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AGREEMENT 

Motors Liquidation Company Avoidance Action Trust 

$15,000,000 Litigation-Related Advance 

July 14, 2016 

The signatory parties hereto agree as follows with respect to a proposed advance of fifteen million dollars 

($15,000,000.00) (the “Litigation Cost Advance”) to be provided by the Motors Liquidation Company 

(“MLC”) debtor-in-possession lenders (the “DIP Lenders”) to the MLC Avoidance Action Trust (the 

“Trust”) on conditions described herein. This agreement (this “Agreement”) arises in connection with, 

and is conditioned upon approval by the United States Bankruptcy Court for the Southern District of New 

York (the “Bankruptcy Court”) of, the settlement of litigation between the DIP Lenders, on the one 

hand, and the MLC Official Committee of Unsecured Creditors (the “Committee”), on the other hand. 

Finalization and Bankruptcy Court approval of that settlement is a condition precedent to the DIP 

Lenders’ obligation to provide the contemplated Litigation Cost Advance, which is a contemplated term 

of that settlement. Capitalized terms used but not defined herein shall have the meanings ascribed to such 

terms in the Amended and Restated Motors Liquidation Company Avoidance Action Trust Agreement 

(the “Trust Agreement”). 

1. DIP Lenders: United States Department of the Treasury and Export Development Canada, in 

relative proportion 

2. AAT: Motors Liquidation Company Avoidance Action Trust 

3. Litigation Cost Advance Amount: $15,000,000 

4. Permitted Uses: Section 1.1(e) of the Trust Agreement shall be amended to include the 

Litigation Cost Advance proceeds as part of Avoidance Action Trust Administrative Cash and 

such funds may be used as provided in the Trust Agreement. 

5. Availability: The Litigation Cost Advance shall be made available on the Closing Date through 

a single funding to a segregated account in the name of the Trust (the “Funding Account”). The 

Funding Account shall be established at a bank reasonably acceptable to the Trust and the DIP 

Lenders. The Litigation Cost Advance is one term of a proposed litigation settlement between the 

DIP Lenders and the Committee (“Litigation Settlement”), and the DIP Lenders’ agreement to 

provide the Litigation Cost Advance shall be expressly conditioned upon, and shall not precede or 

arise in the absence of, approval by the Bankruptcy Court of such Litigation Settlement that 

includes the terms contained in this Agreement. 

6. Security: The Litigation Cost Advance shall be secured by a first priority lien over the Funding 

Account and the Avoidance Action Proceeds. The grant of such liens shall be included in the 

Bankruptcy Court order approving the Litigation Cost Advance. The Funding Account shall also 

be subject to a deposit account control agreement acceptable to the DIP Lenders and the AAT. 

7. Budgets: The DIP Lenders shall receive annual Budgets and quarterly updates in accordance 

with Section 6.3 of the Trust Agreement. The quarterly updates shall reconcile actual 

expenditures with projections that had been included in the relevant Budget, and, if and when the 

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Trust identifies a need for or the occurrence of actual expenditures that materially differ from the 

relevant Budget, they will notify the DIP Lenders as promptly as practicable, and no later than 15 

days after identifying the issue. 

8. Invoices: Section 8.3(b) of the Trust Agreement shall be amended to provide that Trust 

Professionals and any other persons entitled to payment from the Trust (other than the Trust 

Administrator and the Trust Monitor) shall be required to submit reasonably detailed invoices on 

a monthly basis to the Trust Administrator, the Trust Monitor and the DIP Lenders, including in 

such invoices a description of the work performed, the individuals who performed such work, and 

the hourly rate of such person, plus an itemized statement of expenses for which payment is 

sought. Invoices submitted to the DIP Lenders may be in a form reasonably necessary to protect 

the attorney-client privilege. For the avoidance of doubt, any and all payments by the Trust from 

funds that originated from the Litigation Cost Advance or that are contained in the Funding 

Account shall be subject to this invoice disclosure requirement. No payment on account of such 

invoices shall be made until 15 days after presentation of the invoices to the DIP Lenders. The 

Trust Administrator shall timely pay all such invoices that are not disputed by the Trust 

Administrator or the Trust Monitor. If either or both of the DIP Lenders have questions or 

concerns about any invoice submitted to the Trust, or about any other issue relating to the Trust’s 

finances or administration, they shall be entitled to discuss the matter with the Trust Monitor, as 

well as with the Trust Administrator and/or counsel for the Trust, as appropriate, and the Trust 

Monitor will consult with the DIP Lenders and give good faith consideration to any objection that 

the DIP Lenders raise before approval of payment by the Trust Administrator or non-objection by 

the Trust Monitor. The Trust Monitor, Trust Administrator, and/or counsel for the Trust, as 

appropriate, will engage in good faith discussions and attempt in good faith to provide 

information reasonably requested by either or both DIP Lenders. 

