EX-10.27






Exhibit 10.27




AMENDED AND RESTATED AGREEMENT FOR EMPLOYMENT

FOLLOWING A CHANGE OF CONTROL




          AGREEMENT by and between GATX Corporation, a New York corporation (the “Company”) and Brian A.
Kenney (the “Executive”) dated as of the 1ST day of January 2009.




          The Board of Directors of the Company (the “Board”), has determined that it is in the best
interests of the Company and its shareholders to assure that the Company will have the continued
dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of
Control (as defined below). The Board believes it is imperative to diminish the inevitable
distraction of the Executive by virtue of the personal uncertainties and risks created by a
pending or threatened Change of Control and to encourage the Executive’s full attention and
dedication to the Company currently and in the event of any threatened or pending Change of
Control, and to provide the Executive with compensation and benefits arrangements upon a Change of
Control which ensure that the compensation and benefits expectations of the Executive will be
satisfied and which are competitive with those of other corporations. Therefore, in order to
accomplish these objectives, the Board has caused the Company to enter into this Agreement.




          NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:




          1. Certain Definitions. (a) The “Effective Date” shall mean the first date during
the Change of Control Period (as defined in Section 1(b)) on which a Change of Control (as defined
in Section 2) occurs. Anything in this Agreement to the contrary notwithstanding, if a Change of
Control occurs, and if the Executive’s employment with the Company is terminated prior to the date
on which the Change of Control occurs, and if it is reasonably demonstrated by the Executive that
such termination of employment (i) was at the request of a third party who has taken steps
reasonably calculated to effect a Change of Control or (ii) otherwise arose in connection with or
anticipation of a Change of Control, then for all purposes of this Agreement the “Effective Date”
shall mean the date immediately prior to the date of such termination of employment.




          (b) The “Change of Control Period” shall mean the period commencing on January 1, 2009, and
ending on the second anniversary of the date thereof; provided, however, that commencing on January
1, 2010, and on each annual anniversary of such date (such date and each annual anniversary thereof
shall be hereinafter referred to as the “Renewal Date”), unless previously terminated, the Change
of Control Period shall be automatically extended so as to terminate two years from such Renewal
Date, unless at least 60 days prior to the Renewal Date the Company shall give notice to the
Executive that the Change of Control Period shall not be so extended.




          2. Change of Control. For the purpose of this Agreement, a “Change of Control” shall
mean:




          (a) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3)
or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”)
of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of
20% or more of either (i) the then outstanding shares of common stock of the Company (the
“Outstanding Company Common Stock”) or (ii) the combined voting power of the then outstanding
voting securities of the Company entitled to vote generally in the election of



 









 






directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of
this subsection (a), the following acquisitions shall not constitute a Change of Control: (1) any
acquisition directly from the Company, (2) any acquisition by the Company, (3) any acquisition by
any employee benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company or (4) any acquisition by any corporation pursuant to a
transaction which complies with clauses (i), (ii) and (iii) of subsection (c) of this Section 2; or




          (b) Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease
for any reason to constitute at least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the date hereof whose election, or nomination for
election by the Company’s shareholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as though such individual were a
member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or threatened election contest with respect to
the election or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or




          (c) Consummation of a reorganization, merger or consolidation or sale or other disposition
(including, without limitation, a disposition occurring by merger, consolidation, sale, or other
similar transactions of one or more subsidiaries of the Company) of all or substantially all of the
assets of the Company (a “Business Combination”), in each case unless, following such Business
Combination (other than a Business Combination of the type referred to in the first parenthetical
of this subsection (c) which results in the disposition of all or substantially all of the assets
of the Company), (i) all or substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company
Voting Securities immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 65% of, respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, of the corporation resulting from such Business
Combination (including, without limitation, a corporation which as a result of such transaction
owns the Company or all or substantially all of the Company’s assets either directly or through one
or more subsidiaries) in substantially the same proportions as their ownership, immediately prior
to such Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be, (ii) no Person (excluding any corporation resulting from such
Business Combination or any employee benefit plan (or related trust) of the Company or such
corporation resulting from such Business Combination) beneficially owns, directly or indirectly,
20% or more of, respectively, the then outstanding shares of common stock of the corporation
resulting from such Business Combination or the combined voting power of the then outstanding
voting securities of such corporation except to the extent that such ownership existed prior to the
Business Combination and (iii) at least a majority of the members of the board of directors of the
corporation resulting from such Business Combination were members of the Incumbent Board at the
time of the execution of the initial agreement, or of the action of the Board, providing for such
Business Combination; or




          (d) Approval by the shareholders of the Company of a complete liquidation or dissolution of
the Company; or




          (e) Consummation of a reorganization, merger or consolidation or sale or other disposition of
any subsidiary or of all or substantially all of the assets of any subsidiary of the



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Company or a disposition (in a single transaction or series of integrated transactions) of all or
substantially all of the assets of an operating segment of the Company as identified in the
financial statements included in the Company’s most recent Annual Report on Form 10-K (each a
“Business Segment”) that is, in either case, the primary employer of the Executive or to which the
Executive’s responsibilities primarily relate immediately prior thereto, and which does not
constitute a Business Combination as defined in Section 2(c), unless immediately thereafter the
Company, either directly or indirectly, owns (i) at least 50% of the voting stock of any such
subsidiary disposed of or, (ii) in the case of the disposition of all or substantially all of the
assets of a subsidiary or Business Segment, at least 50% of both the voting power over and the
equity in any entity holding title to such assets.




