EXHIBIT 10.9
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NARCAT LLC,
CARCAT ULC, and
NARCAT MEXICO, S. DE X.X. DE C.V.
(the "Issuers")
and
XXXXX FARGO BANK, NATIONAL ASSOCIATION
(the "Indenture Trustee")
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INDENTURE
Dated as of February 12, 2004
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$29,000,000 2.79% CLASS A-1 RAILCAR NOTES DUE 2019
$21,000,000 4.57% CLASS A-2 RAILCAR NOTES DUE 2019
$31,400,000 5.13% CLASS A-3 RAILCAR NOTES DUE 2019
$ 5,000,000 14.00% CLASS B RAILCAR NOTES DUE 2019
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TABLE OF CONTENTS
SECTION HEADING PAGE
ARTICLE I DEFINITIONS; INTERPRETATION..................................... 3
Section 1.01. Definitions..................................................... 3
Section 1.02. Terms Defined in the Servicing Agreement, Sale Agreements
or Management Agreement...................................... 37
Section 1.03. Interpretation.................................................. 37
ARTICLE II NOTE FORM....................................................... 37
Section 2.01. General......................................................... 37
Section 2.02. Forms of Notes.................................................. 38
ARTICLE III TERMS OF NOTES; TRANSFERS....................................... 41
Section 3.01. Payment of Principal and Interest............................... 41
Section 3.02. Payments to Holders............................................. 41
Section 3.03. Execution, Authentication, Delivery and Dating.................. 42
Section 3.04. Temporary Notes................................................. 43
Section 3.05. Registration, Registration of Transfer and Exchange............. 43
Section 3.06. Transfer and Exchange........................................... 47
Section 3.07. Mutilated, Destroyed, Lost or Stolen Notes...................... 49
Section 3.08. Persons Deemed Holders.......................................... 49
Section 3.09. Cancellation of Notes........................................... 50
Section 3.10. Definitive Notes................................................ 50
Section 3.11. Tax Treatment................................................... 50
Section 3.12. Withholding Taxes............................................... 52
ARTICLE IV AUTHENTICATION AND DELIVERY OF NOTES; POST-CLOSING
FILINGS......................................................... 53
Section 4.01. General Provisions.............................................. 53
Section 4.02. Post-Closing Filings............................................ 57
ARTICLE V SATISFACTION AND DISCHARGE...................................... 58
Section 5.01. Satisfaction and Discharge of Indenture......................... 58
Section 5.02. Application of Trust Money...................................... 59
ARTICLE VI DEFAULTS AND REMEDIES........................................... 59
Section 6.01. Events of Default............................................... 59
Section 6.02. Acceleration of Maturity; Rescission and Annulment.............. 61
Section 6.03. Payment Obligations upon Acceleration........................... 62
Section 6.04. Remedies........................................................ 63
Section 6.05. Optional Preservation of Collateral............................. 64
Section 6.06. Indenture Trustee May File Proofs of Claim...................... 64
Section 6.07. Indenture Trustee May Enforce Claims Without Possession
of Notes..................................................... 65
Section 6.08. Application of Money Collected.................................. 65
Section 6.09. Limitation on Suits............................................. 67
Section 6.10. Unconditional Right of Holders to Receive Principal and
Interest..................................................... 68
Section 6.11. Restoration of Rights and Remedies.............................. 68
Section 6.12. Rights and Remedies Cumulative.................................. 68
Section 6.13. Delay or Omission Not Waiver.................................... 68
Section 6.14. Control by Controlling Party.................................... 69
Section 6.15. Waiver of Past Defaults......................................... 69
Section 6.16. Undertaking for Costs........................................... 70
Section 6.17. Waiver of Stay or Extension Laws................................ 70
Section 6.18. Sale of Collateral.............................................. 70
Section 6.19. Action on Notes................................................. 71
ARTICLE VII THE INDENTURE TRUSTEE........................................... 71
Section 7.01. Certain Duties and Responsibilities............................. 71
Section 7.02. Notice of Defaults, Events of Default, Servicer Termination
Events and Rapid Amortization Events......................... 72
Section 7.03. Certain Rights of Indenture Trustee............................. 73
Section 7.04. Not Responsible for Recitals or Issuance of Notes............... 74
Section 7.05. May Hold Notes.................................................. 75
Section 7.06. Money Held in Trust............................................. 75
Section 7.07. Compensation and Reimbursement.................................. 75
Section 7.08. Corporate Indenture Trustee Required; Eligibility............... 75
Section 7.09. Resignation and Removal; Appointment of Successor............... 76
Section 7.10. Acceptance of Appointment by Successor.......................... 76
Section 7.11. Merger, Conversion, Consolidation or Succession to
Business of Indenture Trustee................................ 77
Section 7.12. Co-trustees and Separate Trustees............................... 77
Section 7.13. Indenture Trustee to Hold Original Leases; Indenture Trustee
Check-In Procedures.......................................... 78
Section 7.14. Money for Note Payments to Be Held in Trust..................... 80
Section 7.15. Representations and Warranties of Indenture Trustee............. 80
Section 7.16. Reporting by Indenture Trustee.................................. 81
ARTICLE VIII PURCHASES AND RELEASES.......................................... 82
Section 8.01. Purchase of Railcars and Leases................................. 82
Section 8.02. Releases........................................................ 83
Section 8.03. Collateral...................................................... 83
ARTICLE IX SUPPLEMENTAL INDENTURES......................................... 84
Section 9.01. Supplemental Indentures without Consent of Holders.............. 84
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Section 9.02. Supplemental Indentures with Consent of Holders................. 85
Section 9.03. Prospective Amendment of Eligibility Criteria and
Concentration Limits......................................... 86
Section 9.04. Execution of Supplemental Indentures............................ 86
Section 9.05. Effect of Supplemental Indentures............................... 86
Section 9.06. Reference in Notes to Supplemental Indentures................... 86
Section 9.07. Amendments to Other Transaction Documents....................... 86
ARTICLE X REPRESENTATIONS AND WARRANTIES............................... 87
Section 10.01. Representations and Warranties.................................. 87
ARTICLE XI COVENANTS....................................................... 94
Section 11.01. Payment of Principal and Interest............................ 94
Section 11.02. Maintenance of Office or Agency.............................. 95
Section 11.03. Money for Note Payments to Be Held in Trust.................. 95
Section 11.04. Corporate Existence.......................................... 96
Section 11.05. Protection of Collateral..................................... 96
Section 11.06. Negative Covenants........................................... 98
Section 11.07. Statement as to Compliance................................... 98
Section 11.08. Investment Company Act....................................... 99
Section 11.09. Enforcement of Servicing Agreement, Management
Agreement, Sale Agreements and Funds
Transfer Agreement........................................... 99
Section 11.10. Issuers May Not Consolidate.................................. 99
Section 11.11. Opinions as to Collateral.................................... 99
Section 11.12. Performance of Obligations................................... 99
Section 11.13. Pro-Rata Purchases........................................... 99
Section 11.14. Insurance.................................................... 100
Section 11.15. Leasing of Railcars.......................................... 102
Section 11.16. Notice of Defaults, Events of Default, Servicer Events of
Termination, Manager Events of Termination and Rapid
Amortization Events.......................................... 104
Section 11.17. Limitation on Liability of Directors, Officers, or
Employees of the Issuers.................................. 104
Section 11.18. Obligations Under Leases..................................... 104
Section 11.19. Maintenance of Interests..................................... 105
Section 11.20. RESERVED..................................................... 105
Section 11.21. RESERVED..................................................... 105
Section 11.22. UMLER Designations........................................... 105
Section 11.23. Post-Closing Records......................................... 105
Section 11.24. RESERVED..................................................... 105
Section 11.25. Notification of Breaches..................................... 105
Section 11.26. Non-Consolidation............................................ 105
Section 11.27. Collections Received......................................... 105
Section 11.28. Sale Treatment............................................... 105
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Section 11.29. [RESERVED]................................................... 106
Section 11.30. Ownership Interest........................................... 106
Section 11.31. [RESERVED]................................................... 106
Section 11.32. No Change in Payment Instructions to Lessees................. 106
Section 11.33. No Deposits to Lockbox Accounts or Collection
Accounts..................................................... 106
Section 11.34. No Change in Name, Identity or Organizational
Documents.................................................... 107
Section 11.35. No Amendment to Transaction Documents........................ 107
Section 11.36. Compliance with Laws, etc.................................... 107
Section 11.37. Authorizations, Approvals and Recordations................... 107
Section 11.38. Reporting Requirements....................................... 107
Section 11.39. Audit and Inspection Rights.................................. 108
Section 11.40. Payment of Charges........................................... 109
Section 11.41. Maintenance of Records....................................... 109
Section 11.42. Post-Acquisition Matters..................................... 109
Section 11.43. Use and Maintenance of Railcar Assets........................ 109
Section 11.44. Tort Claims.................................................. 110
Section 11.45. Identification............................................... 110
Section 11.46. No Amendment to Any Lease.................................... 111
Section 11.47. Transfer of Railcars Among Issuers........................... 111
ARTICLE XII ACCOUNTS AND ACCOUNTINGS........................................ 111
Section 12.01. Collection of Money.......................................... 111
Section 12.02. Collection Accounts.......................................... 112
Section 12.03. Cash Collateral Accounts..................................... 120
Section 12.04. Operating Expense Reserve Account............................ 121
Section 12.05. Policy Payment Account....................................... 123
Section 12.06. Prefunding Account........................................... 123
Section 12.07. Redemption Account........................................... 124
Section 12.08. Optional Deposits by the Class A Note Insurer................ 125
Section 12.09. Securities Account........................................... 125
Section 12.10. Reports by Indenture Trustee to Holders...................... 125
ARTICLE XIII THE CLASS A NOTE POLICY......................................... 126
Section 13.01. Claims under the Class A Note Policy......................... 126
Section 13.02. Preference Claims............................................ 127
Section 13.03. Surrender of Class A Note Policy............................. 129
Section 13.04. Class A Note Insurer Deemed Holder for Certain
Purposes..................................................... 129
ARTICLE XIV REDEMPTION OF NOTES............................................. 129
Section 14.01. Redemption at the Option of the Issuers; Election to
Redeem....................................................... 129
Section 14.02. Notice to Indenture Trustee and Class A Note Insurer......... 130
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Section 14.03. Notice of Redemption by the Issuers.......................... 130
Section 14.04. Deposit of the Redemption Prices............................. 130
Section 14.05. Notes Payable on Redemption Date............................. 131
ARTICLE XV PROVISIONS OF GENERAL APPLICATION............................... 131
Section 15.01. General Provisions........................................... 131
Section 15.02. Acts of Holders.............................................. 131
Section 15.03. Notices, Etc, to Indenture Trustee, Issuers, the Class A
Note Insurer and Rating Agencies............................. 132
Section 15.04. Notices to Holders; Waiver................................... 133
Section 15.05. Successors and Assigns....................................... 134
Section 15.06. Separability................................................. 134
Section 15.07. Benefits of Indenture........................................ 134
Section 15.08. Legal Holidays............................................... 134
Section 15.09. Governing law................................................ 134
Section 15.10. Counterparts................................................. 134
Section 15.11. Corporate Obligation......................................... 135
Section 15.12. Compliance Certificates and Opinions......................... 135
Section 15.13. No Bankruptcy Petition Against any Issuer.................... 135
Section 15.14. Waiver of Jury Trial......................................... 136
Section 15.15. Consent to Jurisdiction...................................... 136
Section 15.16. Integration.................................................. 136
Section 15.17. Successors and Assigns; Binding Effect....................... 136
Section 15.18. Further Assurances........................................... 136
Section 15.19. Expenses..................................................... 136
Section 15.20. Survival of Representations and Warranties................... 137
Section 15.21. Interest Calculations........................................ 137
Schedule I Lease and Railcar Schedule............................................... I-1
Schedule II Additional Permitted Liens............................................... II-1
Schedule III Initial Appraised Values................................................. III-1
Schedule IV Lease Delivery Exceptions................................................ IV-1
Schedule V Delinquency Schedule..................................................... V-1
Schedule VI Prefunding Wiring Instructions........................................... VI-1
Exhibit A-1 Form of Class A-3 Investment Letter...................................... X-0-0
Xxxxxxx X-0 Form of Class B Investment Letter........................................ X-0-0
Xxxxxxx X-0 Form of Class A-1 Note................................................... X-0-0
Xxxxxxx X-0 Form of Class A-2 Note................................................... X-0-0
Xxxxxxx X-0 Form of Class A-3 Note................................................... X-0-0
Xxxxxxx X-0 Form of Class B Note..................................................... B-4-1
Exhibit C Form of Certificate of the Indenture Trustee............................. X-0
Xxxxxxx X-0 Form of Class A-1, Class A-2 and Class B Non-Bank Certificate............ D-1
Exhibit D-2 Form of Class A-3 Non-Bank Certificate................................... D-2
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This INDENTURE, dated as of February 12, 2004 (herein, as amended,
restated, and supplemented or otherwise modified from time to time as permitted
hereby, this "Indenture"), is among NARCAT LLC, a Delaware limited liability
company ("NARCAT"), CARCAT ULC, a Nova Scotia unlimited liability company
("CARCAT"), and NARCAT MEXICO, S. DE X.X. DE C.V., a Mexican limited liability
company with variable capital ("NARCAT Mexico") (each, an Issuer," and,
collectively, the "Issuers"), and XXXXX FARGO BANK, NATIONAL ASSOCIATION, a
national banking association (the "Indenture Trustee").
RECITALS
A The Issuers have duly authorized the execution and delivery of
this Indenture to provide for four classes of the Issuers' Railcar Notes,
designated as Class A-1 Notes (the "Class A-1 Notes"), Class A-2 Notes (the
"Class A-2 Notes"), Class A-3 Notes (the "Class A-3 Notes" and, together with
the Class A-1 Notes and the Class A-2 Notes, the "Class A Notes") and Class B
Notes (the "Class B Notes" and, together with the Class A Notes, the "Notes"),
issuable as provided in this Indenture.
B All obligations of the Issuers under this Indenture shall be
joint and several, except as may be expressly provided otherwise herein;
provided, however, that (a) all payments on the Class A-1 Notes, Class A-2 Notes
and Class B Notes shall be made solely from amounts held in the NARCAT
Collection Account (as defined herein) or, in the case of the Class A-1 Notes
and Class A-2 Notes, the Class A Note Policy (as defined below), and (b) all
payments on the Class A-3 Notes shall be made by or on behalf of CARCAT solely
from amounts held in the CARCAT Collection Account (as defined herein) or the
Class A Note Policy (as defined below) unless the Controlling Party (as defined
herein) otherwise directs after an acceleration of the Notes following the
occurrence of an Event of Default (as defined herein). All covenants and
agreements made by the Issuers herein are for the benefit and security of the
Holders of the Notes and the Class A Note Insurer (as defined below).
C MBIA Insurance Corporation, a New York domiciled stock
insurance corporation (the "Class A Note Insurer") has issued and delivered a
financial guaranty insurance policy, dated the date of initial issuance of the
Class A Notes (together with any endorsements, the "Class A Note Policy"),
pursuant to which the Class A Note Insurer agrees to make Insured Payments (as
defined in the Class A Note Policy) with respect to the Class A Notes.
D As an inducement to the Class A Note Insurer to issue and
deliver the Class A Note Policy, the Issuers and the Class A Note Insurer have
executed and delivered (i) the Insurance and Indemnification Agreement, dated as
of February 12, 2004 (as amended, restated, supplemented or otherwise modified,
the "Insurance Agreement"), among the Issuers, the Servicer (as defined herein),
the Manager (as defined herein), the Sellers (as defined herein), Holdco (as
defined herein), the Indenture Trustee and the Class A Note Insurer, and (ii)
the Premium Letter dated as of February 12, 2004 (as amended, restated,
supplemented or otherwise modified, the "Premium Letter") between the Issuers
and the Class A Note Insurer.
E The Issuers have agreed to pledge the Collateral (as defined
herein) to the Indenture Trustee for the benefit of the Holders of the Notes and
the Class A Note Insurer on the terms provided herein to secure the Issuers'
performance of the Secured Obligations (as defined herein).
F Subject to the relative rights and priorities of the various
Classes of Notes provided for herein, the covenants of each party are for the
benefit of the other parties and for the equal and ratable benefit of the
Holders of the Notes and the Class A Note Insurer.
G All things necessary to make the Notes, when executed by the
Issuers and authenticated and delivered hereunder, the valid joint and several
obligations of the Issuers, and to make this Indenture a valid agreement of the
parties hereto in accordance with its terms, have been done.
NOW, THEREFORE, in consideration of the premises, the mutual agreements
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
GRANTING CLAUSE
The Issuers hereby Grant to the Indenture Trustee, for the benefit of
the Holders of the Notes, as their interests may appear, and, subject to the
provisions hereof, for the benefit of the Class A Note Insurer, all property of
the Issuers, whether owned on the Closing Date or thereafter acquired,
including, without limitation, all of the rights, title, interest and benefits
of the Issuers in and to (a) the Existing Leases and all payments of Rent and
other amounts due under the Existing Leases on or after the Closing Date or the
Prefunded Railcar Acquisition Date, as applicable; (b) any Subsequent Leases and
all payments of Rent and other amounts due under such Subsequent Leases on or
after their dates of origination or, if later, the dates of transfer thereof to
an Issuer; (c) the Railcars, including all rights of the Issuers in any
associated registration numbers or marks; (d) the Cash Collateral Accounts, the
Operating Expense Reserve Account (including the NARCAT OER Subaccount and the
CARCAT OER Subaccount), the Prefunding Account, the Redemption Account
(including the NARCAT Redemption Subaccount and the CARCAT Redemption
Subaccount), the Policy Payment Account (including the NARCAT Policy Payment
Subaccount and the CARCAT Policy Payment Subaccount) and the Collection Accounts
and all Eligible Investments and any other funds or investments from time to
time on deposit therein; (e) the Asset Purchase Agreement, each Sale Agreement,
the Management Agreement, the Servicing Agreement, the Car Xxxx Agreement, the
GNRR Agreement, the Railcar Storage Agreement and the Funds Transfer Agreement,
including any remedies thereunder; (f) all warranties and maintenance
agreements, if any, with respect to the Railcars; (g) any Insurance Policies,
including rights to Insurance Proceeds, related to the Leases and the Railcars;
(h) the Lease Files; (i) all books, records and other documents relating to the
foregoing; and (j) all proceeds of the foregoing (including, but not by way of
limitation, all cash proceeds, accounts, accounts receivable, notes, drafts,
acceptances, chattel paper, checks, deposit accounts, insurance proceeds,
recoveries, condemnation awards, rights to payment of any and every kind, and
other forms of obligations and receivable which at any time constitute, all or
part or are included in the proceeds of any of the foregoing), in each case
whether now owned or
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hereafter acquired (all of the foregoing being hereinafter referred to,
collectively, as the "Collateral"). The Class A Notes, but not the Class B
Notes, will also have the benefit of any payments to be made pursuant to the
Class A Note Policy.
Such Grants are made in trust, to secure payments of amounts due with
respect to the Notes ratably and without prejudice, priority or distinction
between the Notes (subject to the payment priorities and other provisions of
this Indenture), and to secure (i) the payment of all amounts on the Notes as
such amounts become due in accordance with their terms, (ii) the payment of all
other sums payable in accordance with the provisions of this Indenture and the
other Transaction Documents, including, but not limited to, Reimbursement
Obligations, and (iii) compliance by the Issuers with the provisions of this
Indenture and the other Transaction Documents, all as provided in this
Indenture.
The Indenture Trustee acknowledges such Grants, accepts the trusts
hereunder in accordance with the provisions of this Indenture, and agrees to
perform the duties herein required pursuant to the terms and provisions of this
Indenture and subject to the conditions hereof.
PROVIDED, HOWEVER, that if there shall well and truly be paid the
principal of the Notes and the interest due or to become due on the Notes, at
the times and in the manner mentioned in the Notes, according to the true intent
and meaning thereof, and the Issuers shall cause all Reimbursement Obligations
to be paid to the Class A Note Insurer and payments shall be made into the
Collection Accounts as required under this Indenture and the payment of all
other sums and shall well and truly keep, perform and observe all the covenants
and conditions pursuant to the terms of this Indenture and the other Transaction
Documents to be kept, performed and observed by the Issuers, and the Issuers
shall pay or cause to be paid to the Indenture Trustee and all of its agents for
the registration, authentication, transfer or exchange of Notes all sums of
money due or to become due to it or them in accordance with the terms and
provisions hereof, then this Indenture and the rights hereby Granted shall
cease, terminate and be void; otherwise, this Indenture shall be and remain in
full force and effect.
ARTICLE I
DEFINITIONS; INTERPRETATION
Section 1.01. Definitions. Except as otherwise expressly provided or unless
the context otherwise requires, the following terms have the respective meanings
set forth below for all purposes of this Indenture.
"AAR" shall mean the Association of American Railroads.
"Accounting Date" shall mean the last day of each Collection Period.
"Act" shall have, with respect to any Holder, the meaning set forth in
Section 15.02.
"Affiliate" shall mean, with respect to any specified Person, any other
Person directly or indirectly controlling or controlled by or under common
control with such specified Person. For
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the purposes of this definition, "control" when used with respect to any
specified Person shall mean the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; the terms "controlling" and "controlled"
have meanings correlative to the foregoing; and a Person shall be deemed to have
control of another Person if the first such Person owns voting securities
constituting an aggregate amount of at least 5% of the second such Person.
"Agent Member" shall mean the members of, or participants in, the
Security Depository.
"Appraisal Date" shall mean January 30, 2004.
"Appraisals" shall mean the appraisals described in Section 4.01(q).
"Appraised Value Reduction Factor" shall mean, with respect to any
Accounting Date and with respect to any Railcar, an amount equal to the
following:
(a) if such Railcar was included in the Appraisals, the
Appraised Value Reduction Factor of such Railcar will be determined by
(i) subtracting from the Initial Appraised Value of such Railcar from
an amount equal to one half of the sum of the values projected by each
Appraiser to such Railcar as of the Projected Appraised Value Date,
(ii) dividing the result by 84, and (iii) multiplying the foregoing by
the number of months since the Accounting Date immediately preceding
the Closing Date; and
(b) if such Railcar was added to the pool after the
Appraisal Date, the Appraised Value Reduction Factor of such Railcar
will be determined by (i) subtracting from the Initial Appraised Value
of such Railcar an amount equal to the appraised value that would have
been determined as of the Projected Appraised Value Date under clause
(a) for railcars and locomotives having similar characteristics (such
as type of car, year built, refurbishment, possible uses of the car)
that were actually included in the Appraisals, (ii) dividing the result
by 84, and (iii) multiplying the foregoing by the number of months
since the Accounting Date immediately preceding the Closing Date.
"Article 9 Assets" shall mean the Collateral of a type in which an
interest may be perfected by the filing of a financing statement pursuant to
Article 9 of the Uniform Commercial Code in an applicable jurisdiction within
the United States.
"Asset Purchase Agreement" shall mean the Amended and Restated Asset
Purchase Agreement dated as of January 30, 2004, by and among Railcar Entities,
The Andersons and the Sellers, as the same may be amended, restated, modified or
supplemented from time to time in accordance with the terms thereof.
"Authorized Officer" shall mean, with respect to any entity, any
manager of such entity, or the President, any Vice President, any Assistant Vice
President, or any other officer or employee of, or authorized signatory or agent
for, such entity who has been duly authorized by the Board of Directors of such
entity, or any authorized officer of such entity, to perform the specific act or
duty or to sign the specific document in question.
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"Automatic Acceleration" shall have the meaning set forth in Section
6.02.
"Available Funds" shall mean, with respect to any Payment Date all cash
received during the related Collection Period from the following: (a)
Collections received by the Servicer or the Indenture Trustee, (b) net earnings
on the funds on deposit in the Collection Accounts, the Operating Expense
Reserve Account (including the NARCAT OER Subaccount and the CARCAT OER
Subaccount) and the Prefunding Account, (c) an amount equal to the lesser of (i)
the aggregate balances of the Cash Collateral Accounts as of the related
Accounting Date and (ii) the aggregate amount required to be withdrawn from the
Cash Collateral Accounts with respect to such Payment Date in accordance with
Section 12.03(a), (d) indemnification amounts paid pursuant to the Asset
Purchase Agreement and received by the Indenture Trustee, other than any such
indemnification amounts to which the Initial Manager shall be entitled pursuant
to Section 4.04(f) of the Management Agreement; and (e) any amounts on deposit
in the Collection Accounts as of the related Accounting Date (including any
Class A Note Insurer Optional Deposit), to the extent not duplicative of the
items described in clauses (a) through (d).
"Backup Manager" shall have the meaning set forth in the preamble of
the Management Agreement.
"Backup Manager Fee" shall have the meaning set forth in the Management
Agreement.
"Backup Servicer" shall have the meaning set forth in the preamble of
the Servicing Agreement.
"Backup Servicer Fee" shall have the meaning set forth in the Servicing
Agreement.
"Bailee Letter" shall mean that certain Bailee Letter, dated January
30, 2004, by and among the Railcar Entities and the Indenture Trustee, a form of
which is attached hereto as Exhibit E.
"Basic Principal Payment" shall mean, with respect to each Payment
Date, an amount equal to the sum of (a) the lesser of (i) the Note Principal
Balance of all Outstanding Notes and (ii) with respect to the Payment Dates in
March and April of 2004, zero, and with respect to each Payment Date thereafter,
$600,000, and (b) any Overdue Basic Principal Payments.
"Benefit Plan" shall have the meaning set forth in Section
3.05(c)(viii).
"Board of Directors" shall mean either the board of directors,
managers, or other applicable management individuals of any Person or any duly
authorized committee of such board or group.
"Board Resolution" shall mean a copy of a resolution certified by the
Secretary or an Assistant Secretary of a Person to have been duly adopted by its
Board of Directors and to be in full force and effect on the date of such
certification.
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"Book-Entry Notes" shall mean a beneficial interest in the Class A-1
Notes and Class A-2 Notes which are owned by QIBs, ownership and transfers of
which shall be made through book entries by a Security Depository as described
in Section 2.02.
"Business Day" shall mean any day other than a Saturday, Sunday or
other day on which commercial banking institutions in New York, New York,
Toledo, Ohio, Toronto, Ontario or the city and state in which the Indenture
Trustee maintains its Corporate Trust Office are authorized or obligated by law,
regulation or executive order to be closed.
"Canadian Article 9 Asset" shall mean all Article 9 Assets which the
Canadian Seller purports to transfer to CARCAT pursuant to the CARCAT Sale
Agreement.
"Canadian Filed Documents" shall mean those documents filed with the
Canadian Regulator within 10 days of the Closing Date pursuant to Section
2.03(h) of the Management Agreement.
"Canadian Insolvency Proceedings" shall mean proceedings commenced by
or against the Canadian Seller under the Bankruptcy and Insolvency Act (Canada),
the Winding-up and Restructuring Act (Canada), the Companies' Creditors
Arrangement Act (Canada), the oppression remedy provisions of the Nova Scotia
Companies Act, or the appointment of a receiver of the Canadian Seller under
Canadian or Nova Scotia law, as applicable.
"Canadian Lease" shall mean a Lease with a Lessee for which a Canadian
address is referenced on the Lease.
"Canadian Railcar" shall mean a Railcar which is the subject of a
Canadian Lease.
"Canadian Regulator" shall mean the Office of the Registrar General of
Canada, which maintains the database pursuant to Section 105 of the Canada
Transportation Act.
"Canadian Seller" shall mean Cap Acquire Canada ULC, a Nova Scotia
unlimited liability company, and its permitted successors and assigns.
"Canadian Tax Act" shall mean the Income Tax Act (Canada).
"Capped Manager Reimbursement" shall mean the aggregate amount payable
on any Payment Date pursuant to Section 12.02(d)(vi) and Section 6.08(a)(vi),
which aggregate amount shall not exceed $50,000.
"Car Hire Rules" shall mean the U.S. Code of Car Hire Rules, Circular
No. OT-10, and the related rules and regulations, promulgated by the AAR, as the
same may be amended, restated, modified or supplemented from time to time in
accordance with the terms thereof.
"Car Xxxx Agreement" shall mean that certain Car Xxxx Agreement, dated
as of the Closing Date, by and between Progress Rail Services Corporation and
the U.S. Seller.
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"Car Service Rules" shall mean the U.S. Code of Car Service Rules,
Circular No. OT-10, and the related rules and regulations, promulgated by the
AAR, as the same may be amended, restated, modified or supplemented from time to
time in accordance with the terms thereof.
"CARCAT" shall mean CARCAT ULC, a Nova Scotia unlimited liability
company, and its permitted successors and assigns.
"CARCAT Cash Collateral Account" shall mean the segregated trust
account established and maintained in the name of CARCAT, and pledged to the
Indenture Trustee for the benefit of the Holders and the Class A Note Insurer,
established in accordance with Section 12.03, which account shall constitute
part of the Collateral.
"CARCAT Collection Account" shall mean the segregated trust account
established and maintained in the name of CARCAT, for the benefit of the
Indenture Trustee on behalf of the Holders and the Class A Note Insurer,
established in accordance with Section 12.02, which account shall constitute
part of the Collateral.
"CARCAT OER Subaccount" shall have the meaning set forth in Section
12.04(a).
"CARCAT OER Subaccount Required Balance" shall have the meaning set
forth in Section 12.04(a).
"CARCAT Policy Payment Subaccount" shall have the meaning set forth in
Section 12.05(a).
"CARCAT Redemption Subaccount" shall have the meaning set forth in
Section 12.07(a).
"CARCAT Sale Agreement" shall mean the CARCAT Sale Agreement, dated as
of February 12, 2004, between the Canadian Seller and CARCAT, as the same may be
amended, restated, modified or supplemented from time to time in accordance with
the terms thereof.
"Cash Collateral Accounts" shall mean, individually or collectively, as
the context may require, the NARCAT Cash Collateral Account and the CARCAT Cash
Collateral Account.
"Class" shall mean all of the Notes of a series having the same
interest rate, priority of payments and designation.
"Class A Note Insurer" shall have the meaning set forth in the
Recitals.
"Class A Note Insurer Default" shall mean the existence and continuance
of any of the following:
(a) the Class A Note Insurer shall have failed to make a
payment required under the Class A Note Policy in accordance with its
terms;
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(b) the Class A Note Insurer shall have (i) filed a
petition or commenced any case or proceeding under any provision or
chapter of the United States Bankruptcy Code or any other similar
federal or state law relating to insolvency, bankruptcy,
rehabilitation, liquidation, or reorganization, (ii) made a general
assignment for the benefit of its creditors, or (iii) had an order for
relief entered against it under the United States Bankruptcy Code or
any other similar federal or state law relating to insolvency,
bankruptcy, rehabilitation, liquidation, or reorganization which is
final and nonappealable; or
(c) a court of competent jurisdiction or the New York
Department of Insurance or other competent regulatory authority shall
have entered a final and nonappealable order, judgment, or decree (i)
appointing a custodian, trustee, agent or receiver for the Class A Note
Insurer or for all or any material portion of its property or (ii)
authorizing the taking of possession by a custodian, trustee, agent, or
receiver of the Class A Note Insurer (or the taking of possession of
all or any material portion of the property of the Class A Note
Insurer).
"Class A Note Insurer Optional Deposit" shall have the meaning set
forth in Section 12.08.
"Class A Note Interest" shall mean, with respect to any Payment Date,
the sum of the Class A-1 Note Interest, the Class A-2 Note Interest and the
Class A-3 Note Interest.
"Class A Note Policy" shall have the meaning set forth in the Recitals.
"Class A Notes" shall have the meaning set forth in the Recitals.
"Class A Overdue Interest" shall mean, with respect to any Payment
Date, the sum of the Class A-1 Overdue Interest, the Class A-2 Overdue Interest
and the Class A-3 Overdue Interest.
"Class A-1 Holders" shall mean the holders of the Class A-1 Notes.
"Class A-1 Note Interest" shall mean (a) with respect to the initial
Payment Date, the product of (i) 1/360 of the Class A-1 Note Interest Rate times
(ii) the actual number of days from and including the Closing Date through the
day immediately preceding the initial Payment Date times (iii) the Note
Principal Balance of the Class A-1 Notes as of the Closing Date, and (b) with
respect to any subsequent Payment Date, the sum of (i) the product of (x) 1/12
of the Class A-1 Note Interest Rate times (y) the Note Principal Balance of the
Class A-1 Notes as of the immediately preceding Payment Date after giving effect
to all payments of principal of the Class A-1 Notes on such immediately
preceding Payment Date and (ii) the Class A-1 Overdue Interest, if any.
"Class A-1 Note Interest Rate" shall mean 2.79% per annum.
"Class A-1 Notes" shall mean the Railcar Notes, designated as Class A-1
Railcar Notes, issued in accordance with the provisions of this Indenture.
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"Class A-1 Overdue Interest" shall mean, with respect to any Payment
Date, the sum of (a) the positive difference, if any, between (i) the amount of
Class A-1 Note Interest due on the immediately preceding Payment Date and (ii)
the amount of Class A-1 Note Interest actually paid to Holders (from Available
Funds, without giving effect to any draws under the Class A Note Policy) on such
immediately preceding Payment Date, plus (b) (to the extent permitted by law)
interest on any such shortfall at the Overdue Rate from and including the
immediately preceding Payment Date through the day immediately preceding the
Payment Date of such calculation.
"Class A-1/A-2 Initial Purchaser" shall mean BB&T Capital Markets.
"Class X-0/X-0 Xxxxxxxx Xxxxxxxxx" shall mean that certain purchase
agreement, dated February 9, 2004, by and among the Issuers, The Andersons and
the Class A-1/A-2 Initial Purchaser, as the same may be amended, restated,
modified or supplemented from time to time in accordance with the terms thereof.
"Class A-2 Holders" shall mean the holders of the Class A-2 Notes.
"Class A-2 Note Interest" shall mean (a) with respect to the initial
Payment Date, the product of (i) 1/360 of the Class A-2 Note Interest Rate times
(ii) the actual number of days from and including the Closing Date through the
day immediately preceding the initial Payment Date times (iii) the Note
Principal Balance of the Class A-2 Notes as of the Closing Date, and (b) with
respect to any subsequent Payment Date, the sum of (i) the product of (x) 1/12
of the Class A-2 Note Interest Rate times (y) the Note Principal Balance of the
Class A-2 Notes as of the immediately preceding Payment Date after giving effect
to all payments of principal of the Class A-2 Notes on such immediately
preceding Payment Date and (ii) the Class A-2 Overdue Interest, if any.
"Class A-2 Note Interest Rate" shall mean 4.57% per annum.
"Class A-2 Notes" shall mean the Railcar Notes, designated as Class A-2
Railcar Notes, issued in accordance with the provisions of this Indenture.
"Class A-2 Overdue Interest" shall mean, with respect to any Payment
Date, the sum of (a) the positive difference, if any, between (i) the amount of
Class A-2 Note Interest due on the immediately preceding Payment Date and (ii)
the amount of Class A-2 Note Interest actually paid to Holders (from Available
Funds, without giving effect to any draws under the Class A Note Policy) on such
immediately preceding Payment Date, plus (b) (to the extent permitted by law)
interest on any such shortfall at the Overdue Rate from and including the
immediately preceding Payment Date through the day immediately preceding the
Payment Date of such calculation.
"Class A-3 Holders" shall mean the holders of the Class A-3 Notes.
"Class A-3 Initial Purchaser" shall mean BMO Xxxxxxx Xxxxx Inc.
-9-
"Class A-3 Note Interest" shall mean (a) with respect to the initial
Payment Date, the product of (i) 1/360 of the Class A-3 Note Interest Rate times
(ii) the actual number of days from and including the Closing Date through the
day immediately preceding the initial Payment Date times (iii) the Note
Principal Balance of the Class A-3 Notes as of the Closing Date, and (b) with
respect to any subsequent Payment Date, the sum of (i) the product of (x) 1/12
of the Class A-3 Note Interest Rate times (y) the Note Principal Balance of the
Class A-3 Notes as of the immediately preceding Payment Date after giving effect
to all payments of principal of the Class A-3 Notes on such immediately
preceding Payment Date and (ii) the Class A-3 Overdue Interest, if any.
"Class A-3 Note Interest Rate" shall mean 5.13% per annum.
"Class A-3 Notes" shall mean the Railcar Notes, designated as Class A-3
Railcar Notes, issued in accordance with the provisions of this Indenture.
"Class A-3 Overdue Interest" shall mean, with respect to any Payment
Date, the sum of (a) the positive difference, if any, between (i) the amount of
Class A-3 Note Interest due on the immediately preceding Payment Date and (ii)
the amount of Class A-3 Note Interest actually paid to Holders (from Available
Funds, without giving effect to any draws under the Class A Note Policy) on such
immediately preceding Payment Date, plus (b) (to the extent permitted by law)
interest on any such shortfall at the Overdue Rate from and including the
immediately preceding Payment Date through the day immediately preceding the
Payment Date of such calculation.
"Class A-3 Purchase Agreement" shall mean that certain purchase
agreement, dated February 9, 2004, by and among the Issuers, The Andersons and
the Class A-3 Initial Purchaser, as the same may be amended, restated, modified
or supplemented from time to time in accordance with the terms thereof.
"Class B Holders" shall mean the holders of the Class B Notes.
"Class B Initial Purchaser" shall mean CapStone Investments.
"Class B Note Interest" shall mean (a) with respect to the initial
Payment Date, the product of (i) 1/360 of the Class B Note Interest Rate times
(ii) the actual number of days from and including the Closing Date through the
day immediately preceding the initial Payment Date times (iii) the Note
Principal Balance of the Class B Notes as of the Closing Date, and (b) with
respect to any subsequent Payment Date, the sum of (i) the product of (x) 1/12
of the Class B Note Interest Rate times (y) the Note Principal Balance of the
Class B Notes as of the immediately preceding Payment Date after giving effect
to all payments of principal of the Class B Notes on such immediately preceding
Payment Date and (ii) the Class B Overdue Interest, if any.
"Class B Note Interest Rate" shall mean 14.00% per annum.
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"Class B Notes" shall mean the Railcar Notes, designated as Class B
Railcar Notes, issued in accordance with the provisions of this Indenture.
"Class B Overdue Interest" shall mean, with respect to any Payment
Date, the sum of (a) the positive difference, if any, between (i) the amount of
Class B Note Interest due on the immediately preceding Payment Date and (ii) the
amount of Class B Note Interest actually paid to Holders (from Available Funds)
on such immediately preceding Payment Date, plus (b) (to the extent permitted by
law) interest on any such shortfall at the Overdue Rate from and including the
immediately preceding Payment Date through the day immediately preceding the
Payment Date of such calculation.
"Class B Purchase Agreement" shall mean that certain purchase
agreement, dated February 9, 2004, by and among the Issuers, The Andersons and
the Class B Initial Purchaser, as the same may be amended, restated, modified or
supplemented from time to time in accordance with the terms thereof.
"Clean-up Call" shall mean a redemption of the Notes in accordance with
Section 14.01(b).
"Closing Date" shall mean February 12, 2004.
"Collateral" shall mean the property and rights Granted to the
Indenture Trustee pursuant to the Granting Clause of this Indenture for the
benefit of the Holders and the Class A Note Insurer.
"Collection Accounts" shall mean, individually or collectively, as the
context may require, the NARCAT Collection Account and the CARCAT Collection
Account.
"Collection Period" shall mean, with respect to any Payment Date, the
period beginning on the first day of the calendar month immediately preceding
such Payment Date and ending on the last day of such calendar month (each such
calendar month and portion thereof being referred to as the "related" Collection
Period with respect to a Payment Date); provided, that the initial Collection
Period shall begin on the Closing Date and shall end on February 29, 2004.
"Collections" shall mean, with respect to any Collection Period: (a)
payments received under the Leases (including without limitation, Rents) other
than (i) any prepayments with respect to future Collection Periods and (ii) in
the case of any Lease conveyed by the Manager to an Issuer pursuant to a
substitution of a Lease in accordance with Section 4.04 of the Management
Agreement, payments in respect of periods occurring prior to such conveyance;
(b) Insurance Proceeds, whether received under the Leases or otherwise (but
without duplication of amounts received in clause (a)), to the extent such
amounts are not used to repair or refurbish the related Railcar for the purpose
of making it available for sale or lease; (c) Railcar Release Proceeds; (d)
Purchase Proceeds; (e) Liquidation Proceeds; and (f) payments of Railroad
Mileage Credits attributable to the Railcars.
"Concentration Limits" shall have the meaning set forth in Section
11.15(c).
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"Controlling Party" shall mean (i) so long as any Class A Notes shall
be Outstanding and no Class A Note Insurer Default shall have occurred and be
continuing, the Class A Note Insurer, and (ii) if no Class A Notes shall be
Outstanding or a Class A Note Insurer Default shall have occurred and is
continuing, the Majority Holders.
"Corporate Trust Office" shall mean the principal corporate trust
office of the Indenture Trustee located at MAC X0000-000, Xxxxx Xxxxxx and
Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention: Corporate Trust
Services - Asset-Backed Administration, or at such other address as the
Indenture Trustee may designate from time to time by notice to the Holders, the
Class A Note Insurer, the Servicer, the Manager and the Issuers, or the
principal corporate trust office of any successor Indenture Trustee.
"Coverage Ratio" shall mean as of any Accounting Date, commencing with
the Accounting Date occurring on July 31, 2004, the ratio of:
(a) the sum of all Collections received during the
Collection Period ending on such Accounting Date and the immediately
preceding five Collection Periods minus the sum of (i) all payments to
be made on the Payment Date related to such Accounting Date and the
immediately preceding five Payment Dates pursuant to Section
12.02(d)(vi) and Section 6.08(a)(vi), (ii) all payments of Operating
Expense Deposit Amounts to be made on the Payment Date related to such
Accounting Date and the immediately preceding five Payment Dates and
(iii) the aggregate Manager Fee and Backup Manager Fee payable on the
Payment Date related to such Accounting Date and the immediately
preceding five Payment Dates; to
(b) the aggregate amount of the Trustee Fee, the Servicer
Fee, the Backup Servicer Fee, the Premium payable to the Class A Note
Insurer, the Class A Note Interest, the Class B Note Interest, the
Basic Principal Payments and that portion of the Supplemental Principal
Payment described in clauses (a)(i) and (ii) of the definition thereof,
in each case payable on the Payment Date related to such Accounting
Date and the immediately preceding five Payment Dates.
"Default" shall mean any occurrence or circumstance which with notice
or the lapse of time or both would become an Event of Default.
"Defaulted Lease" shall have the meaning set forth in the Servicing
Agreement.
"Deferred Supplemental Principal Payment" shall mean, with respect to
any Payment Date, the positive difference, if any, between (a) the Supplemental
Principal Payment payable on the prior Payment Date and (b) the aggregate amount
of the Supplemental Principal Payment actually paid from Available Funds
(without giving effect to any draws under the Class A Note Policy) to Holders on
the prior Payment Date.
"Definitive Notes" shall mean certificated definitive, fully registered
Notes.
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"Determination Date" shall mean the tenth day of each calendar month
(or if such day is not a Business Day, the next succeeding Business Day)
commencing March 10, 2004.
"Draw Date" means, with respect to any Payment Date, the third Business
Day (as defined in the Class A Note Policy) preceding such Payment Date.
"DTC" shall mean The Depository Trust Company, a New York corporation
and its successors and assigns.
