral agent under the Revolving Credit Agreement,
and its successors and assigns in such capacity.
     “Revolving Credit Commitments” shall mean the commitments of the Revolving
Credit Lenders to make Revolving Credit Loans under the Revolving Credit
Agreement.
     “Revolving Credit Funding Agent” shall mean LaSalle Business Credit, LLC,
in its capacity as funding agent under the Revolving Credit Agreement, and its
successors and assigns in such capacity.

     
 
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     “Revolving Credit Lenders” shall mean the banks, financial institutions and
other entities from time to time party to the Revolving Credit Agreement as
lenders.
     “Revolving Credit Loan Documents” shall mean the Revolving Credit Agreement
and the other “Loan Documents” as defined in the Revolving Credit Agreement,
including the mortgages and other security documents, guaranties and the notes
issued thereunder.
     “Revolving Credit Loans” shall mean the revolving loans and swingline loans
outstanding under the Revolving Credit Agreement.
     “Revolving Credit Maturity Date” shall have meaning assigned to the term
“Final Maturity Date” in the Revolving Credit Agreement (and any corresponding
term in any successor Revolving Credit Agreement permitted hereby).
     “Revolving Credit Obligations” shall mean the Revolving Credit Loans and
the guarantees by the Loan Parties under the Revolving Credit Loan Documents.
     “Revolving Credit Priority Collateral” shall mean all “Revolving Credit
Priority Collateral” as defined in the Intercreditor Agreement.
     “Revolving Credit Secured Parties” shall mean the Revolving Credit Funding
Agent, the Revolving Credit Canadian Administrative Agent, the Revolving Credit
Collateral Agent and each other Person that is a “Secured Party” under the
Revolving Credit Agreement.
     “Revolving Credit Security Documents” shall have the meaning assigned to
the term “Security Documents” in the Revolving Credit Agreement (and any
corresponding term in any successor Revolving Credit Agreement permitted
hereby).
     “S&P” shall mean Standard & Poor’s Rating Services.
     “Sale and Leaseback Transaction” shall have the meaning assigned to such
term in Section 6.03.
     “Sarbanes-Oxley Act” shall mean the United States Sarbanes-Oxley Act of
2002, as amended, and all rules and regulations promulgated thereunder.
     “Section 347” shall have the meaning assigned to such term in
Section 2.19(a).
     “Secured Debt Agreement” shall mean (i) this Agreement and (ii) the other
Loan Documents.
     “Secured Obligations” shall mean (a) the Obligations and (b) the due and
punctual payment and performance of all obligations of the Borrowers and the
other Loan Parties under each Hedging Agreement entered into with any
counterparty that is a Secured Party.
     “Secured Parties” shall mean, collectively, the Administrative Agent, the
Collateral Agent, the Administrative Agent, any Receiver or Delegate, each other
Agent, the Lenders and each counterparty to a Hedging Agreement with a Loan
Party, if at the date of entering into such

     
 
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Hedging Agreement (or, with respect to Hedging Agreements in effect at the date
hereof, at the date hereof) such person was a Lender, Revolving Credit Lender,
Arranger or Agent (or an Affiliate of a Lender, Revolving Credit Lender,
Arranger or Agent), and in each case, such person executes and delivers to the
Administrative Agent a letter agreement substantially in the form of Exhibit Q
attached hereto or in such other form as may be acceptable to the Administrative
Agent pursuant to which such person (i) appoints the Collateral Agent as its
agent under the applicable Loan Documents and (ii) agrees to be bound by the
provisions of Section 10.03, Section 10.09, the Intercreditor Agreement and the
Security Documents as if it were a Lender.
     “Securities Act” shall mean the Securities Act of 1933.
     “Securities Collateral” shall mean, collectively, the Pledged Securities,
the Pledged Intercompany Notes and the Distributions.
     “Securitization Assets” means all existing or hereafter acquired or arising
(i) Receivables that are sold, assigned or otherwise transferred pursuant to a
Securitization Facility, (ii) the Related Security with respect to the
Receivables referred to in clause (i) above, (iii) the collections and proceeds
of the Receivables and Related Security referred to in clauses (i) and
(ii) above, (iv) all lockboxes, lockbox accounts, collection accounts or other
deposit accounts into which such collections are deposited (and in any event
excluding any lockboxes, lockbox accounts, collection accounts or deposit
accounts that any Loan Party or any Company organized under the laws of Germany
has an interest in) and which have been specifically identified and consented to
by the Administrative Agent, and (v) all other rights and payments which relate
solely to such Receivables.
     “Securitization Facility” means each transaction or series of related
transactions that effect the securitization of Receivables of a person; provided
that no Receivables or other property of any Borrower or any Company organized
or conducting business in a Principal Jurisdiction shall be subject to a
Securitization Facility.
     “Securitization Subsidiary” means any special purpose financial subsidiary
established by a Company for the sole purpose of consummating one or more
Securitization Facilities and in respect of which no Company (other than a
Securitization Subsidiary) has any obligation to maintain or preserve such
Securitization Subsidiary’s financial condition or cause such Securitization
Subsidiary to achieve specified levels of operating results.
     “Security Agreement” shall mean each U.S. Security Agreement, each Canadian
Security Agreement, each U.K. Security Agreement, each Swiss Security Agreement,
each German Security Agreement, each Irish Security Agreement, each Brazilian
Security Agreement, and each other Security Agreement entered into pursuant to
Section 5.11(b), individually and collectively, as the context may require.
     “Security Agreement Collateral” shall mean all property pledged or granted
as collateral pursuant to any Security Agreement (a) on the Closing Date or
(b) thereafter pursuant to Section 5.11.

     
 
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     “Security Documents” shall mean each Security Agreement, the Mortgages, any
Security Trust Deed, and each other security document, deed of trust, charge or
pledge agreement delivered in accordance with applicable local or foreign law to
grant a valid, perfected security interest in any property as collateral for the
Secured Obligations, and all UCC or other financing statements or financing
change statements, control agreements, bailee notification letters, or
instruments of perfection required by this Agreement, any Security Agreement,
any Mortgage or any other such security document, charge or pledge agreement to
be filed with respect to the security interests in property and fixtures created
pursuant to any Security Agreement or any Mortgage and any other document or
instrument utilized to pledge or grant or purport to pledge or grant a security
interest or lien on any property as collateral for the Secured Obligations or to
perfect, obtain control over or otherwise protect the interest of the Collateral
Agent therein.
     “Security Trust Deed” shall mean any security trust deed to be executed by,
among others, the Collateral Agent, the Administrative Agent and any Loan Party
granting security over U.K. or Irish assets of any Loan Party.
     “Senior Note Agreement” shall mean the indenture dated as of February 3,
2005, pursuant to which the Senior Notes were issued and any other indenture,
note purchase agreement or other agreement pursuant to which Senior Notes are
issued in a Permitted Refinancing of the Senior Notes.
     “Senior Note Documents” shall mean the Senior Notes, the Senior Note
Agreement, the Senior Note Guarantees and all other documents executed and
delivered with respect to the Senior Notes or the Senior Note Agreement.
     “Senior Note Guarantees” shall mean the guarantees of the Loan Parties
(other than Holdings) and the other guarantors pursuant to the Senior Note
Agreement.
     “Senior Notes” shall mean Canadian Borrower’s 7-1/4% Senior Notes due 2015
issued pursuant to the Senior Note Agreement and any senior notes issued
pursuant to a Permitted Refinancing of the Senior Notes (including the
registered notes issued in exchange for Senior Notes with substantially
identical terms as the Senior Notes so exchanged).
     “Senior Secured Leverage Ratio” shall mean, at any date of determination,
the ratio of Consolidated Senior Secured Indebtedness on such date to
Consolidated Adjusted EBITDA for the four consecutive fiscal quarters of
Canadian Borrower then last ended (in each case taken as one accounting period)
for which financial statements have been delivered (or if financial statements
with respect to the most recently ended fiscal quarter are required to but, have
not been delivered, for which financial statements are then required to have
been delivered).
     “Significant Event of Default” shall mean any Event of Default under
Section 8.01(a), (b), (g) or (h).
     “Similar Business” shall mean any business conducted by Canadian Borrower
and the other Loan Parties on the Closing Date as described in the Confidential
Information Memorandum (or, in the good faith judgment of the Board of
Directors, which are substantially related thereto or are reasonable extensions
thereof).

     
 
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     “Specified Holders” shall mean the Persons listed on Schedule 1.01(e).
     “Spot Selling Rate” shall mean, on any date of determination, the spot
selling rate determined by the Administrative Agent which shall be the spot
selling rate posted by Reuters on its website for the sale of the applicable
currency for Dollars at approximately 5:00 p.m. (New York City time) on the
prior Business Day; provided that if such rate is not available, such rate shall
be the spot selling rate posted by the Federal Reserve Bank of New York on its
website for the sale of the applicable currency for Dollars at approximately
5:00 p.m. (New York City time) on the prior Business Day.
     “Statutory Reserves” shall mean, for any Interest Period for any
Eurocurrency Borrowing in dollars, the average maximum rate at which reserves
(including any marginal, supplemental or emergency reserves) are required to be
maintained during such Interest Period under Regulation D by member banks of the
United States Federal Reserve System in New York City with deposits exceeding
one billion dollars against “Eurocurrency liabilities” (as such term is used in
Regulation D). Eurocurrency Borrowings shall be deemed to constitute
Eurocurrency liabilities and to be subject to such reserve requirements without
benefit of or credit for proration, exceptions or offsets which may be available
from time to time to any Lender under Regulation D.
     “Subordinated Debt Loan” shall mean that certain loan extended by AV Metals
to Holdings in the aggregate principal amount of $900,000,000, as evidenced by
the Promissory Note, dated May 15, 2007, made by Holdings in favor of AV Metals,
as such loan may be increased by any Additional Subordinated Debt Loan or
amended, in each case, in accordance with the terms hereof; provided that to the
extent the provisions of the definition of Permitted Holdings Amalgamation are
complied with, the Subordinated Debt Loan in effect on the Closing Date and any
Additional Subordinated Debt Loan incurred after the Closing Date and prior to
the date of the Permitted Holdings Amalgamation may become an obligation of the
Canadian Borrower after the Permitted Holdings Amalgamation occurs; and
provided, further, that all other Subordinated Debt Loans, if any, shall at all
times be and remain unsecured obligations solely of Holdings.
     “Subordinated Indebtedness” shall mean Indebtedness of a Loan Party that is
subordinated by its terms (including pursuant to the terms of any subordination
agreement, intercreditor agreement, or otherwise) in right of payment to the
Obligations of such Loan Party, including the Subordinated Debt Loan.
     “Subsidiary” shall mean, with respect to any person (the “parent”) at any
date, (i) any person the accounts of which would be consolidated with those of
the parent in the parent’s consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, (ii) any other
corporation, limited liability company, association or other business entity of
which securities or other ownership interests representing more than 50% of the
voting power of all Equity Interests entitled (without regard to the occurrence
of any contingency) to vote in the election of the Board of Directors thereof
are, as of such date, owned, controlled or held by the parent and/or one or more
subsidiaries of the parent, (iii) any partnership (a) the sole general partner
or the managing general partner of which is the parent and/or one or more
subsidiaries of the parent or (b) the only general partners of which are the

     
 
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parent and/or one or more subsidiaries of the parent and (iv) any other person
that is otherwise Controlled by the parent and/or one or more subsidiaries of
the parent. Unless the context requires otherwise, “Subsidiary” refers to a
Subsidiary of Holdings. Notwithstanding the foregoing, Logan shall not be
treated as a Subsidiary hereunder or under the other Loan Documents unless it
qualifies as a Subsidiary under clause (ii) of this definition.
     “Subsidiary Guarantor” shall mean each Subsidiary listed on
Schedule 1.01(b), and each other Subsidiary that is or becomes a party to this
Agreement as a Subsidiary Guarantor pursuant to Section 5.11.
     “Survey” shall mean a survey of any Mortgaged Property (and all
improvements thereon) which is (a) (i) prepared by a surveyor or engineer
licensed to perform surveys in the jurisdiction where such Mortgaged Property is
located, (ii) current as of a date which shows all exterior construction on the
site of such Mortgaged Property or any easement, right of way or other interest
in the Mortgaged Property has been granted or become effective through operation
of law or otherwise with respect to such Mortgaged Property which, in either
case, can be depicted on a survey, unless otherwise acceptable to the Collateral
Agent, (iii) certified by the surveyor (in a manner reasonably acceptable to the
Administrative Agent) to the Administrative Agent, the Collateral Agent and the
Title Company, (iv) complying in all respects with the minimum detail
requirements of the American Land Title Association (or the local equivalent) as
such requirements are in effect on the date of preparation of such survey and
(v) sufficient for the Title Company to remove all standard survey exceptions
from the title insurance policy (or commitment) relating to such Mortgaged
Property and issue the endorsements of the type required by Section 4.01(o)(iii)
or (b) otherwise acceptable to the Collateral Agent.
     “Swiss Guarantor” shall mean each Subsidiary of Holdings organized in
Switzerland party hereto as a Guarantor, and each other Subsidiary of Holdings
organized in Switzerland that is required to become a Guarantor pursuant to the
terms hereof.
     “Swiss Security Agreement” shall mean, collectively, any Security Agreement
substantially in the form of Exhibits M-4-1 to 7 among the Swiss Guarantors and
the Collateral Agent for the benefit of the Secured Parties.
     “Swiss Withholding Tax” shall mean any withholding tax in accordance with
the Swiss Federal Statute on Anticipatory Tax of 13 October 1965 (Bundesgesetz
uber die Verrechnungssteuer) and any successor provision, as appropriate.
     “Syndication Agent” shall have the meaning assigned to such term in the
preamble hereto.
     “Tax Return” shall mean all returns, statements, filings, attachments and
other documents or certifications required to be filed in respect of Taxes.
     “Taxes” shall mean all present or future taxes, levies, imposts, duties,
deductions, withholdings, payroll, social security, employment and unemployment
taxes, assessments, fees or other charges imposed by any Taxing Authority,
including any interest, additions to tax or penalties applicable thereto.

     
 
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     “Taxing Authority” shall mean any governmental entity of any jurisdiction
or political subdivision thereof with the authority to impose, assess, and
collect Taxes and engage in activities of a similar nature with respect to such
Taxing Authority.
     “Term Loans” shall have the meaning assigned to such term in
Section 2.01(b).
     “Term Loan Commitments” shall mean the Canadian Term Loan Commitments and
the U.S. Term Loan Commitments, collectively.
     “Term Loan Priority Collateral” shall mean all “Term Loan Priority
Collateral” as defined in the Intercreditor Agreement.
     “Term Loan Repayment Date” shall have the meaning assigned to such term in
Section 2.09.
     “Test Period” shall mean, at any time, the four consecutive fiscal quarters
of Canadian Borrower then last ended (in each case taken as one accounting
period).
     “Title Company” shall mean any title insurance company as shall be retained
by Borrower and reasonably acceptable to the Administrative Agent.
     “Title Policy” shall have the meaning assigned to such term in
Section 4.01(o)(iii).
     “Transaction Documents” shall mean the Loan Documents (other than Hedging
Agreements) and the Revolving Credit Loan Documents.
     “Transactions” shall mean, collectively, the transactions to occur on or
prior to the Closing Date pursuant to the Transaction Documents, including
(a) the execution, delivery and performance of the Loan Documents and the
initial borrowings hereunder; (b) the Refinancing; (c) the execution, delivery
and performance of the Revolving Credit Loan Documents and the borrowings
thereunder; and (d) the payment of all fees and expenses to be paid on or prior
to the Closing Date and owing in connection with the foregoing.
     “Transferred Guarantor” shall have the meaning assigned to such term in
Section 7.09.
     “Type,” when used in reference to any Loan or Borrowing, refers to whether
the rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBOR Rate or the Alternate Base Rate.
     “UCC” shall mean the Uniform Commercial Code as in effect from time to time
(except as otherwise specified) in any applicable state or jurisdiction.
     “U.K. Guarantor” shall mean each Subsidiary of Holdings incorporated in
England and Wales party hereto as a Guarantor, and each other Subsidiary of
Holdings incorporated in England and Wales that is required to become a
Guarantor pursuant to the terms hereof.

     
 
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     “U.K. Security Agreement” shall mean, collectively, any Security Agreement
substantially in the form of Exhibits M-3-1 to 3 among the U.K. Guarantors and
the Collateral Agent for the benefit of the Secured Parties, including the U.K.
Share Charge.
     “U.K. Share Charge” shall mean shall mean a Security Agreement in
substantially the form of Exhibit M-3-2, among Canadian Borrower and the
Collateral Agent.
     “United States” shall mean the United States of America.
     “Unrestricted Grantors” shall mean Loan Parties that are not Restricted
Grantors.
     “U.S. Borrower” shall have the meaning assigned to such term in the
preamble hereto.
     “U.S. Guarantor” shall mean each Subsidiary of Holdings organized in the
United States, any state thereof or the District of Columbia, party hereto as a
Guarantor, and each other Subsidiary of Holdings organized in the United States,
any state thereof or the District of Columbia that is required to become a
Guarantor pursuant to the terms hereof.
     “U.S. Loan Parties” shall mean the U.S. Borrower and the U.S. Guarantors.
     “U.S. Security Agreement” shall mean a Security Agreement substantially in
the form of Exhibit M-1 among Canadian Borrower, the U.S. Loan Parties and the
Collateral Agent for the benefit of the Secured Parties.
     “U.S. Term Loan” shall have the meaning assigned to such term in
Section 2.01(a).
     “U.S. Term Loan Commitment” shall mean shall mean, with respect to each
Lender, the commitment, if any, of such Lender to make U.S. Term Loans hereunder
up to the amount set forth on Schedule I to the Lender Addendum executed and
delivered by such Lender directly under the column entitled “U.S. Term Loan
Commitment” or in an Increase Joinder. The aggregate amount of the Lenders’ U.S.
Term Loan Commitments on the Closing Date is $660 million.
     “Voting Stock” shall mean, with respect to any person, any class or classes
of Equity Interests pursuant to which the holders thereof have the general
voting power under ordinary circumstances to elect at least a majority of the
Board of Directors of such person.
     “Weighted Average Life to Maturity” shall mean, when applied to any
Indebtedness at any date, the number of years obtained by dividing: (a) the sum
of the products obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment; by (b) the then outstanding principal
amount of such Indebtedness.
     “Wholly Owned Subsidiary” shall mean, as to any person, (a) any corporation
100% of whose capital stock (other than directors’ qualifying shares) is at the
time owned by such person and/or one or more Wholly Owned Subsidiaries of such
person and (b) any partnership,

     
 
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association, joint venture, limited liability company or other entity in which
such person and/or one or more Wholly Owned Subsidiaries of such person have a
100% equity interest at such time.
     “Wind-Up” shall have the meaning assigned to such term in Section 6.05(g),
and the term “Winding-Up” shall have a meaning correlative thereto.
     “Withdrawal Liability” shall mean liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
     “525 Amortization Amount” shall have the meaning assigned to such term in
Section 2.09(b).
     “525 Catch-Up Date” shall mean, with respect to any Loan, the date that is
five (5) years plus a day following the date of borrowing thereof.
     “525 Collateral Account” shall have the meaning assigned to such term in
Section 2.09(b).
     “525 Prepayment Amount” shall have the meaning assigned to such term in
Section 2.10(h)(vi).
SECTION 1.02 Classification of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified and referred to by Class (e.g., a “U.S. Term
Loan” or a “Canadian Term Loan”) or by Type (e.g., a “Eurocurrency Loan”) or by
Class and Type (e.g., a “Eurocurrency U.S. Term Loan” or “Eurocurrency Canadian
Term Loan”). Borrowings also may be classified and referred to by Class (e.g., a
“U.S. Term Loan Borrowing”) or by Type (e.g., a “Eurocurrency Borrowing”) or by
Class and Type (e.g., a “Eurocurrency U.S. Term Loan Borrowing”).
SECTION 1.03 Terms Generally; Currency Translation. The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include,”
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation.” The word “will” shall be construed to have the same meaning and
effect as the word “shall.” Unless the context requires otherwise (a) any
definition of or reference to any Loan Document, agreement, instrument or other
document herein shall be construed as referring to such agreement, instrument or
other document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any person shall be construed to
include such person’s successors and assigns, (c) the words “herein,” “hereof”
and “hereunder,” and words of similar import, shall be construed to refer to
this Agreement in its entirety and not to any particular provision hereof,
(d) all references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement, (e) any reference to any law or regulation herein shall refer to
such law or regulation as amended, modified or supplemented from time to time,
(f) the words “asset” and “property” shall be construed to have the same meaning
and effect and to refer to any and all

     
 
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tangible and intangible assets and properties, including cash, securities,
accounts and contract rights and (g) “on,” when used with respect to the
Mortgaged Property or any property adjacent to the Mortgaged Property, means
“on, in, under, above or about.” For purposes of this Agreement and the other
Loan Documents, where the permissibility of a transaction or determinations of
required actions or circumstances depend upon compliance with, or are determined
by reference to, amounts stated in dollars, such amounts shall be deemed to
refer to Dollars or Dollar Equivalents and any requisite currency translation
shall be based on the Spot Selling Rate in effect on the Business Day
immediately preceding the date of such transaction or determination and the
permissibility of actions taken under Article VI shall not be affected by
subsequent fluctuations in exchange rates (provided that if Indebtedness is
incurred to refinance other Indebtedness, and such refinancing would cause the
applicable dollar denominated limitation to be exceeded if calculated at the
Spot Selling Rate in effect on the Business Day immediately preceding the date
of such refinancing, such dollar denominated restriction shall be deemed not to
have been exceeded so long as (x) such refinancing Indebtedness is denominated
in the same currency as such Indebtedness being refinanced and (y) the principal
amount of such refinancing Indebtedness does not exceed the principal amount of
such Indebtedness being refinanced except as permitted by the definition of
Permitted Refinancing Indebtedness). For purposes of this Agreement and the
other Loan Documents, the word “foreign” shall refer to jurisdictions other than
the United States, the states thereof and the District of Columbia. From and
after the effectiveness of the Permitted Holdings Amalgamation (x) all
references to Canadian Borrower in any Loan Document shall refer to the
Successor Canadian Borrower and (y) all references to Holdings or Parent
Guarantor in any Loan Document shall refer to AV Metals.
SECTION 1.04 Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all financial statements to be delivered pursuant to this Agreement
shall be prepared in accordance with GAAP as in effect from time to time and all
terms of an accounting or financial nature shall be construed and interpreted in
accordance with GAAP, as in effect from time to time unless otherwise agreed to
by Administrative Borrower and the Required Lenders; provided that (i) if at any
time any change in GAAP would affect the computation of any financial ratio or
requirement set forth in any Loan Document, and either Administrative Borrower
or the Required Lenders shall so request, the Administrative Agent, the Lenders
and Administrative Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Required Lenders); provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) Administrative
Borrower shall provide to the Administrative Agent and the Lenders any documents
required under this Agreement or as reasonably requested hereunder setting forth
a reconciliation between calculations of such ratio or requirement made before
and after giving effect to such change in GAAP.
SECTION 1.05 Resolution of Drafting Ambiguities. Each Loan Party acknowledges
and agrees that it was represented by counsel in connection with the execution
and delivery of the Loan Documents to which it is a party, that it and its
counsel reviewed and participated in the preparation and negotiation hereof and
thereof and that any rule of construction to the effect that ambiguities are to
be resolved against the drafting party shall not be employed in the
interpretation hereof or thereof.

     
 
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ARTICLE II.
THE CREDITS
SECTION 2.01 Commitments.
     (a) Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender with a U.S. Term
Loan Commitment agrees, severally and not jointly, to make a Term Loan in
Dollars to the U.S. Borrower (each, a “U.S. Term Loan”) on the Closing Date in
the principal amount not to exceed its U.S. Term Loan Commitment.
     (b) Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender with a Canadian
Term Loan Commitment agrees, severally and not jointly, to make a Term Loan in
Dollars to Canadian Borrower (each, a “Canadian Term Loan” and, together with
the U.S. Term Loans, the “Term Loans” and each being called a “Term Loan”) on
the Closing Date in the principal amount not to exceed its Canadian Term Loan
Commitment.
     (c) Amounts paid or prepaid in respect of Term Loans may not be reborrowed.
SECTION 2.02 Loans.
     (a) Each Loan shall be made as part of a Borrowing consisting of Loans made
by the Lenders ratably in accordance with their applicable Commitments; provided
that the failure of any Lender to make its Loan shall not in itself relieve any
other Lender of its obligation to lend hereunder (it being understood, however,
that no Lender shall be responsible for the failure of any other Lender to make
any Loan required to be made by such other Lender). Each Borrowing shall be in
an aggregate principal amount that is not less than (and in integral amounts
consistent with) the Minimum Amount.
     (b) Subject to Section 2.11 and Section 2.12, each Borrowing shall be
comprised entirely of ABR Loans or Eurocurrency Loans as Administrative Borrower
may request pursuant to Section 2.03; provided that all Loans comprising the
same Borrowing shall at all times be of the same Type. Each Lender may at its
option make any Eurocurrency Loan by causing any domestic or foreign branch or
Affiliate of such Lender to make such Loan; provided that any exercise of such
option shall not affect the obligation of the applicable Borrower to repay such
Loan in accordance with the terms of this Agreement. Borrowings of more than one
Type may be outstanding at the same time; provided that Borrower shall not be
entitled to request any Borrowing that, if made, would result in more than eight
(8) Eurocurrency Borrowings of U.S. Term Loans or more than four
(4) Eurocurrency Borrowings of Canadian Term Loans outstanding hereunder at any
one time. For purposes of the foregoing, Borrowings having different Interest
Periods, regardless of whether they commence on the same date, shall be
considered separate Borrowings.
     (c) Each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds to such
account in New York City as the Administrative Agent may designate not later
than 11:00 a.m., New York City time, and the

     
 
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Administrative Agent shall promptly credit the amounts so received to an account
of the applicable Borrower as directed by Administrative Borrower in the
applicable Borrowing Request maintained with the Administrative Agent or, if a
Borrowing shall not occur on such date because any condition precedent herein
specified shall not have been met, return the amounts so received to the
respective Lenders.
     (d) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender’s portion of such Borrowing,
the Administrative Agent may assume that such Lender has made such portion
available to the Administrative Agent on the date of such Borrowing in
accordance with paragraph (c) above, and the Administrative Agent may, in
reliance upon such assumption, make available to the applicable Borrower on such
date a corresponding amount. If the Administrative Agent shall have so made
funds available, then, to the extent that such Lender shall not have made such
portion available to the Administrative Agent, each of such Lender and such
Borrower severally agrees to repay to the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to such Borrower until the date such
amount is repaid to the Administrative Agent at (i) in the case of such
Borrower, the interest rate applicable at the time to the Loans comprising such
Borrowing and (ii) in the case of such Lender, the greater of the Interbank Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation. If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount shall constitute
such Lender’s Loan as part of such Borrowing for purposes of this Agreement, and
the applicable Borrower’s obligation to repay the Administrative Agent such
corresponding amount pursuant to this Section 2.02(d) shall cease.
     (e) Notwithstanding anything to the contrary contained herein, no Borrower
shall be entitled to request, or to elect to convert or continue, any Borrowing
if the Interest Period requested with respect thereto would end after the Final
Maturity Date.
SECTION 2.03 Borrowing Procedure.
     (a) To request a Borrowing, Administrative Borrower, on behalf of the
applicable Borrower, shall deliver, by hand delivery, telecopier or, to the
extent separately agreed by the Administrative Agent, by an electronic
communication in accordance with the second sentence of Section 11.01(b) and the
second paragraph of Section 11.01(d), a duly completed and executed Borrowing
Request to the Administrative Agent (i) in the case of a Eurocurrency Borrowing,
not later than 11:00 a.m., New York City time, three (3) Business Days before
the date of the proposed Borrowing, or (ii) in the case of an ABR Borrowing, not
later than 9:00 a.m., New York City time, on the date of the proposed Borrowing.
Each Borrowing Request shall be irrevocable and shall specify the following
information in compliance with Section 2.02:
     (i) the aggregate amount of such Borrowing;
     (ii) the date of such Borrowing, which shall be a Business Day;

     
 
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     (iii) whether such Borrowing shall constitute a Borrowing of U.S. Term
Loans or Canadian Term Loans;
     (iv) whether such Borrowing is to be an ABR Borrowing or a Eurocurrency
Borrowing;
     (v) in the case of a Eurocurrency Borrowing, the initial Interest Period to
be applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”;
     (vi) the location and number of the applicable Borrower’s account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.02(c);
     (vii) in the case of the initial Credit Extension hereunder or under any
Incremental Term Loan Commitments, that the conditions set forth in
Section 4.02(b) — (d) have been satisfied as of the date of the notice.
     If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurocurrency Borrowing, then Administrative Borrower on
behalf of the applicable Borrower shall be deemed to have selected an Interest
Period of one month’s duration. Promptly following receipt of a Borrowing
Request in accordance with this Section, the Administrative Agent shall advise
each applicable Lender of the details thereof and of the amount of such Lender’s
Loan to be made as part of the requested Borrowing.
     (b) Appointment of Administrative Borrower. Each Borrower hereby
irrevocably appoints and constitutes Administrative Borrower as its agent to
request Loans pursuant to this Agreement in the name or on behalf of such
Borrower. The Administrative Agent and Lenders may disburse the Loans to such
bank account of Administrative Borrower or a Borrower or otherwise make such
Loans to a Borrower as Administrative Borrower may designate or direct, without
notice to any other Borrower or Guarantor. Administrative Borrower hereby
accepts the appointment by Borrowers to act as the agent of Borrowers and agrees
to ensure that the disbursement of any Loans to a Borrower requested by or paid
to or for the account of such Borrower shall be paid to or for the account of
such Borrower. Each Borrower hereby irrevocably appoints and constitutes
Administrative Borrower as its agent to receive statements on account and all
other notices from the Agents and Lenders with respect to the Obligations or
otherwise under or in connection with this Agreement and the other Loan
Documents, including the Intercreditor Agreement. Any notice, election,
representation, warranty, agreement or undertaking by or on behalf of any other
Borrower by Administrative Borrower shall be deemed for all purposes to have
been made by such Borrower, as the case may be, and shall be binding upon and
enforceable against such Borrower to the same extent as if made directly by such
Borrower. No purported termination of the appointment of Administrative Borrower
as agent as aforesaid shall be effective, except after ten (10) days’ prior
written notice to the Administrative Agent and appointment by the Borrowers of a
replacement Administrative Borrower.
SECTION 2.04 Repayment of Loans; Evidence of Debt.

     
 
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     (a) Promise to Repay. The U.S. Borrower hereby unconditionally promises to
pay to the Administrative Agent, for the account of each applicable Lender, the
then unpaid principal amount of each U.S. Term Loan of such Lender on the Final
Maturity Date. Canadian Borrower hereby unconditionally promises to pay to the
Administrative Agent, for the account of each applicable Lender, the then unpaid
principal amount of each Canadian Term Loan of such Lender on the Final Maturity
Date. All payments or repayments of Loans made pursuant to this Section 2.04(a)
shall be made in Dollars.
     (b) Lender and Administrative Agent Records. Each Lender shall maintain in
accordance with its usual practice an account or accounts evidencing the
Indebtedness of each Borrower to such Lender resulting from each Loan made by
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time under this Agreement. The
Administrative Agent shall maintain accounts in which it will record (i) the
amount of each Loan made hereunder, the Borrower to which such Loan is made, the
Type and Class thereof and the Interest Period applicable thereto; (ii) the
amount of any principal or interest due and payable or to become due and payable
from each Borrower to each Lender hereunder; and (iii) the amount of any sum
received by the Administrative Agent hereunder for the account of the Lenders
and each Lender’s share thereof. The entries made in the accounts maintained
pursuant to this paragraph shall be prima facie evidence of the existence and
amounts of the obligations therein recorded as well as the Borrower which
received such Loans; provided that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall not in
any manner affect the obligations of any Borrower to repay the Loans in
accordance with their terms.
     (c) Promissory Notes. Any Lender by written notice to Administrative
Borrower (with a copy to the Administrative Agent) may request that Loans of any
Class made by it be evidenced by a promissory note. In such event, the
applicable Borrower or Borrowers shall prepare, execute and deliver to such
Lender one or more promissory notes payable to such Lender or its registered
assigns in the form of Exhibit K-1 or K-2, as the case may be. Thereafter, the
Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 11.04) be represented by one or
more promissory notes in such form payable to such payee or its registered
assigns.
SECTION 2.05 Fees.
     (a) Fees. Canadian Borrower agrees to pay or to cause the applicable
Borrower to pay all Fees payable pursuant to the Fee Letter, in the amounts and
on the dates set forth therein.
     (b) All Fees shall be paid on the dates due, in immediately available funds
in dollars, to the Administrative Agent. Once paid, none of the Fees shall be
refundable under any circumstances.
SECTION 2.06 Interest on Loans.
     (a) ABR Loans. Subject to the provisions of Section 2.06(c), the Loans
comprising each ABR Borrowing shall bear interest at a rate per annum equal to
the Alternate Base Rate plus the Applicable Margin in effect from time to time.

     
 
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     (b) Eurocurrency Loans. Subject to the provisions of Section 2.06(c), the
Loans comprising each Eurocurrency Borrowing shall bear interest at a rate per
annum equal to the Adjusted LIBOR Rate for the Interest Period in effect for
such Borrowing plus the Applicable Margin in effect from time to time.
     (c) Default Rate. Notwithstanding the foregoing, if at any time any
principal of or interest on any Loan or any fee or other amount payable by the
Loan Parties hereunder has not been paid when due, whether at stated maturity,
upon acceleration or otherwise and for so long as such amounts have not been
paid, all Obligations shall, to the extent permitted by applicable law, bear
interest, after as well as before judgment, at a per annum rate equal to (i) in
the case of principal of or interest on any Loan, 2% plus the rate otherwise
applicable to such Loan as provided in the preceding paragraphs of this
Section 2.06 or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Loans as provided in Section 2.06(a) (in either case, the
“Default Rate”).
     (d) Interest Payment Dates. Accrued interest on each Loan shall be payable
in arrears on each Interest Payment Date for such Loan; provided that
(i) interest accrued pursuant to Section 2.06(c) shall be payable on demand,
(ii) in the event of any repayment or prepayment of any Loan, accrued interest
on the principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the event of any conversion of any
Eurocurrency Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.
     (e) Interest Calculation. All interest hereunder shall be computed on the
basis of a year of 360 days, except that interest computed by reference to the
Alternate Base Rate shall be computed on the basis of a year of 365 days (or
366 days in a leap year) and, in each case, shall be payable for the actual
number of days elapsed (including the first day but excluding the last day). The
applicable Alternate Base Rate or Adjusted LIBOR Rate shall be determined by the
Administrative Agent in accordance with the provisions of this Agreement and
such determination shall be conclusive absent manifest error.
     (f) Currency for Payment of Interest. All interest paid or payable pursuant
to this Section 2.06 shall be paid in Dollars.
SECTION 2.07 Termination of Commitments. The Term Loan Commitments shall
automatically terminate at 5:00 p.m., New York City time, on the Closing Date.
SECTION 2.08 Interest Elections.
     (a) Generally. Each Borrowing initially shall be of the Type specified in
the applicable Borrowing Request and, in the case of a Eurocurrency Borrowing,
shall have an initial Interest Period as specified in such Borrowing Request.
Thereafter, Administrative Borrower may elect to convert such Borrowing to an
ABR Borrowing or to rollover or continue such Borrowing and, in the case of a
Eurocurrency Borrowing, may elect Interest Periods therefor, all as provided in
this Section. Administrative Borrower may elect different options with respect
to different portions (not less than the Minimum Amount) of the affected
Borrowing, in which case each such portion shall be allocated ratably among the
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such Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing. Notwithstanding anything to the contrary, Borrowers shall
not be entitled to request any conversion, rollover or continuation that, if
made, would result in more than eight (8) Eurocurrency Borrowings of U.S. Term
Loans or more than four (4) Eurocurrency Borrowings of Canadian Term Loans
outstanding hereunder at any one time.
     (b) Interest Election Notice. To make an election pursuant to this Section,
Administrative Borrower shall deliver, by hand delivery or telecopier, a duly
completed and executed Interest Election Request to the Administrative Agent not
later than the time that a Borrowing Request would be required under
Section 2.03 if Administrative Borrower were requesting a Borrowing of the Type
resulting from such election to be made on the effective date of such election.
Each Interest Election Request shall be irrevocable. Each Interest Election
Request shall specify the following information in compliance with Section 2.02:
     (i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof,
or if outstanding Borrowings are being combined, allocation to each resulting
Borrowing (in which case the information to be specified pursuant to clauses
(iii) and (iv) below shall be specified for each resulting Borrowing);
     (ii) the effective date of the election made pursuant to such Interest
Election Request, which shall be a Business Day;
     (iii) whether such Borrowing is to be an ABR Borrowing or a Eurocurrency
Borrowing;
     (iv) if the resulting Borrowing is a Eurocurrency Borrowing, the Interest
Period to be applicable thereto after giving effect to such election, which
shall be a period contemplated, as applicable, by the definition of the term
“Interest Period”.
     If any such Interest Election Request requests a Eurocurrency Borrowing but
does not specify an Interest Period, then applicable Borrower shall be deemed to
have selected an Interest Period of one month’s duration.
     Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender’s portion of each resulting Borrowing.
     (c) Automatic Conversion to ABR Borrowings. If an Interest Election Request
with respect to a Eurocurrency Borrowing is not timely delivered prior to the
end of the Interest Period applicable thereto, then, unless such Borrowing is
repaid as provided herein, at the end of such Interest Period such Borrowing
shall be converted to an ABR Borrowing. Notwithstanding any contrary provision
hereof, if an Event of Default has occurred and is continuing, the
Administrative Agent or the Required Lenders may require, by notice to
Administrative Borrower, that (i) no outstanding Borrowing may be converted to
or continued as a Eurocurrency Borrowing and (ii) unless repaid, each
Eurocurrency Borrowing shall be converted to an ABR Borrowing at the end of the
Interest Period applicable thereto.

