Document:

Exh 10.16.1 12.31.2013

EXHIBIT 10.16.1                                                          
       EXECUTION COPY

                     PARTICIPATION AGREEMENT (TRLIV 2004-1A)

                           Dated as of August 19, 2004

                                      among

                          TRINITY RAIL LEASING IV L.P.,

                                   as Lessee,

                         TRINITY RAIL LEASING TRUST II,

                       TRINITY INDUSTRIES LEASING COMPANY,

                                   as Manager,

                            TRINITY INDUSTRIES, INC.,

                     TRLIV 2004-1A RAILCAR STATUTORY TRUST,

                      U.S. BANK TRUST NATIONAL ASSOCIATION,
                                as Owner Trustee,

                        THE FIFTH THIRD LEASING COMPANY,
                              as Owner Participant

                          AMBAC ASSURANCE CORPORATION,

                               as Policy Provider

                                       and

                            WILMINGTON TRUST COMPANY,
                  as Indenture Trustee and Pass Through Trustee

                           Tank Cars and Freight Cars

Table of Contents

Page
                                                                                                               ----

SECTION 1.       DEFINITIONS; INTERPRETATION OF THIS AGREEMENT............................................      3

SECTION 2.       SALE AND PURCHASE; PARTICIPATION IN EQUIPMENT COST; CLOSING; TRANSACTION COSTS...........      3
  Section 2.1    Sale and Purchase of Equipment...........................................................      3
  Section 2.2    Participation in Equipment Cost..........................................................      4
  Section 2.3    Closing Date; Procedure for Participation................................................      4
  Section 2.4    Owner Participant's Instructions to the Owner Trustee; Satisfaction of
                 Conditions...............................................................................      5
  Section 2.5    Expenses.................................................................................      6
  Section 2.6    Calculation of Adjustments to Basic Rent, Stipulated Loss Value and
                 Termination Value; Confirmation and Verification.........................................      9
  Section 2.7    Postponement of Closing Date.............................................................     11

SECTION 3.       REPRESENTATIONS AND

WARRANTIES...........................................................     13
  Section 3.1    Representations and Warranties of the Trust Company......................................     13
  Section 3.2    Representations and Warranties of the Lessee.............................................     15
  Section 3.3    Representations and Warranties of the Indenture Trustee..................................     22
  Section 3.4    Representations, Warranties and Covenants Regarding Beneficial
                 Interest, Equipment Note and Pass Through Certificates...................................     23
  Section 3.5    Representations and Warranties of the Owner Participant..................................     25
  Section 3.6    Representations and Warranties of TILC...................................................     27
  Section 3.7    Representations and Warranties of TRLTII.................................................     31
  Section 3.8    Representations and Warranties of the Pass Through Trustee...............................     32
  Section 3.9    Representations and Warranties of Trinity................................................     34
  Section 3.10   Representations and Warranties of the Policy Provider....................................     35
  Section 3.11   Opinion Acknowledgment...................................................................     36

SECTION 4.       CLOSING CONDITIONS.......................................................................     36
  Section 4.1    Conditions Precedent to Investment by Each Participant...................................     36
  Section 4.2    Additional Conditions Precedent to Investment by the Loan Participant....................     42
  Section 4.3    Additional Conditions Precedent to Investment by the Owner Participant...................     43
  Section 4.4    Conditions Precedent to the Obligation of TRLTII and the Lessee..........................     44

SECTION 5.       FINANCIAL AND OTHER REPORTS OF THE LESSEE, TILC AND TRINITY..............................     45

SECTION 6.       CERTAIN COVENANTS OF THE PARTICIPANTS, THE TRUSTEES AND THE LESSEE.......................     46
  Section 6.1    Restrictions on Transfer of Beneficial Interest..........................................     46

i

Table of Contents
                                   (continued)

Page
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  Section 6.2    Lessor's Liens Attributable to the Owner Participant.....................................     49
  Section 6.3    Lessor's Liens Attributable to Trust Company.............................................     49
  Section 6.4    Liens Created by the Indenture Trustee and the Loan Participant..........................     50
  Section 6.5    Covenants of Owner Trustee, Owner Participant and Indenture Trustee......................     50
  Section 6.6    Information..............................................................................     51
  Section 6.7    Certain Representations, Warranties and Covenants........................................     51
  Section 6.8    Covenants of the Manager.................................................................     51
  Section 6.9    Lessee's Purchase in Certain Circumstances...............................................     51
  Section 6.10   Owner Participant as Affiliate of Lessee.................................................     53
  Section 6.11   Records; U.S. Income Tax Information.....................................................     53
  Section 6.12   Mexico Filings...........................................................................     54
  Section 6.13   Certain Releases.........................................................................     56
  Section 6.14   Waiver, Amendment or Modification of Operative Agreements................................     57

SECTION 7.       LESSEE'S INDEMNITIES.....................................................................     57
  Section 7.1    General Tax Indemnity....................................................................     57
  Section 7.2    General Indemnification..................................................................     68
  Section 7.3    Indemnification by TILC..................................................................     74
  Section 7.4    Special Indemnification Regarding Exercise of Setoff by Customers........................     77

SECTION 8.       LESSEE'S RIGHT OF QUIET ENJOYMENT........................................................     77

SECTION 9.       SUCCESSOR INDENTURE TRUSTEE..............................................................     77

SECTION 10.      MISCELLANEOUS............................................................................     77
  Section 10.1   Consents.................................................................................     77
  Section 10.2   Refinancing..............................................................................     78
  Section 10.3   Amendments and Waivers...................................................................     80
  Section 10.4   Notices..................................................................................     80
  Section 10.5   Survival.................................................................................     82
  Section 10.6   No Guarantee of Residual Value or Debt...................................................     82
  Section 10.7   Successors and Assigns...................................................................     82
  Section 10.8   Business Day.............................................................................     83
  Section 10.9   GOVERNING LAW............................................................................     83
  Section 10.10  Severability.............................................................................     83
  Section 10.11  Counterparts.............................................................................     83
  Section 10.12  Headings and Table of Contents...........................................................     83
  Section 10.13  Limitations of Liability; Extent of Interest.............................................     83
  Section 10.14  Maintenance of Non-Recourse Debt.........................................................     84
  Section 10.15  Ownership of and Rights in Units and Pledged Units.......................................     85
  Section 10.16  No Petition..............................................................................     85
  Section 10.17  Consent To Jurisdiction..................................................................     86

ii

Table of Contents
                                   (continued)

Page
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  Section 10.18  WAIVER OF JURY TRIAL.....................................................................     86
  Section 10.19  No Partnership Created...................................................................     86
  Section 10.20  Amendments to Operative Agreements That Are Not Lessee Agreements........................     87
  Section 10.21  Acknowledgment of Confidentiality Provisions in Subleases................................     87

SECTION 11.      LIMITED GUARANTY.........................................................................     87
  Section 11.1   Limited Guaranty.........................................................................     87
  Section 11.2   Guaranty Unconditional...................................................................     88
  Section 11.3   Discharge Only Upon Payment and Performance in Full; Reinstatement in
                 Certain Circumstances....................................................................     90
  Section 11.4   Waiver by Trinity........................................................................     90
  Section 11.5   Subrogation..............................................................................     90
  Section 11.6   Payments.................................................................................     90
  Section 11.7   Withholding Taxes........................................................................     90

iii

EXHIBITS AND SCHEDULES

Exhibit A-1   --  Form of Certificate of Insurance Broker Confirming Insurance
                  Coverage (Primary Liability)
Exhibit A-2   --  Form of Certificate of Insurance Broker Confirming Insurance
                  Coverage (Excess Liability)
Exhibit B-1   --  Insurance Requirements as to Public Liability Insurance
Exhibit B-2   --  Insurance Requirements as to Physical Damage Insurance
Exhibit C     --  Form of Transfer Agreement
Exhibit D     --  Form of Notice of Assignment of Sublease
Exhibit E-1   --  Form of Winston & Strawn LLP Opinion
Exhibit E-2   --  Form of Trinity Rail Leasing IV L.P. and Trinity Industries
                  Leasing Company Opinion
Exhibit E-3   --  Form of Shipman and Goodwin LLP Opinion
Exhibit E-4   --  Form of Simpson Thacher & Bartlett LLP Opinion
Exhibit E-5   --  Form of Owner Participant in-house counsel Opinion
Exhibit E-6   --  Form of Morris, James, Hitchens & Williams LLP Opinion, as
                  special counsel for the Indenture Trustee, Collateral Agent
                  and Pass Through Trustee
Exhibit E-7   --  Form of Alvord & Alvord Opinion
Exhibit E-8   --  Form of Blake Cassels Opinion
Exhibit E-9   --  Form of Policy Provider in-house counsel Opinion
Exhibit E-10  --  Form of Haynes & Boone, LLP Opinion
Exhibit F     --  Form of Officer's Solvency Certificate
Exhibit G     --  Tax Shelter Registration Form
Schedule 1-A  --  Description of Equipment, Designation of Basic Groups,
                  Designation of Functional Groups and Equipment Cost
Schedule 1-B      Description of Pledged Equipment
Schedule 1-C  --  List of Existing Subleases
Schedule 1-D      List of Existing Pledged Equipment Leases
Schedule 2    --  Commitment Percentage and Payment Information for
                  Participants
Schedule 3-A  --  Schedule of Basic Rent Payments
Schedule 3-B  --  Basic Rent Allocation Schedule
Schedule 4-A  --  Schedule of Stipulated Loss Value and Termination Value
Schedule 4-B  --  Termination Amount Schedule
Schedule 5    --  Terms of Equipment Note
Schedule 6    --  Purchase Information
Schedule 7-A  --  List of Units Subject to a Purchase Option
Schedule 7-B  --  List of Units Subject to a Purchase Option Not for Fair
                  Market Value
Schedule 8    --  Permitted Liens
Schedule 9    --  List of Subleases and Pledged Equipment Leases Not in
                  Conformity with Permitted Sublease Definition

                                     iv

PARTICIPATION AGREEMENT (TRLIV 2004-1A)

      This PARTICIPATION AGREEMENT (TRLIV 2004-1A), dated as of August 19, 2004
(this "Agreement"), is by and among (i) Trinity Rail Leasing IV L.P., a Texas
limited partnership (together with its permitted successors and assigns, the
"Lessee" or the "Partnership"), (ii) Trinity Rail Leasing Trust II, a Delaware
statutory trust ("TLRTII"), (iii) Trinity Industries Leasing Company, a Delaware
corporation ("TILC"), (iv) Trinity Industries, Inc., a Delaware corporation
("Trinity"), (v) TRLIV 2004-1A Railcar Statutory Trust, a Connecticut statutory
trust (the "Trust"), (vi) U.S. Bank Trust National Association, ("Trust
Company"), not in its individual capacity except as expressly provided herein
but solely as trustee (together with its permitted successors and assigns, the
"Owner Trustee") under the Trust Agreement (such term and other defined terms
used herein shall have the meanings assigned thereto in Section 1 below), (vi)
The Fifth Third Leasing Company, an Ohio corporation (together with its
permitted successors and assigns, the "Owner Participant"), (vii) Ambac
Assurance Corporation, a Wisconsin stock insurance corporation, and (viii)
Wilmington Trust Company, a Delaware banking corporation, not in its individual
capacity except as expressly provided herein but solely as pass through trustee
under the Pass Through Trust Agreement (in such capacity, together with its
permitted successors and assigns, the "Pass Through Trustee" or the "Loan
Participant"), and as trustee under the Indenture (in such capacity, together
with its permitted successors and assigns, the "Indenture Trustee"). The Owner
Participant and the Loan Participant are sometimes hereinafter referred to
collectively as the "Participants."

                                   WITNESSETH:

      WHEREAS, on or prior to the date hereof, the Owner Participant and the
Trust Company have entered into the Trust Agreement pursuant to which the Owner
Trustee has agreed, among other things, to hold the Trust Estate for the benefit
of the Owner Participant thereunder on the terms specified in the Trust
Agreement, subject, however, to the Lien created under the Indenture and,
subject to the terms and conditions hereof, (i) to purchase from the Lessee on
the Closing Date the Equipment described in Schedule 1-A hereto and (ii) to
acquire Equipment from time to time in connection with the substitution or
replacement of Units described in Schedule 1-A hereto in accordance with the
Lease and, in each case, to lease such Equipment to the Lessee concurrently with
such purchase or acquisition;

      WHEREAS, on or prior to the date hereof and pursuant to the Pass Through
Trust Agreement, a trust intended to constitute a grantor trust for U.S.
federal, state, and local income tax purposes was created to facilitate the
financing contemplated hereby;

      WHEREAS, on the Closing Date, the Trust and the Indenture Trustee will
enter into the Indenture, pursuant to which the Trust will agree, among other
things, to borrow from the Loan Participant an amount not to exceed the lesser
of $60,387,016.34 and 80% of the Total Equipment Cost in connection with the
financing of the Total Equipment Cost and to issue to the Loan Participant the
Equipment Note as evidence of such loan;

      WHEREAS, TRLTII, an indirect wholly-owned subsidiary of TILC, will on the
Closing Date, pursuant to the Transfer and Assignment Agreement (i) sell to the
Lessee all of TRLTII's right, title and interest in and to the Equipment
described on Schedule 1-A hereto and (ii) assign

and transfer to the Lessee all of TRLTII's right, title and interest in and to
any Existing Equipment Subleases;

      WHEREAS TRLTII will, on the Closing Date, pursuant to the Pledged
Equipment Transfer and Assignment Agreement (i) sell to the Partnership all of
TRLTII's right, title and interest in and to the Pledged Equipment and (ii)
assign and transfer to the Partnership all of TRLTII's right, title and interest
in and to any Existing Pledged Equipment Leases;

      WHEREAS, pursuant to the terms of the Trust Agreement, the Owner
Participant has authorized and directed the Owner Trustee to, on behalf of the
Trust, and the Trust will, among other things (and subject to the terms and
conditions of the Operative Agreements), (i) purchase the Equipment described in
Schedule 1-A hereto from the Lessee and accept delivery from the Lessee of the
Bill of Sale evidencing the purchase and transfer of title of each Unit to the
Trust, (ii) acquire Equipment from time to time in connection with the
substitution or replacement of Units in accordance with the Lease, (iii) own the
Equipment described in Schedule 1-A hereto as provided in the Operative
Agreements, (iv) accept pursuant to the Assignment the assignment and transfer
from the Lessee of all Lessee's right, title and interest in and to the Existing
Equipment Subleases and (v) execute and deliver the Lease, pursuant to which,
subject to the terms and conditions set forth therein, the Trust agrees to lease
to the Lessee, and the Lessee agrees to lease from the Trust, each Unit to be
delivered on the Closing Date, such lease to be evidenced by the execution and
delivery of the Lease Supplement covering such Units;

      WHEREAS, concurrently with the execution and delivery of this Agreement,
the Lessee, TILC, the Trust, the Owner Trustee, the Indenture Trustee, the
Collateral Agent and the other parties thereto have entered into the Collateral
Agency Agreement, pursuant to which the Lessee will agree, among other things,
to grant to the Collateral Agent for the security and the benefit of the Owner
Trust and the other Beneficiaries (as defined therein) a security interest in
the Collateral (including the Subleases and Pledged Equipment Leases) to secure
the performance by the Lessee of its obligations under the Partnership Documents
and Operative Agreements (including the Lease) to which the Lessee is a party;

      WHEREAS, pursuant to the terms of the Trust Agreement, the Owner
Participant has authorized and directed the Owner Trustee to, on behalf of the
Trust, and the Trust will, among other things (and subject to the terms and
conditions of the Operative Agreements), grant to the Indenture Trustee under
the Indenture for the security and the benefit of the holder of the Equipment
Note a security interest in the Indenture Estate;

      WHEREAS, concurrently with the execution and delivery of this Agreement,
Lessee, TILC and the Owner Participant (or an Affiliate of the Owner
Participant) will enter into the Tax Indemnity Agreement;

      WHEREAS, the proceeds from the sale of the Equipment Note to the Loan
Participant will be applied, together with the equity contribution made by the
Owner Participant in an amount not less than 20% of the Total Equipment Cost
pursuant to this Agreement and the Trust Agreement, to effect the purchase of
the Equipment described on Schedule 1-A hereto by the Trust from the Lessee as
contemplated hereby;

                                       2

WHEREAS, on or prior to the Closing Date, the Partners made capital
contributions to the Lessee in accordance with the Partnership Agreement and on
the Closing Date all of the proceeds of such capital contributions will be
applied (i) to effect the purchase of the Pledged Equipment by the Lessee from
TRLTII as contemplated hereby and (ii) to fund certain reserve accounts of the
Lessee as contemplated hereby and by the Collateral Agency Agreement;

      WHEREAS, concurrently with the execution and delivery of this Agreement,
the Lessee and TILC have entered into the Management Agreement, pursuant to
which TILC will provide management services with respect to the Equipment, the
Pledged Equipment, the Subleases and the Pledged Equipment Leases;

      WHEREAS, concurrently with the execution and delivery of this Agreement,
the Lessee and TILC have entered into the Insurance Agreement, pursuant to which
TILC will provide services to the Lessee in connection with obtaining, managing
and maintaining insurance with respect to the Equipment and the Pledged
Equipment required under the Operative Agreements; and

      WHEREAS, concurrently with the execution and delivery of this Agreement,
the Lessee, the General Partner, the Limited Partner and TILC have entered into
the Administrative Services Agreement, pursuant to which TILC will provide
certain administrative services with respect to the Partnership, the General
Partner and the Limited Partner.

      NOW, THEREFORE, in consideration of the mutual agreements herein contained
and other good and valuable consideration, receipt of which is acknowledged, the
parties hereto agree as follows:

SECTION 1. DEFINITIONS; INTERPRETATION OF THIS AGREEMENT.

      Unless otherwise defined herein or unless the context shall otherwise
require, capitalized terms used in this Agreement shall have the meanings
assigned to such terms in Appendix A to the Equipment Lease Agreement (TRLIV
2004-1A), dated as of August 19, 2004, between the Trust and the Lessee. Unless
otherwise indicated, all references herein to Sections, Schedules and Exhibits
refer to Sections, Schedules and Exhibits of this Agreement.

SECTION 2. SALE AND PURCHASE; PARTICIPATION IN EQUIPMENT COST; CLOSING;
           TRANSACTION COSTS.

      Section 2.1 Sale and Purchase of Equipment. Subject to the terms and
conditions hereof and on the basis of the representations and warranties set
forth herein, the Lessee agrees to sell to the Trust, and the Trust agrees to
purchase from the Lessee, on the Closing Date and immediately following
consummation of the transactions described in the third and fourth recital
clauses above, the Equipment described in Schedule 1-A, and, in connection
therewith, the Trust agrees to pay to the Lessee the cost for each Unit as
specified in Schedule 1-A. On the Closing Date, the Lessee shall deliver each
Unit described on Schedule 1-A to the Trust, and the Trust shall accept such
delivery.

                                       3

Section 2.2 Participation in Equipment Cost.

            (a) Equity Participation. On the Closing Date, subject to the terms
and conditions hereof and on the basis of the representations and warranties set
forth herein, the Owner Participant agrees to participate in the payment of the
Total Equipment Cost for the Units delivered on the Closing Date by making an
equity investment in the beneficial ownership of such Units in the amount equal
to the product of the Total Equipment Cost for such Units delivered on the
Closing Date and the percentage (not less than 20%) set forth opposite the Owner
Participant's name in Schedule 2 (the "Owner Participant's Commitment"). The
aggregate amount of the Owner Participant's Commitment plus the aggregate amount
of Transaction Costs payable by the Owner Participant shall not exceed the sum
of (x) the Owner Participant's Commitment and (y) 2.60% of the Total Equipment
Cost. The Owner Participant's Commitment shall be paid to the Indenture Trustee
to be held (but not as part of the Indenture Estate) and applied on behalf of
the Owner Trustee toward payment of the Total Equipment Cost as provided in
Section 2.3.

            (b) Debt Participation. On the Closing Date, subject to the terms
and conditions hereof and on the basis of the representations and warranties set
forth herein, the Loan Participant agrees to participate in the payment of the
Total Equipment Cost for the Units delivered on the Closing Date by making a
secured loan, not from its own funds but solely from the Consideration (as
defined in the Pass Through Trust Agreement) received by it from the sale of the
Pass Through Trust Certificates, to be evidenced by the Equipment Note, to the
Trust, in the amount equal to the product of the Total Equipment Cost for the
Units delivered on the Closing Date and the percentage (not in excess of 80%)
set forth opposite the Loan Participant's name in Schedule 2 (the "Loan
Participant's Commitment"). The Equipment Note shall bear interest at the Debt
Rate.

      Section 2.3 Closing Date; Procedure for Participation.

            (a) Notice of Closing Date. Not later than three Business Days prior
to the Closing Date (or such lesser notice as may be agreed upon by the Lessee,
the Owner Participant and the Loan Participant), the Lessee shall give the Owner
Participant, the Indenture Trustee, the Trust, the Owner Trustee, the Policy
Provider and the Loan Participant a notice (a "Notice of Delivery") by facsimile
or other form of telecommunication or telephone (to be promptly confirmed in
writing) of the Closing Date, which Notice of Delivery shall specify in
reasonable detail the number and type of Units to be delivered on such date, the
Total Equipment Cost of such Units, and the respective amounts of the Owner
Participant's Commitment and the Loan Participant's Commitment required to be
paid with respect to the Units. Prior to 11:00 a.m., Chicago time, on the
Closing Date, subject to the satisfaction (or waiver) of the respective
conditions specified in Section 4, the Owner Participant shall make the amount
of the Owner Participant's Commitment required to be paid on the Closing Date
available to the Indenture Trustee, and immediately prior to the delivery and
acceptance of the Units as specified in Section 2.3(b), the Loan Participant
shall make the amount of the Loan Participant's Commitment for the Total
Equipment Cost required to be paid on the Closing Date available to the
Indenture Trustee, in either case, by transferring or delivering such amounts,
in funds immediately available on the Closing Date, to the Indenture Trustee,
either directly to, or for deposit in, the Indenture Trustee's account at
Wilmington Trust Company, ABA No. 031100092, Attn: Rob Perkins, Account

                                       4

067435-000. The making available by the Owner Participant of the amount of the
Owner Participant's Commitment for the Total Equipment Cost shall be deemed a
waiver of the Notice of Delivery by the Owner Participant and the Trust. The
making available by the Loan Participant of the amount of the Loan Participant's
Commitment for the Total Equipment Cost shall be deemed a waiver of the Notice
of Delivery by the Loan Participant and the Indenture Trustee.

            (b) Closing. The closing of the transactions contemplated hereby
(the "Closing") shall take place on or before 2:00 p.m., Chicago time, on the
Closing Date at the Chicago offices of Winston & Strawn LLP, or at such other
place or time as the parties hereto shall agree. Upon receipt by the Indenture
Trustee on the Closing Date of the full amount of the Owner Participant's
Commitment and the Loan Participant's Commitment in respect of the Units
delivered on the Closing Date, TILC shall cause TRLTII pursuant to the Transfer
and Assignment Agreement to deliver the Units described on Schedule 1-A hereto
to the Lessee by delivery of the TRLTII Bill of Sale and shall make an
assignment of the Existing Equipment Subleases to the Lessee by delivery of the
TRLTII Assignment, and immediately thereafter, (i) the Indenture Trustee, on
behalf of the Trust, shall, subject to the conditions set forth in Sections 4.1,
4.2 and 4.3 having been fulfilled to the satisfaction of the applicable
Participants or waived by the applicable Participants, pay to the Lessee from
the funds then held by it, in immediately available funds, an amount equal to
the Total Equipment Cost for the Units delivered on the Closing Date, (ii) the
Lessee shall pay to TRLTII pursuant to the Transfer and Assignment Agreement an
amount equal to the Total Equipment Cost for the Units delivered on the Closing
Date, (iii) the Lessee shall deliver the Units described on Schedule 1-A hereto
to the Trust by delivery of the Bill of Sale, (iv) the Trust shall, pursuant to
the Lease, lease and deliver the Units listed on Schedule 1-A hereto to the
Lessee, and the Lessee, pursuant to the Lease, shall accept delivery of the
Units described on Schedule 1-A hereto under the Lease, and such lease, delivery
and acceptance of such Units under the Lease shall be conclusively evidenced by
the execution and delivery by the Lessee and the Trust of the Lease Supplement
covering the Equipment so delivered as described in Schedule 1-A and (v) the
Trust shall execute (and the Indenture Trustee shall authenticate) and deliver
the Equipment Note relating to such Lease Supplement to the Loan Participant.
Concurrently with the transactions described immediately above, TRLTII shall
pursuant to the Pledged Equipment Transfer and Assignment Agreement sell the
Pledged Units described on Schedule 1-B hereto to the Lessee by delivery of the
Pledged Equipment Bill of Sale and shall make an assignment of the Existing
Pledged Equipment Leases to the Lessee by delivery of the TRLTII Pledged
Equipment Assignment. Each of the Lessee, the Owner Participant, the Trust, the
Owner Trustee, TILC, the Loan Participant and the Indenture Trustee hereby
agrees to take all actions required to be taken by it in connection with the
Closing as contemplated by this Section 2.3(b).