"Eligible Investments" shall mean any and all of the following
instruments:
(a) direct obligations of, and obligations fully
guaranteed by, the United States of America or any agency or
instrumentality of the United States of America the obligations of
which are backed by the full faith and credit of the United States of
America;
(b) (i) demand and time deposits in, certificates of
deposit of, banker's acceptances issued by or federal funds sold by any
depository institution or trust company (including the Indenture
Trustee or its agent acting in their respective commercial capacities)
incorporated under the laws of the United States of America or any
State thereof, having capital and surplus (as shown by its latest
annual report of condition) aggregating at least $100,000,000, and
subject to supervision and examination by federal and/or state
authorities, so long as at the time of such investment or contractual
commitment providing for such investment, such depository institution
or trust company has a short term unsecured debt rating of at xxxxx
"X0" by S&P and at least "P1" by Xxxxx'x and provided that each such
investment has an original maturity of no more than 365 days, and (ii)
any other demand or time deposit or deposit which is fully insured by
the Federal Deposit Insurance Corporation;
(c) repurchase obligations with a term not to exceed 10
days with respect to any security described in clause (a) above and
entered into with a depository institution or trust company (acting as
a principal), having capital and surplus (as shown by its latest annual
report of condition) aggregating at least $100,000,000, and having a
short-term unsecured debt rating of "A1" or higher by S&P, and "P1" or
higher by Xxxxx'x; provided, however, that collateral transferred
pursuant to such repurchase obligation must be of the type described in
clause (a) above and must (i) be valued weekly at current market price
plus accrued interest, (ii) pursuant to such valuation, equal, at all
times, 105% of the cash transferred by the Indenture Trustee in
exchange for such collateral and (iii) be delivered to the Indenture
Trustee or, if the Indenture Trustee is supplying the collateral, an
agent for the Indenture Trustee, in such a manner as to accomplish
perfection of a security interest in the collateral by possession of
certificated securities;
(d) commercial paper having an original maturity of less
than 365 days and issued by an institution having a short term
unsecured debt rating in the highest available rating category of each
of the Rating Agencies at the time of such investment;
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(e) a guaranteed investment contract approved by each of
the Rating Agencies and the Controlling Party and issued by an
insurance company or other corporation having a long term unsecured
debt rating in the highest available rating category of each of the
Rating Agencies at the time of such investment;
(f) money market funds having ratings in one of the two
highest available rating categories of S&P and the highest available
rating category of Xxxxx'x at the time of such investment which invest
only in other Eligible Investments; any such money market funds which
provide for demand withdrawals being conclusively deemed to satisfy any
maturity requirement for Eligible Investments set forth in this
Indenture; and
(g) any other investment approved by the Controlling
Party and each Rating Agency.
Each of the Eligible Investments may be purchased by the Indenture Trustee or
through an Affiliate of the Indenture Trustee. All Eligible Investments shall be
made in the name of the Indenture Trustee for the benefit of the Holders and the
Class A Note Insurer.
"Eligible Lease" shall mean, as of any date of determination, a Lease
that satisfies each of the representations and warranties with respect to Leases
contained in Section 4.03 of the Management Agreement as of the immediately
preceding Accounting Date.
"Eligible Railcar" shall mean, as of any date of determination, a
Railcar that satisfies the representations and warranties with respect to
Railcars contained in Section 4.03 of the Management Agreement as of the
immediately preceding Accounting Date.
"Environmental Claim" shall mean any claim alleging any damage to the
environment or violation of any Environmental Law.
"Environmental Law" shall mean any federal, state, provincial, local,
or foreign statute, law, regulation, ordinance, rule, judgment, order, decree,
permit, concession, grant, franchise, license, agreement or governmental
restriction relating to pollution and the protection of the environment or the
release of any materials into the environment, including but not limited to any
of the foregoing related to Hazardous Commodities or wastes, air emissions and
discharges to waste or public systems.
"ERISA" shall mean The Employee Retirement Income Security Act of 1974,
as amended.
"Event of Default" shall have the meaning set forth in Section 6.01.
"Event of Loss" shall mean, with respect to any Railcar, the occurrence
of any of the following events with respect to such Railcar: (a) loss of such
Railcar or the loss of use of such Railcar due to destruction, damage beyond
repair, or rendition of such Railcar permanently unfit for normal use for any
reason whatsoever; (b) any damage to such Railcar which results in the receipt
of Insurance Proceeds with respect to such Railcar on the basis of an actual,
constructive
-14-
or compromised total loss; (c) the theft or disappearance of such Railcar which
results in the loss of possession of such Railcar for a period in excess of 60
days; (d) title to such Railcar shall be confiscated, requisitioned or otherwise
taken by a Governmental Authority, under the power of eminent domain or
otherwise; (e) the requisition of use by any Governmental Authority (other than
by a United States Governmental Authority, a Canadian Governmental Authority or
a Mexican Governmental Authority, in each case, whose long term unsecured
foreign currency debt obligations are rated AAA or above by S&P and Aaa by
Moody's) for a period of greater than 90 days, or by a United States
Governmental Authority, a Canadian Governmental Authority or a Mexican
Governmental Authority, in each case, whose long term foreign currency debt
obligations are rated AAA or above by S&P and Aaa by Moody's, for a period in
excess of 180 days or (f) during the term of any Lease, such other events with
respect to such Railcar that would give rise to the Lessee's obligation to make
a "loss value" payment (or equivalent payment) with respect to such Railcar.
"Excepted Leases" shall mean Leases which have terms of less than one
year, including, but not limited to, month-to-month Leases.
"Existing Leases" shall mean, collectively, the Initial Existing Leases
and the Prefunded Existing Leases.
"Final Payment Date" shall mean, with respect to any Note, the date on
which the final principal payment on such Note is to be made as herein provided,
whether on the Stated Legal Maturity Date, the Redemption Date or any other
date.
"Financial Statements" shall mean, with respect to any Person,
consolidated balance sheets, statements of income, retained earnings and cash
flows of such Person.
"Fitch" shall mean Fitch, Inc. (formerly known as Fitch Investors
Service, L.P.).
"FRA" shall have the meaning set forth in the Management Agreement.
"Full Service Lease" shall mean a Lease with respect to which the
lessor maintains and services the Railcars subject to such Lease, pays ad
valorem property taxes and provides several other ancillary services, including
auditing of Railroad Mileage Credits due from railroad companies.
"Funds Transfer Agreement" shall mean that certain Source of Funds
Direction Agreement, dated as of February 12, 2004, by and among NARCAT, CARCAT,
the U.S. Seller, the Canadian Seller and Holdco, as the same may be amended,
restated, modified or supplemented from time to time in accordance with the
terms thereof.
"GAAP" shall mean generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such accounting profession, in effect from time to time.
-15-
"Global Notes" shall mean the Rule 144A Global Notes, beneficial
ownership and transfers of which shall be made through book entries by the
Security Depository.
"GNRR Agreement" shall mean that certain Car Xxxx Agreement, dated June
21, 2001, by and between Railcar, Ltd., and Georgia Northeastern Railroad
Company, as the same may be amended, restated, modified or supplemented from
time to time in accordance with the terms thereof.
"Governmental Authority" shall mean any federal, state, provincial,
municipal or other governmental or quasi-governmental department, commission,
board, bureau, agency, authority or instrumentality, or any court or
administrative bureau, in each case whether of the United States, any of its
possessions or territories, or of any foreign nation or any jurisdiction
thereof, or, with respect to any Person, any arbitration, tribunal or
non-governmental authority to whose jurisdiction such Person has consented
(including, without limitation, the United States Department of Transportation,
the FRA and the STB).
"Grant" shall mean to grant, bargain, sell, warrant, alienate, remise,
release, convey, assign, transfer, mortgage, pledge, create and grant a security
interest in and right of set-off against, deposit, set over and confirm. A Grant
of the Collateral includes all rights, powers and options (but none of the
obligations) of the Granting party, including the immediate and continuing right
to claim, collect, receive and receipt for the Lease Receivables and other
payments with respect to the Leases, the Railcars and the other Railcar Assets,
and all other money or payments due with respect to the Collateral, to give and
receive notices and other communications, to make waivers or other agreements,
to exercise all rights and options, to bring Proceedings in the name of the
Granting party or otherwise, and generally to do and receive anything which the
Granting party is or may be entitled to do or receive thereunder or with respect
thereto.
"Gross Rent" shall mean, with respect to each Collection Period, the
Rents due during such Collection Period.
"Hazardous Commodities" shall mean the following commodities:
(a) any substance that is listed as a "hazardous waste"
pursuant to 42 U.S.C. Section 6901 et seq. or exhibits one or more of
the characteristics of "hazardous waste" described in regulations
promulgated pursuant to 42 U.S.C. Section 6901 et seq.;
(b) any substance that is a "hazardous substance" under
the definition set forth in 42 U.S.C. Section 9601(14);
(c) any substance contained on a list of "extremely
hazardous substances" pursuant to 42 U.S.C. Section 11002(a)(2);
(d) any petroleum product (other than solid plastic
products);
(e) any radioactive material;
-16-
(f) asbestos;
(g) polychlorinated biphenyls;
(h) any substance that is a "pesticide" under the
definition set forth in 7 U.S.C. Section 136(u);
(i) any chemical substance or living organism regulated
under 21 U.S.C. Chapter 9 (the Federal Food, Drug and Cosmetic Act)
which is capable of having an acute or chronic toxic effect upon any
species of living organism;
(j) any Municipal Waste referred to in, or any K grade or
W grade commodities listed in Appendix A to, Car Service Rule 14;
(k) any other substance, product, liquid, waste,
pollutant, chemical, contaminant, insecticide, pesticide, gaseous or
solid matter, organic or inorganic matter, fuel, micro-organism, ray,
odor, radiation, energy, vector, plasma, constituent or material which
(a) is or becomes listed, regulated or addressed under any
Environmental Law, or (b) is, or is deemed to be, alone or in any
combination, hazardous, hazardous waste, toxic, a pollutant, a
deleterious substance, a contaminant or a source of pollution or
contamination under any Environmental Law applicable to Railcars
operating in Canada; and
(l) any other commodity designated by the Indenture
Trustee or the Class A Note Insurer as a Hazardous Commodity based upon
the Indenture Trustee's or the Class A Note Insurer's, as applicable,
reasonable judgment and belief, consistent with standard or prudent
railroad rolling stock industry practice, that such commodity is a
contaminating or hazardous commodity.
For the avoidance of doubt, it is understood and agreed that the designation of
(or the failure to designate) any commodity as a Hazardous Commodity shall in no
event be deemed a representation, warranty or advice by the Indenture Trustee or
the Class A Note Insurer as to the danger (or safety) of such commodity.
"Holdco" shall mean TOP CAT Holding Co., a Delaware corporation, and
its permitted successors and assigns.
"Holder" shall mean the Person in whose name a Note is registered in
the Note Register.
"Incremental Class A Interest" shall mean, if and to the extent that
interest accrues on the Note Principal Balance of any Class A Note at the
Overdue Rate, the excess of such interest over the amount of interest accruing
at the Class A-1 Note Interest Rate, the Class A-2 Note Interest Rate or the
Class A-3 Note Interest Rate, as applicable.
-17-
"Indenture" or "this Indenture" shall mean this instrument as
originally executed and, if from time to time supplemented or amended by one or
more indentures supplemental hereto entered into pursuant to the applicable
provisions hereof, as so supplemented or amended.
"Indenture Trustee" shall mean Xxxxx Fargo Bank, National Association,
a national banking association, until a successor Person shall have become the
Indenture Trustee pursuant to the applicable provisions of this Indenture, and
thereafter "Indenture Trustee" shall mean such successor Person.
"Independent Appraiser" shall mean any independent railroad rolling
stock appraisal expert of recognized standing selected by the Manager and
approved by the Controlling Party; provided that the Controlling Party may
select any railroad rolling stock appraisal expert (acceptable to the Class A
Note Insurer so long as no Class A Note Insurer Default has occurred and is
continuing and the Class A Notes are still Outstanding) without the approval of
the Manager or any Issuer during the continuation of an Event of Default.
"Initial Appraised Value" shall mean, (a) in respect of any Initial
Railcar, an amount determined by reference to the schedule attached hereto as
Schedule III or (b) in respect of any Substitute Railcar, an amount determined
by the Manager, in its reasonable judgment, which is equal to one half of the
sum of the values which, had such Substitute Railcar been covered by the
Appraisals, would have been assigned by each Appraiser to such Substitute
Railcar as of the Appraisal Date (based upon the values of railcars and
locomotives having similar characteristics (such as type of car, year built,
refurbishment, possible uses of the car) that were actually included in the
Appraisals) using a "comparable sales approach" to determining the fair market
value of such Substitute Railcar if such Substitute Railcar were sold in
arms-length open market transactions without taking into consideration any value
derived from the Existing Leases (corresponding to the "Traditional Collateral
Valuation" in the Appraisal issued by RailSolutions, Inc., and the "Market
Approach/Current Fair Market Value" in the Appraisal issued by X. X. Xxxxx &
Associates, Inc.); provided, however, that in the event that, at any one time,
ten or more Substitute Railcars shall be required to be substituted as provided
in Section 8.01(b), then the determination of the Manager referenced above
shall, unless otherwise agreed by the Controlling Party, be supported by new
appraisals prepared by no fewer than two Independent Appraisers.
"Initial CARCAT Cash Collateral Deposit" shall mean $1,150,000.
"Initial Existing Leases" shall mean, any contract, agreement or other
arrangement between the owner of an Initial Railcar and any third party
providing for the lease, hire, operation or other use of such Initial Railcar by
or through such third party, including a Master Lease Agreement (each schedule
to a Master Lease Agreement, together with the terms of such Master Lease
Agreement, constituting a separate and independent lease), lease, operating
agreement, use agreement, a car hire contract or Per Diem Lease sold to an
Issuer on the Closing Date, including any riders, supplements and annexes
thereto, as the same may be amended, restated, supplemented or otherwise
modified in accordance with the terms hereof.
"Initial Manager" shall have the meaning set forth in the Management
Agreement.
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"Initial NARCAT Cash Collateral Deposit" shall mean $1,050,000.
"Initial Purchaser" or "Initial Purchasers" shall mean, individually or
collectively, as the context may require, the Class A-1/A-2 Initial Purchaser,
the Class A-3 Initial Purchaser and the Class B Initial Purchaser.
"Initial Railcar Assets" shall mean any Railcar Assets as they apply to
any Initial Railcar or Initial Existing Lease.
"Initial Railcars" shall mean those Railcars transferred by a Seller to
an Issuer pursuant to the applicable Sale Agreement on the Closing Date and
identified on the Lease and Railcar Schedule as of the Closing Date.
"Insurance Agreement" shall have the meaning set forth in the Recitals.
"Insurance Policy" shall mean liability, property, or casualty
insurance policy or any other type of insurance policy as the context may
require.
"Insurance Proceeds" shall mean any and all amounts related to the
Railcars, the Railcar Assets, the Leases or other Collateral, to the extent
received by the Servicer or the Indenture Trustee, paid (a) under an Insurance
Policy, (b) by or on behalf of a Lessee or railroad, (c) by the Manager pursuant
to its obligations with respect to insurance under the Management Agreement, or
(d) from any other source with respect to casualty or other losses with respect
to the Railcars (whether or not constituting an Event of Loss), in each case
with respect to any casualty or other destruction resulting in economic loss to
a Railcar.
"Insured Payment" shall have the meaning set forth in the Class A Note
Policy.
"Insurers" shall have the meaning set forth in Section 11.14(a).
"Interchange Rules" shall have the meaning set forth in the Sale
Agreements.
"Intercompany Advance Agreement" shall mean the Intercompany Advance
Agreement, dated as of February 12, 2004, by and among The Andersons, the
Canadian Seller, the Mexican Seller, CARCAT and NARCAT Mexico, as the same may
be amended, restated, modified or supplemented from time to time in accordance
with the terms thereof.
"Investment Letter" shall mean, with respect to the Class A-3 Notes, a
letter substantially in the form attached hereto as Exhibit A-1 and, with
respect to the Class B Notes, a letter substantially in the form attached hereto
as Exhibit A-2.
"Issuer Order" or "Issuer Request" shall mean a written order or
request signed by one of the managers or by the Chairman of the Board, the
President, a Vice President, the Treasurer, an Assistant Treasurer, the
Controller, an Assistant Controller, the Secretary or an Assistant Secretary of
each Issuer and delivered to the Indenture Trustee.
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"Issuer Retained Interest" shall mean any payment to the Issuers in
accordance with Section 12.02(d)(xxiii).
"Issuers" shall mean NARCAT, CARCAT and NARCAT Mexico, until one or
more successor Persons shall have become an Issuer pursuant to the applicable
provisions of this Indenture, and thereafter the Issuers shall include such
successor Person.
"Law" shall mean any law, statute, ordinance, rule, regulation,
judgment, injunction, order, decree or code adopted, enacted or promulgated by
any Governmental Authority or the requirements of the AAR, any self-regulatory
agency or any entity of a nature similar to that of any of the foregoing.
"Lease" shall mean any Existing Lease or Subsequent Lease and "Leases"
shall mean, collectively, all Existing Leases and Subsequent Leases.
"Lease Exception Report" shall have the meaning set forth in Section
7.13(b).
"Lease File" shall have the meaning set forth in the Servicing
Agreement.
"Lease and Railcar Schedule" shall mean the listing of Leases and
Railcars being pledged to the Indenture Trustee on the Closing Date attached
hereto as Schedule I, as the same may be adjusted to reflect (a) the acquisition
by NARCAT of the Prefunded Railcars on the Prefunded Railcar Acquisition Date,
(b) any Subsequent Lease added pursuant to Section 11.15 and Section 2.03(c) of
the Management Agreement or (c) the release of any Railcar from the Lien of this
Indenture pursuant to Section 8.02. The Lease and Railcar Schedule as of the
Closing Date shall be a comprehensive list consisting of all Leases and Railcars
listed on the "Lease and Railcar Schedules" identified in the Sale Agreements.
"Lease Receivables" shall mean, with respect to any Lease, the right to
receive (a) the Rents and other amounts payable to the lessor under such Lease
and (b) any Railroad Mileage Credits relating to such Lease including, with
respect to (a) and (b) above, the right to enforce, to declare a default under,
or to terminate the Lease insofar as it gives rise to such Lease Receivable, and
to repossess the related Railcar, in the event such Lease becomes a Defaulted
Lease.
"Leased Railcars" shall mean, with respect to any Accounting Date,
Railcars that are subject to a Lease.
"Lessee" shall mean the lessee under each related Lease, or a successor
or assignee of such lessee, but not including a sublessee.
"Liability Insurance" shall have the meaning set forth in Section
11.14(a)(ii).
"Liens" shall mean any and all liens, encumbrances, mortgages,
hypothecs, charges, claims, restrictions, pledges, security interests and
impositions of any nature or kind (including
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any conditional sale or other title retention agreement, any lease in the nature
thereof, and any agreement to give any security interest).
"Liquidation Proceeds" shall mean (a) any and all amounts (other than
Insurance Proceeds) received by the Servicer or any Issuer in connection with
the complete or partial liquidation of a Defaulted Lease, whether through sale
of such Lease and/or re-leasing or sale of the related Railcar or otherwise, and
(b) any proceeds of any Railcar which has not been released from the Lien of
this Indenture pursuant to Section 8.02 (whether such proceeds arise from the
re-lease or sale of such Railcar).
"Lockbox Account" shall have the meaning set forth in the Servicing
Agreement.
"Lockbox Agreements" shall have the meaning set forth in the Servicing
Agreement.
"Lockbox Bank" shall have the meaning set forth in the Servicing
Agreement.
"Maintenance Expense Reimbursement Request" shall have the meaning set
forth in Section 2.06(b) of the Management Agreement.
"Majority Holders" shall mean, at any time, (a) if any Class A Notes
remain Outstanding, the Holders of Class A Notes representing a majority in
aggregate unpaid principal amount of all Class A Notes then Outstanding and (b)
if no Class A Notes remain Outstanding, the Holders of Class B Notes
representing a majority in aggregate unpaid principal amount of all Class B
Notes then Outstanding.
"Management Agreement" shall mean the Management Agreement, dated as of
February 12, 2004, by and among the Manager, the Indenture Trustee, the Backup
Manager, NARCAT, CARCAT and NARCAT MEXICO, as the same may be amended, restated,
modified or supplemented from time to time in accordance with the terms thereof.
"Manager" shall mean The Andersons, and its permitted successors and
assigns.
"Manager Event of Termination" shall have the meaning set forth in the
Management Agreement.
"Manager Fee" shall have the meaning set forth in the Management
Agreement.
"Master Lease Agreement" shall mean an agreement between a proposed
lessor of a Railcar and a proposed lessee of a Railcar setting forth the general
terms and provisions governing any such lease, but which agreement does not
itself constitute a lease of specific Railcars.
"Material Adverse Effect" means, with respect to any entity or group of
entities or assets or liabilities (a) a material adverse effect on or change in,
or any development that, insofar as reasonably can be foreseen, is reasonably
likely to have a material adverse effect on or change in the business,
operations, assets, liabilities, prospects, financial condition or results of
operations
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of the applicable matter taken as a whole, other than any change, circumstance
or effect (i) relating to the economy or securities markets in general, (ii)
relating generally to the industries in which such entity or group of entities
or assets or liabilities operates and not specifically relating to it, or (iii)
resulting from the execution or performance of this Indenture or the
announcement thereof, (b) a material adverse effect on the ability of such
entity or group of entities to perform any of their respective obligations under
this Indenture or any other Transaction Document, (c) a material adverse effect
on the interests or rights of or benefits or remedies available to the Indenture
Trustee or any other Secured Party (and their respective successors and assigns)
under this Indenture or any other Transaction Document, (d) an adverse effect on
the validity or enforceability of this Indenture or any other Transaction
Document or (e) an adverse effect on the value, utility or useful life of any
Railcar or other Collateral which exceeds, individually or in the aggregate, 10%
of the aggregate Stated Value of all of the Railcars.
"Maximum Class A Note Amount" shall mean, as of any Payment Date, the
original Note Principal Balance of the Class A Notes, less the sum of (a) all
scheduled Basic Principal Payments in respect of the Class A Notes (including
the Basic Principal Payment for such Payment Date), and (b) any Supplemental
Principal Payments actually made in respect of the Class A Notes prior to such
Payment Date to the extent such Supplemental Principal Payments related to the
sale of, or the occurrence of any Event of Loss with respect to any Railcar.
"Mexican Article 9 Assets" shall mean all Article 9 Assets which the
Mexican Seller purports to transfer to NARCAT MEXICO pursuant to the NARCAT
MEXICO Sale Agreement.
"Mexican Railcars" shall mean Railcars which have been permanently
imported into Mexico.
"Mexican Seller" shall mean Cap Acquire Mexico, S. de X.X. de C.V., a
Mexican limited liability company with variable capital, and its permitted
successors and assigns.
"Mexican Withholding Taxes" shall have the meaning set forth in Section
3.12(a).
"Minimum Long-Term Rating" shall have the meaning set forth in Section
11.15(c).
"Modified Lease" shall have the meaning set forth in the Management
Agreement.
"Monthly Average Lease Rate" shall mean, for any Accounting Date, (a)
the Gross Rent for the related Collection Period, minus (b) the sum of (i) the
Operating Expense Deposit Amount related to Leased Railcars, plus (ii) the
Manager Fee accrued for the related Collection Period with respect to Leased
Railcars, plus (iii) the amount of Capped Manager Reimbursement, if any, to be
paid on the related Payment Date, divided by (c) the number of Leased Railcars.
"Monthly Manager Report" shall have the meaning set forth in the
Management Agreement.
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"Monthly Servicer Report" shall have the meaning set forth in the
Servicing Agreement.
"Monthly Utilization Rate" shall mean, for any Accounting Date, the
percentage determined by dividing:
(a) the total number of Eligible Railcars subject to a
Lease as of such Accounting Date, other than any such Eligible Railcars
which are subject to a Lease as to which Rent shall be overdue by more
than 90 days, by
(b) the total number of Eligible Railcars as of such
Accounting Date.
"Moody's" shall mean Xxxxx'x Investors Service, Inc., and its
successors and assigns.
"NARCAT" shall mean NARCAT LLC, a Delaware limited liability company,
and its permitted successors and assigns.
"NARCAT Cash Collateral Account" shall mean the segregated trust
account established and maintained in the name of NARCAT and NARCAT Mexico, and
pledged to the Indenture Trustee for the benefit of the Holders and the Class A
Note Insurer, established in accordance with Section 12.03, which account shall
constitute part of the Collateral.
"NARCAT Collection Account" shall mean the segregated trust account
established and maintained in the name of NARCAT and NARCAT Mexico, for the
benefit of the Indenture Trustee on behalf of the Holders and the Class A Note
Insurer, established in accordance with Section 12.02, which account shall
constitute part of the Collateral.
"NARCAT Entities" shall mean NARCAT and NARCAT Mexico, collectively.
"NARCAT Mexico" shall mean NARCAT Mexico, S. de X.X. de C.V., a Mexican
limited liability company with variable capital, and its permitted successors
and assigns.
"NARCAT Mexico Sale Agreement" shall mean the NARCAT Mexico Sale
Agreement, dated as of February 12, 2004, between the Mexican Seller and NARCAT
Mexico, as the same may be amended, restated, modified or supplemented from time
to time in accordance with the terms thereof.
"NARCAT OER Subaccount" shall have the meaning set forth in Section
12.04(a).
"NARCAT OER Subaccount Required Balance" shall have the meaning set
forth in Section 12.04(a).
"NARCAT Redemption Subaccount" shall have the meaning set forth in
Section 12.07(a).
"NARCAT Policy Payment Subaccount" shall have the meaning set forth in
Section 12.05(a).
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"NARCAT Sale Agreement" shall mean the NARCAT Sale Agreement, dated as
of February 12, 2004, between the U.S. Seller and NARCAT, as the same may be
amended, restated, modified or supplemented from time to time in accordance with
the terms thereof.
"Non-Mexican Collateral" shall mean all Collateral with respect to
which first priority security interests may be created under the laws of the
United States or any state thereof, or Canada or any province thereof.
"Note" or "Notes" shall mean, individually or collectively, the Class A
Notes and the Class B Notes.
"Note Depository Agreement" shall mean the agreement dated February 12,
2004, among the Issuers, the Indenture Trustee and DTC, as the initial Security
Depository, relating to the Book-Entry Notes.
"Note Owner" shall mean, with respect to a Book-Entry Note, the Person
who is the beneficial owner of such Book-Entry Note, as reflected on the books
of the Security Depository or on the books of a Person maintaining an account
with such Security Depository (directly as a Security Depository Participant or
as an indirect participant, in each case in accordance with the rules of such
Security Depository) or the Person who is the beneficial owner of such
Book-Entry Note, as reflected in the Note Register in accordance with Section
3.05.
"Note Principal Balance" shall mean, with respect to a Note (or, if the
context so requires, with respect to all Notes Outstanding or all Notes of any
Class Outstanding), as of any date of determination, the original principal
balance of such Note (or Notes or Class of Notes, as applicable), as reduced by
all amounts previously paid on such Note (or Notes or Class of Notes, as
applicable) in reduction of the principal balance of such Note (or Notes or
Class of Notes, as applicable) which have not been returned to any Issuer or to
any other Person for any reason.
"Note Register" and "Note Registrar" shall have the respective meanings
specified in Section 3.05.
"Offering Memorandum" shall mean (i) with respect to the Class A-1
Notes, the Class A-2 Notes and the Class B Notes, the offering memorandum, dated
February 9, 2004, pursuant to which the Class A-1 Notes, the Class A-2 Notes and
the Class B Notes are offered and (ii) with respect to the Class A-3 Notes, the
Canadian offering memorandum, dated February 9, 2004, pursuant to which the
Class A-3 Notes are offered.
"Officer's Certificate" shall mean, with respect to any company, a
certificate signed by a manager of such company or by the Chairman of the Board,
the President, a Vice President, the Treasurer, the Controller, an Assistant
Controller, the Secretary or an Assistant Secretary of such company, and
delivered to the Indenture Trustee and which certificate shall comply with the
applicable requirements of Section 15.12. Unless otherwise specified, any
reference in this Indenture to an Officer's Certificate shall be to an Officer's
Certificate executed by all Issuers.
"Operating Agreement" shall have the meaning set forth in the Sale
Agreements.
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"Operating Expense" means any actual out-of-pocket expense paid to a
third party to maintain the Railcars, to pay taxes and insurance with respect to
the Railcars (excluding, in the case of CARCAT, reimbursement to NARCAT for
payments made in respect of the Class A Note Policy), and other amounts
specified in the Management Agreement.
"Operating Expense Deposit Amount" shall mean, with respect to each
Payment Date, the sum of (a) $75 multiplied by the number of Railcars subject to
a Full Service Lease or Modified Lease and operating primarily in the United
States as of the related Accounting Date, (b) $90 multiplied by the number of
Railcars subject to a Full Service Lease or Modified Lease and operating
primarily in Canada as of the related Accounting Date, (c) $90 multiplied by the
number of Railcars subject to a Full Service Lease or Modified Lease and
operating primarily in Mexico as of the related Accounting Date, (d) $0
multiplied by the number of Railcars subject to a Lease which is a Triple Net
Lease as of the related Accounting Date and (e) $30 multiplied by the number of
Railcars not subject to a Lease as of the related Accounting Date, regardless of
where such Railcar is primarily operated.
"Operating Expense Reserve Account" shall mean the segregated trust
account established for the benefit of the Holders and the Class A Note Insurer
and established in accordance with Section 12.04, which account shall constitute
part of the Collateral.
"Opinion of Counsel" shall mean a written opinion of counsel who may,
except as otherwise expressly provided in this Indenture, be counsel (which may
be internal counsel) for one or more of the Issuers and who shall be reasonably
satisfactory to the Indenture Trustee and the Class A Note Insurer and which
opinion shall comply with the applicable requirements of Section 15.12.
"Optional Redemption" shall mean a redemption of the Notes in
accordance with Section 14.01(a).
"Outstanding" shall mean, with respect to Notes, as of any date of
determination, all Notes theretofore authenticated and delivered under this
Indenture except:
(a) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(b) Notes for whose payment money in the necessary amount
has been theretofore irrevocably deposited with the Indenture Trustee
or any Paying Agent (other than any Issuer) in trust for the Holders of
such Notes pursuant to Article V (provided, however, that if such Notes
are to be redeemed, notice of such redemption has been duly given
pursuant to this Indenture or provision therefor, satisfactory to the
Indenture Trustee, has been made);
(c) Notes in exchange for or in lieu of which other Notes
have been authenticated and delivered pursuant to this Indenture unless
proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a bona fide purchaser; and
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(d) Notes alleged to have been destroyed, lost or stolen
for which replacement Notes have been issued as provided for in Section
3.07;
provided, however, that for purposes of determining whether the Holders of the
requisite principal amount of the Outstanding Notes have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Notes
owned by any Issuer or any other obligor upon the Notes or any Affiliate of any
Issuer or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Indenture Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent, or waiver, only Notes which the Indenture Trustee knows to be
so owned shall be so disregarded. Notes so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Indenture Trustee the pledgee's right to exercise the
Holders' rights to act with respect to such Notes and that the pledgee is not an
Issuer or any other obligor upon the Notes or any Affiliate of any Issuer or
such other obligor.
"Overdue Basic Principal Payments" shall mean, with respect to any
Payment Date, the positive difference, if any, between (a) the Basic Principal
Payment due on the immediately preceding Payment Date and (b) the aggregate
amount of the Basic Principal Payment actually paid from Available Funds
(without giving effect to any draws under the Class A Note Policy) to Holders on
such immediately preceding Payment Date.
"Overdue Rate" shall mean, with respect to the Class A Notes, the Prime
Rate, plus 2% per annum, and, with respect to the Class B Notes, the Class B
Note Interest Rate.
"Overdue Scheduled Class B Payments" shall mean, with respect to any
Payment Date, the positive difference, if any, between (a) the Scheduled Class B
Payment due on the immediately preceding Payment Date and (b) the aggregate of
Scheduled Class B Payment actually paid from Available Funds to Holders on such
immediately preceding Payment Date.
"Ownership Interest" shall mean, with respect to any Note, any
ownership interest in such Note, including any interest in such Note as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial.
"Paying Agent" shall mean the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
Section 7.08 and is authorized by the Issuers to pay the principal of, or
interest on, any Notes on behalf of the Issuers.
"Payment Date" shall mean the 15th day of each calendar month (or if
such day is not a Business Day, the next succeeding Business Day), commencing
March 15, 2004.
"Per Diem Lease" shall mean a Lease in which the Lessee pays an amount
based on the miles traveled and the use of the Railcar, although the Lessee may
have free use of the Railcar while the Railcar is on a Lessee's railroad.
"Permitted Liens" shall mean (a) materialmens', mechanics', carriers',
repairmens', employees' or other similar Liens arising in the ordinary course of
business, other than Liens for
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amounts due and owing, that individually or in the aggregate do not detract from
the value of the property subject thereto or affected thereby, (b) Liens for
current Taxes, of any kind, not yet due and payable or that are being contested
in good faith by appropriate proceeding for which adequate reserves have been
established in accordance with GAAP, so long as enforcement thereof has been
stayed and such proceedings do not involve any material risk of forfeiture, loss
or sale of Railcars, (c) statutory Liens arising or incurred in the ordinary
course of business by operation of Law for which payment is not yet due and
payable or that are being contested in good faith by appropriate proceedings and
for which adequate reserves have been established in accordance with GAAP, and
(d) any other Liens that are listed on Schedule II attached hereto.
"Person" shall mean any individual, corporation, partnership,
association, joint-stock company, limited liability company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.
"Policy Claim Amount" shall mean, with respect to any Payment Date, the
amount payable in accordance with the terms of the Class A Note Policy equal to
the sum of (a) the amount, if any, by which Class A Note Interest (excluding any
Incremental Class A Interest and Class A Overdue Interest) due and payable to
Holders of the Class A Notes Outstanding on such Payment Date exceeds Available
Funds remaining on deposit in the Collection Accounts after the payment of all
amounts in clauses (i) through (x) of Section 12.02(d) or clauses (i) through
(x) of Section 6.08, as applicable) and after giving effect to (i) any required
transfers from the relevant Cash Collateral Account to pay such Class A Note
Interest and (ii) any Class A Note Insurer Optional Deposit made with respect to
such Payment Date, (b) if such Payment Date is also the Stated Legal Maturity
Date, the remaining unpaid Note Principal Balance of the Class A Notes after
taking into account all distributions of principal to be made with respect to
the Notes (pursuant to clauses (xiii) and (xiv) of Section 12.02(d) or clause
(xiii) of Section 6.08, as applicable) on such Payment Date and (c) any amounts
previously distributed by or on behalf of an Issuer to a Holder of a Class A
Note on such Class A Note that is recoverable and sought to be recovered as a
voidable preference by a bankruptcy trustee pursuant to the U.S. Bankruptcy Code
or the Bankruptcy and Insolvency Act (Canada), as amended from time to time, in
accordance with a final, non-appealable order of a court having competent
jurisdiction thereover.
"Policy Payment Account" shall mean the segregated trust account
established by and maintained in the name of the Indenture Trustee for the
benefit of the Holders and the Class A Note Insurer, established in accordance
with Section 12.05, which account shall constitute part of the Collateral.
"Predecessor Notes" shall have the meaning set forth in Section
3.03(c).
"Preference Claim" shall have the meaning set forth in Section
13.02(b).
"Preferred Lessee" shall have the meaning set forth in Section
11.14(b).
"Prefunded Amount" shall mean $3,482,000.
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"Prefunded Existing Lease" shall mean, any contract, agreement or other
arrangement between the owner of a Prefunded Railcar and any third party
providing for the lease, hire, operation or other use of such Prefunded Railcar
by or through such third party, including a Master Lease Agreement (each
schedule to a Master Lease Agreement, together with the terms of such Master
Lease Agreement, constituting a separate and independent lease), lease,
operating agreement, use agreement, a car hire contract or Per Diem Lease listed
on the Prefunded Lease and Railcar Schedule and sold to NARCAT on the Prefunded
Railcar Acquisition Date, including any riders, supplements and annexes thereto,
as the same may be amended, restated, supplemented or otherwise modified in
accordance with the terms hereof.
"Prefunded Lease and Railcar Schedule" shall have the meaning ascribed
thereto in the NARCAT Sale Agreement.
"Prefunded Railcar" shall mean any Railcar listed on the Prefunded
Lease and Railcar Schedule, which is to be acquired by NARCAT under the NARCAT
Sale Agreement (and which the U.S. Seller has become obligated to acquire after
the Closing Date, but prior to the Prefunded Account Expiration Date, pursuant
to the Asset Purchase Agreement).
"Prefunded Railcar Acquisition Date" shall mean the date of the
acquisition by NARCAT of the Prefunded Railcars and the Prefunded Existing
Leases.
"Prefunded Railcar Assets" shall mean any Railcar Assets as they apply
to any Prefunded Railcar.
"Prefunding Account" shall mean the segregated trust account maintained
in the name of the Indenture Trustee for the benefit of the Holders and the
Class A Note Insurer and established in accordance with Section 12.06, which
account shall constitute part of the Collateral.
"Prefunding Account Expiration Date" shall mean March 12, 2004.
"Premium" shall have the meaning ascribed thereto in the Premium
Letter.
"Premium Letter" shall have the meaning set forth in the Recitals.
"Prime Rate" shall mean the corporate base rate, prime rate or base
rate of interest, as applicable, pursuant to the Wall Street Journal or
successor publication from time to time, changing when and as such rate changes,
as reasonably determined by the Controlling Party.
"Proceeding" shall mean any suit in equity, action at law or other
judicial or administrative proceeding.
"Projected Appraised Value Date" shall mean January 30, 2011, the date
which is seven years from the Appraisal Date.
"Property Insurance" shall have the meaning set forth in Section
11.14(a)(i).
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"Purchase" shall have the meaning set forth in the Management
Agreement.
"Purchase Agreements" shall mean, collectively, the Class X-0/X-0
Xxxxxxxx Xxxxxxxxx, the Class A-3 Purchase Agreement and the Class B Purchase
Agreement.
"Purchase Price" shall have the meaning set forth in the Management
Agreement.
"Purchase Proceeds" shall mean, with respect to any Railcar and/or
Lease, the actual amount (a) deposited to the relevant Collection Account by the
Manager under Section 4.04(b) of the Management Agreement, (b) deposited to the
relevant Collection Account by the Servicer under Section 4.03(b) of the
Servicing Agreement, or (c) received by any Seller, the Manager, the Servicer or
any Issuer in satisfaction of an indemnity or repurchase obligation under the
Asset Purchase Agreement with respect to a Railcar and/or Lease (net of any
amounts required to be paid to Manager as described in Section 4.04(f) of the
Management Agreement).
"QIB" shall mean a "qualified institutional buyer" within the meaning
of Rule 144A.
"Railcar" or "Railcars" shall mean the railroad rolling stock and
locomotives identified on the Lease and Railcar Schedule from time to time,
including without limitation, all related parts, supplies, machinery, apparatus,
accessions, additions, improvements, fittings and things appurtenant thereto,
and other equipment or components of any nature from time to time incorporated
or installed therein and replacements thereof and substitutions therefor.
"Railcar Assets" shall mean, collectively:
(a) the Railcars, including all rights in the associated
registration numbers and marks;
(b) the Leases;
(c) all guaranties, if any, with respect to the Leases;
(d) the Lease Receivables;
(e) all warranties and maintenance agreements, if any,
with respect to the Railcars;
(f) the Lease Files;
(g) all intellectual property associated with the Leases,
Railcars and other Railcar Assets;
(h) all of the Seller's rights, title and interest in, to
and under the Asset Purchase Agreement with respect to the foregoing,
including all remedies thereunder for breaches of any representations,
warranties, covenants or agreements contained therein;
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(i) all documents, instruments, certificates, agreements
and books and records, including computer programs, evidencing or
otherwise relating to the foregoing;
(j) all Insurance Policies, including Insurance Proceeds
related to the foregoing; and
(k) all collections and other proceeds (including
insurance proceeds) of any of the foregoing.
"Railcar Entities" shall mean Progress Services Corporation, Railcar,
Ltd., Progress Rail Services De Mexico, S.A. de C.V. and 3079936 Nova Scotia
Company.
"Railcar Release Proceeds" shall mean the net proceeds deposited into
the relevant Collection Account as a result of an Issuer's obtaining the release
of a Railcar from the Lien of this Indenture in accordance with Section 8.02(a).
"Railcar Storage Agreement" shall have the meaning set forth in the
Management Agreement.
"Railroad Mileage Credits" shall mean the difference between (a)
amounts paid or payable to an Issuer or a Lessee under any Lease representing
compensation for use of the applicable Railcars by railroad companies or other
users thereof in accordance with applicable Car Hire Rules, Car Service Rules
and the Interchange Rules, and for Per Diem Leases shall include any estimated
payments and shortfall payments paid or, if guaranteed, payable by the Lessee
thereunder and, to the extent payable to such Issuer under such Per Diem Lease,
hourly and mileage rates prescribed for such Railcars registered in UMLER and
the car hire accounting rate master files of the AAR then in effect and (b)
amounts paid or payable by such Issuer under any Lease to such Lessee pursuant
to any revenue-sharing provisions thereof or other credits to which such Lessee
is entitled. For purposes of clarification, Railroad Mileage Credits do not
include any amounts payable under a Lease with respect to Events of Loss,
maintenance or indemnities thereunder.
"Rapid Amortization Event" shall mean the existence of any one or more
of the following events, as of any Payment Date, unless waived in writing by the
Controlling Party:
(a) after giving effect to the making of any Basic
Principal Payment and Supplemental Principal Payment on such Payment
Date, the Note Principal Balance of all Class A Notes Outstanding is
greater than the Maximum Class A Note Amount;
(b) any one or more of the following circumstances exists
for three or more consecutive Accounting Dates preceding such Payment
Date:
(i) for any calculation made with respect to
July 31, 2004, or any Accounting Date thereafter, the Monthly
Average Lease Rate is less than $200;
(ii) the Monthly Utilization Rate is 80% or less;
or
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(iii) for any calculation made with respect to
July 31, 2004, or any Accounting Date thereafter, the Coverage
Ratio is less than 1.15;
(c) after giving effect to the making of any Basic
Principal Payment and Supplemental Principal Payment on such Payment
Date, the Note Principal Balance of the Class A Notes then Outstanding
is greater than 90% of the Stated Value of all Eligible Railcars as of
the related Accounting Date;
(d) the occurrence of an event permitting the Controlling
Party to replace the Servicer or the Manager following the expiration
of all applicable cure periods;
(e) the occurrence of an Event of Default; or
(f) a breach of a Concentration Limit; provided that if
such breach is caused solely by (i) the downgrade or withdrawal of a
debt rating with respect to a Lessee, (ii) a merger, consolidation, or
other affiliation of a Lessee with another Lessee, or (iii) the
exercise of eminent domain, nationalization or other similar action by
any governmental agency or authority with respect to a Lessee, then
such breach shall not constitute a Rapid Amortization Event;
provided, however, that a Rapid Amortization Event will be deemed to be cured if
the event that gave rise to such Rapid Amortization Event shall no longer exist
with respect to three consecutive Payment Dates (otherwise it will be deemed to
continue to exist at all times after its occurrence unless waived, in writing,
by notice delivered to the Indenture Trustee and the Class A Note Insurer by the
Controlling Party).
"Rating Agencies" shall mean S&P and Fitch.
"Rating Agency Condition" shall mean, with respect to any action and a
Class of the Notes, that each Rating Agency with respect to such Class shall
have been given ten days' (or such shorter period as is acceptable to such
Rating Agency) prior notice thereof and that no Rating Agency shall have
notified the Issuers, the Servicer, the Class A Note Insurer or the Indenture
Trustee in writing that such action will result in a qualification, reduction or
withdrawal of its then-current rating.
"Record Date" shall mean, with respect to a Payment Date or a
Redemption Date, the last day of the related Collection Period, whether or not a
Business Day.
"Redemption Account" shall mean the segregated trust account
established by and maintained in the name of the Issuers for the benefit of the
Indenture Trustee on behalf of the Holders and the Class A Note Insurer,
established in accordance with Section 12.07, which account shall constitute
part of the Collateral.
"Redemption Date" shall mean the date fixed pursuant to Section 14.01.
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"Redemption Differential" means the positive difference, if any,
between (a) the applicable Redemption Prices for all Notes to be redeemed on the
Redemption Date and (b) the sum of the Remaining Cash Collateral Amounts and the
Issuer Retained Interest.
"Redemption Price" shall mean, as of any Redemption Date, the following
redemption prices (expressed as a percentage of the principal amount of the
Notes to be redeemed), plus accrued but unpaid interest on the Notes at the
applicable Note Interest Rate to the date fixed for redemption, in each case,
together with accrued but unpaid interest on the Notes:
REDEMPTION DATES REDEMPTION PRICE REDEMPTION PRICE
(BOTH DATES INCLUSIVE) OF CLASS A NOTES OF CLASS B NOTES
------------------------------------------------------------------------
February 2011 Payment Date through
January 2012 Payment Date 100% 108%
------------------------------------------------------------------------
February 2012 Payment Date through
January 2013 Payment Date 100% 104%
------------------------------------------------------------------------
February 2013 Payment Date and
thereafter 100% 100%
-------------------------------------------------------------------------
provided, however, that for a Clean-Up Call exercised with respect to any
Payment Date on or before the January 2011 Payment Date, the redemption price
will be 100% with respect to the Class A Notes and 110% with respect to the
Class B Notes, in each case, together with accrued but unpaid interest on the
Notes.
"Redemption Record Date" shall mean, with respect to any redemption of
Notes, the date fixed pursuant to Section 14.01.