          3. Employment Period. The Company hereby agrees to continue the Executive in its
employ, and the Executive hereby agrees to remain in the employ of the Company subject to the terms
and conditions of this Agreement, for the period commencing on the Effective Date and ending on the
second anniversary of such date (the “Employment Period”).




          4. Terms of Employment. (a) Position and Duties. (i) During the Employment
Period, (A) the Executive’s position (including status, offices, titles and reporting
requirements), authority, duties and responsibilities shall be at least commensurate in all
material respects with the most significant of those held, exercised and assigned by or to the
Executive at any time during the 120-day period immediately preceding the Effective Date and (B)
the Executive’s services shall be performed at the location where the Executive was employed
immediately preceding the Effective Date or any office or location less than 35 miles from such
location.




               (ii) During the Employment Period, and excluding any periods of vacation and sick leave to
which the Executive is entitled, the Executive agrees to devote reasonable attention and time
during normal business hours to the business and affairs of the Company and, to the extent
necessary to discharge the responsibilities assigned to the Executive hereunder, to use the
Executive’s reasonable best efforts to perform faithfully and efficiently such responsibilities.
During the Employment Period it shall not be a violation of this Agreement for the Executive to (A)
serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill
speaking engagements or teach at educational institutions and (C) manage personal investments, so
long as such activities do not significantly interfere with the performance of the Executive’s
responsibilities as an employee of the Company in accordance with this Agreement. It is expressly
understood and agreed that to the extent that any such activities have been conducted by the
Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of
activities similar in nature and scope thereto) subsequent to the Effective Date shall not
thereafter be deemed to interfere with the performance of the Executive’s responsibilities to the
Company.




          (b) Compensation. (i) Base Salary. During the Employment Period, the
Executive shall receive an annual base salary (“Annual Base Salary”), which shall be paid at a
monthly rate, at least equal to twelve times the highest monthly base salary paid or payable,
including any base salary which has been earned but deferred, to the Executive by the Company and
its Affiliates during the twelve-month period immediately preceding the month in which the
Effective Date occurs. During the Employment Period, the Annual Base Salary shall be reviewed no
more than twelve months after the last salary increase awarded to the Executive prior to the
Effective Date and thereafter at least annually. Any increase in Annual Base Salary shall not
serve to limit or reduce any other obligation to the Executive under this Agreement. Annual Base
Salary shall not be reduced after any such increase and the term Annual Base Salary as utilized in
this Agreement shall refer to Annual Base Salary as so increased. As used



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in this Agreement, the term “Affiliates” means all persons with whom the Company is considered to
be a single employer under section 414(b) of the Internal Revenue Code (the “Code”) and all persons
with whom the Company would be considered a single employer under section 414(c) of the Code.




               (ii) Annual Bonus. In addition to Annual Base Salary, the Executive shall be
awarded, for each fiscal year ending during the Employment Period, an annual bonus (the “Annual
Bonus”) in cash that is not less than the Executive’s target level of bonus for the year in which
the Change of Control occurs. Each such Annual Bonus shall be paid no later than the
15th day of the third month of the fiscal year next following the fiscal year for which
the Annual Bonus is awarded.




               (iii) Long-Term Incentive, Savings and Retirement Plans. During the Employment Period,
the Executive shall be entitled to participate in all long-term incentive, stock compensation,
savings and retirement plans, practices, policies and programs applicable generally to other peer
executives of the Company and its Affiliates, but in no event shall such plans, practices, policies
and programs provide the Executive with long-term incentive opportunities (measured with respect to
both regular and special incentive opportunities, to the extent, if any, that such distinction is
applicable), stock compensation opportunities, savings opportunities and retirement benefit
opportunities, in each case, less favorable, in the aggregate, than the most favorable of those
provided by the Company and its Affiliates for the Executive under such plans, practices, policies
and programs as in effect at any time during the 120-day period immediately preceding the Effective
Date or if more favorable to the Executive, those provided generally at any time after the
Effective Date to other peer executives of the Company and its Affiliates.




               (iv) Welfare Benefits. During the Employment Period, the Executive and/or the
Executive’s family, as the case may be, shall be eligible for participation in and shall receive
all benefits under the plans, practices, policies and programs provided by the Company and its
Affiliates that provide Welfare Benefits to the extent applicable generally to other peer
executives of the Company and its Affiliates, but in no event shall such plans, practices, policies
and programs provide the Executive with benefits which are less favorable, in the aggregate, than
the most favorable of such plans, practices, policies and programs in effect for the Executive at
any time during the 120-day period immediately preceding the Effective Date or, if more favorable
to the Executive, those provided generally at any time after the Effective Date to other peer
executives of the Company and its Affiliates. The term “Welfare Benefits” means medical,
prescription, dental, disability, employee life, group life, accidental death and travel accident
insurance benefits.




               (v) Expenses. During the Employment Period, the Executive shall be entitled to
receive prompt reimbursement for all reasonable expenses incurred by the Executive in accordance
with the most favorable policies, practices and procedures of the Company and its Affiliates in
effect for the Executive at any time during the 120-day period immediately preceding the Effective
Date or, if more favorable to the Executive, as in effect generally at any time thereafter with
respect to other peer executives of the Company and its Affiliates.




               (vi) Fringe Benefits. During the Employment Period, the Executive shall be entitled
to fringe benefits, including, without limitation, tax and financial planning services, payment of
club dues, and, if applicable, use of an automobile and payment of related expenses, or payment of
an automobile allowance in accordance with the most favorable plans, practices, programs and
policies of the Company and its Affiliates in effect for the Executive at



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any time during the 120-day period immediately preceding the Effective Date or, if more favorable
to the Executive, as in effect generally at any time thereafter with respect to other peer
executives of the Company and its Affiliates.