      Section 2.4 Owner Participant's Instructions to the Owner Trustee;
Satisfaction of Conditions.

            (a) The Owner Participant agrees that the making available to the
Indenture Trustee of the amount of the Owner Participant's Commitment for the
Units delivered on the Closing Date in accordance with the terms of this Section
2 shall constitute, without further act, authorization and direction by the
Owner Participant to the Owner Trustee, subject, on the Closing Date, to the
conditions set forth in Sections 4.1 and 4.3 having been fulfilled to the

                                       5

satisfaction of the Owner Participant or waived by the Owner Participant, to
take the actions specified in Section 2.04 of the Trust Agreement with respect
to the Units on the Closing Date.

            (b) The Owner Participant agrees that the authorization by the Owner
Participant or its counsel to the Indenture Trustee to release to the Lessee the
Owner Participant's Commitment with respect to the Units delivered on the
Closing Date shall constitute, without further act, notice and confirmation that
all conditions to closing set forth in Sections 4.1 and 4.3 were either met to
the satisfaction of the Owner Participant or, if not so met, were waived by the
Owner Participant.

            (c) The Loan Participant agrees that the authorization by the Loan
Participant or its counsel to the Indenture Trustee to release to the Lessee the
Loan Participant's Commitment with respect to the Units delivered on the Closing
Date shall constitute, without further act, notice and confirmation that all
conditions to closing set forth in Sections 4.1 and 4.2 were either met to the
satisfaction of the Loan Participant or, if not so met, were waived by the Loan
Participant.

      Section 2.5 Expenses.

            (a) If the Owner Participant shall have made its investment provided
for in Section 2.2 and the transactions contemplated by this Agreement are
consummated, either the Owner Participant will promptly pay, or the Trust will
promptly pay, with funds the Owner Participant hereby agrees to pay (which,
together with the Owner Participant's Commitment, shall not exceed the amount
set forth in the second sentence of Section 2.2(a)) to the Trust, the following
(collectively referred to as the "Transaction Costs") if evidenced by an invoice
delivered to the Owner Participant within four (4) months after the Closing Date
and approved by the Lessee and the Owner Participant (such approval not to be
unreasonably withheld or delayed):

                  (i) the cost of reproducing, printing and filing the Operative
Agreements, the Equipment Note, the Pass Through Documents and all amendments
and supplements to the foregoing, including all costs and fees in connection
with the initial filing and recording of the Lease, the Indenture and any other
document required to be filed or recorded pursuant to the provisions hereof or
of any other Operative Agreement and the fees and expenses of the Rating Agency
in connection with the rating of the Pass Through Certificates;

                  (ii) the reasonable out-of-pocket expenses of the Owner
Participant and the reasonable fees and expenses of Simpson Thacher & Bartlett
LLP, special counsel for the Owner Participant, plus disbursements, for their
services rendered in connection with the negotiation, execution and delivery of
this Agreement and the other Operative Agreements;

                  (iii) the initial fees and reasonable out-of-pocket expenses
of the Collateral Agent and the reasonable fees and expenses of Morris, James,
Hitchens & Williams LLP, special counsel for the Collateral Agent, for their
services rendered in connection with the negotiation, execution and delivery of
the Operative Agreements;

                  (iv) the reasonable out-of-pocket expenses of the Policy
Provider and the reasonable fees and expenses of Jones Day, special counsel for
the Policy Provider, for their

                                       6

services rendered in connection with the negotiation, execution and delivery of
this Agreement and the other Operative Agreements (which amounts shall be paid
by or on behalf of the Lessee on the Closing Date);

                  (v) the reasonable fees and expenses of Winston & Strawn LLP,
special counsel for TILC, the Lessee, TRLTII and Trinity, for their services
rendered in connection with the preparation of documentation, negotiation,
execution and delivery of this Agreement and the other Operative Agreements;

                  (vi) the reasonable fees and expenses of Mayer, Brown, Rowe &
Maw LLP, special counsel for the Initial Purchasers, for their services rendered
in connection with the preparation of documentation, negotiation, execution and
delivery of the Pass Through Documents, this Agreement and the other Operative
Agreements;

                  (vii) the reasonable fees and expenses of (x) Alvord & Alvord,
special STB counsel and (y) Blake, Cassels & Graydon LLP, special Canadian rail
counsel;

                  (viii) the reasonable fees and expenses of Shipman & Goodwin,
LLP, special counsel for the Owner Trustee, for their services rendered in
connection with the negotiation, execution and delivery of this Agreement and
the other Operative Agreements;

                  (ix) the reasonable fees and expenses of Morris, James,
Hitchens & Williams LLP, special counsel for the Indenture Trustee and the Pass
Through Trustee, for their services rendered in connection with the negotiation,
execution and delivery of the Pass Through Documents, this Agreement and the
other Operative Agreements;

                  (x) the reasonable fees and expenses of Deloitte & Touche LLP
for their services rendered in connection with delivering the letter referred to
in Section 4.1(aa);

                  (xi) the reasonable fees and expenses payable to the Arrangers
for their services rendered as advisor to the Lessee;

                  (xii) the initial fees and reasonable out-of-pocket expenses
of the Owner Trustee and the Trust;

                  (xiii) the initial fees and reasonable out-of-pocket expenses
of the Indenture Trustee;

                  (xiv) the initial fees and reasonable out-of-pocket expenses
of the Pass Through Trustee;

                  (xv) the reasonable fees of RailSolutions, Inc. (which fees
shall in no event exceed $8,000 in the aggregate in respect of the amounts
payable hereunder), plus disbursements, for their services rendered in
connection with delivering the Appraisal required by Section 4.3(a) and for
other consulting services (which amounts, to the extent they are obligations of
the Policy Provider, shall be paid by or on behalf of the Lessee on the Closing
Date);

                                       7

(xvi)   the reasonable fees of S&P and Moody's for their
services rendered in connection with the negotiation, execution and delivery of
this Agreement and the other Operative Agreements;

                  (xvii)  the costs incurred in connection with any adjustment
pursuant to Section 2.6(a);

                  (xviii) all costs and fees in connection with the
qualification of the Pass Through Certificates under federal or state securities
laws or Blue Sky laws in accordance with the provisions of the Certificate
Purchase Agreement;

                  (xix)   the reasonable fees and expenses of the advisor to the
Owner Participant; and

                  (xx)    the reasonable fees and expenses of Locke Liddell &
Sapp LLP, special Texas counsel to the Owner Participant.

            Except as expressly provided above, Transaction Costs shall not
include internal costs and expenses such as salaries and overhead of whatsoever
kind or nature of, or costs incurred by, parties to this Agreement pursuant to
arrangements with third parties for services (other than those expressly
referred to above).

            (b) Upon the consummation of the transactions contemplated by this
Agreement, the Lessee agrees to be responsible for, and will pay when due as
Supplemental Rent: (i) the reasonable expenses (including reasonable legal fees
and expenses) of the Trust, the Owner Trustee, the Indenture Trustee, the
Participants and the Policy Provider incurred subsequent to the delivery of the
Equipment on the Closing Date, in connection with any supplements, amendments,
modifications, alterations, waivers or consents (whether or not consummated) of
any of the Operative Agreements which are either (1) requested by the Lessee or
(2) required by any applicable law or regulation (other than laws or regulations
solely relating to the business of the Lessor, the Indenture Trustee, the Trust
Company, the Pass Through Trustee, the Initial Purchasers, the Collateral Agent
or any Participant) or (3) entered into in connection with, or as a result of, a
Lease Default or (4) required pursuant to the terms of the Operative Agreements
(including such reasonable expenses incurred in connection with any adjustment
pursuant to Section 2.6), (ii) the ongoing fees of the Owner Trustee under the
Trust Agreement, (iii) the ongoing fees of the Indenture Trustee under the
Operative Agreements, (iv) the ongoing fees of the Collateral Agent under the
Collateral Agency Agreement, (v) the ongoing fees of the Pass Through Trustee
under the Pass Through Trust Agreement and (vi) the ongoing fees of each Rating
Agency; provided that following the occurrence of the "Closing Date" under the
Other Participation Agreements, the fees referred to in clauses (iv) and (v)
immediately above shall be allocated between the transactions contemplated
hereby and the transactions contemplated by the Other Participation Agreements
on a pro rata basis based on the aggregate commitments of the Participants
hereunder as compared with the aggregate commitments of the participants under
the Other Participation Agreements.

            Notwithstanding the foregoing provisions of this Section 2.5, the
Lessee shall have no liability for (i) any costs or expenses relating to any
voluntary transfer of the Owner

                                       8

Participant's interest in the Equipment pursuant to Section 6.1 other than
during the continuance of a Lease Event of Default and no such costs or expenses
shall constitute Transaction Costs, (ii) any costs or expenses relating to any
voluntary transfer of any Loan Participant's interest in the Equipment Note
(other than any such transfer to the Policy Provider in accordance with the
Policy Provider Insurance and Indemnity Agreement) and (iii) any costs or
expenses relating to any voluntary transfer of any Certificateholder's interest
in the Pass Through Certificates (other than any such transfer to the Policy
Provider in accordance with the Policy Provider Insurance and Indemnity
Agreement), and in each case no such costs or expenses shall constitute
Transaction Costs.

            (c) To the extent Transaction Costs exceed 2.6% of the Total
Equipment Cost, Lessee shall pay such excess Transaction Costs. For purposes of
Section 2.5, the Transaction Costs described in Sections 2.5(a)(ii), (a)(iv),
(a)(vii), (a)(x), (a)(xv), (a)(xix) and (a)(xx) shall be paid first before other
Transaction Costs, and such other Transaction Costs shall not be paid or
reimbursed by Lessor to the extent total Transaction Costs exceed 2.6% of the
Total Equipment Cost less $186,000 until September 30, 2004.

      Section 2.6 Calculation of Adjustments to Basic Rent, Stipulated Loss
Value and Termination Value; Confirmation and Verification.

            (a) Calculation of Adjustments. In the event that (A) the Closing
Date is other than August 19, 2004, (B) the actual interest rate on the
Equipment Note is different from the Debt Rate or the amortization of the
Equipment Note is different from that set forth on Schedule 5, (C) a refinancing
contemplated by Section 10.2 occurs, (D) the actual aggregate Equipment Cost or
composition of the Units is different from that set forth on Schedule 1-A, (E)
the actual aggregate amount of Transaction Costs paid pursuant to Section 2.5(a)
is other than an amount equal to 2.6% of the Total Equipment Cost, or (F) there
is any proposed or actual change in the Code or in the regulations promulgated
thereunder or other administrative pronouncement, which change is enacted or
effective after the execution of this Agreement and prior to the Closing Date
(provided that the Owner Participant or the Lessee, as the case may be, shall
have provided notice to the other prior to the Closing Date), and which change
alters or eliminates any tax assumption used in calculating Basic Rent,
Stipulated Loss Values, Stipulated Loss Amounts, Termination Values, Termination
Amounts or Early Purchase Price, then, in each such case, the Owner Participant
shall recalculate the payments or amounts, as the case may be, of Basic Rent,
Stipulated Loss Values, Stipulated Loss Amounts, Termination Values, Termination
Amounts and Early Purchase Price (i) first, to preserve the Net Economic Return
that the Owner Participant would have realized had such event not occurred, and
(ii) second, to minimize to the greatest extent possible, consistent with the
foregoing clause (i), the present value (discounted monthly at an interest rate
per annum equal to the Debt Rate) of the sum of the payments of Basic Rent to
the Early Purchase Date and the Early Purchase Price; provided, however, that in
no event shall the Early Purchase Price be less than the expected fair market
value of the Equipment on the Early Purchase Date and the Basic Term Expiration
Date, respectively, as determined by the Appraisal. Any such recalculation
performed due to the occurrence of any one or more of the events described in
clause (A), (B), (D), (E) or (F) above shall be made prior to the Closing Date.
In performing any such recalculation and in determining the Owner Participant's
Net Economic Return, the Owner Participant shall utilize the same methods and
assumptions originally used in making the computations of Basic Rent, Stipulated
Loss Values,

                                       9

Stipulated Loss Amounts, Termination Values, Termination Amounts and Early
Purchase Price initially set forth in Schedules 3-A, 3-B, 4-A, 4-B and 6 (other
than those assumptions changed as a result of any of the events described in
clauses (A) through (F) of the preceding sentence necessitating such
recalculation; it being agreed that such recalculation shall reflect solely any
changes of assumptions or facts resulting directly from the event or events
necessitating such recalculation). Such adjustments shall comply (to the extent
the original structure complied) with Section 467 of the Code and the
requirements of Revenue Procedure 2001-28, calculated, except in the case of a
refinancing pursuant to Section 10.2, without taking into account any change
after the Closing Date in or to Section 467 of the Code (and any regulations
thereunder).

            (b) Confirmation and Verification. Upon completion of any
recalculation described in Section 2.6(a), a duly authorized officer of the
Owner Participant shall provide a certificate to the Lessee either (x) stating
that the amounts of Basic Rent, Stipulated Loss Values, Stipulated Loss Amounts,
Termination Values, Termination Amounts and Early Purchase Price as are then set
forth in Schedules 3-A, 3-B, 4-A, 4-B and 6 do not require change, or (y)
setting forth such adjustments to the amounts of Basic Rent, Stipulated Loss
Values, Stipulated Loss Amounts, Termination Values, Termination Amounts or
Early Purchase Price as have been calculated by the Owner Participant in
accordance with Section 2.6(a). Such certificate shall describe in reasonable
detail the basis for any such adjustments, and any such adjustment and
corresponding adjustments to the Stipulated Loss Values, Termination Values and
Early Purchase Price will be computed on a basis consistent with that used by
the Owner Participant in the original calculation of Basic Rent. Any such
adjustment shall be deemed approved upon notice of such approval by the Lessee
to the Owner Participant or on the thirty-first (31st) day following delivery of
such certificate by the Owner Participant to the Lessee unless the Lessee, prior
to such day, requests verification pursuant to the following sentence, and shall
become effective, in the case of adjustments made pursuant to clause (A), (B),
(D), (E) or (F) of the first sentence of Section 2.6(a), as of the earlier of
(i) the first Rent Payment Date and (ii) the date the Lessee approves or has
been deemed to have approved such adjustment, and, in the case of an adjustment
made pursuant to clause (C) of the first sentence of Section 2.6(a), as of the
date of the refinancing. If the Lessee shall so request, the recalculation of
any such adjustments described in this Section 2.6 shall be verified by a
nationally recognized firm of independent accountants selected by the Owner
Participant and reasonably acceptable to the Lessee, and any such recalculation
of such adjustment as so verified shall be binding on the Lessee and the Owner
Participant. Such accounting firm shall be requested to make its determination
within 30 days. The Owner Participant shall provide to a representative of such
accounting firm, subject to a confidentiality agreement reasonably satisfactory
to the Owner Participant, such information as it may reasonably require, as is
necessary to determine whether the computation is accurate and in conformity
with the provisions of this Agreement, provided that in no event shall the Owner
Participant or its affiliates have any obligation to provide the Lessee with any
such information; and provided, further, that the Owner Participant or its
affiliates shall have no obligation to disclose to the Lessee, such accounting
firm or any other Person, or to permit the Lessee, such accounting firm or any
other Person, to examine any federal, state or local income tax returns of the
Owner Participant or its affiliates, or books or accounting records related
thereto, for any taxable year. Subject to the immediately following sentence,
the costs of such verification shall be borne by the Lessee. If such accounting
firm's verification shall result in a decrease in the net present value
(expressed as a percentage of Total Equipment Cost, discounted monthly at a rate
per annum equal to the Debt Rate) of the sum of the Basic Rent to the Early
Purchase Date and

                                       10

the Early Purchase Price, calculated as of the Closing Date, as compared to the
net present value of the sum of the Basic Rent to the Early Purchase Date and
the Early Purchase Price, proposed by the Owner Participant, by more than the
greater of (i) ten basis points and (ii) 5% of the proposed adjustment, then the
Owner Participant agrees to reimburse the Lessee for any amounts paid for such
verification. Any revised adjustment resulting from such verification shall
become effective on the next Rent Payment Date after such verification has been
concluded (except that, in the case of an adjustment pursuant to clause (C) of
the first sentence of Section 2.6(c), such adjustment shall be effective as of
the date of the refinancing).

            (c) Compliance. Notwithstanding the foregoing, any adjustment made
to the payments of Basic Rent, Stipulated Loss Amounts, Termination Amounts or
Early Purchase Price, pursuant to the foregoing, shall comply with the following
requirements: (i) each installment of Basic Rent, as so adjusted, under any
circumstances and in any event, will be in an amount at least sufficient for the
Trust to pay in full as of the due date of such installment an amount equal to
the sum of (x) any payment of principal of and interest on the Equipment Note
required to be paid on the due date of such installment of Basic Rent in
accordance with the Scheduled Amortization and (y) an amount equal to the Policy
Provider Base Premium Amount required to be paid on the due date of such
installment of Basic Rent, and (ii) Stipulated Loss Amount, Termination Amount
and Early Purchase Price, as so adjusted, under any circumstances and in any
event, will be an amount which, together with any other amounts required to be
paid by the Lessee under the Lease in connection with an Event of Loss or a
termination of the Lease, as the case may be, will be at least sufficient to pay
in full, as of the date of payment thereof, the aggregate unpaid principal of
and all unpaid interest on the Equipment Note in accordance with the Scheduled
Amortization accrued to the date on which Stipulated Loss Amount, Termination
Amount or Early Purchase Price, as the case may be, is paid in accordance with
the terms of the Lease.

            (d) Invoices. All invoices in respect of Transaction Costs to the
extent not delivered on the Closing Date shall be directed to the Owner
Participant at the address set forth in Section 10.4, with a copy to the Lessee.

      Section 2.7 Postponement of Closing Date.

            (a) If for any reason whatsoever the Closing is not consummated on
the Closing Date provided for pursuant to Section 2.3 (the "Scheduled Closing
Date"), the Closing shall be deemed postponed to the next Business Day or to
such other Business Day on or prior to August 31, 2004 as the Lessee shall
specify by facsimile or telephonic (confirmed in writing) notice to the Owner
Participant, the Indenture Trustee, the Trust, the Owner Trustee, the Pass
Through Trustee, the Policy Provider and the Initial Purchasers, in which case
the Participants will keep their funds available, provided that the notice of
postponement shall be received by each party no later than 4:30 p.m., Chicago
time, on the originally scheduled Closing Date, and the term "Closing Date" as
used in this Agreement shall mean the postponed "Closing Date."

            (b) If the closing fails to occur on the Scheduled Closing Date, the
Indenture Trustee shall promptly return to each Participant that makes funds
available to it in accordance with this Section 2 such funds, together with
interest or income earned thereon.

                                       11

(c) If the Closing fails to occur on the Scheduled Closing Date and
funds are not returned to each Participant that made funds available by the
Indenture Trustee as provided by Section 2.7(b) above, the Indenture Trustee
shall, if so instructed by the Lessee in the facsimile or telephonic (confirmed
in writing) notice from the Lessee (which notice shall specify the Specified
Investments to be purchased), use reasonable best efforts to invest, at the risk
of the Lessee (except as provided below with respect to the Indenture Trustee's
gross negligence or willful misconduct), the funds received by the Indenture
Trustee from the Participants in Specified Investments in accordance with the
Lessee's instructions. Any such Specified Investments purchased by the Indenture
Trustee upon instructions from the Lessee shall be held in trust by the
Indenture Trustee (but not as part of the Indenture Estate under the Indenture)
for the benefit of the Participants that provided such funds. In order to obtain
funds for the payment of the Equipment Cost for the Units on the Closing Date or
to return funds to the Participants pursuant to Section 2.7(b), the Indenture
Trustee is authorized to sell any Specified Investments purchased as aforesaid.
The Indenture Trustee shall not be liable for failure to invest such funds or
for any losses incurred on such investments except for losses resulting from its
own willful misconduct or gross negligence.

            (d) If the Closing fails to occur on the Scheduled Closing Date,
unless the Indenture Trustee returns all funds to the Participants by 2:00 p.m.,
Chicago time, on the Scheduled Closing Date, the Lessee shall reimburse each
Participant that has made funds available pursuant to this Section 2 for the
loss of the use of its funds an amount equal to the excess, if any, of (x)
interest on such funds at the Debt Rate for the period from and including the
Scheduled Closing Date to but excluding the actual Closing Date or, if earlier,
the day on which such Participant's funds are returned if such return is made by
2:00 p.m., Chicago time (or to but excluding the next following Business Day if
such return is not made by such time); provided that with respect to the Owner
Participant such period shall in any case be at least one day, unless the Owner
Participant shall have received, prior to 12:00 noon (Chicago time) on the
Business Day preceding the Scheduled Closing Date, a notice of postponement of
the Scheduled Closing Date pursuant to Section 2.7(a), over (y) any amount paid
to such Participant in respect of interest or income earned by the Indenture
Trustee on such funds pursuant to Section 2.7(c) above.

            (e) If the Closing fails to occur on the Scheduled Closing Date, the
Lessee shall, on the Closing Date or on the date funds are required to be
returned to the Participants pursuant to Section 2.7(b) above, reimburse the
Indenture Trustee, for the benefit of the Participants that provided funds which
are invested by the Indenture Trustee pursuant to this Section 2.7 for any
losses incurred on such investments (except with respect to any Participant, if
the Closing failed to occur as a result of default by such Participant, or with
respect to the Owner Participant, as a result of default of the Owner Trustee
(acting pursuant to instructions from the Owner Participant)). All income and
profits on the investment of such funds shall be for the respective accounts of
such Participants, and the Indenture Trustee shall not be liable for failure to
invest such funds or for any losses incurred on such investments, except for its
willful misconduct or gross negligence.

            (f) Notwithstanding the provisions of Section 2.7(a), the
Participants shall not be under any obligation to make their respective
commitments available beyond 2:00 p.m. (Chicago time) on August 31, 2004.

                                       12

SECTION 3. REPRESENTATIONS AND WARRANTIES.

