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Exhibit 10.36    
    

 
  THERAVANCE, INC.
  2008 NEW EMPLOYEE EQUITY INCENTIVE PLAN    
    
    NOTICE OF STOCK OPTION GRANT

        You have been granted the following option to purchase shares of the Common Stock of Theravance, Inc. (the "Company"): 

	 	Name of Optionee:	 	«Name»
	

 	

ID Number:	
 	

«ID»
	

 	

Total Number of Shares Granted:	
 	

«Shares»
	

 	

Type of Option:	
 	

Nonstatutory Stock Option
	

 	

Grant Number:	
 	

«Number»
	

 	

Exercise Price Per Share:	
 	

$«Price»
	

 	

Date of Grant:	
 	

«DateGrant»
	

 	

Vesting Commencement Date:	
 	

«VestDay»
	

 	

Vesting Schedule:	
 	

This option becomes exercisable with respect to the first 25% of the Shares subject to this option when you complete 12 months of continuous Service from the Vesting Commencement Date and with respect to an additional 2.0833% of the Shares
subject to this option when you complete each month of continuous Service thereafter.
	

 	

Expiration Date:	
 	

«ExpDate». This option expires earlier if your Service terminates earlier, as described in the Stock Option Agreement.

        You
and the Company agree that this option is granted under and governed by the terms and conditions of the Stock Option Agreement, which is attached to and made a part of this document,
and the Company's 2008 New Employee Equity Incentive Plan (the "Plan"). 

        You
further agree that the Company may deliver by email all documents relating to the Plan or this option (including, without limitation, prospectuses required by the Securities and
Exchange Commission) and all other documents that the Company is required to deliver to its security holders (including, without limitation, annual reports and proxy statements). You also agree that
the Company may deliver these documents by posting them on a web site maintained by the Company or by a third party under contract with the Company. If the Company posts these documents on a web site,
it will notify you by email. 

 
 

THERAVANCE, INC.
  2008 NEW EMPLOYEE EQUITY INCENTIVE PLAN    
    
    STOCK OPTION AGREEMENT    
    

	Grant of Option	 	You have been granted an option as of the Grant Date to purchase up to the number of Shares of Company Common Stock specified in the Notice of Stock Option Grant.
	
Tax Treatment	
 	

This option is a nonstatutory stock option.
	
Vesting	
 	

This option becomes exercisable in installments, as shown in the Notice of Stock Option Grant.
	

 	
 	

This option shall become exercisable in full if not assumed or a new option substituted pursuant to Section 11.3 of the Plan. In addition, this option becomes exercisable in full if the Company is subject to a "Change in
Control" (as defined in the Plan) before your Service (as defined in the Plan) terminates, and you are subject to an Involuntary Termination (as defined below) within three months prior or 24 months after the Change in
Control.
	

 	
 	

For purposes of this Agreement, "Cause" shall mean (i) the unauthorized use or disclosure of the confidential information or trade secrets of the Company, which use causes material harm to the
Company, (ii) conviction of a felony under the laws of the United States or any state thereof, (iii) gross negligence or (iv) repeated failure to perform lawful assigned duties for thirty days after receiving written notification from
the Board of Directors.
	

 	
 	

For purposes of this Agreement, "Involuntary Termination" means the termination of your Service by reason of:
	

 	
 	

(a)	
 	

an involuntary dismissal or discharge by the Company for reasons other than for Cause; or
	

 	
 	

(b)	
 	

your voluntary resignation following (i) a change in your position with the Company (or Parent or Subsidiary employing you) which materially reduces your level of responsibility, (ii) a reduction in your level of compensation (including
base salary, fringe benefits and participation in corporate-performance based bonus or incentive programs) or (iii) a relocation of your workplace more than fifty miles away from the workplace designated by the Company on your initial date of
service, provided and only if such change, reduction or relocation is effected by the Company without your consent.
	

 	
 	

No additional shares will vest after your Service has terminated for any reason, except to the extent set forth above if you are subject to an Involuntary Termination within three months prior to a Change in Control.

 

	
Term	
 	

This option expires in any event at the close of business at Company headquarters on the day before the 10th anniversary of the Date of Grant, as shown in the Notice of Stock Option Grant. (It will expire earlier if your Service
terminates, as described below.) You may exercise this option at any time before its expiration under the preceding sentence, but only to the extent that this option had become exercisable before your Service terminated.
	
Regular Termination	
 	

If your Service terminates for any reason except death or total and permanent disability, then this option will expire at the close of business at Company headquarters on the date three months after your termination date. The Company determines when
your Service terminates for this purpose.
	
Death	
 	

If you die before your Service terminates, then this option will expire at the close of business at Company headquarters on the date that is 12 months after the date of death.
	
Disability	
 	

If your Service terminates because of your total and permanent disability, then this option will expire at the close of business at Company headquarters on the date 12 months after your termination date.
	

 	
 	

For all purposes under this Agreement, "total and permanent disability" means that you are unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in
death or which has lasted, or can be expected to last, for a continuous period of not less than one year.
	
Leaves of Absence and Part-Time Work	
 	

For purposes of this option, your Service does not terminate when you go on a military leave, a sick leave or another bona fide leave of absence, if the leave was approved by the Company in writing. But
your Service terminates when the approved leave ends, unless you immediately return to active work.
	

 	
 	

If you go on a leave of absence, then the vesting schedule specified in the Notice of Stock Option Grant may be adjusted in accordance with the Company's leave of absence policy or the terms of your leave. If you commence working on a part-time basis,
 then the vesting schedule specified in the Notice of Stock Option Grant may be adjusted in accordance with the Company's part-time work policy or the terms of an agreement between you and the Company pertaining to your part-time
schedule.
	
Restrictions on Exercise	
 	

The Company will not permit you to exercise this option if the issuance of shares at that time would violate any law or regulation.

2

 

	
Notice of Exercise	
 	

When you wish to exercise this option, you must notify the Company by filing the proper "Notice of Exercise" form at the address given on the form. Your notice must specify how many shares you wish to purchase. Your notice must also specify how your
shares should be registered. The notice will be effective when the Company receives it.
	

 	
 	

If someone else wants to exercise this option after your death, that person must prove to the Company's satisfaction that he or she is entitled to do so.
	
Form of Payment	
 	

When you submit your notice of exercise, you must include payment of the option exercise price for the shares that you are purchasing. To the extent permitted by applicable law, payment may be made in one (or a combination of two or more) of the
following forms:
	

 	
 	

•	
 	

Your personal check, a cashier's check or a money order.
	

 	
 	

•	
 	

Certificates for shares of Company stock that you own, along with any forms needed to effect a transfer of those shares to the Company. The value of the shares, determined as of the effective date of the option exercise, will be applied to the option
exercise price. Instead of surrendering shares of Company stock, you may attest to the ownership of those shares on a form provided by the Company and have the same number of shares subtracted from the option shares issued to you. However, you may
not surrender, or attest to the ownership of, shares of Company stock in payment of the exercise price if your action would cause the Company to recognize additional compensation expense with respect to this option for financial reporting
purposes.
	

 	
 	

•	
 	

Irrevocable directions to a securities broker approved by the Company to sell all or part of your option shares and to deliver to the Company from the sale proceeds an amount sufficient to pay the option exercise price and any withholding taxes. (The
balance of the sale proceeds, if any, will be delivered to you.) The directions must be given by signing a special "Notice of Exercise" form provided by the Company.
	

 	
 	

•	
 	

Irrevocable directions to a securities broker or lender approved by the Company to pledge option shares as security for a loan and to deliver to the Company from the loan proceeds an amount sufficient to pay the option exercise price and any
withholding taxes. The directions must be given by signing a special "Notice of Exercise" form provided by the Company.

3

 

	
Withholding Taxes and Stock Withholding	
 	

You will not be allowed to exercise this option unless you make arrangements acceptable to the Company to pay any withholding taxes that may be due as a result of the option exercise. With the Company's consent, these arrangements may include
withholding shares of Company stock that otherwise would be issued to you when you exercise this option. The value of these shares, determined as of the effective date of the option exercise, will be applied to the withholding taxes.
	
Restrictions on Resale	
 	

You agree not to sell any option shares at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale. This restriction will apply as long as your Service continues and for such period of
time after the termination of your Service as the Company may specify.
	
Transfer of Option	
 	

Prior to your death, only you may exercise this option. You cannot transfer or assign this option. For instance, you may not sell this option or use it as security for a loan. If you attempt to do any of these things, this option will immediately
become invalid. You may, however, dispose of this option in your will or a beneficiary designation.
	

 	
 	

Regardless of any marital property settlement agreement, the Company is not obligated to honor a notice of exercise from your former spouse, nor is the Company obligated to recognize your former spouse's interest in your option in any other
way.
	
Retention Rights	
 	

Your option or this Agreement does not give you the right to be retained by the Company or a subsidiary of the Company in any capacity. The Company and its subsidiaries reserve the right to terminate your Service at any time, with or without
cause.
	
Stockholder Rights	
 	

You, or your estate or heirs, have no rights as a stockholder of the Company until you have exercised this option by giving the required notice to the Company and paying the exercise price. No adjustments are made for dividends or other rights if the
applicable record date occurs before you exercise this option, except as described in the Plan.
	
Adjustments	
 	

In the event of a stock split, a stock dividend or a similar change in Common Stock, the number of shares covered by this option and the exercise price per share shall be adjusted as provided in the Plan.
	
Applicable Law	
 	

This Agreement will be interpreted and enforced under the laws of the State of Delaware (without regard to their choice-of-law provisions).

4

 

	
The Plan and Other Agreements	
 	

The text of the Plan is incorporated in this Agreement by reference. A copy of the Plan is available on the Company's intranet or by request to the Company's Finance Department.
	

 	
 	

This Agreement and the Plan constitute the entire understanding between you and the Company regarding this option. Any prior agreements, commitments or negotiations concerning this option are superseded. This Agreement may be amended only by another
written agreement between the parties.

BY ACCEPTING THIS STOCK OPTION GRANT, YOU AGREE TO ALL OF THE TERMS AND

CONDITIONS DESCRIBED ABOVE AND IN THE PLAN.

5

QuickLinks

Exhibit 10.36

THERAVANCE, INC. 2008 NEW EMPLOYEE EQUITY INCENTIVE PLAN NOTICE OF STOCK OPTION GRANT

THERAVANCE, INC. 2008 NEW EMPLOYEE EQUITY INCENTIVE PLAN STOCK OPTION AGREEMENTExhibit 4.1

 

EXECUTION COPY

 

 

CONTRIBUTION
AGREEMENT

 

 

Among

 

CG
INVESTOR, LLC,

 

DAIMLERCHRYSLER
NORTH AMERICA FINANCE CORPORATION,

 

DAIMLERCHRYSLER
HOLDING CORPORATION

 

and

 

DAIMLERCHRYSLER
AG

 

(with
respect to Section 5.03 (Confidentiality) and Section 11.10
(Guarantee))

 

Dated
as of May 14, 2007

 

 

TABLE
OF CONTENTS

 

	
   

  	
  Page

  
	
  ARTICLE I DEFINITIONS

  	
  1

  
	
   

  	
   

  
	
  SECTION 1.01. Certain Defined Terms

  	
  1

  
	
  SECTION 1.02. Definitions

  	
  19

  
	
  SECTION 1.03. Interpretation and Rules of Construction

  	
  25

  
	
   

  	
   

  
	
  ARTICLE II CONTRIBUTIONS

  	
  26

  
	
   

  	
   

  
	
  SECTION 2.01. Contributions to the Company

  	
  26

  
	
  SECTION 2.02. Distributions

  	
  26

  
	
  SECTION 2.03. Closing

  	
  26

  
	
  SECTION 2.04. Closing Deliveries by the DC Contributors

  	
  28

  
	
  SECTION 2.05. Closing Deliveries by the Investor

  	
  29

  
	
  SECTION 2.06. Delayed Closing

  	
  29

  
	
  SECTION 2.07. Adjustment

  	
  31

  
	
   

  	
   

  
	
  ARTICLE
  III REPRESENTATIONS AND WARRANTIES OF THE DC CONTRIBUTORS

  	
  31

  
	
  SECTION 3.01. Organization, Authority and Qualification of the
  DC Contributors

  	
  31

  
	
  SECTION 3.02. Organization, Authority and Qualification

  	
  32

  
	
  SECTION 3.03. Ownership of Company Equity Interests;
  Subsidiaries

  	
  33

  
	
  SECTION 3.04. No Conflict

  	
  34

  
	
  SECTION 3.05. Governmental Consents and Approvals

  	
  34

  
	
  SECTION 3.06. Financial Statements; SEC Documents; Internal
  Controls

  	
  34

  
	
  SECTION 3.07. Absence of Undisclosed Material Liabilities

  	
  37

  
	
  SECTION 3.08. Conduct in the Ordinary Course

  	
  38

  
	
  SECTION 3.09. Litigation

  	
  38

  
	
  SECTION 3.10. Compliance with Laws

  	
  38

  
	
  SECTION 3.11. Environmental Matters

  	
  38

  
	
  SECTION 3.12. Company Intellectual Property and IT Systems

  	
  40

  
	
  SECTION 3.13. Real Property

  	
  41

  
	
  SECTION 3.14. Employee Matters

  	
  43

  
	
  SECTION 3.15. Labor Matters

  	
  45

  
	
  SECTION 3.16. Taxes

  	
  45

  
	
  SECTION 3.17. Material Contracts

  	
  46

  
	
  SECTION 3.18. Company Products

  	
  49

  
	
  SECTION 3.19. Securitizations

  	
  50

  
	
  SECTION 3.20. Derivative Transactions

  	
  51

  
	
  SECTION 3.21. Investment Securities

  	
  51

  
	
  SECTION 3.22. Sufficiency of Assets

  	
  51

  
	
  SECTION 3.23. FinCo/DCC/Guarantor Transition Services

  	
  52

  
	
  SECTION 3.24. Certain Business Practices

  	
  52

  

 

i

 

	
  SECTION 3.25. Insurance

  	
  52

  
	
  SECTION 3.26. Insurance Regulation

  	
  53

  
	
  SECTION 3.27. Cash/Debt Indemnification Amount

  	
  54

  
	
  SECTION 3.28. Brokers

  	
  54

  
	
  SECTION 3.29. Disclaimer of the DC Contributors

  	
  54

  
	
   

  	
   

  
	
  ARTICLE IV REPRESENTATIONS AND
  WARRANTIES OF THE INVESTOR

  	
  55

  
	
   

  	
   

  
	
  SECTION 4.01. Organization and Authority of the Investor

  	
  55

  
	
  SECTION 4.02. No Conflict

  	
  56

  
	
  SECTION 4.03. Governmental Consents and Approvals

  	
  56

  
	
  SECTION 4.04. Litigation

  	
  56

  
	
  SECTION 4.05. Financing

  	
  56

  
	
  SECTION 4.06. Investment Purpose

  	
  58

  
	
  SECTION 4.07. Dispositions

  	
  58

  
	
  SECTION 4.08. Brokers

  	
  58

  
	
   

  	
   

  
	
  ARTICLE V ADDITIONAL AGREEMENTS

  	
  58

  
	
   

  	
   

  
	
  SECTION 5.01. Conduct of Business of the Company Prior to the
  Closing

  	
  58

  
	
  SECTION 5.02. Access to Company Information

  	
  63

  
	
  SECTION 5.03. Confidentiality

  	
  66

  
	
  SECTION 5.04. Regulatory and Other Authorizations; Notices and
  Consents

  	
  67

  
	
  SECTION 5.05. Restructuring Transactions

  	
  68

  
	
  SECTION 5.06. Intellectual Property Agreements

  	
  69

  
	
  SECTION 5.07. Notifications

  	
  69

  
	
  SECTION 5.08. Credit Support Instruments

  	
  69

  
	
  SECTION 5.09. Termination of Affiliate Contracts

  	
  70

  
	
  SECTION 5.10. Financing Assistance

  	
  70

  
	
  SECTION 5.11. Further Action

  	
  71

  
	
  SECTION 5.12. Contingent Value Right

  	
  72

  
	
  SECTION 5.13. Omitted Assets and Services

  	
  73

  
	
  SECTION 5.14. Leased Portfolio and Like-Kind Exchange Program

  	
  74

  
	
  SECTION 5.15. Treatment of DCC Debt

  	
  74

  
	
  SECTION 5.16. Certain Pre-Closing Actions

  	
  76

  
	
  SECTION 5.17. FinCo Books and Records

  	
  77

  
	
  SECTION 5.18. Compliance Remediation

  	
  78

  
	
  SECTION 5.19. Funded Indebtedness

  	
  78

  
	
   

  	
   

  
	
  ARTICLE VI EMPLOYEE MATTERS

  	
  79

  
	
   

  	
   

  
	
  SECTION 6.01. Continued Employment

  	
  79

  
	
  SECTION 6.02. Agreements Covering Employees

  	
  79

  
	
  SECTION 6.03. Service Credit

  	
  79

  
	
  SECTION 6.04. Assumption of Retention Agreements

  	
  79

  
	
  SECTION 6.05. Assumption of Liabilities

  	
  80

  
	
  SECTION 6.06. Labor Negotiations

  	
  80

  

 

ii

 

	
  SECTION 6.07. Equity-Based Compensation

  	
  80

  
	
   

  	
   

  
	
  ARTICLE VII TAX MATTERS

  	
  82

  
	
   

  	
   

  
	
  SECTION 7.01. Tax Indemnities

  	
  82

  
	
  SECTION 7.02. Tax Refunds and Tax Benefits

  	
  83

  
	
  SECTION 7.03. Contests

  	
  84

  
	
  SECTION 7.04. Preparation of Tax Returns

  	
  86

  
	
  SECTION 7.05. Tax Cooperation and Exchange of Information

  	
  86

  
	
  SECTION 7.06. Conveyance Taxes

  	
  87

  
	
  SECTION 7.07. Tax Covenants

  	
  87

  
	
  SECTION 7.08. Tax Matters Partner; Allocations

  	
  88

  
	
  SECTION 7.09. Miscellaneous

  	
  88

  
	
   

  	
   

  
	
  ARTICLE VIII CONDITIONS TO CLOSING

  	
  89

  
	
   

  	
   

  
	
  SECTION 8.01. Conditions to Obligations of the DC Contributors

  	
  89

  
	
  SECTION 8.02. Conditions to Obligations of the Investor

  	
  90

  
	
   

  	
   

  
	
  ARTICLE IX INDEMNIFICATION

  	
  92

  
	
   

  	
   

  
	
  SECTION 9.01. Survival of Representations and Warranties

  	
  92

  
	
  SECTION 9.02. Indemnification by the DC Contributors

  	
  92

  
	
  SECTION 9.03. Indemnification by the Investor

  	
  94

  
	
  SECTION 9.04. Limits on Indemnification

  	
  94

  
	
  SECTION 9.05. Notice of Loss; Third Party Claims

  	
  96

  
	
  SECTION 9.06. Remedies

  	
  96

  
	
  SECTION 9.07. Tax Matters

  	
  97

  
	
   

  	
   

  
	
  ARTICLE X TERMINATION; EFFECT OF
  TERMINATION

  	
  97

  
	
   

  	
   

  
	
  SECTION 10.01. Termination

  	
  97

  
	
  SECTION 10.02. Effect of Termination

  	
  98

  
	
   

  	
   

  
	
  ARTICLE XI GENERAL PROVISIONS

  	
  99

  
	
   

  	
   

  
	
  SECTION 11.01. Expenses

  	
  99

  
	
  SECTION 11.02. Notices

  	
  99

  
	
  SECTION 11.03. Public Announcements

  	
  100

  
	
  SECTION 11.04. Severability

  	
  100

  
	
  SECTION 11.05. Entire Agreement

  	
  100

  
	
  SECTION 11.06. Assignment

  	
  101

  
	
  SECTION 11.07. Amendment

  	
  101

  
	
  SECTION 11.08. Waiver

  	
  101

  
	
  SECTION 11.09. No Third Party Beneficiaries

  	
  101

  
	
  SECTION 11.10. Guarantee

  	
  101

  
	
  SECTION 11.11. Currency

  	
  103

  
	
  SECTION 11.12. Governing Law

  	
  103

  

 

iii

 

	
  SECTION 11.13. Consent to Jurisdiction

  	
  103

  
	
  SECTION 11.14. Counterparts

  	
  104

  
	
  SECTION 11.15. Certain Company-Related Actions

  	
  104

  
	
  SECTION 11.16. Additional Diligence

  	
  104

  

 

iv

 

EXHIBITS

 

	
  A

  	
   

  	
  CAFE Credits Sharing
  Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  B

  	
   

  	
  Cooperation Agreement for
  Project “Adaptation Work for Diesel Engines/Control Systems” Term Sheet

  
	
   

  	
   

  	
   

  
	
  C

  	
   

  	
  Cooperation Agreement for
  Project “Common Axle” Term Sheet

  
	
   

  	
   

  	
   

  
	
  D

  	
   

  	
  Cooperation Agreement for
  Project “Common Unibody SUV” Term Sheet

  
	
   

  	
   

  	
   

  
	
  E

  	
   

  	
  Cooperation Agreement for
  Project “Common V6” Term Sheet

  
	
   

  	
   

  	
   

  
	
  F

  	
   

  	
  Cooperation Agreement for
  Project “Fuel Cell Vehicle” Term Sheet

  
	
   

  	
   

  	
   

  
	
  G

  	
   

  	
  DCC/Guarantor Transition
  Services Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  H

  	
   

  	
  FinCo/DCFS USA Transition
  Services Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  I

  	
   

  	
  FinCo/Guarantor Transition
  Services Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  J

  	
   

  	
  Fuel Cell R&D
  Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  K

  	
   

  	
  Future Business Model in
  China and South Korea Term Sheet

  
	
   

  	
   

  	
   

  
	
  L

  	
   

  	
  International Distribution
  Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  M

  	
   

  	
  International Financial
  Services Cooperation Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  N

  	
   

  	
  ITM Cooperation Agreement
  Term Sheet

  
	
   

  	
   

  	
   

  
	
  O

  	
   

  	
  LLC Operating Agreement
  Term Sheet

  
	
   

  	
   

  	
   

  
	
  P

  	
   

  	
  Master ER&D Agreement
  Term Sheet

  
	
   

  	
   

  	
   

  
	
  Q

  	
   

  	
  Parts Distribution Centers
  Term Sheet

  
	
   

  	
   

  	
   

  
	
  R

  	
   

  	
  Procurement and Supply
  Cooperation Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  S

  	
   

  	
  Sprinter Distribution
  Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  T

  	
   

  	
  Subordinated Note Term
  Sheet

  
	
   

  	
   

  	
   

  
	
  U

  	
   

  	
  Form of Technology
  Sharing Agreement

  
	
   

  	
   

  	
   

  
	
  V

  	
   

  	
  Form of Trademark
  Agreement

  
	
   

  	
   

  	
   

  
	
  W

  	
   

  	
  ZEV Credits Sharing
  Agreement Term Sheet

  
	
   

  	
   

  	
   

  
	
  X

  	
   

  	
  Leased Assets Residual
  Cash Flow Term Sheet

  

 

v

 

SCHEDULES

 

	
  1.01(a)

  	
   

  	
  Accounting Principles

  
	
   

  	
   

  	
   

  
	
  1.01(b)

  	
   

  	
  Company Subsidiaries

  
	
   

  	
   

  	
   

  
	
  1.01(c)

  	
   

  	
  Intercompany Receivable

  
	
   

  	
   

  	
   

  
	
  1.01(d)

  	
   

  	
  Calculation of Entity Cash
  Amount

  
	
   

  	
   

  	
   

  
	
  1.01(e)

  	
   

  	
  Calculation of Entity Debt
  Amount

  
	
   

  	
   

  	
   

  
	
  1.01(f)

  	
   

  	
  Investor’s Knowledge

  
	
   

  	
   

  	
   

  
	
  1.01(g)

  	
   

  	
  DC Contributors’ Knowledge

  
	
   

  	
   

  	
   

  
	
  1.01(i)

  	
   

  	
  Project X Restructuring

  
	
   

  	
   

  	
   

  
	
  3.06(f)

  	
   

  	
  Orphan Subsidiaries

  
	
   

  	
   

  	
   

  
	
  3.06(g)

  	
   

  	
  Financial Data

  
	
   

  	
   

  	
   

  
	
  5.02(e)

  	
   

  	
  Supplemental Financial
  Reports

  
	
   

  	
   

  	
   

  
	
  5.05(a)

  	
   

  	
  Pre-Closing Restructuring
  Transactions

  
	
   

  	
   

  	
   

  
	
  5.05(b)

  	
   

  	
  Post-Closing Restructuring
  Transactions

  
	
   

  	
   

  	
   

  
	
  5.08(a)

  	
   

  	
  DC Contributors Credit
  Support Instruments

  
	
   

  	
   

  	
   

  
	
  5.08(b)

  	
   

  	
  Additional Efforts for
  Certain Credit Support Instruments

  
	
   

  	
   

  	
   

  
	
  5.09

  	
   

  	
  Surviving Affiliate
  Contracts

  
	
   

  	
   

  	
   

  
	
  5.16(a)

  	
   

  	
  Certain Pre-Closing
  Actions

  
	
   

  	
   

  	
   

  
	
  5.17

  	
   

  	
  FinCo Books and Records

  
	
   

  	
   

  	
   

  
	
  6.01(a)

  	
   

  	
  Excluded Employees

  
	
   

  	
   

  	
   

  
	
  6.01(b)

  	
   

  	
  Transferred Employees

  
	
   

  	
   

  	
   

  
	
  6.04

  	
   

  	
  Certain Individuals with
  Retention Agreements

  
	
   

  	
   

  	
   

  
	
  8.01

  	
   

  	
  Foreign Antitrust and
  Other Governmental Permits

  
	
   

  	
   

  	
   

  
	
  9.02(a)

  	
   

  	
  Indemnification

  
	
   

  	
   

  	
   

  
	
  9.04(d)

  	
   

  	
  Certain Materiality
  References

  

 

vi

 

CONTRIBUTION AGREEMENT (this
“Agreement”), dated as of May 14, 2007, by and among
DAIMLERCHRYSLER NORTH AMERICA FINANCE CORPORATION (“DCNAF”), a Delaware
corporation, DAIMLERCHRYSLER HOLDING CORPORATION, a Delaware corporation (“DC
Holding”, and together with DCNAF, the “DC Contributors”), CG
INVESTOR, LLC, a Delaware limited liability company, (the “Investor”),
an affiliate of Cerberus Capital Management, L.P. and, with respect to Section 5.03
(Confidentiality), and Section 11.10 (Guarantee), DaimlerChrysler AG, a
German Aktiengesellschaft, (the “Guarantor”).

 

WHEREAS, DaimlerChrysler
Company LLC (“DCC”) and DaimlerChrysler Financial Services Americas LLC
(“FinCo”) are directly or through their respective Subsidiaries (as
hereafter defined) engaged in the business of developing, manufacturing,
distributing and selling a wide range of automotive products, mainly full-size,
mid-size and compact cars, minivans, SUVs, parts and accessories, and of
providing customized financing, leasing, insurance and fleet-management
services for retail and commercial customers, at various locations in the
United States and around the world (such business, after giving effect to the
Pre-Closing Restructuring Transactions and the Post-Closing Restructuring Transactions
(both as hereafter defined), the “Company Business”);

 

WHEREAS, after giving effect
to the Pre-Closing Restructuring Transactions and immediately prior to the
Closing (both as hereafter defined), DC Holding will be the record and
beneficial owner of all of the then outstanding limited liability company
interests (the “Company Equity Interests”) of DaimlerChrysler Holding
LLC, a Delaware limited liability company (the “Company”); and

 

WHEREAS, after giving effect
to the Pre-Closing Restructuring Transactions and immediately prior to the
Closing, the Company will directly or through a Subsidiary own all the Equity
Interests (as hereafter defined) in each of DCC and FinCo; and

 

WHEREAS, in accordance with
the terms and conditions set forth herein, DCNAF wishes to contribute to the
Company, in exchange for Company Equity Interests, the Retained Intercompany
Debt (as hereafter defined), and the Investor wishes to contribute to the
Company, in exchange for Company Equity Interests, the Closing Date Cash
Contribution, and the DC Contributors and the Investors wish to enter into the
LLC Operating Agreement (as hereafter defined);

 

NOW, THEREFORE, in
consideration of the premises and of the mutual agreements and covenants
hereinafter set forth, and intending to be legally bound, the DC Contributors
and the Investor hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

SECTION 1.01.  Certain Defined Terms.  For purposes of this Agreement:

 

“Accounting Principles”
means GAAP applied on a basis consistent with the accounting principles,
methods and policies used by the Company and the Company

 

1

 

Subsidiaries, which
principles, methods and policies are set forth on Schedule 1.01(a) (provided,
that in the event of a conflict between GAAP and such accounting principles,
methods and policies, GAAP shall prevail).

 

“Acquisition Proposal”
means any inquiry, proposal or offer from any Person relating to, or that could
reasonably be expected to lead to, (a) any direct or indirect acquisition
or purchase, in one transaction or a series of transactions outside of the
ordinary course of business (including stock acquisitions), of assets, equity
securities or businesses that constitute or generate 20% or more of the
revenues, net income or assets of any of the following (each, an “Acquisition
Target”): (i) the Company, (ii) the Company and its Subsidiaries,
taken as a whole, (iii) the Financial Services Companies, taken as a
whole, (iv) the Industrial Companies, taken as a whole, or (v) prior
to the consummation of the Pre-Closing Restructuring Transactions, any direct
or indirect Subsidiary of the Guarantor that directly or indirectly
participates in or holds material assets of the Financial Services Business or
the Industrial Business (b) any exchange offer or tender offer that, if
consummated, would result in any Person beneficially owning 20% or more of any
class of equity securities of DCC or FinCo; or (c) any merger,
acquisition, consolidation, business combination, recapitalization,
liquidation, dissolution, joint venture, binding share exchange or similar
transaction involving DCC or FinCo pursuant to which any Person would own 20%
or more of any class of equity securities of DCC or FinCo, or of the resulting
direct parent company of DCC or FinCo, in any such case other than the
transactions contemplated by this Agreement.

 

“Action” means any
claim, action, suit, arbitration, inquiry or proceeding by or before any
Governmental Authority.

 

“Additional Cash Amount”
means the greater of (a) $2 billion and (b) the amount agreed to by
the DC Contributors and the Investor pursuant to Section 5.19(b)(iii).

 

“Additional DCNAF
Contribution” means the aggregate amount, if any, by which the DCNAF
Contribution is increased pursuant to Section 2.03(c).

 

“Affiliate” means,
with respect to any specified Person, any other Person that directly, or
indirectly through one or more intermediaries, controls, is controlled by, or
is under common control with, such specified Person.

 

“Ancillary Agreements”
means the (a) CAFE Credits Sharing Agreement, (b) Cooperation
Agreement for Project “Adaptation Work for Diesel Engines/Control Systems”, (c) Cooperation
Agreement for Project “Common V6”, (d) Cooperation Agreement for Project “Common
Unibody SUV”, (e) Cooperation Agreement for Project “Common Axle”, (f) Cooperation
Agreement for Project “Fuel Cell Vehicle”, (g) DCC/Guarantor Transition
Services Agreement, (h) FinCo/DCFS USA Transition Services Agreement, (i) FinCo/Guarantor
Transition Services Agreement, (j) Fuel Cell R&D Agreement, (k) Future
Business Model in China and South Korea Agreements, (l) International
Distribution Agreement, (m) International Financial Services Cooperation
Agreement, (n) ITM Cooperation Agreement, (o) LLC Operating Agreement,
(p) Master ER&D Agreement, (q) Parts Distribution Centers
Agreement, (r) Procurement and Supply Cooperation Agreement, (s) Sprinter
Distribution Agreement, (t)

 

2

 

Technology Sharing
Agreement, (u) Trademark Agreement and (v) ZEV Credits Sharing
Agreement.

 

“Antitrust Laws”
shall mean the Sherman Act, the Clayton Act, the HSR Act, the Federal Trade
Commission Act, in each case as amended, and all other federal, provincial,
state and foreign statutes, rules, regulations, orders, decrees, administrative
and judicial doctrines and other laws that (a) are designed or intended to
prohibit, restrict or regulate actions having the purpose or effect of
monopolization or restraint of trade or the lessening of competition through
merger or acquisition or (b) involve foreign investment review by
Governmental Authorities.

 

“Business Day” means
any day that is not a Saturday, a Sunday or other day on which banks are
required or authorized by Law to be closed in Stuttgart, Germany or the City of
New York.

 

“Business Sale
Transaction” means any transaction or series of transactions involving any
of the Company, the Investor or any of their respective Affiliates or
successors that directly or indirectly results in the Investor or any of its
Affiliates receiving proceeds as a result of any sale, assignment, conveyance
or other transfer of (without duplication) (a) all or substantially all of
the Investor Equity Interests, including proceeds received in respect of
(without duplication) (i) any merger, consolidation, reorganization or
other business combination pursuant to which the Company or any successor is
combined with one or more Persons, and as a result of which Persons other than
the members of the Company (or equity holders of its successor) immediately
prior to such transaction and their Affiliates will own all or substantially
all of the equity interests or voting power of the Company or its successor, as
the case may be, or (ii) the acquisition, directly or indirectly, by one
or more Persons (other than the members of the Company immediately prior to
such acquisition and their Affiliates) of all or substantially all of the then
outstanding Investor Equity Interests by way of a tender or exchange offer,
negotiated purchase, sale, transfer, exchange or other means, or (b) all
or substantially all of the assets of the Company and the Company Subsidiaries
taken as a whole.

 

“CAFE Credits Sharing
Agreement” means the CAFE Credits Sharing Agreement to be executed by the
Guarantor and DCC at the Closing, which shall be consistent with the term sheet
attached hereto as Exhibit A.

 

“Canada/Quebec Pension
Plans” means, as applicable, the Canadian Pension Plan as set out in the
Canada Pension Plan, R.S.C. 1985, c. C-8, as amended, and the Quebec Pension
Plan as set out in An Act Respecting The Quebec Pension Plan, R.S.Q. c. R-9, as
amended.

 

“Canadian Transfer
Pricing Dispute” means the dispute between DaimlerChrysler Canada Inc. and
the Canadian Revenue Agency in relation to transfer pricing for services
provided by DaimlerChrysler Canada Inc. to DaimlerChrysler Corporation
described as item 1. in Section 3.16 of the Disclosure Schedule.

 

“Canadian Transfer
Pricing Provision” means the reserve for Taxes treated as a liability and
the amount treated as an asset for a refund of Taxes in respect of the Canadian
Transfer Pricing Dispute on the audited balance sheet dated December 31,
2006 of the Industrial Companies provided to Investor pursuant to Section 3.06(a)(i).

 

3

 

“Cash/Debt
Indemnification Amount” means the sum of (a) the Entity Cash
Indemnification Amount, and (b) the Entity Debt Indemnification Amount.

 

“Closing Date Cash
Contribution” means $7.176 billion.

 

“Closing Price”, with
respect to any securities on any day, means (a) if such securities are
listed and traded on the New York Stock Exchange, Inc. (“NYSE”),
the closing price on such day as reported on the NYSE Composite Transactions
Tape;  (b) if such securities are
not listed and traded on the NYSE, the closing price as reported on such day by
the principal national securities exchange on which such securities are listed
or traded;  (c) if such securities
are not listed and traded on any such securities exchange, the last reported
sale price on such day on The Nasdaq Stock Market (“Nasdaq”); or (d) if
such securities are not then traded on but are quoted by Nasdaq, the average of
the highest reported bid and the lowest reported ask price on such day as
reported by Nasdaq.

 

“Code” means the
Internal Revenue Code of 1986, as amended through the date hereof.

 

“Collective Bargaining
Agreement” means any written or oral agreement, understanding or mutually
recognized past practice between the Company or any Company Subsidiary, and any
labor organization with respect to the Company Employees.

 

“Company Benefit Plans”
means employee benefit plans (as defined in Section 3(3) of ERISA)
and bonus, stock option, stock purchase, restricted stock, incentive, deferred
compensation, retiree or other medical (including retiree medical) or life
insurance, retirement, supplemental retirement, severance or other benefit
plans, programs or arrangements, and employment, termination, severance or
other contracts or agreements, to which the Company or any Company Subsidiary
is a party, with respect to which the Company or any Company Subsidiary has any
obligation or which are maintained, contributed to or sponsored by the Company
or any Company Subsidiary for the benefit of any current or former employee,
officer or director of the Company or any Company Subsidiary and all short or
long term incentive plans, programs or arrangements sponsored or maintained by
the Guarantor or any of its Affiliates, other than the Company or any Company
Subsidiary, in which current or former employees, officers or directors of the
Company or any Company Subsidiary participate; provided,  however, that Company Benefit
Plans shall not include (a) any retention, stay bonus or other incentive
plan, program, arrangement or agreement for which the Guarantor or any of its
Affiliates, other than the Company or any Company Subsidiary, has full
liability and responsibility as of the date of this Agreement and will retain
such liability and responsibility upon consummation of the transactions
contemplated by this Agreement, or (b) the Canada/Quebec Pension Plans.

 

“Company Employees”
means (a) each individual employed by the Company or any Company
Subsidiary (including employees currently on long or short term disability,
military or other leave and employees on layoff status or with recall rights;
and each individual recognized under any Collective Bargaining Agreement as
being employed by or having rights to employment by the Company or any Company
Subsidiary) as of the Closing Date other than those individuals listed on
Schedules 5.05(b) and 6.01(a), and (b) those individuals employed by

 

4

 

either of the DC
Contributors or the Guarantor as of the Closing Date and listed on Schedule
6.01(b).

 

“Company Equity Award
Holder” means any current or former employee of the Company or any Company
Subsidiary who holds (or who as of December 31, 2006 held) a stock option,
stock appreciation right or phantom share award under the Parent Equity Plans.

 

“Company Equity Award
Holder Payments” the amounts actually paid by the Company and the Company
Subsidiaries to the Company Equity Award Holders and the Guarantor during the
period from January 1, 2007 to the Closing Date with respect to (i) payout
upon exercise of stock appreciation rights held by Company Equity Award Holders
under the Parent Equity Plans, (ii) payout of phantom shares granted to
Company Equity Award Holders under the Guarantor’s 2005, 2006 and 2007
Performance Phantom Share Plan and (iii) the difference between the “reference
price” and the “exercise price” (each as defined in the applicable stock option
agreement or stock option plan summary) in connection with the exercise of
stock options granted to Company Equity Award Holders under the Parent Equity
Plans.

 

“Company
Intellectual Property” means the Company Owned Intellectual Property and
the Company Licensed Intellectual Property.

 

“Company IP Agreements”
means all licenses of Intellectual Property (a) from the Company or any
Company Subsidiary to any third party, excluding licenses to customers and end
users granted in the ordinary course of business, and (b) to the Company
or any Company Subsidiary from any third party, excluding Shrink-Wrap
Agreements.

 

“Company IT Agreements”
means all agreements concerning the use of Company IT Systems to which the
Company or any Company Subsidiary is a party.

 

“Company IT Systems”
means all IT Systems which are used or held for use in connection with the
operation of the Company Business.

 

“Company Leased Real
Property” means the real property which is material to the Financial
Services Business or the Industrial Business and is leased, licensed or
subleased to, or otherwise used or occupied (but not owned) by, the Company, or
any Company Subsidiary, in each case, as tenant or licensee, together with, to
the extent leased by the Company or any Company Subsidiary, all buildings and
other structures, facilities or improvements currently or hereafter located
thereon, all fixtures, building systems, equipment and items of personal
property of the Company or any Company Subsidiary attached or appurtenant
thereto which cannot be removed, and all easements, licenses, rights and
appurtenances relating to the foregoing.

 

“Company Licensed
Intellectual Property” means all Intellectual Property which the Company or
any Company Subsidiary is licensed to use pursuant to the Company IP
Agreements.

 

“Company Material Adverse
Effect” means one or more circumstances, changes, effects, events or
developments, or series of any of the foregoing, that, individually or in the
aggregate, is or is reasonably likely to be materially adverse to the business,
properties, assets,

 

5

 

consolidated results of
operations or consolidated financial condition of the Company and the Company
Subsidiaries, taken as a whole (provided, however, that the term “Company
Material Adverse Effect” shall not include any changes, circumstances or
effects that result from or are consequences of: (a) events,
circumstances, changes or effects that generally affect the industry in which
the Company and the Company Subsidiaries operate, (b) general economic
conditions or events, circumstances, changes or effects affecting the
securities markets generally, (c) discussions or negotiations (or the
absence thereof) with unions, strikes, slowdowns or work stoppages, (d) changes
in laws, rules or regulations of any Governmental Authority, or changes in
regulatory conditions in the countries in which the Company or any Company
Subsidiaries operate not having a materially disproportionate adverse effect on
the Company and the Company Subsidiaries as compared to their competitors, (e) changes
in prevailing interest rates or foreign exchange rates, (f) changes in
accounting standards, principles or interpretations, (g) changes arising
from the consummation of the transactions contemplated by, or the announcement
of the execution of, this Agreement, including (i) any actions of
competitors, (ii) any losses of employees, or (iii) any delays or
cancellations of orders for products or services, (h) any reasonably
proportionate reduction in the price of services or products offered by the
Company and the Company Subsidiaries in response to the reduction in price of
comparable services or products offered by a significant competitor, (i) any
circumstance, change or effect that results from any action required or
contemplated to be taken pursuant to or in accordance with this Agreement or
any action taken at the written request of the Investor, and (j) changes
caused by a material worsening of current conditions caused by acts of
terrorism or war (whether or not declared) occurring after the date hereof not
having a materially disproportionate adverse effect on the Company and the Company
Subsidiaries as compared to their competitors.

 

“Company Owned
Intellectual Property” means all Intellectual Property which is owned by
the Company or a Company Subsidiary.

 

“Company Owned Real
Property” means the real property which is material to the Financial
Services Business or the Industrial Business and in which the Company or any
Company Subsidiary holds fee title (or equivalent) interest, together with all
buildings and other structures, facilities or improvements currently or
hereafter located thereon, all fixtures, building systems, equipment and items
of personal property of the Company or any Company Subsidiary attached or
appurtenant thereto which cannot be removed and all easements, licenses, rights
and appurtenances relating to the foregoing.

 

“Company
Real Property” means, collectively, all Company Owned Real Property and
Company Leased Real Property.

 

“Company Subsidiary”
means each Subsidiary of the Company after giving effect to the Pre-Closing
Restructuring Transactions and the Post-Closing Restructuring Transactions,
including the Persons set forth on Schedule 1.01(b).

 

“Computer Software”
means any and all computer programs, including operating system and
applications software, implementations of algorithms, program interfaces, and
databases whether in source code or object code and all documentation,
including user manuals, relating to the foregoing.

 

6

 

“Contingent Obligation”
means, as applied to any Person, any direct or indirect contingent liability of
that Person with respect to (a) any Indebtedness, lease, dividend, letter
of credit or other financial obligation of another, including any such
obligation directly or indirectly guaranteed, endorsed, co-made or discounted
or sold with recourse by that Person, or in respect of which that Person is
otherwise directly or indirectly liable; (b) any obligations with respect
to undrawn letters of credit issued for the account of that Person; and (c) all
obligations arising under any Derivative Transaction; provided, however,
that the term “Contingent Obligation” shall not include endorsements for
collection or other deposit in the ordinary course of business. The amount of
any Contingent Obligation shall be deemed to be an amount equal to the stated
or determined amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof.

 

“Contracts” means all
contracts, leases, licenses, arrangements, notes, bonds, mortgages, indentures,
franchise agreements, instruments, commitments, undertakings and other
agreements and binding obligations (including any amendments and other
modifications thereto), whether written or, with respect to third parties only,
oral, to which the Company or any Subsidiary thereof is a party or by which any
of their respective businesses, properties or assets is bound; provided,
however, that “Contracts” shall not include any Collective
Bargaining Agreement, Permit, Environmental Permits or obligations pursuant to
Environmental Laws.

 

“control” (including
the terms “controlled by” and “under common control with”), with
respect to the relationship between or among two or more Persons, means the
possession, directly or indirectly, as trustee, personal representative or
executor, of the power to direct or cause the direction of the affairs or
management of a Person, whether through the ownership of voting securities, as
trustee, personal representative or executor, by contract or otherwise.

 

“Conveyance Taxes”
means any transfer, documentary, sales, use, stamp, registration and other such
taxes, any conveyance fees, any recording charges and any other fees and
charges (including penalties and interest in respect thereof) arising from the
purchase and sale of the Investor Equity Interests pursuant to this Agreement.

 

“Cooperation Agreement
for Project ‘Adaptation Work for Diesel Engines/Control Systems’” means the
Cooperation Agreement to be executed by the Guarantor and DCC at the Closing,
which shall be consistent with the term sheet attached hereto as Exhibit B.

 

“Cooperation Agreement
for Project ‘Common Axle’” means the Cooperation Agreement to be executed
by the Guarantor and DCC at the Closing, which shall be consistent with the
term sheet attached hereto as Exhibit C.

 

“Cooperation Agreement
for Project ‘Common Unibody SUV’” means the Cooperation Agreement to be
executed by the Guarantor and DCC at the Closing, which shall be consistent
with the term sheet attached hereto as Exhibit D.

 

7

 

“Cooperation Agreement
for Project ‘Common V6’” means the Cooperation Agreement to be executed by
the Guarantor and DCC at the Closing, which shall be consistent with the term
sheet attached hereto as Exhibit E.

 

“Cooperation Agreement
for Project ‘Fuel Cell Vehicle’” means the Cooperation Agreement to be
executed by the Guarantor and DCC at the Closing, which shall be consistent
with the term sheet attached hereto as Exhibit F.

 

“DC Contributors
Disclosure Schedule” means the schedule, dated as of the date hereof,
delivered by the DC Contributors to the Investor in connection with this
Agreement.  Notwithstanding anything to
the contrary contained in the DC Contributors Disclosure Schedule or in this
Agreement, the information and disclosures contained in any section of the DC
Contributors Disclosure Schedule relating to representations and warranties
shall be deemed to be disclosed and incorporated by reference in any other section
of the DC Contributors Disclosure Schedule relating to representations and
warranties as though fully set forth in such other section, for which the
applicability of such information and disclosure is reasonably apparent on the
face of such information or disclosure.

 

“DC Contributors
Intellectual Property” means the Intellectual Property owned by the
Guarantor and used in or held for use in the operation of the Company Business.

 

“DC Contributors Material
Adverse Effect” means any material adverse effect on the ability of the DC
Contributors to consummate the transactions contemplated by this Agreement or
perform their obligations hereunder.

 

“DC Contributors’
Knowledge”, “Knowledge of the DC Contributors” or similar terms used
in this Agreement mean the actual (but not constructive or imputed) knowledge
of the Persons listed on Schedule 1.01(g) as of the date of this Agreement
(or, with respect to a certificate delivered pursuant to this Agreement, as of
the date of delivery of such certificate) without any implication of
verification or investigation concerning such knowledge.

 

“DCC” means
DaimlerChrysler Company LLC, a Delaware limited liability company.

 

“DCC/Guarantor Transition
Services Agreement” means the DCC/Guarantor Transition Services Agreement
to be executed by the Guarantor and DCC at the Closing, which shall be
consistent with the term sheet attached hereto as Exhibit G.

 

“DCMH” means
DaimlerChrysler Mexico Holding, S.A. de C.V.

 

“DCNAF Contribution”
means the portion of the Retained Intercompany Debt transferred to the Company
pursuant to Section 2.03(b)(iii).

 

“Derivative Transactions”
shall mean any swap transaction, option, warrant, forward purchase or sale
transaction, futures transaction, cap transaction, floor transaction or collar
transaction relating to one or more currencies, commodities, bonds, equity
securities, loans, interest rates, credit-related events or conditions or any
indexes, or any other similar transaction or combination of any such
transactions, including collateralized mortgage

 

8

 

obligations or other similar
instruments or any debt or equity instruments evidencing or embedding any such
types of transactions, master netting agreement and any related credit support,
margin payments, transfers, collateral or other similar arrangements related to
such transactions, except, notwithstanding the foregoing, excluding in all
cases forward contracts for commodities entered into to effect ordinary course
purchases of commodities by the Company or the Company Subsidiaries.

 

“Electronic Data Room”
means the electronic data room that was prepared and maintained in connection
with the transactions contemplated by this Agreement.

 

“Eligible Distributions”
means any distributions made by the Company or its successor to the Investor or
its Affiliates from and after the Closing Date through the second anniversary
of the Closing Date, other than distributions of operating profits of the
Company or distributable cash (as determined pursuant to the LLC Operating
Agreement) generated from the operation of the Company’s Business in accordance
with the LLC Operating Agreement.

 

“Encumbrance” means
any mortgages, deeds of trust, deeds to secure debt, pledges, liens (including
liens imposed by Law, such as, but not limited to, mechanics liens), claims,
security or other interests (including any reversionary interests), conditional
and installment sale agreements or other title retention agreements, options to
purchase or lease real property, charges, easements and other conditions,
covenants, zoning and any other restrictions, encumbrances or other matters
affecting title of any kind.

 

“Entity Cash Amount”
means cash and intercompany receivables of DCC and its Subsidiaries calculated (a) in
accordance with the Accounting Principles on a consolidated basis as of the
close of business in each relevant jurisdiction on March 31, 2007 and (b) using
the categories of accounts and adjustments detailed in the Calculation of
Entity Cash Amount set forth in Schedule 1.01(d).

 

“Entity Cash
Indemnification Amount” means an amount equal to the excess, if any, of (a) the
amount set forth on Schedule 3.27(a) of the DC Contributors Disclosure
Schedule, over (b) the Entity Cash Amount.

 

“Entity Debt Amount”
means Indebtedness of DCC and its Subsidiaries calculated (a) in
accordance with the Accounting Principles on a consolidated basis as of the
close of business in each relevant jurisdiction on March 31, 2007 and (b) using
the categories of accounts and adjustments detailed in the Calculation of
Equity Debt Amount set forth in Schedule 1.01(e).

 

“Entity Debt
Indemnification Amount” means an amount equal to the excess, if any, of (a) the
Entity Debt Amount, over (b) the amount set forth on Schedule 3.27(b) of
the DC Contributors Disclosure Schedule.

 

“Environmental Claim”
means any and all written complaints, summons, citations, directives, orders,
claims, litigation, investigations, notices of violation, judgments,
administrative, regulatory or judicial actions, suits, demands or proceedings,
or written notices of noncompliance or violation by any Governmental Authority
or Person involving or alleging potential liability arising out of or resulting
from any violation of Environmental Law or the

 

9

 

presence or Release of
Hazardous Materials from or relating to: (a) any assets, properties or
businesses of the Company or any Company Subsidiary or any entity that is a
predecessor to the Company or a Company Subsidiary; (b) any adjoining
properties or businesses; or (c) any facilities receiving or handling
Hazardous Materials generated by the Company or any Company Subsidiary or any
entity that is a predecessor to the Company or a Company Subsidiary.

 

“Environmental Law”
means any applicable federal, state, local or foreign statute, law, ordinance,
regulation, rule, code, order, consent decree or judgment, in each case in
existence at the date hereof, relating to the management of, or Release or
Remedial Actions involving, Hazardous Materials, the exposure of humans to
Hazardous Materials, pollution, or the protection of human health and the
environment, including surface water, groundwater, ambient air, surface or
subsurface soil, natural resources or wildlife habitat.

 

“Environmental
Liabilities” means any monetary obligations, losses, liabilities (including
strict liability), damages, punitive damages, consequential damages, treble
damages, natural resource damages, costs and expenses (including all reasonable
out-of-pocket fees, disbursements and expenses of counsel, out-of-pocket expert
and consulting fees and out-of-pocket costs for environmental site assessments,
remedial investigations and feasibility studies), fines, penalties, sanctions
and interest incurred as a result of a Release or threatened Release of
Hazardous Materials, the presence of Hazardous Materials in violation of
Environmental Laws or any Environmental Claim filed by any Governmental
Authority or any third party that relates to any violations of Environmental Laws,
any Remedial Actions, or any Releases or threatened Releases of Hazardous
Materials from or onto (a) any property or facility presently or formerly
owned by the Company, or any Company Subsidiary or any entity that is a
predecessor to the Company or a Company Subsidiary, or (b) any facility
which received Hazardous Materials generated by the Company or any Company
Subsidiary or any entity that is a predecessor to the Company or a Company
Subsidiary.

 

“Environmental Lien”
means any Encumbrance in favor of any Governmental Authority authorized under
any Environmental Law as a result of an Environmental Claim requiring a deed
restriction, covenant, easement, land use restriction or similar encumbrance
filed or recorded in accordance with Environmental Law.

 

“Environmental
Permit” means any permit, approval, license or other authorization required
under or issued pursuant to any applicable Environmental Law.

 

“Equity Interests”
means, with respect to any Person, shares of capital stock of (or other
ownership or profit interests in) such Person, warrants, options or other
rights for the purchase or other acquisition from such Person of shares of
capital stock of (or other ownership or profit interests in) such Person,
securities convertible into or exchangeable for shares of capital stock of (or
other ownership or profit interests in) such Person or warrants, options, or
rights for the purchase or other acquisition from such Person of such shares
(or such other ownership or profits interests), and other ownership or profit
interests in such Person (including partnership, member or trust interests
therein), whether voting or nonvoting.

 

“ERISA” means the
Employee Retirement Income Security Act of 1974, as amended, and any
regulations promulgated thereunder.

 

10

 

“Exchange Act” means
the Securities Exchange Act of 1934, as amended.

 

“Excluded Taxes”
means (a) Taxes for any taxable period that ends on or before the Closing
Date (or, if applicable, in respect of any Delayed Closing Entities, the
Delayed Closing Date), (b) with respect to Straddle Periods, Taxes that
are allocable, pursuant to Section 7.01(b), to the account of either of
the DC Contributors, (c) Taxes for which the Company or any Company
Subsidiary are held liable under Section 1.1502-6 of the Treasury
Regulations (or any similar provision of state, local or foreign law) by reason
of the Company or any Company Subsidiary (including, for the avoidance of
doubt, their respective predecessors) being included in any consolidated,
affiliated, combined or unitary group with the DC Contributors (or any
Affiliates of the DC Contributors) at any time before the date of the Closing, (d) Taxes
that relate to and are imposed in connection with (i) the Pre-Closing Restructuring
Transactions, (ii) the Post-Closing Restructuring Transactions, (iii) the
formation and subsequent transfer to the Company of the NSCs and (iv) the
transactions set forth in Sections 2.03(b)(ii), 2.03(b)(iii) and 2.03(b)(v) and
(e) any Taxes or payments in respect of Taxes arising under or pursuant to
a Tax indemnification obligation with a third party; provided, however,
that Excluded Taxes shall not include any amount of Taxes that is not in excess
of the aggregate amount accrued or reserved for Taxes described in clause (a) or
(b) above treated as a liability in the audited balance sheet dated December 31,
2006 of the Financial Services Companies or the Industrial Companies provided
to Investor pursuant to Section 3.06(a)(i) or (ii) (but not including
any amounts of the Canadian Transfer Pricing Provision), but only to the extent
that such Tax is a Tax imposed primarily and directly on the Company or any
Company Subsidiary (for example, such reserves for Taxes will include federal,
state, local and foreign income taxes (other than in respect of the Canadian
Transfer Pricing Provisions) imposed on a Company Subsidiary that is classified
as a corporation for U.S. federal income tax purposes after the Closing Date,
but will not include such United States federal, state and local income taxes
which arise in respect of any entity which, after the Closing Date, is taxable
as a partnership, disregarded entity or other pass-through vehicle for U.S.
federal income tax purposes.  Similarly,
such Tax reserves shall include a property tax or other non-income tax imposed
on a limited liability company disregarded as an entity separate from its owner
for U.S. federal income tax purposes).

 

“Final Reimbursement
Amount” means the sum of (a) $950 million, (b) the excess, if
any, of $850 million over the Reimbursed Amount and (c) the excess, if
any, of $236 million over the Estimated Company Equity Award Holder Payments.

 

“Finance Agreements”
means any financing, secured lending facility, lending, leasing, underwriting,
purchase or sale of loans, syndication, investment, management, participation,
hedging, swap or servicing agreement or arrangement of any Financial Services
Company.

 

“Financial Services
Business” means the business of the Financial Services Companies, after
giving effect to the occurrence of the Pre-Closing Restructuring Transactions,
the other pre-Closing transactions contemplated by this Agreement and
consummated on or prior to the Closing Date, and the Post-Closing Restructuring
Transactions.

 

11

 

“FinCo/DCFS USA
Transition Services Agreement” means the FinCo/DCFS USA Transition Services
Agreement to be executed by the Guarantor and FinCo at the Closing, which shall
be consistent with the term sheet attached hereto as Exhibit H.

 

“FinCo/Guarantor
Transition Services Agreement” means the FinCo/Guarantor Transition
Services Agreement to be executed by the Guarantor and FinCo at the Closing,
which shall be consistent with the term sheet attached hereto as Exhibit I.

 

“Fuel Cell R&D
Agreement” means the Fuel Cell R&D Agreement to be executed by the
Guarantor and DCC at the Closing, which shall be consistent with the term sheet
attached hereto as Exhibit J.

 

“Fundamental Documents”  shall mean the
documents by which any Person (other than an individual) establishes its legal
existence or which govern its internal affairs. 
For example, the “Fundamental Documents”  of a limited
liability company would be its certificate or articles of formation and limited
liability company agreement or operating agreement and the “Fundamental
Documents”  of
a corporation would be its certificate or articles of incorporation and its
bylaws.

 

“Funded Indebtedness”
means indebtedness for borrowed money (including intercompany loans between DCC
or a Subsidiary of DCC, on the one hand, and either of the DC Contributors or
an Affiliate of either of the DC Contributors, other than the Company or a
Company Subsidiary, on the other hand), including indebtedness evidenced by
notes, debentures, bonds or similar instruments.

 

“Future Business Model in
China and South Korea Agreements” means the Future Business Model in China
and South Korea Agreements to be executed by the appropriate parties at the
Closing, which shall be consistent with the term sheet attached hereto as Exhibit K.

 

“GAAP” means United
States generally accepted accounting principles in effect from time to time
applied consistently throughout the periods involved.

 

“Governmental Authority”
means any federal, national, international, supranational, state, provincial,
local or other government, governmental, regulatory or administrative
authority, agency or commission or any court, tribunal, or judicial or arbitral
body (including private arbitrators or arbitral panels to the extent empowered
to issue binding decisions).

 

“Governmental Order”
means any order, writ, judgment, injunction, decree, stipulation, determination
or award entered by or with any Governmental Authority.

 

“Guarantor Material
Adverse Effect” means any material adverse effect on the ability of the
Guarantor to perform its obligations hereunder.

 

“Hazardous Material”
means (a) any petroleum, petroleum product, by-product or breakdown
product, radioactive material, asbestos-containing material or polychlorinated
biphenyl; (b) any chemical, material or substance defined, listed,
regulated or otherwise classified as toxic or hazardous, as a pollutant or
contaminant, or as hazardous waste, medical

 

12

 

waste, biohazardous or
infectious waste or special waste or solid waste under any applicable
Environmental Law; (c) any substance exhibiting a hazardous waste
characteristic including corrosivity, ignitability, toxicity or reactivity as
well as any explosive material; or (d) any building material that impairs
human health including material containing asbestos, manganese or silica.

 

“Headquarters
Reimbursement Amount” means an amount equal to the cash costs, other than
costs related to the Parent Equity Plans, incurred and paid by the Company or
any Company Subsidiary during the period between March 31, 2007 and the
Closing Date, calculated in accordance with the Accounting Principles, which
costs have historically been referred to as “Headquarters Allocation” in the
income statement of the Company and the Company Subsidiaries.

 

“HSR Act” means the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and
regulations promulgated thereunder.

 

“Indebtedness” of any
Person means, without duplication, (a) all indebtedness of such Person
(including, in the case of the Company or a Company Subsidiary, intercompany
loans between such Person, on the one hand, and either of the DC Contributors
or an Affiliate of either of the DC Contributors (other than the Company or a
Company Subsidiary), on the other hand), whether secured or unsecured, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, (c) all indebtedness of such Person for the deferred purchase
price of property or services, excluding trade accounts payable, (d) all
indebtedness of such Person created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property), (e) all indebtedness of such Person secured by a purchase money
mortgage or other Encumbrance to secure all or part of the purchase price of
the property subject to such mortgage or Encumbrance, (f) all the
obligations of such Person under leases which shall have been or are required
to be, in accordance with GAAP, recorded as capital leases in respect of which
such Person is liable as a lessee, (g) all obligations of such Person in
respect of unreimbursed amounts under drawn letters of credit, (h) all
direct or indirect guarantees by such Person of Indebtedness of others, (i) all
Indebtedness of others which such Person has agreed (contingently or otherwise)
to purchase or otherwise acquire or in respect of which it has otherwise
assured a creditor against loss, and (j) all interest, fees, penalties
(including prepayment penalties or premiums) and other expenses owed (in
connection with the repayment thereof) by such Person with respect to the
indebtedness or obligations referred to in any of clauses (a) through (i) above.

 

“Indemnified Party”
means an Investor Indemnified Party or a DC Contributors Indemnified Party, as
the case may be.

 

“Indemnifying Party”
means the DC Contributors pursuant to Section 9.02 and the Investor
pursuant to Section 9.03, as the case may be.

 

“Industrial Business”
means the business of the Industrial Companies, after giving effect to the
occurrence of the Pre-Closing Restructuring Transactions, the other pre-Closing

 

13

 

transactions contemplated by
this Agreement and consummated on or prior to the Closing Date, and the
Post-Closing Restructuring Transactions.

 

“Initial Public Offering”,
with respect to any Person, means an initial public offering of the equity
securities of such Person, whether such offering is primary or secondary, and
without regard to the size of such offering.

 

“Insurance Agency”
means DaimlerChrysler Insurance Agency, Inc.

 

“Insurance Contracts”
means all policies, binders, slips, certificates, guaranteed insurance
contracts, surety bonds, and participation agreements and other agreements of
insurance or reinsurance (whether ceded or assumed), whether individual or
group, in effect as of the date hereof (including all applications,
supplements, endorsements, riders and ancillary documents in connection
therewith) that are issued by an Insurance Subsidiary.

 

“Insurance Subsidiary”
means DaimlerChrysler Insurance Company.

 

“Intellectual Property”
means (a) patents, patent applications and invention disclosures, (b) trademarks,
service marks, trade names, trade dress, Internet domain names and other
indicia of origin or source to the extent protected as intellectual property
under applicable Law, together with the goodwill associated exclusively
therewith, (c) copyrights, including copyrights in Computer Software, (d) confidential
and proprietary information, including trade secrets, know-how and inventions,
and (e) registrations and applications for registration of the foregoing.

 

“Intercompany Contract”
means (a) a Contract between DCC or a Subsidiary thereof, on the one hand,
and FinCo or a Subsidiary thereof, on the other hand, or (b) a Contract
between the Company, on the one hand, and a Company Subsidiary, on the other
hand.

 

“Intercompany
Indebtedness” means Indebtedness owed by the Company or any Company
Subsidiary to the Guarantor or any Subsidiary of the Guarantor (other than the
Company or any Company Subsidiary).

 

“Intercompany Receivable”
means Indebtedness owed to DCC in the amount of $3,240,130,997 and listed on
the attached Schedule 1.01(c).

 

“International
Distribution Agreement” means the International Distribution Agreement to
be executed by the Guarantor, DCC and Chrysler International Corporation at the
Closing, which shall be consistent with the term sheet attached hereto as Exhibit L.

 

“International Financial
Services Cooperation Agreement” means the International Financial Services
Cooperation Agreement to be executed by the Guarantor and the Company at the
Closing, which shall be consistent with the term sheet attached hereto as Exhibit M.

 

“Investor Disclosure
Schedule” means the schedule, dated as of the date hereof, delivered by the
Investor to the DC Contributors in connection with this Agreement.  Notwithstanding anything to the contrary
contained in the Investor Disclosure Schedule or in this

 

14

 

Agreement, the information
and disclosures contained in any section of the Investor Disclosure relating to
representations and warranties shall be deemed to be disclosed and incorporated
by reference in any other section of the Investor Contributors Disclosure
Schedule relating to representations and warranties, as though fully set forth
in such other section, for which the applicability of such information and
disclosure is reasonably apparent on the face of such information or
disclosure.

 

“Investor Equity
Interests” means all the limited liability company interests of the Company
that are issued to the Investor and its Affiliates at Closing, as adjusted to
reflect any equity split, equity dividend, recapitalization or similar
transaction of the Company.

 

“Investor Material
Adverse Effect” means any material adverse effect on the ability of the
Investor to consummate the transactions contemplated by this Agreement or
perform its obligations hereunder.

 

“Investor’s Knowledge”,
“Knowledge of the Investor”, or similar terms used in this Agreement,
mean the actual (but not constructive or imputed) knowledge of the Persons
listed on Schedule 1.01(f) as of the date of this Agreement (or, with
respect to a certificate delivered pursuant to this Agreement, as of the date
of delivery of such certificate) without any implication of verification or
investigation concerning such knowledge.

 

“IRS” means the
Internal Revenue Service of the United States.

 

“ITM Cooperation
Agreement” means the ITM Cooperation Agreement to be executed by the
Guarantor and the Company at the Closing, which shall be consistent with the
term sheet attached hereto as Exhibit N.

 

“IT Systems” means
all Computer Software and all electronic data processing, data communication
lines, telecommunication lines, firmware, hardware, Internet websites and other
information technology equipment.

 

“Law” means any
federal, national, international, supranational, state, provincial, local or
similar (including foreign) statute, law, ordinance, regulation, rule, code,
order, requirement or rule of law (including common law).

 

“Leased Portfolio”
means the portfolio of vehicles that are (a) for United States federal
income tax purposes owned by the Company or any Financial Services Company on
the Closing Date and (b) as of the Closing Date, subject to a lease under
the different lease programs of any of the Financial Services Companies.

 

“Liabilities” means
any and all debts, liabilities and obligations of any kind whatsoever, whether
asserted or unasserted, accrued or fixed, contingent or absolute, determined or
determinable, or otherwise, including those arising under any Law, Action or
Governmental Order and those arising under any Contract.

 

“Licensed
Transferred Intellectual Property” means the Company Owned Intellectual
Property licensed by the Investor or one or more of its Affiliates to the DC

 

15

 

Contributors or one or more
Affiliates of the DC Contributors pursuant to the Intellectual Property
Agreement.

 

“Like-Kind Exchange
Program” means the like-kind exchange program of FinCo pursuant to the
Master Tax-Deferred Exchange And Trust Agreement, dated August 30, 2006,
among DaimlerChrysler Bank US, DaimlerChrysler Corporation, FinCo LLC, DCFS
Trust, LaSalle Bank N.A. and DCFS Account Services, LLC, as amended through the
Closing Date.

 

“LLC Operating Agreement”
means the Amended and Restated LLC Operating Agreement to be executed by the
Company, the DC Contributors and the Investor at the Closing, which shall be
consistent with the term sheet attached hereto as Exhibit O.

 

“Master ER&D
Agreement” means the Master ER&D Agreement to be executed by the
Guarantor and the Company at the Closing, which shall be consistent with the
term sheet attached hereto as Exhibit P.

 

“Other Retained
Intercompany Debt” means Retained Intercompany Debt with a fair market
value equal to the principal amount of the Subordinated Note.

 

“Partial Realization
Transaction” means any sale or disposition (other than to co-investors
within six months after the Closing Date or to Affiliates other than portfolio
companies) of any portion of the Investor Equity Interests, other than in
connection with a Business Sale Transaction.

 

“Parts Distribution
Centers Agreement” means the Parts Distribution Centers Agreement to be
executed by DCC, Mercedes-Benz USA LLC and Mercedes-Benz Canada Inc. at the
Closing, which shall be consistent with the term sheet attached hereto as Exhibit Q.

 

“Per Unit Value Invested”
means (a) the amount of the Closing Date Cash Contribution divided by (b) the
number of units of membership interest in the Company (or other equity
securities) that constitute the Investor Equity Interests.

 

“Permits” means all
licenses, certificates (including certificates of occupancy), authorizations,
consents, permits (including zoning permits), approvals and other similar
authorizations of, from, or by a Governmental Authority.

 

“Permitted Encumbrances”
means (a) statutory liens for current Taxes not yet due, payable or
delinquent (or which may be paid without interest or penalties) or the validity
or amount of which is being contested in good faith by appropriate proceedings
(provided that, only to the extent that such liens relate to a period ending on
or before December 31, 2006, the full amount of any such contested
liability is accrued or reserved for as a liability in the balance sheet of DCC
or FinCo, as applicable, for the period ending December 31, 2006, which
balance sheets are included in the Audited Company Financial Statements), (b) mechanics’,
carriers’, workers’, repairers’ and other similar liens arising or incurred in
the ordinary course of business relating to obligations as to which there is no
default on the part of the Company or any Company Subsidiary, or the Investor
or any Subsidiary of the Investor, as applicable, or the validity or amount of
which is being contested in good faith by appropriate proceedings, or pledges,
deposits or other liens securing the performance of bids, trade contracts,
leases or statutory

 

16

 

obligations (including
workers’ compensation, unemployment insurance or other social security
legislation), (c) zoning, entitlement, conservation restriction and other
land use and environmental regulations by one or more Governmental Authorities
which do not materially interfere with the present use of the assets of the
Company and the Company Subsidiaries, or of the Investor and its Subsidiaries,
as applicable, (d) all covenants, conditions, restrictions, easements,
encroachments, charges, rights-of-way, other liens and any similar matters of
record set forth in any state, local or municipal franchise on title to real
property of the Company and the Company Subsidiaries or the Investor and its
Subsidiaries, as applicable, which do not materially interfere with the present
use of such property, and (e) minor survey exceptions and matters as to
real property of the Company and the Company Subsidiaries or the Investor and
its Subsidiaries, as applicable, which would be disclosed by an accurate survey
or inspection of such real property and do not materially impair the occupancy
or current use of such real property.

 

“Person” means any
individual, partnership, firm, corporation, limited liability company,
association, trust, unincorporated organization or other entity, as well as any
syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Exchange Act.

 

“Procurement and Supply
Cooperation Agreement” means the Procurement and Supply Cooperation
Agreement to be executed by the Guarantor and the Company at the Closing, which
shall be consistent with the term sheet attached hereto as Exhibit R.

 

“Project X Restructuring”
means the internal restructuring of all or a portion of the Company Business
set forth on Schedule 1.01(i).

 

“Rating Agencies”
means Moody’s Investor Service, Inc., Standard & Poor’s, a
division of the McGraw-Hill Companies, Inc., and Fitch Ratings.

 

“Registered” means
issued by, registered with, renewed by or the subject of a pending application
before, any Governmental Authority or Internet domain name registrar.

 

“Regulations” means
the Treasury regulations promulgated under the Code, as in effect on the date
hereof.

 

“Reimbursed Amount”
means the aggregate amount reimbursed by the DC Contributors to DCC pursuant to
Sections 5.15(a) and (f).

 

“Release” means any
spilling, leaking, pumping, emitting, emptying, discharging, injecting,
escaping, leaching, migrating, dumping, or disposing of Hazardous Materials
(including the abandonment or discarding of barrels, containers or other closed
receptacles containing Hazardous Materials) into the environment.

 

“Remedial Action”
means (a) all actions taken to clean up, remove, remediate, contain,
treat, monitor, assess, evaluate, neutralize or in any other way address
Hazardous Materials in the indoor or outdoor environment; (b) all actions
taken to prevent or minimize a Release or threatened Release of Hazardous
Materials so such Hazardous Materials do not migrate or endanger or threaten to
endanger public health or welfare or the indoor or outdoor environment; or (c) all
actions taken to perform pre-remedial studies and investigations and
post-remedial operation and maintenance activities.

 

17

 

“Retained Intercompany
Debt” means Intercompany Indebtedness of DCC or its Subsidiaries with a
fair market value, on the Closing Date, equal to the sum of (a) the excess
of (A) the product of the Closing Date Cash Contribution, as adjusted
pursuant to Section 2.03(c), and a fraction the numerator of which is
19.9% and the denominator of which is 80.1% over (B) $400 million and (b) the
principal amount of the Subordinated Note.

 

“SEC” means the
Securities and Exchange Commission.

 

“Securities Act”
means the Securities Act of 1933, as amended.

 

“Securitization SPV”
means each Person that is a special purpose vehicle (whether a limited
liability company, corporation, trust or other entity) utilized in
Securitization Transactions involving assets of the Industrial Business or the
Financial Services Business.

 

“Securitization
Transaction” means any transaction sponsored by the Company or any Company
Subsidiary under which any such Person has sold or pledged receivables in a
securitization in which securities backed by, or other interests in, such receivables
were sold and any of such securities or other interests remain outstanding.

 

“Shrink-Wrap Agreements”
means “shrink-wrap” and “click-wrap” licenses and licenses concerning
mass-market generally commercially available software, in each case, which are
not material to the operation of the Company Business.

 

“Sprinter
Distribution Agreements” means the Sprinter Distribution Agreements, one of
which is to be executed by the Guarantor and DCC at the Closing and one of
which is to be executed by the Guarantor and DCCI at the Closing, which shall
be consistent with the term sheet attached hereto as Exhibit S.

 

“Straddle Period”
means any taxable period beginning on or before the Closing Date and ending
after the Closing Date.

 

“Subordinated Note”
means the promissory note issued by CarCo Intermediate HoldCo I LLC to DCNAF at
the Closing, which shall be consistent with the term sheet attached hereto as Exhibit T.

 

“Subsidiary” of any
Person means any corporation, partnership, limited liability company, or other
organization, whether incorporated or unincorporated, which is controlled by
such Person.

 

“Tax” or “Taxes”
means any and all taxes of any kind including any similar charges, levies or
other similar assessments or liabilities, including income, gross receipts, ad
valorem, premium, value-added, consumption, excise, real estate, real property,
personal property, sales, use, transfer, withholding, employment, unemployment
insurance, social security, business license, business organization,
environmental, workers compensation, profits, severance, stamp, occupation,
windfall profits, customs, duties, payroll, franchise taxes or other taxes
(together with any and all interest, penalties and additions to tax imposed
with respect thereto) imposed on or with respect to the Company or any Company
Subsidiaries, or any of

 

18

 

their respective assets, by
any Government Authority, or which are payable by the Company or any Company
Subsidiaries to any Government Authority.

 

“Tax Returns” means
any and all returns, reports and forms (including elections, declarations,
amendments, schedules, information returns or attachments thereto) required to
be filed with a Governmental Authority with respect to Taxes.

 

“Taxing Authority”
means any Governmental Authority responsible for the administration or
imposition of any Tax.

 

“Technology Sharing
Agreement” means the Technology Sharing Agreement to be executed by
Guarantor and DCC at the Closing, substantially in the form of Exhibit U.

 

“Trademark Agreement”
means the Trademark Agreement to be executed by Guarantor and DCC at the
Closing, substantially in the form of Exhibit V.

 

“ZEV Credits Sharing
Agreement” means the ZEV Credits Sharing Agreement to be executed by the
Guarantor and DCC at the Closing, which shall be consistent with the term sheet
attached hereto as Exhibit W.