"Registered Holder" shall mean, with respect to a Note, the Person
whose name appears on the Note Register on the applicable Record Date or
Redemption Record Date.
"Regular Supplemental Principal Payment" shall mean, with respect to
each Payment Date, the amount set forth in clause (a) of the definition of
Supplemental Principal Payment.
"Reimbursement Obligations" shall mean an amount equal to the sum of
(a) all amounts paid under the Class A Note Policy, less any payments under the
Class A Note Policy previously reimbursed pursuant to Section 12.02(d) or
Section 6.08, (b) any other amounts payable to the Class A Note Insurer under
the Insurance Agreement, the Premium Letter or any other Transaction Document
and (c) interest on the amounts stated above at a rate per annum equal to the
Overdue Rate (as defined in the Insurance Agreement).
"Reinvestment Income" shall mean any interest or other earnings earned
on all or part of the Collateral.
"Remaining Cash Collateral Amounts" shall mean, with respect to a
Redemption Date, all amounts that would remain on deposit in the Cash Collateral
Accounts after application to all amounts having a higher priority than the
Issuer Retained Interest in Section 12.02(d).
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"Rent" shall mean, as the context may require, with respect to all
Leases or with respect to each Lease, 100% of the periodic lease payments for
the Railcar leased under the Lease as specified on the Lease and Railcar
Schedule.
"Required CARCAT Cash Collateral Amount" shall mean, initially, the
Initial CARCAT Cash Collateral Deposit and, as of any Payment Date, shall mean
an amount equal to the greater of (a) eight (8) times the aggregate amount of
scheduled interest payable with respect to the Class A-3 Notes on such Payment
Date and (b) $500,000 for so long as any Class A Notes remain outstanding.
"Required NARCAT Cash Collateral Amount" shall mean, initially, the
Initial NARCAT Cash Collateral Deposit and, as of any Payment Date, shall mean
an amount equal to five (5) times the aggregate amount of scheduled interest
payable with respect to the Class A-1 and Class A-2 Notes on such Payment Date.
"Responsible Officer" shall mean, with respect to the Indenture
Trustee, any Senior Vice President, Vice President, Assistant Vice President or
Corporate Trust Officer assigned by the Indenture Trustee to administer its
corporate trust matters.
"Rule 144A" shall mean the rule designated as "Rule 144A" promulgated
by the Securities and Exchange Commission under the Securities Act.
"Rule 144A Global Note" shall mean the permanent global note,
evidencing Class A-1 Notes and Class A-2 Notes, in the form of the Class A-1
Note or Class A-2 Note attached hereto as Exhibit B-1 or Exhibit B-2, that is
deposited with and registered in the name of the Security Depository or its
nominee, representing the Class A-1 Notes or Class A-2 Notes sold in reliance on
Rule 144A.
"S&P" or "Standard & Poor's" shall mean Standard & Poor's Rating
Services, a division of The XxXxxx-Xxxx Companies, Inc., and its successors and
assigns.
"Sale" shall have the meaning set forth in Section 6.18.
"Sale Agreements" shall mean, collectively, (a) the NARCAT Sale
Agreement, (b) the CARCAT Sale Agreement and (c) the NARCAT Mexico Sale
Agreement.
"Scheduled Class B Payment" shall mean, with respect to each Payment
Date, an amount equal to the sum of (a) the lesser of (i) the Note Principal
Balance of all Outstanding Class B Notes, and (ii) with respect to each Payment
date before the Payment Date in August of 2004, zero, and with respect to each
Payment Date thereafter, $50,000, and (b) any Overdue Scheduled Class B
Payments.
"Scrapped Payment Amount" shall mean, as of any Payment Date, the
greater of $2,000 and the amount necessary to cause the Note Principal Balance
of the Class A Notes not to exceed 90% of the Stated Value of all Eligible
Railcars as of the related Accounting Date.
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"Scrapped Railcar" shall mean a Railcar designated by the Manager, on
behalf of the relevant Issuer, as no longer having utility for a reason other
than an Event of Loss.
"Secured Obligations" shall mean all amounts and obligations which the
Issuers may at any time owe to or on behalf of the Class A Note Insurer and the
Indenture Trustee for the benefit of the Holders under this Indenture, the Notes
and the other Transaction Documents.
"Secured Parties" shall mean, collectively, the Indenture Trustee, the
Holders of the Notes and the Class A Note Insurer.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Security Depository" shall mean DTC or any other organization
registered as a "Security Depository" pursuant to Section 17A of the Exchange
Act.
"Security Depository Participant" shall mean a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Security Depository effects book-entry transfers and pledges of securities
deposited with the Security Depository.
"Self-insure" and "self-insurance" shall have the meaning set forth in
Section 11.14(b).
"Seller" shall mean any of the U.S. Seller, the Canadian Seller or the
Mexican Seller, as the context may require.
"Servicer" shall mean the Person who shall have been appointed as
servicer pursuant to the applicable provisions of the Servicing Agreement until
a successor Person shall have been appointed as servicer and thereafter
"Servicer" shall mean such successor Person.
"Servicer Events of Termination" shall have the meaning set forth in
Section 6.01 of the Servicing Agreement.
"Servicer Fee" shall have the meaning set forth in the Servicing
Agreement.
"Servicing Agreement" shall mean the Servicing Agreement dated as of
February 12, 2004, by and among the Servicer, the Backup Servicer, the Indenture
Trustee and the Issuers, pursuant to which the Servicer will service and
administer the Collateral Granted to the Indenture Trustee hereunder, as the
same may be amended, restated, modified or supplemented from time to time in
accordance with the terms thereof.
"Solvent" shall mean with respect to any Person that as of the date of
determination both (a)(i) the then fair saleable value of the property of such
Person is (A) greater than the total amount of liabilities (including contingent
liabilities) of such Person and (B) not less than the amount that will be
required to pay the probable liabilities on such Person's then existing debts as
they become absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person, (ii) such Person's
capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction, and (iii) such Person does
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not intend to incur, or believe (nor should it reasonably believe) that it will
incur, debts beyond its ability to pay such debts as they become due; and (b)
such Person is "solvent" within the meaning given that term and similar terms
under applicable Laws relating to fraudulent transfers and conveyances. For
purposes of this definition, the amount of any contingent liability at any time
shall be computed as the amount that, in light of all of the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.
"Source of Funds Requirements" shall have the meaning set forth in
Section 12.02(f).
"Source Payments" shall have the meaning set forth in Section 14.01(a).
"Stated Legal Maturity Date" shall mean February 15, 2019.
"Stated Value" shall mean, as of any Accounting Date and with respect
to any Railcar, an amount equal to the Initial Appraised Value of such Railcar,
as reduced by the Appraised Value Reduction Factor.
"STB" shall mean the U.S. Surface Transportation Board.
"Subsequent Lease" shall mean any contract, agreement or other
arrangement between the owner of a Railcar and any third party providing for the
lease, hire, operation or other use of such Railcar by or through such third
party, other than a Prefunded Existing Lease, including a Master Lease Agreement
(each schedule to a Master Lease Agreement, together with the terms of such
Master Lease Agreement, constituting a separate and independent lease), lease,
operating agreement, use agreement, a car hire contract or Per Diem Lease,
entered into by an Issuer after the Closing Date which meets the requirements
of, and is entered into in accordance with, Section 11.15, including any riders,
supplements and annexes thereto, as the same may be amended, restated,
supplemented or otherwise modified in accordance with the terms hereof.
"Substitute Railcar" shall have the meaning set forth in the Management
Agreement.
"Successor Manager" shall have the meaning set forth in the Management
Agreement.
"Supplemental Manager Fee" shall have the meaning set forth in the
Management Agreement.
"Supplemental Principal Payment" shall mean, with respect to each
Payment Date:
(a) a supplemental principal payment on the Notes
consisting of the sum of (i) $100,000, (ii) for each Payment Date
beginning with the March 2004 Payment Date through and including the
February 2007 Payment Date, $83,333, (iii) the higher of (x) the net
proceeds received by the Issuers, the Sellers, the Manager or the
Servicer during the related Collection Period, whether from Insurance
Proceeds, the Lessees or otherwise, as a result of the sale or the
occurrence of any Event of Loss with respect to any Railcar, and (y)
the Stated Value of any such Railcar which shall have been sold or as
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to which an Event of Loss shall have occurred during the related
Collection Period, or, in the case of up to 630 Scrapped Railcars
(excluding locomotives) each of which may be sold during Collection
Periods ending on or before January 31, 2005, the Scrapped Payment
Amount, (iv) 90% of the Stated Value of each Prefunded Railcar not
purchased on or before the Prefunding Account Expiration Date, and (v)
any Deferred Supplemental Principal Payment Payments; plus
(b) if a Rapid Amortization Event exists and has not been
cured or waived on such Payment Date, all Available Funds remaining on
deposit in the Collection Accounts after the payment of the Regular
Supplemental Principal Payment.
"Tax Payment Amount" shall mean the amount required to pay all taxes,
including, without limitation, any income, withholding, excise, sales, gross
receipts, general corporation, tangible or intangible personal property,
privilege, or license taxes due and owing by any Issuer or by Holdco with
respect to the activities of such Issuer to any taxing authority in any
jurisdiction.
"Tax Payment Recipient" shall mean any taxing authority in any
jurisdiction, or any intermediary (which shall not be an Affiliate of any
Issuer) which has been irrevocably instructed by any Issuer or the Servicer to
pay Taxes on behalf of an Issuer.
"Taxes" shall mean any and all taxes, levies, imposts, duties,
assessments, charges and withholdings imposed or required to be collected by or
paid over to any Governmental Authority, including any interest, penalties,
fines, assessments or additions imposed with respect to the foregoing.
"The Andersons" shall mean The Andersons, Inc., an Ohio corporation,
and its permitted successors and assigns.
"Transaction Documents" shall mean, collectively, this Indenture, the
Servicing Agreement, the Management Agreement, the Sale Agreements, the Purchase
Agreements, the Lockbox Agreements, the Asset Purchase Agreement (and any
associated documents), the Class A Note Policy, the Insurance Agreement, the
Premium Letter, the Funds Transfer Agreement, the Intercompany Advance Agreement
and the Notes, and all documents, agreements, instruments and certificates
executed in connection with any of the foregoing.
"Triple Net Lease" shall mean, as of the date of determination, any
Lease identified as such on the then current Lease and Railcar Schedule.
"Tripped Concentration Limit" shall have the meaning set forth in
Section 11.15(c).
"Trustee Fee" shall mean the fees of the Indenture Trustee set forth in
that certain fee letter, dated February 12, 2004, and acknowledged on February
12, 2004, by the Issuers.
"UMLER" shall mean the Universal Machine Language Equipment Register
maintained by the AAR.
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"U.S. Article 9 Assets" shall mean all Article 9 Assets which the U.S.
Seller purports to transfer to NARCAT pursuant to the NARCAT Sale Agreement.
"U.S. Filed Documents" shall mean those documents filed with the STB
within 10 days of the Closing Date pursuant to Section 2.03(h) of the Management
Agreement.
"U.S. Seller" shall mean Cap Acquire, LLC, a Delaware limited liability
company, and its permitted successors and assigns.
"U.S. Tax Code" shall have the meaning set forth in Section 3.11(b).
"Vice President" shall mean, with respect to any Person, any vice
president, whether or not designated by a number or a word or words added before
or after the title "vice president."
Section 1.02. Terms Defined in the Servicing Agreement, Sale Agreements or
Management Agreement. For the purposes of this Agreement, capitalized terms used
but not otherwise defined herein shall have the respective meanings assigned to
such terms in the Servicing Agreement or, if not defined therein, in the Sale
Agreements or, if not defined therein, in the Management Agreement, as
applicable.
Section 1.03. Interpretation. For all purposes of this Indenture, except
as otherwise expressly provided or unless the context otherwise requires, (a)
terms used in this Indenture include, as appropriate, all genders and the plural
as well as the singular, (b) references to this Indenture include all Exhibits
and Schedules hereto, (c) references to words such as "herein," "hereof" and the
like shall refer to this Indenture as a whole and not to any particular part,
Article or Section within this Indenture, (d) references to an Article or
Section such as "Article I" or "Section 1.01" shall refer to the applicable
Article or Section of this Indenture, (e) the term "include" and all variations
thereof shall mean "include without limitation," (f) the term "or" shall include
"and/or," (g) the term "proceeds" shall have the meaning ascribed to such term
in the UCC or the Personal Property Security Act (Nova Scotia), as applicable,
(h) any defined term which relates to a document shall include within its
definition any amendments, modifications, renewals, restatements, extensions,
supplements or substitutions permitted hereunder which have been or are
hereafter executed and delivered in accordance with the terms thereof, (i) any
defined term which relates to a Person shall include within its definition the
successors and permitted assigns of such Person, (j) in the computation of a
period of time from a specified date to a later specified date, the word "from"
shall mean "from and including" and the words "to" and "until" shall mean "to
but excluding," and (k) any defined term which relates to a statute or code or
section of such statute or code shall include within its definition any
successor statute or code or section thereof, as applicable.
ARTICLE II
NOTE FORM
Section 2.01. General. (a) The Notes shall be designated as Class A-1
Notes, Class A-2 Notes, Class A-3 Notes and Class B Notes. The Class A-3 Notes
shall be issued solely to
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Holders who are residents of Canada for the purposes of the Canadian Tax Act,
and any transfers of the Class A-3 Notes shall be limited to Persons who are
such residents; provided, however, that this requirement shall not apply to the
Class A Note Insurer to the extent that it may succeed to the interest of a
Holder of a Class A-3 Note following payment of a claim under the Class A Note
Policy.
(b) All payments of principal and interest made by the Issuers
with respect to the Notes shall be made only from the Collateral and, with
respect to the Class A Notes, the Class A Note Policy, on the terms and
conditions specified herein.
(c) Except as otherwise provided herein, all Notes shall be
substantially identical in all respects. Except as specifically provided herein,
all Notes issued, authenticated and delivered under this Indenture shall be in
all respects equally and ratably entitled to the benefits hereof without
preference, priority or distinction on account of the actual time or times of
authentication and delivery, all in accordance with the terms and provisions of
this Indenture.
(d) The aggregate original stated principal balance of the Class
A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and Class B Notes that may
be executed by an Authorized Officer of each of the Issuers and authenticated
and delivered by the Indenture Trustee and Outstanding at any given time under
this Indenture is limited to $29,000,000, $21,000,000, $31,400,000 and
$5,000,000, respectively.
(e) Holders of the Notes shall be entitled to payments of interest
as provided herein. The Notes shall have a final maturity on the Stated Legal
Maturity Date. All Notes of the same Class shall be secured on a parity with one
another, with no Note of any Class having any priority over any other Note of
that same Class.
(f) The Notes that are authenticated and delivered to the Holders
by the Indenture Trustee upon an Issuer Order on the Closing Date shall be dated
as of the Closing Date. Any Note issued later in exchange for, or in replacement
of, any Note issued on the Closing Date shall be dated the date of its
authentication.
(g) Each Note is issuable in the minimum denomination of
$1,000,000, and integral multiples of $100,000 in excess thereof; provided that
one Note of each Class may be issued in an additional amount equal to any
remaining portion of the aggregate original stated principal balance of the
Notes of such Class.
Section 2.02. Forms of Notes. The Notes shall be in substantially the form
set forth in Exhibit X-0, Xxxxxxx X-0, Exhibit B-3 and Exhibit B-4, as
applicable, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
Issuers, as evidenced by their execution thereof.
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The Definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods, all as determined by
the officers executing such Notes, as evidenced by their execution of such
Notes.
Each Note shall be dated the date of its authentication. The terms of
the Notes are set forth in Exhibit X-0, Xxxxxxx X-0, Exhibit B-3 and Exhibit
B-4, and are part of the terms of this Indenture.
The Notes are being offered and sold by the Issuers to the Initial
Purchasers pursuant to the Purchase Agreements. The Class A-1 Notes and Class
A-2 Notes shall initially be issued as Global Notes and the Class A-3 Notes and
Class B Notes shall be issuable as Definitive Notes.
(a) Global Notes. The Class A-1 Notes and Class A-2 Notes offered
and sold by the Class A-1/A-2 Initial Purchaser to QIBs in reliance on Rule 144A
shall be issued initially in the form of Rule 144A Global Notes, which shall be
deposited on behalf of the purchasers of the Class A-1 Notes and Class A-2 Notes
represented thereby with the Indenture Trustee, as custodian for the Security
Depository, and registered in the name of the Security Depository or a nominee
of the Security Depository, duly executed by the Issuers and authenticated by
the Indenture Trustee as hereinafter provided. The aggregate principal amount of
the Rule 144A Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Indenture Trustee and the Security
Depository or its nominee as hereinafter provided. The Indenture Trustee shall
not be liable for any error or omission by the Security Depository in making
such record adjustments and the records of the Indenture Trustee shall be
controlling with regard to the Note Principal Balance of Class A-1 Notes and
Class A-2 Notes hereunder.
Each Global Note shall represent such of the Outstanding Class A-1
Notes or Class A-2 Notes as shall be specified therein and each shall provide
that it shall represent the aggregate amount of Outstanding Class A-1 Notes and
Class A-2 Notes from time to time endorsed thereon and that the aggregate amount
of Outstanding Class A-1 Notes and Class A-2 Notes represented thereby may from
time to time be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the amount of Outstanding Class A-1 Notes and Class A-2
Notes represented thereby shall be made by the Indenture Trustee, or by the Note
Registrar at the direction of the Indenture Trustee, in accordance with
instructions given by the Holder thereof.
Except as set forth in Section 3.06, the Global Notes may be
transferred, in whole and not in part, only to another nominee of the Security
Depository or to a successor of the Security Depository or its nominee.
(b) Book-Entry Provisions. This Section 2.02(b) shall apply only
to the Rule 144A Global Notes deposited with or on behalf of the Security
Depository.
The Issuers shall execute and the Indenture Trustee shall, in
accordance with this Section 2.02(b), authenticate and deliver one Global Note
for the Class A-1 Notes and one Global Note for the Class A-2 Notes which (i)
shall be registered in the name of the Security
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Depository or the nominee of the Security Depository and (ii) shall be delivered
by the Indenture Trustee to the Security Depository or pursuant to the Security
Depository's instructions or held by the Indenture Trustee as custodian for the
Security Depository.
Agent Members shall have no rights either under this Indenture with
respect to any Global Note held on their behalf by the Security Depository or by
the Indenture Trustee as custodian for the Security Depository or under such
Global Note, and the Security Depository may be treated by the Issuers, the
Indenture Trustee and the Class A Note Insurer and any agent of the Issuers, the
Indenture Trustee or the Class A Note Insurer as the absolute owner of such
Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Issuers, the Indenture Trustee or the Class A Note
Insurer or any agent of the Issuers, the Indenture Trustee or the Class A Note
Insurer from giving effect to any written certification, proxy or other
authorization furnished by the Security Depository or impair, as between the
Security Depository and its Agent Members, the operation of customary practices
of such Security Depository governing the exercise of the rights of a Note
Owner.
The Note Registrar, the Indenture Trustee and the Class A Note Insurer
shall be entitled to treat the Security Depository for all purposes of this
Indenture (including the payment of principal of and interest on the Class A-1
Notes and Class A-2 Notes and the giving of instructions or directions
hereunder) as the sole Holder of the Class A-1 Notes and Class A-2 Notes, and
shall have no obligation to the Note Owners of Class A-1 Notes or Class A-2
Notes.
The rights of Note Owners of Class A-1 Notes and Class A-2 Notes shall
be exercised only through the Security Depository and shall be limited to those
established by law and agreements between such Note Owners of Class A-1 Notes
and Class A-2 Notes and the Security Depository and/or the Agent Members
pursuant to the Note Depository Agreement. The initial Security Depository will
make book-entry transfers among the Agent Members and receive and transmit
payments of principal of and interest on the Class A-1 Notes and Class A-2 Notes
to such Agent Members with respect to such Global Notes.
Whenever this Indenture requires or permits actions to be taken based
upon instructions or directions of Holders of Class A Notes evidencing a
specified percentage of the Outstanding amount of the Class A Notes, the
Security Depository shall be deemed to represent such percentage only to the
extent that it has received instructions to such effect from Note Owners of
Class A-1 Notes or Class A-2 Notes and/or Agent Members owning or representing,
respectively, such required percentage of the beneficial interest in the Notes
and has delivered such instructions to the Indenture Trustee.
(c) Definitive Notes. Except as provided in this Section 2.02 and
in Sections 3.06 and 3.10, Holders of the Class A-1 Notes and Class A-2 Notes
will not be entitled to receive physical delivery of Definitive Notes. Holders
of the Class A-3 Notes and the Class B Notes will only be entitled to receive
Definitive Notes, and will not be entitled to hold such Notes as Book-Entry
Notes at any time.
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ARTICLE III
TERMS OF NOTES; TRANSFERS
Section 3.01. Payment of Principal and Interest. (a) Principal payments on
the Notes, to the extent that Available Funds are available for the payments
thereof, in an amount equal to the Basic Principal Payment and the Supplemental
Principal Payment will be made on each Payment Date to the Holders in accordance
with Section 12.02(d) and Section 6.08.
(b) Each Class of Notes shall be entitled to receive payments of
interest on their respective Note Principal Balances on each Payment Date as
provided herein at the Class A-1 Note Interest Rate, the Class A-2 Note Interest
Rate, the Class A-3 Note Interest Rate or the Class B Note Interest Rate, as
applicable, from the Closing Date until the Note Principal Balance of each such
Class is reduced to zero or until payment is provided therefor as set forth in
Article XIV. After the initial Payment Date, payments of interest accrued on
each Class of Notes and payable on each Payment Date will be calculated on the
Note Principal Balance of each Class of Notes as of the immediately preceding
Payment Date after giving effect to any payments of principal on such
immediately preceding Payment Date. With respect to the initial Payment Date,
interest will be calculated on the Note Principal Balance of each Class of Notes
from the Closing Date through the day preceding the initial Payment Date. All
computations of interest accrued on any Note shall be made on the basis of a
360-day year consisting of 12 thirty-day months.
(c) If the entire amount of the Class A-1 Note Interest, Class A-2
Note Interest, Class A-3 Note Interest or Class B Note Interest that is due on
any Payment Date shall not have been punctually made or duly provided for when
and as due (after giving effect to any applicable cure or grace period), then
interest on the applicable Overdue Interest shall accrue (to the extent
permitted by law), from the date such amount was due until paid, at the Class
A-1 Note Interest Rate, Class A-2 Note Interest Rate, Class A-3 Note Interest
Rate or the Class B Note Interest Rate, as applicable.
(d) The rights of the Holders of the Class B Notes to receive
payments of principal and interest in respect of the Class B Notes on any
Payment Date, Stated Maturity Date or Redemption Date shall be subordinated to
the rights of the Holders of Class A Notes to receive payments of principal and
interest in respect of the Class A Notes on such Payment Date, Stated Maturity
Date or Redemption Date and certain other payments as set forth in Section
12.02(d) and Section 6.08.
Section 3.02. Payments to Holders. (a) Holders of Notes of each Class
shall, subject to the priorities and conditions set forth in Section 12.02(d) or
Section 6.08, be entitled to receive payments of interest and principal on each
Payment Date (including any Overdue Interest, Overdue Basic Principal Payments
and Deferred Supplemental Principal Payments). Any payment of interest or
principal payable with respect to the Notes on the applicable Payment Date shall
be made to the Person in whose name such Note is registered at the close of
business on the Record Date for such Payment Date in the manner provided in
Section 3.02(c).
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(b) All reductions in the Note Principal Balance of a Note (or one
or more Predecessor Notes) effected by payments of principal made on any Payment
Date shall be binding upon all Holders of such Note and of any Note issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof,
whether or not such payment is noted on such Note.
(c) The Indenture Trustee shall pay to each Holder of record as of
the related Record Date either (i) by wire transfer, in immediately available
funds to the account of such Holder at a bank or other entity having appropriate
facilities therefor, if such Holder shall have provided to the Indenture Trustee
appropriate written instructions at least five Business Days prior to related
Payment Date (which instructions shall remain in effect for subsequent Payment
Dates unless revoked by such Holder), or (ii) if the Indenture Trustee has not
received timely written instructions regarding the account of a Holder, by check
mailed to such Holder at the address of such Holder appearing in the Note
Register, the amounts to be paid to such Holder pursuant to such Holder's Notes;
provided, that so long as the Notes are registered in the name of the Security
Depository such payments shall be made to the nominee thereof in immediately
available funds.
(d) Unless the Controlling Party otherwise directs in the case of
an acceleration of the Notes following the occurrence of an Event of Default,
(a) all payments of principal and interest with respect to the Class A-1 Notes,
the Class A-2 Notes and the Class B Notes shall be payable solely from amounts
held in the NARCAT Collection Account or, in the case of the Class A-1 Notes and
the Class A-2 Notes, from amounts funded under the Class A Note Policy, and (b)
all payments of principal and interest with respect to the Class A-3 Notes shall
be payable solely from amounts held in the CARCAT Collection Account or from
amounts funded under the Class A Note Policy.
Section 3.03. Execution, Authentication, Delivery and Dating. (a) The Notes
shall be executed by an Authorized Officer of each of the Issuers. The signature
of each such Authorized Officer on the Notes may be manual or facsimile. Notes
bearing the manual or facsimile signature of any individual who was, at the time
of execution thereof, an Authorized Officer of an Issuer, shall bind such
Issuer, notwithstanding the fact that such individual ceased to hold such office
prior to the authentication and delivery of such Notes or did not hold such
office at the date of issuance of such Notes.
(b) At any time and from time to time after the execution and
delivery of this Indenture, the Issuers may deliver Notes executed by an
Authorized Officer of each of the Issuers to the Indenture Trustee for
authentication, and the Indenture Trustee, upon receipt of the Notes and of an
Issuer Order, shall authenticate and deliver such Notes; provided, however, that
the Indenture Trustee shall not authenticate the Notes on the Closing Date
unless and until it shall have received the documents listed in Section 4.01.
(c) Notes issued upon transfer, exchange or replacement of other
Notes (such other Notes, "Predecessor Notes") shall be issued in authorized
denominations reflecting the Note Principal Balance so transferred, exchanged or
replaced, but shall represent only the Note Principal Balance so transferred,
exchanged or replaced. In the event that any Note is divided
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into more than one Note in accordance with this Article III, such Note Principal
Balance shall be divided among the Notes delivered in exchange therefor.
(d) No Note shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Note a
certificate of authentication, substantially in the form provided for herein,
executed by the Indenture Trustee by the manual signature of a Responsible
Officer of the Indenture Trustee, and such executed certificate upon any Note
shall be conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered.
Section 3.04. Temporary Notes. Except for Book-Entry Notes, temporary
Notes shall be issuable in any authorized denomination, and substantially in the
form of the Definitive Notes but with such omissions, insertions and variations
as may be appropriate for temporary Notes, all as may be determined by the
Issuers. Every such temporary Note shall be executed by an Authorized Officer of
each of the Issuers and authenticated by the Indenture Trustee upon the same
conditions and in substantially the same manner, and with the same effect, as
the Definitive Notes. Without unreasonable delay the Issuers will execute and
deliver to the Indenture Trustee Definitive Notes (other than in the case of
Notes in global form) and thereupon any or all temporary Notes (other than in
the case of Notes in global form) may be surrendered in exchange therefor, at
the Corporate Trust Office, and the Indenture Trustee shall authenticate and
deliver in exchange for such temporary Notes an equal aggregate principal amount
of Definitive Notes. Such exchange shall be made by the Issuers at their own
expense and without any charge therefor. Until so exchanged, the temporary Notes
shall in all respects be entitled to the same benefits and subject to the same
limitations under this Indenture as Definitive Notes authenticated and delivered
hereunder.
Section 3.05. Registration, Registration of Transfer and Exchange. (a) The
Indenture Trustee (the "Note Registrar") shall cause to be kept at its Corporate
Trust Office a register (the "Note Register"), in which, subject to such
reasonable regulations as it may prescribe, the Indenture Trustee shall provide
for the registration of the Notes and the registration of transfers of such
Notes.
If a Person other than the Indenture Trustee is appointed by the
Issuers as Note Registrar, the Issuers will give each of the Indenture Trustee,
the Class A Note Insurer and the Holders prompt written notice of the
appointment of such Note Registrar and of the location, and any change in the
location, of the Note Register. The Indenture Trustee, the Class A Note Insurer
and each Holder shall have the right to inspect the Note Register at all
reasonable times and to obtain copies thereof. The Indenture Trustee, the Class
A Note Insurer and each Holder shall have the right to rely upon a certificate
executed on behalf of the Note Registrar by a Responsible Officer thereof as to
the names and addresses of the Holders and the principal amounts and the amounts
and number of such Notes.
(b) Each Person who has or who acquires any Ownership Interest in
a Note shall be deemed by the acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the provisions of this Section 3.05.
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(c) Each purchaser of Class A-1 Notes, Class A-2 Notes and Class B
Notes will be deemed to have represented and agreed as follows (terms used in
this section that are defined in Rule 144A or the Securities Act are used herein
as defined therein):
(i) The purchaser understands that the Notes
will be offered and may be resold by the Initial Purchasers only to
QIBs pursuant to Rule 144A.
(ii) The purchaser is (i) purchasing the Notes
for its own account or an account with respect to which it exercises
sole investment discretion, (ii) a QIB, and any such account is a QIB,
(iii) aware that the sale to it is being made in reliance on Rule 144A,
and (iv) (or such account is) acquiring such Notes for investment and
not with a view to, or for offer or sale in connection with, any
distribution or fractionalization thereof or with any intention of
reselling the Notes or any part thereof, subject to any requirement of
law that the disposition of its property or the property of such
account or accounts be at all times within its or their control and
subject to its or their ability to resell such Notes pursuant to Rule
144A.
(iii) The purchaser understands that the Notes
have not been registered under the Securities Act, and that if in the
future it decides to reoffer, resell, pledge or otherwise transfer such
Notes it will do so only (i) pursuant to Rule 144A to a person whom the
seller reasonably believes is a QIB in a transaction meeting the
requirements of Rule 144A, purchasing for its own account or for the
account of a QIB, whom the Holder has informed that such reoffer,
resale, pledge or other transfer is being made in reliance on Rule 144A
or to the Issuers pursuant to the terms of this Indenture, or (ii)
pursuant to another exemption available under the Securities Act as
evidenced by an opinion of counsel acceptable to the Issuers and the
Indenture Trustee.
(iv) The purchaser understands that the Notes
will bear legends to the following effect unless the Issuers determine
otherwise consistent with applicable Law:
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES (1)
THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY
PURSUANT (A) TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON WHOM THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER ("QIB")
WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS
OWN ACCOUNT, OR A QIB PURCHASING FOR THE ACCOUNT OF A
QIB, IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A OR TO AN ISSUER PURSUANT TO THE TERMS OF
THE INDENTURE OR (B) PURSUANT TO ANOTHER EXEMPTION
AVAILABLE UNDER THE SECURITIES ACT AS EVIDENCED BY AN
OPINION OF COUNSEL ACCEPTABLE TO THE INDENTURE
TRUSTEE AND THE ISSUERS, AND (2) THAT IT WILL DELIVER
TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST
HEREIN IS TO BE
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TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND. THE INDENTURE RELATED TO THIS NOTE
CONTAINS A PROVISION REQUIRING THE INDENTURE TRUSTEE
TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE OR
ANY INTEREST HEREIN IN VIOLATION OF THE FOREGOING.
EACH TRANSFEREE ACCEPTING A BENEFICIAL INTEREST IN
THIS NOTE IS DEEMED TO REPRESENT TO THE ISSUERS THAT
IT IS EITHER A QIB PURCHASING FOR ITS OWN ACCOUNT, A
QIB PURCHASING FOR THE ACCOUNT OF ANOTHER QIB OR A
PERMITTED TRANSFEREE AS SPECIFIED IN THE
ABOVE-REFERENCED OPINION OF COUNSEL.
THE INFORMATION CONTAINED IN THIS NOTE IS THE
EXCLUSIVE RESPONSIBILITY OF THE ISSUERS AND HAS NOT
BEEN REVIEWED OR APPROVED BY THE NATIONAL BANKING AND
SECURITIES COMMISSION OF MEXICO (COMISION NACIONAL
BANCARIA Y DE VALORES DE MEXICO). THE REGISTRATION IN
THE SPECIAL SECTION OF THE NATIONAL SECURITIES
REGISTRY, HANDLED BY THE NATIONAL BANKING AND
SECURITIES COMMISSION OF MEXICO, DOES NOT IMPLY
CERTIFICATION CONCERNING THE VALIDITY OF THE NOTES OR
THE SOLVENCY OF THE ISSUERS.
THE NOTES HAVE NOT BEEN REGISTERED IN THE SECURITIES
SECTION OF THE MEXICAN NATIONAL SECURITIES REGISTRY,
AND, THEREFORE, THEY ARE NOT SUBJECT TO A PUBLIC
OFFERING OR PLACEMENT IN MEXICO. ANY MEXICAN INVESTOR
WHO ACQUIRES ANY OF THE NOTES WILL DO SUCH UNDER ITS
OWN RESPONSIBILITY.
(v) If the purchaser is acquiring any Note as a
fiduciary or agent for one or more investor accounts, it represents
that it has sole investment discretion with respect to such account and
that it has full power to make the acknowledgments, representations and
agreements contained herein on behalf of each such account.
(vi) The purchaser is a QIB purchasing for its
own account or for the account of another QIB and it, and such other
person (if applicable), are aware that the sale to it is being made in
reliance on Rule 144A.
(vii) The purchaser acknowledges that transfers of
the Notes shall otherwise be subject in all respects to the
restrictions applicable thereto contained in this Indenture.
(viii) Either (A) that the purchaser (or the
account, as applicable) will not acquire the Notes with the assets of
any "employee benefit plan" as defined in Section 3(3) of ERISA which
is subject to Title I of ERISA or any "plan" as defined in Section 4975
of the U.S. Tax Code (each such entity, a "Benefit Plan") or (B) no
non-exempt "prohibited transaction" under Section 406 of ERISA or
Section 4975 of the U.S.
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Tax Code will occur in connection with the purchaser's or such
account's acquisition or holding of the Notes.
(ix) The purchaser acknowledges that (A) none of
the Issuers, the Manager, the Servicer, the Initial Purchasers, the
Class A Note Insurer or any person representing any of them has made
any representation to it with respect to the Issuers, the Manager, the
Servicer, the Class A Note Insurer or the offering of the Notes other
than the information which is contained in the Offering Memorandum, and
(B) the purchaser has had access to such financial and other
information concerning the Issuers, the Manager, the Servicer, the
Class A Note Insurer and the offering of the Notes as it has deemed
necessary in connection with its decision to purchase the Notes,
including an opportunity to ask questions of and request information
from the relevant Initial Purchaser, the Issuers, the Manager, and the
Servicer.
(x) The purchaser acknowledges that the Issuers,
the Initial Purchasers and others will rely on the truth and accuracy
of the foregoing acknowledgments, representations and agreements, and
agrees that if any of the foregoing acknowledgments, representations
and agreements deemed to have been made by it are no longer accurate,
it shall promptly notify the Issuers and the applicable Initial
Purchaser.
In addition to the above representations, each purchaser of Class B
Notes will also be deemed to have represented and agreed that, notwithstanding
anything in the Indenture to the contrary, no transfer or issuance of any Class
B Note or any interest in any Issuer or any direct or indirect interest therein
shall be made (i) that would result in there being more than one hundred (100)
owners in the aggregate of the Class B Notes and equity owners of any of the
Issuers, or (ii) to any beneficial owner of an interest in a partnership,
grantor trust or S corporation (herein referred to as a "Flow-through entity")
which Flow-through entity's ownership, directly or indirectly through other
Flow-through entities, of Notes constitutes fifteen percent (15%) or more,
measured by value, of such Flow-through entity's assets. The purchaser either
acknowledges that it is not a Flow-through entity, or, if it is a Flow-through
entity, it shall provide a description of the structure of such Flow-through
entity to the Issuers on its Investment Letter.
(d) Each purchaser of Class A-3 Notes in Canada will be required
to execute an Investment Letter in the form attached as Exhibit A-2 prior to
purchasing Class A-3 Notes. Each purchaser of Class A-3 Notes will also be
deemed to have represented and agreed as follows:
(i) The purchaser is a resident of Canada for
the purposes of the Income Tax Act (Canada).
(ii) The purchaser is a resident of one of the
provinces or territories of Canada and is a person or company to whom
the Class A-3 Notes may be offered and sold in reliance upon an
exemption from the prospectus requirements of the securities
legislation of one or more of the provinces or territories in which the
offering and sale of the Class A-3 Notes is, or is deemed to be, taking
place.
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(iii) The purchaser is a "qualified institutional
buyer" as defined in Rule 144A.
(iv) The purchaser is basing its investment
decision solely on the Canadian Offering Memorandum and not on any
other information concerning the Issuers or the Offering.
(v) The purchaser has reviewed and acknowledges
the terms referred to under the heading "Resale Restrictions" in the
Canadian Offering Memorandum.
(e) Other than with respect to Book-Entry Notes, at the option of
a Holder, Notes may be exchanged for other Notes of any authorized denominations
and of a like Note Principal Balance and Class upon surrender of the Notes to be
exchanged at the Corporate Trust Office. Whenever any Notes are so surrendered
for exchange, the Issuers shall execute, and the Indenture Trustee shall
authenticate and deliver, the Notes which the Holder making the exchange is
entitled to receive.
(f) Other than with respect to Book-Entry Notes, any Note
presented or surrendered for registration of transfer or exchange shall be duly
endorsed, or be accompanied by a written instrument of transfer substantially in
the form of the assignment included as part of Exhibit X-0, X-0, X-0 or B-4
hereto duly executed. All Notes issued upon any registration of transfer or
exchange of Notes shall be the valid, joint and several obligations of the
Issuers, evidencing the same rights, and entitled to the same benefits under
this Indenture, as the Class of Notes surrendered upon such registration of
transfer or exchange. No service charge shall be made for any registration of
transfer or exchange of Notes, but the Issuers and the Indenture Trustee may
require payment of a sum sufficient to cover any tax or other governmental
charge as may be imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges pursuant to Section 3.06 not involving
any transfer.
The Notes have not been and will not be registered under the Securities
Act, and, except for the registration with the Special Section of the Mexican
National Securities Registry (Registro Nacional de Valores or RNV), the Notes
will not be registered or qualified (including any qualification by prospectus
for distribution to the public) under the securities laws of any state, Canadian
province or other jurisdiction. The Notes generally may be transferred only to a
QIB. In addition, the Class A-3 Notes may be transferred only to Persons who are
residents of Canada for purposes of the Canadian Tax Act and meet certain
requirements under applicable Canadian securities legislation.
Section 3.06. Transfer and Exchange. (a) The transfer and exchange of
Global Notes or beneficial interests therein shall be effected through the
Security Depository, in accordance with this Indenture and the procedures of the
Security Depository therefor, which shall include restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Beneficial interests in a Global Note may be transferred to persons who
take delivery thereof in the form of a beneficial interest in the same Global
Note in accordance with the transfer restrictions set forth in the legend in
subsection (c)(iv) of Section 3.05.
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(b) Transfer and Exchange from Definitive Notes to Definitive
Notes. When Definitive Notes are presented by a Holder to the Note Registrar
with a request:
(i) to register the transfer of Definitive Notes
in the form of other Definitive Notes; or
(ii) to exchange such Definitive Notes for an
equal principal amount of Definitive Notes of other authorized
denominations, the Note Registrar shall register the transfer or make
the exchange as requested; provided, however, that the Definitive Notes
presented or surrendered for register of transfer or exchange:
(A) shall be duly endorsed or
accompanied by a written instruction of transfer in
form satisfactory to the Note Registrar duly executed
by such Holder or by his attorney, duly authorized in
writing;
(B) if such Definitive Note is being
transferred to a QIB in accordance with Rule 144A, a
certification to that effect from such Holder (in
substantially the form of Exhibit A-1 or Exhibit A-2,
as applicable, hereto); or
(C) if such Definitive Note is being
transferred in reliance on any other exemption from
the registration requirements of the Securities Act,
a certification to that effect from such Holder (in
substantially the form of Exhibit A-1 or Exhibit A-2,
as applicable, hereto) and an opinion of counsel from
such Holder or the transferee reasonably acceptable
to the Issuers, the Class A Note Insurer (in the case
of a proposed transfer of a Class A Note and so long
as no Class A Note Insurer Default shall have
occurred and is continuing) and the Indenture Trustee
to the effect that such transfer is in compliance
with the Securities Act.
(D) in the case of a transfer of the
Class A-3 Notes, such transfer shall be to a resident
of Canada for the purposes of the Income Tax Act
(Canada) and pursuant to an exemption order for the
prospectus requirements of the securities legislation
of the provinces or territories in Canada in which
such transaction is taking place.
(c) Restrictions on Transfer and Exchange of Global Notes.
Notwithstanding any other provision of this Indenture, a Global Note may not be
transferred as a whole except by the Security Depository to a nominee of the
Security Depository or by a nominee of the Security Depository to the Security
Depository or another nominee of the Security Depository or by the Security
Depository or any such nominee to a successor Security Depository or a nominee
of such successor Security Depository.
(d) Other than as specified in the Purchase Agreements, the
Initial Purchasers shall not be required to deliver, and neither the Issuers nor
the Indenture Trustee shall demand therefrom, any of the certifications or
opinions described in this Section 3.06 in connection with the initial issuance
of the Notes and the delivery thereof by the Issuers.
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Section 3.07. Mutilated, Destroyed, Lost or Stolen Notes. (a) If (i) any
mutilated Note is surrendered to the Indenture Trustee or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by the Indenture Trustee to hold each of the
Issuers and the Indenture Trustee harmless, then, in the absence of actual
notice to the Issuers or the Indenture Trustee that such Note has been acquired
by a bona fide purchaser, the Issuers shall execute, and the Indenture Trustee
shall authenticate and deliver upon an Issuer Order, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Note, a new Note or Notes of
the same tenor and Class and principal balance bearing a number not
contemporaneously outstanding; provided, however, that if any such mutilated,
destroyed, lost or stolen Note shall have become subject to receipt of payment
in full, instead of issuing a new Note, the Indenture Trustee may make a payment
with respect to such Note without surrender thereof, except that any mutilated
Note shall be surrendered. If, after the delivery of such new Note or payment
with respect to a destroyed, lost or stolen Note pursuant to the proviso to the
preceding sentence, a bona fide purchaser of the original Note in lieu of which
such new Note was issued presents for receipt of payments such original Note,
the Issuers, the Class A Note Insurer (in the case of any Class A Note) and the
Indenture Trustee shall be entitled to recover such new Note (or such payment)
from the Person to whom it was delivered or any Person taking such new Note from
such Person, except a bona fide purchaser, and each of the Issuers, the Class A
Note Insurer (in the case of any Class A Note) and the Indenture Trustee shall
be entitled to recover upon the security or indemnity provided therefor to the
extent of any loss, damage or cost incurred by the Issuers, the Class A Note
Insurer or the Indenture Trustee in connection therewith.
(b) Upon the issuance of any new Note under this Section 3.07, the
Issuers or the Indenture Trustee may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto.
(c) Every new Note issued pursuant to this Section 3.07 in lieu of
any destroyed, lost or stolen Note shall constitute an original additional joint
and several contractual obligation of the Issuers, whether or not the destroyed,
lost or stolen Note shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Notes duly issued hereunder.
(d) The provisions of this Section 3.07 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment with respect to mutilated, destroyed, lost or stolen
Notes.
Section 3.08. Persons Deemed Holders. Before due presentment for
registration of transfer of any Note, the Issuers, the Class A Note Insurer, the
Indenture Trustee and any agent of any Issuer, the Class A Note Insurer or the
Indenture Trustee may treat the Person in whose name any Note is registered or
in whose name any beneficial interest of a Note is registered pursuant to
Section 3.05 as the owner of such Note (a) on the applicable Record Date for the
purpose of receiving payments with respect to principal and interest on such
Note and (b) on any date for all other purposes whatsoever, whether or not such
Note be overdue, and none of the Issuers, the Class A Note Insurer, the
Indenture Trustee nor any agent of any Issuer, the Class A Note Insurer or the
Indenture Trustee shall be affected by any notice to the contrary.