     
 
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SECTION 2.09 Amortization of Term Loan Borrowings.
     (a) U.S. Borrower shall pay to the Administrative Agent, for the account of
the Lenders, on the dates set forth on Annex II, or if any such date is not a
Business Day, on the immediately preceding Business Day (each such date, a “Term
Loan Repayment Date”), a principal amount of the U.S. Term Loans equal to the
amount set forth on Annex II for such date (as adjusted from time to time
pursuant to Section 2.10(h)), together in each case with accrued and unpaid
interest on the principal amount to be paid to but excluding the date of such
payment. Canadian Borrower shall pay to the Administrative Agent, for the
account of the Lenders, on each Term Loan Repayment Date, a principal amount of
the Canadian Term Loans equal to the amount set forth on Annex II for such date
(as adjusted from time to time pursuant to Section 2.10(h)), together in each
case with accrued and unpaid interest on the principal amount to be paid to but
excluding the date of such payment.
     (b) Notwithstanding the foregoing provisions of this Section 2.09, if any
scheduled repayment of Canadian Term Loans required under this Section 2.09
(together with the aggregate amount of all prior (x) prepayments of Canadian
Term Loans made pursuant to Section 2.10(d), (e) and (g), and Section 2.10(c)
(to the extent arising from an Asset Sale of the type described in clause (b) of
the definition thereof), and (y) scheduled repayments of Canadian Term Loans
made pursuant to this Section 2.09) would result in more than 25.0% of the
original outstanding principal amount of the Canadian Term Loans borrowed on any
date being repaid on or before the applicable 525 Catch-Up Date, then, solely to
the extent necessary to avoid such repayment within such time period, such
repayment amount (a “525 Amortization Amount”) shall be applied first, to the
prepayment of the U.S. Term Loans in accordance with clauses (iii) through
(vi) of Section 2.10(h) and second, if no U.S. Term Loans are then outstanding,
deposited in the 525 Collateral Account and applied in accordance with
Section 2.10(j) on the first day following the 525 Catch-Up Date. The term “525
Collateral Account” shall mean a cash collateral account established with a
financial institution reasonably satisfactory to the Administrative Agent (which
shall not be a Lender or an Affiliate of a Lender) on terms and conditions (and
subject to a Control Agreement) reasonably satisfactory to the Administrative
Agent and will be subject to a First Priority security interest in favor of the
Collateral Agent for the ratable benefit of the Secured Parties to secure the
Obligations. Beneficial ownership of all funds held in the Prepayment Collateral
Account will remain with Canadian Borrower and Canadian Borrower shall at all
times be entitled to access such funds solely for purposes of (i) optional
prepayments of Canadian Term Loans in accordance with Section 2.10(a),
(ii) mandatory prepayments of Canadian Term Loans in accordance with
Section 2.10(j) and (iii) Permitted Uses, and all gains, losses and income from
the investment or use of such funds shall be for the account of, and, in the
case of gains and income, shall be distributed to, Canadian Borrower.
     (c) To the extent not previously paid, all U.S. Term Loans and all Canadian
Term Loans shall be due and payable on the Final Maturity Date.
SECTION 2.10 Optional and Mandatory Prepayments of Loans.
     (a) Optional Prepayments. Borrowers shall have the right at any time and
from time to time to prepay any Borrowing, in whole or in part, subject to the
requirements of this Section 2.10; provided that each partial prepayment shall
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(and in integral amounts consistent with) the Minimum Amount or, if less, the
outstanding principal amount of such Borrowing.
     (b) Net Cash Proceeds Account. Subject to the terms of the Intercreditor
Agreement, the Net Cash Proceeds of any Term Loan Priority Collateral arising
from an Asset Sale or Casualty Event which Net Cash Proceeds are being
reinvested in accordance with Sections 2.10(c) or (f), respectively, shall be
deposited in one or more Net Cash Proceeds Accounts pending final application of
such proceeds (and any products of such proceeds) in accordance with the terms
hereof (provided that prior to such final application, and without affecting the
Borrowers’ obligations under Sections 2.10(c) and (f), such proceeds may be
utilized to make repayments of the Revolving Credit Loans without reducing
Revolving Credit Commitments).
     (c) Asset Sales. Not later than three (3) Business Days following the
receipt of any Net Cash Proceeds of any Asset Sale by Holdings or any of its
Subsidiaries, Borrowers shall make prepayments and prepayment offers in
accordance with Section 2.10(h) and (i) in an aggregate amount equal to 100% of
such Net Cash Proceeds; provided that:
          (i) no such prepayment or prepayment offer shall be required under
this Section 2.10(c) with respect to (A) any Asset Sale permitted by
Section 6.06 other than clauses (b), (i) and (k) thereof, (B) the disposition of
property which constitutes a Casualty Event, or (C) Asset Sales for fair market
value resulting in less than $5 million in Net Cash Proceeds in any fiscal year;
and
          (ii) so long as no Event of Default shall then exist or would arise
therefrom, such proceeds shall not be required to be so applied on such date to
the extent that Administrative Borrower shall have delivered an Officers’
Certificate to the Administrative Agent on or prior to such date stating that
such Net Cash Proceeds are expected to be reinvested in fixed or capital assets
or to make Permitted Acquisitions (and, in the case of Net Cash Proceeds from an
Asset Sale made pursuant to Section 6.06(k), such Net Cash Proceeds may also be
used to make investments in joint ventures so long as a Company owns at least
50% of the Equity Interests in such joint venture) within 365 days following the
date of such Asset Sale (which Officers’ Certificate shall set forth the
estimates of the proceeds to be so expended); provided that if all or any
portion of such Net Cash Proceeds is not so reinvested within such 365-day
period, such unused portion shall be applied on the last day of such period to
mandatory prepayments and prepayment offers as provided in this Section 2.10(c);
provided, further, that if the property subject to such Asset Sale constituted
Collateral, then all property purchased with the Net Cash Proceeds thereof
pursuant to this subsection shall be made subject to the Lien of the applicable
Security Documents in favor of the Collateral Agent, for its benefit and for the
benefit of the other Secured Parties in accordance with Sections 5.11 and 5.12.
     (d) Debt Issuance or Preferred Stock Issuance. Not later than one
(1) Business Day following the receipt of any Net Cash Proceeds of any Debt
Issuance or Preferred Stock Issuance by Holdings or any of its Subsidiaries,
Borrowers shall make prepayments in accordance with Section 2.10(h) and (i) in
an aggregate amount equal to 100% of such Net Cash Proceeds; provided that if,
at the time of any such prepayment with the Net Cash Proceeds of any Preferred
Stock Issuance pursuant to this Section 2.10(d) Excess Availability shall be
less than $90 million immediately prior to or after giving effect to such
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the Revolving Credit Agreement on such date, such prepayment shall be applied
first, to the repayment of outstandings under the Revolving Credit Agreement
until Excess Availability (after giving effect to all extensions of credit under
the Revolving Credit Agreement on such date) equals $90 million and second, to
the extent of any remaining amounts, to make prepayments in accordance with
Sections 2.10(h) and (i).
     (e) Equity Issuance. Not later than three (3) Business Days following the
receipt of any Net Cash Proceeds of any Equity Issuance, Borrowers shall make
prepayments in accordance with Section 2.10(h) and (i) in an aggregate amount
equal to 50% of such Net Cash Proceeds; provided, however, that if on the date
of such Equity Issuance, (i) no Default has occurred and is continuing and
(ii) the Senior Secured Leverage Ratio is less than 3.0 to 1.0, then no such
prepayment shall be required to be made in respect of such Equity Issuance;
provided, further, that this clause (e) shall not apply to the proceeds of any
Qualified Capital Stock issued by Holdings after the Closing Date to the
Acquiror or any of its Affiliates; and provided, further, that if, at the time
of any such prepayment pursuant to this Section 2.10(e) Excess Availability
shall be less than $90 million immediately prior to or after giving effect to
such prepayment and all extensions of credit under the Revolving Credit
Agreement on such date, such prepayment shall be applied first, to the repayment
of outstandings under the Revolving Credit Agreement until Excess Availability
(after giving effect to all extensions of credit under the Revolving Credit
Agreement on such date) equals $90 million and second, to the extent of any
remaining amounts, to make prepayments in accordance with Sections 2.10(h) and
(i).
     (f) Casualty Events. Not later than three (3) Business Days following the
receipt of any Net Cash Proceeds from a Casualty Event by Holdings or any of its
Subsidiaries, Borrowers shall make prepayments and prepayment offers in
accordance with Section 2.10(h) and (i) in an aggregate amount equal to 100% of
such Net Cash Proceeds; provided that:
          (i) so long as no Event of Default shall then exist or arise
therefrom, such proceeds shall not be required to be so applied on such date to
the extent that (A) in the event such Net Cash Proceeds exceed $1 million but
shall not exceed $20 million, Administrative Borrower shall have delivered an
Officers’ Certificate to the Administrative Agent on or prior to such date
stating that such proceeds are expected to be used, or (B) in the event that
such Net Cash Proceeds exceed $20 million, the Administrative Agent (to the
extent such Casualty Event relates to Term Loan Priority Collateral) has agreed
by notice to Administrative Borrower on or prior to such date to allow such
proceeds to be used, in each case, to repair, replace or restore any property in
respect of which such Net Cash Proceeds were paid or to reinvest in other fixed
or capital assets, no later than 365 days following the date of receipt of such
proceeds; provided that if the property subject to such Casualty Event
constituted Collateral under the Security Documents, then all property purchased
with the Net Cash Proceeds thereof pursuant to this subsection shall be made
subject to the Lien of the applicable Security Documents in favor of the
Collateral Agent, for its benefit and for the benefit of the other Secured
Parties in accordance with Sections 5.11 and 5.12; and
          (ii) if any portion of such Net Cash Proceeds shall not be so applied
within such 365-day period, such unused portion shall be applied on the last day
of such period to mandatory prepayments and prepayment offers as provided in
this Section 2.10(f).

     
 
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     (g) Excess Cash Flow. No later than five (5) Business Days after the
earlier of (i) 90 days after the end of each Excess Cash Flow Period and
(ii) the date on which the financial statements with respect to such fiscal year
in which such Excess Cash Flow Period occurs are delivered pursuant to
Section 5.01(a), Borrower shall make prepayments in accordance with
Sections 2.10(h) and (i) in an aggregate amount equal to 50% of Excess Cash Flow
for the Excess Cash Flow Period then ended; provided, however, that if (i) on
the date such prepayment is required to be made, no Event of Default has
occurred and is continuing, and (ii) the Senior Secured Leverage Ratio, as of
the last day of such Excess Cash Flow Period, is less than 3.0 to 1.0, then such
percentage shall be 25%.
     (h) Application of Prepayments and Prepayment Offers. (i) In the event any
optional prepayment, or any mandatory prepayment pursuant to Section 2.10(d),
(e) or (g) or Section 2.10(c) (to the extent arising from an Asset Sale of the
type described in clause (b) of the definition thereof) is made at a time when
Term Loan Borrowings of more than one Class remain outstanding, the aggregate
amount of such prepayment shall be allocated between the U.S. Term Loans and the
Canadian Term Loans in the manner directed by Administrative Borrower.
          (ii) Amounts required to be applied to mandatory prepayments and
prepayment offers pursuant to Section 2.10(c) (except to the extent arising from
an Asset Sale of the type described in clause (b) of the definition thereof) and
(f) shall be allocated between the U.S. Term Loans and the Canadian Term Loans
in the manner directed by Administrative Borrower. Amounts allocated in respect
of the U.S. Term Loans shall be applied as mandatory prepayments as set forth
below in this Section 2.10(h) and amounts allocated in respect of Canadian Term
Loans shall be offered for prepayment as set forth in Section 2.10(i)(ii).
          (iii) Prior to any optional or mandatory prepayment and/or prepayment
offer hereunder, Administrative Borrower shall select the Borrowing or
Borrowings to be prepaid and/or offered to be prepaid and shall specify such
selection in the notice of such prepayment and/or prepayment offer pursuant to
Section 2.10(i), subject to the provisions of this Section 2.10(h); provided
that after an Event of Default has occurred and is continuing or after the
acceleration of the Obligations, Section 8.03 shall apply.
          (iv) Any prepayments of any Class of Term Loans pursuant to
Section 2.10(a), (c), (d), (e), (f), (g) and (j) shall be applied to reduce
scheduled repayments of such Class of Term Loans required under Section 2.09 on
a pro rata basis among the repayments of such Class remaining to be made on each
Term Loan Repayment Date.
          (v) Amounts to be applied pursuant to this Section 2.10 to the
prepayment of Term Loans (including any amounts in respect of prepayment offers
that have been accepted by Lenders) shall be applied first to reduce outstanding
ABR Loans. Any amounts remaining after each such application shall be applied to
prepay Eurocurrency Loans.
          (vi) Notwithstanding any of the foregoing, (A) if the amount of any
prepayment of Loans required under this Section 2.10 shall be in excess of the
amount of the ABR Loans at the time outstanding (an “Excess Amount”), only the
portion of the amount of such prepayment as is equal to the amount of such
outstanding ABR Loans shall be immediately prepaid and, at the election of
Administrative Borrower, the Excess Amount shall be either (1) deposited in an

     
 
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escrow account on terms satisfactory to the Collateral Agent and applied to the
prepayment of Eurocurrency Loans on the last day of the then next-expiring
Interest Period for Eurocurrency Loans; provided that (i) interest in respect of
such Excess Amount shall continue to accrue thereon at the rate provided
hereunder for the Loans which such Excess Amount is intended to repay until such
Excess Amount shall have been used in full to repay such Loans and (ii) at any
time while a Default has occurred and is continuing, the Administrative Agent
may, and upon written direction from the Required Lenders shall, apply any or
all proceeds then on deposit to the payment of such Loans in an amount equal to
such Excess Amount or (2) prepaid immediately, together with any amounts owing
to the Lenders under Section 2.13 and (B) if any prepayment of Canadian Term
Loans required under Section 2.10(d), (e) or (g) or Section 2.10(c) (to the
extent arising from an Asset Sale of the type described in clause (b) of the
definition thereof) (together with the aggregate amount of all prior
(x) prepayments of Canadian Term Loans made pursuant to Section 2.10(d), (e) and
(g) and Section 2.10(c) (to the extent arising from an Asset Sale of the type
described in clause (b) of the definition thereof) and (y) scheduled repayments
of Canadian Term Loans made pursuant to Section 2.09) would result in more than
25.0% of the original outstanding principal amount of the Canadian Term Loans
borrowed on any date being repaid on or before the applicable 525 Catch-Up Date,
then, solely to the extent necessary to avoid such repayment within such time
period, such prepayment amount (a “525 Prepayment Amount”) shall be applied
first, to the prepayment of the U.S. Term Loans in accordance with clauses
(iii) through (vi) of Section 2.10(h) and second, if no U.S. Term Loans are then
outstanding, deposited in the 525 Collateral Account and applied in accordance
with Section 2.10(j) on the first day following the 525 Catch-Up Date (and,
prior to such date, as permitted by the final sentence of Section 2.09(b)).
           (i) Notice of Prepayments and Prepayment Offers. (i) Administrative
Borrower shall notify the Administrative Agent by written notice of any
prepayment hereunder (A) in the case of prepayment of a Eurocurrency Borrowing,
not later than 11:00 a.m., New York City time, three (3) Business Days before
the date of prepayment, and (B) in the case of prepayment of a ABR Borrowing,
not later than 11:00 a.m., New York City time, one (1) Business Day before the
date of prepayment. Each such notice shall be irrevocable. Each such notice
shall specify the prepayment date, the principal amount of each Borrowing or
portion thereof to be prepaid and, in the case of a mandatory prepayment, a
reasonably detailed calculation of the amount of such prepayment. Promptly
following receipt of any such notice, the Administrative Agent shall advise the
Lenders of the contents thereof.
          (ii) With respect to any amounts in respect of the Net Cash Proceeds
of Asset Sales or Casualty Events that are allocated to Canadian Term Loans
pursuant to Section 2.10(h)(ii) (such amounts, the “Prepayment Offer Amounts”),
Administrative Borrower will, on the applicable payment date specified in
Section 2.10(c) or (f), as the case may be, notify the Administrative Agent by
telephonic notice (promptly confirmed in writing) specifying the Type of each
Canadian Term Loan being offered to be prepaid and the principal amount of each
such Loan (or portion thereof) being offered to be prepaid, and shall provide to
each Lender that holds a Canadian Term Loan notice of such prepayment offer
(each, a “Prepayment Offer Notice”). Each Prepayment Offer Notice shall
(A) include an offer by Canadian Borrower to prepay on the date that is five
(5) Business Days after the date of the Prepayment Offer Notice, the relevant
Canadian Term Loans of such Lender in an amount equal to the portion of the
Prepayment Offer Amount indicated in such Lender’s Prepayment Offer Notice as
being applicable to such

     
 
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Lender’s Canadian Term Loans (which shall equal such Lender’s ratable share of
the Prepayment Offer Amounts, based on the proportion that such Lender’s
Canadian Tem Loans bears to all Canadian Term Loans), (B) specify the principal
amount of each Borrowing or portion thereof being offered to be prepaid and
(C) set forth the option of such Lender to (x) accept or decline such offer or
(y) accept such offer and accept or decline Prepayment Offer Amounts declined by
other Lenders. Each such Lender shall notify the Administrative Agent no later
than 12:00 Noon, New York City time on the second Business Day immediately
preceding the date on which such prepayment is to be made of its intent to
accept such offer for prepayment or decline such offer (and, if such offer is
accepted by such Lender, the amount of Canadian Term Loans with respect to which
such Lender shall elect to accept the offer of prepayment and whether such
Lender shall accept Prepayment Offer Amounts declined by other Lenders);
provided that to the extent any such Lender shall not notify the Administrative
Agent by such time, such Lender shall be deemed to have accepted such offer for
prepayment and not elected to accept any such declined Prepayment Offer Amounts.
After application of Prepayment Offer Amounts to mandatory prepayments of the
Canadian Term Loans pursuant to this Section, and to the extent there are
Prepayment Offer Amounts remaining after such application, an amount equal to
the total of such amounts shall be applied to the prepayment of the U.S. Term
Loans in accordance with clauses (iii) through (vi) of Section 2.10(h).
          (iii) Each partial prepayment of any Borrowing shall be in an amount
that would be permitted in the case of a Credit Extension of the same Type as
provided in Section 2.02(a), except as necessary to apply fully the required
amount of a mandatory prepayment. Each prepayment of a Borrowing shall be
applied ratably to the Loans included in the prepaid Borrowing and otherwise in
accordance with this Section 2.10. Prepayments shall be accompanied by accrued
interest to the extent required by Section 2.06.
     (j) On the first day following the 525 Catch-Up Date with respect to any
Canadian Term Loans, such Canadian Term Loans shall be prepaid, in accordance
with clauses (iii) through (vi) of Section 2.10(h), in an amount equal to the
aggregate of all 525 Amortization Amounts and 525 Prepayment Amounts originally
deposited in the 525 Collateral Account in respect of prepayments and
amortization payments on such Canadian Term Loans (and without regard to the
amount actually on deposit on the 525 Collateral Account at such time); provided
that the amount of any such prepayment shall be decreased by the amount of any
optional prepayments of such Canadian Term Loans made with funds held in the 525
Collateral Account.
SECTION 2.11 Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a Eurocurrency Borrowing:
     (a) the Administrative Agent determines (which determination shall be final
and conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBOR Rate for such Interest Period; or
     (b) the Administrative Agent is advised in writing by the Required Lenders
that the Adjusted LIBOR Rate for such Interest Period will not adequately and
fairly reflect the cost to such Lenders of making or maintaining their Loans
included in such Borrowing for such Interest Period;

     
 
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then the Administrative Agent shall give written notice thereof to
Administrative Borrower and the Lenders as promptly as practicable thereafter
and, until the Administrative Agent notifies Administrative Borrower and the
Lenders that the circumstances giving rise to such notice no longer exist,
(i) any Interest Election Request that requests the conversion of any Borrowing
to, or continuation of any Borrowing as, a Eurocurrency Borrowing shall be
ineffective and (ii) if any Borrowing Request requests a Eurocurrency Borrowing,
such Borrowing shall be made as an ABR Borrowing.
SECTION 2.12 Yield Protection; Change in Law Generally.
     (a) Increased Costs Generally. If any Change in Law shall:
          (i) impose, modify or deem applicable any reserve, special deposit,
compulsory loan, insurance charge or similar requirement against assets of,
deposits with or for the account of, or credit extended or participated in, by
any Lender (except any reserve requirement reflected in the Adjusted LIBOR
Rate);
          (ii) subject any Lender to any Tax of any kind whatsoever with respect
to this Agreement or any Eurocurrency Loan made by it, or change the basis of
taxation of payments to such Lender in respect thereof (except for Indemnified
Taxes or Other Taxes covered by Section 2.15 and the imposition of, or any
change in the rate of, any Excluded Tax payable by such Lender); or
          (iii) impose on any Lender or the interbank market any other
condition, cost or expense affecting this Agreement or Eurocurrency Loans made
by such Lender;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurocurrency Loan (or of maintaining its
obligation to make any such Loan), or to reduce the amount of any sum received
or receivable by such Lender hereunder (whether of principal, interest or any
other amount), then, upon request of such Lender, Borrowers will pay to such
Lender, as the case may be, such additional amount or amounts as will compensate
such Lender, as the case may be, for such additional costs incurred or reduction
suffered.
     (b) Capital Requirements. If any Lender determines (in good faith, but in
its sole absolute discretion) that any Change in Law affecting such Lender or
any lending office of such Lender or such Lender’s holding company, if any,
regarding capital requirements has or would have the effect of reducing the rate
of return on such Lender’s capital or on the capital of such Lender’s holding
company, if any, as a consequence of this Agreement, the Commitments of such
Lender or the Loans made by such Lender, to a level below that which such Lender
or such Lender’s holding company could have achieved but for such Change in Law
(taking into consideration such Lender’s policies and the policies of such
Lender’s holding company with respect to capital adequacy), then from time to
time Borrowers will pay to such Lender, as the case may be, such additional
amount or amounts as will compensate such Lender or such Lender’s holding
company for any such reduction suffered.
     (c) Certificates for Reimbursement. A certificate of a Lender setting forth
the amount or amounts necessary to compensate such Lender or its holding
company, as the case may be, as specified in paragraph (a) or (b) of this
Section 2.12 and delivered to Administrative

     
 
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Borrower shall be conclusive absent manifest error. Borrowers shall pay such
Lender, as the case may be, the amount shown as due on any such certificate
within ten (10) Business Days after receipt thereof.
     (d) Delay in Requests. Failure or delay on the part of any Lender to demand
compensation pursuant to this Section 2.12 shall not constitute a waiver of such
Lender’s right to demand such compensation; provided that Borrowers shall not be
required to compensate a Lender pursuant to this Section for any increased costs
incurred or reductions suffered more than nine months prior to the date that
such Lender, as the case may be, notifies Administrative Borrower of the Change
in Law giving rise to such increased costs or reductions and of such Lender’s
intention to claim compensation therefor (except that, if the Change in Law
giving rise to such increased costs or reductions is retroactive, then the
nine-month period referred to above shall be extended to include the period of
retroactive effect thereof).
     (e) Change in Legality Generally. Notwithstanding any other provision of
this Agreement, if any Change in Law shall make it unlawful for any Lender to
make or maintain any Eurocurrency Loan or to give effect to its obligations as
contemplated hereby with respect to any Eurocurrency Loan, then, upon written
notice by such Lender to Administrative Borrower and the Administrative Agent:
          (i) the Commitments of such Lender (if any) to fund the affected Type
of Loan shall immediately terminate; and
          (ii) (x) such Lender may declare that Eurocurrency Loans will not
thereafter (for the duration of such unlawfulness) be continued for additional
Interest Periods and ABR Loans will not thereafter (for such duration) be
converted into Eurocurrency Loans, whereupon any request to convert an ABR
Borrowing to a Eurocurrency Borrowing or to continue a Eurocurrency Borrowing
for an additional Interest Period shall, as to such Lender only, be deemed a
request to continue an ABR Loan as such, or to convert a Eurocurrency Loan into
an ABR Loan, as the case may be, unless such declaration shall be subsequently
withdrawn and (y) all such outstanding Eurocurrency Loans made by such Lender
shall be automatically converted to ABR Loans on the last day of the then
current Interest Period therefor or, if earlier, on the date specified by such
Lender in such notice (which date shall be no earlier than the last day of any
applicable grace period permitted by applicable law).
SECTION 2.13 Breakage Payments. In the event of (a) the payment or prepayment,
whether optional or mandatory, of any principal of any Eurocurrency Loan earlier
than the last day of an Interest Period applicable thereto (including as a
result of an Event of Default), (b) the conversion of any Eurocurrency Loan
earlier than the last day of the Interest Period applicable thereto, (c) the
failure to borrow, convert, continue or prepay any Term Loan on the date
specified in any notice delivered pursuant hereto or (d) the assignment of any
Eurocurrency Loan earlier than the last day of the Interest Period applicable
thereto as a result of a request by Administrative Borrower pursuant to
Section 2.16(c), then, in any such event, the applicable Borrower shall
compensate each Lender for the loss, cost and expense attributable to such
event. In the case of any Eurocurrency Loan, such loss, cost or expense to any
Lender shall be deemed to include an amount determined by such Lender to be the
excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not

     
 
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occurred, at the Adjusted LIBOR Rate that would have been applicable to such
Loan, for the period from the date of such event to the last day of the then
current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period for
such Loan) (excluding, however, the Applicable Margin included therein, if any),
over (ii) the amount of interest which would accrue on such principal amount for
such period at the interest rate which such Lender would bid were it to bid, at
the commencement of such period, for deposits of a comparable currency, amount
and period from other banks in the applicable interbank market. A certificate of
any Lender setting forth in reasonable detail any amount or amounts that such
Lender is entitled to receive pursuant to this Section 2.13 shall be delivered
to Administrative Borrower (with a copy to the Administrative Agent) and shall
be conclusive and binding absent manifest error. The applicable Borrower shall
pay such Lender the amount shown as due on any such certificate within five
(5) days after receipt thereof.
SECTION 2.14 Payments Generally; Pro Rata Treatment; Sharing of Setoffs.
     (a) Payments Generally. Each Loan Party shall make each payment required to
be made by it hereunder or under any other Loan Document (whether of principal,
interest or fees, or of amounts payable under Section 2.12, Section 2.13,
Section 2.15, Section 2.16 or Section 11.03, or otherwise) on or before the time
expressly required hereunder or under such other Loan Document for such payment
(or, if no such time is expressly required, prior to 2:00 p.m., New York City
time), on the date when due, in immediately available funds, without setoff,
deduction or counterclaim. Any amounts received after such time on any date may,
in the discretion of the Administrative Agent, be deemed to have been received
on the next succeeding Business Day for purposes of calculating interest
thereon. All such payments shall be made to the Administrative Agent at its
offices at 677 Washington Boulevard, Stamford, Connecticut, except that payments
pursuant to Section 2.12, Section 2.13, Section 2.15, Section 2.16 and
Section 11.03 shall be made directly to the persons entitled thereto and
payments pursuant to other Loan Documents shall be made to the persons specified
therein. The Administrative Agent shall distribute any such payments received by
it for the account of any other person to the appropriate recipient promptly
following receipt thereof. If any payment under any Loan Document shall be due
on a day that is not a Business Day, unless specified otherwise, 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. All payments under each Loan Document shall be made in
dollars, except as expressly specified otherwise.
     (b) Pro Rata Treatment.
          (i) Each payment by Borrowers of interest in respect of the Loans of
any Class shall be applied to the amounts of such obligations owing to the
Lenders pro rata according to the respective amounts then due and owing to the
Lenders, except in the case of holders of Canadian Term Loans that have declined
prepayment offers with respect to interest on the principal amount prepaid in
such offer.
          (ii) Each payment by Borrowers on account of principal of the
Borrowings of any Class shall be made pro rata according to the respective
outstanding principal amounts of the Loans of such Class then held by the
Lenders, except in the case of holders of Canadian Term Loans that have declined
prepayment offers.

     
 
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     (c) Insufficient Funds. If at any time insufficient funds are received by
and available to the Administrative Agent to pay fully all amounts of principal,
interest and fees then due hereunder, such funds shall be applied (i) first,
toward payment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second, toward payment of principal then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal then due to such parties.
     (d) Sharing of Set-Off. Subject to the terms of the Intercreditor
Agreement, if any Lender shall, by exercising any right of setoff or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans or other Obligations resulting in such Lender’s
receiving payment of a proportion of the aggregate amount of its Loans and
accrued interest thereon or other Obligations greater than its pro rata share
thereof as provided herein, then the Lender receiving such greater proportion
shall (a) notify the Administrative Agent of such fact, and (b) purchase (for
cash at face value) participations in the Loans and such other obligations of
the other Lenders, or make such other adjustments as shall be equitable, so that
the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans and other amounts owing them, provided that:
          (i) if any such participations are purchased and all or any portion of
the payment giving rise thereto is recovered, such participations shall be
rescinded and the purchase price restored to the extent of such recovery,
without interest; and
          (ii) the provisions of this paragraph shall not be construed to apply
to (x) any payment made by any Loan Party pursuant to and in accordance with the
express terms of this Agreement or (y) any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans to any assignee or participant, other than to any Loan Party or any
Subsidiary thereof (as to which the provisions of this paragraph shall apply).
Each Loan Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable Requirements of Law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against such Loan Party rights of setoff and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of such Loan
Party in the amount of such participation. If under applicable bankruptcy,
insolvency or any similar law any Secured Party receives a secured claim in lieu
of a setoff or counterclaim to which this Section 2.14(d) applies, such Secured
Party shall to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights to which the Secured Party
is entitled under this Section 2.14(d) to share in the benefits of the recovery
of such secured claim.
     (e) Borrower Default. Unless the Administrative Agent shall have received
notice from Administrative Borrower prior to the date on which any payment is
due to the Administrative Agent for the account of the Lenders hereunder that
the applicable Borrower will not make such payment, the Administrative Agent may
assume that the applicable Borrower have made such payment on such date in
accordance herewith and may, in reliance upon such assumption, distribute to the
Lenders, as the case may be, the amount due. In such event, if the

     
 
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applicable Borrower have not in fact made such payment, then each of the
Lenders, as the case may be, severally agrees to repay to the Administrative
Agent forthwith on demand the amount so distributed to such Lender with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the Administrative Agent, at the
greater of the Interbank Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.
     (f) Lender Default. If any Lender shall fail to make any payment required
to be made by it pursuant to Section 2.02(c), Section 2.14(e) or
Section 11.03(c), then the Administrative Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Administrative Agent for the account of such Lender to satisfy
such Lender’s obligations under such Sections until all such unsatisfied
obligations are fully paid.
SECTION 2.15 Taxes.
     (a) Payments Free of Taxes. Any and all payments by or on account of any
obligation of the Loan Parties hereunder or under any other Loan Document shall
be made free and clear of and without reduction or withholding for any
Indemnified Taxes or Other Taxes; provided that if any Loan Party shall be
required by applicable Requirements of Law to deduct any Indemnified Taxes
(including any Other Taxes) from such payments, then (i) such Loan Party shall
increase the sum payable as necessary so that after all required deductions and
withholdings (including deductions and withholdings applicable to additional
sums payable under this Section) each Agent or Lender, as the case may be,
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the applicable Loan Party shall make such deductions
and (iii) the applicable Loan Party shall timely pay the full amount deducted to
the relevant Taxing Authority in accordance with applicable Requirements of Law.
     (b) Payment of Other Taxes by Borrowers. Without limiting the provisions of
paragraph (a) above, each Loan Party shall timely pay any Other Taxes to the
relevant Taxing Authority in accordance with applicable Requirements of Law.
     (c) Indemnification by Loan Parties. Each Loan Party shall indemnify each
Agent and each Lender, within ten (10) Business Days after demand therefor, for
the full amount of any Indemnified Taxes or Other Taxes (including Indemnified
Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section) paid by such Agent or such Lender, as the case may be, and
any penalties, interest and reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Taxing Authority. A
certificate as to the amount of such payment or liability delivered to
Administrative Borrower by a Lender (with a copy to the Administrative Agent),
or by an Agent on its own behalf or on behalf of a Lender, shall be conclusive
absent manifest error. No Borrower shall be obliged to provide indemnity under
this Section where the Indemnified Tax or Other Tax in question is
(i) compensated for by an increased payment under Sections 2.12(a)(ii) or
2.15(a) or (ii) would have been compensated for by an increased payment under
Section 2.15(a) but was not so compensated solely because of one of the
exclusions in that Section.

     
 
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     (d) Evidence of Payments. As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by any Loan Party to a Taxing Authority, the
relevant Loan Party shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Taxing Authority evidencing such
payment, a copy of the return reporting such payment or other evidence of such
payment reasonably satisfactory to the Administrative Agent.
     (e) Status of Lenders. Any Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
applicable Loan Party is resident for tax purposes, or any treaty to which such
jurisdiction is a party, with respect to payments hereunder or under any other
Loan Document shall, to the extent it may lawfully do so, deliver to
Administrative Borrower (with a copy to the Administrative Agent), at the time
or times prescribed by applicable Requirements of Law or reasonably requested by
Administrative Borrower or the Administrative Agent (and from time to time
thereafter, as requested by Administrative Borrower or Administrative Agent),
such properly completed and executed documentation prescribed by applicable
Requirements of Law or any subsequent replacement or substitute form that may
lawfully be provided as will permit such payments to be made without withholding
or at a reduced rate of withholding. In addition, any Lender, if requested by
Administrative Borrower or the Administrative Agent, shall deliver such other
documentation prescribed by applicable Requirements of Law or reasonably
requested by Administrative Borrower or the Administrative Agent as will enable
the applicable Loan Parties or the Administrative Agent to determine whether or
not such Lender is subject to backup withholding or information reporting
requirements; provided, however, that Administrative Borrower may treat any
Agent or Lender as an “exempt recipient” based on the indicators described in
Treasury Regulations Section 1.6049-4(c) and if it may be so treated, such Agent
or Lender shall not be required to provide such documentation, except to the
extent such documentation is required pursuant to the Treasury Regulations
promulgated under the Code Section 1441.
     Each Lender which so delivers any document requested by Administrative
Borrower or Administrative Agent in this Section 2.15(e) further undertakes to
deliver to Administrative Borrower (with a copy to Administrative Agent), upon
request of Administrative Borrower or Administrative Agent, copies of such
requested form (or a successor form) on or before the date that such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by
Administrative Borrower or Administrative Agent, in each case, unless an event
(including any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required that renders all
such forms inapplicable or that would prevent such Lender from duly completing
and delivering any such form with respect to it. For avoidance of doubt,
Borrowers shall not be required to pay additional amounts to any Lender or
Administrative Agent pursuant to this Section 2.15(e) to the extent the
obligation to pay such additional amount would not have arisen but for the
failure of such Lender or Administrative Agent to comply with this paragraph.
     (f) Treatment of Certain Refunds. If an Agent or a Lender determines, in
its sole discretion, that it has received a refund of, credit against, relief or
remission for any Indemnified Taxes or Other Taxes as to which it has been
indemnified by the Loan Parties or with respect to which any Loan Party has paid
additional amounts pursuant to this Section or Section 2.12(a)(ii), it shall pay
to such Loan Party an amount equal to such refund, credit, relief or remission
(but

     
 
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only to the extent of indemnity payments made, or additional amounts paid, by
such Loan Party under this Section with respect to the Indemnified Taxes or
Other Taxes giving rise to such refund or any additional amounts under
Section 2.12(a)(ii)), net of all reasonable and customary out-of-pocket expenses
of such Agent or Lender, as the case may be, and without interest (other than
any interest paid by the relevant Taxing Authority with respect to such refund
or any additional amounts under Section 2.12(a)(ii)); provided that each Loan
Party, upon the request of such Agent or such Lender, agrees to repay the amount
paid over to such Loan Party (plus any penalties, interest or other charges
imposed by the relevant Taxing Authority) to such Agent or such Lender in the
event such Agent or such Lender is required to repay such refund to such Taxing
Authority. Nothing in this Agreement shall be construed to require any Agent or
any Lender to make available its tax returns (or any other information relating
to its taxes that it deems confidential) to any Loan Party or any other person.
Notwithstanding anything to the contrary, in no event will any Agent or any
Lender be required to pay any amount to any Loan Party the payment of which
would place such Agent or such Lender in a less favorable net after-tax position
than such Agent or such Lender would have been in if the additional amounts
giving rise to such refund of any Indemnified Taxes or Other Taxes had never
been paid.
     (g) Co-operation. Notwithstanding anything to the contrary in Section
2.15(e), with respect to non-U.S. withholding taxes, the Administrative Agent,
the relevant Lender(s) (at the written request of the relevant Loan Party) and
the relevant Loan Party shall, co-operate in completing any procedural
formalities necessary (including delivering any documentation prescribed by the
applicable Requirement of Law and making any necessary reasonable approaches to
the relevant Taxing Authorities) for the relevant Loan Party to obtain
authorization to make a payment to which the Administrative Agent or such
Lender(s) is entitled without a deduction or withholding for, or on account of,
Taxes; provided, however, that none of the Administrative Agent or any Lender
shall be required to provide any documentation that it is not legally entitled
to provide, or take any action that, in the Administrative Agent’s or the
relevant Lender’s reasonable judgment, would subject the Administrative Agent or
such Lender to any material unreimbursed costs or otherwise be disadvantageous
to it in any material respect.
     (h) Tax Returns. If, as a result of executing a Loan Document, entering
into the transactions contemplated thereby or with respect thereto, receiving a
payment or enforcing its rights thereunder, any Agent or any Lender is required
to file a Tax Return in a jurisdiction in which it would not otherwise be
required file, the Loan Parties shall promptly provide such assistance as the
relevant Agent or Lender shall reasonably request with respect to the completion
and filing of such Tax Return. For clarification, any expenses incurred in
connection with such filing shall be subject to Section 11.03.
SECTION 2.16 Mitigation Obligations; Replacement of Lenders.
     (a) Designation of a Different Lending Office. Each Lender may at any time
or from time to time designate, by written notice to the Administrative Agent,
one or more lending offices (which, for this purpose, may include Affiliates of
the respective Lender) for the various Loans made by such Lender; provided that
to the extent such designation shall result, as of the time of such designation,
in increased costs under Section 2.12 or Section 2.15 in excess of those which
would be charged in the absence of the designation of a different lending office
(including a different Affiliate of the respective Lender), then the Borrowers
shall not be obligated to pay

     
 
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such excess increased costs (although the Borrowers, in accordance with and
pursuant to the other provisions of this Agreement, shall be obligated to pay
the costs which would apply in the absence of such designation and any
subsequent increased costs of the type described above resulting from changes
after the date of the respective designation). Each lending office and Affiliate
of any Lender designated as provided above shall, for all purposes of this
Agreement, be treated in the same manner as the respective Lender (and shall be
entitled to all indemnities and similar provisions in respect of its acting as
such hereunder). Each lending office and Affiliate of any Lender designated as
provided above shall, for all purposes of this Agreement, be treated in the same
manner as the respective Lender (and shall be entitled to all indemnities and
similar provisions in respect of its acting as such hereunder). The proviso to
the first sentence of this Section 2.16(a) shall not apply to changes in a
lending office pursuant to Section 2.16(b) if such change was made upon the
written request of the Administrative Borrower.
     (b) Mitigation Obligations. If any Lender requests compensation under
Section 2.12, or requires any Loan Party to pay any additional amount to any
Lender or any Taxing Authority for the account of any Lender pursuant to
Section 2.15, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 2.12 or
Section 2.15, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. Each Loan Party hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any such
designation or assignment. A certificate setting forth such costs and expenses
submitted by such Lender to Administrative Borrower shall be conclusive absent
manifest error.
     (c) Replacement of Lenders. If any Lender requests compensation under
Section 2.12, or if any Borrower is required to pay any additional amount to any
Lender or any Taxing Authority for the account of any Lender pursuant to
Section 2.15, or if any Lender defaults in its obligation to fund Loans
hereunder, or if Administrative Borrower exercises its replacement rights under
Section 11.02(d), then Borrowers may, at their sole expense and effort, upon
notice by Administrative Borrower to such Lender and the Administrative Agent,
require such Lender to assign and delegate, without recourse (in accordance with
and subject to the restrictions contained in, and consents required by,
Section 11.04), all of its interests, rights and obligations under this
Agreement and the other Loan Documents to an Eligible Assignee that shall assume
such obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that:
          (i) Borrowers or the assignee shall have paid to the Administrative
Agent the processing and recordation fee specified in Section 11.04(b);
          (ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans, accrued interest thereon, and all other
amounts payable to it hereunder and under the other Loan Documents (including
any amounts under Section 2.13), from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or the applicable Borrowers
(in the case of all other amounts);

     
 
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          (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.12 or payments required to be made pursuant to
Section 2.15, such assignment will result in a reduction in such compensation or
payments thereafter; and
          (iv) such assignment does not conflict with applicable Requirements of
Law.
A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling Borrowers to require such assignment and delegation
cease to apply.
SECTION 2.17 [INTENTIONALLY OMITTED].
SECTION 2.18 [INTENTIONALLY OMITTED].
SECTION 2.19 Interest Act (Canada); Criminal Rate of Interest; Nominal Rate of
Interest.
     (a) Notwithstanding anything to the contrary contained in this Agreement or
in any other Loan Document, solely to the extent that a court of competent
jurisdiction finally determines that the calculation or determination of
interest or any fee payable by the any Canadian Loan Party in respect of the
Obligations pursuant to this Agreement and the other Loan Documents shall be
governed by the laws of any province of Canada or the federal laws of Canada, in
no event shall the aggregate interest (as defined in Section 347 of the Criminal
Code, R.S.C. 1985, c. C-46, as the same shall be amended, replaced or re-enacted
from time to time, “Section 347”) payable by the Canadian Loan Parties to the
Agents or any Lender under this Agreement or any other Loan Document exceed the
effective annual rate of interest on the Credit advances (as defined in
Section 347) under this Agreement or such other Loan Document lawfully permitted
under Section 347 and, if any payment, collection or demand pursuant to this
Agreement or any other Loan Document in respect of Interest (as defined in
Section 347) is determined to be contrary to the provisions of Section 347, such
payment, collection or demand shall be deemed to have been made by mutual
mistake of the Agents, the Lenders and the Canadian Loan Parties and the amount
of such payment or collection shall be refunded by the relevant Agents and
Lenders to the applicable Canadian Loan Parties. For the purposes of this
Agreement and each other Loan Document to which the Canadian Loan Parties are a
party, the effective annual rate of interest payable by the Canadian Loan
Parties shall be determined in accordance with generally accepted actuarial
practices and principles over the term of the loans on the basis of annual
compounding for the lawfully permitted rate of interest and, in the event of
dispute, a certificate of a Fellow of the Canadian Institute of Actuaries
appointed by the for the account of the Canadian Loan Parties will be conclusive
for the purpose of such determination in the absence of evidence to the
contrary.
     (b) For the purposes of the Interest Act (Canada) and with respect to
Canadian Loan Parties only:
          (i) whenever any interest or fee payable by the Canadian Loan Parties
is calculated using a rate based on a year of 360 days or 365 days, as the case
may be, the rate determined pursuant to such calculation, when expressed as an
annual rate, is equivalent to (x) the applicable rate based on a year of
360 days or 365 days, as the case may be, (y) multiplied by

     
 