 

SECTION 1.02.  Definitions.  The following terms have the meanings set
forth in the Sections set forth below:

 

	
  Definition

  	
   

  	
  Location

  
	
   

  	
   

  	
   

  
	
  “Accounting Principles”

  	
   

  	
  1.01

  
	
  “Acquisition Proposal”

  	
   

  	
  1.01

  
	
  “Acquisition Target”

  	
   

  	
  1.01

  
	
  “Action”

  	
   

  	
  1.01

  
	
  “Additional Cash Amount”

  	
   

  	
  1.01

  
	
  “Additional DCNAF
  Contribution”

  	
   

  	
  1.01

  
	
  “Adjusted Company Equity
  Award Holder Payment”

  	
   

  	
  6.07(a)

  
	
  “Affiliate”

  	
   

  	
  1.01

  
	
  “Affiliate Contract”

  	
   

  	
  5.09

  
	
  “Agreement”

  	
   

  	
  Preamble

  
	
  “Ancillary Agreements”

  	
   

  	
  1.01

  
	
  “Antitrust Laws”

  	
   

  	
  1.01

  
	
  “Auburn Hills Property”

  	
   

  	
  5.15(b)

  
	
  “Auburn Hills Trustee”

  	
   

  	
  5.15(b)

  
	
  “Audited 2006 SAP
  Statements”

  	
   

  	
  3.06(e)

  
	
  “Audited Company Financial
  Statements”

  	
   

  	
  3.06(a)

  
	
  “Business Day”

  	
   

  	
  1.01

  
	
  “Business Sale
  Transaction”

  	
   

  	
  1.01

  
	
  “CAFE Credits Sharing
  Agreement”

  	
   

  	
  1.01

  
	
  “Canada/Quebec Pension
  Plans”

  	
   

  	
  1.01

  
	
  “Canadian Transfer Pricing
  Dispute”

  	
   

  	
  1.01

  

 

19

 

	
  Definition

  	
   

  	
  Location

  
	
   

  	
   

  	
   

  
	
  “Canadian Transfer Pricing
  Provision”

  	
   

  	
  1.01

  
	
  “Cash/Debt Indemnification
  Amount”

  	
   

  	
  1.01

  
	
  “Cash/Debt Indemnification
  Statement”

  	
   

  	
  9.02(b)

  
	
  “Certificates”

  	
   

  	
  5.15(b)

  
	
  “CIC”

  	
   

  	
  5.05(c)

  
	
  “Closing”

  	
   

  	
  2.03(a)

  
	
  “Closing Date”

  	
   

  	
  2.03(a)

  
	
  “Closing Date Cash
  Contribution”

  	
   

  	
  1.01

  
	
  “Closing Price”

  	
   

  	
  1.01

  
	
  “Code”

  	
   

  	
  1.01

  
	
  “Collective Bargaining
  Agreement”

  	
   

  	
  1.01

  
	
  “Company”

  	
   

  	
  Recitals

  
	
  “Company Benefit Plans”

  	
   

  	
  1.01

  
	
  “Company Business”

  	
   

  	
  Recitals

  
	
  “Company Contracts”

  	
   

  	
  3.17(b)

  
	
  “Company Credit Support
  Instruments”

  	
   

  	
  5.08(c)

  
	
  “Company Employees”

  	
   

  	
  1.01

  
	
  “Company Equity Award
  Holder”

  	
   

  	
  1.01

  
	
  “Company Equity Award
  Holder Payments”

  	
   

  	
  1.01

  
	
  “Company Equity Award
  Holder Payments Statement”

  	
   

  	
  6.07(b)

  
	
  “Company Equity Interests”

  	
   

  	
  Recitals

  
	
  “Company Financial
  Statements”

  	
   

  	
  3.06(a)

  
	
  “Company Intellectual
  Property”

  	
   

  	
  1.01

  
	
  “Company IP Agreements”

  	
   

  	
  1.01

  
	
  “Company IT Agreements”

  	
   

  	
  1.01

  
	
  “Company IT Systems”

  	
   

  	
  1.01

  
	
  “Company Leased Real
  Property”

  	
   

  	
  1.01

  
	
  “Company Licensed
  Intellectual Property”

  	
   

  	
  1.01

  
	
  “Company Material Adverse
  Effect”

  	
   

  	
  1.01

  
	
  “Company Owned
  Intellectual Property”

  	
   

  	
  1.01

  
	
  “Company Owned Real
  Property”

  	
   

  	
  1.01

  
	
  “Company Real Property”

  	
   

  	
  1.01

  
	
  “Company Subsidiary”

  	
   

  	
  1.01

  
	
  “Computer Software”

  	
   

  	
  1.01

  
	
  “Confidentiality
  Agreement”

  	
   

  	
  5.03(a)

  
	
  “Contest”

  	
   

  	
  7.03(b)

  
	
  “Contingent Obligation”

  	
   

  	
  1.01

  
	
  “Contracts”

  	
   

  	
  1.01

  
	
  “control”

  	
   

  	
  1.01

  
	
  “Conveyance Taxes”

  	
   

  	
  1.01

  
	
  “Cooperation Agreement for
  Project ‘Adaptation Work for Diesel Engines/Control Systems’”

  	
   

  	
  1.01

  
	
  “Cooperation Agreement for
  Project ‘Common Axle’”

  	
   

  	
  1.01

  

 

20

 

	
  Definition

  	
   

  	
  Location

  
	
   

  	
   

  	
   

  
	
  “Cooperation Agreement for
  Project ‘Common Unibody SUV’”

  	
   

  	
  1.01

  
	
  “Cooperation Agreement for
  Project ‘Common V6’”

  	
   

  	
  1.01

  
	
  “Cooperation Agreement for
  Project ‘Fuel Cell Vehicle’”

  	
   

  	
  1.01

  
	
  “DC Contributors”

  	
   

  	
  Preamble

  
	
  “DC Contributors Credit
  Support Instruments”

  	
   

  	
  5.08(a)

  
	
  “DC Contributors
  Disclosure Schedule”

  	
   

  	
  1.01

  
	
  “DC Contributors
  Indemnified Party”

  	
   

  	
  9.03(a)

  
	
  “DC Contributors
  Intellectual Property”

  	
   

  	
  1.01

  
	
  “DC Contributors Material
  Adverse Effect”

  	
   

  	
  1.01

  
	
  “DC Contributors’
  Knowledge”

  	
   

  	
  1.01

  
	
  “DCC”

  	
   

  	
  Recitals

  
	
  “DCC Insurance Policy”

  	
   

  	
  3.25

  
	
  “DCC/Guarantor Transition
  Services Agreement”

  	
   

  	
  1.01

  
	
  “DCMH”

  	
   

  	
  1.01

  
	
  “DC Holding”

  	
   

  	
  Preamble

  
	
  “DCNAF”

  	
   

  	
  Preamble

  
	
  “DCNAF Contribution”

  	
   

  	
  1.01

  
	
  “Debenture Indenture”

  	
   

  	
  5.15(a)

  
	
  “Debentures”

  	
   

  	
  5.15(a)

  
	
  “2027 Debentures”

  	
   

  	
  5.15(a)

  
	
  “7.40% 2097 Debentures”

  	
   

  	
  5.15(a)

  
	
  “7.45% 2097 Debentures”

  	
   

  	
  5.15(a)

  
	
  “Debt Financing”

  	
   

  	
  4.05(b)

  
	
  “Debt Financing
  Commitments”

  	
   

  	
  4.05(b)

  
	
  “Debt Offer”

  	
   

  	
  5.15(c)

  
	
  “Delayed Closing”

  	
   

  	
  2.06(b)

  
	
  “Delayed Closing Date”

  	
   

  	
  2.06(c)

  
	
  “Delayed Closing Entities”

  	
   

  	
  2.06(a)

  
	
  “Derivative Transactions”

  	
   

  	
  1.01

  
	
  “Electronic Data Room”

  	
   

  	
  1.01

  
	
  “Eligible Distributions”

  	
   

  	
  1.01

  
	
  “Encumbrance”

  	
   

  	
  1.01

  
	
  “Entity Cash Amount”

  	
   

  	
  1.01

  
	
  “Entity Cash
  Indemnification Amount”

  	
   

  	
  1.01

  
	
  “Entity Debt Amount”

  	
   

  	
  1.01

  
	
  “Entity Debt
  Indemnification Amount”

  	
   

  	
  1.01

  
	
  “Environmental Claim”

  	
   

  	
  1.01

  
	
  “Environmental Law”

  	
   

  	
  1.01

  
	
  “Environmental
  Liabilities”

  	
   

  	
  1.01

  
	
  “Environmental Lien”

  	
   

  	
  1.01

  
	
  “Environmental Permit”

  	
   

  	
  1.01

  
	
  “Equity Financing”

  	
   

  	
  4.05(b)

  

 

21

 

	
  Definition

  	
   

  	
  Location

  
	
   

  	
   

  	
   

  
	
  “Equity Financing
  Commitment”

  	
   

  	
  4.05(b)

  
	
  “Equity Interests”

  	
   

  	
  1.01

  
	
  “ERISA”

  	
   

  	
  1.01

  
	
  “Estimated Company Equity
  Award Holder Payments”

  	
   

  	
  6.07(b)

  
	
  “Estimated Headquarters
  Reimbursement Amount”

  	
   

  	
  5.16(d)

  
	
  “Excepted Refund”

  	
   

  	
  7.02(a)

  
	
  “Exchange”

  	
   

  	
  5.15(b)

  
	
  “Exchange Act”

  	
   

  	
  1.01

  
	
  “Exchange Debentures”

  	
   

  	
  5.15(b)

  
	
  “Exchange Notice”

  	
   

  	
  5.15(b)

  
	
  “Excluded Taxes”

  	
   

  	
  1.01

  
	
  “FCPA”

  	
   

  	
  3.24

  
	
  “Filed SEC Documents”

  	
   

  	
  3.06(c)

  
	
  “Final Reimbursement
  Amount”

  	
   

  	
  1.01

  
	
  “Finance Agreements”

  	
   

  	
  1.01

  
	
  “Financial Services
  Business”

  	
   

  	
  1.01

  
	
  “Financial Services Business
  Carve-Out Basis”

  	
   

  	
  3.06(a)

  
	
  “Financial Services
  Companies”

  	
   

  	
  3.06(a)

  
	
  “Financing”

  	
   

  	
  5.10

  
	
  “Financing Commitments”

  	
   

  	
  4.05(b)

  
	
  “FinCo”

  	
   

  	
  Recitals

  
	
  “FinCo/DCFS USA Transition
  Services Agreement”

  	
   

  	
  1.01

  
	
  “FinCo/Guarantor
  Transition Services Agreement”

  	
   

  	
  1.01

  
	
  “Foreign Benefit Plan”

  	
   

  	
  3.14(g)

  
	
  “Fuel Cell Amount”

  	
   

  	
  5.16(f)

  
	
  “Fuel Cell R&D
  Agreement”

  	
   

  	
  1.01

  
	
  “Fundamental Documents”

  	
   

  	
  1.01

  
	
  “Funded Indebtedness”

  	
   

  	
  1.01

  
	
  “Future Business Model in
  China and South Korea Agreements”

  	
   

  	
  1.01

  
	
  “GAAP”

  	
   

  	
  1.01

  
	
  “Governmental Authority”

  	
   

  	
  1.01

  
	
  “Governmental Order”

  	
   

  	
  1.01

  
	
  “Guarantor”

  	
   

  	
  Preamble

  
	
  “Guarantor Material
  Adverse Effect”

  	
   

  	
  1.01

  
	
  “Hazardous Material”

  	
   

  	
  1.01

  
	
  “Headquarters Costs
  Statement”

  	
   

  	
  2.07

  
	
  “Headquarters
  Reimbursement Amount”

  	
   

  	
  1.01

  
	
  “HSR Act”

  	
   

  	
  1.01

  
	
  “Indebtedness”

  	
   

  	
  1.01

  
	
  “Indemnified Party”

  	
   

  	
  1.01

  
	
  “Indemnifying Party”

  	
   

  	
  1.01

  
	
  “Independent Accounting
  Firm”

  	
   

  	
  9.02(b)

  
	
  “Industrial Business”

  	
   

  	
  1.01

  

 

22

 

	
  Definition

  	
   

  	
  Location

  
	
   

  	
   

  	
   

  
	
  “Industrial Business
  Carve-Out Basis”

  	
   

  	
  3.06(a)

  
	
  “Industrial Companies”

  	
   

  	
  3.06(a)

  
	
  “Information”

  	
   

  	
  5.03(c)

  
	
  “Initial Public Offering”

  	
   

  	
  1.01

  
	
  “Insurance Agency”

  	
   

  	
  1.01

  
	
  “Insurance Contracts”

  	
   

  	
  1.01

  
	
  “Insurance Regulator”

  	
   

  	
  3.06(e)

  
	
  “Insurance Representative”

  	
   

  	
  3.26(c)

  
	
  “Insurance Subsidiary”

  	
   

  	
  1.01

  
	
  “Intellectual Property”

  	
   

  	
  1.01

  
	
  “Intercompany Contract”

  	
   

  	
  1.01

  
	
  “Intercompany
  Indebtedness”

  	
   

  	
  1.01

  
	
  “Intercompany Receivable”

  	
   

  	
  1.01

  
	
  “International
  Distribution Agreement”

  	
   

  	
  1.01

  
	
  “International Financial
  Services Cooperation Agreement”

  	
   

  	
  1.01

  
	
  “Investor”

  	
   

  	
  Preamble

  
	
  “Investor Disclosure
  Schedule”

  	
   

  	
  1.01

  
	
  “Investor Equity
  Interests”

  	
   

  	
  1.01

  
	
  “Investor Group”

  	
   

  	
  5.12

  
	
  “Investor Indemnified
  Party”

  	
   

  	
  9.02(a)

  
	
  “Investor Material Adverse
  Effect”

  	
   

  	
  1.01

  
	
  “Investor’s Knowledge”

  	
   

  	
  1.01

  
	
  “IRS”

  	
   

  	
  1.01

  
	
  “ITM Cooperation
  Agreement”

  	
   

  	
  1.01

  
	
  “IT Systems”

  	
   

  	
  1.01

  
	
  “Law”

  	
   

  	
  1.01

  
	
  “Leased Portfolio”

  	
   

  	
  1.01

  
	
  “Leases”

  	
   

  	
  3.13(b)

  
	
  “Liabilities”

  	
   

  	
  1.01

  
	
  “Licensed Transferred
  Intellectual Property”

  	
   

  	
  1.01

  
	
  “Like-Kind Exchange
  Program”

  	
   

  	
  1.01

  
	
  “LLC Operating Agreement”

  	
   

  	
  1.01

  
	
  “Loss”

  	
   

  	
  9.02(a)

  
	
  “Master ER&D
  Agreement”

  	
   

  	
  1.01

  
	
  “Mezzanine LLC”

  	
   

  	
  4.08(a)

  
	
  “Multiemployer Plan”

  	
   

  	
  3.14(e)

  
	
  “Nasdaq”

  	
   

  	
  1.01

  
	
  “New Debt Financing
  Commitments”

  	
   

  	
  4.05(b)

  
	
  “Non Cash Proceeds”

  	
   

  	
  5.12(a)

  
	
  “NYSE”

  	
   

  	
  1.01

  
	
  “Offer Documents

  	
   

  	
  5.15(c)

  
	
  “Omitted Assets”

  	
   

  	
  5.13(a)

  
	
  “Omitted Services”

  	
   

  	
  5.13(b)

  

 

23

 

	
  Definition

  	
   

  	
  Location

  
	
   

  	
   

  	
   

  
	
  “Orphan Subsidiaries”

  	
   

  	
  3.06(f)

  
	
  “Other Retained
  Intercompany Debt”

  	
   

  	
  1.01

  
	
  “Owner LLC”

  	
   

  	
  2.03(b)

  
	
  “Parent Equity Plans”

  	
   

  	
  6.07(a)

  
	
  “Partial Realization
  Transaction”

  	
   

  	
  1.01

  
	
  “Parts Distribution Centers
  Agreement”

  	
   

  	
  1.01

  
	
  “PBGC”

  	
   

  	
  3.14(a)

  
	
  “Per Unit Value Invested”

  	
   

  	
  1.01

  
	
  “Permits”

  	
   

  	
  1.01

  
	
  “Permitted Encumbrances”

  	
   

  	
  1.01

  
	
  “Person”

  	
   

  	
  1.01

  
	
  “Post-Closing
  Restructuring Transactions”

  	
   

  	
  5.05(b)

  
	
  “Post-Closing Tax Return”

  	
   

  	
  7.04(b)

  
	
  “Pre-Closing Restructuring
  Transactions”

  	
   

  	
  5.05(a)

  
	
  “Procurement and Supply
  Cooperation Agreement”

  	
   

  	
  1.01

  
	
  “Project X Restructuring”

  	
   

  	
  1.01

  
	
  “Proposing Party”

  	
   

  	
  7.03(c)

  
	
  “Quarterly SAP Statements”

  	
   

  	
  3.06(e)

  
	
  “Rating Agencies”

  	
   

  	
  1.01

  
	
  “Redemption”

  	
   

  	
  5.15(a)

  
	
  “Redemption Notice”

  	
   

  	
  5.15(a)

  
	
  “Redemption Payment”

  	
   

  	
  5.15(a)

  
	
  “Registered”

  	
   

  	
  1.01

  
	
  “Regulations”

  	
   

  	
  1.01

  
	
  “Reimbursed Amount”

  	
   

  	
  1.01

  
	
  “Release”

  	
   

  	
  1.01

  
	
  “Remedial Action”

  	
   

  	
  1.01

  
	
  “Repaid Intercompany Debt”

  	
   

  	
  2.03(b)

  
	
  “Representatives”

  	
   

  	
  11.10(e)

  
	
  “Retained Intercompany
  Debt”

  	
   

  	
  1.01

  
	
  “Reviewing Accounting
  Firm”

  	
   

  	
  3.06(b)

  
	
  “SAP”

  	
   

  	
  3.06(e)

  
	
  “SAS 100”

  	
   

  	
  3.06(b)

  
	
  “SEC”

  	
   

  	
  1.01

  
	
  “Securities Act”

  	
   

  	
  1.01

  
	
  “Securitization
  Instruments”

  	
   

  	
  3.19(a)

  
	
  “Securitization Servicer”

  	
   

  	
  3.19(a)

  
	
  “Securitization SPV”

  	
   

  	
  1.01

  
	
  “Securitization
  Transaction”

  	
   

  	
  1.01

  
	
  “Shrink-Wrap Agreements”

  	
   

  	
  1.01

  
	
  “Signing DC Contributors
  Affiliate”

  	
   

  	
  3.01

  
	
  “Sprinter Distribution
  Agreements”

  	
   

  	
  1.01

  
	
  “Stand-Alone Books”

  	
   

  	
  5.17

  
	
  “Stand-Alone Financial
  Statements”

  	
   

  	
  5.17

  

 

24

 

	
  Definition

  	
   

  	
  Location

  
	
   

  	
   

  	
   

  
	
  “Straddle Period”

  	
   

  	
  1.01

  
	
  “Subordinated Note”

  	
   

  	
  1.01

  
	
  “Subsidiary”

  	
   

  	
  1.01

  
	
  “Supplemental Financial
  Reports”

  	
   

  	
  5.02(e)

  
	
  “Tax”

  	
   

  	
  1.01

  
	
  “Tax Returns”

  	
   

  	
  1.01

  
	
  “Taxing Authority”

  	
   

  	
  1.01

  
	
  “Technology Sharing
  Agreement”

  	
   

  	
  1.01

  
	
  “Third Party Claim”

  	
   

  	
  9.05(b)

  
	
  “Trademark Agreement”

  	
   

  	
  1.01

  
	
  “Trust Agreement”

  	
   

  	
  5.15(b)

  
	
  “Unaudited Company
  Financial Statements”

  	
   

  	
  3.06(a)

  
	
  “Unaudited 2007 Company
  Financial Statements”

  	
   

  	
  5.02(h)

  
	
  “Unaudited 2007 Financial
  Services Companies Financial Statements”

  	
   

  	
  5.02(h)

  
	
  “Utility Assets”

  	
   

  	
  5.02(f)

  
	
  “ZEV Credits Sharing
  Agreement”

  	
   

  	
  1.01

  

 

SECTION 1.03.  Interpretation and Rules of
Construction.  In this Agreement,
except to the extent otherwise provided or that the context otherwise requires:

 

(a)           when a reference is made in this
Agreement to an Article, Section, Exhibit or Schedule, such reference is
to an Article or Section of, or an Exhibit or Schedule to, this
Agreement unless otherwise indicated;

 

(b)           the table of contents and the
headings in this Agreement are for reference purposes only and do not affect in
any way the meaning or interpretation of this Agreement;

 

(c)           whenever the words “include,” “includes”
or “including” are used in this Agreement, they are deemed to be followed by
the words “without limitation”;

 

(d)           the words “hereof,” “herein” and “hereunder”
and words of similar import, when used in this Agreement, refer to this
Agreement as a whole and not to any particular provision of this Agreement;

 

(e)           all terms defined in this Agreement
have the defined meanings when used in any certificate or other document made
or delivered pursuant hereto, unless otherwise defined therein;

 

(f)            the definitions contained in this
Agreement are applicable to the singular as well as the plural forms of such
terms;

 

(g)           references to a Person are also to
its successors and permitted assigns; and

 

25

 

(h)           the
use of “or” is not intended to be exclusive unless expressly indicated
otherwise.

 

ARTICLE II

 

CONTRIBUTIONS

 

SECTION 2.01.  Contributions to the Company.  Subject to the terms and conditions of this
Agreement, at the Closing, (a) DCNAF shall contribute to the Company the
Retained Intercompany Debt in exchange for Company Equity Interests; and (b) the
Investor shall transfer to the Company the Closing Date Cash Contribution in
exchange for the Investor Equity Interests.

 

SECTION 2.02.  Distributions.  Subject to the terms and conditions of this
Agreement, at the Closing, the Investor and the DC Contributors, in their
respective capacities as holders of Company Equity Interests, shall cause the
Company to distribute to DC Holding an amount in cash equal the Final
Reimbursement Amount.  The parties agree
that the distribution by the Company pursuant to the foregoing sentence of the
amount referred to therein shall reimburse DC Holding for preformation expenses
as described in Section 1.707-4(d) of the Regulations.

 

SECTION 2.03.  Closing.  (a)  Subject to the terms and conditions
of this Agreement, the transfers described in Section 2.01 (and, subject
to Section 2.06, the other transactions contemplated by this Agreement to
occur at such time) shall take place at a closing (the “Closing”) to be
held at the offices of Shearman & Sterling LLP, 599 Lexington Avenue,
New York, New York at 10:00 a.m. New York time on the fifth Business Day
following the satisfaction or waiver (in accordance with this Agreement) of the
conditions to the obligations of the parties hereto set forth in Section 8.01
and Section 8.02 (other than those conditions that by their nature are to
be satisfied at the Closing), or at such other place or at such other time or
on such other date as the DC Contributors and the Investor may mutually agree
upon in writing (the “Closing Date”). 
Subject to Section 2.06, all of the transactions set forth in Section 2.04
and Section 2.05 will be considered to have taken place simultaneously on
the Closing Date, and no delivery or payment will be considered to have been
made until all steps taken at the Closing shall have been completed.

 

(b)           At
the Closing,

 

(i)            the Investor shall pay the Closing Date
Cash Contribution by wire transfer of immediately available funds to an account
of the Company designated no later than three Business Days prior to the
Closing Date by DC Holding;

 

(ii)           subject to the receipt of the Closing Date
Cash Contribution from the Investor, the Investor and the DC Contributors, in
their respective capacities as holders of Company Equity Interests, shall cause
the Company to (A) first, contribute to the capital of DCC cash in
an amount equal to $3.45 billion (as adjusted pursuant to clause (C) below),
(B) second, contribute to the capital of FinCo cash in an amount
equal to $2.275 billion and (C) third, contribute to the

 

26

 

capital of
Auburn Hills Owner LLC (“Owner LLC”), its indirect subsidiary, cash in
an amount equal to $105 million (or such greater amount as may be necessary to
result in Owner LLC having an aggregate of $325 million in cash available for
the purchase of the HQ Facility from DCC (after giving effect to Owner LLC’s
purchase money financing with respect thereto), with any excess over $105
million reducing the amount set forth in clause (A) above;

 

(iii)          as consideration for the purchase of the HQ
Facility, Owner LLC shall pay DCC cash in an amount equal to $325 million;

 

(iv)          DCNAF shall transfer to the Company (A) the
Retained Intercompany Debt (except for the Other Retained Intercompany Debt), (B) cash
in an amount equal to the Additional DCNAF Contribution, and (C) cash in
an amount equal to the Estimated Headquarters Reimbursement Amount;

 

(v)           subject to the receipt by the Company of the
Closing Date Cash Contribution from the Investor, the DC Contributors shall
cause the Company to issue to the Investor the Investor Equity Interests such
that the Investor will own, immediately after the Closing, 80.1% of the Company
Equity Interests;

 

(vi)          subject to the receipt by the Company of the
DCNAF Contribution from DCNAF, the DC Contributors together with the Investor
shall cause the Company to issue to DCNAF Company Equity Interests such that
the DC Contributors together will own, immediately after the Closing, 19.9% of
the Company Equity Interests;

 

(vii)         as consideration for the Other Retained
Intercompany Debt transferred by DCNAF to CarCo Intermediate HoldCo I LLC, the
Subordinated Note shall be issued by CarCo Intermediate HoldCo I LLC to DCNAF;

 

(viii)        FinCo shall pay Indebtedness in the amount of
$1.225 billion plus accrued but unpaid interest thereon owed by it to DCC; and

 

(ix)           DCC shall repay to the DC Contributors or
their Affiliates, as applicable, the portion of the Intercompany Indebtedness
equal to the aggregate amount borrowed by DCC and its Subsidiaries from the DC
Contributors and their Affiliates (other than the Company or Company
Subsidiaries) in accordance with Section 5.19(b) during the period
from July 1, 2007 to the Closing Date and still outstanding immediately
prior to the Closing plus accrued and unpaid interest thereon, provided that (A) the
amount of such repayment in respect of borrowings made between July 1,
2007 and July 31, 2007 shall not exceed $850 million, plus accrued and
unpaid interest thereon (calculated based on 1 month LIBOR plus 65 basis
points), (B) the amount of such repayment in respect of borrowings made
after July 31, 2007 and prior to August 3, 2007 shall not exceed
$1.15 billion, plus accrued and unpaid interest thereon (calculated based on 1
month LIBOR plus 65 basis points), and (C) the aggregate amount of such
repayment shall not exceed the Additional Cash Amount plus accrued and unpaid
interest thereon

 

27

 

(calculated
based on 1 month LIBOR plus 65 basis points) (the “Repaid Intercompany Debt”).

 

(c)           Notwithstanding
anything in this Agreement to the contrary, (i) to the extent that the
Investor is entitled to indemnification pursuant to a final determination that
has been made pursuant to Section 9.02(b) hereof on or prior to the
Closing Date, the Closing Date Cash Contribution shall automatically be reduced
and the Additional DCNAF Contribution shall be automatically increased by the
amount of such indemnification; (ii) in the event the statutory book value
of the Insurance Subsidiary set forth in the Audited 2006 SAP Statements is
less than $162.7 million, then the Closing Date Cash Contribution shall be
automatically reduced and the Additional DCNAF Contribution shall be
automatically increased by the amount of such shortfall x 1.35 x .801; (iii) in
the event that the pre-tax earnings of the Financial Services Companies set
forth in the Unaudited 2007 Financial Services Companies Financial Statements
are less than $250 million, the Closing Date Cash Contribution shall be
automatically reduced and the Additional DCNAF Contribution shall be
automatically increased by the amount of such shortfall; and (iv) in the
event that DCC shall immediately prior to the Closing not have good and
marketable fee simple absolute title to the Auburn Hills Property, free and
clear of all Encumbrances, except Permitted Encumbrances, then the amount of
the Additional DCNAF Contribution shall be automatically increased by $220
million, and such amount shall instead be distributed to DCNAF subsequent to
the Closing at such time as DCC obtains such title.

 

SECTION 2.04.  Closing Deliveries by the DC Contributors.  At the Closing, the DC Contributors shall
deliver or cause to be delivered:

 

(a)           to
the Company, instruments of transfer and conveyance, in form and substance
reasonably satisfactory to the Investor, evidencing and effecting the transfer
of the DCNAF Contribution;

 

(b)           to
the Investor, subject to the receipt by the Company of the Closing Date Cash
Contribution from the Investor,

 

(i)            evidence of the issuance of the Investor
Equity Interests by the Company to the Investor;

 

(ii)           counterparts
of each Ancillary Agreement to which a DC Contributor or an Affiliate of either
of the DC Contributors is a party executed by such DC Contributor, or such
Affiliate, as the case may be;

 

(iii)          a
certificate of a duly authorized officer of each of the DC Contributors
certifying as to the matters set forth in Sections 8.02(a) and (d);

 

(iv)          any
other documents or instruments reasonably required by the Investor to
consummate the transactions contemplated hereby; and

 

(v)           a certificate of an appropriate officer of
DCC certifying as to the solvency of DCC, after giving effect to the
recapitalization of DCC effected in connection with the Closing.

 

28

 

(c)           to
DCNAF, subject to the receipt by the Company of the DCNAF Contribution,
evidence of the issuance of the Company Equity Interests acquired by DCNAF
pursuant to clause 2.03(b)(v).

 

SECTION 2.05.  Closing Deliveries by the Investor.  At the Closing, the Investor shall deliver:

 

(a)           to
the Company, the Closing Date Cash Contribution; and

 

(b)           to
DC Holding,

 

(i)            counterparts of each Ancillary Agreement to
which the Investor or an Affiliate of the Investor is a party (if any) executed
by the Investor or such Affiliate; and

 

(ii)           a certificate of a duly authorized officer
of the Investor certifying as to the matters set forth in Sections 8.01(a) and
(d); and

 

(c)           any
other documents or instruments reasonably required by DC Holding to consummate
the transactions contemplated hereby.

 

SECTION 2.06.  Delayed Closing.  (a) Notwithstanding anything to the contrary
contained in this Agreement, in the event that the conditions set forth in Article VIII
have been satisfied (except that any approval or Permit of any Governmental
Authority relating to the Insurance Subsidiary or the Insurance Agency that is
required in connection with the Closing has not then been received or obtained
or any applicable waiting period has not yet expired (such entities,
collectively, the “Delayed Closing Entities”)), either the DC
Contributors or the Investor shall have the right to require the Closing to
occur other than with respect to such Delayed Closing Entities, which Closing
shall be effected as contemplated hereby, subject to subsections (b), (c) and
(e) below.  (The date of such
Closing, being, for the avoidance of doubt, the Closing Date hereunder).

 

(b)           In
the event that either the DC Contributors or the Investor exercises its right
to require the Closing to occur other than with respect to the Delayed Closing
Entities pursuant to subsection (a) above, then the Delayed Closing
Entities shall not be included as a Subsidiary of the Company at the Closing as
part of the DC Holding Contribution and there shall be a subsequent closing
with respect to the Delayed Closing Entities (the “Delayed Closing”).

 

(c)           The
Delayed Closing shall occur on the later of the third Business Day (the “Delayed
Closing Date”) following receipt of the applicable approvals of any
Governmental Authority and the expiration of any applicable waiting period with
respect to such Delayed Closing Entities, at the offices of Shearman &
Sterling LLP, 599 Lexington Avenue, New York, New York at 10:00 a.m. New
York or at such other place or at such other time or on such other date as the
DC Contributors and the Investor may mutually agree upon in writing.  At the Delayed Closing, the DC Contributors
shall make such deliveries as may be reasonably necessary to transfer all of
the Equity Interests in the Delayed Closing Entities to the Company as
contemplated by Section 2.04.

 

29

 

(d)           From
the Closing Date to the Delayed Closing Date, the DC Contributors shall, with
any necessary cooperation from the Investor, (i) take such actions with
respect to the Delayed Closing Entities as may be reasonably requested by the
Investor to the extent permitted by applicable Law, and (ii) (A) preserve
each Delayed Closing Entity, and (B) hold and operate each Delayed Closing
Entity in trust for the account of the Company. 
At the Delayed Closing, the Company shall be entitled to the economic
benefit of each Delayed Closing Entity, subject to the economic burden
thereof.  Subject to Section 2.06(f),
to the extent that either of the DC Contributors is not lawfully able to hold
and operate any Delayed Closing Entities in trust for the account of the
Company as contemplated by the preceding sentence, such DC Contributor shall
use its commercially reasonable efforts to enter into an arrangement that
passes on to the Company the economic costs, economic burdens and economic
benefits of ownership of such Delayed Closing Entities.  The foregoing shall be undertaken pursuant to
documentation to be mutually agreed upon by the DC Contributors and the
Investor.

 

(e)           Notwithstanding
anything contained herein to the contrary, the conditions relating to the
Insurance Agency and the Insurance Subsidiary set forth on Schedule 8.01 shall
be the only conditions required to be satisfied or waived by either the DC
Contributors or the Investor prior to a Delayed Closing in order to consummate
the transactions contemplated by this Section 2.06 with respect to any
Delayed Closing Entities.  In respect of
the Delayed Closing Entities, from the Closing Date to the Delayed Closing
Date, the DC Contributors and the Investor shall continue to comply with all
covenants and agreements contained in this Agreement that are required by their
terms to be performed prior to the Closing solely in respect of the Delayed
Closing Entities and, unless the context clearly requires otherwise and except
for purposes of Article VII hereof, all references in this Agreement to
the “Closing” or the “Closing Date” shall, with respect to the Delayed Closing
Entities, be deemed to refer to the Delayed Closing or the Delayed Closing
Date, respectively.

 

(f)            In
the event the Closing occurs but thereafter the Delayed Closing does not occur
on or prior to the one-year anniversary of the date of this Agreement, (i) the
DC Contributors shall pay to the Investor on such one-year anniversary date by
wire transfer of immediately available funds to an account designated by the
Investor an amount equal to $176 million (reduced by any amount calculated in
accordance with Section 2.03(c)(ii)), plus interest from the Closing Date
through the date of payment at the rate of interest publicly announced by JP
Morgan Chase Bank or any successor thereto in New York, New York from time to
time as its reference rate from the Closing Date to the date of such payment, (ii) the
parties shall terminate any arrangements entered into pursuant to Section 2.06(d) and
all obligations of the parties pursuant to this Section 2.06 shall terminate
except as set forth in this Section 2.06(f) and (iii) (A) the
benefits and burdens associated with the operation of the Delayed Closing
Entities held in trust for the account of the Company pursuant to Section 2.06(d)(ii)(B) shall
be retained by the DC Contributors, (B) any economic benefit or any
economic burden that shall have been transferred to the Company pursuant to Section 2.06(d) shall
be transferred to the DC Contributors, including the discharge of any
liabilities or obligations relating to the Delayed Closing Entities, and the DC
Contributors shall be liable for such liabilities and obligations; provided
that the transfer of such economic benefits and economic burdens shall be net
of any costs associated with the transfer of such economic benefit or economic
burden to the Company pursuant to Section 2.06(d) that were paid by
the Company after the Closing Date and (C) the parties shall, to the
extent lawful and practicable, use their

 

30

 

reasonable
best efforts to cause the Company to enter into arrangements to return any of
the economic costs, economic burdens and economic benefits of ownership of the
Delayed Closing Entities that had been transferred to the Company after the
Closing Date pursuant to the penultimate sentence of Section 2.06(d).  In the event that the payment contemplated by
the first sentence of this Section 2.06(f) is not made when due, the
Company shall have the right, exercisable in its sole discretion, to offset the
amount thereof, to the extent not paid, against amounts owed by the Company and
the Company Subsidiaries to the DC Contributors or their respective Affiliates
(other than the Company and the Company Subsidiaries), in their capacities as
holders of Company Equity Interests, and to pay such amount to the Investor,
provided that any claims of the DC Contributors against the Investor hereunder
for the failure of the Delayed Closing to occur on or prior to the one-year
anniversary of the date of this Agreement having been caused by the Investor’s
breach of its obligations hereunder shall survive the foregoing.

 

SECTION 2.07.  Adjustment. (a) Within 60 days
after the Closing Date, the DC Contributors shall deliver to the Investor a statement,
which shall have been prepared by the DC Contributors, setting forth the
Headquarters Reimbursement Amount (the “Headquarters Costs Statement”).  If the Investor does not give written notice
of its disagreement with the Headquarters Costs Statement within 30 days of its
receipt of the Headquarters Costs Statement, then such statement shall be
considered final, binding and conclusive upon the Investor and the DC
Contributors.  If the Investor disputes
any portion of the Headquarters Costs Statement, the dispute resolution
procedures set forth in Section 9.02(b)(iii) shall apply mutatis
mutandis with respect to such dispute.

 

(b)           If the final
Headquarters Reimbursement Amount exceeds the Estimated Headquarters
Reimbursement Amount, the DC Contributors shall pay an amount equal to such
excess to an account designated by the Company by wire transfer of immediately
available funds within five Business Days of the final determination of the
Headquarters Reimbursement Amount. If the Estimated Headquarters Reimbursement
Amount exceeds the final Headquarters Reimbursement Amount, the parties shall
cause the Company and its Subsidiaries to pay an amount equal to such excess to
an account designated by the DC Contributors by wire transfer of immediately
available funds within five Business Days of the final determination of the
Headquarters Reimbursement Amount.

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES

OF THE DC CONTRIBUTORS

 

The DC
Contributors hereby represent and warrant, jointly and severally, to the Investor,
as of the date hereof or, if a representation or warranty is made as of a
specified date, as of such date, as follows:

 

SECTION 3.01.  Organization, Authority and Qualification
of the DC Contributors.  Each of the
DC Contributors is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and is an indirect wholly
owned subsidiary of the Guarantor.  Each
of the DC Contributors has all necessary corporate power and authority to enter
into this Agreement and the Ancillary Agreements to which it is a party, to

 

31

 

carry out its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby.  Subject
to the receipt of the approval of the Supervisory Board of the Guarantor, each
Affiliate of either of the DC Contributors that is or will be a party to an
Ancillary Agreement (a “Signing DC Contributors Affiliate”) has or will
have prior to the Closing all necessary power and authority to enter into the
Ancillary Agreements to which it is a party, to carry out its obligations
thereunder and to consummate the transactions contemplated thereby.  Each of the DC Contributors and the Signing
DC Contributors Affiliates is duly licensed or qualified to do business and is
in good standing (if such concept is applicable) in each jurisdiction in which
the properties owned or leased by it or the operation of its business makes
such licensing or qualification necessary, except to the extent that such
failures to be so licensed, qualified or in good standing would not,
individually or in the aggregate, have a DC Contributors Material Adverse
Effect.  The execution and delivery by
the DC Contributors of this Agreement and the Ancillary Agreements to which
such DC Contributor is or will be a party, the performance by such DC
Contributor of its obligations hereunder and thereunder and the consummation by
such DC Contributor of the transactions contemplated hereby and thereby have
been duly authorized by all requisite corporate action on the part of such DC
Contributor and its stockholders. 
Subject to the receipt of the approval of the Supervisory Board of the
Guarantor, the execution and delivery by each of the Company, the Company
Subsidiaries and the Signing DC Contributors Affiliates of the Ancillary
Agreements to which it is or will be a party, the performance by each of the
Company, the Company Subsidiaries and the Signing DC Contributors Affiliates of
the Ancillary Agreements to which it is or will be a party, and the
consummation by each of the Company, the Company Subsidiaries and the Signing
DC Contributors Affiliates of the transactions contemplated by the Ancillary
Agreements to which it is or will be a party, have been or will be prior to the
Closing duly authorized by all requisite action on its part and the part of its
equity holders.  This Agreement has been
duly executed and delivered by the DC Contributors and (assuming due
authorization, execution and delivery by the Investor) constitutes a legal,
valid and binding obligation of the DC Contributors, enforceable against each
of the DC Contributors in accordance with its terms, subject to the effect of
any applicable bankruptcy, insolvency (including all Laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting creditors’
rights generally and subject to the effect of general principles of equity
(regardless of whether considered in a proceeding at law or in equity).  Subject to the receipt of the approval of the
Supervisory Board of the Guarantor, each Ancillary Agreement to which any of
the Company, the Company Subsidiaries, the DC Contributors and the Signing DC
Contributors Affiliates is or will be a party, upon its execution by such
Person, shall have been duly executed and delivered by such Person, and
(assuming due authorization, execution and delivery by the other parties
thereto) shall constitute the legal, valid and binding obligation of such
Person, enforceable against such Person in accordance with its terms, subject
to the effect of any applicable bankruptcy, insolvency (including, all Laws
relating to fraudulent transfers), reorganization, moratorium or similar laws
affecting creditors’ rights generally and subject to the effect of general
principles of equity (regardless of whether considered in a proceeding at law
or in equity).

 

SECTION 3.02.  Organization, Authority and Qualification.  The Company is a limited liability company
duly organized, validly existing and in good standing under the laws of the
State of Delaware and has all necessary power and authority to own, operate or
lease the properties and assets now owned, operated or leased by it and to
carry on the Company Business as it has been and is currently conducted.  The Company Subsidiaries are separate legal
entities

 

32

 

duly organized
and validly existing and in good standing (if such concept is applicable) under
the laws of the respective jurisdictions of their organization, except where
the failure to be so duly organized and validly existing would not have a
Company Material Adverse Effect.  The
Company and the Company Subsidiaries are duly licensed or qualified to do
business and are in good standing (if such concept is applicable) in each
jurisdiction in which the properties owned or leased by them or the operation
of their business makes such licensing or qualification necessary, except to
the extent that the failure to be so licensed, qualified and in good standing
would not have a Company Material Adverse Effect.  True and correct copies of the Fundamental
Documents of the Company and the Company Subsidiaries (and of the document
retention policy, as in effect on the date hereof, of the DC Contributors) have
been made available by the DC Contributors to the Investor.

 

SECTION 3.03.  Ownership of Company Equity Interests;
Subsidiaries. (a) After giving effect to the consummation of the
Pre-Closing Restructuring Transactions, DC Holding will be the record and
beneficial owner of all of the Company Equity Interests, and there will be no
other outstanding Equity Interests of the Company.  All of the Company Equity Interests will have
been duly authorized and validly issued, and none of the Company Equity
Interests will have been issued in violation of, and none of the Company Equity
Interests will be subject to, any preemptive or subscription rights.  At the Closing, the Company shall issue and
deliver to the Investor good and valid title to the Investor Equity Interests,
free and clear of all Encumbrances, and the Investor shall be admitted as a
member of the Company.  Immediately after
giving effect to the Closing, the Investor Equity Interests shall constitute,
in the aggregate, an undivided 80.1% limited liability company membership
interest in the Company and the other Company Equity Interests shall
constitute, in the aggregate, an undivided 19.9% limited liability company
membership interest in the Company.  All
of the Investor Equity Interests, when issued by the Company to the Investor at
the Closing pursuant to this Agreement, shall have been duly authorized and
validly issued and shall have been issued to the Investor not in violation of
any preemptive or subscription rights, rights of first offer or first refusal
or similar rights.  Neither any DC
Contributor nor the Guarantor nor any of their respective Affiliates is a party
to, and none of the Company Equity Interests are the subject of, any voting
trust, proxy or other agreement or understanding (including options or rights
of first offer or first refusal) with respect to the voting, purchase, sale or
other disposition of the Company Equity Interests, except this Agreement and
the LLC Operating Agreement.

 

(b)           After giving effect to
the consummation of the Pre-Closing Restructuring Transactions and the
Post-Closing Restructuring Transactions and except as set forth in Section 3.03(b) of
the DC Contributors Disclosure Schedule, (i) (x) all Equity Interests
in the Company Subsidiaries will be owned by the Company or one or more Company
Subsidiaries (and, upon the occurrence of the Closing and the Post-Closing
Restructuring Transactions, all Equity Interests in the Company Subsidiaries
will be owned by the Company or one or more Company Subsidiaries), (y) free
and clear of all Encumbrances, (ii) all Equity Interests in the Company
Subsidiaries will be duly authorized and validly issued and (to the extent such
concepts are applicable) be fully paid and nonassessable, (iii) none of
the Equity Interests in the Company Subsidiaries will have been issued or
conveyed in violation of, and none of the Equity Interests in the Company
Subsidiaries will be subject to (x) any preemptive or subscription rights,
rights of first offer or first refusal or similar rights or (y) any voting
trust, proxy or other agreement or understanding (including options or rights
of first offer or first refusal) with respect to the voting,

 

33

 

purchase, sale
or other disposition thereof, and (iv) the Company will not own any Equity
Interests in any Person (other than a Company Subsidiary).

 

SECTION 3.04.  No Conflict.  Assuming that all consents, approvals,
authorizations and other actions described in Section 3.05 have been
obtained, all filings and notifications listed in Section 3.05 of the DC
Contributors Disclosure Schedule have been made and any applicable waiting
period has expired or been terminated, and except as may result from any facts
or circumstances relating solely to the Investor or its Affiliates, the
execution, delivery and performance by each of the DC Contributors of this
Agreement and the Ancillary Agreements to which such DC Contributor is or will
be a party (and the execution, delivery and performance by each of the Signing
DC Contributors Affiliates of the Ancillary Agreements to which it is or will
be a party), do not and will not (a) violate, conflict with or result in
the breach of any provision of the Fundamental Documents of such DC
Contributor, any Signing DC Contributors Affiliate, the Company, or any Company
Subsidiary, (b) conflict with or violate any Law or Governmental Order
applicable to such DC Contributor, any Signing DC Contributors Affiliate, the
Company or any Company Subsidiary, (c) except as set forth in Section 3.04
of the DC Contributors Disclosure Schedule, conflict with, result in any breach
of, constitute a default (or event which with the giving of notice or lapse of
time, or both, would become a default) under, require any consent under, or
give to others any rights of termination, amendment, payment, acceleration or
cancellation of, any note, bond, mortgage or indenture, contract, agreement,
lease, sublease, license, permit, franchise or other instrument or arrangement
to which such DC Contributor, any Signing DC Contributors Affiliate, the
Company or any Company Subsidiary is a party, or (d) result in the
creation of any Encumbrances (other than Permitted Encumbrances) upon the
assets of the Company and the Company Subsidiaries, except, in the case of
clauses (b), (c) and (d), as would not have a Company Material Adverse
Effect.

 

SECTION 3.05.  Governmental Consents and Approvals.  The execution, delivery and performance of
this Agreement and the Ancillary Agreements by the DC Contributors or any
Signing DC Contributors Affiliate, as the case may be, do not and will not
require any consent, approval, authorization or other order of, action by,
filing with or notification to, any Governmental Authority, except (a) as
set forth in Section 3.05 of the DC Contributors Disclosure Schedule, (b) the
pre-merger notification and waiting period requirements of the HSR Act, (c) the
requirements of the Antitrust Laws of any other relevant jurisdiction, except
where such failures to obtain such consents, approvals, authorizations or
actions, or to make such filings or notifications, would not have a Company
Material Adverse Effect or prevent or materially delay the ability of either
the DC Contributors or the Guarantor to consummate the transactions
contemplated by this Agreement, or (d) as may be necessary as a result of
any facts or circumstances relating solely to the Investor or any of its
Affiliates. Prior to the Closing, all material approvals, authorizations or
other orders of, actions by, filings with or notifications to, any Governmental
Authority, required for the occurrence of the Pre-Closing Restructuring
Transactions shall have been obtained or made.

 

SECTION 3.06.  Financial Statements; SEC Documents;
Internal Controls.  (a) DC
Holding has delivered to the Investor true and complete copies of the following
(collectively, the “Company Financial Statements”):

 

34

 

(i)            the audited combined balance sheets of DCC
and its Subsidiaries (collectively, the “Industrial Companies”) as of December 31,
2005 and December 31, 2006 and the related audited combined statements of
operations and comprehensive income and cash flows of the Industrial Companies,
for the fiscal years ended as of December 31, 2004, December 31, 2005
and December 31, 2006, in each case presented on a carve-out basis to
include solely the historical financial position, results of operations and
cash flows applicable to the Industrial Business for the dates and periods
covered thereby (such basis of presentation, the “Industrial Business
Carve-Out Basis”);

 

(ii)           the audited combined balance sheets of FinCo
and its Subsidiaries (collectively, the “Financial Services Companies”)
as of December 31, 2005 and December 31, 2006 and the related audited
combined statements of operations and comprehensive income and cash flows of
the Financial Services Companies, for the fiscal years ended as of December 31,
2004, December 31, 2005 and December 31, 2006, in each case presented
on a carve-out basis to include solely the historical financial position,
results of operations and cash flows applicable to the Financial Services
Business for the dates and periods covered thereby (together with item (i), the
“Audited Company Financial Statements”; and such basis of presentation,
the “Financial Services Business Carve-Out Basis”);

 

(iii)          the unaudited combined balance sheets of the
Industrial Companies as of March 31, 2006, June 30, 2006 and September 30,
2006, and the related unaudited combined statements of income and cash flows of
the Industrial Companies for the fiscal quarters ended March 31, 2006, June 30,
2006 and September 30, 2006, in each case presented on an “as is” basis;
and

 

(iv)          the
unaudited combined balance sheets of the Financial Services Companies as of March 31,
2006, June 30, 2006 and September 30, 2006, and the related unaudited
combined statements of operations and comprehensive income and cash flows of
the Financial Services Companies for the fiscal quarters ended March 31,
2006, June 30, 2006 and September 30, 2006, in each case presented on
an “as is” basis (items (iii) and (iv), together with the Unaudited 2007
Company Financial Statements, the “Unaudited Company Financial Statements”).

 

(b)           Except
as set forth in Section 3.06(b) of the DC Contributors Disclosure
Schedule, the Company Financial Statements (i) were or, (in the case of
the Unaudited 2007 Unaudited Company Financial Statements) will be, prepared in
accordance with the books and records of the Industrial Companies or the
Financial Services Companies, as applicable, (ii) present, or (in the case
of the Unaudited 2007 Company Financial Statements), will present fairly in all
material respects the combined financial condition of the Industrial Companies
or the Financial Services Companies, as applicable, as of the dates thereof and
the combined statements of operations and comprehensive income and cash flows
of the Industrial Companies or the Financial Services Companies, as applicable,
for the periods covered thereby, and (iii) were or, (in the case of the
Unaudited 2007 Company Financial Statements) will be, prepared in accordance
with the requirements of Regulation S-X promulgated by the SEC and were
prepared in accordance with GAAP (and with the Accounting Principles) applied
on a consistent basis

 

35

 

during the
periods covered thereby and on a basis consistent with the past practices of
the Industrial Companies or the Financial Services Companies, as applicable
(subject, in the case of the Unaudited Company Financial Statements, to the
lack of footnote disclosure and changes of the type that are normal year-end
adjustments the effect of which adjustments are not expected by the Company to
be material individually or in the aggregate). 
The Unaudited 2007 Company Financial Statements will be reviewed by KPMG
LLP (the “Reviewing Accounting Firm”) in accordance with Statement on
Auditing Standards 100 (“SAS 100”), and DC Holding will deliver a true
and complete copy of the review report of the Reviewing Accounting Firm with
respect thereto to the Investor on or prior to June 15, 2007. The
Supplemental Financial Reports, to the extent delivered to the Investor, shall
have been derived from the books and records of the Company and shall be
accurate in all material respects as of their respective dates.

 

(c)           The
Guarantor and its Subsidiaries, including the Company and the Company
Subsidiaries, have timely filed with the SEC all documents required to be filed
by them since January 1, 2004 (the “Filed SEC Documents”) which
relate to, or include disclosure with respect to, the Industrial Business or
the Financial Services Business.  As of
their respective filing dates, none of the Filed SEC Documents, solely to the
extent related to or including disclosure with respect to the Industrial
Business or the Financial Services Business, contained any untrue statement of
a material fact or omitted to state material facts required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.  As of the date hereof, there are no
outstanding or unresolved comments in comment letters received from the SEC
staff with respect to any of the Filed SEC Documents, to the extent related to,
or related to disclosure with respect to, the Industrial Business or the
Financial Services Business.

 

(d)           Except
as set forth in Section 3.06(d) of the DC Contributors Disclosure
Schedule, (i) to the DC Contributors’ Knowledge, neither the Company nor
any Company Subsidiary, nor any director, officer, employee, auditor,
accountant or representative of the Company of the Company or any Company
Subsidiary who is charged with responsibility for such matters, has received or
otherwise has obtained knowledge of any material complaint, allegation,
assertion or claim, whether written or oral, regarding the accounting or
auditing practices, procedures, methodologies or methods of the Company or any
Company Subsidiary or their respective internal accounting controls, including
any material complaint, allegation, assertion or claim that the Company or any
Company Subsidiary has engaged in questionable accounting or auditing
practices, and (ii) no attorney representing the Company or any Company
Subsidiary has reported evidence of a material violation of securities laws,
breach of fiduciary duty or similar violation by the Company or any Company
Subsidiary or any of their respective directors, officers, employees or agents.

 

(e)           DC
Holding has delivered, or, with respect to the audited financial statements for
the fiscal year ended on December 31, 2006 (the “Audited 2006 SAP
Statements”), will have delivered as soon as practicable after their
preparation, to the Investor true and complete copies of the (i) audited
balance sheets of the Insurance Subsidiary as of December 31, 2005 and December 31,
2006 and an unaudited balance sheet of the Insurance Subsidiary as of December 31,
2006 and the related statements of income and of cash flows for the fiscal
years ended December 31, 2004, December 31, 2005 and December 31,
2006, and (ii) balance sheets of the Insurance Subsidiary as of March 31,
2006, June 30, 2006 and September

 

36

 

 

30, 2006 and
the related statements of income and of cash flows for the fiscal quarters
ended March 31, 2006, June 30, 2006 and September 30, 2006 (the “Quarterly
SAP Statements”), in each case to the extent the Insurance Subsidiary is
required by applicable Law to prepare such balance sheets and statements, and
in each case as filed with the Governmental Authority charged with supervision
of insurance companies of such subsidiary’s jurisdiction of domicile (the “Insurance
Regulator”).  The foregoing financial
statements were or will have been prepared in conformity with statutory
accounting practices prescribed or permitted by such Insurance Regulator
applied on a consistent basis (“SAP”) and present or will present
fairly, to the extent required by and in conformity with SAP, except as set
forth in the notes, exhibits or schedules thereto, in all material respects the
statutory financial condition of the Insurance Subsidiary at each respective
date and the statutory results of operations and cash flows of the Insurance
Subsidiary for each of the periods then ended (subject, in the case of the
Quarterly SAP Statements, to changes of the type that are normal year-end
adjustments the effect of which adjustments are not expected by the Company to
be material individually or in the aggregate). 
Except as indicated therein, all assets that are reflected as admitted
assets in the foregoing financial statements comply in all material respects
with all applicable insurance Laws with respect to admitted assets and are in
an amount at least equal to the minimum amounts required by applicable
insurance Laws.  The surplus as regards
policyholders in the balance sheet included in the Audited 2006 SAP Statements
will be greater than $165 million.

 

(f)            The
only Company Subsidiaries (other than DCMH) not reflected in the Company
Financial Statements are those listed on Schedule 3.06(f) (the “Orphan
Subsidiaries”).

 

(g)           With
respect to Schedule 3.06(g), the amounts listed in the lines “Total Cash &
Cash Equivalents”, “Total Intercompany Notes Receivable”, “Total Third Party
Financial Liabilities” and “Total Intercompany Financial Liabilities” are true
and correct.

 

SECTION 3.07.  Absence of Undisclosed Material
Liabilities.  (a) There are no
Liabilities of the Company or any Company Subsidiary of a nature required to be
reflected on a balance sheet prepared in accordance with GAAP, other than
Liabilities (i) reflected or reserved against on the Audited Company
Financial Statements, (ii) set forth in Section 3.07(a) of the
DC Contributors Disclosure Schedule, (iii) incurred since December 31,
2006 in the ordinary course of business of the Company and the Company
Subsidiaries (or the Company Business), (iv) which, as of the date of this
Agreement,  together with those
Liabilities described in clause (iii) above, would not have a Company
Material Adverse Effect, or (v) which are Liabilities arising after the
date of this Agreement and which would not have a Company Material Adverse
Effect.

 

(b)           Section 3.07(b) of
the DC Contributors Disclosure Schedule sets forth a true and complete schedule
of all Indebtedness and Contingent Obligations involving amounts not less than
$50 million as of April 30, 2007 (provided that Section 3.07 of the
DC Contributors Disclosure Schedule has been prepared as of March 31, 2007
with respect to the Financial Service Companies) of (i) the Company or any
Company Subsidiary, including in favor of, or otherwise for the benefit of, the
DC Contributors or any Affiliate thereof (other than the Company and the
Company Subsidiaries) and including any deemed allocation thereof on the books
and records of any of such Persons and (ii) the DC Contributors or any
Affiliates thereof (other than the Company and the Company Subsidiaries) in
favor of, or otherwise for the benefit

 

37

 

of, the Company
or any Company Subsidiary and including any deemed allocation thereof on the
books and records of any of such Persons (and includes an indication as to
whether the same will survive the Closing).

 

SECTION 3.08.  Conduct in the Ordinary Course.  Since December 31, 2006 through the date
of this Agreement, except as set forth in Section 3.08 of the DC
Contributors Disclosure Schedule, each of the Financial Services Business and
the Industrial Business has been conducted by DCC, FinCo or the Company Subsidiaries
and not by any other entity in the ordinary course and, from such date until
the date of this Agreement, there has not occurred any Company Material Adverse
Effect and none of the Company or any Company Subsidiary has taken (or agreed
to take) any action that, if taken after the date hereof, would constitute a
violation of Section 5.01(a)(v), 5.01(b)(ii), (iii), (v), (vi)(E), (xii),
(xvi) or (xxiii).

 

SECTION 3.09.  Litigation.  As of the date hereof, except as set forth in
Section 3.09 of the DC Contributors Disclosure Schedule, there are no
Actions naming as parties or, if not named as parties, to the DC Contributors’
Knowledge, concerning, the Company or the Company Subsidiaries pending or, to
the DC Contributors’ Knowledge, threatened in writing, that result in a Company
Material Adverse Effect or that would affect the legality, validity or
enforceability of this Agreement, any Ancillary Agreement or the consummation
of the transactions contemplated hereby or thereby.

 

SECTION 3.10.  Compliance with Laws.  Except as set forth in Section 3.10 of
the DC Contributors Disclosure Schedule or as would not have a Company Material
Adverse Effect: (i) the Company or the Company Subsidiaries have conducted
and continue to conduct the Company Business in accordance with all Laws and
Governmental Orders applicable to the Company or any Company Subsidiary, and
neither the Company nor any Company Subsidiary is in violation of any such Law
or Governmental Order; and (ii) each of the Company and the Company
Subsidiaries has in effect all Permits necessary for it to own, lease or
operate its properties and assets and to carry on the Company Business as now
conducted, and no default has occurred under any such Permit.

 

SECTION 3.11.  Environmental Matters. (a) Except as
disclosed in Section 3.11 of the DC Contributors Disclosure Schedule or
except as would not have a Company Material Adverse Effect:

 

(i)            the Company and the Company Subsidiaries
are in compliance with all applicable Environmental Laws and have obtained and
are in compliance with all Environmental Permits;

 

(ii)           there are no written pending Environmental
Claims received by the Company or any Company Subsidiary or, to the Knowledge
of the DC Contributors, threatened in writing and received by the Company or any
Company Subsidiary;

 

(iii)          there
are no facts or circumstances relating to Hazardous Materials that, to the
Knowledge of the DC Contributors, would reasonably be expected to

 

38

 

result in an
Environmental Claim or Environmental Liability against the Company or any
Company Subsidiary;

 

(iv)          to
the Knowledge of the DC Contributors, there is and has been no Release at, on
or from any property currently owned or operated by the Company or any Company
Subsidiary, or, with respect to formerly owned or operated properties, during
the period of ownership or operation by the Company or any Company Subsidiary
or any entity that is a predecessor to the Company or a Company Subsidiary,
that would be reasonably expected to give rise to an Environmental Claim or
Environmental Liability;

 

(v)           to the Knowledge of the DC Contributors, no
properties presently or formerly owned, leased or operated by either the
Company or any Company Subsidiary, or any entity that is a predecessor to the
Company or a Company Subsidiary, contain any landfills, surface impoundments,
underground storage tanks, above-ground storage tanks or otherwise store
Hazardous Materials in a manner that would be reasonably expected to give rise
to an Environmental Claim or Environmental Liability;

 

(vi)          to
the Knowledge of the DC Contributors, there is and has been no Release of
Hazardous Materials at any facility that received Hazardous Materials generated
by the Company or any Company Subsidiary or any entity that is a predecessor to
the Company or a Company Subsidiary, that would be reasonably expected to give
rise to an Environmental Claim or Environmental Liability;

 

(vii)         there
are no Environmental Liens on any of the properties currently owned, leased or
operated by the Company or any Company Subsidiary; and

 

(viii)        neither
the Company nor any Company Subsidiary nor any entity that is a predecessor to
the Company or a Company Subsidiary is subject to any agreement that may
require it to pay to, reimburse, guarantee, pledge, defend, indemnify or hold
harmless any Person for or against any Environmental Claim or Environmental
Liabilities arising from any Releases on or from any properties formerly owned
or operated by the Company or any Company Subsidiary or any entity that is a
predecessor to the Company or any Company Subsidiary.

 

(b)           The
DC Contributors have made available to the Investor complete and true copies of
documents sufficient to describe the DC Contributor’s Knowledge of the current
state of the groundwater conditions and vapor intrusion in and around the
Dayton Thermal Facility in Dayton, Ohio, including any and all material written
claims, environmental reports, studies, investigations and correspondence,
including Phase I and Phase II environmental site assessments generated for or
on behalf of the DC Contributors, the Company, a Company Subsidiary or a
predecessor in interest, in each case, that are in the DC Contributors’, the
Company’s, or a Company Subsidiary’s possession.

 

(c)           The
Investor acknowledges that (i) the representations and warranties
contained in this Section 3.11 are the only representations and warranties
being made with

 

39

 

respect to
compliance with or liability under Environmental Laws, any Environmental
Claims, Environmental Liabilities, or with respect to any environmental, health
or safety matter, including natural resources, related in any way to the
Company or the Company Business or to this Agreement or its subject matter, (ii) no
other representation contained in this Agreement shall apply to any such
matters and no other representation or warranty, express or implied, is being
made with respect thereto, and (iii) the representations and warranties
contained in this Section 3.11 shall survive the Closing for a period of
three years.

 

SECTION 3.12.  Company Intellectual Property and IT
Systems.  (a) Section 3.12(a)(i)-(iii) of
the DC Contributors Disclosure Schedule contains a complete and accurate list,
in all material respects, of all Registered Company Owned Intellectual Property
as of the date hereof (together with the current owner of record thereof)
except for copyrights.  To the Knowledge
of the DC Contributors, Section 3.12(a)(iv) of the DC Contributors
Disclosure Schedule contains a complete and accurate list, in all material
respects, of all the Registered copyrights owned by the Company or a Company
Subsidiary as of the date hereof (together with the current owner of record
thereof).

 

(b)           Except
as would not have a Company Material Adverse Effect, (i) except as set
forth on Section 3.12(b)(i) of the DC Contributors Disclosure
Schedule, the Company or a Company Subsidiary is the exclusive owner of all
right, title and interest in and to each item of Registered Company Owned
Intellectual Property set forth on Section 3.12(a)(i)-(iii) of the DC
Contributors Disclosure Schedule, and, except as set forth on Section 3.12(b)(i) of
the DC Contributors Disclosure Schedule, to the Knowledge of the DC
Contributors, is the exclusive owner of all right, title and interest in and to
each item of Registered Company Owned Intellectual Property set forth on Section 3.12(a)(iv) of
the DC Contributors Disclosure Schedule, in each case free and clear of all
Encumbrances (other than Permitted Encumbrances), (ii) all of the material
Registered Company Owned Intellectual Property is subsisting and none of the
material Registered Company Owned Intellectual Property has been adjudged
invalid or unenforceable or is subject to any order, judgment or decree
restricting its use or adversely reflecting or affecting the Company’s or a
Company Subsidiary’s rights therein, (iii) the Company or a Company
Subsidiary owns or has a valid license to use all material Company Intellectual
Property in connection with the operation of the Company Business as currently
conducted, and (iv) subject to the DC Contributors’ Knowledge with respect
to Section 3.12(c) of this Agreement, the Company Intellectual
Property and the DC Contributors Intellectual Property, provided pursuant to
the Ancillary Agreements, include all of the material Intellectual Property
used in the operation of the Company Business as currently conducted, except
for any Intellectual Property owned by any third party (A) that the
Company or a Company Subsidiary is licensed to use pursuant to Shrink-Wrap
Agreements, or (B) for which a license to use such Intellectual Property
is not required under applicable Law.

 

(c)           To
the Knowledge of the DC Contributors and except as would not have a Company Material
Adverse Effect, (i) the use of the Company Intellectual Property and the
DC Contributors Intellectual Property by the Company and the Company
Subsidiaries in connection with the operation of the Company Business as
currently conducted does not infringe, violate or misappropriate the
Intellectual Property rights of any third party, and, (ii) except as set
forth in Section 3.12(c) of the DC Contributors Disclosure Schedule,
there is no Action pending or threatened in writing, against the Company or any
Company Subsidiary concerning the

 

40

 

infringement,
violation or misappropriation of the Intellectual Property rights of any third
party.  Except as set forth in Section 3.12(c) of
the DC Contributors Disclosure Schedule, to the Knowledge of the DC
Contributors there is no Action pending or, to the Knowledge of the DC
Contributors, threatened in writing, against the Company or any Company
Subsidiary concerning the ownership, validity, registerability or enforceability
of any Intellectual Property (other than the review of pending patent and
trademark applications by an applicable Governmental Authority).  To the Knowledge of the DC Contributors, no
Person is engaging in any activity that infringes, violates or misappropriates
any Registered or material Company Owned Intellectual Property in any manner
that would have a Company Material Adverse Effect, and, except as set forth in Section 3.12(c) of
the DC Contributors Disclosure Schedule, there is no Action pending or, to the
Knowledge of the DC Contributors, threatened in writing, by the Company or any
Company Subsidiary concerning the foregoing.

 

(d)           Except
as would not have a Company Material Adverse Effect, the Company and the
Company Subsidiaries have taken commercially reasonable measures to maintain in
confidence all material trade secrets and confidential information owned or
used by the Company and the Company Subsidiaries in connection with the
operation of the Company Business as presently conducted, and, to the Knowledge
of the DC Contributors, no unauthorized disclosure of any such material trade
secrets or confidential information has occurred.

 

(e)           Except
as would not have a Company Material Adverse Effect, (i) there has not
been any material malfunction with respect to any of the Company IT Systems of
the Company or a Company Subsidiary since January 1, 2004 that has not
been remedied or replaced in all material respects, and (ii) the Company
IT Systems constitute all the IT Systems required for the operation of the
Company Business as currently conducted.

 

(f)            Except
as would not have a Company Material Adverse Effect, (i) each of the
Company and the Company Subsidiaries has taken reasonable and customary
measures consistent with generally accepted industry practices to protect the
privacy of the personal or user data gathered or accessed in the course of the
operations of the Company Business, (ii) to the Knowledge of the DC
Contributors, there has been no material loss, unauthorized access, use, modification,
disclosure or other misuse of such data since January 1, 2004, and (iii) the
use and dissemination by the Company and the Company Subsidiaries of the data
concerning customers is in compliance with all applicable privacy policies,
terms of use and Laws.

 

(g)           The
Investor hereby acknowledges that, except with respect to the representations
and warranties set forth in Section 3.17 concerning Company IP Agreements
that are material to the Company Business, (i) the representations and
warranties contained in this Section 3.12 are the only representations and
warranties being made by the DC Contributors with respect to Intellectual
Property, and (ii) no other representation of the DC Contributors
contained in this Agreement shall apply to Intellectual Property and no other
representation or warranty, express or implied, of the DC Contributors is being
made with respect thereto.

 

SECTION 3.13.  Real Property.  (a) (i) Except as would not have a
Company Material Adverse Effect or except as described in Section 3.13(a) of
the DC Contributors Disclosure Schedule, to the DC Contributors’ Knowledge, the
Company or the Company Subsidiaries have good fee simple title (or its
equivalent in regards to non-U.S. properties) to

 

41

 

each parcel of
Company Owned Real Property, in each case free and clear of all Encumbrances,
except Permitted Encumbrances, and (ii) the DC Contributors have made
available to the Investor true copies of each vesting deed (or its equivalent
in regards to non-U.S. properties) for each parcel of Company Owned Real
Property and all title insurance policies and surveys for U.S. properties
relating to the Company Owned Real Property, in each case to the extent in the
DC Contributors’ possession and/or control.

 

(b)           Except
as described in Section 3.13(b) of the DC Contributors Disclosure
Schedule, to the DC Contributors’ Knowledge (i) the DC Contributors have
made available to the Investor true and complete copies of all leases,
subleases, licenses, sublicenses, and other use or occupancy agreements
(collectively, the “Leases”) in effect relating to all Company Leased
Real Property to the extent in the possession or control of the DC Contributors
or any of their Affiliates, (ii) there has not been any sublease or
assignment entered into by the Company or any Company Subsidiary in respect of
the Leases relating to the Company Leased Real Property, (iii) the Leases
have not been modified, amended, extended, assigned or subleased in any
material respect, except to the extent that such amendments, extensions,
assignments or subleases, or other modifications related thereto have been
delivered to the Investor, (iv) except as set forth on Section 3.13(b) of
the DC Contributors Disclosure Schedule or as otherwise made available to the
Investor in the Electronic Data Room on or before 11:59 p.m., New
York City time, on May 10, 2007, the Company or a Company Subsidiary is
currently in occupancy of all of such Company Leased Real Property (pursuant to
written agreements) and has the exclusive right to the use and occupancy of the
Company Leased Real Property, subject to the terms of the Lease relating
thereto, and, subject to any Permitted Encumbrances, holds a valid and existing
leasehold interest under such Lease, (v) neither the Company nor the
Company Subsidiaries nor any other party thereto, is in default in any material
respect under any Leases, and (vi) such Leases are in full force and
effect, except, in the case of clauses (ii) through (v), inclusive, as would
not have a Company Material Adverse Effect.

 

(c)           To
the DC Contributors’ Knowledge and except as set forth in the leases or as
otherwise made available to the Investor in the Electronic Data Room on or
before 11:59 p.m., New York City time, on May 10, 2007, there are no
outstanding options to purchase, lease or use, or rights of first refusal or
first offer to purchase, lease or otherwise occupy, or other rights to
purchase, lease or otherwise use or occupy, the Company Real Property, or any
portion thereof or any interest therein, nor any Contracts to which the Company
or any Company Subsidiary is a party relating to the right to receive any
portion of the income or profits from the sale, operation or development
thereof, except for such options, rights or Contracts the existence of which
would not have a Company Material Adverse Effect.

 

(d)           To
the DC Contributors’ Knowledge, all options in favor of the Company or the
Company Subsidiaries to purchase any of the Company Leased Real Property, if
any, are in full force and effect, except for such options the failure of which
to be in full force and effect would not have a Company Material Adverse
Effect.

 

(e)           Neither
the Company nor any Company Subsidiary has received written notice that there
is pending or, to the Knowledge of the DC Contributors, otherwise threatened,
any (i) zoning application or proceeding, (ii) condemnation, eminent
domain or taking proceeding, (iii) tax certiorari proceeding or other tax
contest or dispute, or (iv) other claim,

 

42

 

action or
proceeding or other matter relating to any Company Real Property, or portion of
either thereof or interest therein that would have a Company Material Adverse
Effect.

 

(f)            To
the DC Contributors’ Knowledge, the Company and the Company Subsidiaries have
in full force and effect all Permits (and all registrations, applications,
qualifications, filings, franchises, licenses, notices, and rights with or from
Governmental Authorities) necessary for the current use and occupancy by such
Persons of their respective Company Real Properties and the conduct by them of
the Company Business thereat, all of which will continue in full force and
effect immediately following the Closing, except for such of the foregoing
items the absence of which would not have a Company Material Adverse Effect.

 

(g)           Except
as set forth on Section 3.04 of the DC Contributors Disclosure Schedule,
to the DC Contributors’ Knowledge, there is no Contract or Permit of the
Company or any Company Subsidiary or any Affiliate thereof affecting any of the
Company Real Property which requires the consent or approval of any Person for
the transactions contemplated hereby, except for such consents or approvals the
absence of which would not have a Company Material Adverse Effect.

 

SECTION 3.14.
 Employee Matters.  (a) Section 3.14(a)(1) of the DC Contributors
Disclosure Schedule lists all material Company Benefit Plans as of the date
hereof.  Except as set forth in Section 3.14(a)(2) of
the DC Contributors Disclosure Schedule, each material Company Benefit Plan is
in writing, and the DC Contributors have made available to the Investor (1) with
respect to each such Company Benefit Plan, a true and complete copy of (i) such
Company Benefit Plan; (ii) any related trust agreement or other funding
instrument; (iii) the most recent determination letter, if applicable; (iv) any
summary plan description; (v) for the most recent year (A) the Form 5500
(and attached schedules), (B) audited financial statements and (C) actuarial
valuation reports, including any FAS 106 reports and (2) any material
written communications received by the DC Contributors or the Company or any
Company Subsidiary from the Pension Benefit Guaranty Corporation (the “PBGC”)
in respect of any Company Benefit Plan subject to Title IV of ERISA concerning
the funded status of any such plan.  No
Company Employee employed in the United States is currently accruing any
pension benefits under, or participating in any welfare benefit plan, program
or arrangement sponsored or maintained by the DC Contributors or any Affiliate
(other than the Company or any Company Subsidiary).

 

(b)           Each
Company Benefit Plan has been operated in all material respects in accordance
with its terms and the requirements of all applicable Laws.  Each of the Company and the Company
Subsidiaries has performed all material obligations required to be performed by
it under, is not in any material respect in default under or in material violation
of, and to the DC Contributors’ Knowledge, there is no material default or
violation by any party to, any Company Benefit Plan.  Except as set forth in Section 3.14(b) of
the DC Contributors Disclosure Schedule, no Action is pending or, to the
Knowledge of the DC Contributors, threatened with respect to any Company
Benefit Plan (other than claims for benefits in the ordinary course) and, to
the Knowledge of the DC Contributors, no fact or event exists that could give
rise to any such Action.

 

43

 

(c)           Except
as set forth in Section 3.14(c) of the DC Contributors Disclosure
Schedule, each Company Benefit Plan that is intended to be qualified under Section 401(a) of
the Code has received a favorable determination letter from the IRS covering
all of the provisions applicable to the Company Benefit Plan for which
determination letters are currently available that the Company Benefit Plan is
so qualified, and each trust established in connection with any Company Benefit
Plan which is intended to be exempt from federal income taxation under Section 501(a) of
the Code has received a determination letter from the IRS that it is so
exempt.  Each request for such
determination letters was either filed prior to January 1, 2006 or was
filed prior to the end of the remedial amendment period for changes required by
the Economic Growth and Tax Relief Reconciliation Act of 2001 applicable to
each Company Benefit Plan.  To the
Knowledge of the DC Contributors, no circumstance and no fact or event exists
that would be reasonably likely to adversely affect the qualified or tax exempt
status of any Company Benefit Plan or that could reasonably be expected to
result in the revocation of a trust’s exemption from United States federal
income taxation.

 

(d)           All
contributions, premiums or payments required to be made with respect to any
Company Benefit Plan have been made on or before their required due dates.

 

(e)           Except
as set forth in Section 3.14(e) of the DC Contributors Disclosure
Schedule, neither any DC Contributor nor the Company nor any Company Subsidiary
has incurred any material liability under, arising out of or by operation of
Title IV of ERISA (other than liability for premiums to the PBGC arising in the
ordinary course), including any material liability in connection with (i) the
termination or reorganization of any employee benefit plan subject to Title IV
of ERISA, or (ii) the withdrawal from any multiemployer plan (within the
meaning of Section 3(37) or 4001(a)(3) of ERISA) (a “Multiemployer
Plan”) or any single employer pension plan (within the meaning of Section 4001(a)(15)
of ERISA) for which the Company or any Company Subsidiary could incur liability
under Section 4063 or 4064 of ERISA.

 

(f)            Each
Company Benefit Plan that is intended or required to be registered under the
Income Tax Act (Canada) and applicable provincial pension standards legislation
is so registered.  To the Knowledge of
the DC Contributors, no circumstance and no fact or event exists that would be
reasonably likely to adversely affect the registered status of any Company
Benefit Plan or that could reasonably be expected to result in the revocation
of a Company Benefit Plan’s exemption from Canadian federal income taxation or
the imposition of any penalty under the Income Tax Act (Canada).  Each unregistered Canadian Company Benefit
Plan has been administered in accordance with the Income Tax Act (Canada).  Any deduction claimed under the Income Tax
Act with respect to any contribution to a Canadian Company Benefit Plan is
permitted under the Income Tax Act (Canada). 
All taxes under the Income Tax Act (Canada) in respect of trusts
established in connection with unregistered Canadian Company Benefit Plans have
been paid on or before their required due dates.

 

(g)           With
respect to each Company Benefit Plan that is not subject to United States or
Canadian Law (a “Foreign Benefit Plan”), (i) all employer and
employee contributions to each Foreign Benefit Plan required by Law or by the
terms of such Foreign Benefit Plan have been made or, if applicable, accrued in
accordance with normal accounting practices, and (ii)

 

44

 

each Foreign
Benefit Plan required to be registered has been registered and has been
maintained in good standing with applicable regulatory authorities.

 

(h)           Except
as set forth in Section 3.14(h) of the DC Contributors Disclosure
Schedule, neither the execution of this Agreement nor the consummation of the
transactions contemplated by this Agreement (whether alone or in connection with
any subsequent termination of employment of any Company Employee) will (i) entitle
any Company Employee to any increase in severance pay under any Company Benefit
Plan or (ii) accelerate the time of payment or vesting, trigger any
payment or funding (through a grantor trust or otherwise) of compensation or
benefits under, or increase the amount payable pursuant to, any of the Company
Benefit Plans, or result in the payment of any tax gross-up in respect of any
parachute payments under Section 280G of the Code.

 

(i)            As
of the date of this Agreement, each of the individuals set forth in Section 3.14(i) of
the DC Contributors Disclosure Schedule is an employee of the Company or a
Company Subsidiary.

 

SECTION 3.15.  Labor Matters.  Section 3.15 of the DC Contributors
Disclosure Schedule sets forth each Collective Bargaining Agreement or other
labor union contract to which the Company or any Company Subsidiary is a party
on the date of this Agreement, applicable to current employees of the Company
or any Company Subsidiary and there are no other Collective Bargaining
Agreements with respect to Company Employees. 
Except as set forth in Section 3.15 of the DC Contributors
Disclosure Schedule, as of the date of this Agreement, (a) there are no
material strikes, slowdowns or work stoppages between the Company or any
Company Subsidiary, on the one hand, and any labor organization representing
employees, on the other hand, and neither the Company nor any Company
Subsidiary has experienced any such strike, slowdown or work stoppage within
the past three years, (b) there are no grievances or arbitrations under
any Collective Bargaining Agreement outstanding against the Company or any
Company Subsidiary having a Company Material Adverse Effect, (c) there are
no unfair labor practice complaints or representation petitions pending against
the Company or any Company Subsidiary before the National Labor Relations Board
or any other similar Governmental Authority having a Company Material Adverse
Effect, and (d) the Company and each Company Subsidiary is currently in
compliance in all material respects with all applicable Laws relating to the
employment of labor, including those related to wages, hours, the Worker
Adjustment and Retraining Notification Act, collective bargaining,
nondiscrimination, and the payment and withholding of taxes.