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Section 3.09. Cancellation of Notes. All certificated Notes surrendered for
payment, registration of transfer, exchange or prepayment shall, if surrendered
to any Person other than the Indenture Trustee, be delivered to the Indenture
Trustee and shall be promptly canceled by it; provided, that no Class A Note
shall be canceled if such payment is made from funds paid under the Class A Note
Policy until the Class A Note Insurer has confirmed to the Indenture Trustee in
writing that it has received all Reimbursement Obligations. The Issuers may at
any time deliver to the Indenture Trustee for cancellation any Note previously
authenticated and delivered hereunder which the Issuers may have acquired in any
manner whatsoever, and all Notes so delivered shall be promptly canceled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes canceled as provided in this Section 3.09 except as expressly
permitted by this Indenture. All canceled Notes shall be held and disposed of by
the Indenture Trustee in accordance with its standard retention and disposal
policy.
Section 3.10. Definitive Notes. The Class A-3 Notes and the Class B Notes
will be issued as Definitive Notes and will not at any time that such Notes are
Outstanding be issued to the Securities Depository or its nominee. The Class A-1
Notes and Class A-2 Notes will be issued as Definitive Notes, rather than to the
Securities Depository or its nominee, only if (a) the Issuers advise the Note
Registrar in writing that the Securities Depository is no longer willing or able
to discharge properly its responsibilities as the Securities Depository with
respect to the Book-Entry Notes and the Issuers are unable to locate a qualified
successor, (b) the Issuers, at their option, elect to terminate the book-entry
system through the Securities Depository or (c) after the occurrence of an Event
of Default, Holders representing at least a majority of the outstanding
principal amount of the Class A-1 Notes or the Class A-2 Notes, as applicable,
advise the Issuers through the Securities Depository in writing that the
continuation of a book-entry system through the Securities Depository (or a
successor thereto) is no longer in such Holders' best interest. Upon the
occurrence of any of the events described in this paragraph, the Issuers will be
required to notify the Note Registrar, and the Note Registrar will be required
to notify all Holders of Class A-1 Notes and Class A-2 Notes through
participants of the availability of Definitive Notes. Upon surrender by the
Securities Depository of its Book-Entry Notes and receipt of instructions for
reregistration, the Issuers will reissue the Book-Entry Notes as Definitive
Notes to the Class A-1 Holders and Class A-2 Holders in the amounts specified in
the reregistration instructions.
Section 3.11. Tax Treatment. (a) The Issuers have structured the
transactions represented by this Indenture and the Notes with the intention that
the Notes be treated, for all purposes, as indebtedness. Each Holder by its
acquisition of a Note agrees, for all purposes, to treat the Notes as
indebtedness. Each provision of the Indenture, the Purchase Agreements and the
Notes shall be construed in accordance with this intention, and no party to the
Indenture or a Purchase Agreement and no Holder shall take, fail to take or
permit to be taken any act that may be inconsistent with this statement of
intention. Without limiting the generality of the preceding sentence, under no
circumstances will any of the Issuers, the Indenture Trustee or the Holders
elect to treat any Issuer as a corporation for U.S. federal income tax purposes;
further, an election shall be filed to cause NARCAT Mexico to be treated as a
disregarded entity (or, if contrary to the intent of the parties, the Notes were
determined not to constitute indebtedness for federal income tax purposes, as a
partnership) for U.S. federal income tax purposes.
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(b) No ownership interest in any Note or shall be issued, sold,
transferred, listed or otherwise exchanged at any time on an established
securities market, including (i) a national securities exchange registered under
the Securities Exchange Act of 1934, as amended (the "1934 Act") or exempted
from registration because of the limited volume of transactions; (ii) a foreign
securities exchange that, under the law of the jurisdiction where it is
organized, satisfied regulatory requirements that are analogous to the
regulatory requirements under the 1934 Act applicable to exchanges described in
clause (i); (iii) a regional or local exchange; or (iv) an over-the-counter
market, as the terms in clauses (i), (ii), (iii) and (iv) are defined for
purposes of Section 7704 of the Internal Revenue Code of 1986, as amended (the
"U.S. Tax Code").
(c) Notwithstanding anything in the Indenture to the contrary, no
transfer or issuance of any Class B Note or any interest in any Issuer or any
direct or indirect interest therein shall be made (i) that would result in there
being more than one hundred (100) owners in the aggregate of the Class B Notes
and equity owners of any of the Issuers, or (ii) to any beneficial owner of an
interest in a partnership, grantor trust or S corporation (herein referred to as
a "Flow-through entity") which Flow-through entity's ownership, directly or
indirectly through other Flow-through entities, of Notes constitutes fifteen
percent (15%) or more, measured by value, of such Flow-through entity's assets.
(d) Based upon representations made by the Issuers, no "interests
in real property," secure the Notes. The term "interests in real property"
includes fee ownership and co-ownership of land or improvements thereon,
leaseholds of land or improvements thereon, options to acquire land or
improvements thereon, and options to acquire leaseholds of land or improvements
thereon. The term also includes timeshare interests that represent an undivided
fractional fee interest, or undivided leasehold interest, in real property, and
that entitle the holders of the interests to the use and enjoyment of the
property for a specified period of time each year. The term "real property"
means land or improvements thereon, such as buildings or other inherently
permanent structures thereon (including items which are structural components of
such buildings or structures). In addition, the term "real property" includes
interests in real property. Local law definitions will not be controlling for
purposes of determining the meaning of the term "real property." The term
includes, for example, the wiring in a building, plumbing systems, central
heating or central air-conditioning machinery, pipes or ducts, elevators or
escalators installed in the building, or other items which are structural
components of building or other permanent structure. The term does not include
assets accessory to the operation of a business, such as machinery, printing
press, transportation equipment which is not a structural component of the
building, office equipment, refrigerators, individual air-conditioning units,
grocery counters, furnishings of a motel, hotel, or office building, etc., even
though such items may be termed fixtures under local law.
(e) Each purchaser shall, on or prior to the date the first
payment becomes due after the date that it becomes a purchaser, and thereafter
within 30 days after requested in writing by NARCAT or the Indenture Trustee and
within a reasonable period of time (but in no event later than the day before
the date of the next payment due to such purchaser on the Notes) after a change
in the information on any form previously delivered, provide NARCAT and the
Indenture Trustee with (i) if such purchaser is a "United States person" under
Section 7701(a)(30) of the U.S. Tax Code (other than a purchaser who is a
corporation whose
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name contains the words "insurance company," "reinsurance company," "assurance
company," "Corporation" or "Inc.") a properly completed Internal Revenue Service
Form W-9 or any successor form prescribed by the Internal Revenue Service or
(ii) if such purchaser is not a "United States person" under Section 7701(a)(30)
of the U.S. Tax Code, (x) a properly completed Internal Revenue Service Form
W-8BEN or any successor form prescribed by the Internal Revenue Service,
certifying that such purchaser is entitled to benefits under an income tax
treaty to which the United States is a party which provides a complete exemption
from United States withholding taxes, (y) a properly completed Internal Revenue
Service Form W-8ECI or any successor form prescribed by the Internal Revenue
Service, certifying that the income receivable under the Notes or any other
Transaction Document is effectively connected with the conduct by such Person of
a trade or business in the United States or (z) if such purchaser is not a
"bank" within the meaning of Section 881(c)(3)(A) of the U.S. Tax Code, a
certificate substantially in the form of Exhibit D-1 or D-2, as applicable,
completed Internal Revenue Service Form W-8BEN or any successor form prescribed
by the Internal Revenue Service, certifying that such purchaser is not a United
States person under Section 7701(a)(30) of the U.S. Tax Code; provided that if
there is a change in the information on any form previously delivered by a
purchaser and such purchaser is not eligible to provide any replacement form
(and if applicable, replacement certificate) hereunder, such purchaser shall
notify NARCAT and the Indenture Trustee of such event no later than the day
before the date of the next payment due to such purchaser on the Notes. In
regard to any non-U.S. holder of a Note that is treated as a partnership for
U.S. income tax purposes, the above requirements shall be satisfied by the
beneficial owners of interests in such non-U.S. holder (looking through partners
that are foreign intermediaries or flow-through entities).
(f) The Indenture Trustee shall not file any election under
Treasury Regulations Section 301.7701-3 to cause the Indenture to be treated as
an association taxable as a corporation.
Section 3.12. Withholding Taxes. (a)(i) The Issuers agree to make interest
payments to the Holders so that the net amounts received by the Holders, after
the withholding of any taxes ("Mexican Withholding Taxes") required by Mexico's
Federal Income Tax Law on interest payments made by NARCAT Mexico, will equal
the amounts that the Holders would have received if no withholding had been
required, and (ii) NARCAT Mexico agrees to pay to the Mexican taxing authorities
(as a portion of Tax Payment Amounts in Section 6.08 or Section 12.02(d), as
applicable) such amounts as shall be required to comply with NARCAT Mexico's
obligation to pay Mexican Withholding Taxes on a timely basis.
(b) If either (i) a court or the Internal Revenue Service
determines that Taxes must be withheld on interest payments made by NARCAT to
Holders who are nonresidents and who are not citizens of the United States, or
(ii) Taxes must be withheld on interest payments made by CARCAT to Holders who
are not residents of Canada within the meaning of the Canada Tax Act, then
payments of interest to such nonresident Holders will be reduced to the extent
required to pay such taxes, notwithstanding any other provision of this
Indenture.
(c) The Class A Note Policy does not cover any shortfalls
resulting from withholding tax liability or interest or penalties in respect of
such liability.
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ARTICLE IV
AUTHENTICATION AND DELIVERY OF NOTES; POST-CLOSING FILINGS
Section 4.01. General Provisions. The Notes shall be executed by Authorized
Officers of each of the Issuers and delivered to the Indenture Trustee for
authentication and thereupon the same shall be authenticated and delivered by
the Indenture Trustee upon an Issuer Order upon receipt by the Indenture Trustee
of the following:
(a) copies of each of the Transaction Documents, duly
executed and delivered by each of the parties thereto (other than the
Indenture Trustee);
(b) a Board Resolution of each of the Issuers, the
Servicer, the Manager and each Seller authorizing, as applicable, the
execution, delivery and performance of the Transaction Documents to
which it is a party and the transactions contemplated thereby;
(c) a certificate or other official document evidencing
any authorization, approval or consent of each government body or
bodies required for valid issuance of such Notes or the execution,
delivery and performance of any of the Transaction Documents;
(d) one or more Opinions of Counsel with respect to each
Issuer, each Seller, Holdco, the Servicer and the Manager, as
applicable (which may rely upon one or more Officer's Certificates from
the related Person as to matters of fact and which may be based on such
assumptions and subject to such exceptions, limitations and
qualifications as are customarily contained in opinions of this nature)
substantially to the effect that, and with such modifications as may be
necessary under the laws of Canada and Mexico, (i) such Person has been
duly formed and is validly existing and in good standing under the laws
of the respective jurisdiction identified in this Indenture and is duly
qualified to do business in said jurisdiction and has the power and
authority to enter into and perform its obligations under the
Transaction Documents to which such Person is a party; (ii) this
Indenture and each other Transaction Document to which such Person is a
party (other than the Notes) has been duly authorized, executed and
delivered by such Person and constitutes the valid, legal and binding
agreement of such Person, enforceable in accordance with its terms;
(iii) with respect to each Issuer, the Notes have been duly authorized
by such Issuer and, when issued and authenticated in accordance with
the terms of the Indenture, will be valid and binding, joint and
several obligations of the Issuers enforceable in accordance with their
terms; (iv) the execution, delivery and performance by such Person of
its obligations under the Indenture, the Notes or any other Transaction
Document to which such Person is a party will not conflict with or
violate any of the organizational documents of such Person or any
applicable Law or order, rule or regulation of any court,
administrative agency or other governmental authority having
jurisdiction over such Person; (v) no consent, approval or
authorization of any governmental authority is required for the
execution and delivery by such Person of the Indenture, the Notes or
any other Transaction Document to which such Person is a party except
as shall have been therefore received and except as may be required
under the
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securities or "blue sky" laws of various jurisdictions in connection
with the delivery of the Notes; (vi) such Person has full power and
authority to assign, pledge, hypothecate and deposit all of its right,
title and interest in and to the Leases, the Railcars and the other
Collateral owned thereby to the Issuers, in the case of the Sellers,
and to the Indenture Trustee, in the case of the Issuers, free from any
Lien (other than any Permitted Lien), security interest, encumbrance or
other right, title or interest of any person, subject, however, to the
rights of the Lessees in the Railcars under the related Leases; (vii)
to the extent Article 9 of the UCC is applicable, the Indenture,
together with the filing of UCC-1 financing statements in the filing
offices to be identified in such opinion or opinions is effective to
Grant to and create in favor of the Indenture Trustee for the benefit
of the Secured Parties as security for the Notes, a perfected security
interest in the Leases, the Railcars and the other Collateral owned by
such Issuer; (viii) the offer and sale of the Notes under the
circumstances contemplated by each Purchase Agreement is exempt from
the registration requirements of the Securities Act, and no
qualification of the Indenture is required under the Trust Indenture
Act of 1939, as amended; and (ix) with respect to each Issuer, such
Issuer is not an "investment company" required to register as such
under the Investment Company Act of 1940, as amended;
(e) an Opinion of Counsel with respect to certain matters
relating to filings required to be made with the STB in respect of the
security interest of the Indenture Trustee in each Railcar and any
related Existing Lease (other than Excepted Leases) (which opinions may
rely upon one or more Officer's Certificates from the related Issuer as
to matters of fact and which may be based on such assumptions and
subject to such exceptions, limitations and qualifications as are
customarily contained in opinions of this nature) and substantially to
the effect that (a) the U.S. Filed Documents have been prepared for
filing with the STB in compliance with the relevant STB Filings
Requirements; (b) except for the filing of the U.S. Filed Documents, no
consent, approval, authorization or order of, or registration with, the
STB or with any other governmental authority or regulatory body is
required with respect to perfection of the assignments of the Existing
Leases and the security interest in the Existing Leases and the
Railcars contemplated by the Indenture; (c) other than the U.S. Filed
Documents and such exceptions as may be agreed upon by the Class A Note
Insurer, no document evidencing a Lien and encumbrance on, or security
interest in, the Initial Railcars appears in the recordation files and
records maintained by the STB pursuant to the relevant STB filing
requirements; and (d) under the relevant STB filing requirements, upon
the STB's recordation of the U.S. Filed Documents, such filing and
recordation constitutes notice to, and such U.S. Filed Documents will
be enforceable against, all persons (subject to such exceptions as may
be agreed upon by the Class A Note Insurer and no other filing,
depositing, registering or recording under any law of the United
States, a state within the United States (or its political
subdivisions) or territory or possession of the United States, is
necessary to protect the interests of the parties to the U.S. Filed
Documents in the Initial Railcars, and no re-recording, re-filing or
re-registering of any of the foregoing documents with the STB is
necessary to continue such notice and enforceability under present law
and regulations;
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(f) an Opinion of Counsel with respect to certain matters
relating to filings required to be made with the Canadian Regulator in
respect of the security interest of Indenture Trustee in each Canadian
Railcar and Canadian Lease (which opinions may rely upon one or more
Officer's Certificates from CARCAT as to matters of fact and which may
be based upon such assumptions and subject to such exceptions,
limitations and qualifications as are customarily contained in opinions
of this nature) and substantially to the effect that
(i) the Canadian Filed Documents have been
prepared for filing with the Canadian Regulator in compliance
with the requirements of the Canadian Regulator;
(ii) the deposit of the Canadian Filed Documents
will protect the rights of the Indenture Trustee in and to the
Canadian Railcars and Canadian Leases and no other filing,
recording, deposit or registration is necessary in Canada or
in any province or territory thereof to protect such rights;
(iii) the Canadian Filed Documents are valid
against all persons; and
(iv) no document evidencing a currently
outstanding lease, mortgage, hypothec, bailment or security
interest or any amendment or assignment thereto was located in
the database maintained by the Canadian Regulator with respect
to the Railcars;
(g) an Opinion of Counsel (which may rely upon one or
more Officer's Certificates as to matters of fact and which may be
based on such assumptions and subject to such exceptions, limitations
and qualifications as are customarily contained in opinions of this
nature) substantially to the effect that, in the event that The
Andersons were to become a debtor under the bankruptcy laws of the
United States or Canada, a court would not order the substantive
consolidation of Holdco, any Seller or any Issuer with any such debtor;
(h) an Officer's Certificate of each Issuer stating that
such Issuer is not in Default under this Indenture and there is no
Event of Default hereunder and that the issuance of the Notes will not
result in any breach of any of the terms, conditions or provisions of,
or constitute a default under, such Issuer's Certificate of Formation
or other corporation formation document, as applicable, or operating
agreement or other organizational or constitutional document, as
applicable, or any indenture, mortgage, deed of trust or other
agreement or instrument to which such Issuer is a party or by which
such Issuer is bound, or any order of any court or administrative
agency entered in any Proceeding to which such Issuer is a party or by
which it may be bound or to which it may be subject; and that all
conditions precedent provided in this Indenture relating to the
authentication and delivery of the Notes have been complied with and an
Officer's Certificate of each Seller to the effect that all of such
Seller's representations and warranties in the Sale Agreements were
accurate as of the time made;
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(i) a copy of an officially certified document, dated not
more than 30 days prior to the Closing Date, evidencing the due
organization and good standing of each Issuer, the Servicer, the
Manager and each Seller in their respective jurisdictions of
incorporation or formation, as applicable;
(j) copies of the corporate formation documents of each
Issuer, the Servicer, the Manager and each Seller;
(k) the initial Lease and Railcar Schedule;
(l) except in respect of those Leases identified on
Schedule IV hereto, the sole original executed counterpart of each
Lease, including any amendments or modifications thereto, subject to
such exceptions as shall have been approved by the Controlling Party,
as provided in Section 7.13 (and the Indenture Trustee shall have
delivered to the Servicer, the Manager, the Issuers, the Class A Note
Insurer and the Holders a certificate in the form attached hereto as
Exhibit C to the effect that the Indenture Trustee has received each
such Lease);
(m) evidence that the Indenture Trustee has established
the Collection Accounts, the Cash Collateral Accounts, the Operating
Expense Reserve Account (including the NARCAT OER Subaccount and the
CARCAT OER Subaccount), the Prefunding Account and the Policy Payment
Account (including the NARCAT Policy Payment Subaccount and the CARCAT
Policy Payment Subaccount) and evidence of the funding of the Cash
Collateral Accounts and the Prefunding Account;
(n) a certificate from each Issuer to the effect that, in
the case of each Lease, Railcar and other Railcar Assets being
transferred pursuant to its related Sale Agreement immediately prior to
the delivery thereof to the Indenture Trustee:
(i) each Issuer (A) is the owner of each Lease
and Railcar transferred to it pursuant to its respective Sale
Agreement free from any Lien, security interest, encumbrance
or other right, title or interest of any Person known to the
Issuer, other than the rights of the Lessee or sublessee under
the Lease and the security interest assigned to the Indenture
Trustee pursuant to the Indenture, (B) has not assigned any
interest or participation in such Lease or Railcar (or, if any
such interest or participation has been assigned, it has been
released), and (C) has full right to Grant such Lease and
Railcar to the Indenture Trustee;
(ii) the information set forth with respect to
each such Lease, Railcar and other Railcar Assets transferred
to it pursuant to its respective Sale Agreement in the initial
Lease and Railcar Schedule is correct in all material
respects;
(iii) the Issuer has Granted to the Indenture
Trustee all of its right, title, and interest in each Lease,
Railcar and other Railcar Assets transferred to it pursuant to
its respective Sale Agreement; and
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(iv) each lease, railcar and other related asset
transferred to it pursuant to its respective Sale Agreement
constitutes a Lease, Railcar or Railcar Asset;
(o) a rating letter issued by each of the Rating Agencies
to the Issuers, the Class A Note Insurer and the Indenture Trustee
assigning a rating to the Class A Notes of "AAA" by S&P and "AAA" by
Fitch and a rating to the Class B Notes of "B" by S&P;
(p) such lien searches and releases of liens as the
Indenture Trustee or the Class A Note Insurer deems necessary to
establish that the Non-Mexican Collateral of each Issuer and the Seller
(including, without limitation, the Non-Mexican Collateral owned by
each Issuer on the Closing Date) are free and clear of any Liens other
than Permitted Liens;
(q) appraisals of the Railcars issued by RailSolutions,
Inc., and X. X. Xxxxx & Associates, Inc., together with letters
reaffirming the values set forth therein as of January 30, 2004; and
(r) such other documents as the Indenture Trustee, the
Class A Note Insurer or the Holders may reasonably require.
Section 4.02. Post-Closing Filings. Each Issuer shall file, or cause to
be filed, no later than the Closing Date, the applicable UCC financing
statements described below:
(a) to perfect the U.S. Seller's transfer pursuant to the
NARCAT Sale Agreement of its interest in the U.S. Article 9 Assets to
NARCAT, a UCC financing statement in Delaware (the state in which the
U.S. Seller is organized), naming the U.S. Seller as debtor, NARCAT as
intermediate assignor and the Indenture Trustee as secured party;
(b) to perfect NARCAT's pledge of its interest in the
U.S. Article 9 Assets to the Indenture Trustee pursuant to the
Indenture, a UCC financing statement in Delaware (the state in which
NARCAT is organized), naming NARCAT as debtor and the Indenture Trustee
as secured party;
(c) to perfect (to the extent effective) the Canadian
Seller's transfer pursuant to the CARCAT Sale Agreement of its interest
in the Canadian Article 9 Assets to CARCAT, a UCC financing statement
in each of the District of Columbia and Ohio, naming the Canadian
Seller as debtor, CARCAT as intermediate assignor and the Indenture
Trustee as secured party;
(d) to perfect (to the extent effective) CARCAT's pledge
of its interest in the Canadian Article 9 Assets to the Indenture
Trustee pursuant to the Indenture, a UCC financing statement in each of
the District of Columbia and Ohio, naming CARCAT as debtor and the
Indenture Trustee as secured party;
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(e) to perfect (to the extent effective) the Mexican
Seller's transfer pursuant to the NARCAT Mexico Sale Agreement of its
interest in the Mexican Article 9 Assets to NARCAT Mexico, a UCC
financing statement in each of the District of Columbia and Ohio,
naming the Mexican Seller as debtor, NARCAT Mexico as intermediate
assignor and the Indenture Trustee as secured party;
(f) to perfect (to the extent effective) NARCAT Mexico's
pledge of its interest in the Mexican Article 9 Assets to the Indenture
Trustee pursuant to the Indenture, a UCC financing statement in each of
the District of Columbia and Ohio, naming NARCAT Mexico as debtor and
the Indenture Trustee as secured party;
(g) to perfect the transfer to the Canadian Seller
pursuant to the Asset Purchase Agreement of its interest in the
Canadian Railcars and Canadian Leases, a financing statement filed
pursuant to the Personal Property Security Act (Nova Scotia) naming
3079936 Nova Scotia Company as assignor/debtor and the Canadian Seller
as assignee/secured party;
(h) to perfect the Canadian Seller's transfer pursuant to
the CARCAT Sale Agreement of its interest in the Canadian Railcars and
Canadian Leases to CARCAT, a financing statement filed pursuant to the
laws of the Personal Property Security Act (Nova Scotia) naming the
Canadian Seller as assignor/debtor and CARCAT as assignee/secured
party; and
(i) to perfect CARCAT's pledge of its interest in the
Canadian Railcars and Canadian Leases to the Indenture Trustee pursuant
to the Indenture, a financing statement pursuant to the Personal
Property Security Act (Nova Scotia) naming CARCAT as debtor and the
Indenture Trustee as secured party.
ARTICLE V
SATISFACTION AND DISCHARGE
Section 5.01. Satisfaction and Discharge of Indenture. This Indenture shall
cease to be of further effect (except as to any surviving rights of registration
of transfer and exchange or payment) with respect to any Notes and the Indenture
Trustee, on demand of and at the expense of the Issuers, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with
respect to such Notes and shall pay, assign, transfer and deliver to the Issuers
upon an Issuer Order acknowledged and agreed to in writing by the Controlling
Party all cash, securities and other property held by it as part of the
Collateral (except for amounts required to pay and discharge the entire
remaining indebtedness of the Notes), when
(a) either
(i) all Notes theretofore authenticated and
delivered (other than (A) Notes which have been destroyed,
lost or stolen and which have been replaced or paid as
provided in Section 3.07, and (B) Notes for whose payment
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money has theretofore been deposited in trust as provided in
Section 11.03) have been delivered to the Indenture Trustee
for cancellation; or
(ii) all Notes not theretofore delivered to the
Indenture Trustee for cancellation have become due and payable
and the Issuers have irrevocably deposited or caused to be
deposited with the Indenture Trustee, in trust for the
purpose, an amount sufficient to pay and discharge the
principal amount, interest and premium, if any, due on such
Notes not theretofore delivered to the Indenture Trustee for
cancellation; and
(b) payment in full of (i) all fees and expenses of the
Indenture Trustee, the Servicer, the Manager, the Backup Servicer and
the Backup Manager, (ii) all amounts owing to the Class A Note Insurer
(including, without limitation, any early termination fee payable under
the Insurance Agreement) and (iii) all other obligations of the Issuers
under the Transaction Documents.
Section 5.02. Application of Trust Money. Subject to the last paragraph of
Section 11.03, all monies deposited with the Indenture Trustee pursuant to
Section 5.01 shall be held in trust and applied by it, in accordance with the
provisions of the Notes and this Indenture, to the payment, either directly or
through any Paying Agent as the Indenture Trustee may determine, to the Persons
entitled thereto, of the principal and interest for whose payment such money has
been deposited with the Indenture Trustee; but such money need not be segregated
from other funds except to the extent required herein or to the extent required
by law.
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.01. Events of Default. "Event of Default," wherever used herein,
means any one of the following events:
(a) failure of the Issuers to make any payment of
interest on the Class A Notes when due on any Payment Date or, if no
Class A Notes shall then be Outstanding, failure of the Issuers to make
any payment of interest on the Class B Notes when due on any Payment
Date;
(b) after giving effect to all Basic Principal Payments,
any Supplemental Principal Payments, and any Scheduled Class B Payments
made on any Payment Date, the Note Principal Balance of all Notes is
greater than the Stated Value of all Eligible Railcars as of the
immediately preceding Accounting Date;
(c) default in the performance, or breach, of any
material covenant, agreement, or other obligation of any Issuer in any
Transaction Document or any representation or warranty (other than a
covenant or warranty default in the performance of which or breach of
which is specifically dealt with elsewhere in this Section 6.01) of any
Issuer in any Transaction Document proves to be incorrect at the time
made in any
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material respect, and continuance of such default or breach for a
period of 30 days after the earlier of (i) actual knowledge by any of
the Issuers, the Manager or the Servicer or (ii) there shall have been
given to the Issuers by the Indenture Trustee or to the Issuers and the
Indenture Trustee by the Controlling Party, a written notice specifying
such default or breach and requiring it to be remedied and stating that
such notice is a "Notice of Default" hereunder;
(d) the entry of a decree or order for relief by a court
having jurisdiction over any Issuer under the United States Bankruptcy
Code or in a Canadian Insolvency Proceeding or any other applicable
federal, state or foreign bankruptcy or insolvency law, or appointing a
receiver, liquidator, assignee, trustee, or sequestrator (or other
similar official) of such Issuer or of any substantial part of its
property, or ordering the winding up or liquidation of its affairs, and
the continuance of any such involuntary decree or involuntary order
unstayed and in effect for a period of 30 consecutive days;
(e) the institution by any Issuer of Proceedings to be
adjudicated bankrupt or insolvent, or the consent by it to the
institution of bankruptcy or insolvency Proceedings against it, or the
filing by it of a petition or answer or consent seeking reorganization
or relief under the United States Bankruptcy Code or any other
applicable federal, state or foreign law, the commencement of a
Canadian Insolvency Proceeding by or against any Issuer or the consent
by it to the filing of any such petition or to the appointment of a
receiver, liquidator, assignee, trustee or sequestrator (or other
similar official) of such Issuer or of any substantial part of its
property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay
its debts generally as they become due, or the taking of action by any
Issuer in furtherance of any such action;
(f) the Indenture shall cease to be in full force and
effect or the Liens in existence and in connection therewith cease to
be valid, first priority perfected security interests in the Issuers'
interests in the Non-Mexican Collateral, subject only to Permitted
Liens;
(g) any Issuer becomes required to register as an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended;
(h) a writ of attachment or similar action or process has
been filed against a Collection Account, a Cash Collateral Account, the
Operating Expense Reserve Account (including the NARCAT OER Subaccount
or the CARCAT OER Subaccount), the Policy Payment Account (including
the NARCAT Policy Payment Subaccount or the CARCAT Policy Payment
Subaccount), the Prefunding Account or any Lockbox Account, or any
other component of the Collateral and such writ or other action or
process shall not have been stayed or dismissed within 30 days from the
entry thereof;
(i) entry of final judgment of a court of competent
jurisdiction against any of the Issuers in an amount exceeding
$1,000,000, which judgment remains unsatisfied and unstayed for a
period exceeding 30 days from the entry thereof;
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(j) NARCAT becomes subject to taxation as an association
(or publicly traded partnership) taxable as a corporation, or any other
Issuer becomes subject to taxation as an association (or publicly
traded partnership) under the U.S. Tax Code;
(k) any draw on the Class A Note Policy;
(l) failure to have repaid any Note in full on the Stated
Legal Maturity Date;
(m) the occurrence of a reportable event (within the
meaning of Section 4043 of ERISA) with respect to any Benefit Plan, or
the occurrence of any event or condition with respect to a Benefit Plan
which reasonably could be expected to result in the imposition of a
Lien on all or part of any Collateral;
(n) a Manager Event of Termination has occurred and is
continuing and (i) the Backup Manager has not assumed the duties of
Manager and (ii) the Controlling Party is unable to find an acceptable
replacement Manager who succeeds to the role of "Manager" within 30
days after the Indenture Trustee gives notice of such termination as
provided in the Management Agreement;
(o) a Servicer Event of Termination has occurred and is
continuing and (i) the Backup Servicer has not assumed the duties of
Servicer and (ii) the Controlling Party is unable to find an acceptable
replacement Servicer who succeeds to the role of "Servicer" within 30
days after the Indenture Trustee gives notice of such termination as
provided in the Servicing Agreement; or
(p) any failure to pay income or withholding taxes
following notice to an Issuer from the relevant governmental agency and
the expiration of any statutory grace periods, which has given rise to
the ability of a relevant governmental agency to perfect a governmental
Lien on all or any material part of the Collateral.
Section 6.02. Acceleration of Maturity; Rescission and Annulment. If an
Event of Default pursuant to Section 6.01(a)-(c) or (f)-(p) occurs and is
continuing, then and in every such case the Indenture Trustee with the consent
of the Controlling Party may, and at the direction of the Controlling Party
shall, declare the principal of all the Notes to be immediately due and payable,
by a notice in writing to the Issuers, the Class A Note Insurer and the Holders.
Upon any such declaration such principal shall become immediately due and
payable without any presentment, demand, protest or other notice of any kind
(except such notices as shall be expressly required by the provisions of this
Indenture), all of which are hereby expressly waived. If an Event of Default
pursuant to Section 6.01(d) or (e) occurs and is continuing, then in such case
the principal of all the Notes shall be automatically due and payable without
any presentment, demand, protest or other notice of any kind (an "Automatic
Acceleration").
At any time after such a declaration of acceleration has been made, but
before any Sale of the Collateral has been made or a judgment or decree for
payment of the money due has been obtained by the Indenture Trustee as
hereinafter in this Article VI provided, the Controlling Party, by written
notice to the Issuers and the Indenture Trustee, may rescind and annul such
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declaration and its consequences (except that in the case of (A) a default (i)
in payment of interest when due or (ii) in payment of principal on the Stated
Legal Maturity Date with respect to the Class A Notes (unless the payment in
question has been made by the Class A Note Insurer pursuant to the Class A Note
Policy) or, (B) if no Class A Notes are Outstanding, a payment default on the
Class B Notes, the consent of all of the Holders of such Class shall be required
to rescind and annul such a declaration and its consequences) if
(a) the Issuers have paid or deposited with the Indenture
Trustee a sum sufficient to pay:
(i) all interest which has been become due and
payable on all Class A Notes or, if no Class A Notes are
Outstanding, the Class B Notes,
(ii) the principal of any Class A Notes or, if no
Class A Notes are Outstanding, the Class B Notes, which has
become due otherwise than by such declaration of acceleration
and interest thereon at the rate borne by such Notes,
(iii) to the extent that payment of such interest
is lawful, interest upon Overdue Interest on the Notes at the
rate borne by such Notes to the date of such payment or
deposit, and
(iv) all sums paid or advanced by the Indenture
Trustee, the Class A Note Insurer or any Holder hereunder and
the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee, the Class A Note Insurer
and the Holders, their agents and counsel to the date of such
payment or deposit;
and
(b) all Events of Default, other than the nonpayment of
the principal of the Notes which have become due solely by such
declaration of acceleration, have been cured or waived as provided in
Section 6.15.
No such rescission shall affect any subsequent default or impair any
right consequent thereon.
Section 6.03. Payment Obligations upon Acceleration. Each Issuer covenants
that if an Event of Default shall occur and be continuing with respect to any
Notes, and the Notes have been declared due and payable and such declaration has
not been rescinded and annulled, or there has been an Automatic Acceleration,
the Issuers will, upon demand of the Indenture Trustee (acting at the direction
of the Controlling Party), pay to the Indenture Trustee, for the benefit of the
Holders of Notes and the Class A Note Insurer, the whole amount then due and
payable on such Notes for principal and interest, with interest upon any Overdue
Basic Principal Payment and Deferred Supplemental Principal Payment and, to the
extent that payment of such interest shall be legally enforceable, upon Overdue
Interest, at the Overdue Rate, and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection,
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including the reasonable compensation, expenses, disbursements and advances of
the Indenture Trustee, its agents and counsel.
Section 6.04. Remedies. If an Event of Default shall have occurred and be
continuing, the Indenture Trustee, in its own name and as trustee of an express
trust, may, with the consent of the Controlling Party, or shall, acting at the
direction of the Controlling Party, do one or more of the following:
(a) institute Proceedings for the collection of all
amounts then payable on the Notes, payable to the Class A Note Insurer
and otherwise payable under this Indenture, whether by declaration or
otherwise, prosecute such Proceeding to judgment or final decree, and
enforce the same against the Issuers and collect the monies adjudged or
decreed to be payable in the manner provided by law out of the property
of the Issuers, wherever situated;
(b) proceed to protect and enforce its rights and the
rights of the Holders, by such appropriate Proceedings as may be
consented to or directed by the Controlling Party, whether for the
specific enforcement of any covenant or agreement in this Indenture or
in aid of the exercise of any power Granted herein, or to enforce any
other proper remedy;
(c) sell the Collateral or any portion thereof or rights
or interest therein, at one or more Sales called and conducted in any
manner permitted by law;
(d) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect to the
Collateral;
(e) notify Lessees to make payments directly on such
account as shall be designated by the Controlling Party (the Indenture
Trustee to use Lessee contact information provided to it by the
Controlling Party);
(f) appoint by instrument in writing one or more
receivers, managers or receivers and managers of one or more of the
Issuers or any or all of the Collateral with such rights, powers and
authority (including any or all of the rights, powers and authority of
the Indenture Trustee under this Indenture) as may be provided for in
the instrument of appointment or any supplemental instrument, and
remove and replace any such Receiver from time to time. To the extent
permitted by applicable Law, any receiver, manager or receiver and
manager appointed by the Indenture Trustee will (for purposes relating
to responsibility for the receiver's, manager's or receiver and
manager's acts or omissions) be considered to be the agent of the
applicable Issuer and not of the Indenture Trustee, the Class A Note
Insurer or any of the Holders;
(g) apply to a court of competent jurisdiction for the
appointment of a receiver, a manager or a receiver and manager of one
or more of the Issuers or of any or all of the Collateral; and
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(h) exercise any remedies of a secured party under the
Uniform Commercial Code or other applicable Law and take any other
appropriate action to protect and enforce the rights and remedies of
the Indenture Trustee, the Class A Note Insurer or the Holders of the
Notes hereunder.
Section 6.05. Optional Preservation of Collateral. If (a) an Event of
Default shall have occurred and be continuing and (b) no Automatic Acceleration
has occurred, and no Notes have been declared due and payable or such
declaration and its consequences have been annulled and rescinded, the Indenture
Trustee, upon direction from the Controlling Party, by giving written notice of
such election to the Issuers, shall take possession of and retain the Collateral
intact, collect or cause the collection of the proceeds thereof and make and
apply all payments and deposits and maintain all accounts in respect of such
Notes in accordance with the provisions of Article XII of this Indenture. If the
Indenture Trustee is unable to or is stayed from giving such notice to the
Issuers for any reason whatsoever, such election shall be effective as of the
time of such determination or request, as the case may be, notwithstanding any
failure to give such notice, and the Indenture Trustee shall give such notice
upon the removal or cure of such inability or stay (but shall have no obligation
to effect such removal or cure). Any such election may be rescinded with respect
to any Collateral remaining at the time of such rescission by written notice to
the Indenture Trustee and the Issuers from the Controlling Party.
Section 6.06. Indenture Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
Proceeding relating to any Issuer or any other obligor upon any of the Notes or
the property of any Issuer or of such other obligor or their creditors, the
Indenture Trustee (irrespective of whether the principal of the Notes shall then
be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Indenture Trustee shall have made any demand on the
Issuers for the payment of Overdue Basic Principal Payments or Overdue Interest)
shall be entitled and empowered, to intervene, at the direction of the
Controlling Party, in such Proceeding or otherwise,
(a) to file and prove a claim for the whole amount of
principal and interest owing and unpaid in respect of the Notes issued
hereunder and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Indenture
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee, its agents and
counsel and any other amounts due the Indenture Trustee under Section
7.07), the Class A Note Insurer and of the Holders allowed in such
judicial Proceeding, and
(b) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, liquidator, or sequestrator (or other
similar official) in any such judicial Proceeding is hereby authorized by the
Class A Note Insurer and each Holder to make such payments to the Indenture
Trustee, and in the event that the Indenture Trustee shall consent to the making
of such payments directly to the Class A Note Insurer or the Holders, to pay to
the Indenture Trustee any amount due to it for the reasonable compensation,
expenses,
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disbursements and advances of the Indenture Trustee, its agents and counsel, and
any other amounts due the Indenture Trustee under Section 7.07.
Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or accept or adopt on behalf of the Class A
Note Insurer or any Holder any plan of reorganization, arrangement, adjustment
or composition affecting the Notes or the rights of the Class A Note Insurer or
any Holder thereof, or to authorize the Indenture Trustee to vote in respect of
the claim of the Class A Note Insurer or any Holder in any such Proceeding.
Section 6.07. Indenture Trustee May Enforce Claims Without Possession of
Notes. All rights of actions and claims under this Indenture or the Notes may be
prosecuted and enforced by the Indenture Trustee without the possession of any
of the Notes or the production thereof in any Proceeding relating thereto, and
any such Proceedings instituted by the Indenture Trustee shall be brought in its
own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee, its agents and counsel, be
for the ratable benefit of the Holders of the Notes and the Class A Note
Insurer.
Section 6.08. Application of Money Collected. (a) If the Notes have become
accelerated pursuant to Section 6.02, any money collected by the Indenture
Trustee pursuant to this Article VI, and all monies available in the Collection
Accounts shall be applied (after giving effect to the Source of Funds
Requirements and any transfers made pursuant to the Funds Transfer Agreement,
unless otherwise directed by the Controlling Party) in the following order on
each Payment Date (it being understood that if the Notes have not been
accelerated pursuant to Section 6.02, Available Funds shall be distributed
pursuant to Section 12.02(d)):
(i) to the Tax Payment Recipients, any Tax Payment
Amounts then due and owing by any Issuer;
(ii) to the Indenture Trustee, the Backup Manager and the
Backup Servicer, pari passu, all fees and expenses related to the
exercise of remedies under any Transaction Document (up to a maximum of
$150,000 or such higher amount as may be consented to by the
Controlling Party) and the Trustee Fee, the Backup Manager Fee and the
Backup Servicer Fee, respectively;
(iii) to the Lessees entitled thereto, any Railroad Mileage
Credits to which they are entitled under the Leases;
(iv) to the Class A Note Insurer and the Indenture
Trustee, pari passu, all out-of-pocket expenses incurred in connection
with the transition to a successor Manager; provided, however, that the
aggregate amount payable under this clause, together with any
corresponding payments paid in accordance with Section 12.02(d) with
respect to any one such transition shall not exceed $200,000;
(v) to the Manager, the Manager Fee;
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(vi) to the Manager for reimbursement for Operating
Expenses made by the Manager in excess of amounts available therefor
which are held in the Operating Expense Reserve Account; provided,
however, that the aggregate amount payable on any Payment Date pursuant
to this clause, together with any corresponding payments paid in
accordance with Section 12.02(d), shall not exceed the Capped Manager
Reimbursement;
(vii) to the Class A Note Insurer and the Indenture
Trustee, pari passu, all out-of-pocket expenses incurred in connection
with the transition to a successor Servicer; provided, however, that
the aggregate amount payable under this clause, together with any
corresponding payments paid in accordance with Section 12.02(d), with
respect to any one such transition shall not exceed $100,000;
(viii) to the Servicer, the Servicer Fee;
(ix) to the Indenture Trustee, for deposit in the
Operating Expense Reserve Account, the applicable Operating Expense
Deposit Amounts for the CARCAT OER Subaccount and the NARCAT OER
Subaccount, subject to the provisions of Section 12.04(a);
(x) to the Holders of the Class A Notes, pari passu, an
amount equal to the Class A Note Interest; provided, however, that,
notwithstanding the foregoing, the Class A Note Insurer shall be
entitled to receive, to the extent of Available Funds, all Incremental
Class A Interest and all Class A Overdue Interest to the extent of any
interest payments made by the Class A Note Insurer under, and in
compliance with, the Class A Note Policy and interest thereon accruing
at the Overdue Rate;
(xi) to the Class A Note Insurer, accrued Premium due with
respect to the Class A Note Policy, reimbursement of any claims under
the Class A Note Policy with respect to draws to pay Class A Note
Interest, including any Class A Overdue Interest owed with respect
thereto, any Incremental Class A Interest and, in an amount not to
exceed $50,000 in any calendar year, any other fees, expenses and
indemnities owing to the Class A Note Insurer, together in each case
with any interest thereon;
(xii) to the Indenture Trustee, for deposit to the NARCAT
Cash Collateral Account and the CARCAT Cash Collateral Amount, pari
passu, such amounts necessary to cause the amounts held therein to
equal the Required NARCAT Cash Collateral Amount and the Required
CARCAT Cash Collateral Amount, respectively;
(xiii) to the Holders of the Class A Notes, pari passu, any
remaining amounts until the Note Principal Balance of all Class A Notes
has been reduced to zero;
(xiv) to the extent not previously paid, to the Class A Note
Insurer, the amount of any unreimbursed claims paid by the Class A Note
Insurer under the Class A Note Policy with respect to principal on the
Class A Notes, and any fees, expenses and indemnities owing to the
Class A Note Insurer, together in each case with any interest owed
thereon;
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(xv) to the Holders of the Class B Notes, pari passu, an
amount equal to the accrued but unpaid Class B Note Interest;
(xvi) to the Holders of the Class B Notes, pari passu, any
remaining amounts until the Note Principal Balance of the Class B Notes
has been reduced to zero;
(xvii) to the Indenture Trustee, the Backup Manager, the
Backup Servicer and the Class A Note Insurer, pari passu, any fees,
expenses and indemnities owing thereto but not previously paid;
(xviii) to the Manager, any expenses, indemnities and
reimbursement payments owing thereto but not previously paid;
(xix) to the Servicer, any expenses, indemnities and
reimbursement payments owing thereto but not previously paid;
(xx) to the Manager, the Supplemental Manager Fee; and
(xxi) to the Issuers.
Notwithstanding any other provision of this Indenture, funds paid to
the Issuers pursuant to clause (xxi) above automatically shall be released from
the Lien of this Indenture.
In making the withdrawals and payments required by this Section 6.08,
the Indenture Trustee shall act in accordance with the Monthly Servicer Report
and shall be fully protected in relying thereon, unless (x) a Responsible
Officer has actual knowledge to the contrary or the Controlling Party has
notified the Indenture Trustee that a Servicer Event of Termination has occurred
and is continuing and has given instructions contrary to those contained in the
Monthly Servicer Report, or (y) no Monthly Servicing Report has been delivered
or the Controlling Party has instructed the Indenture Trustee that the Monthly
Servicer Report is incorrect, in which case the Indenture Trustee shall rely
upon the written instructions of the Controlling Party, and shall be fully
protected in relying thereon.