               (vii) Office and Support Staff. During the Employment Period, the Executive shall be
entitled to an office or offices of a size and with furnishings and other appointments, and to
exclusive personal secretarial and other assistance, at least equal to the most favorable of the
foregoing provided to the Executive by the Company and its Affiliates at any time during the
120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as
provided generally at any time thereafter with respect to other peer executives of the Company and
its Affiliates.




               (viii) Vacation. During the Employment Period, the Executive shall be entitled to
paid vacation in accordance with the most favorable plans, policies, programs and practices of the
Company and its Affiliates as in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive, as in effect
generally at any time thereafter with respect to other peer executives of the Company and its
Affiliates.




          5. Termination of Employment. (a) Death or Disability. The Executive’s
employment shall terminate automatically upon the Executive’s death during the Employment Period.
If Disability of the Executive has occurred during the Employment Period (pursuant to the
definition of Disability set forth below), the Company may give to the Executive written notice in
accordance with Section 12(b) of this Agreement of its intention to terminate the Executive’s
employment no sooner than 30 days following such notice. In such event, the Executive’s employment
with the Company shall terminate effective on the date specified in such notice (the “Disability
Effective Date”), provided that the Executive shall not have returned to full-time performance of
the Executive’s duties prior thereto. For purposes of this Agreement, “Disability” shall mean any
disability that (a) entitles the Executive to disability income benefits under the GATX Long Term
Disability Income Plan as in effect on the day prior to the Effective Date, and (b) prevents the
Executive, for the duration of the Employment Period, from engaging in the same or comparable type
of employment as that in which the Executive was engaged on the day prior to the Effective Date.




          (b) Cause. The Company may terminate the Executive’s employment during the
Employment Period only for Cause. For purposes of this Agreement, “Cause” shall mean:





          (i) the willful and continued failure of the Executive to perform substantially the
Executive’s duties with the Company or one of its affiliates (other than any such failure
resulting from incapacity due to physical or mental illness), after a written demand for
substantial performance is delivered to the Executive by the Board of the Company which
specifically identifies the manner in which the Board believes that the Executive has not
substantially performed the Executive’s duties, or




          (ii) the willful engaging by the Executive in illegal conduct or gross misconduct which
is materially and demonstrably injurious to the Company.


For purposes of this provision, no act or failure to act, on the part of the Executive, shall be
considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or
without reasonable belief that the Executive’s action or omission was in the best interests of the
Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly


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adopted by the Board or upon the instructions or concurrence of the Board or based upon the advice
of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the
Executive in good faith and in the best interests of the Company. The cessation of employment of
the Executive shall not be deemed to be for Cause unless and until there shall have been delivered
to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than
three-quarters of the entire membership of the Board at a meeting of the Board called and held for
such purpose (after reasonable notice is provided to the Executive and the Executive is given an
opportunity, together with counsel, to be heard before the Board), finding that, in the good faith
opinion of the Board, the Executive is guilty of the conduct described in subparagraph (i) or (ii)
above, and specifying the particulars thereof in detail.




          (c) Good Reason. The Executive’s employment may be terminated during the Employment
Period by the Executive for Good Reason. For purposes of this Agreement, “Good Reason” shall mean
the occurrence of one or more of the following conditions without the consent of the Executive:





          (i) A material diminution in the Executive’s base compensation, compared with the base
compensation required to be provided to the Executive in accordance with Section 4(b).




          (ii) A material diminution in the Executive’s authority, duties, or responsibilities,
compared with the authority, duties, and responsibilities of the Executive provided in
Section 4(a).




          (iii) A requirement that the Executive report to anyone other than the Board.




          (iv) A material diminution in the budget over which the Executive retains authority,
compared with the most significant budget over which the Executive had authority at any time
during the 120-day period immediately preceding the Effective Date.




          (v) A material change in the geographic location at which the Executive must perform
the services.




          (vi) Any other action or inaction by the Company that constitutes a material breach of
this Agreement.


If (I) the Executive provides written notice to the Company of the occurrence of Good Reason within
a reasonable time (not more than 90 days) after the Executive has knowledge of the circumstances
constituting Good Reason, which notice specifically identifies the circumstances which the
Executive believes constitute Good Reason; (II) the Company fails to notify the Executive of the
Company’s intended method of correction within a reasonable period of time (not less than 30 days)
after the Company receives the notice, or the Company fails to correct the circumstances within a
reasonable period of time after such notice (except that no such opportunity to correct shall be
applicable if the circumstances constituting Good Reason are those described in paragraph (v)
above, relating to relocation); and (III) the Executive resigns within a reasonable time after
receiving the Company’s response, if such notice does not indicate an intention to correct such
circumstances, or within a reasonable time after the Company fails to correct such circumstances
(provided that in no event may such termination occur more than two years after the initial
existence of the condition constituting Good Reason); then the Executive shall be considered to
have terminated for Good Reason.




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          (d) Notice of Termination. Any termination by the Company for Cause, or by the
Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto
given in accordance with Section 12(b) of this Agreement. For purposes of this Agreement, a
“Notice of Termination” means a written notice which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated and (iii) if the Date of Termination (as defined below)
is other than the date of receipt of such notice, specifies the termination date (which date shall
be not more than thirty days after the giving of such notice). The failure by the Executive or the
Company to set forth in the Notice of Termination any fact or circumstance which contributes to a
showing of Good Reason or Cause shall not waive any right of the Executive or the Company,
respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such
fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.