 

SECTION 3.16.
 Taxes.  Except as set forth in Section 3.16 of
the DC Contributors Disclosure Schedule, (a) all Tax Returns required to
have been filed by or with respect to the Company or any Company Subsidiary
have been timely filed (taking into account any extension of time to file
granted or obtained) and are correct and complete in all material respects,
except for Tax Returns the nonfiling of which is not material to the Company or
any Company Subsidiary, (b) all material amounts of Tax required to be
paid by the Company or any Company Subsidiary (whether or not shown on any Tax
Return) have been timely paid or are being contested in good faith by
appropriate proceedings and have been reserved for on the Unaudited 2007
Company Financial Statements, (c) no deficiency for any material amount of
Tax has been asserted or assessed by a Governmental Authority in writing
against the Company

 

45

 

or any Company
Subsidiary that has not been satisfied by payment, settled or withdrawn, (d) there
is no audit, claim or controversy currently asserted or threatened in writing
with respect to the Company or any Company Subsidiary in respect of any
material amount of Tax or failure to file any Tax Return, (e) neither the
Company nor any Company Subsidiary has agreed to any extension or waiver of the
statute of limitations applicable to any material Tax Return, or agreed to any
extension of time with respect to a material Tax assessment or deficiency,
which period (after giving effect to such extension or waiver) has not yet
expired, (f) neither the Company nor any Company Subsidiary is a party to
or the subject of any ruling requests, private letter rulings, closing
agreements, settlement agreements or similar agreements with any Taxing
Authority for any periods for which the statute of limitations has not yet run,
(g) neither the Company nor any Company Subsidiary is a party to any Tax
allocation or Tax sharing agreement (other than Tax allocation or Tax sharing
agreements which will be terminated prior to Closing and with respect to which
no post-Closing liabilities or obligations will exist), (h) the Company
and the Company Subsidiaries each has withheld or collected all material Taxes
(such Taxes being material either individually or in the aggregate) required to
have been withheld or collected and, to the extent required, has paid such
Taxes to the proper Governmental Authority, (i) neither the Company nor
any Company Subsidiary will be required to make any material adjustments in
taxable income for any tax period (or portion thereof) ending after the Closing
Date pursuant to Section 481(a) or 263A of the Code or any similar
provision of foreign, provincial, state, local or other law as a result of
transactions or events occurring, or accounting methods employed, prior to the
Closing, nor is any application pending with any Taxing Authority requesting
permission for any changes in accounting methods that relate to the Company or
any Company Subsidiary, (j) for U.S. federal income tax purposes and all
material relevant state and local income tax purposes, each of the Company and
the Company Subsidiaries is, and as of the Closing Date will be, classified as
either a partnership or a disregarded entity separate from its owner and is
not, and as of the Closing Date will not be, treated as a corporation or as an
association taxable as a corporation, (k) the Company Benefit Plans,
warranties pertaining to the items sold pursuant to the Company Business and
any other contingent liabilities pertaining to the Company Business will be
assumed by the Company or any Company Subsidiary pursuant to the Pre-Closing
Restructuring Transactions on or prior to the Closing Date, and all such
liabilities assumed by the Company were incurred through the ordinary course of
operations of the Company Business, (l) the transfers described in Section 2.03(b)(ii) and
(iii) constitute a contribution to the Company of a trade or business
within the meaning of Section 1.752-7(b)(10) of the Regulations, (m) there
are no Tax liens on any assets of the Company or any Company Subsidiary (other
than Permitted Encumbrances), and (n) the amount of pre-formation
expenditures within the meaning of Section 1.707-4(d) of the
Regulations that DC Holding has incurred in respect of the Company is not less
than $2.5 billion.

 

SECTION 3.17.  Material Contracts.  (a) Section 3.17(a) of the DC
Contributors Disclosure Schedule lists each of the following Contracts of the
Company and the Company Subsidiaries as of the date hereof:

 

(i)            all Contracts with independent contractors
or consultants involving the payment by the Company or the Company Subsidiaries
of more than $5 million annually that are not cancelable without penalty or
further payment and without more than ninety (90) days’ notice;

 

46

 

(ii)           any employment, severance, change in
control, consulting or similar Contract requiring payment by the Company or any
Company Subsidiary of a base annual compensation in excess of $500,000;

 

(iii)          all Contracts for the purchase or sale of
materials, supplies, equipment or services (other than purchase orders), or the
lease, sublease or license of real property (whether as lessor, sublessor,
lessee, sublessee, licensor, or licensee), involving payment by or to the
Company or the Company Subsidiaries of more than $10 million annually (in the
case of a lease, sublease or license of real property, based on 2007 base
rent);

 

(iv)          all Finance Agreements under which any
Financial Services Company expects to receive revenue in excess of $25 million
annually;

 

(v)           all Contracts related to Securitization
Transactions or Derivative Transactions that are material to the Industrial
Business or the Financial Services Business;

 

(vi)          all Contracts relating to Indebtedness, in
each case having an outstanding principal amount in excess of $50 million, and
all Contracts relating to Contingent Obligations, in each case having an amount
in excess of $50 million;

 

(vii)         all Contracts with any Governmental Authority
involving total annual payments in excess of $10 million;

 

(viii)        all material Company IP Agreements and all
material Company IT Agreements;

 

(ix)           any Contract or Governmental Order containing
(x) a covenant not to compete or (y) any other restriction, in each
case that materially impairs the ability of the Company, the Industrial
Companies, the Financial Services Companies, or any Affiliates of the Company
to engage in any line of business or to compete with any Person, other than
joint venture agreements to the extent disclosed in Section 3.17(a) of
the DC Contributors Disclosure Schedule;

 

(x)            any joint venture agreement, strategic
alliance agreement, partnership agreement, limited liability company agreement,
stockholders agreement or voting agreement or other similar co-ownership or
joint management agreement involving a sharing of profits, losses, costs or
liabilities by the Company or any Company Subsidiary with any other Person (other
than the Company or any Company Subsidiary) or relating to any ownership or
equity interest of the Company or any Company Subsidiary in any other Person
(other than the Company or any Company Subsidiary), in each case that is (x) material
to the Financial Services Business or the Industrial Business or (y) under
which the Company reasonably expects the Company and the Company Subsidiaries
to be required to make payments exceeding $10 million in the aggregate after
the date of this Agreement;

 

47

 

(xi)           any
Affiliate Contract (or series of related Affiliate Contracts) (other than
purchase orders) involving payment by or to the Company and the Company
Subsidiaries of more than $10 million annually;

 

(xii)          any
Intercompany Contract (or series of related Intercompany Contracts) (other than
purchase orders) involving payment by or to the Financial Services Companies or
the Industrial Companies of more than $10 million annually;

 

(xiii)         all
Contracts (other than purchase orders) between (A) either of the DC
Contributors or an Affiliate of either of the DC Contributors (other than the
Company or any Company Subsidiary), on the one hand, and a Person that is not
an Affiliate of either of the DC Contributors, on the other hand, of which the
Company or a Company Subsidiary is a beneficiary for an amount in excess of $10
million annually, and (B) the Company or a Company Subsidiary, on the one
hand, and a Person that is not an Affiliate of either of the DC Contributors,
on the other hand, of which either of the DC Contributors or an Affiliate of
either of the DC Contributors (other than the Company or any Company
Subsidiary) is a beneficiary for an amount in excess of $10 million annually;

 

(xiv)        any
other Contract, or group of related Contracts (other than purchase orders) that
is or would be required to be filed by any of the Company, the Industrial
Companies and the Financial Services Companies with the SEC as a “material
contract” (as such term is defined in Item 601(b)(10) of Regulation S-K
promulgated by the SEC), if such Person had securities registered under the
Exchange Act;

 

(xv)         any
(A) reinsurance or retrocessional agreement, either ceded or assumed, with
reinsurance balances of greater than $5 million, (B) managing general
agency agreement, (C) insurance or reinsurance pooling agreement,
including any agreement relating to an assigned risk pool, in each case to
which the Insurance Subsidiary is a party, and (D) any material agreement
of the Insurance Subsidiary with any insurance agent, broker or producer; and

 

(xvi)        any
outstanding written commitment to enter into any Contract of the type described
in subsections (i) through (xv) of this Section 3.17.

 

(b)           The
DC Contributors have delivered to, or made available for inspection by, the
Investor true, correct and complete copies of each Contract set forth in Section 3.17(a) of
the DC Contributors Disclosure Schedule (or required by Section 3.17(a) to
be set forth thereon) (all such Contracts required to be listed in Section 3.17(a)
of the DC Contributors Disclosure Schedule, together with any such Contracts
entered into after the date of this Agreement that would have been required to
be listed in Section 3.17(a) of the DC Contributors Disclosure
Schedule had such Contracts been entered into on or prior to the date of this
Agreement, collectively, the “Company Contracts”).

 

48

 

(c)           Except as set forth in Section 3.17(c) of
the DC Contributors Disclosure Schedule, each Company Contract entered into on
or prior to the date of the Agreement (i) is a valid and binding
obligation of the Company or a Company Subsidiary that is a party thereto,
enforceable against such Person in accordance with its terms, subject to the
effect of any applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors’ rights generally and subject to the effect of
general principles of equity (regardless of whether considered in a proceeding
at law or in equity), (ii) to the DC Contributors’ Knowledge, is a valid
and binding obligation of each other party thereto, enforceable against each
such other party in accordance with its terms, subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors’ rights generally and subject to the effect of general
principles of equity (regardless of whether considered in a proceeding at law
or in equity), (iii) is in full force and effect, and (iv) upon
consummation of the transactions contemplated by this Agreement, except to the
extent that any consents with respect to such Company Contract set forth in Section 3.04
of the DC Contributors Disclosure Schedule are not obtained, shall continue in
full force and effect without material penalty or other materially adverse
consequence.

 

(d)           Except as set forth in Section 3.17(d) of
the DC Contributors Disclosure Schedule and except as would not result in a
Company Material Adverse Effect, each of the Company and the Company
Subsidiaries that is a party to a Company Contract has in all material respects
performed, or is now performing in all material respects, its obligations under
such Company Contract, and has not and, to the DC Contributors’ Knowledge, none
of the other parties thereto has, violated any provision of, or committed or
failed to perform any action, and no event or condition exists, that would
constitute a default under such Company Contract (and would not be with the
lapse of time or the giving of notice be in default), and has not received from
any other party thereto any notice of such party’s intention to cancel,
terminate or fail to renew any Company Contract.

 

SECTION 3.18.  Company Products.  (a) As of the date of this Agreement,
except as set forth in Section 3.18(a) of the DC Contributors
Disclosure Schedule, since December 31, 2003 there has not been any
material recall conducted by or on behalf of the Company or any Company
Subsidiary, or any investigation or inquiry by any Governmental Authority,
that, to the Knowledge of the DC Contributors, is reasonably likely to have a
material economic impact, concerning any product designed, manufactured,
processed, installed, sold, provided or placed in the stream of commerce by or
on behalf of the Company or any Company Subsidiary.  Section 3.18(a) of the DC
Contributors Disclosure Schedule, which is true and correct in all material
respects as of the date of this Agreement, sets forth the warranty and recall
and similar related expenses incurred by the Company and the Company
Subsidiaries between December 31, 2003 and March 31, 2007.

 

(b)           As of the date of this
Agreement, except as set forth in Section 3.18(b) of the DC Contributors
Disclosure Schedule, there are no material pending Actions for negligence,
manufacturing negligence or improper workmanship, or material pending Actions
in whole or in part premised upon product liability, against or otherwise
naming as a party the Company, or any Company Subsidiary, or any predecessor in
interest of any of the foregoing Persons, or, to the DC Contributors’
Knowledge, threatened in writing or of which the Company has received written
notice, that involve a product liability claim for personal injuries, property
damage or

 

49

 

losses resulting from the
ownership, possession, or use of any product manufactured, sold or delivered by
the Company, a Company Subsidiary, or a predecessor in interest of any of the
foregoing Persons, which would reasonably be likely to result in a liability of
the Company, or any Company Subsidiary of more than $10 million.  Except as set forth in Section 3.18(b) of
the DC Contributors Disclosure Schedule, neither the Company nor any Company
Subsidiary nor any predecessor in interest of any of the foregoing Persons has
received any reservation of rights or declination of coverage from any insurer
regarding the matters set forth in Section 3.18(b) of the DC
Contributors Disclosure Schedule.

 

SECTION 3.19.  Securitizations.  (a) Each of the Company and the Company
Subsidiaries, to the extent that it is a servicer of any Securitization
Transaction (in such a capacity, a “Securitization Servicer”), is in
compliance in all material respects with all Contracts to which it is bound
under such Securitization Transaction (collectively referred to as the “Securitization
Instruments”).  As of the date of
this Agreement, no Securitization Servicer has received any notice of a
servicer termination event under any Securitization Transaction (and, to the DC
Contributors’ Knowledge, no event has occurred or is continuing that would
reasonably be expected to give rise to any such servicer termination
event).  Each of the Company and the
Company Subsidiaries, to the extent that it is a depositor or issuing entity in
any Securitization Transaction, has performed in all material respects all of
its respective obligations under the Securitization Instruments with respect to
such Securitization Transaction.

 

(b)           Since December 31,
2005, each of the Company and the Company Subsidiaries, to the extent that it
is a depositor in any Securitization Transaction, has made or caused to be made
all filings required to be made by it under the Exchange Act.  There is no Action pending or, to the
Knowledge of the DC Contributors, threatened in writing, in which it is alleged
that any private placement memorandum or other offering document issued in any
Securitization Transaction, or any amendment or supplement thereto, contained,
as of the date on which it was issued, any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading.  No
securities were issued or sold by the Company or any Company Subsidiary in
violation of Section 5 of the Securities Act in any Securitization
Transaction.  Neither the Company nor any
Company Subsidiary nor any Securitization SPV, in each case to the extent that
it is an issuing entity in any Securitization Transaction, is required to
register as an investment company under the Investment Company Act of 1940, as
amended.

 

(c)           Since December 31,
2005, no nationally recognized statistical rating agency has downgraded or
withdrawn its rating of any securities that were rated at least BBB or its
equivalent by any Rating Agency at issuance of any Securitization Transaction
or placed any such ratings on a credit watch for possible downgrade, except for
any such event that has resulted from a downgrade, withdrawal or credit watch
with respect to the credit rating of a third party credit enhancement provider
and except for any such event not caused by the actions or inactions of the
Company or any Company Subsidiary.

 

(d)           No event of default,
servicer default or similar event has occurred under any Securitization
Instrument and no cash trapping trigger event or other event requiring the
increase of credit enhancement for any Securitization Transaction has occurred
(and, to the DC

 

50

 

Contributors’ Knowledge, no
event has occurred or is continuing that would reasonably be expected to give
rise to any of the foregoing events) except (i) as described in Section 3.19(d) of
the DC Contributors Disclosure Schedule, or (ii) any cash trapping trigger
or other event requiring the increase of credit enhancement for any
Securitization Transaction that occurred as a result of the performance of the
related pool of assets.

 

(e)           Except as provided in Section 3.19(e) of
the DC Contributors Disclosure Schedule, neither the Company nor any Company
Subsidiary has acted in the capacity of guarantor or credit enhancer in any
Securitization Transaction, nor has the Company or any Company Subsidiary
provided any type of guaranty in any Securitization Transaction with respect to
any payments of principal and/or interest in connection with any issued
securities; provided, however, that for the purposes of this Section 3.19(e),
neither the Company nor any Company Subsidiary shall be deemed a “guarantor” or
“credit enhancer” solely by reason of owning or holding any credit residual,
subordinate interest, credit reserve account or similar instrument or account
related to any Securitization Transaction.

 

SECTION 3.20.  Derivative Transactions.  Except as would not have a Company Material
Adverse Effect, (i) all Derivative Transactions entered into by the
Company or any Company Subsidiary were entered into in accordance with
applicable rules, regulations and policies of any regulatory authority with
jurisdiction over such Person and (ii) except as modified in order to
address a request of any Rating Agency, all Derivative Transactions and
repurchase or reverse repurchase transactions entered into by the Company or
any Company Subsidiary were entered into in accordance with the investments,
securities, commodities, risk management and other policies, practices and
procedures employed by such Person, and were entered into with counterparties
believed at the time to be financially responsible and able to understand
(either alone or in consultation with their advisers) and to bear the risks of
such Derivative Transactions and repurchase or reverse repurchase
transactions.  Except as would not have a
Company Material Adverse Effect, each of the Company and the Company
Subsidiaries has duly performed all of its obligations under the Derivative
Transactions to which it is a party and under the repurchase or reverse
repurchase transactions to which it is a party to the extent that such
obligations to perform have accrued, and, to the DC Contributors’ Knowledge,
there are no breaches, violations or defaults by any party thereunder.

 

SECTION 3.21.  Investment Securities.  Except as would not have a Company Material
Adverse Effect, each of the Company and the Company Subsidiaries has good title
to all securities owned by it (except those sold under repurchase agreements or
held in any fiduciary or agency capacity), free and clear of any Encumbrance
(other than Permitted Encumbrances), except to the extent such securities or
commodities are pledged in the ordinary course of business to secure
obligations of any of the Company and the Company Subsidiaries.  Such securities are valued on the books of
the Company and the Company Subsidiaries in accordance with the Accounting
Principles in all material respects.  The
Company and the Company Subsidiaries employ investment, securities, risk
management and other policies, practices and procedures which the Company
believes are prudent and reasonable in the context of such businesses in all
material respects.

 

SECTION 3.22.  Sufficiency of Assets.  The tangible assets of each of the Financial
Services Business and Industrial Business are in normal operating condition and
repair,

 

51

 

subject to ordinary wear and
tear, and sufficient for the operation of such business as currently conducted,
except where such instances of noncompliance with the foregoing would not have
a Company Material Adverse Effect.  To
the DC Contributors’ Knowledge, there are no material Omitted Assets or
material Omitted Services.  DCC has
received fair value as consideration for the transfer of all Equity Interests
in FinCo to the Company, which was effected on May 11, 2007 and is
described in Section 3.22 of the DC Contributors Disclosure Schedule.

 

SECTION 3.23.  FinCo/DCC/Guarantor Transition Services.  Except for the services set forth in Section 3.23
of the DC Contributors Disclosure Schedule, the Ancillary Agreements will
provide the Company and the Company Subsidiaries for the periods provided
therein with access to all material services provided as of the date of this
Agreement by the DC Contributors and their Affiliates (other than services
historically provided by the Company and the Company Subsidiaries) to the
Company Business, except for such services as are subsequently made the subject
of an agreement pursuant to Section 5.13. 
To the DC Contributors’ Knowledge, there are no material Omitted Assets
or material Omitted Services.

 

SECTION 3.24.  Certain Business Practices.  The Company and each Company Subsidiary are
in compliance with the legal requirements under the Foreign Corrupt Practices
Act (15 U.S.C. §§ 78dd-1, et seq) (the “FCPA”), except for failures,
whether individually or in the aggregate, to maintain books and records or
internal controls as required thereunder to the extent such failures are not
material.  To the DC Contributors’ Knowledge,
since April 1, 2004, neither the Company, nor any Company Subsidiary, nor
any director, officer, employee or agent thereof, acting on its, his or her own
behalf or on behalf of any of the foregoing Persons, has offered, promised,
authorized the payment of, or paid, any money, or the transfer of anything of
value, directly or indirectly, to or for the benefit of: (x) any employee,
official, agent or other representative of any foreign government or
department, agency or instrumentality thereof, or of any public international
organization; or (y) any foreign political party or official thereof or
candidate for foreign political office for the purpose of influencing any act
or decision of such recipient in the recipient’s official capacity, or inducing
such recipient to use his, her or its influence to affect any act or decision
of such foreign government or department, agency or instrumentality thereof or
of such public international organization, or securing any improper advantage,
in the case of both (x) and (y) above in order to assist the Company
or any Company Subsidiary to obtain or retain business for, or to direct
business to, either the Company or any Company Subsidiary and under
circumstances which would subject the Company or any Company Subsidiary to
material liability under any applicable Laws of the United States (including
the FCPA) or of any foreign jurisdiction where the Company or any Company
Subsidiary does business relating to corruption, bribery, ethical business
conduct, money laundering, political contributions, gifts and gratuities, or
lawful expenses.

 

SECTION 3.25.  Insurance.  The Company and its Subsidiaries, directly or
indirectly through the Guarantor or its Affiliates (other than the Company and
its Subsidiaries), maintain certain policies of casualty and liability
insurance as set forth in Section 3.25 of the DC Contributors Disclosure
Schedule (the “DCC Insurance Policy”) or self-insurance arrangements
with respect to their assets, which policies and arrangements provide reasonably
adequate insurance coverage customary for the industry for the Company and the
Company Subsidiaries, except where such failures to maintain such policies or
arrangements would not have a Company Material Adverse Effect.  Except for such instances as would not have a
Company Material

 

52

 

Adverse Effect, (i) each
DCC Insurance Policy is valid and enforceable and is in full force and effect,
all premiums with respect thereto are currently paid or reserved for, (ii) neither
the Company nor any Company Subsidiary has failed to give notice or present any
claim under any DCC Insurance Policy in due and timely fashion, and (iii) there
are no outstanding material unpaid claims by the Company or any Company Subsidiary
under any DCC Insurance Policy.  To the
DC Contributors’ Knowledge, (i) no basis exists for early termination of
any DCC Insurance Policy on the part of the insurer and (ii) no facts or
circumstances exist which would relieve the insurer under any DCC Insurance
Policy of its obligation to satisfy in full (net of deductibles) any valid
claim of the Company or any Company Subsidiary thereunder, except, in the cases
of items (i) and (ii), such instances thereof as would not have a Company
Material Adverse Effect.

 

SECTION 3.26.  Insurance Regulation.  (a) The DC Contributors have delivered
to the Investor true and complete copies of (i) all material
registrations, filings and submissions made since December 31, 2004 by the
Insurance Subsidiary or the Insurance Agency with any insurance regulatory
authority and (ii) any material reports on financial examination, market
conduct reports and other reports issued since December 31, 2004 by any
insurance regulatory authority that relate to the Insurance Subsidiary.  The Insurance Subsidiary and the Insurance
Agency have filed all material reports, statements, documents, registrations,
filings or submissions required to be filed by them with any insurance
regulatory authority since December 31, 2004, and all such reports,
statements, documents, registrations, filings or submissions were in all
material respects true, complete and accurate when filed, except as set forth
in the notes, exhibits or amendments thereto.

 

(b)           All Insurance Contracts are,
to the extent required under applicable insurance Laws, on forms and at rates
approved by the insurance regulatory authority of the jurisdiction where issued
or, to the extent required by applicable insurance Laws, have been filed with
and not materially objected to by such authority within the period provided for
objection, except for such instances as would not have a Company Material
Adverse Effect.  The Insurance Subsidiary
is not a party to any material finite or similar nontraditional insurance or
reinsurance agreement in writing or side letter agreement related to finite or
similar nontraditional insurance or reinsurance.  Neither the Insurance Subsidiary nor the
Insurance Agency is a party to any written market services agreement, placement
services agreement, or similar agreement providing for the payment of
contingent commissions to any agent, broker, producer or other insurance or
reinsurance intermediary.

 

(c)           To the DC Contributors’
Knowledge, each of the brokers, customer representatives, managing general
agents, solicitors, producers and agents offering, selling or soliciting
insurance products or services for the Insurance Agency (each, an “Insurance
Representative”) is, and has been at all times that such person has acted
as an Insurance Representative for the Insurance Agency, duly registered with
and/or licensed by the appropriate Governmental Authority in jurisdictions
where such Insurance Representative conducts business of a nature requiring
such registration and/or license and has been duly appointed by each entity for
which it offers or sells such products or services, except where such failures
to be so registered, licensed or appointed would not have a Company Material
Adverse Effect.  No Insurance
Representative has violated (with or without notice or the lapse of time or
both) in any material respect any material term or provision of any Law
applicable to the broking, writing,

 

53

 

sale or production of the
business of the Insurance Agency, except for such violations as would not have
a Company Material Adverse Effect.

 

SECTION 3.27.  Cash/Debt Indemnification Amount.  (a) The Entity Cash Amount is the amount
set forth on Schedule 3.27(a) of the DC Contributors Disclosure Schedule.

 

(b)           The Entity Debt Amount is
the amount set forth on Schedule 3.27(b) of the DC Contributors Disclosure
Schedule.

 

SECTION 3.28.  Brokers.  Except for JPMorgan Chase & Co., no
broker, finder or investment banker is entitled to any brokerage, finder’s or
other fee or commission in connection with the transactions contemplated by
this Agreement or the Ancillary Agreements based upon arrangements made by or
on behalf of the DC Contributors.  The DC
Contributors are solely responsible for the fees and expenses of JPMorgan Chase &
Co.

 

SECTION 3.29.  Disclaimer of the DC Contributors.  (a) EXCEPT AS SET FORTH IN THIS ARTICLE
III, NONE OF THE DC CONTRIBUTORS, THEIR AFFILIATES OR ANY OF THEIR RESPECTIVE
OFFICERS, DIRECTORS, EMPLOYEES OR REPRESENTATIVES MAKE OR HAVE MADE ANY OTHER
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT
OF THE COMPANY, THE COMPANY SUBSIDIARIES, THE ASSETS OR LIABILITIES OF THE
COMPANY OR THE COMPANY SUBSIDIARIES OR THE INVESTOR EQUITY INTERESTS, INCLUDING
WITH RESPECT TO (I) MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE,
(II) THE OPERATION OF THE COMPANY BUSINESS BY THE INVESTOR AFTER THE
CLOSING IN ANY MANNER OTHER THAN AS USED AND OPERATED BY THE DC CONTRIBUTORS,
THE COMPANY AND THE COMPANY SUBSIDIARIES, OR (III) THE PROBABLE SUCCESS OR
PROFITABILITY OF THE COMPANY BUSINESS AFTER THE CLOSING.

 

(b)           OTHER THAN THE
INDEMNIFICATION OBLIGATIONS OF THE DC CONTRIBUTORS SET FORTH IN ARTICLES VII
AND IX, NONE OF THE DC CONTRIBUTORS, THEIR AFFILIATES OR ANY OF THEIR
RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES OR REPRESENTATIVES WILL HAVE OR BE
SUBJECT TO ANY LIABILITY OR INDEMNIFICATION OBLIGATION TO THE INVESTOR OR TO
ANY OTHER PERSON RESULTING FROM THE DISTRIBUTION TO THE INVESTOR, ITS
AFFILIATES OR REPRESENTATIVES OF, OR THE INVESTOR’S USE OF, ANY INFORMATION
RELATING TO THE COMPANY BUSINESS, INCLUDING ANY INFORMATION, DOCUMENTS OR
MATERIAL MADE AVAILABLE TO THE INVESTOR, WHETHER ORALLY OR IN WRITING, IN
CERTAIN “DATA ROOMS,” MANAGEMENT PRESENTATIONS, FUNCTIONAL “BREAK-OUT”
DISCUSSIONS, RESPONSES TO QUESTIONS SUBMITTED ON BEHALF OF THE INVESTOR OR IN
ANY OTHER FORM IN EXPECTATION OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT.

 

(c)           THE INVESTOR HAS RECEIVED
AND MAY CONTINUE TO RECEIVE FROM THE DC CONTRIBUTORS, THE COMPANY, THE
COMPANY SUBSIDIARIES AND THEIR RESPECTIVE REPRESENTATIVES CERTAIN ESTIMATES,

 

54

 

PROJECTIONS AND OTHER
FORECASTS FOR THE COMPANY AND THE COMPANY SUBSIDIARIES AND CERTAIN PLAN AND
BUDGET INFORMATION.  THE INVESTOR
ACKNOWLEDGES THAT THESE ESTIMATES, PROJECTIONS, FORECASTS, PLANS AND BUDGETS
AND THE ASSUMPTIONS ON WHICH THEY ARE BASED WERE PREPARED FOR SPECIFIC PURPOSES
AND MAY VARY SIGNIFICANTLY FROM EACH OTHER.  FURTHER, THE INVESTOR ACKNOWLEDGES THAT THERE
ARE UNCERTAINTIES INHERENT IN ATTEMPTING TO MAKE SUCH ESTIMATES, PROJECTIONS,
FORECASTS, PLANS AND BUDGETS, THAT THE INVESTOR IS TAKING FULL RESPONSIBILITY
FOR MAKING ITS OWN EVALUATION OF THE ADEQUACY AND ACCURACY OF ALL ESTIMATES,
PROJECTIONS, FORECASTS, PLANS AND BUDGETS SO FURNISHED TO IT, AND THAT THE
INVESTOR IS NOT RELYING ON ANY ESTIMATES, PROJECTIONS, FORECASTS, PLANS OR
BUDGETS FURNISHED BY THE DC CONTRIBUTORS, THE COMPANY, THE COMPANY SUBSIDIARIES
OR THEIR RESPECTIVE REPRESENTATIVES, AND THE INVESTOR SHALL NOT HOLD ANY SUCH
PERSON LIABLE WITH RESPECT THERETO.  THE
DC CONTRIBUTORS DO NOT MAKE ANY REPRESENTATION OR WARRANTY WITH RESPECT TO ANY
ESTIMATES, PROJECTIONS, FORECASTS, PLANS OR BUDGETS.  ANY SUCH OTHER REPRESENTATION OR WARRANTY IS
HEREBY EXPRESSLY DISCLAIMED BY THE DC CONTRIBUTORS AND WAIVED BY THE INVESTOR.

 

ARTICLE IV

 

REPRESENTATIONS
AND WARRANTIES

OF THE INVESTOR

 

The Investor hereby
represents and warrants to the DC Contributors as follows:

 

SECTION 4.01.  Organization and Authority of the Investor.  The Investor is a limited liability company
duly organized, validly existing and in good standing under the laws of the
State of Delaware and has all necessary limited liability company power and
authority to enter into this Agreement and the Ancillary Agreements to which
the Investor is or will be a party, to carry out its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby and
thereby.  The Investor is duly licensed or
qualified to do business and is in good standing (if such concept is
applicable) in each jurisdiction in which the properties owned or leased by it
or the operation of its business makes such licensing or qualification
necessary, except to the extent that such failures to be so licensed, qualified
or in good standing would not have an Investor Material Adverse Effect.  The execution and delivery by the Investor of
this Agreement and the Ancillary Agreements to which the Investor is or will be
a party, the performance by the Investor of its obligations hereunder and
thereunder and the consummation by the Investor of the transactions
contemplated hereby and thereby have been duly authorized by all requisite
limited liability company action on the part of the Investor and its members.  This Agreement has been, and, upon their
execution, the Ancillary Agreements to which the Investor is or will be a
party, shall have been, duly executed and delivered by the Investor, and
(assuming due authorization, execution and delivery by the other parties hereto
or thereto, as applicable) this Agreement constitutes, and, upon their
execution, the Ancillary Agreements to which the Investor is or will be a
party, shall constitute, legal, valid and binding obligations of the Investor,
enforceable against the Investor in accordance with their respective terms,
subject to the effect of

 

55

 

any applicable bankruptcy,
insolvency (including all Laws relating to fraudulent transfers),
reorganization, moratorium or similar laws affecting creditors’ rights
generally and subject to the effect of general principles of equity (regardless
of whether considered in a proceeding at law or in equity).

 

SECTION 4.02.  No Conflict.  Assuming that all consents, approvals,
authorizations and other actions described in Section 4.03 have been
obtained, all filings and notifications described in Section 4.03 have
been made and any applicable waiting period has expired or been terminated, and
except as may result from any facts or circumstances relating solely to the DC
Contributors, the execution, delivery and performance of this Agreement and the
Ancillary Agreements, to which the Investor is a party, by the Investor do not
and will not (a) violate, conflict with or result in the breach of any provision
of the Fundamental Documents of the Investor, (b) conflict with or violate
any Law or Governmental Order applicable to the Investor or any Subsidiary of
the Investor, (c) except as set forth in Section 4.02 of the Investor
Disclosure Schedule, conflict with, result in any breach of, constitute a
default (or event which with the giving of notice or lapse of time, or both,
would become a default) under, require any consent under, or give to others any
rights of termination, amendment, payment, acceleration, suspension, revocation
or cancellation of, any note, bond, mortgage or indenture, contract, agreement,
lease, sublease, license, permit, franchise or other instrument or arrangement
to which the Investor or any Subsidiary of the Investor is a party or (d) result
in the creation of any Encumbrances upon the assets of the Investor, except, in
the case of each of clauses (b), (c) and (d), as would not, individually
or in the aggregate, have an Investor Material Adverse Effect.

 

SECTION 4.03.  Governmental Consents and Approvals.  The execution, delivery and performance of
this Agreement and each Ancillary Agreement, to which the Investor is a party,
by the Investor do not and will not require any consent, approval,
authorization or other order of, action by, filing with, or notification to,
any Governmental Authority, except (a) as described or required to be
described in Section 3.05 of the DC Contributors Disclosure, (b) the
premerger notification and waiting period requirements of the HSR Act, (c) the
requirements of the Antitrust Laws of any other relevant jurisdiction, except
where failure to obtain such consent, approval, authorization or action, or to
make such filing or notification, would not prevent or materially delay the
consummation by the Investor of the transactions contemplated by this Agreement
and the Ancillary Agreements and would not have an Investor Material Adverse
Effect, or (d) as may be necessary as a result of any facts or
circumstances relating solely to the DC Contributors or any of their Affiliates
(including the Company and the Company Subsidiaries).

 

SECTION 4.04.  Litigation.  As of the date hereof, no Action by or
against the Investor is pending or, to the Knowledge of the Investor,
threatened, which could affect the legality, validity or enforceability of this
Agreement, any Ancillary Agreement or the consummation of the transactions
contemplated hereby or thereby.

 

SECTION 4.05.  Financing.  (a) Assuming the satisfaction of all
conditions to funding set forth in the Equity Financing Commitment, the
Investor will have available on the Closing Date all funds necessary to (i) pay
the Closing Date Cash Contribution and all other amounts payable hereunder, and
(ii) pay any fees and expenses payable by the Investor in connection with
the transactions contemplated hereby on the Closing Date.

 

56

 

(b)           The Investor has delivered
to the DC Contributors true and complete copies (but excluding any fee and
sponsor letters referenced therein) of (i) the commitment letters, dated
as of the date of this Agreement (the “Debt Financing Commitments”),
from the financing sources identified therein, pursuant to which such financing
sources have committed, subject to the terms and conditions thereof, to lend
the amounts set forth therein to the Company and/or certain of the Company
Subsidiaries from and after the Closing (the “Debt Financing”), and (ii) the
equity commitment letter, dated as of the date of this Agreement (the “Equity
Financing Commitment”; and together with the Debt Financing Commitments,
the “Financing Commitments”), pursuant to which Cerberus Capital
Management, L.P., on behalf of certain funds and accounts managed by it and its
Affiliates, has committed, subject to the terms and conditions thereof, to
provide equity financing to the Investor in the aggregate cash amounts set
forth therein for the payment of the amounts referred to in clauses (i) and
(ii) of Section 4.05(a) (the “Equity Financing”).  As of the date of this Agreement, (i) none
of the Financing Commitments has been amended or modified and (ii) the
respective commitments contained in the Financing Commitments have not been
withdrawn or rescinded in any respect. 
The Equity Financing Commitment, in the form so delivered, is in full
force and effect (unless it has terminated, after the date of this Agreement,
in accordance with its terms) and is a legal, valid and binding obligation of
the Investor and the other party thereto. 
Each of the Debt Financing Commitments, in the form so delivered, is in
full force and effect (unless it has terminated, after the date of this
Agreement, in accordance with its terms) and is a legal, valid and binding
obligation of the Investor, to the extent a party thereto, and the other
parties thereto for so long as it remains in full force and effect.  As of the date of this Agreement, to the
Investor’s Knowledge, no event has occurred which, with or without notice,
lapse of time or both, would constitute a default or breach on the part of the
Investor under any term or condition of the Financing Commitments.  To the Investor’s Knowledge, as of the date
of this Agreement, the Investor has no reason to believe that it will be unable
to satisfy on a timely basis any term or condition of closing to be satisfied
by it contained in the Financing Commitments. 
The Investor has fully paid, to the extent due and payable, any and all
commitment fees incurred in connection with the Financing Commitments.  Notwithstanding anything in this Agreement to
the contrary, the Debt Financing Commitments may be superseded after the date
of this Agreement but prior to the Closing Date by new financing commitments
that amend, modify or replace the Debt Financing Commitments (the “New Debt
Financing Commitments”), so long as the New Debt Financing Commitments do
not reduce the aggregate amount of the Debt Financing, do not adversely amend
or expand the conditions to drawdown of the Debt Financing in any respect that
would make such conditions reasonably less likely to be satisfied, and are not
reasonably expected to delay the Closing. 
In the event the Debt Financing Commitments are superseded by New Debt
Financing Commitments, the term “Debt Financing Commitment” as used herein
shall be deemed to mean New Debt Financing Commitments to the extent then in
effect.

 

SECTION 4.06.  Investment Purpose.  The Investor is acquiring the Investor Equity
Interests solely for the purpose of investment and not with a view to, or for
offer or sale in connection with, any distribution thereof other than in
compliance with all applicable Laws, including United States federal securities
laws.  The Investor agrees that the
Investor Equity Interests may not be sold, transferred, offered for sale,
pledged, hypothecated or otherwise disposed of without registration under the
Securities Act and any applicable state securities laws, except pursuant to an
exemption from such registration under the Securities Act and such Laws.  The Investor is able to bear the economic
risk of holding the Investor Equity Interests for an

 

57

 

indefinite period (including
total loss of its investment) and (either alone or together with its advisors)
has sufficient knowledge and experience in financial and business matters so as
to be capable of evaluating the merits and risk of its investment.

 

SECTION 4.07.  Dispositions.  The Investor does not have any current plan
or intention to sell or dispose of the Financial Services Business, the
Industrial Business or any substantial part thereof.

 

SECTION 4.08.  Auburn Hills Entities.  (a) Auburn Hills Mezzanine LLC (“Mezzanine
LLC”) is a Delaware limited liability company and is, and at all times
since its formation has been, treated as disregarded as separate from the
Company for United States federal income tax purposes.  Mezzanine LLC was formed on July 19,
2007 and has not engaged in any business activity other than holding all of the
equity interests in Owner LLC prior to the Closing Date.  All of the equity interests in Mezzanine LLC
are owned by the Company.

 

(b)           Owner LLC is a Delaware
limited liability company and is, and at all times since its formation has
been, treated as disregarded as separate from the Company for United States
federal income tax purposes.  Owner LLC was
formed on July 19, 2007 and has not engaged in any business activity prior
to the Closing Date.

 

SECTION 4.09.  Brokers.  No broker, finder or investment banker is
entitled to any brokerage, finder’s or other fee or commission in connection
with the transactions contemplated by this Agreement or the Ancillary
Agreements based upon arrangements made by or on behalf of the Investor.

 

ARTICLE V

 

ADDITIONAL
AGREEMENTS

 

SECTION 5.01.  Conduct of Business of the Company Prior
to the Closing.  (a) The DC
Contributors covenant and agree that, except for the Pre-Closing Restructuring
Transactions or as described in Section 5.01(a) of the DC
Contributors Disclosure Schedule, between the date hereof and the Closing the
DC Contributors shall cause the Company and each Company Subsidiary to (i) conduct
each of the Financial Services Business and the Industrial Business in the
ordinary course, (ii) use their reasonable efforts to preserve intact in
all material respects the business organization of each of the Financial
Services Business and the Industrial Business, (iii) use their
commercially reasonable efforts to preserve in all material respects the
present relationships of each of the Financial Services Companies and the
Industrial Companies with their respective customers, suppliers and others
having significant business dealings with them, (iv) not take any action
that would reasonably be likely to materially prevent or delay the transactions
contemplated by this Agreement and the Ancillary Agreements, (v) not declare,
make or pay any dividends or distributions (whether in cash, securities or
other property or by allocation of additional Indebtedness to the Company or a
Company Subsidiary without receipt of fair value), other than dividends and
distributions made or paid by any Company Subsidiary (A) solely to either
FinCo, DCC or another Company Subsidiary that is its direct parent (but not to
the Company), or (B) in an amount not in excess of the aggregate amounts
contributed to the Company or any Company Subsidiary after January 1, 2007
in order to effectuate the Pre-

 

58

 

Closing Restructuring
Transactions, and (vi) not take any action to cause any of the DC
Contributors’ representations and warranties set forth in Article III to
be untrue in any material respect as of any such date when such representation
or warranty is made or deemed to be made.

 

(b)           Without limiting the
generality of the provisions of Section 5.01(a), except for the
Pre-Closing Restructuring Transactions performed in accordance with Section 5.05
or as described in Section 5.01(b) of the DC Contributors Disclosure
Schedule or otherwise expressly contemplated by this Agreement, without the
consent of the Investor (which shall not unreasonably be withheld, delayed or
conditioned), between the date hereof and the Closing, the DC Contributors
shall cause the Company and each Company Subsidiary not to:

 

(i)            amend the
Fundamental Documents of the Company or any Company Subsidiary or effect a
split or reclassification or other adjustment of Equity Interests of the
Company or any Company Subsidiary or a recapitalization thereof (in each case
other than pursuant to Section 5.05);

 

(ii)           make any
material change in financial or accounting principles or in the manner of
applying such principles, other than as may be required by the SEC, GAAP, the
Accounting Principles  or
applicable Tax law, or make or revoke any material election relating to Taxes
of the Company or any Company Subsidiary;

 

(iii)          acquire (including by
merger, consolidation, combination or acquisition of Equity Interests or
assets) any Person or business or division thereof (other than acquisitions of
portfolio assets and acquisitions in the ordinary course of business consistent
with past practice) in a transaction (or series of related transactions) where
the aggregate consideration paid or received (including noncash equity
consideration) exceeds $50,000,000, other than transactions among the Company
and the Company Subsidiaries;

 

(iv)          issue, sell, pledge, dispose
of or encumber (except for Permitted Encumbrances described in clause (a) of
the definition thereof), or authorize the issuance, sale, pledge, disposition
or encumbrance of, except to the Company or any of the Company Subsidiaries,
any Equity Interest of the Company or any Company Subsidiary, or any Equity
Interest of, or similar interest in, a joint venture or similar arrangement to
which the Company or a Company Subsidiary is party;

 

(v)           sell, pledge,
dispose of or encumber any assets of the Company and the Company Subsidiaries
(except (A) sales of inventory in the ordinary course of business, (B) sales
of loans, receivables and other assets of the Financial Services Companies in
Securitization Transactions, or otherwise, in the ordinary course of business
or pursuant to Contracts in effect on the date hereof and set forth in Section 3.17(a) of
the DC Contributors Disclosure Schedule, (C) dispositions of obsolete,
nonperforming or worthless assets, (D) individual sales of assets (or a
series of related sales) in arms’-length transactions not in excess of

 

59

 

$25,000,000,
or during any 60-day period, $100,000,000 in the aggregate, and (E) the
creation of Permitted Encumbrances);

 

(vi)          other than as
is required by the terms of an existing Company Benefit Plan or Collective
Bargaining Agreement or as may be required by applicable Law or pursuant to the
Pre-Closing Restructuring Transactions contemplated by Section 5.05 or the
Project X Restructuring, (A) increase the compensation or benefits of any
present or former employee of the Company or any Company Subsidiary (except for
increases in salary or wages in the ordinary course of business consistent with
past practice), (B) grant any severance or termination pay to any present
or former employee of the Company or any Company Subsidiary (except in the
ordinary course of business consistent with past practice), (C) establish,
adopt, enter into, amend or terminate any Company Benefit Plan (except in the
ordinary course of business consistent with past practice), (D) grant any
equity or equity-based awards or (E) increase or promise to increase the
funding under any Company Benefit Plan subject to Title IV of ERISA;

 

(vii)         in the case of
FinCo or any Subsidiary thereof, pay, discharge or satisfy (A) any
Intercompany Indebtedness, except for allocated Intercompany Indebtedness
(financial liabilities) as determined on the Financial Services Business
Carve-Out Basis, as set forth in Note 1 to the December 31, 2006 Financial
Services Business Carve-Out Financial Statements, as modified by the principles
and procedures set forth on Schedule 5.17 (stand-alone procedures), or (B) any
Indebtedness (including Indebtedness permitted to be paid by clause (A)), except
to the extent the aggregate amount of Indebtedness so paid, discharged or
satisfied does not exceed $15 billion in the aggregate;

 

(viii)        in the case of
FinCo or any Subsidiary thereof, except for Indebtedness thereof which is
incurred or created in connection with Securitization Transactions in the
ordinary course of business and not contemplated by Section 8.02(h) to
be refinanced upon the consummation of the transactions contemplated by this
Agreement, incur, create or suffer to exist as of the Closing Date Indebtedness
(including any deemed allocation thereof on the books and records of the DC
Contributors or any of their Affiliates), to the extent that the aggregate
Indebtedness of the Financial Services Companies would exceed $38.5 billion;

 

(ix)           incur
indemnification obligations other than in the ordinary course of business;

 

(x)            [intentionally
omitted];

 

(xi)           except in
accordance with the existing risk policies and limits of the Company and the
Company Subsidiaries as of the date hereof, restructure or change in any
materially adverse respect the gap position of the Company and the Company
Subsidiaries, whether through purchases, sales, hedges, swaps, caps or

 

60

 

collars
or otherwise, or the manner in which any current hedges are classified or
reported;

 

(xii)          alter, whether
through a complete or partial liquidation, dissolution, merger, consolidation,
restructuring, reorganization or in any other manner, the legal structure or
ownership of the Company or any Company Subsidiary or any material joint
venture to which any Company Subsidiary is a party, or adopt or approve a plan
with respect to any of the foregoing (in each case other than pursuant to Section 5.05);

 

(xiii)         revalue in any
material respect any of its assets, including writing-off notes or accounts
receivable other than in the ordinary course of business consistent with past
practice or other than as required by the Accounting Principles;

 

(xiv)        amend or
otherwise modify materially adversely to the Company or any of the Company
Subsidiaries any material Affiliate Contract, material Intercompany Contract or
material Company Contract, or terminate any material Affiliate Contract,
material Intercompany Contract or material Company Contract to the material
adverse detriment of the Company or any of the Company Subsidiaries;

 

(xv)         enter into any
agreement or arrangement that limits or otherwise restricts or that would
reasonably be expected to, after the Closing, restrict or limit (A) the
Company, any of the Company Subsidiaries or any successor thereto, in any
material respect, or (B) any Affiliates of the Company or any successor
thereto (other than the Company or any of the Company Subsidiaries), in the
case of each of clause (A) or (B), from engaging or competing in any line
of business or in any geographic area;

 

(xvi)        take any action
to (A) effect the hiring by the DC Contributors or any Affiliate thereof
(other than the Company and the Company Subsidiaries), or the engagement by any
of such Persons of the services of, on or after the date hereof, any employees
of the Company or the Company Subsidiaries (or any employee contemplated to
become an employee of the Company or the Company Subsidiaries pursuant to the
term sheet for the International Distribution Agreement) designated as grades “96”,
“97” or higher, or any comparable designation of the DC Contributors, or cause
the Company or any of the Company Subsidiaries to hire or engage the services
of, on or after the date hereof any employees of the DC Contributors or any
Affiliate thereof (other than the Company and the Company Subsidiaries)
designated as grades “96”, “97” or higher or any comparable designation of the
DC Contributors, or (B) solicit for employment by the DC Contributors or
any Affiliate thereof (other than the Company and the Company Subsidiaries) any
employees of the Company or the Company Subsidiaries (or any employee
contemplated to become an employee of the Company or the Company Subsidiaries
pursuant to the term sheet for the International Distribution Agreement)
designated as grade “95”, or any

 

61

 

comparable
designation of the DC Contributors, (other than general solicitations of
employment not specifically directed toward Company Employees);

 

(xvii)       cause or permit
asset originations by the Financial Services Business (or any of its units) to
be inconsistent in any materially respect with past practice;

 

(xviii)      dispose of or
fail to keep in effect any rights in, to or for material patents, patent
applications, registered trademarks and service marks, registered copyrights,
and applications therefore included in the Company Intellectual Property or the
DC Contributors Intellectual Property, the loss of which would reasonably be
expected to have a Company Material Adverse Effect;

 

(xix)         enter into any
purchase orders, commitments or agreements, in each case for capital
expenditures of the Company Business, exceeding $100 million in the aggregate
in connection with any single project;

 

(xx)          if such Company
Subsidiary is a Financial Services Company, enter into any material transaction
(or series of related transactions that collectively are material) with any
Industrial Company, or if such Company Subsidiary is an Industrial Company,
enter into any material transaction (or series of related transactions that
collectively are material) with any Financial Services Company, other than (A) pursuant
to a Company Contract set forth in Section 3.17(a) of the DC
Contributors Disclosure Schedule, (B) pursuant to the Pre-Closing
Restructuring Transactions in accordance with Section 5.05 or as otherwise
expressly contemplated by this Agreement, (C) as set forth in Section 5.01(b)(xx)
of the DC Contributors Disclosure Schedule, (D) for the sole purpose of,
and affecting, a bona fide purchase and sale of goods and/or services between
such parties in the ordinary course of business consistent with past practice,
where such purchase and sale is necessary or advisable for the prudent
operation of the Industrial Business and the Financial Services Business
(except to the extent constituting (1) a sale of loans, receivables or
similar obligations, or (2) a transaction in which an equity investment or
capital contribution is being made by a Financial Services Company in an
Industrial Company), or (E) in the ordinary course of business consistent
with past practice;

 

(xxi)         take any action
to permit a significant increase (based on book value) in the ratio of lease
assets to loan assets of the Financial Services Companies at any time relative
to such ratio as of March 31, 2007;

 

(xxii)        defer or fail
to make any cash payments required to be made pursuant to any Company Benefit
Plan (including any Company Benefit Plan with respect to other post-employment
benefits);

 

(xxiii)       make any
material changes in policies or practices of the Insurance Subsidiary relating
to reserving, claims handling or underwriting;

 

62

 

(xxiv)       enter into any Contract
with, or terminate, amend, or otherwise modify any Contract with, the Persons
listed in Section 5.01(b)(xxiv) of the DC Contributors Disclosure Schedule
or any Affiliate thereof;

 

(xxv)        take any action to effect,
or otherwise permit, the offering by the DC Contributors or any Affiliate
thereof (other than the Company and the Company Subsidiaries) of financial
services (including insurance coverage) to dealers in the United States or
Canada and engaged in, or required to be engaged in, the marketing and sale of
vehicles distributed, marketed or sold by the Industrial Companies pursuant to
one or more Contracts with the Company, the Company Subsidiaries or their
licensed distributors; or

 

(xxvi)       agree to take any of the
actions referred to in any of clauses (i) through (xxv) above.

 

SECTION 5.02.  Access to Company Information.  (a) From the date hereof until the
Closing, upon reasonable notice, the DC Contributors shall cause the Company
and each Company Subsidiary and each of their respective officers, directors,
employees, agents, representatives, accountants and counsel to (i) afford
the Investor and its authorized representatives reasonable access to the
personnel, offices, properties and other facilities, and books and records, and
use its reasonable efforts to afford access to accountants, of the Company and
each Company Subsidiary and (ii) prepare and furnish to the officers,
employees, and authorized agents and representatives of the Investor such
additional financial and operating data and other information regarding the Financial
Services Business and the Industrial Business (and regular reports thereon) as
the Investor may from time to time reasonably request; provided, however,
that any such access or furnishing of information shall be conducted at the
Investor’s expense, during normal business hours, under the supervision of any
of the DC Contributors’ personnel and in such a manner as not to materially
interfere with the normal operations of the Financial Services Business or the
Industrial Business, as the case may be. 
In furtherance of the foregoing, following the expiration or termination
of mandatory waiting periods (and any extension thereof) prescribed by the HSR
Act, the Antitrust Laws under Council Regulation (EC) No. 139/2004 of 20 January 2004
and Part IX of the Competition Act (Canada),
the DC Contributors shall cause the Company to provide office space at the
respective headquarters of the Industrial Services Business and the Financial
Services Business for a reasonable number of representatives of the Investor,
together with customary administrative support, so as to enable such
representatives to facilitate the development of the Ancillary Agreements and
to plan for an efficient execution of the transactions contemplated by this
Agreement.  Notwithstanding anything to
the contrary in this Agreement, the DC Contributors shall not be required to
disclose any information to the Investor if such disclosure would, in the DC
Contributors’ reasonable determination, (x) cause significant competitive
harm to the Company Business if the transactions contemplated hereby are not
consummated (provided that, in connection with such determination, the DC
Contributors shall consider reasonable special access procedures in order to
reduce the likelihood of competitive harm resulting from the disclosure of such
information), (y) based on the written advice of outside counsel to the DC
Contributors, violate the attorney client or work product privileges of the DC
Contributors or any of their Affiliates (provided that, in making such
determination, the DC Contributors and such outside counsel shall take into
account the effect on the preservation of such privilege of any joint defense
agreement which the

 

63

 

Investor may propose to enter
into in connection with the disclosure of such information), or (z) contravene
any applicable Law, fiduciary duty or binding agreement of the DC Contributors
or any Affiliates thereof entered into prior to the date hereof (provided that,
to the extent reasonably requested by the Investor, the DC Contributors will
use its commercially reasonable efforts to seek such amendments or waivers as
may be required to avoid such contravention).

 

(b)           In order to facilitate the
resolution of any claims made against or incurred by the DC Contributors
relating to the Company Business, for a period of seven years after the Closing
or, if shorter, the applicable period specified in the Investor’s document
retention policy, as in effect on the date hereof, the Investor shall (i) retain
the books and records relating to the Company Business, the Company and the
Company Subsidiaries relating to periods prior to the Closing, and (ii) upon
reasonable notice, afford the officers, employees, agents and representatives
of either of the DC Contributors reasonable access (including the right to
make, at the DC Contributors’ expense, photocopies), during normal business
hours, to such books and records; provided, however, that the
Investor shall notify the DC Contributors at least 30 days in advance of
destroying any such books and records prior to the seventh anniversary of the
Closing in order to provide the DC Contributors the opportunity to access such
books and records in accordance with this Section 5.02(b).

 

(c)           In order to facilitate the
resolution of any claims made against or incurred by the Investor, the Company
or any Company Subsidiary relating to the Company Business (and in order to
facilitate the preparation of financial statements with respect to the
Financial Services Business or the Industrial Business for one or more periods
ended at or prior to the Closing), for a period of seven years after the
Closing or, if shorter, the applicable period specified in the DC Contributors’
document retention policy, as in effect on the date hereof, the DC Contributors
shall (i) retain the books and records relating to the Company Business,
the Company and the Company Subsidiaries relating to periods prior to the
Closing which shall not otherwise have been delivered to the Investor, the
Company or any Company Subsidiary, and (ii) upon reasonable notice, afford
the officers, employees, agents and representatives of the Investor, the
Company or any Company Subsidiary reasonable access (including the right to
make, at the Investor’s expense, photocopies), during normal business hours, to
such books and records and to the personnel, and use its reasonable efforts to
afford access to accountants, of the Company and Company Subsidiaries; provided,
however, that the DC Contributors shall notify the Investor at least 30
days in advance of destroying any such books and records prior to the seventh
anniversary of the Closing in order to provide the Investor the opportunity to
access such books and records in accordance with this Section 5.02(c).

 

(d)           For a period of two years
after the Closing, the DC Contributors shall cooperate with the Investor, the
Company and the Company Subsidiaries regarding insurance-related matters
concerning the Company Business by submitting, upon request, to their and their
Affiliates’ insurance carriers, and pursuing coverage under their and their
Affiliates’ insurance policies for, all valid claims for losses (net of any and
all applicable deductibles) of the Company Business that have been made prior
to the Closing Date to the extent that they are covered under such insurance
policies that provide coverage for such losses on a claims made or occurrence
basis and making reasonably available to the Investor, the Company and the
Company Subsidiaries those employees of the DC Contributors and their
Affiliates who are reasonably necessary for the submission of such claims, the
pursuit of such insurance coverage or the

 

64

 

defense of any such claims
for such losses.  To the extent that the
Company or any of the Company Subsidiaries is named as an additional insured in
the Guarantor group occurrence-based insurance policies, (i) the coverage
under such policies for occurrences that take place after the Closing Date
shall cease to be effective as of the Closing Date and (ii) the coverage
under such policies for occurrences that take place on or prior to the Closing
Date shall cease to be effective on the second anniversary of the Closing Date;
provided, however, notwithstanding the foregoing, the Company and
the Company Subsidiaries shall not be entitled to coverage under such policies
for occurrences that take place on or prior to the Closing Date unless and
until the amount of valid claims for losses (net of any and all applicable
deductibles) of the Company Business for such occurrences exceeds $100 million
in the aggregate.

 

(e)           Until the Closing, as soon
as available and in any event within 20 Business Days after the end of each
fiscal month of the Company, the DC Contributors shall cause the Company to
deliver to the Investor financial reports that include the categories of
accounts and adjustments detailed in the forms of monthly reports set forth in
Schedule 5.02(e). Until the Closing and within 60 Business Days after the end
of each fiscal quarter of the Company, the DC Contributors shall cause the
Company to deliver to the Investor unaudited financial reports for such fiscal
quarter that include the categories of accounts and adjustments detailed in the
forms of quarterly reports set forth in Schedule 5.02(e) (together with
the reports referred to in the preceding sentence, the “Supplemental
Financial Reports”).

 

(f)            As promptly as practicable
after the date of this Agreement, the DC Contributors shall provide to the
Investor such financial and other information with respect to the Orphan
Subsidiaries as the Investor shall reasonably request and in the event that an
Orphan Subsidiary shall have had a net worth of less than negative $5 million
as of December 31, 2006, the Investor shall be entitled to require that
such Orphan Subsidiary (other than Utility Assets LLC, a Delaware limited
liability company (“Utility Assets”)) not be a Company Subsidiary and
instead be retained by or transferred to the DC Contributors or their Affiliates
(it being understood that Utility Assets is a Company Subsidiary).  None of the DC Contributors, the Guarantor or
any of their respective Affiliates will have or will be subject to any
liability or indemnification obligation to the Investor or any of its
Affiliates based on Section 9.02(b) or on a breach of Section 3.07
or Section 3.27 related to the liabilities reflected on the December 31,
2006 unaudited financial statements of Utility Assets.

 

(g)           The DC Contributors will not
cause, or permit to be caused, changes to the directors’ and officers’
liability insurance policies of the Guarantor and its Affiliates, in each case
as in effect as of Closing, that would prejudice with respect to events prior
to the Closing in any material respect the rights thereunder of any officers or
directors of the Company or any Company Subsidiary who are insured under any
such policies, in each case prior to the Closing.

 

(h)           By not later than June 15,
2007, the DC Contributors shall deliver to the Investors the following:

 

(i)            the unaudited
combined balance sheet of the Industrial Companies as of March 31, 2007
and the related unaudited combined statements of operations and comprehensive
income and cash flows of the Industrial Companies for the fiscal quarter ended March 31,
2007, with comparative statements of the

 

65

 

Industrial Companies as of December 31,
2006, in each case presented on the Industrial Business Carve Out Basis; and

 

(ii)           the unaudited
combined balance sheet of the Financial Services Companies as of March 31,
2007 and the related unaudited combined statements of operations and
comprehensive income and cash flows of the Financial Services Companies for the
fiscal quarter March 31, 2007, with comparative statements of the
Financial Services Companies as of December 31, 2006, in each case
presented on the Financial Services Business Carve Out Basis (the “Unaudited
2007 Financial Services Companies Financial Statements”, and, together with
item (i), the “Unaudited 2007 Company Financial Statements”).

 

(i)            In the event that the
Company reasonably determines that it requires any information (including
information concerning the assets and liabilities to be transferred to National
Sales Companies and the related operations as set forth in the International
Distribution Cooperation Agreement described in Exhibit L, or similar
information) for the preparation of audited or unaudited financial statements
for a period prior to Closing, then the DC Contributors shall take all
necessary actions, and use their best efforts, at their own expense, to (x) make
available to the Company and its representatives such information as may be
required for the preparation of such financial statements (including the
Company Financial Statements, Unaudited Company Financial Statements and
financial statements in respect of subsequent periods prior to Closing) on a
basis which is in compliance with Regulation S-X, and (y) cause the
delivery of such information to the Company and the Investor as soon as
practicable after the Company or the Investor notifies the DC Contributors
about such requirement (except to the extent that the Company’s independent
accounting firm certifies to the DC Contributors or one of their Affiliates
that the making available of such information and such delivery would be
impossible).

 

SECTION 5.03.  Confidentiality.  (a) The terms of the letter agreement
between the Guarantor and Cerberus European Investment LLC dated as of December 20,
2006 (the “Confidentiality Agreement”) are hereby incorporated herein by
reference and shall continue in full force and effect until the Closing, at
which time the Confidentiality Agreement and the obligations of the Guarantor
and Investor under this Section 5.03 shall terminate; provided, however,
that the Confidentiality Agreement shall terminate only in respect of that
portion of the Confidential Information (as defined in the Confidentiality
Agreement) exclusively relating to the transactions contemplated by this
Agreement.  If this Agreement is, for any
reason, terminated prior to the Closing, the Confidentiality Agreement shall
nonetheless continue in full force and effect.

 

(b)           Nothing provided to the
Investor pursuant to Section 5.02 shall in any way amend or diminish the
Investor’s obligations under the Confidentiality Agreement.  The Investor acknowledges and agrees that any
information provided to the Investor pursuant to Section 5.02(a) or
otherwise by the DC Contributors, the Company, any Company Subsidiary or any
officer, director, employee, agent, representative, accountant or counsel
thereof shall be subject to the terms and conditions of the Confidentiality
Agreement.

 

66

 

(c)           Notwithstanding the
foregoing or any other provision of this Agreement, either the Investor or the
DC Contributors may provide to representatives of labor organizations
representing Company Employees notice of the transactions contemplated by this
Agreement, a copy of this Agreement, and such additional information,
documents, and materials (the “Information”) as it determines is
reasonably necessary to satisfy any legal or contractual obligations related to
collective bargaining or its relationship with any labor organization but only
in the event either of the following occurs: 
(i) the other party gives its prior written consent to such
disclosure (which consent shall not be unreasonably withheld, conditioned or
delayed after the notifying party’s request); or (ii) to comply with a
determination by a court or agency of competent jurisdiction.  In either case, the notifying party will, to
the extent reasonably practicable and permitted by Law, use commercially
reasonable efforts to procure a confidentiality agreement with respect to the
Information in form and substance reasonably satisfactory to the other
party.  In no event shall a party be
precluded hereby from disclosing any Information to any labor organization if a
Regional Office of the National Labor Relations Board determines after an
investigation to issue a complaint alleging that the party has violated the
National Labor Relations Act by failing to provide the Information (in which
event the DC Contributors will give the Investor as much prior written notice
as practicable before releasing such Information).

 

SECTION 5.04.  Regulatory and Other Authorizations;
Notices and Consents.  (a) Each
of the Investor, the DC Contributors and the Company shall, and shall cause
each of their respective Affiliates to, use its best efforts to promptly obtain
all authorizations, consents, orders and approvals of all Governmental
Authorities and officials that may be or become necessary for its execution and
delivery of, and the performance of its obligations pursuant to, this Agreement
and the Ancillary Agreements and will cooperate fully with each other in
promptly seeking to obtain all such authorizations, consents, orders and
approvals.

 

(b)           The DC Contributors and the
Investor agree to make as promptly as practicable their respective filings, if
necessary, pursuant to the HSR Act with respect to the transactions
contemplated by this Agreement, and to supply as promptly as practicable to the
appropriate Governmental Authorities any additional information and documentary
material that may be requested pursuant to the HSR Act.

 

(c)           The Investor and DC
Contributors agree to make as promptly as practicable their respective filings
and notifications, if any, under any other applicable Antitrust Law and to
supply as promptly as practicable to the appropriate Governmental Authorities
any additional information and documentary material that may be requested
pursuant to the applicable Antitrust Law.

 

(d)           The Investor and the DC
Contributors shall promptly notify the other party of any communication it or
any of its Affiliates receives from any Governmental Authority relating to the
matters that are the subject of this Agreement and permit the other party to
review in advance any proposed substantive communication by such party to any
Governmental Authority.  Neither the
Investor nor the DC Contributors shall agree to participate in any meeting with
any Governmental Authority in respect of any filings, investigation (including
any settlement of the investigation), litigation or other inquiry unless it
consults with the other party in advance and, to the extent permitted by such
Governmental Authority, gives the other party

 

67

 

the opportunity to attend
and participate at such meeting.  The
Investor and the DC Contributors will coordinate and cooperate fully with each
other in exchanging such information and providing such assistance as the other
party may reasonably request in connection with the foregoing and in seeking
early termination of any applicable waiting periods, including under the HSR
Act.  The Investor and the DC
Contributors will provide each other with copies of all correspondence, filings
or communications between them or any of their representatives, on the one
hand, and any Governmental Authority or members of its staff, on the other
hand, with respect to this Agreement and the transactions contemplated by this
Agreement.

 

(e)           The DC Contributors shall
not be required to pay any fees or other payments to any Governmental
Authorities in order to obtain any such authorization, consent, order or
approval (other than normal filing fees that are imposed by Law on the DC
Contributors), and in the event that any fees in addition to normal filing fees
imposed by Law may be required to obtain any such authorization, consent, order
or approval, such fees shall be for the account of the Investor.

 

SECTION 5.05.   Restructuring Transactions.  (a) The DC Contributors shall, and shall
cause the Company and the respective Company Subsidiaries to, take the actions
described in Schedule 5.05(a) (the “Pre-Closing Restructuring
Transactions”) prior to the Closing. 
The Pre-Closing Restructuring Transactions shall be implemented
substantially in the manner specified on such Schedule or otherwise in a manner
reasonably satisfactory to the Investor. 
The DC Contributors shall regularly consult with the Investor regarding
the manner and status of the implementation of the Pre-Closing Restructuring
Transactions and shall provide the Investor with copies of all material
agreements or other documents executed in connection with such transactions.

 

(b)           The DC Contributors and the
Investor shall, and shall cause their respective Affiliates to, take the
actions described in Schedule 5.05(b) (the “Post-Closing Restructuring
Transactions”) after the Closing. 
The Investor and the DC Contributors shall cooperate with each other and
shall cause their respective Affiliates and the officers, employees, agents,
and representatives of themselves and their respective Affiliates to cooperate
with each other and use reasonable best efforts to ensure the timely and
orderly completion of the Post-Closing Restructuring Transactions.

 

(c)           (i)  Notwithstanding
anything that may be contained in the NAFTA Macro Step Plan, the Austria Macro
Step Plan or the ROW Macro Step Plan (each as included in Schedule 5.05(a)) to
the contrary, but subject to paragraph (iii) below, the DC Contributors
and the Investor agree that the Pre-Closing Restructuring Transactions, taken
as a whole, will not involve transfers of cash from the Company and the Company
Subsidiaries, taken as a whole, in excess of the amount of cash transferred
pursuant to such step plans by DC Holding, DCNAF and the Guarantor or their
Affiliates (excluding the Company or any Company Subsidiary) to the Company and
the Company Subsidiaries, taken as a whole.

 

(ii) 
The parties agree that in Step 3 of Phase II of the ROW Macro Step Plan, the
amount to be invested by DCC in Chrysler do Brazil Ltda (indicated as $35
million but potentially less) shall be provided to DCC from funds distributed
by Chrysler International

 

68

 

Corporation, a Delaware
corporation (“CIC”), as described in paragraph (iii) below (or by
capital contributions from DCNAF or DC Holding).

 

(iii) The
parties agree that as a result of the steps in Phase II of the Austria Macro
Step Plan (as included in Schedule 5.05(a)), all net cash and cash equivalents
not attributable to the Chrysler business (as defined below) may be paid,
distributed or otherwise transferred from DaimlerChrysler Holding (Austria)
GmbH, DaimlerChrysler Vienna GmbH and CIC, to DaimlerChrysler Danubia (or, in
the case of the distribution from CIC, to the extent not applied as set forth
in paragraph (ii) above, to DC Holding). 
For purposes of this paragraph (iii), net cash and cash equivalents not
attributable to the Chrysler business shall include all cash and cash
equivalents in DaimlerChrysler Holding (Austria) GmbH and DaimlerChryslerVienna
GmbH immediately prior to Step 6 of the Austria Macro Step Plan, which cash and
cash equivalents will not exceed Euro 350 million and which cash and cash
equivalents has not been generated by or is not attributable to any Chrysler
business operations or assets.  For
avoidance of doubt, neither DaimlerChrysler Danubia nor DC Holding shall be
entitled to receive any cash and cash equivalents contained in Chrysler Austria
GmbH, DaimlerChrysler Management Austria GmbH or AC Auto Car, which cash and
cash equivalents balances shall be deemed attributable to the Chrysler
business.

 

SECTION 5.06.  Intellectual Property Agreements.  At the Closing, (a) the DC Contributors
shall cause the Guarantor to license and assign to the Company and/or its
Subsidiaries the DC Contributors Intellectual Property, and (b) the
Investor shall cause the Company, and where necessary, shall cause the Company
Subsidiaries, to, license and assign to the Guarantor and/or its Affiliates the
Licensed Transferred Intellectual Property, all of the foregoing pursuant to
the Technology Sharing Agreement and the Trademark Agreement.

 

SECTION 5.07.  Notifications.  Until the Closing, the DC Contributors and
the Investor shall promptly give the other parties reasonably detailed written
notice of any fact, change, condition, circumstance or occurrence or
nonoccurrence of any event of which it is aware that will or is reasonably
likely to result in any of the conditions set forth in Article VIII of
this Agreement relating to a representation or covenant of such notifying party
or a condition to closing under this Agreement of the other party relating to
the notifying party becoming incapable of being satisfied.

 

SECTION 5.08.  Credit Support Instruments.

 

(a)           The DC
Contributors and the Investor acknowledge that the DC Contributors and certain
of their Affiliates (other than the Company and the Company Subsidiaries) have
provided certain guaranties or arranged certain letters of credit or other
credit support instruments to support certain obligations related to the
Company and the Company Subsidiaries as set forth on Schedule 5.08(a) (collectively,
the “DC Contributors Credit Support Instruments”).  Prior to or concurrently with the Closing,
the Investor shall use its commercially reasonable efforts to cause each of the
DC Contributors Credit Support Instruments to be released, terminated or
returned or to provide letters of credit, cash collateral or other credit
support in favor of the DC Contributors or their Affiliates, as the case may
be, in each case reasonably satisfactory to the DC Contributors, in support of
all DC Contributors Credit Support Instruments which shall not have been so
released, terminated or returned.

 

69

 

(b)           After the Closing, the
Investor shall continue its commercially reasonable efforts to cause the
letters of credit set forth on Schedule 5.08(b)(i) to be provided to the
beneficiaries set forth on Schedule 5.08(b)(i) as soon as
practicable.  Following the Closing, the
Investor shall continue to, and shall cause the Company and each relevant
Company Subsidiary to, use its commercially reasonable efforts to cause each of
the letters of credit or other credit support instruments to support certain
obligations related to the Company and the Company Subsidiaries set forth on
Schedule 5.08(b)(ii) to be released, terminated or returned.

 

(c)           The DC Contributors and the
Investor acknowledge that the Company and the Company Subsidiaries have
provided certain guaranties or indemnities to support surety bonds issued by
third parties in connection with certain obligations of the DC Contributors and
certain of their Affiliates (other than the Company and the Company
Subsidiaries) (collectively, the “Company Credit Support Instruments”).  Prior to or concurrently with the Closing,
the DC Contributors shall (i) use their commercially reasonable efforts to
cause each of the Company Credit Support Instruments to be released or
terminated and (ii) if not released or terminated, to provide
indemnification agreements of the Guarantor in favor of the Company or the
applicable Company Subsidiaries, as the case may be, in each case reasonably
satisfactory to the Investor, in support of all Company Credit Support
Instruments which shall not have been so released or terminated.

 

SECTION 5.09.  Termination of Affiliate Contracts.  Except as set forth in this Agreement, on
Schedule 5.05(a) or on Schedule 5.09 and except as agreed to in writing by
the DC Contributors and the Investor, all Contracts between (a) the
Company or any Company Subsidiary, on one hand, and (b) the DC
Contributors and their Affiliates (other than the Company and the Company
Subsidiaries) on the other hand (each, an “Affiliate Contract”), and any
oral contracts, agreements or understandings between (x) the Company or
any Company Subsidiary, on one hand, and (y) the DC Contributors and their
Affiliates (other than the Company and the Company Subsidiaries) on the other
hand, shall terminate at the Closing without any further action on the part of
the parties hereto or thereto.

 

SECTION 5.10.  Financing Assistance.  The DC Contributors shall take, or cause the
Company and the Company Subsidiaries to take, subject to reimbursement of all
reasonable out-of-pocket expenses by the Investor, all such other action as
shall be reasonably requested by the Investor and is necessary or customary in
order to enable the Investor and, if applicable, one or more of its Affiliates
to consummate, simultaneously with the Closing, such financing as the Investor
may desire in connection with the transactions contemplated hereby (the “Financing”).  Without limiting the foregoing, the DC
Contributors shall, and shall cause its Affiliates, subject to reimbursement of
all reasonable out-of-pocket expenses by the Investor, to, (i) if
requested by, and together with, the Investor, use commercially reasonable
efforts to assist in the preparation of an information memorandum, including
any pro forma financial statements and the “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” section to be
included therein, (ii) deliver such statistical information relating to
the Company Business as may be reasonably requested in connection with the
Financing and reasonably promptly respond to any diligence inquiries of the
underwriters of, or investment banks engaged for, and/or the lenders of the
Financing, (iii) make the officers and employees of the Company and the
Company Subsidiaries reasonably available to participate in diligence sessions,
drafting sessions, road shows and presentations for the Financing, and (iv) request
their independent

 

70

 

auditors to issue customary
comfort letters and provide consents and other services that are reasonably
required to the investment banks engaged for the Financing.  Notwithstanding any other provision of this
Agreement, the Investor shall indemnify and hold harmless from any liability
incurred by each of the DC Contributors, their Affiliates and its and their officers
and employees in connection with its and their obligations pursuant to this Section 5.10.

 

SECTION 5.11.  Further Action.  (a) Subject to Section 5.04, the DC
Contributors and the Investor shall use all reasonable best efforts to take, or
cause to be taken, all appropriate action, to do or cause to be done all things
necessary, proper or advisable under applicable Law, and to execute and deliver
such documents and other papers, as may be required to carry out the provisions
of this Agreement and consummate and make effective the transactions
contemplated by this Agreement.  Without
limiting the generality of the foregoing, the “reasonable best efforts” of the
parties shall include such parties’ agreement (i) to reasonably cooperate
in good faith with the other parties in obtaining, and taking such action as
may be reasonably necessary to obtain, the agreement of any Governmental
Authority to approve, or not to seek an injunction against or otherwise oppose,
the transactions contemplated hereby and (ii) to litigate, pursue or
defend against any administrative or judicial action or proceeding (including
any temporary restraining order or preliminary injunction) challenging any of
the transactions contemplated hereby as violative of any Antitrust Law; provided,
however, that, subject to Section 10.02(b), nothing contained in
this Section 5.11 or elsewhere in this Agreement, including the Investor’s
“best efforts” obligations in Section 5.04, will require the Investor or
any of its Affiliates to agree to sell, divest, dispose of or hold separate any
assets or businesses, or otherwise take or commit to take any action that
limits its ability to retain, one or more of its businesses, product lines or
assets.

 

(b)           The parties shall negotiate
the forms, terms and conditions of the Ancillary Agreements, to the extent the
forms thereof are not attached to this Agreement, on the basis of the
respective term sheets attached to this Agreement, in good faith, with such
Ancillary Agreements to set forth arms’-length terms and incorporate usual and
customary provisions for similar agreements.

 

(c)           If the parties have not
executed any such Ancillary Agreement by the Closing Date, the parties shall
use their best efforts to negotiate and execute such Ancillary Agreements
within 60 days of the Closing Date.  If the
parties do not execute any Ancillary Agreement on or before the day that is 60
days after Closing, the parties shall submit the items remaining in dispute for
resolution to the Joint Automotive Council; provided, however to
the extent any item is set forth in the term sheets attached to this Agreement,
such terms shall be deemed to be agreed by the parties and shall not be the
subject of review by the Joint Automotive Council.  The parties shall instruct the Joint Automotive
Council to resolve any such dispute within 30 days after such submission.  The determination of the Joint Automotive
Council shall be binding upon the parties, and the parties shall promptly
execute such Ancillary Agreement following such determination.  During the period following the Closing Date
until any such Ancillary Agreement is executed, the parties shall, and shall
cause their Affiliates to, provide the products or services that are the
subject matter of such Ancillary Agreement. 
Pricing for services provided during such period shall be at cost plus
1%.  Pricing for products supplied during
such period shall be the lesser of (i) market price (determined by
reference to prices for comparable products offered by other participants in
the industry) and (ii) the historic price charged by the

 

71

 

provider for such products
prior to Closing plus 1%.  The respective
term sheet for the subject matter to be covered by such Ancillary Agreement
shall govern the parties’ rights and obligations with respect to such subject
matter until the respective Ancillary Agreement has been executed.