Section 6.09. Limitation on Suits. No Holder of any Note shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(a) such Holder has previously given written notice to
the Indenture Trustee and the Class A Note Insurer of a continuing
Event of Default;
(b) the Controlling Party shall have made written request
to the Indenture Trustee to institute Proceedings in respect of such
Event of Default in its own name as Indenture Trustee hereunder;
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(c) such Holder or Holders have offered to the Indenture
Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in compliance with such request;
(d) the Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity has failed to institute
any such Proceedings; and
(e) no direction inconsistent with such written request
has been given to the Indenture Trustee during such 60-day period by
the Controlling Party;
it being understood and intended that no one or more Holders of Notes shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
Holders of Notes, or to obtain or to seek to obtain priority or preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all the Holders
of Notes and it being further understood that nothing in this Section 6.09 shall
be deemed to permit any action prohibited by Section 15.13.
Section 6.10. Unconditional Right of Holders to Receive Principal and
Interest. Notwithstanding any other provision in this Indenture, but subject to
the priorities of payment provided for herein, the Holder of any Note shall have
the right, which is absolute and unconditional, to receive payment of the
principal and interest on such Note as such principal and interest become due
and payable and to institute suit for the enforcement of any such payment, and
such right shall not be impaired without the consent of such Holder.
Section 6.11. Restoration of Rights and Remedies. If the Indenture Trustee,
the Class A Note Insurer or any Holder has instituted any Proceeding to enforce
any right or remedy under this Indenture and such Proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Indenture Trustee, the Class A Note Insurer or to such Holder, then and in
every case the Issuers, the Class A Note Insurer, the Indenture Trustee and the
Holders shall, subject to any determination in such Proceeding, be restored
severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Indenture Trustee, the Class A Note Insurer and
the Holders shall continue as though no such Proceeding had been instituted.
Section 6.12. Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Indenture Trustee, the Class A Note Insurer or
to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 6.13. Delay or Omission Not Waiver. No delay or omission of the
Indenture Trustee, the Class A Note Insurer or of any Holder of any Note to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver
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of any such Event of Default or any acquiescence therein. Every right and remedy
given by this Article VI or by law to the Indenture Trustee, the Class A Note
Insurer or to the Holders may be exercised from time to time, and as often as
may be deemed expedient, by the Indenture Trustee, the Class A Note Insurer or
by the Holders, as the case may be.
Section 6.14. Control by Controlling Party. The Controlling Party shall
have the right to direct the time, method and place of conducting any Proceeding
for any remedy available to the Indenture Trustee with respect to the Notes or
exercising any trust or power conferred on the Indenture Trustee with respect to
the Notes; provided that with respect to the Notes:
(a) such direction shall not be in conflict with any rule
of law or with this Indenture, and
(b) the Indenture Trustee may take any other action
deemed proper by the Indenture Trustee which is not inconsistent with
such direction; provided, however, that, subject to Section 7.01, the
Indenture Trustee need not take any action which the Indenture Trustee
in good faith, by a Responsible Officer or Responsible Officers of the
Indenture Trustee, determines might involve it in liability or be
unjustly prejudicial to the Holders not consenting (unless the
Indenture Trustee is furnished with the reasonable indemnity referred
to in Section 6.14(c)); and
(c) the Indenture Trustee has been furnished reasonable
indemnity against costs, expenses and liabilities which it might incur
in connection therewith as provided in Section 7.01(f).
Section 6.15. Waiver of Past Defaults. The Controlling Party, by written
notice to the Issuers and the Indenture Trustee, may, on behalf of the Class A
Note Insurer and all Holders, waive any past Default or Event of Default
hereunder and its consequences, except a Default or Event of Default:
(a) (I) in (i) the payment of the principal of any Note
at the Stated Legal Maturity Date or (ii) the payment of interest with
respect to the Class A Notes when due, unless, in either case, such
amounts have been paid by the Class A Note Insurer (in which case, the
Controlling Party may waive such Default an Event of Default); or (II)
if no Class A Notes are Outstanding, a payment default on the Class B
Notes; or
(b) in respect of a covenant or provision hereof which
under Article IX cannot be modified or amended without the consent of
the Holder of each Outstanding Note affected.
Upon any such waiver, such Default or Event of Default (and any Event
of Default arising from any such Default) shall cease to exist and shall be
deemed to have been cured for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or Event of Default or
impair any right consequent thereon.
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Section 6.16. Undertaking for Costs. All parties to this Indenture agree,
and each Holder of any Note by its acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 6.16 shall not apply to any suit instituted by the
Indenture Trustee or the Class A Note Insurer, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the Outstanding Notes, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of, or premium, if any, or interest
on any Note on or after the Stated Legal Maturity Date expressed in such Note.
Section 6.17. Waiver of Stay or Extension Laws. Each of the Issuers
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and each Issuer (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any power herein
Granted to the Indenture Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
Section 6.18. Sale of Collateral. (a) The power to effect any sale (a
"Sale") of any Collateral pursuant to Section 6.04 shall not be exhausted by any
one or more Sales as to any Collateral remaining unsold, but shall continue
unimpaired until all of the Collateral shall have been sold or all amounts
payable on the Notes and under this Indenture with respect thereto shall have
been paid. The Indenture Trustee may from time to time postpone any Sale by
public announcement made at the time and place of such Sale. It is hereby
expressly agreed that the Indenture Trustee is not limited to any amount fixed
by law as compensation for any Sale.
(b) The Indenture Trustee or the Class A Note Insurer may bid for
and acquire any Collateral in connection with a public Sale thereof, and in lieu
of paying cash therefor, may make settlement for the purchase price by crediting
against amounts owing on the Notes or other amounts secured by this Indenture,
all or part of the net proceeds of such Sale after deducting the reasonable
costs, charges and expenses incurred by the Indenture Trustee in connection with
such Sale. The purchase by the Indenture Trustee or the Class A Note Insurer of
any or all of the Collateral shall not be deemed a Sale or disposition thereof
for purposes of Section 6.18(a). The Notes need not be produced in order to
complete any such Sale, or in order for the net proceeds of such Sale to be
credited against the Notes. The Indenture Trustee and the Class A Note Insurer
may hold, lease, operate, manage or otherwise deal with any property so acquired
in any manner permitted by law.
(c) The Indenture Trustee shall execute and deliver an appropriate
instrument of conveyance transferring its interest in any of the Collateral in
connection with a Sale thereof. In addition, the Indenture Trustee is hereby
irrevocably appointed the agent and attorney-in-fact of
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the Issuers to transfer and convey its interest in any of the Collateral in
connection with a Sale thereof, and to take all action necessary to effect such
Sale. Such power of attorney shall be deemed coupled with an interest and be
irrevocable. No purchaser or transferee at such a sale shall be bound to
ascertain the Indenture Trustee's authority, inquire into the satisfaction of
any conditions precedent or see to the application of any monies.
Section 6.19. Action on Notes. The Indenture Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the Lien of this Indenture nor any rights or remedies
of the Indenture Trustee, the Class A Note Insurer or the Holders shall be
impaired by the recovery of any judgment by the Indenture Trustee against any
Issuer or by the levy of any execution under such judgment upon any of the
Collateral or upon any of the assets of any Issuer.
ARTICLE VII
THE INDENTURE TRUSTEE
Section 7.01. Certain Duties and Responsibilities. (a) Except during the
continuance of an Event of Default known to the Indenture Trustee as provided in
subsection (e) below:
(i) The Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read into
this Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the
Indenture Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Indenture Trustee and
conforming to the requirements of this Indenture.
(b) If an Event of Default known to the Indenture Trustee as
provided in subsection (e) below has occurred and is continuing, the Indenture
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
(c) No provision of this Indenture shall be construed to relieve
the Indenture Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) this subsection (c) shall not be construed to limit
the effect of subsection (a) of this Section 7.01;
(ii) the Indenture Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer, unless
it shall be proved that the Indenture Trustee was negligent in
ascertaining the pertinent facts;
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(iii) the Indenture Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith
in accordance with the direction of the Controlling Party relating to
the time, method and place of conducting any Proceeding for any remedy
available to the Indenture Trustee, or exercising any trust or power
conferred upon the Indenture Trustee under this Indenture; and
(iv) no provision of this Indenture shall require the
Indenture Trustee to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision
of this Indenture relating to the conduct or affecting the liability of or
affording protection to the Indenture Trustee shall be subject to the provisions
of this Section 7.01.
(e) For all purposes under this Indenture, the Indenture Trustee
shall not be deemed to have notice of any Event of Default described in Section
6.01(d) or 6.01(e), any Default described in Section 6.01(c), any Servicer
Termination Event, any Manager Termination Event or any Rapid Amortization Event
unless a Responsible Officer assigned to and working in the Indenture Trustee's
corporate trust department has actual knowledge thereof or unless written notice
of any such event is received by the Indenture Trustee at the Corporate Trust
Office, and such notice references the Notes, the Issuers, the Collateral or
this Indenture.
(f) The Indenture Trustee shall be under no obligation to
institute any suit, or to take any remedial Proceeding under this Indenture, or
to enter any appearance or in any way defend in any suit in which it may be made
defendant, or to take any steps in the execution of the trusts hereby created or
in the enforcement of any rights and powers hereunder until it shall be
indemnified to its satisfaction against any and all costs and expenses, outlays
and counsel fees and other reasonable disbursements and against all liability,
except liability that is adjudicated, in connection with any action so taken.
(g) Notwithstanding any extinguishment of all right, title and
interest of the Issuers in and to the Collateral following an Event of Default
and a consequent declaration of acceleration of the maturity of the Notes,
whether such extinguishment occurs through a Sale of the Collateral to another
Person, the acquisition of the Collateral by the Indenture Trustee with respect
to the Collateral (or the proceeds thereof), and the rights of the Holders shall
continue to be governed by the terms of this Indenture.
(h) Notwithstanding anything to the contrary contained herein, the
provisions of subsections (e) through (g), inclusive, of this Section 7.01 shall
be subject to the provisions of subsections (a) through (c), inclusive, of this
Section 7.01.
Section 7.02. Notice of Defaults, Events of Default, Servicer Termination
Events, Manager Events of Termination and Rapid Amortization Events. Within two
Business Days after the occurrence of any Default, Event of Default, Servicer
Termination Event, Manager
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Event of Termination or Rapid Amortization Event known to the Indenture Trustee,
the Indenture Trustee shall transmit by facsimile communication confirmed by
mail to the Class A Note Insurer and by mail to all Holders of Notes, as their
names and addresses appear on the Note Register, notice of such Default, Event
of Default, Servicer Termination Event, Manager Event of Termination or Rapid
Amortization Event known to the Indenture Trustee, unless such Default, Event of
Default, Servicer Termination Event, Manager Event of Termination or Rapid
Amortization Event shall have been cured or waived.
Section 7.03. Certain Rights of Indenture Trustee. Except as otherwise
provided in Section 7.01,
(a) the Indenture Trustee may rely and shall be protected
in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, note or other obligation, paper or document
believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request or direction of the Issuers mentioned
herein shall be sufficiently evidenced by an Issuer Request or Issuer
Order, and any resolution of any Board of Directors may be sufficiently
evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the
Indenture Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action
hereunder, the Indenture Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officer's Certificate;
(d) the Indenture Trustee may consult with counsel and
the written advice of such counsel or any Opinion of Counsel shall be
full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;
(e) the Indenture Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Indenture at
the request or direction of the Class A Note Insurer or any of the
Holders pursuant to this Indenture, unless the Class A Note Insurer or
such Holders shall have offered to the Indenture Trustee reasonable
security or indemnity against the costs, expenses and liabilities which
might be incurred by it in compliance with such request or direction;
(f) the Indenture Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, note or other paper or document, but
the Indenture Trustee, at the direction of the Controlling Party, shall
make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Indenture Trustee shall determine to
make such further inquiry or investigation, it shall be
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entitled to examine the books, records and premises of each Issuer,
upon reasonable notice and at reasonable times personally or by agent
or attorney; and
(g) the Indenture Trustee may execute any of the trusts
or powers hereunder or perform any duties hereunder either directly or
by or through agents or attorneys and the Indenture Trustee shall not
be responsible for any misconduct or negligence on the part of any
agent or attorney appointed with due care by it hereunder.
Section 7.04. Not Responsible for Recitals or Issuance of Notes. (a) The
recitals contained herein and in the Notes, except the certificates of
authentication on the Notes, shall be taken as the statements of the Issuers,
and the Indenture Trustee assumes no responsibility for their correctness. The
Indenture Trustee makes no representations as to the validity or condition of
the Collateral or any part thereof, or as to the title of the Issuers thereto or
as to the security afforded thereby or hereby, or as to the validity or
genuineness of any securities at any time pledged and deposited with the
Indenture Trustee hereunder or as to the validity or sufficiency of this
Indenture or of the Notes. The Indenture Trustee shall not be accountable for
the use or application by any Issuer of Notes or the proceeds thereof or of any
money paid to any Issuer under any provisions hereof.
(b) Except as otherwise expressly provided herein and without
limiting the generality of the foregoing, the Indenture Trustee shall have no
responsibility or liability for or with respect to the existence or validity of
any Railcar or Lease, the perfection of any security interest (whether as of the
date hereof or at any future time), the maintenance of or the taking of any
action to maintain such perfection, the validity of the assignment of any
portion of the Collateral to the Indenture Trustee or of any intervening
assignment, the review of any Lease (it being understood that the Indenture
Trustee has not reviewed and does not intend to review the substance or form of
any such Lease) the performance or enforcement of any Lease, the compliance by
the Issuers, the Sellers, the Manager or the Servicer with any covenant or the
breach by the Issuers, the Sellers, the Manager or the Servicer of any warranty
or representation made hereunder or in any related document or the accuracy of
any such warranty or representation, any investment of monies in the Collection
Accounts, the Cash Collateral Accounts, the Operating Expense Reserve Account
(including the NARCAT OER Subaccount and the CARCAT OER Subaccount) or the
Prefunding or any loss resulting therefrom, the acts or omissions of the
Issuers, the Class A Note Insurer, the Sellers, the Manager, the Servicer, or
any Lessee, any action of the Servicer, the Manager or the Sellers taken in the
name of the Indenture Trustee, or the validity of the Servicing Agreement, the
Management Agreement or the Sale Agreements.
(c) The Indenture Trustee shall not have any obligation or
liability under any Lease by reason of or arising out of this Indenture or the
Granting of a security interest in such Lease hereunder or the receipt by the
Indenture Trustee of any payment relating to any Lease pursuant hereto, nor
shall the Indenture Trustee be required or obligated in any manner to perform or
fulfill any of the obligations of the Issuers under or pursuant to any Lease, or
to make any payment, or to make any inquiry as to the nature or the sufficiency
of any payment received by it, or the sufficiency of any performance by any
party, under any Lease.
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Section 7.05. May Hold Notes. The Indenture Trustee, the Servicer, the
Manager, any Paying Agent, the Note Registrar or any other agent of the Issuers,
in its individual or any other capacity, may become the owner or pledgee of
Notes and if operative, may otherwise deal with the Issuers with the same rights
it would have if it were not Indenture Trustee, Servicer, Manager, Paying Agent,
Note Registrar or such other agent.
Section 7.06. Money Held in Trust. Money held in trust by the Indenture
Trustee or any Paying Agent hereunder need not be segregated from other funds
except to the extent required herein or required by law. The Indenture Trustee
or any Paying Agent shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed with the Issuers or provided
herein.
Section 7.07. Compensation and Reimbursement. The Issuers agree, jointly
and severally, to make payment to the Indenture Trustee of the following
(provided that any amounts payable below shall be paid only pursuant to Section
12.02(d) or Section 6.08 or from other funds available to the Issuers that are
not subject to the Lien of the Indenture):
(a) the Trustee Fee (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an
express trust);
(b) except as otherwise expressly provided herein, such
amount as may be necessary to reimburse the Indenture Trustee upon its
request for all extraordinary out-of-pocket expenses (including,
without limitation, any out-of-pocket expenses incurred in connection
with providing copies of the Transaction Documents and other documents
to the Secured Parties and other interested parties), disbursements and
advances incurred or made by the Indenture Trustee in accordance with
any provision of this Indenture (including the reasonable compensation
and the expenses and disbursements of the Indenture Trustee's agents
and counsel), except any such expense, disbursement or advance as may
be attributable to its negligence or bad faith; and
(c) such amount as may be necessary to indemnify the
Indenture Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or
administration of this trust, including the costs and expenses of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
Section 7.08. Corporate Indenture Trustee Required; Eligibility. There
shall at all times be a Indenture Trustee hereunder which shall be a national
banking association organized and doing business under the laws of the United
States of America or of any state, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$100,000,000, subject to supervision or examination by federal or state
authority, satisfactory to the Controlling Party and having an office within the
United States of America. If such national banking association publishes reports
of condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section 7.08, the combined capital and surplus of such national banking
association shall be
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deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Indenture Trustee shall
cease to be eligible in accordance with the provisions of this Section 7.08, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article VII.
Section 7.09. Resignation and Removal; Appointment of Successor. (a) No
resignation or removal of the Indenture Trustee and no appointment of a
successor Indenture Trustee pursuant to this Article VII shall become effective
until the acceptance of appointment by the successor Indenture Trustee under
Section 7.10.
(b) The Indenture Trustee may resign at any time by giving 30
days' prior written notice thereof to the Issuers, the Class A Note Insurer and
each Holder. If an instrument of acceptance by a successor Indenture Trustee
shall not have been delivered to the Indenture Trustee within 30 days after the
giving of such notice of resignation, the resigning Indenture Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Indenture Trustee. Such court may thereupon, after such notice, if any, as it
may deem proper, appoint a successor Indenture Trustee.
(c) The Indenture Trustee may be removed at any time by the
Controlling Party by notice delivered to the Indenture Trustee and to the
Issuers.
(d) If the Indenture Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of the Indenture
Trustee for any reason, the Controlling Party shall promptly appoint a successor
Indenture Trustee. Such successor Indenture Trustee so appointed shall,
forthwith upon its acceptance of such appointment, become the successor
Indenture Trustee and supersede the successor Indenture Trustee appointed by the
Controlling Party. If no successor Indenture Trustee shall have been so
appointed by the Controlling Party within one year after such resignation,
removal or incapability or the occurrence of such vacancy, and shall have
accepted appointment in the manner hereinafter provided, any Holder who has been
a Registered Holder of a Note for at least six months may, on behalf of himself
and all others similarly situated, petition any court of competent jurisdiction
for the appointment of a successor Trustee.
(e) The Issuers shall give notice to each of the Holders in the
manner provided in Section 15.04 of each resignation and each removal of the
Indenture Trustee and each appointment of a successor Indenture Trustee. Each
notice shall include the name of the successor Indenture Trustee and the address
of its Corporate Trust Office.
Section 7.10. Acceptance of Appointment by Successor. Every successor
Indenture Trustee appointed hereunder shall execute, acknowledge and deliver to
the Issuers, the Class A Note Insurer and the retiring Indenture Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Indenture Trustee shall become effective and such successor
Indenture Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Indenture
Trustee; but, on request of the Issuers or the successor Indenture Trustee, such
retiring Indenture Trustee shall, upon payment of its reasonable charges,
execute and deliver an instrument transferring to such
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successor Indenture Trustee all the rights, powers and trusts of the retiring
Indenture Trustee, and shall duly assign, transfer and deliver to such successor
Indenture Trustee all property and money held by such retiring Indenture Trustee
hereunder. Upon request of any such successor Indenture Trustee, the Issuers
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Indenture Trustee all such rights, powers and
trusts.
No successor Indenture Trustee shall accept its appointment unless at
the time of such acceptance such successor Indenture Trustee shall be eligible
under this Article VII.
Section 7.11. Merger, Conversion, Consolidation or Succession to Business
of Indenture Trustee. Any entity into which the Indenture Trustee may be merged
or converted or with which it may be consolidated, or any entity resulting from
any merger, conversion or consolidation to which the Indenture Trustee shall be
a party, or any entity succeeding to all or substantially all of the corporate
trust business of the Indenture Trustee, shall be the successor of the Indenture
Trustee hereunder; provided such entity shall be otherwise qualified and
eligible under this Article VII, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, and notice thereof
shall be provided by the Indenture Trustee to the Holders and the Class A Note
Insurer. In case any Notes have been authenticated, but not delivered, by the
Indenture Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Indenture Trustee may adopt such
authentication and deliver the Notes so authenticated with the same effect as if
such successor Indenture Trustee had itself authenticated such Notes.
Section 7.12. Co-trustees and Separate Trustees. At any time or times, for
the purpose of meeting the legal requirements of any jurisdiction in which any
of the Collateral may at the time be located, the Issuers and the Indenture
Trustee shall have power to appoint, and, upon the written request of the
Indenture Trustee or of the Controlling Party, the Issuers shall for such
purpose join with the Indenture Trustee in the execution, delivery and
performance of all instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Indenture Trustee, either to act as
co-trustee, jointly with the Indenture Trustee of any or all of the Collateral,
or to act as separate trustee of any such property, in either case with such
powers as may be provided in the instrument of appointment, and to vest in such
Person or Persons in the capacity aforesaid, any property, title, right or power
deemed necessary or desirable, subject to the other provisions of this Section
7.12. If the Issuers do not join in such appointment within 30 days after the
receipt by it of a request so to do, or in case an Event of Default has occurred
and is continuing, the Indenture Trustee alone shall have power to make such
appointment.
Should any written instrument from the Issuers be reasonably required
by any co-trustee or separate trustee so appointed for more fully confirming to
such co-trustee or separate trustee such property, title, right or power, any
and all such instruments shall, on request, be executed, acknowledged and
delivered by the Issuers.
Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms:
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(i) The Notes shall be authenticated and delivered by,
and all rights, powers, duties and obligations hereunder in respect of
the custody of securities, cash and other personal property held by, or
required to be deposited or pledged with, the Indenture Trustee
hereunder, shall be exercised solely by the Indenture Trustee;
(ii) The rights, powers, duties and obligations hereby
conferred or imposed upon the Indenture Trustee in respect of any
property covered by such appointment shall be conferred or imposed upon
and exercised or performed by the Indenture Trustee or by the Indenture
Trustee and such co-trustee or separate trustee jointly, as shall be
provided in the instrument appointing such co-trustee or separate
trustee, except to the extent that under any law of any jurisdiction in
which any particular act is to be performed, the Indenture Trustee
shall be incompetent or unqualified to perform such act, in which event
such rights, powers, duties and obligations shall be exercised and
performed by such co-trustee or separate trustee;
(iii) The Indenture Trustee at any time, by an instrument
in writing executed by it, with the concurrence of the Issuers
evidenced by a Board Resolution with respect to each Issuer, may accept
the resignation of or remove any co-trustee or separate trustee,
appointed under this Section 7.12, and, in case an Event of Default has
occurred and is continuing, the Indenture Trustee shall have power to
accept the resignation of, or remove, any such co-trustee or separate
trustee without the concurrence of the Issuers. Upon the written
request of the Indenture Trustee, the Issuers shall join with the
Indenture Trustee in the execution, delivery and performance of all
instruments and agreements necessary or proper to effectuate such
resignation or removal. A successor to any co-trustee or separate
trustee that has so resigned or been removed may be appointed in the
manner provided in this Section 7.12;
(iv) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Indenture
Trustee or any other such trustee hereunder nor shall the Indenture
Trustee be liable by reason of any act or omission of any co-trustee or
separate trustee selected by the Indenture Trustee with due care or
appointed in accordance with directions to the Indenture Trustee
pursuant to Section 6.14; and
(v) Any Act of Holders delivered to the Indenture Trustee
shall be deemed to have been delivered to each such co-trustee and
separate trustee.
Section 7.13. Indenture Trustee to Hold Original Leases; Indenture Trustee
Check-In Procedures. (a) The Indenture Trustee shall hold each original
counterpart of a Lease that may from time to time be delivered to the Indenture
Trustee in accordance with this Indenture, the Servicing Agreement or the
Management Agreement, until such time as such Lease is released from the Lien of
this Indenture pursuant to the terms of this Indenture.
(b) Prior to the Closing Date, the Indenture Trustee checked in
the Initial Existing Leases pursuant to the procedures set forth in the Bailee
Letter. The Indenture Trustee shall perform a check-in of all (i) Prefunded
Existing Leases, by the fifth Business Day after the receipt of such Prefunded
Existing Leases and the Prefunded Lease and Railcar Schedule (and an
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electronic copy of such Prefunded Lease and Railcar Schedule), and (ii)
Subsequent Leases, by the fifth Business Day after the receipt of such
Subsequent Leases and an updated Lease and Railcar Schedule (and an electronic
copy of such Lease and Railcar Schedule). Upon the completion of each check-in,
the Indenture Trustee shall deliver via facsimile to the Servicer, the Manager,
the Issuers, the Class A Note Insurer and the Holders a certification in
substantially the form attached hereto as Exhibit C to the effect that (except
for original counterparts of Leases identified on Schedule IV hereto or as
described on the deficiency report attached thereto (the "Lease Exception
Report")) (i) the Indenture Trustee has received the original counterparts for
each Lease listed on the related Lease and Railcar Schedule or Prefunded Lease
and Railcar Schedule, as applicable, and it is holding such Leases as Indenture
Trustee for the benefit of the Holders, (ii) such documents have been reviewed
by it and do not appear on their face to have been mutilated, damaged, torn or
otherwise physically altered and relate to such Lease identified in the Lease
and Railcar Schedule or Prefunded Lease and Railcar Schedule, as applicable, and
(iii) the Indenture Trustee does not hold an original copy of any Lease for or
on behalf of any Person other than the Secured Parties.
(c) The Issuers shall cause the Manager to resolve any such
exceptions noted in the Lease Exception Report to the Controlling Party's
satisfaction, and no Lease for which exceptions remain shall be an Eligible
Lease unless the Controlling Party has otherwise provided its written consent;
provided that the Controlling Party's consent to any such exception shall not
release the Manager from its purchase obligations under Section 4.04 of the
Management Agreement arising as a result of a breach of a representation or
warranty with respect to such Lease not covered by such written consent. The
Indenture Trustee shall be under no duty or obligation to inspect, review or
examine the Leases to determine that the same are genuine, enforceable or
appropriate for the represented purpose or that they have actually been recorded
or that they are other than what they purport to be on their face.
(d) The Indenture Trustee shall hold the originally executed copy
of each Lease that constitutes chattel paper for the purposes of the UCC until
such time as such Lease is released from the Lien of this Indenture or delivered
to the Servicer pursuant to the terms hereof or of the Servicing Agreement. The
Indenture Trustee shall hold the Leases in the same state as the location of the
Corporate Trust Office, which initially is in Minneapolis, Minnesota.
(e) The Indenture Trustee, in its capacity as custodian of the
original counterparts of the Leases, shall, upon reasonable notice, permit the
Class A Note Insurer and the Holders access to the Leases at all reasonable
times, upon reasonable notice and during the Trustee's normal business hours.
Such access shall be afforded without charge to the Class A Note Insurer and the
Holders but only upon reasonable request.
(f) The Indenture Trustee hereby agrees to hold the originally
executed copy of each Lease and the other items of Collateral it receives on
behalf of the Secured Parties, and to maintain exclusive custody of any such
Collateral from time to time pledged to the Indenture Trustee, on behalf of the
Secured Parties. In performing its duties hereunder, the Indenture Trustee
agrees to act with reasonable care, using that degree of skill and attention
that a custodian would exercise with respect to files relating to all comparable
collateral that it services or holds for others.
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(g) The Indenture Trustee shall segregate and maintain continuous
custody of all Leases, chattel paper, documents and instruments in secure and
fire resistant facilities in accordance with customary standards for such
custody.
(h) The Indenture Trustee shall (i) act exclusively as the
custodian for, and the bailee of, the Secured Parties, (ii) hold each Lease,
chattel paper, document and instrument received by it for the exclusive use and
benefit of the Secured Parties, and (iii) make disposition thereof only in
accordance with the terms of this Indenture or with written instructions
furnished by the Controlling Party.
Section 7.14. Money for Note Payments to Be Held in Trust. The Indenture
Trustee agrees, subject to the provisions of this Section 7.14, that it will
hold all sums held by it for the payment of principal or interest on the Notes
in trust for the benefit of the Holders entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein provided.
Any money deposited with the Indenture Trustee in trust for the payment
of the principal or interest on any Note and remaining unclaimed for three years
after such principal or interest has become due and payable shall be paid to or
at the direction of the Issuers; and the Holder of such Note shall thereafter,
as an unsecured general creditor, and subject to any applicable statute of
limitations, look only to the Issuers for payment thereof, and all liability of
the Indenture Trustee with respect to such trust money or the related Note shall
thereupon cease; provided, however, that the Indenture Trustee, before being
required to make any such repayment, may at the expense of the Issuers cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the city in which
the Corporate Trust Office is located, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication, any unclaimed balance of such money then
remaining will be repaid to, or at the direction of, the Issuers. The Indenture
Trustee may also adopt and employ, at the expense of the Issuers, any other
reasonable means of notification of such repayment (including, but not limited
to, mailing notice of such repayment to Holders whose right to or interest in
monies due and payable but not claimed is determinable from the records of the
Indenture Trustee at the last address as shown on the Note Register for each
such Holder).
Section 7.15. Representations and Warranties of Indenture Trustee. The
Indenture Trustee hereby represents and warrants that:
(a) the Indenture Trustee is a national banking
association duly organized, validly existing and in good standing under
the laws of the United States, and has the power to own its assets and
to transact the business in which it is presently engaged;
(b) the Indenture Trustee has the power, authority and
legal right to execute, deliver and perform this Indenture and to
authenticate the Notes, and the execution, delivery and performance of
this Indenture and the authentication of the Notes has been duly
authorized by the Indenture Trustee by all necessary corporate action;
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(c) this Indenture, assuming due authorization, execution
and delivery by the other parties hereto, constitutes the legal, valid
and binding agreement of the Indenture Trustee, enforceable against the
Indenture Trustee in accordance with its terms, except that (i) such
enforcement may be subject to bankruptcy, insolvency, reorganization,
moratorium or other similar laws (whether statutory, regulatory or
decisional) now or hereafter in effect relating to creditors' rights
generally and the rights of trust companies in particular and (ii) the
remedy of specific performance and injunctive and other forms of
equitable relief may be subject to certain equitable defenses and to
the discretion of the court before which any proceeding therefor may be
brought, whether in a proceeding at law or in equity;
(d) the performance by the Indenture Trustee of its
obligations under this Indenture will not conflict with, result in any
breach of any of the terms and provisions of, or constitute (with or
without notice, lapse of time or both) a default under, the
organizational documents or bylaws of the Indenture Trustee;
(e) to the best of the knowledge of the Indenture
Trustee, there are no proceedings or investigations to which the
Indenture Trustee is a party pending, or, to the knowledge of the
Indenture Trustee, threatened, before any court, regulatory body,
administrative agency or other tribunal or Governmental Authority (i)
asserting the invalidity of this Indenture, the Notes or any other
Transaction Document, (ii) seeking to prevent the issuance of the Notes
or the consummation of any of the transactions contemplated by this
Indenture or any other Transaction Document or (iii) seeking any
determination or ruling that would materially and adversely affect the
performance by the Indenture Trustee of its obligations under, or the
validity or enforceability of, this Indenture, the Notes or any other
Transaction Document; and
(f) neither the execution or delivery by the Indenture
Trustee of this Indenture or any other Transaction Document nor the
consummation by the Indenture Trustee of the transactions contemplated
hereby or by any other Transaction Document requires the consent or
approval of, the giving of notice to, the registration with, or the
taking of any other action with respect to, any Governmental Authority
under any existing federal law governing the banking or trust powers of
the Indenture Trustee.
Section 7.16. Reporting by Indenture Trustee. To the extent that the
Transaction Documents do not expressly require that items be delivered directly
to the Class A Note Insurer by a party other than the Indenture Trustee, the
Indenture Trustee shall promptly furnish to the Class A Note Insurer a copy of
all reports, financial statements and notices received or prepared by the
Indenture Trustee pursuant to the terms of this Indenture and the other
Transaction Documents.
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ARTICLE VIII
PURCHASES AND RELEASES
Section 8.01. Purchase of Railcars and Leases. (a) If at any time any
Issuer or the Indenture Trustee discovers or is notified by the Manager that any
representation or warranty of the Initial Manager contained in Section 4.03 of
the Management Agreement was incorrect at the time as of which such
representation or warranty was made, then the party discovering such
circumstance shall promptly notify the other parties hereto and the Class A Note
Insurer.
(b) In the event that the failure of any representation or
warranty of the Initial Manager contained in Section 4.03 of the Management
Agreement (other than the representation and warranty set forth in Section
4.03(pp) thereof)) to be correct at the time as of which it was made materially
and adversely affects the interests of the Holders of the Notes in any Railcar
or Lease which is the subject of such representation or warranty, then the
Issuers shall require the Initial Manager to eliminate or cure such circumstance
or condition within the time period set forth in Section 4.04 of the Management
Agreement. If the Initial Manager fails or is unable to cure such circumstance
or condition in accordance with the Management Agreement, then the Issuers shall
require the Initial Manager to take such steps as are necessary to (i) if a
Lease is the subject of such representation or warranty, Purchase all of the
Railcars covered by such Lease (and the related Lease and other Railcar Assets
relating solely to such Railcars) at the Purchase Price in accordance with
Section 4.04 of the Management Agreement, or (ii) if a Railcar is the subject of
such representation or warranty, either (A) Purchase such Railcar at the
Purchase Price in accordance with Section 4.04 of the Management Agreement or
(B) provide a Substitute Railcar meeting all of the requirements of Section 4.03
of the Management Agreement, complying with the Concentration Limits and having
a Stated Value which, when aggregated with the Stated Values of all other
Substitute Railcars then being provided, shall be no less than the aggregate
Stated Value of all Railcars then being replaced, so that the representations
and warranties with respect to such Railcar or Lease, as applicable, are
correct. In the event of any breach of the representation or warranty set forth
in Section 4.03(pp) of the Management Agreement, the Issuers shall require the
Initial Manager to Purchase or provide Substitute Railcars to the extent
required to cure such breach. Upon such Purchase or substitution, the Indenture
Trustee shall release the Railcar so purchased or replaced (and any related
Lease and other Railcar Assets relating solely to such Railcar) from the Lien of
this Indenture pursuant to Section 8.02.
(c) In the event that the initial Servicer shall be obligated to
Purchase any Railcar (and any related Lease and other Railcar Assets) pursuant
to Section 4.03(b) of the Servicing Agreement, then the Issuers shall require
the initial Servicer to effect such Purchase in the manner, within the time and
for the Purchase Price specified in Section 4.03(b) of the Servicing Agreement.
Upon such Purchase, the Indenture Trustee shall release the Railcar in question
(and any related Lease and other Railcar Assets relating solely to such Railcar)
from the Lien of this Indenture pursuant to Section 8.02.
(d) In the event that the Initial Manager fails to Purchase or
substitute, or the initial Servicer fails to Purchase, any Railcar (and any
related Lease and other Railcar Assets) by the time required in Section 4.04(b)
of the Management Agreement or Section 4.03(b) of the
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Servicing Agreement, respectively, the Indenture Trustee, provided it has
received notice in accordance with Section 4.04(a) of the Management Agreement
or Section 4.03 of the Servicing Agreement, respectively, shall promptly notify
the Class A Note Insurer of such failure.
Section 8.02. Releases. (a) The Issuers shall be entitled to sell and
obtain a release from the Lien of this Indenture (i) any Railcar with respect to
which an Event of Loss shall have occurred, (ii) any Scrapped Railcar, (iii) any
Railcar having a net sales price in excess of its Stated Value, if to do so
would be, in the Manager's good faith determination, in the best interests of
the relevant Issuer, and (iv) any Railcar required to be purchased or
substituted for by the Manager in accordance with Section 4.04 of the Management
Agreement or purchased by the Servicer in accordance with Section 4.03 of the
Servicing Agreement; provided, however, that (A) except in the case of (x)
Railcars sold subsequent to the occurrence of an Event of Loss with respect
thereto, (y) Scrapped Railcars and (z) Railcars so purchased or substituted by
the Manager or the Servicer, the aggregate Stated Value of the Railcars sold in
such sales cannot exceed more than 10% of the sum of (I) the aggregate Stated
Values of all Initial Railcars as of the Closing Date and (II) the aggregate
Stated Value of all Prefunded Railcars purchased on the Prefunded Railcar
Acquisition Date, and (B) in making the good faith determination referenced
above, any successor to the Initial Manager shall be entitled to base such
determination upon appraisals furnished by Independent Appraisers. Any such sale
(other than a sale resulting from an event described in clause (i) or (iv),
above) shall be made only to entities which are not Affiliates of The Andersons
and only if the release of such Railcar will not result in, or exacerbate, a
breach of a Concentration Limit. Any proceeds of such sale shall be deposited
into the relevant Collection Account and thereafter the relevant Issuer shall be
entitled to obtain a release from the Lien of the Indenture of any sold Railcar
(and any related Lease and other Railcar Assets related solely to such Railcar)
if such Issuer delivers to the Indenture Trustee and the Class A Note Insurer an
Officer's Certificate (x) identifying the Railcars (and any related Lease and
other Railcar Assets) to be released, (y) certifying that the conditions
precedent to such release contained in the Transaction Documents had been
complied with and (z) requesting the release thereof.
(b) The Indenture Trustee shall, on or after the Termination Date,
release any remaining portion of the Trust Estate from the Lien created by this
Indenture and shall distribute any funds then on deposit in any account in
accordance with the provisions of this Indenture.
(c) The Indenture Trustee and the Class A Note Insurer shall be
entitled to receive at least 10 days' notice of any action to be taken pursuant
to clauses (iii) or (iv) of Section 8.02(a), accompanied by copies of any
instruments involved.
(d) Upon satisfaction of the conditions specified in subsection
(a) or (b), the Indenture Trustee shall release from the Lien of this Indenture
and deliver to or upon the order of the Issuers the Railcars, the related Lease
(if any) and the Railcar Assets relating solely to such Railcars and to the
extent described in the Issuers' request for release.
Section 8.03. Collateral. The Indenture Trustee may, and when required
by the provisions of Articles VI and VIII of this Indenture shall, execute or
authorize, as appropriate, instruments to release property from the Lien of this
Indenture, or convey the Indenture Trustee's
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interest in the same, in a manner and under circumstances which are not
inconsistent with the provisions of this Indenture. No party relying upon an
instrument executed by the Indenture Trustee as provided in this Article VIII
shall be bound to ascertain the Indenture Trustee's authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
monies.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures without Consent of Holders. (a)
Without the consent of the Holders of any Notes, the Issuers and the Indenture
Trustee, at any time and from time to time, but with the consent of the Class A
Note Insurer (so long as no Class A Note Insurer Default shall have occurred and
be continuing), may enter into one or more indentures supplemental hereto, in
form satisfactory to the Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property
at any time subject to the Lien of this Indenture, or better to assure,
convey and confirm unto the Indenture Trustee any property subject or
required to be subjected to the Lien of this Indenture, or to subject
to the Lien of this Indenture additional property;
(ii) to add to the conditions, limitations and
restrictions on the authorized amount, terms and purposes of issue,
authentication and delivery of any Notes, as herein set forth,
additional conditions, limitations and restrictions thereafter to be
observed, for the benefit of the Holders;
(iii) to evidence the succession of another Person to any
Issuer, and the assumption by such successor of the covenants of such
Issuer in accordance with the provisions of this Indenture;
(iv) to add to the covenants of the Issuers, for the
benefit of the Holders of all Notes, or to surrender any right or power
herein conferred upon any Issuer;
(v) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(vi) to cure any ambiguity, to correct or supplement any
provision herein which may be defective or inconsistent with any other
provisions with respect to matters or questions arising under this
Indenture, which shall not be inconsistent with the provisions of this
Indenture, provided that such action shall not adversely affect the
interests of the Holders of the Notes as evidenced by an Officer's
Certificate of the Servicer;
(vii) to evidence the succession of the Indenture Trustee
pursuant to Article VII; or
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(viii) to add to any Events of Default.
(b) The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but the Indenture
Trustee shall not be obligated to enter into any such supplemental indenture
that affects the Indenture Trustee's own rights, duties, liabilities or
immunities under this Indenture or otherwise. The Issuers will send a copy of
any such supplemental indenture to the Class A Note Insurer and each Holder
promptly following the execution and delivery thereof.
Section 9.02. Supplemental Indentures with Consent of Holders. (a) With the
consent of the Controlling Party, the Issuers and the Indenture Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby:
(i) change the Stated Legal Maturity Date or the due date
of any installment of principal of, or any installment of interest on,
any Note, or reduce the principal amount thereof or the rate of
interest thereon or change any place of payment where, or the coin or
currency in which, any Note or the interest thereon is payable, or
change the authorized denomination of any Note, or impair the right to
institute suit for the enforcement of any such payment;
(ii) reduce the percentage in principal amount of the
Outstanding Notes (or the Outstanding Notes of a Class), the consent of
the Holders of which is required for any such supplemental indenture,
or the consent of the Holders of which is required for any waiver of
compliance with certain provisions of this Indenture or certain
defaults hereunder or their consequences provided for in this Indenture
or the consent of which is required to waive any payment default on the
Notes;
(iii) modify or alter the provisions of the proviso to the
definition of the term "Outstanding"; or
(iv) permit the creation of any Lien ranking prior to or
on a parity with the Lien of this Indenture with respect to any
Collateral or, except as otherwise provided in Section 8.02, deprive
the Holder of any Note of the security afforded by the Lien of this
Indenture.
(b) Promptly after the execution by the Issuers and the Indenture
Trustee of any supplemental indenture pursuant to this Section 9.02, the Issuers
shall mail to the Class A Note Insurer and the Holders of the Notes to which
such supplemental indenture relates, a conformed copy of such supplemental
indenture. Any failure of the Issuers to mail such conformed copy, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such supplemental indenture.
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Section 9.03. Prospective Amendment of Eligibility Criteria and
Concentration Limits. Notwithstanding anything in this Article IX to the
contrary, the Controlling Party has the right, without needing the consent of
the Holders or the Indenture Trustee, to amend prospectively any of the
Eligibility Criteria and the Concentration Limits; provided, however, that if
the Controlling Party is not the Class A Note Insurer, the Rating Agency
Condition shall be met in connection with any such amendment.
Section 9.04. Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article IX or the modifications thereby of the trusts created by this
Indenture, the Indenture Trustee shall be entitled to receive upon request, and
(subject to Section 7.01) shall be fully protected in relying upon, an Opinion
of Counsel reasonably acceptable to the Indenture Trustee stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture. The Indenture Trustee may, but shall not (except to the extent
required in case of a supplemental indenture entered into under Section
9.01(a)(vii)) be obligated to, enter into any such supplemental indenture which
affects the Indenture Trustee's own duties or immunities under this Indenture or
otherwise.
Section 9.05. Effect of Supplemental Indentures. Upon the execution of any
supplemental indenture under this Article IX, this Indenture shall be modified
in accordance therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes, and every Holder of Notes theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
Section 9.06. Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuers shall so determine,
new Notes so modified as to conform, in the opinion of the Indenture Trustee and
the Issuers, to any such supplemental indenture may be prepared and executed by
the Issuers and authenticated and delivered by the Indenture Trustee in exchange
for outstanding Notes.
Section 9.07. Amendments to Other Transaction Documents. If the Indenture
Trustee shall be required to consent to an amendment, restatement, supplement or
other modification to any Transaction Document other than this Indenture, the
Indenture Trustee shall do so only upon receiving written direction or consent
from the Controlling Party; provided, however, that, if the Controlling Party is
not the Class A Note Insurer, the Indenture Trustee may act without such
direction or consent if the amendment, supplement or other modification is to
cure any ambiguity, to correct or supplement any provision which may be
defective or inconsistent with any other provisions with respect to matters or
questions arising under such Transaction Document, which shall not be
inconsistent with the provisions of such Transaction Document, but only if such
action shall not adversely affect the interests of the Holders of the Notes or
the Class A Note Insurer (in which case the Indenture Trustee shall act only at
the direction of all Holders and the Class A Note Insurer adversely affected).