      Section 3.1 Representations and Warranties of the Trust Company. Trust
Company, in its individual capacity (except with respect to clauses (c), (k) and
(m) (to the extent applicable to Trust Company in its capacity as Owner Trustee)
below) and as Owner Trustee with respect to clauses (c), (f) and (k) (to the
extent applicable to Trust Company in its capacity as Owner Trustee) below,
represents and warrants to each of the Owner Participant, the Indenture Trustee,
the Pass Through Trustee, TILC, TRLTII, Trinity, the Lessee and the Policy
Provider, notwithstanding the provisions of Section 10.13 or any similar
provision in any other Operative Agreement, that, as of the date hereof and as
of the Closing Date:

            (a) Trust Company (i) is a national banking association duly
organized, validly existing and in good standing under the laws of the United
States of America, (ii) has the full corporate power, authority and legal right
under the laws of the State of Connecticut pertaining to its banking, trust and
fiduciary powers to carry on its business as now conducted and execute, deliver
and perform its obligations hereunder and under the Trust Agreement, (iii)
assuming the due authorization, execution and delivery of the Trust Agreement by
the Owner Participant, the Trust is a Connecticut statutory trust duly organized
and validly existing under the laws of the State of Connecticut and (iv)
assuming due authorization, execution and delivery of the Trust Agreement by the
Owner Participant, has full power and authority, as Owner Trustee and/or, to the
extent expressly provided herein or therein, in its individual capacity, to
execute, deliver and perform its obligations under each of the Owner Trustee
Agreements;

            (b) (i) Trust Company has duly authorized, executed and delivered
the Trust Agreement, (ii) assuming the due authorization, execution and delivery
of the Trust Agreement by the Owner Participant, Trust Company in its trustee
capacity and, to the extent expressly provided therein, in its individual
capacity, has, or on or prior to the Closing Date will have, duly authorized,
executed and delivered each of the other Owner Trustee Agreements and, as of the
Closing Date, the Equipment Note, the Lease Supplement and the Indenture
Supplement to be delivered on the Closing Date and (iii) the Trust Agreement
constitutes a legal, valid and binding obligation of Trust Company enforceable
against it in accordance with the terms thereof except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and by general principles of equity;

            (c) assuming the due authorization, execution and delivery of the
Trust Agreement by the Owner Participant, each of the Owner Trustee Agreements
(other than the Trust Agreement) to which it is a party constitutes, or when
entered into will constitute, a legal, valid and binding obligation of the Owner
Trustee, enforceable against it in accordance with the terms thereof, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the rights of creditors generally and
by general principles of equity;

            (d) neither the execution and delivery by Trust Company or Owner
Trustee, as the case may be, of the Owner Trustee Agreements or the Equipment
Note to be delivered on the Closing Date, nor the consummation by Trust Company
or Owner Trustee, as the case may be, of any of the transactions contemplated
hereby or thereby, nor the compliance by Trust Company or Owner Trustee, as the
case may be, with any of the terms and provisions hereof and thereof,

                                       13

(i) requires or will require any approval of its stockholders, or approval or
consent of any trustees or holders of any indebtedness or obligations of it in
its individual capacity, or (ii) violates or will violate its articles of
association or bylaws, or contravenes or will contravene any provision of, or
constitutes or will constitute a default under, or results or will result in any
breach of, any indenture, mortgage, chattel mortgage, deed of trust, conditional
sale contract, bank loan or credit agreement, license or other agreement or
instrument to which Trust Company is a party or by which it or any of its
properties may be bound or affected, or contravenes or will contravene any law,
governmental rule or regulation of the United States of America or the State of
Connecticut governing the banking, trust or fiduciary powers of Trust Company,
or any judgment or order applicable to or binding on it, or results in or will
result in the creation or imposition of any Lien upon the Trust Estate (other
than a Permitted Lien of the type described in clause (v) of the definition
thereof);

            (e) there are no Taxes payable by Trust Company or the Owner
Trustee, imposed by the State of Connecticut or any political subdivision
thereof in connection with the execution and delivery by Trust Company of the
Trust Agreement, and, as Trust Company or Owner Trustee, as the case may be, of
this Agreement, the other Owner Trustee Agreements (other than the Trust
Agreement) or the Equipment Note to be delivered on the Closing Date solely
because Trust Company is a national banking association with an office for trust
administration in Connecticut and performs certain of its duties as Owner
Trustee in the State of Connecticut; and there are no Taxes payable by Trust
Company or the Owner Trustee, as the case may be, imposed by the State of
Connecticut or any political subdivision thereof in connection with the
acquisition of its interest in the Equipment (other than franchise or other
taxes based on or measured by any fees or compensation received by Trust Company
or the Owner Trustee for services rendered in connection with the transactions
contemplated hereby) solely because Trust Company is a national banking
association with an office for trust administration in Connecticut and performs
certain of its duties as Owner Trustee in the State of Connecticut;

            (f) there are no pending or, to its knowledge, threatened actions or
proceedings against Trust Company or the Owner Trustee, before any court or
administrative agency which individually or in the aggregate, if determined
adversely to it, would be reasonably expected to materially adversely affect the
ability of Trust Company or the Owner Trustee, as the case may be, to perform
its obligations under the Trust Agreement, the other Owner Trustee Agreements or
the Equipment Note to be delivered on the Closing Date;

            (g) the "location" of the Trust Company for purposes of Article 9 of
the Uniform Commercial Code is in Delaware, and Trust Company agrees to give the
Owner Participant, the Indenture Trustee and the Lessee written notice within 30
days following any relocation of said chief executive office or said place from
its present location;

            (h) no consent, approval, order or authorization of, giving of
notice to, or registration with, or taking of any other action in respect of,
any Connecticut state or local governmental authority or agency or any United
States federal governmental authority or agency regulating the banking or trust
powers of Trust Company is required for the execution and delivery of, or the
carrying out by, Trust Company or the Owner Trustee, as the case may be, of any
of the transactions contemplated hereby or by the Trust Agreement or of any of
the

                                       14

transactions contemplated by any of the other Owner Trustee Agreements, other
than any such consent, approval, order, authorization, registration, notice or
action as has been duly obtained, given or taken;

            (i) on the Closing Date, the Trust's right, title and interest in
and to the Equipment delivered on the Closing Date shall be free and clear of
any Lessor's Lien attributable to Trust Company;

            (j) proceeds received by the Owner Trustee from the Owner
Participant pursuant to the Trust Agreement will be administered by it in
accordance with Article III of the Trust Agreement;

            (k) the Trust shall receive from the Lessee such title as was
conveyed to it by the Lessee, subject to the rights of the Trust and the Lessee
under the Lease and the Lien created pursuant to the Indenture and the Indenture
Supplement in respect of the Equipment delivered on the Closing Date, and there
will be no Lessor's Liens attributable to the Trust on the Equipment or any
interest therein or on the Trust Estate;

            (l) to its knowledge, no Indenture Default (not attributable to a
Lease Default) has occurred and is continuing;

            (m) the Owner Trustee is not engaged in the business of extending
credit for the purposes of purchasing or carrying margin stock, and no proceeds
of the Equipment Note or the Owner Participant's Commitment as contemplated by
this Agreement and the other Operative Agreements will be used by the Owner
Trustee for a purpose which violates, or would be inconsistent with, Section 7
of the Securities Exchange Act of 1934, as amended, or Regulations T, U and X of
the Federal Reserve System. Terms for which meanings are provided in Regulations
T, U and X of the Federal Reserve System or any regulations substituted
therefor, as from time to time in effect, are used in this Section 3.1 (m) with
such meanings; and

            (n) the Trust is not an "investment company" or an "affiliated
person" of an "investment company" within the meaning of the Investment Company
Act of 1940, as amended.

      Section 3.2 Representations and Warranties of the Lessee. The Lessee
represents and warrants to the Trust, the Owner Trustee, the Indenture Trustee,
the Participants, and the Policy Provider as of the date hereof and as of the
Closing Date:

            (a) as to organization, powers and partnership organizational
documents:

                  (i) the Lessee is a limited partnership duly organized,
validly existing, and in good standing under the laws of the State of Texas, is
duly licensed or qualified and in good standing in each jurisdiction in which
the failure to so qualify would reasonably be expected to have a material
adverse effect on its ability to carry on its business as now conducted and as
contemplated by the Operative Agreements to be conducted or to enter into and
perform its obligations under the Lessee Agreements, each Partnership Document
to which the Lessee is or will be a party and each Pass Through Document to
which the Lessee is or will be a party, is a special purpose limited partnership
organized to enter into the transactions contemplated by this Agreement, the
other Operative Agreements to which it is a party and the Pass Through

                                       15

Documents to which it is a party, has the limited partnership power and
authority to acquire from TRLTII and sell to the Trust the Equipment described
on Schedule 1-A hereto, to acquire from TRLTII and pledge to the Collateral
Agent the Pledged Equipment, to acquire from TRLTII and sell to the Trust the
Existing Equipment Subleases and to acquire from TRLTII and pledge to the
Collateral Agent the Existing Pledged Equipment Leases, in each case as
contemplated by this Agreement, and to carry on its business as now conducted
and as contemplated by the Operative Agreements to be conducted, has the
requisite limited partnership power and authority to execute, deliver and
perform its obligations under the Lessee Agreements, each Partnership Document
to which the Lessee is or will be a party and each Pass Through Document to
which the Lessee is or will be a party, and has conducted no business or
operations prior to the date hereof (other than those associated with its
organization and capitalization or as contemplated by the Operative Agreements),

                  (ii)  the General Partner is a limited liability company duly
formed, validly existing and in good standing under the laws of the State of
Delaware and has the power and authority to execute, deliver and perform its
obligations under the Partnership Agreement and each other organizational
document of the Partnership to which the General Partner is a party,

                  (iii) the Limited Partner is a limited liability company duly
formed, validly existing and in good standing under the laws of the State of
Delaware and has the power and authority to execute, deliver and perform its
obligations under the Partnership Agreement and each other organizational
document of the Partnership to which the Limited Partner is a party,

                  (iv)  the General Partner and the Limited Partner are the only
partners of the Partnership and TILC is the sole member of the General Partner
and the Limited Partner;

                  (v)   the execution, delivery and performance by each Partner
of the Partnership Agreement and each other organizational document of the
Partnership to which such Partner is a party (A) have been duly authorized by
all requisite limited liability company or member action of such Partner and (B)
did not and do not (x) violate (i) any provision of law, statute, rule or
regulation, or of the certificate of formation or limited liability company
agreement or other constitutive documents of such Partner, (ii) any order of any
governmental authority or (iii) any provision of any indenture, agreement or
other instrument to which such Partner is a party or by which it or any of its
property is or may be bound, (y) conflict with, result in a breach of or
constitute (alone or with notice, or lapse of time or both) a default under any
such indenture, agreement or other instrument or (z) result in the creation or
imposition of any Lien upon any property or assets of such Partner,

                  (vi)  each of the Partnership Agreement and each other
organizational document of the Partnership has been duly executed and delivered
by each party thereto and constitutes a legal, valid and binding obligation of
each such party enforceable against such party in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the rights of creditors
generally and by general principles of equity;

                                       16

(b) each of the Lessee Agreements and each Pass Through Document to
which the Lessee is a party have been duly authorized by all necessary limited
partnership action of the Lessee and, if required, limited liability company
action of each Partner, this Agreement has been duly executed and delivered (and
in the case of the other Lessee Agreements, such other Lessee Agreements will on
the Closing Date have been duly executed and delivered) by the General Partner
in its capacity as the general partner of the Lessee, and constitutes (and in
the case of the other Lessee Agreements, such other Lessee Agreements will on
the Closing Date constitute) the legal, valid and binding obligations of the
Lessee (assuming the due authorization, execution and delivery by each other
party thereto), enforceable against the Lessee in accordance with their
respective terms except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the rights of
creditors generally and by general principles of equity;

            (c) the execution, delivery and performance by the Lessee of each
Lessee Agreement and each Pass Through Document to which Lessee is a party and
compliance by the Lessee with all of the provisions thereof do not and will not
contravene any law or regulation, or any order, judgment, decree, determination
or award of any court or governmental authority or agency applicable to or
binding on the Lessee or any of its properties, or contravene the provisions of,
or constitute a default by the Lessee under, or result in the creation of any
Lien (except for Permitted Liens of the type described in clause (i), (ii) or
(v) of the definition thereof) upon the property of the Lessee under its
organizational documents or any indenture, mortgage, contract or other agreement
or instrument to which the Lessee is a party or by which the Lessee or any of
its properties may be bound or affected;

            (d) there are no proceedings pending or, to the knowledge of the
Lessee, threatened against the Lessee or any Partner in any court or before any
governmental authority or arbitration board or tribunal and neither the Lessee
nor any Partner is subject to any order of any court or governmental authority
or arbitration board or tribunal;

            (e) the unaudited balance sheet of the Lessee as at the Closing Date
fairly presents, in conformity with generally accepted accounting principles
applied on a pro forma basis, the pro forma financial position of the Lessee as
of such date;

            (f) no consent, approval or authorization of, or filing,
registration or qualification with, or the giving of notice to, any trustee or
any holder of indebtedness of the Lessee or any governmental authority on the
part of the Lessee is required in the United States, Canada or Mexico (subject
to the proviso set forth below) in connection with the execution and delivery by
the Lessee of the Lessee Agreements or the Pass Through Documents to which the
Lessee is a party or in order for the Lessee to perform its obligations
thereunder in accordance with the terms thereof, other than: (i) notices
required to be filed with the STB and the Registrar General of Canada as
described in Section 3.2(g), which notices shall have been filed on the Closing
Date, (ii) as may be required under existing laws, ordinances, governmental
rules and regulations to be obtained, given, accomplished or renewed at any time
after the Closing Date in connection with the operation and maintenance of the
Equipment, the Pledged Equipment, the Subleases and the Pledged Equipment Leases
in accordance with the Operative Agreements that are routine in nature and are
not normally applied for prior to the time they are required, and which the
Lessee has no reason to believe will not be timely obtained, (iii) as may be
required

                                       17

under the Operative Agreements in connection with any refinancing of the
Equipment Notes, (iv) as may be required under the Operative Agreements in
consequence of any transfer of the Beneficial Interest or any transfer of
ownership of the Equipment or the Pledged Equipment and (v) filing and recording
to perfect the Liens under the Indenture and the Collateral Agency Agreement as
required thereunder; provided, that the parties hereto agree that Lessee shall
not be required to make any such filings or recordings in Mexico;

            (g) the Lease, the Lease Supplement, the Indenture and the Indenture
Supplement (each in respect of the Units delivered on the Closing Date), the
Collateral Agency Agreement (or a memorandum with respect to any or all of such
documents), the TRLTII Bill of Sale, the Bill of Sale, the Pledged Equipment
Bill of Sale, the TRLTII Pledged Equipment Assignment, the TRLTII Assignment and
the Assignment will on or before the Closing Date be duly filed with the STB
pursuant to 49 U.S.C. Section 11301 and deposited with the Registrar General of
Canada pursuant to Section 105 of the Canada Transportation Act, and appropriate
Personal Property Security Act filings will be filed on or before the Closing
Date in the provinces of Canada where any Sublessee which is organized under the
laws of Canada or any province thereof has its chief executive office, and such
filing with the STB pursuant to 49 U.S.C. Section 11301, such deposit with the
Registrar General of Canada and such other filings will under the laws of the
United States and Canada perfect the Owner Trust's, the Indenture Trustee's and
the Collateral Agent's rights in such Operative Agreements, the Units described
on Schedule 1-A hereto, the Pledged Units, the Subleases and the Pledged
Equipment Leases and no other filing, recording or deposit with, or giving of
notice to any other U.S. federal, state or local government or Canadian national
or provincial government or agency thereof, or any other action, is necessary in
order to protect the rights of the Owner Trust, the Indenture Trustee and the
Collateral Agent in such Operative Agreements or in such Units, Pledged Units,
Subleases and Pledged Equipment Leases in the United States, any state thereof
or the District of Columbia or Canada or any province thereof;

            (h) the Equipment described on Schedule 1-A hereto is covered by the
insurance required by Section 12 of the Lease and the Pledged Equipment is
covered by the insurance required by Section 6.4 of the Collateral Agency
Agreement, and all premiums due prior to the Closing Date in respect of such
insurance shall have been paid in full and such insurance is in full force and
effect;

            (i) no Lease Default or Manager Default has occurred and is
continuing and, to the knowledge of the Lessee, no Event of Loss, Pledged Unit
Event of Loss or event that, with the giving of notice, the passage of time or
both, would constitute an Event of Loss or a Pledged Unit Event of Loss, has
occurred;

            (j) none of the Lessee, any Partner or the Pass Through Trustee is
an "investment company" or an "affiliated person" of an "investment company"
within the meaning of the Investment Company Act of 1940, as amended;

            (k) the acquisition and holding by the Owner Participant of the
Beneficial Interest and the consummation of the transactions contemplated under
this Agreement and each other Operative Agreement and Pass Through Document will
not constitute or result in a prohibited transaction within the meaning of
Section 4975(c) of the Code or Section 406 of

                                       18

ERISA and will not involve any transaction in connection with which a tax or a
penalty could be imposed pursuant to Section 502(i) or ERISA or Section 4975 of
the Code. The representation made by the Lessee in the preceding clause is made
in reliance upon and subject to the accuracy of the representation of the Owner
Participant in Section 3.5(h) and the accuracy of the representation of the
Initial Purchasers set forth in Section 4(e) of the Certificate Purchase
Agreement;

            (l) on the Closing Date, (i) the Lessee has, and shall pursuant to
the Bill of Sale relating to the Equipment described on Schedule 1-A hereto
convey to the Trust, all legal and beneficial title to such Equipment free and
clear of all Liens except as set forth on Schedule 9 (other than Permitted Liens
of the type described in clauses (ii) (with respect to the Existing Equipment
Subleases), (iii), (iv) and (v) of the definition thereof, and such conveyance
will not be void or voidable under any applicable law; (ii) TRLTII has, and
shall pursuant to the Pledged Equipment Bill of Sale relating to the Pledged
Equipment convey to the Partnership, all legal and beneficial title to such
Pledged Equipment free and clear of all Liens except as set forth on Schedule 8
(other than Permitted Liens of the type described in clauses (ii) (with respect
to Existing Pledged Equipment Leases), (iii), (iv) and (v) of the definition
thereof), and such conveyance will not be void or voidable under any applicable
law; and (iii) the Lessee has, and the Assignment to be delivered on the Closing
Date shall assign to the Trust, all legal and beneficial title to the Existing
Equipment Subleases and the Lessee has all legal and beneficial title to the
Existing Pledged Equipment Leases, free and clear of all Liens except as set
forth on Schedule 8 (other than in each case Permitted Liens of the type
described in clauses (ii), (iii), (iv) and (v) of the definition thereof), and
the Assignment will not be void or voidable under any applicable law;

            (m) the written information provided by the Lessee or on behalf of
the Lessee in the offering circular dated August 10, 2004 (the "Offering
Circular") does not contain any untrue statement of a material fact and does not
omit a material fact necessary to make the statements contained therein, in
light of the circumstances under which they were made, not misleading; the
assumptions and related financial information relating to the proposed business
and operations of the Lessee and the Equipment and Pledged Equipment which are
contained in the Offering Circular have been prepared in good faith based upon
information that the Lessee deems fair and reasonable, and there are no
statements or conclusions therein which are based on or include information
known to the Lessee to be misleading in any material respect or which fail to
take into account material information known to the Lessee regarding the matters
stated therein; certain information contained in the Offering Circular (e.g.
statistical information relating to renewal and remarketing of railcars,
potential increases in absolute or nominal railcar lease rates, anticipated
utilization, and maintenance costs) is based on the historical experience of
TILC; and subject to the foregoing, there can be no assurance that past
experience will be indicative of future performance with respect to these or
other operating and marketing factors set forth in the Offering Circular;

            (n) the Lessee and the Partners are not engaged in the business of
extending credit for the purposes of purchasing or carrying margin stock, and no
proceeds of the Equipment Note or the Owner Participant's Commitment as
contemplated by this Agreement and the other Operative Agreements will be used
by the Lessee or any Partner for a purpose which violates, or would be
inconsistent with, Section 7 of the Securities Exchange Act of 1934, as amended,
or

                                       19

Regulations T, U and X of the Federal Reserve System; terms for which meanings
are provided in Regulations T, U and X of the Federal Reserve System or any
regulations substituted therefor, as from time to time in effect, are used in
this Section 3.2(n) with such meanings;

            (o) the Lessee is not in violation of any term of any of its
organizational documents or in violation or breach of or in default under any
other agreement, contract or instrument to which it is a party or by which it or
any of its property may be bound;

            (p) the Lessee is in compliance with all laws, ordinances,
governmental rules, regulations, orders, judgments, decrees, determinations and
awards to which it is subject and the Lessee has obtained all required licenses,
permits, franchises and other governmental authorizations material to the
conduct of its business;

            (q) on the Closing Date, all sales, use or transfer taxes, if any,
due and payable upon the purchase of the Equipment described on Schedule 1-A
hereto by the Lessee from TRLTII and by the Trust from the Lessee and upon the
lease thereof by the Trust to the Lessee and, if applicable, upon the assignment
of the Existing Equipment Subleases from TRLTII to the Lessee and by the Lessee
to the Trust and upon the purchase of the Pledged Equipment by the Lessee from
TRLTII and, if applicable, upon the assignment of the Existing Pledged Equipment
Leases from TRLTII to the Lessee will have been paid or such transactions will
then be exempt from any such taxes, and the Lessee will cause any required forms
or reports in connection with such taxes to be filed in accordance with
applicable laws and regulations;

            (r) no broker's or finder's or placement fee or commission will be
payable with respect to the transactions contemplated by the Operative
Agreements as a result of any action by the Lessee, except for the fees of the
Arrangers, which shall be included in Transaction Costs as provided in this
Agreement, and the Lessee agrees that it will hold the Participants, the Policy
Provider, the Indenture Trustee, the Pass Through Trustee, the Trust and the
Owner Trustee harmless from any claim, demand or liability for broker's or
finder's or placement fees or commission alleged to have been incurred as a
result of any action by the Lessee in connection with this transaction;

            (s) (i) each Unit delivered on the Closing Date, taken as a whole,
and each major component thereof complies in all material respects with all
applicable laws and regulations, all requirements of the manufacturer for
maintaining in full force and effect any applicable warranties and the
requirements, if any, of any applicable insurance policies, conforms with the
specifications for such Unit contained in the Appraisal referred to in Section
4.3(a) hereof (to the extent a copy of such Appraisal or a relevant excerpt
therefrom has been delivered to the Lessee) and is substantially complete such
that it is ready and available to operate in commercial service and otherwise
perform the function for which it was designed; and the railcar identification
marks shown on Schedule 1-A are the marks presently used on the Units of
Equipment set forth on Schedule 1-A and (ii) each Pledged Unit, taken as a
whole, and each major component thereof, complies in all material respects with
all applicable laws and regulations, all requirements of the manufacturer for
maintaining in full force and effect any applicable warranties, and the
requirements, if any, of any applicable insurance policies, conforms with the
specifications for such Pledged Unit contained in the Appraisal referred to in
Section 4.3(a) hereof (to the extent a copy of such Appraisal or a relevant
excerpt therefrom has

                                       20

been delivered to the Lessee) and is substantially complete such that it is
ready and available to operate in commercial service and otherwise perform the
function for which it was designed; and the railcar identification marks shown
on Schedule 1-B are the marks presently used on the Pledged Units;

            (t) neither the Lessee nor any Partner is subject to regulation as a
"holding company," an "affiliate" of a "holding company," or a "subsidiary
company" of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended;

            (u) all of the Units delivered on the Closing Date are subject to
sublease by Sublessees under the Existing Equipment Subleases and all of the
Pledged Units delivered on the Closing Date are subject to lease by Pledged
Equipment Lessees under the Existing Pledged Equipment Leases, and each such
Sublease and Pledged Equipment Lease contains rental and other terms which are
no different, taken as a whole, from those for similar railcars in the TILC
Fleet;

            (v) each item or Unit of Equipment described on Schedule 1-A
constitutes Eligible Equipment and each item or Unit of Pledged Equipment
described on Schedule 1-B constitutes Eligible Pledged Equipment;

            (w) (i) each of the Subleases and each of the Pledged Equipment
Leases is freely assignable from TRLTII to the Lessee, from the Lessee to the
Owner Trust and from the Owner Trust to any other Person (including, without
limitation, any transferee in connection with the Indenture Trustee's or Owner
Trustee's exercise of rights or remedies under the Lease or the Collateral
Agency Agreement, as applicable) or, if any Sublease or Pledged Equipment Lease
is not freely assignable, then consents to such assignments that are
satisfactory to each of the Participants and the Policy Provider have been
obtained prior to the Closing Date, (ii) no assignment described in this Section
3.2 (w)(x) is void or voidable or (y) will result in a claim for damages or
reduction in rental or other payments, in each case pursuant to the terms and
conditions of any such Sublease or Pledged Equipment Lease and (iii) no consent,
approval or filing is required under the Subleases in connection with the
execution and delivery of the Operative Agreements;

            (x) [Reserved].