 

SECTION 5.12.  Contingent Value Right.  (a) If on or prior to the second
anniversary of the Closing Date,

 

(i)            a Business Sale Transaction
has been consummated; or

 

(ii)           the Company,
the Investor or any of their respective Affiliates or successors enters into an
agreement that results in the consummation of a Business Sale Transaction
within one year from the date of such agreement,

 

then the Investor shall pay
to the DC Contributors or any entity designated by the DC Contributors,
promptly following the receipt of the net proceeds by the Investor, its
successor or any Affiliate of the Investor or its successor (collectively, the “Investor
Group”) in respect of such Business Sale Transaction, an aggregate amount
equal to 15% of the excess, if any, of (A) the net proceeds received by
the Investor Group from such Business Sale Transaction over (B) 150% of
the Closing Date Cash Contribution. To the extent that the proceeds in respect
of a Business Sale Transaction are paid to the Company, the Investor or their
Affiliates or successors in cash, the amount payable to the DC Contributors
under this Section 5.12(a) shall likewise be payable in cash, by wire
transfer of immediately available funds to an account designated by the DC
Contributors.  To the extent that any
proceeds are paid to the Company, the Investor or their Affiliates or
successors other than in cash (“Non-Cash Proceeds”), such Non-Cash
Proceeds shall be valued at their fair market value as determined by the
independent directors of the Company or an independent appraiser selected by
them; and (at the payor’s option) the portion of the aggregate amount payable
to the DC Contributors under this Section 5.12(a) that is allocable
to Non-Cash Proceeds may be paid to the DC Contributors either (A) in
cash, based on the fair market value of the relevant Non-Cash Proceeds or (B) by
delivery of a portion of such Non-Cash Proceeds, determined by reference to the
fair market value thereof.

 

(b)           If, on or prior to the
second anniversary of the Closing Date, (i) a Partial Realization
Transaction has been consummated, (ii) the Investor Group has received
proceeds in respect of such Partial Realization Transaction, and (iii) no
Business Sale Transaction or Initial Public Offering of the Company shall have
been consummated, then the Investor shall pay to the DC Contributors or any
entity designated by the DC Contributors, as soon as practicable following the
second anniversary of the Closing Date (or, if later, the date on which net
proceeds are actually received), an aggregate amount equal to 15% of the
excess, if any, of (A) (1) the amount of net proceeds received by the
Investor Group from any Partial Realization Transactions completed on or prior
to such second anniversary date, plus (2) the Per Unit Value
Invested in respect of the Investor Equity Interests that are still owned by
the Investors or its Affiliates on the second anniversary date, over (B) 150%
of the Closing Date Cash Contribution. To the extent that the proceeds in
respect of a Partial Realization Transaction are paid to the Company, the
Investor or their Affiliates or successors in cash, the amount payable to the
DC Contributors under this Section 5.12(b) shall likewise be payable
in cash, by wire transfer of immediately available funds to an account
designated by the DC Contributors.  To
the extent that any Non-

 

72

 

Cash Proceeds are paid to
the Company, the Investor or their Affiliates or successors in respect of a
Partial Realization Transaction, such Non-Cash Proceeds shall be valued at
their fair market value as determined by the independent directors of the
Company or an independent appraiser selected by them; and (at the payor’s
option) the portion of the aggregate amount payable to the DC Contributors
under this Section 5.12(b) that is allocable to Non-Cash Proceeds may
be paid to the DC Contributors either (A) in cash, based on the fair
market value of the relevant Non-Cash Proceeds or (B) by delivery of a
portion of such Non-Cash Proceeds, determined by reference to the fair market
value thereof.

 

(c)           If, on or prior to the
second anniversary of the Closing Date, an Initial Public Offering is consummated
in respect of the Company or any successor (and no Business Sale Transaction
has been consummated), then, as soon as reasonably practicable following such
anniversary, a special allocation shall be made pursuant to the LLC Operating
Agreement in favor of the DC Contributors such that the DC Contributors shall
be entitled to receive, in addition to any distributions to which they may be
entitled as owners of Company Equity Interests, an aggregate amount equal to
15% of the excess, if any, of (i)(A) the fair market value, as of such
second anniversary date, of all the Investor Equity Interests still held by the
Investor Group as of such date, plus (B) the amount of net proceeds
received by the Investor Group, on or prior to such second anniversary date,
from any Partial Realization Transactions, plus (C) the amount of
all Eligible Distributions received by the Investor Group, over (ii) 150%
of the Closing Date Cash Contribution. 
If after the date hereof the Company is organized other than as a
limited liability company, for the purpose of implementing this Section 5.12(c),
the parties shall agree on appropriate arrangements that result in the transfer
to the DC Contributors of gross value that is equivalent to the amount that
would have been subject to the special allocation described above if the
Company had remained a limited liability company (e.g., if the Company has
converted to a corporation in connection with an Initial Public Offering, this Section 5.12(c) will
result in the transfer of shares of such corporation from the Investor Group to
the DC Contributors, such shares to be valued based on their fair market value,
as of the second anniversary date, as determined in the manner set forth
below).  For purposes hereof, the “fair
market value” of the Company Equity Interests and the Investor Equity Interests
shall be determined based on the average Closing Price for the Company’s
securities for the thirty consecutive trading days ended on the trading day
immediately prior to such second anniversary date.  The LLC Operating Agreement shall contain
provisions that effectuate the foregoing provisions of this paragraph.

 

SECTION 5.13.  Omitted Assets and Services.  (a) With respect to any asset, right,
privilege, contract, permit or arrangement in the possession of the DC
Contributors or their Affiliates that materially benefits, or is utilized for
any material purpose in, the Company Business as conducted (other than any
asset, right, privilege, contract, permit or arrangement that was subject of an
arrangement between the Company or a Company Subsidiary, on one hand, and a DC
Contributor or one of its Affiliates, on the other hand, which has been
terminated on or prior to the Closing Date and after giving effect to the
Pre-Closing Restructuring Transactions, the consummation of the contributions
described in Section 2.03, the Post-Closing Restructuring Transactions,
and the Project X Restructuring (to the extent effected)) from January 1,
2007 through the Closing and as to which neither the Company nor any of the
Company Subsidiaries have direct ownership or a contract right to continue use
or ownership thereof following the consummation of the transactions
contemplated by this Agreement (including the Pre-Closing

 

73

 

and Post-Closing
Restructuring Transactions) (collectively, the “Omitted Assets”), the DC
Contributors shall in good faith effect at their own expense the transfer or
license of the Omitted Assets to the Company or one or more Company
Subsidiaries as designated by the Investor as promptly as reasonably
practicable.

 

(b)           With respect to access to
any services provided by the DC Contributors and their Affiliates (other than
services historically provided by the Company and the Company Subsidiaries) to
the Company Business as conducted (after giving effect to the Pre-Closing
Restructuring Transactions, the consummation of the contributions described in Section 2.03,
the Post-Closing Restructuring Transactions, and the Project X Restructuring
(to the extent effected)) from January 1, 2006 through the Closing that
are not either (i) set forth in Section 3.23 of the DC Contributors
Disclosure Schedule, (ii) provided pursuant to the Ancillary Agreements or
(iii) subsequently made the subject of an agreement (collectively, the “Omitted
Services”), the DC Contributors shall commence providing the Omitted
Services to the Company or one or more Company Subsidiaries as designated by
the Investor as promptly as reasonably practicable on terms and conditions to
be negotiated in good faith subject to the provisions of Section 5.11(c), provided,
however that if any Ancillary Agreement (or if any Ancillary Agreement
has not been executed and delivered, then the related term sheet) provides
otherwise, the terms of the Ancillary Agreement (or the related term sheet)
shall prevail.

 

SECTION 5.14.  Leased Portfolio and Like-Kind Exchange
Program.  The Company shall be
subject to restrictions on (a) the transfer of vehicles in the Leased
Portfolio and (b) the discontinuance of the Like-Kind Exchange Program as
shall be provided in the LLC Operating Agreement in a manner consistent with
the LLC Operating Agreement Term Sheet.

 

SECTION 5.15.  Treatment of DCC Debt.  (a) The DC Contributors shall cause DCC
to (i) as promptly as possible (but in any event within 10 Business Days)
following the date of this Agreement, issue a notice (the “Redemption Notice”)
of optional redemption (the “Redemption”) for all of the 7.45%
Debentures due 2027 (the “2027 Debentures”), the 7.45% Debentures due
2097 (the “7.45% 2097 Debentures”) and the 7.40% Debentures due 2097
(the “7.40% 2097 Debentures” and, together with the 2027 Debentures and
the 7.45% 2097 Debentures, the “Debentures”) issued pursuant to an
indenture, dated as of March 1, 1985 (as amended and supplemented, the “Debenture
Indenture”), among DCC, the Guarantor, as guarantor, and U.S. Bank N.A., as
successor trustee (the “Trustee”), pursuant to the requisite provisions of the
Debenture Indenture and the terms of each of the Debentures, (ii) on or
prior to the date set for Redemption in the Redemption Notice, irrevocably
deposit with the Trustee funds sufficient to pay the redemption price for each
Debenture, as described in the Notice of Redemption (the “Redemption Payment”);
provided that on or prior to the Closing Date, the DC Contributors shall
reimburse DCC for such portion of the Redemption Payment in excess of the sum
of the aggregate principal amount of all the Debentures plus the accrued and
unpaid interest on the Debentures to the date set for the Redemption (which
reimbursement may be effected through the cancellation of Intercompany
Indebtedness) and (iii) have taken all action necessary pursuant to the
Debenture Indenture and the Debentures in connection with the Redemption.

 

(b)           The DC Contributors shall
cause DCC (a) following the date of this Agreement, to issue a notice of
exchange (the “Exchange Notice”) pursuant to the terms of the Auburn
Hills Trust Agreement, dated as of May 1, 1990 (as amended and
supplemented, the

 

74

 

“Trust Agreement”),
among DCC, the Guarantor, as guarantor, and The Bank of New York Trust Company
NA, as trustee (the “Auburn Hills Trustee”) to exchange (the “Exchange”)
the Auburn Hills Trust Guaranteed Exchangeable Certificates due 2020 (the “Certificates”),
issued pursuant the Trust Agreement, into debentures (the “Exchange
Debentures”) to be issued by DCC under the Debenture Indenture, pursuant to
the terms of the Trust Agreement and the Debenture Indenture; provided that
such Exchange Notice shall set a date no later than June 30, 2007, as the
date for the Exchange, (b) to take all actions necessary under the Trust
Agreement and the Debenture Indenture to effect the Exchange and (c) to
immediately following the completion of the Exchange (i) at or prior to
the Closing, take all actions necessary to cause, and use its commercially
reasonable efforts to cause the Auburn Hills Trustee to cause the satisfaction
and discharge of the Trust Agreement, in accordance with Section 401 of
the Trust Agreement; (ii) at or prior to the Closing, use its commercially
reasonable efforts to cause the Auburn Hills Trustee to convey record title to
the Property (as defined in the Trust Agreement), as more particularly described
in Section 5.15(b) of the DC Contributors Disclosure Schedule (the “Auburn
Hills Property”), to DCC, in accordance with Section 403 of the Trust
Agreement; and (iii) take any additional actions as may be required by the
Auburn Hills Trustee under the Trust Agreement to effectuate (i) and (ii) above.  In addition, the DC Contributors shall take,
or cause the Company and the Company Subsidiaries to take, prior to the
Closing, all such action as shall be reasonably requested by the Investor to
consummate, simultaneously with the Closing, such financing as the Investor may
desire in connection with the purchase of the Auburn Hills Property, including,
but not limited to, Phase I environmental site assessments, field audits,
appraisals and title insurance with respect to the real property.

 

(c)           The DC Contributors shall
cause DCC to commence an offer to purchase and related consent solicitation
(which consent solicitation shall include a solicitation of consents to remove,
among other things, the lien covenant in the Certificates and/or Debentures)
with respect to any and all of the outstanding aggregate principal amount of
Certificates and/or Exchange Debentures (the “Debt Offer”).  Unless extended, the expiration of the Debt
Offer shall be no later than July 15, 2007.  The DC Contributors shall cause DCC to
prepare all necessary and appropriate documentation in connection with the Debt
Offer, including the offer to purchase, related letter of transmittal and other
related documents used in the Debt Offer (the “Offer Documents”).  The Offer Documents (including all amendments
or supplements) and all mailings to the holders of the Certificates or the
Exchange Debentures in connection with the Debt Offer shall be subject to the
prior review of, and comment by, the Investor, which shall be completed
promptly, and shall be reasonably acceptable to the Investor.

 

(d)           The DC Contributors shall
cause DCC and its Subsidiaries to waive any of the conditions to the Debt Offer
(other than that the Closing shall have been consummated and that there shall
be no Law prohibiting consummation of the Debt Offer) as may be reasonably
requested by the Investor and shall not, without the written consent of the
Investor, waive any condition to the Debt Offer or make any changes to the Debt
Offer other than as agreed between the Investor and the DC Contributors.  Notwithstanding the immediately preceding
sentence, DCC shall not be required to make any change to the terms and
conditions of the Debt Offer requested by the Investor that affects the price
per Certificate or Exchange Debenture payable in the Debt Offer or related
consent solicitation or imposes conditions to the Debt Offer or related consent
solicitation.

 

75

 

(e)           If the requisite consents
are received in the Debt Offer, the DC Contributors covenant and agree that,
promptly following the expiration date of the Debt Offer, they shall cause DCC
to use its commercially reasonable efforts to cause the Auburn Hills Trustee
and/or the Trustee to execute a supplement to the Trust Agreement and/or a
supplement to the Debenture Indenture, which supplement to the Trust Agreement
and/or the supplement to the Debenture Indenture shall implement the amendments
described in the Offer Documents and shall become operative only concurrently
with the payment by DCC of the Debt Offer consideration described in the Offer
Documents.

 

(f)            If the requisite consents
are received in the Debt Offer, on or prior to the Closing Date, the DC
Contributors shall cause DCC to, in accordance with the Offer Documents, accept
for payment and thereafter promptly pay for the Certificate and/or Exchange
Debentures that have been properly tendered and not properly withdrawn pursuant
to the Debt Offer; provided that on the Closing Date, the DC Contributors shall
reimburse DCC for such portion of the payment made in connection with the Debt
Offer in excess of the sum of the aggregate principal amount of all the
Certificates and/or Exchange Debentures accepted for payment in the Debt Offer,
plus the accrued and unpaid interest on the Certificates and/or Exchange
Debentures accepted for payment in the Debt Offer (which reimbursement may be
effected through the cancellation of Intercompany Indebtedness).

 

(g)           In connection with the Debt
Offer, DCC may select one or more dealer managers, information agents,
depositaries and other agents, to provide assistance in connection therewith
and DCC may enter into customary agreements (including indemnities) with such parties
so selected.  DCC shall pay the fees and
out-of pocket expenses of any dealer manager, information agent, depositary or
other agent retained in connection with the Debt Offer upon the incurrence of
such fees and out-of-pocket expenses.

 

(h)           In the event that the
consent solicitation referred to in Section 5.15(c) has not been
successful at the time of the Closing and the condition contained in Section 8.02(g) shall,
as a result, not have been satisfied, the parties shall work in good faith to
achieve a mutually satisfactory resolution on a timely basis.

 

SECTION 5.16.  Certain Pre-Closing Actions.  (a) At or prior to the Closing, the DC
Contributors shall cause the Company and the Company Subsidiaries and, as
applicable, the Affiliates of the DC Contributors, to take the actions set
forth on Schedule 5.16(a).  Effective
immediately after the Closing, DCC and its Subsidiaries shall, as a result of
the foregoing actions and such further actions as may be required on the part
of the Guarantor, not owe any Funded Indebtedness to the Guarantor or any of
its Affiliates.

 

(b)           The parties shall negotiate
in good faith the terms and conditions of the matters set forth on Exhibit X
and shall take such steps as may be necessary to implement such terms and
conditions in good faith.  In the event
the parties are unable to agree on any matter relevant to the preceding
sentence, they agree to submit themselves to binding arbitration in the City of
New York at the conclusion of which they will each take such actions and
execute such documents as may be directed by the arbitrators.  In order to establish an arbitration panel,
the Investor and the DC Contributors together shall each select an
internationally recognized investment bank to serve on the panel which will
include a third internationally recognized

 

76

 

investment bank selected by
the two investment banks chosen by the parties. 
Cost and expenses of the arbitration shall be paid as directed by the
arbitration panel.

 

(c)           Prior to the Closing, the DC
Contributors shall cause the Company to remove the word “Daimler” from its
name.

 

(d)           Not later than five Business
Days prior to the scheduled Closing Date, the DC Contributors shall deliver to
the Investor a statement, which shall have been prepared by the DC
Contributors, setting forth the DC Contributors’ good faith estimate of the
Headquarters Reimbursement Amount (such amount, the “Estimated Headquarters
Reimbursement Amount”). As of the Closing Date, any accruals in respect of
the costs which have historically been referred to as “Headquarters Allocation”
in the income statement of the Company and the Company Subsidiaries (other than
any such accruals in respect of the Parent Equity Plans) shall be cancelled
without any payment by the Company or any Company Subsidiary.

 

(e)           At or immediately prior to
the Closing, the DC Contributors shall cause their Affiliates to pay in full
all the intercompany receivables owed by any Affiliate of the DC Contributors
(other than the Company and the Company Subsidiaries) to DCMH which relate to
the Mexican Mercedes and Freightliner financial services business.  The amount of the foregoing receivables, as
of December 31, 2006, was approximately $862 million.  The proceeds from such repayment, to the
extent not used to repay the third-party financings associated with the Mexican
Mercedes and Freightliner financial services business, shall remain at DCMH at
Closing.

 

(f)            The DC Contributors shall
cause the Company and its Subsidiaries to suspend payment of amounts relating
to the “fuel cell joint venture” described in Exhibit J that would
otherwise be owed by Company Subsidiaries to Affiliates of the DC Contributors
and be payable after the date of this Agreement and prior to the Closing (such
amounts, in the aggregate, the “Fuel Cell Amount”).  If after the Closing, the Company or a
Company Subsidiary determines to participate in such fuel cell joint venture,
the Fuel Cell Amount shall become payable and the parties shall cause the Company
and the Company Subsidiaries to pay the Fuel Cell Amount to the Affiliate of
the DC Contributor to whom the Fuel Cell Amount is owed at the same time as the
Company or a Company Subsidiary is required to make its first payment following
admission to such joint venture and the Fuel Cell Amount shall then be
calculated for the relevant periods consistent with past practice. To the
extent the Company chooses not to join the fuel cell joint venture, all
suspended payments referred to in this Section 5.16(f) shall be
forgiven.

 

SECTION 5.17.  FinCo Books and Records.  The DC Contributors shall cause FinCo to
generate, by not later than June 30, 2007, and to continue to maintain
through the Closing Date, financial books and records of the Financial Services
Companies that present fairly in all material respects the financial condition,
results of operations and cash flows of the Financial Services Companies, on
the Financial Services Business Carve-Out Basis, as set forth in Note 1 to the December 31,
2006 Financial Services Business Carve-Out Basis Financial Statements, as
modified by the principles and procedures set forth on Schedule 5.17
(stand-alone procedures) in order to reflect the operations of the Financial
Services Companies on a standalone basis, including that the change in net
assets excluding comprehensive income of the Financial Services Businesses from
January 1, 2007 through the Closing Date, as calculated in

 

77

 

accordance with the
Stand-Alone Books, shall have adjusted the inter-company indebtedness of the
Financial Services Companies to the Guarantor or its Affiliates on a
dollar-for-dollar basis (the “Stand-Alone Books”).  The Stand-Alone Books shall be prepared on a
basis sufficient to support the preparation of stand-alone financial statements
for the Financial Services Businesses for the periods between June 30,
2007 and the Closing Date in accordance with Schedule 5.17 and the requirements
of Regulation S-X promulgated by the SEC (the “Stand-Alone Financial
Statements”).  The DC Contributors
shall use their best efforts to assist the Company and the Company Subsidiaries
in their preparation (whether before and/or after the Closing) of the
Stand-Alone Financial Statements based on the Stand-Alone Books.

 

SECTION 5.18.  Compliance Remediation.  Prior to the Closing, the DC Contributors
shall cause the Company and the Company Subsidiaries to use their reasonable
best efforts to cure in all material respects any one or more instances of
non-compliance with Laws or Governmental Orders, failures to possess or
maintain Permits, or defaults under Permits, referred to in item 6 of Section 3.10
of the DC Contributors Disclosure Schedule, such that the representations and
warranties set forth in Section 3.10 of this Agreement, after giving
effect to such cures, would be true and correct in all material respects on a
prospective basis without regard to the exceptions to such representations and
warranties set forth in item 6 of Section 3.10 of the DC Contributors
Disclosure Schedule.

 

SECTION 5.19.  Funded Indebtedness.  (a) Except as otherwise contemplated by Article II
and Sections 5.15 and 5.16, with effect from January 1, 2007, DCC shall
not (i) pay, discharge or satisfy any Funded Indebtedness owed to the DC
Contributors or their Affiliates (other than the Company and the Company
Subsidiaries) or (ii) lend or advance any amounts to the DC Contributors
or their Affiliates; provided, that any deemed violations of this Section 5.19
from and after January 1, 2007 through the date hereof, shall be deemed to
be cured to the extent that prior to the Closing, the DC Contributors or their
Affiliates (other than the Company or the Company Subsidiaries) return to DCC
any amounts received by them in violation of clause (i) and repay to the
Company or Company Subsidiaries any amounts borrowed by them or advanced to
them in violation of clause (ii).

 

(b)           (i)            The DC Contributors and
their Affiliates may, between July 1 and July 31, 2007, lend up to
$850 million to DCC and its Subsidiaries, and any such loans, to the extent
they remain outstanding, shall be repaid at Closing in accordance with Section 2.03(b)(viii).

 

(ii)           The DC
Contributors and their Affiliates may, after July 31, 2007 and prior to
Closing, lend up to an additional $1.15 billion to DCC and its Subsidiaries,
and any such loans, to the extent they remain outstanding, shall be repaid at
Closing in accordance with Section 2.03(b)(viii).

 

(iii)          In the event that, prior to
the Closing, cash in excess of the Additional Cash Amount, which represents the
maximum amount that may be advanced as contemplated by the foregoing clauses (i) and
(ii), is required for the operation of the business of DCC and its Subsidiaries
and DCC and its Subsidiaries need to borrow such additional cash from the DC
Contributors and their Affiliates (other than the Company or Company
Subsidiaries), the DC

 

78

 

Contributors and the
Investor shall negotiate in good faith to agree on an increased Additional Cash
Amount that takes into account such additional cash requirements of the
business of DCC and its Subsidiaries.

 

ARTICLE VI

 

EMPLOYEE
MATTERS

 

SECTION 6.01.  Continued Employment.  Each Company Employee shall continue to be
employed by the Company or a Company Subsidiary effective as of the
Closing.  Subject to the provisions of Section 6.02,
nothing in this Section 6.01 shall prohibit the Investor or any of its
Subsidiaries from terminating the employment of any Company Employee after the
Closing Date.  The Investor shall cause
the Company to be responsible for any severance obligations incurred by
operation of law or pursuant to any severance plan, program, arrangement or
agreement of the Company or any Company Subsidiary in connection with the
termination of a Company Employee on or after the Closing.

 

SECTION 6.02.  Agreements Covering Employees.  The Investor shall cause the Company or one
or more Company Subsidiaries to honor and assume, without modification, all
contracts, agreements, Collective Bargaining Agreements and commitments of the
Company and any Company Subsidiary as of the Closing which apply to any Company
Employee or any former officer, director or employee of the Company or any
Company Subsidiary; provided,  however, that this undertaking is
not intended to prevent the Investor or any of its Subsidiaries from enforcing
such contracts, agreements, Collective Bargaining Agreements and commitments in
accordance with their terms, including any reserved right to amend, modify, suspend,
revoke or terminate any such contract, agreement, Collective Bargaining
Agreement or commitment.

 

SECTION 6.03.  Service Credit.  The Investor agrees that the Company
Employees shall be credited for their actual and credited service with the
Company, the Company Subsidiaries, the DC Contributors and each of their
respective Affiliates, for purposes of eligibility, vesting and benefit accrual
(except in the case of a defined benefit pension plan sponsored by the Company
or any of its Subsidiaries in which Company Employees may commence
participation after the Closing), in any employee benefit plans covering
Company Employees after the Closing; provided,  however, that such
crediting of service shall not operate to duplicate any benefit to any such
Company Employee or the funding for any such benefit.  Such benefits shall not be subject to any
exclusion for any pre-existing conditions, and credit shall be provided for any
deductible or out-of-pocket amounts paid by such Company Employee during the
plan year in which the Closing Date occurs.

 

SECTION 6.04.  Assumption of Retention Agreements.  The Investor shall cause the Company or one
or more Company Subsidiaries to honor the employment and retention agreements
between the Company or the Company Subsidiaries and the individuals set forth
on Schedule 6.04.

 

79

 

SECTION 6.05.  Assumption of Liabilities.  The Company acknowledges that the DC
Contributors and their Affiliates, other than the Company and the Company Subsidiaries,
have no liabilities or obligations under any Company Benefit Plan providing any
post-retirement welfare benefits in the United States or Canada to any current
or former employees, officers or directors of the Company or any Company
Subsidiary and nothing herein shall be construed to impose any such liabilities
or obligations on such Persons.  As of
the Closing, the Company and the Company Subsidiaries shall continue to be
responsible for (and the Investor shall cause the Company or one or more
Company Subsidiaries to honor and assume), (a) all liabilities and
obligations of the Company and the Company Subsidiaries under the Company
Benefit Plans, (b) all liabilities and obligations arising under
Collective Bargaining Agreements, including liabilities for wages, benefits,
and other compensation, unfair labor practices, grievances, arbitrations, and
contractual violations, and (c) all liabilities and obligations relating
to or arising out of the employment of Company Employees or the termination of
employment of Company Employees in each case, whether arising prior to, on or
after the Closing. As of the Closing, the Investor shall cause the Company or
one or more Company Subsidiaries to honor all benefits due to Company Employees
or former officers, directors or employees of the Company or any Company
Subsidiary and all acts, omissions and transactions under or in connection with
the Company Benefit Plans, whether arising prior to, on or after the
Closing.  The DC Contributors and the
Investor shall cause the Company or the Company Subsidiaries (as appropriate)
to indemnify and hold the DC Contributors and their Affiliates (other than the
Company or any Company Subsidiary) harmless against liabilities or obligations
arising under or relating to any Company Benefit Plan providing any
post-retirement welfare benefits.  The
indemnification provided in this Section 6.05 shall be subject to the
provisions of Article IX, except for the limitations set forth in Section 9.04(b) thereof.

 

SECTION 6.06.  Labor Negotiations.  Prior to the Closing Date, the DC Contributors
shall cause the Company and the Company Subsidiaries to update the Investor on
a current basis based on the status of the negotiations (but not less
frequently than once weekly) regarding any substantive negotiations or
discussions between the United Auto Workers Union (or any other labor union)
and the Company and the Company Subsidiaries in connection with active
bargaining over the terms and conditions for any successor Collective
Bargaining Agreement and/or the extension or amendment of an existing
Collective Bargaining Agreement.

 

SECTION 6.07.  Equity-Based Compensation.  (a) The Investor shall cause the Company
and the Company Subsidiaries to comply with all income and employment tax
withholding and reporting obligations in respect of any equity-based
compensation awards granted to a Company Equity Award Holder under equity-based
compensation plans sponsored or maintained by the Guarantor prior to the
Closing (the “Parent Equity Plans”). 
From the date hereof until the Closing, the Company and the Company
Subsidiaries shall pay Company Equity Award Holders (or, if such amounts are
paid by the Guarantor to reimburse the Guarantor for), the Company Equity Award
Holder Payments; provided,  that the aggregate amount of the
Company Equity Award Holder Payments shall not exceed $236 million and any such
amounts in excess of $236 million shall be borne by the DC Contributors or
their Affiliates (other than the Company or the Company Subsidiaries).  The Company Equity Award Holder Payments
payable by the Company or a Company Subsidiary in respect of any individual
Company Equity Award Holder who provides or has provided services to the DC
Contributors or an Affiliate, other than the Company or the Company
Subsidiaries shall be adjusted, consistent with current Company

 

80

 

and Grantor practice, by a
fraction, the numerator of which is the number of years of service with the
Company and its Subsidiaries and the denominator of which is the sum of (i) the
number of years of service with the DC Contributors or an Affiliate (other than
the Company or the Company Subsidiaries) and (ii) the number of years of
service with the Company or the Company Subsidiaries (the “Adjusted Company
Equity Award Holder Payment”).  Any
amount paid by the Company or the Company Subsidiaries from the date hereof and
prior to the Closing in excess of the Adjusted Company Equity Award Holder
Payments shall be taken into account in determining whether Company Equity
Award Holder Payments exceed $236 million. 
The Investor further acknowledges and agrees that the Guarantor has the
right to convert stock options granted under the Parent Equity Plans into stock
appreciation rights, in which case the Company and the Company Subsidiaries
shall continue to be obligated to make payments in respect of the difference
between the “reference price” and the “exercise price” in the same manner as if
such stock options had not been converted into stock appreciation rights.  Following the Closing, the DC Contributors or
their Affiliates (other than the Company and the Company Subsidiaries) shall
reimburse the Company or the Company Subsidiaries for all amounts paid after
the Closing by the Company or the Company Subsidiaries to Company Equity Award
Holders (including related income tax withholding and employment tax
obligations) with respect to awards under the Parent Equity Plans.

 

(b)           Not later than five Business
Days prior to the scheduled Closing Date, the DC Contributors shall deliver to
the Investor a statement, which shall have been prepared by the DC
Contributors, setting forth the DC Contributors’ good faith estimate of the
aggregate amount of the Company Equity Award Holder Payments (such aggregate
amount, the “Estimated Company Equity Award Holder Payments”).  Within 30 days after the Closing Date, the DC
Contributors shall deliver to the Investor a statement, which shall have been
prepared by the DC Contributors, setting forth the final aggregate amount of
the Company Equity Award Holder Payments (the “Company Equity Award Holder
Payments Statement”).  If the
Investor does not give written notice of its disagreement with the Company
Equity Award Holder Payments Statement within 30 days of its receipt of the
Company Equity Award Holder Payments Statement, then such statement shall be
considered final, binding and conclusive upon the Investor and the DC
Contributors.  If the Investor disputes
any portion of the Company Equity Award Holder Payments Statement, the dispute
resolution procedures set forth in Section 9.02(b)(iii) shall apply
mutatis mutandis with respect to such dispute.

 

(c)           If the final aggregate
amount of the Company Equity Award Holder Payments exceeds the Estimated
Company Equity Award Holder Payments, the DC Contributors shall pay an amount
equal to such excess to an account designated by the Company by wire transfer
of immediately available funds within five Business Days of the final
determination of the Company Equity Award Holder Payments.  If the Estimated Company Equity Award Holder
Payments exceed final aggregate amount of the Company Equity Award Holder
Payments, the parties shall cause the Company and its Subsidiaries to pay an
amount equal to such excess to an account designated by the DC Contributors by
wire transfer of immediately available funds within five Business Days of the
final determination of the Company Equity Award Holder Payments.

 

SECTION 6.08  Compliance with Agreements with
Governmental Authorities.  The Investor
agrees that it shall cause the Company and each Company Subsidiary to comply

 

81

 

with any provision in any
agreements between the Investor, the Guarantor, the Company and any
Governmental Authority requiring the Company or any Company Subsidiary to
provide notice to such Governmental Authority of certain corporate
transactions, including a merger, sale, transfer of assets, initial public
offering or other transaction involving the Company or any Company Subsidiary.  The Investor shall, or shall cause the
Company or any Company Subsidiary to, provide the DC Contributors with a copy
of such notice, or the information to be contained in such notice, at least
five Business Days prior to the time the Investor, the Company or any Company
Subsidiary is required to provide such notice to any Governmental Authority; provided
however, that it shall not be a breach of this provision if the Company
provides timely notice to such Governmental Authority in accordance with the
requirements of the applicable agreement.

 

ARTICLE VII

 

TAX
MATTERS

 

SECTION 7.01.  Tax Indemnities.  (a) (i)  The DC Contributors shall
jointly and severally indemnify and hold the Investor, the Company and each
Company Subsidiary harmless against Excluded Taxes.  The DC Contributors shall pay the amount for
which the DC Contributors are responsible to indemnify the Investor under this Section 7.01(a) to
the Investor and shall pay the amount for which the DC Contributors are
responsible to indemnify the Company or any Company Subsidiary under this Section 7.01(a) to
the Company.

 

(ii)           Any refund in
respect of the Canadian Transfer Pricing Dispute by any taxing jurisdiction to
which such dispute relates is for the account of DC Holding, and notwithstanding
anything to the contrary in Section 7.02(a), the Company shall pay over
promptly to DC Holding the full amount, if any, of Taxes that is refunded or it
applied as a credit against Taxes of the Company or any Company Subsidiary, in
the year or years applied against currently payable Taxes as a result of a
final determination of the Canadian Transfer Pricing Dispute by any and all
jurisdictions to which the Canadian Transfer Pricing Dispute relates.  The amount the Company is obligated to pay to
DC Holding pursuant to this Section 7.01(a)(ii), however, shall be net of
any Tax cost to the Investor, the Company or any Company Subsidiary or other
cost or expense reasonably incurred by the Company or any Company Subsidiary in
connection with the prosecution or receipt of such refund, credit or similar
benefit.

 

(b)           In the case of Taxes with
respect to a Straddle Period, for purposes of “Excluded Taxes”, the
portion of any such Tax that is allocable to the account of the DC Contributors
shall be:

 

(i)            in the case of
Taxes that are either (A) based upon or related to income or receipts, or (B) imposed
in connection with any sale or other transfer or assignment of property (real
or personal, tangible or intangible) (other than conveyances pursuant to this
Agreement, as provided under Section 7.06), deemed equal to the amount
which would be payable if the taxable period ended on the Closing Date; and

 

82

 

(ii)           in the case of
Taxes imposed on a periodic basis with respect to the assets of the Company or
any Company Subsidiary, or otherwise measured by the level of any item, deemed
to be the amount of such Taxes for the entire Straddle Period (after giving
effect to amounts which may be deducted from or offset against such Taxes) (or,
in the case of such Taxes determined on an arrears basis, the amount of such
Taxes for the immediately preceding period), multiplied by a fraction, the
numerator of which is the number of days in the period ending on the Closing
Date and the denominator of which is the number of days in the entire Straddle
Period.

 

In the case of any Tax based
upon or measured by capital (including net worth or long-term debt) or
intangibles, any amount thereof required to be allocated under this paragraph (b) shall
be computed by reference to the level of such items on the Closing Date.  All determinations necessary to effect the
foregoing allocations shall be made in a manner consistent with prior practice
of the Company and the Company Subsidiaries.

 

(c)           Transactions that occur on
the date of, but after, the Closing outside the ordinary course of business of
the Company, any Company Subsidiary or the DC Contributors and that are not
contemplated by this Agreement shall be treated as occurring on the day after
the Closing and, for purposes of this Article VII, in the taxable period
(or portion thereof) beginning the day after the Closing Date.

 

(d)           Payment by the indemnifying
party of any amount due under this Section 7.01 shall be made within 10
days following written notice by the indemnified party that payment of such
amounts to the appropriate Taxing Authority is due; provided that the Investor
shall comply with its obligation to promptly notify the DC Contributors under Section 7.03(a);
and provided,  further, that the indemnifying party shall not be
required to make any payment earlier than two days before it is due to the
appropriate Taxing Authority. 
Notwithstanding anything to the contrary herein, if the DC Contributors
receive an assessment or other notice of Taxes due for any taxable period (or
portion of any taxable period ending on or before the date of the Closing) for
which the DC Contributors are not responsible, in whole or in part, pursuant to
paragraph (a) of this Section 7.01, then the Company or the Company
Subsidiary on which the Tax is imposed or the Investor shall pay such Taxes, or
if the DC Contributors pay such Taxes, then the Investor, the Company or any
Company Subsidiary shall pay to the DC Contributors the amount of such Taxes
for which the DC Contributors is not responsible within five days following
such payment.  In the case of a Tax that
is contested in accordance with the provisions of Section 7.03, payment of
the Tax to the appropriate Taxing Authority will be considered to be due no
earlier than the date a final determination to such effect is made by the
appropriate Taxing Authority.

 

SECTION 7.02.  Tax Refunds and Tax Benefits.  (a) Any Tax refund, credit or similar
benefit (including any interest paid or credited with respect thereto) for
Taxes of the Company or any Company Subsidiary relating to taxable periods (or
portions of taxable periods) ending on or before the Closing Date, other than
refunds treated as an asset on the audited balance sheets of the Financial
Services Companies or the Industrial Companies for the fiscal year ending December 31,
2006, but not including the Canadian Transfer Pricing Provision, shall be the
property of the DC Contributors and, if actually realized by the Investor, the
Company or

 

83

 

any Company Subsidiary,
shall be paid over promptly to the DC Contributors net of any Tax or other cost
or expense reasonably incurred by the Investor, the Company or any Company
Subsidiary in connection with the prosecution or receipt of such refund, credit
or similar benefit.  The Investor shall,
if the DC Contributors so request and at the DC Contributors’ expense, cause
the Company or other relevant entity to file for and use their reasonable best
efforts to obtain and expedite the receipt of any refund to which the DC
Contributors is entitled under this Section 7.02.  The Investor, the Company and each Company
Subsidiary shall permit the DC Contributors to control (at the DC Contributors’
expense) the prosecution of any such refund claim.  Notwithstanding anything in the foregoing to
the contrary, it is agreed that only the first $500 million of any refund of
U.S. federal income Taxes in respect of the tax years of the Company or any
Company Subsidiary ending on December 31 of 1994 through 1998 (the “Excepted
Refund”) (which $500 million ceiling shall include, for the avoidance of
doubt, interest that is in respect of such Excepted Refund) is the property of
the Company.  The excess of the Excepted
Refund over $500 million (including interest thereon) shall be the property of
the DC Contributors (net of any Tax or other cost or expense reasonably
incurred by the Investor, the Company or any Company Subsidiary in connection
with the prosecution or receipt of such portion of the refund), and the Company
or any Company Subsidiary shall promptly pay such excess to the DC Contributors
when such excess is received by the Company or any Company Subsidiary, or when,
and to the extent that, such excess is credited against and reduces the amount
of actual cash Taxes (other than Excluded Taxes) payable by the Company or any
Company Subsidiary.  Any other Tax
refunds relating to taxable periods (or portions of taxable periods) ending on
or before the Closing Date shall be the property of the DC Contributors (net of
any Tax or other cost or expense reasonably incurred by the Investor, the
Company or any Company Subsidiary in connection with the prosecution or receipt
of such refund).  The Company shall
provide the DC Contributors with copies of all material correspondence between
the Company and the Internal Revenue Service or other applicable Governmental
Authorities in connection with the Excepted Refund.  Each party shall be permitted to reasonably
participate in the prosecution of the Excepted Refund.

 

(b)           Any available amount
otherwise payable by the DC Contributors under Section 7.01 shall be
reduced by any reduction in Taxes otherwise payable at the time (whether
currently or in a later tax period) actually realized by any Company Subsidiary
that is treated as a corporation for U.S. federal income tax purposes to the
extent such reduction arises in connection with any underlying adjustment
resulting in the obligation of such Company Subsidiary to pay Taxes or other
amounts for which the DC Contributors are responsible under Section 7.01
or the accrual or payment of such Taxes.

 

(c)           Any Tax refund (including
any interest paid or credited with respect thereto) for Taxes of the Company or
any Company Subsidiary that is received by (i) the DC Contributors and is
not described in Section 7.01(a) as payable to the DC Contributors or
in Section 7.02(a) or 7.02(b) or (ii) the Investor shall be
property of the Company and, if received by either the DC Contributors or the
Investor, shall be promptly paid over to the Company.

 

SECTION 7.03.  Contests.  (a) After the Closing, the Investor
shall promptly notify the DC Contributors in writing of the proposed assessment
or the commencement of any Tax audit or administrative or judicial proceeding
or of any demand or claim on the Investor, its Affiliates, the Company or any
Company Subsidiary which, if determined adversely to the

 

84

 

taxpayer or after the lapse
of time, could be grounds for indemnification by the DC Contributors under Section 7.01.  Such notice shall contain factual information
(to the extent known to the Investor, its Affiliates, the Company or any
Company Subsidiary) describing the asserted Tax liability in reasonable detail
and shall include copies of any notice or other document received from any
Taxing Authority in respect of any such asserted Tax liability.  The failure of the Investor to timely forward
such notification and communications in accordance with this Section 7.03
shall not relieve the DC Contributors of its obligation to pay such Tax
liability or any indemnity therefor, except to the extent that the failure to
timely forward such notification and communications materially prejudices the
ability of the DC Contributors to contest such Tax liability or materially
increases the amount of such Tax liability.

 

(b)           In the case of a Tax audit
or administrative or judicial proceeding (a “Contest”) that relates to
taxable periods of the Company or any Company Subsidiary ending on or before
the Closing Date, the DC Contributors shall have the sole right, at their
expense, to control the conduct of such Contest; provided, that the DC
Contributors shall (i) acknowledge in writing their liability for the
outcome of such contest and (ii) permit the Investor to participate in (at
the Investor’s expense) the prosecution of any such Contest, and the DC
Contributors shall not settle such Contest without the written consent of the
Investor if such Contest could reasonably be expected to negatively affect, in
a material way, the Tax liability of the Investor, the Company or any Company
Subsidiary which consent shall not be unreasonably withheld or delayed; provided,
further, that the Investors shall have the sole right to represent the
interests of the Company and each Company Subsidiary in any Contest that
relates to taxable periods of the Company or any Company Subsidiary ending on
or before the Closing Date in respect of Tax that is not an Excluded Tax.  Notwithstanding anything to the contrary, the
DC Contributors shall have the sole right, at the Company’s expense, to control
the conduct of the Canadian Transfer Pricing Dispute.

 

(c)           The DC Contributors and the
Investor jointly shall represent the interests of the Company and each Company
Subsidiary in any Contest relating to any Straddle Period for which each party
may have Tax liability.  Neither party
shall settle any dispute relating to a Tax liability attributable to the
Company or any Company Subsidiary for a Straddle Period without the consent of
the other party (which consent shall not be unreasonably withheld or delayed); provided,
however, that if either the DC Contributors or the Investor proposes to
accept a settlement of such Contest offered in writing by the applicable Taxing
Authority (the “Proposing Party”), where the greater portion of the
proposed settlement amount would be borne by the Proposing Party, the liability
of the Proposing Party under this Article VII in respect of such Tax
liability shall be limited (i) in the case of the DC Contributors, to the
portion of the proposed settlement amount attributable to the portion of the
Straddle Period for which the DC Contributors have an indemnity obligation
pursuant to Section 7.01 and (ii) in the case of the Investor, to the
portion of the proposed settlement amount attributable to the portion of the
Straddle Period for which the Investor is not indemnified pursuant to Section 7.01
and, upon final determination of the Tax liability, notwithstanding any
limitation under Section 7.01, the DC Contributors shall promptly (and in
any event within 15 days) pay the Company its share of such Tax liability
determined under this subsection (c) upon receipt of written request
therefor from the Investor.  All costs,
fees and expenses paid to third parties in the course of such Contest shall be
borne by the DC Contributors and the Investor in the same ratio as the ratio in
which, pursuant to the terms of this Article VII, the DC Contributors and
the Investor would share the

 

85

 

responsibility for payment
of the Taxes; provided,  however, that in the event that any party
hereto retains its own advisors or experts in connection with any such Contest,
the costs and expenses thereof shall be borne solely by such party.

 

(d)           The Investor shall have the
sole right to represent the interests of the Company and each Company
Subsidiary in any Contest relating to any Tax period beginning on or after the
Closing Date (or to any Straddle Period for which the DC Contributors have no
Tax liability) and to employ counsel of its choice at the Company’s expense, as
long as the Investor remains the tax matters partner of the Company.

 

(e)           The Investor and the DC
Contributors agree to cooperate, and the Investor agrees to cause the Company
and the Company Subsidiaries to cooperate, in the defense against or compromise
of any claim in any Contest.

 

SECTION 7.04.  Preparation of Tax Returns.  (a) The DC Contributors shall prepare
and file (or cause the Company and the Company Subsidiaries to prepare and
file) all Tax Returns for taxable periods ending on or before the date of the
Closing.

 

(b)           The Investor shall prepare
and file (or cause the Company and the Company Subsidiaries to prepare and
file) all Tax Returns that relate to taxable periods ending after the date of
the Closing (each a “Post-Closing Tax Return”) and shall file its Tax
Returns consistently therewith.  Each
Post-Closing Tax Return shall be prepared on a basis consistent with applicable
Tax law as determined appropriate by the Investor in the Investor’s sole
discretion, subject to the provisions of the LLC Operating Agreement and Section 7.08(a).  The Investor shall provide the DC
Contributors and their authorized representative with a copy of any completed
Post-Closing Tax Return as to which Taxes are allocable to the DC Contributors
under Section 7.01 hereof and a statement (with which the Investor will
make available supporting schedules and information) certifying the amount of
Tax shown on such Post-Closing Tax Return that is allocable to the DC
Contributors pursuant to Section 7.01 at least 30 days prior to the due
date (including any extension thereof) for filing of such Post-Closing Tax
Return.  The Investor shall permit the DC
Contributors and their authorized representative to review and comment on such
Post-Closing Tax Return and statement prior to its filing and the Investor
shall consider in good faith all such comments prior to filing such
Post-Closing Tax Return.

 

SECTION 7.05.  Tax Cooperation and Exchange of
Information.  The DC Contributors and
the Investor shall provide each other with such cooperation and information as
either of them reasonably may request of the other (and the Investor shall
cause the Company and the Company Subsidiaries to provide such cooperation and
information) in filing any Tax Return, amended Tax Return or claim for refund,
determining a liability for Taxes or a right to a refund of Taxes or
participating in or conducting any audit or other proceeding in respect of
Taxes.  Such cooperation and information
shall include providing copies of relevant Tax Returns or portions thereof,
together with related work papers and documents relating to rulings or other
determinations by Taxing Authorities. 
The DC Contributors and the Investor shall make themselves (and their
respective employees) reasonably available on a mutually convenient basis to
provide such cooperation, including explanations of any documents or
information provided under this Section 7.05.  Notwithstanding anything to the contrary in Section 5.02,
each of the

 

86

 

DC Contributors and the
Investor shall retain all Tax Returns, work papers and all material records or
other documents in its possession (or in the possession of its Affiliates)
relating to Tax matters for any taxable period that includes the date of the
Closing (and any Delayed Closing) and for all prior taxable periods until the
expiration of the statute of limitations of the taxable periods to which such
Tax Returns and other documents relate, without regard to extensions except to
the extent notified by the other party in writing of such extensions for the
respective Tax periods.  Any information
obtained under this Section 7.05 shall be kept confidential, except as may
be otherwise necessary in connection with the filing of Tax Returns or claims
for refund or in conducting an audit or other proceeding.

 

SECTION 7.06.  Conveyance Taxes.  The DC Contributors on the one hand and the
Investor on the other shall each be liable for half of any and all Conveyance
Taxes which become payable in connection with the transactions contemplated by
this Agreement.  For the avoidance of
doubt, Conveyance Taxes shall not be treated as Excluded Taxes for purposes of
this Article VII.  The Investor and
the DC Contributors agree to cooperate reasonably in the execution and delivery
of all instruments and certificates necessary to enable the DC Contributors,
the Investor, the Company, and any Company Subsidiary to comply with any
pre-Closing filing requirements and in reducing the amount of Conveyance Taxes
payable in connection with the transfers described in Section 2.03(b) of
this Agreement.

 

SECTION 7.07.  Tax Covenants.  (a) From and after the date of this
Agreement to and including the Closing Date, except as required under the
Accounting Principles or by a final nonappealable requirement of a Taxing
Authority, the DC Contributors shall ensure that neither the Company nor any
Company Subsidiary makes any change in any Tax accounting method or in the
manner of applying such methods, or files any amended Tax Returns or claims for
refunds, in each case, without the prior written consent of the Investor, which
consent shall not be unreasonably withheld or delayed.

 

(b)           From and after the date of
this Agreement to and including the Closing Date, except as required under the
Accounting Principles or by a final nonappealable requirement of a Taxing
Authority, the DC Contributors shall cause each relevant Company Subsidiary (i) to
prepare all Tax Returns in a manner which is consistent with the past practices
of the Company Subsidiary (and its respective predecessor), as the case may be,
with respect to the treatment of items on such Tax Returns except to the extent
that any inconsistency could not reasonably be expected to materially increase
the Investor’s, Company’s or any Company Subsidiaries’ liability for Taxes and (ii) to
refrain from entering into any material settlement or closing agreement with a
Taxing Authority without the consent of the Investor, which consent shall not
be unreasonably withheld.

 

(c)           Except as required by
applicable law, neither the Investor nor any Affiliate of the Investor shall
amend, refile or otherwise modify, or cause or permit the Company or any
Company Subsidiary to amend, refile or otherwise modify, any Tax election or
Tax Return or item that would be reflected thereon with respect to any taxable
period (or portion of any taxable period), ending on or before the Closing Date
without the prior written consent of the DC Contributors.

 

87

 

(d)           Except as otherwise required
by a final nonappealable requirement of a Taxing Authority, the DC Contributors
and the Investor agree that, for all U.S. federal, state and local tax
purposes, the transfers described in Section 2.03(b) are
contributions of property to a partnership in exchange for interests in a
partnership, and they will report and otherwise treat such transfers
accordingly on their respective U.S. federal, state and local tax returns and
related correspondences with any Tax authority.

 

SECTION 7.08.  Tax Matters Partner; Allocations.  (a) The Investor shall serve as the tax
matters partner of the Company and shall have full authority, in its sole
discretion, to make all elections, to establish all tax and tax accounting
methods, and to determine all tax and tax accounting reporting standards; provided,
however, that so long as DC Holding is a member of the Company and
without the consent of one of the DC Contributors, no election: (i) to use
the FIFO method of accounting for inventory, (ii) to change a LIFO method
of accounting for inventory or (iii) to change the method of depreciation
from MACRS (as described in Section 168 of the Code) in the case of
properties subject to MACRS (by making an election under Section 168(b)(5))
shall be made in respect of assets of the Company or any Company Subsidiary
held on the Closing Date.

 

(b)           The value of the tangible
and intangible assets of the Company and, where applicable, the Company
Subsidiaries (including assets described in Section 751(a) of the
Code) will be determined in a manner provided in the LLC Operating Agreement
consistent with the LLC Operating Agreement Term Sheet.

 

SECTION 7.09.  Miscellaneous.  (a) For Tax purposes, the parties agree (i) to
treat any payment made by the Investor or the DC Contributors under this Article VII,
under any other indemnity provisions contained in this Agreement or for any
breach of representations, warranties, covenants or agreements as a
contribution to the Company and, except in respect of payments covered by Section 7.02(b),
to specially allocate any deduction, cost or expense related to such payment to
either the Investors or the DC Contributors, as the payor of such payment and (ii) to
the extent any such payments are received by the Investor or the DC
Contributors, to treat such payments as reductions of the amounts contributed
to the Company, respectively, pursuant to Section 2.03(b)(i) through
(iii), as the case may be.

 

(b)           This Article VII shall
be the sole provision governing indemnities for Taxes under this Agreement.

 

(c)           For purposes of this Article VII,
all references to the Investor, the DC Contributors, Affiliates, the Company
and any Company Subsidiary include successors and predecessors.

 

(d)           Notwithstanding any
provision in this Agreement to the contrary, the covenants and agreements of
the DC Contributors and the Investor contained in this Article VII shall
survive the Closing and shall remain in full force until the later of (i) 90
days after the expiration of the applicable statutes of limitations for the
Taxes in question (taking into account any extensions or waivers thereof) or (ii) in
the case of any claim made with reasonable specificity by the party seeking to
be indemnified within the time period set forth in clause (i), until such claim
is finally and fully resolved.

 

88

 

(e)           Any Tax sharing agreement or
arrangement between the DC Contributors or any of their Affiliates (other than
the Company and the Company Subsidiaries), on the one hand, and any of the
Company and the Company Subsidiaries, on the other hand, shall be terminated as
of the applicable Closing Date, and no payments shall be permitted to be made
on or after the date hereof.

 

(f)            Payments by the DC
Contributors under this Article VII shall be limited to the amount of any
liability or damage that remains after deducting therefrom any indemnity,
contribution or other similar cash payment recoverable by the Investor, the
Company or any of the Company Subsidiaries or any Affiliates of the Investor
from any third party with respect thereto.

 

(g)           The Company and the Investor
agree not to cause the Company or any Company Subsidiary that is a partnership
for United States federal income tax purposes to terminate within the meaning
of Section 708(b)(1)(B) of the Code so long as DC Holding is a member
of the Company; provided,  however, that this Section 7.09 (g) shall
not prohibit any transfer or other action that is otherwise permitted under
this Agreement or the LLC Operating Agreement.

 

ARTICLE VIII

 

CONDITIONS
TO CLOSING

 

SECTION 8.01.  Conditions to Obligations of the DC
Contributors.  The obligations of the
DC Contributors to consummate the transactions contemplated by this Agreement
shall be subject to the fulfillment or written waiver, at or prior to the
Closing, of each of the following conditions:

 

(a)           Representations, Warranties
and Covenants.  (i) The
representations and warranties of the Investor contained in this Agreement
shall be true and correct on and as of the Closing Date with the same effect as
though such representations and warranties had been made on and as of the
Closing Date (except for representations and warranties that expressly speak
only as of a specific date or time which need only be true and correct as of
such date or time) except for such failures of representations and warranties
to be true and correct (without giving effect to any materiality qualification
or standard contained in any such representations and warranties) which have
not had and would not reasonably be expected to have, individually or in the
aggregate, an Investor Material Adverse Effect, and (ii) the covenants and
agreements contained in this Agreement to be complied with by the Investor on
or before the Closing shall have been complied with in all material
respects.  The DC Contributors shall have
received a certificate from the Investor signed by an executive officer of the
Investor with respect to the matters set forth in this Sections 8.01(a) and
(d);

 

(b)           Governmental Approvals.  (i) All mandatory waiting periods (and
any extension thereof) prescribed by the HSR Act, the Antitrust Laws under
Council Regulation (EC) No. 139/2004 of 20 January 2004 and Part IX
of the Competition Act (Canada)
and the Antitrust Laws of any other jurisdiction set forth on Schedule 8.01
applicable to the purchase of the Investor Equity Interests contemplated by
this Agreement shall have expired or shall have been

 

89

 

terminated and (ii) all
other notices, reports and other filings required to be made by the Investor,
the DC Contributors or any of their respective Affiliates with, and all other
Permits required to be obtained by the Investor, the DC Contributors or any of
their respective Affiliates from, any Governmental Authority set forth on
Schedule 8.01 in connection with the execution and delivery of this Agreement
and the consummation of the transactions contemplated by this Agreement shall
have been made or obtained (as the case may be);

 

(c)           No Order.  No Governmental Authority shall have enacted,
issued, promulgated, enforced or entered any Law or Governmental Order (whether
temporary, preliminary or permanent) that has the effect of making the
transactions contemplated by this Agreement or the Ancillary Agreements illegal
or otherwise prohibiting the consummation of such transactions;

 

(d)           No Material Adverse Effect.  From the date of this Agreement, no Investor
Material Adverse Effect shall have occurred;

 

(e)           Repayment of FinCo
Intercompany Debt.  All Funded
Indebtedness owed by FinCo to the DC Contributors and their Affiliates (other
than Subsidiaries of FinCo and other than DCC and its Subsidiaries) as set
forth in the Stand Alone Books shall have been repaid or forgiven, provided
that if such Funded Indebtedness exceeds $38.5 billion, $38.5 billion of such
Funded Indebtedness shall have been repaid;

 

(f)            Release of the DC
Contributors Credit Support Instruments.  The Investor shall have complied in all
material respects with its obligations under Section 5.08; and

 

(g)           Approval of the Supervisory
Board.  This Agreement and the
transactions contemplated hereby shall have been approved by the Supervisory
Board of the Guarantor.

 

SECTION 8.02.  Conditions to Obligations of the Investor.  The obligations of the Investor to consummate
the transactions contemplated by this Agreement shall be subject to the
fulfillment or written waiver, at or prior to the Closing, of each of the
following conditions:

 

(a)           Representations, Warranties
and Covenants.  (i) The
representations and warranties of the DC Contributors and the Guarantor
contained in this Agreement shall be true and correct on and as of the Closing
Date with the same effect as though such representations and warranties had
been made on and as of the Closing Date (except for representations and
warranties that expressly speak only as of a specific date or time which need
only be true and correct as of such date or time) except for such failures of
representations and warranties to be true and correct (without giving effect to
any materiality qualification or standard contained in any such representations
and warranties) which have not had and would not reasonably be expected to have
either a Company Material Adverse Effect or, individually or in the aggregate,
a DC Contributors Material Adverse Effect, and (ii) the covenants and
agreements contained in this Agreement to be complied with by the DC
Contributors and, with respect to Section 11.10(e) only, the
Guarantor at or before the Closing shall have been complied with in all
material respects.  The Investor shall
have received a certificate from each of the DC Contributors signed by
executive officers of each of the DC Contributors and the Guarantor with
respect to the matters set forth in this Sections 8.02(a) and (d);

 

90

 

(b)           Governmental Approvals.  (i) All mandatory waiting periods (and
any extension thereof) prescribed by the HSR Act and the Antitrust Laws under
Council Regulation (EC) No. 139/2004 of 20 January 2004 and Part IX
of the Competition Act (Canada)
and the Antitrust Laws of any other jurisdiction set forth on Schedule 8.01
applicable to the purchase of the Investor Equity Interests contemplated by
this Agreement shall have expired or shall have been terminated and (ii) all
other notices, reports and other filings required to be made by the Investor,
the DC Contributors or any of their respective Affiliates with, and all other
Permits required to be obtained by the Investor, the DC Contributors or any of
their respective Affiliates from, any Governmental Authority set forth on
Schedule 8.01 in connection with the execution and delivery of this Agreement
and the consummation of the transactions contemplated by this Agreement shall
have been made or obtained (as the case may be);

 

(c)           No Order.  No Governmental Authority shall have enacted,
issued, promulgated, enforced or entered any Law or Governmental Order (whether
temporary, preliminary or permanent) that has the effect of making the
transactions contemplated by this Agreement or the Ancillary Agreements illegal
or otherwise prohibiting the consummation of such transactions;

 

(d)           No Material Adverse Effect.  From the date of this Agreement, no Company
Material Adverse Effect, Guarantor Material Adverse Effect or DC Contributors
Material Adverse Effect shall have occurred;

 

(e)           Pre-Closing Restructuring. The
Pre-Closing Restructuring Transactions shall have been consummated in all
material respects;

 

(f)            Collective Bargaining
Agreement.  After the
date hereof, in the event that the United Automobile Workers Union, on the one
hand, and the Company or any Company Subsidiary, on the other hand, enter into
a Collective Bargaining Agreement and/or the extension of or amendment to an
existing Collective Bargaining Agreement (i) on or before August 31,
2007, such successor Collective Bargaining Agreement or extension of, or
amendment to, an existing Collective Bargaining Agreement shall be satisfactory
to the Investor in its sole discretion or (ii) after August 31, 2007,
such successor Collective Bargaining Agreement or extension of, or amendment
to, an existing Collective Bargaining Agreement shall be satisfactory to the
Investor in its reasonable discretion;

 

(g)           Requisite Financing. The Investor
shall have received Debt Financing on terms set forth in the Debt Financing
Commitments in an aggregate amount sufficient to refinance the Indebtedness of
the Financial Services Companies (and pay any out-of-pocket, third-party fees
and expenses payable in connection therewith) and, with respect to matters
pertaining to such Debt Financing not addressed in the Debt Financing
Commitments, on other terms reasonably satisfactory to the Investor; provided
that the condition in this clause (g) shall be deemed satisfied if a
reason the Investor did not receive such Debt Financing was (i) the
failure of funding pursuant to the Equity Financing Commitment despite the
satisfaction of the conditions therein or the failure of any equity funding
condition of similar effect in the Debt Financing Commitments, (ii) the
failure to pay costs, fees, expenses and other compensation contemplated by the
Debt Financing Commitments (or the related fee letters) payable by the Investor
or any of its Affiliates to the lead arrangers, other lenders and
administrative agents of

 

91

 

the Debt Financing, or (iii) a
breach in any material respect by the Investor or its Affiliates under the
Financing Commitments (or the related fee letters) not as a result of a breach
by the Guarantor or the DC Contributors under this Agreement; and

 

(h)           Approval of the Supervisory
Board.  This Agreement and the
transactions contemplated hereby shall have been approved by the Supervisory
Board of the Guarantor.

 

ARTICLE IX

 

INDEMNIFICATION

 

SECTION 9.01.  Survival of Representations and Warranties.  The representations and warranties of the DC
Contributors, the Guarantor and the Investor contained in this Agreement and in
the certificates delivered pursuant to Sections 8.01(a) and 8.02(a) shall
survive the Closing for a period of 12 months after the Closing; provided,
however, that (a) the representations and warranties made pursuant
to Sections 3.01, 3.02, 3.03, 4.01, and 11.10(b) shall survive
indefinitely; and (b) the representations and warranties dealing with
Environmental Matters shall survive as provided in Section 3.11(c); provided,
further, that any claims made with reasonable specificity by the party
seeking to be indemnified within the time periods set forth in this Section 9.01
shall survive until such claims are finally and fully resolved.  All covenants and agreements contained herein
shall terminate at the Closing, except for those covenants and agreements that
by their terms are to be performed in whole or in part after the Closing, which
shall remain in full force and effect until performed in accordance with their
terms; provided, however, that any claim made with reasonable
specificity by the party seeking to be indemnified within the time periods set
forth in this Section 9.01 (and any claims in respect of pre-Closing
breaches of Section 5.01 made, no later than the 12-month anniversary of
the Closing Date, with reasonable specificity by the party seeking to be
indemnified) shall survive until such claims are finally and fully resolved.

 

SECTION 9.02.  Indemnification by the DC Contributors.  (a) The Investor and its Affiliates,
officers, directors, employees, agents, successors and assigns (each, an “Investor
Indemnified Party”) shall be indemnified and held harmless by the DC
Contributors for and against all losses, damages, claims, costs and expenses,
interest, awards, judgments and penalties (including reasonable attorneys’ and
consultants’ fees and expenses) suffered or incurred by them (hereinafter, a “Loss”),
arising out of or resulting from:

 

(i)            the breach of
any representation or warranty made by the DC Contributors contained in this
Agreement or made in the certificate delivered pursuant to Section 8.02(a) (other
than the representations and warranties in Section 3.27 which are
addressed in clause (b) below);

 

(ii)           the breach of
any covenant or agreement by the DC Contributors or the Guarantor contained in
this Agreement;

 

(iii) any
claim or cause of action by any Person arising before or after the Closing
against any Investor Indemnified Party with respect to the operations of the
Guarantor and its Subsidiaries (but excluding the Company and the

 

92

 

Company Subsidiaries) that
do not relate to the Company Business, except for claims or causes of action
with respect to which the Investor is obligated to indemnify the DC
Contributors Indemnified Parties pursuant to Section 9.03; or

 

(iv)          the matters referred to on
Schedule 9.02(a).

 

(b)           (i)            Within 30 days after the
date of this Agreement, the DC Contributors shall deliver to the Investor a
statement, which shall have been prepared by the DC Contributors, setting forth
the Entity Cash Indemnification Amount, the Entity Debt Indemnification Amount
and the Cash/Debt Indemnification Amount (the “Cash/Debt Indemnification
Statement”).

 

(ii)           If the Investor
does not give written notice of its disagreement with the Cash/Debt
Indemnification Statement within 30 days of its receipt of the Cash/Debt
Indemnification Statement, then such statement shall be considered final,
binding and conclusive upon the Investor and the DC Contributors; or

 

(iii)          The Investor may dispute any
portion of the Cash/Debt Indemnification Statement , but only on the basis that
the amounts set forth therein (A) have not been determined in accordance
with the definitions of Entity Cash Amount and Entity Debt Amount or (B) have
been determined as a result of a clerical or mathematical error, provided that
the Investor shall have given notice of such dispute to the DC Contributors
within 30 days of the receipt by the Investor of the Cash/Debt Indemnification
Statement and shall have listed in such notice for each disputed item, in
reasonable detail, the basis for such dispute. 
All amounts not so disputed in the notice delivered by the Investor to
the DC Contributors shall be considered final, binding and conclusive on the
Investor and the DC Contributors.  The
Investor and the DC Contributors shall work in good faith to attempt to resolve
these differences.  If, within 30 days
after the delivery of the Investor’s notice to the DC Contributors, the
Investor and the DC Contributors are unable to resolve any differences arising
as a result of the Cash/Debt Indemnification Statement, the DC Contributors and
the Investor shall submit the items remaining in dispute for resolution to a
mutually agreeable independent accounting firm. 
If the parties are unable to agree on such accounting firm or such
accounting firm shall decline or is unable to act or is not, at the time of
such submission, independent of the DC Contributors and the Investor, and if
the DC Contributors and the Investor are unable to agree on another independent
accounting firm of international reputation within 10 days of the failure to
appoint such accounting firm, the DC Contributors and the Investor shall submit
the items remaining in dispute for resolution to such other independent
accounting firm of international reputation as is selected by the DC
Contributor’s Accounting Firm and the Investor’s Accounting Firm or such other
accounting firm as is agreed by the DC Contributors and the Investor (in each
case, being referred to herein as the “Independent Accounting Firm”),
shall, within 30 days after such submission, or within such other time period
as the Independent Accounting Firm may decide, determine and report to the DC
Contributors and the Investor upon such remaining disputed items, and such

 

93

 

report shall be final,
binding and conclusive on the DC Contributors and the Investor.  The fees and disbursements of the Independent
Accounting Firm shall be allocated between the DC Contributors and the Investor
in the same proportion that the aggregate amount of such remaining disputed
items so submitted to the Independent Accounting Firm that is unsuccessfully
disputed by each such party (as finally determined by the Independent
Accounting Firm) bears to the total amount of such remaining disputed items so
submitted.

 

(iv)          If the final Cash/Debt
Indemnification Amount has not been determined prior to the Closing, upon final
determination of the Cash/Debt Indemnification Amount, DCNAF shall pay such
amount to an account designated by the Investor by wire transfer of immediately
available funds within five Business Days of the final determination of the
Cash/Debt Indemnification Amount.

 

SECTION 9.03.  Indemnification by the Investor.  (a) The DC Contributors and their
Affiliates, officers, directors, employees, agents, successors and assigns
(each, a “DC Contributors Indemnified Party”) shall be indemnified and
held harmless by the Investor for and against any and all Losses, arising out
of or resulting from:

 

(i)            the breach of
any representation or warranty made by the Investor contained in this Agreement
or made in the certificate delivered pursuant to Section 8.01(a); or

 

(ii)           the breach of
any covenant or agreement by the Investor contained in this Agreement;

 

(b)           The Investor shall cause the
Company and the Company Subsidiaries to indemnify and hold harmless each
relevant DC Contributors Indemnified Party for and against any and all Losses,
arising out of or resulting from any claim or cause of action by any Person
arising before or after the Closing against any DC Contributors Indemnified
Party with respect to the operations of the Company, any Company Subsidiary or
the Company Business, except for claims or causes of action with respect to
which the DC Contributors are obligated to indemnify the Investor Indemnified
Parties pursuant to Section 9.02.

 

SECTION 9.04.  Limits on Indemnification.  (a) No claim may be asserted nor may any
Action be commenced against either party for breach of any representation,
warranty, covenant or agreement contained herein, unless written notice of such
claim or action is received by such party describing in reasonable detail, to
the extent known to such party, the facts and circumstances with respect to the
subject matter of such claim or Action on or prior to the date on which the
representation, warranty, covenant or agreement on which such claim or Action
is based ceases to survive as set forth in Section 9.01 (or, if such claim
or Action is in respect of a pre-Closing breach of Section 5.01, on or
prior to the 12-month anniversary of the Closing Date), irrespective of whether
the subject matter of such claim or action shall have occurred before or after
such date.

 

94

 

(b)           Notwithstanding anything to
the contrary contained in this Agreement: 
(i) an Indemnifying Party shall not be liable for any claim for
indemnification pursuant to Section 9.02(a)(i) or Section 9.03(a)(i),
unless and until the aggregate amount of indemnifiable Losses that may be
recovered from the Indemnifying Party equals or exceeds $50 million, after
which the Indemnifying Party shall be liable only for those Losses in excess of
$50 million, (ii) no Losses may be claimed under Section 9.02(a)(i) or
Section 9.03(a)(i) by any Indemnified Parties or shall be
reimbursable by or shall be included in calculating the aggregate Losses set
forth in clause (i) above other than Losses in excess of $5 million
resulting from any single claim or aggregated claims arising out of the same
facts, events or circumstances, (iii) the maximum amount of indemnifiable
Losses which may be recovered from an Indemnifying Party arising out of or
resulting from the causes set forth in Section 9.02(a)(i), Section 9.02(a)(ii)(only
with respect to breaches of the covenants contained in Section 5.01(a)(i)-(iii) and
(vi)) and Section 9.03(a)(i) shall be an amount equal to $600
million, and (iv) no party hereto shall have any liability under any
provision of this Agreement or any Ancillary Agreement for any punitive,
incidental, or consequential (including any measure of Losses that would result
from the application of a multiplier) damages relating to the breach or alleged
breach of this Agreement or any Ancillary Agreement (except to the extent such
damages are payable in connection with a Third Party Claim), and (v) no
breach by any of the parties hereto of any representation or warranty contained
in this Agreement shall be deemed to be a breach of this Agreement for any
purpose hereunder, and no party hereto nor any Affiliate of any party hereto
shall have any claim or recourse, in each case under this Agreement, against
the DC Contributors or the Investor, as applicable, or their respective
directors, officers, employees, Affiliates, agents, advisors or representatives
with respect to such breach, if such party or any Affiliate of such party had,
to the Investor’s Knowledge or the DC Contributors’ Knowledge, respectively,
prior to the execution of this Agreement, knowledge of such breach except to
the extent that such knowledge was derived directly from any written materials
delivered to the Investor or its Affiliates and their respective
representatives by the DC Contributors or their Affiliates or their respective
representatives or accessed by the Investor or its Affiliates and their
respective representatives in the Electronic Data Room on or prior to
11.59 p.m. on May 10, 2007; provided that the limitations set forth
in clause (iii) of this Section 9.04(b) shall not apply to a
claim relating to any breach of any representation or warranty (x) set
forth in Section 3.01, 3.02, 3.03, 4.01 or 11.10 or (y) that
constitutes fraud; provided, further, that the limitations set
forth in clauses (i) and (ii) of this Section 9.04(b) shall
not apply to a claim relating to any breach of any representation or warranty
set forth in Section 3.06(g).

 

(c)           For all purposes of this Article IX,
“Losses” shall only be net of any actual insurance recoveries paid to
the Indemnified Party or its Affiliates in connection with the facts giving
rise to the right of indemnification and shall be reduced by the amount of any
reduction in Taxes otherwise payable at the time (whether currently or in a
later period) actually realized by the Indemnified Party that arises from such
Loss.

 

(d)           Notwithstanding anything to
the contrary contained in this Agreement, solely for purposes of this Article IX,
(x) the determination of whether there has been any breach of any
representation or warranty of the DC Contributors or the Guarantor contained in
this Agreement shall be determined without regard to any materiality, Company
Material Adverse Effect, DC Contributors Material Adverse Effect or Guarantor
Material Adverse Effect standard or qualification set forth therein (other than
the definitions contained in Section 1.01 and the

 

95

 

representations and
warranties listed on Schedule 9.04(d), where, for the avoidance of doubt, such
standards or qualifiers shall not be disregarded to the extent indicated on
Schedule 9.04(d)) and (y) the determination of the amount of any Losses
for which an Investor Indemnified Party shall be entitled to indemnification
under this Article IX by reason of any such breach referred to in clause (x) above,
shall be determined without regard to any materiality, Company Material Adverse
Effect, DC Contributors Material Adverse Effect or Guarantor Material Adverse
Effect standard or qualification set forth therein (other than the definitions
contained in Section 1.01 and the representations and warranties listed on
Schedule 9.04(d), where, for the avoidance of doubt, such standards or
qualifiers shall not be disregarded to the extent indicated on Schedule
9.04(d)).

 

SECTION 9.05.  Notice of Loss; Third Party Claims.  (a) An Indemnified Party shall give the
Indemnifying Party notice of any matter which an Indemnified Party has
determined has given or could give rise to a right of indemnification under
this Agreement, stating the amount of the Loss, if known, and method of
computation thereof, and containing a reference to the provisions of this
Agreement in respect of which such right of indemnification is claimed or
arises.

 

(b)           If an Indemnified Party
shall receive notice of any Action, audit, claim, demand or assessment (each, a
“Third Party Claim”) against it which may give rise to a claim for Loss
under this Article IX, within 30 days of the receipt of such notice, the
Indemnified Party shall give the Indemnifying Party notice of such Third Party
Claim; provided,  however, that the failure to provide such notice
shall not release the Indemnifying Party from any of its obligations under this
Article IX except to the extent that such failure results in a material
detriment to the Indemnifying Party and shall not relieve the Indemnifying
Party from any other Liability that it may have to any Indemnified Party other
than under this Article IX.  The
Indemnifying Party shall be entitled to assume and control the defense of such
Third Party Claim at its expense and through counsel of its choice if it gives
notice of its intention to do so to the Indemnified Party within 30 days of the
receipt of such notice from the Indemnified Party.  If the Indemnifying Party elects to undertake
any such defense against a Third Party Claim, the Indemnified Party may
participate in such defense at its own expense. 
The Indemnified Party shall cooperate with the Indemnifying Party in
such defense and make available to the Indemnifying Party, at the Indemnifying
Party’s expense, all witnesses, pertinent records, materials and information in
the Indemnified Party’s possession or under the Indemnified Party’s control
relating thereto as is reasonably required by the Indemnifying Party.  If the Indemnifying Party elects to direct
the defense of any such claim or proceeding, the Indemnified Party shall not
pay, or permit to be paid, any part of such Third Party Claim unless the
Indemnifying Party consents in writing to such payment or unless the
Indemnifying Party withdraws from the defense of such Third Party Claim or
unless a final judgment from which no appeal may be taken by or on behalf of
the Indemnifying Party is entered against the Indemnified Party for such Third
Party Claim.  If the Indemnified Party
assumes the defense of any such claims or proceeding pursuant to this Section 9.05
it shall not settle such claims or proceeding prior to a final judgment thereon
or forgo any appeal with respect thereto without the prior written consent of
the Indemnifying Party (which consent shall not be unreasonably withheld or
delayed).

 

SECTION 9.06.  Remedies.  The Investor and the DC Contributors
acknowledge and agree that (a) following the Closing, the indemnification
provisions of Section 9.02 and

 

96

 

Section 9.03 shall be
the sole and exclusive remedies of the Investor and the DC Contributors for any
breach by the DC Contributors and the Investor, respectively, of the
representations and warranties in this Agreement and for any failure by the DC
Contributors and the Investor, respectively, to perform and comply with any
covenants and agreements in this Agreement, except that if any of the
provisions of this Agreement are not performed in accordance with their terms
or are otherwise breached, the parties shall be entitled to specific
performance of the terms thereof in addition to any other remedy at law or
equity, and (b) anything herein to the contrary notwithstanding, no breach
of any representation, warranty, covenant or agreement contained herein of any
of the parties shall give rise to any right on the part of the Investor or the
DC Contributors, after the consummation of the purchase and sale of the
Investor Equity Interests contemplated by this Agreement, to rescind this
Agreement or any of the transactions contemplated hereby.  Each party, after becoming aware of any event
which could reasonably be expected to give rise to any Losses that have or
could give rise to a right of such party to indemnification under this Article IX,
shall take all reasonable steps to mitigate such Losses.

 

SECTION 9.07.  Tax Matters.  Anything in this Article IX to the
contrary notwithstanding, the rights and obligations of the parties with
respect to indemnification for any and all Tax matters (including, for the avoidance
of doubt, in relation to Section 3.16) shall be governed solely by Article VII
and shall not be subject to the provisions of this Article IX.

 

ARTICLE X

 

TERMINATION;
EFFECT OF TERMINATION

 

SECTION 10.01.  Termination.  This Agreement may be terminated at any time
prior to the Closing:

 

(a)           by either the DC
Contributors or the Investor if the Closing shall not have occurred by April 30,
2008; provided,  however, that the right to terminate this
Agreement under this Section 10.01(a) shall not be available to any
party whose failure to fulfill any obligation under this Agreement shall have
been the cause of, or shall have resulted in, the failure of the Closing to
occur on or prior to such date;

 

(b)           by either the Investor or
the DC Contributors in the event that any Governmental Order permanently
restraining, enjoining or otherwise permanently prohibiting the transactions
contemplated by this Agreement shall have become final and nonappealable;

 

(c)           by the Investor, if there
has been a material violation or breach by the DC Contributors or the Guarantor
of any covenant, representation or warranty contained in this Agreement such
that the condition to the obligations of the Investor at Closing set forth in Section 8.02
is incapable of being satisfied and such violation or breach has not been
waived by the Investor and such violation or breach is not curable;

 

(d)           by the DC Contributors, if
there has been a material violation or breach by the Investor of any covenant,
representation or warranty contained in this Agreement such that the condition
to the obligations of the DC Contributors at Closing set forth in Section 8.01
is

 

97

 

incapable of being satisfied
and such violation or breach has not been waived by the DC Contributors, and
such violation or breach is not curable;

 

(e)           by either the DC
Contributors or the Investor, if this Agreement and the transactions
contemplated hereby shall fail to be approved by the Supervisory Board of the
Guarantor on or before May 19, 2007; or

 

(f)            by the mutual written
consent of the DC Contributors and the Investor.