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the actual number of days in the calendar year in which such rate is to be
ascertained and (z) divided by 360 or 365, as the case may be; and
          (ii) all calculations of interest payable by the Canadian Loan Parties
under this Agreement or any other Loan Document are to be made on the basis of
the nominal interest rate described herein and therein and not on the basis of
effective yearly rates or on any other basis which gives effect to the principle
of deemed reinvestment of interest.
The parties hereto acknowledge that there is a material difference between the
stated nominal interest rates and the effective yearly rates of interest and
that they are capable of making the calculations required to determine such
effective yearly rates of interest.
SECTION 2.20 [INTENTIONALLY OMITTED].
SECTION 2.21 [INTENTIONALLY OMITTED].
SECTION 2.22 [INTENTIONALLY OMITTED].
SECTION 2.23 Incremental Term Loan Commitments.
     (a) Borrowers Request. The Borrowers may by written notice to the
Administrative Agent elect to request the establishment of one or more new U.S.
Term Loan Commitments and/or Canadian Term Loan Commitments (each, an
“Incremental Term Loan Commitment”) (x) in an aggregate principal amount (for
all Incremental Term Loan Commitments pursuant to this Section) not in excess of
$400 million and (y) in an aggregate principal amount of not less than
$25 million individually. Each such notice shall specify (i) the allocation of
such Incremental Term Loan Commitments between the U.S. Term Loan Commitments
and the Canadian Term Loan Commitments, (ii) the date on which the Borrowers
propose that such Incremental Term Loan Commitments shall be effective (each, an
“Increase Effective Date”), which shall be a date not less than 10 Business Days
after the date on which such notice is delivered to the Administrative Agent and
(iii) the identity of each Eligible Assignee to whom Borrowers propose any
portion of such Incremental Term Loan Commitments be allocated and the amounts
and Class of such allocations; provided that any existing Lender approached to
provide all or a portion of any Incremental Term Loan Commitments may elect or
decline, in its sole discretion, to provide such Incremental Term Loan
Commitments.
     (b) Conditions. Such Incremental Term Loan Commitments shall become
effective, as of such Increase Effective Date; provided that:
          (i) each of the conditions set forth in Section 4.02 shall be
satisfied;
          (ii) no Default shall have occurred and be continuing or would result
from the borrowings to be made on the Increase Effective Date;
          (iii) after giving pro forma effect to the borrowings to be made on
the Increase Effective Date and to any change in Consolidated EBITDA and any
increase in Indebtedness resulting from the consummation of any Permitted
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with such borrowings, the Senior Secured Leverage Ratio at such date shall be
not greater than 3.0 to 1.0; and
          (iv) the Borrowers shall deliver or cause to be delivered any legal
opinions or other documents reasonably requested by the Administrative Agent in
connection with any such transaction.
     (c) Terms of Incremental Term Loans and Commitments. The terms and
provisions of Loans made pursuant to the new Commitments shall be as follows:
          (i) terms and provisions of Loans made pursuant to Incremental Term
Loan Commitments (“Incremental Term Loans”) shall be, except as otherwise set
forth herein or in the Increase Joinder, identical to the existing Term Loans of
the same Class;
          (ii) the Weighted Average Life to Maturity of all Incremental Term
Loans shall be no shorter than the Weighted Average Life to Maturity of the
existing Term Loans of the same Class;
          (iii) the maturity date of Incremental Term Loans (the “Incremental
Term Loan Maturity Date”) shall not be earlier than the Final Maturity Date and,
in the case of any Incremental Loans that are Canadian Term Loans, the maturity
date of such Incremental Term Loans shall not be earlier than the 525 Catch-Up
Date with respect to such Loans; and
          (iv) the Applicable Margins for the Incremental Term Loans shall be
determined by Borrower and the applicable new Lenders; provided, however, that
the Net Yield for the Incremental Term Loans shall not be greater than the
highest Net Yield (excluding interest payable at the Default Rate) that may,
under any circumstances, be payable with respect to the Term Loans advanced on
the Closing Date plus 50 basis points (and the Applicable Margins applicable to
the Term Loans advanced on the Closing Date shall be increased to the extent
necessary to achieve the foregoing; and provided that to the extent the Net
Yield applicable to the Term Loans advanced on the Closing Date are so
increased, the Net Yield on the Term Loans advanced after the Closing Date but
prior to the relevant Increase Effective Date shall be increased (by increasing
the per annum rate of interest applicable to such Term Loans) such that the
difference between the Net Yield applicable to the Term Loans advanced on the
Closing Date and such Term Loans remains constant (or, if such Net Yield of both
such series of Term Loans was equal, such Net Yield remains equal)). “Net
Yield”, for purposes of any Term Loans, shall mean the sum of (1) the per annum
rate of interest applicable to such Term Loans (determined at the relevant
Increase Effective Date) plus (2) any original issue discount offered to Lenders
making such Term Loans amortized equally over the period from the date such Term
Loans were made to the applicable maturity date of such Term Loans; provided
that such original issue discount shall not be amortized over a period of
greater than three years. All determinations by the Administrative Agent as to
Net Yield or other matters contemplated by this Section 2.23 shall be conclusive
absent manifest error.
The Incremental Term Loan Commitments shall be effected by a joinder agreement
(the “Increase Joinder”) executed by the Loan Parties, the Administrative Agent
and each Lender making such Incremental Term Loan Commitment, in form and
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them. The Increase Joinder may, without the consent of any other Lenders, effect
such amendments to this Agreement and the other Loan Documents as may be
necessary or appropriate, in the opinion of the Administrative Agent, to effect
the provisions of this Section 2.23. In addition, unless otherwise specifically
provided herein, all references in Loan Documents to Term Loans shall be deemed,
unless the context otherwise requires, to include references to Term Loans made
pursuant to Incremental Term Loan Commitments made pursuant to this Agreement,
and all references in Loan Documents to Commitments of a Class shall be deemed,
unless the context otherwise requires, to include references to new Commitments
of such Class made pursuant to this Agreement (for the avoidance of doubt, it
being expressly understood and agreed that, inter alia, the provisions of
Section 2.09(b) and Section 2.10(h)(vi)(B) shall apply to any Incremental Term
Loans that are Canadian Term Loans).
     (d) Making of New Term Loans. On any Increase Effective Date on which
Incremental Term Loan Commitments are effective, subject to the satisfaction of
the foregoing terms and conditions, each Lender of such Incremental Term Loan
Commitments shall make a Term Loan to Borrower in an amount equal to its new
Commitment.
     (e) Equal and Ratable Benefit. The Loans and Commitments established
pursuant to this paragraph shall constitute Loans and Commitments under, and
shall be entitled to all the benefits afforded by, this Agreement and the other
Loan Documents, and shall, without limiting the foregoing, benefit equally and
ratably from the Guarantees and security interests created by the Security
Documents. The Loan Parties shall take any actions reasonably required by the
Administrative Agent to ensure and/or demonstrate that the Lien and security
interests granted by the Security Documents continue to be perfected under the
UCC, the PPSA or otherwise after giving effect to the establishment of any such
Incremental Term Loan Commitments or any such new Term Loans.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
     Each Loan Party represents and warrants to the Administrative Agent, the
Collateral Agent, and each of the Lenders (with references to the Companies
being references thereto after giving effect to the Transactions unless
otherwise expressly stated) that:
SECTION 3.01 Organization; Powers. Each Company (a) is duly organized or
incorporated (as applicable) and validly existing under the laws of the
jurisdiction of its organization or incorporation (as applicable), (b) has all
requisite organizational or constitutional power and authority to carry on its
business as now conducted and to own and lease its property and (c) is qualified
and in good standing (to the extent such concept is applicable in the applicable
jurisdiction) to do business in every jurisdiction where such qualification is
required, except in such jurisdictions where the failure to so qualify or be in
good standing, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 3.02 Authorization; Enforceability. The Transactions to be entered into
by each Loan Party are within such Loan Party’s organizational or constitutional
powers and

     
 
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have been duly authorized by all necessary organizational or constitutional
action on the part of such Loan Party. This Agreement has been duly executed and
delivered by each Loan Party and constitutes, and each other Loan Document to
which any Loan Party is to be a party, when executed and delivered by such Loan
Party, will constitute, a legal, valid and binding obligation of such Loan
Party, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors’ rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03 No Conflicts. The Transactions (a) do not require any consent or
approval of, registration or filing with, or any other action by, any
Governmental Authority, except (i) such as have been obtained or made and are in
full force and effect, (ii) filings necessary to perfect Liens created by the
Loan Documents (as reflected in the applicable Perfection Certificate) and
(iii) consents, approvals, registrations, filings, permits or actions the
failure to obtain or perform which could not reasonably be expected to result in
a Material Adverse Effect, (b) will not violate the Organizational Documents of
any Company, (c) will not violate any Requirement of Law, (d) will not violate
or result in a default or require any consent or approval under any indenture,
agreement or other instrument binding upon any Company or its property, or give
rise to a right thereunder to require any payment to be made by any Company,
except for violations, defaults or the creation of such rights that could not
reasonably be expected to result in a Material Adverse Effect, and (e) will not
result in the creation or imposition of any Lien on any property of any Company,
except Liens created by the Loan Documents and Permitted Liens. The execution,
delivery and performance of the Loan Documents will not violate, or result in a
default under, or require any consent or approval under, the Senior Notes, the
Senior Note Documents, or the Revolving Credit Loan Documents.
SECTION 3.04 Financial Statements; Projections.
     (a) Historical Financial Statements. Administrative Borrower has heretofore
delivered to the Lenders the consolidated balance sheets and related statements
of income, stockholders’ equity and cash flows of Canadian Borrower (i) as of
and for the fiscal years ended 2005 and 2006, audited by and accompanied by the
unqualified opinion of PricewaterhouseCoopers, independent public accountants,
and (ii) as of and for the three-month period ended March 30, 2007, and for the
comparable period of the preceding fiscal year, in each case, certified by the
chief financial officer of Canadian Borrower. Such financial statements and all
financial statements delivered pursuant to Section 5.01(a), Section 5.01(b) and
Section 5.01(c) have been prepared in accordance with GAAP and present fairly in
all material respects the financial condition and results of operations and cash
flows of Canadian Borrower as of the dates and for the periods to which they
relate.
     (b) No Liabilities. Except as set forth in the most recent financial
statements referred to in Section 3.04(a), as of the Closing Date there are no
liabilities of any Company of any kind, whether accrued, contingent, absolute,
determined, determinable or otherwise, which could reasonably be expected to
result in a Material Adverse Effect, and there is no existing condition,
situation or set of circumstances which could reasonably be expected to result
in such a liability, other than liabilities under the Loan Documents, the
Revolving Credit Loan Documents and the Senior Notes. Since December 31, 2006,
there has been no event, change, circumstance or

     
 
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occurrence that, individually or in the aggregate, has had or could reasonably
be expected to result in a Material Adverse Effect.
     (c) Pro Forma Financial Statements. Borrowers have heretofore delivered to
the Lenders in the Confidential Information Memorandum, Canadian Borrower’s
unaudited pro forma consolidated capitalization table as of March 31, 2007,
after giving effect to the Transactions as if they had occurred on such date.
Such capitalization table has been prepared in good faith by the Loan Parties,
based on the assumptions stated therein (which assumptions are believed by the
Loan Parties on the date hereof to be reasonable), are based on the best
information available to the Loan Parties as of the date of delivery thereof,
accurately reflect all adjustments required to be made to give effect to the
Transactions and present fairly in all material respects the pro forma
capitalization of Holdings as of such date assuming the Transactions had
occurred at such date, except as required to adjust for the final allocation as
between the Term Loans and the Revolving Credit Loans.
     (d) Forecasts. The forecasts of financial performance of Canadian Borrower
and its subsidiaries furnished to the Lenders have been prepared in good faith
by the Loan Parties and based on assumptions believed by the Loan Parties to
reasonable.
SECTION 3.05 Properties.
     (a) Generally. Each Company has good title to, valid leasehold interests
in, or license of, all its property material to its business, free and clear of
all Liens except for Permitted Liens. The property of the Companies, taken as a
whole, (i) is in good operating order, condition and repair in all material
respects (ordinary wear and tear excepted) and (ii) constitutes all the property
which is required for the business and operations of the Companies as presently
conducted.
     (b) Real Property. Schedules 8(a) and 8(b) to the Perfection Certificate
dated the Closing Date contain a true and complete list of each interest in Real
Property (i) owned by any Loan Party as of the date hereof having fair market
value of $1 million or more and describes the type of interest therein held by
such Loan Party and whether such owned Real Property is leased to a third party
and (ii) leased, subleased or otherwise occupied or utilized by any Loan Party,
as lessee, sublessee, franchisee or licensee, as of the date hereof having
annual rental payments of $1 million or more and describes the type of interest
therein held by such Loan Party.
     (c) No Casualty Event. No Company has as of the date hereof received any
notice of, nor has any knowledge of, the occurrence or pendency or contemplation
of any Casualty Event affecting all or any material portion of its property. No
Mortgage encumbers improved Real Property located in the United States that is
located in an area that has been identified by the Secretary of Housing and
Urban Development as an area having special flood hazards within the meaning of
the National Flood Insurance Act of 1968 unless flood insurance available under
such Act has been obtained in accordance with Section 5.04.
     (d) Collateral. Each Company owns or has rights to use all of the
Collateral used in, necessary for or material to each Company’s business as
currently conducted, except where the failure to have such ownership or rights
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Material Adverse Effect. The use by each Company of such Collateral does not
infringe on the rights of any person other than such infringement which could
not, individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect. No claim has been made and remains outstanding that any
Company’s use of any Collateral does or may violate the rights of any third
party that could, individually or in the aggregate, reasonably be expected to
result in a Material Adverse Effect.
SECTION 3.06 Intellectual Property.
     (a) Ownership/No Claims. Each Loan Party owns, or is licensed to use, all
patents, software, trademarks, mask works, inventions, designs, trade names,
service marks, copyrights, technology, trade secrets, proprietary information
and data, domain names, know-how, processes and other comparable intangible
rights necessary for the conduct of its business as currently conducted
(“Intellectual Property”), except for those the failure to own or license which,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. As of the date hereof, no material claim has been
asserted and is pending by any person, challenging or questioning the use by any
Loan Party of any such Intellectual Property or the validity or effectiveness of
any such Intellectual Property, nor does any Loan Party know of any valid basis
for any such claim. The use of any Intellectual Property by each Loan Party, and
the conduct of such Loan Party’s business as currently conducted, does not
infringe or otherwise violate the rights of any person in respect of
Intellectual Property, except for such claims and infringements that,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
     (b) Registrations. Except pursuant to non-exclusive licenses and other
non-exclusive user agreements entered into by each Loan Party in the ordinary
course of business, on and as of the date hereof (i) each Loan Party owns and
possesses the right to use, and has not authorized or enabled any other person
to use, any Intellectual Property listed on any schedule to the relevant
Perfection Certificate, or any other Intellectual Property that is material to
its business, and (ii) all registrations listed in Schedule 12(a) or 12(b) to
the Perfection Certificate are valid and in full force and effect, in each case
where the failure to do so or the absence thereof could reasonably be expected
to have a Material Adverse Effect.
     (c) No Violations or Proceedings. To each Loan Party’s knowledge, on and as
of the date hereof, (i) there is no material infringement or other violation by
others of any right of such Loan Party with respect to any Intellectual Property
listed on any schedule to the relevant Perfection Certificate, or any other
Intellectual Property that is material to its business, except as may be set
forth on Schedule 3.06(c), and (ii) no claims are pending or threatened to such
effect except as set forth on Schedule 3.06(c).
SECTION 3.07 Equity Interests and Subsidiaries.
     (a) Equity Interests. Schedules 1(a) and 10 to the Perfection Certificate
dated the Closing Date set forth a list of (i) all the Subsidiaries of Holdings
and their jurisdictions of organization as of the Closing Date and (ii) the
number of each class of its Equity Interests authorized, and the number
outstanding, on the Closing Date and the number of shares covered by all
outstanding options, warrants, rights of conversion or purchase and similar
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Closing Date. As of the Closing Date, all Equity Interests of each Company held
by Holdings or a Subsidiary thereof are duly and validly issued and are fully
paid and non-assessable, and, other than the Equity Interests of Holdings, are
owned by Holdings, directly or indirectly through Wholly Owned Subsidiaries
except as indicated on Schedules 1(a) and 10 to the Perfection Certificate. All
Equity Interests of Canadian Borrower are owned directly by Holdings. As of the
Closing Date, each Loan Party is the record and beneficial owner of, and has
good and marketable title to, the Equity Interests pledged by it under the
Security Documents, free of any and all Liens, rights or claims of other
persons, except Permitted Liens, and as of the Closing Date there are no
outstanding warrants, options or other rights to purchase, or shareholder,
voting trust or similar agreements outstanding with respect to, or property that
is convertible into, or that requires the issuance or sale of, any such Equity
Interests.
     (b) No Consent of Third Parties Required. Except as have previously been
obtained, no consent of any person including any other general or limited
partner, any other member of a limited liability company, any other shareholder
or any other trust beneficiary is necessary in connection with the creation,
perfection or First Priority status of the security interest of the Collateral
Agent in any Equity Interests pledged to the Collateral Agent for the benefit of
the Secured Parties under the Security Documents or the exercise by the
Collateral Agent of the voting or other rights provided for in the Security
Documents or the exercise of remedies in respect thereof.
     (c) Organizational Chart. An accurate organizational chart, showing the
ownership structure of Holdings, Borrowers and each Subsidiary on the Closing
Date is set forth on Schedule 10 to the Perfection Certificate dated the Closing
Date.
SECTION 3.08 Litigation; Compliance with Laws. There are no actions, suits or
proceedings at law or in equity by or before any Governmental Authority now
pending or, to the knowledge of any Company, threatened against or affecting any
Company or any business, property or rights of any Company (i) that involve any
Loan Document or (ii) as to which there is a reasonable possibility of an
adverse determination and that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect. No Company or any of its property is in violation of, nor will the
continued operation of its property as currently conducted violate, any
Requirements of Law (including any zoning or building ordinance, code or
approval or any building permits) or any restrictions of record or agreements
affecting any Company’s Real Property or is in default with respect to any
Requirement of Law, where such violation or default, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.
SECTION 3.09 Agreements. No Company is a party to any agreement or instrument or
subject to any corporate or other constitutional restriction that has resulted
or could reasonably be expected to result in a Material Adverse Effect. No
Company is in default in any manner under any provision of any indenture or
other agreement or instrument evidencing Indebtedness, or any other agreement or
instrument to which it is a party or by which it or any of its property is or
may be bound, where such default could reasonably be expected to result in a
Material Adverse Effect. There is no existing default under any Organizational
Document of any Company or any event which, with the giving of notice or passage
of time or both, would constitute a default by any party thereunder that in each
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have an adverse effect on the Agents or the Lenders or their respective rights
and benefits hereunder.
SECTION 3.10 Federal Reserve Regulations. No Company is engaged principally, or
as one of its important activities, in the business of extending credit for the
purpose of buying or carrying Margin Stock. No part of the proceeds of any Loan
will be used, whether directly or indirectly, and whether immediately,
incidentally or ultimately, for any purpose that entails a violation of, or that
is inconsistent with, the provisions of the regulations of the Board, including
Regulation T, U or X. The pledge of the Securities Collateral pursuant to the
Security Documents does not violate such regulations.
SECTION 3.11 Investment Company Act. No Company is an “investment company” or a
company “controlled” by an “investment company,” as defined in, or subject to
regulation under, the Investment Company Act of 1940, as amended.
SECTION 3.12 Use of Proceeds. Borrowers will use the proceeds of (a) the Loans
on the Closing Date for the Refinancing and for payment of fees, premiums and
expenses in connection with the Transactions and (b) any Incremental Term Loans
after the Closing Date for general corporate purposes (including to effect
Permitted Acquisitions); provided that in no event shall any proceeds of any
Loans (including any Incremental Term Loans) be remitted, directly or
indirectly, to any Swiss tax resident Company or Swiss tax resident permanent
establishment, where this remittance could be viewed as a use of such proceeds
in Switzerland (whether through an intercompany loan or advance by any other
Company or otherwise) as per the practice of the Swiss Federal Tax
Administration, unless the Swiss Federal Tax Administration confirms in a
written advance tax ruling (based on a fair description of the fact pattern in
the tax ruling request made by a Loan Party) that such use of proceeds in
Switzerland does not lead to Swiss Withholding Tax becoming due on or in respect
any Loans (including any Incremental Term Loans) or parts thereof.
SECTION 3.13 Taxes. Each Company has (a) timely filed or caused to be timely
filed all material Tax Returns required to have been filed by it and (b) duly
and timely paid, collected or remitted or caused to be duly and timely paid,
collected or remitted all material Taxes due and payable, collectible or
remittable by it and all assessments received by it, except Taxes (i) that are
being contested in good faith by appropriate proceedings and for which such
Company has set aside on its books adequate reserves in accordance with GAAP or
other applicable accounting rules and (ii) which could not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect. Each
Company has made adequate provision in accordance with GAAP or other applicable
accounting rules for all material Taxes not yet due and payable. Each Company is
unaware of any proposed or pending tax assessments, deficiencies or audits that
could be reasonably expected to, individually or in the aggregate, result in a
Material Adverse Effect. No Company has ever been a party to any understanding
or arrangement constituting a “tax shelter” within the meaning of
Section 6111(c), Section 6111(d) or Section 6662(d)(2)(C)(iii) of the Code, or
has ever “participated” in a “reportable transaction” within the meaning of
Treasury Regulation Section 1.6011-4, except as could not be reasonably expected
to, individually or in the aggregate, result in a Material Adverse Effect.

     
 
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SECTION 3.14 No Material Misstatements. The written information (including the
Confidential Information Memorandum), reports, financial statements,
certificates, exhibits or schedules furnished by or on behalf of any Company to
any Agent or any Lender in connection with the negotiation of any Loan Document
or included therein or delivered pursuant thereto, taken as a whole, did not and
does not contain any material misstatement of fact and, taken as a whole, did
not and does not omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were or
are made, not materially misleading in their presentation of Holdings and its
Subsidiaries taken as a whole as of the date such information is dated or
certified; provided that to the extent any such information, report, financial
statement, exhibit or schedule was based upon or constitutes a forecast or
projection, each Loan Party represents only that it was prepared in good faith
and based on assumptions believed by the applicable Loan Parties to be
reasonable.
SECTION 3.15 Labor Matters. As of the Closing Date, there are no strikes,
lockouts or labor slowdowns against any Company pending or, to the knowledge of
any Company, threatened. The hours worked by and payments made to employees of
any Company have not been in violation of the Fair Labor Standards Act of 1938,
as amended, or any other applicable federal, state, provincial, local or foreign
law dealing with such matters in any manner which could reasonably be expected
to result in a Material Adverse Effect. All payments due from any Company, or
for which any claim may be made against any Company, on account of wages and
employee health and welfare insurance and other benefits, have been paid or
accrued as a liability on the books of such Company except where the failure to
do so could not reasonably be expected to result in a Material Adverse Effect.
The consummation of the Hindalco Acquisition did not and will not, and
consummation of the Transactions will not, give rise to any right of termination
or right of renegotiation on the part of any union under any collective
bargaining agreement to which any Company is bound, except as could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 3.16 Solvency. At the time of and immediately after the consummation of
the Transactions to occur on the Closing Date, and at the time of and
immediately following the making of the initial Credit Extension under any
Incremental Term Loan Commitments and after giving effect to the application of
the proceeds of each Loan and the operation of the Contribution, Intercompany,
Contracting and Offset Agreement, (a) the fair value of the assets of each Loan
Party (individually and on a consolidated basis with its Subsidiaries) will
exceed its debts and liabilities, subordinated, contingent, prospective or
otherwise; (b) the present fair saleable value of the property of each Loan
Party (individually and on a consolidated basis with its Subsidiaries) will be
greater than the amount that will be required to pay the probable liability of
its debts and other liabilities, subordinated, contingent, prospective or
otherwise, as such debts and other liabilities become absolute and matured;
(c) each Loan Party (individually and on a consolidated basis with its
Subsidiaries) will be able to pay its debts and liabilities, subordinated,
contingent, prospective or otherwise, as such debts and liabilities become
absolute and matured; (d) each Loan Party (individually and on a consolidated
basis with its Subsidiaries) will not have unreasonably small capital with which
to conduct its business in which it is engaged as such business is now conducted
and is proposed to be conducted following the Closing Date; and (e) each Loan
Party is not “insolvent” as such term is defined under any bankruptcy,
insolvency or similar laws of any jurisdiction in which any Loan Party is
organized or incorporated (as applicable), or otherwise unable to pay its debts
as they fall due.

     
 
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SECTION 3.17 Employee Benefit Plans. Each Company and its ERISA Affiliates is in
compliance in all material respects with the applicable provisions of ERISA and
the Code and the regulations and published interpretations thereunder except for
such non-compliance that in the aggregate would not have a Material Adverse
Effect. No ERISA Event has occurred or is reasonably expected to occur that,
when taken together with all other such ERISA Events, could reasonably be
expected to result in a Material Adverse Effect or the imposition of a Lien on
any of the property of any Company. The present value of all accumulated benefit
obligations of all underfunded Plans (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed the fair
market value of the property of all such underfunded Plans in an amount which
could reasonably be expected to have a Material Adverse Effect. Using actuarial
assumptions and computation methods consistent with subpart I of subtitle E of
Title IV of ERISA, the aggregate liabilities of each Company or its ERISA
Affiliates to all Multiemployer Plans in the event of a complete withdrawal
therefrom, as of the close of the most recent fiscal year of each such
Multiemployer Plan, could not reasonably be expected to result in a Material
Adverse Effect.
          To the extent applicable, each Foreign Plan has been maintained in
compliance with its terms and with the requirements of any and all applicable
Requirements of Law and has been maintained, where required, in good standing
with applicable Governmental Authority and Taxing Authority, except for such
non-compliance that in the aggregate would not have a Material Adverse Effect.
No Company has incurred any obligation in connection with the termination of or
withdrawal from any Foreign Plan, except to the extent of liabilities which
could not reasonably be expected to have a Material Adverse Effect. The present
value of the accrued benefit liabilities (whether or not vested) under each
Foreign Plan which is funded, determined as of the end of the most recently
ended fiscal year of the respective Company on the basis of actuarial
assumptions, each of which is reasonable, did not exceed the current value of
the property of such Foreign Plan, and for each Foreign Plan which is not
funded, the obligations of such Foreign Plan are properly accrued in the
financial statements of Canadian Borrower and its Subsidiaries, in each case in
an amount that could not reasonably be expected to have a Material Adverse
Effect.
          Except as specified on Schedule 3.17, (i) no Company is or has at any
time been an employer (for the purposes of Sections 38 to 51 of the Pensions Act
2004) of an occupational pension scheme which is not a money purchase scheme
(both terms as defined in the Pensions Schemes Act 1993), and (ii) no Company is
or has at any time been “connected” with or an “associate” of (as those terms
are used in Sections 39 and 43 of the Pensions Act 2004) such an employer.
SECTION 3.18 Environmental Matters.
     (a) Except as, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect:
               (i) The Companies and their businesses, operations and Real
Property are in compliance with, and the Companies have no liability under, any
applicable Environmental Law;

     
 
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               (ii) The Companies have obtained all Environmental Permits
required for the conduct of their businesses and operations, and the ownership,
operation and use of their property, under Environmental Law, all such
Environmental Permits are valid and in good standing;
               (iii) There has been no Release or threatened Release of
Hazardous Material on, at, under or from any Real Property or facility presently
or formerly owned, leased or operated by the Companies or their predecessors in
interest that could reasonably be expected to result in liability of the
Companies under any applicable Environmental Law;
               (iv) There is no Environmental Claim pending or, to the knowledge
of the Companies, threatened against the Companies, or relating to the Real
Property currently or formerly owned, leased or operated by the Companies or
their predecessors in interest or relating to the operations of the Companies,
and, to the best knowledge of the Loan Parties after due inquiry, there are no
actions, activities, circumstances, conditions, events or incidents that could
reasonably be expected to form the basis of such an Environmental Claim;
               (v) No Lien has been recorded or, to the knowledge of any
Company, threatened under any Environmental Law with respect to any Real
Property or other assets of the Companies;
               (vi) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby will not require
any notification, registration, filing, reporting, disclosure, investigation,
remediation or cleanup pursuant to any Governmental Real Property Disclosure
Requirements or any other applicable Environmental Law; and
               (vii) No person with an indemnity or contribution obligation to
the Companies relating to compliance with or liability under Environmental Law
is in default with respect to such obligation.
     (b) As of the Closing Date:
               (i) Except as could not reasonably be expected to have a Material
Adverse Effect, no Company is obligated to perform any action or otherwise incur
any expense under Environmental Law pursuant to any order, decree, judgment or
agreement by which it is bound or has assumed by contract, agreement or
operation of law, and no Company is conducting or financing any Response
pursuant to any Environmental Law with respect to any Real Property or any other
location; and
               (ii) No Real Property or facility owned, operated or leased by
the Companies and, to the knowledge of the Companies, no Real Property or
facility formerly owned, operated or leased by the Companies or any of their
predecessors in interest is (i) listed or proposed for listing on the National
Priorities List promulgated pursuant to CERCLA or (ii) listed on the
Comprehensive Environmental Response, Compensation and Liability Information
System promulgated pursuant to CERCLA or (iii) included on any similar publicly
available list maintained by any Governmental Authority including any such list
relating to petroleum.

     
 
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SECTION 3.19 Insurance. Schedule 3.19 sets forth a true and correct description
of all insurance policies maintained by each Company as of the Closing Date. All
insurance maintained by the Companies and required by Section 5.04 is in full
force and effect, and all premiums thereon have been duly paid. As of the
Closing Date, no Company has received notice of violation or cancellation
thereof, the Mortgaged Property, and the use, occupancy and operation thereof,
comply in all material respects with all Insurance Requirements, and there
exists no material default under any Insurance Requirement. Each Company has
insurance in such amounts and covering such risks and liabilities as are
customary for companies of a similar size engaged in similar businesses in
similar locations.
SECTION 3.20 Security Documents.
     (a) U.S. Security Agreement. The U.S. Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of the Secured Parties,
legal, valid and enforceable Liens on, and security interests in, the Security
Agreement Collateral referred to therein and, when (i) financing statements and
other filings in appropriate form are filed in the offices specified on
Schedule 7 to the relevant Perfection Certificate as in effect on the Closing
Date and (ii) upon the taking of possession or control by the Collateral Agent
of the Security Agreement Collateral with respect to which a security interest
may be perfected only by possession or control (which possession or control
shall be given to the Collateral Agent to the extent possession or control by
the Collateral Agent is required by each Security Agreement), the Liens created
by the Security Agreement shall constitute valid, perfected First Priority Liens
on, and security interests in, all right, title and interest of the grantors
thereunder in the Security Agreement Collateral (other than such Security
Agreement Collateral in which a security interest cannot be perfected under the
UCC as in effect at the relevant time in the relevant jurisdiction), in each
case subject to no Liens other than Permitted Liens.
     (b) Canadian Security Agreement. Each of the Canadian Security Agreements
is effective to create in favor of the Collateral Agent for the benefit of the
Secured Parties, legal, valid and enforceable Liens on, and security interests
in, the Security Agreement Collateral referred to therein and, when PPSA
financing statements and other filings in appropriate form are filed in the
offices specified on Schedule 7 to the relevant Perfection Certificate as in
effect on the Closing Date, the Liens created by such Canadian Security
Agreement shall constitute valid, perfected First Priority Liens on, and
security interests in, all right, title and interest of the grantors thereunder
in the Security Agreement Collateral referred to therein (other than such
Security Agreement Collateral in which a security interest cannot be perfected
under the PPSA as in effect at the relevant time in the relevant jurisdiction),
in each case subject to no Liens other than Permitted Liens.
     (c) U.K. Security Agreement. The U.K. Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of the Secured Parties,
legal, valid and enforceable Liens on, and security interests in, the Security
Agreement Collateral referred to therein and, upon the registration specified on
Schedule 7 to the relevant Perfection Certificate as in effect on the Closing
Date, the Liens created by the U.K. Security Agreement shall constitute valid,
perfected First Priority Liens on, and security interests in, all right, title
and interest of the grantors thereunder in the Security Agreement Collateral
referred to therein (other than such Security Agreement Collateral in which a
security interest cannot be perfected under applicable

     
 
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law as in effect at the relevant time in the relevant jurisdiction), in each
case subject to no Liens other than Permitted Liens.
     (d) Swiss Security Agreement. The Swiss Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of the Secured Parties,
legal, valid and enforceable Liens on, and security interests in, the Security
Agreement Collateral referred to therein and, upon the registrations, recordings
and other actions specified on Schedule 7 to the relevant Perfection Certificate
as in effect on the Closing Date, the Liens created by the Swiss Security
Agreement shall constitute valid, perfected First Priority Liens on, and
security interests in, all right, title and interest of the grantors thereunder
in the Security Agreement Collateral referred to therein (other than such
Security Agreement Collateral in which a security interest cannot be perfected
under applicable law as in effect at the relevant time in the relevant
jurisdiction), in each case subject to no Liens other than Permitted Liens.
     (e) German Security Agreement. The German Security Agreement is effective
to create in favor of the Collateral Agent for the benefit of the Secured
Parties, or in the case of accessory security, in favor of the Secured Parties,
legal, valid and enforceable Liens on, and security interests in, the Security
Agreement Collateral referred to therein and, upon the registrations, recordings
and other actions specified on Schedule 7 to the relevant Perfection Certificate
as in effect on the Closing Date, the Liens created by the German Security
Agreement shall constitute valid, perfected First Priority Liens on, and
security interests in, all right, title and interest of the grantors thereunder
in the Security Agreement Collateral referred to therein (other than such
Security Agreement Collateral in which a security interest cannot be perfected
under applicable law as in effect at the relevant time in the relevant
jurisdiction), in each case subject to no Liens other than Permitted Liens.
     (f) Irish Security Agreement. The Irish Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of and as trustee for
the Secured Parties, legal, valid and enforceable Liens on, and security
interests in, the Security Agreement Collateral referred to therein and, upon
the registrations, recordings and other actions specified on Schedule 7 to the
relevant Perfection Certificate as in effect on the Closing Date, the Liens
created by the Irish Security Agreement shall constitute valid, perfected First
Priority Liens on, and security interests in, all right, title and interest of
the grantors thereunder in the Security Agreement Collateral referred to therein
(other than such Security Agreement Collateral in which a security interest
cannot be perfected under applicable law as in effect at the relevant time in
the relevant jurisdiction), in each case subject to no Liens other than
Permitted Liens.
     (g) Brazilian Security Agreement. Each Brazilian Security Agreement is
effective to create in favor of the Collateral Agent for the benefit of the
Secured Parties, legal, valid and enforceable Liens on, and security interests
in, the Security Agreement Collateral referred to therein and, upon the
registrations, recordings and other actions specified on Schedule 7 to the
relevant Perfection Certificate as in effect on the Closing Date, the Liens
created by each of the Brazilian Security Agreement shall constitute valid,
perfected First Priority Liens on, and security interests in, all right, title
and interest of the grantors thereunder in the Security Agreement Collateral
referred to therein (other than such Security Agreement Collateral in which a
security interest cannot be perfected under applicable law as in effect at the
relevant time in the relevant jurisdiction), in each case subject to no Liens
other than Permitted Liens.

     
 
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     (h) Intellectual Property Filings. When the (i) financing statements and
other filings in appropriate form referred to on Schedule 7 to the relevant
Perfection Certificate have been made, and (ii) U.S. Security Agreement or a
short form thereof is filed in the United States Patent and Trademark Office and
the United States Copyright Office, the Liens created by such Security Agreement
shall constitute valid, perfected First Priority Liens on, and security
interests in, all right, title and interest of the grantors thereunder in
Patents and Trademarks (each as defined in such Security Agreement) that are
registered or applied for by any Loan Party with the United States Patent and
Trademark Office or Copyrights (as defined in such Security Agreement)
registered or applied for by any Loan Party with the United States Copyright
Office, as the case may be, in each case subject to no Liens other than
Permitted Liens.
     (i) Mortgages. Each Mortgage (other than a Mortgage granted by a U.K.
Guarantor) is effective to create, in favor of the Collateral Agent, for its
benefit and the benefit of the Secured Parties, legal, valid, perfected and
enforceable First Priority Liens on, and security interests in, all of the Loan
Parties’ right, title and interest in and to the Mortgaged Properties thereunder
and the proceeds thereof, subject only to Permitted Liens, and when such
Mortgages are filed in the offices specified on Schedule 8(a) to the applicable
Perfection Certificates dated the Closing Date (or, in the case of any Mortgage
executed and delivered after the date thereof in accordance with the provisions
of Sections 5.11 and 5.12, when such Mortgage is filed in the offices specified
in the local counsel opinion delivered with respect thereto in accordance with
the provisions of Sections 5.11 and 5.12), the Mortgages shall constitute First
Priority fully perfected Liens on, and security interests in, all right, title
and interest of the Loan Parties in the Mortgaged Properties and the proceeds
thereof, in each case prior and superior in right to any other person, other
than Permitted Liens.
     The Mortgages granted by each applicable U.K. Guarantor under the relevant
U.K. Security Agreement are effective to create in favor of the Collateral
Agent, for the ratable benefit of the Secured Parties, legal, valid and
enforceable Liens on all of each such Loan Party’s right, title and interest in
and to the Mortgaged Property thereunder and the proceeds thereof, and when the
Mortgages are filed with the Land Registry, the Mortgages shall constitute fully
perfected First Priority Liens on, and security interest in, all right, title
and interest of the U.K. Borrower and each applicable U.K. Guarantor in such
Mortgaged Property and the proceeds thereof, in each case prior and superior in
right to any other Person, other than with respect to the rights of Persons
pursuant to Permitted Liens.
     (j) Valid Liens. Each Security Document delivered pursuant to Sections 5.11
and 5.12 will, upon execution and delivery thereof, be effective to create in
favor of the Collateral Agent, for the benefit of the Secured Parties, legal,
valid and enforceable Liens on, and security interests in, all of the Loan
Parties’ right, title and interest in and to the Collateral thereunder, and
(i) when all appropriate filings, registrations or recordings and other actions
set forth in the relevant Perfection Certificate are made in the appropriate
offices as may be required under applicable law and (ii) upon the taking of
possession or control by the Collateral Agent of such Collateral with respect to
which a security interest may be perfected only by possession or control (which
possession or control shall be given to the Collateral Agent to the extent
required by any Security Document), such Security Document will constitute First
Priority fully perfected Liens on, and security interests in, all right, title
and interest of the Loan Parties in such Collateral, in each case subject to no
Liens other than the applicable Permitted Liens.

     
 
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     (k) Receivables Purchase Agreement. The Receivables Purchase Agreement is
in full force and effect. Each representation and warranty under the Receivables
Purchase Agreement of each Loan Party party thereto is true and correct on and
as of the date made thereunder. No “Termination Event” (as defined therein) has
occurred under the Receivables Purchase Agreement.
SECTION 3.21 Acquisition Documents; Material Indebtedness Documents;
Representations and Warranties in Acquisition Agreement. Schedule 3.21 lists, as
of the Closing Date, (i) the Acquisition Agreement and each material agreement,
certificate, instrument, letter or other document delivered pursuant to the
Acquisition Agreement or otherwise entered into, executed or delivered by any
Loan Party or Acquiror in connection with the Hindalco Acquisition (each, an
“Acquisition Document”), (ii) each material Senior Note Document, (iii) each
material Revolving Credit Loan Document, (iv) each material agreement,
certificate, instrument, letter or other document delivered pursuant to the
Subordinated Debt Loan, and (v) each material agreement, certificate,
instrument, letter or other document evidencing any other Material Indebtedness,
and the Lenders have been furnished true and complete copies of each of the
foregoing. All representations and warranties of each Company set forth in the
Acquisition Agreement were true and correct in all material respects as of the
time such representations and warranties were made and no default has occurred
under the Acquisition Agreement.
SECTION 3.22 Anti-Terrorism Law. No Loan Party and, to the knowledge of the Loan
Parties, none of its Affiliates is in violation of any Requirement of Law
relating to terrorism or money laundering (“Anti-Terrorism Laws”), including
Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001
(the “Executive Order”), and the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001,
Public Law 107-56.
          No Loan Party and to the knowledge of the Loan Parties, no Affiliate
or broker or other agent of any Loan Party acting or benefiting in any capacity
in connection with the Loans is any of the following:
               (i) a person that is listed in the annex to, or is otherwise
subject to the provisions of, the Executive Order;
               (ii) a person owned or controlled by, or acting for or on behalf
of, any person that is listed in the annex to, or is otherwise subject to the
provisions of, the Executive Order;
               (iii) a person with which any Lender is prohibited from dealing
or otherwise engaging in any transaction by any Anti-Terrorism Law;
               (iv) a person that commits, threatens or conspires to commit or
supports “terrorism” as defined in the Executive Order; or
               (v) a person that is named as a “specially designated national
and blocked person” on the most current list published by the U.S. Treasury
Department Office of Foreign Assets Control (“OFAC”) at its official website or
any replacement website or other replacement official publication of such list.

     
 
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          No Loan Party and, to the knowledge of the Loan Parties, no broker or
other agent of any Loan Party acting in any capacity in connection with the
Loans (x) conducts any business or engages in making or receiving any
contribution of funds, goods or services to or for the benefit of any person
described in clauses (i) through (v) above, (y) deals in, or otherwise engages
in any transaction relating to, any property or interests in property blocked
pursuant to the Executive Order, or (z) engages in or conspires to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding, or
attempts to violate, any of the prohibitions set forth in any Anti-Terrorism
Law.
SECTION 3.23 [INTENTIONALLY OMITTED].
SECTION 3.24 Location of Material Inventory and Equipment. Schedule 3.24 sets
forth as of the Closing Date all locations where the aggregate value of
Inventory and Equipment (other than mobile Equipment or Inventory in transit)
owned by the Loan Parties exceeds $1 million.
SECTION 3.25 [INTENTIONALLY OMITTED].
SECTION 3.26 Senior Notes; Material Indebtedness. The Obligations constitute
“Senior Debt” or “Designated Senior Indebtedness” (or any other defined term
having a similar purpose) within the meaning of the Senior Note Documents (and
any Permitted Refinancings thereof permitted under Section 6.01 other than
refinancings with Incremental Term Loans). The Commitments and the Loans and
other extensions of credit under the Loan Documents constitute “Credit
Facilities” (or any other defined term having a similar purpose) or liabilities
payable under the documentation related to “Credit Facilities” (or any other
defined term having a similar purpose), in each case, within the meaning of the
Senior Note Documents (and any Permitted Refinancings thereof permitted under
Section 6.01 other than refinancings with Incremental Term Loans). The
consummation of each of (i) the Hindalco Acquisition, (ii) the Transactions,
(iii) each incurrence of Indebtedness hereunder and (iv) the granting of the
Liens provided for under the Security Documents to secure the Secured
Obligations is permitted under, and, in each case, does not require any consent
or approval under, the terms of (A) the Senior Note Documents (and any Permitted
Refinancings thereof), the Revolving Credit Loan Documents (and any Permitted
Revolving Credit Facility Refinancings thereof) or any other Material
Indebtedness or (B) any other material agreement or instrument binding upon any
Company or any of its property except, in the case of this clause (B), as could
not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.27 Centre of Main Interests and Establishments. For the purposes of
The Council of the European Union Regulation No. 1346/2000 on Insolvency
Proceedings (the “Regulation”), (i) the centre of main interest (as that term is
used in Article 3(1) of the Regulation) of each U.K. Guarantor is situated in
England and Wales, (ii) the centre of main interest of each Irish Guarantor is
situated in Ireland, and in each case each has no “establishment” (as that term
is used in Article 2(h) of the Regulation) in any other jurisdiction and
(iii) the centre of main interest of each Swiss Guarantor is situated in
Switzerland, and in each case each has no “establishment” (as that term is used
in Article 2(h) of the Regulation) in any other jurisdiction, and (iv) the
centre of main interest of German Seller is situated in Germany.