            (y) (i) none of the Units or the Pledged Units are subject to a
purchase option under the terms of the applicable Sublease or Pledged Equipment
Lease except for the Units and Pledged Units listed on Schedule 7-A attached
hereto; (ii) each such purchase option is for fair market value (at the time of
such purchase);

            (z) after giving effect to the transfers contemplated under the
Operative Agreements and the Partnership Documents, (i) the Subleases and
Pledged Equipment Leases in effect on the Closing Date and each of the riders or
schedules with respect thereto are not subject to and do not cover railcars
financed in, any financing or securitization transaction other than the
transactions contemplated by the Operative Agreements and the Partnership
Documents, (ii) except as set forth on Schedule 9 attached hereto, the Subleases
and Pledged Equipment Leases in effect on the Closing Date conform in all
respects with the terms and conditions described in

                                       21

the definitions of Permitted Sublease (other than clause (vi) thereof) and
Permitted Pledged Equipment Lease (other than clause (v) thereof), respectively,
and (iii) except as set forth on Schedule 9 attached hereto, none of the
Subleases or Pledged Equipment Leases are in default (by reason of the lessee or
lessor thereunder);

            (aa) assuming the accuracy of the representations and warranties of
the Initial Purchaser contained in the Certificate Purchase Agreement and its
compliance with the agreements set forth therein, it is not necessary, in
connection with the issuance and sale of the Pass Through Certificates to the
Initial Purchaser and the offer, resale and delivery of the Pass Through
Certificates by the Initial Purchaser in the manner contemplated by the
Certificate Purchase Agreement and the Offering Circular (as defined in the
Certificate Purchase Agreement), to register the Pass Through Certificates under
the Securities Act or to qualify the Indentures under the Trust Indenture Act;

            (bb) the Lessee is solvent and will not be rendered insolvent by the
transactions contemplated by the Operative Agreements and, after giving effect
to such transactions, the Lessee will not be left with an unreasonably small
amount of capital with which to engage in its business, and the Lessee does not
intend to incur, nor believes that it has incurred, debts beyond its ability to
pay as they mature; and

            (cc) all written information provided by the Lessee or any Affiliate
of the Lessee to the Appraiser with respect to the Units, the Pledged Units, the
Subleases and the Pledged Equipment Leases (as described or listed on Schedules
1-A, 1-B, 1-C, and 1-D, respectively) is true to correct in all material
respects. All written information provided by the Lessee or any Affiliate of
Lessee to Deloitte & Touche LLP with respect to the Subleases and the Pledged
Equipment Leases (as described or listed on Schedules 1-C and 1-D, respectively)
is true and correct in all material respects and accurately reflects the terms
of the Subleases and the Pledged Equipment Leases. To the extent the written
information referred to in this clause (cc) was provided to the Appraiser,
Deloitte & Touche LLP and the Arranger, in each case for their use in connection
with their services on the date hereof rendered as contemplated hereby, such
entities had been provided with the same written information (or relevant
portions thereof).

      Section 3.3 Representations and Warranties of the Indenture Trustee. The
Indenture Trustee represents and warrants to the Owner Participant, the Trust,
the Owner Trustee, the Pass Through Trustee, the Policy Provider, TILC, TRLTII,
Trinity and the Lessee that, as of the date hereof and as of the Closing Date:

            (a) the Indenture Trustee is a Delaware banking corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Delaware and has the full corporate power, authority and legal right under
the laws of the State of Delaware pertaining to its banking, trust and fiduciary
powers to execute, deliver and perform its obligations under each of the
Indenture Trustee Agreements;

            (b) the execution, delivery and performance by the Indenture Trustee
of each of the Indenture Trustee Agreements have been duly authorized by the
Indenture Trustee and will not violate any applicable federal or Delaware law
governing its banking or trust powers or

                                       22

its charter documents or bylaws or the provisions of any indenture, mortgage,
contract or other agreement to which it is a party or by which it or any of its
properties may be bound or affected;

            (c) this Agreement has been duly executed and delivered and
constitutes, and each of the other Indenture Trustee Agreements, when executed
and delivered, will constitute (assuming the due authorization, execution and
delivery by each other party thereto) the legal, valid and binding obligation of
the Indenture Trustee, enforceable against the Indenture Trustee in accordance
with its terms except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the rights of
creditors generally and by general principles of equity;

            (d) there are no proceedings pending or, to the knowledge of the
Indenture Trustee, threatened, and to the knowledge of the Indenture Trustee
there is no existing basis for any such proceedings, against or affecting the
Indenture Trustee in or before any court or before any governmental authority or
arbitration board or tribunal which, individually or in the aggregate, if
adversely determined, might impair the ability of the Indenture Trustee to
perform its obligations under the Indenture Trustee Agreements;

            (e) no authorization or approval or other action by, and no notice
to or filing with, any stockholder, trustee or holder of indebtedness or any
federal or Delaware state governmental authority or regulatory body governing
the Indenture Trustee in its trust capacity, is required for the due execution,
delivery and performance by the Indenture Trustee of the Indenture Trustee
Agreements, except as have been previously obtained, given or taken;

            (f) the Indenture Trustee is not in default under any of the
Indenture Trustee Agreements; and

            (g) neither the Indenture Trustee, nor any Person authorized to act
on behalf of the Indenture Trustee, has directly or indirectly offered any
interest in the Trust Estate or the Equipment Note or any security similar to
either thereof related to this transaction for sale to, or solicited offers to
buy any of the same from, or otherwise approached or negotiated with respect to
any of the same with, any Person other than the Pass Through Trustee and the
Initial Purchasers.

      Section 3.4 Representations, Warranties and Covenants Regarding Beneficial
Interest, Equipment Note and Pass Through Certificates.

            (a) Owner Trustee and Trust Company. Each of the Owner Trustee and
the Trust Company represents and warrants to the Lessee, the Indenture Trustee,
the Pass Through Trustee, the Policy Provider, TILC, TRLTII, Trinity and the
Owner Participant that, as of the date hereof and as of the Closing Date, except
as expressly provided in the Operative Agreements, neither the Owner Trustee,
nor the Trust Company nor any Person authorized or employed by the Owner Trustee
or the Trust Company as agent or otherwise has directly or indirectly offered or
sold any interest in the Beneficial Interest, the Equipment Note, the Pass
Through Certificates or any part thereof, or in any similar security or lease,
the offering of which for the purposes of the Securities Act would be deemed to
be part of the same offering as the offering of the Beneficial Interest, the
Equipment Note, the Pass Through Certificates or any part

                                       23

thereof or solicited any offer to acquire any of the same in violation of the
registration requirements of Section 5 of the Securities Act.

            (b) Lessee. The Lessee represents and warrants to the Trust, the
Owner Trustee, the Indenture Trustee, the Policy Provider, the Owner Participant
and the Pass Through Trustee that, as of the date hereof and as of the Closing
Date, neither the Lessee nor any Person authorized or employed by the Lessee as
agent or otherwise has directly or indirectly offered or sold any interest in
the Beneficial Interest, the Equipment Note, the Pass Through Certificates or
any part thereof, the offering of which for the purposes of the Securities Act
would be deemed to be part of the same offering as the offering of the
Beneficial Interest, the Equipment Note, the Pass Through Certificates or any
part thereof or solicited any offer to acquire any of the same in violation of
the registration requirements of Section 5 of the Securities Act.

            (c) TRLTII. TRLTII represents and warrants to the Trust, the Owner
Trustee, the Indenture Trustee, the Policy Provider, the Owner Participant and
the Pass Through Trustee that, as of the date hereof and as of the Closing Date,
neither TRLTII nor any Person authorized or employed by TRLTII as agent or
otherwise has directly or indirectly offered or sold any interest in the
Beneficial Interest, the Equipment Note, the Pass Through Certificates or any
part thereof, the offering of which for the purposes of the Securities Act would
be deemed to be part of the same offering as the offering of the Beneficial
Interest, the Equipment Note, the Pass Through Certificates or any part thereof
or solicited any offer to acquire any of the same in violation of the
registration requirements of Section 5 of the Securities Act.

            (d) TILC. TILC represents and warrants to the Trust, the Owner
Trustee, the Indenture Trustee, the Policy Provider, the Owner Participant and
the Pass Through Trustee that, as of the date hereof and as of the Closing Date,
neither TILC nor any Person authorized or employed by TILC as agent or otherwise
has directly or indirectly offered or sold any interest in the Beneficial
Interest, the Equipment Note, the Pass Through Certificates or any part thereof,
the offering of which for the purposes of the Securities Act would be deemed to
be part of the same offering as the offering of the Beneficial Interest, the
Equipment Note, the Pass Through Certificates or any part thereof or solicited
any offer to acquire any of the same in violation of the registration
requirements of Section 5 of the Securities Act.

            (e) Owner Participant. The Owner Participant represents and warrants
to the Trust, the Owner Trustee, the Indenture Trustee, the Policy Provider,
TILC, TRLTII, Trinity, the Lessee and the Pass Through Trustee that, as of the
date hereof and as of the Closing Date, neither the Owner Participant nor any
Person authorized or employed by the Owner Participant as agent or otherwise has
directly or indirectly offered or sold any interest in the Beneficial Interest,
the Equipment Note, the Pass Through Certificates or any part thereof, or in any
similar security or lease, the offering of which for the purposes of the
Securities Act would be deemed to be part of the same offering as the offering
of the Beneficial Interest, the Equipment Note, the Pass Through Certificates or
any part thereof or solicited any offer to acquire any of the same in violation
of the registration requirements of Section 5 of the Securities Act.

            (f) Pass Through Trustee. The Pass Through Trustee represents and
warrants to the Trust, the Owner Trustee, the Indenture Trustee, the Policy
Provider, TILC, TRLTII, Trinity, the Lessee and the Owner Participant that, as
of the date hereof and as of the Closing

                                       24

Date, neither the Pass Through Trustee nor any Person authorized or employed by
the Pass Through Trustee as agent or otherwise has directly or indirectly
offered or sold any interest in the Beneficial Interest, the Equipment Note, the
Pass Through Certificates or any part thereof, the offering of which for the
purposes of the Securities Act would be deemed to be part of the same offering
as the offering of the Beneficial Interest, the Equipment Note, the Pass Through
Certificates or any part thereof or solicited any offer to acquire any of the
same in violation of the registration requirements of Section 5 of the
Securities Act.

            (g) Trinity. Trinity represents and warrants to the Trust, the Owner
Trustee, the Indenture Trustee, the Policy Provider, TILC, TRLTII, the Lessee
and the Owner Participant that, as of the date hereof and as of the Closing
Date, neither Trinity nor any Person authorized or employed by Trinity as agent
or otherwise has directly or indirectly offered or sold any interest in the
Beneficial Interest, the Equipment Note, the Pass Through Certificates or any
part thereof, the offering of which for the purposes of the Securities Act would
be deemed to be part of the same offering as the offering of the Beneficial
Interest, the Equipment Note, the Pass Through Certificates or any part thereof
or solicited any offer to acquire any of the same in violation of the
registration requirements of Section 5 of the Securities Act.

            (h) Future Actions. Each of the Owner Trustee, the Trust Company,
the Owner Participant, the Lessee, TILC, TRLTII, Trinity, the Indenture Trustee
and the Pass Through Trustee agrees, as to its own actions only, severally but
not jointly, that neither the Owner Trustee, the Trust Company, the Owner
Participant, the Lessee, TILC, TRLTII, the Indenture Trustee nor the Pass
Through Trustee nor anyone acting on behalf of the Owner Trustee, the Trust
Company, the Owner Participant, the Lessee, TILC, TRLTII, the Indenture Trustee
or the Pass Through Trustee will offer the Beneficial Interest, the Equipment
Note, the Pass Through Certificates or any part thereof or any similar interest
for issue or sale to any prospective purchaser, or solicit any offer to acquire
any of the Beneficial Interest, the Equipment Note, the Pass Through
Certificates or any part thereof so as to cause Section 5 of the Securities Act
to apply to the issuance and sale of the Beneficial Interest, the Equipment
Note, the Pass Through Certificates or any part thereof.

      Section 3.5 Representations and Warranties of the Owner Participant. The
Owner Participant represents and warrants to the Trust, the Owner Trustee, the
Indenture Trustee, the Pass Through Trustee, the Policy Provider, TILC, TRLTII,
Trinity and the Lessee that, as of the date hereof:

            (a) the Owner Participant is an Ohio corporation duly formed,
validly existing and in good standing under the laws of the State of Ohio and
has full corporate power and authority to carry on its business as now
conducted;

            (b) the Owner Participant has the requisite corporate power and
authority to execute, deliver and perform its obligations under the Owner
Participant Agreements, and the execution, delivery and performance by it
thereof do not and will not contravene any law or regulation, or any order of
any court or governmental authority or agency applicable to or binding on the
Owner Participant or any of its properties, or contravene the provisions of, or
constitute a default under or breach of, or result in the creation or imposition
of any Lien (other than the Lien granted to the Indenture Trustee under and
pursuant to the Indenture) upon the

                                       25

Equipment, Subleases or any other portion of the Trust Estate under, its
certificate of incorporation, bylaws or any indenture, mortgage, contract or
other agreement or instrument to which the Owner Participant is a party or by
which it or any of its properties may be bound or affected;

            (c) the Owner Participant Agreements have been duly authorized by
all necessary actions on the part of the Owner Participant, do not require any
approval not already obtained of the partners of the Owner Participant or any
approval or consent not already obtained of any trustee or holders of
indebtedness or obligations of the Owner Participant, have been, or on or before
the Closing Date will be, duly executed and delivered by the Owner Participant
and (assuming the due authorization, execution and delivery by each other party
thereto) constitute, or will constitute, the legal, valid and binding
obligations of the Owner Participant, enforceable against the Owner Participant
in accordance with their respective terms, except as enforceability may be
limited by bankruptcy, insolvency, moratorium or other similar laws affecting
the rights of creditors generally and by general principles of equity;

            (d) no authorization or approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body is required for
the due execution, delivery or performance by the Owner Participant of the Trust
Agreement, the Tax Indemnity Agreement or this Agreement;

            (e) the Trust Estate is free and clear of any Lessor's Lien
attributable to the Owner Participant;

            (f) there are no pending or, to the Owner Participant's knowledge,
threatened actions or proceedings against the Owner Participant before any court
or administrative agency that would reasonably be expected to materially
adversely affect the Owner Participant's ability to perform its obligations
under the Trust Agreement, the Tax Indemnity Agreement or any other Operative
Agreement to which the Owner Participant is a party;

            (g) as of the Closing Date, the Owner Participant is purchasing the
Beneficial Interest to be acquired by it for its own account with no present
intention of distributing such Beneficial Interest or any part thereof in any
manner which would violate the Securities Act, but without prejudice, however,
to the right of the Owner Participant at all times to sell or otherwise dispose
of all or any part of such Beneficial Interest in compliance with the Securities
Act and any state securities or "blue sky" laws; provided, however, that subject
to the provisions of Section 6.1, the disposition of the Beneficial Interest
shall at all times be within the Owner Participant's control. The Owner
Participant acknowledges that its Beneficial Interest has not been registered
under the Securities Act, and that neither the Owner Participant, the Owner
Trustee, Trust Company, the Lessee, TRLTII nor TILC contemplates filing, or is
legally required to file, any such registration statement; notwithstanding the
foregoing, the Owner Participant makes no representation that the Beneficial
Interest is a "security" within the meaning of such term under the Securities
Act;

            (h) with respect to the source of the amount to be invested by the
Owner Participant to acquire the Beneficial Interest and to pay any Transaction
Costs as required under

                                       26

this Agreement, no part of such amount constitutes assets of any employee
benefit plan subject to Title I of ERISA or Section 4975 of the Code; and

            (i) except for fees payable to the advisor to the Owner Participant,
no broker's or finder's or placement fee or commission will be payable with
respect to the transactions contemplated by the Operative Agreements as a result
of any action by the Owner Participant, and the Owner Participant agrees that it
will hold TILC, TRLTII, the Lessee, the Indenture Trustee, the Loan Participant
and the Owner Trustee harmless from any claim, demand or liability for broker's
or finder's or placement fees or commission alleged to have been incurred as a
result of any action by the Owner Participant in connection with this
transaction.

      Section 3.6 Representations and Warranties of TILC. TILC represents and
warrants to each of the Trust, the Owner Trustee, the Indenture Trustee, the
Policy Provider and the Participants, as of the date hereof and as of the
Closing Date (which representations, to the extent the same relate to the
Equipment, the Subleases, the Pledged Equipment Leases or the assignment and
conveyance of the Equipment or Subleases to the Trust, are made by TILC in its
capacity as "Manager" for and on behalf of TRLTII, the transferor thereof):

            (a) TILC is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Delaware, is duly licensed or
qualified and in good standing in each jurisdiction in which the failure to so
qualify would reasonably be expected to have a material adverse effect on its
ability to carry on its business as now conducted or as contemplated to be
conducted or to execute, deliver and perform its obligations under the TILC
Agreements and the Partnership Documents to which it is or will be a party, has
the power and authority to carry on its business as now conducted and as
contemplated to be conducted, and has the requisite power and authority to
execute, deliver and perform its obligations under the TILC Agreements and the
Partnership Documents to which it is or will be a party;

            (b) the TILC Agreements have been duly authorized by all necessary
corporate action, executed and delivered by TILC, and (assuming the due
authorization, execution and delivery by each other party thereto) constitute
the legal, valid and binding obligations of TILC, enforceable against TILC in
accordance with their respective terms except as enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
the rights of creditors generally and by general principles of equity;

            (c) the execution, delivery and performance by TILC of each TILC
Agreement and compliance by TILC with all of the provisions thereof do not and
will not contravene or, in the case of clause (iii), constitute (alone or with
notice, or lapse of time or both) a default under or result in any breach of, or
result in the creation or imposition of any Lien upon any property of TILC
pursuant to, (i) any law or regulation, or any order, judgment, decree,
determination or award of any court or governmental authority or agency
applicable to or binding on TILC or any of its properties, or (ii) the
provisions of its certificate of incorporation or bylaws or (iii) any indenture,
mortgage, contract or other agreement or instrument to which TILC is a party or
by which TILC or any of its properties may be bound or affected except, with
respect to clause (iii), where such contravention, default or breach would not
reasonably be expected to materially adversely affect TILC's ability to perform
its obligations under the TILC

                                       27

Agreements or any Sublease or Pledged Equipment Leases to which TILC is a party
or materially adversely affect its financial condition or business;

            (d) there are no proceedings pending or, to the knowledge of TILC,
threatened against TILC in any court or before any governmental authority or
arbitration board or tribunal that, if adversely determined, would reasonably be
expected to materially adversely affect TILC's ability to perform its
obligations under the TILC Agreements or Subleases or Pledged Equipment Leases
to which TILC is a party or materially adversely affect its financial condition
or business;

            (e) TILC is not in violation of (x) any term of any charter
instrument or bylaw or (y) in violation or breach of or in default under any
other agreement or instrument to which it is a party or by which it or any of
its property may be bound except in the case of clause (y) where such violation,
breach or default would not reasonably be expected to materially adversely
affect TILC's ability to perform its obligations under the TILC Agreements or
materially adversely affect its financial condition or business. TILC is in
compliance with all laws, ordinances, governmental rules, regulations, orders,
judgments, decrees, determinations and awards to which it is subject, the
failure to comply with which would reasonably be expected to have a material and
adverse effect on its operations or condition, financial or otherwise, or would
impair the ability of TILC to perform its obligations under the TILC Agreements,
and has obtained all required licenses, permits, franchises and other
governmental authorizations material to the conduct of its business;

            (f) no consent, approval or authorization of, or filing,
registration or qualification with, or the giving of notice to, any trustee or
any holder of indebtedness of TILC or any governmental authority on the part of
TILC is required in the United States in connection with the execution and
delivery by TILC of the TILC Agreements or any Sublease or Pledged Equipment
Lease to which TILC is a party, or is required to be obtained in order for TILC
to perform its obligations thereunder in accordance with the terms thereof,
other than (i) as may be required under existing laws, ordinances, governmental
rules and regulations to be obtained, given, accomplished or renewed at any time
after the Closing Date in connection with the performance of its obligations
under the TILC Agreements and which are routine in nature and are not normally
applied for prior to the time they are required, and which TILC has no reason to
believe will not be timely obtained or (ii) as may be required under the
Operative Agreements in consequence of any transfer of ownership of the
Equipment or the Pledged Equipment occurring after the Closing Date;

            (g) to the best knowledge of TILC, no casualty event or other event
that may constitute an Event of Loss under the Lease or a Pledged Unit Event of
Loss under the Collateral Agency Agreement has occurred as of the date of this
Agreement with respect to any Unit or Pledged Unit delivered on the Closing
Date;

            (h) (i) TRLTII has, and the TRLTII Bill of Sale to be delivered on
the Closing Date shall convey to the Lessee, all legal and beneficial title to
the Units which are being delivered on the Closing Date, free and clear of all
Liens (other than Permitted Liens of the type described in clause (ii) below
with respect to the Existing Equipment Subleases, and in clauses (iii), (iv),
(v) and (viii) of the definition thereof), and such conveyance will not be void
or voidable under any applicable law; (ii) TRLTII has, and the TRLTII Assignment
to be delivered

                                       28

on the Closing Date shall assign to the Lessee, all legal and beneficial title
to the Existing Equipment Subleases, free and clear of all Liens (other than
Permitted Liens of the type described in clauses (ii), (iii), (iv), (v) and
(viii) of the definition thereof), and such assignment will not be void or
voidable under any applicable law; (iii) all of the Units being delivered on the
Closing Date other than an immaterial amount shall be subject to sublease by the
Sublessees under the Existing Equipment Subleases on rental and other terms
which are no different, taken as a whole, from those for similar railcars in the
rest of the TILC Fleet (iv) TRLTII shall have, and the TILC Pledged Equipment
Bill of Sale to be delivered on the Closing Date shall convey to the Lessee, all
legal and beneficial title to the Pledged Units which are being delivered on the
Closing Date, free and clear of all Liens (other than Permitted Liens of the
type described in clauses (ii), (iii), (iv) and (v) of the definition thereof),
and such conveyance will not be void or voidable under any applicable law; (v)
TRLTII shall have, and the TRLTII Pledged Equipment Assignment to be delivered
on the Closing Date shall assign to the Lessee, all legal and beneficial title
to the Existing Pledged Equipment Leases, free and clear of all Liens (other
than Permitted Liens of the type described in clauses (ii), (iii), (iv) and (v)
of the definition thereof), and such assignment will not be void or voidable
under any applicable law; and (vi) all of the Pledged Units shall be subject to
lease by the Pledged Equipment Lessees under the Existing Pledged Equipment
Leases on rental and other terms which are no different, taken as a whole, from
those for similar railcars in the rest of the TILC Fleet;

            (i) (a) all sales, use or transfer taxes, if any, due and payable
upon the sale of the Equipment and assignment of Existing Equipment Subleases by
TRLTII to the Lessee on the Closing Date will have been paid or such
transactions will then be exempt from any such taxes and TILC will cause any
required forms or reports in connection with such taxes to be filed in
accordance with applicable laws and regulations; and (b) all sales, use or
transfer taxes, if any, due and payable upon the sale of the Pledged Equipment
and assignment of Existing Pledged Equipment Leases by TRLTII to the Lessee will
have been paid or such transactions will then be exempt from any such taxes and
TRLTII will cause any required forms or reports in connection with such taxes to
be filed in accordance with applicable laws and regulations;

            (j) all Units delivered on the Closing Date and all Pledged Units
are substantially similar in terms of objectively identifiable characteristics
that are relevant for purposes of the services to be performed by TILC under the
Management Agreement to the equipment in the TILC Fleet;

            (k) in selecting the Units to be sold on the Closing Date to the
Lessee pursuant to the TRLTII Bill of Sale and in selecting the Pledged Units to
be sold to the Lessee pursuant to the TRLTII Pledged Equipment Bill of Sale,
TRLTII has not discriminated against the Lessee in a negative fashion when such
Units and Pledged Units are compared with the other equipment in the TILC Fleet;