 

SECTION 10.02.  Effect of Termination.  (a) In the event of termination of this
Agreement as provided in Section 10.01, this Agreement shall forthwith
become void and there shall be no liability on the part of any party hereto
except (a) as set forth in Section 5.03, this Section 10.02 and Article XI,
and (b) that nothing herein shall relieve either party from liability for
any breach of this Agreement occurring prior to such termination.

 

(b)           In the event that (i) the
Investor or any of its Affiliates refuses to either agree to sell, divest,
dispose of or hold separate any assets or businesses, or otherwise take or
commit to take any action that limits its ability to retain one or more of its
or its Affiliates’ businesses, product lines or assets, (ii) such refusal
results in the condition to the obligations of the Investor at Closing set
forth in Section 8.02(b)(i) not being satisfied, (iii) this
Agreement is terminated in accordance with Section 10.01(a) or (b) because
the Closing has not occurred solely as a result of the non-satisfaction of such
condition, and (iv) at the time of such termination, the DC Contributors
and Guarantor are not in material breach of any of their covenants or
agreements under this Agreement, then the Investor shall pay to DC Holding or
any entity designated by DC Holding, within five (5) Business Days of the
termination of this Agreement, an amount equal to $300 million by wire transfer
of immediately available funds to an account designated by DC Holding.

 

(c)           In the event that (i) the
Investor shall have failed to receive the Debt Financing in an aggregate amount
sufficient to refinance the Indebtedness of the Financial Services Companies
(and pay any out-of-pocket, third-party fees and expenses payable in connection
therewith), (ii) this Agreement is terminated in accordance with Section 10.01(a),
(iii) all conditions to the obligations of the Investor and the DC
Contributors at Closing contained in Article VIII have been satisfied
other than (A) the condition contained in Section 8.02(g) and (B) those
conditions that, by their terms, cannot be satisfied until the Closing and (iv) at
the time of such termination, the DC Contributors and the Guarantor are not in
material breach of any of their covenants or agreements under this Agreement,
then the Investor shall pay to DC Holding or any entity designated by DC
Holding, within five (5) Business Days of the termination of this
Agreement, an amount equal to $100 million by wire transfer of immediately
available funds to an account designated by DC Holding.

 

(d)           In the event that (i) the
Supervisory Board of the Guarantor shall have failed to approve this Agreement
and the transactions contemplated hereby on or before May 19, 2007, and (ii) this
Agreement is terminated in accordance with Section 10.01(e), then the DC
Contributors shall pay to the Investor or any entity designated by the
Investor, within five (5) Business Days of the termination of this
Agreement, on account of costs and expenses an amount equal to $100 million by
wire transfer of immediately available funds to an account designated

 

98

 

by the Investor and the
obligations of the Guarantor set forth in Section 11.10(e) shall
survive the termination of this Agreement pursuant to Section 10.01(e) for
a period of 60 days following such termination.

 

ARTICLE XI

 

GENERAL
PROVISIONS

 

SECTION 11.01.  Expenses.  Except as otherwise specified in this
Agreement, all costs and expenses, including fees and disbursements of counsel,
financial advisors and accountants incurred in connection with this Agreement
and the transactions contemplated by this Agreement shall be borne by the party
incurring such costs and expenses, whether or not the Closing shall have
occurred.

 

SECTION 11.02.  Notices.  All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be given or made
(and shall be deemed to have been duly given or made upon receipt) by delivery
in person, by an internationally recognized overnight courier service or by
facsimile (with a copy simultaneously sent by overnight courier service) to the
respective parties hereto at the following addresses (or at such other address
for a party as shall be specified in a notice given in accordance with this Section 11.02):

 

(a)           if to the DC Contributors or
to the Guarantor:

 

	
  DaimlerChrysler AG

  Mercedesstraße 137

  70327 Stuttgart

  Germany

  Telecopy: +49 711 17 944 98

  Attention: Gerd T. Becht

  
	
   

  
	
  with a copy to:

  
	
   

  
	
  Shearman &
  Sterling LLP

  599 Lexington Ave.

  New York, NY 10022

  United States of America

  Telecopy: +1 212.848.7179

  Attention: W. Jeffrey Lawrence

  

 

99

 

(b)           if to the Investor:

 

	
  c/o Cerberus Capital
  Management L.P.

  299 Park Avenue

  New York, NY 10171

  United States of America

  Telecopy: +1 212.750 5212

  Attention: Lenard B. Tessler

  	
   

  
	
   

  	
  Frank Bruno

  	
   

  
	
   

  	
  Mark Neporent

  	
   

  
	
   

  	
  Seth P. Plattus

  	
   

  
	
   

  	
  Dev B. Kapadia

  	
   

  
	
   

  	
  Robert Warden

  	
   

  
	
   

  	
  Seth Gardner

  	
   

  

 

	
  with a copy to:

  
	
   

  
	
  Schulte Roth &
  Zabel LLP

  919 Third Avenue

  New York, NY 10022

  Telecopy: +1 212.593.5955

  Attention: Marc Weingarten

  

 

SECTION 11.03.  Public Announcements.  Neither party to this Agreement shall make,
or cause to be made, any press release or public announcement in respect of
this Agreement or the transactions contemplated by this Agreement or otherwise
communicate with any news media without the prior written consent of the other
party unless otherwise required by Law or applicable stock exchange regulation
(in which case the disclosing party shall give the other parties reasonable
prior notice under the circumstances of the proposed timing and contents of the
disclosure required to be made thereunder and reasonable opportunity to
comment), and the parties to this Agreement shall cooperate as to the timing
and contents of any such press release, public announcement or communication.

 

SECTION 11.04.  Severability.  If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any Law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect for so long as the economic or
legal substance of the transactions contemplated by this Agreement is not
affected in any manner materially adverse to any party hereto.  Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner in order that the transactions contemplated by this Agreement are
consummated as originally contemplated to the greatest extent possible.

 

SECTION 11.05.  Entire Agreement.  This Agreement, the Ancillary Agreements and
the Confidentiality Agreement constitute the entire agreement of the parties
hereto with respect to the subject matter hereof and thereof and supersede all
prior agreements and

 

100

 

undertakings, both written
and oral, between the DC Contributors and the Investor with respect to the
subject matter hereof and thereof.

 

SECTION 11.06.  Assignment.  This Agreement may not be assigned by operation
of law or otherwise without the express written consent of the DC Contributors
and the Investor (which consent may be granted or withheld in the sole
discretion of the DC Contributors or the Investor), as the case may be; provided,
however, that each of the DC Contributors and the Investor shall be
permitted to assign its rights hereunder to any of its Affiliates; provided,
further, that no such assignment shall relieve the DC Contributors or
the Investor of their respective obligations hereunder; and provided,  further,
that the Investor may assign or grant security interests in this Agreement and
its rights hereunder, and under the Ancillary Agreements and other agreements
and documents delivered pursuant hereto and thereto, to lenders, noteholders,
or agents or trustees on their behalf in connection with the Financing.

 

SECTION 11.07.  Amendment.  This Agreement may not be amended or modified
except (a) by an instrument in writing signed by, or on behalf of, the DC
Contributors and the Investor, or (b) by a waiver in accordance with Section 11.08.

 

SECTION 11.08.  Waiver.  Each party to this Agreement may (a) extend
the time for the performance of any of the obligations or other acts of another
party, (b) waive any inaccuracies in the representations and warranties of
another party contained herein or in any document delivered by the other party
pursuant hereto, or (c) waive compliance with any of the agreements of
another party or conditions to such party’s obligations contained herein.  Any such extension or waiver shall be valid
only if set forth in an instrument in writing signed by the party to be bound
thereby.  Any waiver of any term or
condition shall not be construed as a waiver of any subsequent breach or a subsequent
waiver of the same term or condition, or a waiver of any other term or
condition of this Agreement.  The failure
of any party hereto to assert any of its rights hereunder shall not constitute
a waiver of any of such rights.

 

SECTION 11.09.  No Third Party Beneficiaries.  This Agreement shall be binding upon and
inure solely to the benefit of the parties hereto and their respective
successors and permitted assigns and nothing herein, express or implied
(including the provisions of Article IX relating to indemnified parties),
is intended to or shall confer upon any other Person any legal or equitable
right, benefit or remedy of any nature whatsoever, including any rights of
employment for any specified period, under or by reason of this Agreement.

 

SECTION 11.10.  Guarantee.  (a) The Guarantor shall cause the DC
Contributors to perform, satisfy and discharge each of the covenants,
obligations and liabilities of the DC Contributors under this Agreement and
irrevocably, absolutely and unconditionally guarantees the prompt performance
of the DC Contributors in respect thereof and hereby agrees to pay any and all
expenses (including counsel and other out-of-pocket fees and expenses) incurred
by the Investor in enforcing its rights under this Section 11.10.  In connection therewith, the Guarantor hereby
waives, to the fullest extent permitted by applicable Law: (i) promptness
and diligence of the Purchaser with respect to the enforcement of its rights
under this Agreement; (ii) notice of acceptance and notice of the
incurrence of any covenant, obligation or liability by the DC Contributors
under of this Agreement; (iii) notice of any actions taken by the Investor
under this Agreement; (iv) all other notices, demands and protests, and
all other formalities of every kind in

 

101

 

connection with the
enforcement of the obligations of the Guarantor under this Section 11.10,
the omission of or delay in which, but for this clause, might constitute
grounds for relieving the Guarantor of its obligations hereunder; (v) any
requirement that the Investor exhaust any right or take any action against the
DC Contributors or any other Person; and (vi) any other defense available
to the Guarantor. In addition, the Guarantor hereby unconditionally and
irrevocably (A) subordinates all rights it may have at any time or from
time to time (whether arising directly or indirectly by operation of law or
contract) to be subrogated to the rights of the Investor as a result of any
claim or payment made on or in respect of this Section 11.10 prior to the
expiration of the survival periods set forth in Section 9.01 and the
resolution of all claims asserted during such periods and (B) waives any
defense based upon an election of remedies by the Investor which destroys or
otherwise impairs any subrogation rights of the Guarantor and/or the right of
the Guarantor to proceed against the DC Contributors for reimbursement.  Other than as set forth in Section 5.03
and this Section 11.10, the Guarantor shall have no obligations or
liabilities under this Agreement.

 

(b)           Organization, Authority and
Qualification.  The
Guarantor hereby represents and warrants to the Investor as follows: (i) the
Guarantor is a corporation duly organized, validly existing and, if such
concept is applicable, in good standing under the laws of the Federal Republic
of Germany; (ii) subject to receipt of the approval of its Supervisory
Board, the Guarantor has all necessary corporate power and authority to enter
into this Agreement and the Ancillary Agreements (if any) to which it is or
will be a party, to carry out its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby; (iii) subject
to receipt of the approval of its Supervisory Board, the execution and delivery
by the Guarantor of this Agreement and the Ancillary Agreements to which it is
or will be a party, the performance by the Guarantor of its obligations
hereunder and thereunder and the consummation by the Guarantor of the
transactions contemplated hereby and thereby have been duly authorized by all
requisite action on the part of the Guarantor; (iv) subject to receipt of
the approval of its Supervisory Board, this Agreement has been, and, upon their
execution, the Ancillary Agreements to which the Guarantor is or will be a
party, shall have been, duly executed and delivered by the Guarantor; and (v) assuming
due authorization, execution and delivery by the other parties hereto or
thereto, as applicable, and subject to receipt of the approval of its
Supervisory Board, this Agreement constitutes, and, upon their execution, the
Ancillary Agreements to which the Guarantor is or will be a party, shall
constitute, legal, valid and binding obligations of the Guarantor, enforceable
against the Guarantor in accordance with their respective terms, subject to the
effect of any applicable bankruptcy, insolvency (including all Laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting
creditors’ rights generally and subject to the effect of general principles of
equity (regardless of whether considered in a proceeding at law or in equity).

 

(c)           No Conflict.  The Guarantor hereby represents and warrants
to the Investor as follows: assuming that all consents, approvals,
authorizations and other actions described in Section 3.05 have been
obtained, all filings and notifications listed in Section 3.05 of the DC
Contributors Disclosure Schedule have been made and any applicable waiting
period has expired or been terminated, and except as may result from any facts
or circumstances relating solely to the Investor or its Affiliates, the
execution, delivery and performance by the Guarantor of this Agreement and the
Ancillary Agreements to which the Guarantor is or will be a party, do not and
will not (i) violate, conflict with or result in the breach of any
provision of the

 

102

 

Fundamental Documents of the
Guarantor, (ii) conflict with or violate any Law or Governmental Order
applicable to the Guarantor, (iii) except as set forth in Section 11.10(c) of
the DC Contributors Disclosure Schedule, conflict with, result in any breach
of, constitute a default (or event which with the giving of notice or lapse of
time, or both, would become a default) under, require any consent under, or
give to others any rights of termination, amendment, payment, acceleration or
cancellation of, any note, bond, mortgage or indenture, contract, agreement,
lease, sublease, license, permit, franchise or other instrument or arrangement to
which the Guarantor is a party, or (iv) result in the creation of any
Encumbrances upon the assets of the Guarantor, except, in the case of clauses
(ii), (iii) and (iv), as would not, individually or in the aggregate, have
a Guarantor Material Adverse Effect.

 

(d)           Governmental Consents and
Approvals.  The
Guarantor hereby represents and warrants to the Investor that the execution,
delivery and performance by the Guarantor of this Agreement and the Ancillary
Agreements to which the Guarantor is or will be a party do not and will not
require any consent, approval, authorization or other order of, action by,
filing with or notification to, any Governmental Authority, except (i) as
set forth in Section 11.10(d) of the DC Contributors Disclosure
Schedule, (ii) the pre-merger notification and waiting period requirements
of the HSR Act, (iii) the requirements of the Antitrust Laws of any other
relevant jurisdiction, except where such failures to obtain such consents,
approvals, authorizations or actions, or to make such filings or notifications,
would not, individually or in the aggregate, have a Guarantor Material Adverse
Effect, or (iv) as may be necessary as a result of any facts or
circumstances relating solely to the Investor or its Affiliates.

 

(e)           Nonsolicitation of
Acquisition Proposal.  The
Guarantor shall not, nor shall it authorize or knowingly permit any of its
Subsidiaries or any of their respective directors, officers, employees,
investment bankers, financial advisors, attorneys, accountants or other advisors,
agents or representatives (collectively, “Representatives”) to, directly
or indirectly through another Person, (i) solicit, initiate or knowingly
encourage, or take any other action designed to, or which could reasonably be
expected to, encourage any Acquisition Proposal or (ii) enter into,
continue or otherwise participate in any negotiations or agreements regarding,
or furnish or disclose to any Person any information in furtherance of, or
otherwise cooperate in any way with, any Acquisition Proposal.  The Guarantor shall, and shall cause its
Subsidiaries and Representatives to, immediately cease and cause to be
terminated all existing discussions or negotiations with any Person conducted
heretofore with respect to any Acquisition Proposal and request the prompt
return or destruction of all confidential information previously furnished.

 

SECTION 11.11.  Currency.  Unless otherwise specified in this Agreement,
all references to currency, monetary values and dollars set forth herein shall
mean United States (U.S.) dollars and all payments hereunder shall be made in
United States dollars.

 

SECTION 11.12.  Governing Law.  This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.

 

SECTION 11.13.  Consent to Jurisdiction.  Subject to the provisions of Section 9.02(b)(iii) (which
govern any dispute arising thereunder), each of the parties hereto (a) consents
to submit itself to the personal jurisdiction of any federal or state court
located in the Borough of Manhattan in the State of New York in the event any
dispute arises out of or relates to this

 

103

 

Agreement, (b) agrees
that it will not attempt to deny or defeat such personal jurisdiction by motion
or other request for leave from any such court, including a motion to dismiss
on the grounds of forum non conveniens, (c) agrees that it will not bring
any action arising out of or relating to this Agreement in any court other than
a federal court sitting in the Borough of Manhattan in the State of New York or
a New York state court, and (d) WAIVES ANY RIGHT TO A TRIAL BY JURY WITH
RESPECT TO ANY CLAIM, COUNTERCLAIM OR ACTION ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION 11.14.  Counterparts.  This Agreement may be executed and delivered
(including by facsimile transmission) in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when executed
shall be deemed to be an original, but all of which taken together shall
constitute one and the same agreement.

 

SECTION 11.15.  Certain Company-Related Actions.  Whenever this Agreement requires a DC
Contributor or the Investor, from and after the Closing, to cause the Company
or any Company Subsidiary to take any action, or to honor or assume, or be
responsible for, any obligation or liability, such requirement shall be deemed
to involve an undertaking on the part of such Person, solely in its capacity as
a holder of Company Equity Units, to approve, or vote in favor of, or otherwise
direct the taking of, such actions, or the honoring or assumption of, or
acceptable of responsibility for, such obligation or liability, by the Company
or such Company Subsidiary and shall not constitute a guarantee of performance
of such actions, or the guarantee of payment of such obligation or liability,
by the Company or such Company Subsidiary.

 

SECTION 11.16.  Additional Diligence.  The items marked with an asterisk on the DC
Contributors Disclosure Schedule and including item 56 of Section 3.09
thereof shall be deemed not set forth therein. 
The Investor agrees to review such matters within 21 days following the
date hereof at which time such matters shall be deemed disclosed in the DC Contributors
Disclosure Schedule as of the date hereof except for (a) in the case of
any such items that relate to representations and warranties any matter
reasonably determined by the Investor to have a materially negative impact on
the Company and its Subsidiaries, taken as a whole, and (b) in the case of
any such items that relate to covenants, any item as to which the Investor
notifies the DC Contributors (in which case the parties shall endeavor to
discuss such item in good faith for a period of 30 additional days, at the end
of which time, such item shall be deemed disclosed).

 

104

 

IN
WITNESS WHEREOF, the DC Contributors and the Investor have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.

 

	
   

  	
  DAIMLERCHRYSLER NORTH
  AMERICAN

  
	
   

  	
  FINANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerd T. Becht

  	
   

  
	
   

  	
   

  	
  Name: Gerd T. Becht

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Edgar Krökel

  	
   

  
	
   

  	
   

  	
  Name: Edgar Krökel

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DAIMLERCHRYSLER HOLDING

  
	
   

  	
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Dr. Rüdiger
  Grube

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Herbert Kaufmann

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CG INVESTOR, LLC

  
	
   

  	
  By:
  Cerberus Capital Management, L.P., as

  Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Lenard B. Tessler

  
	
   

  	
   

  	
  Title:   Managing Director

  

 

 

IN
WITNESS WHEREOF, the DC Contributors and the Investor have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.

 

	
   

  	
  DAIMLERCHRYSLER NORTH
  AMERICAN

  
	
   

  	
  FINANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Gerd T. Becht

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Edgar Krökel

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DAIMLERCHRYSLER HOLDING

  
	
   

  	
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Rüdiger Grube

  	
   

  
	
   

  	
   

  	
  Name: Dr. Rüdiger
  Grube

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Herbert Kaufmann

  	
   

  
	
   

  	
   

  	
  Name: Herbert Kaufmann

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CG INVESTOR, LLC

  
	
   

  	
  By:
  Cerberus Capital Management, L.P., as

  Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Lenard B. Tessler

  
	
   

  	
   

  	
  Title:   Managing Director

  

 

 

IN
WITNESS WHEREOF, the DC Contributors and the Investor have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.

 

	
   

  	
  DAIMLERCHRYSLER NORTH
  AMERICAN

  
	
   

  	
  FINANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Gerd T. Becht

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Edgar Krökel

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DAIMLERCHRYSLER HOLDING

  
	
   

  	
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Rüdiger Grube

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Herbert Kaufmann

  
	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CG INVESTOR, LLC

  
	
   

  	
  By:
  Cerberus Capital Management, L.P., as

  Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lenard B. Tessler

  	
   

  
	
   

  	
   

  	
  Name: Lenard B. Tessler

  
	
   

  	
   

  	
  Title:   Managing Director

  

 

 

	
   

  	
  With respect to Section
  5.03 (Confidentiality) and

  Section 11.10 (Guarantee):

  
	
   

  	
   

  
	
   

  	
  DAIMLERCHRYSLER AG

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dieter Zetsche

  	
   

  
	
   

  	
   

  	
  Name: Dr. Dieter
  Zetsche

  
	
   

  	
   

  	
  Title:   Chairman of the Board of Management

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bodo Uebber

  	
   

  
	
   

  	
   

  	
  Name: Bodo Uebber

  
	
   

  	
   

  	
  Title:   Member of the Board of Management

  

 

 

(This page has
been left blank intentionally.)

 

 

Execution Version

 

 

$2,000,000,000

 

SECOND LIEN TERM LOAN AGREEMENT

 

among

 

CARCO INTERMEDIATE HOLDCO II LLC

 

CHRYSLER LLC,

 

The Several Lenders from Time to Time Parties Hereto,

 

JPMORGAN CHASE BANK, N.A.

as Administrative Agent,

 

GOLDMAN SACHS CREDIT PARTNERS L.P., and CITIBANK, N.A.

as Syndication Agents,

 

BEAR, STEARNS & CO. INC., and MORGAN STANLEY SENIOR FUNDING,
INC.,

as
Documentation Agents

 

Dated
as of August 3, 2007

 

	
  J.P. MORGAN SECURITIES INC.

  	
   

  	
  GOLDMAN SACHS CREDIT

  PARTNERS L.P.

  	
   

  	
  CITIGROUP GLOBAL MARKETS INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  .

  	
   

  	
  As Lead Arrangers,

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  and

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  J.P. MORGAN SECURITIES INC.

  	
   

  	
  CITIGROUP GLOBAL MARKETS

  INC.

  	
   

  	
  GOLDMAN SACHS CREDIT

  PARTNERS L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BEAR, STEARNS & CO. INC.

  	
   

  	
  MORGAN STANLEY SENIOR FUNDING, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  as Bookrunners

  	
   

  	
   

  

 

 

 

TABLE OF
CONTENTS

 

	
   

  	
   

  	
  Page

  
	
  SECTION 1

  	
  DEFINITIONS

  	
  1

  
	
   

  	
  1.1.

  	
  Defined
  Terms

  	
  1

  
	
   

  	
  1.2.

  	
  Other
  Definitional Provisions

  	
  29

  
	
   

  	
  1.3.

  	
  Conversion
  of Foreign Currencies

  	
  30

  
	
   

  	
   

  	
   

  
	
  SECTION 2

  	
  AMOUNT
  AND TERMS OF COMMITMENTS

  	
  30

  
	
   

  	
   

  	
   

  
	
   

  	
  2.1.

  	
  Term
  Commitments

  	
  30

  
	
   

  	
  2.2.

  	
  Procedure
  for Term Loan Borrowing

  	
  30

  
	
   

  	
  2.3.

  	
  Repayment
  of Term Loans

  	
  31

  
	
   

  	
  2.4.

  	
  Optional
  Prepayments

  	
  31

  
	
   

  	
  2.5.

  	
  Mandatory
  Prepayments

  	
  31

  
	
   

  	
  2.6.

  	
  Conversion
  and Continuation Options

  	
  32

  
	
   

  	
  2.7.

  	
  Limitations
  on Eurodollar Tranches

  	
  33

  
	
   

  	
  2.8.

  	
  Interest
  Rates and Payment Dates/Fee Payment Dates/Fees

  	
  33

  
	
   

  	
  2.9.

  	
  Computation
  of Interest and Fees

  	
  33

  
	
   

  	
  2.10.

  	
  Inability
  to Determine Interest Rate; Illegality

  	
  34

  
	
   

  	
  2.11.

  	
  Pro
  Rata Treatment and Payments; Evidence of Debt

  	
  34

  
	
   

  	
  2.12.

  	
  Requirements
  of Law

  	
  36

  
	
   

  	
  2.13.

  	
  Taxes

  	
  37

  
	
   

  	
  2.14.

  	
  Indemnity

  	
  39

  
	
   

  	
  2.15.

  	
  Change
  of Applicable Lending Office

  	
  39

  
	
   

  	
  2.16.

  	
  Replacement/Termination
  of Lenders

  	
  40

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  40

  
	
   

  	
   

  	
   

  
	
   

  	
  3.1.

  	
  Financial
  Condition

  	
  40

  
	
   

  	
  3.2.

  	
  No
  Change

  	
  41

  
	
   

  	
  3.3.

  	
  Existence

  	
  41

  
	
   

  	
  3.4.

  	
  Power;
  Authorization; Enforceable Obligations

  	
  41

  
	
   

  	
  3.5.

  	
  No
  Legal Bar

  	
  42

  
	
   

  	
  3.6.

  	
  Litigation

  	
  42

  
	
   

  	
  3.7.

  	
  No
  Default

  	
  42

  
	
   

  	
  3.8.

  	
  Ownership
  of Property

  	
  42

  
	
   

  	
  3.9.

  	
  Intellectual
  Property

  	
  42

  
	
   

  	
  3.10.

  	
  Federal
  Regulations

  	
  43

  
	
   

  	
  3.11.

  	
  ERISA

  	
  43

  
	
   

  	
  3.12.

  	
  Investment
  Company Act

  	
  44

  
	
   

  	
  3.13.

  	
  Subsidiaries;
  Pledged Equity; Joint Ventures

  	
  44

  
	
   

  	
  3.14.

  	
  Security
  Documents

  	
  44

  
	
   

  	
  3.15.

  	
  Environmental
  Laws

  	
  45

  
	
   

  	
  3.16.

  	
  Accuracy
  of Information, etc.

  	
  45

  
	
   

  	
  3.17.

  	
  Taxes

  	
  46

  
	
   

  	
  3.18.

  	
  Solvency

  	
  46

  
	
   

  	
  3.19.

  	
  Regulation
  H

  	
  46

  
	
   

  	
  3.20.

  	
  Certain
  Documents

  	
  46

  

 

i

 

	
  3.21.

  	
  Use of
  Proceeds

  	
  46

  
	
   

  	
   

  	
   

  
	
  SECTION 4

  	
  CONDITIONS
  PRECEDENT

  	
  46

  
	
   

  	
   

  	
   

  
	
  SECTION 5

  	
  AFFIRMATIVE
  COVENANTS

  	
  49

  
	
   

  	
   

  	
   

  
	
   

  	
  5.1.

  	
  Financial
  Statements

  	
  49

  
	
   

  	
  5.2.

  	
  Borrowing
  Base Certificate

  	
  50

  
	
   

  	
  5.3.

  	
  Compliance
  and Other Information

  	
  50

  
	
   

  	
  5.4.

  	
  Maintenance
  of Existence; Payment of Obligations; Compliance with Law

  	
  51

  
	
   

  	
  5.5.

  	
  Maintenance
  of Property; Insurance

  	
  52

  
	
   

  	
  5.6.

  	
  Notices

  	
  52

  
	
   

  	
  5.7.

  	
  Additional
  Collateral, etc.

  	
  53

  
	
   

  	
  5.8.

  	
  Environmental
  Laws

  	
  55

  
	
   

  	
  5.9.

  	
  Inspection
  of Property; Books and Records; Discussions

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6

  	
  NEGATIVE
  COVENANTS

  	
  56

  
	
   

  	
   

  	
   

  
	
   

  	
  6.1.

  	
  Borrowing
  Base

  	
  56

  
	
   

  	
  6.2.

  	
  Available
  Liquidity

  	
  56

  
	
   

  	
  6.3.

  	
  Liens

  	
  56

  
	
   

  	
  6.4.

  	
  Indebtedness

  	
  56

  
	
   

  	
  6.5.

  	
  Asset
  Sale Restrictions

  	
  56

  
	
   

  	
  6.6.

  	
  Restricted
  Payments

  	
  57

  
	
   

  	
  6.7.

  	
  Fundamental
  Changes

  	
  59

  
	
   

  	
  6.8.

  	
  Negative
  Pledge

  	
  59

  
	
   

  	
  6.9.

  	
  Sale/Leaseback
  Transactions

  	
  60

  
	
   

  	
  6.10.

  	
  Investments

  	
  60

  
	
   

  	
  6.11.

  	
  Transactions
  with Affiliates

  	
  61

  
	
   

  	
  6.12.

  	
  Swap
  Agreements

  	
  62

  
	
   

  	
  6.13.

  	
  Changes
  in Fiscal Periods

  	
  62

  
	
   

  	
  6.14.

  	
  Clauses
  Restricting Subsidiary Distributions

  	
  62

  
	
   

  	
  6.15.

  	
  Amendments
  to Acquisition Documentation

  	
  63

  
	
   

  	
  6.16.

  	
  Asset
  Sale Collateral Account/Borrowing Base Collateral Account

  	
  63

  
	
   

  	
   

  	
   

  
	
  SECTION 7

  	
  EVENTS
  OF DEFAULT

  	
  63

  
	
   

  	
   

  	
   

  
	
  SECTION 8

  	
  THE
  AGENTS

  	
  66

  
	
   

  	
   

  	
   

  
	
   

  	
  8.1.

  	
  Appointment

  	
  66

  
	
   

  	
  8.2.

  	
  Delegation
  of Duties

  	
  67

  
	
   

  	
  8.3.

  	
  Exculpatory
  Provisions

  	
  67

  
	
   

  	
  8.4.

  	
  Reliance
  by Administrative Agent

  	
  67

  
	
   

  	
  8.5.

  	
  Notice
  of Default

  	
  68

  
	
   

  	
  8.6.

  	
  Non-Reliance
  on Agents and Other Lenders

  	
  68

  
	
   

  	
  8.7.

  	
  Indemnification

  	
  69

  
	
   

  	
  8.8.

  	
  Agent
  in Its Individual Capacity

  	
  69

  
	
   

  	
  8.9.

  	
  Successor
  Administrative Agent

  	
  69

  
	
   

  	
  8.10.

  	
  Bookrunners,
  Lead Arrangers, Documentation Agents and Syndication Agents

  	
  70

  

 

ii

 

	
  SECTION 9

  	
  MISCELLANEOUS

  	
  70

  
	
   

  	
   

  	
   

  
	
   

  	
  9.1.

  	
  Amendments
  and Waivers

  	
  70

  
	
   

  	
  9.2.

  	
  Notices

  	
  71

  
	
   

  	
  9.3.

  	
  No Waiver;
  Cumulative Remedies

  	
  72

  
	
   

  	
  9.4.

  	
  Survival
  of Representations and Warranties

  	
  72

  
	
   

  	
  9.5.

  	
  Payment
  of Expenses

  	
  73

  
	
   

  	
  9.6.

  	
  Successors
  and Assigns; Participations and Assignments

  	
  74

  
	
   

  	
  9.7.

  	
  Adjustments;
  Set-off;

  	
  77

  
	
   

  	
  9.8.

  	
  Counterparts

  	
  77

  
	
   

  	
  9.9.

  	
  Severability

  	
  77

  
	
   

  	
  9.10.

  	
  Integration

  	
  77

  
	
   

  	
  9.11.

  	
  GOVERNING LAW

  	
  78

  
	
   

  	
  9.12.

  	
  Submission
  to Jurisdiction; Waivers

  	
  78

  
	
   

  	
  9.13.

  	
  Acknowledgements

  	
  78

  
	
   

  	
  9.14.

  	
  Releases
  of Guarantees and Liens

  	
  78

  
	
   

  	
  9.15.

  	
  Confidentiality

  	
  79

  
	
   

  	
  9.16.

  	
  WAIVERS OF JURY TRIAL

  	
  79

  
	
   

  	
  9.17.

  	
  USA
  Patriot Act

  	
  79

  

 

iii

 

	
  SCHEDULES:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1A

  	
  Commitments

  	
   

  
	
  1.1B

  	
  Borrowing
  Base

  	
   

  
	
  1.1D

  	
  Initial
  Subsidiary Guarantors

  	
   

  
	
  1.1E

  	
  Mortgaged
  Property

  	
   

  
	
  1.1F

  	
  Principal
  Trade Names

  	
   

  
	
  1.1G

  	
  Auburn
  Hills Property

  	
   

  
	
  1.1H

  	
  Real
  Estate Deliverables

  	
   

  
	
  3.13(a)

  	
  Pledged
  Equity

  	
   

  
	
  3.13(c)

  	
  Other
  Subsidiaries

  	
   

  
	
  4.1(b)(iii)

  	
  Certain
  Indebtedness and Liens

  	
   

  
	
  4.1(g)

  	
  Pledged
  Notes

  	
   

  
	
  4.1(h)

  	
  UCC
  Filings

  	
   

  
	
  5.7(d)

  	
  Post-Closing
  Deliverables

  	
   

  
	
  6.3

  	
  Permitted
  Liens

  	
   

  
	
  6.4

  	
  Permitted
  Indebtedness

  	
   

  
	
  6.5

  	
  Scheduled
  Dispositions

  	
   

  
	
  6.9

  	
  Certain
  Sale/Leaseback Transactions

  	
   

  
	
  6.11

  	
  Certain
  Agreements in Effect as of the Closing Date

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  A

  	
  Form of
  Security Agreement

  	
   

  
	
  B

  	
  Form of
  Collateral Trust Agreement

  	
   

  
	
  C

  	
  Form of
  Guarantee

  	
   

  
	
  D

  	
  Forms
  of Trademark Security Agreement, Copyright Security Agreement and Patent

  	
   

  
	
   

  	
  Security
  Agreement

  	
   

  
	
  E

  	
  Form of
  Mortgage

  	
   

  
	
  F

  	
  Form of
  Borrowing Base Certificate

  	
   

  
	
  G

  	
  Form of
  Closing Certificate

  	
   

  
	
  H

  	
  Form of
  Assignment and Assumption

  	
   

  
	
  I-1

  	
  Form of
  Legal Opinion of Schulte Roth & Zabel LLP

  	
   

  
	
  I-2

  	
  Form of
  Legal Opinion of In-House Counsel

  	
   

  
	
  J

  	
  Form of
  Exemption Certificate

  	
   

  
	
  K

  	
  Form of
  Addendum

  	
   

  
	
  L

  	
  Form of
  Compliance Certificate

  	
   

  
	
  M

  	
  Form of
  Term Note

  	
   

  

 

iv

 

SECOND LIEN TERM LOAN AGREEMENT (this “Agreement”),
dated as of August 3, 2007, among CARCO INTERMEDIATE HOLDCO II LLC, a
Delaware limited liability company (“Holdings”) CHRYSLER LLC, a Delaware
limited liability company (the “Company”), the several banks and other
financial institutions or entities from time to time parties hereto (the “Lenders”),
GOLDMAN SACHS CREDIT PARTNERS, L.P., and CITIBANK, N.A., as syndication agents
(in such capacity, the “Syndication Agents”), and JPMORGAN CHASE BANK,
N.A., as administrative agent.

 

The parties hereto hereby agree as follows:

 

SECTION 1            DEFINITIONS

 

1.1.          Defined
Terms.  As used in this Agreement,
the terms listed in this Section 1.1 shall have the respective meanings
set forth in this Section 1.1.

 

“ABR”: 
for any day, a rate per annum (rounded upwards, if necessary, to the
next 1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on
such day and (b) the Federal Funds Effective Rate in effect on such day
plus 1⁄2 of 1%.  Any change in the ABR due
to a change in the Prime Rate or the Federal Funds Effective Rate shall be
effective as of the opening of business on the effective day of such change in
the Prime Rate or the Federal Funds Effective Rate, respectively.

 

“ABR Loans”: 
Loans the rate of interest applicable to which is based upon the ABR.

 

“Acquisition”:  as defined in Section 4.1(b)(i).

 

“Acquisition Agreement”: the Contribution
Agreement dated as of May 14, 2007 among the Investor, DaimlerChrysler
North America Finance Corporation, DaimlerChrysler Holding Corporation and
Daimler Chrysler AG.

 

“Acquisition Documentation”:  collectively, the Acquisition Agreement and
all schedules, exhibits and annexes thereto and all side letters and agreements
affecting the terms thereof or entered into in connection therewith (including,
without limitation, agreements documenting any transition service
arrangements).

 

“Acquisition True-Up Obligations”:  the obligation, if any, of the Company and
its Subsidiaries to make payments to the DC Contributors (i) in accordance
with Section 2.07(b) of the Acquisition Agreement, in the event that
the Estimated Headquarters Reimbursement Amount (as defined in the Acquisition
Agreement) exceeds the final Headquarters Reimbursement Amount (as defined in
the Acquisition Agreement), in an amount equal to such excess, and (ii) in
accordance with Section 6.07(c) of the Acquisition Agreement, to the
event that the Estimated Company Equity Award Holder Payments (as defined in
the Acquisition Agreement) exceed final aggregate amount of the Company Equity
Award Holder Payments (as defined in the Acquisition Agreement), in an amount
equal to such excess.

 

“Addendum”: an Addendum Agreement,
substantially in the form of Exhibit K.

 

“Additional Subsidiary Guarantor”:  each Domestic Subsidiary (including, subject
to Section 5.7(c), each JV Subsidiary) of the Company (other than any
Excluded Subsidiary) that has Consolidated Total Assets with a Net Book Value
in excess of $250,000,000.

 

“Administrative Agent”:  JPMorgan Chase Bank, N.A., as the
administrative agent for the Lenders under this Agreement and the other Loan
Documents, together with any of its successors in such capacity.

 

 

“Affiliate”: 
as to any Person, any other Person that, directly or indirectly, is in
control of, is controlled by, or is under common control with, such
Person.  For the avoidance of doubt, if
the Acquisition is consummated in accordance with the Acquisition Agreement, on
the Closing Date, neither the DC Contributors nor DaimlerChrysler AG (or their
respective Subsidiaries) shall be Affiliates of any Group Member for the
purposes of any transactions contemplated by the Acquisition Documentation.

 

“Agents”: 
the collective reference to the Collateral Trustee and the
Administrative Agent.

 

“Aggregate Exposure”:  with respect to any Lender at any time, an
amount equal to (i) until the Draw Date, the aggregate amount of such
Lender’s Commitments at such time and (ii) thereafter, the aggregate then
unpaid principal amount of such Lender’s Term Loans.

 

“Aggregate Exposure Percentage”:  with respect to any Lender at any time, the
ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such
time to the Aggregate Exposure of all Lenders at such time.

 

“Agreement”: 
as defined in the preamble hereto.

 

“Applicable Lending Office”:  for any Lender, with respect to the Company,
such Lender’s office, branch or affiliate designated for Eurodollar Loans or
ABR Loans, as applicable, as notified to the Administrative Agent and the
Company or as otherwise specified in the Assignment and Assumption pursuant to
which such Lender became a party hereto, any of which offices may, subject to Section 2.13,
be changed by such Lender upon 10 days’ prior written notice to the
Administrative Agent and the Company.

 

“Applicable Margin”:  (a) 6.00% per annum in the case of ABR
Loans and (b) 7.00% per annum in the case of Eurodollar Loans.

 

“Applicable Premium”:  as of any date upon which a prepayment (as to
which a premium is payable) is payable, the present value at such date,
computed using a discount rate equal to the Treasury Rate plus 50 basis
points, of (a) the prepayment premium applicable to the Term Loans of the
applicable Term Lenders on the first day after the first anniversary of the
Closing Date, plus (b) all interest that would accrue on such Term
Loans from such date to the first day after the first anniversary of the
Closing Date, computed using the Eurodollar Rate for an Interest Period of
three months plus the Applicable Margin for the Term Loans on such date.

 

“Approved Fund”:  as defined in Section 9.6(b).

 

“Asset Sale”: 
any Disposition of property or series of related Dispositions of
property (excluding any Disposition permitted by clause (a), (b), (d), (e),
(f), (g), (h), (i), (j), (k), (l), (n), (o) or (p) of Section 6.5)
that yields gross proceeds to any Group Member (valued at the initial principal
amount thereof in the case of non-cash proceeds consisting of notes or other
debt securities and valued at fair market value in the case of other non-cash
proceeds) in excess of $15,000,000.  The
term “Asset Sale” shall not include any issuance of Capital Stock or any event
that constitutes a Recovery Event.

 

“Asset Sale Collateral Account”:  an account of the Company for which the
Administrative Agent is the depository bank or securities intermediary, as
appropriate, and in respect of which the Company may deposit cash and Cash
Equivalents and over which the Collateral Trustee has “control” (as defined in
the UCC) pursuant to an account control agreement reasonably satisfactory in
form and substance to the Administrative Agent.

 

2

 

“Assignee”: 
as defined in Section 9.6(b).

 

“Assignment and Assumption”:  an Assignment and Assumption, substantially
in the form of Exhibit J.

 

“Attributable Obligations”: in respect of a
Sale/Leaseback Transaction means, as at the time of determination, the present
value (discounted at the interest rate implicit in the transaction) of the
total obligations of the lessee for rental payments required to be paid during
the remaining term of the lease included in such Sale/Leaseback Transaction
(including any period for which such lease has been extended), determined in
accordance with GAAP; provided, however, that if such Sale/Leaseback
Transaction results in a Capital Lease Obligation, the amount of Indebtedness
represented thereby shall be determined in accordance with the definition of “Capital
Lease Obligations”.

 

“Auburn Hills Property”:  the real property described on Schedule 1.1G,
which is the Company’s chief executive office.

 

“Available Liquidity”:  as of any date of determination, the sum of
cash, Cash Equivalents and Temporary Cash Investments held by the Company or
any Subsidiary (which shall include cash, Cash Equivalents or Temporary Cash
Investments of the Company or any of its Subsidiaries deposited with a trustee
of any VEBA which the Company or relevant Subsidiary may access on an
unrestricted basis and any cash or Cash Equivalents in the Borrowing Base
Collateral Account) excluding any Restricted Cash, each as of such date.

 

“Benefitted Lender”:  as defined in Section 9.7(a).

 

“Board”: 
the Board of Governors of the Federal Reserve System of the United
States (or any successor).

 

“Borrowing Base”:  as of any date of determination, the
aggregate of the Borrowing Base Amounts calculated for each category of
Eligible Collateral in accordance with Schedule 1.1B, as the same may be
amended from time to time.  The Borrowing
Base at any time shall be determined by reference to the most recent Borrowing
Base Certificate delivered to Administrative Agent on the Closing Date or
pursuant to Section 5.2, as applicable, (adjusted (a) on a pro
forma basis for (i) any Disposition, and the application of the
proceeds thereof, described in clause (m) of Section 6.5, and (ii) any
addition to the Borrowing Base of additional Collateral in accordance with
Schedule 1.1B or pursuant to Section 5.7, in each case as if consummated
after the last day of the fiscal period covered by such Borrowing Base
Certificate and (b) to exclude the effect of purchase accounting).

 

“Borrowing Base Certificate”:  a certificate substantially in the form of Exhibit F.

 

“Borrowing Base Collateral Account”:  an account of the Company for which the
Administrative Agent is the depository bank or securities intermediary, as
appropriate, and in respect of which the Company may deposit cash and Cash
Equivalents and over which the Collateral Trustee has “control” (as defined in
the UCC) pursuant to an account control agreement reasonably satisfactory in
form and substance to the Administrative Agent.

 

“Borrowing Base Coverage Ratio”:  at any time the ratio of (a) the sum of (i) the
Borrowing Base at such time (adjusted on a pro  forma basis to the
extent, and in the manner, required by this Agreement) and (ii) for the
purposes of Section 6.5(m) only, the amount of cash and Cash
Equivalents in the Asset Sale Collateral Account at such time, to (b) the
Outstanding Amount of Covered

 

3

 

Debt at such time (giving effect to any application
of proceeds to the extent required or permitted by this Agreement).

 

“Borrowing Date”:  any Business Day specified by the Company as
a date on which the Company requests the relevant Lenders to make Loans
hereunder.

 

“Business Day”:  any day other than a Saturday, Sunday or
other day on which banks in New York City are permitted to close; provided,
however, that when used in connection with a Eurodollar Loan, the term “Business
Day” shall also exclude any day on which banks are not open for dealings in
Dollar deposits in the London Interbank market.

 

“Capital Lease Obligations”:  as to any Person, 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, for the
purposes of this Agreement, the amount of such obligations at any time shall be
the capitalized amount thereof at such time determined in accordance with GAAP.

 

“Capital Stock”:  any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation,
any and all equivalent ownership interests in a Person (other than a
corporation) and any and all warrants, rights or options to purchase any of the
foregoing.

 

“Cash Equivalents”: as defined in Schedule
1.1B.

 

“CFC”: as defined in Section 5.7(j).

 

“Change in Tax Law”:  as defined in Section 2.13.

 

“Change of Control”:  the occurrence of any of the following
events:  (a) prior to an Initial
Public Offering, the Sponsor shall fail to own, free and clear of all Liens or
other encumbrances, directly or indirectly, in the aggregate Capital Stock
representing at least 50.1% of the aggregate issued and outstanding Voting
Stock of Holdings on a fully diluted basis or (b) after an Initial Public
Offering any “person” or “group” (within the meaning of Rule 13d-5 of the
Exchange Act), other than the Sponsor, shall control, directly or indirectly,
in the aggregate Voting Stock representing a greater percentage of the
aggregate issued and outstanding Voting Stock of Holdings than the percentage
of Voting Stock owned at such time by the Sponsor and the Sponsor shall fail to
own directly or indirectly in the aggregate Voting Stock representing at least
35% of the aggregate issued and outstanding Voting Stock of Holdings or (c) the
board of directors of Holdings shall cease to consist of a majority of
Continuing Directors or (d)  Holdings shall cease to own 100% of the
outstanding Capital Stock of the Company. 
For the purposes of this definition, it is agreed that the Sponsor will
be deemed to control all of the Voting Stock of an entity owned by another
entity if the Sponsor controls such other entity.

 

“Charitable Subsidiaries”:  each of DaimlerChrysler Corporation Fund
(doing business as “The Chrysler Foundation”), HP DEVCO, INC, Fundacion
DaimlerChrysler de Mexico IAP and Chrysler Institute of Engineering, in each
case so long as such entity carries on its operations as a not for profit or
charitable organization and does not operate or control any business for
profit.

 

“Closing Date”:  the date on which the conditions precedent
set forth in Section 4.1 shall have been satisfied, which date is August 3,
2007.

 

4

 

“Code”: 
the Internal Revenue Code of 1986, as amended from time to time.

 

“Collateral”: 
all property of the Loan Parties, now owned or hereafter acquired (other
than (i) any property or assets to be transferred to DaimlerChrysler AG or
any Affiliate thereof in accordance with Section 6.5(n), (ii) the
Capital Stock of any Charitable Subsidiaries, (iii) the proceeds of any
tax refund received by the Company and payable to DaimlerChrysler AG or any of
its Affiliates pursuant to the terms of Section 7.02(b) of the
Acquisition Agreement, (iv) any cash, Cash Equivalents or Temporary Cash
Investments in an aggregate amount not to exceed $2,000,000,000 maintained in a
segregated deposit or securities account, to the extent such cash, Cash
Equivalents and Temporary Cash Investments have been pledged to FinCo to secure
obligations of the Company under the Master Agreement (other than, for the
avoidance of doubt, any reversionary rights of a Loan Party thereto), and (v) any
cash, Cash Equivalents or Temporary Cash Investments in an aggregate amount not
to exceed $600,000,000 maintained in one or more segregated deposit or securities
accounts, to the extent such cash, Cash Equivalents and Temporary Cash
Investments have been pledged to the DC Contributors or DaimlerChrysler North
America Holdings Corporation to secure obligations of the Company or its
Subsidiaries under the DC Credit Support Agreement (other than, for the
avoidance of doubt, any reversionary rights of a Loan Party thereto)) in which
a Loan Party has granted a Lien pursuant to any Loan Document.

 

“Collateral Trust Agreement”:  the Collateral Trust Agreement to be executed
and delivered by the Company, each Subsidiary Guarantor, the Collateral Trustee
and the other parties named therein, substantially in the form of Exhibit B.

 

“Collateral Trustee”:  Wilmington Trust Company in its capacity as
collateral agent under the Collateral Trust Agreement, and any successor
thereof under the Collateral Trust Agreement and, as the context may require,
any co-agent appointed pursuant to the terms of the Collateral Trust Agreement.

 

“Commitment”: 
as to any Lender, the sum of the Term Commitment of such Lender.

 

“Commitment Fee Rate”: 0.50% per annum.

 

“Commitment Termination Date”: August 3,
2008.

 

“Commonly Controlled Entity”:  an entity, whether or not incorporated, that
is part of a group that includes the Company and that is treated as a single
employer under Section 414(b) or (c) of the Code.

 

“Company Car Financing Program”:  all rights and obligations of the Company and
its Subsidiaries under the financing program provided by FinCo and any of its
Subsidiaries to the Company and any of its Subsidiaries relating to the
financing of company car vehicles pursuant to that certain First Amendment and
Restated Line of Credit Loan Agreement, dated as of December 20, 1996,
between Chrysler Corporation and Chrysler Financial Corporation.

 

“Company Material Adverse Effect”:  with respect to Chrysler Holding LLC and its
Subsidiaries, one or more circumstances, changes, effects, events or
developments, or series of any of the foregoing, that, individually or in the
aggregate, are or are reasonably likely to be materially adverse to the
business, properties, assets, consolidated results of operations or
consolidated financial condition of Chrysler Holding LLC and the Company
Subsidiaries (as defined in the Acquisition Agreement), taken as a whole (provided,
however, that the term “Company Material Adverse Effect” shall
not include any changes, circumstances or effects that result from or are
consequences of:  (a) events,
circumstances, changes or effects that generally affect the industry in which
Chrysler Holding LLC and the Company 

 

5

 

Subsidiaries operate, (b) general economic
conditions or events, circumstances, changes or effects affecting the
securities markets generally, (c) discussions or negotiations (or the
absence thereof) with unions, strikes, slowdowns or work stoppages, (d) changes
in laws, rules or regulations of any Governmental Authority, or changes in
regulatory conditions in the countries in which Chrysler Holding LLC or any
Company Subsidiaries operate not having a materially disproportionate adverse
effect on Chrysler Holding LLC and the Company Subsidiaries as compared to
their competitors, (e) changes in prevailing interest rates or foreign
exchange rates, (f) changes in accounting standards, principles or
interpretations, (g) changes arising from the consummation of the
transactions contemplated by, or the announcement of the execution of, the
Acquisition Agreement, including (i) any actions of competitors, (ii) any
losses of employees, or (iii) any delays or cancellations of orders for
products or services, (h) any reasonably proportionate reduction in the
price of services or products offered by Chrysler Holding LLC and the Company
Subsidiaries in response to the reduction in price of comparable services or
products offered by a significant competitor, (i) any circumstance, change
or effect that results from any action required or contemplated to be taken
pursuant to or in accordance with the Acquisition Agreement or any action taken
at the written request of the Investor, and (j) changes caused by a
material worsening of current conditions caused by acts of terrorism or war
(whether or not declared) occurring after the date hereof not having a
materially disproportionate adverse effect on Chrysler Holding LLC and the
Company Subsidiaries as compared to their competitors).

 

“Compliance Certificate”:  a certificate duly executed by a Responsible
Officer, substantially in the form of Exhibit L.

 

“Conduit Lender”:  any special purpose corporation organized and
administered by any Lender for the purpose of making Loans otherwise required
to be made by such Lender and designated by such Lender in a written
instrument; provided, that the designation by any Lender of a Conduit Lender
shall not relieve the designating Lender of any of its obligations to fund a
Loan under this Agreement if, for any reason, its Conduit Lender fails to fund
any such Loan, and the designating Lender (and not the Conduit Lender) shall
have the sole right and responsibility to deliver all consents and waivers
required or requested under this Agreement with respect to its Conduit Lender,
and provided, further, that no Conduit Lender shall (a) be
entitled to a claim to receive any greater amount pursuant to Section 2.12,
2.13, 2.14 or 9.5, unless the designating Lender shall have been entitled to
such claim and, then, solely in an amount not exceeding the amount the
designating Lender would have been entitled to receive in respect of the
extensions of credit made by such Conduit Lender or (b) be deemed to have
any Commitment.

 

“Confidential Information Memorandum”: the
confidential information memorandum dated June 27, 2007 and furnished to
certain Lenders.

 

“Consolidated Leverage Ratio”:  as at the last day of any period, the ratio
of (a) Consolidated Total Debt, less the sum of cash, Cash Equivalents or
Temporary Cash Investments held by the Company and its Subsidiaries, excluding
Restricted Cash, on such day to (b) EBITDA for such period.

 

“Consolidated Total Assets”:  at any date, with respect to any Person, the
amount set forth opposite the caption “total assets” (or any like caption) on
the consolidated balance sheet (or the equivalent) of such Person and its
consolidated Subsidiaries most recently delivered on or prior to the Closing
Date and described in Section 3.1 or pursuant to Section 5.1.

 

“Consolidated Total Debt”:  at any date, the aggregate principal amount
of all Indebtedness (excluding all Indebtedness of the Company and its
Subsidiaries that may be outstanding under the Gold Key Lease Program to the
extent that the Company or any of its Subsidiaries is the beneficiary of credit
support obligations provided by FinCo or its Subsidiaries in an amount at least
equal 

 

6

 

to such Indebtedness) of the Company and its
Subsidiaries that would be reflected on the consolidated balance sheet of the
Company and its Subsidiaries as of such date in accordance with GAAP.

 

“Continuing Directors”:  with respect to any Person, the directors (or
the equivalent) of such Person on the Closing Date, after giving effect to the
transactions contemplated hereby, and each other director of such Person, if
such other director’s nomination for election to the board of directors (or the
equivalent) of such Person is recommended by a majority of the then applicable
Continuing Directors or such other director receives the vote of the Sponsor in
his or her election by the shareholders of such Person.

 

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

 

“control”: 
(including the terms “controlled by” and “under common control
with”):  with respect to the
relationship between or among two or more Persons, means the possession,
directly or indirectly, of the power to direct or cause the direction of the
affairs or management of a Person, whether through the ownership of voting
securities, as trustee, personal representative or executor, by contract or
otherwise.

 

“Control Investment Affiliate”:  as to any Person, any other Person that (a) directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person and (b) is organized by such Person primarily for the
purpose of making equity or debt investments in one or more companies.

 

“Conversion Vehicle Wholesale Financing Program”:  a financing program provided by FinCo or its
Subsidiaries pursuant to which (i) FinCo or its Subsidiaries provides
wholesale financing to recreational truck and van conversion companies and
manufacturers of specialized bodies and equipment on vehicles which are
consignees of the Company (the “Converters”) to enable such Persons to
hold on consignment from the Company or any of its Subsidiaries vehicles,
chassis, other merchandise and inventory (the “Merchandise”)
manufactured by the Company and its Subsidiaries for the sole purpose of
storing, upfitting or adding to the Merchandise, which financings are secured
by such Merchandise and repaid with the proceeds of the sale of such
Merchandise by the Company, (ii) the Company is obligated to pay (on
behalf of the Converters) to FinCo or its Subsidiaries a portion of the first
90 days of interest accruing on such loans and (iii) the Company is
obligated to purchase the Merchandise from the Converters upon completion of
the conversion.

 

“Copyright Security Agreement”:  the Copyright Security Agreement to be executed
and delivered by the Company and the Collateral Trustee, substantially in the
form of Exhibit D.

 

“Covered Debt”:  collectively, (a) all Indebtedness
incurred under the First Lien Credit Agreement, (b) any Permitted First
Lien Non-Loan Exposure (as defined in the First Lien Credit Agreement), (c) all
Indebtedness incurred under this Agreement and (d) any Permitted Second
Lien Non-Loan Exposure.

 

“Cumulative Excess Cash Flow Amount”:  as of any date of determination, an amount,
not less than zero, equal to 50% of the sum of the following determined on a
consolidated basis, without duplication, for the Company and its Subsidiaries
in accordance with GAAP: (a) EBITDA for such period minus (b) the sum
of the following: (i) cash taxes based on income and profits for such
period, (ii) cash Interest Expense (net of interest income) for such
period, (iii) all scheduled principal payments made in respect of
Indebtedness which results in a permanent repayment of such Indebtedness during
such period,

 

7

 

(iv) all capital expenditures (made in cash)
during such period other than expenditures made with proceeds of a purchase
money financing or capital lease financing or from Dispositions or Recovery
Events (without giving effect to the threshold contained in such definition),
and (v) the aggregate amount of Restricted Payments made pursuant to Section 6.6
(other than clauses (a), (b), (e), (g), (i) or (j)) prior to such date, in
each case, as reported in the Company’s most recently delivered financial
statements delivered pursuant to Section 5.1(b), commencing with the
fiscal quarter ended September 30, 2007 to the most recently ended fiscal
quarter of the Company for which financial statements have been delivered
pursuant to Section 5.1(b) prior to such date (taken as one
accounting period).

 

“DC Contributors”:  DaimlerChrysler North America Finance
Corporation, a Delaware corporation, and DaimlerChrysler Holding Corporation, a
Delaware corporation.

 

“DC Credit Support Agreement”: the Agreement
(Collateral for Continuing Credit Support Instruments), dated as of August 3,
2007, between the Company, DC Contributors, DaimlerChrysler North America
Holdings Corporation and the Investor.

 

“De Minimis Subsidiary”:  any Subsidiary of the Company that is not a
Subsidiary Guarantor that has Consolidated Total Assets with a Net Book Value
of less than $100,000,000.

 

“Default”: 
any of the events specified in Section 7, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.

 

“Designated Cash Management Obligations”:  obligations of the Company or any Subsidiary
to banks, financial institutions, investment banks and others in respect of
banking, cash management (including, without limitation, Automated
Clearinghouse transactions), custody and other similar services and company
paid credit cards that permit employees to make purchases on behalf of the
Company or such Subsidiary designated by the Company in accordance with the
Collateral Trust Agreement from time to time as constituting “Designated Cash
Management Obligations.”

 

“Designated Hedging Obligations”:  the direct obligations of the Company or any
of its Subsidiaries, and the obligations of the Company as a guarantor of any
Subsidiary’s obligations, to counterparties designated by the Company in
accordance with the Collateral Trust Agreement from time to time as
constituting “Designated Hedging Obligations” under or in connection with any
of the following: (a) a rate swap transaction, swap option, basis swap,
forward rate transaction, commodity swap, commodity option, equity or equity
index swap, equity or equity index option, bond option, interest rate option,
foreign exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross currency rate swap transaction, currency
option, credit protection transaction, credit swap, credit default swap, credit
default option, total return swap, credit spread transaction, repurchase
transaction, reverse repurchase transaction, buy/sell-back transaction,
securities lending transaction, weather index transaction or forward purchase
or sale of a security, commodity or other financial instrument or interest
(including any option with respect to any of these transactions) or (b) which
is a type of transaction that is similar to any transaction referred to in
clause (a) above that is currently, or in the future becomes, recurrently
entered into in the financial markets (including terms and conditions incorporated
by reference in such agreement) and which is a forward, swap, future, option or
other derivative on one or more rates, currencies, commodities, equity
securities or other equity instruments, debt securities or other debt
instruments, economic indices or measures of economic risk or value, or other
benchmarks against which payments or deliveries are to be made.

 

“Disposition”:  with respect to any property, any sale,
transfer or other disposition thereof (and shall include the issuance of
Capital Stock) (other than the incurrence or grant of any Lien or the 

 

8

 

occurrence of any Recovery Event); and the terms “Dispose”
and “Disposed of” shall have correlative meanings.

 

“Dollar Equivalent”:  on any date of determination, (a) with
respect to any amount denominated in Dollars, such amount and (b) with
respect to an amount denominated in any other currency, the equivalent in
Dollars of such amount determined by the Administrative Agent in accordance
with normal banking industry practice using the Exchange Rate on the date of
determination of such equivalent.  In
making any determination of the Dollar Equivalent, the Administrative Agent
shall use the relevant Exchange Rate in effect on the date on which a Dollar
Equivalent is required to be determined pursuant to the provisions of this
Agreement.  As appropriate, amounts
specified herein as amounts in Dollars shall be or include any relevant Dollar
Equivalent amount.

 

“Dollars” and “$”:  the lawful money of the United States.

 

“Domestic Subsidiary”:  any Subsidiary of the Company organized under
the laws of the United States, any state thereof or the District of Columbia
but excluding Puerto Rico or any external United States territory.

 

“Draw Date”: as defined in Section 2.1.

 

“EBITDA”: 
for any period, Net Income plus, to the extent deducted in
determining Net Income, the sum of:  (a) Interest
Expense, amortization or write-off of debt discount, other deferred financing
costs and other fees and charges associated with Indebtedness, plus (b) expense
for taxes paid or accrued, plus (c) depreciation, plus (d) amortization,
write-offs, write-downs, asset revaluations and other non-cash charges, losses
and expenses, plus (e) impairment of intangibles, including, without
limitation, goodwill, plus (f) extraordinary expenses or losses (as
determined in accordance with GAAP) including, without limitation, an amount
equal to any extraordinary loss plus any net loss realized by the
Company or any of its Subsidiaries in connection with  any disposition or the extinguishment of
Indebtedness, plus (g) fees paid pursuant to the management
agreement referenced in Section 6.11 as in effect on the date hereof and
out-of-pocket expenses in connection with the performance of management,
consulting, monitoring, financial advisory or other services, plus (h) fees
and expenses incurred in connection with the Acquisition and Investments
permitted under Section 6.10, plus (i) transaction costs
incurred in connection with the Acquisition, plus (j) transaction
costs incurred in connection with an Initial Public Offering, plus (k) all
OPEB costs, expenses and charges other than service costs, plus (l) losses
(but minus gains) due solely to fluctuations in currency values and the related
tax effects in accordance with GAAP, plus (m) loss attributable to
discontinued operations, plus (n) losses (but minus gains)
attributable to the cumulative effect of a change in accounting principles, plus
(o) non-recurring costs, charges and expenses during such period, (p) plus
the amount, if positive, of the sum of non cash expenses for minority
interests, less dividends paid to minority parties, minus (q) to
the extent included in Net Income, extraordinary gains (as determined in
accordance with GAAP), together with any related provision for taxes on such
extraordinary gain, all calculated without duplication for the Company and its
Subsidiaries on a consolidated basis for such period.  For purposes of this Agreement, EBITDA shall
be adjusted on a pro forma basis to include, as of the first day of any
applicable period, the Acquisition, any other acquisition and any disposition
consummated during such period, including, without limitation, adjustments
reflecting any non-recurring costs and any extraordinary expenses of the
Acquisition, any other acquisition and any disposition consummated during such
period and any Pro forma Cost Savings attributable thereto, each calculated on
a basis consistent with GAAP or as otherwise reasonably approved by the
Administrative Agent (which approval shall not be unreasonably withheld).  For the purposes of this Agreement, EBITDA (i) for
the fiscal quarter ending December 31, 2006 shall be $701,000,000, (ii) for
the fiscal quarter ending March 31, 2007 shall be $522,000,000, and (iii) for
the fiscal quarter ending June 30, 2007 shall be $802,000,000.

 

9

 

“Environmental Laws”:  any and all foreign, Federal, state,
provincial, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority or other
Requirements of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health, the
environment or natural resources, as now or may at any time hereafter be in
effect.

 

“ERISA”: 
the Employee Retirement Income Security Act of 1974, as amended from
time to time.

 

“Eurocurrency Reserve Requirements”:  for any day as applied to a Eurodollar Loan,
the aggregate (without duplication) of the maximum rates (expressed as a
decimal fraction) of reserve requirements in effect on such day (including
basic, supplemental, marginal and emergency reserves) under any regulations of
the Board or other Governmental Authority having jurisdiction with respect
thereto dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D of the
Board) maintained by a member bank of the Federal Reserve System.

 

“Eurodollar Base Rate”:  with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on the
basis of the rate for deposits in Dollars for a period equal to such Interest
Period commencing on the first day of such Interest Period appearing on page LIBOR01
of the Reuters screen as of 11:00 A.M., London time, two Business Days
prior to the beginning of such Interest Period. 
In the event that such rate does not appear on such page of the
Reuters screen (or otherwise on such screen), the “Eurodollar Base Rate”
shall be determined by reference to such other comparable publicly available
service for displaying eurodollar rates as may be selected by the
Administrative Agent with the consent of the Company (such consent not to be
unreasonably withheld) or, in the absence of such availability, by reference to
the rate at which the Administrative Agent is offered Dollar deposits at or
about 11:00 A.M., New York City time, two Business Days prior to the
beginning of such Interest Period in the interbank eurodollar market where its
eurodollar and foreign currency and exchange operations are then being
conducted for delivery on the first day of such Interest Period for the number
of days comprised therein.

 

“Eurodollar Loans”:  Loans the rate of interest applicable to
which is based upon the Eurodollar Rate.

 

“Eurodollar Rate”:  with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for such
day in accordance with the following formula (rounded upward to the nearest
1/100th of 1%):

 

	
   

  	
  Eurodollar Base Rate

  	
   

  
	
  1.00 - Eurocurrency Reserve Requirements

  

 

“Eurodollar Tranche”:  the collective reference to Eurodollar Loans
the then current Interest Periods with respect to all of which begin on the
same date and end on the same later date (whether or not such Loans shall
originally have been made on the same day).

 

“Event of Default”:  any of the events specified in Section 7,
provided that any requirement for the giving of notice, the lapse of
time, or both, has been satisfied.

 

“Exchange Act”:  the Securities and Exchange Act of 1934, as
amended.

 

10

 

“Exchange Rate”:  for any day with respect to any currency
(other than Dollars), the rate at which such currency may be exchanged into
Dollars, as set forth at 11:00 A.M., New York time, on such day on the
applicable Bloomberg currency page with respect to such currency.  In the event that such rate does not appear
on the applicable Bloomberg currency page, the Exchange Rate with respect to
such currency shall be determined by reference to such other publicly available
service for displaying exchange rates as may be agreed upon by the
Administrative Agent and the Company or, in the absence of such agreement, such
Exchange Rate shall instead be the spot rate of exchange of the Administrative
Agent in the London Interbank market or other market where its foreign currency
exchange operations in respect of such currency are then being conducted, at or
about 11:00 A.M., New York time, on such day for the purchase of Dollars
with such currency, for delivery two Business Days later; provided, however,
that if at the time of any such determination, for any reason, no such spot
rate is being quoted, the Administrative Agent may use any reasonable method it
deems appropriate to determine such rate, and such determination shall be
conclusive absent manifest error.

 

“Excluded Subsidiary”:  any Domestic Subsidiary that is a direct or
indirect Subsidiary of a Foreign Subsidiary.

 

“Facility”: 
each of the Term Commitments and the Term Loans made thereunder
(alternatively, the “Term Facility”).

 

“Federal Funds Effective Rate”:  for any day, the weighted average of the
rates on overnight federal funds transactions with members of the Federal
Reserve System 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 of such transactions received by JPMorgan Chase
Bank, N.A. from three federal funds brokers of recognized standing selected by
it.

 

“Fee Payment Date”:  (a) the third Business
Day following the last day of each March, June, September and December,
and (b) the earlier to occur of the Draw Date or the Commitment
Termination Date.

 

“Fee Payment Period”:  initially the period from and including the
Closing Date to but excluding the initial Fee Payment Date, and thereafter each period commencing on and
including a Fee Payment Date to but excluding the succeeding Fee Payment Date.

 

“Fenton IRB Transactions”:  all of the rights and obligations of the
Company pursuant to the terms of:  (i) the
Trust Indenture, dated as of December 1, 2004, by and between the City of
Fenton, Missouri and The Bank of New York Trust Company N.A., in an aggregate
maximum principal amount of $112,000,000; (ii) the Lease Agreement, dated
as of December 1, 2004, by and between the City of Fenton, Missouri, as
lessor and DaimlerChrysler Corporation, as lessee; (iii) the Performance
Agreement, dated as of December 1, 2004, by and between the City of
Fenton, Missouri and DaimlerChrysler Corporation; (iv) the Bond Purchase
Agreement, dated as of December 1, 2004, by and between the City of
Fenton, Missouri and DaimlerChrysler Corporation, as purchaser; (v) the
Trust Indenture, dated as of November 1, 2005, by and between the City of
Fenton, Missouri and The Bank of New York Trust Company N.A., in an aggregate
maximum principal amount of $1,000,000,000; (vi) the Lease Agreement,
dated as of November 1, 2005, by and between the City of Fenton, Missouri,
as lessor and DaimlerChrysler Corporation, as lessee; (vii) the
Performance Agreement, dated as of November 1, 2005, by and between the
City of Fenton, Missouri and DaimlerChrysler Corporation; (viii) the Bond
Purchase Agreement, dated as of November 1, 2005, by and between the City
of Fenton, Missouri and DaimlerChrysler Corporation, as purchaser; and, in each
case, and (ix) any other indentures, leases, performance agreements, and
bond purchase agreements into which the Company and the City of Fenton, 

 

11

 

Missouri may enter pursuant to the same or similar
enabling resolutions and on substantially similar terms.

 

“FinCo”: DaimlerChrysler Financial Services
Americas LLC, a Michigan limited liability company and its successors.

 

“FinCo Facilities”: collectively the (i) Credit
Agreement, dated as of the Closing Date, among FinCo as borrower, the
Administrative Agent as administrative agent thereunder, Citibank N.A. and
Goldman Sachs Credit Partners, L.P. as syndication agents and the banks and
financial institutions party thereto from time to time as lenders, and (ii) Second
Lien Term Loan Agreement, dated as of the Closing Date, among FinCo as
borrower, the Administrative Agent as administrative agent thereunder, Citibank
N.A. and Goldman Sachs Credit Partners, L.P. as syndication agents and the
banks and financial institutions party thereto from time to time as lenders.

 

“First Lien Credit Agreement”: the First Lien
Credit Agreement, dated as of the Closing Date among the Company as the
borrower, the Administrative Agent as administrative agent thereunder, Goldman
Sachs Credit Partners, L.P. and Citibank N.A. as syndication agents and the
lenders party thereto from time to time as lenders, as the same may from time
to time be amended modified or otherwise supplemented.

 

“Foreign Benefit Arrangement”:  any employee benefit arrangement mandated by
non-US law.

 

“Foreign Plan”:  each employee benefit plan (within the
meaning of Section 3(3) of ERISA, whether or not subject to ERISA)
maintained or contributed to by the Company or any Commonly Controlled Entity
that is not subject to US law.

 

“Foreign Subsidiary”:  any Subsidiary of the Company that is not a
Domestic Subsidiary.

 

“Funding Office”:  the office of the Administrative Agent
specified in Section 9.2 or such other office as may be specified from
time to time by the Administrative Agent as its funding office with respect to
any Facility or Facilities by written notice to the Company and the Lenders.

 

“GAAP”: 
generally accepted accounting principles in the United States as in
effect from time to time.  In the event
that any “Accounting Change” (as defined below) shall occur and such change
results in a change in the method of calculation of covenants, the Borrowing
Base, standards or terms in this Agreement, then the Company and the
Administrative Agent agree to enter into negotiations in order to amend such
provisions of this Agreement so as to reflect equitably such Accounting Changes
with the desired result that the criteria for evaluating the Company’s
financial condition and the Borrowing Base shall be the same after such
Accounting Changes as if such Accounting Changes had not been made.  Until such time as such an amendment shall
have been executed and delivered by the Company, the Administrative Agent and
the Required Lenders, all covenants, the Borrowing Base, standards and terms in
this Agreement shall continue to be calculated or construed as if such
Accounting Changes had not occurred.  “Accounting
Changes” refers to changes in accounting principles required by the
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants or, if applicable, the SEC.

 

“Gelco Lease Program”:  a Sale/Leaseback Transaction pursuant to
which the Company and its Subsidiaries manufacture and sell vehicles to Gelco
Corporation (doing business as GE Capital Fleet Services (“GE Capital”)),
which vehicles are then leased to the Company pursuant to the terms of a lease
for use by the Company in its company car program in the ordinary course of
business, as more 

 

12

 

fully described in and pursuant to the terms of that
certain Master Lease Agreement, dated October 31, 2001, by and between GE
Capital and DaimlerChrysler Corporation, together with all related schedules
thereto and servicing and agency agreements or any other program with a
different financial institution on substantially similar terms.

 

“Gold Key Lease Program”:  the program pursuant to which (i) DaimlerChrysler
Financial Services Canada Inc. (the successor to Chrysler Credit Canada Ltd.) (“CCC”)
purchases, as agent and bare trustee, vehicles manufactured or distributed by
DaimlerChrysler Canada Inc. (formerly known as Chrysler Canada Ltd.) (“CCL”)
from dealerships with the proceeds of loans made to it by CCC, and then leased
by CCC, as agent and bare trustee for CCL, to the customers of CCC, the lease
payments (and related vehicles) of which are pledged to CCC and the proceeds
thereof are used to repay any outstanding loans owing by CCL to CCC, as more
fully described in and pursuant to the terms of (x) that certain Gold Key
Administration and Credit Risk Assumption Agreement, dated as of July 1,
1996, by and between CCL and Chrysler Credit Canada Ltd., and (y) that certain
Amended and Restated Loan Agreement dated as of December 31, 2002 between
CCL and CCC and (ii) CCL may in certain cases concurrently lease or sell
its beneficial interests in the lease payment receivables and leased vehicles
described above to various entities which engage in financing such receivables,
including its interest in any collateral securing such receivables, in each
case, together with all schedules and related agreements.

 

“Governmental Authority”:  any federal, state, provincial, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, or any federal, state or municipal court, in each case whether
of the United States or foreign.

 

“Group Members”:  the collective reference to Holdings, the
Company and their respective Subsidiaries but excluding the Charitable
Subsidiaries.

 

“Guarantee”: 
the Guarantee Agreement to be executed and delivered by the Company,
Holdings and each Subsidiary Guarantor, substantially in the form of Exhibit C.

 

“Guarantee Obligation”:  as to any Person (the “guaranteeing person”),
any obligation, including a reimbursement, counterindemnity or similar
obligation, of the guaranteeing Person that guarantees or in effect guarantees,
or which is given to induce the creation of a separate obligation by another
Person (including any bank under any letter of credit) that guarantees or in
effect guarantees, any Indebtedness, leases, dividends or other obligations
(the “primary obligations”) of any other third Person (the “primary
obligor”) in any manner, whether directly or indirectly, including any
obligation of the guaranteeing person, whether or not contingent, (i) to
purchase any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (1) for
the purchase or payment of any such primary obligation or (2) to maintain
working capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency of the primary obligor, (iii) 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 or (iv) otherwise to assure or
hold harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee Obligation
shall not include endorsements of instruments for deposit or collection in the
ordinary course of business.  The amount
of any Guarantee Obligation of any guaranteeing person shall be deemed to be
the lower of (a) an amount equal to the stated or determinable amount of
the primary obligation in respect of which such Guarantee Obligation is made
and (b) the maximum amount for which such guaranteeing person may be
liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which
such guaranteeing person may be liable are not stated or determinable, in which
case the amount of such Guarantee Obligation shall be such guaranteeing person’s
maximum reasonably anticipated liability in respect thereof as determined by
the Company in good faith.

 

13

 

“Holdings”: CarCo Intermediate HoldCo II LLC,
a Delaware limited liability company.

 

“IDCA”: the International Distribution
Cooperation Agreement, dated as of August 3, 2007, between DaimlerChrysler
AG, the Company and Chrysler International Corporation.

 

“Indebtedness”:  of any Person at any date, without
duplication, (a) all indebtedness of such Person for borrowed money, (b) all
obligations of such Person for the deferred purchase price of property or
services (other than current trade payables incurred in the ordinary course of
such Person’s business), (c) all obligations of such Person evidenced by
notes, bonds, debentures or other similar instruments, (d) all
indebtedness created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such property), (e) all
Capital Lease Obligations and Attributable Obligations of such Person, (f) all
obligations of such Person, contingent or otherwise, as an account party or
applicant under or in respect of acceptances, letters of credit, surety bonds
or similar arrangements, (g) all Guarantee Obligations of such Person in
respect of obligations of the kind referred to in clauses (a) through (f) above,
(h) all obligations of the kind referred to in clauses (a) through (g) above
secured by (or for which the holder of such obligation has an existing right,
contingent or otherwise, to be secured by) any Lien on property (including
accounts and contract rights) owned by such Person, whether or not such Person
has assumed or become liable for the payment of such obligation, and (i) for
the purposes of Section 7(d) only, all obligations of such Person in
respect of Swap Agreements.  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 to the extent the
terms of such Indebtedness expressly provide that such Person is not liable
therefor.  For purposes of Section 6.3
and Section 6.4, the Dollar Equivalent amount of Indebtedness denominated
in any currency other than Dollars shall be determined as of the date such
Indebtedness is incurred or any commitment for such Indebtedness is issued and
the Company and its Subsidiaries shall not be deemed to exceed any limit set
forth in Section 6.3 or Section 6.4 solely as a result of subsequent
fluctuations in the exchange rate of currency. 
Indebtedness shall not include vehicle guarantee depreciation programs
of any Group Member.

 

“Indemnified Liabilities”:  as defined in Section 9.5.

 

“Indemnitee”: 
as defined in Section 9.5.