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ARTICLE X
REPRESENTATIONS AND WARRANTIES
Section 10.01. Representations and Warranties. Each of the Issuers hereby
jointly represents and warrants to, and agrees with, the Indenture Trustee, the
Class A Note Insurer and the Holders that, as of the Closing Date:
(a) Each Issuer has been duly organized and is validly existing
and in good standing as entity of the type, and organized under the laws of the
jurisdiction, identified as the outset of this Indenture, with all requisite
power and authority to own its properties and to transact the business in which
it is now engaged, and each such Issuer is duly qualified to do business and is
in good standing in each jurisdiction where the nature of its business requires
it to be so qualified except where failure to so qualify would not have a
Material Adverse Effect. Each Issuer has all requisite power and authority and
has taken all action necessary to enter into this Indenture and the other
Transaction Documents to which it is a party, to consummate the transactions
contemplated hereby and thereby, and to perform its obligations hereunder and
thereunder. The execution, delivery and performance by each Issuer of this
Indenture and the other Transaction Documents are within such Issuer's powers,
have been duly authorized by all necessary action and do not contravene any
applicable Law, such Issuer's organizational documents or any contractual or
other obligation binding on or affecting such Issuer or any of its assets. The
chief place of business and chief executive office of each of each Issuers is
located at the address of such Issuer referred to in Section 15.03, and the
offices where such Issuer keeps all its books, records and documents relating to
the Railcar Assets are located at the addresses specified in Section 15.03. The
exact legal name of each Issuer is set forth on the signature page hereof and
each Issuer's organizational identification number is as follows: (i) for
NARCAT, 3686233, (ii) for NARCAT Mexico, none and (iii) for CARCAT, 3086095. No
Issuer has changed its name, changed its corporate structure, changed its
jurisdiction of organization, changed its chief place of business/chief
executive office or used any name other than its exact legal name at any time
during the past five years. Each Issuer has delivered to the Indenture Trustee
and the Class A Note Insurer a true and correct copy of each of its
organizational documents.
(b) The performance of each Issuer's obligations under this
Indenture and each other Transaction Document to which it is a party will not
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any Lien
(other as contemplated by this Indenture and the other Transaction Documents,
and other than Permitted Liens) upon any of the property or assets of such
Issuer pursuant to the terms of any indenture, mortgage, deed of trust, or other
agreement (including the Leases) or instrument to which it is a party or by
which it is bound or to which any of its property or assets is subject, nor will
such action result in any violation of the provisions of any organizational
document of such Issuer or any statute or any order, rule or regulation of any
court or Governmental Authority having jurisdiction over it or any of its
properties; and no consent, approval, authorization, order, registration or
qualification of or with any court, or any such Governmental Authority is
required for the consummation of the other transactions contemplated by this
Indenture or any other Transaction Document to which such Issuer is a party
except such
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consents, approvals and authorizations which have been obtained or such
registrations or qualifications which have been made.
(c) Each Transaction Document to which any Issuer is a party has
been duly authorized, executed and delivered by such Issuer and each such
Transaction Document is a valid and legally binding agreement of such Issuer,
enforceable against such Issuer in accordance with its terms, subject as to
enforceability to applicable bankruptcy, insolvency, reorganization and other
similar laws of general applicability relating to or affecting creditors' rights
generally and to general principles of equity regardless of whether enforcement
is sought in a court of law or equity.
(d) All Railcars are properly registered, to the extent required
pursuant to applicable Law, in jurisdictions within the United States, Canada or
Mexico, in the name of the respective Lessee or the applicable Issuer, to the
extent required by, and in accordance with, the laws of such jurisdiction. No
Issuer has received any notice of any Event of Loss, or any event which with the
passage of time or the giving of notice, or both, would constitute an Event of
Loss with respect to any Railcar.
(e) Each Issuer is the owner of each of the Railcar Assets, free
from any Lien, security interest, encumbrance or other right, title or interest
of any Person (other than Permitted Liens), subject however to the rights of the
Lessees in the Railcars under the related Leases and the rights of sublessees,
and each Issuer shall defend such Railcar Assets against all claims and demands
of all Persons at any time claiming the same or any interest therein adverse to
that of the Indenture Trustee.
(f) Each Issuer has heretofore provided to the Indenture Trustee
and the Class A Note Insurer copies, or access to original copies, of all of the
Leases, as amended, which copies are true and complete copies of the Leases, and
the Leases have not been amended or modified subsequent to the above copies
being made available to the Indenture Trustee and the Class A Note Insurer,
except immaterial amendments made in the ordinary course of business or as
reflected in the Lease and Railcar Schedule.
(g) All filings and recordings required to perfect the security
interest of the Indenture Trustee in the Non-Mexican Collateral will be
accomplished and will be in full force and effect no later than the Closing Date
or such later date as contemplated by the Transaction Documents.
(h) The Lease and Railcar Schedule contains a complete and correct
statement of the Rents payable by each Lessee specified therein, separately set
forth with respect to each separate Lease and each group of Railcars, for each
month for the number of months of anticipated Rents under each such Lease.
(i) [RESERVED.]
(j) The Delinquency Schedule attached as Schedule V hereto
contains a complete and correct statement of all Lessees that are, as of the
Closing Date, delinquent in making payments of the Rents due under the related
Leases and the number of days of each such delinquency.
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(k) Except with respect to Permitted Liens, this Indenture creates
in favor of the Indenture Trustee, for the benefit of the Secured Parties, a
legal, valid and enforceable security interest in the Collateral. The security
interest in the Non-Mexican Collateral granted to the Indenture Trustee pursuant
to this Indenture (i) constitutes a first priority perfected security interest
with respect to such Non-Mexican Collateral under any applicable Law and (ii)
will be entitled to all of the rights, benefits and priorities provided to a
holder of a first priority security interest under any such applicable Law. All
filings, deposits, registrations and other recordations shall have been
accomplished with respect to the Indenture in the United States and Canada (and
in each political subdivision thereof) as may be required by applicable Law to
establish and perfect the Indenture Trustee's rights in and to the Non-Mexican
Collateral therein, and any giving of notice or any other action to such end
required by applicable Law has been given or taken (including, without
limitation, the placement of notices in The Canada Gazette).
(l) No Default, Event of Default, Manager Event of Termination,
Servicer Event of Termination or event that with the passage of time or the
giving of notice or both would constitute a Default, Event of Default, Manager
Event of Termination, Servicer Event of Termination has occurred and is
continuing and no Rapid Amortization Event exists.
(m) Both before and after giving effect to the transactions
contemplated by this Indenture, each Issuer is Solvent.
(n) All information heretofore furnished by each Issuer to the
Indenture Trustee and Class A Note Insurer for purposes of or in connection with
this Indenture, the other Transaction Documents, or any transaction contemplated
hereby or thereby is, and all such information hereafter furnished by it
hereunder will be, true, complete and correct in every material respect, on the
date such information is stated or certified, and no such item contains or will
contain any untrue statement of a material fact or omits or will omit to state a
material fact necessary in order to make the statements contained therein, in
the light of the circumstances under which they were made, not misleading (it
being understood that with respect to any information received by each Issuer
from the Railcar Entities, the Sellers or any Lessee and furnished to the
Indenture Trustee and Class A Note Insurer, each Issuer represents that any such
information, to its knowledge, is true, complete and correct in every material
respect, on the date such information is stated or certified, and no such item
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material fact necessary in order to make the statements
contained therein, in the light of the circumstances under which they were made,
not misleading).
(o) Each Issuer has (i) except for a filing relating to NARCAT
Mexico, which will report zero tax due and owing, timely filed all federal,
state and local tax returns or permitted extensions thereof in the United States
and all other tax returns or permitted extensions thereof in foreign
jurisdictions required to be filed, (ii) paid or made adequate provision in
accordance with GAAP for the payment of all taxes, assessments and other
governmental charges and (iii) accounted for the sale of the Railcar Assets
hereunder, in its books and financial statements as sales, consistent with GAAP.
(p) Each Issuer is operated in such a manner that the separate
corporate existence of each Issuer, on the one hand, and the Railcar Entities
and the Initial Manager or any Affiliate
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thereof, on the other, would not be disregarded in the event of the bankruptcy
or insolvency of any of the Railcar Entities or the Initial Manager or any
Affiliate thereof or any Issuer and, without limiting the generality of the
foregoing:
(i) each Issuer is a limited purpose corporation whose
activities are restricted in its organizational documents to activities
related to purchasing or otherwise acquiring the Railcar Assets and
related assets and rights and conducting any related or incidental
business or activities it deems necessary or appropriate to carry out
its primary purpose, including entering into the Indenture and the
other Transaction Documents;
(ii) no Issuer has engaged, or presently engages, in any
activity other than those activities expressly permitted hereunder and
under the other Transaction Documents, nor has each Issuer entered into
any agreement other than this Indenture, the other Transaction
Documents to which it is a party, and with the prior written consent of
the Controlling Party, any other agreement necessary to carry out more
effectively the provisions and purposes hereof or thereof;
(iii) (A) each Issuer maintains its own deposit account or
accounts, separate from those of any of its Affiliates, with commercial
banking institutions, (B) the funds of each Issuer are not and have not
been diverted to any other Person for any use other than the corporate
use of each Issuer, and (C), except as may be expressly permitted or
required by this Indenture or any other Transaction Document, the funds
of each Issuer are not and have not been commingled with those of any
other Person;
(iv) to the extent that any Issuer contracts or does
business with vendors or service providers where the goods and services
provided are partially for the benefit of any other Person, the costs
incurred in so doing are fairly allocated to or among such Issuer and
such entities for whose benefit the goods and services are provided,
and such Issuer and each such entity bears its fair share of such
costs; and all material transactions between each Issuer and any of its
Affiliates shall be only on an arm's-length basis;
(v) each Issuer maintains a principal executive and
administrative office through which its business is conducted and a
telephone number and stationery through which all business
correspondence and communication are conducted separate from those of
its Affiliates;
(vi) each Issuer conducts its affairs strictly in
accordance with its organizational documents and observes all
necessary, appropriate and customary corporate formalities, including
(A) holding all regular and special equity holders' and directors' or
managers', as applicable, meetings appropriate to authorize all company
action (which, in the case of regular equity holders' and directors' or
managers', as applicable, meetings, are held at least annually), (B)
keeping separate and accurate minutes of such meetings, (C) passing all
resolutions or consents necessary to authorize actions taken or to be
taken, and (D) maintaining accurate and separate books, records and
accounts, including intercompany accounts;
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(vii) all decisions with respect to each Issuer's business
and daily operations are independently made by such Issuer (although
the officer making any particular decision may also be an employee,
officer or director of an Affiliate of another Issuer) and are not
dictated by any Affiliate of such Issuer (it being understood that the
Manager, which is an Affiliate of such Issuer, will undertake and
perform all of the operations, functions and obligations of it set
forth in the Management Agreement and it may appoint sub-Managers,
which may be Affiliates of such Issuer, to perform certain of such
operations, functions and obligations and that the Servicer, which is
an Affiliate of such Issuer, will undertake and perform all of the
operations, functions and obligations of it set forth the Servicing
Agreement and it may appoint sub-Servicers, which may be Affiliates of
such Issuer, to perform certain of such operations, functions and
obligations);
(viii) each Issuer acts solely in its own name and through
its own authorized officers and agents, has not held itself out as a
"division" or "part" of any other Person, and no Affiliate of such
Person shall be appointed to act as its agent, except as expressly
permitted by this Indenture and the other Transaction Documents;
(ix) no Affiliate of any Issuer advances funds to such
Issuer, other than as is otherwise expressly provided herein or in the
other Transaction Documents, and no Affiliate of any Issuer (other than
pursuant to the express terms of the Transaction Documents) otherwise
supplies funds to, or guaranties debts of, any other Issuer;
(x) other than organizational expenses and as expressly
provided herein, each Issuer pays all expenses, indebtedness and other
obligations incurred by it;
(xi) no Issuer guarantees, or is otherwise liable for, any
obligation of any of its Affiliates (other than the other Issuers
pursuant to the Transaction Documents);
(xii) any financial reports required of any Issuer comply
with GAAP and are issued separately from, but may be consolidated with,
any reports prepared for any of its Affiliates;
(xiii) each Issuer is adequately capitalized to engage in
the transactions contemplated in its organizational documents;
(xiv) no Issuer acts as agent for any of its Affiliates,
but instead presents itself to the public as an entity separate from
each such Affiliate and independently engaged in the business of
purchasing and financing Railcar Assets;
(xv) NARCAT maintains a board of managers consisting of
three individuals, CARCAT maintains a board of directors consisting of
three individuals and NARCAT Mexico maintains a board of managers
consisting of three individuals. Each Issuer's board of managers or
board of directors, as applicable, includes at least one independent
director or manager, as applicable, (A) who is not currently or within
the preceding five years has been: (1) a stockholder, director,
officer, employee, manager, or partner of The Andersons or any
Affiliate of The Andersons (other than as an independent director or
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manager of any Issuer, Seller or Holdco), (2) a direct or indirect
holder of any voting securities of The Andersons or any Affiliate of
The Andersons, (3) a creditor, supplier, contractor or any other person
who derives any of its purchases or revenues from its activities with
The Andersons or any of The Andersons' other Affiliates, or (4) a
member of the immediate family of any stockholder, director, officer,
employee, partner, customer, supplier or contractor of The Andersons or
any of its other Affiliates, and (B) who has (1) prior experience as an
independent director for a corporation whose charter documents required
the unanimous consent of all independent directors thereof before such
corporation could consent to the institution of bankruptcy or
insolvency proceedings against it or could file a petition seeking
relief under any applicable federal or state law relating to
bankruptcy; and (2) is employed with one or more entities that provide,
in the ordinary course of their respective businesses, advisory,
management or placement services to issuers of securitization or
structural finance instruments, agreements or securities; and
(xvi) the organizational documents of each Issuer require
(A) the affirmative vote of an independent director or manager, as
applicable, before a voluntary petition under Section 301 of the
Bankruptcy Code or analogous petition under any other insolvency law
may be filed by such Person, and (B) such Person to maintain correct
and complete books and records of account and minutes of the meetings
and other proceedings of its stockholders and board of directors or
managers, as applicable.
Without limiting the foregoing, all of the factual statements and assumptions
relating to each Issuer that are set forth in each of the opinions relating to
bankruptcy matters and delivered pursuant to Section 4.01(f) are true and
correct.
(q) The sale, transfer, assignment and conveyance contemplated by
this Indenture is not subject to and will not result in any tax, fee or
governmental charge payable by any Issuer to any Governmental Authority
("Transfer Taxes"), other than Transfer Taxes which have been or will be paid by
such Issuer as due. In the event that any Issuer receives actual notice of any
Transfer Taxes arising out of such transfer, assignment and conveyance, on
written demand by Indenture Trustee and Class A Note Insurer, or upon any Issuer
otherwise being given notice thereof, such Issuer shall pay, and otherwise
indemnify and hold Indenture Trustee and Class A Note Insurer harmless, from and
against any and all such Transfer Taxes.
(r) No Issuer has any material intellectual property.
(s) There have been no Proceedings made or brought by or against
Issuers or settled or terminated in the period beginning on its date of
formation, or, to the knowledge of any Issuer, threatened or contemplated, in
each case that, in the reasonable judgment of any Issuer, if adversely
determined, would have a Material Adverse Effect.
(t) No Issuer maintains, participates in or contributes to any (A)
deferred compensation or retirement plan or arrangement, (B) tax-qualified or
nonqualified defined contribution or defined benefit plan or arrangement which
is an employee pension benefit plan (as defined in Section 3(2) of ERISA), (C)
employee welfare benefit plan (as defined in Section 3(1) of
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ERISA), (D) phantom stock appreciation right, stock option, stock purchase or
other stock based plan, or (E) any fringe benefit plan or program. No Issuer
maintains or contributes to any employee welfare benefit plan that provides
health, accident or life insurance benefits to former employees, their spouses
or dependents, other than in accordance with Section 4980B of the U.S. Tax Code
or Part 6 of Subtitle B of Title I of ERISA or other applicable Law.
(u) No Issuer is party to, bound by, or negotiating in respect of
any collective bargaining agreement or any other agreement with any labor union,
association or other employee group in connection with its railcar leasing
business, nor, to the knowledge of any Issuer, is any employee that primarily
works in connection with its railcar leasing business represented by any labor
union or similar association. No labor union or employee organization has been
certified or recognized as the collective bargaining representative of any
employee of such Issuer that primarily works in connection with its railcar
leasing business. To the knowledge of each Issuer, there are no formal union
organizing campaigns or representation proceedings in process or formally
threatened with respect to any employee of each Issuer that primarily work in
connection with its railcar leasing business, nor are there any existing or, to
the knowledge of each Issuer, threatened at large labor strikes, work stoppages,
organized slowdowns, unfair labor practice charges, or labor arbitration
proceedings affecting employees of such Issuer that primarily work in connection
with its railcar leasing business.
(v) Except to the extent such matters would not have a Material
Adverse Effect on the Railcar Assets:
(i) to the knowledge of each Issuer, the Railcar Assets
owned by it are in compliance with all applicable Environmental Laws
related to the Collateral. Except for matters that have been fully
resolved, each Issuer has not received any written communication from
any person or Governmental Authority that alleges that its operations
in connection with the Collateral are not in compliance with applicable
Environmental Laws;
(ii) to the knowledge of such Issuer, it has obtained all
environmental, health and safety permits and governmental
authorizations (collectively, the "Environmental Permits") necessary
for the conduct of its railcar leasing business, and all such permits
are in good standing or, where applicable, a renewal application has
been timely filed and is pending agency approval, and to the knowledge
of each Issuer, such Issuer is in compliance with all terms and
conditions of the Environmental Permits; and
(iii) there is no Environmental Claim pending or, to the
knowledge of each Issuer, threatened against or concerning the Railcar
Assets.
To the knowledge of each Issuer, no release of any Hazardous Commodity has
occurred on or from any of the Railcar Assets, which requires investigation,
assessment, monitoring, remediation or cleanup under Environmental Laws.
(w) Each Issuer has complied with all "bulk sales" laws of its
jurisdiction of organization and principal place of business.
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(x) Each Issuer hereby jointly and severally represents and
warrants to, and agrees with, the Indenture Trustee, the Class A Note Insurer
and the Holders, that each Railcar and Lease included in the Collateral is an
"Eligible Railcar" or "Eligible Lease," as applicable.
(y) Each Issuer remakes each of the representations and warranties
made by it in each of the other Transaction Documents to which each Issuer is a
party, as if the same were set forth in full herein.
(z) No Issuer has any Subsidiaries. No Issuer owns, beneficially
or of record, any capital stock, evidences of Indebtedness or other securities
of, nor has made any loans or advances to nor has any investments or interests
in, any Person, other than Eligible Investments.
(aa) No Issuer is an "investment company" or a company "controlled"
by an "investment company" within the meaning of the Investment Company Act of
1940, as amended.
(bb) Since its date of formation, no Material Adverse Change has
occurred with respect to any Issuer.
(cc) The proceeds of (A) the Class A-1 Notes, Class A-2 Notes and
Class B Notes shall be used solely by NARCAT and NARCAT Mexico, and (B) the
Class A-3 Notes shall be used solely by CARCAT, for the purchase of the Railcar
Assets, to make deposits to the Collection Accounts and, in the case of NARCAT
and NARCAT Mexico, the Prefunding Account, and to pay expenses related to this
Indenture and the other Transaction Documents. No Issuer will, directly or
indirectly, use any portion of the proceeds of the Notes hereunder for the
purpose of purchasing or carrying any margin stock within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System or to
extend credit to any Person for the purpose of purchasing or carrying any such
margin stock.
(dd) No procedures believed to be adverse to the interests of any
of the Secured Parties were used by any Issuer, the Seller, the Manager or the
Servicer in identifying and/or selecting and/or transferring the Railcar Assets
to each Issuer and Granting the Collateral to the Indenture Trustee on behalf of
the Secured Parties.
(ee) Each Issuer shall have given reasonably equivalent value in
consideration for the transfer to each Issuer of the Railcar Assets pursuant to
the Sale Agreement to which it is a party, no such transfer shall have been made
for or on account of an antecedent debt, and no such transfer is or may be
voidable or subject to avoidance under any applicable bankruptcy law.
ARTICLE XI
COVENANTS
Section 11.01. Payment of Principal and Interest. The Issuers, jointly and
severally, will duly and punctually pay or cause to be paid the principal of and
interest on the Notes in accordance with the terms of the Notes and this
Indenture.
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Section 11.02. Maintenance of Office or Agency. The Issuers will maintain
an office or agency within the United States of America where Notes may be
presented or surrendered for payment, where Notes may be surrendered for
registration of transfer or exchange and where notices and demand to or upon the
Issuers in respect of the Notes and this Indenture may be served. The Issuers
hereby initially appoint the Indenture Trustee at its Corporate Trust Office for
each of said purposes. The Issuers will give prompt written notice to the Class
A Note Insurer and the Indenture Trustee of the location, and of any change in
the location, of any such office or agency. If at any time the Issuers shall
fail to maintain any such office or agency or shall fail to furnish to the Class
A Note Insurer and the Indenture Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Indenture Trustee and the Issuers hereby appoint the Indenture Trustee its agent
to receive all such presentations, surrenders, notices and demands.
Section 11.03. Money for Note Payments to Be Held in Trust. If there is any
Paying Agent other than the Indenture Trustee, the Issuers will cause each
Paying Agent other than the Indenture Trustee to execute and deliver to the
Indenture Trustee an instrument in which such Paying Agent shall agree with the
Indenture Trustee that, subject to the provisions of this Section 11.03, such
Paying Agent will:
(a) hold all sums held by it for the payment of principal
of or interest on Notes in trust for the benefit of the Holders
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided;
(b) give the Indenture Trustee notice of any Default or
Event of Default by the Issuers (or any other obligor upon the Notes)
in the making of any payment of principal or interest; and
(c) at any time during the continuance of any such
Default or Event of Default, upon the written request of the Indenture
Trustee, forthwith pay to the Indenture Trustee all sums so held in
trust by such Paying Agent.
The Issuers may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Issuer Order direct any Paying Agent to pay, to the Indenture Trustee all
sums held in trust by such Paying Agent, such sums to be held by the Indenture
Trustee upon the same trusts as those upon which such sums were held by such
Paying Agent; and, upon such payment by any Paying Agent to the Indenture
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Indenture Trustee or any Paying Agent in
trust for the payment of the principal of or interest on any Note and remaining
unclaimed for six years after such principal or interest has become due and
payable shall be paid to or at the direction of the Issuers on Issuer Request;
and the Holder of such Note shall thereafter, as an unsecured general creditor,
and subject to any applicable statute of limitations, look only to the Issuers,
jointly and severally, for payment thereof, and all liability of the Indenture
Trustee or such Paying Agent with respect to such trust money, shall thereupon
cease; provided, however, that the Indenture Trustee or such Paying Agent,
before being required to make any such repayment, may at the
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expense of the Issuers cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in the city in which the Corporate Trust Office is located, notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such publication, any
unclaimed balance of such money then remaining will be repaid to the Issuers.
The Indenture Trustee may also adopt and employ, at the expense of the Issuers,
any other reasonable means of notification of such repayment (including, but not
limited to, mailing notice of such repayment to Holders whose right to or
interest in monies due and payable but not claimed is determinable from the
records of any Paying Agent, at the last address as shown on the Note Register
for each such Holder).
Section 11.04. Corporate Existence. Each Issuer will keep in full effect
its existence, rights and franchises as a limited liability company, a Nova
Scotia unlimited liability company or a Mexican limited liability company with
variable capital, respectively, under the laws of its jurisdiction, will operate
in accordance with, and subject to the limitations set forth in, its formation
documents, and will obtain and preserve its qualification to do business as a
foreign entity in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Indenture, the
Notes and each other Transaction Document to which it is a party.
Section 11.05. Protection of Collateral. (a) The Issuers will from time to
time execute and deliver all such supplements and amendments hereto and all such
financing statements, continuation statements, instruments of further assurance
and other instruments as are necessary to protect the Collateral, and will take
such other actions as the Indenture Trustee or the Class A Note Insurer
reasonably deems necessary or advisable to:
(i) Grant more effectively any or all of the Collateral;
(ii) maintain or preserve the Lien of this Indenture and
the first priority perfected nature of such Lien (subject only to
Permitted Liens) or carry out more effectively the purposes hereof;
(iii) perfect, publish notice of, or protect the validity
of any Grant made or to be made by this Indenture;
(iv) enforce any rights arising under or with respect to
any of the Railcar Assets or, where appropriate, any security interest
in the Collateral and the proceeds thereof; or
(v) preserve and defend title to the Collateral and the
rights of the Indenture Trustee, the Class A Note Insurer and the
Holders therein against the claims of all Persons and parties.
Without limiting the generality of the foregoing, each Issuer will (i)
authenticate or execute and file such financing or continuation statements, or
amendments thereto, and such other instruments or notices as may be necessary,
or as the Indenture Trustee or the Class A Note
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Insurer may reasonably request, in order to perfect and preserve the pledges,
assignments and security interests of the Collateral granted or purported to be
granted hereby, (ii) at the request of the Indenture Trustee, the Class A Note
Insurer (if the Class A Notes are still Outstanding) or the Controlling Party
(if not the Class A Note Insurer) during the continuance of any Default, Event
of Default, Manager Event of Termination, Servicer Event of Termination or any
event that with the passage of time or the giving of notice or both would become
a Manager Event of Termination or a Servicer Event of Termination, xxxx
conspicuously each document included in the Collateral and each of its records
pertaining to the Collateral with a legend, in form and substance satisfactory
to the Indenture Trustee, the Class A Note Insurer (if the Class A Notes are
still Outstanding) and the Controlling Party (if not the Class A Note Insurer),
including that such document, chattel paper or record is subject to the pledge,
assignment and security interest granted hereby, (iii) if any Collateral shall
be evidenced by a promissory note or other instrument or chattel paper, deliver
and pledge to the Indenture Trustee hereunder such note or instrument or chattel
paper duly endorsed and accompanied by duly executed instruments of transfer or
assignment, all in form and substance satisfactory to the Indenture Trustee, the
Class A Note Insurer (if the Class A Notes are still Outstanding) and the
Controlling Party (if not the Class A Note Insurer) and (iv) take such steps as
the Indenture Trustee, the Controlling Party (if not the Class A Note Insurer)
or the Class A Note Insurer (if the Class A Notes are still Outstanding) may
reasonably request for the Indenture Trustee (A) to obtain an acknowledgement,
in form and substance satisfactory to the Indenture Trustee and the Controlling
Party (if not the Class A Note Insurer) or the Class A Note Insurer (if the
Class A Notes are still Outstanding), of any bailee having possession of any of
the Collateral that the bailee holds such Collateral for the Indenture Trustee
or (B) to obtain "control" of any Investment Property, Deposit Accounts,
Letter-of-Credit Rights or electronic chattel paper with any agreements
establishing control to be in form and substance satisfactory to the Indenture
Trustee and the Controlling Party (if not the Class A Note Insurer) or the Class
A Note Insurer (if the Class A Notes are still Outstanding). A photocopy or
other reproduction of this Indenture or any security agreement or financing
statement covering the Collateral or any part thereof shall be sufficient as a
financing statement where permitted by applicable Law.
(b) If an Event of Default shall have occurred and be continuing,
each Issuer hereby irrevocably designates the Indenture Trustee as its agent and
attorney-in-fact to authorize any financing statement, continuation statement or
other instrument required pursuant to this Section 11.05; provided, however,
that the Indenture Trustee shall not be obligated to authorize or file such
instruments except upon written instruction from the Servicer, the Manager, the
Issuers or the Controlling Party to authorize such instruments. Such power of
attorney shall be deemed coupled with an interest and be irrevocable.
(c) Each Issuer will furnish to the Indenture Trustee and the
Controlling Party or the Class A Note Insurer (if the Class A Notes are still
Outstanding) from time to time statements and schedules further identifying and
describing the Collateral and such other reports in connection with the
Collateral as the Indenture Trustee, the Controlling Party (if not the Class A
Note Insurer) or the Class A Note Insurer may reasonably request, all in
reasonable detail. Each Issuer hereby authorizes the Indenture Trustee to regard
its printed name or rubber stamp signature on statements or schedules as the
equivalent of a manual signature by an authorized officer or agent of such
Issuer.
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Section 11.06. Negative Covenants. No Issuer will:
(a) sell, transfer, exchange, assign (by operation of law
or otherwise) or otherwise dispose of any of the Collateral (except as
provided in Section 8.02) or assign any right to receive income in
respect thereof;
(b) claim any credit on, or make any deduction from, the
principal or interest payable in respect of the Notes by reason of the
payment of any taxes levied or assessed upon any of the Collateral;
(c) amend, restate, alter, change or repeal its
certificate of formation or any other organizational document thereof
without the consent of the Controlling Party;
(d) as to the initial issuance of the Class A Notes under
this Indenture, issue such Notes unless such Notes have been rated at
least "AAA" by S&P and "AAA" by Fitch, and as to the initial issuance
of the Class B Notes under this Indenture, issue such Notes unless such
Notes have been rated at least "B" by S&P; nor will any Issuer issue
any subsequent incurrence of debt pursuant to any other notes, bonds,
securities, or other obligations other than trade payables and expense
accruals incurred in the ordinary course of business and which are
incidental to its business purpose, for so long as the Notes remain
outstanding;
(e) (i) permit the validity or effectiveness of this
Indenture or any Grant under this Indenture to be impaired, or permit
this Indenture to be amended, hypothecated, subordinated, terminated or
discharged, or permit any Person to be released from any covenants or
obligations under this Indenture, except as may be expressly permitted
hereby and thereby, (ii) permit any Lien (other than Permitted Liens),
charge, security interest, mortgage or other encumbrances to be created
on or extended to or otherwise arise upon or burden the Collateral or
any part thereof or any interest therein or the proceeds thereof, or
(iii) permit this Indenture not to constitute a valid first priority
security interest in the Collateral, subject only to Permitted Liens;
or
(f) dissolve or liquidate in whole or in part.
Section 11.07. Statement as to Compliance. Each Issuer will deliver to the
Indenture Trustee, the Class A Note Insurer, the Rating Agency, and to each
Holder of the Notes, on or before each December 31 (commencing December 31,
2004), a written statement signed by an Authorized Officer of such Issuer,
stating, as to the signer thereof, that:
(a) a review of the activities of such Issuer during the
preceding year and of performance under this Indenture has been made
under his or her supervision, and
(b) such Issuer has fulfilled all of its obligations
under this Indenture throughout such year, or, if there has been a
default in the fulfillment of any such obligation, specifying each such
Default known to him or her and the nature and status thereof.
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Section 11.08. Investment Company Act. Each Issuer will conduct its
operations in a manner which will not subject it to registration as an
"investment company" under the Investment Company Act of 1940.
Section 11.09. Enforcement of Servicing Agreement, Management Agreement,
Sale Agreements and Funds Transfer Agreement. Each Issuer will take all actions
necessary, and diligently pursue all remedies available to it, to the extent
commercially reasonable, to enforce the obligations of the Servicer under the
Servicing Agreement, the Manager under the Management Agreement, each Seller
under the related Sale Agreement and each party under the Funds Transfer
Agreement and to secure its rights thereunder.
Section 11.10. Issuers May Not Consolidate. Except as otherwise expressly
permitted hereunder (including without limitation, in accordance with Section
11.06(a)), no Issuer shall consolidate, amalgamate or merge with or into any
other Person or convey or transfer its properties and assets substantially as an
entirety to any Person.
Section 11.11. Opinions as to Collateral. On or before June 30 in each
calendar year commencing with 2005, each Issuer, with respect to that part of
the Collateral Granted by such Issuer to the Indenture Trustee, shall furnish to
the Indenture Trustee an Opinion of Counsel either stating that, in the opinion
of such counsel, such action has been taken during the immediately preceding
12-month period with respect to the recording, filing, re-recording and refiling
of this Indenture, any indentures supplemental hereto and any other requisite
documents, and with respect to the authorization and filing of any financing
statements and continuation statements as is necessary to maintain the Lien and
security interest created by this Indenture and the Sale Agreements and reciting
the details of such action or stating that in the opinion of such counsel no
such action is necessary to maintain such Lien and security interest. Such
Opinion of Counsel shall also describe the recording, filing, re-recording and
refiling of this Indenture, any indentures supplemental hereto and the Sale
Agreements and any other requisite documents and the execution and filing of any
financing statements and continuation statements that will, in the opinion of
such counsel, be required to maintain the Lien and security interest of this
Indenture until June 30 in the following calendar year.
Section 11.12. Performance of Obligations. No Issuer will take any action,
and each Issuer will use its best efforts not to permit any action to be taken
by others, that would release any Person from any of such Person's covenants or
obligations under any instrument included in the Collateral, or which would
result in the amendment, hypothecation, subordination, termination or discharge
of, or impair the validity or effectiveness of, any such instrument, except as
expressly provided in this Indenture, the Servicing Agreement, the related Sale
Agreement or the Management Agreement or such other instrument.
Section 11.13. Pro-Rata Purchases. None of the Issuers will, directly or
indirectly, through any Affiliate or otherwise, purchase or otherwise acquire
(otherwise than by prepayment required or permitted by this Indenture) or
solicit any offers to (a) sell Class A Notes except pursuant to invitation to
tender Class A Notes, at the same price, and the same terms, made concurrently
to all Holders of Outstanding Class A Notes, or (b) sell Class B Notes except
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pursuant to an invitation to tender Class B Notes, at the same price, and the
same terms, made concurrently to all Holders of Outstanding Class B Notes.
Section 11.14. Insurance. (a) Required Insurance. Each Issuer hereby agrees
that such Issuer will maintain insurance or require each Lessee to maintain
insurance at all times while the Indenture is in effect with insurers or
re-insurers of recognized reputation and responsibility (the "Insurers") as
follows:
(i) Property Insurance. Each Issuer either (A) will
maintain "all risk" property insurance in respect of the Railcars and
for an amount not less than $5,000,000 per occurrence and with no
limits on the maximum number of covered occurrences (such that there
are no limitations on the number of "occurrences" covered by such
insurance during the term of any such insurance policy) or (B) where
the Lessee is required to carry insurance, will cause the Lessee to
carry insurance in limits as determined in accordance with Rule 107 of
the Interchange Rules ("Property Insurance"); and
(ii) Liability Insurance. Liability insurance with respect
to third-party personal injury, death and property damage (including
contractual liability insurance), Federal Employers Liability Act
coverage and against risks as are customarily carried in the United
States, Canada or Mexico by owners or lessors of rolling stock similar
to the Railcars (and, in any event, covering such risks as are covered
by each Issuer's liability insurance in effect on the Closing Date) in
an amount, in the case of each Issuer, not less than $5,000,000 per
occurrence with no limits on the maximum number of covered occurrences
(such that there are no limitations on the number of "occurrences"
covered by such insurance during the term of any such insurance policy)
and, in the case of any Lessee, not less than such amount per
occurrence with a deductible per occurrence of not more than such
amount as the Manager determines, in its reasonable judgment and in
accordance with the management standards set forth in the Management
Agreement, to be prudent and, in any event, not less than such amounts
(with not more than such deductibles) as Lessees are customarily
required to carry in the United States, Canada or Mexico by owners or
lessors of rolling stock similar to the Railcars ("Liability
Insurance").
(b) Self-insurance. The Issuers may permit any Lessee, in lieu of
the requirements set forth above, to self-insure Railcars leased thereto with
respect to Property Insurance and, to the extent such failure does not adversely
affect an Issuer's liability insurance, Liability Insurance; provided, however,
that, except with respect to any Railcars leased to a Preferred Lessee, the
aggregate amount of liability which shall be subject to such self-insurance
shall not, in respect of any Lessee, exceed $250,000. "Self-insure" and
"self-insurance" shall mean uninsured risk, deductible and co-insurance.
"Preferred Lessee" shall mean any Lessee having a long-term debt credit rating
(or shadow rating) of BBB- or higher by S&P, BBB- or higher by Fitch or Baa3 or
higher by Xxxxx'x.
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(c) Terms of Insurance. The insurance policies carried by the
Issuers in accordance with the terms of this Indenture shall:
(i) require 30 days' prior notice to the additional
insureds of cancellation for any reason or material change in the type
or limits of coverage and provide that one or more of the additional
insureds may renew such coverage;
(ii) not require contributions from other policies held by
the additional insureds;
(iii) waive any right of subrogation of the insurers
against the additional insureds;
(iv) (A) name the Indenture Trustee and the Class A Note
Insurer as additional insureds in the case of Liability Insurance, and
(B) name the Indenture Trustee as loss payee in the case of Property
Insurance;
(v) continue to insure such additional insured regardless
of any breach or violation of any warranty, declaration or condition
contained in such policy by the Issuers or any Person; and
(vi) waive any right to claim any premium or commissions
against the additional insured.
If any Issuer is in default of its obligation to maintain, or, with respect to
Property Insurance, cause the Lessee to maintain, the insurance coverages
specified herein, the Indenture Trustee may (with the consent of the Controlling
Party), at its option, but shall not be required to (unless directed to do so by
the Controlling Party), obtain such insurance, and in such event, each Issuer
shall, upon demand from time to time, reimburse the Indenture Trustee for the
cost of such insurance which each Issuer shall have failed to maintain and which
the Indenture Trustee shall have obtained in accordance herewith, together with
interest thereon at the Overdue Rate, from the date of payment thereof to but
excluding the date of receipt of such reimbursement.
(d) Certificates. From time to time, but not more than once in any
12-month period, upon the request of the Indenture Trustee (acting at the
direction of the Controlling Party), the Issuers shall provide certificates of
insurance to the Indenture Trustee and the Class A Note Insurer evidencing that
the insurance required of the Issuers by this Section 11.14 is in effect.
(e) The Issuers' Agreements. The Issuers will not:
(i) make, or permit the making of, any modification to
any insurance required hereunder without the prior written consent of
the Indenture Trustee acting at the direction of the Controlling Party;
or
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(ii) cause or permit any Railcars to be employed in any
place or in any manner or for any purpose inconsistent with the terms
of or outside the coverage provided by any required insurance.
(f) Change in Industry Practice. In the event that there is a
material change in generally accepted industry-wide practice with regard to the
insurance of Railcars (whether relating to any or all of the types of insurance
required to be effected under the foregoing provisions of this Section 11.14)
such that the insurance required pursuant to the provisions of this Section
11.14 is insufficient to protect the interests of the Indenture Trustee, the
Class A Note Insurer or any Holder hereunder, then, unless such an action would
be contrary to the provisions of any Lease to which the relevant Railcars may
then be subject, the insurance requirements set forth in this Section 11.14
shall be varied so as to include such additional or varied requirements as may
be reasonably necessary to ensure that the insurance as so varied shall provide
comparable protection to that which would have been provided if such change in
generally accepted industry-wide practice had not occurred.
(g) Compliance with Legal Requirements. In addition to the
foregoing provisions of this Section 11.14, the Issuers shall comply with all
legal requirements as to the insurance of any Railcars which may from time to
time be imposed by the Laws of the United States, Canada or Mexico, as
applicable, or any jurisdiction to or from which any Railcars shall travel or in
which the same shall be located or by the AAR.
(h) No Reliance on and Release of Indenture Trustee. In connection
with the covenants set forth in this Section 11.14, it is understood and agreed
that:
(i) neither the Indenture Trustee nor its agents or
employees shall be liable for any loss or damage insured by the
insurance policies required to be maintained under this Section 11.14,
it being understood that each Issuer shall look solely to its insurance
companies or any other parties other than the aforesaid parties for the
recovery of such loss or damage. If any such insurance policy does not
provide waiver of subrogation rights against the additional insured, as
required in Section 11.14(c)(iii), then the Issuers hereby agree, to
the extent permitted by applicable Law, to waive its right of recovery,
if any, against the Indenture Trustee and its agents and employees in
respect of any such loss or damage; and
(ii) the designation of any form, type or amount of
insurance coverage by the Issuers under this Section 11.14 shall in no
event be deemed a representation, warranty or advice by the Indenture
Trustee that such insurance is adequate for the purposes of the
business of the Issuers or the protection of its properties.
Section 11.15. Leasing of Railcars. (a) No Issuer shall, without the prior
written consent of the Controlling Party, sell, contract to sell, lease, assign,
encumber or otherwise dispose of, transfer or relinquish possession or control
of, any or all Railcars or any interest therein, except as expressly permitted
by, and in accordance with, the provisions hereof (including, without
limitation, Section 6.18 and this Section 11.15). The Railcars shall at all
times be in the possession of or under the control of the Issuers, the Servicer,
the Manager or, to the extent such
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Railcar is then the subject of an unexpired Lease permitted hereby, the Lessee
thereof, a permitted sublessee thereunder or, in addition (in the case of any
Per Diem Lease or Operating Agreement), the Person obligated to make payments of
Railroad Mileage Credits thereunder; provided that, subject to the terms of the
Management Agreement, an Issuer or the Manager may relinquish possession to
parties in the business and capable of repairing Railcars for the limited
purpose of effecting such repairs.
(b) The Issuers shall use their best efforts (and shall cause the
Manager to use its best efforts) to cause each Railcar to be subject to, and
maintained under, a Lease. During any period that a Railcar is not then subject
to a Lease (due to being taken out of service for repair or otherwise), the
Issuers shall take (or cause the Manager to take) reasonable care to prevent
deterioration of the condition of such Railcar (solely in the case of a Railcar
being repaired, beyond that attributable to the circumstances necessitating such
repair) and to keep such Railcar otherwise eligible for applicable
manufacturer's warranties, if any.
(c) The Issuers shall have the right to enter into a Lease, as
lessor or owner thereof, with respect to a Railcar, without the consent of the
Indenture Trustee or any Holder (each such Lease, a "Subsequent Lease"), and
NARCAT can accept the transfer of the Prefunded Existing Leases and the
Prefunded Railcars from the U.S. Seller on the Prefunded Railcar Acquisition
Date, so long as the following concentration limits (the "Concentration Limits")
are satisfied as of the date on which any Subsequent Lease is originated (or, if
later, the date on which any Subsequent Lease is transferred to an Issuer) or as
of the Prefunded Railcar Acquisition Date, as applicable, unless waived in
writing by the Controlling Party:
(i) not more than 10% of all Railcars may be leased to
any one Lessee (including all Affiliates thereof), unless such Lessee
shall both (i) have a long-term unsecured debt rating of "BBB" or
higher by S&P, "BBB" or higher by Fitch or "Baa" or higher by Xxxxx'x
(the "Minimum Long-Term Rating") and (ii) not have a long-term
unsecured debt rating of less than the Minimum Long-Term Rating from
any of S&P, Fitch or Xxxxx'x, in which case not more than 20% of all
Railcars may be leased to any such Lessee (including all Affiliates
thereof);
(ii) not more than 60% of all Railcars may be leased to
any set of ten Lessees (including for this purpose any Lessee and all
Affiliates thereof as a single Lessee);
(iii) Railcars subject to Per Diem Leases may not account
more than 40% of the Stated Value of all Railcars;
(iv) Railcars subject to Leases with governmental agencies
or authorities may not account for more than 7.5% of the Stated Value
of all Railcars; and
(v) not more than 450 of the Railcars are leased to
Lessees for which a Mexican address is referenced on the Lease;
provided, however, that (a) a Subsequent Lease shall be deemed to have been
originated in compliance with the Concentration Limits notwithstanding the fact
that, at the time of such
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origination, the portfolio of Railcars and associated Leases included in the
Collateral shall not be in compliance with one or more of the Concentration
Limits (each Concentration Limit as to which there shall be non-compliance, a
"Tripped Concentration Limit") so long as such origination shall not (i) cause
said portfolio to fail to be in compliance with any other Concentration Limit,
or (ii) cause said portfolio to be further from compliance with any Tripped
Concentration Limit, and (b) with the consent of the Controlling Party, a
Subsequent Lease with respect to any Lessee shall be deemed to have been
originated in compliance with the Concentration Limits notwithstanding the fact
that a downgrade or withdrawal of a debt rating in respect of such Lessee would
otherwise have resulted in the existence of a Tripped Concentration Limit.
(d) The applicable Issuer shall use its best efforts to maintain
in full force and effect all of its rights, as lessor, and all of the Lessee's
obligations, as Lessee, under each Lease and shall take such action as is
necessary to enforce its rights and the Lessee's obligations thereunder. Such
Issuer shall not waive an event of default under a Lease unless no Event of
Default then exists hereunder and such waiver and failure of Lessee to comply
with the relevant obligation (including with respect to the removal of any
Liens) does not affect the then fair market value, utility or remaining useful
life of the relevant Railcars. In no event shall any such waiver alter or
diminish the Issuer's obligations hereunder (including with respect to the
insurance, use or maintenance of the Railcars).
(e) The Issuer may consent to the sublease of any Railcar. Any
permitted sublease entered into pursuant to Section 2.01(j) of the Servicing
Agreement shall be treated as a "Lease" for all purposes hereunder.
Section 11.16. Notice of Defaults, Events of Default, Servicer Events of
Termination, Manager Events of Termination and Rapid Amortization Events. Upon
any Issuer's obtaining knowledge of the occurrence of any Default, Event of
Default, Servicer Event of Termination, Manager Event of Termination or Rapid
Amortization Event, or event that, with the passage of time or the giving of
notice, or both, would constitute such an occurrence, such Issuer shall, within
one Business Day of obtaining such knowledge, notify the Indenture Trustee, the
Class A Note Insurer and the Rating Agencies of such occurrence.