            (l) the written information provided by TILC or TRLTII or on behalf
of TRLTII in the Offering Circular does not contain any untrue statement of a
material fact and does not omit a material fact necessary to make the statements
contained therein, in light of the circumstances under which they were made, not
misleading; the assumptions and related financial information relating to the
proposed business and operations of TILC and the Equipment which are contained
in the Offering Circular have been prepared in good faith based

                                       29

upon information that TILC deems fair and reasonable, and there are no
statements or conclusions therein which are based on or include information
known to TILC to be misleading in any material respect or which fail to take
into account material information known to TILC regarding the matters stated
therein; certain information contained in the Offering Circular (e.g.
statistical information relating to renewal and remarketing of railcars,
potential increases in absolute or nominal railcar lease rates, anticipated
utilization, and maintenance costs) is based on the historical experience of
TILC; subject to the foregoing, there can be no assurance that past experience
will be indicative of future performance with respect to these or other
operating and marketing factors set forth in the Offering Circular;

            (m) Neither TILC nor TRLTII is in default under any Existing
Equipment Subleases or Existing Pledged Equipment Leases (as applicable), and,
to the best of TILC's and TRLTII's knowledge (as applicable), there are (i) no
defaults by any Sublessee or Pledged Equipment Lessee thereunder existing as of
the date hereof under the Existing Equipment Subleases or Existing Pledged
Equipment Leases, except such defaults that are not payment defaults, except to
a de minimus extent (but giving effect to any applicable grace periods) and are
not material, (ii) no claims or liabilities arising as a result of the operation
or use of any Unit described on Schedule 1-A hereto prior to the date hereof as
to which the Lessor, as owner of the Units delivered on the Closing Date, would
be liable and (iii) no claims or liabilities arising as a result of the
operation or use of any Pledged Unit prior to the date hereof as to which the
Lessee, as owner of the Pledged Units, would be liable (in each case, except for
the ongoing maintenance obligations of the "lessor" provided for under
full-service Subleases);

            (n) (i) the balance sheet of TILC as of March 31, 2004 and June 30,
2004, and the related statements of operations, stockholders' equity and cash
flows for the periods then ended, and (ii) the balance sheet of TILC as of
December 31, 2003 and the related statements of income and cash flows of TILC
for the twelve month period ended on December 31, 2003, have been prepared in
accordance with generally accepted accounting principles (except as may be
stated in the notes thereto and except, with respect to interim financial
statements, for yearend audit adjustments), consistently applied, and fairly set
forth, in all material respects, the financial condition of TILC as of such
dates and the results of their operations and cash flows for such periods;

            (o) Neither TILC nor TRLTII is engaged in the business of extending
credit for the purposes of purchasing or carrying margin stock, and no proceeds
of the Equipment Note or the Owner Participant's Commitment as contemplated by
this Agreement and the other Operative Agreements will be used by TILC or TRLTII
for a purpose which violates, or would be inconsistent with, Section 7 of the
Securities Exchange Act of 1934, as amended, or Regulations T, U and X of the
Federal Reserve System; terms for which meanings are provided in Regulations T,
U and X of the Federal Reserve System or any regulations substituted therefor,
as from time to time in effect, are used in this Section 3.6(q) with such
meanings;

            (p) no Lease Default, Manager Default or event that, with the giving
of notice, the passage of time or both, would constitute a Manager Default has
occurred and is continuing;

                                       30

(q) since December 31, 2003, there has not occurred a material
adverse change in the business, assets or condition (financial or otherwise) or
results of operations of TILC and its consolidated subsidiaries, taken as a
whole;

            (r) (i) none of the Units or the Pledged Units are subject to a
purchase option under the terms of the applicable Sublease or Pledged Equipment
Lease except for the Units and Pledged Units listed on Schedule 7-A attached
hereto; (ii) each such purchase option is for fair market value (at the time of
such purchase);

            (s) assuming the accuracy of the representations and warranties of
the Initial Purchaser contained in the Certificate Purchase Agreement and its
compliance with the agreements set forth therein, it is not necessary, in
connection with the issuance and sale of the Pass Through Certificates to the
Initial Purchaser and the offer, resale and delivery of the Pass Through
Certificates by the Initial Purchaser in the manner contemplated by the
Certificate Purchase Agreement and the Offering Circular (as defined in the
Certificate Purchase Agreement), to register the Pass Through Certificates under
the Securities Act or to qualify the Indentures under the Trust Indenture Act;

            (t) based on TILC's review of mileage/usage records with respect to
the Affected PPSA Units (as defined in Section 6.13), the Affected PPSA Units
when used in Canada have been used predominantly on the rails of Canadian
National Railway Company and/or Canadian Pacific Railway Company; and

            (u) all written information provided by TILC or any Affiliate of
TILC to the Appraiser with respect to the Units, the Pledged Units, the
Subleases and the Pledged Equipment Leases (as described or listed on Schedules
1-A, 1-B, 1-C, and 1-D, respectively) is true to correct in all material
respects. All written information provided by TILC or any Affiliate of TILC to
Deloitte & Touche LLP with respect to the Subleases and the Pledged Equipment
Leases (as described or listed on Schedules 1-C and 1-D, respectively) is true
and correct in all material respects and accurately reflects the terms of the
Subleases and the Pledged Equipment Leases. To the extent the written
information referred to in this clause (v) was provided to the Appraiser,
Deloitte & Touche LLP and the Arranger, in each case for their use in connection
with their services on the date hereof rendered as contemplated hereby, such
entities had been provided with the same written information (or relevant
portions thereof).

      Section 3.7 Representations and Warranties of TRLTII. TRLTII represents
and warrants to the Indenture Trustee, the Trust, the Owner Trustee and the
Participants, as of the date hereof:

            (a) TRLTII is a statutory trust duly organized, validly existing,
and in good standing under the laws of the State of Delaware, is duly licensed
or qualified and in good standing in each jurisdiction in which the failure to
so qualify would have a material adverse effect on its ability to carry on its
business as now conducted or to execute, deliver and perform its obligations
under the Partnership Documents to which it is or will be a party, has the power
and authority to carry on its business as now conducted, and has the requisite
power and authority to execute, deliver and perform its obligations under the
TRLTII Agreements;

                                       31

(b) the TRLTII Agreements have been duly authorized by all necessary
corporate action, executed and delivered by TRLTII, and (assuming the due
authorization, execution and delivery by each other party thereto) constitute
the legal, valid and binding obligations of TRLTII, enforceable against TRLTII
in accordance with their respective terms except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and by general principles of equity;

            (c) the execution, delivery and performance by TRLTII of each TRLTII
Agreement and compliance by TRLTII with all of the provisions thereof do not and
will not contravene (i) any law or regulation, or any order of any court or
governmental authority or agency applicable to or binding on TRLTII or any of
its properties, or (ii) the provisions of, or constitute a default by TRLTII
under, its certificate of trust or trust agreement or (iii) any indenture,
mortgage, contract or other agreement or instrument to which TRLTII is a party
or by which TRLTII or any of its properties may be bound or affected;

            (d) there are no proceedings pending or, to the knowledge of TRLTII,
threatened against TRLTII in any court or before any governmental authority or
arbitration board or tribunal;

            (e) TRLTII is not in violation of any term of any (x) charter
instrument or operating agreement or (y) any other agreement or instrument to
which it is a party or by which it may be bound except in the case of clause (y)
where such violation would not materially adversely affect TRLTII's ability to
perform its obligations under the TRLTII Agreements or materially adversely
affect its financial condition or business. TRLTII is in compliance with all
laws, ordinances, governmental rules and regulations to which it is subject, the
failure to comply with which would have a material and adverse effect on its
operations or condition, financial or otherwise, or would impair the ability of
TRLTII to perform its obligations under the TRLTII Agreements, and has obtained
all licenses, permits, franchises and other governmental authorizations material
to the conduct of its business; and

            (f) no consent, approval or authorization of, or filing,
registration or qualification with, or the giving of notice to, any trustee or
any holder of indebtedness of TRLTII or any governmental authority on the part
of TRLTII is required (x) in connection with the execution and delivery by
TRLTII of the TRLTII Agreements, or (y) to be obtained in order for TRLTII to
perform its obligations thereunder in accordance with the terms thereof, other
than in the case of clause (y) those which are routine in nature and are not
normally applied for prior to the time they are required, and which TRLTII has
no reason to believe will not be timely obtained; and

            (g) TRLTII is solvent and will not be rendered insolvent by the
transactions contemplated by the Operative Agreements and, after giving effect
to such transactions, TRLTII will not be left with an unreasonably small amount
of capital with which to engage in its business, and TRLTII does not intend to
incur, nor believes that it has incurred, debts beyond its ability to pay as
they mature.

      Section 3.8 Representations and Warranties of the Pass Through Trustee.
The Pass Through Trustee represents and warrants to the Trust, the Owner
Trustee, the Indenture Trustee,

                                       32

the Policy Provider, the Owner Participant, TILC, TRLTII, Trinity and the Lessee
that, as of the date hereof:

            (a) the Pass Through Trustee is a Delaware banking corporation duly
organized and validly existing in good standing under the laws of the State of
Delaware and has the full corporate power, authority and legal right under the
laws of the State of Delaware pertaining to its banking, trust and fiduciary
powers to execute, deliver and perform its obligations under the Pass Through
Trustee Agreements and the Pass Through Documents to which it is a party;

            (b) this Agreement has been, and on the Closing Date, each of the
other Pass Through Trustee Agreements will have been, duly authorized, executed
and delivered by the Pass Through Trustee; this Agreement constitutes, and on
the Closing Date, each of the other Pass Through Trustee Agreements will
constitute, the legal, valid and binding obligations of the Pass Through
Trustee, enforceable against the Pass Through Trustee in accordance with their
respective terms except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the rights of
creditors generally and by general principles of equity;

            (c) the execution, delivery and performance by the Pass Through
Trustee of each of the Pass Through Trustee Agreements, the purchase by the Pass
Through Trustee of the Equipment Note pursuant to this Agreement, and the
issuance of the Pass Through Certificates pursuant to the Pass Through Trust
Agreement, do not contravene any law, rule or regulation of any federal or
Delaware governmental authority or agency regulating the Pass Through Trustee's
banking, trust or fiduciary powers or any judgment or order applicable to or
binding on the Pass Through Trustee and do not contravene or result in any
breach of, or constitute a default under, or in the case of clause (ii) below,
result in the creation or imposition of any Lien upon the Pass Through Trust
Estate, (i) the Pass Through Trustee's charter documents or bylaws or (ii) any
agreement or instrument to which the Pass Through Trustee is a party or by which
it or any of its properties may be bound or affected;

            (d) neither the execution and delivery by the Pass Through Trustee
of each of the Pass Through Trustee Agreements nor the consummation by the Pass
Through Trustee of any of the transactions contemplated thereby, requires the
consent or approval of, the giving of notice to, or the registration with, or
the taking of any other action with respect to, any federal or Delaware
governmental authority or agency regulating the Pass Through Trustee's banking,
trust or fiduciary powers;

            (e) there are no pending or, to its knowledge, threatened actions or
proceedings against the Pass Through Trustee before any court or administrative
agency which individually or in the aggregate, if determined adversely to it,
would materially adversely affect the ability of the Pass Through Trustee to
perform its obligations under any of the Pass Through Trustee Agreements;

            (f) the Pass Through Trustee is not in default under any Pass
Through Trustee Agreement;

                                       33

(g) the Pass Through Trustee does not directly or indirectly
control, and is not directly or indirectly controlled by or under common control
with, the Owner Participant, the Owner Trustee, the Initial Purchasers, TILC,
TRLTII or the Lessee;

            (h) the Pass Through Trustee is purchasing the Equipment Note for
the purposes contemplated by the Operative Agreements and the Pass Through
Documents and not with a view to the transfer or distribution of any Equipment
Note to any other Person, except as contemplated by the Operative Agreements and
the Pass Through Documents; and

            (i) except for the issue and sale of the Pass Through Certificates
contemplated hereby and by the other Pass Through Trustee Agreements, the Pass
Through Trustee has not directly or indirectly offered any Equipment Note or
Pass Through Certificate or any interest in or to the Trust Estate, the Trust
Agreement or any similar interest for sale to, or solicited any offer to acquire
any of the same from, anyone other than the Owner Trustee and the Owner
Participant, and the Pass Through Trustee has not authorized anyone to act on
its behalf to offer directly or indirectly any Equipment Note, any Pass Through
Certificate or any interest in and to the Trust Estate, the Trust Agreement or
any similar interest related to this transaction for sale to, or to solicit any
offer to acquire any of the same from, any Person other than the Owner Trustee
and the Owner Participant.

      Section 3.9 Representations and Warranties of Trinity. Trinity represents
and warrants to the Owner Participant, Trust, the Owner Trustee, the Indenture
Trustee, the Pass Through Trustee and the Policy Provider that, as of the date
hereof:

            (a) Trinity is a corporation duly formed, validly existing and in
good standing under the laws of the State of Delaware and has full corporate
power and authority to carry on its business as now conducted;

            (b) Trinity has the requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement, and the
execution, delivery and performance by it thereof do not and will not contravene
any law or regulation, or any order of any court or governmental authority or
agency applicable to or binding on Trinity or any of its properties, or
contravene the provisions of, or constitute a default under or breach of, or
result in the creation or imposition of any Lien (other than the Lien granted to
the Indenture Trustee under and pursuant to the Indenture) upon the Equipment,
Pledged Equipment, Subleases, Pledged Equipment Leases or any other portion of
the Trust Estate or Collateral under, its Certificate of Incorporation, bylaws
or any indenture, mortgage, contract or other agreement or instrument to which
Trinity is a party or by which it or any of its properties may be bound or
affected;

            (c) this Agreement has been duly authorized by all necessary actions
on the part of Trinity, does not require any approval not already obtained by
Trinity or any approval or consent not already obtained of any trustee or
holders of indebtedness or obligations of Trinity, has been, or on or before the
Closing Date will be, duly executed and delivered by Trinity and (assuming the
due authorization, execution and delivery by each other party thereto)
constitutes, or will constitute, the legal, valid and binding obligations of
Trinity, enforceable against Trinity in accordance with their respective terms,
except as enforceability may be limited by bankruptcy,

                                       34

insolvency, moratorium or other similar laws affecting the rights of creditors
generally and by general principles of equity;

            (d) no authorization or approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body is required for
the due execution, delivery or performance by Trinity of this Agreement;

            (e) there are no pending or, to Trinity's knowledge, threatened
actions or proceedings against Trinity before any court or administrative agency
that would reasonably be expected to materially adversely affect Trinity's
ability to perform its obligations under this Agreement;

            (f) since December 31, 2003, there has not occurred a material
adverse change in the business, assets, condition (financial or otherwise) or
results of operations of Trinity and its consolidated subsidiaries, taken as a
whole; and

            (g) (i) the balance sheet of Trinity as of March 31, 2004 and June
30, 2004, and the related statements of operations, stockholders' equity and
cash flows for the periods then ended, and (ii) the balance sheet of Trinity as
of December 31, 2003 and the related statements of income and cash flows of
Trinity for the twelve month period ended on December 31, 2003, have been
prepared in accordance with generally accepted accounting principles (except as
may be stated in the notes thereto and except, with respect to interim financial
statements, for yearend audit adjustments), consistently applied, and fairly set
forth, in all material respects, the financial condition of Trinity as of such
dates and the results of their operations and cash flows for such periods.

      Section 3.10 Representations and Warranties of the Policy Provider. The
Policy Provider represents and warrants to the Lessee, TILC, TRLTII, Trinity,
the Owner Participant, Trust, the Owner Trustee, the Indenture Trustee and the
Pass Through Trustee that, as of the date hereof:

            (a) Organization and Licensing. The Policy Provider is a stock
insurance corporation duly organized, validly existing and in good standing
under the laws of the State of Wisconsin;

            (b) Corporate Power. The Policy Provider has the corporate power and
authority to execute and deliver this Agreement and to perform all of its
obligations hereunder;

            (c) Authorization; Approvals. All proceedings legally required for
the execution, delivery and performance of this Agreement have been taken and
all licenses, orders, consents or other authorizations or approvals of the
Policy Provider's board of directors or stockholders or any governmental boards
or bodies legally required for the enforceability of this Agreement have been
obtained or are not material to the enforceability of this Agreement;

            (d) Enforceability. This Agreement constitutes, a legal, valid and
binding obligation of the Policy Provider, enforceable in accordance with its
terms, subject to (x) insolvency, liquidation, rehabilitation, reorganization,
moratorium, receivership and other similar laws affecting creditors' rights
generally and by general principles of equity and

                                       35

(y) principles of public policy limiting the right to enforce the
indemnification provisions contained therein and herein, insofar as such
provisions relate to indemnification for liabilities arising under federal
securities laws.

            (e) No Conflict. The execution by the Policy Provider of this
Agreement will not, and the satisfaction of the terms hereof and thereof will
not, conflict with or result in a breach of any of the terms, conditions or
provisions of the certificate of incorporation or bylaws of the Policy Provider,
or any restriction contained in any contract, agreement or instrument to which
the Policy Provider is a party or by which it is bound, or constitute a default
under any of the foregoing that would materially and adversely affect its
ability to perform its obligations under this Agreement.

      Section 3.11 Opinion Acknowledgment. Each of the parties hereto, with
respect to such party, expressly consents to the rendering by its counsel of the
opinion referred to in Section 4.1 (e) and acknowledges that such opinion shall
be deemed to be rendered at the request and upon the instructions of such party.

SECTION 4. CLOSING CONDITIONS.

      Section 4.1 Conditions Precedent to Investment by Each Participant. The
obligation of each Participant to make the investment specified with respect to
such Participant in Section 2 on the Closing Date shall be subject to the
satisfaction or waiver of the following conditions precedent (except that the
obligations of any Person shall not be subject to such Person's own performance
or compliance):

            (a) Execution of Operative Agreements. On or before the Closing
Date, this Agreement, the Trust Agreement, the Lease, the Lease Supplement in
respect of the Units delivered on the Closing Date, the Indenture, the Indenture
Supplement in respect of the Units delivered on the Closing Date, the Equipment
Note, the Pass Through Documents, the Management Agreement, the Insurance
Agreement, the Transfer and Assignment Agreement, the Pledged Equipment Transfer
and Assignment Agreement, the Pledged Equipment Bill of Sale, the TRLTII Pledged
Equipment Assignment, the TRLTII Bill of Sale, the TRLTII Assignment, the Bill
of Sale, the Assignment, the Collateral Agency Agreement, and the Administrative
Services Agreement shall each be satisfactory in form and substance to such
Participant, shall have been duly executed and delivered by the parties thereto
(except that the execution and delivery of the documents referred to above
(other than this Agreement) by a party hereto or thereto shall not be a
condition precedent to such party's obligations hereunder), shall each be in
full force and effect, and executed counterparts of each shall have been
delivered to such Participant or its counsel on or before the Closing Date; and
no event shall have occurred and be continuing that constitutes a Lease Default,
a Manager Default, an Indenture Default or to the knowledge of any party hereto,
an Event of Loss.

            (b) Recordation and Filing. On or before the Closing Date (except as
expressly stated below), the Lessee shall have caused the Lease, the Lease
Supplement, the Indenture and the Indenture Supplement (each in respect of Units
delivered on the Closing Date), the Collateral Agency Agreement in respect of
the Pledged Units delivered on the Closing Date, the Pledged Equipment Bill of
Sale, the TRLTII Pledged Equipment Assignment, the TRLTII

                                       36

Bill of Sale, the Bill of Sale, the TRLTII Assignment and the Assignment to be
duly filed, recorded and deposited in memorandum form with the STB in conformity
with 49 U.S.C. Section 11301 and with the Registrar General of Canada pursuant
to Section 105 of the Canada Transportation Act, and all necessary actions shall
have been taken to cause publication of notice of such deposit in The Canada
Gazette in accordance with said Section 105 and all appropriate Uniform
Commercial Code financing statements and Personal Property Security Act filings
in respect of the interests of the Owner Trustee, Collateral Agent and Indenture
Trustee under the Operative Agreements to be delivered on the Closing Date and
to be filed where necessary or reasonably advisable within 10 days after the
Closing Date, and the Lessee shall furnish the Indenture Trustee, the Policy
Provider, the Owner Trustee, the Collateral Agent and each Participant proof
thereof. Without limiting the representations and warranties set forth in any
Operative Agreement, by such recording or filing of the Lease (or a financing
statement or similar notice thereof), the Owner Trustee and the Lessee are not
acknowledging or implying that the Lease constitutes a "security agreement" or
creates a "security interest" within the meaning of the Uniform Commercial Code
in any applicable jurisdiction.

            (c) Representations and Warranties of the Lessee. On the Closing
Date, the representations and warranties of the Lessee contained in Section 3.2
and Section 3.4(b) hereof shall be true and correct as of the Closing Date as
though then made on and as of such date, except to the extent that such
representations and warranties relate solely to an earlier date (in which case
such representations and warranties were true and correct on and as of such
earlier date), and each of the Trust, the Owner Trustee, the Indenture Trustee,
the Policy Provider and the Participants shall have received an Officer's
Certificate to such effect dated such date from the General Partner of the
Lessee certifying to the foregoing matters, and the Lessee shall have performed
and complied with all agreements and conditions herein contained which are
required to be performed or complied with by the Lessee on or before said date.

            (d) Representations and Warranties of the Owner Trustee. On the
Closing Date, the representations and warranties of the Trust Company and the
Owner Trustee contained in Section 3.1 and Section 3.4(a) shall be true and
correct as of the Closing Date as though then made on and as of such date except
to the extent that such representations and warranties relate solely to an
earlier date (in which case such representations and warranties were true and
correct on and as of such earlier date), and each of the Lessee, the Indenture
Trustee, the Policy Provider, TILC, TRLTII and the Participants shall have
received an Officer's Certificate to such effect dated such date from the Trust
Company (in respect of the Trust Company) and the Owner Trustee (in respect of
the Owner Trustee), and the Trust Company and the Owner Trustee shall have
performed and complied with all agreements and conditions herein contained which
are required to be performed or complied with by the Trust Company and the Owner
Trustee, respectively, on or before said date.

            (e) Opinions of Counsel. On the Closing Date, the Owner Trustee, the
Indenture Trustee, the Policy Provider and each Participant shall have received
the favorable written opinion of each of (i) Winston & Strawn LLP, special
counsel for the Lessee, TILC, Trinity, and TRLTII, (A) substantially in the form
of Exhibit E-1 and (B) regarding certain other matters, (ii) counsel for the
Lessee, TILC, TRLTII and Trinity (which counsel shall be the Vice President of
Legal Affairs of Trinity), substantially in the form of Exhibit E-2, (iii)
Shipman & Goodwin LLP, counsel to the Owner Trustee, substantially in the form
of Exhibit E-3, (iv)

                                       37

Simpson, Thacher & Bartlett LLP, special counsel to the Owner Participant,
substantially in the form of Exhibit E-4, (v) counsel of the Owner Participant
(which counsel shall be the Associate Counsel and Assistant Secretary of the
Owner Participant), substantially in the form of Exhibit E-5, (vi) Morris,
James, Hitchens & Williams LLP, special counsel to the Indenture Trustee,
Collateral Agent and Pass Through Trustee substantially in the form of Exhibit
E-6, (vii) Alvord & Alvord, special STB counsel, substantially in the form of
Exhibit E-7, (viii) Blake, Cassels & Graydon LLP, special Canadian counsel,
substantially in the form of Exhibit E-8, (ix) counsel for the Policy Provider
(which counsel shall be the Assistant General Counsel of the Policy Provider),
substantially in the form of Exhibit E-9 and (x) Haynes & Boone, LLP, special
counsel for the Lessee, substantially in the form of Exhibit E-10.