 

“Initial Public Offering”:  any initial public offering by any Person of
Capital Stock of such Person pursuant to which such Person offers to the public
Capital Stock of any Parent Entity pursuant to a registration statement on Form S-1
(or any similar, successor or replacement form) and receives gross proceeds of
$500,000,000 or more.

 

“Initial Subsidiary Guarantor”:  each Domestic Subsidiary listed on Schedule
1.1D.

 

“Insolvency”: 
with respect to any Multiemployer Plan, the condition that such Plan is
insolvent within the meaning of Section 4245 of ERISA.

 

“Insolvent”: 
pertaining to a condition of Insolvency.

 

“Intellectual Property”:  the collective reference to all rights,
priorities and privileges with respect to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including copyrights, copyright licenses, patents, patent licenses, trademarks,
trademark licenses, technology, know-how and processes, and all rights to sue
at law or in equity for any 

 

14

 

infringement or other impairment thereof, including
the right to receive all proceeds and damages therefrom.

 

“Interest Expense”:  for any period, gross interest expense paid
or payable in cash (including amortization of debt issuance costs, the interest
component of any deferred interest payments, the interest component of all
payments associated with Capital Lease Obligations and Attributable
Obligations, imputed interest with respect to all Capital Lease Obligations and
Attributable Obligations, imputed interest with respect to all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers’ acceptance financing and net of the effects of all payments made or
received pursuant to Swap Agreements in respect of interest rates to the extent
such payments are received or made during such period, in each case determined
on a consolidated basis in accordance with GAAP.  For purposes of this Agreement, Interest
Expense shall be adjusted on a pro forma basis to give effect to any
Indebtedness incurred, assumed or permanently repaid or extinguished during the
applicable period in connection with the Acquisition, any other acquisition or
any Disposition as if such incurrence, assumption, repayment or extinguishing
had been effected on the first day of such period.

 

“Interest Payment Date”:  (a) as to any ABR Loan, the first day of
each March, June, September and December to occur while such Loan is
outstanding and the final maturity date of such Loan, (b) as to any
Eurodollar Loan having an Interest Period of three months or less, the last day
of such Interest Period, (c) as to any Eurodollar Loan having an Interest
Period longer than three months, each day that is three months, or a whole
multiple thereof, after the first day of such Interest Period and the last day
of such Interest Period and (d) as to any Loan, the date of any repayment
or prepayment made in respect thereof.

 

“Interest Period”:  as to any Eurodollar Loan, (i) initially,
the period commencing on the borrowing or conversion date, as the case may be,
with respect to such Loan and ending one, two, three or six (or with the
consent of each Lender, nine or twelve) months thereafter, as selected by the
Company in its notice of borrowing or notice of conversion, as the case may be,
given with respect thereto; and (ii) thereafter, each period commencing on
the last day of the next preceding Interest Period applicable to such Loan and
ending one, two, three or six (or with the consent of each Lender, nine or
twelve) months thereafter, as selected by the Company by irrevocable notice to
the Administrative Agent not later than 12:00 Noon, New York City time, on the
date that is three Business Days prior to the last day of the then current
Interest Period with respect thereto; provided that, all of the
foregoing provisions relating to Interest Periods are subject to the following:

 

(A)          if
any Interest Period would otherwise end on a day that is not a Business Day,
such Interest Period shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on the
immediately preceding Business Day;

 

(B)           the
Company may not select an Interest Period that would extend beyond the date
final payment is due on the Term Loans; and

 

(C)           any
Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Business Day of the
calendar month at the end of such Interest Period.

 

“Investments”:  as defined in Section 6.10.

 

“Investor”: 
CG Investor, LLC, a Delaware limited liability company.

 

15

 

“JV Subsidiary”:  any Subsidiary of a Group Member which is not
a Wholly Owned Subsidiary and as to which the business and management thereof
is jointly controlled by the holders of the Capital Stock therein pursuant to
customary joint venture arrangements.

 

“Lenders”: 
as defined in the preamble hereto; provided, that unless the
context otherwise requires, each reference herein to the Lenders shall be
deemed to include any Conduit Lender.

 

“Lien”: 
any mortgage, pledge, hypothecation, assignment for security, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement and any capital lease
having substantially the same economic effect as any of the foregoing).

 

“Liquid Securities”: any securities listed or
quoted on any national securities exchange that has registered with the SEC
pursuant to Section 6(a) of the Exchange Act, the Nasdaq National
Market or any designated offshore securities market as defined in Regulation S
under the Securities Act; provided that such securities (i) are
registered, or may otherwise be sold without restriction under the Securities
Act, (ii) are part of a class of securities that has a public float in
excess of $500 million and (iii) represent less than 5% of the public
float of such class of securities.

 

 “Loan”:  any loan made by any Lender pursuant to this
Agreement.

 

“Loan Documents”:  this Agreement, the Security Documents, the
Guarantee, the Collateral Trust Agreement, the Notes, and any amendment,
waiver, supplement or other modification to any of the foregoing.

 

“Loan Parties”:  the Company, Holdings and each Subsidiary
Guarantor.

 

“Mandatory Prepayment”:  the prepayment in accordance with Section 2.5
of outstanding Term Loans, on a pro  rata basis according to the
Outstanding Amounts thereof at the time of such prepayment.

 

“Master Agreement”:  (i) the Master Autofinance Agreement,
entered into as of August 3, 2007, by and between the Company, as the
manufacturer, and FinCo, (ii) the Shared Transition Services Agreement,
entered into as of August 3, 2007, by and between the Company and FinCo, (iii) the
Intellectual Property License Agreement, entered into as of August 3,
2007, by and between the Company and FinCo, and (iv) any agreement,
instrument, annex, schedule, exhibit or other document related thereto.

 

“Material Adverse Effect”:  a material adverse effect on (a) the
business, operations, property or financial condition of the Company and its
Subsidiaries taken as a whole or (b) the validity and enforceability of
this Agreement or any of the other Loan Documents or the rights and remedies of
the Administrative Agent, the Collateral Trustee and the Lenders hereunder or
thereunder.

 

“Material Unsecured Indebtedness”:  any unsecured Indebtedness of any Loan Party
having an aggregate Outstanding Amount in excess of $300,000,000.

 

“Materials of Environmental Concern”:  any gasoline or petroleum (including crude
oil or any fraction thereof) or petroleum products or any hazardous or toxic
substances, materials or wastes, defined or regulated as such in or under any
Environmental Law, including asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.

 

16

 

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

 

“Mortgaged Property”:  each property listed on Schedule 1.1E, as to
which the Collateral Trustee for the benefit of the Secured Parties shall be
granted a Lien pursuant to the Mortgages.

 

“Mortgages”: 
each of the mortgages and deeds of trust made by the Company or any
Subsidiary Guarantor in favor of, or for the benefit of, the Collateral Trustee
for the benefit of the Secured Parties, substantially in the form of Exhibit E
(with such changes thereto as the Company and the Administrative Agent
reasonably agree are advisable under the law of the jurisdiction in which such
mortgage or deed of trust is to be recorded).

 

“Multiemployer Plan”:  a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.

 

“Net Book Value”:  with respect to any asset of any Person (a) other
than accounts receivable, the gross book value of such asset on the balance
sheet of such Person, minus depreciation or amortization in respect of
such asset on such balance sheet and (b) with respect to accounts
receivable, the gross book value thereof, minus any specific reserves
attributable thereto, each determined in accordance with GAAP.

 

“Net Cash Proceeds”:  (a) in connection with any Asset Sale or
any Recovery Event, the proceeds thereof in the form of cash and Cash
Equivalents (including any such proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received), net of (i) purchase
price adjustments reasonably expected to be payable in connection with such
Asset Sale, (ii) attorneys’ fees, accountants’ fees, investment banking
fees, consultants’ fees, finders’ fees, brokers’ fees, advisory fees and other
customary fees and expenses actually incurred in connection therewith, (iii) amounts
required to be applied to the repayment of Indebtedness secured by a Lien
expressly permitted hereunder on any asset that is the subject of such Asset Sale
or Recovery Event (other than any Lien pursuant to a Security Document), (iv) taxes
paid or reasonably estimated to be payable as a result thereof, and (v) in
the case of an Asset Sale, a reasonable reserve for any payments (fixed or
contingent) attributable to the seller’s indemnities and representations and
warranties to the purchaser or seller’s retained liabilities in respect of such
Asset Sale undertaken in connection with such Asset Sale including pension and
other post-employment benefit liabilities and liabilities related to
environmental matters and liabilities under indemnification obligations
associated with such Asset Sale or (b) in connection with any issuance or
sale of Capital Stock or any incurrence of Indebtedness, the cash proceeds
received from such issuance or incurrence, net of attorneys’ fees, investment
banking fees, accountants’ fees, consultants’ fees, finders’ fees, brokers’
fees, advisory fees, underwriting discounts and commissions and other customary
fees and expenses actually incurred in connection therewith.

 

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

 

“Non-Excluded Taxes”:  as defined in Section 2.13(a).

 

“Non-U.S. Lender”:  as defined in Section 2.13(d).

 

“Non-Recourse Debt”:  Indebtedness of a Person:  (a) as to which no Loan Party provides
any Guarantee Obligation or credit support of any kind or is directly or
indirectly liable (as a guarantor or otherwise); and (b) which does not
provide any recourse against any of the assets of any Loan Party.  Notwithstanding the foregoing, the obligation
to make capital contributions pursuant to the governing 

 

17

 

documents of any JV Subsidiary shall not invalidate
the status of the Indebtedness of such JV Subsidiary classified as Non-Recourse
Indebtedness pursuant to the terms of this definition.

 

“Notes”: 
the collective reference to any promissory note evidencing Loans.

 

“Notice of Event of Default”:  as defined in the Collateral Trust Agreement.

 

“Obligations”:  the First Priority Credit Agreement
Obligations as defined in the Collateral Trust Agreement.

 

“OPEB”: other post employment benefits.

 

“Other Taxes”:  any and all present or future stamp or
documentary taxes and any other excise or property, intangible or mortgage
recording taxes, charges or similar levies arising from any payment made
hereunder or from the execution, delivery or enforcement of, or otherwise with
respect to, this Agreement or any other Loan Document.

 

“Outstanding Amount”:  as of any date of determination (a) with
respect to Indebtedness, the aggregate outstanding principal amount thereof, (b) with
respect to banker’s acceptances, letters of credit or letters of guarantee, the
aggregate undrawn, unexpired face amount thereof plus the aggregate
unreimbursed drawn amount thereof, (c) with respect to hedging
obligations, the aggregate amount recorded by the Company or any Subsidiary as
its net termination liability thereunder calculated in accordance with the
Company’s customary accounting procedures, (d) with respect to cash
management obligations or guarantees, the aggregate maximum amount thereof (i) that
the relevant cash management provider is entitled to assert as such as agreed
from time to time by the Company or any Subsidiary and such provider or (ii) the
principal amount of the Indebtedness being guaranteed or, if less, the maximum
amount of such guarantee set forth in the relevant guarantee and (e) with
respect to any other obligations, the aggregate outstanding amount thereof.

 

“Parent Entity”:  any of Chrysler Holding LLC, a Delaware
limited liability company, or any intermediate holding company through which
Chrysler Holding LLC holds its ownership interest in the Company, including
Holdings.

 

“Participant”:  as defined in Section 9.6(c)(i).

 

“Patent Security Agreement”:  the Patent Security Agreement to be executed
and delivered by the Company and the Collateral Trustee, substantially in the
form of Exhibit D.

 

“PBGC”: 
the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).

 

“Pension Act”: the Pension Protection Act of
2006, as it now exists or as it may be amended from time to time.

 

“Permitted Second Lien Non-Loan Exposure”:  Designated Hedging Obligations, Designated
Cash Management Obligations, reimbursement obligations in respect of letters of
credit and bank guarantees, guarantees provided by the Company or a Subsidiary
Guarantor (including in respect of Indebtedness) and other obligations of the
Company or a Subsidiary Guarantor that do not constitute Indebtedness that have
been designated by the Company pursuant to the terms of the Collateral Trust
Agreement as “Permitted Second Lien Non-Loan Exposure”; provided that after
giving pro forma effect to such designation and any application of the proceeds
thereof the Borrowing Base Coverage Ratio is at 

 

18

 

least 1.00 to 1.00; provided, further, that the
aggregate Outstanding Amount of Permitted Second Lien Non-Loan Exposure shall
not exceed $1,000,000,000 at any time.

 

“Permitted Indebtedness”: means:

 

(a)     Indebtedness of any Loan
Party pursuant to any Loan Document and any Permitted First Lien Non-Loan
Exposure;

 

(b)     Indebtedness of any Loan
Party pursuant to the First Lien Credit Agreement in an aggregate amount not to
exceed $10,000,000,000, and any Permitted First Lien Non-Loan Exposure (as such
term is defined in the First Lien Credit Agreement);

 

(c)     Indebtedness of the
Company or any Subsidiary owing to the Company or any Subsidiary (including,
without limitation, intercompany ledger balances in connection with customary
cash management practices among the Company and its Subsidiaries); provided
that any such Indebtedness owing to a Subsidiary that is not a Subsidiary
Guarantor shall be subordinated by the Company or a Subsidiary Guarantor in
right of payment to the Obligations;

 

(d)     Guarantee Obligations incurred
in the ordinary course of business by the Company or any of its Subsidiaries of
obligations of any Loan Party;

 

(e)     Indebtedness outstanding
on the date hereof and listed on Schedule 6.4(d) and any Permitted
Refinancing thereof;

 

(f)      Indebtedness incurred by
the Company or any of its Subsidiaries (i) in the ordinary course of
business of the Company or such Subsidiary to finance the purchase of fixed or
capital assets that is incurred at the time of, or within 120 days after, the
acquisition of such property, or (ii) constituting Capital Lease
Obligations and Attributable Obligations, so long immediately after giving
effect to the incurrence of such Indebtedness the pro-forma Consolidated
Leverage Ratio of the Company and its Subsidiaries is less than 6.00:1.00,
provided that, the Company or any of its Subsidiaries may incur additional
Indebtedness described in this clause (f) at any time in an aggregate
principal amount not to exceed $600,000,000;

 

(g)     unsecured Indebtedness of
the Company or any of its Subsidiaries in an aggregate principal amount (for
the Company and all Subsidiaries) not to exceed $600,000,000 at any one time
outstanding, provided that, the Company or any of its Subsidiaries may incur
additional unsecured Indebtedness so long as the Pro-Forma Interest Coverage
Ratio immediately after giving effect to the incurrence of such Indebtedness is
greater than 1.60:1.00, and provided further, for all such Indebtedness
incurred under this clause (g), that (i) in the case of Material Unsecured
Indebtedness only, the terms of all such unsecured Indebtedness do not provide
for any scheduled repayment or mandatory redemption prior to the date that is
one year after the Term Loan Maturity Date as in effect on the Closing Date
(other than customary offers to purchase upon a change of control, asset sale
or event of loss and acceleration rights after an event of default) (ii) the
covenants, events of default, guarantees and other terms of such Indebtedness
(other than interest rate, call features and redemption premiums), taken as a
whole, are not more restrictive to the Company than the terms of this
Agreement; provided that a certificate of a Responsible Officer of the Company
delivered to the Administrative Agent at least five Business Days (or such shorter
period as the Administrative Agent may reasonably agree) prior to the
incurrence of such Indebtedness, together with a description of the material
terms and conditions of such Indebtedness or drafts of the documentation
relating thereto, stating that the Company has determined in good faith that
such terms and conditions satisfy the foregoing 

 

19

 

requirements and such terms
and conditions shall be deemed to satisfy the foregoing requirement unless the Administrative
Agent notifies the Company within such period that it disagrees with such
determination (including a reasonable description of the basis upon which it
disagrees) and (iii) no Default or Event of Default has occurred and is
continuing or would occur as a result of the incurrence of such Indebtedness;

 

(h)     Non-Recourse Debt or
Indebtedness guaranteed to the extent permitted by clause (p) below of
Foreign Subsidiaries and JV Subsidiaries;

 

(i)      Indebtedness of a
newly-acquired Subsidiary that is outstanding on the date such Subsidiary is
acquired; provided that (A) any such Indebtedness was not created in
contemplation of such purchase or other acquisition in contravention of Section 6.4,
and (B) the amount of such Indebtedness is permitted under Section 6.10(m);

 

(j)      Indebtedness in respect
of, represented by, or in connection with appeal, bid, performance, surety,
customs or similar bonds issued for the account of any Group Member, the
performance of bids, tenders, sales or contracts (in each case, other than for
the repayment of borrowed money), statutory obligations, workers’ compensation
claims, unemployment insurance, other types of social security or pension
benefits, self-insurance and similar obligations and arrangements, in each
case, to the extent incurred in the ordinary course of business;

 

(k)     Indebtedness in respect of
letters of credit (other than in respect of borrowed money);

 

(l)      Indebtedness arising from
industrial revenue, development bond or similar financings where the Company and/or
any Subsidiary is both the lessee of the financial property and the holder of
the bonds;

 

(m)    Indebtedness incurred
pursuant to, or as required by the terms of, a Permitted Transaction;

 

(n)     any Permitted Refinancing;

 

(o)     Indebtedness arising in the
ordinary course of business from loans, grants or other arrangements made by a
government or quasi-government entity;

 

(p)     unsecured Guarantee
Obligations of the Company or any Subsidiary in respect of Indebtedness of a
Foreign Subsidiary or JV Subsidiary;

 

(q)     Indebtedness incurred by
the Company or any of its Subsidiaries arising from agreements providing for
indemnification, adjustment of purchase price or similar obligations, in each
case, incurred or assumed in connection with acquisitions permitted by Section 6.10(m) or
permitted Dispositions of any business, asset or any Capital Stock of a
Subsidiary of the Company or any of its Subsidiaries;

 

(r)      Indebtedness of the
Company or any of its Subsidiaries in respect of netting services, overdraft
protections and other similar arrangements in connection with deposit accounts
in the ordinary course of business;

 

20

 

(s)     unsecured Guarantee
Obligations in connection with guarantees or other credit support provided by
the Company or any of its Subsidiaries for the benefit of their suppliers and
dealerships in an aggregate principal amount outstanding not to exceed
$300,000,000 at any time;

 

(t)      Guarantee Obligations of
any Group Member in respect of Indebtedness of, or Indebtedness of, marketing
investment dealerships incurred, in each case, made in the ordinary course of
business and consistent with past practices to finance vehicle inventory and
working capital; and

 

(u)           Indebtedness in
connection with credit support obligations required to be provided pursuant to (i) IDCA
with respect to Indebtedness provided by DaimlerChrysler AG or certain of its
Affiliates to certain of its Subsidiaries, which Subsidiaries are to be
transferred to the Company in accordance with the terms of the IDCA, and (ii) the
terms of the DC Credit Support Agreement.

 

“Permitted Liens”
means:

 

(a)           Liens
for taxes, assessments, governmental charges and utility charges, in each case
that are not yet subject to penalties for non-payment or that are being
contested in good faith by appropriate proceedings; provided that adequate
reserves with respect thereto are maintained on the books of the Company in
conformity with GAAP;

 

(b)           (i) Liens
incurred or pledges or deposits made in connection with (A) workers’
compensation claims, unemployment insurance or ordinary course social security
or pension benefits (but not including any Lien in favor of the PBGC), (B) to
secure the performance of bids, tenders, sales, contracts (in each case, other
than for the repayment of borrowed money), (C) statutory obligations, or (D) surety,
appeal, customs or performance bonds and similar obligations, or (ii) deposits
as security for import or customs duties or for the payment of rent, in each
case for clauses (i) and (ii) incurred in the ordinary course of
business, and (iii) carriers’, warehousemen’s, workers mechanics’,
materialmen’s, repairmen’s, construction or other like Liens arising in the
ordinary course of business to secure amounts (A) that are not overdue for
a period of more than 90 days or that may hereafter be paid without material
penalty or (B) that are being contested in good faith by appropriate
proceedings;

 

(c)           permits,
servitudes, licenses, easements, rights-of-way, restrictions and other similar
encumbrances imposed by applicable law or incurred in the ordinary course of
business or minor imperfections in title to real property that do not in the
aggregate materially interfere with the ordinary conduct of the business of the
Company and its Subsidiaries taken as a whole, including, without limitation,
the following:  (i) zoning,
entitlement, conservation restriction and other land use and environmental
regulations by one or more Governmental Authorities which do not materially
interfere with the present use of the assets of the Company and its
Subsidiaries, (ii) all covenants, conditions, restrictions, easements,
encroachments, charges, rights-of-way and any similar matters of record set
forth in any state, local or municipal franchise on title to real property of
the Company and its Subsidiaries which do not materially interfere with the
present use of such property and (iii) minor survey exceptions and matters
as to real property of the Company and its Subsidiaries which would be
disclosed by an accurate survey or inspection of such real property and do not
materially impair the occupancy or current use of such real property;

 

(d)           leases,
licenses, subleases or sublicenses of assets (including, without limitation,
real property and intellectual property rights) granted to others that do not
in the aggregate 

 

21

 

materially interfere with the ordinary conduct of the business of the
Company and its Subsidiaries taken as a whole and licenses of trademarks and
intellectual property rights in the ordinary course of business;

 

(e)           deposits
to secure Indebtedness described in clause (j) or clause (k) of the
definition of Permitted Indebtedness;

 

(f)            Liens
arising from UCC financing statement filings (or similar filings) regarding or
otherwise arising under leases entered into by the Company or any of its
Subsidiaries or in connection with sales of accounts, payment intangibles,
chattel paper or instruments;

 

(g)           Liens
securing Indebtedness and Attributable Obligations permitted by clause (f) of
the definition of Permitted Indebtedness; provided that in each case such Liens
do not encumber any property (except substitutions, replacements or proceeds
thereof) other than property financed by such Indebtedness;

 

(h)           Liens
in existence on the Closing Date and listed on Schedule 6.3 securing
Indebtedness permitted by clause (e) of the definition of Permitted
Indebtedness; provided that no such Lien covers any additional property after
the Closing Date (except substitutions, replacements or proceeds thereof) and
that the amount of Indebtedness secured thereby is not increased (except as
otherwise permitted by this Agreement);

 

(i)            Liens
on property or Capital Stock of a Person at the time such Person becomes a
Subsidiary; provided however, that such Liens are not created, incurred or
assumed in connection with, or in contemplation of, such other Person becoming
a Subsidiary; provided further, however, that any such Lien may not extend to
any other property owned by the Company or any Subsidiary;

 

(j)            Liens
securing Indebtedness under clause (n) of the definition of Permitted
Indebtedness which is incurred to extend, renew, refinance, or replace any
Indebtedness which was secured by a Lien permitted under Section 6.3; provided
that any such Liens do not cover any property or assets of the Company or its
Subsidiaries (other than substitutions, replacements or proceeds thereof) not
securing the Indebtedness so extended, renewed, refinanced or replaced;

 

(k)           any
Lien arising out of claims under a judgment or award rendered or claim filed so
long as such judgments, awards or claims do not constitute an Event of Default;

 

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

 

(m)          Liens  and rights of set off created in the ordinary
course of business in favor of banks and other financial institutions over
credit balances of any bank accounts held at such banks or financial
institutions or over investment property held in a securities account, as the
case may be, to secure fees and charges in the ordinary course of business or
returned items and charge backs in the ordinary course of business, facilitate
the operation of cash pooling and/or interest set-off arrangements in respect
of such bank accounts or securities accounts in the ordinary course of
business;

 

(n)           Liens
created pursuant to (and Liens permitted by) the Collateral Trust Agreement and
the Security Documents securing, without limitation, the Obligations, the 

 

22

 

obligations under the Second Lien Credit Agreement, any Permitted First
Lien Non Loan Exposure and any Permitted Second Lien Non-Loan Exposure;

 

(o)           Liens
securing Indebtedness or other obligations of a Subsidiary owing to the Company
or a Subsidiary Guarantor;

 

(p)           statutory
Liens incurred or pledges or deposits made in favor of a Governmental Authority
to secure the performance of obligations of the Company or any of its
Subsidiaries under Environmental Laws to which any assets of the Company or any
such Subsidiaries are subject;

 

(q)           servicing
agreements, development agreements, site plan agreements and other agreements
with Governmental Authorities pertaining to the use or development of any of
the property and assets of the Company or any of its Subsidiaries consisting of
real property, provided same are complied with (including, without limitation,
Liens that secure Indebtedness permitted by clause (o) of the definition
of Permitted Indebtedness);

 

(r)            Liens
on cash collateral pledged in favor of FinCo in an Outstanding Amount not
exceeding $2,000,000,000 to secure obligations owed to FinCo or any of its
Subsidiaries by the Company and its Subsidiaries to the extent contemplated by
the Master Agreement;

 

(s)           Liens
not otherwise permitted by the foregoing clauses securing obligations or other
liabilities of any Loan Party; provided that the Outstanding Amount of all such
obligations and liabilities shall not exceed $120,000,000 at any time;

 

(t)            Liens
on the assets of Foreign Subsidiaries and JV Subsidiaries securing Indebtedness
of a Foreign Subsidiary or JV Subsidiary permitted under clause (h) of the
definition of Permitted Indebtedness;

 

(u)           pledges
or deposits of cash, Cash Equivalents or Temporary Cash Investments made to
secure obligations in respect of Swap Agreements permitted hereunder and which
are not Designated Hedging Obligations;

 

(v)           Liens
incurred pursuant to the terms of a Permitted Transaction, limited, in each
case, to the assets subject to such Permitted Transaction; and

 

(w)          Liens
on cash collateral in an amount not to exceed $200,000,000 to support
obligations to the PBGC for accelerated funding incurred in connection with the
closing of the Acquisition until such obligations have been paid.

 

“Permitted Refinancing”:  any Indebtedness (or preferred Capital Stock,
as the case may be) issued in exchange for, or the net proceeds of which are
used to extend, refinance, renew, replace, defease, discharge or refund other
Permitted Indebtedness (or preferred Capital Stock, as the case may be); provided
that:

 

(a)           the
principal amount (or accreted value, if applicable) of such Indebtedness (or
preferred Capital Stock, as the case may be) does not exceed the principal
amount (or accreted value, if applicable) of the Indebtedness (or preferred
Capital Stock, as the case may be) so extended, refinanced, renewed, replaced,
defeased, discharged or refunded (plus all accrued interest thereon and the
amount of all fees, expenses and premiums incurred in connection therewith);

 

23

 

(b)           such
Indebtedness (or preferred Capital Stock, as the case may be) has a final
maturity date 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 (or preferred Capital Stock, as the case may be) being
extended, refinanced, renewed, replaced, defeased, discharged or refunded; and

 

(c)           the
terms of such Indebtedness (or preferred Capital Stock, as the case may be),
taken as a whole, are not more restrictive to the applicable obligor than the
Indebtedness (or preferred Capital Stock, as the case may be) being extended,
refinanced, renewed, replaced, defeased, discharged or refunded (other than
with respect to interest rates, fees, liquidation preferences, premiums and no
call periods).

 

“Permitted Transactions”:  individually and collectively:  (i) the Conversion Vehicle Wholesale
Financing Program; (ii) the Fenton IRB Transactions; (iii) the Gelco
Lease Program; (iv) the Gold Key Lease Program; (v) the proposed sale
and financing of the Auburn Hills Property and related transactions in
connection therewith; and (vi) the Company Car Financing Program.

 

“Person”: 
an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.

 

“Plan”: 
any employee pension benefit plan (other than a Multiemployer Plan) that
is subject to the provisions of Title IV of ERISA or Section 412 of the
Code and in respect of which the Company or a Commonly Controlled Entity is
(or, if such plan were terminated at such time, would under Section 4069
of ERISA be deemed to be) an “employer” as defined in Section 3(5) of
ERISA.

 

“Post-Closing Deliverables”:  as defined in Section 5.7(e).

 

“Prime Rate”: 
the rate of interest per annum publicly announced from time to time by
JPMorgan Chase Bank, N.A. as its prime rate in effect at its principal office
in New York City (the Prime Rate not being intended to be the lowest rate of
interest charged by JPMorgan Chase Bank, N.A. in connection with extensions of
credit to borrowers).

 

“Principal Trade Names”:  each of the trademarks listed under the
heading “Principal Trade Names” on Schedule 1.1F and all other Trademarks consisting of or containing any of the
trademarks listed under the heading “Principal Trade Names” on Schedule 1.1F or
any variation or simulation thereof.

 

“Pro forma Balance Sheet”:  as defined in Section 3.1.

 

“Pro forma Cost Savings”:  means, with respect to any period, the
reduction in net costs and related adjustments that (i) were directly
attributable to an acquisition or a disposition that occurred during the
four-quarter period or after the end of the four-quarter period and on or prior
to the applicable calculation date and calculated on a basis that is consistent
with Regulation S-X, (ii) were actually implemented by the business that
was the subject of any such acquisition or disposition within six months after
the date of the acquisition or disposition and prior to the applicable
calculation date that are supportable and quantifiable by the underlying
accounting records of such business or (iii) relate to the business that
is the subject of any such acquisition or disposition and that the Company
reasonably determines are probable based upon specifically identifiable actions
to be taken within six months of the date of the acquisition or disposition
and, in the case of each of (i), (ii) and (iii), are described, as
provided below, in an officers’ certificate, as if all such reductions in costs
had been effected as of the beginning of such period.  Pro Forma Cost Savings described above shall
be set forth in a certificate delivered to the 

 

24

 

Administrative Agent from the Company’s chief
financial officer that outlines the specific actions taken or to be taken, the
net cost savings achieved or to be achieved from each such action and that, in
the case of clause (iii) above, such savings have been determined to be
probable.

 

“Pro-Forma Interest Coverage Ratio”:  with respect to the incurrence of any
Indebtedness, the ratio of EBITDA of the Company and its consolidated
Subsidiaries to cash Interest Expense (net of interest income) of the Company
and its consolidated Subsidiaries for the twelve month period ending on the
last day of the most recent fiscal period for which the Company has delivered
financial statements pursuant to Section 5.1 prior to the incurrence of such
Indebtedness, provided that, for the purposes of determining Interest Expense
for such twelve month period such Indebtedness shall have been deemed to have
been incurred on the first day of such period and amortization of debt issuance
costs and amortization of original issue discount shall be excluded.

 

“Projections”:  as defined in Section 5.3(c).

 

“Real Estate Deliverables”:  each of the items described on Schedule 1.1H,
and required to be delivered to the Administrative Agent in accordance with Section 5.7(e).

 

“Recovery Event”:  any settlement of or payment in respect of
any property or casualty insurance claim or any condemnation proceeding
relating to any asset of any Group Member which results in receipt of Net Cash
Proceeds by a Group Member in an amount in excess of $250,000,000.

 

“Register”: 
as defined in Section 9.6(b)(iv).

 

“Regulation H”:  Regulation H of the Board as in effect from
time to time.

 

“Regulation S-X”:  Regulation S-X under the Securities Act of
1933, as amended.

 

“Regulation U”:  Regulation U of the Board as in effect from
time to time.

 

“Reinvestment Deferred Amount”:  with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by any Group Member in connection
therewith that are not applied to prepay the Term Loans pursuant to Section 2.5(a) as
a result of the delivery of a Reinvestment Notice.

 

“Reinvestment Event”:  any Asset Sale or Recovery Event in respect
of which the Company has delivered a Reinvestment Notice.

 

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

 

“Reinvestment Prepayment Amount”:  with respect to any Reinvestment Event, the
Reinvestment Deferred Amount relating thereto less any amount expended prior to
the relevant Reinvestment Prepayment Date to acquire or repair assets useful in
the Company’s business.

 

“Reinvestment Prepayment Date”:  with respect to any Reinvestment Event, the
earlier of (a) the date occurring eighteen months after such Reinvestment
Event and (b) the date on which the Company shall have determined not to,
or shall have otherwise ceased to, acquire or repair assets useful in the
Company’s business with all or any portion of the relevant Reinvestment
Deferred Amount.

 

25

 

“Reorganization”:  with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.

 

“Replaced Term Loan”:  as defined in Section 9.1(c).

 

“Replacement Term Loan”:  as defined in Section 9.1(c).

 

“Reportable Event”:  any of the events set forth in Section 4043(c) of
ERISA or the regulations issued thereunder, other than those events as to which
the thirty day notice period referred to in Section 4043(c) of ERISA
have been waived.

 

“Required Lenders”:  at any time, Lenders with Aggregate Exposures
constituting a majority of the Aggregate Exposures of all Lenders.

 

“Requirements of Law”:  as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of
an arbitrator or a court of competent jurisdiction or other Governmental
Authority, in each case applicable to and binding upon such Person and any of
its property, and to which such Person and any of its property is subject.

 

“Responsible Officer”:  the chief executive officer, president, chief
accounting officer, chief financial officer, treasurer, assistant treasurer or
controller or, for the purposes of Section 5.6 only, to include the
secretary of the Company, or, in each case, any individual with a substantially
equivalent title.

 

“Restricted Cash”:  cash, Cash Equivalents and Temporary Cash
Investments of the Company or any of its Subsidiaries (i) that is subject
to a Lien (other than the Liens created pursuant to the Collateral Trust
Agreement and the Security Documents and other than ordinary course set off
rights of depository banks for charges and fees related to amounts held
therewith), or (ii) the use of which is otherwise restricted pursuant to
any Requirement of Law or Contractual Obligation.  Notwithstanding the foregoing, none of the
cash, Cash Equivalents and Temporary Cash Investments of the Company or any of
its Subsidiaries deposited with a trustee of any short term or long-term VEBA
which the Company or relevant Subsidiary may access on an unrestricted basis
for use in its business shall constitute Restricted Cash.

 

“Restricted Payments”:  as defined in Section 6.6.

 

“S&P”: 
Standard & Poor’s Ratings Services and its successors.

 

“Sale/Leaseback Transaction”: as defined in Section 6.9.

 

“SEC”: 
the Securities and Exchange Commission, any successor thereto and any
analogous Governmental Authority.

 

“Secured Parties”:  as defined in the Collateral Trust Agreement.

 

“Security Agreement”:  the Security Agreement to be executed and
delivered by the Company, Holdings and each Subsidiary Guarantor, substantially
in the form of Exhibit A.

 

“Security Documents”:  the collective reference to the Security
Agreement, the Mortgages, the Trademark Security Agreement, the Patent Security
Agreement and the Copyright 

 

26

 

Security Agreement, and all other security documents
hereafter delivered to the Administrative Agent granting a Lien on any property
of any Person to secure the Secured Obligations (as defined in the Collateral
Trust Agreement).

 

“Solvent”: 
when used with respect to any Person, means that, as of any date of
determination, (a) the amount of the “present fair saleable value” of the
assets of such Person will, as of such date, exceed the amount of all “liabilities
of such Person, contingent or otherwise”, as of such date, as such quoted terms
are determined in accordance with applicable federal and state laws governing
determinations of the insolvency of debtors, (b) the present fair saleable
value of the assets of such Person will, as of such date, be greater than the
amount that will be required to pay the liability of such Person on its debts
as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they
mature.  For purposes of this definition,
(i) “debt” means liability on a “claim”, and (ii) “claim” means any (x) right
to payment, whether or not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured or (y) right to an equitable remedy
for breach of performance if such breach gives rise to a right to payment,
whether or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

 

“Sponsor”: 
Cerberus Capital Management, L.P., any of its Affiliates and any
affiliated investment funds or managed accounts which are managed or advised by
Cerberus Capital Management, LP or one of its Affiliates.

 

“Subsidiary”: 
with respect to any Person, any corporation, association, joint venture,
partnership, limited liability company or other business entity (whether now
existing or hereafter organized) of which at least a majority of the Voting
Stock is, at the time as of which any determination is being made, owned or
controlled by such Person or one or more subsidiaries of such Person or by such
Person and one or more subsidiaries of such Person.  Unless otherwise qualified, all references to
a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a
Subsidiary or Subsidiaries of the Company.

 

“Subsidiary Guarantor”:  each Initial Subsidiary Guarantor, each
Additional Subsidiary Guarantor and each other Subsidiary (including any JV
Subsidiary) that becomes a party to the Guarantee and the Security Agreement
after the Closing Date pursuant to Section 5.7 or otherwise.

 

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

 

“Syndication Agents”:  as defined in the preamble hereto.

 

“Taxes”: any taxes, charges or assessments,
including but not limited to income, sales, use, transfer, rental, ad valorem,
value-added, stamp, property, consumption, franchise, license, capital, net
worth, gross receipts, excise, occupancy, intangibles or similar tax, charges
or assessments.

 

“Temporary Cash Investments”: any of the
following:

 

27

 

(a)           any
investment in direct obligations of the United States of America or any agency
thereof or obligations guaranteed by the United States of America or any agency
thereof;

 

(b)           investments
in demand and time deposit accounts, certificates of deposit, acceptances and
money market deposits maturing within 360 days of the date of acquisition
thereof issued by a bank or trust company which is organized under the laws of
the United States of America, any State thereof or any foreign country
recognized by the United States of America, and which bank or trust company has
capital, surplus and undivided profits aggregating in excess of $100.0 million
(or the foreign currency equivalent thereof) and has outstanding debt which is
rated “A” (or such similar equivalent rating) or higher by at least one
nationally recognized statistical rating organization (as defined in Rule 436
under the Securities Act) or any money-market fund sponsored by a registered
broker dealer or mutual fund distributor;

 

(c)           repurchase
reverse purchase obligations with a term of not more than 60 days for
underlying securities of the type described in clause (a) above entered
into with a bank meeting the qualifications described in clause (b) above;

 

(d)           investments
in commercial paper and securities, maturing not more than 180 days after the
date of acquisition, issued by a corporation organized and in existence under
the laws of the United States of America or any foreign country recognized by
the United States of America with a rating at the time as of which any
investment therein is made of “P-1” (or higher) according to Moody’s or “A-1”
(or higher) according to S&P;

 

(e)           investments
in securities with maturities of six months or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States of America, or by any political subdivision or taxing
authority thereof, and rated at least “A” by S&P or “A” by Moody’s.;

 

(f)            investments
in money market funds that invest substantially all their assets in securities
of the types described in clauses (a) through (d) above;

 

(g)           Investments
in any foreign equivalents of the securities described in clause (a) through
(d) or (f) above; and

 

(h)           Investments
in any Liquid Securities .

 

“Term Commitment”:  as to any Lender, the obligation of such
Lender, if any, to make a Term Loan to the Company in a principal amount not to
exceed the amount set forth under the heading “Term Commitment” opposite such
Lender’s name on Schedule 1.1A or, as the case may be, in the Assignment and
Assumption pursuant to which such Lender became a party hereto, as the same may
be changed from time to time pursuant to the terms hereof.  The original aggregate amount of the
aggregate Term Loan Commitments is $2,000,000,000.

 

“Term Lender”:  each Lender that has a Term Commitment or
that holds a Term Loan.

 

“Term Loans”: 
as defined in Section 2.1.

 

“Term Loan Maturity Date”:  February 3, 2014.

 

“Term Note”: 
as defined in Section 2.11(h).

 

28

 

“Trademark”: trademarks,
trade names, business names, trade styles, service marks, logos and other
source or business identifiers, and in each case, all goodwill associated
therewith, and all registrations and recordations thereof and all rights to
obtain renewals and extensions thereof.

 

“Trademark Security Agreement”:  the Trademark Security Agreement to be
executed and delivered by the Company and the Collateral Trustee, substantially
in the form of Exhibit D.

 

“Transferee”: 
any Assignee or Participant.

 

“Treasury
Rate”:  with respect to any date of
determination, the yield to maturity at the time of computation of United
States Treasury
securities with a constant maturity (as compiled and published in the most
recent Federal Reserve Statistical Release H.15(519) that has become publicly
available at least two Business Days prior to such date (or, if such
Statistical Release is no longer published, any publicly available source of
similar market data)) most nearly equal to the period from such date to the
first day after the second anniversary of the Closing Date; provided, however,
that if the period from such date to the first day after the second anniversary
of the Closing Date is not equal to the constant maturity of a United States
Treasury security for which a weekly average yield is given, the Treasury Rate
shall be obtained by linear interpolation (calculated to the nearest
one-twelfth of a year) from the weekly average yields of United States Treasury
securities for which such yields are given, except that if the period from such
date to the first date after the second anniversary of the Closing Date is less
than one year, the weekly average yield on actually traded United States
Treasury securities adjusted to a constant maturity of one year shall be used.

 

“Type”: 
as to any Term Loan, its nature as an ABR Loan or a Eurodollar Loan.

 

“UCC”: 
the Uniform Commercial Code as in effect from time to time in any
applicable jurisdiction.

 

“United States”:  the United States of America.

 

“VEBA”: Voluntary Employee’s Beneficiary
Association.

 

“Voting Stock”:  with respect to any Person, such Person’s
Capital Stock having the right to vote for election of directors (or the
equivalent thereof) of such Person under ordinary circumstances.

 

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

 

“Wholly Owned Subsidiary Guarantor”:  any Subsidiary Guarantor that is a Wholly
Owned Subsidiary of the Company.

 

“Withdrawal Liability”: 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.

 

1.2.          Other
Definitional Provisions.  (a) 
As used in this Agreement, the terms listed in Schedule 1.1B shall have the
respective meanings set forth in such Schedule 1.1B.  Unless otherwise specified therein, all terms
defined in this Agreement shall have the defined meanings when used in the
other Loan Documents or any certificate or other document made or delivered
pursuant hereto or thereto.

 

29

 

(b)           As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto, (i) accounting
terms not defined in Section 1.1 and accounting terms partly defined in Section 1.1,
to the extent not defined, shall have the respective meanings given to them under
GAAP, (ii) the words “include”, “includes” and “including” shall be deemed
to be followed by the phrase “without limitation”, (iii) the word “incur”
shall be construed to mean incur, create, issue, assume, become liable in
respect of or suffer to exist (and the words “incurred” and “incurrence” shall
have correlative meanings), (iv) the words “asset” and “property” shall be
construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, Capital Stock,
securities, revenues, accounts, leasehold interests and contract rights, (v) references
to agreements or other Contractual Obligations shall, unless otherwise
specified, be deemed to refer to such agreements or Contractual Obligations as
amended, supplemented, restated or otherwise modified from time to time and (vi) references
to any Person shall include its successors and assigns.

 

(c)           The words “hereof”, “herein” and “hereunder” and words of
similar import, when used in this Agreement, shall refer to this Agreement as a
whole (including the Schedules and Exhibits hereto) and not to any particular
provision of this Agreement (or the Schedules and Exhibits hereto), and
Section, Schedule and Exhibit references are to this Agreement unless
otherwise specified.

 

(d)           The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.

 

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

 

(b)           The Administrative Agent may set up appropriate rounding
off mechanisms or otherwise round-off amounts hereunder to the nearest higher
or lower amount in whole Dollar or cent to ensure amounts owing by any party
hereunder or that otherwise need to be calculated or converted hereunder are
expressed in whole Dollars or in whole cents, as may be necessary or
appropriate.

 

SECTION 2            AMOUNT AND TERMS OF COMMITMENTS

 

2.1.          Term
Commitments.  Subject to the
terms and conditions hereof, provided that an Event of Default set forth in Section 7(e) has
not occurred and is continuing, each Term Lender severally agrees to make a
single term loan (a “Term Loan”) in Dollars to the Company on a single
date (the “Draw Date”) on or prior to the Commitment Termination Date in
an amount not to exceed the amount of the Term Commitment of such Lender.  The Term Loans may from time to time be
Eurodollar Loans or ABR Loans, as determined by the Company and notified to the
Administrative Agent in accordance with Sections 2.2 and 2.6.

 

2.2.          Procedure
for Term Loan Borrowing.  The Company
shall give the Administrative Agent notice (which notice must be received by
the Administrative Agent prior to (a) 12:00 Noon, New York City time, two
Business Days prior to the anticipated Draw Date, in the case of Eurodollar
Loans, or (b) 12:00 Noon, New York City time, one Business Day prior to
the anticipated Draw Date, in the case of ABR Loans) requesting that the Term
Lenders make the Term Loans on the Draw Date and specifying, (i) the
amount and Type to be borrowed and (ii) in the case of Eurodollar Loans,
the respective lengths of the initial Interest Period(s) therefor, which
shall be one month.  Upon receipt of such
notice the Administrative Agent shall promptly notify each Term Lender
thereof.  Not later than 12:00 Noon, New
York City time, on the Draw Date each Term Lender shall make available to 

 

30

 

the Administrative Agent at the Funding
Office an amount in immediately available funds equal to the Term Loan or Term
Loans to be made by such Lender.  The
failure of any Term Lender to make any Term Loan required to be made by it
shall not relieve any other Term Lender of its obligations hereunder.  The Administrative Agent shall credit the
account of the Company on the books of such office of the Administrative Agent
or such other account as the Company shall specify in writing with the
aggregate of the amounts made available to the Administrative Agent by the Term
Lenders in immediately available funds on such date.

 

2.3.          Repayment
of Term Loans.  The Company
shall repay in full all outstanding Term Loans on the Term Loan Maturity Date.

 

2.4.          Optional
Prepayments.  At any time
following the repayment of all Indebtedness outstanding under the First Lien Credit
Agreement and the termination of the commitments thereunder, the Company may at any time and from time to
time prepay the Loans, in whole or in part, without premium or penalty (except
as provided in Section 2.11(b)), upon irrevocable notice delivered to the
Administrative Agent no later than 12:00 Noon, New York City time, three
Business Days prior thereto, in the case of Eurodollar Loans, and no later than
12:00 Noon, New York City time, on the day of such prepayment, in the case of
ABR Loans, which notice shall specify the date and amount of such prepayment
and whether the prepayment is of Eurodollar Loans or ABR Loans; provided,
that if a Eurodollar Loan is prepaid on any day other than the last day of the
Interest Period applicable thereto, the Company shall also pay any amounts
owing pursuant to Section 2.14; provided, further, that such
notice to prepay the Loans delivered by the Company may state that such notice
is conditioned upon the effectiveness of other credit facilities or a Change of
Control, in either case, which notice may be revoked by the Company (by further
notice to the Administrative Agent on or prior to the specified effective date)
if such condition is not satisfied. 
Notwithstanding the foregoing, the revocation of a prepayment notice
shall not affect the Company’s obligation to indemnify any Lender in accordance
with Section 2.14 for any loss or expense sustained or incurred as a
consequence thereof.  Upon receipt of any
such notice the Administrative Agent shall promptly notify each relevant Lender
thereof.  If any such notice is given,
the amount specified in such notice shall be due and payable on the date
specified therein, together with accrued interest to such date on the amount
prepaid.  Partial prepayments of Term
Loans shall be in an integral multiple of $1,000,000 and no less than
$10,000,000.

 

2.5.          Mandatory
Prepayments.  (a)

 

(i)            If (A) any
Indebtedness shall be incurred by any Group Member (excluding any Permitted
Indebtedness), an amount equal to 100% of the Net Cash Proceeds thereof shall
be applied on the date of such incurrence toward the prepayment of the Term
Loans as set forth in Sections 2.5(b) and 2.11(b), or (B) any Capital
Stock shall be issued by any Group Member (other than to a Wholly Owned
Subsidiary Guarantor and other than with respect to Capital Stock issued in
accordance with Section 7(c), 6.6(d) or as a result of a contribution
of capital to the Company by the Sponsor) and after giving pro forma effect to
such issuance and application of the proceeds thereof, the Consolidated
Leverage Ratio of the Company and its Subsidiaries for the twelve month period
ending on the last day of the most recent fiscal period for which the Company
has delivered financial statements pursuant to Section 5.1 prior to the issuance
of such Capital Stock is greater than 3.00:1.00, in each case on a pro-forma
basis giving effect to the use of proceeds thereof, an amount equal to 50% of
the Net Cash Proceeds (or such lesser amount as shall result in such
Consolidated Leverage Ratio being less than 3.00:1.00) thereof shall be applied
on the date of such issuance toward the prepayment of the Term Loans as set
forth in Sections 2.5(b) and 2.11(b).

 

31

 

(ii)           If on any date any
Group Member shall receive Net Cash Proceeds from any Asset Sale that are
required to be applied as a Mandatory Prepayment pursuant to Section 6.5,
or in respect of a Recovery Event then, unless a Reinvestment Notice shall be
delivered in respect thereof, an amount equal to such Net Cash Proceeds shall
be applied promptly, and in any event not later than five Business Days after
the date of receipt by such Group Member of such Net Cash Proceeds, toward the
prepayment of the Term Loans as set forth in Sections 2.5(b) and 2.11(b);
provided, that, notwithstanding the foregoing on each Reinvestment Prepayment
Date, an amount equal to the Reinvestment Prepayment Amount with respect to the
relevant Reinvestment Event shall be applied toward the prepayment of the Term
Loans as set forth in Sections 2.5(b) and 2.11(d).

 

; provided,
that any amounts payable hereunder shall be applied first to prepay
Indebtedness under the First Lien Credit Agreement, and only after payment in
full of all such Indebtedness under the First Lien Credit Agreement shall such
amounts be applied towards the prepayment of the Term Loans as set forth
hereunder. If any
event requiring a Mandatory Prepayment pursuant to this Section 2.5 shall
occur, the Company shall notify the Administrative Agent of any such Mandatory
Prepayment no later than 12:00 Noon, New York City time, one Business Day prior
thereto.  If more than one Eurodollar
Tranche is outstanding, such prepayment shall be applied to such tranches in
the order specified by the Company or, if not specified, to the tranches
starting with the shortest remaining Interest Periods.

 

(b)           Amounts to be applied in connection with prepayments of
the outstanding Term Loans pursuant to this Section 2.5 shall be applied,
first, to ABR Loans and, second, to Eurodollar Loans and, in each case, in
accordance with Section 2.11(b). 
Each prepayment of the Term Loans under this Section 2.5 shall be
accompanied by accrued interest to the date of such prepayment on the amount
prepaid and without premium or penalty (except as provided in Section 2.11(b)).

 

2.6.          Conversion
and Continuation Options.  (a) The
Company may elect from time to time to convert Eurodollar Loans to ABR Loans by
giving the Administrative Agent prior irrevocable notice of such election no
later than 11:00 A.M., New York City time, on the third Business Day
preceding the proposed conversion date, provided that any such conversion of
Eurodollar Loans that is not made on the last day of an Interest Period with
respect thereto shall be subject to Section 2.14.  The Company may elect from time to time to
convert ABR Loans to Eurodollar Loans by giving the Administrative Agent prior
irrevocable notice of such election no later than 12:00 Noon, New York City
time, on the third Business Day preceding the proposed conversion date (which
notice shall specify the length of the initial Interest Period therefor);
provided that no ABR Loan may be converted into a Eurodollar Loan when any
Event of Default has occurred and is continuing and the Administrative Agent or
the Required Lenders have determined in its or their sole discretion not to
permit such conversions.  Upon receipt of
any such notice the Administrative Agent shall promptly notify each relevant
Lender and the Company thereof.

 

(b)           Any Eurodollar Loan may be continued as such upon the
expiration of the then current Interest Period (or may be divided into
additional Eurodollar Tranches) with respect thereto by the Company giving
irrevocable notice to the Administrative Agent, in accordance with the applicable
provisions of the term “Interest Period” set forth in Section 1.1, of the
length of the next Interest Period(s) to be applicable to such Loans;
provided that no Eurodollar Loan may be continued (or divided) as such when any
Event of Default has occurred and is continuing and the Administrative Agent
has or the Required Lenders have determined in its or their sole discretion not
to permit such continuations (and the Administrative Agent shall notify the
Company within a reasonable amount of time of any such determination); and
provided, further, that if the Company shall fail to give any required notice
as described above in this paragraph such Loans shall be automatically
continued as a Eurodollar Loan, on the last day of such then expiring Interest
Period and shall have an Interest Period of the same duration as 

 

32

 

such expiring Interest Period. 
Upon receipt of any such notice (or any such automatic continuation),
the Administrative Agent shall promptly notify each relevant Lender and the
Company thereof.

 

2.7.          Limitations
on Eurodollar Tranches. 
Notwithstanding anything to the contrary in this Agreement, all
borrowings, conversions and continuations of Eurodollar Loans and all
selections of Interest Periods shall be in such amounts and be made pursuant to
such elections so that no more than 20 Eurodollar Tranches shall be outstanding
at any one time.

 

2.8.          Interest
Rates and Payment Dates/Fee Payment Dates/Fees.  (a)  Each Eurodollar Loan shall bear interest
for each day during each Interest Period with respect thereto at a rate per
annum equal to, the Eurodollar Rate determined for such Interest Period plus
the Applicable Margin.

 

(b)           Each ABR Loan shall bear interest at a rate per annum
equal to the ABR plus the Applicable Margin.

 

(c)           (i) If all or a portion of the principal amount of
any Loan shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall bear interest at a rate
per annum equal to the rate that would otherwise be applicable thereto pursuant
to the foregoing provisions of this Section plus 2% per annum and (ii) if
all or a portion of any interest payable on any Loan or prepayment premium
payable hereunder shall not be paid when due (whether at the stated maturity,
by acceleration or otherwise), such overdue amount shall bear interest at a
rate per annum equal to the rate then applicable to ABR Loans plus 2% per
annum, in each case, with respect to clauses (i) and (ii) above, from
the date of such non-payment until such amount is paid in full (as well after
as before judgment).

 

(d)           Interest shall be payable in arrears on each Interest
Payment Date, provided that interest accruing pursuant to paragraph (c) of
this Section shall be payable from time to time on demand.

 

(e)           The Company agrees to pay to the Administrative Agent for
the account of each Term Lender a commitment fee for the period from and
including the Closing Date (or such later date as of which such Lender shall
become a Lender hereunder) to the earlier of the Draw Date or the Commitment
Termination Date, computed at the Commitment Fee
Rate on the undrawn Term Commitments, calculated daily, of such Lender during
the related Fee Payment Period for which payment is made, payable in arrears on
each Fee Payment Date, commencing on the first such date to occur after the
date hereof.

 

(f)            The Company agrees to pay to the Administrative Agent the
fees in the amounts and on the dates as set forth in any fee agreements with the Administrative Agent.

 

2.9.          Computation
of Interest and Fees.  (a) 
Interest and fees payable pursuant hereto shall be calculated on the basis of a
360-day year for the actual days elapsed, except that with respect to ABR Loans
the rate of interest on which is calculated on the basis of the Prime Rate, the
interest thereon shall be calculated on the basis of a 365- (or 366-) day year
for the actual days elapsed.  The
Administrative Agent shall as soon as practicable notify the Company and the
relevant Lenders of each determination of a Eurodollar Rate.  Any change in the interest rate on a Loan
resulting from a change in the ABR or the Eurocurrency Reserve Requirements
shall become effective as of the opening of business on the day on which such
change becomes effective.  The
Administrative Agent shall as soon as practicable notify the Company and the
relevant Lenders of the effective date and the amount of each such change in
interest rate.

 

33

 

(b)           Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement shall be
conclusive and binding on the Company, and the Lenders in the absence of
manifest error.  The Administrative Agent
shall, at the request of the Company, deliver to the Company a statement
showing the quotations used by the Administrative Agent in determining any
interest rate pursuant to Section 2.9(a).

 

2.10.        Inability
to Determine Interest Rate; Illegality. 
(a)  If prior to the first day of any Interest Period:

 

(i)            the Administrative
Agent shall have determined (which determination shall be conclusive and
binding upon the Company) that, by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist for ascertaining
the Eurodollar Rate for such Interest Period, or

 

(ii)           the Administrative
Agent shall have received notice from the Required Lenders that the Eurodollar
Rate determined or to be determined for such Interest Period will not
adequately and fairly reflect the cost to such Lenders (as conclusively
certified by such Lenders) of making or maintaining their affected Loans during
such Interest Period;

 

the Administrative Agent shall give telecopy
or telephonic notice thereof to the Company and the relevant Lenders as soon as
practicable thereafter.  If such notice
is given pursuant to clause (i) or (ii) of this Section 2.10(a) in
respect of Eurodollar Loans, then (1) any Eurodollar Loans requested to be
made on the first day of such Interest Period shall be made as ABR Loans, (2) any
ABR Loans that were to have been converted on the first day of such Interest
Period to Eurodollar Loans shall be continued as ABR Loans and (3) any
outstanding Eurodollar Loans shall be converted, on the last day of the
then-current Interest Period, to ABR Loans. 
Until such relevant notice has been withdrawn by the Administrative
Agent, no further Eurodollar Loans shall be made or continued as such, nor
shall the Company have the right to convert ABR Loans to Eurodollar Loans.

 

(b)           If the adoption of or any change in any Requirement of Law
or in the interpretation or application thereof shall make it unlawful for any
Lender to make or maintain Eurodollar Loans as contemplated by this Agreement,
such Lender shall give notice thereof to the Administrative Agent and the
Company describing the relevant provisions of such Requirement of Law,
following which, in the case of Eurodollar Loans, (A) the commitment of
such Lender hereunder to make Eurodollar Loans, continue such Eurodollar Loans
as such and convert ABR Loans to Eurodollar Loans shall forthwith be cancelled
and (B) such Lender’s outstanding Eurodollar Loans denominated in Dollars
shall be converted automatically on the last day of the then current Interest
Periods with respect to such Loans (or within such earlier period as shall be
required by law) to ABR Loans.

 

If any such conversion or
prepayment of a Eurodollar Loan occurs on a day which is not the last day of
the then current Interest Period with respect thereto, the Company shall pay to
such Lender such amounts, if any, as may be required pursuant to Section 2.14.

 

2.11.        Pro
Rata Treatment and Payments; Evidence of Debt.  (a)  Each borrowing by the Company from
the Lenders hereunder, and any reduction of the Commitments of the Lenders
shall be made pro rata according to the respective Aggregate Exposure
Percentages of the relevant Lenders except to the extent required or permitted
pursuant to Section 2.16.

 

(b)           Each payment (including each prepayment) by the Company on
account of principal of and interest on the Term Loans shall be made pro rata
according to the respective outstanding principal amounts of the Term Loans
then held by the Term Lenders except to the extent required or

 

34

 

permitted pursuant to Section 2.16.  The amount of each principal prepayment of
the Term Loans shall be applied to reduce the then remaining installments of
the Term Loans as directed by the Company. 
Amounts paid on account of the Term Loans may not be reborrowed.  In the event that the Term Loans are paid (or
are due to be paid) in whole or in part by the Company pursuant to Section 2.4,
2.5, 2.16 (other than clauses (b) or (c) thereof), or 9.1(c) or
after acceleration thereof following an Event of Default, the Company shall pay
to the relevant Term Lenders a prepayment premium as follows:  (a) the Applicable Premium if such
repayment occurs on or prior to the first anniversary of the Closing Date and (b) 5.00%
on the principal amount so repaid (or to be paid) if such repayment occurs
after the first anniversary of the Closing Date but on or prior to the second
anniversary of the Closing Date, (c) 3.00% on the principal amount so
repaid (or to be paid) if such repayment occurs after the second anniversary of
the Closing Date but on or prior to the third anniversary of the Closing Date,
and (d) 1.00% on the principal amount so repaid (or to be paid) if such
repayment occurs after the third anniversary of the Closing Date but prior to
the fourth anniversary of the Closing Date.

 

(c)           Reserved.

 

(d)           All payments (including prepayments) to be made by the
Company hereunder, whether on account of principal, interest, fees or
otherwise, shall be made without setoff or counterclaim and shall be made prior
to 3:00 P.M., New York City time, on the due date thereof to the
Administrative Agent, for the account of the Lenders, at the Funding Office, in
Dollars and in immediately available funds. 
The Administrative Agent shall distribute such payments to the Lenders
promptly upon receipt in like funds as received.  If any payment hereunder (other than payments
on the Eurodollar Loans) becomes due and payable on a day other than a Business
Day, such payment shall be extended to the next succeeding Business Day.  If any payment on a Eurodollar Loan becomes
due and payable on a day other than a Business Day, the maturity thereof shall
be extended to the next succeeding Business Day unless the result of such extension
would be to extend such payment into another calendar month, in which event
such payment shall be made on the immediately preceding Business Day.  In the case of any extension of any payment
of principal pursuant to the preceding two sentences, interest thereon shall be
payable at the then applicable rate during such extension.

 

(e)           Unless the Administrative Agent shall have been notified
in writing by any Lender prior to a borrowing that such Lender will not make
the amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the
Administrative Agent may, in reliance upon such assumption, make available to
the Company a corresponding amount.  If
such amount is not made available to the Administrative Agent by the required
time on the Borrowing Date therefor and the Administrative Agent has made such
amount available to the Company, such Lender shall pay to the Administrative
Agent, on demand, such amount with interest thereon at a rate up to the greater
of (i) the Federal Funds Effective Rate and (ii) a rate determined by
the Administrative Agent in accordance with banking industry rules on
interbank compensation, in each case for the period until such Lender makes
such amount immediately available to the Administrative Agent.  A certificate of the Administrative Agent
submitted to any Lender with respect to any amounts owing under this paragraph
shall be conclusive in the absence of manifest error.  If such Lender’s share of such borrowing is
not made available to the Administrative Agent by such Lender within three
Business Days after such Borrowing Date, the Administrative Agent shall also be
entitled to recover such amount with interest thereon at the rate per annum
applicable to ABR Loans.

 

(f)            Unless the Administrative Agent shall have been notified
in writing by the Company prior to the date of any payment due to be made by
the Company hereunder that the Company will not make such payment to the
Administrative Agent, the Administrative Agent may assume that the Company is
making such payment, and the Administrative Agent may, but shall not be
required to, in

 

35

 

reliance upon such assumption, make available
to the Lenders their respective pro rata shares of a corresponding amount.  If such payment is not made to the
Administrative Agent by the Company within three Business Days after such due
date, the Administrative Agent shall be entitled to recover, on demand, from
each Lender to which any amount which was made available pursuant to the
preceding sentence, in the case of amounts denominated in Dollars, such amount
with interest thereon at the rate per annum equal to the daily average Federal
Funds Effective Rate.  Nothing herein
shall be deemed to limit the rights of the Administrative Agent or any Lender
against the Company.

 

(g)           Notwithstanding anything to the contrary in this Section 2.11,
proceeds of the Collateral that are applied to pay the Loans while a Notice of
Event of Default is in effect shall be applied pursuant to Section 3.4 of
the Collateral Trust Agreement.

 

(h)           The Company agrees that, upon the request to the
Administrative Agent by any Lender, the Company will promptly execute and
deliver to such Lender a promissory note of the Company evidencing the Term
Loans of such Lender, substantially in the form of Exhibit M, (a “Term
Note”), with appropriate insertions as to date and principal amount.

 

2.12.        Requirements
of Law.  Except with respect to
Taxes, which shall be governed exclusively by Section 2.13 of this
Agreement:

 

(a)           If the adoption of
or any change in any Requirement of Law or in the interpretation or application
thereof or compliance by any Lender with any request or directive (whether or
not having the force of law) from any central bank or other Governmental
Authority , in each case, made subsequent to the date hereof:

 

(i)            shall impose,
modify or hold applicable any reserve, special deposit, compulsory loan or similar
requirement against assets held by, deposits or other liabilities in or for the
account of, advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender that is not otherwise
included in the determination of the Eurodollar Rate; or

 

(ii)           shall impose on
such Lender any other condition;

 

and the result of any of the foregoing is to
increase the cost to such Lender, by an amount that such Lender deems material,
of making, converting into, continuing or maintaining Eurodollar Loans, or to
reduce any amount receivable hereunder in respect thereof, then, in any such
case, the Company shall pay such Lender, within 15 Business Days of receipt of
notice from the relevant Lender as described below, any additional amounts
necessary to compensate such Lender for such increased cost or reduced amount
receivable.  If any Lender becomes
entitled to claim any additional amounts pursuant to this paragraph, it shall
promptly notify the Company (with a copy to the Administrative Agent) of the
event by reason of which it has become so entitled (including a reasonably
detailed calculation of such amounts).

 

(b)           If any Lender shall
have determined that the adoption of or any change in any Requirement of Law
regarding capital adequacy or in the interpretation or application thereof or
compliance by such Lender or any corporation controlling such Lender with any
request or directive regarding capital adequacy (whether or not having the
force of law) from any Governmental Authority made subsequent to the date hereof
shall have the effect of reducing the rate of return on such Lender’s or such
corporation’s capital as a consequence of its obligations hereunder to a level
below that which such Lender or such corporation could have achieved but for
such adoption, change or compliance (taking into consideration such Lender’s or
such corporation’s policies with respect to capital adequacy) by an amount
deemed by such Lender to

 

36

 

be
material, then from time to time, within 15 Business Days after submission by
such Lender to the Company (with a copy to the Administrative Agent) of a
written request therefor (together with a reasonably detailed description and
calculation of such amounts), the Company shall pay to such Lender such
additional amount or amounts as will compensate such Lender or such corporation
for such reduction.

 

(c)           A certificate
setting forth in reasonable detail amounts payable pursuant to this Section submitted
by any Lender to the Company (with a copy to the Administrative Agent) shall be
conclusive in the absence of manifest error. 
Notwithstanding anything to the contrary in this Section, the Company
shall not be required to compensate a Lender pursuant to this Section for
any amounts incurred more than six months prior to the date that such Lender
notifies the Company of such Lender’s intention to claim compensation therefor;
provided that, if the circumstances giving rise to such claim have a
retroactive effect, then such six-month period shall be extended to include the
period of such retroactive effect.  The
obligations of the Company pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.

 

2.13.        Taxes.  (a)  All payments made by the Company
under this Agreement shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding (a) net income taxes and franchise taxes
(imposed in lieu of net income taxes) imposed on the Administrative Agent or
any Lender as a result of a present or former connection between the
Administrative Agent or such Lender and the jurisdiction of the Governmental
Authority imposing such tax or any political subdivision or taxing authority
thereof or therein (other than any such connection arising solely from the
Administrative Agent or such Lender having executed, delivered or performed its
obligations or received a payment under, or enforced, this Agreement or any
other Loan Document) and (b) any branch profit taxes imposed by the United
States or any similar tax imposed by any other Governmental Authority.  If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings (“Non-Excluded
Taxes”) or Other Taxes are required to be withheld from any amounts payable
to the Administrative Agent or any Lender hereunder, (i) the Company shall
make such deductions and shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable laws and (ii) the amounts
so payable to the Administrative Agent or such Lender hereunder shall be
increased to the extent necessary to yield to the Administrative Agent or such
Lender (after payment of all Non-Excluded Taxes and Other Taxes) interest or
any such other amounts payable hereunder at the rates or in the amounts
specified in this Agreement, provided, however, that the Company
shall not be required to increase any such amounts payable to the
Administrative Agent or any Lender with respect to any Non-Excluded Taxes
except to the extent that any change in applicable law, treaty or governmental
rule, regulation or governmental authorization after the time such Lender
(including any new or successor Administrative Agent) becomes a party to this
Agreement (“Change in Tax Law”), shall result in an increase in the rate
of any deduction, withholding or payment from that in effect at the time such
Lender becomes a party to this Agreement, in respect of payments to such Lender
hereunder, but only to the extent of such increase.  Notwithstanding anything to the contrary
herein, the Company shall not be required to increase any amounts payable to
the Administrative Agent or any Lender with respect to any Non-Excluded Taxes
that are attributable to such Person’s (i) failure to comply with the
requirements of paragraph (d) of this Section 2.13 except as such
failure relates to a Change in Tax Law rendering such Person legally unable to
comply or (ii) bad faith, willful misconduct or gross negligence.

 

(b)           In addition, the Company shall pay any Other Taxes over to
the relevant Governmental Authority in accordance with applicable law.

 

37

 

(c)           Whenever any Non-Excluded Taxes or Other Taxes are payable
by the Company, as promptly as possible thereafter the Company shall send to
the Administrative Agent for its own account or for the account of the relevant
Lender, as the case may be, a certified copy of an original official receipt
received by the Company showing payment thereof.  If the Company fails to pay any Non-Excluded
Taxes or Other Taxes when due to the appropriate taxing authority or fails to
remit to the Administrative Agent the required receipts or other required
documentary evidence, the Company shall indemnify the Administrative Agent and
the Lenders for any incremental taxes, Non-Excluded Taxes or Other Taxes,
interest, additions to tax, expenses or penalties that may become payable by
the Administrative Agent or any Lender as a result of any such failure; provided,
however, no such indemnification obligation shall arise if the failure
to pay any Non-Excluded Taxes or Other Taxes when due arose solely from or was
caused solely by, directly or indirectly, any breach of any representation or
covenant in this Agreement by, or bad faith, willful misconduct or gross
negligence of, the applicable Lender or the Administrative Agent.  The indemnification payment under this Section 2.13(c) shall
be made within 30 days after the date the Administrative Agent or such Lender
(as the case may be) makes a written demand therefor (together with a
reasonably detailed calculation of such amounts).

 

(d)           Each Lender (or Transferee) (i) that is not a “U.S.
Person” as defined in Section 7701(a)(30) of the Code (a “Non-U.S.
Lender”) shall deliver to the Company and the Administrative Agent two
copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI,
or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal
withholding tax under Section 871(h) or 881(c) of the Code with
respect to payments of “portfolio interest”, a statement substantially in the
form of Exhibit L and a Form W-8BEN, Form W-8IMY (with
applicable attachments), or any subsequent versions thereof or successors
thereto, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from U.S. federal withholding tax on all payments by the
Company under this Agreement and the other Loan Documents and (ii) that is
a “U.S. Person” as defined in Section 7701(a)(30) of the Code shall deliver
to the Company and the Administrative Agent (or in the case of a Participant,
to the Lender from which the related participation shall have been purchased)
two properly completed and duly executed copies of U.S. Internal Revenue
Service Form W-9 certifying that such Lender is on the date of delivery
thereof entitled to an exemption from United States backup withholding
tax.  Such forms shall be delivered by
each Lender on or before the date it becomes a party to this Agreement (or, in
the case of any Participant, on or before the date such Participant purchases
the related participation).  Thereafter,
each Lender shall, to the extent it is legally able to do so, deliver such
forms promptly upon the obsolescence or invalidity of any form previously
delivered by such Lender at any other time prescribed by applicable law or as
reasonably requested by the Company.  In
the event of a Change in Tax Law, each Lender shall deliver all such forms that
it is legally able to deliver, including any form claiming a reduced rate of
U.S. federal withholding tax on payments by the Company under this Agreement
and any other Loan Document.  Each
Non-U.S. Lender shall promptly notify the Company at any time it determines
that it is no longer in a position to provide any previously delivered
certificate to the Company (and any other form of certification adopted by the
U.S. taxing authorities for such purpose).

 

(e)           If the Administrative
Agent, any Transferee or any Lender determines, in its sole good faith
discretion, that it has received a refund of any Non-Excluded Taxes or Other
Taxes as to which it has been indemnified by the Company or with respect to
which the Company has paid additional amounts pursuant to this Section 2.13,
it shall pay over such refund to the Company (but only to the extent of
indemnity payments made, or additional amounts paid, by the Company under this Section 2.13
with respect to the Non-Excluded Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of the Administrative Agent, such
Transferee or such Lender and without interest (other than any interest paid by
the relevant Governmental Authority with respect to such refund); provided,
that the Company, upon the request of the Administrative Agent, such Transferee
or such Lender, agrees to repay the amount paid over to the Company (plus any
penalties, interest or other charges imposed by the

 

38

 

relevant Governmental
Authority) to the Administrative Agent, such Transferee or such Lender in the
event the Administrative Agent, such Transferee or such Lender is required to
repay such refund to such Governmental Authority. This paragraph shall not be
construed to (i) interfere
with the right of the Administrative Agent, any Transferee or any Lender to
arrange its tax affairs in whatever manner it sees fit, (ii) obligate the
Administrative Agent, any Transferee or any Lender to claim any tax refund, (iii) require the Administrative Agent, any Transferee
or any Lender to make available its tax returns (or any other information
relating to its taxes or any computation in respect thereof which it deems in
its sole discretion to be confidential) to the Company, or any other Person,
or (iv) require the Administrative Agent, any Transferee or any Lender to
do anything that would in its sole discretion prejudice its ability to benefit
from any other refunds, credits, reliefs, remissions or repayments to which it
may be entitled.

 

(f)            Each Assignee shall be bound by this Section 2.13.

 

(g)           The agreements in this Section shall survive the
termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.

 

2.14.        Indemnity.  The
Company agrees to indemnify each Lender for, and to hold each Lender harmless
from, any actual loss, cost or expense that such Lender may sustain or incur as
a consequence of (a) default by the Company in making a borrowing of,
conversion into or continuation of Eurodollar Loans after the Company has given
a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Company in making any prepayment of or
conversion from Eurodollar Loans after the Company has given a notice thereof
in accordance with the provisions of this Agreement, (c) the making of a
prepayment of Eurodollar Loans (or the conversion of a Eurodollar Loan into a
Loan of a different Type) on a day that is not the last day of an Interest
Period with respect thereto or (d) the assignment of any Eurodollar Loan
other than on the last day of an Interest Period therefor as a result of a
request by the Company pursuant to Section 2.16.  Such indemnification may include an amount up
to the excess, if any, of (i) the amount of interest that would have
accrued on the amount so prepaid, or not so borrowed, converted or continued,
for the period from the date of such prepayment or of such failure to borrow,
convert or continue to the last day of such Interest Period (or, in the case of
a failure to borrow, convert or continue, the Interest Period that would have
commenced on the date of such failure) in each case at the applicable rate of
interest for such Loans provided for herein (excluding, however, the Applicable
Margin included therein, if any) over (ii) the amount of interest
(as reasonably determined by such Lender) that would have accrued to such
Lender on such amount by placing such amount on deposit for a comparable period
with leading banks in the interbank eurocurrency market.  A certificate as to any amounts payable
pursuant to this Section submitted to the Company by any Lender (together
with a reasonably detailed calculation of such amounts) shall be conclusive in
the absence of manifest error and shall be payable within 30 days of receipt of
any such notice.  The agreements in this Section 2.14
shall survive the termination of this Agreement and the payment of the Loans
hereunder.

 

2.15.        Change of Applicable Lending Office.  Each Lender agrees that, upon the occurrence
of any event giving rise to the operation of Section 2.12 or 2.13(a) with
respect to such Lender, it will, if requested by the Company, use reasonable
efforts to file any certificate or document, as applicable (subject to overall
policy considerations of such Lender) to designate another Applicable Lending
Office for any Loans affected by such event with the object of avoiding or
minimizing the consequences of such event; provided, that such
designation is made on terms that, in the reasonable judgment of such Lender,
do not cause such Lender and its lending office(s) to suffer any material
economic, legal or regulatory disadvantage; and provided, further,
that nothing in this Section shall affect or postpone any of the
obligations of the Company or the rights of any Lender pursuant to Section 2.12
or 2.13(a).

 

39

 

2.16.        Replacement/Termination of Lenders.  The Company shall be permitted to replace
with a replacement financial institution or terminate the Commitments and repay
any outstanding Loans of any Lender that (a) requests reimbursement for
amounts owing pursuant to Section 2.12 or 2.13(a), (b) defaults in
its obligation to make Loans hereunder or (c) fails to give its consent
for any amendment or waiver requiring the consent of 100% of the Lenders or all
affected Lenders (and such Lender is an affected Lender) and for which Lenders
holding at least a majority of the Loans and/or Commitments required for such
vote have consented; provided that (i) no Event of Default shall
have occurred and be continuing at the time of such replacement, (ii) the
replacement financial institution or the Company, as applicable, shall purchase
or repay, at par plus accrued interest and accrued fees thereon, all Loans
owing to such replaced or terminated Lender on or prior to the date of
replacement or termination and shall consent to the relevant amendment or
waiver, as applicable, (iii) the Company shall be liable to such replaced
or terminated Lender under Section 2.14 if any Eurodollar Loan owing to
such replaced Lender shall be purchased or repaid other than on the last day of
the Interest Period relating thereto, (iv) any replacement financial
institution, if not a Lender, shall be reasonably satisfactory to the
Administrative Agent, (v) any replaced Lender shall be obligated to make
such replacement in accordance with the provisions of Section 9.6 (provided
that the Company shall be obligated to pay the registration and processing fee
referred to therein), (vi) until such time as such replacement shall be
consummated, the Company shall pay all additional amounts (if any) required
pursuant to Section 2.12 or 2.13(a), as the case may be, and (vii) any
such replacement, termination and/or repayment shall not be deemed to be a
waiver of any rights that the Company, the Administrative Agent or any other
Lender shall have against the replaced Lender.

 

SECTION 3            REPRESENTATIONS
AND WARRANTIES

 

To induce the Lenders to enter into this Agreement
and to make the Loans and make other extensions of credit hereunder Holdings
and the Company hereby jointly represent and warrant to each Lender that:

 

3.1.          Financial Condition.            (a)           The
unaudited pro  forma combined balance sheet of the Company and its
Subsidiaries as at March 31, 2007 (the “Pro Forma Balance Sheet”),
copies of which have heretofore been furnished to each Lender, has been
prepared giving effect (as if such events had occurred on such date) to (i) the
consummation of the Acquisition, (ii) the Loans to be made on the Closing
Date and the use of proceeds thereof, (iii) other adjustments to reflect
the effects of the Acquisition and (iv) the payment of fees and expenses
in connection with the foregoing.  The
Pro Forma Balance Sheet has been prepared based on the best information
reasonably available to the Company as of the date of delivery thereof, and presents
fairly in all material respects, on a pro  forma basis the
estimated financial position of Company and its Subsidiaries as at March 31,
2007, assuming that the events specified above had actually occurred at such
date, but without including any effects of purchase accounting and it being
understood that such balance sheet does not comply with Regulation S-X and not
assuming any balance sheet composition changes between March 31, 2007 and
the Closing Date.