Section 11.17. Limitation on Liability of Directors, Officers, or Employees
of the Issuers. The directors, officers, or employees of the Issuers shall not
be under any personal liability to the Indenture Trustee, the Holders, the
Servicer, the Manager, the Class A Note Insurer or any other Person hereunder or
pursuant to any documents delivered hereunder, it being expressly understood
that all such liability is expressly waived and released as a condition of, and
as consideration for, the execution of this Indenture and the issuance of the
Notes, except with respect to liability resulting from such person's fraudulent
or willful misconduct. The Issuers and any director or officer or employee or
agent of any Issuer may rely in good faith on the advice of counsel respecting
any matters arising hereunder.
Section 11.18. Obligations Under Leases. Each Issuer will duly fulfill all
material obligations on its part (as required by any Transaction Document to
which it is a party) to be fulfilled under or in connection with the Leases to
the extent the Lessees under the Leases shall
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continue to make payments therefor and perform thereunder as provided in such
Leases; provided, however, that an adjustment or other modification or amendment
of a Lease pursuant to the Transaction Documents shall not be deemed to be a
violation of this paragraph.
Section 11.19. Maintenance of Interests. Each Issuer will make, execute or
endorse, acknowledge and file or deliver to the Indenture Trustee from time to
time such schedules, confirmatory assignments, conveyances, reports and other
reassurances or instruments and take such further steps relating to the Leases,
Railcars and other Railcar Assets and the rights covered by this Indenture as
are necessary to maintain the Indenture Trustee's interests in the Collateral,
and as the Indenture Trustee or the Class A Note Insurer may reasonably request.
Section 11.20. [RESERVED].
Section 11.21. [RESERVED].
Section 11.22. UMLER Designations. Immediately following the Closing Date,
except with respect to the reporting marks which are the subject of the Car Xxxx
Agreement, each Issuer covenants to take all or cause its Affiliates to take all
necessary action to change the UMLER designation associated with the reporting
marks relating to the Railcars so as to reflect such Issuer's ownership of said
marks immediately following Closing Date.
Section 11.23. Post-Closing Records. On the Closing Date, each Issuer shall
cause its records to be marked to reflect the transfer of the Railcar Assets
thereon. To the extent not already done, on the Closing Date, each Issuer shall
deliver each Lease File for each Railcar Asset to the Servicer together will all
maintenance records related to the Railcar Assets.
Section 11.24. [RESERVED].
Section 11.25. Notification of Breaches. Each Issuer will promptly notify
the Indenture Trustee and the Class A Note Insurer promptly following any breach
by such Issuer of any of its representations, warranties, covenants and
agreements contained herein.
Section 11.26. Non-Consolidation. Each Issuer will take all actions
necessary to ensure that the representations and warranties contained in Section
10.01(p) hereof remain true and correct at all times and that each Issuer would
not be consolidated with any of the Sellers, the Manager, the Servicer, The
Xxxxxxxx'x or any of their Affiliates in the event that any such entity shall
become subject to bankruptcy or insolvency proceedings.
Section 11.27. Collections Received. Each Issuer shall hold in trust for
the benefit of the Indenture Trustee and the other Secured Parties, and shall
remit (or cause to be remitted) daily to the relevant Collection Account, all
Collections within one Business Day after receipt thereof by each Issuer or any
of its Affiliates.
Section 11.28. Sale Treatment. No Issuer shall (a) account for (including
for accounting and tax purposes), or otherwise treat, the transactions
contemplated by the Asset Purchase Agreement or any Sale Agreement, as
applicable, in any manner other than as a sale by the
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Railcar Entities of its right, title and interest in, to and under the Railcar
Assets to the Seller, or as a sale by the Seller of its right, title and
interest in, to and under the Railcar Assets to the Issuers, as the case may be,
or (b) account for or otherwise treat the transactions contemplated by this
Indenture in any manner other than as a pledge of the Collateral by each Issuer
to the Indenture Trustee on behalf of the other Secured Parties. In addition,
each Issuer shall disclose (in a footnote or otherwise) in all of its financial
statements (including any such financial statements consolidated with any other
Person's financial statements) the existence and nature of the transactions
contemplated by the Asset Purchase Agreement, the Sale Agreement to which such
Issuer is a party and this Indenture and the ownership interest of the Issuers
and the security interest of the Indenture Trustee, on behalf of the Secured
Parties, in the Railcar Assets.
Section 11.29. [RESERVED].
Section 11.30. Ownership Interest. Each Issuer shall, at its own expense,
take all action necessary or desirable to establish and maintain a valid and
enforceable ownership interest in or, solely to the extent that the Sale
Agreement to which such Issuer is a party does not effect a true sale of the
Railcar Assets from the relevant Seller to such Issuer, a valid and enforceable
security interest in, the Non-Mexican Collateral and a first priority perfected
security interest in the relevant Non-Mexican Collateral to the extent a valid
and enforceable ownership interest was not established and maintained in favor
of such Issuer, in each case free and clear of any Lien (other than any
Permitted Lien), in favor of each Issuer, including taking such action to
perfect, protect or more fully evidence the interest of each Issuer, as the
Indenture Trustee or the Class A Note Insurer may reasonably request. If any
Issuer fails to take any action required to establish, protect, or maintain the
rights thereof, the Indenture Trustee may (with the prior written consent of the
Controlling Party) or shall, at the written direction of the Controlling Party,
perform the same and all of the expenses of the Indenture Trustee shall be
payable by the Issuers. In addition, each Issuer shall xxxx its master data
processing records and other documents describing the conveyances contemplated
by this Indenture and the other Transaction Documents.
Section 11.31. [RESERVED].
Section 11.32. No Change in Payment Instructions to Lessees. No Issuer
shall make any change in its instructions to Lessees regarding payments to be
made in respect of the Railcar Assets, unless (i) such instructions are to
deposit such payments to the relevant Collection Account (or to a post office
box or a lock-box covered by a Lockbox Agreement) or (ii) each of the Indenture
Trustee and the Controlling Party shall have provided their prior written
consent to such addition, termination or change at least 15 days prior thereto.
Section 11.33. No Deposits to Lockbox Accounts or Collection Accounts.
Except as expressly contemplated by this Indenture, no Issuer shall deposit or
otherwise credit, or cause or permit to be so deposited or credited, to any
Lockbox Account or either Collection Account, cash or cash proceeds other than
Collections. No Issuer shall deposit or otherwise credit, or cause or permit to
be so deposited or credited, any Collections to any account or post office boxes
or lock-boxes other than a Lockbox Account, either Collection Account or to post
office boxes or lock-boxes to which only the Lockbox Bank has access.
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Section 11.34. No Change in Name, Identity or Organizational Documents. No
Issuer shall change its name, identity or structure (including a merger or
consolidation), its form of organization or its jurisdiction of incorporation,
unless at least thirty days prior to the effective date of any such change, each
Issuer delivers to the Indenture Trustee and the Class A Note Insurer such
documents, instruments or agreements, executed by such Issuer as are necessary
to reflect such change and to continue the perfection and priority of the
Indenture Trustee's security interests in the Collateral.
Section 11.35. No Amendment to Transaction Documents. Except to the extent
otherwise permitted under Article IX, no Issuer shall amend, modify, or
supplement any Transaction Document or waive any provision thereof, except in
any case with the prior written consent of each of the Indenture Trustee and the
Controlling Party; nor shall any Issuer take, or permit any other Person to
take, any other action under any Transaction Document that could have a Material
Adverse Effect or which is inconsistent with the terms of this Indenture or any
other Transaction Document.
Section 11.36. Compliance with Laws, etc. Each Issuer shall comply with all
applicable Laws applicable to such Issuer or any of its business, properties or
assets, the failure to comply with which could reasonably be expected to cause a
Material Adverse Effect, such compliance to include (i) paying when due all
Taxes imposed upon it or upon its property by any Governmental Entity except to
the extent contested in good faith and for which such Issuer maintains
appropriate cash reserves in accordance with GAAP and (ii) complying with the
rules of the United States Department of Transportation (including the rules and
regulations of the FRA), the Environmental Protection Agency, the STB and the
AAR (including the Interchange Rules) with respect to the ownership, use,
operation and maintenance of each Unit.
Section 11.37. Authorizations, Approvals and Recordations. Each Issuer
shall promptly take, and maintain the effectiveness of, all action that may,
from time to time, be necessary or appropriate under applicable Law in
connection with the performance by such Issuer of its obligations under this
Indenture, any other Transaction Document or any Lease, or the taking of any
action hereby or thereby contemplated, or necessary for the legality, validity,
binding effect or enforceability of this Indenture, any other Transaction
Document or any Lease, or for the making of any payment or the transfer or
remittance of any funds by such Issuer under this Indenture or any other
Transaction Document.
Section 11.38. Reporting Requirements. Each Issuer shall furnish, or caused
to be furnished, as the case may be, to the Indenture Trustee and the Class A
Note Insurer:
(a) as soon as available and in any event within 120 days
after the end of each fiscal year of such Issuer, the Financial
Statements of such Issuer as of the end of such fiscal year, examined
by independent certified public accountants of recognized national
standing whose opinion shall not be qualified as to the scope of audit;
(b) as soon as available and in any event within 60 days
after the end of each financial quarter of such Issuer, a copy of its
internally prepared Financial Statements for such quarter;
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(c) if so requested by the Class A Note Insurer, promptly
after such request (or if later after receipt thereof from the
applicable Lessee), all material information in relation to the
financial status of each Lessee, including Financial Statements of each
Lessee, which is in the possession of each Issuer, the Manager or the
Servicer, is publicly available or is required to be delivered pursuant
to the terms of the applicable Lease;
(d) promptly upon receipt from each Issuer's insurance
carrier or broker, give to the Indenture Trustee and the Class A Note
Insurer copies of any notice, communication, document or agreement
related to the Collateral;
(e) prompt written notice of (i) any threatened or
pending investigation of such Issuer, the Manager, the Servicer, the
Seller or any of their Affiliates by any Governmental Authority or
agency, or (ii) any threatened or pending court or administrative
Proceeding or the institution of any litigation, arbitration proceeding
or other Proceeding, in any case, which individually or in the
aggregate involves the possibility of materially and adversely
affecting the Collateral (including, without limitation, the value of
the Collateral or the Indenture Trustee's first priority perfected
security interest in the Collateral) or the business or conditions
(financial or otherwise) of or would otherwise constitute a Material
Adverse Effect with respect to any Issuer, the Manager, the Servicer,
the Seller or any of their Affiliates, in each case, specifying the
nature of such investigation or proceeding and, if known, what action
the affected Person is taking or proposes to take with respect thereto
and evaluating its merits;
(f) any reports filed by any Issuer, the Servicer or the
Manager with the Securities and Exchange Commission or any Rating
Agency; and
(g) such other information regarding the condition or
operations, financial or otherwise, of each Issuer or the Collateral as
the Indenture Trustee or the Class A Note Insurer may from time to time
reasonably request.
Section 11.39. Audit and Inspection Rights. Each Issuer shall allow any
Person acting on behalf of the Indenture Trustee or the Class A Note Insurer (a)
to visit and inspect any of the properties or assets of such Issuer in
whomever's possession (provided that, in the case of any Railcar then subject to
a Lease, such action is taken in accordance with the terms of such Lease) and to
examine such Issuer's books of record and accounts (and make copies of and
abstracts from all such books of record and accounts) and to discuss such
Issuer's affairs, finances and accounts with the Manager, the Servicer, its and
their officers and independent accountants, all at such times during normal
business hours and as often as the Indenture Trustee or the Class A Note Insurer
may reasonably request, and (b) at any time and from time to time and without
notice, to access and retrieve information from the computer networks on which
such Issuer, the Manager and the Servicer maintain data on the portfolio of
Railcars. Any expense incident to the exercise by the Class A Note Insurer or
the Indenture Trustee of any right under this Section 11.39 shall be borne by
the Initial Manager, except that only the first examination in any year by the
Class A Note Insurer or the Indenture Trustee will be at the Initial Manager's
expense (unless there has occurred and is continuing a Manager Event of
Termination, a Servicer Event of Termination (if the Manager is also the
Servicer), an Event of Default or a Rapid
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Amortization Event (or any event which, with the giving of notice or passage of
time, would constitute any such event), in each of which cases each such
examination shall be at the expense of the Manager)), or, if a Successor Manager
other than an Affiliate of the Initial Manager is then acting as Manager, such
expense shall be borne by the party exercising such right of inspection;
provided, however, that in no event shall the Class A Note Insurer or the
Indenture Trustee be entitled to any expenses hereunder for which it has been
previously reimbursed pursuant to Section 8.06 of either the Management
Agreement or Servicing Agreement.
Section 11.40. Payment of Charges. Each Issuer shall duly pay and discharge
(a) all of its trade bills before the time that any Lien attaches, (b) all Taxes
imposed upon or against it or its property or assets, or upon any property
leased by it, prior to the date on which penalties attach thereto, and (c) all
lawful claims or other obligations, whether for labor, materials, supplies,
services or anything else, which might or could, if unpaid, become a Lien upon
such property or assets, unless and only to the extent that the validity thereof
is being contested in good faith by appropriate proceedings so long as such
proceedings do not involve any material danger of the sale, forfeiture or loss
of any of the Collateral or any interest therein and such Issuer maintains
appropriate cash reserves with respect thereto in accordance with GAAP. The
Issuers shall cooperate to comply with all tax return requirements for such
Taxes, and shall provide such documentation and take such other actions as may
be reasonably necessary to minimize the amount of any such Taxes.
Section 11.41. Maintenance of Records. Each Issuer shall keep, or, with
respect to the Railcars and other Railcar Assets, cause the Manager or the
Servicer to keep, at all times separate books of record and account in which
full, true and correct entries will be made of all dealings or transactions in
relation to its business and affairs, such entries to be made in accordance with
GAAP consistently applied in the case of financial transactions, and each Issuer
will provide or cause to be provided adequate protection against loss or damage
to such books of record and account.
Section 11.42. Post-Acquisition Matters. Each Issuer shall provide to the
Indenture Trustee and the Class A Note Insurer, no later than 30 days following
the Closing Date or the Prefunded Railcar Acquisition Date, as applicable, with
respect to the Railcars so acquired on such date, (a) evidence that all
documents necessary to create a first priority security interest in the Railcars
(other than Mexican Railcars) have been recorded in all relevant jurisdictions,
and (b) an original counterpart of each acknowledgment of the applicable Lessee
of, or consent by the applicable Lessee to, the assignment and assumption to the
relevant Issuer to the extent such acknowledgment or consent is required by the
terms of such Lease. Each Issuer shall cause the relevant Seller to notify each
Lessee under a Lease acquired on such date of the purchase and assignment of the
Railcars and the Lease to such Issuer and irrevocably notify such Lessees of the
collateral assignment of such Leases to the Indenture Trustee (and that all
payments thereunder shall thereafter be made to the relevant Lockbox Account
unless otherwise notified by the Indenture Trustee).
Section 11.43. Use and Maintenance of Railcar Assets. (a) Each Issuer
shall, and shall require and use its best efforts to cause, each Person in
possession of any of the Railcar Assets to, use the Railcar Assets only in the
manner for which they were designed and intended and so as to
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subject it only to ordinary wear and tear. The Railcar Assets shall not be used
in any manner which is in violation of applicable Law or the insurance
maintained under Section 11.14.
(b) Each Issuer shall maintain, service and repair each Railcar or
shall cause each Railcar to be maintained, serviced and repaired (in either
case, subject to scheduling in the ordinary course of business), so that each
Railcar and the component parts thereof (i) are in as good order and repair as
when initially subjected to the Lien of this Indenture, ordinary wear and tear
excepted, (ii) are in compliance with all applicable Laws governing the use and
maintenance thereof, (iii) are in compliance with the requirements of any
insurance policies required pursuant to Section 11.14, and (iv) are in material
compliance with manufacturer's maintenance recommendations and eligible under
manufacturer's warranties. Without limiting the foregoing, each Issuer shall
maintain and keep the Railcar Assets (or shall cause the Railcar Assets to be
maintained and kept) suitable for the commercial use as originally designed and
intended in interchange service, in accordance with applicable Interchange Rules
and prudent industry practice. Each Issuer shall also maintain or cause to be
maintained all records, logs and other materials required by the AAR, the
Department of Transportation and any other Governmental Entity having
jurisdiction over the Railcar Assets or each Issuer to be maintained in respect
of the Railcar Assets.
(c) (i) No Issuer shall at any time use, assign or permit the
assignment of, or permit any person in possession of a Railcar (whether or not a
permitted Lessee) to use, assign or permit the assignment of, any Railcar for
use in service (including the regular operation or maintenance thereof) outside
the continental United States, Canada and Mexico; (ii) no Railcars shall be
stored (other than temporary storage) in Mexico and (iii) not more than 450 of
the Railcars may be leased to Lessees for which a Mexican address is referenced
on the Lease without the consent of the Controlling Party.
Section 11.44. Tort Claims. Upon any Issuer obtaining knowledge of the
existence of any tort claim in excess of $100,000 or, after the occurrence and
during the continuance of any Event of Default if so requested by the Indenture
Trustee or the Class A Note Insurer, any Tort Claim (each, an "Additional Tort
Claim"), each Issuer shall promptly advise the Indenture Trustee and the Class A
Note Insurer in writing and take such actions as are reasonably requested by the
Indenture Trustee or the Class A Note Insurer to grant security interests in
such Additional Tort Claims to the Indenture Trustee, for the benefit of the
Secured Parties, and each Issuer's authorization to file, or to amend, such
financing statements as the Indenture Trustee may deem necessary or advisable to
perfect its security interest in such Additional Tort Claim, it being understood
and agreed that any tort claim constituting Proceeds of Collateral shall, as
Proceeds, be subject to the Lien of this Indenture without any action taken on
the part of any Issuer (and no Issuer shall be obligated to take any such action
with respect to such tort claims unless and until requested to do so by the
Indenture Trustee or the Class A Note Insurer).
Section 11.45. Identification. Each Issuer will cause the placement of
reporting marks or such other marks, legends, or placards on the Railcars as
shall be appropriate or necessary to comply with any regulation imposed by the
STB, the AAR or any equivalent authority. Immediately following the Closing
Date, except with respect to the reporting marks which are the subject of the
Car Marks Agreement or the GNRR Agreement, each Issuer covenants to take
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all, or cause its Affiliates to take all, necessary action to change the UMLER
designation associated with the reporting marks relating to the Railcars so as
to reflect such Issuer's ownership of said marks immediately following the
Closing Date. The Issuer will cause each Railcar owned by such Issuer to be kept
numbered with the road number serial number as shall be set forth on the Lease
and Railcar Schedule. Except as otherwise contemplated in the Car Marks
Agreement or the GNRR Agreement, no Issuer shall allow the name of any other
Person, other than the related Issuer, to be placed on any Railcar as a
designation that might be identified as a claim of any interest therein;
provided, however, that nothing herein contained shall prohibit any Issuer or
its permitted lessees from placing its name, trademarks, initials, customary
colors and other insignia on any Railcar or from naming each Railcar. No Issuer
shall change the identification number of any Railcar unless and until a
statement of a new number or numbers to be substituted therefor shall have been
delivered to the Indenture Trustee and the Class A Note Insurer and filed,
recorded and deposited by each Issuer in all appropriate public offices,
including the public offices where this Indenture shall have been filed,
recorded and deposited.
Section 11.46. No Amendment to Any Lease. No Issuer shall amend, modify,
consent to any change in the terms or otherwise alter any Lease, except as
expressly permitted hereunder and under the Management Agreement or the
Servicing Agreement.
Section 11.47. Transfer of Railcars Among Issuers. With the consent of the
Controlling Party, upon satisfaction of the Rating Agency Condition, an Issuer
may transfer or lease one or more Railcars and any related Railcar Assets (or
interests therein) to another Issuer upon such terms as may be agreed upon by
the Controlling Party, the relevant Issuers, the Manager, the Servicer and the
Indenture Trustee.
ARTICLE XII
ACCOUNTS AND ACCOUNTINGS
Section 12.01. Collection of Money. Except as otherwise expressly provided
herein, the Indenture Trustee may demand payment or delivery of, and shall
receive and collect, directly and without intervention or assistance of any
fiscal agent or other intermediary, all money and other property payable to, or
receivable by, the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall, (a) on or prior to the third Business Day following each
Accounting Date (i) provide the Servicer and the Class A Note Insurer with a
written statement or electronic access to account information setting forth (A)
the amount of funds on deposit in the Collection Accounts as of such Accounting
Date and (B) the amount of funds on deposit in the Cash Collateral Accounts as
of such Accounting Date and (ii) provide the Servicer, the Manager and the Class
A Note Insurer with a written statement or electronic access to account
information setting forth the amount of funds on deposit in the Operating
Expense Reserve Account (including the NARCAT OER Subaccount and the CARCAT OER
Subaccount) and the Prefunding Account as of such Accounting Date and (b) upon
request from the Servicer or the Manager, promptly provide the Servicer and/or
the Manager with any additional information necessary to permit the Servicer and
the Manager to perform their respective duties under the Servicing Agreement and
the Management Agreement. The Indenture Trustee shall hold all such money and
property so received by it as Collateral and shall apply it as provided in this
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Indenture. If any Lease becomes a Defaulted Lease, the Indenture Trustee, upon
the request of the Issuers or the Servicer may, and upon the request of the
Controlling Party shall, take such action as may be appropriate to enforce such
payment or performance, including the institution and prosecution of appropriate
Proceedings. Any such action shall be without prejudice to any right to claim a
Default or Event of Default under this Indenture and to proceed thereafter as
provided in Article VI.
Section 12.02. Collection Accounts. (a) The Indenture Trustee represents
and warrants that it has established two separate Collection Accounts, the
NARCAT Collection Account and the CARCAT Collection Account, as segregated trust
accounts at its Corporate Trust Office. The NARCAT Collection Account was
established in the name of NARCAT and NARCAT Mexico, for the benefit of the
Indenture Trustee on behalf of the Holders and the Class A Note Insurer, and the
CARCAT Collection Account was established in the name of CARCAT, for the benefit
of the Indenture Trustee on behalf of the Holders and the Class A Note Insurer.
All payments to be made from time to time by the Issuers to the Holders out of
funds in the Collection Accounts pursuant to this Indenture shall be made by the
Indenture Trustee pursuant to the written direction of the Servicer (or, to the
extent not available on a timely basis or if the Controlling Party has notified
the Indenture Trustee that such direction is incorrect, instructions given by
the Controlling Party). All monies deposited from time to time in the Collection
Accounts pursuant to this Indenture shall be held by the Indenture Trustee as
Collateral as herein provided. Deposits to the Collection Accounts shall be as
follows:
(i) The Indenture Trustee shall deposit, pursuant to the
written direction of the Servicer (or, to the extent not available on a
timely basis or if the Controlling Party has notified the Indenture
Trustee that such direction is incorrect, instructions given by the
Controlling Party) to the NARCAT Collection Account (upon receipt,
except as otherwise indicated): (i) all Collections received by the
Indenture Trustee, whether from the Servicer, the Manager, the Issuers
and through transfers pursuant to the lockbox arrangements set forth in
the Servicing Agreement and Lockbox Agreements, or otherwise, in
respect of Railcars owned by NARCAT or NARCAT Mexico and any Leases
thereof; (ii) all earnings on the NARCAT Collection Account, the NARCAT
OER Subaccount and the Prefunding Account; (iii) any monies required to
be transferred from the NARCAT Cash Collateral Account or the
Prefunding Account to the NARCAT Collection Account; (iv) any
indemnification amounts paid by any Railcar Entity under the Asset
Purchase Agreement, or by any guarantor thereof in respect of Railcars
owned by NARCAT or NARCAT Mexico and any Leases thereof; (v) any monies
required to be transferred to the NARCAT Collection Account from the
Policy Payment Account.
(ii) The Indenture Trustee shall deposit, pursuant to the
written direction of the Servicer (or, to the extent not available on a
timely basis or if the Controlling Party has notified the Indenture
Trustee that such direction is incorrect, instructions given by the
Controlling Party) to the CARCAT Collection Account (upon receipt,
except as otherwise indicated): (i) all Collections received by the
Indenture Trustee, whether from the Servicer, the Manager, the Issuers
and through transfers pursuant to the lockbox arrangements set forth in
the Servicing Agreement and Lockbox Agreements, or otherwise, in
respect of Railcars owned by CARCAT and any Leases thereof; (ii) all
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earnings on the CARCAT Collection Account and the CARCAT OER
Subaccount; (iii) any monies required to be transferred from the CARCAT
Cash Collateral Account to the CARCAT Collection Account; (iv) any
indemnification amounts paid by any Railcar Entity under the Asset
Purchase Agreement, or by any guarantor thereof in respect of Railcars
owned by CARCAT and any Leases thereof; and (v) any monies required to
be transferred to the CARCAT Collection Account from the Policy Payment
Account.
(b) Upon an Issuer Order of NARCAT, with respect to the NARCAT
Collection Account, and CARCAT, with respect to the CARCAT Collection Account,
the Indenture Trustee shall invest the funds in the Collection Accounts in
Eligible Investments. The Issuer Orders shall specify the Eligible Investments
in which the Indenture Trustee shall invest, shall state that the same are
Eligible Investments and shall further specify the percentage of funds to be
invested in each Eligible Investment. No such Eligible Investment shall mature
later than the Business Day preceding the next following Payment Date and shall
not be sold or disposed of prior to its maturity. In the absence of an Issuer
Order, the Indenture Trustee shall invest funds in the Collection Accounts in
Eligible Investments described in clause (f) of the definition thereof. Eligible
Investments shall be made in the name of the Indenture Trustee for the benefit
of the Holders and the Class A Note Insurer.
(c) Any income or other gain from investments in Eligible
Investments as outlined in (b) above shall be credited to the applicable
Collection Account and any loss resulting from such investments shall be charged
to such account. Except as otherwise specifically set forth herein or as a
result of its negligence or misconduct, the Indenture Trustee shall not be
liable for any loss incurred on any funds invested in Eligible Investments
pursuant to the provisions of this Section 12.02 (other than in its capacity as
obligor under any Eligible Investment).
(d) On each Payment Date, unless the entire unpaid principal
amount of the Notes shall have become due and payable pursuant to Section 6.02,
then on such Payment Date, the Indenture Trustee, after giving effect to the
Source of Funds Requirements and any transfers made pursuant to the Funds
Transfer Agreement, shall withdraw from Available Funds on deposit in the
Collection Accounts and shall make the following disbursements in the following
order (it being understood that if the Notes have been accelerated pursuant to
Section 6.02, then the Available Funds shall be distributed in accordance with
Section 6.08); provided, however, that any Class A Note Insurer Optional
Deposits shall be applied as directed by the Class A Note Insurer:
(i) to the Tax Payment Recipients, any Tax Payment Amounts
then due and owing by any Issuer;
(ii) to the Indenture Trustee, the Backup Manager and the
Backup Servicer, pari passu, the Trustee Fee, the Backup Manager Fee
and the Backup Servicer Fee, respectively;
(iii) to the Lessees entitled thereto, any Railroad Mileage
Credits to which they are entitled under the Leases;
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(iv) to the Class A Note Insurer and the Indenture
Trustee, pari passu, all out-of-pocket expenses incurred in connection
with the transition to a successor Manager; provided, however, that the
aggregate amount payable under this clause, together with any
corresponding payments paid in accordance with Section 6.08 with
respect to any one such transition shall not exceed $200,000;
(v) to the Manager, the Manager Fee;
(vi) to the Manager for reimbursement for Operating
Expenses made by the Manager in excess of amounts available therefor
which are held in the Operating Expense Reserve Account; provided,
however, that the aggregate amount payable on any Payment Date pursuant
to this clause, together with any corresponding payments paid in
accordance with Section 6.08, shall not exceed the Capped Manager
Reimbursement;
(vii) to the Class A Note Insurer and the Indenture
Trustee, pari passu, all out-of-pocket expenses incurred in connection
with the transition to a successor Servicer; provided, however, that
the aggregate amount payable under this clause, together with any
corresponding payments paid in accordance with Section 6.08, with
respect to any one such transition shall not exceed $100,000;
(viii) to the Servicer, the Servicer Fee;
(ix) to the Indenture Trustee, for deposit in the
Operating Expense Reserve Account, the applicable Operating Expense
Deposit Amounts for the CARCAT OER Subaccount and the NARCAT OER
Subaccount, subject to the provisions of Section 12.04(a);
(x) to the Holders of the Class A Notes, pari passu, an
amount equal to the Class A Note Interest; provided, however, that,
notwithstanding the foregoing, the Class A Note Insurer shall be
entitled to receive, to the extent of Available Funds, all Incremental
Class A Interest and all Class A Overdue Interest to the extent of any
interest payments made by the Class A Note Insurer under, and in
compliance with, the Class A Note Policy and interest thereon accruing
at the Overdue Rate;
(xi) to the Class A Note Insurer, accrued Premium due with
respect to the Class A Note Policy, reimbursement of any claims under
the Class A Note Policy with respect to draws to pay Class A Note
Interest, including any Class A Overdue Interest owed with respect
thereto, any Incremental Class A Interest and, in an amount not to
exceed $50,000 in any calendar year, any other fees, expenses and
indemnities owing to the Class A Note Insurer, together in each case
with any interest thereon;
(xii) to the Indenture Trustee, for deposit to the NARCAT
Cash Collateral Account and the CARCAT Cash Collateral Amount, pari
passu, such amounts necessary to cause the amounts held therein to
equal the Required NARCAT Cash Collateral Amount and the Required
CARCAT Cash Collateral Amount, respectively;
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(xiii) on the May 2004 Payment Date, and on each Payment
Date thereafter, to the payment of the Basic Principal Payment in the
following order of priority:
(A) to the Holders of the Class A-1 Notes, pari
passu, until the Note Principal Balance of the Class A-1 Notes
has been reduced to zero;
(B) to the Holders of the Class A-2 Notes, pari
passu, until the Note Principal Balance of the Class A-2 Notes
has been reduced to zero; and
(C) to the Holders of the Class A-3 Notes, pari
passu, until the Note Principal Balance of the Class A-3 Notes
has been reduced to zero;
(xiv) to the payment of the Supplemental Principal Payment
in the following order or priority:
(A) in the case of any Regular Supplemental
Principal Payment:
(I) to the Holders of the Class A-3
Notes, pari passu, until the Note Principal Balance
of the Class A-3 Notes has been reduced to zero;
(II) to the Holders of the Class A-2
Notes, pari passu, until the Note Principal Balance
of the Class A-2 Notes has been reduced to zero; and
(III) to the Holders of the Class A-1
Notes, pari passu, until the Note Principal Balance
of the Class A-1 Notes has been reduced to zero; and
(B) if a Rapid Amortization Event exists, in the
case of any Supplemental Principal Payment after payment of
the Regular Supplemental Principal Payments:
(I) to the Holders of the Class A-3
Notes, pari passu, in an amount equal to the lesser
of (x) the remaining principal balance of the Class
A-3 Notes and (y) the amount of Available Funds then
on deposit in the CARCAT Collection Account (without
giving effect to any deposit of funds in the CARCAT
Collection Account pursuant to the Funds Transfer
Agreement in respect of this subclause (B));
(II) to the Holders of the Class A-2
Notes, pari passu, in an amount equal to the lesser
of (x) the remaining principal balance of the Class
A-2 Notes and (y) the sum of (i) the amount of
Available Funds then on deposit in the NARCAT
Collection Account and (ii) any remaining amount of
Available Funds remaining on deposit in the CARCAT
Collection Account after giving effect to the
distributions under the preceding subclause (B)(I);
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(III) to the Holders of the Class A-1
Notes, pari passu, in an amount equal to the lesser
of (x) the remaining principal balance of the Class
A-1 Notes and (y) the aggregate amount of Available
Funds remaining on deposit in the NARCAT Collection
Account and the CARCAT Collection Account after
giving effect to the distributions under the
preceding subclauses (B)(I) and (II); and
(IV) to the Holders of the Class A-3
Notes, pari passu, in an amount equal to the lesser
of (x) the remaining principal balance of the Class
A-3 Notes and (y) the aggregate amount of Available
Funds remaining on deposit in the NARCAT Collection
Account after giving effect to the distributions
under the preceding subclauses (B)(II) and (III);
(xv) to the extent not previously paid, the Class A Note
Insurer, the amount of any unreimbursed claims paid by the Class A Note
Insurer under the Class A Note Policy with respect to principal on the
Class A Notes, and any fees, expenses and indemnities owing to the
Class A Note Insurer, together in each case with any interest owed
thereon;
(xvi) to the Holders of the Class B Notes, pari passu, an
amount equal to the accrued but unpaid Class B Note Interest;
(xvii) to the Holders of the Class B Notes, pari passu, in
the following order of priority, until the Note Principal Balance of
the Class B Notes has been reduced to zero:
(A) the Scheduled Class B Payment;
(B) on the Payment Date on which the Note
Principal Balance of the Class A Notes is reduced to zero, any
portion of the Basic Principal Payment for such Payment Date
not paid to the Holders of the Class A Notes; and
(C) on each Payment Date thereafter, the Basic
Principal Payment;
(xviii) to the Holders of the Class B Notes, pari passu, (i)
on the Payment Date on which the Note Principal Balance of the Class A
Notes is reduced to zero, any portion of the Supplemental Principal
Payment not paid to the Holders of the Class A Notes, and (ii) on each
Payment Date thereafter, the Supplemental Principal Payment, until the
Note Principal Balance of the Class B Notes has been reduced to zero;
(xix) to the Indenture Trustee, the Backup Manager, the
Backup Servicer and the Class A Note Insurer, pari passu, any fees,
expenses and indemnities owing thereto but not previously paid;
(xx) to the Manager, any expenses, indemnities and
reimbursement payments owing thereto but not previously paid;
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(xxi) to the Servicer, any expenses, indemnities and
reimbursement payments owing thereto but not previously paid;
(xxii) to the Manager, the Supplemental Manager Fee; and
(xxiii) to the Issuers.
Notwithstanding any other provision of this Indenture, funds paid to
the Issuers pursuant to clause (xxiii) above automatically shall be released
from the Lien of the Indenture.
In making the withdrawals and payments required by this Section
12.02(d), and in making the reports and accounting referred to in Section 12.10,
the Indenture Trustee shall act in accordance with the Monthly Servicer Report,
and shall be fully protected in relying thereon, unless (x) a Responsible
Officer has actual knowledge to the contrary or the Controlling Party has
notified the Indenture Trustee that a Servicer Event of Termination has occurred
and is continuing and has given instructions contrary to those contained in the
Monthly Servicer Report, or (y) no Monthly Servicing Report has been delivered
or the Controlling Party has instructed the Indenture Trustee that the Monthly
Servicer Report is incorrect, in which case the Indenture Trustee shall rely
upon the written instructions of the Controlling Party, and shall be fully
protected in relying thereon.
(e) In addition, at the direction of the Servicer, and irrespective of
whether a Default or Event of Default shall have occurred and be continuing
(except a Servicer Event of Termination, in which case at the direction of the
Controlling Party unless otherwise directed by the Controlling Party), the
Indenture Trustee shall withdraw from the Collection Accounts and remit to the
Servicer for delivery to the Person(s) entitled thereto prior to any
distributions made in accordance with Section 12.02(d) or Section 6.08 on any
Payment Date: (i) amounts other than Collections received from Lessees or other
parties with respect to the Leases or the Railcars, (ii) amounts received in
respect of Leases and Railcars due on of before (A) the Closing Date, with
respect to Initial Existing Leases, (B) the Prefunded Railcar Acquisition Date,
with respect to Prefunded Existing Leases or (C) the date transferred to any
Issuer, with respect to Subsequent Leases transferred to any Issuer, (iii)
amounts received in respect of Leases and Railcars following the purchase
thereof by the Manager pursuant to the Management Agreement or the Servicer
pursuant to the Servicing Agreement or the sale thereof as contemplated in
Section 8.02 and (iv) indemnification amounts to be remitted to the Initial
Manager pursuant to Section 4.04(f) of the Management Agreement; provided,
however, that no withdrawal or remittance shall be made pursuant to this Section
12.02(e) at any time during which a Default or Event of Default shall have
occurred and be continuing unless the Servicer shall have provided to the
Controlling Party not less than five Business Days' notice thereof.
(f) With respect to the distributions to be made pursuant to Section
12.02(d) above or Section 6.08(a) (unless otherwise directed by the Controlling
Party after an acceleration of the Notes following an Event of Default), the
term "Source of Funds Requirements" shall mean, as of any Payment Date, the
following:
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(i) any Tax Payment Amounts to be disbursed pursuant to
Section 12.02(d)(i) or Section 6.08(a)(i) shall be withdrawn by the
Paying Agent from the NARCAT Collection Account to the extent that such
Tax Payment Amounts shall be due and owing by NARCAT or NARCAT Mexico
(or owed by Holdco with respect to the activities of such entities),
and from the CARCAT Collection Account to the extent that such Tax
Payment Amounts shall be due and owing by CARCAT (or owed by Holdco
with respect to the activities of such entity);
(ii) any amounts to be disbursed pursuant to Sections
12.02(d)(ii), (vii), (viii), (xv), (xix), (xxi) and (xxii) or Sections
6.08(a)(ii), (vii), (viii), (xiv), (xvii), (xix) and (xx) shall be
withdrawn by the Paying Agent from the NARCAT Collection Account and
the CARCAT Collection Account, pro rata, based upon the aggregate Note
Principal Balance of the Class A-1 Notes, the Class A-2 Notes and the
Class B Notes, and the aggregate Note Principal Balance of the Class
A-3 Notes, respectively, which shall be Outstanding on such Payment
Date prior to giving effect to any payments of principal to be made on
such Payment Date;
(iii) any amounts to be disbursed pursuant to Section
12.02(d)(iii) or Section 6.08(a)(iii) shall be withdrawn by the Paying
Agent from the NARCAT Collection Account and the CARCAT Collection
Account, pro rata, based upon the aggregate amount of Railroad Mileage
Credits payable on such Payment Date to Lessees under Leases of
Railcars owned by the NARCAT Entities and the aggregate amount of
Railroad Mileage Credits payable on such Payment Date to Lessees under
Leases of Railcars owned by CARCAT, respectively;
(iv) any amounts to be disbursed pursuant to Section
12.02(d)(iv) or Section 6.08(a)(iv) shall be withdrawn by the Paying
Agent from the NARCAT Collection Account and the CARCAT Collection
Account, pro rata, based upon the Stated Values of all Railcars owned
by the NARCAT Entities and CARCAT, respectively, as of the related
Accounting Date;
(v) any amounts to be disbursed pursuant to Section
12.02(d)(v) or Section 6.08(a)(v) shall be withdrawn by the Paying
Agent from the NARCAT Collection Account and the CARCAT Collection
Account, pro rata, based upon the number of Railcars owned by the
NARCAT Entities and CARCAT, respectively, as of the related Accounting
Date;
(vi) any amounts to be disbursed pursuant to Sections
12.02(d)(vi) and (xx) or Sections 6.08(a)(vi) and (xviii) shall be
withdrawn by the Paying Agent from the NARCAT Collection Account and
the CARCAT Collection Account, pro rata, based upon the ownership of
the Railcars in respect of which the subject Operating Expenses or
other expenses, indemnities or reimbursement payments shall relate;
(vii) any amounts to be disbursed pursuant to Section
12.02(d)(ix) or Section 6.08(a)(ix) shall be withdrawn by the Paying
Agent from the NARCAT Collection Account and the CARCAT Collection
Account, pro rata, based upon the
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amount required to be deposited into the Operating Expense Reserve
Account in respect of Railcars owned by the NARCAT Entities and CARCAT,
respectively;
(viii) any amounts to be disbursed pursuant to Section
12.02(d)(x), (xi), (xiii) or (xiv) or Sections 6.08(a)(x), (xi) or
(xiii) in respect of principal, Class A Note Interest, Incremental
Class A Note Interest and Class A Overdue Interest on the Class A-1
Notes or the Class A-2 Notes, and any amounts to be disbursed pursuant
to Sections 12.02(d)(xvi), (xvii) or (xviii) or Sections 6.08(a)(xv) or
(xvi) in respect of principal of the Class B Notes or Class B Note
Interest, shall be withdrawn by the Paying Agent from the NARCAT
Collection Account;
(ix) any amounts to be disbursed pursuant to Section
12.02(d)(x), (xi), (xiii) or (xiv) or Sections 6.08(a)(x), (xi) or
(xiii) in respect of principal, Class A Note Interest, Incremental
Class A Interest and Class A Overdue Interest on the Class A-3 Notes
shall be withdrawn by the Paying Agent from the CARCAT Collection
Account;
(x) any amounts to be disbursed pursuant to Section
12.02(d)(xi) or Section 6.08(a)(xi), in respect of Premium due with
respect to the Class A Note Policy shall be withdrawn by the Paying
Agent from the NARCAT Collection Account;
(xi) any amounts to be disbursed pursuant to Section
12.02(d)(xi) or Section 6.08(a)(xi) in respect of reimbursement of
claims under the Class A Note Policy with respect to draws to pay
interest on the Class A-1 Notes or the Class A-2 Notes (including any
related Class A-1 Overdue Interest and Class A-2 Overdue Interest owed
with respect thereto) shall be withdrawn by the Paying Agent from the
NARCAT Collection Account;
(xii) any amounts to be disbursed pursuant to Section
12.02(d)(xi) or Section 6.08(a)(xi) in respect of reimbursement of
claims under the Class A Note Policy with respect to draws to pay
interest on the Class A-3 Notes (including any related Class A-3
Overdue Interest owed with respect thereto) shall be withdrawn by the
Paying Agent from the CARCAT Collection Account;
(xiii) any amounts to be disbursed pursuant to Section
12.02(d)(xi) or Section 6.08(a)(xi) in respect of payments not
referenced in clauses (x), (xi) or (xii) of this Section 12.02(f) shall
be drawn from the NARCAT Collection Account and the CARCAT Collection
Account, pro rata, based upon the aggregate Note Principal Balance of
the Class A-1 Notes and the Class A-2 Notes, and the aggregate Note
Principal Balance of the Class A-3 Notes, respectively, which shall be
outstanding on such Payment Date prior to giving effect to any payments
of principal to be made on such Payment Date; and
(xiv) any amounts to be disbursed pursuant to Section
12.02(d)(xii) or Section 6.08(a)(xii) shall be withdrawn by the Paying
Agent from the NARCAT Collection Account and the CARCAT Collection
Account, pro rata, based upon the
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amount required to be deposited in the NARCAT Cash Collateral Account
and the CARCAT Cash Collateral Account on such Payment Date.
If the Notes have been accelerated following an Event of Default and
the Controlling Party directs that funds be paid other than in accordance with
the above Source of Funds, then Available Funds may be applied towards the
payment of amounts set forth in Section 6.08(a) in the order of priority set
forth therein without regard to the limitations set forth in this Section
12.02(f).
Section 12.03. Cash Collateral Accounts. (a) On or prior to the Closing
Date, the Issuers shall cause the Indenture Trustee to establish and maintain
two separate Cash Collateral Accounts, the NARCAT Cash Collateral Account and
the CARCAT Cash Collateral Account, as segregated trust accounts at its
Corporate Trust Office. The NARCAT Cash Collateral Account was established in
the name of NARCAT and NARCAT Mexico, and pledged to the Indenture Trustee for
the benefit of the Holders and the Class A Note Insurer, and the CARCAT Cash
Collateral Account was established in the name of CARCAT, and pledged to the
Indenture Trustee for the benefit of the Holders and the Class A Note Insurer.