9. Funding Account Records; Reporting: The bank administering the Funding Account shall be 

required to provide the DIP Lenders with account statements for the Funding Account, and shall 

be required to provide immediate access to any or all Funding Account records upon request by 

either or both of the DIP Lenders. Additionally, the Trust shall provide periodic and timely 

reporting to the DIP Lenders, on terms to be agreed upon, regarding the prosecution of the Term 

Loan Avoidance Litigation. 

10. Draws: Prior to the Maturity Date (as defined below), and subject to the requirements of 

paragraph 8 hereof, the Trust shall be entitled to make withdrawals from the Funding Account at 

any time and in any amount determined by the Trust Administrator to be reasonable and 

appropriate to meet the needs of the Trust and not inconsistent with the terms and requirements of 

the Trust Agreement as amended hereby. Amounts not drawn shall remain in the Funding 

Account. Any amounts not withdrawn by the Maturity Date shall be returned to the DIP Lenders. 

11. Repayment: As stated above, Section 1.1(e) of the Trust Agreement shall be amended to include 

the Litigation Cost Advance in the defined term “Avoidance Action Trust Administrative Cash,” 

which will carry through to the definition of “DIP Lender Advances.” An amount equal to the 

Litigation Cost Advance less any amounts returned to the DIP Lenders pursuant to paragraph 10 

of this Agreement plus any other DIP Lender Advances, shall be repaid to the DIP Lenders first 

out of any Distributable Trust Assets in accordance with Section 5.1(d) of the Trust Agreement. 

12. No Additional Indebtedness or Liens: Except as provided in this paragraph 12, the Trust may 

not incur additional indebtedness, whether unsecured or secured by any interest (including a 

security interest) in the Term Loan Avoidance Action or Avoidance Action Proceeds without the 

prior written consent of the DIP Lenders, except that the Trust may incur expenses in the ordinary 

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course of the Trust’s business provided no lien or right of setoff is attached thereto. In the event 

that the Trust seeks other litigation funding, (a) the DIP Lenders shall be provided a right of first 

refusal to provide such funding, which right of first refusal must be exercised within thirty (30) 

days after being presented in writing the opportunity to provide such funding, and (b) such 

funding shall be junior and subordinate to the Litigation Cost Advance and to the amounts owed 

to the DIP Lenders on account of prior funding of the Trust, subject to a form of subordination 

that is acceptable to the DIP Lenders in all respects, such consent not to be unreasonably 

withheld. 

13. Closing Date: The earliest date on which all conditions, including Bankruptcy Court approval of 

a settlement agreement that includes as a term the DIP Lenders’ provision of the Litigation Cost 

Advance, are met. 

14. Maturity Date: The third anniversary of the Closing Date. The Maturity Date may be extended 

for three (3) additional one-year periods thereafter, each with the prior written consent of the DIP 

Lenders. 

15. Documentation: Documentation shall include, without limitation, (i) amendments to certain 

sections of the Trust Agreement and a motion of the Trust Administrator to approve such 

amendments; (ii) a motion to approve (A) the settlement between the DIP Lenders and the 

Committee over the allocation of the Avoidance Action Proceeds, and (B) the additional funding 

provided by the DIP Lenders to the Trust in the form of the Litigation Cost Advance on the terms 

herein; and (iii) deposit account control agreement for the Funding Account to be established 

pursuant to the terms herein. 

16. Governing Law: The Litigation Cost Advance and all agreements related to it shall be governed 

by the laws of the United States, and, to the extent the laws of any state apply, the State of New 

York (without regard to choice of law rules thereof).

17. Jurisdiction: Any disputes with respect to the Litigation Cost Advance, the parties submit to the 

exclusive jurisdiction of the Bankruptcy Court, and any appellate court thereto. 

18. Termination: The Trust is currently seeking Bankruptcy Court approval of a proposed 

alternative financing (the “Proposed Financing”) and the Trust will continue to seek such 

approval unless the following has occurred on or before July 18, 2016: either (i) a submission to 

the Bankruptcy Court of a motion seeking the approval of any agreement or arrangement, 

including, without limitation, the approval of any stipulation, with one or more DIP Lenders to 

provide funding for the Trust’s prosecution of the Term Loan Avoidance Action and any other 

action brought by the Trust; or (ii) an agreement or arrangement between the Trust and one or 

more DIP Lenders pursuant to which such DIP Lenders will provide funding for the Trust’s 

prosecution of the Term Loan Avoidance Action and any other action brought by the Trust. In 

the event of Bankruptcy Court approval of the Proposed Financing, this Agreement shall 

terminate and, in such event, the parties hereto shall have no further obligations or liabilities to 

each other under this Agreement. 

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