 

(b)           The audited combined balance sheets of Chrysler Automotive
as at December 31, 2005 and December 31, 2006, and the related
audited combined statements of operations and comprehensive income, parent
company equity/deficit and of cash flows for the fiscal years ended on such
dates and on December 31, 2004, reported on by and accompanied by an
unqualified report from KPMG LLP, present fairly, in all material respects, the
financial position, results of operations and cash flows applicable to Chrysler
Automotive for the dates and periods covered thereby as at such date, and the
combined results of its operations and its combined cash flows for the
respective fiscal years then ended, in each case in conformity with GAAP.  The unaudited combined balance sheet of Chrysler
Automotive as at March 31, 2007, and the related unaudited combined
statements of operations and comprehensive income, parent company
equity/deficit and cash flows for the three-month period ended on such date,

 

40

 

present fairly, in all material
respects, the combined financial position, results of operations and cash flows
applicable to Chrysler Automotive as at such date, and for the three-month
period then ended.  All such financial
statements, including the related schedules and notes thereto, have been
prepared in accordance with GAAP (subject, in the case of the unaudited
combined balance sheet of Chrysler Automotive as at March 31, 2007, and
the related unaudited combined statements of operations and comprehensive
income, parent company equity/deficit and cash flows for the three-month period
ended on such date, to the absence of footnote disclosures and changes of the
type that are normal year-end adjustments the effect of which adjustments are
not expected by the Company to be material individually or in the aggregate)
applied consistently throughout the periods involved (except as approved by the
aforementioned firm of accountants and disclosed therein).  No Group Member has any material Guarantee
Obligations, contingent liabilities and liabilities for taxes, or any long-term
leases or unusual forward or long-term commitments, including any interest rate
or foreign currency swap or exchange transaction or other obligation in respect
of derivatives, that are not reflected in the most recent financial statements
and footnotes referred to in this paragraph. 
During the period from March 31, 2007 to and including the Closing
Date there has been no Disposition by any Group Member of any material part of
its business or property other than transactions required by the terms of the
Acquisition Agreement. For the purposes of this clause (b), the term “Chrysler
Automotive” shall mean the business conducted by the Chrysler manufacturing and
wholesale distribution group of DaimlerChrysler AG, which was not separately
organized under an existing legal structure in the past, combined on a basis as
if the assets, liabilities and results of operations of the group were
combined, as further defined in Note 1 of the related financial statements
described in Section 3.1(b).

 

3.2.          No Change. 
After the Closing Date there has been no development or event which has
had a Material Adverse Effect.

 

3.3.          Existence. 
Each Group Member (a) is duly organized, validly existing and (to
the extent applicable in such jurisdiction) in good standing under the laws of
the jurisdiction of its organization, (b) has the power and authority, and
the legal right, to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is currently
engaged, (c) is duly qualified as a foreign corporation or other
organization and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification and (d) is in compliance with all Requirements
of Law except, in each case of the foregoing clauses (a), (b), (c) or (d),
to the extent that the failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

3.4.          Power; Authorization; Enforceable Obligations.  Each Loan Party has the power and authority,
and the legal right, to execute, deliver and perform the Loan Documents to
which it is a party and, in the case of the Company, to obtain extensions of
credit hereunder.  Each Loan Party has
taken all necessary organizational action to authorize the execution, delivery
and performance of the Loan Documents to which it is a party and, in the case
of the Company, to authorize the extensions of credit on the terms and
conditions of this Agreement.  No consent
or authorization of, filing with, notice to or other act by or in respect of,
any Governmental Authority or any other Person is required in connection with
the extensions of credit hereunder or with the execution, delivery,
performance, validity or enforceability of this Agreement or any of the Loan
Documents, except (i) consents, authorizations, filings and notices
described in Schedule 3.4, which consents, authorizations, filings and notices
have been obtained or made and are in full force and effect and (ii) the
filings referred to in Section 3.14. The execution, delivery and
performance of the Acquisition Documentation do not and will not require any
consent, approval, authorization or other order of, action by, filing with, or
notification to, any Governmental Authority, except (a) as described or
required to be described in Section 3.04 or Section 3.05 of the DC
Contributors Disclosure (as defined in the Acquisition Agreement) and other
immaterial consents, approvals, authorizations, filings and notices that have
been obtained or made and which are in full force and effect,

 

41

 

(b) the premerger notification and
waiting period requirements of the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended, and the rules and regulations promulgated thereunder,
(c) the requirements of Antitrust Laws (as defined in the Acquisition
Agreement) of any other relevant jurisdiction, except where the failure to
obtain such consent, approval, authorization or action, or to make such filing
or notification, would not prevent or materially delay the consummation of the
Acquisition and would not have a Company Material Adverse Effect (as defined in
the Acquisition Agreement), or (d) as may be necessary as a result of any
facts or circumstances relating solely to the Investor or any of its
Affiliates. Each Loan Document has been duly executed and delivered on behalf
of each Loan Party thereto.  This
Agreement constitutes, and each other Loan Document upon execution will
constitute, a legal, valid and binding obligation of each Loan Party party
thereto, enforceable against each such Loan Party in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

 

3.5.          No Legal Bar. 
The execution, delivery and performance of this Agreement and the other
Loan Documents, the borrowings hereunder and the use of the proceeds thereof
will not violate any Requirement of Law or any Contractual Obligation of any
Loan Party, and will not result in, or require, the creation or imposition of
any Lien on any of their respective properties or revenues pursuant to any
Requirement of Law or any such Contractual Obligation (other than the Liens
created by the Security Documents). No Requirement of Law or Contractual
Obligation applicable to the Company or any of its Subsidiaries could
reasonably be expected to have a Material Adverse Effect.

 

3.6.          Litigation. 
No litigation or proceeding of or before any arbitrator or Governmental
Authority is pending or, to the knowledge of Holdings or the Company,
threatened by or against any Group Member or against any of their respective
properties or revenues (a) with respect to any of the Loan Documents or
any of the transactions contemplated hereby or thereby, or (b) that could
reasonably be expected to have a Material Adverse Effect.

 

3.7.          No Default. 
No Group Member is in default under or with respect to any of its
Contractual Obligations except where such default could not reasonably be
expected to have a Material Adverse Effect. 
No Default or Event of Default has occurred and is continuing.

 

3.8.          Ownership of Property.  As of the Closing Date, the Company and each
Initial Subsidiary Guarantor, as applicable, has title in fee simple to in the
Mortgaged Property and has good title to or is lessee of all of its other property
material to the operation of their respective businesses and none of such
property is subject to any Lien except Permitted Liens; provided, that
the foregoing representation shall not be deemed to have been incorrect, if (i) the
property with respect to which the Company or an Initial Subsidiary Guarantor
cannot make such representation has a Net Book Value of less than $250,000,000
or (ii) with respect to defects in title to any real property, such
defects are cured no later than 180 days after the Closing Date or such defects
could not reasonably be expected to detract from the current use or operation
of the affected real property in any material respect.  In addition, to the extent that any defect in
title to any Mortgaged Property is insured against in any title insurance
policy for the benefit of the Collateral Trustee, such defect shall not be
taken into account for purposes of the preceding sentence up to the amount of
such insurance coverage.

 

3.9.          Intellectual Property.  Each Group Member owns, or is licensed to
use, all Intellectual Property necessary for the conduct of its business as
currently conducted or contemplated to be conducted except where failure to own
or be licensed could not reasonably be expected to have a Material Adverse
Effect.  No material claim has been
asserted and is pending by any Person challenging or questioning the use of any
Intellectual Property or the validity or effectiveness of any Intellectual

 

42

 

Property, nor does Holdings or the Company
know of any valid basis for any such claim. 
To the knowledge of any Group Member the use of Intellectual Property by
each Group Member does not infringe on the rights of any Person in any material
respect.

 

3.10.        Federal Regulations. 
No part of the proceeds of any Loans, and no other extensions of credit
hereunder, will be used for any purpose that violates the provisions of
Regulation T, U or X of the Board.

 

3.11.        ERISA.  (i)  Except as, in the aggregate, would
not reasonably be expected to have a Material Adverse Effect, (a) during
the five year period prior to the initial date on which this representation is
made or deemed made with respect to any Plan and (b) as of each subsequent
date on which this representation is made or deemed made with respect to any
Plan, none of the following have occurred or then exists: (I) a Reportable
Event; (II) an “accumulated funding deficiency” (within the meaning of Section 412
of the Code or Section 302 of ERISA), and, on and after the effectiveness
of the Pension Act, any failure by any Plan to satisfy the minimum funding
standards (within the meaning of Section 412 of the Code or Section 302
of ERISA), whether or not waived; (III) the filing pursuant to Section 412
of the Code or Section 303 of ERISA of an application for a waiver of the
minimum funding standard with respect to any Plan; (IV) 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; (V) the incurrence by the Company or
any Commonly Controlled Entity of any liability under Title IV of ERISA with
respect to the termination of any Plan, including but not limited to the
imposition of any Lien in favor of the PBGC or any Plan; (VI) on and after
the effectiveness of the Pension Act, a determination that any Plan is, or is
expected to be, in “at risk” status (within the meaning of Title IV of ERISA); (VII) the
receipt by the Company or any Commonly Controlled Entity from the PBGC or a
plan administrator of any notice relating to an intention to terminate any Plan
or to appoint a trustee to administer any Plan under Section 4042 of
ERISA; (VIII) the incurrence by the Company or any Commonly Controlled
Entity of any liability with respect to the withdrawal or partial withdrawal
from any Plan or Multiemployer Plan; or (IX) the receipt by the Company or
any Commonly Controlled Entity of any notice, or the receipt by any
Multiemployer Plan from the Company or any Commonly Controlled Entity of any
notice, concerning the imposition of Withdrawal Liability or a determination
that a Multiemployer Plan is, or is reasonably expected to be, in Insolvency or
in Reorganization or, on and after the effectiveness of the Pension Act, is or
is reasonably expected to be in endangered or critical status, within the
meaning of Section 432 of the Code or Section 305 or Title IV of
ERISA, or has been or is reasonably expected to be terminated within the
meaning of Title IV of ERISA; (c) each of the Company and any Commonly
Controlled Entity is in compliance with the applicable provisions of ERISA and the Code and the regulations and
published interpretations; (d) the present value of all accrued benefits
under each Plan of the Company and any Commonly Controlled Entity (based on
those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits and the present value of all accrued benefit obligations of all
underfunded Plans (based on the assumptions used for purposes of Statement of
Financial Accounting Standards No. 87) does not exceed the value of the
assets of all such underfunded Plan; and (e) all amounts required by
applicable law with respect to, or by the terms of, any retiree welfare benefit
arrangement have been accrued in accordance with Statement of Financial
Accounting Standards No. 106.

 

(ii) Except as, in the
aggregate, would not reasonably be expected to have a Material Adverse Effect, (a) all
employer and employee contributions required by applicable law or by the terms
of any Foreign Benefit Arrangement or Foreign Plan have been made, or, if
applicable, accrued in accordance with normal accounting practices; (b) the
accrued benefit obligations of each Foreign Plan (based on those assumptions
used to fund such Foreign Plan) with respect to all current and former
participants do not exceed the assets of such Foreign Plan; (c) each
Foreign Plan that is required to be

 

43

 

registered has been registered and has been
maintained in good standing with applicable regulatory authorities; and (d) each
such Foreign Benefit Arrangement and Foreign Plan is in compliance (I) with
all material applicable provisions of law and all material applicable
regulations and published interpretations thereunder with respect to such
Foreign Plan or Foreign Benefit Arrangement and (II) with the terms of
such plan or arrangement.

 

3.12.        Investment
Company Act.  No Loan Party is
required to register as an “investment company”, or is a company “controlled”
by a Person that is required to register as an “investment company”, within the
meaning of the Investment Company Act of 1940, as amended.

 

3.13.        Subsidiaries;
Pledged Equity; Joint Ventures. 
Except as disclosed to the Administrative Agent by the Company in
writing from time to time after the Closing Date, (a) Schedule 3.13(a) sets
forth the name and jurisdiction of incorporation or formation of each Initial
Subsidiary Guarantor, each other Domestic Subsidiary (to the extent that
interests in its Capital Stock are to be pledged), and each first tier CFC
whose Capital Stock is owned by a Loan Party and, as to each such Subsidiary,
the percentage of each class of Capital Stock owned by any Loan Party and the
percentage thereof pledged pursuant to the Security Documents; (b) there
are no outstanding subscriptions, options, warrants, calls, rights or other
agreements or commitments (other than stock options granted to employees or
directors and directors’ qualifying shares) of any nature relating to any
Capital Stock of the Company or any Subsidiary or any first tier CFC whose
Capital Stock is owned by a Loan Party, except (i) as created by the Loan
Documents and (ii) with respect to any JV Subsidiary; and (c) Schedule
3.13(c) sets forth the name and jurisdiction of incorporation or formation
of (i) each joint venture to which the Company or a Subsidiary is a party
and in which the Net Book Value of the Investment of the Company or any of its
Subsidiaries is greater than $250,000,000, (ii) each JV Subsidiary and (iii) each
other Subsidiary of the Company that is not otherwise identified in Schedule
3.13(a).

 

3.14.        Security
Documents.  (a)  Upon execution
and delivery thereof by the parties thereto, the Security Agreement and each
Mortgage will be effective under applicable law to create in favor of the
Collateral Trustee, for the benefit of the Secured Parties, a legal, valid and
enforceable security interest in the Collateral described therein; provided
that the foregoing representation shall not be deemed to have been incorrect if
(i) such Security Documents are not effective with respect to Collateral
having an aggregate Net Book Value of less than $250,000,000, (ii) with
respect to any Mortgaged Property, such failure is cured no later than 180 days
from the Closing Date or (iii) at any time after the Closing Date, the
Borrowing Base Coverage Ratio is at least 1.25 to 1.00 (calculated on a pro
forma basis assuming such Collateral for which the Security Documents
are not so effective is excluded from the Borrowing Base).

 

(b)           As of the Closing Date, the UCC financing statements
listed in Schedule 4.1(h), and the recordation of the Mortgages in the
recording offices listed in Schedule 1.1E under the heading “Closing Date
Mortgages”, are all the filings, recordings and registrations (other than
filings required to be made in the United States Patent and Trademark Office
and the United States Copyright Office) that are necessary to perfect a
security interest in favor of the Collateral Trustee (for the benefit of the
Secured Parties) in respect of all Collateral in which the Lien granted
pursuant to the Security Documents on the Closing Date may be perfected by
filing, recording or registering in the United States (or any political
subdivision thereof) and its territories and possessions, and no further or
subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary in any such jurisdiction, except as provided under
applicable law with respect to the filing of continuation statements; provided
that the foregoing representation shall not be deemed to have been incorrect to
the extent any security interest is not perfected with respect to Collateral
having an aggregate Net Book Value of less than $250,000,000.

 

44

 

3.15.        Environmental
Laws.    Except as, in the aggregate,
could not reasonably be expected to have a Material Adverse Effect:

 

(i)            to the knowledge of
Holdings and the Company the facilities and properties owned, leased or
operated by any Group Member (the “Properties”) do not contain, and have not
previously contained, any Materials of Environmental Concern in amounts or
concentrations or under circumstances that constitute or constituted a
violation of, or could give rise to liability under, any Environmental Law;

 

(ii)           no Group Member has
received or is aware of any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental
matters or compliance with Environmental Laws with regard to any of the
Properties or the business operated by any Group Member (the “Business”), nor
does Holdings or the Company have knowledge or reason to believe that any such
notice will be received or is being threatened;

 

(iii)          No Materials of
Environmental Concern have been generated, treated, stored or disposed of at,
on or under any of the Properties in violation of, or in a manner that could
give rise to liability under, any applicable Environmental Law, nor, to the
knowledge of the Company have Materials of Environmental Concern been
transported or disposed of from the Properties in violation of, or in a manner
or to a location that could give rise to liability under, any Environmental Law;

 

(iv)          no judicial
proceeding or governmental or administrative action is pending or, to the
knowledge of Holdings and the Company, threatened in writing, under any
Environmental Law to which any Group Member is or will be named as a party with
respect to the Properties or the Business, nor are there any consent decrees or
other decrees, consent orders, administrative orders or other written orders,
or other written administrative or judicial requirements outstanding under any
Environmental Law with respect to the Properties or the Business;

 

(v)           there has been no
release or threat of release of Materials of Environmental Concern at or from
the Properties, or arising from or related to the operations of any Group
Member in connection with the Properties or otherwise in connection with the
Business, in violation of or in amounts or in a manner that could give rise to
liability under Environmental Laws;

 

(vi)          to the knowledge of
Holdings and the Company, the Properties and all operations at the Properties
are in compliance, and have in the last five years been in compliance, with all
applicable Environmental Laws, and there is no contamination at, under or about
the Properties or violation of any Environmental Law with respect to the
Properties or the Business; and

 

(vii)         no Group Member has
assumed any liability of any other Person under Environmental Laws.

 

3.16.        Accuracy
of Information, etc.  No statement or
information contained in this Agreement, any other Loan Document, the
Confidential Information Memorandum or any other document, certificate or
statement, taken as a whole, furnished by or on behalf of any Loan Party to the
Administrative Agent or the Lenders, or any of them, for use in connection with
the transactions contemplated by this Agreement or the other Loan Documents,
contained as of the date such statement, information, document or certificate
was so furnished (or, in the case of the Confidential Information

 

45

 

Memorandum, together with
all other information provided to the Administrative Agent or the Lenders, as
of the date of this Agreement), any untrue statement of a material fact or
omitted to state a material fact necessary to make the statements contained
herein or therein not materially misleading. 
The projections and pro  forma financial information
contained in the materials referenced above are based upon good faith estimates
and assumptions believed by management of the Company to be reasonable at the
time made, it being recognized by the Lenders that such financial information
as it relates to future events is not to be viewed as fact and that actual
results during the period or periods covered by such financial information may
differ from the projected results set forth therein by a material amount.

 

3.17.        Taxes.  Except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect, each Group Member has
filed or caused to be filed all Federal, state and other material tax returns
that are required to be filed and has paid all taxes shown to be due and
payable on said returns or on any assessments made against it or any of its
property and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Authority (other than any the amount or validity
of which are currently being contested in good faith by appropriate proceedings
and with respect to which reserves in conformity with GAAP have been provided
on the books of the relevant Group Member); no tax Lien (other than a Permitted
Lien) has been filed, and, to the knowledge of Holdings and the Company, no
claim is being asserted, with respect to any such tax, fee or other charge.

 

3.18.        Solvency.  The Loan Parties are, on a consolidated
basis, after giving effect to the Acquisition and the incurrence of all
Indebtedness and obligations being incurred in connection herewith and
therewith will be and will continue to be, Solvent.

 

3.19.        Regulation
H.  No Mortgage encumbers improved
real property 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 and in which flood insurance has been made available under the National
Flood Insurance Act of 1968.

 

3.20.        Certain
Documents.  The Company has delivered
to the Administrative Agent a complete and correct copy of the Acquisition
Documentation, including any amendments, supplements or modifications with
respect to any of the foregoing.

 

3.21.        Use
of Proceeds.  The proceeds of the
Term Loans shall be used for general corporate purposes.

 

SECTION 4    CONDITIONS
PRECEDENT

 

This Agreement and the obligation of each Lender to
make the Loans and other extensions of credit requested to be made by it
hereunder shall be effective upon the Administrative Agent having confirmed
that the following conditions have been satisfied (or waived) as of the Closing
Date:

 

(a)           Credit Agreement;
Security Documents.  The
Administrative Agent or the Collateral Trustee, as applicable, shall have
received:

 

(i)            this Agreement (or,
in the case of any relevant Lender, an Addendum) executed and delivered by the
Administrative Agent, the Company, Holdings, and each Person listed on Schedule
1.1A;

 

(ii)           the Security
Agreement, executed and delivered by Holdings, the Company and each Initial Subsidiary
Guarantor;

 

46

 

(iii)          the Guarantee,
executed and delivered by Holdings and each Initial Subsidiary Guarantor;

 

(iv)          the Trademark
Security Agreement, the Patent Security Agreement and the Copyright Security
Agreement, each executed and delivered by the Company, each Initial Subsidiary
Guarantor (if applicable) and the Collateral Trustee;

 

(v)           a Mortgage with
respect to each property listed on Schedule 1.1E under the heading “Closing
Date Mortgages”, executed and delivered by the owner of the Mortgaged Property
covered thereby; and

 

(vi)          the Collateral Trust
Agreement, executed and delivered by the Collateral Trustee, Holdings, the
Administrative Agent (hereunder and under the First Lien Credit Agreement), the
Company and each Initial Subsidiary Guarantor.

 

(b)           Acquisition.
The Company shall have delivered to the Administrative Agent a complete and
correct copy of the Acquisition Documentation (including any amendments,
supplements, or modifications with respect to any of the foregoing), and the
following transactions shall have been consummated:

 

(i)            the transactions
contemplated by the Acquisition Agreement (the “Acquisition”). No
provision of the Acquisition Documentation shall have been waived, amended,
supplemented or otherwise modified in any respect materially adverse to the
Lenders;

 

(ii)           at least
$5,000,000,000 from (i) the proceeds of equity issued to the Sponsor and
other investors satisfactory to the Lenders, shall have been contributed to the
Company, (ii) repayment of intercompany receivables by FinCo, and (iii) the
proceeds of the sale of Auburn Hills Property; and

 

(iii)          The Administrative
Agent shall have received satisfactory evidence that all Indebtedness listed on
Schedule 4.1(b)(iii) shall have been terminated and all amounts thereunder
shall have been paid in full and satisfactory arrangements shall have been made
for the termination of all Liens granted in connection therewith.

 

(c)           Lien Searches.  The Administrative Agent shall have received
the results of a recent lien search in respect of the Company and each other
Loan Party, from the jurisdiction in which such Loan Party is located for
purposes of the UCC of the relevant state(s).

 

(d)           Fees.  The Lenders, the Administrative Agent, the
Lead Arrangers and the Bookrunners shall have received all fees required to be
paid, and all expenses for which invoices have been presented (including the
reasonable fees and expenses of legal counsel) in connection with this
Agreement, on or before the Closing Date. 
All such amounts will be paid with proceeds of Loans made on the Closing
Date and will be reflected in the funding instructions given by the Company to
the Administrative Agent on or before the Closing Date.

 

(e)           Closing
Certificate; Certified Certificate of Incorporation; Good Standing Certificates.  The Administrative Agent shall have received (i) a
certificate of each Loan Party, dated the Closing Date, substantially in the
form of Exhibit G, with appropriate insertions and attachments, including
the certificate of incorporation (or equivalent organizational document) of
each Loan Party, certified by the relevant authority of the jurisdiction of
organization of such Loan Party, (ii) a long form good standing
certificate for each Loan Party from its jurisdiction of

 

47

 

organization
and (iii) a certificate of the Company, dated the Closing Date, to the
effect that the conditions set forth in Section 4.1 have been satisfied.

 

(f)            Legal Opinions.  The Administrative Agent shall have received
the executed legal opinion of (i) Schulte Roth & Zabel LLP, New
York counsel to the Company and its Subsidiaries, substantially in the form of Exhibit I-1,
as to New York law, United States federal law and the Delaware Limited
Liability Companies Act and (ii) in-house counsel to the Company and its
Subsidiaries, substantially in the form of Exhibit I-2.

 

(g)           Pledged Stock;
Stock Powers; Pledged Notes.  The
Collateral Trustee shall have received (i) the certificates representing
the shares of Capital Stock described on Schedule 3.13(a) (in each case,
to the extent such Capital Stock is certificated and constitutes a “certificated
security” under the UCC), together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the pledgor
thereof and (ii) each promissory note described on Schedule 4.1(g),
together with an undated endorsement for each such promissory note executed in
blank by a duly authorized officer of the pledgor thereof.

 

(h)           Filings,
Registrations and Recordings.  The
Collateral Trustee shall have received (i) each Uniform Commercial Code
financing statement listed on Schedule 4.1(h) in proper form for filing
and (ii) the Mortgages for recording in the recording offices listed in
Schedule 1.1E under the heading “Closing Date Mortgages”.

 

(i)            Finance
Facilities.  The FinCo Facilities
shall close and fund simultaneously with the confirmation of the satisfaction
or waiver of the conditions under this Section 4 and the declaration that
the Closing Date shall have occurred.

 

(j)            First Lien
Credit Agreement.  The First Lien
Credit Agreement shall close and fund simultaneously with the confirmation of
the satisfaction or waiver of the conditions under this Section 4 and the
declaration that the Closing Date shall have occurred.

 

(k)           Financial
Information.  The Company shall have
provided to the Administrative Agent and the Lenders the Pro Forma Balance
Sheet and other financial information described in Section 3.1(a) and
(b).

 

(l)            Solvency
Certificate.  The Administrative
Agent shall have received a solvency certificate from the chief financial
officer of the Company.

 

(m)          Borrowing Base
Certificate.  The Administrative
Agent shall have received a Borrowing Base Certificate dated as of the Closing
Date duly executed by a Responsible Officer setting forth a calculation of the
Borrowing Base as of March 31, 2007 (adjusted to give effect to the
transactions occurring on or prior to the Closing Date in connection with the
Acquisition) and the Outstanding Amount of Covered Debt, after giving effect to
the extensions of credit requested to be made on such date and the use of
proceeds thereof, shall not exceed the Borrowing Base as so calculated.

 

(n)           Company Material
Adverse Effect.  As of the Closing
Date, a Company Material Adverse Effect shall not have occurred or be
continuing.

 

(o)           Representations
and Warranties.  As of the Closing
Date, each of the representations and warranties made by the Company in or
pursuant to the Loan Documents shall be true and correct in all material
respects on and as of such

 

48

 

date
as if made on and as of such date (except to the extent such representations
and warranties relate to an earlier date, in which case, such representations
and warranties shall have been true and correct in all material respects as of
such earlier date).

 

(p)           No Event of
Default.  As of the Closing Date no
Event of Default shall have occurred and be continuing.

 

SECTION 5    AFFIRMATIVE
COVENANTS

 

Holdings and the Company hereby jointly agree that,
so long as the Commitments remain in effect or any Loan, interest or fee
payable hereunder is owing to any Lender:

 

5.1.          Financial Statements.  The Company shall furnish to the
Administrative Agent and each Lender:

 

(a)           as
soon as available, but in any event within 90 days after the end of each
fiscal year of the Company, a copy of the audited consolidated balance sheet of
the Company and its consolidated Subsidiaries as at the end of such year and
the related audited consolidated statements of operations and comprehensive
income, member’s interest and of cash flows for such year (other than with
respect to the fiscal period ending December 31, 2007, for which the
audited consolidated balance sheet of the Company and its Subsidiaries
and the related audited consolidated statements of operations and comprehensive
income, member’s interest and cash flows shall be for the period commencing on
the Closing Date and ending on December 31, 2007) and commencing with the
fiscal period ending December 31, 2009, setting forth in each case in
comparative form the figures for the previous year, reported on without a “going
concern” or like qualification or exception, or qualification arising out of
the scope of the audit, by KPMG LLP or other independent certified public
accountants of nationally recognized standing, provided that, for the fiscal
period ended December 31, 2007, the Company shall have an additional 30
days to deliver such financial statements;

 

(b)           as soon as available, but in any
event not later than 45 days after the end of each of the first three quarterly
periods of each fiscal year of the Company, commencing with the fiscal period
ending September 30, 2007, the unaudited consolidated balance sheet of the
Company and its consolidated Subsidiaries as at the end of such quarter and the
related unaudited consolidated statements of operations and comprehensive
income, member’s interest and of cash flows for such quarter and the portion of
the fiscal year through the end of such quarter and commencing with the fiscal
quarter ending March 31, 2009, setting forth in each case in comparative
form the figures for the previous year, certified by a Responsible Officer as
being fairly stated in all material respects (subject to the absence of normal
year-end audit adjustments, footnotes and, with respect to the fiscal period
ending September 30, 2007, adjustments for purchase accounting), provided
that for the fiscal period ended September 30, 2007, (i) the Company
shall have an additional 30 days to deliver such financial statements and (ii) the
unaudited consolidated balance sheet of the Company and its Subsidiaries and
the related unaudited consolidated statement of operations and comprehensive
income, member’s interest and cash flows shall be for the period commencing on
the Closing Date and ending on September 30, 2007; and

 

(c)           as soon as available after
the end of each fiscal year of the Company the unaudited annual balance sheet
and statement of income for each Foreign Subsidiary that have been used as the
basis for determining Eligible Value of all Eligible Foreign Pledged Equity;
provided that, if any such financial statements are not delivered within 120
days after the end of

 

49

 

such fiscal year, the
Eligible Value of the Eligible Foreign Pledged Equity in respect of which such
statements are used as a basis for determining the Eligible Value thereof shall
be deducted from the Borrowing Base until such statements have been delivered
to the Administrative Agent, but the failure to deliver such financial
statements shall not otherwise constitute a Default or Event of Default
hereunder.

 

All such financial statements shall be
complete and correct in all material respects and shall be prepared in
reasonable detail and in accordance with GAAP applied (except as approved by
such accountants or officer, as the case may be, and disclosed in reasonable
detail therein or otherwise excepted herein) consistently throughout the
periods reflected therein and with prior periods.

 

5.2.          Borrowing
Base Certificate.

 

(a)           Not later than ten Business Days after the delivery of any
financial statements pursuant to Section 5.1(a) or (b) (commencing
with the delivery of financial statements of the Company for the first fiscal
quarter ended after the Closing Date), the Company shall deliver to the
Administrative Agent a Borrowing Base Certificate duly executed by a
Responsible Officer setting forth a calculation of the Borrowing Base as of the
end of the most recent fiscal quarter covered by such financial statements.

 

(b)           The Company may, at its option, deliver to the
Administrative Agent a Borrowing Base Certificate from time to time, together
with and calculated based upon, an unaudited consolidated balance sheet of the
Company and its Subsidiaries as at the end of a fiscal month subsequent to the
period for which the most recent Borrowing Base Certificate was delivered
pursuant to Section 5.2(a).

 

(c)           Within (i) 30 days of the Closing Date, the Company
shall deliver to the Administrative Agent a Borrowing Base Certificate setting
forth a calculation of the Borrowing Base as of June 30, 2007, and (ii) 55
days after the end of the fiscal period ending September 30, 2007, the
Company shall deliver to the Administrative Agent a Borrowing Base Certificate
setting forth a calculation of the Borrowing Base as of September 30,
2007, in each case, it being acknowledged that such calculations shall be a
good faith estimate on interim accounts.

 

5.3.          Compliance
and Other Information.  The Company
shall deliver to the Administrative Agent:

 

(a)           concurrently with
the delivery of the financial statements referred to in Section 5.1(a), a
certificate of the independent certified public accountants reporting on such
financial statements stating that in making the examination necessary therefor
no knowledge was obtained of any Default or Event of Default under Sections 6.1
and 6.2, except as specified in such certificate (it being understood that such
certificate shall be limited to the items and scope that independent certified
public accountants are permitted to cover in such certificates pursuant to
their professional standards and customs of profession);

 

(b)           concurrently with
the delivery of any financial statements pursuant to Section 5.1(a) and
(b), (i) a certificate of a Responsible Officer stating that such
Responsible Officer has obtained no knowledge of any Default or Event of
Default except as specified in such certificate and (ii) in the case of
quarterly or annual financial statements, (x) a Compliance Certificate
containing all information and calculations necessary for determining
compliance by each Group Member with the provisions of this Agreement referred
to therein as of the last day of the fiscal quarter or fiscal year of the
Company, as the case may be, (y) to the extent not previously disclosed to
the Administrative Agent, (1) a description of any change in the
jurisdiction of

 

50

 

organization
of any Loan Party, and (2) a description of any Person that has become a
Group Member, in each case since the date of the most recent report delivered
pursuant to this clause (y) (or, in the case of the first such report so delivered,
since the Closing Date) and (z) a calculation of Available Liquidity as of
the last day of the fiscal period covered by such financial statements;

 

(c)           as soon as
available, and in any event no later than 60 days after the end of each fiscal
year of the Company, a detailed consolidated budget for the following fiscal
year (including a projected consolidated balance sheet of the Company and its
Subsidiaries as of the end of the following fiscal year, the related
consolidated statements of projected cash flow, projected changes in financial
position and projected income and a description of the underlying assumptions
applicable thereto) (collectively, the “Projections”), which Projections
shall in each case be accompanied by a certificate of a Responsible Officer
stating that such Projections are based on good faith estimates, information
and assumptions believed by management to be reasonable at the time made and
that such Responsible Officer has no reason to believe that such Projections
are incorrect or misleading in any material respect it being recognized by the
Lenders that such financial information as it relates to future events is not
to be viewed as fact and that actual results during the period or periods
covered by such financial information may differ from the projected results set
forth therein by a material amount;

 

(d)           concurrently with
the delivery of any financial statements pursuant to Section 5.1(a) and
(b), a narrative discussion and analysis of the financial condition and results
of operations of the Company and its Subsidiaries for such fiscal quarter and
for the period from the beginning of the then current fiscal year to the end of
such fiscal quarter, as compared to the portion of the Projections covering
such periods and beginning March 31, 2009 to the comparable periods of the
previous year and within 10 Business Days of the delivery thereof the Company
shall host one conference call for the Lenders under this Agreement with
management of the Company to discuss the same (which the Company may combine
into one call with the Lenders under the First Lien Credit Agreement);

 

(e)           as soon as
practicable prior to the effectiveness thereof, copies of substantially final
drafts of any material amendment, supplement, waiver or other modification with
respect to the Acquisition Documentation;

 

(f)            promptly following
any request therefor, on and after the effectiveness of the Pension Act, copies
of (i) any documents described in Section 101(k) of ERISA that
the Company or any Commonly Controlled Entity may request with respect to any
Multiemployer plan and (ii) any notices described in Section 101(l) of ERISA that the Company or any Commonly Controlled
Entity may request with respect to any Plan or Multiemployer Plan; provided,
that if the Company or any Commonly Controlled Entity has not requested such
documents or notices from the administrator or sponsor of the applicable Plan
or Multiemployer Plan, the Company or the applicable Commonly Controlled Entity
shall promptly make a request for such documents or notices from such
administrator or sponsor and shall provide copies of such documents and notices
promptly after receipt thereof; and

 

(g)           promptly, such
additional financial and other information as the Administrative Agent may from
time to time reasonably request.

 

5.4.          Maintenance
of Existence; Payment of Obligations; Compliance with Law.  (a)  The Company will, and will cause
each Group Member to, continue to engage primarily in the automotive business
and preserve, renew and keep in full force and effect its corporate existence
and take all reasonable actions to maintain all rights necessary for the normal
conduct of its business, except to the

 

51

 

extent that failure to do so
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.

 

(b)           The Company will, and will cause each Group Member to,
pay, discharge or otherwise satisfy at or before maturity or before they become
delinquent, as the case may be, all its material obligations of whatever
nature, except where the amount or validity thereof is currently being
contested in good faith by appropriate proceedings and reserves in conformity
with GAAP with respect thereto have been provided on the books of the relevant
Group Member or where the failure to do so could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

(c)           The Company will, and will cause each Group Member to,
comply with all Contractual Obligations and Requirements of Law except to the
extent that failure to comply therewith could not, in the aggregate, reasonably
be expected to have a Material Adverse Effect.

 

5.5.          Maintenance
of Property; Insurance.  The Company
will, and will cause each Loan Party to, maintain, as appropriate, with
insurance companies that the Company believes (in the good faith judgment of
the management of the Company) are financially sound and responsible at the
time the relevant coverage is placed or renewed, insurance in amounts (after
giving effect to any self-insurance which the Company believes (in the good
faith judgment of management of the Company) is reasonable and prudent in light
of the size and nature of its business) and against at least such risks (and
with such risk retentions) as the Company believes (in the good faith judgment
of the management of the Company) are reasonable in light of the size and
nature of its business.

 

5.6.          Notices.  Promptly upon a Responsible Officer of the
Company becoming aware thereof, the Company shall give notice to the
Administrative Agent and each Lender of:

 

(a)           the occurrence of any Default or Event of Default;

 

(b)           any (i) default or event of default under any
Contractual Obligation of any Group Member or (ii) litigation,
investigation or proceeding that may exist at any time between any Group Member
and any Governmental Authority, that in either case, could reasonably be
expected to have a Material Adverse Effect;

 

(c)           any litigation or proceeding affecting any Group Member (i) in
which the amount involved is $250,000,000 or more and not covered by insurance
or contributions of a third party that, in the judgment of the Company has the
means to pay such contributions (ii) in which injunctive or similar relief
is sought that, if obtained, could reasonably be expected to have a Material
Adverse Effect or (iii) which relates to any Loan Document;

 

(d)           the following events, as soon as possible and in any event
within 30 days after the Company knows or has reason to know thereof:  (i) the occurrence of any Reportable
Event with respect to any Plan; a failure to make any required contribution to
a Plan or Multiemployer Plan; (ii) on and after the effectiveness of the
Pension Act, a determination that any Plan is, or is expected to be, in “at
risk” status (within the meaning of Title IV of ERISA); (iii) any
withdrawal from, or the termination, Reorganization or Insolvency of, any
Multiemployer Plan or the determination that any Multiemployer Plan is in
endangered or critical status, within the meaning of Section 432 of the
Code or Section 305 or Title IV of ERISA, or (iv) the institution of
proceedings or the taking of any other action by the PBGC or the Company or any
Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the termination, Reorganization or Insolvency of, any Plan
or Multiemployer Plan; except, in the case of any or all of (i) through
(iv), as could not reasonably be expected to result in a Material Adverse
Effect; and

 

52

 

(e)           any development or event that has had or could reasonably
be expected to have a Material Adverse Effect.

 

Each notice pursuant to this Section 5.6
shall be accompanied by a statement of a Responsible Officer setting forth
details of the occurrence referred to therein and stating what action the
relevant Group Member proposes to take with respect thereto.

 

5.7.          Additional
Collateral, etc..  (a)  Within
30 days after the formation or acquisition of any Additional Subsidiary
Guarantor (or the making of a single investment or a series of related
investments having a value (determined by reference to Net Book Value, in the
case of an investment of assets) of $250,000,000 or more in the aggregate by
the Company or a Subsidiary Guarantor, directly or indirectly, in a Domestic
Subsidiary (other than an Excluded Subsidiary) that is not a Subsidiary
Guarantor or the acquisition of any property or assets by a Domestic
Subsidiary, in each case, that results in such Domestic Subsidiary becoming an
Additional Subsidiary Guarantor), the Company shall (or shall cause the
relevant Subsidiary to) (i) execute and deliver to the Collateral Trustee
such amendments or supplements to the Security Agreement as the Administrative
Agent deems necessary to grant to the Collateral Trustee, for the benefit of
the Secured Parties, a perfected security interest in the Capital Stock of such
Additional Subsidiary Guarantor (or Domestic Subsidiary receiving such
investment(s) or acquiring such property or assets), (ii) deliver to
the Collateral Trustee the certificates, if any, representing such Capital
Stock (to the extent constituting “certificated securities” under the
applicable UCC), together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of the relevant Loan Party, and (iii) cause
such Additional Subsidiary Guarantor (or Domestic Subsidiary receiving such
investment(s) or acquiring such property or assets) (A) to become a
party to the Security Agreement, the Guarantee and the Collateral Trust
Agreement and (B) to take such actions as are necessary to grant to the
Collateral Trustee for the benefit of the Secured Parties a valid, perfected
security interest in the Collateral described in the Security Agreement with
respect to such Additional Subsidiary Guarantor (or Domestic Subsidiary
receiving such investment(s) or acquiring such property or assets),
including the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by law.

 

(b)           Within 30 days after the formation or acquisition of any
new Foreign Subsidiary the Capital Stock of which is owned directly by the
Company or any Subsidiary Guarantor (other than the Capital Stock of any
Excluded Subsidiary or any other Subsidiary to the extent the ownership
interest in such Subsidiary has a Net Book Value of $250,000,000 or less), the
Company shall (or shall cause the relevant Subsidiary Guarantor to) promptly (i) execute
and deliver to the Administrative Agent such amendments or supplements to the
Security Agreement as the Collateral Trustee or the Administrative Agent deems
necessary to grant to the Collateral Trustee, for the benefit of the Secured
Parties, a perfected security interest in a portion of the Capital Stock of
such new Foreign Subsidiary that is owned by the Company or such Subsidiary
Guarantor (provided that in no event shall more than 66% of the total
outstanding Voting Stock of any such new Foreign Subsidiary be required to be
so pledged unless the Company in its sole discretion otherwise agrees), and (ii) deliver
to the Collateral Trustee the certificates, if any, representing such Capital
Stock, together with undated stock powers, in blank, executed and delivered by
a duly authorized officer of the Company or the relevant Subsidiary Guarantor,
and take such other action as may be reasonably requested by the Collateral
Trustee or the Administrative Agent in order to perfect the Collateral Trustee’s
security interest therein including the execution and delivery of a pledge
agreement governed by the law of the jurisdiction in which such Foreign
Subsidiary is domiciled.

 

(c)           The Company shall use its commercially reasonable efforts
to (i) grant to the Collateral Trustee, for the benefit of the Secured
Parties, a security interest in the Capital Stock of any newly-formed or
after-acquired joint venture (or a holding company parent thereof) owned
directly by the Company or a Subsidiary Guarantor if the amount recorded by the
Company or such Subsidiary Guarantor as its investment in such joint venture
exceeds $250,000,000 and (ii) in the case of any

 

53

 

domestic JV Subsidiary in which the Company directly or indirectly owns
at least 80% of the voting or economic interest, to cause such JV Subsidiary to
become a Subsidiary Guarantor (in each case, it being understood that such
efforts shall not require any economic or other significant concession or
result in any adverse tax consequences with respect the terms or structure of
such joint venture arrangements).

 

(d)           Within 30 days after the occurrence thereof, the
Company will notify the Collateral Trustee and the Administrative Agent of any
changes to the name, jurisdiction of incorporation or formation or legal form
of the Company or any Subsidiary Guarantor.

 

(e)           The Company shall use reasonable efforts to deliver
to the Administrative Agent no later than 180 days after the Closing Date each
of the items described on Schedule 5.7(e) (collectively the “Post-Closing
Deliverables”) and each Real Estate Deliverable.  If any of the Post-Closing Deliverables or
Real Estate Deliverables are not provided within such 180-day period (i) the
Borrowing Base will be reduced by the Eligible Value of the Capital Stock for
which a Post-Closing Deliverable is outstanding or by the Eligible Value of the
Eligible P&E for which a Real Estate Deliverable is outstanding and no Default
or Event of Default shall be deemed to have occurred as a result thereof, and (ii) the
Applicable Margin shall be increased by 0.25% until such time as all
outstanding Post-Closing Deliverables are delivered.

 

(f)            The Company shall promptly take such steps as the
Administrative Agent may reasonably request in order to grant, preserve,
protect and perfect the validity and priority of the security interests created
or intended to be created in the Collateral. 
Notwithstanding anything to the contrary herein or in any other Loan
Document, neither the Company nor any Subsidiary Guarantor shall be required to
perfect the security interests granted by it in any Collateral by any means
other than by (a) execution, delivery and recordation of a Mortgage, (b) filings
pursuant to the UCC of the relevant State(s) (including with respect to
fixtures covered by any Mortgage) or equivalent filings under local
jurisdictions to the extent required with respect to the pledge of the Capital
Stock of any Foreign Subsidiary, (c) delivery to the Collateral Trustee to
be held in its possession of each promissory note listed on Schedule 4.1(g),
together with an undated endorsement for each such promissory note executed in
blank by a duly authorized officer of the pledgor thereof, and, to the extent
certificated and constituting “certificated securities” under the UCC, Capital
Stock listed on Schedule 3.13(a) or required to be pledged pursuant to Section 5.7(a),
together with an undated stock power for each such certificate executed in
blank by a duly authorized officer of the pledgor thereof, (d) delivery of
each other promissory note or certificated Capital Stock and constituting “certificated
securities” under the UCC constituting Collateral to the extent such promissory
note evidences Indebtedness, or such Capital Stock has a Net Book Value, in
excess of $250,000,000, together with an undated endorsement or stock power for
each such promissory note or certificate, as applicable, executed in blank by a
duly authorized officer of the pledgor thereof and (e) filing with the
United States Patent and Trademark Office and the United States Copyright
office, as the case may be, against any registered trademarks, patents and
copyrights listed on Schedule 1.1F.

 

(g)           By June 30 and December 31 of each year,
the Company shall deliver to the Administrative Agent and the Collateral
Trustee a notice containing a list of all patents and trademarks registered by
the Company or any Loan Party at the United States Patent and Trademark Office
since the last such notice was delivered (or in the case of the first notice,
since the Closing Date), and shall take such steps as the Administrative Agent
may reasonably request in order to perfect the security interests granted in
such Collateral by filing against such patents and trademarks at the United
States Patent and Trademark Office.

 

(h)           At the request of the Company and notwithstanding Section 9.1(a),
the Administrative Agent shall negotiate with the Company in good faith to
amend Schedule 1.1B to include 

 

54

a Borrowing Base Amount calculation for any asset of the Company or any
Subsidiary that does not have a Borrowing Base Amount at the time such asset
becomes Collateral (including the Advance Percentage related thereto and any
eligibility or other requirements the Administrative Agent deems reasonably
necessary for a determination thereof consistent with the criteria used in
determining Borrowing Base Amounts as of the Closing Date).

 

(i)            With respect to any fee interest in any real
property having a value (together with improvements thereof) of at least
$20,000,000 acquired after the Closing Date by any Loan Party (other than (x) any
such real property subject to a Lien expressly permitted by clause (h) of
the definition of Permitted Liens or (y) dealership properties), promptly (i) execute
and deliver a first (and second) priority Mortgages, in favor of the Collateral
Trustee covering such real property, (ii) if requested by the
Administrative Agent or the Collateral Trustee, provide (x) title and
extended coverage insurance covering such real property in an amount at least
equal to the purchase price of such real property (or such other amount as
shall be reasonably specified by the Administrative Agent or the Collateral
Trustee) as well as a current ALTA survey thereof, together with a surveyor’s
certificate and (y) any consents or estoppels reasonably deemed necessary
or advisable by the Administrative Agent or the Collateral Trustee in connection
with such Mortgage, each of the foregoing in form and substance reasonably
satisfactory to the Administrative Agent and Collateral Trustee and (iii) if
requested by the Collateral Trustee, deliver to the Collateral Trustee legal
opinions relating to the matters described above, which opinions shall be in
form and substance, and from counsel, reasonably satisfactory to the Collateral
Trustee.

 

(j)            Notwithstanding anything to the contrary herein, in
no case shall a Person be required to grant a security interest in any stock of
a CFC (other than 100% of the nonvoting stock (if any) and 65% of the Voting
Stock of a first-tier CFC).

 

(k)           If any Loan Party shall obtain an interest in any
Commercial Tort Claim (as defined in the Security Documents) with a potential
value in excess of $100,000,000, such Loan Party shall within 30 days after
obtaining such interest sign and deliver documentation acceptable to the
Administrative Agent granting a security interest to the Collateral Trustee
under the terms and provisions of the Security Agreement in and to such
Commercial Tort Claim.

 

5.8.          Environmental
Laws.  The Company shall and shall
cause each Group Member to comply in all respects with all applicable
Environmental Laws, and obtain and comply in all material respects with and
maintain any and all licenses, approvals, notifications, registrations or
permits required by applicable Environmental Laws, except, in each case, where
the failure to comply with such Environmental Laws or obtain such licenses,
approvals, notifications, registrations or permits could not reasonably be
expected to have a Material Adverse Effect.

 

5.9.          Inspection of
Property; Books and Records; Discussions.  The Company shall and shall cause each Group
Member to (a)  keep proper books of records and account in which full,
true and correct entries in conformity with GAAP and all Requirements of Law
shall be made of all dealings and transactions in relation to its business and
activities, and (b) permit representatives of the Administrative Agent or
during the continuance of any Event of Default, any Lender, to visit and
inspect any of its properties and examine and make abstracts from any of its
books and records upon reasonable prior notice during normal business hours and
as often as may reasonably be desired and to discuss the business, operations,
properties and financial and other condition of the Group Members with officers
and employees of the Group Members and with their independent certified public
accountants.  The Company shall not have
any obligation to disclose materials that are protected by attorney-client
privilege and materials the disclosure of which would violate confidentiality
obligations of the Company.

 

55

 

SECTION 6            NEGATIVE COVENANTS

 

The Company hereby agrees that, so long as the Commitments remain in
effect, or any Loan, interest or fee payable hereunder is owing to any Lender:

 

6.1.          Borrowing Base.  The Company shall not permit the Outstanding
Amount of Covered Debt at any time to exceed the Borrowing Base then in effect
at such time for any period of five consecutive Business Days.

 

6.2.          Available Liquidity.  The Company shall not permit Available
Liquidity of the Company and Domestic Subsidiaries (in the aggregate) to be less
than $2,000,000,000 for any period of 5 consecutive Business Days.

 

6.3.          Liens.  The Company and Holdings will not, nor will
they permit any Group Member to, create, incur, assume or suffer to exist any
Lien upon any of the Collateral except Permitted Liens.

 

6.4.          Indebtedness.  The Company will not, nor will it permit any
Group Member to, create, incur, assume or suffer to exist any Indebtedness
except Permitted Indebtedness.

 

6.5.          Asset Sale
Restrictions.  The Company
and Holdings shall not, and shall not permit any Group Member to, Dispose of
any of its property, whether now owned or hereafter acquired, except:

 

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

 

(b)           Dispositions of obsolete or worn out property in the
ordinary course of business including, without limitation, leases with respect
to facilities that are temporarily not in use or pending their disposition, or
accounts receivable in connection with the compromise, settlement or collection
thereof;

 

(c)            Dispositions of any JV Subsidiaries Stock in
accordance with the applicable joint venture agreement relating thereto;

 

(d)           any Disposition of (i) any Domestic Subsidiary’s
Capital Stock to the Company or any Subsidiary Guarantor or (ii) any
Foreign Subsidiary’s (other than any Foreign Subsidiary, the stock of which is
pledged as Collateral) stock to the Company, any Subsidiary Guarantor or any
other Foreign Subsidiary;

 

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

 

(f)            to the extent allowable under Section 1031 of
the Code, any Disposition of assets in exchange for other like property for use
in a business of the Company and its Subsidiaries;

 

(g)           any Disposition by the Company or any of its
Subsidiaries of any dealership property or Capital Stock in a dealership
Subsidiary to the operating management of a dealership or any Disposition of
property in connection with the dealer optimization plan, in each case, in the
ordinary course of business;

 

56

 

(h)           any Disposition of assets between or among (i) the
Loan Parties and (ii) the Company and its Subsidiaries and FinCo and its
Subsidiaries in accordance with the Master Agreement;

 

(i)             the licensing and sublicensing of patents,
trademarks and other intellectual property or other general intangibles to
third persons on customary terms as determined by the board of directors, or
such other individuals as they may delegate, in good faith and the ordinary
course of business;

 

(j)             any Disposition required by the terms of any
Permitted Transaction and made in accordance with such terms;

 

(k)            any Disposition of any other assets with an
aggregate Net Book Value during the term of this Agreement not to exceed
$300,000,000;

 

(l)             any Disposition of assets listed on Schedule 6.5;

 

(m)           any Disposition of any other assets (other than
Principal Trade Names); provided that, (i) after giving pro forma effect
to such Disposition and the application of proceeds therefrom, the Borrowing
Base Coverage Ratio is (or after giving effect to any concurrent deposit into
the Asset Sale Collateral Account, will be) at least 1.15:1.00, (ii) for
up to $300,000,000 in the aggregate (by Net Book Value) of assets Disposed of
under this clause (m) at least 50% of the consideration for such
Disposition is in cash or Cash Equivalents and thereafter at least 75% of the
consideration for such Disposition is in cash or Cash Equivalents, and (iii) to
the extent such Disposition constitutes an Asset Sale, the Net Cash Proceeds
thereof shall be reinvested or committed to be reinvested to acquire or repair
assets useful in the business of the Company within 18 months of such
Disposition or, if not so reinvested or committed to be reinvested, then,
within ten days of the Reinvestment Prepayment Date, the Company shall make a
Mandatory Prepayment with such Net Cash Proceeds not so reinvested or committed
for reinvestment within such period pursuant to Section 2.5(a)(ii).  Pending the final application of any Net Cash
Proceeds, the Company may invest the Net Cash Proceeds in any manner that is
not prohibited by this Agreement;

 

(n)           the transfer to DaimlerChrysler AG or its Affiliates
of certain businesses related to Mercedes-Benz and Freightliner/Sterling
located in Venezuela and Mexico required by the IDCA;

 

(o)           licensing of Principal Trade Names for use in
industries other than the automotive, motor vehicle or related industries; and

 

(p)           Dispositions permitted by clause (i) of Section 6.7(b) or
Section 6.10.

 

Notwithstanding anything in this Section 6.5
to the contrary, (i) any Disposition described in this Section 6.5
shall be permitted if such Disposition is to a Loan Party and (ii) in no
circumstance shall any Disposition of, or any Disposition the effect of which
is to Dispose of, any Principal Trade Name be permitted hereunder (other than
as specified in clause (o)).

 

6.6.          Restricted Payments.  The Company will not, and will not permit any
Subsidiary to, (i) declare or pay any dividend (other than dividends
payable solely in common Capital Stock of the Person making such dividend) on,
or make any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement or other
acquisition of, any Capital Stock of any Group Member, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either directly
or indirectly, whether in cash or property or in obligations of any Group
Member, and (ii) optionally prepay, repurchase, redeem or otherwise
optionally satisfy or 

 

57

 

defease with cash, Cash Equivalents or Temporary Cash Investments any
Material Unsecured Indebtedness (any such payment referred to in clauses (i) and
(ii), a “Restricted Payment”), other than:

 

(a)           redemptions, acquisitions or
the retirement for value or repurchases (or loans, distributions or advances to
effect the same) of shares of Capital Stock from current or former officers,
directors, consultants and employees, including upon the exercise of stock
options or warrants for such Capital Stock, or any executive or employee
savings or compensation plans, or, in each case, to the extent applicable,
their respective estates, spouses, former spouses or family members or other
permitted transferees;

 

(b)           any Permitted Refinancing of
Material Unsecured Indebtedness; provided that a certificate of a Responsible
Officer of the Company is delivered to the Administrative Agent at least five
Business Days (or such shorter period as the Administrative Agent may
reasonably agree) prior to the incurrence of such Indebtedness, together with a
reasonably detailed description of the material terms and conditions of such
Indebtedness or drafts of the documentation relating thereto, stating that the
Company has determined in good faith that such terms and conditions satisfy the
foregoing requirement and such terms and conditions shall be deemed to satisfy
the foregoing requirement unless the Administrative Agent notifies the Company
within such period that it disagrees with such determination (including a
reasonable description of the basis upon which it disagrees);

 

(c)           commencing upon delivery in
accordance with Section 5.1(a) of the audited financial statements
for the Company for the 2008 fiscal year, additional Restricted Payments in an
aggregate amount in each fiscal year not to exceed Cumulative Excess Cash Flow
as of the last day of the preceding fiscal year provided that no Default or
Event of Default has occurred and is continuing at the time of any such
Restricted Payment and after giving pro forma effect to such Restricted Payment
the Borrowing Base Coverage Ratio is at least 1.15 to 1.00;

 

(d)           even if a Default or Event
of Default has occurred and is continuing, the Company may make distribution of
assets to any Parent Entity to fund a repurchase or redemption by such Parent
Entity of the Capital Stock of such Parent Entity owned by any DC Contributor
that may be repurchased or redeemed in accordance with the terms of the limited
liability company agreement of Chrysler Holding LLC (the “DCH Equity
Redemption Obligation”) to satisfy the DCH Equity Redemption Obligation as
long as contemporaneously with such distribution the Sponsor (or any Parent
Entity) shall have made a contribution of cash or Cash Equivalents or other
assets to the Company with a value at least equal to the assets distributed;

 

(e)           any Subsidiary (including an
Excluding Subsidiary) may make Restricted Payments to its direct parent or to
the Company or any Wholly Owned Subsidiary Guarantor;

 

(f)            the Company may pay
dividends to any Parent Entity to enable such Person to reimburse the
reasonable out-of-pocket expenses of Sponsor incurred in connection with
providing or obtaining management, consulting, monitoring, financial advisory,
accounting or other services to or for the benefit of the Parent Entity or the
Group Members;

 

(g)           the Company may make
Restricted Payments to any Parent Entity to enable such Person to (i) pay
corporate overhead expenses incurred in the ordinary course of business
(including, without limitation, franchise taxes, directors’ fees and reasonable
accounting, legal and administrative expenses of any such Parent Entity), and (ii) pay
any taxes that would be due and payable by any such Parent Entity or its direct
or indirect members that are directly 

 

58

 

attributable to such Parent
Entity’s ownership interest in the Company and its Subsidiaries in an amount
computed for any taxable year or period on the basis as if such Parent Entity
had elected to be treated as a corporation for all income tax purposes as of
the day immediately following the Closing Date;

 

(h)           any JV Subsidiary may make
Restricted Payments required or permitted to be made pursuant to the terms of
the joint venture arrangements of holders of its Capital Stock;

 

(i)            the Company and its
Subsidiaries may make Restricted Payments to FinCo and its Subsidiaries to the
extent required by the Master Agreement;

 

(j)            the Company may make
payments, to any Parent Entity (to enable such Person to make distributions) or
pay directly to DaimlerChrysler AG (or any of its Affiliates), with the
proceeds of any tax refund received by the Company in connection with any taxes
paid by the Company in respect of any period prior to the Closing Date, to the
extent such tax refunds are to be shared with DaimlerChrysler AG pursuant to
the terms of Section 7.02(b) of the Acquisition Agreement; and

 

(k)           the Company and any of its
Subsidiaries may make payments to satisfy the Acquisition True-Up Obligations
to the extent required by the Acquisition Agreement.

 

6.7.          Fundamental Changes.  The Company will not, and will not permit any
Group Member to, enter into any merger, consolidation or amalgamation, or
liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution), or Dispose of all or substantially all of its property or
business, except that:

 

(a)           (i) any Subsidiary of the Company may be
merged, consolidated or amalgamated with or into the Company (provided that the
Company shall be the continuing or surviving corporation) or with or into any
Wholly Owned Subsidiary Guarantor (provided that the Wholly Owned Subsidiary Guarantor
shall be the continuing or surviving corporation) (ii) any Excluded
Subsidiary may merge, consolidate or amalgamate with any other Excluded
Subsidiary; and

 

(b)           any Subsidiary of the Company may Dispose of any or
all of its assets (i) to the Company or any Wholly Owned Subsidiary
Guarantor (upon voluntary liquidation, winding up, dissolution or otherwise) or
(ii) pursuant to a Disposition permitted by Section 6.5.

 

Notwithstanding anything contained in this Section 6.7 to the
contrary, any Investment expressly permitted by Section 6.10 may be
structured as a merger, consolidation or amalgamation.

 

6.8.          Negative Pledge.  The Company will not itself, and will not
permit any Domestic Subsidiary (other than an Excluded Subsidiary) to, enter
into or suffer to exist or become effective any agreement that prohibits or
limits the ability of the Company or any such Subsidiary to create, incur,
assume or suffer to exist any Lien upon any of its property or revenues,
whether now owned or hereafter acquired, to secure its obligations under the
Loan Documents to which it is a party other than (a) this Agreement and
the other Loan Documents, (b) any agreements governing any purchase money
Liens, Capital Lease Obligations or any Permitted Transactions otherwise
permitted hereby (in which case, any prohibition or limitation shall only be
effective against the assets financed thereby or transferred thereto), and (c) the
DC Credit Support Agreement and the related escrow, control and security
agreements, provided that any such prohibition or limitation shall be effective
only against one or more segregated deposit or securities accounts created
pursuant to such agreements.

 

59

 

6.9.          Sale/Leaseback
Transactions.  The Company
will not itself, and it will not permit any Group Member to, enter into any
arrangement with any Person providing for the leasing by any such Group Member
of real or personal property that has been or is to be sold or transferred by
any such Group Member to such Person or to any other Person to whom funds have
been or are to be advanced by such Person on the security of such property or
rental obligations of any such Group Member (a “Sale/Leaseback Transaction”),
except (i) that the Company or a Group Member may enter into any
Sale/Leaseback Transaction after the date of this Agreement, so long as
immediately after giving effect to the incurrence of such Attributable
Obligations with respect to any such Sale/Leaseback Transaction, the
Outstanding Amount of such Attributable Obligations is  permitted to be incurred at such time under Section 6.4,
(ii) in connection with any Permitted Transaction, and (iii) any
other Sale/Leaseback Transactions existing on the Closing Date and set forth on
Schedule 6.9, together with any amendments, extensions, renewals, replacements
or refinancings thereof; provided that any Lien incurred with respect
thereto may not extend to any other property owned by the Group Member.  Notwithstanding any provision to the contrary
contained in the foregoing, any obligations of the Company or any of its
Subsidiaries in respect of the Gelco Lease Program (or any similar program that
supplements or replaces the Gelco Lease Program) shall not constitute
Attributable Obligations for the purposes of this Agreement.

 

6.10.        Investments.  The Company and Holdings shall not, and will
not permit any Group Member to make any advance, loan, extension of credit (by
way of guaranty or otherwise) or capital contribution to, or purchase any
Capital Stock, bonds, notes, debentures or other debt securities of, or any
assets constituting a business unit of, or make any other investment in, any
Person (all of the foregoing, “Investments”), except:

 

(a)           extensions of trade credit
in the ordinary course of business, including, without limitation, to customers
or advances, deposits and payment to or with suppliers, lessors or utilities or
for workers’ compensation or medical insurance;

 

(b)           Investments in Cash
Equivalents or Temporary Cash Investments;

 

(c)           Guarantee Obligations
permitted by Section 6.4;

 

(d)           loans and advances to
directors, officers and employees of any Group Member in the ordinary course of
business (including for travel, entertainment and relocation expenses);

 

(e)           the Acquisition and any
other Investments related to the Acquisition to the extent expressly
contemplated by the Acquisition Documentation;

 

(f)            intercompany Investments by (i) any
Group Member in the Company or any Person that, prior to such investment, is a
Wholly Owned Subsidiary Guarantor and (ii) any non-Loan Party Subsidiary
in any other non-Loan Party Subsidiary;

 

(g)           intercompany Investments
arising from the incurrence of Permitted Indebtedness;

 

(h)           Investments existing on the
Closing Date and renewals or extensions of any such Investment to the extent
not involving any additional Investments other than as the result of the
accrual or accretion of interest or original issue discount or the issuance of
pay-in-kind securities, in each case pursuant to the terms of such Investments
as in effect on the date of this Agreement;

 

(i)            Investments (i) received
in satisfaction or partial satisfaction of delinquent accounts and disputes
with customers or suppliers of such Person in the ordinary course of 

 

60

 

business; (ii) acquired
as a result of foreclosure of a Lien securing an Investment or the transfer of
the assets subject to such Lien in lieu of foreclosure or (iii) consisting
of deposits, prepayments and other credits to suppliers made in the ordinary
course of business consistent with the past practices of the Company and its
Subsidiaries;

 

(j)            Investments constituting
non-cash consideration useful in the operation of the business received by the
Company or any of its Subsidiaries in connection with permitted Asset Sales and
other Dispositions permitted under Section 6.5;

 

(k)           Investments by the Company
or any of its Subsidiaries in FinCo or any of its Subsidiaries (i) to the
extent required or contemplated by the Master Agreement as in effect on the
Closing Date, plus (ii) any additional amount funded from a cash
contribution to the Company’s common Capital Stock;

 

(l)            Investments required
pursuant to the terms of any Permitted Transaction and made in accordance with
such terms;

 

(m)          other Investments not
otherwise expressly permitted by this Section (including, without
limitation, the contribution of assets by a Loan Party to a joint venture or a
JV Subsidiary), in an aggregate amount (including assumed Indebtedness) valued
at the cost at the time of the incurrence not exceeding during the term of this
Agreement 4.2% of Consolidated Total Assets (adjusted to exclude the effect of
purchase accounting) of the Company, as of the last day of the Company’s most
recent fiscal period for which financial statements have been provided pursuant
to Section 5.1;

 

(n)           Investments in Foreign
Subsidiaries in an aggregate principal amount not to exceed $300,000,000;

 

(o)           Investments pursuant to the
terms of that certain Memorandum of Understanding, dated July 4, 2007,
between Chery Automobile Co. LTD. and DaimlerChrysler Company LLC, relating to
the proposed “Chery” bonafide joint venture
arrangement, in an aggregate principal amount not to exceed $750,000,000;

 

(p)           Investments in dealerships in the ordinary course of
business; and

 

(q)           Investments in troubled
suppliers consistent with past practices (consisting of unsecured Guarantee
Obligations under clause (s) of Permitted
Indebtedness) or otherwise consistent with past practices.

 

6.11.        Transactions
with Affiliates.  The Company
will not itself and will not permit any Subsidiary to enter into any
transaction, including any purchase, sale, lease or exchange of property, the
rendering of any service or the payment of any management, advisory or similar
fees, with any Affiliate (other than Holdings, the Company or any Subsidiary)
unless such transaction is (a) otherwise permitted under this Agreement, (b) in
the ordinary course of business of the relevant Group Member, and (c) upon
fair and reasonable terms no less favorable to the relevant Group Member than
it would obtain in a comparable arm’s length transaction with a Person that is
not an Affiliate.  The foregoing
restrictions shall not apply to:

 

(a)           payments to the Sponsor and
its Control Investment Affiliates of reimbursements of reasonable out-of-pocket
reasonable expenses of Sponsor incurred in connection with 

 

61

 

providing or obtaining
management, consulting, monitoring, financial advisory, accounting or other
services to or for the benefit of the Group Members;

 

(b)           reasonable fees and
compensation paid to and indemnity provided on behalf of officers, directors,
consultants or employees of the Company or any of its Subsidiaries pursuant to
customary employment, consulting and benefit arrangements;

 

(c)           any employment, stock
option, stock repurchase, employee benefit compensation, business expense
reimbursement, severance, termination or other employment-related agreements,
arrangements or plans entered into by the Company or any of its Subsidiaries in
the ordinary course of business;

 

(d)           any agreement as in effect
as of the Closing Date and set forth on Schedule 6.11 or any amendment thereto
or any transaction contemplated thereby (including pursuant to any amendment
thereto and any extension of the maturity thereof) and any replacement
agreement thereto so long as any such amendment or replacement agreement is not
materially more disadvantageous to the Agents and the Lenders, in any material
respect, than the original agreement as in effect on the Closing Date;

 

(e)           the agreements entered into
with Affiliates on the Closing Date in connection with the closing of the
Acquisition as the same are in effect as of the Closing Date and the
transactions contemplated thereby;

 

(f)            servicing agreements and
other similar arrangements customary in fleet financing securitization
transactions; and

 

(g)           transactions with the DC
Contributors contemplated by the Acquisition Documentation.

 

6.12.        Swap Agreements.  The Company will not itself, and will not
permit any Subsidiary to enter into any Swap Agreement, except (a) Swap
Agreements entered into to hedge or mitigate risks to which the Company or any
Subsidiary has actual or anticipated exposure (other than those in respect of
Capital Stock) and (b) Swap Agreements entered into in order to
effectively cap, collar or exchange interest rates with respect to any
interest-bearing liability or investment of the Company or any Subsidiary.

 

6.13.        Changes in
Fiscal Periods.  The Company
will not itself and will not permit any Subsidiary to permit the fiscal year of
the Company to end on a day other than December 31 or change the Company’s
method of determining fiscal quarters, in each case, unless otherwise agreed by
the Administrative Agent.

 

6.14.        Clauses
Restricting Subsidiary Distributions.  The Company will not, and will not permit any
Domestic Subsidiary (other than an Excluded Subsidiary) to, enter into or
suffer to exist or become effective any consensual encumbrance or restriction
on the ability of any such Subsidiary to (a) make Restricted Payments in
respect of any Capital Stock of such Subsidiary held by, or pay any
Indebtedness owed to, the Company or any other Subsidiary, (b) make loans
or advances to, or other Investments in, the Company or any other Subsidiary or
(c) transfer any of its assets to the Company or any other Subsidiary,
except for such encumbrances or restrictions existing under or by reason of (i) any
restrictions existing under the Loan Documents or the First Lien Credit
Agreement, (ii) any restrictions with respect to a Subsidiary imposed
pursuant to an agreement that has been entered into in connection with the
Disposition of all or substantially all of the Capital Stock or assets of such
Subsidiary, (iii) any 

 

62

 

agreement or instrument governing
Indebtedness assumed in connection with the acquisition of assets by the
Company or any Subsidiary permitted hereunder or secured by a Lien encumbering
assets acquired in connection therewith, 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, (iv) restrictions
on the transfer of assets subject to any Lien permitted by Section 6.3
imposed by the holder of such Lien or on the transfer of assets subject to a
Disposition permitted by Section 6.5 imposed by the acquirer of such
assets, (v) provisions in joint venture agreements and other similar
agreements (in each case relating solely to the respective joint venture or
similar entity or the equity interests therein) entered into in the ordinary
course of business, (vi) restrictions contained in the terms of any
agreements governing purchase money obligations, Capital Lease Obligations or
Attributable Obligations not incurred in violation of this Agreement; provided,
that such restrictions relate only to the property financed with such
Indebtedness, (vii) restrictions on cash or other deposits imposed by
customers under contracts or other arrangements entered into or agreed to in
the ordinary course of business, (viii) customary non-assignment
provisions in leases, contracts, licenses and other agreements entered into in
the ordinary course of business and consistent with past practices, and (ix) any
encumbrance or restriction imposed by any terms of any Indebtedness permitted
by clause (g) of the definition of Permitted Indebtedness or by any
amendments, modifications, restatements, increases, supplements, refundings,
replacements, or refinancings of the contracts, instruments or obligations
referred to in clauses (i) through (viii) above; provided, however,
that the provisions relating to such encumbrance or restriction contained in
any such Indebtedness amendment, modification, restatement, increase,
supplement, refunding, replacement, or refinancing are no less favorable to the
Company and its Subsidiaries and the Lenders in any material respect, than the
provisions relating to such encumbrance or restriction contained in agreements
referred to in such clause or in the case of any Indebtedness permitted by
clause (g) of the definition of Permitted Indebtedness, this Agreement.

 

6.15.        Amendments to
Acquisition Documentation.  (a) 
Holdings and the Company will not, and will not permit any Group Member to,
amend, supplement or otherwise modify (pursuant to a waiver or otherwise) the
terms and conditions of the indemnities and licenses furnished to the Company
or any of its Subsidiaries pursuant to the Acquisition Documentation such that
after giving effect thereto such indemnities or licenses, taken as a whole,
shall be materially less favorable to the interests of the Loan Parties or the
Lenders with respect thereto or (b) otherwise amend, supplement or
otherwise modify the terms and conditions of the Acquisition Documentation
except for any such amendment, supplement or modification that (i) becomes
effective after the Closing Date and (ii) could not reasonably be expected
to have a Material Adverse Effect.

 

6.16.        Asset Sale
Collateral Account/Borrowing Base Collateral Account.  (a) The Company will not permit the
aggregate amount of cash or Cash Equivalents held in Borrowing Base Collateral
Account to be at any time less than $2,000,000,000, unless (i) amounts
withdrawn from Borrowing Base Collateral Account are immediately applied to
prepay, first, amounts under the First Lien Credit Agreement and thereafter,
the Term Loans (other than scheduled amortization payments), or (ii) Lenders
holding at least 66% of the outstanding Term Loans have consented to a lesser
amount, and (b) the Company may not withdraw amounts from the Asset Sale
Collateral Account unless (i) such amounts are used to prepay the Term
Loans or (ii) such amounts equal the amounts that the Company has,
substantially contemporaneously with such withdrawal, reinvested into its
business, whether such reinvestment is from its working capital or from the
proceeds in the Asset Sale Collateral Account, provided that, no Default or Event
of Default shall have occurred and be continuing at the time of, or as a result
of, such withdrawal.

 

SECTION 7            EVENTS OF DEFAULT

 

If any of the following events shall occur and be continuing:

 

63

 

(a)           the Company
shall fail to pay (i) any principal of any Loan when due, (ii) any
interest or prepayment premium hereunder for a period of 5 Business Days after
the same becomes due and payable or (iii) any other amount due and payable
under any Loan Document for 20 days after receipt of notice of such failure by
the Company from the Administrative Agent (other than, in the case of amounts
in this clause (iii), any such amount being disputed by the Company in good
faith); or

 

(b)           any
representation or warranty made or deemed made by any Loan Party in any Loan
Document or any certified statement furnished by it (including any Borrowing
Base Certificate), in each case shall prove to have been incorrect in any
material respect on or as of the date made or deemed made or furnished; or

 

(c)           any Loan Party
shall default in the observance or performance of (i) its agreements in
Sections 5.6  (a) or (d) or Section 6
or (ii) any other agreement contained in this Agreement or any other Loan
Document and, with respect to clause (ii) only, such default shall
continue unremedied for a period of 30 days after notice thereof to the Company
from the Administrative Agent or the Required Lenders provided that, if the
Company defaults in the observance of Section 6.1 such default shall not
constitute an Event of Default hereunder if within 5 Business Days of such
default the Sponsor shall have made a contribution of capital to Holdings and
Holdings shall have contributed such capital to the Company in an amount
sufficient to repay the Term Loans so that the Outstanding Amount of Covered
Debt shall be less than or equal to the Borrowing Base after such repayment and
the Company shall have made an optional prepayment of the Term Loans with the
proceeds of such capital contributions in accordance with Section 2.4 and
shall have delivered a Borrowing Base Certificate to the Administrative Agent
demonstrating as such; or

 

(d)           any Group
Member (other than a De Minimis Subsidiary) shall (i) default in making
any payment of any principal of any Indebtedness (including any Guarantee
Obligation, but excluding the Loans) on the scheduled or original due date with
respect thereto and such default shall continue unremedied for a period of 90
days; or (ii) default in making any payment of any interest on any such
Indebtedness beyond the period of grace, if any, provided in the instrument or
agreement under which such Indebtedness was created and such default shall
continue unremedied for a period of 90 days; or (iii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause, or
to permit the holder or beneficiary of such Indebtedness (or a trustee or agent
on behalf of such holder or beneficiary) to cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity or (in
the case of any such Indebtedness constituting a Guarantee Obligation) to
become payable and such default shall continue unremedied for a period of 90
days; provided, that a default, event or condition described in clause (i), (ii) or
(iii) of this paragraph (d) shall not at any time constitute an Event
of Default unless, at such time, one or more defaults, events or conditions of
the type described in clauses (i), (ii) and (iii) of this paragraph (d) shall
have occurred and be continuing with respect to Indebtedness the Outstanding
Amount of which exceeds in the aggregate $500,000,000; or

 

(e)           (i) any
Group Member (other than a De Minimis Subsidiary) shall (A) commence any
case, proceeding or other action under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors (1) seeking to have an order for
relief entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding up, 

 

64

 

liquidation,
dissolution, composition or other relief with respect to it or its debts, or (2) seeking
appointment of a receiver, trustee, custodian, conservator or other similar
official for it or for all or any substantial part of its assets, or (B) make
a general assignment for the benefit of its creditors; or (ii) there shall
be commenced against any Group Member (other than a De Minimis Subsidiary) any
case, proceeding or other action of a nature referred to in clause (i) above
that (A) results in the entry of an order for relief or any such
adjudication or appointment or (B) remains undismissed, undischarged or
unbonded for a period of 90 days; or

 

(f)            (i) any
Person shall engage in any “prohibited transaction” (as defined in Section 406
of ERISA or Section 4975 of the Code) involving any Plan; (ii) any “accumulated
funding deficiency” (as defined in Section 302 of ERISA), or, on or after
the effectiveness of the Pension Act, any failure by any Plan to satisfy the
minimum funding standards (within the meaning of Section 412 of the Code
or Section 302 of ERISA) applicable to such Plan, whether or not
waived  shall exist with respect to any
Plan; (iii) any Group Member or Commonly Controlled Entity shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred or will be
assessed Withdrawal Liability to such Multiemployer Plan and such entity does
not have reasonable grounds for contesting such Withdrawal Liability or is not
contesting such Withdrawal Liability in a timely and appropriate manner; (iv) any
Lien in favor of the PBGC or a Plan shall arise on the assets of any Group
Member or any Commonly Controlled Entity; (v) a Reportable Event shall
occur with respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or to terminate, any
Plan, which Reportable Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Required Lenders, likely to result
in the termination of such Plan for purposes of Title IV of ERISA; (vi) any
Plan shall terminate for purposes of Title IV of ERISA; (vii) any Group
Member or any Commonly Controlled Entity shall, or in the reasonable opinion of
the Required Lenders is likely to, incur any liability in connection with the
Insolvency or Reorganization of, a Multiemployer Plan; or (viii) any other
event or condition shall occur or exist with respect to a Plan or Multiemployer
Plan; and in each case in clauses (i) through (viii) above, such
event or condition, together with all other such events or conditions, if any,
could, in the reasonable judgment of the Required Lenders, be expected to have
a Material Adverse Effect; or

 

(g)           one or more
judgments or decrees shall be entered against any Group Member(other than a De
Minimis Subsidiary) that is not vacated, discharged, satisfied, stayed or
bonded pending appeal within 60 days, and involves a liability (not paid or fully
covered by insurance as to which the relevant insurance company has not denied
coverage or by a contribution obligation of a third party that has not denied
or contested such contribution obligation and that, in the judgment of the
Company, has the means to pay such contributions) of either (i) $120,000,000
or more in the case of any single judgment or decree or (ii) $240,000,000
or more in the aggregate; or

 

(h)           the Collateral
Trust Agreement or any Security Document shall cease to be (or any Loan Party
shall so assert) in full force and effect, or any Lien thereunder shall cease
to be (or any Loan Party shall so assert) enforceable and perfected (other than
(i) pursuant to the terms hereof or any other Loan Document or (ii) as
a result of acts or omissions by any Agent or any Lender) with respect to
Collateral with a Net Book Value in excess of $300,000,000; provided that the
foregoing Event of Default shall only be applicable if the Borrowing Base
Coverage Ratio (calculated on a pro forma basis assuming such Collateral is not
in the Borrowing Base) is less than 1.25 to 1.00; or

 

(i)            the guarantee
of any Loan Party (other than the Company) contained in the Guarantee shall
cease to be (or any Loan Party shall so assert) in full force and effect; or

 

65

 

(j)            the occurrence
of a Change of Control;

 

(k)           Holdings shall (i) conduct,
transact or otherwise engage in, or commit to conduct, transact or otherwise
engage in, any business or operations other than those incidental to its
ownership of the Capital Stock of the Company, (ii) incur, create, assume
or suffer to exist any Indebtedness or other liabilities or financial
obligations, except (w) nonconsensual obligations imposed by operation of
law, (x) obligations pursuant to the Loan Documents to which it is a
party, (y) obligations with respect to its Capital Stock and (z) obligations
in the ordinary course incidental to maintaining its existence and complying
with the Loan Documents, or (iii) own, lease, manage or otherwise operate
any properties or assets (including cash (other than cash received in
connection with dividends made by the Company in accordance with Section 6.6
pending application in the manner contemplated by said Section) and Cash
Equivalents) other than the ownership of shares of Capital Stock of the
Company; or

 

(l)            an event of
default shall have occurred and shall be continuing under the First Lien Credit
Agreement and the Indebtedness thereunder shall have been accelerated by the
holders thereof as a result thereof;

 

then, and in any such event, (A) if such
event is an Event of Default specified in paragraph (e) above with respect
to the Company, automatically the Commitments shall immediately terminate and
the Loans (with accrued interest thereon) and all other amounts owing to the
Lenders under this Agreement and the other Loan Documents shall immediately
become due and payable, and (B) if such event is any other Event of
Default, with the consent of the Required Lenders, the Administrative Agent
may, or upon the request of the Required Lenders, the Administrative Agent
shall, by notice to the Company, declare the Loans (with accrued interest
thereon) and all other amounts owing to the Lenders under this Agreement and
the other Loan Documents to be due and payable forthwith, whereupon the same
shall immediately become due and payable. 
Except as expressly provided above in this Section or required by
law (and which cannot be waived), presentment, demand, protest and all other
notices of any kind are hereby expressly waived by the Company.