            (f) Title. On the Closing Date, after giving effect to the
transactions contemplated hereby, (i) the Trust shall have all legal and
beneficial title to each Unit to be delivered on the Closing Date, free and
clear of all Liens (other than the interests of Sublessees under Existing
Equipment Subleases and other than Permitted Liens of the type described in
clauses (iii), (iv) and (v) of the definition thereof) and (ii) the Trust shall
have received all right, title and interest of the Lessee in and to the Existing
Equipment Subleases, free and clear of all Liens (other than Permitted Liens of
the type described in clauses (ii), (iii), (iv) and (v) of the definition
thereof). In addition, (i) the Lessee shall have all legal and beneficial title
to each Pledged Unit to be delivered on the Closing Date, free and clear of all
Liens (other than Permitted Liens of the type described in clauses (ii), (iii),
(iv) and (v) of the definition thereof), (ii) the Lessee shall have received all
right, title and interest of TRLTII in and to the Existing Pledged Equipment
Leases, free and clear of all Liens (other than Permitted Liens of the type
described in clauses (ii), (iii), (iv) and (v) of the definition thereof) and
(iii) each Pledged Equipment Lessee under an Existing Pledged Equipment Lease
shall have been notified of the assignment thereof to the Lessee.

            (g) Bills of Sale; Assignments. On the Closing Date, each of the
following documents shall each have been duly executed and delivered: (i) the
TRLTII Bill of Sale and the Bill of Sale, in each case in form and substance
reasonably satisfactory to the Lessee, the Owner Trustee, the Indenture Trustee,
the Policy Provider and the Pass Through Trustee, dated such date and covering
the Units to be delivered on such date, (ii) the TRLTII Assignment and the
Assignment, in each case in form and substance reasonably satisfactory to the
Lessee, the Owner Trustee, the Indenture Trustee, the Policy Provider and the
Pass Through Trustee, dated such date covering the Existing Equipment Subleases,
(iii) the TRLTII Pledged Equipment Bill of Sale in form and substance reasonably
satisfactory to the Lessee, the Owner Trustee, the Indenture Trustee, the Policy
Provider and the Pass Through Trustee, dated such date and covering the Pledged
Units to be delivered on such date, and (iv) the TRLTII Pledged Equipment
Assignment in form and substance reasonably satisfactory to the Lessee, the
Owner Trustee, the Indenture Trustee, the Policy Provider and the Pass Through
Trustee, dated such date covering the Existing Pledged Equipment Leases.

            (h) Insurance Certificates. On or before the Closing Date, the
Indenture Trustee, the Policy Provider and each Participant shall have received
(x) each certificate relating to insurance that is required pursuant to Section
12 of the Lease and Section 6.4 of the Collateral Agency Agreement and (y)
certificates from a nationally recognized insurance broker substantially in the
forms attached hereto as Exhibits A-1 and A-2 with respect to the public

                                       38

liability insurance required by Section 12.1 (b) of the Lease and Section 6.4 of
the Collateral Agency Agreement.

            (i) Corporate, Partnership, Limited Liability Company and Other
Organizational Documents. Each of the Participants shall have received such
documents and evidence with respect to TILC, TRLTII, Trinity, the Lessee, the
General Partner, the Limited Partner, the Owner Participant, the Pass Through
Trustee, the Owner Trustee and the Indenture Trustee as the Participants may
reasonably request in order to establish the consummation of the transactions
contemplated by this Agreement including corporate charters and by-laws and
other organizational documents, certificates of incumbency and evidence of the
taking of all corporate, limited partnership and other proceedings in connection
herewith or therewith and compliance with the conditions herein or therein.

            (j) No Threatened Proceeding. No action or proceeding shall have
been instituted nor shall governmental action be threatened before any court or
governmental agency, nor shall any order, judgment or decree have been issued or
proposed to be issued by any court or governmental agency at the time of the
Closing Date, to set aside, restrain, enjoin or prevent the completion and
consummation of this Agreement, the Operative Agreements and the Pass Through
Documents or the transactions contemplated hereby or thereby.

            (k) Representations and Warranties of the Owner Participant. On the
Closing Date, the representations and warranties of the Owner Participant
contained in Section 3.4(e) and Section 3.5 hereof shall be true and correct as
of the Closing Date as though then made on and as of such date, except to the
extent that such representations and warranties relate solely to an earlier date
(in which case such representations and warranties were true and correct on and
as of such earlier date), and each of the Lessee, TILC, TRLTII, the Indenture
Trustee, the Policy Provider and the Pass Through Trustee shall have received an
Officer's Certificate to such effect dated such date from the Owner Participant,
and the Owner Participant shall have performed and complied with all agreements
and conditions herein contained which are required to be performed or complied
with by the Owner Participant on or before said date.

            (l) Notice of Delivery. The Indenture Trustee, the Policy Provider
and the Participants shall have received the Notice of Delivery described in
Section 2.3(a).

            (m) Representations and Warranties of the Indenture Trustee. On the
Closing Date, the representations and warranties of the Indenture Trustee
contained in Section 3.3 hereof shall be true and correct as of the Closing Date
as though then made on and as of such date, except to the extent that such
representations and warranties relate solely to an earlier date (in which case
such representations and warranties were true and correct on and as of such
earlier date), and each of the Lessee, TILC, TRLTII, the Trust, the Owner
Trustee and the Participants shall have received an Officer's Certificate to
such effect dated such date from the Indenture Trustee, and the Indenture
Trustee shall have performed and complied with all agreements and conditions
herein contained which are required to be performed or complied with by the
Indenture Trustee on or before said date.

            (n) No Illegality. No change shall have occurred after the execution
and delivery of this Agreement in applicable law or regulations thereunder or
interpretations thereof

                                       39

by regulatory authorities that, in the opinion of any Participant, the Policy
Provider or their respective counsel, would make it illegal for such Participant
or the Policy Provider, as the case may be, to enter into any transaction
contemplated by the Operative Agreements or the Pass Through Documents.

            (o) Participants' Investments. (i) The Owner Participant shall have
made available the Owner Participant's Commitment in the amount specified in,
and otherwise in accordance with, Sections 2.2(a) and 2.3 and (ii) the Loan
Participant shall have made available the Loan Participant's Commitment in the
amount specified in, and otherwise in accordance with, Sections 2.2(b) and 2.3.

            (p) Consents. All approvals and consents of any trustees or holders
of any indebtedness or obligations of the Lessee, TILC and TRLTII, if any,
required to have been obtained in connection with the transactions contemplated
by this Agreement, the other Operative Agreements and the Pass Through Documents
shall have been duly obtained and be in full force and effect.

            (q) Governmental Actions. All actions, if any, required to have been
taken on or prior to the Closing Date in connection with the transactions
contemplated by this Agreement, the other Operative Agreements and the Pass
Through Documents on the Closing Date shall have been taken by any governmental
or political agency, subdivision or instrumentality of the United States, Canada
and Mexico, and all orders, permits, waivers, exemptions, authorizations and
approvals of such entities required to be in effect on the Closing Date in
connection with the transactions contemplated by this Agreement and the other
Operative Agreements on the Closing Date shall have been issued, and all such
orders, permits, waivers, exemptions, authorizations and approvals shall be in
full force and effect, on the Closing Date; provided, that the parties hereto
agree that Lessee shall not be required to make any filings in Mexico with
respect to the perfection of security interests in Mexico.

            (r) Financial Model. The Participants shall have received the
financial model, including, without limitation, the projected cash flows and
cash flow coverages satisfactory in form and substance to the Owner Participant.

            (s) Appointment of Representative. The Owner Trustee shall have
authorized its representative, who shall be an individual designated by the
Lessee and acceptable to the Owner Trustee, to accept the Units being delivered
on the Closing Date from the Lessee and to deliver such Units to the Lessee. The
Lessee shall have authorized its representative (who shall be the same
individual designated by the Lessee under this Section 4.1(s)) to accept
delivery of such Units from the Owner Trustee as Lessor pursuant to the Lease.

            (t) Solvency of the Lessee; Liquidity Reserve Account. The Lessee
shall have furnished to the Participants and the Policy Provider an Officer's
Solvency Certificate (substantially in the form attached hereto as Exhibit F) as
to the solvency of the Lessee as of the Closing Date stating, among other
things, that on the Closing Date (i) the Collection Account has a balance of
$1,637,986 and (ii) the Liquidity Reserve Account has a balance of $4,163,243.

                                       40

(u) Schedule of Subleases, Pledged Equipment Leases, Units and
Pledged Units. The Participants, the Policy Provider and the Collateral Agent
shall have received a schedule, certified by the Lessee and TRLTII, listing each
Existing Equipment Sublease, the Sublessee under each thereof and the Units
covered thereby. The Participants, the Policy Provider and the Collateral Agent
shall have also received a schedule, certified by the Lessee and TRLTII, listing
each Existing Pledged Equipment Lease, the Pledged Equipment Lessee under each
thereof and the Pledged Units covered thereby.

            (v) [Reserved].

            (w) Representations and Warranties of TILC. On the Closing Date, the
representations and warranties of TILC contained in Section 3.4(d) and Section
3.6 hereof shall be true and correct as of the Closing Date as though then made
on and as of such date, except to the extent that such representations and
warranties relate solely to an earlier date (in which case such representations
and warranties were true and correct on and as of such earlier date), and each
of the Trust, the Owner Trustee, the Indenture Trustee and the Participants
shall have received an Officer's Certificate to such effect dated such date from
TILC, and TILC shall have performed and complied with all agreements and
conditions herein contained which are required to be performed or complied with
by TILC on or before said date.

            (x) Representations and Warranties of TRLTII. On the Closing Date,
the representations and warranties of TRLTII contained in Section 3.4(c) and
Section 3.7 hereof shall be true and correct as of the Closing Date as though
then made on and as of such date, except to the extent that such representations
and warranties relate solely to an earlier date (in which case such
representations and warranties were true and correct on and as of such earlier
date), and each of the Trust, the Owner Trustee, the Indenture Trustee and the
Participants shall have received an Officer's Certificate to such effect dated
such date from TRLTII, and TRLTII shall have performed and complied with all
agreements and conditions herein contained which are required to be performed or
complied with by TRLTII on or before said date.

            (y) Representations and Warranties of the Pass Through Trustee. On
the Closing Date, the representations and warranties of the Pass Through Trustee
contained in Sections 3.4(f) and Section 3.8 hereof shall be true and correct as
of the Closing Date as though then made on and as of such date, except to the
extent that such representations and warranties relate solely to an earlier date
(in which case such representations and warranties were true and correct on and
as of such earlier date), and each of the Lessee, TILC, TRLTII, the Indenture
Trustee, the Trust, the Owner Trustee and the Participants shall have received
an Officer's Certificate to such effect dated such date from the Pass Through
Trustee, and the Pass Through Trustee shall have performed and complied with all
agreements and conditions herein contained which are required to be performed or
complied with by the Pass Through Trustee on or before said date.

            (z) Representations and Warranties of Trinity. On the Closing Date,
the representations and warranties of Trinity contained in Sections 3.4(g) and
Section 3.9 hereof shall be true and correct as of the Closing Date as though
then made on and as of such date, except to the extent that such representations
and warranties relate solely to an earlier date (in which case such
representations and warranties were true and correct on and as of such earlier

                                       41

date), and each of the Lessee, TILC, TRLTII, the Indenture Trustee, the Trust,
the Owner Trustee and the Participants shall have received an Officer's
Certificate to such effect dated such date from Trinity, and Trinity shall have
performed and complied with all agreements and conditions herein contained which
are required to be performed or complied with by Trinity on or before said date.

            (aa) Representations and Warranties of the Policy Provider. On the
Closing Date, the representations and warranties of the Policy Provider
contained in Sections 3.4(h) and Section 3.10 hereof shall be true and correct
as of the Closing Date as though then made on and as of such date, except to the
extent that such representations and warranties relate solely to an earlier date
(in which case such representations and warranties were true and correct on and
as of such earlier date), and each of the Lessee, TILC, TRLTII, the Indenture
Trustee, the Trust, the Owner Trustee and the Participants shall have received
an Officer's Certificate to such effect dated such date from the Policy
Provider, and the Policy Provider shall have performed and complied with all
agreements and conditions herein contained which are required to be performed or
complied with by the Policy Provider on or before said date.

            (bb) Taxes. All material Taxes have been paid in connection with the
execution and delivery of this Agreement.

            (cc) Accountant's Letter. The Participants shall have received an
accountant's letter from Deloitte & Touche LLP in form and substance reasonably
satisfactory to each of them.

            (dd) Certificate Rating. On the Closing Date, the Certificates shall
be rated "AAA" by Standard & Poor's, a division of The McGraw-Hill Companies,
Inc., and "Aaa" by Moody's Investors Service.

            (ee) Sublessee and Pledged Equipment Lessee Consents. The Lessee
shall have obtained the consent to assignment from Sublessees under Existing
Equipment Subleases and Pledged Equipment Lessees under Existing Pledged
Equipment Leases, such consents to be in form and substance reasonably
satisfactory to the Participants and the Policy Provider if not in the form
attached hereto as Exhibit D, with respect to a percentage, acceptable to each
Participant and the Policy Provider, of Existing Equipment Subleases relating to
the Equipment and Existing Pledged Equipment Leases relating to the Pledged
Equipment.

            (ff) Execution and Delivery of Other Agreements. The documents
related to the Marks Company, the 2004-1A SUBI Certificate related to the Marks
Company, the Other Participation Agreements and the Other Trust Agreements shall
have been executed and delivered by the respective parties thereto.

            (gg) Delivery of Collection Procedures. TILC shall have provided a
copy of its current collections procedures to the Policy Provider.

      Section 4.2 Additional Conditions Precedent to Investment by the Loan
Participant. The obligation of the Loan Participant to fund the Loan
Participant's Commitment and purchase and pay for the Equipment Note to be
purchased by it pursuant to Sections 2.2(b) and 2.3 on the

                                       42

Closing Date shall be subject to the satisfaction or waiver of the following
additional conditions precedent:

            (a) Equipment Note. The Equipment Note to be delivered on the
Closing Date shall have been duly authorized, executed and delivered to the Loan
Participant by a duly authorized officer of the Owner Trustee and duly
authenticated by the Indenture Trustee.

            (b) Sale of Pass Through Certificates. The Pass Through Certificates
shall have been sold to the Initial Purchasers pursuant to the Certificate
Purchase Agreement.

            (c) Appraisal. The Pass Through Trustee, the Policy Provider and
each Initial Purchaser shall have received the verification of value, useful
life and estimated residual value prepared by the Appraiser in connection with
the Appraisal.

      Section 4.3 Additional Conditions Precedent to Investment by the Owner
Participant. The obligation of the Owner Participant to provide the funds
specified with respect to it in Sections 2.2(a) and 2.3 on the Closing Date with
respect to any Unit to be delivered on the Closing Date shall be subject to the
satisfaction or waiver of the following additional conditions precedent:

            (a) Appraisal. On or before the Closing Date, the Owner Participant
shall have received an opinion (the "Appraisal") of RailSolutions, Inc. (the
"Appraiser"), satisfactory in form and substance to the Owner Participant (with
a separate summary or other evidence of such Appraisal as it relates to fair
market value and useful life being provided to the Rating Agency) provided that
the Lessee makes no representation as to the fair market value, useful life,
fair market rental value or estimated residual value of the Equipment, and the
Lessee shall not be responsible for, or incur any liabilities as a result of,
the contents of such Appraisal or report to which it relates or, except to the
extent provided in the Tax Indemnity Agreement and except as to the written
information provided by the Lessee or TILC to the Appraiser as set forth in
Section 3.2(dd) or 3.6(v).

            (b) Opinion with Respect to Certain Tax Aspects. On the Closing
Date, the Owner Participant shall have received the opinion of Simpson Thacher &
Bartlett LLP, addressed to the Owner Participant, in form and substance
satisfactory to the Owner Participant, containing such counsel's favorable
opinion with respect to such tax matters as the Owner Participant may reasonably
request.

            (c) Absence of Change in Tax Laws. No Change in Tax Law shall have
occurred which would cause an adverse change to the tax assumptions used to
calculate Basic Rent, Stipulated Loss Values, Stipulated Loss Amounts,
Termination Values, Termination Amounts and Early Purchase Price, unless the
adjustment referred to in Section 2.6(a) is made to the Owner Participant's
satisfaction.

            (d) Tax Indemnity Agreement. On or before the Closing Date, the Tax
Indemnity Agreement shall be satisfactory in form and substance to the Owner
Participant, shall have been duly executed and delivered by the Lessee and
Trinity, assuming due authorization, execution and delivery by the Owner
Participant or one of its Affiliates, shall be in full force and effect.

                                       43

(e) Tax Shelter Registration. Each party hereto and their respective
counsel shall have received (i) a copy of Form 8264 ("Application for
Registration of a Tax Shelter) filed with the Internal Revenue Service on a
protective basis; (ii) a copy of the Internal Revenue Service registration
notice containing the registration number which the Internal Revenue Service
issued in connection with such filing; (iii) a written statement in compliance
with Code Section 6111 and Temporary Treasury Regulation section 301.6111-1T
Q/A53; and (iv) a copy of any letters sent to the California Franchise Tax Board
(together with any attachments) in compliance with California Revenue and
Taxation Code section 18628, each attached hereto on Exhibit G.

            (f) Equity Rating. On the Closing Date, the equity portion of Rent
shall be rated at least BBB by S&P.

      Section 4.4 Conditions Precedent to the Obligation of TRLTII and the
Lessee. The obligation of TRLTII with respect to the sale of the Units and the
Pledged Units to the Lessee on the Closing Date, the obligation of the Lessee
with respect to the sale of such Units to the Owner Trustee and the obligation
of the Lessee to accept such Units under the Lease as of the Closing Date is
subject to the satisfaction or waiver of the following conditions precedent:

            (a) Corporate Documents. On or before the Closing Date, the Lessee
shall have received such documents and evidence with respect to the
Participants, the Owner Trustee, the Pass Through Trustee and the Indenture
Trustee as the Lessee may reasonably request in order to establish the
authorization of the consummation of, or otherwise relating to the ability to
consummate, the transactions contemplated by this Agreement and the other
Operative Agreements, the taking of all corporate and other proceedings in
connection therewith and compliance with the conditions herein or therein set
forth.

            (b) Operative Agreements. On or before the Closing Date, the
Operative Agreements shall have been duly authorized, executed and delivered by
the respective party or parties thereto (other than the Lessee, TILC and
TRLTII), and an executed counterpart of each thereof shall have been delivered
to the Lessee or its special counsel.

            (c) Representations and Warranties. On the Closing Date, the
representations and warranties of each of the Owner Trustee, the Indenture
Trustee and the Participants contained in Section 3 hereof shall be true and
correct in all material respects as of the Closing Date as though made on and as
of such date, and the Lessee shall have received an Officer's Certificate to
such effect dated such date from each of the Owner Trustee as described in
Section 4.1(d), the Owner Participant as described in Section 4.1(k), the
Indenture Trustee as described in Section 4.1 (m) and the Pass Through Trustee
as described in Section 4.1(y).

            (d) Opinions of Counsel. On the Closing Date, the Lessee shall have
received the opinions of counsel referred to in Section 4.1(e) (other than that
set forth in clauses (i) and (ii) therein), addressed to the Lessee.

            (e) No Threatened Proceeding. No action or proceeding shall have
been instituted nor shall governmental action be threatened before any court or
governmental agency, nor shall any order, judgment or decree have been issued or
proposed to be issued by any court

                                       44

or governmental agency at the time of the Closing Date, to set aside, restrain,
enjoin or prevent the completion and consummation of this Agreement or the
transactions contemplated hereby.

            (f) No Illegality. No change shall have occurred after the execution
and delivery of this Agreement in applicable law or regulations thereunder or
interpretations thereof by regulatory authorities that, in the opinion of the
Lessee or its counsel, would make it illegal for the Lessee to enter into any
transaction contemplated by the Operative Agreements.

            (g) Participants' Investments. (i) The Owner Participant shall have
made available the Owner Participant's Commitment in the amount specified in,
and otherwise in accordance with, Sections 2.2(a) and 2.3 and (ii) the Loan
Participant shall have made available the Loan Participant's Commitment in the
amount specified in, and otherwise in accordance with, Sections 2.2(b) and 2.3.

            (h) Absence of Change in Tax Laws. No Change in Tax Law shall have
occurred which would cause an increase in the net present value (expressed as a
percentage of Total Equipment Cost) of the Basic Rent (discounted monthly at a
rate per annum equal to the Debt Rate) to exceed 100 basis points.

            (i) No Adverse Accounting Treatment. The Lessee shall not have been
advised by its independent accountants that the Lessee or its affiliates will
not be afforded "off-balance sheet" accounting treatment with respect to the
Lease and the transactions contemplated by the Operative Agreements; provided,
that the Lessee shall not have deliberately caused the loss of "off-balance
sheet" accounting treatment to provoke non-satisfaction of such condition
precedent pursuant to this Section 4.4(i).

SECTION 5. FINANCIAL AND OTHER REPORTS OF THE LESSEE, TILC AND TRINITY.

      Each of the Lessee, TILC and Trinity agrees during the Lease Term and (if
longer, in the event that the Lessee has assumed all of the rights and
obligations of the Lessor under the Indenture in respect of the Equipment Notes)
so long as any Equipment Note remains outstanding, that it will furnish or cause
to be furnished directly to the Policy Provider, the Rating Agency and each
Participant the following:

            (a) as soon as available and in any event within 60 days after the
end of each of the first three quarters of each fiscal year, a balance sheet of
the Lessee, TILC and Trinity as at the end of such quarter, together with the
related consolidated statements of income and cash flows of the Lessee, TILC and
Trinity for the period beginning on the first day of such fiscal year and ending
on the last day of such quarter, setting forth in each case (except for the
balance sheet) in comparative form the figures for the corresponding periods of
the previous fiscal year, all in reasonable detail and prepared in accordance
with generally accepted accounting principles;

            (b) as soon as available and in any event within 120 days after the
last day of each fiscal year, a copy of the Lessee's, TILC's and Trinity's
audited annual report covering the operations of the Lessee, TILC and Trinity,
respectively, including a balance sheet and related statements of income and
retained earnings and statement of cash flows of the Lessee, TILC and

                                       45

Trinity, respectively, for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, all in reasonable
detail and prepared in accordance with generally accepted accounting principles
applied on a consistent basis, which statements will have been certified by a
firm of independent public accountants of recognized national standing selected
by the Lessee, TILC and Trinity, respectively;

            (c) within the time period prescribed in paragraph (a) above, a
certificate, signed by the Treasurer or principal financial officer of the
General Partner, (i) to the effect that such officer is not aware (without any
obligation of due inquiry), as of the date of such certificate, of any Lease
Default, and if a Lease Default shall exist, specifying such Lease Default, the
nature and status thereof and what action Lessee is taking or plans to take with
respect thereto and (ii) setting forth the Historical Coverage Ratio and the
Projected Coverage Ratio as of the last Business Day of the immediately
preceding calendar quarter;

            (d) within the time period prescribed in paragraph (b) above, a
certificate, signed by the Treasurer or principal financial officer of the
General Partner, (i) to the effect that such officer has reviewed the Operative
Agreements and activities and records of the Lessee during the immediately
preceding fiscal year and that, after due inquiry, such officer is not aware, as
of the date of such certificate, of any Lease Default, and if a Lease Default
shall exist, specifying such Lease Default, the nature and status thereof and
what action Lessee is taking or plans to take with respect thereto, (ii) setting
for the Historical Coverage Ratio and the Projected Coverage Ratio as of the
last Business Day of the preceding fiscal year, and (iii) setting forth in
summary terms the Lessee's compliance with Section 8.3 of the Lease as to new
Subleases entered into by the Lessee, and sub-subleases entered into by any
Sublessee, during such fiscal year, including without limitation as to whether
such new Subleases are subject and subordinate to the terms of the Lease;

            (e) promptly after obtaining knowledge thereof, notice of any
pending or threatened action, suit or proceeding against or affecting the Lessee
or any property of the Lessee which action, suit or proceeding could reasonably
be expected to have a material adverse effect on the Lessee or on the interests
of the Lessor, Owner Trustee, Indenture Trustee, Pass Through Trustee or any
Participant under the Operative Agreements or the Pass Through Documents;

            (f) within the time periods presented in Section 7 of the Management
Agreement, each of the reports referred to therein delivered by the Manager to
the Lessee; and

            (g) promptly after request therefor, such additional information
with respect to the financial condition or business of the Lessee as the Owner
Participant, the Indenture Trustee or the Policy Provider may from time to time
reasonably request.

