Exhibit
10.1(bg)


 


Sauer-Danfoss Inc.


Loan Agreement


(US $ 50,000,000.00)


 


Loan Agreement (the “Agreement”),
dated as of 9th December ,
2008, between Danfoss A/S, a Danish corporation (“Lender”) and Sauer-Danfoss
Inc., a Delaware corporation (“Borrower”).


 


Whereas, Borrower is an affiliate of Lender; and


 


Whereas, Borrower desires to borrow and Lender is
willing to lend US $ 50,000,000.00.


 


Therefore, it is agreed as follows:


 


1.            Loan. Upon and subject to the terms and conditions set forth in this
Agreement, Lender agrees to lend and Borrower agrees to borrow US $
50,000,000.00 as a bullet loan evidenced by the attached Promissory Note (the “Loan”).


 


2.            Interest Rate; Interest Calculation. (a) Except as provided in 2(b) below,
the interest rate is 4,02% per annum “Interest Rate” which is the aggregate of
Libor plus a margin of 1,70% p.a. plus swap cost if swapping from floating to
fixed rate. Interest shall be calculated on the actual number of days elapsed
on a 360 days year basis.


 


If on any date Libor does not reflect the Lender’s cost of funds, the
Lender shall notify the Borrower. Subsequent to such notice, the applicable
reference rate for any draw downs under this agreement shall then be based on
the greater of the Lender’s cost of funds and Libor..


 


(b)          From and after an event of default under this Agreement as described in
paragraph 5 below, the Borrower shall pay to the Lender interest on such amount
from the due date until payment is received by the Lender at a rate of 1% p.a.
above the Interest Rate.


 


(c)          In consideration of the Loan, on the initial funding date of the Loan
Borrower shall pay Lender a facility fee equal to 0.10% of the principal amount
of the Loan.


 


3.            Term; Payment Dates; Prepayments. (a) The principal together with all
unpaid accrued interest shall be repaid in full at the 9th December,
2011.


 


(b)          Interest on the outstanding principle amount of the Loan shall be
payable on the last day of each calendar quarter or if any such date is not a
business day, then the next succeeding business day (each an “Interest Payment
Date”).


 


(c)          The outstanding principal amount of the Loan may be prepaid in whole or
in part without premium or penalty on any Interest Payment Date; provided that
any partial prepayments of the principal amount shall be in minimum amounts of
US $ 5,000,000.00 and in integral multiples of US $ 1,000,000.00. Upon
termination of the Agreement as provided for in paragraph 5 below, the entire
principal amount of the Loan outstanding together with any accrued but


 

















 


unpaid
interest shall be paid by Borrower to Lender. Any cost for the lender by
unwinding the funding shall be reimbursed by the borrower.


 


4.            Payment. Payments of interest and principal shall be
made by wire transfer on each Interest Payment Date and on the final maturity
date, such dates being banking days in New York and Copenhagen, to account of
Lender, Account no. / Iban no. DK7430004454008669 at Danske Bank, Copenhagen,
Denmark (swift: DABADKKK), or as otherwise designated by written notification
by Lender.


 


5.            Events
of Default; Termination. (a) Each
of the following shall be an event of default under this Agreement:


 


(i)           failure by Borrower to repay the entire principal amount, or such
lesser principal amount as Lender shall demand, within five (5) business
days of the date when such payment is due hereunder; or


 


(ii)          failure by Borrower to pay interest on the outstanding principle amount
of the Loan within five (5) business days of the date when such payment is
due hereunder; or


 


(ii)          failure by Borrower to perform any other material obligation of
Borrower to Lender hereunder; or


 


(iv)         Borrower shall execute an assignment for the benefits of its creditors
or resort to laws protecting insolvent companies.


 


(b)          In the event that Lender must employ attorneys or file suit to collect
hereunder, Borrower agrees to pay the reasonable attorney fees and all court
costs incurred by Lender.


 


6.            Assignment/Subrogation. Borrower shall not transfer or assign any
or all of its rights and obligations hereunder without the prior written
consent of Lender. Lender may, at any time, assign this Agreement and the
Promissory Note and its rights or obligations hereunder and thereunder in which
case the assignee shall be subrogated to the rights of Lender.


 


7.            Copies. This Agreement is made up in two (2) identical
copies of which one copy is for Lender and the other for Borrower.