     
 
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SECTION 3.28 Holding and Dormant Companies. Except as may arise under the Loan
Documents, the Revolving Credit Loan Documents or (in the case of Novelis Europe
Holdings Limited) the Senior Notes, neither Holdings nor Novelis Europe Holdings
Limited trades or has any liabilities or commitments (actual or contingent,
present or future) other than liabilities attributable or incidental to acting
as a holding company of shares in the Equity Interests of its Subsidiaries.
SECTION 3.29 Hindalco Acquisition. The Hindalco Acquisition was consummated on
the Acquisition Closing Date in all material respects in accordance with the
terms and conditions of the Acquisition Agreement, without the waiver or
amendment of any such terms or conditions not approved by the Administrative
Agent and the Arrangers other than any waiver or amendment thereof that was not
materially adverse to the interests of the Lenders.
SECTION 3.30 Excluded Collateral Subsidiaries. The Excluded Collateral
Subsidiaries as of the Closing Date are listed on Schedule 1.01(c).
SECTION 3.31 Immaterial Subsidiaries. The Immaterial Subsidiaries as of the
Closing Date are listed on Schedule 1.01(d).
ARTICLE IV.
CONDITIONS TO CREDIT EXTENSIONS
SECTION 4.01 Conditions to Initial Credit Extension. The obligation of each
Lender to fund the initial Credit Extension requested to be made by it shall be
subject to the prior or concurrent satisfaction of each of the conditions
precedent set forth in this Section 4.01.
     (a) Loan Documents. The Administrative Agent shall have received executed
counterparts of each of the following, properly executed by a Responsible
Officer of each applicable signing Loan Party, each in form and substance
reasonably satisfactory to the Administrative Agent and its legal counsel:
          (i) this Agreement,
          (ii) each Foreign Guaranty;
          (iii) the Intercreditor Agreement;
          (iv) the Contribution, Intercompany, Contracting and Offset Agreement;
          (v) the Receivables Purchase Agreement;
          (vi) a Note executed by each applicable Borrower in favor of each
Lender that has requested a Note prior to the Closing Date;
          (vii) the U.S. Security Agreement, each Canadian Security Agreement,
each U.K. Security Agreement, each Swiss Security Agreement, each German
Security Agreement,

     
 
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each Irish Security Agreement, each Brazilian Security Agreement and each other
Security Document requested by the Administrative Agent prior to the Closing
Date; and
          (viii) the Perfection Certificates.
     (b) Corporate Documents. The Administrative Agent shall have received:
          (i) a certificate of the secretary, assistant secretary or managing
director (where applicable) of each Loan Party dated the Closing Date,
certifying (A) that attached thereto is a true and complete copy of each
Organizational Document (or its equivalent including the constitutional
documents) of such Loan Party certified (to the extent customary in the
applicable state) as of a recent date by the Secretary of State (or equivalent
Governmental Authority) of the jurisdiction of its organization, (B) that
attached thereto is a true and complete copy of resolutions duly adopted by the
Board of Directors and/or shareholders, as applicable, of such Loan Party
authorizing the execution, delivery and performance of the Loan Documents to
which such person is a party and, in the case of Borrowers, the borrowings
hereunder, and that such resolutions, or any other document attached thereto,
have not been modified, rescinded, amended or superseded and are in full force
and effect, (C) as to the incumbency and specimen signature of each officer
executing any Loan Document or any other document delivered in connection
herewith on behalf of such Loan Party (together with a certificate of another
officer as to the incumbency and specimen signature of the secretary, assistant
secretary or managing director executing the certificate in this clause (i), and
other customary evidence of incumbency) and (D) that the borrowing, guarantee,
or granting of Liens with respect to the Loans or any of the other Secured
Obligations would not cause any borrowing, guarantee, security or similar limit
binding on any Loan Party to be exceeded;
          (ii) a certificate as to the good standing (where applicable, or such
other customary functionally equivalent certificates or abstracts) of each Loan
Party (in so-called “long-form” if available) as of a recent date, from such
Secretary of State (or other applicable Governmental Authority);
          (iii) evidence that the records of the applicable Loan Parties at the
United Kingdom Companies House and each other relevant registrar of companies
(or equivalent Governmental Authority) in the respective jurisdictions of
organization of the Loan Parties are accurate, complete and up to date and that
the latest relevant accounts have been duly filed, where applicable;
          (iv) if relevant, evidence that each Irish Guarantor has done all that
is necessary to follow the procedures set out in Sub-Sections (2) and (11) of
section 60 of the Companies Act 1963 of Ireland in order to enable it to enter
into the Loan Documents;
          (v) a copy of the constitutional documents of any Person incorporated
in Ireland whose shares are subject to security under any Security Document,
together with any resolutions of the shareholders of such Person adopting such
changes to the constitutional documents of that Person to remove any restriction
on any transfer of shares or partnership interests (or equivalent) in such
Person pursuant to any enforcement of any such Security Document;

     
 
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          (vi) evidence that each of the Loan Parties are members of the same
group of companies consisting of a holding company and its subsidiaries for the
purposes of Section 155 of the Companies Act 1963 of Ireland and Section 35 of
the Companies Act 1990 of Ireland; and
          (vii) such other documents as the Lenders or the Administrative Agent
may reasonably request.
     (c) Officers’ Certificate. The Administrative Agent shall have received a
certificate, dated the Closing Date and signed by a Responsible Officer of
Canadian Borrower, certifying (i) compliance with the conditions precedent set
forth in this Section 4.01 and Section 4.02(b) and (c), (ii) as to the absence
of any Acquisition Material Adverse Effect from September 30, 2006, through the
Acquisition Closing Date, (iii) that the representations and warranties of each
Company set forth in the Acquisition Agreement shall have been true and correct
(without giving effect to any materiality qualifiers set forth therein) as of
the Acquisition Closing Date as if made on and as of such date (except (a) to
the extent such representations and warranties speak solely as of an earlier
date, in which event such representations and warranties shall be true and
correct to such extent as of such earlier date, (b) other than in the case of
the representations and warranties specifically referred to in clause (c) below,
to the extent that facts or matters as to which such representations and
warranties are not so true and correct as of such dates, individually or in the
aggregate, have not had and would not have a Acquisition Material Adverse
Effect, and (c) in the case of the representations and warranties set forth in
Section 3.03 of the Acquisition Agreement such representations and warranties
shall have been true and correct in all material respects), (iv) that each of
the representations and warranties made by any Loan Party set forth in ARTICLE
III hereof or in any other Loan Document were true and correct in all material
respects on and as of the Closing Date, except to the extent such
representations and warranties expressly related to an earlier date, in which
case such representation and warranty shall have been true and correct in all
material respects as of such earlier date.
     (d) Financings and Other Transactions, etc.
          (i) (A) The Hindalco Acquisition shall have been consummated in all
material respects in accordance with the terms of the Acquisition Agreement,
without the waiver or amendment of any such terms not approved by the
Administrative Agent and the Arrangers other than any waiver or amendment
thereof that is not materially adverse to the interests of the Lenders and
(B) the Transactions shall have been consummated or shall be consummated
simultaneously on the Closing Date, in each case in all material respects in
accordance with the terms hereof and the terms of the Transaction Documents,
without the waiver or amendment of any such terms not approved by the
Administrative Agent and the Arrangers other than any waiver or amendment
thereof that is not materially adverse to the interests of the Lenders..
          (ii) The Loan Parties that are borrowers under the Revolving Credit
Agreement shall have contemporaneously received an aggregate amount equal to the
Dollar Equivalent of approximately $550 million in gross proceeds from
borrowings under the Revolving Credit Agreement.

     
 
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          (iii) The Refinancing shall be consummated contemporaneously with the
transactions contemplated hereby in full to the satisfaction of the Lenders with
all Liens in favor of the existing lenders being unconditionally released; the
Administrative Agent shall have received a “pay-off” letter in form and
substance reasonably satisfactory to the Administrative Agent with respect to
all debt being refinanced in the Refinancing; and the Administrative Agent shall
have received from any person holding any Lien securing any such debt, such UCC
termination statements, mortgage releases, releases of assignments of leases and
rents, releases of security interests in Intellectual Property and other
instruments, in each case in proper form for recording, as the Administrative
Agent shall have reasonably requested to release and terminate of record the
Liens securing such debt.
     (e) Financial Statements; Pro Forma Balance Sheet; Projections. The
Administrative Agent shall have received the financial statements described in
Section 3.04(a) and the pro forma capitalization table described in
Section 3.04(c), together with forecasts of the financial performance of the
Companies.
     (f) Indebtedness and Minority Interests. After giving effect to the
Transactions and the other transactions contemplated hereby, no Company shall
have outstanding any Indebtedness or preferred stock other than (i) the Loans
hereunder, (ii) the Revolving Credit Loans and other extensions of credit under
the Revolving Credit Agreement, (iii) the Senior Notes, (iv) the Subordinated
Debt Loan, (v) the Indebtedness listed on Schedule 6.01(b), (vi) Indebtedness
owed to, and preferred stock held by, any Borrower or any Guarantor to the
extent permitted hereunder and (vii) other Indebtedness permitted under
Section 6.01.
     (g) Opinions of Counsel. The Administrative Agent shall have received, on
behalf of itself, the other Agents, the Arrangers, the Lenders, (i) a favorable
written opinion of Torys LLP, special counsel for the Loan Parties, (ii) a
favorable written opinion of each local and foreign counsel of the Loan Parties
listed on Schedule 4.01(g), in each case (A) dated the Closing Date,
(B) addressed to the Agents and the Lenders and (C) covering the matters set
forth in Exhibit N and such other matters relating to the Loan Documents and the
Transactions as the Administrative Agent shall reasonably request, and (iii) a
copy of each legal opinion (if any) delivered in connection with the Hindalco
Acquisition.
     (h) Solvency Certificate. The Administrative Agent shall have received a
solvency certificate in the form of Exhibit O (or in such other form as is
satisfactory to the Administrative Agent to reflect applicable legal
requirements), dated the Closing Date and signed by a senior Financial Officer
of each Loan Party or of Canadian Borrower.
     (i) Requirements of Law. The Administrative Agent shall be satisfied that
Holdings, its Subsidiaries and the Transactions shall be in full compliance with
all material Requirements of Law, including Regulations T, U and X of the Board,
and shall have received satisfactory evidence of such compliance reasonably
requested by them.
     (j) Consents. All approvals of Governmental Authorities and third parties
(i) required to be obtained under the Hindalco Acquisition Agreement or
(ii) necessary to consummate the Transactions shall been obtained and shall be
in full force and effect.

     
 
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     (k) Litigation. There shall be no governmental or judicial action, actual
or threatened, that has or would have, singly or in the aggregate, a reasonable
likelihood of restraining, preventing or imposing burdensome conditions on the
Transactions or the Hindalco Acquisition.
     (l) Sources and Uses. The sources and uses of the Loans shall be as set
forth in Schedule 4.01(l).
     (m) Fees. The Arrangers and Administrative Agent shall have received all
Fees and other amounts due and payable on or prior to the Closing Date,
including, to the extent invoiced, reimbursement or payment of all reasonable
out-of-pocket expenses (including the reasonable legal fees and expenses of
Skadden, Arps, Slate, Meagher & Flom LLP, special counsel to the Agents, and the
reasonable fees and expenses of any local counsel, foreign counsel, appraisers,
consultants and other advisors) required to be reimbursed or paid by any Loan
Party hereunder or under any other Loan Document.
     (n) Personal Property Requirements. The Collateral Agent shall have
received:
          (i) subject to the terms of the Intercreditor Agreement, all
certificates, agreements or instruments, if any, representing or evidencing the
Securities Collateral accompanied by instruments of transfer and stock powers
undated and endorsed in blank;
          (ii) subject to the terms of the Intercreditor Agreement, the
Intercompany Note executed by and among Canadian Borrower and each of its
Subsidiaries, accompanied by instruments of transfer undated and endorsed in
blank;
          (iii) subject to the terms of the Intercreditor Agreement, all other
certificates, agreements (including Control Agreements) or instruments necessary
to perfect the Collateral Agent’s security interest in all “Chattel Paper”,
“Instruments”, “Deposit Accounts” and “Investment Property” (as each such term
is defined in the U.S. Security Agreement) of each Loan Party to the extent
required hereby or under the relevant Security Documents;
          (iv) UCC financing statements in appropriate form for filing under the
UCC, filings with the United States Patent and Trademark Office and United
States Copyright Office PPSA filings, and such other documents under applicable
Requirements of Law in each jurisdiction as may be necessary or appropriate or,
in the opinion of the Collateral Agent, desirable to perfect the Liens created,
or purported to be created, by the Security Documents;
          (v) certified copies of UCC, United States Patent and Trademark Office
and United States Copyright Office, PPSA, tax and judgment lien searches,
bankruptcy and pending lawsuit searches or equivalent reports or searches (in
jurisdictions where such searches are available), each of a recent date listing
all outstanding financing statements, lien notices or comparable documents that
name any Loan Party as debtor and that are filed in those state and county (or
other applicable) jurisdictions in which any property of any Loan Party (other
than Inventory in transit) is located and the state and county (or other
applicable) jurisdictions in which any Loan Party is organized or maintains its
principal place of business and such other searches that the Collateral Agent
deems necessary or appropriate, none of which are effective to

     
 
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encumber the Collateral covered or intended to be covered by the Security
Documents (other than Permitted Liens);
          (vi) evidence acceptable to the Collateral Agent of payment or
arrangements for payment by the Loan Parties of all applicable recording taxes,
fees, charges, costs and expenses required for the recording of the Security
Documents;
          (vii) evidence that all Liens (other than Permitted Liens) affecting
the assets of the Loan Parties have been or will be discharged on or before the
Closing Date (or, in the case of financing statement filings or similar notice
of lien filings that do not evidence security interests (other than security
interests that are discharged on or before the Closing Date), that arrangements
with respect to the release or termination thereof satisfactory to the
Administrative Agent have been made);
          (viii) copies of all notices required to be sent and other documents
required to be executed under the Security Documents;
          (ix) all share certificates, duly executed and stamped stock transfer
forms and other documents of title required to be provided under the Security
Documents; and
          (x) evidence that the records of each U.K. Guarantor at the United
Kingdom Companies House are accurate, complete and up to date and that the
latest relevant accounts have been duly filed.
     (o) Real Property Requirements. The Collateral Agent shall have received:
          (i) a Mortgage encumbering each Mortgaged Property in favor of the
Collateral Agent, for the benefit of the Secured Parties, duly executed and
acknowledged by each Loan Party that holds any direct interest in such Mortgaged
Property, and otherwise in form for recording in the recording office of each
applicable political subdivision where each such Mortgaged Property is situated,
together with such certificates, affidavits, questionnaires or returns as shall
be required in connection with the recording or filing thereof to create a lien
under applicable Requirements of Law, and such financing statements and any
other instruments necessary to grant a mortgage lien under the laws of any
applicable jurisdiction, all of which shall be in form and substance reasonably
satisfactory to Collateral Agent;
          (ii) with respect to each Mortgaged Property, such consents,
approvals, amendments, supplements, estoppels, tenant subordination agreements
or other instruments as necessary to consummate the Transactions or as shall
reasonably be deemed necessary by the Collateral Agent in order for the owner or
holder of the fee or leasehold interest constituting such Mortgaged Property to
grant the Lien contemplated by the Mortgage with respect to such Mortgaged
Property;
          (iii) with respect to each Mortgage of property located in the United
States, Canada or, to the extent reasonably requested by the Collateral Agent,
any other jurisdictions, (a) a policy of title insurance (or marked up title
insurance commitment having the effect of a policy of title insurance) insuring
the Lien of such Mortgage as a valid, perfected mortgage Lien on the Mortgaged
Property and fixtures described therein having the priority specified in the

     
 
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Intercreditor Agreement in the amount equal to not less than 115% of the fair
market value of such Mortgaged Property and fixtures, which fair market value is
set forth on Schedule 4.01(o)(iii), which policy (or such marked-up commitment)
(each, a “Title Policy”) shall (A) be issued by the Title Company, (B) to the
extent necessary, include such reinsurance arrangements (with provisions for
direct access, if necessary) as shall be reasonably acceptable to the Collateral
Agent, (C) contain a “tie-in” or “cluster” endorsement, if available under
applicable law (i.e., policies which insure against losses regardless of
location or allocated value of the insured property up to a stated maximum
coverage amount), (D) have been supplemented by such endorsements (or where such
endorsements are not available, opinions of special counsel, architects or other
professionals reasonably acceptable to the Collateral Agent) as shall be
reasonably requested by the Collateral Agent (including endorsements on matters
relating to usury, first loss, last dollar, zoning, contiguity, revolving
credit, doing business, non-imputation, public road access, survey, variable
rate, environmental lien, subdivision, mortgage recording tax, separate tax lot,
revolving credit, and so-called comprehensive coverage over covenants and
restrictions), and (E) contain no exceptions to title other than exceptions
acceptable to the Collateral Agent, it being acknowledged that Permitted Liens
of the type described in Section 6.02(a), 6.02(b), 6.02(d), 6.02(f) (clause
(x) only), 6.02(g), and 6.02(k) shall be acceptable or (b) in respect of
Mortgaged Property situated outside the United States, a title opinion of
Canadian Borrower’s local counsel in form and substance satisfactory to the
Collateral Agent;
          (iv) with respect to each applicable Mortgaged Property, such
affidavits, certificates, information (including financial data) and instruments
of indemnification (including a so-called “gap” indemnification) as shall be
required to induce the Title Company to issue the Title Policy/ies and
endorsements contemplated above;
          (v) evidence reasonably acceptable to the Collateral Agent of payment
by the applicable Borrowers of all Title Policy premiums, search and examination
charges, escrow charges and related charges, mortgage recording taxes, fees,
charges, costs and expenses required for the recording of the Mortgages and
issuance of the Title Policies referred to above;
          (vi) with respect to each Real Property or Mortgaged Property, copies
of all Leases in which any Loan Party or any Subsidiary holds the lessor’s
interest or other agreements relating to possessory interests, if any, in each
case providing for annual rental payments in excess of $250,000. To the extent
any of the foregoing affect any Mortgaged Property, such agreement shall be
subordinate to the Lien of the Mortgage to be recorded against such Mortgaged
Property, either expressly by its terms or pursuant to a subordination,
non-disturbance and attornment agreement, and shall otherwise be acceptable to
the Collateral Agent;
          (vii) with respect to each Mortgaged Property, each Company shall have
made all notifications, registrations and filings, to the extent required by,
and in accordance with, all Governmental Real Property Disclosure Requirements
applicable to such Mortgaged Property;
          (viii) to the extent requested by the Collateral Agent, Surveys with
respect to the Mortgaged Properties;
          (ix) a completed Federal Emergency Management Agency Standard Flood
Hazard Determination with respect to each Mortgaged Property situated in the
United States;

     
 
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          (x) (a) title deeds to each real and leasehold property situated in
England and Wales secured in favor of the Collateral Agent; or (b) a letter
(satisfactory to the Collateral Agent) from solicitors holding those title deeds
undertaking to hold them to the order of the Collateral Agent; or (c) if any
document is at the Land Registry, a certified copy of that document and a letter
from the U.K. Guarantors’ solicitors directing the registry to issue the
document to the Collateral Agent or its solicitors; and
          (xi) in relation to property situated in England and Wales, if
applicable, satisfactory priority searches at the Land Registry and Land Charges
Searches, giving not less that 25 Business Days’ priority notice beyond the date
of the debenture and evidence that no Lien is registered against the relevant
property (other than Permitted Liens or any Liens that will be released on the
date of first drawdown, such searches to be addressed to or capable of being
relied upon by the Secured Parties).
     (p) Insurance. The Administrative Agent shall have received a copy of, or a
certificate as to coverage under, the property and liability insurance policies
required by Section 5.04 and the applicable provisions of the Security
Documents, each of which shall be endorsed or otherwise amended to include a
“standard” lender’s loss payable or mortgagee endorsement (as applicable) and
shall name the Collateral Agent, on behalf of the Secured Parties, as additional
insured, in form and substance satisfactory to the Administrative Agent.
     (q) USA Patriot Act. The Lenders shall have received, sufficiently in
advance of the Closing Date, all documentation and other information that may be
required by the Lenders in order to enable compliance with applicable “know your
customer” and anti-money laundering rules and regulations, including the United
States PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) including, without limitation, the information described in Section
11.13.
     (r) Cash Management. The Collateral Agent and the Administrative Agent
shall have reviewed and approved the Companies’ cash management system and shall
have received executed blocked account agreements (or, with respect to countries
other than the United States and Canada, other customary arrangements) from all
of the financial institutions where the Loan Parties maintain bank accounts or
securities accounts (except as may otherwise be agreed by the Collateral Agent)
in form and substance satisfactory to Administrative Agent and Collateral Agent.
     (s) Process Agent. The Collateral Agent and the Administrative Agent shall
have received evidence of the acceptance by the Process Agent of its appointment
as such by the Loan Parties.
     (t) Outstanding Indebtedness. The Collateral Agent and the Administrative
Agent shall have received evidence that the amount of funded indebtedness and
unfunded commitments under that certain Credit Agreement, dated as of January 7,
2005, among Novelis Inc., Novelis Corporation, Novelis Deutschland GmbH, Novelis
UK Ltd, Novelis AG, the lenders and issuers party thereto, and Citicorp North
America, Inc., as administrative agent and collateral agent (as amended,
restated, supplemented or otherwise modified), shall not exceed $1,500 million.

     
 
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SECTION 4.02 Conditions to Credit Extensions. The obligation of each Lender to
make the initial Credit Extension and the obligation of any Lenders to make the
initial Credit Extension under any Incremental Term Loan Commitments shall be
subject to, and to the satisfaction of, each of the conditions precedent set
forth below.
     (a) Notice. The Administrative Agent shall have received a Borrowing
Request as required by Section 2.03 (or such notice shall have been deemed given
in accordance with Section 2.03).
     (b) No Default. No Default shall exist, or would result from such proposed
Credit Extension or from the application of the proceeds therefrom (subject to
Section 4.02(c) and Section 4.03 in the case of the initial Credit Extension).
     (c) Representations and Warranties. Each of the representations and
warranties made by any Loan Party set forth in ARTICLE III hereof or in any
other Loan Document (other than Hedging Agreements) shall be true and correct in
all material respects on and as of the date of such Credit Extension with the
same effect as though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date, in which
case such representation and warranty shall have been true and correct in all
material respects as of such earlier date; provided that in the case of the
initial Credit Extension hereunder only, the representations contained in
Sections 3.04 (Financial Statements; Projections), 3.05 (Properties), 3.06
(Intellectual Property), 3.07 (Equity Interests and Subsidiaries), 3.08
(Litigation; Compliance with Laws) (other than clause (i) thereunder), 3.09
(Agreements), 3.13 (Taxes), 3.14 (No Material Misstatements), 3.15 (Labor
Matters), 3.17 (Employee Benefit Plans), 3.18 (Environmental Matters), 3.19
(Insurance), 3.21 (Acquisition Documents; Material Indebtedness Documents;
Representations and Warranties in Acquisition Agreement), 3.24 (Location of
Material Inventory and Equipment), 3.26 (Senior Notes; Material Indebtedness)
(solely with regard to the first sentence thereof), 3.27 (Centre of Main
Interests and Establishments) and 3.28 (Holding and Dormant Companies) shall
only be conditions to the obligation of each Lender to fund the initial Credit
Extension requested to be made by it on the date of the initial Credit
Extensions hereunder to the extent that, as a result of the breach of such
representation, Acquiror (x) had or would have had the right to terminate its
obligations under the Acquisition Agreement on the Acquisition Closing Date (or
to not consummate the Hindalco Acquisition on the Acquisition Closing Date) and
(y) Acquiror or any of its affiliates, representatives or advisors had, as of
the Acquisition Closing Date, knowledge of such right to terminate or right to
not consummate the Acquisition.
     (d) No Legal Bar. With respect to each Lender, no order, judgment or decree
of any Governmental Authority shall purport to restrain such Lender from making
any Loans to be made by it. No injunction or other restraining order shall have
been issued, shall be pending or noticed with respect to any action, suit or
proceeding seeking to enjoin or otherwise prevent the consummation of, or to
recover any damages or obtain relief as a result of, the transactions
contemplated by this Agreement or the making of Loans hereunder.
     Each of the delivery of a Borrowing Request and the acceptance by any
Borrower of the proceeds of such Credit Extension shall constitute a
representation and warranty by each Borrower and each other Loan Party that on
the date of such Credit Extension (both immediately

     
 
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before and after giving effect to such Credit Extension and the application of
the proceeds thereof) the conditions contained in Section 4.02(b) through (d)
have been satisfied (which representation and warranty shall be deemed limited
to the knowledge of the Loan Parties in the case of the first sentence of
Section 4.02(d)). Borrowers shall provide such information as the Administrative
Agent may reasonably request to confirm that the conditions in Section 4.02(b)
through (d) have been satisfied.
SECTION 4.03 Certain Collateral Matters. To the extent any Collateral (other
than the pledge and perfection of the Lien of the Collateral Agent in the Equity
Interests of Subsidiaries held by the Loan Parties (to the extent required
hereunder) and other assets pursuant to which a lien may be perfected by the
filing of a financing statement under the UCC, the PPSA and other similar
filings in other applicable jurisdictions) is not provided on the Closing Date
after use by Holdings and its Subsidiaries of commercially reasonable efforts to
do so, the delivery of such Collateral shall not constitute a condition
precedent to the Closing Date, but shall be required to be delivered after the
Closing Date pursuant to arrangements and timing to be mutually agreed by the
Borrowers and the Administrative Agent.
ARTICLE V.
AFFIRMATIVE COVENANTS
     Each Loan Party warrants, covenants and agrees with each Lender that so
long as this Agreement shall remain in effect and until the Commitments have
been terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Loan Document shall have been paid
in full, unless the Required Lenders shall otherwise consent in writing, each
Loan Party will, and will cause each of its Subsidiaries to:
SECTION 5.01 Financial Statements, Reports, etc. Furnish to the Administrative
Agent (and the Administrative Agent shall make available to the Lenders, on the
Platform or otherwise, in accordance with its customary procedures):
     (a) Annual Reports. As soon as available and in any event within the
earlier of (i) ninety (90) days and (ii) such shorter period as may be required
by the Securities and Exchange Commission, after the end of each fiscal year,
beginning with the first fiscal year ending after the Closing Date, (i) the
consolidated balance sheet of Canadian Borrower as of the end of such fiscal
year and related consolidated statements of income, cash flows and stockholders’
equity for such fiscal year, in comparative form with such financial statements
as of the end of, and for, the preceding fiscal year, and notes thereto, all
prepared in accordance with Regulation S-X and accompanied by an opinion of
independent public accountants of recognized national standing reasonably
satisfactory to the Administrative Agent (which opinion shall not be qualified
as to scope or contain any going concern qualification, paragraph of emphasis or
explanatory statement), stating that such financial statements fairly present,
in all material respects, the consolidated financial condition, results of
operations and cash flows of Canadian Borrower as of the dates and for the
periods specified in accordance with GAAP, (ii) a narrative report and
management’s discussion and analysis, in a form reasonably satisfactory to the
Administrative Agent, of the financial condition and results of operations of
Canadian Borrower for such fiscal year, as compared to amounts for the previous
fiscal year (it being understood that the

     
 
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information required by clauses (i) and (ii) of this Section 5.01(a) may be
furnished in the form of a Form 10-K (so long as the financial statements,
narrative report and management’s discussion therein comply with the
requirements set forth above)) and (iii) consolidating balance sheets,
statements of income and cash flows of Canadian Borrower and its Subsidiaries
separating out the results by region;
     (b) Quarterly Reports. As soon as available and in any event within the
earlier of (i) forty-five (45) days and (ii) such shorter period as may be
required by the Securities and Exchange Commission, after the end of each of the
first three fiscal quarters of each fiscal year, beginning with the fiscal
quarter ending June 30, 2007, (i) the consolidated balance sheet of Canadian
Borrower as of the end of such fiscal quarter and related consolidated
statements of income and cash flows for such fiscal quarter and for the then
elapsed portion of the fiscal year, in comparative form with the consolidated
statements of income and cash flows for the comparable periods in the previous
fiscal year, and notes thereto, all prepared in accordance with Regulation S-X
under the Securities Act and accompanied by a certificate of a Financial Officer
stating that such financial statements fairly present, in all material respects,
the consolidated financial condition, results of operations and cash flows of
Canadian Borrower as of the date and for the periods specified in accordance
with GAAP consistently applied, and on a basis consistent with audited financial
statements referred to in clause (a) of this Section, except as otherwise
disclosed therein and subject to the absence of footnote disclosures and to
normal year-end audit adjustments, (ii) a narrative report and management’s
discussion and analysis, in a form reasonably satisfactory to the Administrative
Agent, of the financial condition and results of operations for such fiscal
quarter and the then elapsed portion of the fiscal year, as compared to the
comparable periods in the previous fiscal year (it being understood that the
information required by clauses (i) and (ii) of this Section 5.01(b) may be
furnished in the form of a Form 10-Q (so long as the financial statements,
management report and management’s discussion therein comply with the
requirements set forth above)) and (iii) consolidating balance sheets,
statements of income and cash flows of Canadian Borrower and its Subsidiaries
separating out the results by region;
     (c) [INTENTIONALLY OMITTED];
     (d) Financial Officer’s Certificate. (i) Concurrently with any delivery of
financial statements under Section 5.01(a) or (b), beginning with the fiscal
quarter ending June 30, 2007, a Compliance Certificate (A) certifying that no
Default has occurred or, if such a Default has occurred, specifying the nature
and extent thereof and any corrective action taken or proposed to be taken with
respect thereto, (B) concurrently with any delivery of financial statements
under Section 5.01(a) above (commencing with the financial statements for the
first complete fiscal year of Canadian Borrower beginning after the Closing
Date), setting forth Canadian Borrower’s calculation of Excess Cash Flow and
(C) showing a reconciliation of Consolidated EBITDA to the net income set forth
on the statement of income, such reconciliation to be on a quarterly basis; and
(ii) concurrently with any delivery of financial statements under
Section 5.01(a) above, to the extent permitted under applicable accounting
guidelines, a report of the accounting firm opining on or certifying such
financial statements stating that in the course of its regular audit of the
financial statements of Canadian Borrower and its Subsidiaries, such accounting
firm obtained no knowledge that any Default has occurred, or if any Default has
occurred, specifying the nature and extent thereof;

     
 
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     (e) Officer’s Certificate Regarding Organizational Chart and Perfection of
Collateral. Concurrently with any delivery of financial statements under
Section 5.01(a), a certificate of a Responsible Officer of Canadian Borrower
attaching an accurate organizational chart (or confirming that there has been no
change in organizational structure) and otherwise setting forth the information
required pursuant to the Perfection Certificate Supplement or confirming that
there has been no change in such information since the date of the Perfection
Certificate or latest Perfection Certificate Supplement;
     (f) Public Reports. Promptly after the same become publicly available,
copies of all periodic and other reports, proxy statements and other materials
filed by any Loan Party with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any or all of the functions of said
Commission, with any national U.S. or non-U.S. securities regulatory authority
or securities exchange or with the National Association of Securities Dealers,
Inc., or distributed to holders of its publicly held Indebtedness or securities
pursuant to the terms of the documentation governing such Indebtedness or
securities (or any trustee, agent or other representative therefor), as the case
may be; provided that documents required to be delivered pursuant to this clause
(f) may be delivered electronically and if so delivered, shall be deemed to have
been delivered on the date (i) on which Canadian Borrower posts such documents,
or provides a link thereto on Canadian Borrower’s website (or other location
specified by Canadian Borrower) on the Internet; or (ii) on which such documents
are posted on Canadian Borrower’s behalf on the Platform; provided that:
(i) upon written request by the Administrative Agent, Canadian Borrower shall
deliver paper copies of such documents to the Administrative Agent for further
distribution to each Lender until a written request to cease delivering paper
copies is given by the Administrative Agent and (ii) Canadian Borrower shall
notify (which may be by facsimile or electronic mail) the Administrative Agent
of the posting of any such documents and provide to the Administrative Agent by
electronic mail electronic versions (i.e., soft copies) of such documents;
provided, further, that notwithstanding anything contained herein, in every
instance Canadian Borrower shall be required to provide paper copies of the
certificates required by clauses (d) and (e) of this Section 5.01 to the
Administrative Agent;
     (g) Management Letters. Promptly after the receipt thereof by any Company,
a copy of any “management letter”, exception report or other similar letter or
report received by any such person from its certified public accountants and the
management’s responses thereto;
     (h) Projections. Within sixty (60) days of the end of each fiscal year, a
copy of the annual projections for Canadian Borrower (including balance sheets,
statements of income and sources and uses of cash, for (i) each quarter of such
fiscal year prepared in detail and (ii) each fiscal year thereafter, through and
including the fiscal year in which the Final Maturity Date occurs, prepared in
summary form, in each case, of Canadian Borrower on a consolidated basis, with
appropriate presentation and discussion of the principal assumptions upon which
such forecasts are based, accompanied by the statement of a Financial Officer of
Canadian Borrower to the effect that such assumptions are believed to be
reasonable;
     (i) Labor Relations. Promptly after becoming aware of the same, written
notice of (a) any labor dispute to which any Loan Party or any of its
Subsidiaries is or is expected to become a party, including any strikes,
lockouts or other labor disputes relating to any of such person’s plants and
other facilities, which could reasonably be expected to result in a Material

     
 
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Adverse Effect, (b) any Worker Adjustment and Retraining Notification Act or
related liability incurred with respect to the closing of any plant or other
facility of any such person and (c) any material liability under Requirements of
Law similar to the Worker Adjustment and Retraining Notification Act or
otherwise arising out of plant closings;
     (j) Asset Sales. At least ten (10) days prior to an Asset Sale, the Net
Cash Proceeds of which (or the Dollar Equivalent thereof) are anticipated to
exceed $20 million written notice (a) describing such Asset Sale or the nature
and material terms and conditions of such transaction and (b) stating the
estimated Net Cash Proceeds anticipated to be received by any Loan Party or any
of its Subsidiaries; and
     (l) Other Information. Promptly, from time to time, such other information
regarding the operations, properties, business affairs and condition (financial
or otherwise) of any Company, or compliance with the terms of any Loan Document,
or matters regarding the Collateral (beyond the requirements contained in
Section 9.03) as the Administrative Agent or any Lender may reasonably request.
SECTION 5.02 Litigation and Other Notices. Furnish to the Administrative Agent
written notice of the following promptly (and, in any event, within three
(3) Business Days after acquiring knowledge thereof):
     (a) any Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect thereto;
     (b) the filing or commencement of, or any written notice of intention of
any person to file or commence, any action, suit, litigation or proceeding,
whether at law or in equity by or before any Governmental Authority, (i) against
any Borrower or other Company that in the reasonable judgment of the Borrowers
could reasonably be expected to result in a Material Adverse Effect if adversely
determined or (ii) with respect to any Loan Document;
     (c) any development that has resulted in, or could reasonably be expected
to result in, a Material Adverse Effect;
     (d) the occurrence of a Casualty Event involving a Dollar Equivalent amount
in excess of $20 million; and
     (e) (i) the incurrence of any Lien (other than Permitted Liens) on the
Collateral, or claim asserted against any of the Collateral or (ii) the
occurrence of any other event which could reasonably be expected to affect the
value of the Collateral, in each case which could reasonably be expected to be
material with regard to (x) the Revolving Credit Priority Collateral, taken as a
whole, or (y) the Term Loan Priority Collateral, taken as a whole.
SECTION 5.03 Existence; Businesses and Properties.
     (a) Do or cause to be done all things reasonably necessary to preserve,
renew and keep in full force and effect its legal existence, rights and
franchises necessary or desirable in the normal conduct of its business, except
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the extent the failure to do so would not reasonably be expected to have a
Material Adverse Effect or (ii) pursuant to a transaction permitted by
Section 6.05 or Section 6.06.
     (b) Do or cause to be done all things necessary to obtain, maintain,
preserve, renew, extend and keep in full force and effect the rights, licenses,
permits, privileges, franchises, approvals, authorizations, patents, copyrights,
trademarks, service marks and trade names used, useful, or necessary to the
conduct of its business, except where the failure to do so could not reasonably
be expected to result in a Material Adverse Effect; do or cause to be done all
things necessary to preserve its business and the goodwill and business of the
customers, advertisers, suppliers and others having business relations with each
Loan Party or any of its Subsidiaries, except where the failure to do so could
not reasonably be expected to result in a Material Adverse Effect; comply with
all applicable Requirements of Law (including any and all zoning, building,
Environmental Law, ordinance, code or approval or any building permits or any
restrictions of record or agreements affecting the Real Property), contractual
obligations, and decrees and orders of any Governmental Authority, whether now
in effect or hereafter enacted, except where the failure to comply, individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect; and at all times maintain, preserve and protect all of its
property and keep such property in good repair, working order and condition
(other than wear and tear occurring in the ordinary course of business) and from
time to time make, or cause to be made, all needful and proper repairs,
renewals, additions, improvements and replacements thereto necessary in order
that the business carried on in connection therewith may be properly conducted
at all times, except in each case where the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.04 Insurance.
     (a) Generally. Keep its insurable property adequately insured at all times
by financially sound and reputable insurers; maintain such other insurance, to
such extent and against such risks as is customary with companies in the same or
similar businesses operating in the same or similar locations, including
insurance with respect to Mortgaged Properties and other properties material to
the business of the Companies against such casualties and contingencies and of
such types and in such amounts with such deductibles as is customary in the case
of similar businesses operating in the same or similar locations, including
(i) physical hazard insurance on an “all risk” basis (subject to usual and
customary exclusions), (ii) commercial general liability against claims for
bodily injury, death or property damage covering any and all insurable claims,
(iii) explosion insurance in respect of any boilers, machinery or similar
apparatus constituting Collateral, (iv) business interruption insurance and
flood insurance, and (v) worker’s compensation insurance and such other
insurance as may be required by any Requirement of Law; provided that with
respect to physical hazard insurance, neither the Collateral Agent nor the
applicable Company shall agree to the adjustment of any claim thereunder with
respect to Term Loan Priority Collateral involving an amount in excess of
$30 million thereunder without the consent of the other (such consent not to be
unreasonably withheld or delayed); provided, further, that no consent of any
Company shall be required during an Event of Default.
     (b) Requirements of Insurance. All such property and liability insurance
maintained by the Loan Parties shall (i) provide that no cancellation, material
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material change in coverage thereof shall be effective until at least thirty
(30) days after receipt by the Collateral Agent of written notice thereof,
(ii) name the Collateral Agent as mortgagee or loss payee, as applicable (in the
case of property insurance) or additional insured on behalf of the Secured
Parties (in the case of liability insurance), as applicable, and (iii) if
reasonably requested by the Collateral Agent, include a breach of warranty
clause.
     (c) Flood Insurance. Except to the extent already obtained in accordance
with clause (iv) of Section 5.04(a), with respect to each Mortgaged Property,
obtain flood insurance in such total amount as the Administrative Agent may from
time to time require, if at any time the area in which any improvements located
on any Mortgaged Property is designated a “flood hazard area” in any Flood
Insurance Rate Map published by the Federal Emergency Management Agency (or any
successor agency), and such insurance is required to be obtained pursuant to the
requirements of the National Flood Insurance Act of 1968, as amended from time
to time, or the Flood Disaster Protection Act of 1973, as amended from time to
time.
     (d) Broker’s Report. As soon as practicable and in any event within ninety
(90) days after the end of each fiscal year, deliver to the Administrative Agent
and the Collateral Agent (i) a report of a reputable insurance broker with
respect to the insurance maintained pursuant to clauses (i)-(iv) of
Section 5.04(a) in form and substance satisfactory to the Administrative Agent
and the Collateral Agent (together with such additional reports as the
Administrative Agent or the Collateral Agent may reasonably request), and
(ii) such broker’s statement that all premiums then due and payable with respect
to the coverage maintained pursuant to clauses (i)-(iv) of Section 5.04(a) have
been paid and confirming, with respect to any property, physical hazard or
liability insurance maintained by a Loan Party, that the Collateral Agent has
been named as loss payee or additional insured, as applicable.
     (e) Mortgaged Properties. Each Loan Party shall comply in all material
respects with all Insurance Requirements in respect of each Mortgaged Property;
provided, however, that each Loan Party may, at its own expense and after
written notice to the Administrative Agent, (i) contest the applicability or
enforceability of any such Insurance Requirements by appropriate legal
proceedings, the prosecution of which does not constitute a basis for
cancellation or revocation of any insurance coverage required under this
Section 5.04 or (ii) cause the Insurance Policy containing any such Insurance
Requirement to be replaced by a new policy complying with the provisions of this
Section 5.04.
SECTION 5.05 Payment of Taxes.
     (a) Payment of Taxes. Pay and discharge promptly when due all Taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits or in respect of its property, before the same shall become
delinquent or in default, as well as all lawful claims for labor, services,
materials and supplies or otherwise that, if unpaid, might give rise to a Lien
other than a Permitted Lien upon such properties or any part thereof; provided
that such payment and discharge shall not be required with respect to any such
Tax, assessment, charge, levy or claim so long as (x)(i) the validity or amount
thereof shall be contested in good faith by appropriate proceedings timely
instituted and diligently conducted and the applicable Company shall have set
aside on its books adequate reserves or other appropriate provisions with
respect thereto in accordance with GAAP (or other applicable accounting rules),
and (ii) such contest

     
 
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operates to suspend collection of the contested obligation, Tax, assessment or
charge and enforcement of a Lien other than a Permitted Lien, and (y) the
failure to pay could not reasonably be expected to result in a Material Adverse
Effect.
     (b) Filing of Returns. Timely file all material Tax Returns required to be
filed by it.
SECTION 5.06 Employee Benefits.
     (a) Comply with the applicable provisions of ERISA and the Code and any
Requirements of Law applicable to any Foreign Plan or Compensation Plan, except
where any non-compliance could not reasonably be expected to result in a
Material Adverse Effect.
     (b) Furnish to the Administrative Agent (x) as soon as possible after, and
in any event within five (5) Business Days after any Responsible Officer of any
Company or any ERISA Affiliates of any Company knows that, any ERISA Event has
occurred, a statement of a Financial Officer of Administrative Borrower setting
forth details as to such ERISA Event and the action, if any, that the Companies
propose to take with respect thereto, and (y) upon request by the Administrative
Agent, copies of such other documents or governmental reports or filings
relating to any Plan (or Foreign Plan, or other employee benefit plan sponsored
or contributed to by any Company) as the Administrative Agent shall reasonably
request.
     (c) (i) Ensure that the Novelis U.K. Pension Plan is funded in accordance
with the agreed schedule of contributions dated May 16, 2007 and that no action
or omission is taken by any Company in relation to such a pension scheme which
has or is reasonably likely to have a Material Adverse Effect; (ii) except for
any existing defined benefit pension schemes as specified on Schedule 3.17
ensure that no Company is or has been at any time an employer (for the purposes
of Sections 38 to 51 of the Pensions Act 2004) of an occupational pension scheme
which is not a money purchase scheme (both terms as defined in the Pension
Schemes Act 1993) or “connected” with or an “associate” of (as those terms are
defined in Sections 39 or 43 of the Pensions Act 2004) such an employer;
(iii) deliver to the Administrative Agent upon request as those reports are
prepared in order to comply with the then current statutory or auditing
requirements (as applicable either to the trustees of any relevant schemes),
actuarial reports in relation to all pension schemes mentioned in clause
(i) above; (iv) promptly notify the Administrative Agent of any material change
in the agreed rate of contributions to any pension schemes mentioned in clause
(i) above; (v) promptly notify the Administrative Agent of any investigation or
proposed investigation by the Pensions Regulator which may lead to the issue of
a Financial Support Direction or a Contribution Notice to any member of the
Group; and (vi) promptly notify the Administrative Agent if it receives a
Financial Support Direction or a Contribution Notice from the Pensions
Regulator.
     (d) Ensure that all Foreign Plans (except the Novelis U.K. Pension Plan)
and Compensation Plans that are required to be funded are funded and contributed
to in accordance with their terms to the extent of all Requirements of Law.
SECTION 5.07 Maintaining Records; Access to Properties and Inspections; Annual
Meetings. Keep proper books of record and account in which full, true and
correct entries in conformity in all material respects with GAAP (or other
applicable accounting

     
 