          (e) Date of Termination. “Date of Termination” means (i) if the Executive’s
employment is terminated by the Company for Cause, or by the Executive for Good Reason, the date of
receipt of the Notice of Termination or any later date specified therein, as the case may be, (ii)
if the Executive’s employment is terminated by the Company other than for Cause or Disability, the
Date of Termination shall be the date on which the Company notifies the Executive of such
termination and (iii) if the Executive’s employment is terminated by reason of death or Disability,
the Date of Termination shall be the date of death of the Executive or the Disability Effective
Date, as the case may be. Notwithstanding the foregoing, references in the Agreement to the
Executive’s Date of Termination, and the Executive’s termination of employment (including
references to the Executive’s employment termination, and to the Executive terminating employment)
shall mean the Executive ceasing to be employed by the Company and its Affiliates, subject to the
following:





          (i) The employment relationship will be deemed to have ended at the time the Executive
and his employer reasonably anticipate that the level of bona fide services the Executive
would perform for the Company and its Affiliates after such date (whether as an employee or
independent contractor, but not as a director) would permanently decrease to no more than 20%
of the average level of bona fide services performed over the immediately preceding 36 month
period (or the full period of service to the Company and its Affiliates if the Executive has
performed services for the Company and its Affiliates for less than 36 months). In the
absence of an expectation that the Executive will perform at the above-described level, the
Date of Termination will not be delayed solely by reason of the Executive continuing to be on
the Company’s and its Affiliates’ payroll after such date.




          (ii) The employment relationship will be treated as continuing intact while the
Executive is on a bona fide leave of absence (determined in accordance with Treas. Reg.
§1.409A-1(h)).




          (iii) If, pursuant to Section 11, the Agreement is assumed by a successor, the
substitution of the successor for the Company shall not be treated as a termination of
employment.



          6. Obligations of the Company upon Termination. (a) Good Reason; Other Than for
Cause, Death or Disability. If, during the Employment Period, the Company shall terminate



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the Executive’s employment other than for Cause, death or Disability or the Executive shall
terminate employment for Good Reason:





     (i) The Company shall pay to the Executive in a lump sum in cash within 30 days after
the Date of Termination the aggregate of the following amounts:




     A. the sum of (1) the Executive’s Annual Base Salary through the Date of
Termination to the extent not theretofore paid, (2) the product of (x) the Executive’s
Annual Bonus as defined in Section 4(b)(ii) of the Agreement (annualized for any
fiscal year consisting of less than twelve full months or during which the Executive
was employed for less than twelve full months) and (y) a fraction, the numerator of
which is the number of days in the current fiscal year through the Date of
Termination, and the denominator of which is 365 and (3) any accrued vacation pay, in
each case to the extent not theretofore paid (the sum of the amounts described in
clauses (1), (2), and (3) shall be hereinafter referred to as the “Accrued
Obligations”); and




     B. the amount equal to the product of (1) three and (2) the sum of (x) the
Executive’s Annual Base Salary and (y) the Executive’s target bonus under the
Company’s Management Incentive Plan, or any comparable bonus plan in which the
Executive participates and which has a target bonus generally similar to that in the
Company’s Management Incentive Plan (the “Target Bonus”), less amounts, if any, paid
to the Executive in accordance with the Company’s severance pay policies; and




     C. an amount equal to the excess of (a) the actuarial equivalent of the benefit
under the Company’s qualified defined benefit retirement plan (the “Retirement Plan”)
and any excess or supplemental retirement plan in which the Executive participates
(together, the “SERP”) (utilizing in each case actuarial assumptions no less favorable
to the Executive than those in effect under the Company’s Retirement Plan immediately
prior to the Effective Date), which the Executive would receive if the Executive’s
employment continued for three years after the Date of Termination assuming for this
purpose that all accrued benefits are fully vested, and, assuming that the Executive’s
compensation in each of the three years is equal to the Annual Base Salary as required
by Section 4(b)(i) and plus the Executive’s Target Bonus as described in Section
6(i)(B) for the most recent fiscal year (or other bonus amount considered pensionable
under the Retirement Plan), over (b) the actuarial equivalent of the Executive’s
actual benefit (paid or payable), if any, under the Retirement Plan and the SERP as of
the Date of Termination;




     D. an amount equal to the present value of the benefits to which the Executive
is entitled under the SERP as of the Date of Termination, utilizing (a) as a discount
rate the rate of return on 10-year Treasury Securities in effect for the month prior
to the month in which the Change of Control occurs, and (b) mortality assumptions
based on the Applicable Mortality Table defined in Section 417(e)(3)(A)(1) of the
Code; such amount shall be paid on the Executive’s Date of Termination; provided,
however, that this paragraph (D) shall be without effect if the Executive has elected
to receive distribution of benefits under the SERP in a form other than a lump sum
upon the Date of Termination.