On the Closing Date, NARCAT and NARCAT Mexico shall deposit, out of the proceeds
of the issuance of the Class A-1 Notes, Class A-2 Notes and the Class B Notes,
the Initial NARCAT Cash Collateral Deposit to the NARCAT Cash Collateral
Account, and CARCAT shall deposit, out of the proceeds of the issuance of the
Class A-3 Notes, the Initial CARCAT Cash Collateral Deposit to the CARCAT Cash
Collateral Account. On each Payment Date thereafter, the NARCAT Cash Collateral
Account shall be funded up to the Required NARCAT Cash Collateral Amount and the
CARCAT Cash Collateral Account shall be funded up to the Required CARCAT Cash
Collateral Amount from amounts available in the NARCAT Collection Account and
the CARCAT Collection Account, respectively, in accordance with Section 12.02(d)
or Section 6.08, as applicable. On each Payment Date based solely upon the
information contained in the Monthly Servicer Report (or, to the extent not
available on a timely basis or if the Controlling Party has notified the
Indenture Trustee that the Monthly Servicer Report is incorrect, instructions
given by the Controlling Party), (a) the Indenture Trustee will transfer funds
from the NARCAT Cash Collateral Account to the NARCAT Collection Account to the
extent necessary to fund any deficiencies in the amounts to be distributed
pursuant to clause (x) of Section 12.02(d) or clause (x) of Section 6.08(a) in
respect of the Class A-1 Notes or the Class A-2 Notes and pursuant to clause
(xi) of Section 12.02(d) or clause (xi) of Section 6.08(a) to pay accrued
Premiums due with respect to the Class A Note Policy, to reimburse the Class A
Note Insurer with respect to claims made under the Class A Note Policy with
respect to draws to pay Class A Note Interest under the Class A-1 Notes and/or
the Class A-2 Notes and a limited amount of other fees, expenses and indemnities
owing to the Class A Note Insurer, and (b) the Indenture Trustee will transfer
funds from the CARCAT Cash Collateral Account to the CARCAT Collection Account
to the extent necessary to fund any deficiencies in the amounts to be
distributed pursuant to clause (x) of Section 12.02(d) or clause (x) of Section
6.08(a) in respect of the Class A-3 Notes and pursuant to clause (xi) of Section
12.02(d) or clause (xi) of Section 6.08(a) to pay accrued Premiums due with
respect to the Class A Note Policy, to reimburse the Class A Note Insurer with
respect to claims made under the Class A Note Policy with respect to draws to
pay Class A Note Interest under the Class A-3 Notes and a limited amount of
other fees, expenses and indemnities owing to the Class A Note Insurer. Amounts
in
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the Cash Collateral Accounts shall be withdrawn solely to pay such amounts and
shall not be available to the Holders or the Indenture Trustee for any other
purpose; provided, however, that on the Stated Legal Maturity Date, all amounts
on deposit in the NARCAT Cash Collateral Account will be deposited in the NARCAT
Collection Account and all amounts on deposit in the CARCAT Cash Collateral
Account will be deposited in the CARCAT Collection Account.
(b) Upon an Issuer Order of NARCAT, with respect to the NARCAT
Cash Collateral Account, and CARCAT, with respect to the CARCAT Cash Collateral
Account, the Indenture Trustee shall invest the funds in the Cash Collateral
Accounts in Eligible Investments that will mature no later than the Business Day
preceding the next Payment Date. In the absence of an Issuer Order, the
Indenture Trustee shall invest funds in the Cash Collateral Account in Eligible
Investments described in clause (f) of the definition thereof. All income or
other gain from such investments shall be credited to such Cash Collateral
Account and any loss resulting from such investments shall be charged to such
Cash Collateral Account. Eligible Investments shall be made in the name of the
Indenture Trustee for the benefit of the Holders and the Class A Note Insurer.
(c) If any amounts invested as provided in Section 12.03(b) shall
be needed for disbursement from either Cash Collateral Account as set forth in
Section 12.03(a) or (d), the Indenture Trustee shall cause such investments of
such Cash Collateral Account to be sold or otherwise converted to cash to the
credit of such Cash Collateral Account. The Indenture Trustee shall not be
liable for any investment loss resulting from investment of money in the Cash
Collateral Accounts in any Eligible Investment in accordance with the terms
hereof (other than in its capacity as obligor under any Eligible Investment)
except as a result of its negligence or misconduct.
(d) If on any Payment Date the amount in either Cash Collateral
Account, after giving effect to the distributions and withdrawals required
pursuant to this Section 12.03 on the related Payment Date and the deposits into
such account on such Payment Date, is greater than the Required NARCAT Cash
Collateral Amount or Required CARCAT Cash Collateral Amount, as applicable, the
amount of such excess shall be distributed by the Indenture Trustee as Available
Funds in accordance with Section 12.02(d) or Section 6.08, as applicable.
Section 12.04. Operating Expense Reserve Account. (a) On or prior to the
Closing Date, the Issuers shall cause the Indenture Trustee to establish and
maintain a segregated trust account entitled "Railcar Notes Expense Reserve
Account" at its Corporate Trust Office (the "Operating Expense Reserve Account")
for the benefit of the Indenture Trustee on behalf of the Holders and the Class
A Note Insurer. The Operating Expense Reserve Account shall consist of (a) a
segregated subaccount (the "NARCAT OER Subaccount") in the name of NARCAT and
NARCAT Mexico for the benefit of the Indenture Trustee on behalf of the Class A
Note Insurer and the Holders and (b) a segregated subaccount (the "CARCAT OER
Subaccount") in the name of CARCAT for the benefit of the Indenture Trustee on
behalf of the Class A Note Insurer and the Holders. The Operating Expense
Reserve Account will not be funded at closing. On each Payment Date, the
Indenture Trustee shall, in accordance with instructions in the Monthly Servicer
Report (or, to the extent not available on a timely basis or if the Controlling
Party has notified the Indenture Trustee that the Monthly Servicer Report is
incorrect, instructions given by
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the Controlling Party), transfer from (i) the NARCAT Collection Account to the
NARCAT OER Subaccount the lesser of (x) the Operating Expense Deposit Amount
related to each U.S. Railcar and each Mexican Railcar, and (y) an amount
required to cause the balance of such subaccount (after giving effect to all
amounts disbursed therefrom on such Payment Date) to equal $1,300,000 (the
"NARCAT OER Subaccount Required Balance"), and (b) the CARCAT Collection Account
to the CARCAT OER Subaccount the lesser of (x) the Operating Expense Deposit
Amount related to each Canadian Railcar, and (y) an amount required to cause the
balance of such subaccount (after giving effect to all amounts disbursed
therefrom on such Payment Date) to equal $700,000 (the "CARCAT OER Subaccount
Required Balance"). Any such transfers shall be made in accordance with the
Source of Funds Requirements and to the extent of Available Funds remaining
after the payments having a higher priority in Section 6.08 or Section 12.02(d),
as applicable. Funds will be withdrawn from the NARCAT OER Subaccount and the
CARCAT OER Subaccount to make the distributions described in Section 12.04(d)
and shall not be available to the Holders or the Indenture Trustee for any other
purpose; provided, however, that on the Stated Legal Maturity Date, all amounts
on deposit in the NARCAT OER Subaccount will be deposited in the NARCAT
Collection Account and all amounts on deposit in the CARCAT OER Subaccount will
be deposited in the CARCAT Collection Account and paid as Available Funds
pursuant to Section 12.02(d) or Section 6.08, as applicable. Upon release of the
Lien of this Indenture, any amounts remaining on deposit in the NARCAT OER
Subaccount will be returned to NARCAT and NARCAT Mexico in accordance with their
respective interests therein or their designees and all amounts on deposit in
the CARCAT OER Subaccount will be returned to CARCAT or its designees.
(b) Upon an Issuer Order of (i) NARCAT and NARCAT Mexico, in the
case of the NARCAT OER Subaccount, and (b) CARCAT, in the case of the CARCAT OER
Subaccount, all or a portion of the Operating Expense Reserve Account shall be
invested and reinvested at such Issuers' written direction in one or more
Eligible Investments maturing no later than the Business Day prior to any
disbursements made from such account. In the absence of an Issuer Order, the
Indenture Trustee shall invest funds in the Operating Expense Reserve Account in
Eligible Investments described in clause (f) of the definition thereof. Earnings
on amounts on deposit in the (a) NARCAT OER Subaccount shall be retained within
the NARCAT OER Subaccount, except that on any Payment Date, amounts on deposit
in the NARCAT OER Subaccount in excess of the NARCAT OER Subaccount Required
Balance (after all required applications of such amounts on such date) shall be
transferred to the NARCAT Collection Account, and (b) the CARCAT OER Subaccount
shall be retained within the CARCAT OER Subaccount, except that on any Payment
Date, amounts on deposit in the CARCAT OER Subaccount in excess of the CARCAT
OER Subaccount Required Balance (after all required applications of such amounts
on such date) shall be transferred to the CARCAT Collection Account. Any loss
resulting from such investments shall be charged to the applicable subaccount.
Eligible Investments shall be made in the name of the Indenture Trustee for the
benefit of the Holders and the Class A Note Insurer.
(c) If any amounts invested as provided in Section 12.04(b) shall
be needed for disbursement from the NARCAT OER Subaccount or the CARCAT OER
Subaccount as set forth in Section 12.04(a) or (d), the Indenture Trustee shall
cause such investments of the applicable subaccount to be sold or otherwise
converted to cash to the credit of such subaccount.
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The Indenture Trustee shall not be liable for any investment loss resulting from
investment of money in the NARCAT OER Subaccount or the CARCAT OER Subaccount in
any Eligible Investment in accordance with the terms hereof (other than in its
capacity as obligor under any Eligible Investment) except as a result of its
negligence or misconduct.
(d) Disbursements shall be made from the (a) NARCAT OER Subaccount
for any Operating Expense related to the U.S. Railcars or the Mexican Railcars,
or (b) CARCAT OER Subaccount for any Operating Expenses related to the Canadian
Railcars, as applicable, in accordance with the Management Agreement, to
reimburse the Manager for any actual maintenance expenses incurred in connection
with the Railcars and as to which the Manager shall have delivered to the
Indenture Trustee a Maintenance Expense Reimbursement Request pursuant to
Section 2.06(b) of the Management Agreement; provided, however, that such
disbursements shall be made no more frequently than once per week.
Section 12.05. Policy Payment Account. (a) On or prior to the Closing Date,
the Indenture Trustee shall establish a segregated trust account entitled
"Policy Payment Account" at its Corporate Trust Office (the "Policy Payment
Account") in the name of the Indenture Trustee for the benefit of the Holders of
the Class A Notes and the Class A Note Insurer. The Policy Payment Account will
contain two segregated subaccounts, one of which (the "CARCAT Policy Payment
Subaccount") will be maintained exclusively for the benefit of the Indenture
Trustee on behalf of the Holders of the Class A-3 Notes and the Class A Note
Insurer and the other of which (the "NARCAT Policy Payment Subaccount") will be
maintained exclusively for the benefit of the Indenture Trustee on behalf of the
Holders of the Class A-1 Notes, the Class A-2 Notes and the Class A Note
Insurer. Upon receipt of a Policy Claim Amount to be distributed to the Holders
of the Class A Notes from the Class A Note Insurer, the Indenture Trustee shall
deposit the amounts of such Policy Claim Amount related to principal of, or
interest on, (a) the Class A-3 Notes to the CARCAT Policy Payment Subaccount of
the Policy Payment Account and (b) the Class A-1 Notes and the Class A-2 Notes
to the NARCAT Policy Payment Subaccount of the Policy Payment Account. To the
extent the Indenture Trustee or the Payment Agent is uncertain as to the
applicable subaccount to which a deposit of a portion of the Policy Claim Amount
applies, the direction of the Class A Note Insurer shall be conclusive. All
amounts on deposit in the Policy Payment Account shall remain uninvested. On
each Payment Date, the Indenture Trustee shall (i) transfer any Policy Claim
Amount then on deposit in the Policy Payment Account directly to the Holders of
the Class A Notes or other Persons entitled to such amounts and (ii) return to
the Class A Note Insurer any money in the Policy Payment Account which does not
constitute a Policy Claim Amount or an amount paid pursuant to Section 13.02.
Section 12.06. Prefunding Account. (a) On or prior to the Closing Date, the
Indenture Trustee shall establish a segregated trust account entitled "Railcar
Notes Prefunding Account" at its Corporate Trust Office (the "Prefunding
Account") in the name of the Indenture Trustee for the benefit of the Holders
and the Class A Note Insurer. On the Closing Date, NARCAT shall deposit, out of
the proceeds of the issuance of the Class A-1 Notes, Class A-2 Notes and the
Class B Notes, the Prefunded Amount into the Prefunding Account. Funds will be
withdrawn from the Prefunding Account in accordance with Section 12.06(d) and
shall not be available to the Holders or the Indenture Trustee for any other
purpose; provided, however, that any amounts
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which shall for any reason be held in the Prefunding Account on the Payment Date
next succeeding the Prefunded Railcar Expiration Date, together with earnings on
amounts in the Prefunding Account, shall on such Payment Date be withdrawn by
the Indenture Trustee and deposited to the NARCAT Collection Account for
application on such Payment Date as Available Funds pursuant to Section 12.02(d)
or Section 6.08, as applicable.
(b) All or a portion of the amounts held in the Prefunding Account
shall be invested and reinvested at NARCAT's written direction in one or more
Eligible Investments maturing no later than the Business Day prior to the
Prefunded Railcar Acquisition Date. In the absence of such written direction,
the Indenture Trustee shall invest funds in the Prefunding Account in Eligible
Investments described in clause (f) of the definition thereof. All income or
other gain from such investments shall be credited to the Prefunding Account and
any loss resulting from such investments shall be charged to the Prefunding
Account. Eligible Investments shall be made in the name of the Indenture Trustee
for the benefit of the Holders and the Class A Note Insurer.
(c) If any amounts invested as provided in Section 12.06(b) shall
be needed for disbursement from the Prefunding Account as set forth in Section
12.06(a) or (d), the Indenture Trustee shall cause such investments of such
Prefunding Account to be sold or otherwise converted to cash to the credit of
such Prefunding Account. The Indenture Trustee shall not be liable for any
investment loss resulting from investment of money in the Prefunding Account in
any Eligible Investment in accordance with the terms hereof (other than in its
capacity as obligor under any Eligible Investment) except as a result of its
negligence or misconduct.
(d) Upon a written direction executed by NARCAT and the
Controlling Party, on or prior to the Prefunded Railcar Acquisition Date, the
Indenture Trustee shall transfer the Prefunded Amount or such lesser amount
agreed to by such parties by wire transfer, in immediately available funds, to
the account identified in Schedule VI hereto (or such other account located in
the United States as the specified owner of such account shall designate in
writing to the Indenture Trustee) as the payment of the option price payable in
respect of the purchase option related to the Prefunded Railcar Assets contained
in the Asset Purchase Agreement.
Section 12.07. Redemption Account. Promptly following receipt of notice of
a proposed redemption of Notes in accordance with Section 14.01, the Indenture
Trustee shall establish a segregated trust account entitled "Redemption Account"
at its Corporate Trust Office (the "Redemption Account") for the benefit of the
Indenture Trustee on behalf of the Holders of the Notes and the Class A Note
Insurer for receipt of the Redemption Prices of the Notes to be redeemed. The
Redemption Account will contain two segregated subaccounts, one of which (the
"CARCAT Redemption Subaccount") will be maintained in the name of CARCAT and be
held exclusively for the benefit of the Indenture Trustee on behalf of the
Holders and the Class A Note Insurer and the other of which (the "NARCAT
Redemption Subaccount") will be maintained in the name of NARCAT and NARCAT
Mexico and be held exclusively for the benefit of the Indenture Trustee on
behalf of the Holders and the Class A Note Insurer. The Redemption Price related
to the Class A-3 Notes shall be deposited into the CARCAT Redemption Subaccount
and the Redemption Prices related to the Class A-1 Notes, the Class A-2 Notes
and the Class B Notes shall be deposited into the NARCAT Redemption
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Account. All amounts on deposit in the Redemption Account (including the CARCAT
Redemption Subaccount and the NARCAT Redemption Subaccount) shall remain
uninvested. On any Redemption Date, the Indenture Trustee shall (i) withdraw
from the CARCAT Redemption Subaccount the Redemption Price of all Class A-3
Notes to be redeemed on such Redemption Date and (ii) withdraw from the NARCAT
Redemption Subaccount the Redemption Prices of all Class A-1 Notes, Class A-2
Notes and Class B Notes to be redeemed on such Redemption Date, and the Paying
Agent will remit the Redemption Prices to the applicable Holders.
Section 12.08. Optional Deposits by the Class A Note Insurer. The Class A
Note Insurer shall at any time, and from time to time, with respect to a Payment
Date, have the option (but shall not be required, except in accordance with the
terms of the Class A Note Policy) to deliver amounts (any such amount, a "Class
A Note Insurer Optional Deposit") to the Indenture Trustee for deposit into one
or both of the Collection Accounts for any of the following purposes: (a) to
provide funds in respect of the payment of fees or expenses of any provider of
services to the Issuers with respect to such Payment Date; (b) to distribute as
a component of the Basic Principal Payments or Supplemental Principal Payments
to the extent necessary to avoid the occurrence of an Event of Default or a
Rapid Amortization Event; or (c) to include such amount as part of the Class A
Note Interest for such Payment Date to the extent that without such amount a
draw would be required to be made on the Class A Note Policy.
Section 12.09. Securities Account. The Indenture Trustee agrees that any
account held by it hereunder shall be maintained as a "securities account" as
defined in the Uniform Commercial Code as in effect in New York (the "New York
UCC"), and that it shall be acting as a "securities intermediary" for the
Indenture Trustee on behalf of the Secured Parties as the "entitlement holder"
(as such terms are defined in Section 8-102(a) of the New York UCC) with respect
to each such account. The parties hereto agree that each account shall be
governed by the laws of the State of New York, and regardless of any provision
in any other agreement, the "securities intermediary's jurisdiction" (within the
meaning of Section 8-110 of the New York UCC) shall be the State of New York.
The Indenture Trustee acknowledges and agrees that (a) each item of property
(whether investment property, financial asset, security, instrument or cash)
credited to the Accounts shall be treated as a "financial asset" within the
meaning of Section 8-102(a)(9) of the New York UCC and (b) notwithstanding
anything to the contrary, if at any time the Indenture Trustee shall receive any
entitlement order from the Indenture Trustee directing transfer or redemption of
any financial asset relating to the accounts, the Indenture Trustee shall comply
with such entitlement order without further consent by any Person. In the event
of any conflict of any provision of this Section 12.09 with any other provision
of this Indenture or any other agreement or document, the provisions of this
Section 12.09 shall prevail.
Section 12.10. Reports by Indenture Trustee to Holders. (a) On each Payment
Date, the Indenture Trustee shall account to the Class A Note Insurer and each
Holder to which payments of principal and interest are then being made the
amount which represents principal and the amount which represents interest, and
shall contemporaneously advise the Issuers of all such payments. The Indenture
Trustee may satisfy its obligations under this Section 12.10 by making available
electronically the Monthly Servicer Report to the Class A Note Insurer and each
such Holder of the Notes and the Issuers. The Indenture Trustee may make
available to the Class A
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Note Insurer, the Holders, the Note Owners, the Servicer, the Manager, the
Issuers and the Rating Agencies, via the Indenture Trustee's Internet website,
the Monthly Servicer Report and the Monthly Manager Report available each month;
provided, however, the Indenture Trustee shall have no obligation to provide
such information described in this Section 12.10 until it has received the
requisite information from the Issuers or the Servicer. The Indenture Trustee
will make no representation or warranties as to the accuracy or completeness of
such documents for which it is not the original source and will assume no
responsibility therefor.
The Indenture Trustee's Internet website shall be initially located at
"xxx.XXXXxxx.xxx" or at such other address as shall be specified by the
Indenture Trustee from time to time in writing to the Class A Note Insurer, the
Holders, the Note Owners, the Servicer, the Manager, the Issuers and the Rating
Agencies. In connection with providing access to the Indenture Trustee's
Internet website, the Indenture Trustee may require registration and the
acceptance of a disclaimer. The Indenture Trustee shall not be liable for the
dissemination of information in accordance with the Servicing Agreement, the
Management Agreement or this Indenture.
(b) On or before the 15th day prior to a Final Payment Date with
respect to any Notes, the Indenture Trustee shall provide notice to the Holders
of such Notes of the Final Payment Date for such Notes. Such notice shall
include a statement that interest shall have ceased to accrue as of the last day
of the month preceding the month in which the Final Payment Date occurs and
shall state the address to which any Holder of a Definitive Note must surrender
its Note prior to final payment.
(c) At least annually, or as otherwise required by law, the
Indenture Trustee shall distribute to Holders any information returns or other
tax information or statements as are required by applicable tax law to be
distributed to the Holders or as may be requested by any Holder to prepare such
Holder's tax returns. The Issuers shall prepare or cause to be prepared all such
information for distribution by the Indenture Trustee to the Holders.
ARTICLE XIII
THE CLASS A NOTE POLICY
Section 13.01. Claims under the Class A Note Policy. (a) If on any
Determination Date, the Policy Claim Amount is greater than zero, the Indenture
Trustee shall furnish to the Class A Note Insurer no later than 11:00 a.m.
Eastern time on the related Draw Date a completed Notice of Claim (as defined in
Section 13.01(b)) in the amount of the Policy Claim Amount. Amounts paid by the
Class A Note Insurer pursuant to a claim submitted under this Section 13.01
shall be deposited by the Indenture Trustee into the Policy Payment Account for
payment to Holders of the Class A Notes on the related Payment Date (or promptly
following payment by the Class A Note Insurer on a later date as set forth in
the Class A Note Policy).
(b) Any notice delivered by the Indenture Trustee to the Class A
Note Insurer pursuant to subsection 13.01(a) shall specify the Policy Claim
Amount claimed under the Class A Note Policy and shall constitute a "Notice of
Claim" under the Class A Note Policy. In accordance
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with the provisions of the Class A Note Policy, the Class A Note Insurer is
required to pay to the Indenture Trustee the Policy Claim Amount properly
claimed thereunder by 12:00 noon, New York, New York time, on the later of (i)
the third Business Day (as defined in the Class A Note Policy) following receipt
on a Business Day (as defined in the Class A Note Policy) of the Notice of
Claim, and (ii) the applicable Payment Date. Any payment made by the Class A
Note Insurer under the Class A Note Policy shall be applied solely to the
payment of the Class A Notes, and for no other purpose.
(c) The Indenture Trustee shall (i) receive as attorney-in-fact of
each Holder any Policy Claim Amount from the Class A Note Insurer and (ii)
deposit the same in the Policy Payment Account for distribution to Holders of
the Class A Notes. Any and all Policy Claim Amounts disbursed by the Indenture
Trustee from claims made under the Class A Note Policy shall not be considered
payment by the Issuers with respect to such Class A Notes, and shall not
discharge the obligations of the Issuers with respect thereto. The Insurer
shall, to the extent it makes any payment with respect to the Class A Notes,
become subrogated to the rights of the recipients of such payments to the extent
of such payments and any interest thereon. Subject to and conditioned upon any
payment with respect to the Class A Notes by or on behalf of the Class A Note
Insurer, each Holder of Class A Notes shall be deemed without further action to
have directed the Indenture Trustee to irrevocably assign to the Class A Note
Insurer all rights to the payment of interest or principal with respect to the
Class A Notes which are then due for payment to the extent of all payments made
by the Class A Note Insurer, and any interest owed thereon, and the Class A Note
Insurer may exercise any option, vote, right, power or the like with respect to
the Class A Notes to the extent that it has made payment with respect thereto
pursuant to the Class A Note Policy. To evidence such subrogation, the Note
Registrar shall note the Class A Note Insurer's rights as subrogee upon the
register of Holders upon receipt from the Class A Note Insurer of proof of
payment by the Class A Note Insurer of any Note Interest, Basic Principal
Payment or Supplemental Principal Payment in respect of the Class A Notes, and
the Class A Note Insurer shall be deemed to be a Class A Note Owner and Holder
of Class A Notes to the extent of such rights of subrogation. The foregoing
subrogation shall in all cases be subject to the rights of the Holders to
receive all payments in respect of the Class A Notes.
(d) The Indenture Trustee shall keep a complete and accurate
record of all funds deposited by the Class A Note Insurer into the Policy
Payment Account with respect to the Class A Note Policy and the allocation of
such funds to payment of interest and principal paid in respect of any Class A
Note. The Class A Note Insurer shall have the right to inspect such records at
reasonable times upon one Business Day's prior notice to the Indenture Trustee.
(e) The Indenture Trustee shall be entitled to enforce on behalf
of the Holders of the Class A Notes the obligations of the Class A Note Insurer
under the Class A Note Policy. Notwithstanding any other provision of this
Indenture or any other Transaction Document, the Holders of the Class A Notes
are not entitled to institute proceedings directly against the Class A Note
Insurer.
Section 13.02. Preference Claims. (a) In the event that the Indenture
Trustee has received a certified copy of an order of the appropriate court that
any payment of principal or interest (other than Overdue Class A Interest or
Incremental Class A Interest) paid on a Class A Note has
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been avoided in whole or in part as a preference payment under applicable U.S.
or Canadian bankruptcy law, the Indenture Trustee shall so notify the Class A
Note Insurer, shall comply with the provisions of the Class A Note Policy to
obtain payment by the Class A Note Insurer of such avoided payment, and shall,
at the time it provides notice to the Class A Note Insurer, notify Holders of
the Class A Notes by mail that, in the event that any Holder's payment is so
recoverable, such Holder will be entitled to payment pursuant to the terms of
the Class A Note Policy. The Indenture Trustee shall furnish to the Class A Note
Insurer its records evidencing the payments of principal and interest on the
Class A Notes, if any, which have been made by the Indenture Trustee and
subsequently recovered from Holders of Class A Notes, and the dates on which
such payments were made. Pursuant to the terms of the Class A Note Policy, the
Class A Note Insurer will make such payment on behalf of the Holder to the
receiver, conservator, debtor-in-possession or trustee in bankruptcy named in
the Order (as defined in the Class A Note Policy) or to the Indenture Trustee
for distribution to such receiver, conservator, debtor-in-possession or trustee
in bankruptcy and not to any Holder directly (unless a Holder has previously
paid such payment to the receiver, conservator, debtor-in-possession or trustee
in bankruptcy, in which case the Class A Note Insurer will make such payment to
such Holder or to the Indenture Trustee for distribution, in accordance with the
instructions to be provided by the Class A Note Insurer, to such Holder upon
proof of such payment reasonably satisfactory to the Class A Note Insurer).
(b) Each Notice of Claim shall provide that the Indenture Trustee,
on its behalf and on behalf of the Holders of Class A Notes, thereby appoints
the Class A Note Insurer as agent and attorney-in-fact for the Indenture Trustee
and each Holder of Class A Notes in any legal proceeding with respect to the
Class A Notes. The Indenture Trustee shall promptly notify the Class A Note
Insurer of any proceeding or the institution of any action (of which a
Responsible Officer of the Indenture Trustee has actual knowledge) seeking the
avoidance as a preferential transfer under applicable bankruptcy, insolvency,
receivership, rehabilitation or similar law (a "Preference Claim") of any
distribution made with respect to the Class A Notes. Each Holder of Class A
Notes, by its purchase thereof, and the Indenture Trustee hereby agree that so
long as an Class A Note Insurer Default shall not have occurred and be
continuing, the Class A Note Insurer may at any time during the continuation of
any proceeding relating to a Preference Claim direct all matters relating to
such Preference Claim, including, without limitation, (i) the direction of any
appeal of any order relating to any Preference Claim and (ii) the posting of any
surety, supersedeas or performance bond pending any such appeal at the expense
of the Class A Note Insurer, but subject to reimbursement as provided in the
Insurance Agreement. In addition, and without limitation of the foregoing, as
set forth in Section 13.01(c), the Class A Note Insurer shall be subrogated to,
and each Holder of Class A Notes and the Indenture Trustee hereby delegate and
assign, to the fullest extent permitted by law, the rights of the Indenture
Trustee and each Holder in the conduct of any proceeding with respect to a
Preference Claim, including, without limitation, all rights of any party to an
adversary proceeding action with respect to any court order issued in connection
with any such Preference Claim.
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Section 13.03. Surrender of Class A Note Policy. The Indenture Trustee
shall surrender the Class A Note Policy to the Class A Note Insurer for
cancellation upon the expiration of the Class A Note Policy in accordance with
the terms thereof.
Section 13.04. Class A Note Insurer Deemed Holder for Certain Purposes. So
long as no Class A Note Insurer Default has occurred and is continuing, (a) the
Class A Note Insurer shall be deemed to be the Holder of 100% of the Class A
Notes for the purposes of giving any consents, waivers, approvals, instructions,
directions, declarations, notices and/or taking any other action pursuant to the
Indenture and the other Transaction Documents except for any consents, waivers,
approvals or other actions which, under the terms of Section 9.02, expressly
require the consent of all Holders; and (b) the Class A Note Insurer shall have
the right to exercise all remedies of the Holders of the Class A Notes under
this Indenture without any consent of such Holders, and such Holders may
exercise such remedies only with the prior written consent of the Class A Note
Insurer, except as otherwise expressly provided herein. Any reference in the
Indenture or any other Transaction Document to events or actions which may
materially, adversely, or detrimentally affecting the rights or interests of the
Holders, or words of similar meaning, shall be deemed to refer to the rights or
interests of the Class A Note Insurer as well as of the Holders.
ARTICLE XIV
REDEMPTION OF NOTES
Section 14.01. Redemption at the Option of the Issuers; Election to Redeem.
(a) The Notes may be redeemed in whole, but not in part, at the option of the
Issuers, for the Redemption Prices applicable at such time on any Payment Date
on or after February 15, 2011. Any such redemption shall be made solely out of
the proceeds of the sale by the Issuers of Railcars, Leases and other Railcar
Assets, or a refinancing by the Issuers of Railcars, Leases and other Railcar
Assets (in either case, "Source Payments").
(b) In addition, the Notes may be redeemed in whole, but not in
part, for the Redemption Prices applicable at such time on any Payment Date on
which (after giving effect to distributions on such Payment Date) the aggregate
unpaid principal amount of the Notes is less than 10% of the aggregate principal
amount of the Notes as of the Closing Date, such prepayment to be at the option
of NARCAT and NARCAT Mexico, in the case of the Class A-1 Notes, the Class A-2
Notes and the Class B Notes, and at the option of CARCAT, in the case of the
Class A-3 Notes; provided, however, that (i) such options must be exercised
concurrently by each of the Issuers (otherwise, no such option may be exercised
by any of the Issuers) and (ii) concurrently with such redemption, all amounts
higher than clause (xxi) of Section 6.08(a) or clause (xxiii) of Section
12.02(d) shall be paid to the parties entitled to such amounts on such Payment
Date.
(c) The Issuers shall set the Redemption Date and the Redemption
Record Date and give notice thereof to the Indenture Trustee pursuant to Section
14.02.
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(d) Installments of interest and principal due on or prior to a
Redemption Date shall continue to be payable to the Holders of Notes called for
redemption as of the relevant Record Dates according to their terms and the
provisions of Section 3.01. The election of the Issuers to redeem any Notes
pursuant to this Section 14.01 shall be evidenced by a Board Resolution of each
Issuer directing the Indenture Trustee to make the payment of the Redemption
Prices on all of the Notes to be redeemed from monies deposited with the
Indenture Trustee pursuant to Section 14.04.
Section 14.02. Notice to Indenture Trustee and Class A Note Insurer. In the
case of any redemption pursuant to Section 14.01, the Issuers shall, at least 20
days prior to the Redemption Date (or such lesser period of time as may be
consented to by the Indenture Trustee and, in the event that any Class A Notes
shall then be Outstanding, the Class A Note Insurer), notify the Indenture
Trustee and, in the event that any Class A Notes shall then be Outstanding, the
Class A Note Insurer of such Redemption Date.
Section 14.03. Notice of Redemption by the Issuers. Notice of redemption
pursuant to Section 14.01 shall be given by the Issuers (or by the Indenture
Trustee at the Issuers' request) in the name and at the expense of the Issuers
by first-class mail, postage prepaid, mailed not less than 15 days prior to the
applicable Redemption Date, to each Holder of Notes whose Notes are to be
redeemed, at its address in the Note Register.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Prices for all Notes to be redeemed;
(c) that on the Redemption Date, the Redemption Prices
will become due and payable upon each such Note, and that interest
thereon shall cease to accrue on such date; and
(d) the place where such Notes are to be surrendered
prior to payment of the applicable Redemption Price.
Failure to give notice of redemption, or any defect therein, to any
Holder of any Note selected for redemption shall not impair or affect the
validity of the redemption of any other Note.
Section 14.04. Deposit of the Redemption Prices. (a) On or before the
Business Day immediately preceding the Redemption Date, the Issuers shall
deliver to the Indenture Trustee, the portion of the Redemption Differential
related to the Class A-1 Notes, the Class A-2 Notes and the Class B Notes for
deposit to the NARCAT Redemption Subaccount and the portion of the Redemption
Differential related to the Class A-3 Notes for deposit to the CARCAT Redemption
Subaccount, if any, which, in the case of an Optional Redemption, shall consist
solely of Source Payments.
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(b) On or before the Redemption Date, the Indenture Trustee will,
in accordance with the Monthly Servicer Report (or to the extent not available
on a timely basis or if the Controlling Party has notified the Indenture Trustee
that the Monthly Servicer Report is incorrect, the instructions of the
Controlling Party) transfer from (i) the Cash Collateral Accounts to the
Redemption Account, the Remaining Cash Collateral Amounts, and (ii) the
Collection Accounts to the Redemption Account, the lesser of (a) the amount on
deposit in the Collection Account not needed to pay any amounts higher than
clause (xxi) of Section 6.08(a) or clause (xxiii) of Section 12.02(d) to be paid
on such Redemption Date and (b) the Redemption Price.
(c) Notice of redemption having been given as provided in Section
14.03 above, on the applicable Redemption Date, the Indenture Trustee will apply
the amounts on deposit in the NARCAT Redemption Subaccount and the CARCAT
Redemption Subaccount to redemption of the Notes which have not been fully paid
on such Payment Date pursuant to Section 12.02(d) or Section 6.08, as applicable
(provided that Definitive Notes must be surrendered at the Corporate Trust
Office prior to final payment), and (unless the Class A Note Insurer in the case
of the Class A Notes or the Issuers in the case of the Class B Notes shall
default in the payment of the Redemption Price), such Notes shall cease to bear
interest.
Section 14.05. Notes Payable on Redemption Date. Notice of redemption
having been given as provided in Section 14.03, the Notes to be redeemed shall,
on the applicable Redemption Date, become due and payable at the Redemption
Price and on such Redemption Date (unless the Issuers shall default in the
payment of the Redemption Price) such Notes shall cease to bear interest. The
Holders of such Notes shall be paid the applicable Redemption Price by the
Paying Agent on behalf of the Issuers on the Redemption Date; provided, however,
that installments of principal and interest which are due on or prior to the
Redemption Date shall be payable to the Holders of such Notes registered as such
on the relevant Record Dates according to their terms and the provisions of
Section 3.08.
If the Holders of any Note called for redemption shall not be so paid
the principal shall, until paid, bear interest from the Redemption Date at the
related Note Interest Rate.
ARTICLE XV
PROVISIONS OF GENERAL APPLICATION
Section 15.01. General Provisions. All of the provisions of this Article XV
shall apply to this Indenture.
Section 15.02. Acts of Holders. (a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture to
be given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Indenture Trustee, and, where it is hereby expressly
required, to the Issuers. Such instrument or
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instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Section 7.01) conclusive in favor of the Indenture Trustee and
the Issuers, if made in the manner provided in this Section 15.02.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Note shall bind the Holder
of every Note issued upon the registration thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuers in reliance thereon, whether or not notation of
such action is made upon such Note.
Section 15.03. Notices, Etc, to Indenture Trustee, Issuers, the Class A
Note Insurer and Rating Agencies. Any request, demand, authorization, direction,
notice, consent, waiver or Act of Holders or other document provided or
permitted by this Indenture to be made upon, given or furnished to, or filed
with any Person shall be in writing and shall be delivered personally or mailed
by first-class registered or certified mail, postage prepaid, or by telephonic
facsimile transmission or overnight delivery service, prepaid, at the address
listed below or at any other address previously furnished in writing to the
Indenture Trustee and each of the other entities referred to in this Section
15.03 by the applicable Person. Any such notice shall be deemed delivered upon
its actual receipt; provided, however, that if any such notice is delivered on a
day that is not a Business Day at the place of delivery, such notice shall be
deemed to have been delivered on the immediately following Business Day;
provided further, however, that if tender of any notice is refused by the
addressee, such notice shall be deemed to have been delivered upon such tender.
To the Indenture Trustee: Xxxxx Fargo Bank, National Association
MAC X0000-000
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Corporate Trust Services -
Asset-Backed Administration
Phone: (000) 000-0000
Fax: (000) 000-0000
To the Issuers: NARCAT LLC
000 Xxxx Xxxxxx Xxxxx
Xxxxx X
Xxxxxx, Xxxx 00000
Attention: Xxxxx Xxxx, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
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CARCAT ULC
000 Xxxx Xxxxxx Xxxxx
Xxxxx X
Xxxxxx, Xxxx 00000
Attention: Xxxxx Xxxx, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
NARCAT Mexico, S. de X.X. de C.V.
000 Xxxx Xxxxxx Xxxxx
Xxxxx X
Xxxxxx, Xxxx 00000
Attention: Xxxxx Xxxx, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
To S&P: Standard & Poor's
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Surveillance
Phone: (000) 000-0000
Fax: (000) 000-0000
To Fitch: Fitch, Inc.
00 Xxxx Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: ABS Monitoring Group
(Equipment)
Fax: (000) 000-0000
To the Class A Note Insurer: MBIA Insurance Corporation
000 Xxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attention: Insured Portfolio Management -
SF
Phone: (000) 000-0000
Fax: (000) 000-0000
Section 15.04. Notices to Holders; Waiver. Where this Indenture provides
for notice to Holders of any event such notice shall be sufficiently given
(unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, or by overnight courier, to each Holder affected by
such event, at its address as it appears on the Note Register, not later than
the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed,
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders, and any notice which is mailed by certified or
registered mail, with return receipt requested, shall conclusively be presumed
to have been duly given.
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Where this Indenture provides for notice in any manner, such notice may
be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Indenture Trustee,
but such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Holders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a
sufficient giving of such notice.
Section 15.05. Successors and Assigns. All covenants and agreements in this
Indenture by the Issuers shall bind their respective successors and assigns,
whether so expressed or not.
Section 15.06. Separability. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
Section 15.07. Benefits of Indenture. Nothing in this Indenture or in the
Notes, express or implied, shall give to any Person, other than the parties
hereto, the Holders, the Class A Note Insurer and any Paying Agent which may be
appointed pursuant to the provisions hereof and any of their successors
hereunder, any benefit or any legal or equitable right, remedy or claim under
this Indenture or under the Notes. The Class A Note Insurer is an express
third-party beneficiary of this Indenture and is entitled to rely upon and
enforce the terms hereof as if a party hereto.
Section 15.08. Legal Holidays. In any case where the date of any Payment
Date, or the Stated Legal Maturity Date of any Note, shall not be a Business
Day, then (notwithstanding any other provision of the Notes or this Indenture)
payment of principal, interest, or premium, if any, need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the nominal date of any such Stated Legal Maturity Date
or Payment Date, and interest shall accrue for the period from and after any
such nominal date to the date such payment is actually made.
SECTION 15.09. GOVERNING LAW. THIS INDENTURE AND EACH NOTE SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN (INCLUDING,
WITHOUT LIMITATION, SECTION 5-1401 AND SECTION 5-1402 OF THE GENERAL OBLIGATIONS
LAWS, BUT OTHERWISE WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS).
Section 15.10. Counterparts. This instrument may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument. Delivery by facsimile of
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an executed signature page to this Indenture shall be as effective as delivery
of an executed counterpart hereof.
Section 15.11. Corporate Obligation. No recourse may be taken, directly or
indirectly, against any incorporator, subscriber to the capital stock,
stockholder, employee, officer or director of any Issuer or of any predecessor
or successor of any Issuer with respect to the Issuer's obligations on the Notes
or under this Indenture or any certificate or other writing delivered in
connection herewith.
Section 15.12. Compliance Certificates and Opinions. Upon any application,
order or request by the Issuers to the Indenture Trustee and the Class A Note
Insurer to take any action under any provision of this Indenture for which a
specific request is required under this Indenture, the Issuers shall furnish to
the Indenture Trustee an Officer's Certificate of the Issuers stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with, except that in the case of any such
application or request as to which the furnishing of other documents is
specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that each individual signing such
certificate or opinion has read or has caused to be read such covenant
or condition and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied with.
Section 15.13. No Bankruptcy Petition Against any Issuer. Notwithstanding
anything herein to the contrary, the Indenture Trustee agrees (and each Holder
by its acceptance of a Note shall be deemed to agree) that, prior to the date
that is one year and one day after the payment in full of all amounts payable
with respect to the Notes, and all other obligations of the Issuers under this
Indenture and the other Transaction Documents, it will not institute against any
Issuer, or join any other Person in instituting against any Issuer, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or other proceedings under the laws of the United States, any state of the
United States or any foreign jurisdiction. This Section 15.13 shall survive the
termination of this Indenture.
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SECTION 15.14. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG ANY OF THEM ARISING OUT OF,
CONNECTED WITH, RELATING TO OR INCIDENTAL TO THE RELATIONSHIP BETWEEN THEM IN
CONNECTION WITH THIS INDENTURE OR THE OTHER TRANSACTION DOCUMENTS.
SECTION 15.15. CONSENT TO JURISDICTION. EACH OF THE PARTIES HERETO HEREBY
SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN THE
CITY OF NEW YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS INDENTURE, ANY OTHER TRANSACTION DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, ANY OBJECTION WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING IN THIS SECTION 15.15
SHALL AFFECT THE RIGHT OF ANY PERSON TO BRING ANY ACTION OR PROCEEDING AGAINST
ANY PARTY HERETO OR ANY OF THEIR RESPECTIVE PROPERTY IN THE COURTS OF OTHER
JURISDICTIONS.
Section 15.16. Integration. This Indenture contains the final and complete
integration of all prior expressions by the parties hereto with respect to the
subject matter hereof and shall (together with the other Transaction Documents)
constitute the entire agreement among the parties hereto with respect to the
subject matter hereof, superseding all prior oral or written understandings.
Section 15.17. Successors and Assigns; Binding Effect. This Indenture shall
be binding on the parties hereto and their respective successors and assigns;
provided, however, that no Issuer shall assign (or shall permit or cause the
assignment of) any of its rights, duties or obligations related to or in
connection with this Indenture or any of the other Transaction Documents,
without the prior written consent the Indenture Trustee (acting at the direction
of the Controlling Party and the Class A Note Insurer).
Section 15.18. Further Assurances. Each of the Issuers hereby agrees to do
and perform, from time to time, any and all acts and to execute any and all
further instruments required or reasonably requested by the other party or by
the Controlling Party to more fully to effect the purposes of this Indenture.
Section 15.19. Expenses. Each of the Issuers hereby jointly and severally
agrees to pay all out-of-pocket costs and expenses incurred by the Indenture
Trustee and the Class A Note Insurer in connection with the development,
negotiation, preparation and execution of this Indenture and the other
Transaction Documents, in connection with any amendments, modifications or
waivers
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of the provisions of this Indenture or any other Transaction Document (whether
or not the transactions thereby contemplated shall be consummated), or in
connection with any actual or proposed sale or replacement of any Railcar Asset
or incurred by the Indenture Trustee and the Class A Note Insurer in connection
with the enforcement or protection of its rights in connection with this
Indenture and the other Transaction Documents or in connection with the
agreements made hereunder and, in connection with any such enforcement or
protection, the fees, charges and disbursements of any counsel for the Indenture
Trustee and the Class A Note Insurer.
Section 15.20. Survival of Representations and Warranties. All agreements,
representation and warranties made herein shall survive the execution and
delivery of this Indenture, the Notes and the other Transaction Documents and
the making and repayment of the Notes.
Section 15.21. Interest Calculations. Whenever interest is calculated
pursuant to any provision of this Indenture on the basis of a period other than
a calendar year, the annual rate of interest to which such rate of interest as
determined by such calculation is equivalent, for purposes of the Interest Act
(Canada), is such rate as so calculated multiplied by a fraction, the numerator
of which is the actual number of days in the particular calendar year in respect
of which the calculation is made, and the denominator of which is the number of
days used in the calculation.
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IN WITNESS WHEREOF, the Issuers and the Indenture Trustee have caused
this Indenture to be duly executed by their respective officers thereunto duly
authorized and their respective seals, duly attested, to be hereunto affixed,
all as of the day and year first above written.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Indenture Trustee
By: /s/ Xxx Xxxxx
--------------------
Name: Xxx Xxxxx
Title: Vice President
NARCAT LLC, as an Issuer
By: /s/ Xxxxxx X. Xxxx
--------------------
Name: Xxxxxx X. Xxxx
Title: Manager
CARCAT ULC, as an Issuer
By: /s/ Xxxxxx X. Xxxx
--------------------
Name: Xxxxxx X. Xxxx
Title: President/Secretary
NARCAT MEXICO, S. DE X.X. DE C.V., as an
Issuer
By: /s/ Xxxxxx X. Xxxx
--------------------
Name: Xxxxxx X. Xxxx
Title: Legal Representative
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