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standards) and all Requirements of Law of all financial transactions and the
assets and business of each Company and its Subsidiaries are made of all
dealings and transactions in relation to its business and activities, including,
without limitation, proper records of intercompany transactions) with full, true
and correct entries reflecting all payments received and paid (including,
without limitation, funds received by or for the account of any Loan Party from
deposit accounts of the other Companies). Each Company will permit any
representatives designated by the Administrative Agent (who may be accompanied
by any Agent or Lender) to visit and inspect the financial records and the
property of such Company (at reasonable intervals, during normal business hours
and within five Business Days after written notification of the same to
Administrative Borrower, except that, during the continuance of an Event of
Default, none of such restrictions shall be applicable) and to make extracts
from and copies of such financial records, and permit any representatives
designated by the Administrative Agent (who may be accompanied by any Agent or
Lender) to discuss the affairs, finances, accounts and condition of any Company
with the officers and employees thereof and advisors therefor (including
independent accountants).
SECTION 5.08 Use of Proceeds. Use the proceeds of the Loans only for the
purposes set forth in Section 3.12.
SECTION 5.09 Compliance with Environmental Laws; Environmental Reports.
     (a) Comply, and cause all lessees and other persons occupying Real Property
owned, operated or leased by any Company to comply, in all material respects
with all Environmental Laws and Environmental Permits applicable to its
operations and Real Property; obtain and renew all material Environmental
Permits applicable to its operations and Real Property; and conduct all
Responses required by, and in accordance with, Environmental Laws, in each case,
to the extent that the failure to do so could reasonably be expected to have a
Material Adverse Effect; provided that no Company shall be required to undertake
any Response to the extent that its obligation to do so is being contested in
good faith and by proper proceedings and appropriate reserves are being
maintained with respect to such circumstances in accordance with GAAP or other
applicable accounting standards.
     (b) If a Default caused by reason of a breach of Section 3.18 or Section
5.09(a) shall have occurred and be continuing for more than twenty (20) Business
Days without the Companies commencing activities reasonably likely to cure such
Default in accordance with Environmental Laws, at the written request of the
Administrative Agent or the Required Lenders through the Administrative Agent,
provide to the Lenders as soon as practicable after such request, at the expense
of Borrowers, an environmental assessment report regarding the matters which are
the subject of such Default, including, where appropriate, soil and/or
groundwater sampling, prepared by an environmental consulting firm and, in form
and substance, reasonably acceptable to the Administrative Agent and indicating
the presence or absence of Hazardous Materials and the estimated cost of any
compliance or Response to address them.
SECTION 5.10 Interest Rate Protection. From and after the thirtieth (30th) day
after the Closing Date and for a minimum of four years thereafter maintain fixed
rate Indebtedness, or Hedging Agreements with terms and conditions acceptable to
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together result in at least 45% of the aggregate principal amount of Holdings’s
Consolidated Indebtedness being effectively subject to a fixed or maximum
interest rate.
SECTION 5.11 Additional Collateral; Additional Guarantors.
     (a) Subject to the terms of the Intercreditor Agreement and this
Section 5.11, with respect to any property acquired after the Closing Date by
any Loan Party that is intended to be subject to the Lien created by any of the
Security Documents but is not so subject, promptly (and in any event within
thirty (30) days after the acquisition thereof) (i) execute and deliver to the
Administrative Agent and the Collateral Agent such amendments or supplements to
the relevant Security Documents or such other documents as the Administrative
Agent or the Collateral Agent shall deem necessary or advisable to grant to the
Collateral Agent, for its benefit and for the benefit of the other Secured
Parties, a First Priority Lien on such property subject to no Liens other than
Permitted Liens, and (ii) take all actions necessary to cause such Lien to be
duly perfected to the extent required by such Security Document in accordance
with all applicable Requirements of Law, including the filing of financing
statements (or other applicable filings) in such jurisdictions as may be
reasonably requested by the Administrative Agent. Borrowers shall otherwise take
such actions and execute and/or deliver to the Collateral Agent such documents
as the Administrative Agent or the Collateral Agent shall reasonably require to
confirm the validity, perfection and priority of the Lien of the Security
Documents against such after-acquired properties.
     (b) With respect to any person that becomes a Subsidiary after the Closing
Date (other than an Excluded Collateral Subsidiary), or any Subsidiary that was
an Excluded Collateral Subsidiary but, as of the end of the most recently ended
fiscal quarter, has ceased to be an Excluded Collateral Subsidiary or is
required to become a Loan Party by operation of the provisions of
Section 5.11(d), promptly (and in any event within thirty (30) days after such
person becomes a Subsidiary or ceases to be an Excluded Collateral Subsidiary or
is required to become a Loan Party by operation of the provisions of
Section 5.11(d)) (i) pledge and deliver to the Collateral Agent the
certificates, if any, representing all of the Equity Interests of such
Subsidiary owned by a Loan Party, together with undated stock powers or other
appropriate instruments of transfer executed and delivered in blank by a duly
authorized officer of the holder(s) of such Equity Interests, and all
intercompany notes owing from such Subsidiary to any Loan Party together with
instruments of transfer executed and delivered in blank by a duly authorized
officer of such Loan Party and (ii) cause any such Subsidiary that is a Wholly
Owned Subsidiary, in each case to the extent not prohibited by applicable
Requirements of Law, (A) to execute a Joinder Agreement or such comparable
documentation to become a Subsidiary Guarantor and joinder agreements to the
applicable Security Documents (in each case, substantially in the form annexed
thereto or in such other form as may be reasonably satisfactory to the
Administrative Agent) or, in the case of a Foreign Subsidiary, execute such
other Security Documents (or joinder agreements) to the extent possible under
and compatible with the laws of such Foreign Subsidiary’s jurisdiction in form
and substance reasonably satisfactory to the Administrative Agent, and (B) to
take all actions necessary or advisable in the opinion of the Administrative
Agent or the Collateral Agent to cause the Liens created by the applicable
Security Documents to be duly perfected to the extent required by such agreement
in accordance with all applicable Requirements of Law, including the filing of
financing statements (or other applicable filings) in such jurisdictions as may
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Agent or the Collateral Agent. Notwithstanding the foregoing, (1) clause (i) of
this paragraph (b) shall not apply to the Equity Interests of (x) any Company
listed on Schedule 5.11(b) to the extent any applicable Requirement of Law
continues to prohibit the pledging of its Equity Interests to secure the Secured
Obligations and (y) any Joint Venture Subsidiary, to the extent the terms of any
applicable joint venture, stockholders’, partnership, limited liability company
or similar agreement prohibits or conditions the pledging of its Equity
Interests to secure the Secured Obligations and (2) clause (ii) of this
paragraph (b) shall not apply to any Company listed on Schedule 5.11(b) to the
extent any applicable Requirement of Law prohibits it from becoming a Loan
Party.
     (c) Subject to the terms of the Intercreditor Agreement, promptly grant to
the Collateral Agent, within sixty (60) days of the acquisition thereof, a
security interest in and Mortgage on (i) each Real Property owned in fee by such
Loan Party as is acquired by such Loan Party after the Closing Date and that,
together with any improvements thereon, individually has a fair market value the
Dollar Equivalent of which is at least $5 million, and (ii) unless the
Collateral Agent otherwise consents, and subject to obtaining any consent
required from the applicable landlord and any applicable mortgagee (each of
which the Loan Parties agree to use commercially reasonable efforts to obtain),
each leased Real Property of such Loan Party which lease individually has a fair
market value the Dollar Equivalent of which is at least $5 million, in each
case, as additional security for the Secured Obligations (unless the subject
property is already mortgaged to a third party to the extent permitted by
Section 6.02). Subject to the terms of the Intercreditor Agreement, such
Mortgages shall be granted pursuant to documentation reasonably satisfactory in
form and substance to the Administrative Agent and the Collateral Agent and
shall constitute valid, perfected and enforceable First Priority Liens subject
only to Permitted Liens. Subject to the terms of the Intercreditor Agreement,
the Mortgages or instruments related thereto shall be duly recorded or filed in
such manner and in such places as are required by law to establish, perfect,
preserve and protect the First Priority Liens in favor of the Collateral Agent
required to be granted pursuant to the Mortgages and all taxes, fees and other
charges payable in connection therewith shall be paid in full. Such Loan Party
shall otherwise take such actions and execute and/or deliver to the Collateral
Agent such documents as the Administrative Agent or the Collateral Agent shall
reasonably require to confirm the validity, perfection and priority of the Lien
of any existing Mortgage or new Mortgage against such after-acquired Real
Property (including a Title Policy (or title opinion satisfactory to the
Collateral Agent), a Survey (if applicable in the respective jurisdiction), and
a local counsel opinion (in form and substance reasonably satisfactory to the
Administrative Agent and the Collateral Agent) in respect of such Mortgage). For
purposes of this Section 5.11(c) Real Property owned by a Company that becomes a
Loan Party following the Closing Date in accordance with the terms of this
Agreement shall be deemed to have been acquired on the later of (x) the date of
acquisition of such Real Property and (y) the date such Company becomes a Loan
Party.
     (d) If, at any time and from time to time after the Closing Date,
Subsidiaries that are not Loan Parties because they are Excluded Collateral
Subsidiaries comprise in the aggregate more than 1% of the consolidated total
assets of Canadian Borrower and its Subsidiaries as of the end of the most
recently ended fiscal quarter or more than 1% of Consolidated EBITDA of Canadian
Borrower and its Subsidiaries as of the end of the most recently ended fiscal
quarter, then the Loan Parties shall, not later than 45 days after the date by
which financial statements for such fiscal quarter are required to be delivered
pursuant to this Agreement, cause one or more of

     
 
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such Subsidiaries to become Loan Parties (notwithstanding that such Subsidiaries
are, individually, Excluded Collateral Subsidiaries) such that the foregoing
condition ceases to be true.
SECTION 5.12 Security Interests; Further Assurances. Subject to the terms of the
Intercreditor Agreement, promptly, upon the reasonable request of the
Administrative Agent or the Collateral Agent, at Borrowers’ expense, execute,
acknowledge and deliver, or cause the execution, acknowledgment and delivery of,
and thereafter register, file or record, or cause to be registered, filed or
recorded, in an appropriate governmental office, any document or instrument
supplemental to or confirmatory of the Security Documents or otherwise deemed by
the Administrative Agent or the Collateral Agent reasonably necessary or
desirable for the continued validity, perfection and priority of the Liens on
the Collateral covered thereby subject to no other Liens except Permitted Liens,
or use commercially reasonable efforts to obtain any consents or waivers as may
be reasonably required in connection therewith. Deliver or cause to be delivered
(using commercially reasonable efforts with respect to delivery of items from
Persons who are not in the control of any Loan Party) to the Administrative
Agent and the Collateral Agent from time to time such other documentation,
consents, authorizations, approvals and orders in form and substance reasonably
satisfactory to the Administrative Agent and the Collateral Agent as the
Administrative Agent and the Collateral Agent shall reasonably deem necessary to
perfect or maintain the Liens on the Collateral pursuant to the Security
Documents. Upon the exercise by the Administrative Agent, the Collateral Agent
or any Lender of any power, right, privilege or remedy pursuant to any Loan
Document that requires any consent, approval, registration, qualification or
authorization of any Governmental Authority, execute and deliver all
applications, certifications, instruments and other documents and papers that
the Administrative Agent, the Collateral Agent or such Lender may reasonably
require in connection therewith. If the Administrative Agent, the Collateral
Agent or the Required Lenders determine that they are required by a Requirement
of Law to have appraisals prepared in respect of the Real Property of any Loan
Party constituting Collateral, Borrowers shall provide to the Administrative
Agent appraisals that satisfy the applicable requirements of the Real Estate
Appraisal Reform Amendments of FIRREA (or other applicable requirements) and are
otherwise in form satisfactory to the Administrative Agent and the Collateral
Agent.
SECTION 5.13 Information Regarding Collateral. Not effect any change (i) in any
Loan Party’s legal name or in any trade name used to identify it in the conduct
of its business or in the ownership of its properties, (ii) in the location of
any Loan Party’s chief executive office, its principal place of business, any
office in which it maintains books or records relating to Collateral owned by it
or any office or facility at which any material Term Loan Priority Collateral
owned by it is located (including the establishment of any such new office or
facility) other than changes in location to a property identified on
Schedule 3.24, another property location previously identified on a Perfection
Certificate Supplement or otherwise by notice to the Collateral Agent, as to
which the steps required by clause (B) below have been completed or to a
Mortgaged Property or a leased property subject to a Landlord Access Agreement,
(iii) in any Loan Party’s identity or organizational structure, (iv) in any Loan
Party’s Federal Taxpayer Identification Number or organizational identification
number, if any, or (v) in any Loan Party’s jurisdiction of organization (in each
case, including by merging with or into any other entity, reorganizing,
dissolving, liquidating, reorganizing or organizing in any other jurisdiction),
until (A) it shall have given the Collateral Agent and the Administrative Agent
not less than ten (10)

     
 
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Business Days’ prior written notice (in the form of an Officers’ Certificate),
or such lesser notice period agreed to by the Collateral Agent, of its intention
so to do, clearly describing such change and providing such other information in
connection therewith as the Collateral Agent or the Administrative Agent may
reasonably request and (B) it shall have taken all action reasonably
satisfactory to the Collateral Agent to maintain the perfection and priority of
the security interest of the Collateral Agent for the benefit of the Secured
Parties in the Collateral, if applicable. Each Loan Party agrees to promptly
provide the Collateral Agent with certified Organizational Documents reflecting
any of the changes described in the preceding sentence. For the purposes of the
Regulation, (i) no U.K. Guarantor shall change its centre of main interest (as
that term is used in Article 3(1) of the Regulation) from England and Wales,
(ii) nor shall any Irish Guarantor change its centre of main interest from
Ireland, nor shall any Irish Guarantor have an “establishment” (as that term is
used in Article 2(h) of the Regulation) in any other jurisdiction, (iii) nor
shall nor shall any Swiss Guarantor change its centre of main interest from
Switzerland, nor shall any Swiss Guarantor have an “establishment” in any other
jurisdiction, (iv) nor shall German Seller change its centre of main interest
from Germany.
SECTION 5.14 Affirmative Covenants with Respect to Leases. With respect to each
Lease to which a Loan Party is party as landlord or lessor, the respective Loan
Party shall perform all the obligations imposed upon the landlord under such
Lease and enforce all of the tenant’s obligations thereunder, except where the
failure to so perform or enforce could not reasonably be expected to result in a
Property Material Adverse Effect.
SECTION 5.15 Secured Obligations. Timely pay and perform all of its Secured
Obligations.
SECTION 5.16 Post-Closing Covenants. Execute and deliver the documents and
complete the tasks and take the other actions set forth on Schedule 5.16, in
each case within the time limits specified on such Schedule.
ARTICLE VI.
NEGATIVE COVENANTS
     Each Loan Party warrants, covenants and agrees with each Lender that, so
long as this Agreement shall remain in effect and until the Commitments have
been terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Loan Document have been paid in
full, unless the Required Lenders (and such other Lenders whose consent may be
required under Section 11.02) shall otherwise consent in writing, no Loan Party
will, nor will they cause or permit any Subsidiaries to:
SECTION 6.01 Indebtedness. Incur, create, assume or permit to exist, directly or
indirectly, any Indebtedness, except
     (a) Indebtedness incurred under this Agreement and the other Loan
Documents;
     (b) (i) Indebtedness outstanding on the Closing Date and listed on
Schedule 6.01(b), and Permitted Refinancings thereof, (ii) Indebtedness of Loan
Parties under the Revolving Credit Loan Documents and Permitted Revolving Credit
Facility Refinancings thereof in an

     
 
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aggregate principal amount at any time outstanding not to exceed the Maximum
Revolving Credit Facility Amount, (iii) Indebtedness of Loan Parties and other
persons referenced on Schedule 6.01(b) under the Senior Note Documents and
Indebtedness under Permitted Refinancings thereof, and (iv) the Subordinated
Debt Loan and Permitted Refinancings thereof;
     (c) Indebtedness of any Company under Hedging Agreements (including
Contingent Obligations with respect thereto); provided that if such Hedging
Obligations relate to interest rates, (i) such Hedging Agreements relate to
payment obligations on Indebtedness otherwise permitted to be incurred by the
Loan Documents and (ii) the notional principal amount of such Hedging Agreements
at the time incurred does not exceed the principal amount of the Indebtedness to
which such Hedging Agreements relate;
     (d) Indebtedness permitted by Section 6.04(i);
     (e) Indebtedness of any Securitization Subsidiary under any Securitization
Facility (i) that is without recourse to any Company (other than such
Securitization Subsidiary) or any of their respective assets (other than
pursuant to representations, warranties, covenants and indemnities customary for
such transactions), (ii) the payment of principal and interest in respect of
which is not guaranteed by any Company, (iii) in respect of which the governing
documentation is in form and substance reasonably satisfactory to the
Administrative Agent, and (iv) that is on customary terms and conditions;
provided that the aggregate outstanding principal amount of the Indebtedness of
all Securitization Subsidiaries under all Securitization Facilities at any time
outstanding shall not exceed $300 million less the aggregate amount of
Indebtedness then outstanding under Section 6.01(m) less the aggregate book
value at the time of determination of the then outstanding Accounts subject to a
Permitted Factoring Facility at such time;
     (f) Indebtedness in respect of Purchase Money Obligations and Capital Lease
Obligations, and Permitted Refinancings thereof (other than refinancings funded
with intercompany advances), in an aggregate amount not to exceed $200 million
at any time outstanding;
     (g) Sale and Leaseback Transactions permitted under Section 6.03;
     (h) Indebtedness in respect of bid, performance or surety bonds, workers’
compensation claims, self-insurance obligations, financing of insurance
premiums, and bankers acceptances issued for the account of any Company, in each
case, incurred in the ordinary course of business (including guarantees or
obligations of any Company with respect to letters of credit supporting such
bid, performance or surety bonds, workers’ compensation claims, self-insurance
obligations and bankers acceptances) (in each case other than Indebtedness for
borrowed money);
     (i) Contingent Obligations (i) of any Loan Party in respect of Indebtedness
otherwise permitted to be incurred by such Loan Party and relating to
Indebtedness of a Loan Party under Section 6.01(f), (g), (h), (j), (l), (n) and
(r), (ii) of any Loan Party in respect of Indebtedness of Subsidiaries in an
aggregate amount not exceeding $75 million at any one time

     
 
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outstanding less all amounts paid with regard to Contingent Obligations
permitted pursuant to Section 6.04(a), and (iii) of any Company that is not a
Loan Party in respect of Indebtedness otherwise permitted to be incurred by such
Company under this Section 6.01;
     (j) Indebtedness arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument inadvertently (except in the
case of daylight overdrafts) drawn against insufficient funds in the ordinary
course of business; provided that such Indebtedness is extinguished within five
(5) Business Days of incurrence;
     (k) Indebtedness arising in connection with endorsement of instruments for
deposit in the ordinary course of business;
     (l) Unsecured Indebtedness not otherwise permitted under this Section 6.01
in an aggregate principal amount not to exceed $200 million at any time
outstanding; provided that not more than an aggregate amount of $100 million of
such Indebtedness at any time outstanding shall have a maturity or provide for
scheduled amortization of principal prior to the 180th day following the Final
Maturity Date;
     (m) Indebtedness consisting of working capital facilities, lines of credit
or cash management arrangements for Excluded Subsidiaries and Contingent
Obligations of Excluded Subsidiaries in respect thereof; provided that (i) the
aggregate principal amount of such Indebtedness incurred by NKL after the
Closing Date shall not exceed $100 million at any time outstanding and (ii) the
aggregate principal amount of such Indebtedness incurred by all other Excluded
Subsidiaries after the Closing Date shall not exceed an aggregate of
$100 million at any time outstanding;
     (n) Indebtedness in respect of indemnification obligations or obligations
in respect of purchase price adjustments or similar obligations incurred or
assumed by the Loan Parties and their Subsidiaries in connection with an Asset
Sale or sale of Equity Interests otherwise permitted under this Agreement;
     (o) unsecured guaranties in the ordinary course of business of any person
of the obligations of suppliers, customers or licensees;
     (p) Indebtedness of NKL arising under letters of credit issued in the
ordinary course of business;
     (q) (i) Indebtedness of any person existing at the time such person is
acquired in connection with a Permitted Acquisition or any other Investment
permitted under Section 6.04; provided that such Indebtedness is not incurred in
connection with or in contemplation of such Permitted Acquisition or other
Investment and is not secured by Accounts or Inventory of any Company organized
in a Principal Jurisdiction or the proceeds thereof, and at the time of such
Permitted Acquisition or other Investment, no Event of Default shall have
occurred and be continuing, and (ii) Permitted Refinancings of such
Indebtedness, in an aggregate amount, for all such Indebtedness permitted under
this clause (q), not to exceed $50 million at any time outstanding;

     
 
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     (r) Indebtedness in respect of treasury, depositary and cash management
services or automated clearinghouse transfer of funds (including the European
Cash Pooling Arrangements and other pooled account arrangements and netting
arrangements) in the ordinary course of business, in each case, arising under
the terms of customary agreements with any bank at which such Subsidiary
maintains an overdraft, pooled account or other similar facility or arrangement;
and
     (s) Permitted Holdings Indebtedness.
SECTION 6.02 Liens. Create, incur, assume or permit to exist, directly or
indirectly, any Lien on any property now owned or hereafter acquired by it or on
any income or revenues or rights in respect of any thereof, except the following
(collectively, the “Permitted Liens”):
     (a) (i) inchoate Liens for taxes, assessments or governmental charges or
levies not yet due and payable or delinquent and (ii) Liens for taxes,
assessments or governmental charges or levies, which are due and payable and are
being contested in good faith by appropriate proceedings diligently conducted
and for which adequate reserves have been provided on the books of the
appropriate Company in accordance with GAAP;
     (b) Liens in respect of property of any Company imposed by Requirements of
Law, which were incurred in the ordinary course of business and do not secure
Indebtedness for borrowed money, such as carriers’, warehousemen’s,
materialmen’s, landlords’, workmen’s, suppliers’, repairmen’s and mechanics’
Liens and other similar Liens arising in the ordinary course of business, and
(i) which do not in the aggregate materially detract from the value of the
property of the Companies, taken as a whole, and do not materially impair the
use thereof in the operation of the business of the Companies, taken as a whole,
and (ii) which, if they secure obligations that are then due and unpaid for more
than 30 days, are being contested in good faith by appropriate proceedings
diligently conducted and for which adequate reserves have been provided on the
books of the appropriate Company in accordance with GAAP;
     (c) any Lien in existence on the Closing Date and set forth on
Schedule 6.02(c) that does not attach to the Accounts and Inventory of any
Borrower and any Lien granted as a replacement, renewal or substitute therefor;
provided that any such replacement, renewal or substitute Lien (i) does not
secure an aggregate amount of Indebtedness, if any, greater than that secured on
the Closing Date (including undrawn commitments thereunder in effect on the
Closing Date, accrued and unpaid interest thereon and fees and premiums payable
in connection with a Permitted Refinancing of the Indebtedness secured by such
Lien) and (ii) does not encumber any property other than the property subject
thereto on the Closing Date (any such Lien, an “Existing Lien”);
     (d) easements, rights-of-way, restrictions (including zoning restrictions),
reservations (including pursuant to any original grant of any Real Property from
the applicable Governmental Authority), covenants, licenses, encroachments,
protrusions and other similar charges or encumbrances, and minor title
deficiencies or irregularities on or with respect to any Real Property, in each
case whether now or hereafter in existence, not (i) securing Indebtedness for
borrowed money or (ii) individually or in the aggregate materially interfering
with the ordinary conduct of the business of the Companies at such Real
Property;

     
 
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     (e) Liens arising out of judgments, attachments or awards not resulting in
an Event of Default that are being contested in good faith by appropriate
proceedings diligently conducted and for which adequate reserves have been
provided on the books of the appropriate Company in accordance with GAAP;
     (f) Liens (other than any Lien imposed by ERISA) (x) imposed by
Requirements of Law or deposits made in connection therewith in the ordinary
course of business in connection with workers’ compensation, unemployment
insurance and other types of social security legislation, (y) incurred in the
ordinary course of business to secure the performance of tenders, statutory
obligations (other than excise taxes), surety, stay, customs and appeal bonds,
statutory bonds, bids, leases, government contracts, trade contracts,
performance and return of money bonds and other similar obligations (exclusive
of obligations for the payment of borrowed money) or (z) arising by virtue of
deposits made in the ordinary course of business to secure liability for
premiums to insurance carriers; provided that (i) with respect to clauses (x),
(y) and (z) of this paragraph (f), such Liens are for amounts not yet due and
payable or delinquent or, to the extent such amounts are so due and payable,
such amounts are being contested in good faith by appropriate proceedings
diligently conducted and for which adequate reserves have been established on
the books of the appropriate Company in accordance with GAAP, and (ii) to the
extent such Liens are not imposed by Requirements of Law, such Liens shall in no
event encumber any property other than cash and Cash Equivalents and, with
respect to clause (y), property relating to the performance of obligations
secured by such bonds or instruments;
     (g) Leases, subleases or licenses of the properties of any Company granted
to other persons which do not, individually or in the aggregate, interfere in
any material respect with the ordinary conduct of the business of any Company;
     (h) Liens arising out of conditional sale, hire purchase, title retention,
consignment or similar arrangements for the sale of goods entered into by any
Company in the ordinary course of business;
     (i) Liens securing Indebtedness incurred pursuant to Section 6.01(f) or
Section 6.01(g); provided that any such Liens attach only to the property being
financed pursuant to such Indebtedness and any proceeds of such property and do
not encumber any other property of any Company;
     (j) bankers’ Liens, rights of setoff and other similar Liens existing
solely with respect to cash and Cash Equivalents on deposit in one or more
accounts maintained by any Company, in each case granted in the ordinary course
of business in favor of the bank or banks with which such accounts are
maintained, securing amounts owing to such bank with respect to treasury,
depositary and cash management services or automated clearinghouse transfer of
funds (including pooled account arrangements and netting arrangements); provided
that, unless such Liens are non-consensual and arise by operation of law, in no
case shall any such Liens secure (either directly or indirectly) the repayment
of any other Indebtedness;
     (k) Liens granted (i) pursuant to the Loan Documents to secure the Secured
Obligations or (ii) pursuant to the Revolving Credit Security Documents to
secure the “Secured

     
 
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Obligations” (as defined in the Revolving Credit Agreement) and any Permitted
Revolving Credit Facility Refinancings thereof;
     (l) licenses of Intellectual Property granted by any Company in the
ordinary course of business and not interfering in any material respect with the
ordinary conduct of business of the Companies;
     (m) the filing of UCC or PPSA financing statements (or the equivalent in
other jurisdictions) solely as a precautionary measure in connection with
operating leases or consignment of goods;
     (n) Liens on property of Excluded Subsidiaries securing Indebtedness of
Excluded Subsidiaries permitted by Section 6.01(m) and (p);
     (o) Liens securing the refinancing of any Indebtedness secured by any Lien
permitted by clauses (c), (i) or (r) of this Section 6.02 or this clause
(o) without any change in the assets subject to such Lien and to the extent such
refinanced Indebtedness is permitted by Section 6.01;
     (p) to the extent constituting a Lien, the existence of the “equal and
ratable” clause in the Senior Note Documents (and any Permitted Refinancings
thereof) (but not any security interests granted pursuant thereto);
     (q) Liens in favor of customs and revenue authorities arising as a matter
of law to secure payment of customs duties in connection with the importation of
goods in the ordinary course of business;
     (r) Liens on assets acquired in a Permitted Acquisition or on property of a
person existing at the time such person is acquired or merged with or into or
amalgamated or consolidated with any Company to the extent permitted hereunder
or such assets are acquired (and not created in anticipation or contemplation
thereof); provided that (i) such Liens do not extend to property not subject to
such Liens at the time of acquisition (other than improvements thereon and
proceeds thereof) and are no more favorable to the lienholders than such
existing Lien and (ii) the aggregate principal amount of Indebtedness secured by
such Liens does not exceed $50 million at any time outstanding;
     (s) any encumbrance or restriction (including put and call agreements)
solely in respect of the Equity Interests of any Joint Venture or Joint Venture
Subsidiary that is not a Loan Party, contained in such Joint Venture’s or Joint
Venture Subsidiary’s Organizational Documents or the joint venture agreement or
stockholders agreement in respect of such Joint Venture or Joint Venture
Subsidiary;
     (t) Liens granted in connection with Indebtedness permitted under
Section 6.01(e) that are limited in each case to the Securitization Assets
transferred or assigned pursuant to the related Securitization Facility;
     (u) Liens (which, if the same apply to any Collateral, are junior to the
Liens on the Collateral securing the Secured Obligations) not otherwise
permitted by clauses (a) through (t)

     
 
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of this Section 6.02 securing liabilities not in excess of $25 million in the
aggregate at any time outstanding;
     (v) To the extent constituting Liens, rights under purchase and sale
agreements with respect to Equity Interests permitted to be sold in Asset Sales
permitted under Section 6.06;
     (w) Liens securing obligations owing to the Loan Parties so long as such
obligations and Liens, where owing by or on assets of Loan Parties, are
subordinated to the Secured Obligations and to the Secured Parties’ Liens on the
Collateral in a manner satisfactory to the Administrative Agent; and
     (x) Liens created, arising or securing obligations under the Receivables
Purchase Agreement.
provided, however, that notwithstanding any of the foregoing, no consensual
Liens (other than Liens permitted under clause (s) and (v) above, in the case of
Securities Collateral) shall be permitted to exist, directly or indirectly, on
any Securities Collateral, other than Liens granted pursuant to the Security
Documents or the Revolving Credit Security Documents.
SECTION 6.03 Sale and Leaseback Transactions. Enter into any arrangement,
directly or indirectly, with any person whereby it shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property
which it intends to use for substantially the same purpose or purposes as the
property being sold or transferred (a “Sale and Leaseback Transaction”) unless
(i) the sale of such property is permitted by Section 6.06, (ii) any Liens
arising in connection with its use of such property are permitted by
Section 6.02 and (iii) after giving effect to such Sale and Leaseback
Transaction, (A) in the case of NKL, the aggregate fair market value of all
properties covered by Sale and Leaseback Transactions entered into by NKL would
not exceed $200 million and (B) in the case of Holdings or any other Subsidiary
of Holdings, the aggregate fair market value of all properties covered by Sale
and Leaseback Transactions entered into by all such persons would not exceed
$100 million.
SECTION 6.04 Investments, Loan and Advances. Directly or indirectly, lend money
or credit (by way of guarantee or otherwise) or make advances to any person, or
purchase or acquire any stock, bonds, notes, debentures or other obligations or
securities of, or any other ownership interest in, or make any capital
contribution to, any other person, or purchase or otherwise acquire (in one
transaction or a series of transactions) all or substantially all of the
property and assets or business of any other person or assets constituting a
business unit, line of business or division of any other person, or purchase or
own a futures contract or otherwise become liable for the purchase or sale of
currency or other commodities at a future date in the nature of a futures
contract (all of the foregoing, collectively, “Investments”; it being understood
that the amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such Investment
and when determining the amount of an Investment that remains outstanding, the
last paragraph of this Section 6.04 shall apply), except that the following
shall be permitted:

     
 
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     (a) Investments consisting of unsecured guaranties of, or other unsecured
Contingent Obligations with respect to, operating payments not constituting
Indebtedness for borrowed money incurred by Subsidiaries that are not Loan
Parties, in the ordinary course of business, that, to the extent paid, shall not
exceed an aggregate amount equal to $75 million less the amount of Contingent
Obligations by Loan Parties in respect of Companies that are not Loan Parties
permitted pursuant to Section 6.01(i)(ii);
     (b) Investments outstanding on the Closing Date and identified on
Schedule 6.04(b);
     (c) the Companies may (i) acquire and hold accounts receivable owing to any
of them if created or acquired in the ordinary course of business or in
connection with a Permitted Acquisition, (ii) invest in, acquire and hold cash
and Cash Equivalents, (iii) endorse negotiable instruments held for collection
in the ordinary course of business or (iv) make lease, utility and other similar
deposits in the ordinary course of business;
     (d) Investments in Securitization Subsidiaries in connection with
Securitization Facilities permitted by Section 6.01(e);
     (e) the Loan Parties and their Subsidiaries may make loans and advances
(including payroll, travel and entertainment related advances) in the ordinary
course of business to their respective employees (other than any loans or
advances to any director or executive officer (or equivalent thereof) that would
be in violation of Section 402 of the Sarbanes-Oxley Act) so long as the
aggregate principal amount thereof at any time outstanding (determined without
regard to any write-downs or write-offs of such loans and advances) shall not
exceed (when aggregated with loans and advances outstanding pursuant to clause
(h) below) $15 million;
     (f) any Company may enter into Hedging Agreements to the extent permitted
by Section 6.01(c);
     (g) Investments made by any Company as a result of consideration received
in connection with an Asset Sale made in compliance with Section 6.06;
     (h) loans and advances to directors, employees and officers of the Loan
Parties and their Subsidiaries for bona fide business purposes, in aggregate
amount not to exceed (when aggregated with loans and advances outstanding
pursuant to clause (e) above) $15 million at any time outstanding; provided that
no loans in violation of Section 402 of the Sarbanes-Oxley Act shall be
permitted hereunder;
     (i) Investments (i) by any Company in any other Company outstanding on the
Closing Date and Investments made on or about the Closing Date in connection
with the Receivables Purchase Agreement, (ii) by any Company in any Unrestricted
Grantor, (iii) by any Restricted Grantor in any other Restricted Grantor,
(iv) by an Unrestricted Grantor in any Restricted Grantor up to an aggregate
amount made after the Closing Date of $50 million in the aggregate at any one
time outstanding and (v) by any Company that is not a Loan Party in any other
Company; provided that any such Investment in the form of a loan or advance to
any Loan Party shall be subordinated to the Secured Obligations on terms
reasonably satisfactory to the Administrative Agent and, in the case of a loan
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an Intercompany Note and pledged by such Loan Party as Collateral pursuant to
the Security Documents;
     (j) Investments in securities or other obligations received upon
foreclosure or pursuant to any plan of reorganization or liquidation or similar
arrangement upon the bankruptcy or insolvency of trade creditors or customers or
in connection with the settlement of delinquent accounts in the ordinary course
of business, and Investments received in good faith in settlement of disputes or
litigation;
     (k) Investments in Joint Ventures in which the Loan Parties hold at least
50% of the outstanding Equity Interests or Joint Venture Subsidiaries made with
the Net Cash Proceeds of Asset Sales made in accordance with Section 6.06(k);
     (l) Investments in Norf GmbH for purposes of making Capital Expenditures in
an aggregate amount not to exceed $10 million during any Fiscal Year;
     (m) Permitted Acquisitions; provided that the Lien on and security interest
in such Investment granted or to be granted in favor of the Collateral Agent
under the Security Documents shall be maintained or created in accordance with
the provisions of Section 5.11 or Section 5.12, as applicable;
     (n) [INTENTIONALLY OMITTED];
     (o) Mergers, amalgamations and consolidations in compliance with
Section 6.05; provided that the Lien on and security interest in such Investment
granted or to be granted in favor of the Collateral Agent under the Security
Documents shall be maintained or created in accordance with the provisions of
Section 5.11 or Section 5.12, as applicable;
     (p) Investments in respect of European Cash Pooling Arrangements, subject
to the limitations set forth in Section 6.07;
     (q) Investments consisting of guarantees of Indebtedness referred to in
clauses (i) (to the extent such guarantee is in effect on the Closing Date or
permitted as part of a Permitted Refinancing), (ii) and (iii) of Section 6.01(b)
and Contingent Obligations permitted by Section 6.01(i); and
     (r) other Investments in an aggregate amount not to exceed $200 million at
any time outstanding; provided that any such Investment in the form of a loan or
advance to any Loan Party shall be subordinated to the Secured Obligations on
terms reasonably satisfactory to the Administrative Agent and, in the case of a
loan or advance by a Loan Party, evidenced by an Intercompany Note and pledged
by such Loan Party as Collateral pursuant to the Security Documents.
An Investment shall be deemed to be outstanding to the extent not returned in
the same form as the original Investment to any Company. The outstanding amount
of an Investment shall, in the case of a Contingent Obligation that has been
terminated, be reduced to the extent no payment is or was made with respect to
such Contingent Obligation upon or prior to the termination of such Contingent
Obligation; and the outstanding amount of other Investments shall be reduced by
the

     
 
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amount of cash or Cash Equivalents received with respect to such Investment upon
the sale or disposition thereof, or constituting a return of capital with
respect thereto or, repayment of the principal amount thereof, in the case of a
loan or advance.
SECTION 6.05 Mergers, Amalgamations and Consolidations. Wind up, liquidate or
dissolve its affairs or enter into any transaction of merger, amalgamation or
consolidation (or agree to do any of the foregoing at any future time), except
that the following shall be permitted:
     (a) Asset Sales in compliance with Section 6.06;
     (b) Permitted Acquisitions in compliance with Section 6.04;
     (c) (i) any Company may merge, amalgamate or consolidate with or into any
Unrestricted Grantor (provided that (A) in the case of any merger, amalgamation
or consolidation involving a Borrower, a Borrower is the surviving or resulting
person, and in any other case, an Unrestricted Grantor is the surviving or
resulting person, (B) no Borrower shall merge, amalgamate or consolidate with or
into any other Borrower, (C) in the case of any merger, amalgamation or
consolidation involving Canadian Borrower, the surviving or resulting Borrower
is organized under the laws of Canada or the United States (or any state thereof
or the District of Columbia) and (D) in the case of any merger or consolidation
involving the U.S. Borrower, the surviving Borrower is organized under the laws
of the United States (or any state thereof or the District of Columbia)),
(ii) any Restricted Grantor may merge, amalgamate or consolidate with or into
any other Restricted Grantor organized under the laws of the same country (or
any jurisdiction within such same country) (provided that a Subsidiary Guarantor
is the surviving or resulting person), and (iii) any Company that is not a Loan
Party may merge, amalgamate or consolidate with or into any Restricted Grantor
(provided that a Subsidiary Guarantor is the surviving or resulting person);
provided that, in the case of each of the foregoing clauses (i) through (iii),
(1) the surviving or resulting person is a Wholly Owned Subsidiary of Holdings,
(2) the Lien on and security interest in such property granted or to be granted
in favor of the Collateral Agent under the Security Documents shall be
maintained in full force and effect and perfected and enforceable (to at least
the same extent as in effect immediately prior to such transfer) or created in
accordance with the provisions of Section 5.11 or Section 5.12, as applicable
and (3) no Default is then continuing or would result therefrom; provided that
in the case of any amalgamation or consolidation involving a Loan Party, at the
request of the Administrative Agent, such Loan Party and each other Loan Party
shall confirm its respective Secured Obligations and Liens under the Loan
Documents in a manner reasonably satisfactory to the Administrative Agent;
     (d) any Subsidiary that is not a Loan Party may merge, amalgamate or
consolidate with or into any other Subsidiary that is not a Loan Party;
     (e) Holdings and Canadian Borrower may consummate the Permitted Holdings
Amalgamation;
     (f) any Subsidiary (other than any Borrower) may dissolve, liquidate or
wind up its affairs at any time; provided that such dissolution, liquidation or
winding up, as applicable, could not reasonably be expected to have a Material
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     (g) any Unrestricted Grantor (other than a Borrower) may dissolve,
liquidate or wind-up its affairs (collectively, “Wind-Up”), so long as all of
its assets are distributed or otherwise transferred to an Unrestricted Grantor
organized under the laws of the same jurisdiction as the Unrestricted Grantor
Winding-Up its affairs and any Restricted Grantor may Wind-Up so long as all of
its assets are distributed or otherwise transferred to a Restricted Grantor or
an Unrestricted Grantor organized under the laws of the same jurisdiction as the
Restricted Grantor Winding-Up its affairs; provided that (1) the Lien on and
security interest in such property granted or to be granted in favor of the
Collateral Agent under the Security Documents shall be maintained in full force
and effect and perfected and enforceable (to at least the same extent as in
effect immediately prior to such transfer) or created in accordance with the
provisions of Section 5.11 or Section 5.12, as applicable and (2) no Default is
then continuing or would result therefrom.
     To the extent the Required Lenders or such other number of Lenders whose
consent is required under Section 11.02, as applicable, waive the provisions of
this Section 6.05 with respect to the sale of any Collateral, or any Collateral
is sold as permitted by this Section 6.05, and so long as the Lien of the
Revolving Credit Funding Agent or the Revolving Credit Collateral Agent (or any
other Revolving Credit Agents) pursuant to the Revolving Credit Loan Documents
in such Collateral is also released, such Collateral (unless sold to a Loan
Party) shall be sold free and clear of the Liens created by the Security
Documents, and so long as Borrowers shall have provided the Agents with such
certifications or documents as any Agent shall reasonably request in order to
demonstrate compliance with this Section 6.05, and the Agents shall take all
actions as Administrative Borrower reasonably requests in order to effect the
foregoing.
SECTION 6.06 Asset Sales. Effect any Asset Sale, or agree to effect any Asset
Sale, except that the following shall be permitted:
     (a) disposition of used, worn out, obsolete or surplus property by any
Company in the ordinary course of business and the abandonment or other
disposition of Intellectual Property that is, in the reasonable judgment of
Borrowers, no longer economically practicable to maintain or useful in the
conduct of the business of the Companies taken as a whole;
     (b) so long as no Default is then continuing or would result therefrom, any
other Asset Sale (other than the Equity Interests of any Wholly Owned Subsidiary
unless all of the Equity Interests of such Subsidiary then owned by any of the
Companies are sold to the purchaser thereof in a sale permitted by this clause
(b)) for fair market value, with at least 80% of the consideration received for
all such Asset Sales payable in cash upon such sale; provided, however, that
with respect to any such Asset Sale pursuant to this clause (b), the aggregate
consideration received during any fiscal year for all such Asset Sales shall not
exceed $150 million;
     (c) leases, subleases or licenses of the properties of any Company in the
ordinary course of business and which do not, individually or in the aggregate,
interfere in any material respect with the ordinary conduct of the business of
any Company;
 