 

Whenever the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement shall have become
immediately due and payable in accordance with clause (A) or clause (B) above,
the Administrative Agent shall forthwith deliver a Notice of Event of Default
declaring such acceleration to the Collateral Trustee, or if an Event of
Default shall have occurred (but the Loans hereunder and all other amounts
owing under this Agreement shall not have been accelerated) with the consent of
the Required Lenders the Administrative Agent may, and if directed by the
Required Lenders shall, deliver a Notice of Event of Default to the Collateral
Trustee; provided that, by written notice to the Company and the
Administrative Agent, the Required Lenders may, for such periods and/or subject
to such conditions as may be specified in such notice, withdraw any declaration
of acceleration effected in accordance with clause (B) above or such
Notice of Event of Default.  If a
declaration of acceleration in accordance with clause (B) above or a
Notice of Event of Default, as the case may be, shall have been withdrawn in
accordance with the proviso to the immediately preceding sentence, the
Administrative Agent shall forthwith deliver to the Collateral Trustee a notice
of cancellation of the acceleration or Notice of Event of Default.

 

SECTION 8            THE AGENTS

 

8.1.          Appointment.  (a)  Each Lender hereby irrevocably
designates and appoints the Administrative Agent as the agent of such Lender
under this Agreement and the other Loan Documents, and each such Lender
irrevocably authorizes the Administrative Agent, in such capacity, to take such
action on its behalf under the provisions of this Agreement and the other Loan
Documents and to exercise 

 

66

 

such powers and perform such
duties as are expressly delegated to the Administrative Agent by the terms of
this Agreement and the other Loan Documents, together with such other powers as
are reasonably incidental thereto.  
Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent.

 

(b)           The Administrative Agent and
each Lender hereby irrevocably designates and appoints the Collateral Trustee
as its agent under the Collateral Trust Agreement and the other Loan Documents,
and irrevocably authorizes the Collateral Trustee, in such capacity, to (i) take
such action on its behalf under the provisions of the Collateral Trust
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to the Collateral Trustee by the terms
of the Collateral Trust Agreement and the other Loan Documents, together with
such other powers as are reasonably incidental thereto and (ii) enter into
any and all Security Documents and the Collateral Trust Agreement and such
other documents and instruments as shall be necessary to give effect to (A) the
ranking and priority of Indebtedness and other extensions of credit and
obligations contemplated by the Collateral Trust Agreement, (B) the
security interests in the Collateral purported to be created by the Security
Documents and (C) the other terms and conditions of the Collateral Trust
Agreement.   Each Lender further hereby
agrees to be bound by the terms of the Collateral Trust Agreement to the same
extent as if it were a party thereto and authorizes the Administrative Agent to
enter into the Collateral Trust Agreement on its behalf.   Notwithstanding any provision to the
contrary elsewhere in this Agreement, the Collateral Trustee shall not have any
duties or responsibilities, except those expressly set forth herein, in the
Collateral Trust Agreement or in any other Loan Document to which it is a
party, or any fiduciary relationship with the Administrative Agent or any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement, the Collateral
Trust Agreement or any other Loan Document or otherwise exist against the
Collateral Trustee.

 

8.2.          Delegation of Duties.  Each Agent may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties.  No
Agent shall be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.

 

8.3.          Exculpatory Provisions.  Neither any Agent nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or affiliates shall
be (i) liable for any action lawfully taken or omitted to be taken by it
or such Person under or in connection with this Agreement or any other Loan
Document (except to the extent that any of the foregoing resulted from its or
such Person’s own gross negligence or willful misconduct) or (ii) responsible
in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any Loan Party or any officer thereof
contained in this Agreement or any other Loan Document or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Agents under or in connection with, this Agreement or any other Loan
Document or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or for any failure
of any Loan Party a party thereto to perform its obligations hereunder or
thereunder.  The Agents shall not be
under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of any Loan Party.

 

8.4.          Reliance by Administrative Agent.  The Administrative Agent shall be entitled to
rely, and shall be fully protected in relying, upon any instrument, writing, resolution,
notice, consent, certificate, affidavit, letter, telecopy, telex or teletype
message, e-mail, statement, order or other document 

 

67

 

or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons and upon advice and statements of legal counsel
(including counsel to the Company), independent accountants and other experts
selected by the Administrative Agent. 
The Administrative Agent may deem and treat the payee of any Note as the
owner thereof for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent.  The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders (or, if so specified by this Agreement, all
Lenders or any other instructing group of Lenders specified in this Agreement)
as it deems appropriate or it shall first be indemnified to its satisfaction by
the Lenders against any and all liability and expense that may be incurred by
it by reason of taking or continuing to take any such action.  The Administrative Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this
Agreement and the other Loan Documents in accordance with a request of the
Required Lenders (or, if so specified by this Agreement, all Lenders or any
other instructing group of Lenders specified in this Agreement), and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders and all future holders of the Loans.

 

8.5.          Notice of Default.  The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default unless the Administrative Agent has received notice from a Lender or
the Company referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a “notice of default.”  In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall give notice thereof to
the Lenders.  The Administrative Agent
shall take such action with respect to such Default or Event of Default as
shall be reasonably directed by the Required Lenders (or, if so specified by
this Agreement, all Lenders or any other instructing group of Lenders specified
in this Agreement); provided that unless and until the Administrative
Agent shall have received such directions, the Administrative Agent may (but
shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it shall deem
advisable in the best interests of the Lenders.

 

8.6.          Non-Reliance on Agents and Other Lenders.  Each Lender expressly acknowledges that
neither of the Agents, the Syndication Agents nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or affiliates have
made any representations or warranties to it and that no act by any Agent or
any Syndication Agent hereafter taken, including any review of the affairs of a
Loan Party or any affiliate of a Loan Party, shall be deemed to constitute any
representation or warranty by any Agent or any Syndication Agent to any
Lender.  Each Lender represents to the
Agents and the Syndication Agents that it has, independently and without
reliance upon any Agent or any Syndication Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and
their affiliates and made its own decision to make its Loans and other
extensions of credit hereunder and enter into this Agreement.  Each Lender also represents that it will,
independently and without reliance upon any Agent or any Syndication Agent or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action under this Agreement and the other
Loan Documents, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property, financial and other condition
and creditworthiness of the Loan Parties and their affiliates.  Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of any Loan Party or any affiliate
of a Loan Party that may come into the 

 

68

 

possession of the
Administrative Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.

 

8.7.          Indemnification.  The Lenders agree to indemnify each Agent in
its capacity as such (to the extent not reimbursed by the Company and without
limiting the obligation of the Company to do so), ratably according to their
respective Aggregate Exposure Percentages in effect on the date on which
indemnification is sought under this Section (or, if indemnification is
sought after the date upon which the Commitments shall have terminated and the
Loans shall have been paid in full, ratably in accordance with such Aggregate
Exposure Percentages 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 shall survive the payment of the Loans and all
other amounts payable hereunder.

 

8.8.          Agent in Its Individual Capacity.  Each Agent and its affiliates may make loans to,
accept deposits from and generally engage in any kind of business with any Loan
Party as though such Agent were not an Agent. 
With respect to its Loans made or renewed by it, and any other extension
of credit made by it hereunder, each Agent shall have the same rights and
powers under this Agreement and the other Loan Documents as any Lender and may
exercise the same as though it were not an Agent, and the terms “Lender” and “Lenders”
shall include each Agent in its individual capacity.

 

8.9.          Successor Administrative Agent.  The Administrative Agent may resign as
Administrative Agent upon 30 days’ notice to the Lenders and the Company.  If the Administrative Agent shall resign as
Administrative Agent under this Agreement and the other Loan Documents, then
the Required Lenders shall appoint from among the Lenders a successor agent for
the Lenders, which successor agent shall (unless an Event of Default under Section 7(a) or
Section 7(e) with respect to the Company shall have occurred and be
continuing) be subject to approval by the Company (which approval shall not be
unreasonably withheld or delayed), whereupon such successor agent shall succeed
to the rights, powers and duties of the Administrative Agent, and the term “Administrative
Agent” shall mean such successor agent effective upon such appointment and
approval, and the former Administrative Agent’s rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Loans. 
If no successor agent has accepted appointment as Administrative Agent
by the date that is 30 days following a retiring Administrative Agent’s notice
of resignation, the retiring Administrative Agent may, on behalf of the Lenders
and with the consent of the Company (such consent not to be unreasonably
withheld and, which consent, shall not be required if an Event of Default under
Section 7(a) or Section 7(e) with respect to the Company
shall have occurred and be continuing), appoint a successor Administrative
Agent, which shall be a commercial bank organized or licensed under the laws of
the United States of America or of any State thereof and having a combined
capital and surplus of at least $500,000,000. 
Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent’s resignation as 

 

69

 

Administrative Agent, the
provisions of this Section 8 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Agreement and the other Loan Documents.

 

8.10.        Bookrunners, Lead Arrangers, Documentation Agents
and Syndication Agents.  None
of the Syndication Agents or any of the bookrunners, lead arrangers or
documentation agents identified on the cover page to this Agreement shall
have any duties or responsibilities under this Agreement and the other Loan
Documents in their respective capacities as such.

 

SECTION 9            MISCELLANEOUS

 

9.1.          Amendments and Waivers.  (a)  Neither this Agreement, any other
Loan Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 9.1 or
as otherwise expressly provided herein. 
The Required Lenders and the Company (on its own behalf and as agent on
behalf of any other Loan Party party to the relevant Loan Document) may, or,
with the written consent of the Required Lenders, the Administrative Agent and
the Company (on its own behalf and as agent on behalf of any Loan Party party
to the relevant Loan Document ) may, from time to time, (i) enter into
written amendments, supplements or modifications hereto and to the other Loan
Documents for the purpose of adding any provisions to this Agreement or the
other Loan Documents or changing in any manner the rights or obligations of the
Lenders or of the Loan Parties hereunder or thereunder or (ii) waive, on
such terms and conditions as the Required Lenders or the Administrative Agent,
as the case may be, may specify in such instrument, any of the requirements of
this Agreement or the other Loan Documents or any Default or Event of Default
and its consequences; provided, however, that no such waiver and
no such amendment, supplement or modification shall:

 

(i)            forgive or
reduce any principal amount or extend the final scheduled date of maturity of
any Loan or extend the scheduled date of or reduce the amount of any
amortization payment in respect of any Term Loan (for the purpose of clarity
each of the foregoing not to include any waiver of a mandatory prepayment),
reduce the stated rate of any interest, fee or prepayment premium payable
hereunder (except in connection with the waiver of applicability of any
post-default increase in interest rates), or extend the scheduled date of any
payment thereof, change the relative rights of the Secured Parties under the
Collateral Trust Agreement in respect of payments or Collateral, in each case
without the written consent of each Lender directly and adversely affected
thereby;

 

(ii)           eliminate or
reduce the voting rights of any Lender under this Section 9.1 without the
written consent of such Lender;

 

(iii)          reduce any
percentage specified in the definition of Required Lenders, consent to the
assignment or transfer by or release of the Company of any of its rights and
obligations under this Agreement and the other Loan Documents, release all or
substantially all of the Collateral or release all or substantially all of the
Subsidiary Guarantors or Holdings from their obligations under the Guarantee or
the Security Agreement (except as otherwise provided in the Loan Documents), in
each case without the written consent of all Lenders;

 

(iv)          amend, modify
or waive any provision of Section 8 in a manner adverse to the
Administrative Agent without the written consent of the Administrative Agent;
or

 

(v)           amend, modify
or waive any provision of Section 8 in a manner adverse to the Collateral
Trustee without the written consent of the Collateral Trustee;

 

70

 

Any such waiver and any such amendment,
supplement or modification shall apply equally to each of the Lenders and shall
be binding upon the Loan Parties, the Lenders, the Administrative Agent and all
future holders of the Loans.  In the case
of any waiver, the Loan Parties, the Lenders and the Administrative Agent shall
be restored to their former position and rights hereunder and under the other
Loan Documents, and any Default or Event of Default waived shall be deemed to
be cured and not continuing; but no such waiver shall extend to any subsequent
or other Default or Event of Default, or impair any right consequent thereon.

 

(b)           Subject to the foregoing
paragraph (a), without the consent of the Required Lenders, the Administrative
Agent and the Company may amend, modify or supplement any provision of this
Agreement or any other Loan Document (with, to the extent applicable, the
consent of the Collateral Trustee) to (A) cure any ambiguity, omission,
mistake, error, defect or inconsistency so long as such amendment, modification
or supplement does not adversely affect the rights or obligations of any Lender,
(B) provide additional Collateral for the Obligations and (c) to
permit additional affiliates of the Company to guarantee the Obligations and/or
provide Collateral therefor.

 

(c)           Notwithstanding the
foregoing, this Agreement may be amended with the written consent of the
Administrative Agent, the Company and each of the Lenders providing the
relevant Replacement Term Loans (as defined below) to permit the refinancing,
replacement or modification of all outstanding Term Loans (each, a “Replaced
Term Loan”) with one or more replacement term loan tranches hereunder
(each, a “Replacement Term Loan”), provided that (i) the aggregate
principal amount of such Replacement Term Loans shall not exceed the aggregate
principal amount of such Replaced Term Loans, (ii) the weighted average
life to maturity of such Replacement Term Loans shall not be shorter than the
weighted average life to maturity of such Replaced Term Loans at the time of
such refinancing and (iii) the Company shall have paid to the holders of
the Replaced Term Loans the prepayment premium, if any, that would be
applicable at the date of such refinancing, replacement or modification if such
Lender had received a prepayment on such date pursuant to Section 2.4.

 

9.2.          Notices.  All notices, requests and demands to or upon
the respective parties hereto to be effective shall be in writing (including by
telecopy or electronic transmission), and, unless otherwise expressly provided
herein, shall be deemed to have been duly given or made when delivered, or three
Business Days after being deposited in the mail, postage prepaid, or, in the
case of telecopy notice or electronic transmission or overnight or hand
delivery, when received, addressed as follows in the case of the Company and
the Administrative Agent, and as set forth in an administrative questionnaire
delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:

 

	
  Company:

  	
  Chrysler LLC

  1000 Chrysler Drive

  Auburn Hills, MI  48326

  
	
   

  	
  Attention: Holly Leese

  
	
   

  	
  CIMS 485-14-78

  
	
   

  	
  Telecopy: 248-512-1771

  
	
   

  	
  Telephone: 248-512-3984

  
	
   

  	
   

  
	
                   with a copy to:

  	
  Schulte Roth & Zabel LLP

  
	
   

  	
  919 Third Avenue

  
	
   

  	
  New York, NY  10022

  
	
   

  	
  Attention:  Marc Weingarten

  
	
   

  	
  Telecopy:     212-593-5955

  
	
   

  	
  Telephone:   212-756-2000

  

 

71

 

	
                   with a copy to:

  	
  CG Investor, LLC

  
	
   

  	
  c/o Cerberus Capital Management L.P.

  
	
   

  	
  New York, NY  10171

  
	
   

  	
  Attention:  Dev Kapadia and
  Robert Warden

  
	
   

  	
  Telecopy:     212-735-3009

  
	
   

  	
  Telephone:   212-891-2100

  
	
   

  	
   

  
	
  Administrative Agent for
  all notices:

  	
  JPMorgan Chase Bank, N.A. 

  Loan & Agency Services 

  1111 Fannin Street, 10th Floor 

  Houston, TX   77002

  
	
   

  	
  Attention:   Omar Jones

  
	
   

  	
  Telecopy:  713-750- 750-2938

  
	
   

  	
  Telephone:  713-750-7912

  
	
   

  	
   

  
	
                  
  with a copy to:

  	
  JPMorgan Chase Bank, N.A. 

  4 New York Plaza – 4th Floor 

  New York, NY   10004

  
	
   

  	
  Attention:  Freddy Luscher

  
	
   

  	
  Telecopy:  212-623-1310

  
	
   

  	
  Telephone:  212-623-7544

  

 

provided that any
notice, request or demand to or upon the Administrative Agent or the Lenders
shall not be effective until received.

 

Notices and other communications to the
Lenders hereunder may be delivered or furnished by electronic communications
pursuant to procedures approved by the Administrative Agent; provided
that the foregoing shall not apply to notices pursuant to Section 2 unless
otherwise agreed by the Administrative Agent and the applicable Lender.  The Administrative Agent or the Company may,
in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it; provided
that approval of such procedures may be limited to particular notices or
communications.

 

9.3.          No Waiver; Cumulative Remedies.  No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power
or privilege hereunder or thereunder preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges
herein provided are cumulative and not exclusive of any rights, remedies,
powers and privileges provided by law.

 

9.4.          Survival of Representations and Warranties.  All representations and warranties made
hereunder, in the other Loan Documents and in any document, certificate or
statement delivered pursuant hereto or in connection herewith shall survive the
execution and delivery of this Agreement and the making of the Loans and other
extensions of credit hereunder.

 

72

 

9.5.          Payment of Expenses.  The Company agrees (a) to pay or
reimburse the Agents, the Syndication Agents, Lead Arrangers and Bookrunners
for all their reasonable and documented respective costs and expenses incurred
in connection with the syndication of the Facility, (b) to pay or reimburse
the Agents for all reasonable costs and expenses incurred in connection with
the development, preparation and execution of, and any amendment, supplement or
modification to, this Agreement and the other Loan Documents and any other
documents prepared in connection herewith or therewith, the syndication of the
Facilities, the consummation and administration of the transactions
contemplated hereby and thereby and any amendment or waiver with respect
thereto, including, without limitation, (i) the reasonable fees and
disbursements of Simpson Thacher & Bartlett LLP and one local counsel
in each relevant jurisdiction (which, for the avoidance of doubt, may include
each jurisdiction where a Mortgaged Property is located) to be shared by the
Agents, the Syndication Agents, the Lead Arrangers and the Bookrunners, (ii) filing
and recording fees and expenses and (iii) the charges of Intralinks, (c) to
pay or reimburse the Administrative Agent, the Lenders and the Collateral
Trustee for all their out-of-pocket costs and expenses incurred in connection
with the enforcement or preservation of any rights under this Agreement and the
other Loan Documents, including the reasonable fees and disbursements of
counsel (including the allocated fees and expenses of in-house counsel) to each
Lender, the Administrative Agent and the Collateral Trustee, (d) to pay,
indemnify or reimburse each Lender and the Administrative Agent for, and hold
each Lender and the Administrative Agent harmless from, any and all recording
and filing fees and any and all liabilities with respect to, or resulting from
any delay in paying such fees, if any, that may be payable or determined to be
payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and (e) to
pay, indemnify or reimburse each Lender, the Agents, the Syndication Agents,
the Lead Arrangers, the Bookrunners their respective affiliates, and their
respective officers, directors, partners, employees, advisors, agents,
controlling persons and trustees (each, an “Indemnitee”) for, and hold
each Indemnitee harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever (other than with
respect to taxes not specifically provided for herein, which shall be governed
exclusively by Section 2.13 or with respect to the costs, losses or
expenses which are of the type covered by Section 2.12 or Section 2.14)
with respect to the execution, delivery, enforcement, performance and administration
of this Agreement, the other Loan Documents and any such other documents,
including, without limitation, any of the foregoing relating to the use of
proceeds of the Loans or the violation of, noncompliance with or liability
under, any Environmental Law applicable to the operations of any Group Member
or any of the Mortgaged Properties and the reasonable fees and expenses of
legal counsel in connection with claims, actions or proceedings by any
Indemnitee against any Loan Party under any Loan Document (all the foregoing in
this clause (e), collectively, the “Indemnified Liabilities”), provided,
that the Company shall have no obligation hereunder to any Indemnitee with
respect to Indemnified Liabilities to the extent such Indemnified Liabilities
resulted from the gross negligence or willful misconduct of, or material breach
of the Loan Documents, in each case as determined by a final and nonappealable
decision of a court of competent jurisdiction, by, such Indemnitee, any of its
affiliates or its or their respective officers, directors, partners, employees,
agents or controlling persons.  Without
limiting the foregoing, and to the extent permitted by applicable law, the
Company agrees not to assert and to cause its Subsidiaries not to assert, and
hereby waives and agrees to cause its Subsidiaries to waive, all rights for
contribution or any other rights of recovery with respect to all claims,
demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature, under or related to Environmental Laws,
that any of them might have by statute or otherwise against any Indemnitee
unless the same shall have resulted from the gross negligence or willful
misconduct of, or material breach of the Loan Documents, in each case as
determined by a final and nonappealable decision of a court of competent
jurisdiction, by, such Indemnitee, any of its affiliates or its or their
respective officers, directors, partners, employees, agents or controlling
persons.  All amounts due under this Section 9.5
shall be payable not later than 30 Business Days after the party to whom such

 

73

 

amount is owed has provided
a statement or invoice therefor, setting forth in reasonable detail, the amount
due and the relevant provision of this Section 9.5 under which such amount
is payable by the Company.  For purposes
of the preceding sentence, it is understood and agreed that the Company may ask
for reasonable supporting documentation to support any request to reimburse or
pay out-of-pocket expenses, legal fees and disbursements and that the grace
period to pay any such amounts shall not commence until such supporting
documentation has been received by the Company. 
Statements payable by the Company pursuant to this Section 9.5
shall be submitted the Company at the address of the Company set forth in Section 9.2,
or to such other Person or address as may be hereafter designated by the
Company in a written notice to the Administrative Agent.  The agreements in this Section 9.5 shall
survive repayment of the Loans and all other amounts payable hereunder.

 

9.6.          Successors and Assigns; Participations and Assignments.  (a) 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 (i) the
Company may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Company without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section.

 

(b)           (i)            Subject to the conditions
set forth in paragraph (b)(ii) below, any Lender may assign to one or more
assignees (each, an “Assignee”) all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitments and the
Loans at the time owing to it) with the prior written consent (in each case,
not to be unreasonably withheld or delayed) of:

 

(1)                                  the Company;
and

 

(2)                                  the
Administrative Agent;

 

provided, that none of
the foregoing consents in relation to any Term Loan shall be required for an
assignment to a Lender, an affiliate of a Lender, an Approved Fund of a Lender
or, in the case of the Company only, if an Event of Default pursuant to Section 7(a) or
7(e) has occurred and is continuing.

 

(ii)           Assignments shall be subject
to the following additional conditions:

 

(A)          except in the case of an
assignment to a Lender, an affiliate of a Lender or an Approved Fund or an
assignment of the entire remaining amount of the assigning Lender’s Commitments
or Loans under any Facility, the amount of the Commitments or 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) shall not be less than $1,000,000 unless each of the
Company and the Administrative Agent otherwise consent, provided that no
such consent of the Company shall be required if an Event of Default pursuant
to Section 7(a) or 7(e) has occurred and is continuing and
concurrent assignments to or by a Lender and its affiliates or Approved Funds,
shall be aggregated to determine compliance with this clause (A);

 

74

 

(B)           the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Assumption, together with a processing and recordation fee of $3,500; and

 

(C)           the Assignee, if it shall
not be a Lender, shall deliver to the Administrative Agent an administrative
questionnaire.

 

For the purposes of this Section 9.6, “Approved
Fund” means any Person (other than a natural person) that is engaged in
making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course and that is administered or managed by (x) a
Lender, (y) an affiliate of a Lender or (z) an entity or an affiliate
of an entity that administers or manages a Lender.

 

(iii)          Subject to
acceptance and recording thereof pursuant to paragraph (b)(iv) below,
from and after the effective date specified in each Assignment and Assumption
the Assignee thereunder shall be a party hereto 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 and obligations
of Sections 2.12, 2.13, 2.14 and 9.5). 
Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this Section 9.6 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 (c) of this
Section.

 

(iv)          The
Administrative Agent, acting for this purpose as an agent of the Company, shall
maintain at one of its offices 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 amount of and interest on
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, absent manifest error, and the Company, the
Administrative Agent and the Lenders may 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 Company and each Lender (with respect to any
entry relating to the Loans or Commitments of such Lender, at any reasonable
time and from time to time upon reasonable prior notice.

 

(v)           Upon its
receipt of a duly completed Assignment and Assumption executed by an assigning
Lender and an Assignee, the Assignee’s completed administrative questionnaire
(unless the Assignee shall already be a Lender hereunder), the processing and
recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall promptly accept such Assignment and
Assumption and record the information contained therein in the Register.  No assignment shall be effective for purposes
of this Agreement unless it has been recorded in the Register as provided in
this paragraph.

 

(c)           (i)            Any Lender may, without the
consent of the Company or the Administrative Agent, sell participations to one
or more banks or other entities (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement (including all or a
portion of its Commitments and the Loans owing to it); provided that (A) such
Lender’s obligations under this 

 

75

 

Agreement shall remain unchanged, (B) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (C) the Company, the Administrative Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under this
Agreement, and (D) no later than January 31 of each year, such Lender
shall provide the Company with a written description of each participation of
Loans and/or Commitments by such Lender during the prior year (it being
understood that any failure to provide notice shall not render the
participation invalid).  Any agreement
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement may provide that such Lender will not, without the consent
of the Participant, agree to any amendment, modification or waiver that (1) requires
the consent of each Lender directly affected thereby pursuant to the proviso to
the second sentence of Section 9.1(a)(i) and (2) directly
affects such Participant.  Subject to
paragraph (c)(ii) of this Section, the Company agrees that each
Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14
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, and subject
to paragraph (c)(ii) of this Section, each Participant also shall be
entitled to the benefits of Section 9.7(b) as though it were a
Lender, provided such Participant shall be subject to Section 9.7(a) as
though it were a Lender.  Notwithstanding
anything to the contrary in this Section 9.6, each Lender shall have the
right to sell one or more participations in all or any part of its Loans,
Commitments or other Obligations to one or more lenders or other Persons that
provide financing to such Lender in the form of sales and repurchases of
participations without having to satisfy the foregoing requirements.

 

(ii)           A Participant
shall not be entitled to receive any greater payment under Section 2.12 or
2.13 than the applicable Lender would have been entitled to receive with
respect to the participation sold to such Participant.  A Participant shall not be entitled to
receive any funds directly from the Company in respect of Sections 2.12, 2.13,
2.14 or 9.7 unless such Participant shall have provided to Administrative
Agent, acting for this purpose as an agent of the Company, such information as
is required to be recorded in the Register pursuant to paragraph (b)(iv) above
as if such Participant were a Lender. 
Any Participant shall not be entitled to the benefits of Section 2.13
unless such Participant complies with Section 2.13(d) and (e) as
though it were a Lender.

 

(d)           Any Lender may, without the
consent of the Company or the Administrative Agent, 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, and this Section shall
not apply to any such pledge or assignment of a security interest; provided
that no such pledge or assignment of a security interest shall release a Lender
from any of its obligations hereunder or substitute any such pledgee or
Assignee for such Lender as a party hereto.

 

(e)           The Company, upon receipt of
written notice from the relevant Lender, agrees to issue Notes to any Lender
requiring Notes to facilitate transactions of the type described in paragraph (d) above.

 

(f)            Notwithstanding the
foregoing, any Conduit Lender may assign any or all of the Loans it may have
funded hereunder to its designating Lender without the consent of the Company
or the Administrative Agent and without regard to the limitations set forth in Section 9.6(b) (other
than Section 9.6(b)(iv)).  Each of
the Company, each Lender and the Administrative Agent hereby confirms that it
will not institute against a Conduit Lender or join any other Person in
instituting against a Conduit Lender any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceeding under any state bankruptcy or
similar law, for one year and one day after the payment in full of the latest
maturing commercial paper note issued by such Conduit Lender; provided, however,
that each Lender designating any Conduit 

 

76

 

Lender hereby agrees to indemnify, save and
hold harmless each other party hereto for any loss, cost, damage or expense
arising out of its inability to institute such a proceeding against such
Conduit Lender during such period of forbearance.

 

9.7.          Adjustments; Set-off;.  (a)  Except to the extent that this
Agreement expressly provides for payments to be allocated to a particular
Lender or to the Lenders under a particular Facility, if any Lender (a “Benefitted
Lender”) shall, at any time after the Loans and other amounts payable
hereunder shall immediately become due and payable pursuant to Section 7,
receive any payment of all or part of the Obligations owing to it, or receive
any collateral in respect thereof (whether voluntarily or involuntarily, by
set-off, pursuant to events or proceedings of the nature referred to in Section 7(e),
or otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of the Obligations owing to
such other Lender, such Benefitted Lender shall purchase for cash in Dollars
from the other Lenders a participating interest in such portion of the
Obligations owing to each such other Lender, or shall provide such other
Lenders with the benefits of any such collateral, as shall be necessary to
cause such Benefitted Lender to share the excess payment or benefits of such
collateral ratably with each of the Lenders; provided, however,
that if all or any portion of such excess payment or benefits is thereafter
recovered from such Benefitted Lender, such purchase shall be rescinded, and
the purchase price and benefits returned, to the extent of such recovery, but
without interest.

 

(b)           In addition to any rights
and remedies of the Lenders provided by law, each Lender shall have the right
following the occurrence and during the continuance of an Event of Default,
without prior notice to the Company, any such notice being expressly waived by
the Company to the extent permitted by applicable law, upon all amounts owing
hereunder becoming due and payable (whether at the stated maturity, by
acceleration or otherwise), to set off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender or any branch or
agency thereof to or for the credit or the account of the Company.  Each Lender agrees promptly to notify the
Company and the Administrative Agent after any such setoff and application made
by such Lender; provided that the failure to give such notice shall not
affect the validity of such setoff and application.

 

9.8.          Counterparts.  This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts, and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument.  Delivery of an
executed signature page of this Agreement by facsimile or other electronic
transmission shall be effective as delivery of a manually executed counterpart
hereof.  A set of the copies of this Agreement
signed by all the parties shall be lodged with the Company and the
Administrative Agent.

 

9.9.          Severability.  Any provision of this Agreement that is held
to be prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating or rendering unenforceable the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

 

9.10.        Integration.  This Agreement and the other Loan Documents
represent the entire agreement of the Company, the Administrative Agent and the
Lenders with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to the subject matter hereof not expressly set
forth or 

 

77

 

referred to herein or in the
other Loan Documents (other than any Addendum executed and delivered on the
Closing Date).

 

9.11.        GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

9.12.        Submission to Jurisdiction; Waivers.  Each of the Administrative Agent, the Lenders
and the Company hereby irrevocably and unconditionally:

 

(a)           submits for
itself and its property in any legal action or proceeding relating to this
Agreement and the other Loan Documents to which it is a party, or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the County of New York,
State of New York, the courts of the United States for the Southern District of
New York, and appellate courts from any thereof;

 

(b)           consents that
any such action or proceeding may be brought in such courts and waives any
objection that it may now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or proceeding was brought in
an inconvenient court and agrees not to plead or claim the same; and

 

(c)           waives, to the
maximum extent not prohibited by law, any right it may have to claim or recover
in any legal action or proceeding referred to in this Section any special,
exemplary, punitive or consequential damages.

 

9.13.        Acknowledgements.  The Company hereby acknowledges that:

 

(a)           it has been
advised by counsel in the negotiation, execution and delivery of this Agreement
and the other Loan Documents;

 

(b)           no Agent nor
any Lender has any fiduciary relationship with or duty to the Company or any
Subsidiary arising out of or in connection with this Agreement or any of the
other Loan Documents, and the relationship between any Agent and the Lenders,
on one hand, and the Company or any Subsidiary, on the other hand, in
connection herewith or therewith is solely that of debtor and creditor; and

 

(c)           no joint
venture is created hereby or by the other Loan Documents or otherwise exists by
virtue of the transactions contemplated hereby among the Lenders or among the
Company or any Subsidiary and the Lenders.

 

9.14.        Releases of Guarantees and Liens.  (a)  Notwithstanding anything to the contrary
contained herein or in any other Loan Document, the Administrative Agent is
hereby irrevocably authorized by each Lender (without requirement of notice to
or consent of any Lender except as expressly required by Section 9.1) to
take, and the Administrative Agent hereby agrees to take promptly, any action
requested by the Company having the effect of releasing, or evidencing the
release of, any Collateral or Guarantee Obligations (including by instructing
the Collateral Trustee to do so) (i) to the extent necessary to permit
consummation of any transaction not prohibited by any Loan Document or that has
been consented to in accordance with Section 9.1 or (ii) under the
circumstances described in paragraph (b) below.  For the avoidance of doubt any such action
shall include directing the Collateral Trustee to take action under the
Collateral Trust Agreement.

 

78

 

(b)           At such time as the Loans
and interest and fees owing hereunder shall have been paid in full, the
Commitments have been terminated, the Obligations shall cease to be “Secured
Obligations” under the Security Documents and the Administrative Agent shall
provide notice to the Collateral Trustee thereof in accordance with Section 6.12(a) of
the Collateral Trust Agreement.

 

9.15.        Confidentiality.  Each of the Agents, the Syndication Agents,
the Lead Arrangers, the Bookrunners and each Lender agrees to keep confidential
all non-public information provided to it by any Loan Party, the Administrative
Agent or any Lender pursuant to or in connection with this Agreement; provided
that nothing herein shall prevent any Lender, the Agents, the Syndication
Agents, the Lead Arrangers or Bookrunners from disclosing any such information (a) to
the Administrative Agent or any other Lender or any Affiliates thereof,
provided that such information shall not be shared with any personnel of such
Affiliate which compete with or are in business units in the same line of
business as the Company, (b) subject to an agreement to comply with the
provisions of this Section (or other provisions at least as restrictive as
this Section), to any actual or prospective Transferee or any pledgee referred
to in Section 9.6(d) or any direct or indirect contractual
counterparty (or the professional advisors thereto) to any swap or derivative
transaction relating to the Company and its obligations, (c) to its
affiliates, employees, directors, trustees, agents, attorneys, accountants and
other professional advisors, or those of any of its affiliates for performing
the purposes of a Loan Document, subject to such Agent, Syndication Agent, Lead
Arranger or Bookrunner or Lender, as the case may be, advising such Person of
the confidentiality provisions contained herein, (d) upon the request or demand
of any Governmental Authority or regulatory agency (including self-regulated
agencies) having jurisdiction (or purporting to have jurisdiction) over it upon
notice (other than in connection with routine examinations or inspections by
regulators) to the Company thereof unless such notice is prohibited or the
Governmental Authority or regulatory agency shall require otherwise, (e) in
response to any order of any court or other Governmental Authority or as may
otherwise be required pursuant to any Requirement of Law, after notice to the
Company if reasonably feasible, (f) if requested or required to do so in
connection with any litigation or similar proceeding, after notice to the
Company if reasonably feasible, (g) that has been publicly disclosed, other
than in breach of this Section, (h) to the National Association of
Insurance Commissioners or any similar organization or any nationally
recognized rating agency that requires access to information about a Lender’s
investment portfolio in connection with ratings issued with respect to such
Lender, or (i) in connection with the exercise of any remedy hereunder or
under any other Loan Document.

 

9.16.        WAIVERS OF JURY TRIAL.  THE COMPANY, THE ADMINISTRATIVE AGENT AND THE
LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND
FOR ANY COUNTERCLAIM THEREIN.

 

9.17.        USA Patriot Act.  Each Lender hereby notifies the Company that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the “USA Patriot Act”),
it is required to obtain, verify and record information that identifies each
Loan Party, which information includes the name and address of each Loan Party
and other information that will allow such Lender to identify each Loan Party
in accordance with the USA Patriot Act.

 

79

 

 

Signature Page to

Credit Agreement

 

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

 

	
   

  	
  CARCO
  INTERMEDIATE HOLDCO II LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  CarCo
  International HoldCo I LLC,

  
	
   

  	
   

  	
  its
  managing member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Chrysler
  Holdings LLC,

  
	
   

  	
   

  	
  its
  managing member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Seth Plattus

  
	
   

  	
   

  	
  Name:
  Seth Plattus

  
	
   

  	
   

  	
  Title:    Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Thomas W. LaSorda

  
	
   

  	
   

  	
  Name:
  Thomas W. LaSorda

  
	
   

  	
   

  	
  Title:    President and Chief Executive
  Officer

  

 

 

	
   

  	
  JPMORGAN CHASE BANK, N.A., as Administrative

  Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Richard W. Duker

  
	
   

  	
   

  	
  Name:

  	
  RICHARD
  W. DUKER

  
	
   

  	
   

  	
  Title:

  	
  MANAGING
  DIRECTOR

  

 

 

	
   

  	
  CITIBANK, N.A., as Syndication Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Aaron
  Dannenberg

  
	
   

  	
   

  	
  Name:

  	
  Aaron
  Dannenberg

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  

 

OpCo Second Lien Credit Agreement

 

 

	
   

  	
  GOLDMAN SACHS CREDIT PARTNERS L.P., as

  Syndication Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Bruce H. Mendelsohn

  
	
   

  	
   

  	
  Name:

  	
  BRUCE
  H. MENDELSOHN

  
	
   

  	
   

  	
  Title:

  	
  AUTHORIZED
  SIGNATORY

  

 

OpCo Second Lien Credit Agreement

 

 

 

 

 

LENDER ADDENDUM

 

Upon execution and delivery of this Addendum
(this “Agreement”) and its acceptance by the Company and the
Administrative Agent, the undersigned agrees to all of the provisions of the Second
Lien Term Loan Agreement, dated as of August 3, 2007, among CARCO
INTERMEDIATE HOLDCO II LLC, a Delaware limited liability company (“Holdings”),
CHRYSLER LLC, a Delaware limited liability company (the “Company”), the
several banks and other financial institutions or entities from time to time
party thereto, JPMORGAN CHASE BANK, N.A., as administrative agent and the other
agents party thereto (as the same may from time to time be amended, modified or
otherwise supplemented, the “Credit Agreement”). Unless otherwise
defined herein, terms defined in the Credit Agreement and used herein shall
have the meanings given to them in the Credit Agreement. In furtherance of the
foregoing, effective on the Closing Date, this Agreement shall constitute on
the part of the undersigned a signature page to the Credit Agreement and the
undersigned shall, effective on the Closing Date, be a party to the Credit
Agreement and have the rights and obligations of (and shall be) a Lender under
the other Loan Documents with a Term Commitment in the amount set forth below:

 

Term Commitment:               $1,500,000,000

 

This Agreement hereby confirms that the notice and account information
with respect to the undersigned Lender for purposes of Section 9.2 of the
Credit Agreement is as set forth below:

 

1.   Name
of Lender:                             DAIMLERCHRYSLER
NORTH AMERICA FINANCE CORPORATION

 

2.   Address
for Notices (with email address):

 

3.   Facsimile
Number:

 

4.   Administrative
Contact (with email address):

 

5.   Clearing
Account Number:

 

OpCo Second Lien Lender Addendum

 

 

 

 

DAIMLERCHRYSLER NORTH
AMERICA FINANCE CORPORATION

 

	
  By:

  	
  /s/ [illegible]

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
				

 

	
  By:

  	
  /s/ [illegible]

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
				

 

August 3, 2007

 

 

Agreed and
accepted:

CHRYSLER LLC

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
				

 

August 3, 2007

 

 

Agreed and
accepted:

JPMORGAN CHASE BANK, N.A., as Administrative Agent

 

	
  By:

  	
  /s/ Bruce S.
  Borden

  	
   

  
	
  Name:

  	
  Bruce S. Borden

  	
   

  
	
  Title:

  	
  Executive
  Director

  	
   

  
				

 

August 3, 2007

 

OpCo Second Lien Lender Addendum

 

 

 

 

DAIMLERCHRYSLER
NORTH AMERICA FINANCE CORPORATION

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
				

 

August 3, 2007

 

 

Agreed and
accepted:

CHRYSLER LLC

 

	
  By:

  	
  /s/ Timothy P
  Dykstra

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
				

 

August 3, 2007

 

 

Agreed and
accepted:

JPMORGAN CHASE BANK, N.A., as Administrative Agent

 

	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
				

 

August 3, 2007

 

OpCo Second Lien Lender Addendum

 

 

EXECUTION VERSION

 

FIRST OMNIBUS AMENDMENT

 

THIS FIRST OMNIBUS AMENDMENT, dated as of September 28, 2007 (this
“First Amendment”), to (i) the First Lien Credit Agreement, dated
as of August 3, 2007, (the “First Lien Credit Agreement”), among Carco
Intermediate Holdco II LLC, a Delaware limited liability company (“Holdings”),
Chrysler LLC, a Delaware limited liability company (the “Company”), the
several banks and other financial institutions or entities from time to time
parties thereto (the “First Lien Lenders”), Goldman Sachs Credit
Partners L.P., and Citibank, N.A., as syndication agents (in such capacity, the
“Syndication Agents”), and JPMorgan Chase Bank, N.A., as administrative
agent (in such capacity the “Administrative Agent”), (ii) the Second
Lien Credit Agreement, dated as of August 3, 2007, (the “Second Lien
Credit Agreement”), among Holdings, the Company, the several banks and
other financial institutions or entities from time to time parties thereto (the
“Second Lien Lenders”, and together with the First Lien Lenders, the “Lenders”),
the Syndication Agents, and the Administrative Agent, (iii) the Collateral
Trust Agreement, dated as of August 3, 2007  (the “OpCo Collateral Trust Agreement”),
among Holdings, the
Company, the subsidiaries of the Company from time to time parties thereto
(together with Holdings and the Company, the “CTA Grantors”), JPMorgan
Chase Bank, N.A., as First Priority Agent (as defined in the OpCo Collateral
Trust Agreement), JPMorgan Chase Bank, N.A., as Second Priority Agent (as
defined in the OpCo Collateral Trust Agreement), and Wilmington Trust Company,
a Delaware corporation, as collateral trustee (together with any successors,
the “Collateral Trustee”) and (iv) the Security Agreement,
dated as of August 3, 2007 (the “OpCo Security Agreement”, and together
with the First Lien Credit Agreement, the Second Lien Credit Agreement and the OpCo
Collateral Trust Agreement, each an “OpCo Agreement” and collectively,
the “OpCo Agreements”), among Holdings, the Company and each of the other
signatories party thereto (Holdings, the Company and such signatories, together
with any other entity that may become a party thereto as provided therein, are
hereinafter referred to collectively as the “Security Grantors”), in
favor of the Collateral Trustee.

 

W  I  T  N  E  S  S  E  T  H:

 

WHEREAS, the Company has
requested that the Administrative Agent and the Collateral Trustee agree to
amend certain provisions of the OpCo Agreements as herein set forth;

 

WHEREAS, the Company and the
Administrative Agent have determined that such changes are technical and
ministerial and do not adversely affect the rights or obligations of any Lender
in accordance with Section 9.1 of the First Lien Credit Agreement and the
Second Lien Credit Agreement; and

 

WHEREAS, the Administrative
Agent and the Collateral Trustee have consented to such amendments on the terms
and conditions contained herein;

 

NOW,
THEREFORE, the parties hereto hereby agree as follows:

 

SECTION 1.           DEFINITIONS

 

1.1           Defined Terms.  Unless otherwise defined herein, capitalized
terms which are defined in the applicable OpCo Agreement are used herein as
therein defined.

 

 

SECTION 2.           AMENDMENTS TO THE FIRST LIEN
CREDIT AGREEMENT

 

2.1           Amendment to Section 1.1
(Definitions).  Section 1.1
of the First Lien Credit Agreement is hereby amended by amending and
restating clause (iii) of the definition of “Collateral”, so that it
provides as follows:

 

“(iii) the proceeds of any tax
refund received by the Company and payable to DaimlerChrysler AG or any of its
Affiliates pursuant to the terms of Section 7.01(a)(ii) or Section 7.02(a) of
the Acquisition Agreement”.

 

2.2           Amendment to Sections 6.6 (Restricted
Payments).   Section 6.6 of the First Lien Credit
Agreement is hereby amended by amending and restating clause (j) in its
entirety, so that it provides as follows:

 

“(j) the Company may make payments, to
any Parent Entity (to enable such Person to make distributions) or pay directly
to DaimlerChrysler AG (or any of its Affiliates), with the proceeds of any tax
refund received or which reduced
amounts otherwise payable by the Company or any Subsidiary in connection with any taxes paid by the Company, any Subsidiary or any predecessor (for
purposes of such tax refund) of the Company or such Subsidiary in
respect of any period or portion of any
period ending on or prior to the Closing Date, to the extent such tax
refunds are to be shared with or paid
to DaimlerChrysler AG (or any of
its Affiliates) pursuant to the terms of Section 7.01(a)(ii) or Section 7.02(a) of the
Acquisition Agreement.”

 

2.3           Amendment to Section 9.1 (Amendments and
Waivers).  Section 9.1(a) of
the First Lien Credit Agreement is hereby amended by deleting the term “or” at
the end of clause (iv), replacing the semi-colon at the end of clause (v) with
“; or” and adding a new clause (vi) as follows:

 

“(vi) amend, supplement, modify or waive
Section 6.16(a) without the consent of Lenders holding at
least 66% of the outstanding Term Loans.”

 

SECTION 3.           AMENDMENTS TO THE SECOND LIEN CREDIT AGREEMENT

 

3.1           Amendment to Section 1.1
(Definitions).  Section 1.1
of the Second Lien Credit Agreement is hereby amended by amending and
restating clause (iii) of the definition of “Collateral”, so that it
provides as follows:

 

“(iii) the proceeds of any tax
refund received by the Company and payable to DaimlerChrysler AG or any of its
Affiliates pursuant to the terms of Section 7.01(a)(ii) or Section 7.02(a) of
the Acquisition Agreement”.

 

3.2           Amendment to Sections 6.6
(Restricted Payments).   Section 6.6
of the Second Lien Credit Agreement is hereby amended by amending and restating
clause (j) in its entirety, so that it provides as follows:

 

“(j) the Company may make payments, to
any Parent Entity (to enable such Person to make distributions) or pay directly
to DaimlerChrysler AG (or any of its Affiliates), with the proceeds of any tax
refund received or which reduced
amounts otherwise payable by the Company or any Subsidiary in connection with any taxes paid by the Company, any Subsidiary or any predecessor (for
purposes of such tax refund) of the Company or such 

 

2

 

Subsidiary in respect of
any period or portion of any period
ending on or prior to the Closing Date, to the extent such tax refunds
are to be shared with or paid to
DaimlerChrysler AG (or any of its
Affiliates) pursuant to the terms of Section 7.01(a)(ii) or Section 7.02(a) of the
Acquisition Agreement.”

 

3.3           Amendment to Section 9.1 (Amendments and
Waivers).  Section 9.1(a) of
the Second Lien Credit Agreement is hereby amended by deleting the term “or” at
the end of clause (iv), replacing the semi-colon at the end of clause (v) with
“; or” and adding a new clause (vi) as follows:

 

“(vi) amend, supplement, modify or waive
Section 6.16(a) without the consent of Lenders holding at
least 66% of the outstanding Term Loans.”

 

SECTION 4.                                AMENDMENT TO
THE OPCO COLLATERAL TRUST AGREEMENT

 

4.1           Amendment to Section 3.4
(Application of Moneys).  Section 3.4
of the OpCo Collateral Trust Agreement is hereby amended by amending and
restating the “Fourth” section of clause (b) as follows:

 

“FOURTH: to the holders of First Priority Secured Obligations in
an amount equal to the unpaid principal and unpaid interest on and premium and
other charges, if any, with respect to the Tranche 1 Term Loans that are First
Priority Secured Obligations, termination amounts in respect of Designated
Hedging Obligations that constitute Permitted First Lien Non-Loan Exposure,
amounts due in respect of Designated Cash Management Obligations that constitute
Permitted First Lien Non-Loan Exposure, amounts due in respect of reimbursement
obligations in respect of letters of credit and bank guarantees that constitute
Permitted First Lien Non-Loan Exposure, and interest and fees thereon, in each
case to the extent the same are due and payable, as of such Distribution Date,
and, if such moneys shall be insufficient to pay such amounts in full, then
ratably to such holders in proportion to the unpaid amounts thereof on such
Distribution Date;”.

 

SECTION 5.           AMENDMENT TO THE OPCO SECURITY AGREEMENT

 

5.1           Amendment to Section 1.1
(Definitions).  Section 1.1
of the OpCo Security Agreement is hereby amended by amending and
restating clause (iii) of the definition of “Excluded Property” as
follows:

 

“(iii) the proceeds of
any tax refund received by the Company and payable to DaimlerChrysler AG or any
of its Affiliates pursuant to the terms of Section 7.01(a)(ii) or Section 7.02(a) of
the Acquisition Agreement,”.

 

SECTION 6.           MISCELLANEOUS

 

6.1           Representations and Warranties.  Each Loan Party (as defined in the First Lien
Credit Agreement) hereby represents and warrants that, on the date hereof after
giving effect to the provisions of this First Amendment, (a) each of the
representations and warranties made by any Loan Party in the OpCo Agreements are
true and correct in all material respects on and as of the date hereof as 

 

3

 

if made on and as of such date, except to the extent such
representations and warranties expressly relate to a particular date, in which
case such representations and warranties were true and correct in all material
respects as of such date and (b) no Default or Event of Default (each as
defined in the First Lien Credit Agreement or the Second Lien Credit Agreement,
as applicable) has occurred and is continuing.

 

6.2           Effectiveness.  This First Amendment shall become effective
on the date on which the Administrative Agent shall have received this First Amendment
executed and delivered by the Administrative Agent, the Collateral Trustee
(with respect to Sections 4 and 5 only) and the Loan Parties a party to each of
the OpCo Agreements.

 

6.3           Continuing Effect of the OpCo
Agreements.  This First Amendment
shall not constitute an amendment of any other provisions of the OpCo Agreements
not expressly referred to herein and shall not be construed as a waiver or
consent to any further or future action on the part of any Loan Party that
would require the consent of the Lenders or the Administrative Agent.  Except as expressly amended hereby, the
provisions each of the OpCo Agreements are and shall remain in full force and
effect.

 

6.4           Counterparts.  This First Amendment may be executed by the
parties hereto in any number of separate counterparts (including facsimiled or
electronic PDF counterparts), each of which shall be deemed to be an original,
and all of which taken together shall be deemed to constitute one and the same
instrument.

 

6.5           Expenses.  Each of the Loan Parties agrees to pay or
reimburse the Administrative Agent and the Collateral Trustee for all of their
reasonable out-of-pocket costs and expenses incurred in connection with the
preparation, negotiation and execution of this First Amendment, including,
without limitation, the fees and disbursements of counsel to the Agents.

 

6.6           Limited Effect.  Except as expressly modified by this
Amendment, each of the OpCo Agreements and the other Loan Documents are
ratified and confirmed and are, and shall continue to be, in full force and
effect in accordance with their respective terms.  Each Loan Party acknowledges and agrees that
such Loan Party is truly and justly indebted to the Lenders and the
Administrative Agent for the Obligations, without defense, counterclaim or offset
of any kind, other than as provided in the Loan Documents, and such Loan Party
ratifies and reaffirms the validity, enforceability and binding nature of such
Obligations. The Company acknowledges and agrees that nothing in this Amendment
shall constitute an indication of the Lenders’ willingness to consent to any
other amendment or waiver of any other provision of any of the OpCo Agreements
or a waiver of any Default or Event of Default.

 

6.7           Loan Document.  This Amendment is a Loan Document executed
pursuant to each of the OpCo Agreements and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions of the OpCo Agreements.

 

6.8           GOVERNING LAW.  THIS FIRST AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.

 

[Remainder of the page intentionally
left blank]

 

4

 

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

 

	
   

  	
  CARCO
  INTERMEDIATE HOLDO II LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Carco
  International Holdco I LLC, its managing 

  member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Chrysler
  Holdings LLC, its managing member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Seth Plattus

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER,
  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  

 

[Signature page to the First Amendment]

 

 

	
   

  	
  CHRYSLER
  INTERNATIONAL LIMITED L.L.C.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  REALTY COMPANY LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  DE VENEZUELA LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  MOTORS LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  VANS LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GLOBAL
  ELECTRIC MOTORCARS, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  

 

[Signature page to the First Amendment]

 

 

	
   

  	
  NEV
  SERVICE, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  TECHNOLOGIES MIDDLE EAST LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  INTERNATIONAL CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  SERVICE CONTRACTS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  SERVICE CONTRACTS FLORIDA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  AVIATION INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  

 

[Signature page to the First Amendment]

 

 

	
   

  	
  CHRYSLER
  TRANSPORT INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  DCC
  929, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  DEALER
  CAPITAL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHRYSLER
  INTERNATIONAL SERVICES S.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  NEV
  MOBILE SERVICE, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
  TPF
  ASSETS, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  

 

[Signature page to the First Amendment]

 

 

	
   

  	
  TPF
  NOTE, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  UTILITY
  ASSETS LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Timothy P Dykstra

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:
  

  

 

[Signature page to the First Amendment]

 

 

	
   

  	
  WILMINGTON
  TRUST COMPANY, as Collateral 

  Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:
  

  
	
   

  	
   

  	
  Title:    

  

 

[Signature page to the First Amendment]

 

 

	
   

  	
  JPMORGAN
  CHASE BANK, N.A., as

  Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Richard W. Duker

  
	
   

  	
   

  	
  Name:
  RICHARD W. DUKER

  
	
   

  	
   

  	
  Title:    MANAGING DIRECTOR

  

 

[Signature page to the First Amendment]

 

 

EXECUTION
VERSION

 

SECOND
AMENDMENT

 

THIS SECOND AMENDMENT, dated as of November 29,
2007 (this “Second Amendment”), to the Second Lien Credit Agreement,
dated as of August 3, 2007, (as amended by the First Amendment thereto,
the “Credit Agreement”), among Carco Intermediate Holdco II LLC, a
Delaware limited liability company (“Holdings”), Chrysler LLC, a
Delaware limited liability company (the “Company”), the several banks
and other financial institutions or entities from time to time parties thereto
(the “Lenders”), Goldman Sachs Credit Partners L.P., and Citibank, N.A.,
as syndication agents (in such capacity, the “Syndication Agents”), and
JPMorgan Chase Bank, N.A., as administrative agent (in such capacity the “Administrative
Agent).

 

W  I  T  N  E  S  S  E  T  H:

 

WHEREAS,
the Company, Holdings, the Lenders and the Administrative Agent are parties to
the Credit Agreement;

 

WHEREAS,
the Company has requested that the Lenders agrees to make certain amendment
relating to the Credit Agreement as set forth herein; and

 

WHEREAS,
the Lenders are willing to agree to such amendments, in each case, subject to
the terms and conditions set forth herein.

 

NOW, THEREFORE, the parties hereto hereby agree as
follows:

 

SECTION 1.           DEFINITIONS

 

1.1           Unless
otherwise defined herein, capitalized terms which are defined in the Credit Agreement
are used herein as therein defined.

 

1.2           The
definitions of the following terms set forth in Section 1.1 of the Credit
Agreement are hereby amended to read in full as follows:

 

“Reinvestment Event”: any Asset Sale, Recovery Event or
incurrence of certain Permitted Indebtedness in respect of which the Company
has delivered a Reinvestment Notice.

 

“Reinvestment Notice”:  a
written notice executed by a Responsible Officer stating that no Event of Default
has occurred and is continuing and that the Company (directly or indirectly
through a Subsidiary) intends and expects to use all or a specified portion of
the Net Cash Proceeds of an Asset Sale or Recovery Event or of Permitted
Indebtedness incurred pursuant to clause (v) of the definition thereof, to
acquire or repair assets useful in its business.

 

1.3           The
definitions of the following terms set forth in Section 1.1 of the Credit
Agreement are hereby amended as follows:

 

(a)           clause (iv) of
the definition of “Collateral” shall be amended to read in its entirety as
follows:

 

                                                “(iv) any
cash, Cash Equivalents or Temporary Cash Investments in an aggregate amount not
to exceed $1,500,000,000 maintained in a segregated deposit or 

 

 

securities account, to the extent such cash, Cash Equivalents and
Temporary Cash Investments have been pledged to FinCo to secure obligations of
the Company under the Master Agreement (other than, for the avoidance of doubt,
any reversionary rights of a Loan Party thereto), and”;

 

(b)           “$10,000,000,000” in
clause (b) of the definition of “Permitted Indebtedness” shall be replaced
with “$8,500,000,000”;

 

(c)           the word “and” shall
be deleted at the end of clause (t) and replaced with “;” and the period
at the end of clause (u) shall be deleted and replaced with “;” in the
definition of “Permitted Indebtedness”, and new clauses (v) and (w) shall
be added as follows:

 

“(v)         Indebtedness
of the Company and its Subsidiaries secured by (i) real property and
improvements consisting of current and former dealership properties and
property acquired for development as dealership properties, (ii) the real
property and improvements comprising the Chelsea proving grounds located in
Chelsea, Michigan, (iii) real property and improvements listed on Schedule
6.5, or with the consent of the Administrative Agent, other real property and
improvements, or (iv) Capital Stock of Real Estate Subsidiaries, in an
aggregate outstanding principal amount at any time for all Indebtedness
incurred pursuant to this clause (v) not to exceed $500,000,000, and in
each case which real property, improvements or Capital Stock shall be removed
from the Borrowing Base (to the extent included) upon the incurrence of such
Indebtedness; provided, however, that the Indebtedness described
in this clause (v) may only be incurred to the extent that, after giving
pro forma effect to the release of Liens on Collateral in connection with such
Indebtedness, the Borrowing Base exceeds the Outstanding Amount of Covered
Debt; and

 

(w)          Indebtedness
of Chrysler Motors LLC or the MOPAR Subsidiary secured by inventory of its
aftermarket and replacement parts business conducted by its MOPAR division, and
by the proceeds thereof, and/or by the Capital Stock of the MOPAR Subsidiary
and in each case, which inventory, proceeds or Capital Stock shall be removed
(to the extent included) from the Borrowing Base upon the incurrence of such
Indebtedness; provided, however, that the Indebtedness described
in this clause (w) may only be incurred to the extent that, after giving
pro forma effect to the release of Liens on Collateral in connection with such
Indebtedness, the Borrowing Base exceeds the Outstanding Amount of Covered
Debt.”;

 

(d)           “$2,000,000,000” in
clause (r) of the definition of “Permitted Liens” shall be replaced with “$1,500,000,000”,
the word “and” shall be deleted at the end of clause (v) and replaced with
“;” and the “;” at the end of clause (w) shall be deleted and replaced
with “; and”,  and new clause (x) shall
be added as follows:

 

“(x)          Liens
securing Indebtedness permitted by clauses (v) and (w) of the
definition of Permitted Indebtedness; provided that in each case such Liens do
not encumber any property (except substitutions, replacements and proceeds
thereof) other than the property described in the applicable clause as securing
such Indebtedness, provided that if the Administrative Agent has determined
that an intercreditor agreement or arrangement is required in accordance with Section 9.14(c),
such intercreditor agreement or arrangement is in place.”; and

 

2

 

(e)           clause (g) of
the definition of “Temporary Cash Investments” shall be amended to read in its
entirety as follows:

 

“(g)         Investments
in any foreign equivalents of the securities described in clauses (a) through
(d) or (f) above, provided that such investments may be made in
countries which have a country rating of less than “A” by nationally recognized
rating agencies through an in-country bank or trust company which has capital,
surplus and undivided profits aggregating in excess of $100.0 million (or the
foreign currency equivalent thereof) and which has outstanding debt rated at
least the equivalent of the country rating; and”.

 

1.4           The
definitions of the following terms shall be added to Section 1.1 as
follows in alphabetical order:

 

“MOPAR Financing Amount”: in connection with the incurrence of
Indebtedness permitted pursuant to clause (w) of the definition of
Permitted Indebtedness, an amount equal to any initial advance under any such
financing, (the “Initial Advance”) and an amount equal to any subsequent
advances which increase the Indebtedness outstanding under such financing above
the Initial Advance.

 

“MOPAR Subsidiary”:  a
subsidiary of the Company which will undertake the financing of inventory of
Chrysler Motors LLC’s aftermarket and replacement parts business and incur
Indebtedness permitted pursuant to clause (w) of the definition of
Permitted Indebtedness, substantially all of the assets of which consist of
such inventory and the proceeds thereof.

 

“Real Estate Subsidiary”:  a subsidiary of the Company which will
undertake the financing of real estate and improvements and incur Indebtedness
permitted pursuant to clause (v) of the definition of Permitted Indebtedness,
substantially all of the assets of which consist of the real estate and
improvements so financed.

 

1.5           The
definition of “Available Liquidity” set forth in Section 1.1 of the Credit
Agreement is hereby deleted in its entirety.

 

SECTION 2.           AMENDMENTS

 

2.1           Amendment
to Section 2.5 (Mandatory Prepayments).

 

(a)           Section 2.5(a)(i)(A) of
the Credit Agreement is hereby amended to read in its entirety as follows:

 

“(A)  any Indebtedness shall be incurred
by any Group Member (excluding any Permitted Indebtedness but including
Indebtedness incurred pursuant to clauses (v) (the terms of which shall be
governed by Section 2.5(a)(ii)) or (w) of the definition of Permitted
Indebtedness), an amount equal to 100% (or, in respect of Indebtedness incurred
pursuant to clause (w) of the definition of Permitted Indebtedness, an
amount equal to the greater of (i) 70% of the MOPAR Financing Amount or (ii) the
amount deducted from the Borrowing Base in connection with the incurrence of
such Indebtedness) of the Net Cash Proceeds 

 

3

 

thereof shall be applied on the date of such
incurrence toward the prepayment of the Term Loans as set forth in Sections 2.5(b) and
2.11(b), or”

 

(b)           Section 2.5(a)(ii) of
the Credit Agreement is hereby amended to read in its entirety as follows:

 

“(ii)         If
on any date any Group Member shall receive Net Cash Proceeds from any Asset
Sale that are required to be applied as a Mandatory Prepayment pursuant to Section 6.5,
in respect of a Recovery Event, or of Indebtedness incurred pursuant to clause (v) of
the definition of Permitted Indebtedness, then, unless a Reinvestment Notice
shall be delivered in respect thereof, an amount equal to such Net Cash
Proceeds shall be applied promptly, and in any event not later than five
Business Days after the date of receipt by such Group Member of such Net Cash
Proceeds, toward the prepayment of the Term Loans as set forth in Sections 2.5(b) and
2.11(b); provided, that, notwithstanding the foregoing on each Reinvestment Prepayment
Date, an amount equal to the Reinvestment Prepayment Amount with respect to the
relevant Reinvestment Event shall be applied toward the prepayment of the Term
Loans as set forth in Sections 2.5(b) and 2.11(d).”

 

2.2           Amendment
to Section 2.11 (Pro Rata Treatment and Payments; Evidence of Debt).  Section 2.11(b) of the Credit
Agreement is hereby amended by adding the following proviso at the end of
clause (d):

 

“, provided that, no such prepayment premium shall be payable in
respect of any prepayment made pursuant to Section 2.5 solely as a result
of the incurrence of Indebtedness permitted pursuant to clauses (v) and (w) of
the definition of Permitted Indebtedness.”

 

2.3           Amendment
to Section 5.3 (Compliance and Other Information). Section 5.3(b)(ii) of
the Credit Agreement is hereby amended by inserting the word “and” immediately
prior to clause (y) and deleting the following from the end of such
section:

 

“and (z) a calculation of Available
Liquidity as of the last day of the fiscal period covered by such financial
statements”.

 

2.4           Amendment
to Section 5.7 (Additional Collateral, etc.).  Section 5.7(a) of the Credit
Agreement is hereby amended by adding a new sentence to the end thereof as
follows:

 

“The foregoing provisions of
this Section 5.7(a), shall not apply to the MOPAR Subsidiary or a Real
Estate Subsidiary to the extent that, and for so long as, the taking of any
such action with respect to the MOPAR Subsidiary or Real Estate Subsidiary, as
the case may be, is prohibited by the provisions of any financing permitted by
clause (w) (in the case of the MOPAR Subsidiary) or (v) (in the case
of a Real Estate Subsidiary) of the definition of Permitted Indebtedness (it
being understood that upon the expiration of any such prohibition the Company
will promptly comply with such provisions as if they had first become
applicable upon the expiration thereof).”

 

2.5           Amendment
to Section 6.2 (Available Liquidity). 
Section 6.2 of the Credit Agreement is hereby amended by deleting
it in its entirety and inserting in place thereof “Intentionally Deleted.”.

 

4

 

2.6           Amendment
to Section 6.5 (Asset Sale Restrictions).  Section 6.5(j) of the Credit
Agreement is hereby amended to read in its entirety as follows:

 

“(j)          (i) any Disposition required by the terms of any
Permitted Transaction and made in accordance with such terms, (ii) any
Disposition of aftermarket and replacement parts inventory of the MOPAR
division of Chrysler Motors LLC to the MOPAR Subsidiary in connection with any
financing permitted by clause (w) of the definition of Permitted
Indebtedness, or (iii) any Disposition of real estate and improvements to
a Real Estate Subsidiary in connection with any financing permitted by clause (v) of
the definition of Permitted Indebtedness;”

 

2.7           Amendment
to Section 6.8 (Negative Pledge). 
Section 6.8 of the Credit Agreement is hereby amended by deleting
the word “and” immediately prior to clause (c) of such section and adding
new clauses (d) and (e) immediately prior to the period at the end of
such section to read in its entirety as follows:

 

“, (d) any agreements restricting Liens on the
aftermarket and replacement parts inventory of the MOPAR division of Chrysler
Motors LLC and the proceeds thereof or on the assets of the MOPAR Subsidiary
and the proceeds thereof or on the Capital Stock of the MOPAR Subsidiary
pursuant to any financing permitted by clause (w) of the definition of
Permitted Indebtedness, and (e) any agreements restricting Liens on real
estate and improvements subject to a Lien permitted under clause (x) of
the definition of Permitted Liens or on the assets of a Real Estate Subsidiary
and the proceeds thereof or on the Capital Stock of a Real Estate Subsidiary
pursuant to any financing permitted by clause (v) of the definition of
Permitted Indebtedness.”

 

2.8           Amendment
to Section 6.10 (Investments).  Section 6.10(f) of
the Credit Agreement is hereby amended to read in its entirety as follows:

 

“(f)          intercompany
Investments by (i) any Group Member in the Company or any Person that,
prior to such investment, is a Wholly Owned Subsidiary Guarantor, (ii) any
non-Loan Party Subsidiary in any other non-Loan Party Subsidiary, and (iii) any
Group Member in the MOPAR Subsidiary or a Real Estate Subsidiary in connection
with a financing permitted by clause (w) (in the case of the MOPAR
Subsidiary) or (v) (in the case of a Real Estate Subsidiary) of the
definition of Permitted Indebtedness; provided, however, that the
intercompany Investments permitted pursuant to this clause (iii) shall
consist solely of the assets which will serve as security for the financings
permitted under clauses (w) and (v) of the definition of “Permitted
Indebtedness”;”.

 

2.9           Amendment
to Section 6.14 (Clauses Restricting Subsidiary Distributions).  Section 6.14(c)(ix) of the Credit
Agreement is hereby amended to read in its entirety as follows:

 

“(ix) any encumbrance or restriction imposed by any terms of any
Indebtedness permitted by clause (g) of the definition of Permitted
Indebtedness or on the MOPAR Subsidiary or a Real Estate Subsidiary imposed by
any terms of Indebtedness permitted by clause (w) (in the case of the
MOPAR Subsidiary) or (v) (in the case of a Real Estate Subsidiary) of the
definition of Permitted Indebtedness or by any amendments, modifications,
restatements, increases, supplements, refundings, replacements, or refinancings
of the contracts, instruments or obligations referred to in clauses (i) through
(viii) above;”.

 

5

 

2.10         Amendment
to Section 6.16 (Asset Sale Collateral Account/Borrowing Base Collateral
Account).

 

(a)           The
heading of Section 6.16 is hereby amended to read in its entirety as
follows:

 

“Asset Sale Collateral Account”.

 

(b)           Section 6.16
is hereby amended to read in its entirety as follows:

 

“The Company may not withdraw amounts from the Asset Sale Collateral
Account unless (i) such amounts are used to prepay the Term Loans or (ii) such
amounts equal the amount that the Company has, substantially contemporaneously
with such withdrawal, reinvested into its business, whether such reinvestment
is from its working capital or from the proceeds in the Asset Sale Collateral
Account, provided that, no Default or Event of Default shall have occurred and
be continuing at the time of, or as a result of, such withdrawal.”

 

2.11         Amendment
to Section 9.14 (Releases of Guarantees and Liens).  Section 9.14 of the Credit Agreement is
hereby amended by adding a new clause (c) to read in its entirety as
follows:

 

“(c)         In connection with any financing
permitted by clauses (v) and (w) of the definition of Permitted
Indebtedness, the Administrative Agent may direct the Collateral Trustee to
enter into an intercreditor agreement or other arrangement with the secured
parties in respect of such financing if the Administrative Agent determines
that such intercreditor agreement or other arrangement is necessary or
advisable to establish the priority of any security interest, to allocate
proceeds of assets among the parties thereto and the Secured Parties in a
manner consistent with the rights of the parties as contemplated by this
Agreement and such financing or to protect the Liens in the Collateral granted
pursuant to the Security Documents.”

 

SECTION 3.           MISCELLANEOUS

 

3.1              Representations and Warranties.  Each Loan Party hereby represents and
warrants that, on the date hereof after giving effect to the provisions of this
Second Amendment, (a) each of the representations and warranties made by
any Loan Party in the Credit Agreement are true and correct in all material
respects on and as of the date hereof as if made on and as of such date, except
to the extent such representations and warranties expressly relate to a
particular date, in which case such representations and warranties were true
and correct in all material respects as of such date and (b) no Default or
Event of Default has occurred and is continuing.

 

3.2              Effectiveness.  This Second Amendment shall become effective
on the date on which the Administrative Agent shall have received (i) this
Second Amendment executed and delivered by the Administrative Agent, the Loan
Parties and each Lender and (ii) confirmation from the Administrative
Agent under the First Lien Credit Agreement that the amended and restated First
Lien Credit Agreement, dated as of the date hereof, shall have become
effective.

 

3.3           Continuing Effect of the Credit
Agreement.  This Second Amendment
shall not constitute an amendment of any other provisions of the Credit
Agreement not expressly referred to herein and shall not be construed as a
waiver or consent to any further or future action on the part of any Loan Party
that would require the consent of the Lenders or the Administrative Agent.  Except as expressly modified hereby, the
provisions of the Credit Agreements are and shall remain in full force and
effect.

 

6

 

3.4           Counterparts.  This Second Amendment may be executed by the
parties hereto in any number of separate counterparts (including facsimiled or
electronic PDF counterparts), each of which shall be deemed to be an original,
and all of which taken together shall be deemed to constitute one and the same
instrument.

 

3.5           Expenses.  Each of the Loan Parties agrees to pay or
reimburse the Administrative Agent for all of its reasonable out-of-pocket
costs and expenses incurred in connection with the preparation, negotiation and
execution of this Second Amendment, including, without limitation, the fees and
disbursements of counsel to the Administrative Agent.

 

3.6           Limited Effect.  Except as expressly modified by this Second
Amendment, the Credit Agreement and the other Loan Documents are ratified and
confirmed and are, and shall continue to be, in full force and effect in
accordance with their respective terms. 
Each Loan Party acknowledges and agrees that such Loan Party is truly
and justly indebted to the Lenders and the Administrative Agent for the
Obligations, without defense, counterclaim or offset of any kind, other than as
provided in the Loan Documents, and such Loan Party ratifies and reaffirms the
validity, enforceability and binding nature of such Obligations. The Company
acknowledges and agrees that nothing in this Second Amendment shall constitute
an indication of the Lenders’ willingness to consent to any other amendment or
waiver of any other provision of the Credit Agreement or a waiver of any
Default or Event of Default.

 

3.7           Loan Document.  This Second Amendment is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions of the Credit Agreement.

 

3.8           GOVERNING LAW.  THIS SECOND AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.

 

[Remainder
of the page intentionally left blank]

 

7

 

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

 

	
   

  	
  CARCO
  INTERMEDIATE HOLDCO II LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  CarCo Intermediate HoldCo I LLC, its managing

  member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  Chrysler Holding LLC, its managing member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Seth Plattus

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CHRYSLER,
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

[Second Amendment – OpCo Second Lien Credit Agreement]

 

 

	
   

  	
  CHRYSLER
  INTERNATIONAL LIMITED L.L.C.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  REALTY COMPANY LLC

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  DE VENEZUELA LLC

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  MOTORS LLC

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  VANS LLC

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  GLOBAL
  ELECTRIC MOTORCARS, LLC

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

[Second Amendment – OpCo Second Lien Credit Agreement]

 

 

	
   

  	
  CHRYSLER
  AVIATION INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  TRANSPORT INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  DCC
  929, INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  DEALER
  CAPITAL, INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  INTERNATIONAL SERVICES S.A.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  NEV
  MOBILE SERVICE, LLC

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

[Second Amendment – OpCo Second Lien Credit Agreement]

 

 

	
   

  	
  NEV
  SERVICE, LLC

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  TECHNOLOGIES MIDDLE EAST

  LTD.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  INTERNATIONAL CORPORATION

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  SERVICE CONTRACTS INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  
	
   

  
	
   

  	
  CHRYSLER
  SERVICE CONTRACTS FLORIDA,

  INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

[Second Amendment – OpCo Second Lien Credit Agreement]

 

 

	
   

  	
  TPF
  ASSETS, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TPF
  NOTE, LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  UTILITY
  ASSETS LLC

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  [illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

[Second Amendment – OpCo Second Lien Credit Agreement]

 

 

	
   

  	
  JPMORGAN
  CHASE BANK, N.A., as

  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Richard W. Duker

  
	
   

  	
  Name:
  

  
	
   

  	
  Title:  MANAGING
  DIRECTOR

  

 

[Second amendment – OpCo Second Lien Credit Agreement]

 

 

	
   

  	
  MADELEINE
  L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Seth Plattus

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

[Second Amendment – OpCo Second Lien Credit Agreement]

 

 

	
   

  	
  DAIMLERCHRYSLER
  NORTH AMERICA

  FINANCE CORPORATION, as Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Kurt Schaefer

  
	
   

  	
   

  	
  Name:
  K. Schaefer

  
	
   

  	
   

  	
  Title:
    Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Peter Zirwes

  
	
   

  	
   

  	
  Name:
  P. Zirwes

  
	
   

  	
   

  	
  Title:
    Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David A. Link

  
	
   

  	
   

  	
  Name:
  D.A. Link

  
	
   

  	
   

  	
  Title:
    President

  

 

[Signature page to the Second Amendment]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00137-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00137-of-00352.parquet"}]]