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     (ii) for three years after the Executive’s Date of Termination, or such longer period
as may be provided by the terms of the appropriate plan, program, practice or policy, the
Company shall continue to provide the Welfare Benefits to the Executive and/or the
Executive’s family at least equal to those which would have been provided to them in
accordance with the plans, programs, practices and policies providing Welfare Benefits that
are described in Section 4(b)(iv) of this Agreement if the Executive’s employment had not
been terminated or, if more favorable to the Executive, as in effect generally at any time
thereafter with respect to other peer executives of the Company and its Affiliates and their
families, provided, however, that if the Executive becomes reemployed with another employer
and is eligible to receive medical or other Welfare Benefits under another employer provided
plan, the medical and other Welfare Benefits described herein shall be secondary to those
provided under such other plan during such applicable period of eligibility. For purposes of
determining eligibility (but not the time of commencement of benefits) of the Executive for
retiree benefits pursuant to such plans, practices, programs and policies, the Executive
shall be considered to have remained employed until three years after the Date of Termination
and to have retired on the last day of such period. The Company shall continue to make
available to the Executive health, medical, dental, and prescription drug benefits that are
Welfare Benefits at the Executive’s own cost until the Executive is eligible for coverage
under Medicare;




     (iii) the Company shall, at a maximum cost of 10% of the Executive’s Annual Base
Salary, provide the Executive with outplacement services the scope and provider of which
shall be selected by the Executive in his sole discretion; provided that in no event shall
the services covered by this paragraph (iii) be provided later than the last day of the
second calendar year following the calendar year in which the Date of Termination occurred,
with the reimbursement for such expenses to be paid no later than the end of the third
calendar year following the calendar year in which the Date of Termination occurred; and




     (iv) to the extent not otherwise paid or provided pursuant to this Agreement, the
Company shall pay or provide to the Executive the Other Benefits that may be due to him in
accordance with the terms of the arrangement providing for such amounts or benefits. The
term “Other Benefits” shall mean amounts or benefits to the extent that they are required to
be provided with respect to the Executive after termination of the Executive’s employment in
accordance with the terms of a plan, program, policy, practice, contract, agreement or other
arrangement; provided that “Other Benefits” will include only amounts and benefits that would
be required to be provided in the absence of this Agreement, except as otherwise expressly
provided in paragraphs (b) and (c) below with respect to Other Benefits.


Except as otherwise provided in paragraph (iv) above, in no event shall the Executive be entitled
to receive any benefits under this paragraph (a) (including amounts and rights provided under this
paragraph (a)) unless the Executive executes a release of claims against the Company and Affiliates
prepared by the Company and such release is not revoked. The Executive shall be eligible for
benefits under this paragraph (a) only if the release is returned by such time as is established by
the Company; provided that to the extent benefits provided pursuant to this paragraph (a) would
constitute Deferred Compensation, such benefits shall be paid or provided to the Executive only if
the release is returned in time to permit the distribution of such benefits to satisfy the
requirements of section 409A of the Code and further provided that to the extent that benefits are
intended to satisfy the short-term deferral exception to treatment as Deferred Compensation (as
provided in Treas. Reg. §1.409A-1(b)(4)), such benefits shall be paid to the Executive only if the
release is returned in time to permit distribution


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of benefits no later than the deadline for satisfying the requirements applicable to the short-term
deferral exception.




          (b) Death. If the Executive’s employment is terminated by reason of the Executive’s
death during the Employment Period, this Agreement shall terminate without further obligations to
the Executive’s legal representatives under this Agreement, other than for payment of Accrued
Obligations and the timely payment or provision of Other Benefits. Accrued Obligations shall be
paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 30 days
of the Date of Termination. With respect to the provision of Other Benefits, the term Other
Benefits as utilized in this Section 6(b) shall include, without limitation, and the Executive’s
estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most
favorable benefits provided by the Company and Affiliates to the estates and beneficiaries of peer
executives of the Company and such Affiliates under such plans, programs, practices and policies
relating to death benefits, if any, as in effect with respect to other peer executives and their
beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if
more favorable to the Executive’s estate and/or the Executive’s beneficiaries, as in effect on the
date of the Executive’s death with respect to other peer executives of the Company and its
Affiliates and their beneficiaries, with such death benefits to be made at the time and otherwise
in accordance with the terms specified by such plan, program, policy, or practice.




          (c) Disability. If the Executive’s employment is terminated by reason of the
Executive’s Disability during the Employment Period, this Agreement shall terminate without further
obligations to the Executive, other than for payment of Accrued Obligations and the timely payment
or provision of Other Benefits. Accrued Obligations shall be paid to the Executive in a lump sum
in cash within 30 days of the Date of Termination. With respect to the provision of Other
Benefits, the term Other Benefits as utilized in this Section 6(c) shall include, and the Executive
shall be entitled after the Disability Effective Date to receive, disability and other benefits at
least equal to the most favorable of those generally provided by the Company and its Affiliates to
disabled executives and/or their families in accordance with such plans, programs, practices and
policies relating to disability, if any, as in effect generally with respect to other peer
executives and their families at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive and/or the Executive’s family, as in effect
at any time thereafter generally with respect to other peer executives of the Company and its
Affiliates and their families.




          (d) Cause; Other than for Good Reason. If the Executive’s employment shall be
terminated for Cause during the Employment Period, this Agreement shall terminate without further
obligations to the Executive other than the obligation to pay to the Executive (x) his Annual Base
Salary through the Date of Termination, (y) the amount of any compensation previously deferred by
the Executive, and (z) Other Benefits, in each case to the extent theretofore unpaid. If the
Executive voluntarily terminates employment during the Employment Period, excluding a termination
for Good Reason, this Agreement shall terminate without further obligations to the Executive, other
than for Accrued Obligations and the timely payment or provision of Other Benefits. In such case,
all Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the
Date of Termination.




          (e) Specified Employee. If the Executive is a Specified Employee at the time of
termination of employment:




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(i) Payments of cash benefits under this Agreement that constitute Deferred Compensation may not be
paid before the date that is six months after the date of termination of employment or, if earlier,
the date of death of the Executive. At the end of the six-month period described in the preceding
sentence, amounts that could not be paid by reason of the limitation in this paragraph (i) shall be
paid on the first day of the seventh month following the date of termination of employment.