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     (d) mergers and consolidations, and liquidations and dissolutions in
compliance with Section 6.05;
     (e) sales, transfers and other dispositions of Accounts for the fair market
value thereof in connection with a Permitted Factoring Facility so long as at
any time of determination the aggregate book value of the then outstanding
Accounts subject to a Permitted Factoring Facility does not exceed an amount
equal to $300 million less the amount of Indebtedness under all outstanding
Securitization Facilities at such time less the amount of Indebtedness
outstanding under Section 6.01(m) at such time;
     (f) the sale or disposition of cash and Cash Equivalents in connection with
a transaction otherwise permitted under the terms of this Agreement;
     (g) assignments and licenses of intellectual property of any Loan Party and
its Subsidiaries in the ordinary course of business and which do not,
individually or in the aggregate, interfere in any material respect with the
ordinary conduct of the business of any Company;
     (h) Asset Sales (other than the Equity Interests of any Subsidiary unless
all of the Equity Interests of such Subsidiary then owned by any of the
Companies are sold to the purchaser thereof in a sale permitted by this clause
(h)) (i) by and among Unrestricted Grantors (other than Holdings), (ii) by and
among Restricted Grantors organized under the laws of the same country (or
jurisdictions within such same country), (iii) by Restricted Grantors to
Unrestricted Grantors so long as the consideration paid by Unrestricted Grantors
in each such Asset Sale does not exceed fair market value for such Asset Sale,
(iv) by Unrestricted Grantors to Restricted Grantors of property for fair market
value, and for aggregate consideration, not in excess of $25 million for all
such Asset Sales following the Closing Date, (v) by Companies that are not Loan
Parties to Loan Parties so long as the consideration paid by Loan Parties in
each such Asset Sale does not exceed (1) the fair market value for such Asset
Sale and (2) $25 million for all such Asset Sales following the Closing Date;
and (vi) by and among Companies that are not Loan Parties; provided that (A) in
the case of any transfer from one Loan Party to another Loan Party, any security
interests granted to the Collateral Agent for the benefit of any Secured Parties
pursuant to the relevant Security Documents in the assets so transferred shall
(1) remain in full force and effect and perfected and enforceable (to at least
the same extent as in effect immediately prior to such transfer) or (2) be
replaced by security interests granted to the relevant Collateral Agent for the
benefit of the relevant Secured Parties pursuant to the relevant Security
Documents, which new security interests shall be in full force and effect and
perfected and enforceable (to at least the same extent as in effect immediately
prior to such transfer) and (B) no Default is then continuing or would result
therefrom;
     (i) the Companies may consummate Asset Swaps (other than Asset Swaps
constituting all or substantially all of the asset of a Company), so long as
(x) each such sale is in an arm’s-length transaction and the applicable Company
receives at least fair market value consideration (as determined in good faith
by such Company), (y) the Collateral Agent shall have a First Priority perfected
Lien on the assets acquired pursuant to such Asset Swap at least to the same
extent as the assets sold pursuant to such Asset Swap (immediately prior to
giving effect thereto) and (z) the aggregate fair market value of all assets
sold pursuant to this clause
 

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(i) shall not exceed $25 million in the aggregate since the Closing Date;
provided that so long as the assets acquired by any Company pursuant to the
respective Asset Swap are located in the same country as the assets sold by such
Company, such $25 million aggregate cap will not apply to such Asset Swap;
     (j) sales, transfers and other dispositions of Receivables and Related
Security to a Securitization Subsidiary for the fair market value thereof and
all sales, transfers or other dispositions of Securitization Assets by a
Securitization Subsidiary under, and pursuant to, a related Securitization
Facility permitted under Section 6.01(e);
     (k) so long as no Default is then continuing or would result therefrom, the
arm’s-length sale or disposition for cash of Equity Interests in a Joint Venture
Subsidiary for fair market value or the issuance of Equity Interests in a Joint
Venture Subsidiary; provided, however, that the aggregate fair market value of
all such Equity Interests sold or otherwise disposed of pursuant to this clause
(k) following the Closing Date shall not exceed $300 million; and
     (l) issuances of Equity Interests permitted under Section 6.13(b)(i), (ii),
(iii), (iv) and (vi).
     To the extent the Required Lenders or such other number of Lenders whose
consent is required under Section 11.02, as applicable, waive the provisions of
this Section 6.06 with respect to the sale of any Collateral or any Collateral
is sold as permitted by this Section 6.06, and so long as the Lien of the
Revolving Credit Funding Agent or the Revolving Credit Collateral Agent (or any
other Revolving Credit Agents) pursuant to the Revolving Credit Loan Documents
in such Collateral is also released, such Collateral (unless sold to a Loan
Party) shall be sold free and clear of the Liens created by the Security
Documents, and so long as the Loan Parties shall have provided the Agents such
certificates or documents as any Agent shall reasonably request in order to
demonstrate compliance with this Section 6.06, the Agents shall take all actions
as Administrative Borrower reasonably requests in order to effect the foregoing.
SECTION 6.07 European Cash Pooling Arrangements. Amend, vary or waive any term
of the European Cash Pooling Arrangements without express written consent of the
Administrative Agent, or enter into any new pooled account or netting agreement
with any Affiliate without express written consent of the Administrative Agent.
Permit the aggregate amount owed pursuant to the European Cash Pooling
Arrangements by all Companies who are not Loan Parties minus the aggregate
amount on deposit pursuant to the European Cash Pooling Arrangements from such
Persons to exceed $30 million.
SECTION 6.08 Dividends. Authorize, declare or pay, directly or indirectly, any
Dividends with respect to any Company, except that the following shall be
permitted:
     (a) (i) Dividends by any Company to any Loan Party that is a Wholly Owned
Subsidiary of Holdings, (ii) Dividends by Holdings payable solely in Qualified
Capital Stock and (iii) Dividends by Holdings payable with the proceeds of
Permitted Holdings Indebtedness;
 

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     (b) (i) Dividends by any Company that is not a Loan Party to any other
Company that is not a Loan Party but is a Wholly Owned Subsidiary of Holdings
and (ii) cash Dividends by any Company that is not a Loan Party to the holders
of its Equity Interests on a pro rata basis;
     (c) (A) to the extent actually used by Holdings to pay such franchise
taxes, costs and expenses, payments by Borrowers to or on behalf of Holdings in
an amount sufficient to pay franchise taxes and other fees solely required to
maintain the legal existence of Holdings and (B) payments by Borrowers to or on
behalf of Holdings in an amount sufficient to pay out-of-pocket legal,
accounting and filing costs and other expenses in the nature of overhead in the
ordinary course of business of Holdings, in the case of clauses (A) and (B) in
an aggregate amount not to exceed $5 million in any fiscal year;
     (d) Beginning with the fiscal year of Canadian Borrower commencing in 2009,
Canadian Borrower may pay cash Dividends to Holdings the proceeds of which may
be utilized by Holdings to pay cash Dividends to the holders of its Equity
Interests (or to repay Subordinated Debt Loans) in an amount declared and paid
in any fiscal year of Canadian Borrower not to exceed 50% of Consolidated Net
Income for the previous fiscal year of Canadian Borrower (beginning with the
first complete fiscal year commencing after the Closing Date) (such amount for
any such fiscal year, determined after giving effect to clause (ii) below, the
“CNI Basket”) less the aggregate amount of any repayments or redemptions of
Indebtedness under the Senior Note Documents (or any Permitted Refinancings of
any of such Indebtedness) made out of the CNI Basket for such fiscal year
pursuant to clause (z) of Section 6.11(a); provided that (i) the Dividends
described in this clause (d) shall not be permitted if a Default is continuing
at the date of declaration or payment thereof or would result therefrom and
(ii) Consolidated Net Income shall be calculated for purposes of this clause
(d) and for purposes of Section 6.11 without giving effect to non-cash after-tax
gains and losses resulting from the mark-to-market of any Hedging Agreement in
accordance with the Statement of Financial Accounting Standards No. 133 or
non-cash after-tax gains or losses relating to any balance sheet translation in
accordance with the Statement of Financial Accounting Standards No. 52 and, in
either case, assuming an applicable tax rate equal to 35%; and
     (e) to the extent constituting a Dividend, payments permitted by
Section 6.09(d) that do not relate to Equity Interests.
SECTION 6.09 Transactions with Affiliates. Enter into, directly or indirectly,
any transaction or series of related transactions, whether or not in the
ordinary course of business, with or for the benefit of any Affiliate of any
Company (other than between or among Loan Parties), other than on terms and
conditions at least as favorable to such Company as would reasonably be obtained
by such Company at that time in a comparable arm’s-length transaction with a
person other than an Affiliate, except that the following shall be permitted:
     (a) Dividends permitted by Section 6.08;
     (b) Investments permitted by Section 6.04(d), (e), (h), (i) or (l);
 

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     (c) mergers, amalgamations and consolidations permitted by Section 6.05(c),
(d), (e), (f) or (g), Asset Sales permitted by Section 6.06(h) and issuances of
Equity Interests by Holdings or among Loan Parties, in each case, to the extent
permitted by Section 6.13(b);
     (d) reasonable and customary director, officer and employee compensation
(including bonuses) and other benefits (including retirement, health, stock
option and other benefit plans) and indemnification arrangements, in each case
approved by the Board of Directors of Canadian Borrower;
     (e) transactions with customers, clients, suppliers, joint venture partners
or purchasers or sellers of goods and services, in each case in the ordinary
course of business and otherwise not prohibited by the Loan Documents;
     (f) the existence of, and the performance by any Company of its obligations
under the terms of, any limited liability company, limited partnership or other
Organizational Document or securityholders agreement (including any registration
rights agreement or purchase agreement related thereto) to which it is a party
on the Closing Date and which has been disclosed in writing to the
Administrative Agent as in effect on the Closing Date, and similar agreements
that it may enter into thereafter, to the extent not more adverse to the
interests of the Lenders in any material respect, when taken as a whole, than
any of such documents and agreements as in effect on the Closing Date;
     (g) the Transactions as contemplated by the Transaction Documents;
     (h) Securitization Facilities permitted under Section 6.01(e) and
transactions in connection therewith on a basis no less favorable to the
applicable Company as would be obtained in a comparable arm’s length transaction
with a person not an Affiliate thereof;
     (i) cash management netting and pooled account arrangements permitted under
Section 6.01(r);
     (j) transactions between or among any Companies that are not Loan Parties;
     (k) transactions between Loan Parties and Companies that are not Loan
Parties that are at least as favorable to each such Loan Party as would
reasonably be obtained by such Loan Party in a comparable arm’s-length
transaction with a person other than an Affiliate; and
     (l) transactions contemplated by the Receivables Purchase Agreement;
provided that notwithstanding any of the foregoing or any other provision of
this Agreement, all intercompany loans, advances or other extensions of credit
made to or by Companies organized in Switzerland shall be on fair market terms.
SECTION 6.10 [INTENTIONALLY OMITTED].
SECTION 6.11 Prepayments of Other Indebtedness; Modifications of Organizational
Documents and Other Documents, etc. Directly or indirectly:

     
 
   

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     (a) (i) make any voluntary or optional payment of principal on or
prepayment on or redemption or acquisition for value of, or complete any
mandatory prepayment, redemption or purchase offer in respect of, or otherwise
voluntarily or optionally defease or segregate funds with respect to, any
Indebtedness under the Senior Note Documents or any Subordinated Indebtedness
(including the Subordinated Debt Loan and any Additional Subordinated Debt Loan
but excluding any Subordinated Indebtedness wholly among Loan Parties) or any
Permitted Refinancings of any of such Indebtedness, except (v) the Subordinated
Debt Loan may be repaid with the proceeds of Permitted Holdings Indebtedness,
(w) Indebtedness under the Senior Note Documents may be repaid or redeemed with
the proceeds of Incremental Term Loans, (x) with the proceeds of a Permitted
Refinancing of such Indebtedness, (y) redemptions of the Senior Notes required
under the terms of Senior Note Documents pursuant to Section 4.17 of the Senior
Note Agreement (as in effect on the Closing Date) as a result of the Hindalco
Acquisition and (z) beginning in 2009, and so long as no Default is continuing
or would result therefrom, repayments or redemptions of Indebtedness under the
Senior Notes Documents (or any Permitted Refinancings (other than a refinancing
with Incremental Term Loans) of any of such Indebtedness) in an aggregate amount
not to exceed the CNI Basket for the previous fiscal year of Canadian Borrower
(beginning with the first complete fiscal year commencing after the Closing
Date) less the aggregate amount of any cash Dividends paid out of the CNI Basket
for such fiscal year pursuant to Section 6.08(d), (ii) make any payment on or
with respect to any Subordinated Indebtedness wholly among Loan Parties in
violation of the Subordination provisions thereof or (iii) make any payment
(whether, voluntary, mandatory, scheduled or otherwise) on or with respect to
any Subordinated Indebtedness (including payments of principal and interest
thereon, but excluding the discharge or release by Novelis AG (as consideration
for the purchase of receivables under the Receivables Purchase Agreement) of
loans or advances made by Novelis AG to German Seller) if an Event of Default is
continuing or would result therefrom;
     (b) [INTENTIONALLY OMITTED];
     (c) amend or modify, or permit the amendment or modification of, any
provision of any document governing any Material Indebtedness (other than
Indebtedness under the Loan Documents or Revolving Credit Loan Documents (or any
Permitted Revolving Credit Facility Refinancings thereof) and Indebtedness of
NKL permitted under Section 6.01(m) or listed on Schedule 6.01) in any manner
that, taken as a whole, is adverse in any material respect to the interests of
the Lenders;
     (d) amend or modify, or permit the amendment or modification of, any
provision of any document governing any Indebtedness under the Revolving Credit
Loan Documents (or any Permitted Revolving Credit Facility Refinancings thereof)
if such amendment or modification would (i) cause the aggregate principal amount
(or accreted value, if applicable) of all such Indebtedness, after giving effect
to such amendment or modification, to at any time exceed the Maximum Revolving
Credit Facility Amount, (ii) cause the “Applicable Margin” or similar component
of the interest rate or yield provisions applicable to such Indebtedness, after
giving effect to such amendment or modification, to be increased from the
highest “Applicable Margin” set forth in the Revolving Credit Loan Documents as
of the Closing Date by more than 3% per annum (excluding increases resulting
from the accrual of interest at the default rate specified in the Revolving
Credit Agreement), (iii) cause such Indebtedness to have a final
 

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maturity date earlier than the final maturity date of such Indebtedness
immediately prior to such amendment or modification or (iv) result in the
persons that are (or are required to be) obligors under such Indebtedness to be
different from the persons that are (or are required to be) obligors under such
Indebtedness being so amended or modified (unless such persons required to be
obligors under such Indebtedness are or are required to be or become obligors
under the Loan Documents); and provided that prior to the effectiveness of such
amendment or modification, a Responsible Officer of Administrative Borrower
shall have delivered an Officers’ Certificate to the Administrative Agent
(together with a reasonably detailed description of the material terms and
conditions of such amendment or modification or drafts of the documentation
relating thereto) certifying that Administrative Borrower has determined in good
faith that such terms and conditions satisfy the foregoing requirements;
     (e) terminate, amend or modify any of its Organizational Documents
(including (x) by the filing or modification of any certificate of designation
and (y) any election to treat any Pledged Securities (as defined in the Security
Agreement) as a “security” under Section 8-103 of the UCC other than
concurrently with the delivery of certificates representing such Pledged
Securities to the Collateral Agent) or any agreement to which it is a party with
respect to its Equity Interests (including any stockholders’ agreement), or
enter into any new agreement with respect to its Equity Interests, other than
any such amendments or modifications or such new agreements which are not
adverse in any material respect to the interests of the Lenders;
     (f) amend or modify, or grant any consents, waivers or approvals with
respect to, or permit the amendment or modification of, or granting of any
consents, waivers or approvals with respect to, the Receivables Purchase
Agreement, without the consent of the Administrative Agent; or
     (g) amend or modify, or permit the amendment or modification of, any
provision of any document governing any Subordinated Debt Loan or Additional
Subordinated Debt Loan in any manner except as consented to by the
Administrative Agent in connection with the Permitted Holdings Amalgamation and
except in a manner that is not adverse in any respect to the Lenders and
consented to by the Administrative Agent or in connection with increasing the
Subordinated Debt Loan pursuant to an Additional Subordinated Debt Loan.
SECTION 6.12 Limitation on Certain Restrictions on Subsidiaries. Directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Subsidiary of Canadian Borrower
to (a) pay dividends or make any other distributions on its capital stock or any
other interest or participation in its profits owned by Canadian Borrower or any
Subsidiary of Canadian Borrower, or pay any Indebtedness owed to Canadian
Borrower or a Subsidiary of Canadian Borrower, (b) make loans or advances to
Canadian Borrower or any Subsidiary of Canadian Borrower or (c) transfer any of
its properties to Canadian Borrower or any Subsidiary of Canadian Borrower,
except for such encumbrances or restrictions existing under or by reason of
(i) applicable Requirements of Law; (ii) this Agreement and the other Loan
Documents; (iii) the Senior Note Documents and the Revolving Credit Loan
Documents or other Material Indebtedness; provided that in the case of such
other Material Indebtedness, such encumbrances and restrictions are, taken as a
whole, no more restrictive than such encumbrances and restrictions in the Loan
Documents in existence on the Closing Date; (iv) customary provisions
restricting subletting or assignment of any lease
 

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governing a leasehold interest of a Company; (v) customary provisions
restricting assignment of any agreement entered into by a Subsidiary of Canadian
Borrower; (vi) any holder of a Lien permitted by Section 6.02 restricting the
transfer of the property subject thereto; (vii) customary restrictions and
conditions contained in any agreement relating to the sale of any property
permitted under Section 6.06 pending the consummation of such sale; (viii) any
agreement in effect at the time such Subsidiary of Canadian Borrower becomes a
Subsidiary of Canadian Borrower, so long as such agreement was not entered into
in connection with or in contemplation of such person becoming a Subsidiary of
Canadian Borrower; (ix) without affecting the Loan Parties’ obligations under
Section 5.11, customary provisions in partnership agreements, shareholders’
agreements, joint venture agreements, limited liability company organizational
governance documents and other Organizational Documents, entered into in the
ordinary course of business (or in connection with the formation of such
partnership, joint venture, limited liability company or similar person) that
(A) restrict the transfer of Equity Interests in such partnership, joint
venture, limited liability company or similar person or (B) the case of any
Joint Venture or Joint Venture Subsidiary that is not a Loan Party, provide for
other restrictions of the type described in clauses (a), (b) and (c) above,
solely with respect to the Equity Interests in, or property held in, such joint
venture, and customary provisions in asset sale and stock sale agreements and
other similar agreements permitted hereunder that provide for restrictions of
the type described in clauses (a), (b) and (c) above, solely with respect to the
assets or persons subject to such sale agreements; (x) restrictions on cash or
other deposits or net worth imposed by suppliers or landlords under contracts
entered into in the ordinary course of business; (xi) any instrument governing
Indebtedness assumed in connection with any Permitted Acquisition, which
encumbrance or restriction is not applicable to any person, or the properties or
assets of any person, other than the person or the properties or assets of the
person so acquired; or (xii) any encumbrances or restrictions imposed by any
amendments or refinancings that are otherwise not prohibited by the Loan
Documents of the contracts, instruments or obligations referred to in clauses
(iii), (viii) or (xi) above; provided that such amendments or refinancings are
no more materially restrictive with respect to such encumbrances and
restrictions than those prior to such amendment or refinancing.
SECTION 6.13 Limitation on Issuance of Capital Stock.
     (a) Except as permitted by clause (b)(vi) below, issue any Equity Interest
that is not Qualified Capital Stock.
     (b) Issue any Equity Interest (including by way of sales of treasury stock)
or any options or warrants to purchase, or securities convertible into, any
Equity Interest, except (i) for stock splits, stock dividends and additional
issuances of Equity Interests which do not decrease the percentage ownership of
any of the Loan Parties in any class of the Equity Interests of such issuing
Company or issuances of Equity Interests in Joint Venture Subsidiaries in
connection with the creation thereof; (ii) Subsidiaries of Canadian Borrower
formed after the Closing Date in accordance with Section 6.14 may issue Equity
Interests to Canadian Borrower or the Subsidiary of Canadian Borrower which is
to own such Equity Interests; (iii) Canadian Borrower may issue common stock
that is Qualified Capital Stock to Holdings; (iv) Holdings may issue Equity
Interests that are Qualified Capital Stock; (v) any Company that is not a direct
or indirect Wholly Owned Subsidiary of Holdings may issue Qualified Capital
Stock to the extent such issuance would be a permitted Asset Sale under

     
 
   

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Section 6.06; and (vi) Joint Venture Subsidiaries may issue Preferred Stock or
Disqualified Capital Stock. All Equity Interests issued in accordance with this
Section 6.13(b) shall, to the extent required by Section 5.11 or any Security
Document or if such Equity Interests are issued by any Loan Party (other than
Holdings), be delivered to the Collateral Agent for pledge pursuant to the
applicable Security Agreement.
SECTION 6.14 Limitation on Creation of Subsidiaries. Establish, create or
acquire any additional Subsidiaries without the prior written consent of the
Required Lenders; provided that, without such consent, Loan Parties may (i)
establish or create one or more Wholly Owned Subsidiaries of Holdings or
(ii) establish, create or acquire one or more Subsidiaries in connection with an
Investment made pursuant to Section 6.04(d), (k), (m), (o) or (p), so long as,
in each case, Section 5.11(b) shall be complied with.
SECTION 6.15 Business.
     (a) Each of Holdings, Novelis Europe Holdings Limited and Eurofoil shall
not engage in any business or activity other than (i) holding shares in the
Equity Interests of its Subsidiaries, (ii) holding intercompany loans made to
Canadian Borrower, (iii) other activities attributable to or ancillary to its
role as a holding company for its Subsidiaries and (iv) compliance with its
obligations under the Loan Documents, the Term Loan Documents (and any Permitted
Term Loan Facility Refinancings thereof), and the Senior Note Documents (and any
Permitted Refinancings thereof).
     (b) With respect to Borrower and the Subsidiaries, engage (directly or
indirectly) in any business other than those businesses in which Borrower and
its Subsidiaries are engaged on the Closing Date as described in the
Confidential Information Memorandum (or, in the good faith judgment of the Board
of Directors, which are substantially related thereto or are reasonable
extensions thereof).
     (c) Permit any Securitization Subsidiary to engage in any business or
activity other than performing its obligations under the related Securitization
Facility.
SECTION 6.16 Limitation on Accounting Changes. Make or permit any change in
accounting policies or reporting practices or tax reporting treatment, except
changes that are permitted by GAAP or any Requirement of Law and disclosed to
the Administrative Agent.
SECTION 6.17 Fiscal Year. Change its fiscal year-end to a date other than
March 31.
SECTION 6.18 Lease Obligations. Create, incur, assume or suffer to exist any
obligations as lessee for the rental or hire of real or personal property of any
kind under leases or agreements to lease (other than Capital Lease Obligations
permitted under Section 6.01(f)) having an original term of one year or more
that would cause the aggregate amount of rent paid or reserved in respect of all
such obligations to exceed $25 million payable in any fiscal year of Canadian
Borrower.
SECTION 6.19 No Further Negative Pledge. Enter into or suffer to exist any
consensual agreement, instrument, deed or lease which prohibits or limits the
ability of any Loan Party to create, incur, assume or suffer to exist any Lien
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or revenues, whether now owned or hereafter acquired to secure the Secured
Obligations, or which requires the grant of any security for an obligation if
security is granted to secure the Secured Obligations, except the following: (1)
this Agreement and the other Loan Documents; (2) covenants in documents creating
Liens permitted by Section 6.02 prohibiting further Liens on the properties
encumbered thereby; (3) the Senior Note Documents and the Revolving Credit Loan
Documents; and (4) any prohibition or limitation that (a) exists pursuant to
applicable Requirements of Law, (b) consists of customary restrictions and
conditions contained in any agreement relating to the sale of any property
permitted under Section 6.06 pending the consummation of such sale,
(c) restricts subletting or assignment of any lease governing a leasehold
interest of a Loan Party or a Subsidiary, (d) is permitted under
Section 6.02(s), (e) exists in any agreement or other instrument of a person
acquired in an Investment permitted hereunder in existence at the time of such
Investment (but not created in connection therewith or in contemplation
thereof), which prohibition or limitation is not applicable to any person, or
the properties or assets of any person, other than the person, or the property
or assets of the person so acquired, (f) is contained in any joint venture,
shareholders agreement, limited liability operating agreement or other
Organizational Document governing a Joint Venture or Joint Venture Subsidiary
which limits the ability of an owner of an interest in a Joint Venture or Joint
Venture Subsidiary from encumbering its ownership interest therein or (g) is
imposed by any amendments or refinancings that are otherwise permitted by the
Loan Documents of the contracts, instruments or obligations referred to in
clause (3) or (4)(e); provided that such amendments and refinancings are no more
materially restrictive with respect to such prohibitions and limitations than
those prior to such amendment or refinancing.
SECTION 6.20 Anti-Terrorism Law; Anti-Money Laundering.
     (a) Directly or indirectly, (i) knowingly conduct any business or engage in
making or receiving any contribution of funds, goods or services to or for the
benefit of any person described in Section 3.22, (ii) knowingly deal in, or
otherwise engage in any transaction relating to, any property or interests in
property blocked pursuant to the Executive Order or any other Anti-Terrorism
Law, or (iii) knowingly engage in or conspire to engage in any transaction that
evades or avoids, or has the purpose of evading or avoiding, or attempts to
violate, any of the prohibitions set forth in any Anti-Terrorism Law (and the
Loan Parties shall deliver to the Lenders any certification or other evidence
requested from time to time by any Lender in its reasonable discretion,
confirming the Loan Parties’ compliance with this Section 6.20).
     (b) Cause or permit any of the funds of such Loan Party that are used to
repay the Loans to be derived from any unlawful activity with the result that
the making of the Loans would be in violation of any Requirement of Law.
     SECTION 6.21 Embargoed Persons. Cause or permit (a) any of the funds or
properties of the Loan Parties that are used to repay the Loans to constitute
property of, or be beneficially owned directly or indirectly by, any person
subject to sanctions or trade restrictions under United States law (“Embargoed
Person” or “Embargoed Persons”) that is identified on (1) the “List of Specially
Designated Nationals and Blocked Persons” maintained by OFAC and/or on any other
similar list maintained by OFAC pursuant to any authorizing statute including,
but not limited to, the International Emergency Economic Powers Act, 50 U.S.C.

     
 
   

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§§ 1701 et seq., The Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and
any Executive Order or Requirement of Law promulgated thereunder, with the
result that the investment in the Loan Parties (whether directly or indirectly)
is prohibited by a Requirement of Law, or the Loans made by the Lenders would be
in violation of a Requirement of Law, or (2) the Executive Order, any related
enabling legislation or any other similar Executive Orders or (b) any Embargoed
Person to have any direct or indirect interest, of any nature whatsoever in the
Loan Parties, with the result that the investment in the Loan Parties (whether
directly or indirectly) is prohibited by a Requirement of Law or the Loans are
in violation of a Requirement of Law.
SECTION 6.22 Tax Shelter Reporting. Treat the Loans as being a “reportable
transaction” within the meaning of Treasury Regulation Section 1.6011-4. In the
event Borrowers (or any of them) determine to take any action inconsistent with
such intention, they will promptly notify the Administrative Agent thereof. This
covenant shall survive the payment and termination of any Loans under this
Agreement.
ARTICLE VII.
GUARANTEE
SECTION 7.01 The Guarantee. The Guarantors hereby jointly and severally
guarantee, as a primary obligor and not as a surety to each Secured Party and
their respective successors and permitted assigns, the prompt payment in full
when due (whether at stated maturity, by required prepayment, declaration,
demand, by acceleration or otherwise) of the principal of and interest
(including any interest, fees, costs or charges that would accrue but for the
provisions of the Title 11 of the United States Code after any bankruptcy or
insolvency petition under Title 11 of the United States Code) on the Loans made
by the Lenders to, and the Notes held by each Lender of, each Borrower, and all
other Secured Obligations from time to time owing to the Secured Parties by any
Loan Party under any Loan Document (including any Hedging Agreement entered into
with a counterparty that is a Secured Party), and the performance of all
obligations under any of the foregoing, in each case strictly in accordance with
the terms thereof (such obligations being herein collectively called the
“Guaranteed Obligations”). In addition to the guarantee contained herein, each
Guarantor that is a Foreign Subsidiary, as well as Holdings, shall execute a
Guarantee governed by the applicable law of such Person’s jurisdiction of
organization (each such Guarantee, a “Foreign Guarantee”) and to the extent that
the provisions of this Article VII shall duplicate or conflict with the
provisions thereof, the terms of the Foreign Guarantees shall govern the
obligations of such Guarantors. The Guarantors hereby jointly and severally
agree that if Borrower(s) or other Guarantor(s) shall fail to pay in full when
due (whether at stated maturity, by acceleration or otherwise) any of the
Guaranteed Obligations, the Guarantors will promptly pay the same in cash,
without any demand or notice whatsoever as if it was the principal obligor, and
that in the case of any extension of time of payment or renewal of any of the
Guaranteed Obligations, the same will be promptly paid in full when due (whether
at extended maturity, by acceleration or otherwise) in accordance with the terms
of such extension or renewal. Without prejudice to the generality of
Section 7.01 and Section 7.02, each Guarantor expressly confirms that it intends
that this guarantee shall extend from time to time to any (however fundamental
and of whatsoever nature and whether or not more onerous) variation, increase,
extension or addition of or to any of the Loan Documents and/or any facility or
amount made available under any of the Loan Documents for the purposes
 

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of or in connection with any of the following: acquisitions of any nature;
increasing working capital; enabling investor distributors to be made; carrying
out restructurings; refinancing existing facilities; refinancing any other
indebtedness; making facilities available to new borrowers; any other variation
or extension of the purposes for which any such facility or amount might be made
available from time to time; and any fees, costs and/or expenses associated with
any of the foregoing.
SECTION 7.02 Obligations Unconditional. The obligations of the Guarantors under
Section 7.01 shall constitute a guaranty of payment and to the fullest extent
permitted by applicable Requirements of Law, are absolute, irrevocable and
unconditional, joint and several, irrespective of the value, genuineness,
validity, regularity or enforceability of the Guaranteed Obligations of
Borrowers or any other Loan Party under this Agreement, the Notes, if any, or
any other agreement or instrument referred to herein or therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, irrespective of any other circumstance
whatsoever that might otherwise constitute a legal or equitable discharge or
defense of a surety or Guarantor (except for payment in full). Without limiting
the generality of the foregoing, it is agreed that the occurrence of any one or
more of the following shall not alter or impair the liability of the Guarantors
hereunder which shall remain absolute, irrevocable and unconditional under any
and all circumstances as described above:
          (i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or compliance
shall be waived;
          (ii) any of the acts mentioned in any of the provisions of this
Agreement or the Notes, if any, or any other agreement or instrument referred to
herein or therein shall be done or omitted;
          (iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be amended in any
respect, or any right under the Loan Documents or any other agreement or
instrument referred to herein or therein shall be amended or waived in any
respect or any other guarantee of any of the Guaranteed Obligations or any
security therefor shall be released or exchanged in whole or in part or
otherwise dealt with;
          (iv) any Lien or security interest granted to, or in favor of, any
Lender or Agent as security for any of the Guaranteed Obligations shall fail to
be perfected; or
          (v) the release of any other Guarantor pursuant to Section 7.09.
     The Guarantors hereby expressly waive diligence, presentment, demand of
payment, protest and all notices whatsoever, and any requirement that any
Secured Party exhaust any right, power or remedy or proceed against any Borrower
or any other Loan Party under this Agreement or the Notes, if any, or any other
agreement or instrument referred to herein or therein, or against any other
person under any other guarantee of, or security for, any of the Guaranteed
Obligations. The Guarantors waive any and all notice of the creation, renewal,
extension, waiver, termination or accrual of any of the Guaranteed Obligations
and notice of or proof of reliance by any Secured Party upon this Guarantee or
acceptance of this Guarantee, and the
 

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Guaranteed Obligations, and any of them, shall conclusively be deemed to have
been created, contracted or incurred in reliance upon this Guarantee, and all
dealings between Borrowers and the Secured Parties shall likewise be
conclusively presumed to have been had or consummated in reliance upon this
Guarantee. This Guarantee shall be construed as a continuing, absolute,
irrevocable and unconditional guarantee of payment without regard to any right
of offset with respect to the Guaranteed Obligations at any time or from time to
time held by Secured Parties, and the obligations and liabilities of the
Guarantors hereunder shall not be conditioned or contingent upon the pursuit by
the Secured Parties or any other person at any time of any right or remedy
against any Borrower or any other Loan Party, or against any other person which
may be or become liable in respect of all or any part of the Guaranteed
Obligations or against any collateral security or guarantee therefor or right of
offset with respect thereto. This Guarantee shall remain in full force and
effect and be binding in accordance with and to the extent of its terms upon the
Guarantors and the successors and assigns thereof, and shall inure to the
benefit of the Lenders, and their respective successors and assigns,
notwithstanding that from time to time during the term of this Agreement there
may be no Guaranteed Obligations outstanding.
SECTION 7.03 Reinstatement. The obligations of the Guarantors under this ARTICLE
VII shall be automatically reinstated if and to the extent that for any reason
any payment by or on behalf of any Borrower or other Loan Party in respect of
the Guaranteed Obligations is rescinded or must be otherwise restored by any
holder of any of the Guaranteed Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise. The Guarantors jointly
and severally agree that they will indemnify each Secured Party on demand for
all reasonable costs and expenses (including reasonable fees of counsel)
incurred by such Secured Party in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law,
other than any costs or expenses resulting from the bad faith or willful
misconduct of such Secured Party.
SECTION 7.04 Subrogation; Subordination. Each Guarantor hereby agrees that until
the indefeasible and irrevocable payment and satisfaction in full in cash of all
Guaranteed Obligations and the expiration and termination of the Commitments of
the Lenders under this Agreement it shall waive any claim and shall not exercise
any right or remedy, direct or indirect, arising by reason of any performance by
it of its guarantee in Section 7.01, whether by subrogation or otherwise,
against any Borrower or any other Guarantor of any of the Guaranteed Obligations
or any security for any of the Guaranteed Obligations. Any Indebtedness of any
Loan Party permitted pursuant to Section 6.01(d) shall be subordinated to such
Loan Party’s Secured Obligations a manner reasonably satisfactory to the
Administrative Agent.
SECTION 7.05 Remedies. The Guarantors jointly and severally agree that, as
between the Guarantors and the Lenders, the obligations of Borrowers under this
Agreement and the Notes, if any, may be declared to be forthwith due and payable
as provided in Section 8.01 (and shall be deemed to have become automatically
due and payable in the circumstances provided in Section 8.01) for purposes of
Section 7.01, notwithstanding any stay, injunction or other prohibition
preventing such declaration (or such obligations from becoming automatically due
and payable) as against Borrowers and that, in the event of such declaration (or
such obligations being deemed to have become automatically due and payable),
such obligations
 

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(whether or not due and payable by Borrowers) shall forthwith become due and
payable by the Guarantors for purposes of Section 7.01.
SECTION 7.06 Instrument for the Payment of Money. Each Guarantor hereby
acknowledges that the guarantee in this ARTICLE VII constitutes an instrument
for the payment of money, and consents and agrees that any Lender or Agent, at
its sole option, in the event of a dispute by such Guarantor in the payment of
any moneys due hereunder, shall have the right to bring a motion-action under
New York CPLR Section 3213.
SECTION 7.07 Continuing Guarantee. The guarantee in this ARTICLE VII is a
continuing guarantee of payment, and shall apply to all Guaranteed Obligations
whenever arising.
SECTION 7.08 General Limitation on Guarantee Obligations. In any action or
proceeding involving any state corporate limited partnership or limited
liability company law, or any applicable state, federal or foreign bankruptcy,
insolvency, reorganization or other law affecting the rights of creditors
generally, if the obligations of any Guarantor under Section 7.01 would
otherwise be held or determined to be void, voidable, invalid or unenforceable,
or subordinated to the claims of any other creditors, on account of the amount
of its liability under Section 7.01, then, notwithstanding any other provision
to the contrary, the amount of such liability shall, without any further action
by such Guarantor, any Loan Party or any other person, be automatically limited
and reduced to the highest amount (after giving effect to the rights of
contribution established in the Contribution, Intercompany, Contracting and
Offset Agreement) that are valid and enforceable and not subordinated to the
claims of other creditors as determined in such action or proceeding.
SECTION 7.09 Release of Guarantors. If, in compliance with the terms and
provisions of the Loan Documents, Equity Interests of any Guarantor are sold or
transferred such that it ceases to be a Subsidiary (a “Transferred Guarantor”)
to a person or persons, none of which is a Loan Party or a Subsidiary, such
Transferred Guarantor shall, upon the consummation of such sale or transfer, be
released from its obligations under this Agreement (including under
Section 11.03 hereof) and its obligations to pledge and grant any Collateral
owned by it pursuant to any Security Document and the pledge of such Equity
Interests so transferred to the Collateral Agent pursuant to the Security
Agreements shall be released, and the Collateral Agent shall take such actions
as are necessary to effect each release described in this Section 7.09 in
accordance with the relevant provisions of the Security Documents; provided that
such Guarantor is also released from its obligations under the Revolving Credit
Loan Documents and other guaranteed Material Indebtedness on the same terms.
SECTION 7.10 Certain Tax Matters. Notwithstanding the provisions of Section 2.15
if a Loan Party makes a payment hereunder that is subject to withholding tax in
excess of the withholding that would have been imposed on payments made by the
Borrower with respect to whose obligation it is making a payment, the Loan
Parties shall increase the amount of such payment such that, after deduction and
payment of all such withholding taxes, the payee receives an amount equal to the
amount it would have received if no such withholding had been imposed; provided
that the Agent or Lender provides, as reasonably requested by the relevant Loan
Party and as required under Sections 2.15(e) or 2.15(g), as the case may be,
such forms, certificates
 

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and documentation that it is legally entitled to furnish and would be required
to reduce or eliminate withholding and, with respect to non-U.S. withholding
taxes, would not, in the Administrative Agent’s or the relevant Lender’s
reasonable judgment, subject it to any material unreimbursed costs or otherwise
be disadvantageous to it in any material respect.
SECTION 7.11 German Guarantor.
     (a) Subject to Section 7.11(b) through Section 7.11(e) below, the Secured
Parties shall not enforce the guarantee obligations of a German Guarantor
existing in the form of a German limited liability company or limited
partnership with a limited liability company as partner (GmbH or GmbH & Co. KG)
under this Article VII to the extent (i) such German Guarantor guarantees
obligations of one of its shareholders or of an affiliated company (verbundenes
Unternehmen) of a shareholder within the meaning of Section 15 of the German
Stock Corporation Act (Aktiengesetz) (other than a Subsidiary of that German
Guarantor or the German Guarantor itself), and (ii) the enforcement of such
guarantee for shareholder obligations would reduce, in violation of Section 30
of the German Limited Liability Companies Act (GmbHG), the net assets (assets
minus liabilities minus provisions and liability reserves (Reinvermögen), in
each case as calculated in accordance with generally accepted accounting
principles in Germany (Grundsätze ordnungsmäßiger Buchführung) as consistently
applied by such German Guarantor in preparing its unconsolidated balance sheets
(Jahresabschluss gem. § 42 GmbH — Act, §§ 242, 264 HGB) of the German Guarantor
(or in the case of a GmbH & Co. KG, its general partner) to an amount that is
insufficient to maintain its (or in the case of a GmbH & Co. KG, its general
partner’s) registered share capital (Stammkapital) (or would increase an
existing shortage in its net assets below its registered share capital);
provided that for the purpose of determining the relevant registered share
capital and the net assets, as the case may be:
          (i) The amount of any increase of registered share capital
(Stammkapital) of such German Guarantor (or its general partner in the form of a
GmbH) implemented after the date of this Agreement that is effected without the
prior written consent of the Administrative Agent shall be deducted from the
registered share capital of the German Guarantor (or its general partner in the
form of a GmbH);
          (ii) any loans provided to the German Guarantor by a direct or
indirect shareholder or an affiliate thereof (other than a Subsidiary of such
German Guarantor) shall be disregarded and not accounted for as a liability to
the extent that such loans are subordinated or are considered subordinated under
Section 32a GmbHG;
          (iii) shareholder loans, other loans and contractual obligations and
liabilities incurred by the German Guarantor in violation of the provisions of
any of the Loan Documents shall be disregarded and not accounted for as
liabilities;
          (iv) any assets that are shown in the balance sheet with a book value
that, in the opinion of the Administrative Agent, is significantly lower than
their market value and that are not necessary for the business of the German
Guarantor (nicht betriebsnotwendig) shall be accounted for with their market
value; and

     
 
   

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          (v) the assets of the German Guarantor will be assessed at liquidation
values (Liquidationswerte) if, at the time the managing directors prepare the
balance sheet in accordance with paragraph (b) below and absent the demand a
positive going concern prognosis (positive Fortbestehensprognose) cannot be
established.
     (b) The limitations set out in Section 7.11(a) only apply:
          (i) if and to the extent that the managing directors of the German
Guarantor (or in the case of a GmbH Co. KG, its general partner) have confirmed
in writing to the Administrative Agent within ten (10) Business Days of a demand
for payment under this Article VII the amount of the obligations under this
Article VII which cannot be paid without causing the net assets of such German
Guarantor (or in the case of a GmbH Co. KG, its general partner) to fall below
its registered share capital, or increase an existing shortage in net assets
below its registered share capital (taking into account the adjustments set out
above) and such confirmation is supported by a current balance sheet and other
evidence satisfactory to the Administrative Agent and neither the Administrative
Agent nor any Lender raises any objections against that confirmation within five
Business Days after its receipt; or
          (ii) if, within twenty Business Days after an objection under clause
(ii) has been raised by the Administrative Agent or a Lender, the Administrative
Agent receives a written audit report (“Auditor’s Determination”) prepared at
the expense of the relevant German Guarantor by a firm of auditors of
international standing and reputation that is appointed by the German Guarantor
and reasonably acceptable to the Administrative Agent, to the extent such report
identifies the amount by which the net assets of that German Guarantor (or in
the case of a GmbH & Co. KG, its general partner in the form of a GmbH) are
necessary to maintain its registered share capital as at the date of the demand
under this Article VII (taking into account the adjustments set out above). The
Auditor’s Determination shall be prepared in accordance with generally accepted
accounting principles applicable in Germany (Grundsätze ordnungsgemäßer
Buchführung) as consistently applied by the German Guarantor in the preparation
of its most recent annual balance sheet. The Auditor’s Determination shall be
binding for all Parties except for manifest error.
     (c) In any event, the Credit Parties shall be entitled to enforce the
guarantee up to those amounts that are undisputed between them and the relevant
German Guarantor or determined in accordance with Section 7.11(a) and
Section 7.11(b). In respect of the exceeding amounts, the Credit Parties shall
be entitled to further pursue their claims (if any) and the German Guarantor
shall be entitled to provide that the excess amounts are necessary to maintain
its registered share capital (calculated as at the date of demand under this
Article VII and taking into account the adjustments set out above). The Secured
Parties are entitled to pursue those parts of the guarantee obligations of the
German Guarantor that are not enforced by operation of Section 7.11(a) above at
any subsequent point in time. This Section 7.11 shall apply again as of the time
such additional demands are made.
     (d) Section 7.11(a) shall not apply as to the amount of Loans borrowed
under this Agreement and passed on (whether by way of shareholder loan or equity
contribution) to the respective German Guarantor or any of its Subsidiaries as
long as the respective shareholder loan is outstanding or the respective equity
contribution has not been dissolved or otherwise repaid.
 