SECTION 6. CERTAIN COVENANTS OF THE PARTICIPANTS, THE TRUSTEES AND THE LESSEE.

      Section 6.1 Restrictions on Transfer of Beneficial Interest. The Owner
Participant agrees that it shall not, directly or indirectly, sell, convey,
assign, pledge, mortgage or otherwise transfer all or any part of the Beneficial
Interest (collectively, for purposes of this Section 6.1, a "transfer") prior to
the expiration or earlier termination of the Lease Term without the Lessee's

                                       46

and, so long as any Equipment Notes are outstanding, the Indenture Trustee's
prior written consent; provided that no such consent shall be required if the
following conditions are satisfied (it being understood that the Indenture
Trustee's consent shall not be required for any waiver of the conditions set
forth in clauses (b) or (k) below):

            (a) the Person to whom such transfer is to be made (a "Transferee")
is not bankrupt or insolvent and, so long as no Lease Event of Default is
continuing, is (i) an institutional or corporate investor with tangible net
worth or, in the case of a bank or lending institution, combined capital and
surplus at the time of such transfer, of at least $75,000,000, determined in
accordance with generally accepted accounting principles, as of the date of such
transfer, or (ii) an Affiliate of an institutional or corporate investor that
satisfies the requirements set forth in clause (i) above if such investor
guarantees pursuant to a guaranty in form and substance reasonably satisfactory
to the Lessee the obligations of the Owner Participant under the Operative
Agreements assumed by such Affiliate as required herein or (iii) an Affiliate of
the Owner Participant; provided that in the event of a transfer pursuant to
clause (iii) which does not qualify under clauses (i) or (ii), the Owner
Participant shall remain liable for all of its obligations under this Agreement
and the other Operative Agreements;

            (b) neither the Transferee nor any of its Affiliates shall compete
(directly or indirectly) (other than as a passive investor or loan participant
in the financing of equipment or facilities used in railcar leasing) with the
Lessee or TILC (unless such non-competition requirement has been waived in
writing by the Lessee and TILC) in any respect material to the full service
railcar leasing business of the Lessee or TILC; provided that this clause (b)
shall not apply (i) to any Transferee that is an Affiliate of the Owner
Participant or (ii) in the event that a Lease Event of Default shall have
occurred and be continuing;

            (c) each of the Indenture Trustee, the Owner Trustee, the Lessee and
the Policy Provider shall have received 10 days prior written notice of such
transfer specifying the name and address of any proposed Transferee and such
additional information as shall be reasonably necessary to determine whether the
proposed transfer satisfies the requirements of this Section 6.1;

            (d) such Transferee enters into an agreement (i) in the form
attached hereto as Exhibit C or (ii) otherwise in form and substance reasonably
satisfactory to each of the Lessee (so long as no Lease Event of Default is
continuing) and the Owner Trustee and not reasonably objected to by the
Indenture Trustee whereby such Transferee confirms that it shall be deemed a
party to this Agreement and each other Operative Agreement to which the
transferring Owner Participant is a party, and agrees to be bound by all the
terms of, and to undertake all of the obligations and liabilities of the
transferring Owner Participant contained in, this Agreement and such other
Operative Agreements and in which the Transferee shall make representations and
warranties comparable to those of the Owner Participant contained herein and
therein;

            (e) an opinion of counsel of the Transferee (which counsel shall be
reasonably acceptable to the Lessee (so long as no Lease Event of Default is
continuing), the Indenture Trustee and the Policy Provider), confirming (i) the
existence, corporate power and authority of, and due authorization, execution
and delivery of all relevant documentation by, the Transferee, (ii) that each
agreement referred to in Section 6.1(d) above is the legal, valid, and binding

                                       47

obligation of the Transferee, enforceable against the Transferee in accordance
with its terms (subject to customary qualifications as to bankruptcy and
equitable principles) and (iii) compliance of the transfer with applicable
requirements of federal securities laws and securities laws of the Transferee's
domicile, shall be provided, prior to such transfer, to each of the Lessee (so
long as no Lease Event of Default is continuing) and the Indenture Trustee,
which opinion shall be in form and substance reasonably satisfactory to the
Lessee (so long as no Lease Event of Default is continuing) and the Indenture
Trustee;

            (f) except as specifically consented to in writing by each of the
Lessee, the Owner Trustee, the Pass Through Trustee, the Indenture Trustee and
the Policy Provider, the terms of the Operative Agreements shall not be altered;

            (g) after giving effect to such transfer, the Beneficial Interest
shall be held by not more than two Persons in the aggregate, except if such
transfer occurs after the occurrence and during the continuance of a Lease Event
of Default;

            (h) all reasonable expenses of the parties hereto (including,
without limitation, reasonable legal fees and expenses of special counsel)
incurred in connection with each transfer of such Beneficial Interest shall be
paid by the transferring or transferee Owner Participant, except if such
transfer occurs after the occurrence and during the continuance of a Lease Event
of Default, provided that the Lessee shall not be obligated to pay such expenses
to the extent that after giving effect to such transfer, the Beneficial Interest
is held by more than two Persons;

            (i) such transfer either (i) does not involve the use of any funds
which constitute assets of an employee benefit plan subject to Title I of ERISA
or Section 4975 of the Code or (ii) if clause (i) is not applicable, will not
constitute a non-exempt prohibited transaction under Section 406(a)(1)(A)
through (D) of ERISA or Section 4975(c)(1)(A) through (D) of the Code;

            (j) as a result of and following such transfer, no Indenture Default
attributable to the Owner Participant or the Owner Trustee shall have occurred
and be continuing;

            (k) unless a Lease Event of Default shall have occurred and is
continuing, the transfer does not involve the sale of the stock of any Owner
Participant, the sole asset of which is all or a portion of the Beneficial
Interest, to, or the merger of any such Owner Participant with or into, any
Person which is a competitor of the Lessee or TILC as described in Section
6.1(b), provided that the Lessee may waive this requirement in writing;

            (l) the Transferee (i) is a U.S. Person, provided that the
Transferee is not a partnership, other flow through entity, or a disregarded
entity, unless such Transferee is owned solely by one or more U.S. Persons or
(ii) is engaged in a United States trade or business for purposes of Subtitle A,
Chapter 1, Subchapter N of the Code and its acquisition of such Beneficial
Interest is effectively connected with such trade or business; and

            (m) the Owner Participant shall deliver to the Lessee an Officer's
Certificate certifying as to compliance with the transfer requirements specified
in clauses (a), (g), (i), (j) and (l) above.

                                       48

Upon any such transfer (i) except as the context otherwise requires, such
Transferee shall be deemed the "Owner Participant" for all purposes, and shall
enjoy the rights and privileges and perform the obligations of the Owner
Participant to the extent of the interest transferred hereunder and under each
other Operative Agreement to which the Owner Participant is a party, and, except
as the context otherwise requires, each reference in this Agreement and each
other Operative Agreement to the "Owner Participant" shall thereafter be deemed
to include such Transferee for all purposes to the extent of the interest
transferred, and (ii) the transferor, except to the extent provided in Section
6.1(1) hereof and except in the case of a transfer to a Transferee described in
the proviso to Section 6.1(a)(iii) hereof, shall be released from all
obligations hereunder and under each other Operative Agreement to which such
transferor is a party or by which such transferor is bound solely to the extent
such obligations are expressly assumed by a Transferee; and provided, further,
that in no event shall any such transfer or assignment waive or release the
transferor from any liability on account of any breach existing prior to such
transfer of any of its representations, warranties, covenants or obligations set
forth herein or in any of the other Operative Agreements or for any fraudulent
or willful misconduct. No Transferee shall be entitled to reimbursement by the
Lessee under Section 7.1 or 7.2 or by TILC under Section 7.3 for any amount that
would exceed the amount that would have been payable by the Lessee or TILC, as
applicable, to the original Owner Participant, as a result of the Transferee
engaging in a business or activity not generally conducted by other
institutional or corporate investors in lease transactions. The Owner
Participant hereby acknowledges and agrees (and each Transferee by virtue of any
transfer shall be deemed to have acknowledged and agreed) to the terms of the
Collateral Agency Agreement. Each Transferee agrees to provide to the Lessee as
soon as practicable after the transfer of the Beneficial Interest to such
Transferee a copy of the agreement and opinion delivered in connection with such
transfer in accordance with the terms of Sections 6.1(d) and (e) if at the time
of such transfer there shall have existed a Lease Event of Default.

      The Lessee agrees to provide notice to the Rating Agency of any proposed
transfer by an Owner Participant no later than ten (10) days after Lessee's
receipt of notice of such proposed transfer from an Owner Participant.

      Section 6.2 Lessor's Liens Attributable to the Owner Participant. The
Owner Participant hereby unconditionally agrees with and for the benefit of each
of the other parties to this Agreement that the Owner Participant shall not
directly or indirectly create, incur, assume or suffer to exist any Lessor's
Lien attributable to the Owner Participant on or against all or any portion of
the Trust Estate, the Indenture Estate or the Equipment or Subleases, and the
Owner Participant agrees that it shall, at its own cost and expense, take such
action as may be necessary to duly discharge and satisfy in full any such
Lessor's Lien; provided that the Owner Participant may contest any such Lessor's
Lien 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 portion of
the Trust Estate, the Indenture Estate, the Equipment or the Subleases or any
interest therein or interference with the use, operation, or possession of the
Equipment or any portion thereof by the Lessee under the Lease or the rights of
the Indenture Trustee under the Indenture.

      Section 6.3 Lessor's Liens Attributable to Trust Company. Trust Company
hereby unconditionally agrees with and for the benefit of each of the other
parties to this Agreement that it shall not directly or indirectly create,
incur, assume or suffer to exist any Lessor's Lien attributable to it on or
against all or any portion of the Trust Estate or the Equipment, the Trust

                                       49

Company agrees that it shall, at its own cost and expense, take such action as
may be necessary to duly discharge and satisfy in full any such Lessor's Lien;
provided that the Trust Company may contest any such Lessor's Lien 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 portion of the Trust
Estate or the Equipment or any interest therein or interference with the use,
operation, or possession of the Equipment or Pledged Equipment or any portion
thereof by the Lessee under the Lease or the right of the Indenture Trustee
under the Indenture.

      Section 6.4 Liens Created by the Indenture Trustee and the Loan
Participant.

            (a) The Indenture Trustee, in its individual capacity, covenants and
agrees with each of the Lessee, the Owner Trustee, the Owner Participant, the
Loan Participant and the Policy Provider that it shall not cause or permit to
exist any Lien on or against all or any portion of the Equipment, the Pledged
Equipment, the Trust Estate or the Indenture Estate arising as a result of (i)
claims against the Indenture Trustee in its individual capacity not related to
its interest in the Equipment, the Pledged Equipment and the Trust Estate, or to
the administration of the Indenture Estate pursuant to the Indenture, (ii) acts
of the Indenture Trustee in its individual capacity not contemplated by, or
failure of the Indenture Trustee to take any action it is expressly required to
perform by, any of the Operative Agreements, (iii) claims against the Indenture
Trustee attributable to the actions of the Indenture Trustee in its individual
capacity relating to Taxes or expenses that are not indemnified against by the
Lessee pursuant to Section 7 or (iv) claims against the Indenture Trustee
arising out of the transfer by the Indenture Trustee of all or any portion of
its interest in the Equipment, the Pledged Equipment, the Indenture Estate or
the Operative Agreements, other than a transfer permitted by the Operative
Agreements and with respect to which the Indenture Trustee will, at its own cost
and expense (and without any right of reimbursement from any other party
hereto), promptly take such action as may be necessary duly to discharge any
such Lien.

            (b) The Loan Participant covenants and agrees with each of the
Lessee, the Owner Trustee, the Owner Participant and the Indenture Trustee that
the Loan Participant shall not cause or permit to exist any Lien on or against
all or any portion of the Equipment, the Pledged Equipment, the Trust Estate or
the Indenture Estate arising as a result of (i) claims against the Loan
Participant not related to its interest in the Equipment, the Pledged Equipment
and the Trust Estate, (ii) acts of the Loan Participant not contemplated by, or
failure of the Loan Participant to take any action it is expressly required to
perform by, any of the Operative Agreements, (iii) claims against the Loan
Participant relating to Taxes or expenses that are not indemnified against by
the Lessee pursuant to Section 7, or (iv) claims against the Loan Participant
arising out of the transfer by the Loan Participant of all or any portion of its
interest in the Equipment, the Pledged Equipment, the Indenture Estate or the
Operative Agreements, other than a transfer permitted by the Operative
Agreements and with respect to which the Loan Participant will, at its own cost
and expense (and without any right of reimbursement from the Lessee), promptly
take such action as may be necessary duly to discharge any such Lien.

      Section 6.5 Covenants of Owner Trustee, Owner Participant and Indenture
Trustee. Each of the Owner Participant and Trust Company, in its individual and
trust capacities, hereby agrees, as to its own actions only and severally and
not jointly, with (a) the Loan Participant and the Indenture Trustee (so long as
the Equipment Notes remain outstanding), not to amend,

                                       50

supplement, or otherwise modify any provision of the Trust Agreement in such a
manner as to adversely affect the rights of the Loan Participant or the
Indenture Trustee without the prior written consent of such party and (b) with
the Lessee, not to terminate or revoke the Trust Agreement or the trust created
by the Trust Agreement prior to the payment in full and discharge of the
Equipment Notes and all other indebtedness secured by the Indenture and the
final discharge thereof. Each of the Trust Company and the Indenture Trustee
agrees, for the benefit of the Lessee and the Owner Participant, to comply with
the provisions of the Indenture and not to amend, supplement, or otherwise
modify any provision of the Indenture except in the manner provided in Article
IX thereof. Notwithstanding anything to the contrary contained herein or in any
of the other Operative Agreements, the Indenture Trustee's obligation to take or
refrain from taking any actions, or to use its discretion (including, but not
limited to, the giving or withholding of consent or approval and the exercise of
any rights or remedies under such Operative Agreement), and any liability
therefor, shall, in addition to any other limitations provided herein or in any
of the other Operative Agreements, be limited by the provisions of the
Indenture.

      Section 6.6 Information. At any time when TILC or Trinity is not subject
to Section 13 or 15(d) of the Exchange Act, TILC and Trinity will promptly
furnish or cause to be furnished to the Initial Purchaser and, upon request of
holders and prospective purchasers of the Pass Through Certificates, to such
holders and purchasers, copies of the information required to be delivered to
holders and prospective purchasers of the Pass Through Certificates pursuant to
Rule 144A(d)(4) under the Securities Act (or any successor provision thereto) in
order to permit compliance with Rule 144A in connection with resales by such
holders of the Pass Through Certificates.

      Section 6.7 Certain Representations, Warranties and Covenants. The Lessee
hereby confirms, for the benefit of each other party hereto, its
representations, warranties and covenants in Article 6 of the Collateral Agency
Agreement, which are hereby incorporated in this Agreement by this reference as
fully as if set forth herein in their entirety.

      Section 6.8 Covenants of the Manager. The Manager hereby confirms, for the
benefit of each other party hereto, the covenants in Article 7 of the Management
Agreement, which are hereby incorporated in this Agreement by this reference as
fully as if set forth herein in their entirety.

      Section 6.9 Lessee's Purchase in Certain Circumstances.

            (a) If (A) the Owner Participant or any Affiliate thereof is or
acquires, is acquired by, merges or otherwise consolidates with any company or
Affiliate thereof who would not be an eligible "Transferee" by reason of Section
6.1(b) (and, in the case of an Affiliate, such entity continues to be an
Affiliate of the Owner Participant after such acquisition, merger or
consolidation), or (B) the Lessee shall have requested a waiver pursuant to
Section 12.3(c) of the Lease and the Lessor and the Owner Participant shall have
refused to grant such waiver or shall have granted such waiver but shall have
refused to further waive the requirement that amounts be deposited in the
Special Insurance Reserves Account pursuant to the Collateral Agency Agreement
in connection with the granting of the initial waiver or any such waiver shall
have expired without being renewed or extended, or (C) the Lessee shall have
elected to purchase, or

                                       51

arrange a purchase of, the Beneficial Interest pursuant to Section 22.1 of the
Lease, the Lessee may elect either to:

                  (i) keep the Lease and the Equipment Notes in place and
require that the Owner Participant, and the Owner Participant agrees to,
transfer its Beneficial Interest in accordance with the terms of Section 6.1
(other than provisions of Sections 6.1(a), (b), (h), (i), (l) and (m)) to the
Lessee or such other transferee as the Lessee may designate (such transfer to
occur on a Determination Date which is designated by the Lessee by written
notice to the Owner Participant not less than 60 days prior to such
Determination Date) at a purchase price (the "Beneficial Interest Purchase
Price") equal to (1) the Equity Portion of Termination Amount as of the date of
such transfer, plus (2) in the case of clause (B) above, the excess, if any, of
the Fair Market Sales Value of the Equipment calculated as of such date over the
Termination Value as of such date, plus (3) the Equity Portion of Basic Rent
accrued and unpaid therefor as of the date of such transfer (exclusive of any
Basic Rent payable on such date), plus (4) without duplication or limitation of
any amount under clauses (1) to (3) above, the sum of the Accumulated Equity
Deficiency Amount and Late Payment Interest related thereto, plus (5) without
duplication or limitation of any amount under clauses (1) to (4) above, that
portion of Supplemental Rent due and unpaid on such date that is payable to the
Owner Participant; provided, however, that, without regard to such Owner
Participant's obligations under the Operative Agreements relating to the period
prior to such transfer, any transfer of the Beneficial Interest pursuant to this
Section 6.9 shall be without additional representations or warranties of or
other liabilities or obligations on such Owner Participant other than those
expressly set forth in the Owner Participant Agreements; provided, further, that
in case such Owner Participant holds less than 100% of the Beneficial Interest
(after excluding any Beneficial Interests held by the Lessee, TILC or any
Affiliate of either thereof), the purchase price for such Owner Participant's
Beneficial Interest shall be equal to (x) (i) the sum of the amounts calculated
under clauses (1), (2), (3) and (4) above multiplied by (ii) a fraction equal to
the portion such Owner Participant's Beneficial Interest bears to 100% of the
Beneficial Interests, plus (y) without duplication or limitation of any amount
under clause (x) above, that portion of Supplemental Rent due and unpaid on such
date that is payable to such Owner Participant; or

                  (ii) on a Determination Date which is designated by the Lessee
by written notice to the Owner Trustee and the Indenture Trustee not less than
60 days prior to such Determination Date, purchase all of the Equipment for a
purchase price equal to (I) the aggregate Termination Amounts for all Units
calculated as of such Determination Date, plus (II) in the case of clause (B) of
the lead paragraph of this Section 6.9(a), the excess, if any, of the Fair
Market Sales Value of the Equipment calculated as of such date over the
Termination Value as of such Determination Date, plus (III) without duplication
or limitation, all other amounts due and owing by the Lessee under the Operative
Agreements with respect to the Equipment, including, without limitation, all
accrued and unpaid Basic Rent therefor as of such Determination Date (exclusive
of any Basic Rent payable on such date), Make-Whole Amount then payable on the
Equipment Notes pursuant to Section 2.10(c) of the Indenture with respect to the
Equipment and Late Payment Premium, if any, due and owing under the Operative
Agreements with respect to the Equipment so that, after receipt and application
of all such payments, (i) the Owner Participant shall be entitled under the
terms of the Collateral Agency Agreement to receive, and does receive, in
respect of all such Units, the sum of the Accumulated Equity Deficiency Amount
(without duplication of any amount provided under clauses (I) - (III) above) and
Late Payment

                                       52

Interest related thereto and any other amounts of Supplemental Rent due and
unpaid on such Determination Date that are payable to the Owner Participant and
(ii) all principal of and interest and Premium, if any, on the Equipment Notes
shall have been paid.

            (b) If the Lessee elects to exercise the option to purchase the
Equipment (as opposed to such Owner Participant's Beneficial Interest) as
provided in Section 6.9(a), the Lessee shall, as the purchase price therefor,
pay the purchase price as specified in Section 6.9(a)(ii) with respect to the
Equipment, together with all other amounts due and owing by the Lessee under the
Operative Agreements, and, without duplication, all Policy Provider Amounts and
Policy Provider Reimbursement Costs due and owing to the Policy Provider.

            (c) In connection with any purchase of the Equipment under this
Section 6.9, the Lessee will make the payments required by Section 6.9(a)(ii)
and 6.9(b) in immediately available funds against delivery of a bill of sale
transferring and assigning to the Lessee all right, title and interest of the
Lessor in and to the Equipment on an "as-is" "where-is" basis and containing a
warranty with respect to the absence of any Lessor's Lien. In such event, the
costs of preparing the bill of sale or other transfer documents and all other
documentation relating to such purchase and the costs of any necessary filings
related thereto will be borne by the Lessee.

            If the Lessee shall fail to fulfill its obligations under Sections
6.9(b) and (c), all of the Lessee's obligations under the Lease and the
Operative Agreements, including, without limitation, the Lessee's obligation to
pay installments of Rent, with respect to the Equipment shall continue.

      Section 6.10 Owner Participant as Affiliate of Lessee. If at any time the
original or any successor Owner Participant shall be an Affiliate of the Lessee
or TILC, such Owner Participant and the Lessee agree that, notwithstanding
Section 9.5(b) of the Indenture (but without limiting the rights of the
Indenture Trustee or the Control Party under the Indenture, including, without
limitation, the rights of the Indenture Trustee to exercise and enforce the
rights of the Owner Trust as set forth in the Indenture), such Owner Participant
will not vote its Beneficial Interest in any respect if there is another Owner
Participant not affiliated with the Lessee, and, if there is no such Owner
Participant not affiliated with the Lessee, such Owner Participant will not vote
its Beneficial Interest to modify, amend or supplement any provision of the
Lease or this Agreement or give, or permit the Owner Trustee to give, any
consent, waiver, authorization or approval thereunder if any such action could
reasonably be expected to adversely affect the Indenture Trustee, any holder of
an Equipment Note or the Policy Provider unless such action shall have been
consented to by the Indenture Trustee.

      Section 6.11 Records; U.S. Income Tax Information. Each of the Lessee and
TILC covenants that it will maintain or cause to be maintained and retain
factual records (to the extent such records are maintained by the Lessee and
TILC respectively, any sublessee, or any trustee for or Affiliate of any
thereof, in the ordinary course of their respective businesses) to enable the
Owner Participant to prepare required United States federal, state and local tax
returns. Upon request of the Owner Participant, the Lessee and TILC,
respectively, shall deliver such records to the Owner Participant at the expense
of the Lessee. In addition, as soon as practicable, the Lessee and TILC,
respectively, shall provide or cause to be provided (at the expense of the
Lessee) to the Owner Participant such information (in form and substance
reasonable satisfactory

                                       53

to the Owner Participant) as the Owner Participant may reasonably request from
and as shall be reasonably available to the Lessee and TILC, respectively, to
enable the Owner Participant to fulfill its tax return filing obligations, to
respond to requests for information, to verify information in connection with
any income tax audit and to participate effectively in any tax contest. Such
information may include, without limitation, information as to the location of
and use of the Equipment from time to time (to the extent such information is
available on the basis of the records regularly maintained by the Lessee and
TILC, respectively, any sublessee, or any trustee for or Affiliate of any
thereof, in the ordinary course of their respective businesses).