(ii) The provision of non-cash benefits (including, without limitation, life insurance, if any,
that is not treated as a “death benefit” under Treas. Reg. §1.409A-1) that constitute Deferred
Compensation will be provided to the Executive during the period ending six months after the date
of termination of employment or, if earlier, the date of death of the Executive only if the
Executive pays the cost of such coverage to the Company for that six month period; provided that
the Executive shall be reimbursed by the Company for the amount of such payment during the seventh
month after termination of employment.



For purposes of this Agreement, the term “Specified Employee” shall be defined in accordance with
Treas. Reg. §1.409A-1(i) and such rules as may be established by the Chief Executive Officer of the
Company or his or her delegate from time to time. For purposes of this Agreement, the term
“Deferred Compensation” means payments or benefits that would be considered to be provided under a
nonqualified deferred compensation plan as that term is defined in Treas. Reg. §1.409A-1.




          7. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the
Executive’s continuing or future participation in any plan, program, policy or practice (other than
those providing severance benefits) provided by the Company or any of its Affiliates and for which
the Executive may qualify, nor, subject to Section 12(f), shall anything herein limit or otherwise
affect such rights as the Executive may have under any contract or agreement with the Company or
any of its Affiliates. Amounts which are vested benefits or which the Executive is otherwise
entitled to receive under any plan, policy, practice or program of or any contract or agreement
with the Company or any of its Affiliates at or subsequent to the Date of Termination shall be
payable in accordance with such plan, policy, practice or program or contract or agreement except
as explicitly modified by this Agreement.




          8. Full Settlement. (a) The Company’s obligation to make the payments provided for
in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may
have against the Executive or others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable to the Executive
under any of the provisions of this Agreement and such amounts shall not be reduced whether or not
the Executive obtains other employment. The Company agrees to pay as incurred, to the full extent
permitted by law, all legal fees and expenses which the Executive may incur as a result of any
contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity
or enforceability of, or liability under, any provision of this Agreement or any guarantee of
performance thereof (including as a result of any contest by the Executive about the amount of any
payment pursuant to this Agreement), plus in each case interest on any delayed payment at the
applicable Federal rate provided for in section 7872(f)(2)(A) of the Code. If, however, following
the conclusion of such contest, the court before whom such contest was held determines that under
the circumstances it was unjust for the Company to have paid all or any part of the legal fees and
expenses of the Executive pursuant to the immediately preceding sentence, the Executive shall repay
any such payments to the Company in accordance with the order of the court.




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          (b) The right of the Executive (including the estate of the Executive) to amounts under this
Section 8 shall continue during the life of the Executive (and the life of any beneficiary claiming
with respect to the Executive by reason of this Section 8). Payment by the Company under this
Section 8 shall be made promptly after the Executive submits reasonable evidence of his having
incurred the amounts subject to payment, provided that the Executive shall be required to provide
such evidence no later than October 31 of the calendar year following the year in which such
expenses are incurred (or such later date permitted by the Company that is not later than the end
of the calendar year following the year in which such expenses are incurred), and shall be paid by
the Company not later than the last day of the calendar year following the year in which such
expenses are incurred. The foregoing provisions of this Section (b) are intended to conform the
payments under this Section 8 to the requirements of Code section 409A, and shall not be construed
to permit delay by the Company of payment of amounts due earlier in accordance with in this Section
8.




          9. Certain Additional Payments by the Company.




          (a) Anything in this Agreement to the contrary notwithstanding and except as set forth below,
in the event it shall be determined that any payment or distribution by the Company or its
affiliates to or for the benefit of the Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise, but determined without regard
to any additional payments required under this Section 9) (a “Payment”) would be subject to the
excise tax imposed by section 4999 of the Code or any interest or penalties are incurred by the
Executive with respect to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the “Excise Tax”), then the Executive shall
be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after
payment by the Executive of all taxes (including any interest or penalties imposed with respect to
such taxes), including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments.
Notwithstanding the foregoing provisions of this Section 9(a), if it shall be determined that the
Executive is entitled to a Gross-Up Payment, but that the Payments do not exceed 110% of the
greatest amount (the “Reduced Amount”) that could be paid to the Executive such that the receipt of
Payments would not give rise to any Excise Tax, then no Gross-Up Payment shall be made to the
Executive and the Payments, in the aggregate, shall be reduced to the Reduced Amount. The
reduction of the Payments to the Reduced Amount shall be made by reducing the cash amounts of
Payments (excluding Welfare Benefits) that would not constitute Deferred Compensation (with the
Payments subject to such reduction to be determined by the Executive), to the extent necessary to
decrease the Payments to the Reduced Amount.




          (b) Subject to the provisions of Section 9(c), all determinations required to be made under
this Section 9, including whether and when a Gross-Up Payment is required and the amount of such
Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be
made by Ernst & Young LLP or such other certified public accounting firm as may be designated by
the Executive (the “Accounting Firm”) which shall provide detailed supporting calculations both to
the Company and the Executive within 15 business days of the receipt of notice from the Executive
that there has been a Payment, or such earlier time as is requested by the Company. In the event
that the Accounting Firm is serving as accountant or auditor for the individual, entity or group
effecting the Change of Control, the Executive shall appoint another nationally recognized
accounting firm to make the determinations required hereunder (which accounting firm shall then be
referred to as the Accounting Firm hereunder).




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All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up
Payment, as determined pursuant to this Section 9, shall be paid by the Company to the Executive
within five days of the receipt of the Accounting Firm’s determination. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As a result of the
uncertainty in the application of Section 4999 of the Code at the time of the initial determination
by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been
made by the Company should have been made (“Underpayment”), consistent with the calculations
required to be made hereunder. In the event that the Company exhausts its remedies pursuant to
Section 9(c) and the Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for the benefit of the Executive.