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     (e) Should it become legally permissible for managing directors of a German
Guarantor to enter into guarantees in support of obligations of their
shareholders without limitations, the limitations set forth in Section 7.11(a)
shall no longer apply. Should any such guarantees become subject to legal
restrictions that are less stringent than the limitations set forth in
Section 7.11(a) above, such less stringent limitations shall apply. Otherwise,
Section 7.11(a) shall remain unaffected by changes in applicable law.
SECTION 7.12 Swiss Guarantors. If and to the extent that (i) the obligations
under this ARTICLE VII of any Swiss Guarantor are for the exclusive benefit of
any of such Swiss Guarantor’s Affiliates (other than such Swiss Guarantor’s
direct or indirect Subsidiaries) and (ii) complying with the obligations under
this ARTICLE VII would constitute a repayment of capital (restitution des
apports) or the payment of a (constructive) dividend (distribution de
dividende), the following shall apply:
     (a) The aggregate obligations under this ARTICLE VII of any Swiss Guarantor
shall be limited to the maximum amount of such Swiss Guarantor’s profits and
reserves available for distribution, in each case in accordance with, without
limitation, articles 671 para.1 to 3 and 675 para.2 of the Swiss Code of
Obligations (the “Available Amount”) at the time any Swiss Guarantor makes a
payment under this ARTICLE VII (provided such limitation is still a legal
requirement under Swiss law at that time).
     (b) Immediately after having been requested to make a payment under this
ARTICLE VII (the “Guarantee Payment”), each Swiss Guarantor shall (i) provide
the Administrative Agent, within thirty (30) Business Days from being requested
to make the Guarantee Payment, with (1) an interim audited balance sheet
prepared by the statutory auditors of the applicable Swiss Guarantor, (2) the
determination of the Available Amount based on such interim audited balance
sheet as computed by the statutory auditors, and (3) a confirmation from the
statutory auditors that the Available Amount is the maximum amount which can be
paid by the Swiss Guarantor under this ARTICLE VII without breaching the
provisions of Swiss corporate law, which are aimed at protecting the share
capital and legal reserves, and (ii) upon receipt of the confirmation referred
to in the preceding sentence under (3) and after having taken all actions
required pursuant to paragraph (d) below, make such Guarantee Payment in full
(less, if required, any Swiss Withholding Tax).
     (c) If so required under Swiss law (including double tax treaties to which
Switzerland is a party) at the time it is required to make a payment under this
ARTICLE VII or the Security Documents, the applicable Swiss Guarantor (1) may
deduct the Swiss Withholding Tax at the rate of 35% (or such other rate as may
be in force at such time) from any payment under this ARTICLE VII or the
Security Documents, (2) may pay the Swiss Withholding Tax to the Swiss Federal
Tax Administration, and (3) shall notify and provide evidence to the
Administrative Agent that the Swiss Withholding Tax has been paid to the Swiss
Federal Tax Administration. To the extent the Guarantee Payment due is less than
the Available Amount, the applicable Swiss Guarantor shall be required to make a
gross-up, indemnify or otherwise hold harmless the Secured Parties for the
deduction of the Swiss Withholding Tax, it being understood that at no time
shall the Guarantee Payment (including any gross-up or indemnification payment
pursuant to this paragraph (c) and including any Swiss Withholding Tax levied
thereon) exceed the Available Amount. The applicable Swiss Guarantor shall use
its best efforts to ensure that any
 

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person which is, as a result of a payment under this ARTICLE VII, entitled to a
full or partial refund of the Swiss Withholding Tax, shall as soon as possible
after the deduction of the Swiss Withholding Tax (i) request a refund of the
Swiss Withholding Tax under any applicable law (including double tax treaties)
and (ii) pay to the Administrative Agent for distribution to the applicable
Secured Parties upon receipt any amount so refunded. The Obligations will only
be considered as discharged to the extent of the effective payment received by
the Secured Parties under this ARTICLE VII. This subsection (c) is without
prejudice to the gross-up or indemnification obligations of any Guarantor other
that the Swiss Guarantors.
     (d) The Swiss Guarantors shall use reasonable efforts to take and cause to
be taken all and any other action, including the passing of any shareholders’
resolutions to approve any Guarantee Payment under this ARTICLE VII or the
Security Documents, which may be required as a matter of Swiss mandatory law or
standard business practice as existing at the time it is required to make a
Guarantee Payment under this ARTICLE VII or the Security Documents in order to
allow for a prompt payment of the Guarantee Payment or Available Amount, as
applicable.
SECTION 7.13 Irish Guarantor. This Guarantee does not apply to any liability to
the extent that it would result in this Guarantee constituting unlawful
financial assistance within the meaning of, in respect of any Irish Guarantor,
Section 60 of the Companies Act 1963 of Ireland.
SECTION 7.14 Brazilian Guarantor. The Brazilian Guarantor waives and shall not
exercise any and all rights and privileges granted to guarantors which might
otherwise be deemed applicable, including but not limited to the rights and
privileges referred to in Articles 827, 834, 835, 836, 837, 838 and 839 of the
Brazilian Civil Code and the provisions of Article 595 of the Brazilian Civil
Procedure Code.
ARTICLE VIII.
EVENTS OF DEFAULT
SECTION 8.01 Events of Default. Upon the occurrence and during the continuance
of the following events (“Events of Default”):
     (a) default shall be made in the payment of any principal of any Loan when
and as the same shall become due and payable, whether at the due date thereof
(including a Term Loan Repayment Date) or at a date fixed for prepayment
(whether voluntary or mandatory) thereof or by acceleration thereof or
otherwise, or a prepayment offer required under Section 2.10 shall not be made
in accordance with the terms thereof or a default shall be made in the payment
of any amounts required to be paid upon consummation of a prepayment offer
required under Section 2.10;
     (b) default shall be made in the payment of any interest on any Loan or any
Fee or any other amount (other than an amount referred to in paragraph
(a) above) due under any Loan Document, when and as the same shall become due
and payable, and such default shall continue unremedied for a period of three
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     (c) any representation or warranty made or deemed made in or in connection
with any Loan Document or the borrowings hereunder, or which is contained in any
certificate furnished by or on behalf of a Loan Party pursuant to this Agreement
or any other Loan Document, shall prove to have been false or misleading in any
material respect when so made or deemed made;
     (d) default shall be made in the due observance or performance by any
Company of any covenant, condition or agreement contained in Section 5.02(a),
Section 5.03(a), Section 5.04(a), Section 5.04(b), Section 5.08 or ARTICLE VI);
     (e) (i) default shall be made in the due observance or performance by any
Company of any covenant, condition or agreement contained in Section 5.02 (other
than Section 5.02(a)), and such default shall continue unremedied or shall not
be waived for a period of five (5) days after written notice thereof from the
Administrative Agent or any Lender to Administrative Borrower, or (ii) default
shall be made in the due observance or performance by any Company of any
covenant, condition or agreement contained in any Loan Document (other than
those specified in paragraphs (a), (b), (d) or (e)(i) immediately above) and
such default shall continue unremedied or shall not be waived for a period of
thirty (30) days after written notice thereof from the Administrative Agent or
any Lender to Administrative Borrower;
     (f) any Company shall (i) fail to pay any principal or interest, regardless
of amount, due in respect of any Indebtedness (other than the Obligations), when
and as the same shall become due and payable beyond any applicable grace period,
or (ii) fail to observe or perform any other term, covenant, condition or
agreement contained in any agreement or instrument evidencing or governing any
such Indebtedness if the effect of any failure referred to in this clause
(ii) is to cause, or to permit (in the case of the Senior Notes only, with or
without the lapse of time, but after any notice period required thereunder has
commenced) the holder or holders of such Indebtedness or a trustee or other
representative on its or their behalf to cause, such Indebtedness to become due
prior to its stated maturity or become subject to a mandatory offer purchase by
the obligor; provided that, other than in the case of the Revolving Credit
Loans, it shall not constitute an Event of Default pursuant to this paragraph
(f) unless the aggregate Dollar Equivalent amount of all such Indebtedness
referred to in clauses (i) and (ii) exceeds $50 million at any one time
(provided that, in the case of Hedging Obligations, the amount counted for this
purpose shall be the net amount payable by all Companies if such Hedging
Obligations were terminated at such time);
     (g) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed in a court of competent jurisdiction seeking (i) relief in
respect of any Loan Party or Material Subsidiary, or of a substantial part of
the property of any Loan Party or Material Subsidiary, under Title 11 of the
U.S. Code, as now constituted or hereafter amended, or any other federal, state
or foreign bankruptcy, insolvency, receivership or similar law; (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator,
examiner or similar official for any Loan Party or Material Subsidiary or for a
substantial part of the property of any Loan Party or Material Subsidiary; or
(iii) the winding-up, liquidation or examination of any Loan Party or Material
Subsidiary; and such proceeding or petition shall continue undismissed for sixty
(60) days or an order or decree approving or ordering any of the foregoing shall
be entered;

     
 
   

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     (h) any Loan Party or Material Subsidiary shall (i) voluntarily commence
any proceeding or file any petition seeking relief under Title 11 of the United
States Code, as now constituted or hereafter amended, or any other federal,
state or foreign bankruptcy, insolvency, receivership or similar law;
(ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or the filing of any petition described in
clause (g) above; (iii) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator, conservator, examiner or similar official for
any Loan Party or Material Subsidiary or for a substantial part of the property
of any Loan Party or Material Subsidiary; (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding;
(v) make a general assignment for the benefit of creditors; (vi) become unable,
admit in writing its insolvency or inability or fail generally to pay its debts
as they become due; (vii) take any action for the purpose of effecting any of
the foregoing; (viii) wind up or liquidate (except in accordance with Section
6.05) or put into examination, (ix) take any step with a view to a moratorium or
a composition or similar arrangement with any creditors of any Loan Party or
Material Subsidiary, or a moratorium is declared or instituted in respect of the
indebtedness of any Loan Party or Material Subsidiary;
     (i) one or more judgments, orders or decrees for the payment of money in an
aggregate Dollar Equivalent amount in excess of $25 million, to the extent not
covered by insurance or supported by a letter of credit or appeal bonds posted
in cash, shall be rendered against any Company or any combination thereof and
the same shall remain undischarged, unvacated or unbonded for a period of thirty
(30) consecutive days during which execution shall not be effectively stayed, or
any action shall be legally taken by a judgment creditor to levy upon properties
of any Company to enforce any such judgment;
     (j) one or more ERISA Events or noncompliance with respect to Foreign Plans
or Compensation Plans shall have occurred that, when taken together with all
other such ERISA Events and noncompliance with respect to Foreign Plans or
Compensation Plans that have occurred, could reasonably be expected to result in
liability of any Company and its ERISA Affiliates that could reasonably be
expected to result in a Material Adverse Effect;
     (k) any security interest and Lien purported to be created by any Security
Document shall cease to be in full force and effect, or shall cease to give the
Collateral Agent, for the benefit of the Secured Parties, a valid, perfected
First Priority security interest in and Lien on all of the Collateral thereunder
(except as otherwise expressly provided in such Security Document) in favor of
the Collateral Agent, or shall be asserted by any Borrower or any other Loan
Party not to be a valid, perfected, First Priority (except as otherwise
expressly provided in this Agreement, the Intercreditor Agreement or such
Security Document) security interest in or Lien on the Collateral covered
thereby;
     (l) any Loan Document or any material provisions thereof shall at any time
and for any reason be declared by a court of competent jurisdiction to be null
and void, or a proceeding shall be commenced by any Loan Party or by any
Governmental Authority, seeking to establish the invalidity or unenforceability
thereof (exclusive of questions of interpretation of any provision thereof), or
any Loan Party shall repudiate or deny any portion of its liability or
obligation for the Obligations;

     
 
   

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     (m) there shall have occurred a Change in Control;
     (n) the Intercreditor Agreement or any material provision thereof shall
cease to be in full force or effect other than (i) as expressly permitted
hereunder or thereunder, (ii) by a consensual termination or modification
thereof agreed to by the Agents party thereto and the Revolving Credit Agents
party thereto, or (iii) as a result of satisfaction in full of the obligations
under the Revolving Credit Loan Documents; or
     (o) any Company shall be prohibited or otherwise restrained from conducting
the business theretofore conducted by it in any manner that has or could
reasonably be expected to result in a Material Adverse Effect by virtue of any
determination, ruling, decision, decree or order of any court or Governmental
Authority of competent jurisdiction;
then, and in every such event (other than an event with respect to any Loan
Party described in paragraph (g) or (h) above), and at any time thereafter
during the continuance of such event or an acceleration of all obligations under
the Revolving Credit Agreement, the Administrative Agent may, and at the request
of the Required Lenders shall, by notice to Administrative Borrower, take either
or both of the following actions, at the same or different times: (i) terminate
forthwith the Commitments and (ii) declare the Loans then outstanding to be
forthwith due and payable in whole or in part, whereupon the principal of the
Loans so declared to be due and payable, together with accrued interest thereon
and any unpaid accrued Fees and all other Obligations of the Loan Parties
accrued hereunder and under any other Loan Document, shall become forthwith due
and payable, without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived by each of the Loan Parties,
anything contained herein or in any other Loan Document to the contrary
notwithstanding; and in any event, with respect to any Loan Party described in
paragraph (g) or (h) above, the Commitments shall automatically terminate and
the principal of the Loans then outstanding, together with accrued interest
thereon and any unpaid accrued Fees and all other Obligations of the Loan
Parties accrued hereunder and under any other Loan Document, shall automatically
become due and payable, without presentment, demand, protest or any other notice
of any kind, all of which are hereby expressly waived by each of the Loan
Parties, anything contained herein or in any other Loan Document to the contrary
notwithstanding.
SECTION 8.02 Rescission. If at any time after termination of the Commitments or
acceleration of the maturity of the Loans, the Loan Parties shall pay all
arrears of interest and all payments on account of principal of the Loans owing
by them that shall have become due otherwise than by acceleration (with interest
on principal and, to the extent permitted by law, on overdue interest, at the
rates specified herein) and all Defaults (other than non-payment of principal of
and accrued interest on the Loans due and payable solely by virtue of
acceleration) shall be remedied or waived pursuant Section 11.02, then upon the
written consent of the Required Lenders and written notice to Administrative
Borrower, the termination of the Commitments or the acceleration and their
consequences may be rescinded and annulled; but such action shall not affect any
subsequent Default or impair any right or remedy consequent thereon. The
provisions of the preceding sentence are intended merely to bind the Lenders to
a decision that may be made at the election of the Required Lenders, and such
provisions are not intended to benefit any Loan Party and do not give any Loan
Party the right to require the
 

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Lenders to rescind or annul any acceleration hereunder, even if the conditions
set forth herein are met.
SECTION 8.03 Application of Proceeds. Subject to the terms of the Intercreditor
Agreement, the proceeds received by any of the Agents in respect of any sale of,
collection from or other realization upon all or any part of the Collateral,
whether pursuant to the exercise by the Collateral Agent of its remedies or
otherwise (including any payments received with respect to adequate protection
payments or other distributions relating to the Obligations during the pendency
of any reorganization or insolvency proceeding) after an Event of Default has
occurred and is continuing or after the acceleration of the Obligations, shall
be applied, in full or in part, together with any other sums then held by the
Agents or any Receiver pursuant to this Agreement, promptly by the Agents or any
Receiver as follows:
     (a) First, to the payment of all reasonable costs and expenses, fees,
commissions and taxes of such sale, collection or other realization including
compensation to the Agents or any Receiver and their agents and counsel, and all
expenses, liabilities and advances made or incurred by the Agents or any
Receiver in connection therewith and all amounts for which the Agents or any
Receiver are entitled to indemnification pursuant to the provisions of any Loan
Document, together with interest on each such amount at the highest rate then in
effect under this Agreement from and after the date such amount is due, owing or
unpaid until paid in full;
     (b) Second, to the payment of all other reasonable costs and expenses of
such sale, collection or other realization including any compensation payable to
the other Secured Parties and their agents and counsel and all costs,
liabilities and advances made or incurred by the other Secured Parties in
connection therewith, together with interest on each such amount at the highest
rate then in effect under this Agreement from and after the date such amount is
due, owing or unpaid until paid in full;
     (c) Third, without duplication of amounts applied pursuant to clauses
(a) and (b) above, to the indefeasible payment in full in cash, pro rata, of
interest and other amounts constituting Obligations which are then due and owing
(other than principal) and any fees, premiums and scheduled periodic payments
due under Hedging Agreements constituting Secured Obligations and any interest
accrued thereon, in each case equally and ratably in accordance with the
respective amounts thereof then due and owing;
     (d) Fourth, to the indefeasible payment in full in cash, pro rata, of the
principal amount of the Obligations and any premium thereon and any breakage,
termination or other payments under Hedging Agreements constituting Secured
Obligations and any interest accrued thereon and any remaining Secured
Obligations; and
     (e) Fifth, the balance, if any, to the person lawfully entitled thereto
(including the applicable Loan Party or its successors or assigns) or as a court
of competent jurisdiction may direct.
     In the event that any such proceeds are insufficient to pay in full the
items described in clauses (a) through (d) of this Section 8.03, the Loan
Parties shall remain liable, jointly and severally, for any deficiency.
Notwithstanding any other provision of this Agreement, after
 

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application pursuant to clauses (a) and (b) of this Section 8.03, any remaining
proceeds of any of the 525 Collateral Accounts shall be applied to the
indefeasible payment in full in cash, pro rata of the principal amount of any
outstanding Canadian Term Loans which were not prepaid with amounts in such
accounts as a result of Section 2.10(h)(vi) and any accrued and unpaid interest
thereon, and thereafter, any remaining proceeds of the 525 Collateral Accounts
shall be applied in the priority set forth in clauses (c) through (e) of this
Section 8.03.
ARTICLE IX.
[INTENTIONALLY OMITTED]
ARTICLE X.
THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT
SECTION 10.01 Appointment and Authority. Each of the Lenders hereby irrevocably
appoints UBS AG, Stamford Branch, to act on its behalf as the Administrative
Agent and the Collateral Agent hereunder and under the other Loan Documents and
authorizes such Agents to take such actions on its behalf and to exercise such
powers as are delegated to such Agents by the terms hereof or thereof, together
with such actions and powers as are reasonably incidental thereto. The
provisions of this Article are solely for the benefit of the Administrative
Agent, the Collateral Agent, the other Agents and the Lenders, and neither
Borrowers nor any other Loan Party shall have rights as a third party
beneficiary of any of such provisions.
SECTION 10.02 Rights as a Lender. Each person serving as an Agent hereunder
shall have the same rights and powers in its capacity as a Lender as any other
Lender and may exercise the same as though it were not an Agent and the term
“Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the
context otherwise requires, include each person serving as an Agent hereunder in
its individual capacity. Such person and its Affiliates may accept deposits
from, lend money to, act as the financial advisor or in any other advisory
capacity for and generally engage in any kind of business with any Borrower or
other Loan Party, or any Subsidiary or other Affiliate thereof, as if such
person were not an Agent hereunder and without any duty to account therefor to
the Lenders.
SECTION 10.03 Exculpatory Provisions.
     (a) No Agent shall have any duties or obligations except those expressly
set forth herein and in the other Loan Documents. Without limiting the
generality of the foregoing, no Agent:
          (i) shall be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;
          (ii) shall have any duty to take any discretionary action or exercise
any discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that such Agent is required
to exercise as directed in writing by the Required Lenders (or such other number
or percentage of the Lenders as shall be expressly provided for herein or in the
other Loan Documents); provided that such Agent shall not be
 

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required to take any action that, in its judgment or the judgment of its
counsel, may expose such Agent to liability or that is contrary to any Loan
Document or applicable Requirements of Law; and
          (iii) shall, except as expressly set forth herein and in the other
Loan Documents, have any duty to disclose, and shall not be liable for the
failure to disclose, any information relating to any Borrower or other Loan
Party or any of its Affiliates that is communicated to or obtained by the person
serving as such Agent or any of its Affiliates in any capacity.
     (b) No Agent shall be liable for any action taken or not taken by it
(x) with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary, or as such Agent
shall believe in good faith shall be necessary, under the circumstances as
provided in Section 11.02) or (y) in the absence of its own gross negligence or
willful misconduct. No Agent shall be deemed to have knowledge of any Default
unless and until notice describing such Default is given to such Agent by
Administrative Borrower or a Lender.
     (c) No Agent shall be responsible for or have any duty to ascertain or
inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered hereunder or thereunder or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein or
therein or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document or (v) the satisfaction of any condition
set forth in ARTICLE IV or elsewhere herein, other than to confirm receipt of
items expressly required to be delivered to such Agent. Without limiting the
generality of the foregoing, the use of the term “agent” in this Agreement with
reference to the Administrative Agent or the Collateral Agent is not intended to
connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term us used merely as a
matter of market custom and is intended to create or reflect only an
administrative relationship between independent contracting parties.
SECTION 10.04 Reliance by Agent. Each Agent shall be entitled to rely upon, and
shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing
(including any electronic message, Internet or intranet website posting or other
distribution) believed by it to be genuine and to have been signed, sent or
otherwise authenticated by the proper person. Each Agent also may rely upon any
statement made to it orally or by telephone and believed by it to have been made
by the proper person, and shall not incur any liability for relying thereon. In
determining compliance with any condition hereunder to the making of a Loan that
by its terms must be fulfilled to the satisfaction of a Lender, the
Administrative Agent may presume that such condition is satisfactory to such
Lender unless the Administrative Agent shall have received notice to the
contrary from such Lender prior to the making of such Loan. Each Agent may
consult with legal counsel (who may be counsel for any Borrower or other Loan
Party), independent accountants and other experts selected by it, and shall not
be liable for any action taken or not taken by it in accordance with the advice
of any such counsel, accountants or experts.
 

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SECTION 10.05 Delegation of Duties. Each Agent may perform any and all of its
duties and exercise its rights and powers hereunder or under any other Loan
Document by or through, or delegate any and all such rights and powers to, any
one or more sub-agents appointed by such Agent, including a sub-agent which is a
non-U.S. affiliate of such Agent. Each Agent and any such sub-agent may perform
any and all of its duties and exercise its rights and powers by or through their
respective Related Parties. The exculpatory provisions of this Article shall
apply to any such sub-agent and to the Related Parties of each Agent and any
such sub-agent, and shall apply to their respective activities in connection
with the syndication of the credit facilities provided for herein as well as
activities as Agent.
SECTION 10.06 Resignation of Agent. Each Agent may at any time give notice of
its resignation to the Lenders and Administrative Borrower. Upon receipt of any
such notice of resignation, the Required Lenders shall have the right, in
consultation with Administrative Borrower, to appoint a successor, which
(i) shall be a bank with an office in the United States, or an Affiliate of any
such bank with an office in the United States and (ii) for the Administrative
Agent, shall be a commercial bank or other financial institution having assets
in excess of $1,000 million. If no such successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within thirty
(30) days after the retiring Agent gives notice of its resignation, then the
retiring Agent may on behalf of the Lenders, appoint a successor Agent meeting
the qualifications set forth above provided that if the Agent shall notify
Administrative Borrower and the Lenders that no qualifying person has accepted
such appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (1) the retiring Agent shall be discharged from
its duties and obligations hereunder and under the other Loan Documents (except
that in the case of any collateral security held by the Collateral Agent on
behalf of the Lenders under any of the Loan Documents, the retiring Collateral
Agent shall continue to hold such collateral security as nominee until such time
as a successor Collateral Agent is appointed) and (2) all payments,
communications and determinations provided to be made by, to or through an Agent
shall instead be made by or to each Lender directly, until such time as the
Required Lenders appoint a successor Agent as provided for above in this
paragraph. Upon the acceptance of a successor’s appointment as Agent hereunder,
such successor shall succeed to and become vested with all of the rights,
powers, privileges and duties of the retiring (or retired) Agent, and the
retiring Agent shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents (if not already discharged therefrom
as provided above in this paragraph). The fees payable by the Borrowers to a
successor Agent shall be the same as those payable to its predecessor unless
otherwise agreed between the Borrowers and such successor. After the retiring
Agent’s resignation hereunder and under the other Loan Documents, the provisions
of this ARTICLE X and Section 11.03 shall continue in effect for the benefit of
such retiring Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while the
retiring Agent was acting as Agent.
SECTION 10.07 Non-Reliance on Agent and Other Lenders. Each Lender acknowledges
that it has, independently and without reliance upon any Agent or any other
Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender further represents and warrants that it has reviewed the Confidential
Information Memorandum and each other document made available to it on the
Platform in connection with this Agreement and has
 

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acknowledged and accepted the terms and conditions applicable to the recipients
thereof. Each Lender also acknowledges that it will, independently and without
reliance upon any Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document or any related agreement or any document furnished
hereunder or thereunder.
SECTION 10.08 No Other Duties, etc. Notwithstanding anything to the contrary
contained herein, none of the Joint Bookmanagers, Joint Lead Arrangers,
Syndication Agent, or Documentation Agent listed on the cover page hereof shall
have any powers, duties or responsibilities under this Agreement or any of the
other Loan Documents, except in its capacity, as applicable, as the
Administrative Agent, as the Collateral Agent or as a Lender hereunder.
SECTION 10.09 Indemnification. The Lenders severally agree to indemnify each
Agent in its capacity as such (to the extent not reimbursed by the Borrowers or
the Guarantors and without limiting the obligation of the Borrowers or the
Guarantors to do so), ratably according to their respective outstanding Loans
and Commitments in effect on the date on which indemnification is sought under
this Section 10.09 (or, if indemnification is sought after the date upon which
all Commitments shall have terminated and the Loans shall have been paid in
full, ratably in accordance with such outstanding Loans and Commitments as in
effect immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided, that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from such Agent’s gross negligence or
willful misconduct. The agreements in this Section 10.09 shall survive the
payment of the Loans and all other amounts payable hereunder.
SECTION 10.10 [INTENTIONALLY OMITTED].
SECTION 10.11 Concerning the Collateral and the Related Loan Documents. Each
Lender authorizes and directs Agents to enter into this Agreement and the other
Loan Documents, including the Intercreditor Agreement. Each Lender agrees that
any action taken by Agents or Required Lenders in accordance with the terms of
this Agreement or the other Loan Documents, including the Intercreditor
Agreement, and the exercise by Agents or Required Lenders of their respective
powers set forth therein or herein, together with such other powers that are
reasonably incidental thereto, shall be binding upon all of the Lenders.
SECTION 10.12 Release. Each Lender and each Issuer hereby releases each Agent
acting on its behalf pursuant to the terms of this Agreement or any other Loan
Document from the restrictions of Section 181 of the German Civil Code
(Bürgerliches Gesetzbuch) (restriction on self-dealing).
 

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SECTION 10.13 Acknowledgment of Security Trust Deed. Each Lender acknowledges
the terms of the Security Trust Deed and, in particular, the terms, basis and
limitation on which the Collateral Agent holds the “Transaction Security” (as
defined therein) and specifically agrees and accepts (i) such terms, basis and
limitation; (ii) that the Collateral Agent shall, as trustee, have only those
duties, obligations and responsibilities expressly specified in the Security
Trust Deed; (iii) the limitation and exclusion of the Collateral Agent’s
liability as set out therein; and (iv) all other provisions of the Security
Trust Deed as if it were a party thereto.
ARTICLE XI.
MISCELLANEOUS
SECTION 11.01 Notices.
     (a) Generally. Except in the case of notices and other communications
expressly permitted to be given by telephone (and except as provided in
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopier as follows:
(i) if to any Loan Party, to Administrative Borrower at:
Novelis Inc.
3399 Peachtree Road NE, Suite 1500
Atlanta, GA 30326
Attention: Orville Lunking, Treasurer
Telecopier No.: 404-814-4200
Email: orville.lunking@novelis.com
with a copy to:
Novelis Inc.
3399 Peachtree Road NE, Suite 1500
Atlanta, GA 30326
Attention: Leslie J. Parrette, Jr.
Telecopier No.: 404-814-4272
Email: les.parrette@novelis.com
(ii) if to a Lender, to it at its address (or telecopier number) set forth in
its Administrative Questionnaire; and
 

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(iii) if to the Administrative Agent or the Collateral Agent, to it at:
UBS AG, Stamford Branch
677 Washington Boulevard
Stamford, Connecticut 06901
Attention: Christopher Gomes
Telecopier No.: (203) 719-3180
Email: Christopher.Gomes@UBS.com
with a copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
300 South Grand Avenue
Los Angeles, CA 90071
Attention: David C. Reamer
Telecopier No.: (213) 687-5600
Phone No.: (213) 687-5000
Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by telecopier shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient). Notices delivered through electronic communications to the extent
provided in paragraph (b) below, shall be effective as provided in said
paragraph (b).
     (b) Electronic Communications. Notices and other communications to the
Lenders hereunder may (subject to Section 11.01(d)) be delivered or furnished by
electronic communication (including e-mail and Internet or intranet websites)
pursuant to procedures approved by the Administrative Agent; provided that the
foregoing shall not apply to notices to any Lender pursuant to ARTICLE II if
such Lender, as applicable, has notified the Administrative Agent that it is
incapable of receiving notices under such Article by electronic communication.
The Administrative Agent, the Collateral Agent or Administrative Borrower may,
in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it
(including as set forth in Section 11.01(d)); provided that approval of such
procedures may be limited to particular notices or communications.
     Unless the Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement); provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next business day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.
 

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     (c) Change of Address, Etc. Any party hereto may change its address or
telecopier number for notices and other communications hereunder by notice to
the other parties hereto.
     (d) Posting. Each Loan Party hereby agrees that it will provide to the
Administrative Agent all information, documents and other materials that it is
obligated to furnish to the Administrative Agent pursuant to this Agreement and
any other Loan Document, including all notices, requests, financial statements,
financial and other reports, certificates and other information materials, but
excluding any such communication that (i) relates to a request for a new, or a
conversion of an existing, Borrowing or other extension of credit (including any
election of an interest rate or interest period relating thereto), (ii) relates
to the payment of any principal or other amount due under this Agreement prior
to the scheduled date therefor, (iii) provides notice of any Default under this
Agreement or (iv) is required to be delivered to satisfy any condition precedent
to the effectiveness of this Agreement and/or any borrowing or other extension
of credit hereunder (all such non-excluded communications, collectively, the
“Communications”), by transmitting the Communications in an electronic/soft
medium in a format reasonably acceptable to the Administrative Agent at
Christopher.Gomes@UBS.com or at such other e-mail address(es) provided to
Administrative Borrower from time to time or in such other form, including hard
copy delivery thereof, as the Administrative Agent shall reasonably require.
Nothing in this Section 11.01(d) shall prejudice the right of the Agents, any
Lender or any Loan Party to give any notice or other communication pursuant to
this Agreement or any other Loan Document in any other manner specified in this
Agreement or any other Loan Document.
     To the extent consented to by the Administrative Agent from time to time,
Administrative Agent agrees that receipt of the Communications by the
Administrative Agent at its e-mail address(es) set forth above shall constitute
effective delivery of the Communications to the Administrative Agent for
purposes of the Loan Documents; provided that the Administrative Borrower shall
also deliver to the Administrative Agent an executed original of each Compliance
Certificate and an executed copy (which may be by pdf or similar electronic
transmission) of each notice or request of the type described in clauses
(i) through (iv) of paragraph (d) above required to be delivered hereunder.
     Each Loan Party further agrees that Administrative Agent may make the
Communications available to the Lenders by posting the Communications on
Intralinks or a substantially similar electronic transmission system (the
“Platform”). The Platform is provided “as is” and “as available.” The Agents do
not warrant the accuracy or completeness of the Communications, or the adequacy
of the Platform and expressly disclaim liability for errors or omissions in the
communications. No warranty of any kind, express, implied or statutory,
including, without limitation, any warranty of merchantability, fitness for a
particular purpose, non-infringement of third party rights or freedom from
viruses or other code defects, is made by any Agent in connection with the
Communications or the Platform. In no event shall the Administrative Agent or
any of its Related Parties have any liability to the Loan Parties, any Lender or
any other person for damages of any kind, including direct or indirect, special,
incidental or consequential damages, losses or expenses (whether in tort,
contract or otherwise) arising out of any Loan Party’s or the Administrative
Agent’s transmission of communications through the Internet, except to the
extent the liability of such person is found in a final non-
 

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appealable judgment by a court of competent jurisdiction to have resulted from
such person’s gross negligence or willful misconduct.
SECTION 11.02 Waivers; Amendment.
     (a) Generally. No failure or delay by any Agent or any Lender in exercising
any right or power hereunder or under any other Loan Document shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of each Agent and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of any Loan Document or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
this Section 11.02, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan shall not be construed as a
waiver of any Default, regardless of whether any Agent or any Lender may have
had notice or knowledge of such Default at the time. No notice or demand on any
Loan Party in any case shall entitle any Loan Party to any other or further
notice or demand in similar or other circumstances.
     (b) Required Consents. Subject to the terms of the Intercreditor Agreement
and to Section 11.02(c) and (d), neither this Agreement nor any other Loan
Document nor any provision hereof or thereof may be waived, amended,
supplemented or modified except, in the case of this Agreement, pursuant to an
agreement or agreements in writing entered into by the Borrowers and the
Required Lenders (or by the Administrative Agent with the written consent of the
Required Lenders) or, in the case of any other Loan Document, pursuant to an
agreement or agreements in writing entered into by the Administrative Agent (or,
in the case of any applicable Security Document, the Collateral Agent) and the
Loan Party or Loan Parties that are party thereto, in each case with the written
consent of the Required Lenders; provided that no such agreement shall be
effective if the effect thereof would:
          (i) increase the Commitment of any Lender without the written consent
of such Lender (it being understood that no amendment, modification,
termination, waiver or consent with respect to any condition precedent, covenant
or Default shall constitute an increase in the Commitment of any Lender);
          (ii) reduce the principal amount of any Loan or reduce the rate of
interest thereon (other than interest pursuant to Section 2.06(c)), or reduce
any Fees payable hereunder, or change the form or currency of payment of any
Obligation, without the written consent of each Lender directly affected
thereby;
          (iii) (A) change the scheduled final maturity of any Loan, or any
scheduled date of payment of or the installment otherwise due on the principal
amount of any Loan under Section 2.09, (B) postpone the date for payment of any
interest or fees payable hereunder, (C) change the amount of, waive or excuse
any such payment (other than waiver of any increase in the interest rate
pursuant to Section 2.06(c)), or (D) postpone the scheduled date of expiration
of any Commitment without the written consent of each Lender directly affected
thereby;
 

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          (iv) increase the maximum duration of Interest Periods hereunder,
without the written consent of each Lender directly affected thereby;
          (v) permit the assignment or delegation by any Borrower of any of its
rights or obligations under any Loan Document, without the written consent of
each Lender;
          (vi) except pursuant to the Intercreditor Agreement, release Holdings
or all or substantially all of the Subsidiary Guarantors from their Guarantees
(except as expressly provided in this Agreement or as otherwise expressly
provided by any such Guarantee), or limit their liability in respect of such
Guarantees, without the written consent of each Lender;
          (vii) except pursuant to the Intercreditor Agreement or the express
terms hereof, release all or a substantial portion of the Collateral from the
Liens of the Security Documents or alter the relative priorities of a material
portion of the Secured Obligations entitled to the Liens of the Security
Documents, in each case without the written consent of each Lender (it being
understood that additional Loans or Classes of Loans consented to by the
Required Lenders and additional Loans pursuant to Section 2.23 may be equally
and ratably secured by the Collateral with the then existing Secured Obligations
under the Security Documents);
          (viii) change Section 2.14(b), (c) or (d) in a manner that would alter
the pro rata sharing of payments or setoffs required thereby or any other
provision in a manner that would alter the pro rata allocation among the Lenders
of Loan disbursements, including the requirements of Section 2.02(a), without
the written consent of each Lender directly affected thereby (it being
understood that additional Loans or Classes of Loans consented to by the
Required Lenders and additional Loans pursuant to Section 2.23 may be equally
and ratably secured by the Collateral with the then existing Secured Obligations
under the Security Documents and may share payments and setoffs ratably with
other Loans);
          (ix) change any provision of this Section 11.02(b), (c), or (d),
without the written consent of each Lender directly affected thereby (except for
additional restrictions on amendments or waivers for the benefit of Lenders of
additional Loans or Classes of Loans consented to by the Required Lenders and
additional Loans pursuant to Section 2.23);
          (x) change the percentage set forth in the definition of “Required
Lenders” or any other provision of any Loan Document (including this Section)
specifying the number or percentage of Lenders (or Lenders of any Class)
required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender (or each Lender of such Class, as the case may be), other than to
increase such percentage or number or to give any additional Lender or group of
Lenders such right to waive, amend or modify or make any such determination or
grant any such consent;
          (xi) change the application of payments as among or between Classes
under Section 2.10(h), (i) or (j) or Section 8.03 without the written consent of
the Required Class Lenders of each Class that is being allocated a lesser
prepayment as a result thereof (it being understood that the Required Lenders
may waive, in whole or in part, any prepayment so long as the application, as
between Classes, of any portion of such prepayment that is still required to be
made is not changed and, if additional Loans or Classes of Loans under this
Agreement
 

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consented to by the Required Lenders or additional Loans pursuant to
Section 2.23 are made, such new Loans may be included on a pro rata basis in the
various payments required pursuant to Section 2.10(h), (i) and (j) and
Section 8.03); or
          (xii) change or waive any provision of ARTICLE X as the same applies
to any Agent, or any other provision hereof as the same applies to the rights or
obligations of any Agent, in each case without the written consent of such
Agent;
provided, further, that
     (1) any waiver, amendment or modification prior to the completion of the
primary syndication of the Commitments and Loans (as determined by the
Arrangers) may not be effected without the written consent of the Arrangers; and
     (2) any waiver, amendment or modification of the Intercreditor Agreement
(and any related definitions) may be effected by an agreement or agreements in
writing entered into among the Collateral Agent, the Administrative Agent, the
Revolving Credit Collateral Agent, the Revolving Credit Funding Agent and the
Revolving Credit Canadian Administrative Agent (in each case, with the consent
of the Required Lenders but without the consent of any Loan Party, so long as
such amendment, waiver or modification does not impose any additional duties or
obligations on the Loan Parties or alter or impair any right of any Loan Party
under the Loan Documents).
     (c) Collateral. Without the consent of any other person, the applicable
Loan Party or Parties and the Administrative Agent and/or Collateral Agent may
(in its or their respective sole discretion, or shall, to the extent required by
any Loan Document) enter into any amendment or waiver of any Loan Document, or
enter into any new agreement or instrument, to effect the granting, perfection,
protection, expansion or enhancement of any security interest in any Collateral
or additional property to become Collateral for the benefit of the Secured
Parties, or as required by local law to give effect to, or protect any security
interest for the benefit of the Secured Parties, in any property or so that the
security interests therein comply with applicable Requirements of Law.
     (d) Dissenting Lenders. If, in connection with any proposed change, waiver,
discharge or termination of the provisions of this Agreement as contemplated by
Section 11.02(b), the consent of the Required Lenders is obtained but the
consent of one or more of such other Lenders whose consent is required is not
obtained, then the Borrowers shall have the right, upon notice by Administrative
Borrower to such Lender and the Administrative Agent, to replace all, but not
less than all, of such non-consenting Lender or Lenders (so long as all
non-consenting Lenders are so replaced) with one or more persons pursuant to
Section 2.16 so long as at the time of such replacement each such new Lender
consents to the proposed change, waiver, discharge or termination. Each Lender
agrees that, if the Borrowers elect to replace such Lender in accordance with
this Section, it shall promptly execute and deliver to the Administrative Agent
an Assignment and Assumption to evidence such sale and purchase and shall
deliver to the Administrative Agent any Note (if Notes have been issued in
respect of such Lender’s Loans) subject to such Assignment and Assumption;
provided that the failure of any such non-consenting Lender to execute an
Assignment and Assumption shall not render such sale and
 