 


8.            Notices. In the event that any written notice need
be given under this Agreement, it shall be given (a) by nationally
recognized over night carrier at the address of Borrower or Lender, as the case
may be, set forth below, or (b) by facsimile or e-mail as follows:


 


(i)                                        To Borrower:                         250 Parkway Drive, Suite 270


Lincolnshire, Illinois 60069 USA


Attention: Treasurer


facsimile -
+847-876-1799


e-mail - ccohrs@sauer-danfoss.com


 

















 


(ii)                                    To Lender:                                     Danfoss A/S


Nordborgvej 81


DK-6430 Nordborg


Denmark


Attention: Ole Albertsen


E-mail: Albertsen@danfoss.com


 


9.           Authority. Each Party represents that (a) it has
the legal capacity, corporate or otherwise, to enter into this Agreement and/or
the Promissory Note, as the case may be and (b) the execution and delivery
of this Agreement and the Promissory Note are not in violation of (i) applicable
laws, (ii) its certificate of incorporation, by-laws or other such
documentation or (iii) any other agreement by which it or its property is
bound.


 


10.         Applicable
Law. This Agreement shall be
governed by the laws of Denmark.


 


Agreed upon as of the day first above
written.


 


	
  Danfoss
  A/S

  	
   

  	
  Sauer-Danfoss
  Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Felmming A. Jorgensen

  	
   

  	
  By:

  	
  /s/
  Karl Schmidt

  
	
  Name:

  	
   

  	
  Name:
  Karl Schmidt

  
	
  Title:

  	
  Group
  Treasurer

  	
   

  	
  Title

  	
  EVP
  & CFO

  
							



 

















 


Promissory
Note


Sauer-Danfoss Inc.


 


[9th December 2008]


 


US $ 50,000,000.00


 


Sauer-Danfoss Inc. (“Borrower”),
for value received, hereby promises to pay to the order of Danfoss A/S (“Lender”)
in lawful money of the United States of America (in freely transferable U.S.
Dollars and in same day funds), in accordance with the method of payment
specified in that certain Loan Agreement dated as of 9th December 2008, between
Lender and Borrower (the “Agreement”), the principal sum of US $ 50,000,000.00,
which amount shall be payable at such times as provided for in the Agreement.


 


Borrower promises also to
pay interest on the unpaid principal amount hereof in like money and in like
manner at the rate or rates which shall be determined in accordance with the
provisions of the Agreement, interest to be payable at the times provided for
in the Agreement. This Note is the Promissory Note referred to in the Agreement
and is entitled to the benefits thereof and any security contemplated thereby.
This Note evidences a loan made by Lender, during such time as such loan is
being maintained. This Note is subject to repayment as specified in the
Agreement. In case Borrower defaults on the loan, the principal and accrued
interest on this Note may be declared to be due and payable in the manner and
with the effect provided in the Agreement. Lender may assign this Note in
accordance with the provisions of the Agreement.


 


Borrower hereby waives
presentment, demand, protest or notice of any kind in connection with this
Note.


 


This Note shall be governed
and construed and interpreted in accordance with the laws of Denmark.


 


Sauer-Danfoss Inc.


 


 


	
  By:

  	
  /s/
  Karl Schmidt

  	
   

  
	
  Name:

  	
  /s/
  Karl Schmidt

  	
   

  
	
  Title:

  	
  EVP & CFO

  	
   

  



 

















 


CERTIFICATE OF SECRETARY


OF


SAUER-DANFOSS INC.


 


This Certificate is being
delivered pursuant to that certain Loan Agreement entered into as of 9 December 2008
(the “Agreement”) between Sauer-Danfoss Inc., a Delaware corporation (the “Corporation”),
as borrower, and Danfoss A/S, as lender.


 


The undersigned hereby certifies that:


 


1.             Attached
hereto as Exhibit A is a true and complete copy of a resolution duly
adopted by the Board of Directors of the Corporation and such resolution has
been entered in the minute book of the Corporation, has not been amended,
altered or repealed, and remains in full force and effect on the date hereof.


 


2.             Set
forth below is the name, title and signature of one or more officers of the
Corporation each of whom, acting independently, is authorized to execute the
Agreement and all other documents contemplated thereby, including any related
promissory note, and the certificates or instruments furnished pursuant
thereto.


 


	
  Karl
  J. Schmidt

  	
  Chief
  Financial Officer

  	
  /s/
  Karl J. Schmidt

  



 


IN WITNESS WHEREOF, I have hereunto set my hand this
10 day of December 2008.


 


	
   

  	
  SAUER-DANFOSS
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Kenneth D. McCuskey

  
	
   

  	
  Kenneth
  D. McCuskey

  Secretary