          (c) The Executive shall notify the Company in writing of any claim by the Internal Revenue
Service that, if successful, would require the payment by the Company of the Gross-Up Payment.
Such notification shall be given as soon as practicable but no later than ten business days after
the Executive is informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The Executive shall not pay
such claim prior to the expiration of the 30-day period following the date on which it gives such
notice to the Company (or such shorter period ending on the date that any payment of taxes with
respect to such claim is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive shall:





     (i) give the Company any information reasonably requested by the Company relating to
such claim,




     (ii) take such action in connection with contesting such claim as the Company shall
reasonably request in writing from time to time, including, without limitation, accepting
legal representation with respect to such claim by an attorney reasonably selected by the
Company,




     (iii) cooperate with the Company in good faith in order effectively to contest such
claim, and




     (iv) permit the Company to participate in any proceedings relating to such claim;


provided, however, that the Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and shall indemnify and
hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such representation and payment
of costs and expenses. Without limitation on the foregoing provisions of this Section 9(c), the
Company shall control all proceedings taken in connection with such contest and, at its sole
option, may pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its sole option, either
direct the Executive to pay the tax claimed and sue for a refund or contest the claim in any
permissible manner, and the Executive agrees to prosecute such contest to a determination before
any administrative tribunal, in a court of initial jurisdiction and in one or more appellate
courts, as the Company shall determine; provided, however, that if the Company directs the
Executive to pay such claim and sue for a refund, the Company shall advance the amount of such
payment to the Executive, on an interest-free basis and shall


13









 






indemnify and hold the Executive harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to such advance or with
respect to any imputed income with respect to such advance; and further provided that any extension
of the statute of limitations relating to payment of taxes for the taxable year of the Executive
with respect to which such contested amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company’s control of the contest shall be limited to issues
with respect to which a Gross-Up Payment would be payable hereunder and the Executive shall be
entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.




          (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to
Section 9(c), the Executive becomes entitled to receive any refund with respect to such claim, the
Executive shall (subject to the Company’s complying with the requirements of Section 9(c)) promptly
pay to the Company the amount of such refund (together with any interest paid or credited thereon
after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by
the Company pursuant to Section 9(c), a determination is made that the Executive shall not be
entitled to any refund with respect to such claim and the Company does not notify the Executive in
writing of its intent to contest such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and shall not be required to be repaid and
the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment
required to be paid.




          (e) Gross-Up Payments by the Company under this Section 9 with respect to taxes paid by the
Executive shall be made no later than the end of the calendar year following the calendar year in
which the taxes are remitted to the taxing authority. Any other payments or reimbursements due
under this Section 9 shall be made promptly after the Executive submits reasonable evidence of his
having incurred the amounts subject to payment, provided that the Executive shall be required to
provide such evidence no later than October 31 of the calendar year following the year in which
such expenses are incurred (or such later date permitted by the Company that is not later than the
end of the calendar year following the year in which such expenses are incurred), and shall be paid
by the Company not later than the last day of the calendar year following the year in which such
expenses are incurred. The foregoing provisions of this Section (e) are intended to conform the
payments under this Section 9 to the requirements of Code section 409A, and shall not be construed
to permit delay by the Company of payment of amounts due earlier in accordance with this Section 9.




          10. Post-Termination Protections for Company. (a) Confidentiality. The
Executive acknowledges that in the course of the Executive’s involvement in the activities of the
Company and its Affiliates, the Executive will have access to confidential and proprietary
information including, but not limited to, the Company’s business affairs, financial and strategic
plans, customers, vendors, finances, methods of operation, proprietary computer programs, business
dealings, assets, capabilities, and all other planning, pricing, customer or client lists of the
Company and its Affiliates whether written, oral or otherwise. The Executive agrees that, before,
on, and after the Effective Date, the Executive shall keep confidential all information, knowledge
or data relating to the Company or any of its Affiliates, and their respective businesses, which
shall have been obtained by the Executive during the Executive’s employment by the Company or any
of its Affiliates and which shall have been identified and held by the Company as proprietary and
confidential and which shall not be or become public knowledge (other than by acts by the Executive
or representatives of the Executive in violation of this Agreement). During and after termination
of the Executive’s employment with the Company, the Executive shall not, without the express
written consent of the Lead Director of



14









 






the Company or as may otherwise be required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than the Company. In no event shall an
asserted violation of the provisions of this Section 10 constitute a basis for deferring or
withholding any amounts otherwise payable to the Executive under this Agreement.




          (b) Competition. The Executive agrees that, while employed by the Company and, if
the Executive’s Date of Termination occurs during the Employment Period for any reason, during the
twelve month period after the Executive’s Date of Termination, the Executive shall not, without the
express written consent of the Lead Director of the Company be employed by, serve as a consultant
to, or otherwise assist or directly or indirectly provide services to a Competitor in any location
in the United States. The term “Competitor” means any enterprise (including a person, firm,
business, division, or other unit, whether or not incorporated) during any period in which it is
engaged in the business of leasing railcar assets. Nothing contained herein will prevent the
Executive from engaging in an activity otherwise prohibited by this paragraph (b) for or with
respect to any subsidiary, division or affiliate or unit (each, a “Unit”) of an entity if that Unit
is not engaged in railcar leasing irrespective of whether another Unit of such entity engages in
such competition (as long as the Executive does not engage in prohibited activity for such other
Unit).