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purchase (and the corresponding assignment) invalid and such assignment shall be
recorded in the Register.
     (e) Holdings Amalgamation and Increased Commitments. Notwithstanding the
foregoing, the Administrative Agent and the Borrowers (without the consent of
any Lenders) may amend or amend and restate this Agreement and the other Loan
Documents if necessary or advisable in connection with or to effectuate (i) the
Permitted Holdings Amalgamation and (ii) any additional Loans contemplated by
Section 2.23.
SECTION 11.03 Expenses; Indemnity; Damage Waiver.
     (a) Costs and Expenses. Administrative Borrower shall pay or cause the
applicable Loan Party to pay (i) all reasonable out-of-pocket expenses incurred
by the Administrative Agent, the Collateral Agent, the Arrangers, and their
respective Affiliates (including the reasonable fees, charges and disbursements
of counsel for the Administrative Agent, and/or the Collateral Agent, expenses
incurred in connection with due diligence, inventory appraisal and collateral
audit and reporting fees, travel, courier, reproduction, printing and delivery
expenses, and the obtaining and maintaining of CUSIP numbers for the Loans) in
connection with the syndication of the credit facilities provided for herein,
the preparation, negotiation, execution, delivery and administration of this
Agreement and the other Loan Documents, or in connection with any amendment,
amendment and restatement, modification or waiver of the provisions hereof or
thereof (whether or not the transactions contemplated hereby or thereby shall be
consummated), including in connection with post-closing searches to confirm that
security filings and recordations have been properly made, (ii) all
out-of-pocket expenses incurred by the Administrative Agent, the Collateral
Agent, any Lender or any Receiver (including the fees, charges and disbursements
of any counsel for the Administrative Agent, the Collateral Agent, any Lender or
any Receiver), in connection with the enforcement or protection of its rights
(A) in connection with this Agreement and the other Loan Documents, including
its rights under this Section 11.03, (B) in enforcing, preserving and
protecting, or attempting to enforce, preserve or protect its interests in the
Collateral or (C) in connection with the Loans issued hereunder, including all
such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans and (iv) all documentary and similar taxes
and charges in respect of the Loan Documents.
     (b) Indemnification by Borrower. Each Loan Party shall indemnify the
Administrative Agent (and any sub-agent thereof), the Collateral Agent (and any
sub-agent thereof), each Lender and Receiver, and each Related Party of any of
the foregoing persons (each such person being called an “Indemnitee”) against,
and hold each Indemnitee harmless from, any and all reasonable out-of-pocket
losses, claims, damages, liabilities and related expenses (including the
reasonable fees, charges and disbursements of any counsel for any Indemnitee)
incurred by any Indemnitee or asserted against any Indemnitee by any third party
or by any Borrower or any other Loan Party arising out of, in connection with,
or as a result of (i) the execution or delivery of this Agreement, any other
Loan Document, or any amendment, amendment and restatement, modification or
waiver of the provisions hereof or thereof, or any agreement or instrument
contemplated hereby or thereby, the performance by the parties hereto of their
respective obligations hereunder or thereunder or the consummation of the
transactions contemplated hereby or thereby, (ii) any Loan or the use or
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therefrom, (iii) any actual or alleged presence or Release or threatened Release
of Hazardous Materials on, at, under or from any property owned, leased or
operated by any Company at any time, or any Environmental Claim related in any
way to any Company, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by any
Borrower or any other Loan Party, and regardless of whether any Indemnitee is a
party thereto; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses (x) are determined by a court of competent jurisdiction by
final and nonappealable judgment to have resulted from the gross negligence or
willful misconduct of such Indemnitee or (y) result from a claim brought by any
Borrower or any other Loan Party against an Indemnitee for breach in bad faith
of such Indemnitee’s obligations hereunder or under any other Loan Document, if
such Borrower or such Loan Party has obtained a final and nonappealable judgment
in its favor on such claim as determined by a court of competent jurisdiction.
WITHOUT LIMITATION OF THE FOREGOING, IT IS THE INTENTION OF THE LOAN PARTIES,
AND THE LOAN PARTIES AGREE, THAT THE FOREGOING INDEMNITIES SHALL APPLY TO EACH
INDEMNITEE WITH RESPECT TO LOSSES, CLAIMS, DAMAGES, PENALTIES, LIABILITIES AND
RELATED EXPENSES (INCLUDING, WITHOUT LIMITATION, ALL EXPENSES OF LITIGATION OR
PREPARATION THEREFOR), WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF
THE NEGLIGENCE OF SUCH (AND/OR ANY OTHER) INDEMNITEE.
     (c) Reimbursement by Lenders. To the extent that any Loan Party for any
reason fails to indefeasibly pay any amount required under paragraph (a) or
(b) of this Section 11.03 to be paid by it to the Administrative Agent (or any
sub-agent thereof), the Collateral Agent or any Receiver or any Related Party of
any of the foregoing, each Lender severally agrees to pay to the Administrative
Agent (or any such sub-agent), the Collateral Agent (or any sub-agent thereof),
such Receiver or such Related Party, as the case may be, such Lender’s pro rata
share (determined as of the time that the applicable unreimbursed expense or
indemnity payment is sought) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent), the Collateral Agent (or any
sub-agent thereof) or the Receiver, in each case, in its capacity as such, or
against any Related Party of any of the foregoing acting for the Administrative
Agent (or any such sub-agent), the Collateral Agent (or any sub-agent thereof)
or the Receiver in connection with such capacity. The obligations of the Lenders
under this paragraph (c) are subject to the provisions of Section 2.14. For
purposes hereof, a Lender’s “pro rata share” shall be determined based upon its
share of the sum of the total outstanding Term Loans and unused Commitments of
all Lenders at the time.
     (d) Waiver of Consequential Damages, Etc. To the fullest extent permitted
by applicable Requirements of Law, no Loan Party shall assert, and each Loan
Party hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement, any other Loan Document or any agreement or instrument
contemplated hereby, the transactions contemplated hereby or thereby, any Loan
or the use of the proceeds thereof. No Indemnitee referred to in paragraph
(b) above shall be liable for any damages arising from the use by unintended
recipients of any information or other materials
 

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distributed by it through telecommunications, electronic or other information
transmission systems in connection with this Agreement or the other Loan
Documents or the transactions contemplated hereby or thereby.
     (e) Payments. All amounts due under this Section shall be payable not later
than three (3) Business Days after demand therefore accompanied by reasonable
particulars of amounts due.
SECTION 11.04 Successors and Assigns.
     (a) Successors and Assigns Generally. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that no Loan Party
may (except as a result of a transaction expressly permitted by Section 6.05(c)
or 6.05(e)) assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of the Administrative Agent, the
Collateral Agent and each Lender and no Lender may assign or otherwise transfer
any of its rights or obligations hereunder except (i) to an Eligible Assignee in
accordance with the provisions of paragraph (b) of this Section 11.04, (ii) by
way of participation in accordance with the provisions of paragraph (d) of this
Section 11.04 or (iii) by way of pledge or assignment of a security interest
subject to the restrictions of paragraph (f) of this Section (and any other
attempted assignment or transfer by any Borrower or any Lender shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants to the extent provided in
paragraph (d) of this Section and, to the extent expressly contemplated hereby,
the other Indemnitees) any legal or equitable right, remedy or claim under or by
reason of this Agreement.
     (b) Assignments by Lenders. Any Lender may at any time assign to one or
more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans at
the time owing to it); provided that
          (i) except in the case of any assignment made in connection with the
primary syndication of the Commitment and Loans by the Arrangers up to three
(3) months after the Closing Date or an assignment of the entire remaining
amount of the assigning Lender’s Commitment and the Loans at the time owing to
it or in the case of an assignment to a Lender or an Affiliate of a Lender or an
Approved Fund with respect to a Lender, the aggregate amount of the Commitment
(which for this purpose includes Loans outstanding thereunder) or, if the
applicable Commitment is not then in effect, the principal outstanding balance
of the Loans of the assigning Lender subject to each such assignment (determined
as of the date the Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent or, if “Trade Date” is specified in the
Assignment and Assumption, as of the Trade Date) shall be an integral multiple
of $1 million (provided that in the case of a simultaneous assignment by any
assigning Lender of U.S. Term Loans and Canadian Term Loans held by such Lender,
the principal outstanding balance of such Loans subject to such assignment shall
be aggregated for purposes of determining such minimum assignment amount),
unless each of the Administrative Agent and, so long as no Event of Default has
occurred and is continuing, Administrative Borrower otherwise consents (each
such consent not to be unreasonably withheld or delayed);
 

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          (ii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender’s rights and obligations under
this Agreement with respect to the Loan or the Commitment assigned, except that
this clause (ii) shall not prohibit any Lender from assigning all or a portion
of its rights and obligations among separate Classes on a non-pro rata basis;
and
          (iii) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with (except in the
case of any such assignments by the Arrangers or their Affiliates) a processing
and recordation fee of $3,500 (provided that only one such fee shall be imposed
in the case of simultaneous assignments by related Approved Funds or Affiliates
of the assigning Lender), and the Eligible Assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.
Subject to acceptance and recording thereof by the Administrative Agent pursuant
to paragraph (c) of this Section 11.04, from and after the effective date
specified in each Assignment and Assumption, the Eligible Assignee thereunder
shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Section 2.12, Section 2.13, Section 2.15,
Section 2.16, Section 7.10 and Section 11.03 with respect to facts and
circumstances occurring prior to the effective date of such assignment. No
assignment shall be or shall be deemed to be a discharge, recission,
extinguishment, novation or substitution of any Loan and any Loan assigned in
accordance with this Section 11.04 shall continue to be the same obligation and
not a new obligation. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this paragraph shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (d) of
this Section 11.04. In the event of a transfer by novation of all or part of its
rights and obligations under this Agreement by a Lender, such Lender expressly
reserves the rights, powers, privileges and actions that it enjoys under any
Security Documents governed by French law in favor of its Eligible Assignee, in
accordance with the provisions of article 1278 et seq. of the French Code civil.
     (c) Register. The Administrative Agent, acting solely for this purpose as
an agent of the Borrowers, shall, at all times at one of its offices in
Stamford, Connecticut, while any Loans are outstanding, maintain a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amounts of the Loans owing to, each Lender pursuant to the terms hereof from
time to time (the “Register”). The entries in the Register shall be conclusive,
and the Borrowers, the Administrative Agent and the Lenders shall treat each
person whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary. The Register shall be available for inspection by the Borrowers,
the Collateral Agent and any Lender (with respect to its own interest only), at
any reasonable time and from time to time upon reasonable prior notice. The
requirements of this Section 11.04(c) are intended to result in any and all
Loans being in “registered form” for
 

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purposes of Section 871, Section 881 and any other applicable provision of the
Code, and shall be interpreted and applied in a manner consistent therewith.
     (d) Participations. Any Lender may at any time, without the consent of, or
notice to, any Borrower or the Administrative Agent sell participations to any
person (other than a natural person or any Borrower, any of any Borrower’s or
any other Company’s Affiliates or Subsidiaries) (each, a “Participant”) in all
or a portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans owing to it);
provided that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) each Loan Party, the
Administrative Agent and the Lenders shall continue to deal solely and directly
with such Lender in connection with such Lender’s rights and obligations under
this Agreement.
     Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce the Loan Documents and to approve any amendment, modification or waiver
of any provision of the Loan Documents; provided that such agreement or
instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver described in clause
(i), (ii) or (iii) of the first proviso to Section 11.02(b) that affects such
Participant. Subject to paragraph (e) of this Section, each Borrower agrees that
each Participant shall be entitled to the benefits of Section 2.12,
Section 2.13, Section 2.15, Section 2.16 and Section 7.10 (subject to the
requirements of those Sections) to the same extent as if it were a Lender and
had acquired its interest by assignment pursuant to paragraph (b) of this
Section. To the extent permitted by law, each Participant also shall be entitled
to the benefits of Section 11.08 as though it were a Lender, provided such
Participant agrees to be subject to such sections (as applicable) as though it
were a Lender.
     (e) Limitations on Participant Rights. A Participant shall not be entitled
to receive any greater payment under Section 2.12, Section 2.13, Section 2.15,
Section 2.16 and Section 7.10 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with
Administrative Borrower’s prior written consent.
     (f) Certain Pledges. Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto. In
the case of any Lender that is a fund that invests in bank loans, such Lender
may, without the consent of any Loan Party or the Administrative Agent,
collaterally assign or pledge all or any portion of its rights under this
Agreement, including the Loans and Notes or any other instrument evidencing its
rights as a Lender under this Agreement, to any holder of, trustee for, or any
other representative of holders of, obligations owed or securities issued, by
such fund, as security for such obligations or securities.
 

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     (g) Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be
deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable Requirement of Law, including the Federal Electronic Signatures
in Global and National Commerce Act, the New York State Electronic Signatures
and Records Act, or any other similar state laws based on the Uniform Electronic
Transactions Act.
SECTION 11.05 Survival of Agreement. All covenants, agreements, representations
and warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement or any other Loan Document shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of the Loan Documents and the making of any Loans, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that the Agents or any Lender may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any fee or any other amount payable
under this Agreement is outstanding and unpaid or any Commitments have not
expired or terminated. The provisions of Section 2.12, Section 2.14,
Section 2.15, Section 2.16 and ARTICLE X shall survive and remain in full force
and effect regardless of the consummation of the transactions contemplated
hereby, the repayment of the Loans, the expiration or termination of the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 11.06 Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and the other
Loan Documents and any separate letter agreements with respect to fees payable
to any Agent or the Arrangers (and any provisions of any other letter agreements
among Canadian Borrower, the Arrangers ABN AMRO, and UBS Loan Finance LLC that
are explicitly stated to survive the execution and delivery of this Agreement)
(which surviving obligations are hereby assumed by the Borrowers), constitute
the entire contract among the parties relating to the subject matter hereof and
supersede any and all previous agreements and understandings, oral or written,
relating to the subject matter hereof. Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto. Delivery of an executed counterpart of a signature
page of this Agreement by telecopier shall be effective as delivery of a
manually executed counterpart of this Agreement. THIS WRITTEN AGREEMENT
REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED
BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
SECTION 11.07 Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
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extent of such invalidity, illegality or unenforceability without affecting the
validity, legality and enforceability of the remaining provisions hereof; and
the invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.
SECTION 11.08 Right of Setoff. Subject to the Intercreditor Agreement, if an
Event of Default shall have occurred and be continuing, each Lender and each of
their respective Affiliates is hereby authorized at any time and from time to
time, to the fullest extent permitted by applicable Requirements of Law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender or any such
Affiliate to or for the credit or the account of any Borrower or any other Loan
Party against any and all of the obligations of such Borrower or such Loan Party
now or hereafter existing under this Agreement or any other Loan Document to
such Lender, irrespective of whether or not such Lender shall have made any
demand under this Agreement or any other Loan Document and although such
obligations of such Borrower or such Loan Party may be contingent or unmatured
or are owed to a branch or office of such Lender different from the branch or
office holding such deposit or obligated on such indebtedness. The rights of
each Lender and their respective Affiliates under this Section are in addition
to other rights and remedies (including other rights of setoff) that such Lender
or its respective Affiliates may have. Each Lender agrees to notify
Administrative Borrower and the Administrative Agent promptly after any such
setoff and application; provided that the failure to give such notice shall not
affect the validity of such setoff and application.
SECTION 11.09 Governing Law; Jurisdiction; Consent to Service of Process.
     (a) Governing Law. This Agreement shall be construed in accordance with and
governed by the law of the State of New York, without regard to conflicts of law
principles that would require the application of the laws of another
jurisdiction.
     (b) Submission to Jurisdiction. Each Loan Party hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to any Loan Document, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State court or, to the
fullest extent permitted by applicable law, in such Federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement or
any other Loan Document shall affect any right that any Agent or any Lender may
otherwise have to bring any action or proceeding relating to this Agreement or
any other Loan Document against any Loan Party or its properties in the courts
of any jurisdiction.
     (c) Waiver of Venue. Each Loan Party hereby irrevocably and unconditionally
waives, to the fullest extent permitted by applicable Requirements of Law, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any other
Loan Document in any court referred to in Section
 

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11.09(b). Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by applicable Requirements of Law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.
     (d) Service of Process. Each party hereto irrevocably consents to service
of process in any action or proceeding arising out of or relating to any Loan
Document, in the manner provided for notices (other than telecopier, e-mail or
other electronic transmission) in Section 11.01. Each Loan Party hereby
irrevocably designates, appoints and empowers CSC Corporation, 1133 Ave of the
Americas, Suite 3100, New York, New York, 10036 (telephone no: 212-299-5600)
(telecopy no: 212-299-5656) (electronic mail address: jbudhu@cscinfo.com) (the
“Process Agent”), in the case of any suit, action or proceeding brought in the
United States of America as its designee, appointee and agent to receive, accept
and acknowledge for and on its behalf, and in respect of its property, service
of any and all legal process, summons, notices and documents that may be served
in any action or proceeding arising out of or in connection with this Agreement
or any Loan Document. Nothing in this Agreement or any other Loan Document will
affect the right of any party hereto to serve process in any other manner
permitted by applicable Requirements of Law.
SECTION 11.10 Waiver of Jury Trial. Each Loan Party hereby waives, to the
fullest extent permitted by applicable Requirements of Law, any right it may
have to a trial by jury in any legal proceeding directly or indirectly arising
out of or relating to this Agreement, any other Loan Document or the
transactions contemplated hereby (whether based on contract, tort or any other
theory). Each party hereto (a) certifies that no representative, agent or
attorney of any other party has represented, expressly or otherwise, that such
other party would not, in the event of litigation, seek to enforce the foregoing
waiver and (b) acknowledges that it and the other parties hereto have been
induced to enter into this Agreement by, among other things, the mutual waivers
and certifications in this Section.
SECTION 11.11 Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 11.12 Treatment of Certain Information; Confidentiality. Each Agent and
each Lender agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its Affiliates
and to its and its Affiliates’ respective partners, directors, officers,
employees, agents, advisors and other representatives (it being understood that
the persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority
purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable Requirements of Law or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or
the enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section 11.12, to
(i) any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement, (ii) any
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prospective counterparty (or its advisors) to any swap or derivative transaction
relating to any Loan Party and its obligations or (iii) any rating agency for
the purpose of obtaining a credit rating applicable to any Lender, (g) with the
consent of Administrative Borrower or the applicable Loan Party or (h) to the
extent such Information (x) becomes publicly available other than as a result of
a breach of this Section or (y) becomes available to the Administrative Agent,
any Lender or any of their respective Affiliates on a nonconfidential basis from
a source other than the Loan Parties. For purposes of this Section,
“Information” means all information received from a Loan Party or any of its
Subsidiaries relating to the Loan Parties or any of their Subsidiaries or any of
their respective businesses, other than any such information that is available
to any Agent or any Lender on a nonconfidential basis prior to disclosure by any
Loan Party or any of their Subsidiaries. Any person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such person has exercised the
same degree of care to maintain the confidentiality of such Information as such
person would accord to its own confidential information.
SECTION 11.13 USA PATRIOT Act Notice. Each Lender that is subject to the Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrowers and the other Loan Parties that
pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”), it is required to obtain,
verify and record information that identifies the Borrowers and the other Loan
Parties, which information includes the name, address and tax identification
number of the Borrowers and the other Loan Parties and other information
regarding the Borrowers and the other Loan Parties that will allow such Lender
or the Administrative Agent, as applicable, to identify the Borrowers and the
other Loan Parties in accordance with the Act. This notice is given in
accordance with the requirements of the Act and is effective as to the Lenders
and the Administrative Agent.
SECTION 11.14 Interest Rate Limitation. Notwithstanding anything to the contrary
contained herein, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable Requirements of Law (collectively, the “Charges”),
shall exceed the maximum lawful rate (the “Maximum Rate”) which may be
contracted for, charged, taken, received or reserved by the Lender holding such
Loan in accordance with applicable Requirements of Law, the rate of interest
payable in respect of such Loan hereunder, together with all Charges payable in
respect thereof, shall be limited to the Maximum Rate and, to the extent lawful,
the interest and Charges that would have been payable in respect of such Loan
but were not payable as a result of the operation of this Section shall be
cumulated and the interest and Charges payable to such Lender in respect of
other Loans or periods shall be increased (but not above the Maximum Rate
therefor) until such cumulated amount, together with interest thereon at the
Interbank Rate to the date of repayment, shall have been received by such
Lender.
SECTION 11.15 Lender Addendum. Each Lender to become a party to this Agreement
on the date hereof shall do so by delivering to the Administrative Agent a
Lender Addendum duly executed by such Lender, Administrative Borrower and the
Administrative Agent.
 

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SECTION 11.16 Obligations Absolute. To the fullest extent permitted by
applicable Requirements of Law, all obligations of the Loan Parties hereunder
shall be absolute and unconditional irrespective of:
     (a) any bankruptcy, insolvency, reorganization, arrangement, readjustment,
composition, liquidation or the like of any Loan Party;
     (b) any lack of validity or enforceability of any Loan Document or any
other agreement or instrument relating thereto against any Loan Party;
     (c) any change in the time, manner or place of payment of, or in any other
term of, all or any of the Obligations, or any other amendment or waiver of or
any consent to any departure from any Loan Document or any other agreement or
instrument relating thereto;
     (d) any exchange, release or non-perfection of any other Collateral, or any
release or amendment or waiver of or consent to any departure from any
guarantee, for all or any of the Obligations;
     (e) any exercise or non-exercise, or any waiver of any right, remedy, power
or privilege under or in respect hereof or any Loan Document; or
     (f) any other circumstances which might otherwise constitute a defense
available to, or a discharge of, the Loan Parties.
SECTION 11.17 Intercreditor Agreement. Notwithstanding anything to the contrary
contained herein, each Lender acknowledges that the Lien and security interest
granted to the Collateral Agent pursuant to the Security Documents and the
exercise of any right or remedy by such Collateral Agent thereunder are subject
to the provisions of the Intercreditor Agreement. In the event of any conflict
between the terms of the Intercreditor Agreement and the Security Documents, the
terms of the Intercreditor Agreement shall govern and control.
SECTION 11.18 Judgment Currency.
(a) Each Loan Party’s obligations hereunder and under the other Loan Documents
to make payments in Dollars (the “Obligation Currency”) shall not be discharged
or satisfied by any tender or recovery pursuant to any judgment expressed in or
converted into any currency other than the Obligation Currency, except to the
extent that such tender or recovery results in the effective receipt by the
Administrative Agent or the respective Lender of the full amount of the
Obligation Currency expressed to be payable to the Administrative Agent or such
Lender under this Agreement or the other Loan Documents. If, for the purpose of
obtaining or enforcing judgment against any Loan Party in any court or in any
jurisdiction, it becomes necessary to convert into or from any currency other
than the Obligation Currency (such other currency being hereinafter referred to
as the “Judgment Currency”) an amount due in the Obligation Currency, the
conversion shall be made at the spot selling rate at which the Administrative
Agent (or if the Administrative Agent does not quote a rate of exchange on such
currency, by a known dealer in such currency designated by the Administrative
Agent) offers to sell such Judgment Currency for the Obligation Currency in the
London foreign exchange market at approximately 11:00 a.m. London time on such
date for delivery two (2) Business Days later (such date of determination of
 

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such spot selling rate, being hereinafter referred to as the “Judgment Currency
Conversion Date”).
     (b) If there is a change in the rate of exchange prevailing between the
Judgment Currency Conversion Date and the date of actual payment of the amount
due, each Borrower covenants and agrees to pay, or cause to be paid, such
additional amounts, if any (but in any event not a lesser amount) as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate of exchange prevailing on the Judgment Currency Conversion
Date.
     (c) For purposes of determining any rate of exchange for this
Section 11.18, such amounts shall include any premium and costs payable in
connection with the purchase of the Obligation Currency.
SECTION 11.19 [INTENTIONALLY OMITTED].
SECTION 11.20 [INTENTIONALLY OMITTED].
SECTION 11.21 Abstract Acknowledgment of Indebtedness and Joint Creditorship.
     (a) Notwithstanding any other provision of this Agreement, each Loan Party
hereby irrevocably and unconditionally agrees and covenants with the Collateral
Agent by way of an abstract acknowledgment of indebtedness (abstraktes
Schuldversprechen) that it owes to the Collateral Agent as creditor in its own
right and not as a representative of the other Secured Parties, sums equal to,
and in the currency of, each amount payable by such Loan Party to each of the
Secured Parties under each of the Loan Documents relating to any Secured
Obligations, as and when that amount falls due for payment under the relevant
Secured Debt Agreement or would have fallen due but for any discharge resulting
from failure of another Secured Party to take appropriate steps, in insolvency
proceedings affecting such Loan Party, to preserve its entitlement to be paid
that amount.
     (b) Each Loan Party undertakes to pay to the Collateral Agent upon first
written demand the amount payable by such Loan Party to each of the Secured
Parties under each of the Secured Debt Agreements as such amount has become due
and payable.
     (c) The Collateral Agent has the independent right to demand and receive
full or partial payment of the amounts payable by each Loan Party under this
Section 11.21, irrespective of any discharge of such Loan Party’s obligation to
pay those amounts to the other Secured Parties resulting from failure by them to
take appropriate steps, in insolvency proceedings affecting such Loan Party, to
preserve their entitlement to be paid those amounts.
     (d) Any amount due and payable by a Loan Party to the Collateral Agent
under this Section 11.21 shall be decreased to the extent that the other Secured
Parties have received (and are able to retain) payment in full of the
corresponding amount under the other provisions of the Secured Debt Agreements
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Parties under those provisions shall be decreased to the extent that the
Collateral Agent has received (and is able to retain) payment in full of the
corresponding amount under this Section 11.21; provided that no Loan Party may
consider its obligations towards a Secured Party to be so discharged by virtue
of any set-off, counterclaim or similar defense that it may invoke vis-à-vis the
Collateral Agent.
     (e) The rights of the Secured Parties (other than the Collateral Agent) to
receive payment of amounts payable by each Loan Party under the Secured Debt
Agreements are several and are separate and independent from, and without
prejudice to, the rights of the Collateral Agent to receive payment under this
Section 11.21.
     (f) In addition, but without prejudice to the foregoing, the Collateral
Agent shall be the joint creditor (together with the relevant Secured Parties)
of all obligations of each Loan Party towards each of the Secured Parties under
the Secured Debt Agreements.
SECTION 11.22 Special Appointment of Collateral Agent for German Security.
     (a) (i) Each Lender that is or will become party to this Agreement hereby
appoints the Collateral Agent as trustee (Treuhaender) and administrator for the
purpose of holding on trust (Treuhand), administering, enforcing and releasing
the German Security (as defined below) for the Secured Parties, (ii) the
Collateral Agent accepts its appointment as a trustee and administrator of the
German Security on the terms and subject to the conditions set out in this
Agreement and (iii) the Lenders, the Collateral Agent and all other parties to
this Agreement agree that, in relation to the German Security, no Lender shall
exercise any independent power to enforce any German Security or take any other
action in relation to the enforcement of the German Security, or make or receive
any declarations in relation thereto.
     (b) To the extent possible, the Collateral Agent shall hold and administer
any German Security which is security assigned, transferred or pledged under
German law to it as a trustee for the benefit of the Secured Parties, where
“German Security” means the assets which are the subject of a security document
which is governed by German law.
     (c) Each Lender hereby authorizes and instructs the Collateral Agent (with
the right of sub delegation) to enter into any documents evidencing German
Security and to make and accept all declarations and take all actions as it
considers necessary or useful in connection with any German Security on behalf
of the Secured Parties. The Collateral Agent shall further be entitled to
rescind, release, amend and/or execute new and different documents securing the
German Security.
     (d) The Lenders and the Collateral Agent agree that all rights and claims
constituted by the abstract acknowledgment of indebtedness pursuant to this
Section 11.22 and all proceeds held by the Collateral Agent pursuant to or in
connection with such abstract acknowledgment of indebtedness are held by the
Collateral Agent with effect from the date of such abstract acknowledgment of
indebtedness in trust for the Secured Parties and will be administered in
accordance with the Loan Documents. The Secured Parties and the Collateral Agent
agree further that the respective Loan Party’s obligations under such abstract
acknowledgment of indebtedness shall not increase the total amount of the
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respective agreement governing German Security) and shall not result in any
additional liability of any of the Loan Parties or otherwise prejudice the
rights of any of the Loan Parties. Accordingly, payment of the obligations under
such abstract acknowledgment of indebtedness shall, to the same extent,
discharge the corresponding Secured Obligations and vice versa.
SECTION 11.23 Special Appointment of Administrative Agent in Relation to South
Korea.
     (a) Notwithstanding any other provision of this Agreement, each Loan Party
hereby irrevocably and unconditionally undertakes to pay to the Administrative
Agent, as creditor in its own right and not as representative of the other
Secured Parties, sums equal to and in the currency of each amount payable by
such Loan Party to each of the Secured Parties under each of the Loan Documents
as and when that amount falls due for payment under the relevant Loan Document
or would have fallen due but for any discharge resulting from failure of another
Secured Party to take appropriate steps, in insolvency proceedings affecting
that Loan Party, to preserve its entitlement to be paid that amount.
     (b) The Administrative Agent shall have its own independent right to demand
payment of the amounts payable by each Loan Party under this Section 11.23,
irrespective of any discharge of such Loan Party’s obligation to pay those
amounts to the Secured Parties resulting from failure by them to take
appropriate steps, in insolvency proceedings affecting that Loan Party, to
preserve their entitlement to be paid those amounts.
     (c) Any amount due and payable by a Loan Party to the Administrative Agent
under this Section 11.23 shall be decreased to the extent that the other Secured
Parties have received (and are able to retain) payment in full of the
corresponding amount under the other provisions of the Loan Documents and any
amount due and payable by a Loan Party to the other Secured Parties under those
provisions shall be decreased to the extent that the Administrative Agent has
received (and is able to retain) payment in full of the corresponding amount
under this Section 11.23.
     (d) Subject to paragraph (c) above, the rights of the Secured Parties (in
each case, other than the Administrative Agent) to receive payment of amounts
payable by each Loan Party under the Loan Documents are several and are separate
and independent from, and without prejudice to, the rights of the Administrative
Agent to receive payment under this Section 11.23.
SECTION 11.24 Designation of Collateral Agent under Civil Code of Quebec. Each
of the parties hereto (including each Lender, acting for itself and on behalf of
each of its Affiliates which are or become Secured Parties from time to time)
confirms the appointment and designation of the Collateral Agent (or any
successor thereto) as the person holding the power of attorney (fondé de
pouvoir) within the meaning of Article 2692 of the Civil Code of Québec for the
purposes of the hypothecary security to be granted by the Loan Parties or any
one of them under the laws of the Province of Québec and, in such capacity, the
Collateral Agent shall hold the hypothecs granted under the laws of the Province
of Québec as such fondé de pouvoir in the exercise of the rights conferred
thereunder. The execution by the Collateral Agent in its capacity as fondé de
pouvoir prior to the date hereof of any document creating or evidencing any such
hypothecs is hereby ratified and confirmed. Notwithstanding the provisions of
Section 32 of the
 

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Act respecting the special powers of legal persons (Québec), the Collateral
Agent may acquire and be the holder of any of the bonds secured by any such
hypothec. Each future Secured Party, whether a Lender or any other holder of any
Secured Obligation, shall be deemed to have ratified and confirmed (for itself
and on behalf of each of its Affiliates that are or become Secured Parties from
time to time) the appointment of the Collateral Agent as fondé de pouvoir.
SECTION 11.25 Maximum Liability. Subject to Section 7.08 and Sections 7.11
through 7.14, it is the desire and intent of (i) each Loan Party and the
Lenders, that, in each case, the liability of such Loan Party shall be enforced
against such Loan Party to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is sought
after giving effect to the rights of contribution established in the
Contribution, Intercompany, Contracting and Offset Agreement that are valid and
enforceable and not subordinated to the claims of other creditors as determined
in such action or proceeding. If, however, and to the extent that, the
obligations of any Loan Party under any Loan Document shall be adjudicated to be
invalid or unenforceable for any reason (including, without limitation, because
of any applicable state, provincial or federal law relating to fraudulent
conveyances or transfers), then the amount of such Loan Party’s obligations (in
the case of any invalidity or unenforceability with respect such Loan Party’s
obligations) under the Loan Documents shall be deemed to be reduced and such
Loan Party shall pay the maximum amount of the Secured Obligations which would
be permissible under applicable law; provided that any guarantees of any such
obligations that are subject to deemed reduction pursuant to this Section 11.25
shall, to the fullest extent permitted by applicable Requirements of Law, be
absolute and unconditional in respect of the full amount of such obligations
without giving effect to any such deemed reduction.
[Signature Pages Follow]

     
 
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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.

            NOVELIS INC., as Canadian Borrower
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Vice President and Treasurer         NOVELIS CORPORATION, as U.S. Borrower
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory         NOVELIS PAE CORPORATION, as U.S. Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory         NOVELIS FINANCES USA LLC, as U.S. Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory         NOVELIS SOUTH AMERICA HOLDINGS LLC, as U.S.
Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Vice President and Treasurer      

 

S-1

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            ALUMINUM UPSTREAM HOLDINGS LLC, as U.S. Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Vice President and Treasurer      

 

S-2

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            NOVELIS UK LTD, as U.K. Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory         NOVELIS AG, as Swiss Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory         NOVELIS CAST HOUSE TECHNOLOGY LTD.,
as Canadian Guarantor         By:   /s/ Orville Lunking       Name:   Orville
Lunking       Title:   Authorized Signatory         4260848 CANADA INC., as
Canadian Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory         4260856 CANADA INC., as Canadian Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory      

 

S-3

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            NOVELIS NO. 1 LIMITED PARTNERSHIP, as
Canadian Guarantor,
      By: 4260848 CANADA INC.     Its: General Partner          By:   /s/
Orville Lunking       Name:   Orville Lunking       Title:   Authorized
Signatory         NOVELIS EUROPE HOLDINGS LIMITED, as U.K. Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory         NOVELIS SWITZERLAND SA, as Swiss Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory         NOVELIS TECHNOLOGY AG, as Swiss Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory      

 

S-4

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            AV ALUMINUM INC., as Guarantor
      By:   /s/ Orville Lunking       Name:   Orville Lunking       Title:  
Authorized Signatory      

     
 
  S-5

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            NOVELIS DEUTSCHLAND GMBH, as German Guarantor
      By:   /s/ Gottfried Weindl       Name:   Gottfried Weindl       Title:  
Managing Director      

     
 
  S-6

 

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            NOVELIS DO BRASIL LTDA., as Brazilian Guarantor
      By:   /s/ Tadeu Nardocci       Name:   Antonio Tadeu Coelho Nardocci      
Title:   Presidente          
      By:   /s/ Alexandre Almeida       Name:   Alexandre M. Almeida      
Title:   Diretor Financeiro  

     
 
  S-7

 

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            Present when the Common Seal of

NOVELIS ALUMINIUM HOLDING COMPANY,

As Irish Guarantor,

was hereunto affixed in the presence of:

      Name:   /s/ Andreas Thiele     Title:   Duly appointed attorney        
Name:   /s/ Eva Paus-Werdermann     Title:   Assistant to Legal Counsel  

     
 
  S-8

 

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            UBS AG, STAMFORD BRANCH, as
Administrative Agent and as Collateral Agent
      By:   /s/ Mary E. Evans       Name:   Mary E. Evans       Title:  
Associate Director               By:   /s/ David Julie       Name:   David B.
Julie       Title:   Associate Director         UBS SECURITIES LLC, as Joint
Lead Arranger
and Joint Bookmanager
      By:   /s/ Mary E. Evans       Name:   Mary E. Evans       Title:  
Associate Director               By:   /s/ David Julie       Name:   David B.
Julie       Title:   Associate Director      

     
 
  S-9

 

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            UBS SECURITIES LLC, as Syndication Agent
      By:   /s/ Mary E. Evans       Name:   Mary E. Evans       Title:  
Associate Director               By:   /s/ Irja R. Otsa       Name:   Irja R.
Otsa       Title:   Associate Director      

     
 
  S-10

 

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            ABN AMRO INCORPORATED, as Joint Lead
Arranger and Joint Bookmanager
      By:   /s/ David Wood       Name:   David Wood       Title:   Managing
Director      

     
 
  S-11

 

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            ABN AMRO INCORPORATED, as
Documentation Agent
      By:   /s/ David Wood       Name:   David Wood       Title:   Managing
Director      

     
 
  S-12

 

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Annex I
Applicable Margin

          Eurocurrency U.S. Term Loans and   ABR U.S. Term Loans and ABR
Canadian Eurocurrency Canadian Term Loans   Term Loans
 
       
2.00%
    1.00 %

 

 

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Annex II
Amortization Table

                  Canadian Term Loan Date   U.S. Term Loan Amount   Amount      
    September 30, 2007   $1,650,000   $750,000           December 31, 2007  
$1,650,000   $750,000           March 31, 2008   $1,650,000   $750,000          
June 30, 2008   $1,650,000   $750,000           September 30, 2008   $1,650,000
  $750,000           December 31, 2008   $1,650,000   $750,000          
March 31, 2009   $1,650,000   $750,000           June 30, 2009   $1,650,000  
$750,000           September 30, 2009   $1,650,000   $750,000          
December 31, 2009   $1,650,000   $750,000           March 31, 2010   $1,650,000
  $750,000           June 30, 2010   $1,650,000   $750,000          
September 30, 2010   $1,650,000   $750,000           December 31, 2010  
$1,650,000   $750,000           March 31, 2011   $1,650,000   $750,000          
June 30, 2011   $1,650,000   $750,000           September 30, 2011   $1,650,000
  $750,000           December 31, 2011   $1,650,000   $750,000          
March 31, 2012   $1,650,000   $750,000

 

 

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                  Canadian Term Loan Date   U.S. Term Loan Amount   Amount      
    June 30, 2012   $1,650,000   $750,000           September 30, 2012  
$1,650,000   $750,000           December 31, 2012   $1,650,000   $750,000      
    March 31, 2013   $1,650,000   $750,000           June 30, 2013   $1,650,000
  $750,000           September 30, 2013   $1,650,000   $750,000          
December 31, 2013   $1,650,000   $750,000           March 31, 2014   $1,650,000
  $750,000           June 30, 2014   $1,650,000   $750,000           Final
Maturity Date   Remaining outstanding principal   Remaining outstanding
principal

 

 

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Annex III
Mandatory Cost Formula
     1. The Mandatory Cost is an addition to the interest rate to compensate
Lenders for the cost of compliance with (a) the requirements of the Bank of
England and/or the Financial Services Authority (or, in either case, any other
authority which replaces all or any of its functions) or (b) the requirements of
the European Central Bank.
     2. On the first day of each Interest Period (or as soon as possible
thereafter) the Administrative Agent shall calculate, as a percentage rate, a
rate (the “Additional Cost Rate”) for each Lender, in accordance with the
paragraphs set out below. The Mandatory Cost will be calculated by the
Administrative Agent as a weighted average of the Lenders’ Additional Cost Rates
(weighted in proportion to the percentage participation of each Lender in the
relevant Loan) and will be expressed as a percentage rate per annum.
     3. The Additional Cost Rate for any Lender lending from a Facility Office
in a Participating Member State will be the percentage notified by that Lender
to the Administrative Agent. This percentage will be certified by that Lender in
its notice to the Administrative Agent to be its reasonable determination of the
cost (expressed as a percentage of that Lender’s participation in all Loans made
from that Facility Office) of complying with the minimum reserve requirements of
the European Central Bank in respect of loans made from that Facility Office.
     4. The Additional Cost Rate for any Lender lending from a Facility Office
in the United Kingdom will be calculated by the Administrative Agent as follows:
     (a) in relation to a Loan in GBP:

         
 
  AB + C(B - D) + E x 0.01   per cent. per annum
 
  100 - (A + C)  
 
       

     (b) in relation to a Loan in any currency other than GBP:

             
 
    E x 0.01     per cent. per annum
 
    300  
 
           

     Where:
     A is the percentage of Eligible Liabilities (assuming these to be in excess
of any stated minimum) which that Lender is from time to time required to
maintain as an interest free cash ratio deposit with the Bank of England to
comply with cash ratio requirements.
     B is the percentage rate of interest (excluding the Applicable Margin and
the Mandatory Cost and, if the Loan is an Unpaid Sum, the additional rate of
interest specified in Section 2.06(c)) payable for the relevant Interest Period
on the Loan.
 

 

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     C is the percentage (if any) of Eligible Liabilities which that Lender is
required from time to time to maintain as interest bearing Special Deposits with
the Bank of England.
     D is the percentage rate per annum payable by the Bank of England to the
Administrative Agent (or such other bank as may be designated by the
Administrative Agent in consultation with Borrower) on interest bearing Special
Deposits.
     E is designed to compensate Lenders for amounts payable under the Fees
Rules and is calculated by the Administrative Agent as being the average of the
most recent rates of charge supplied by the Reference Banks to the
Administrative Agent pursuant to paragraph 7 below and expressed in GBP per
£1 million.
     5. For the purposes of this Schedule:
     (a) “Eligible Liabilities” and “Special Deposits” have the meanings given
to them from time to time under or pursuant to the Bank of England Act 1998 or
(as may be appropriate) by the Bank of England;
     (b) “Facility Office” means the office or offices notified by a Lender to
the Administrative Agent in writing on or before the date it becomes a Lender
(or, following that date, by not less than five Business Days’ written notice)
as the office or offices through which it will perform its obligations under
this Agreement;
     (c) “Fees Rules” means the rules on periodic fees contained in the FSA
Supervision Manual or such other law or regulation as may be in force from time
to time in respect of the payment of fees for the acceptance of deposits;
     (d) “Fee Tariffs” means the fee tariffs specified in the Fees Rules under
the activity group A.1 Deposit acceptors (ignoring any minimum fee or zero rated
fee required pursuant to the Fees Rules but taking into account any applicable
discount rate);
     (e) “Reference Banks” means, in relation to each of the LIBOR Rate and
Mandatory Cost, the principal office in Stamford, Connecticut of UBS AG,
Stamford Branch, or such other bank or banks as may be designated by the
Administrative Agent in consultation with Borrower;
     (f) “Tariff Base” has the meaning given to it in, and will be calculated in
accordance with, the Fees Rules; and
     (g) “Unpaid Sum” means any sum due and payable but unpaid by any Loan Party
under the Loan Documents.
     6. In application of the above formulae, A, B, C and D will be included in
the formulae as percentages (i.e. 5 per cent. will be included in the formula as
5 and not as 0.05). A negative result obtained by subtracting D from B shall be
taken as zero. The resulting figures shall be rounded to four decimal places.
     7. If requested by the Administrative Agent, each Reference Bank shall, as
soon as practicable after publication by the Financial Services Authority,
supply to the Administrative
 

 

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Agent, the rate of charge payable by that Reference Bank to the Financial
Services Authority pursuant to the Fees Rules in respect of the relevant
financial year of the Financial Services Authority (calculated for this purpose
by that Reference Bank as being the average of the Fee Tariffs applicable to
that Reference Bank for that financial year) and expressed in GBP per £1 million
of the Tariff Base of that Reference Bank.
     8. Each Lender shall supply any information required by the Administrative
Agent for the purpose of calculating its Additional Cost Rate. In particular,
but without limitation, each Lender shall supply the following information on or
prior to the date on which it becomes a Lender:
     (a) the jurisdiction of its Facility Office; and
     (b) any other information that the Administrative Agent may reasonably
require for such purpose.
     Each Lender shall promptly notify the Administrative Agent of any change to
the information provided by it pursuant to this paragraph.
     9. The percentages of each Lender for the purpose of A and C above and the
rates of charge of each Reference Bank for the purpose of E above shall be
determined by the Administrative Agent based upon the information supplied to it
pursuant to paragraphs 7 and 8 above and on the assumption that, unless a Lender
notifies the Administrative Agent to the contrary, each Lender’s obligations in
relation to cash ratio deposits and Special Deposits are the same as those of a
typical bank from its jurisdiction of incorporation with a Facility Office in
the same jurisdiction as its Facility Office.
     10. The Administrative Agent shall have no liability to any person if such
determination results in an Additional Cost Rate which over or under compensates
any Lender and shall be entitled to assume that the information provided by any
Lender or Reference Bank pursuant to paragraphs 3, 7 and 8 above is true and
correct in all respects.
     11. The Administrative Agent shall distribute the additional amounts
received as a result of the Mandatory Cost to the Lenders on the basis of the
Additional Cost Rate for each Lender based on the information provided by each
Lender and each Reference Bank pursuant to paragraphs 3, 7 and 8 above.
     12. Any determination by the Administrative Agent pursuant to this Schedule
in relation to a formula, the Mandatory Cost, an Additional Cost Rate or any
amount payable to a Lender shall, in the absence of manifest error, be
conclusive and binding on all parties to this Agreement.
     13. The Administrative Agent may from time to time, after consultation with
Borrower and the Lenders, determine and notify to all parties to this Agreement
any amendments which are required to be made to this Annex III in order to
comply with any change in law, regulation or any requirements from time to time
imposed by the Bank of England, the Financial Services Authority or the European
Central Bank (or, in any case, any other authority which replaces all or any of
its functions) and any such determination shall, in the absence of manifest
error, be conclusive and binding on all parties to this Agreement.