          (c) Solicitation of Customers or Suppliers. The Executive agrees that, while
employed by the Company and, if the Executive’s Date of Termination occurs during the Employment
Period for any reason, during the twelve month period after the Executive’s Date of Termination,
the Executive shall not, without the express written consent of the Lead Director of the Company
call on, service or solicit any party who is then or, during the twelve-month period prior to such
solicitation by the Executive was a customer or supplier of the Company or Affiliate, provided that
the restriction in this paragraph (c) shall not apply to any activity on behalf of a business that
is not a Competitor.




          (d) Solicitation of Employees. The Executive agrees that, while employed by the
Company and, if the Executive’s Date of Termination occurs during the Employment Period for any
reason, during the twelve month period after the Executive’s Date of Termination, the Executive
shall not, solicit, entice, persuade or induce any individual who is employed by the Company or the
Affiliates (or was so employed within 90 days prior to the Executive’s action) to terminate or
refrain from renewing or extending such employment or to become employed by or enter into
contractual relations with any other individual or entity other than the Company or the Affiliates,
and the Executive shall not approach any such employee for any such purpose or authorize or
knowingly cooperate with the taking of any such actions by any other individual or entity.




          (e) Judicial Amendment. It is expressly understood and agreed that although the
Executive and the Company consider the restrictions contained in this paragraph 10 to be
reasonable, if a final judicial determination is made by a court of competent jurisdiction that the
time or territory or any other restriction contained in this Agreement is an unenforceable
restriction against the Executive, the provisions of this Agreement shall not be rendered void but
shall be deemed amended to apply as to such maximum time and territory and to such maximum extent
as such court may judicially determine or indicate to be enforceable. Alternatively, if any court
of competent jurisdiction finds that any restriction contained in this Agreement is unenforceable,
and such restriction cannot be amended so as to make it enforceable, such finding shall not affect
the enforceability of any of the other restrictions contained herein.




15









 








          (f) Equitable Remedies. The Executive acknowledges that the Company would be
irreparably injured by a violation of this paragraph 10, and agrees that the Company, in addition
to any other remedies available to it for such breach or threatened breach, shall be entitled to a
preliminary injunction, temporary restraining order, or other equivalent relief, restraining the
Executive from any actual or threatened breach of paragraph 10. If a bond is required to be posted
in order for the Company to secure an injunction or other equitable remedy, the parties agree that
said bond need not be more than a nominal sum.




          (g) Duty of Loyalty. Nothing in this paragraph 10 shall be construed as limiting the
Executive’s duty of loyalty to the Company, or any other duty the Executive may otherwise have to
the Company, while is employed by the Company.




          11. Successors. (a) This Agreement is personal to the Executive and without the
prior written consent of the Company shall not be assignable by the Executive otherwise than by
will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be
enforceable by the Executive’s legal representatives.




          (b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.




          (c) The Company will require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or assets of the
Company to assume expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession had taken place. The
Company agrees that it will not effect the sale or other disposition of all or substantially all of
its assets unless either (1) the person or entity acquiring the assets or a substantial portion of
the assets shall expressly assume by an instrument in writing all duties and obligations of the
Company under this Agreement or (2) the Company shall provide through the establishment of a
separate reserve for the payment in full of all amounts that are or may be reasonably expected to
become payable to the Executive under this Agreement. As used in this Agreement, “Company” shall
mean the Company as herein before defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.




          12. Miscellaneous. (a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois, without reference to principles of conflict of
laws. The captions of this Agreement are not part of the provisions hereof and shall have no force
or effect. This Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and legal representatives. No
amendment, modification, or termination of this Agreement shall be adopted or effective if it would
result in accelerated recognition of income or imposition of additional tax under Code section
409A.




          (b) All notices and other communications hereunder shall be in writing and shall be given by
hand delivery to the other party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:




16









 







If to the Executive:



Brian A. Kenney



If to the Company:



GATX Corporation

222 West Adams Street

Chicago, IL 60606-5314



Attention: Senior Vice-President, Human Resources



or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received by the addressee.




          (c) The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.




          (d) The Company may withhold from any amounts payable under this Agreement such Federal,
state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or
regulation.




          (e) The Executive’s or the Company’s failure to insist upon strict compliance with any
provision of this Agreement or the failure to assert any right the Executive or the Company may
have hereunder, including, without limitation, the right of the Executive to terminate employment
for Good Reason pursuant to Section 5(c)(i)-(vi) of this Agreement, shall not be deemed to be a
waiver of such provision or right or any other provision or right of this Agreement.




          (f) This Agreement supercedes and replaces the Agreement between the Executive and the
Company dated August 6, 2004.




          (g) The Executive and the Company acknowledge that, except as may otherwise be provided under
any other written agreement between the Executive and the Company, the employment of the Executive
by the Company is “at will” and, subject to Section 1(a) hereof, prior to the Effective Date, the
Executive’s employment and/or this Agreement may be terminated by either the Executive or the
Company at any time prior to the Effective Date, in which case the Executive shall have no further
rights under this Agreement. From and after January 1, 2009, this Agreement shall supersede any
other agreement between the parties with respect to the subject matter hereof.




17









 








          IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from its Board of Directors, the Company has caused these presents to be executed in
its name on its behalf, all as of the Execution Date set forth below.




	 	 	 	 	 
	 	 	 	 
	 	Executive
 	 
	 	 	 
	 
	 	GATX CORPORATION

 	 
	 	By:  	 	 
	 	 	Its Senior Vice President, General Counsel & Secretary 	 
	 
	 	 	 	 
	 	Execution Date
 	 
	 




18