      Section 6.12 Mexico Filings. (a) In the event that the Owner Participant
or Policy Provider determines, in the exercise of its reasonable judgment, that,
by reason of any action, suit, claim, proceeding, entry of any judgment or
similar remedy, or the assertion of any Lien or other encumbrance, against any
Unit, the Trust, the Owner Trustee or the Owner Participant, it is prudent to
cause the granting of a security interest and pledge under Mexican law and any
appropriate perfection, filing or analogous actions in respect thereof, then (a)
the Lessee shall engage legal counsel qualified under the laws of Mexico to (x)
prepare appropriate documentation and instruments (including a pledge and
security agreement) for purposes of evidencing a grant by the Owner Trust in
favor of the Indenture Trustee of a security interest in and pledge of in all of
its Units then subject to Subleases with Mexican Sublessees, causing the
perfection (or analogous filings and other actions) with respect to such grant
of a security interest and pledge, causing the registration in Mexico with the
Mexican Railroad Registry or other comparable governmental authority or registry
(as deemed appropriate by such Mexican counsel) of the Owner Trustee's ownership
in such Units then subject to Subleases with Mexican Sublessees and of such
security interest and pledge, and any assignments of any of the foregoing, (y)
deliver to the Owner Trustee, Indenture Trustee and Policy Provider an opinion
of counsel with respect to the matters described in this Section 6.12, and (z)
prepare such other documentation and instruments, and cause any other filings or
registrations, as may be deemed advisable by such Mexican counsel or counsel for
the Owner Trustee, Indenture Trustee or Policy Provider for purposes of
protecting the interests of the Owner Trustee, the Indenture Trustee and the
Policy Provider in such Units and (b) the Owner Trustee and the Indenture
Trustee shall cooperate with the Lessee and the Policy Provider in connection
with the preparation of the documentation and instruments described in clause
(a) and all filings, registrations and other related actions and shall execute,
and deliver such documentation and instruments, together with any additional
documentation or instruments deemed necessary or appropriate by Mexican counsel
for purposes of evidencing, recording, registering or perfecting the interests
purported to be covered thereby, all at the sole cost and expense of the Lessee,
the documents referred to in clauses (a) and (b) above to be in form and
substance reasonably satisfactory to the Owner Participant and the Policy
Provider (it being understood that the Lessee, or the Manager pursuant to
agreement with the Lessee (provided that such amounts paid by the Manager shall
not constitute amounts in respect of Reimbursable Services or Operating Expenses
or other amounts to which the Manager shall be entitled to reimbursement
pursuant to the Operative Agreements), shall pay all such costs and expenses,
including without limitation the cost and expense of Mexican counsel, the cost
and expense of separate legal counsel for the Owner Trustee, for the Indenture
Trustee and for the Policy Provider in connection with the preparation, review,
negotiation, filing and registration of, and other actions contemplated hereby
with respect to, such documentation and instruments and the cost and expense of
translating any such documentation or instruments into Spanish or English, as
applicable, out of its own funds

                                       54

and not from any CAA Account, unless the Policy Provider and the Owner
Participant in their respective sole discretion otherwise agrees (in which case
such costs and expenses shall be deemed to constitute Reimbursable Services or
Operating Expenses, as the case may be, and shall be paid from amounts on
deposit in the Collection Account pursuant to Section 3.4 of the Collateral
Agency Agreement)).

            (b) In the event that the Owner Participant or Policy Provider
determines, in the exercise of its reasonable judgment, that, by reason of any
action, suit, claim, proceeding, entry of any judgment or similar remedy, or the
assertion of any Lien or other encumbrance, against any Pledged Unit or the
Lessee, it is prudent to cause the granting of a security interest and pledge
under Mexican law and any appropriate perfection, filing or analogous actions in
respect thereof, then (a) the Lessee shall engage legal counsel qualified under
the laws of Mexico to (x) prepare appropriate documentation and instruments
(including a pledge and security agreement) for purposes of evidencing a grant
by the Lessee in favor of the Collateral Agent of a security interest in and
pledge of in all of its Pledged Units then subject to Subleases with Mexican
Sublessees, causing the perfection (or analogous filings and other actions) with
respect to such grant of a security interest and pledge, causing the
registration in Mexico with the Mexican Railroad Registry or other comparable
governmental authority or registry (as deemed appropriate by such Mexican
counsel) of the Lessee's ownership in such Pledged Units then subject to
Subleases with Mexican Sublessees and of such security interest and pledge, and
any assignments of any of the foregoing, (y) deliver to the Owner Trustee,
Indenture Trustee and Policy Provider an opinion of counsel with respect to the
matters described in this Section 6.12(b), and (z) prepare such other
documentation and instruments, and cause any other filings or registrations, as
may be deemed advisable by such Mexican counsel or counsel for the Owner
Trustee, Indenture Trustee or Policy Provider for purposes of protecting the
interests of the Owner Trustee, the Indenture Trustee and the Policy Provider in
such Pledged Units and (b) the Owner Trustee and the Indenture Trustee shall
cooperate with the Lessee and the Policy Provider in connection with the
preparation of the documentation and instruments described in clause (a) and all
filings, registrations and other related actions and shall execute, and deliver
such documentation and instruments, together with any additional documentation
or instruments deemed necessary or appropriate by Mexican counsel for purposes
of evidencing, recording, registering or perfecting the interests purported to
be covered thereby, all at the sole cost and expense of the Lessee, the
documents referred to in clauses (a) and (b) above to be in form and substance
reasonably satisfactory to the Owner Participant and the Policy Provider (it
being understood that the Lessee, or the Manager pursuant to agreement with the
Lessee (provided that such amounts paid by the Manager shall not constitute
amounts in respect of Reimbursable Services or Operating Expenses or other
amounts to which the Manager shall be entitled to reimbursement pursuant to the
Operative Agreements), shall pay all such costs and expenses, including without
limitation the cost and expense of Mexican counsel, the cost and expense of
separate legal counsel for the Owner Trustee, for the Indenture Trustee and for
the Policy Provider in connection with the preparation, review, negotiation,
filing and registration of, and other actions contemplated hereby with respect
to, such documentation and instruments and the cost and expense of translating
any such documentation or instruments into Spanish or English, as applicable,
out of its own funds and not from any CAA Account, unless the Policy Provider
and the Owner Participant in their respective sole discretion otherwise agrees
(in which case such costs and expenses shall be deemed to constitute
Reimbursable Services or Operating Expenses,

                                       55

as the case may be, and shall be paid from amounts on deposit in the Collection
Account pursuant to Section 3.4 of the Collateral Agency Agreement)).

      Section 6.13 Certain Releases. (a) TILC agrees to cause the Lessee under
the Lease to use its best efforts (i) in the case of each Acknowledgment Party
(as defined below), to obtain an Acknowledgment, and (ii) in the case of each
Release Party (as defined below), to obtain a Release (as defined below) and
cause to be filed a related PPSA Release Filing (as defined below), in each case
with respect to the applicable Affected PPSA Units leased by the Lessee under
the Lease or pledged by the Lessee under the Collateral Agency Agreement, as
applicable. In the event such Acknowledgments or Releases, as applicable, have
not been obtained for an Affected PPSA Unit and such Affected PPSA Unit becomes
subject to any claim, action or proceeding asserting a priority interest in such
Affected PPSA Unit as a result of the outstanding filing in favor of the Release
Party or Acknowledgment Party, as applicable (which claim, action or proceeding
is not discharged or dismissed within 90 days), then TILC agrees not later than
the fifth Business Day following the conclusion of such 90 day period to
transfer to the Lessee, as a capital contribution in respect of TILC's indirect
100% equity interest in the Lessee, an additional Pledged Unit (each an
"Additional Pledged Unit") for each such Affected PPSA Unit subject to such
claim, action or proceeding. Such Additional Pledged Unit shall be of the same
car type and of the same or newer model year (or otherwise approved by the
Required Beneficiaries, which approval in each case shall not be unreasonably
withheld) as the relevant Affected PPSA Unit, and free and clear of all Liens
(other than Permitted Liens of the type described in clauses (ii), (iv) and (v)
of the definition thereof) and have a fair market value (except to a de minimis
extent), utility and remaining economic useful life at least equal to the
relevant Affected PPSA Unit (assuming such Unit was in the condition required to
be maintained by the terms of the related Lease). Upon such transfer to the
Lessee each Additional Pledged Unit shall automatically, without further action
required, become subject to the Security Interests of the Collateral Agency
Agreement as provided therein, unless and until released therefrom in accordance
with the relevant provisions of the Collateral Agency Agreement.

            (b) In the event that the applicable Sublease related to any
Affected PPSA Unit is terminated or expires, TILC as Manager shall not, and
shall not permit the Lessee to, renew any Sublease with respect to an Affected
PPSA Unit with, or remarket under a new sublease any Affected PPSA Unit to, Nova
(as defined below) or Marsulex (as defined below).

      As used in this subsection,

            "Acknowledgment" means a written letter, acknowledgment, agreement
or similar instrument, executed by an Acknowledgement Party (as defined below)
in favor of TILC and any further assignees of TILC (including assignees of such
assignees) to the effect that any filing under the Applicable PPSA (as defined
below) in favor of such Acknowledgement Party against Nova (as defined below) or
Marsulex (as defined below) does not and will not perfect a "security interest"
(as such term is defined in the Applicable PPSA) in any Affected PPSA Units (as
defined below);

            "Acknowledgment Party" means any of UTLX International Division of
Union Tank Car, Procor Limited, Key Equipment Finance Canada Ltd., GE Capital
Railcar Services

                                       56

Canada Company, Computershare Trust Company of Canada, Xerox Canada Ltd., GE
Capital Vehicle and Equipment Leasing Inc. and Associates Capital Limited;

            "Affected PPSA Units" means Units leased under a Lease, the
applicable Sublessee of which is Nova Chemicals Corporation ("Nova") or Marsulex
Inc. ("Marsulex"), and as to which there exists in favor of an Acknowledgment
Party or a Release Party (as defined below), as applicable, a filing made under
the Personal Property Security Act (Alberta) or the Personal Property Security
Act (Ontario) (as the case may be, the "Applicable PPSA") against Nova or
Marsulex, which filing perfects or could perfect a "security interest" (as such
term is defined in the Applicable PPSA) in any of such Units and which filing
has been recorded prior to the filing against such Sublessee with respect to
such Units made in favor of TILC (and TILC's further identified assignees with
respect to such filing) and TILC or the Lessee shall not have obtained the items
described in Section 6.13(a)(i) or (ii) as applicable;

            "PPSA Release Filings" means financing change statements filed under
the Applicable PPSA by or on behalf of a Release Party having a prior filing
against Nova or Marsulex as described immediately above, the effect of the
filing of such financing change statements is to discharge or exclude from the
coverage under such prior filing the Units as to which Nova or Marsulex is a
Sublessee;

            "Release" means a written agreement or similar instrument, executed
by a Release Party in favor of TILC and any further assignees of TILC (including
assignees of such assignees) to the effect that such Release Party is
irrevocably releasing and disclaiming any interest it or any of its assignees
may have or purport to have in the Affected PPSA Units purported to be covered
by the PPSA filing in the Release Party's favor; and

            "Release Party" means any of The Toronto-Dominion Bank, Pembina
Pipeline Corporation and First Treasury Financial Inc.

      Section 6.14 Waiver, Amendment or Modification of Operative Agreements.
None of the Lessee, TRLTII, TILC, the Trust, the Owner Trustee, the Pass Through
Trustee or the Indenture Trustee shall, without the prior written consent of the
Policy Provider, grant, consent or agree to any waiver of rights under, or
amendment or other modification of, any of the Operative Agreements to which any
of them is a party to the extent that such Operative Agreement or any other
Operative Agreements requires the consent of the Policy Provider (in its
capacity as Policy Provider or Control Party) to any such waiver, amendment or
modification and any such waiver, amendment or modification that is entered into
in contravention of this Section 6.14 shall be null and void and of no force or
effect.

SECTION 7. LESSEE'S INDEMNITIES.

      Section 7.1 General Tax Indemnity.

            (a) Tax Indemnitee Defined. For purposes of this Section 7.1, "Tax
Indemnitee" means the Pass Through Trustee, both in its individual capacity and
as trustee, the Owner Participant, its Affiliates, the Owner Trustee, the Trust
Company, the Indenture Trustee, both in its individual capacity and as trustee,
the Policy Provider (the "Policy Tax Indemnitee"),

                                       57

each of their successors or assigns permitted under the terms of the Operative
Agreements, any officer, director, employee or agent of any of the foregoing,
the Trust Estate and the Indenture Estate; "Equity Tax Indemnitee" means the
Owner Participant, its Affiliates, the Owner Trustee, the Trust Company, and
each of their respective successors, assigns, officers, directors, employees and
agents and the Trust Estate; "Lender Tax Indemnitee" means each Tax Indemnitee
that is not an Equity Tax Indemnitee (for the avoidance of doubt, the Policy Tax
Indemnitee is also a Lender Tax Indemnitee).

            (b) Taxes Indemnified. Except as provided in Section 7.1(c) below,
the Lessee agrees that all payments of Rent pursuant to the Lease and all other
payments made by the Lessee to or for the benefit of any Tax Indemnitee in
connection with the transactions contemplated by the Operative Agreements shall
be free of all withholdings or deductions of any nature whatsoever (and at the
time that any payment is made upon which any withholding or deduction is
required, the Lessee shall pay an additional amount such that the net amount
actually received will, after such withholding or deduction and on an After-Tax
Basis, equal the full amount of the payment then due) and shall be free of
expense to each Tax Indemnitee for collection or other charges. The Lessee shall
defend, indemnify and save harmless each Tax Indemnitee from and against, and as
between the Lessee and each Tax Indemnitee, the Lessee hereby assumes liability
with respect to, on an After-Tax Basis all fees (including, without limitation,
documentation, recording, filing, license and registration fees), taxes
(including, without limitation, those in the nature of net or gross income,
gross receipts, franchise, sales, use, value added, ad valorem, rent, turnover,
transfer, excise, doing business, real, personal and intangible property and
stamp taxes), assessments, levies, imposts, duties, charges or withholdings of
any nature whatsoever, together with any and all penalties, additions to tax,
fines or interest thereon and any liabilities, losses, expenses or costs related
thereto (collectively, "Taxes"), which at any time may be levied, assessed or
imposed by the United States federal, any state or local authority or any
foreign governmental authority (or political subdivision thereof) upon, with
respect to, or against any of the Tax Indemnitees, any item of Equipment,
Pledged Equipment, any Sublease, the Lease, any portion of the Collateral, any
Operative Agreement, or any interest in, portion of, or user of, any of the
foregoing, upon, arising from or relating to:

                  (i) any item of the Equipment or the Pledged Equipment, any
Sublease or any portion of the Collateral (including any Account),

                  (ii) the construction, manufacture, financing, acquisition,
purchase, delivery, ownership, acceptance, rejection, possession, improvement,
use, operation, leasing, subleasing, condition, maintenance, repair,
refinancing, registration, sale, return, replacement, storage, insuring,
activity conducted on, substitution of, abandonment, alteration, modification,
imposition of a Lien on, or other application or disposition of any item of the
Equipment or the Pledged Equipment or any portion thereof or interest therein,

                  (iii) the rental payments, receipts or earnings arising from
any item of the Equipment or the Pledged Equipment or payable pursuant to the
Operative Agreements, or

                  (iv) the Operative Agreements, the Partnership Documents, the
Pass Through Documents, the Equipment Note or any Sublease or any Pledged
Equipment Lease, and any payment made or accrued or obligation incurred pursuant
thereto or otherwise with respect

                                       58

to or in connection with the transactions contemplated thereby or the issuance
acquisition, transfer or refinancing of the Equipment Notes.

            (c) Taxes Excluded. The indemnity provided in Section 7.1 (b) shall
not include:

                  (i) as to any Equity Tax Indemnitee, any Income Tax imposed by
the United States federal government (but not excluding any Income Tax required
to make a payment on an After-Tax Basis);

                  (ii) as to any Equity Tax Indemnitee, any Income Tax imposed
by any state, local or foreign government or taxing authority or subdivision
thereof (but not excluding an Income Tax required to make a payment on an
After-Tax Basis); provided, however, that this exclusion shall not apply to the
extent such Taxes relate directly or indirectly to (I) the use, location of any
item of the Equipment or the activities of the Lessee in the taxing
jurisdiction, (II) the presence or organization of the Lessee in the taxing
jurisdiction, (III) any payment by or on behalf of the Lessee being made from
the taxing jurisdiction, or (IV) the execution or delivery of any Operative
Agreement by the Lessee in the taxing jurisdiction; provided, further, however,
that the preceding proviso shall not apply to any Taxes that are solely
attributable to the fact that the Owner Trust, the Owner Trustee (other than in
its individual capacity) or the Owner Participant or any Related Party thereto
has its legal domicile or a principal place of business in the taxing
jurisdiction (determined without regard to the transactions contemplated by the
Operative Agreements or any similar lease transaction between the Owner
Participant and the Lessee or an Affiliate of the Lessee);

                  (iii) as to any Equity Tax Indemnitee, any Tax that is imposed
as a result of the voluntary sale, transfer or other disposition, or any
involuntary sale, transfer or other disposition resulting from a bankruptcy or
similar proceeding for relief of debtors in which such Equity Tax Indemnitee is
a debtor, by the Lessor or the Owner Participant of any of its rights with
respect to any item of Equipment or the Owner Participant's interest in the
Trust Estate unless such sale, transfer or other disposition is during the
continuance of a Lease Event of Default or is otherwise pursuant to the Lessor's
exercise of its rights under the Operative Agreements or is as a result of (x)
any substitution, replacement, improvement, modification or addition to the
Equipment or any portion thereof by the Lessee, a Sublessee, or a Related Party
to the Lessee or Sublessee, (y) a requirement of the Lessee in the Operative
Agreements or under applicable law, or (z) a purchase of the Equipment or any
Unit thereof pursuant to the Lease or the other Operative Agreements;

                  (iv) as to any Equity Tax Indemnitee, any Taxes to the extent
they exceed the Taxes that would have been imposed if such Equity Tax Indemnitee
were a U.S. Person;

                  (v) Taxes imposed on a Lender Tax Indemnitee, excluding the
Policy Tax Indemnitee, with respect to any period after the payment in full of
the Equipment Notes; provided that the exclusion set forth in this clause (v)
shall not apply to Taxes to the extent such Taxes (I) relate directly or
indirectly to events occurring or matters arising prior to or simultaneously
with the date on which all of the principal of, interest on and all other
amounts

                                       59

payable in respect of the Equipment Notes have been paid in full or (II) result
from a Lease Event of Default that has occurred and is continuing;

                  (vi) Taxes imposed on the Policy Tax Indemnitee with respect
to any period after the payment in full of all Equipment Notes, all Policy
Provider Amounts and Policy Provider Reimbursement Costs; provided that the
exclusion set forth in this clause (vi) shall not apply to Taxes to the extent
such Taxes (I) relate directly or indirectly to events occurring or matters
arising prior or simultaneously with the date on which all of the principal of,
interest on and other amounts payable in respect of the Equipment Notes, all
Policy Provider Amounts and all Policy Provider Reimbursement Costs have been
paid in full or (II) result from a Lease Event of Default that has occurred and
is continuing;

                  (vii) as to any Tax Indemnitee, Taxes to the extent caused by
any misrepresentation or breach of warranty or covenant by such Tax Indemnitee
or a Related Party of such Tax Indemnitee under any of the Operative Agreements
(except to the extent such misrepresentations or breach is attributable to any
act or omissions of the Lessee or any sublessee, transferee or assignee of the
Lessee) or by the gross negligence or willful misconduct of such Tax Indemnitee
or such Related Party;

                  (viii) as to any Lender Tax Indemnitee, Taxes that become
payable as a result of a voluntary sale, assignment, transfer or other
disposition, or any involuntary sale, transfer or other disposition resulting
from a bankruptcy or similar proceeding for relief of debtors in which such
Lender Tax Indemnitee is a debtor, by such Lender Tax Indemnitee of all or any
portion of its interest in the Equipment or any part thereof, the Equipment
Notes, the Trust Estate, the Indenture Estate or any of the Operative Agreements
or rights created thereunder; provided, however, that is this clause (viii)
shall not apply in the case of any sale assignment, transfer or other
disposition (whether voluntary of involuntary) which occurs as a result of or
while a Lease Event of Default has occurred and is continuing or which occurs as
a result of (v) the exercise of remedies for a Lease Event of Default, (w) any
substitution, replacement, improvement, modification or addition to the
Equipment or any portion thereof by a Lessee, Sublessee or a Related Party to
the Lessee or Sublessee, (x) a requirement in the Operative Agreements or under
applicable law, (y) a purchase of the Equipment or any Unit thereof pursuant to
the Lease or the other Operative Agreements or (z) any assignment to the Policy
Provider pursuant to the Policy Provider Documents;

                  (ix) as to any Lender Tax Indemnitee, Taxes imposed as the
result of such Lender Tax Indemnitee not being a U.S. Person;

                  (x) as to any Lender Tax Indemnitee, Income Taxes or transfer
taxes relating to any payments of principal of, interest on or Make Whole Amount
or other amounts in respect thereof, if any, on the Equipment Notes or the Pass
Through Certificates paid to such Tax Indemnitee provided, that this clause (x)
should not be interpreted to prevent any payment from being made on an After-Tax
Basis, and provided further that this clause (x) shall not apply to Taxes
attributable to (I) the use or location of any item of Equipment or the
activities of the Lessee in the taxing jurisdiction, (II) the presence or
organization of the Lessee in the taxing jurisdiction or (III) the execution or
delivery of any Operative Agreement in the taxing jurisdiction; provided,
further, however, the preceding provision shall not apply to any

                                       60

jurisdiction where such Lender Tax Indemnitee or any Related Party of such
Lender Tax Indemnitee has its legal domicile or a place of business (determined
without regard to the transitions contemplated by the Operative Agreements);

                  (xi) Taxes to the extent directly resulting from or that would
not have been imposed but for (x) in the case of Taxes imposed on or with
respect to any Equity Tax Indemnitee, the existence of any Lessor Liens with
respect to such Equity Tax Indemnitee, or (y) in the case of Taxes imposed on or
with respect to any Lender Tax Indemnitee, the existence of any Liens
attributable to the Indenture Trustee that are unrelated to the transactions
contemplated by the Operative Agreements or Liens attributable to the Pass
Through Trustee that are unrelated to the transactions contemplated by the
Operative Agreements;

                  (xii) Taxes imposed on a Tax Indemnitee to the extent that
such Taxes would not have been imposed upon such Tax Indemnitee but for any
failure of such Tax Indemnitee or a Related Party of such Tax Indemnitee to
comply with (x) any certification, information, documentation, reporting or
other similar requirements concerning the nationality, residence, identity or
connection with the jurisdiction imposing such Taxes, if such compliance is
required under the laws or regulations of such jurisdiction to obtain or
establish relief or exemption from or reduction in such Taxes and the Tax
Indemnitee or such Related Party was eligible to comply with such requirement or
(y) any other certification, information, documentation, reporting or other
similar requirements under the Tax laws or regulations of the jurisdiction
imposing such Taxes that would establish entitlement to otherwise applicable
relief or exemption from such Taxes and the Tax Indemnitee or such Related Party
was eligible to comply with such requirement; provided, however, that the
exclusion set forth in this clause (xii) shall not apply (I) if such failure to
comply was due to a failure of the Lessee to provide such Tax Indemnitee
reasonable assistance on request in complying with such requirement, (II) if in
the good faith judgment of such Tax Indemnitee there is a risk of adverse
consequence to such Tax Indemnitee or any Affiliate from such compliance against
which such Tax Indemnitee is not satisfactorily indemnified, or (III) in the
case of any Tax Indemnitee, unless Lessee shall have given such Tax Indemnitee
prior timely written notice of such requirements;

                  (xiii) as to the Equity Tax Indemnitee, Taxes that are imposed
with respect to any period after both of the following shall have occurred: (x)
the termination of the Lease Term pursuant to Section 6, 10, 11 or 22 of the
Lease (unless the Equipment is thereafter required to be returned, in which
case, after such return) and (y) the payment by the Lessee of all amounts due
and owing by it to the Equity Tax Indemnitee under the Lease and other Operative
Agreements; provided, however, that the exclusion set forth in this clause
(xiii) shall not apply (I) to Taxes to the extent such Taxes relate to events
occurring or matters arising prior to or simultaneously with such return or
termination and (II) so long as a Lease Event of Default has occurred and is
continuing;

                  (xiv) as to any Lender Tax Indemnitee, Taxes in the nature of
an intangible or similar tax upon or with respect to the value of the interest
of such Lender Tax Indemnitee in the Indenture Estate, in any Equipment Note or
Pass Through Certificate imposed as a result of such Lender Tax Indemnitee or
any Affiliate of such Lender Tax Indemnitee being organized in, or conducting
activities unrelated to the contemplated transactions in, the jurisdiction
imposing such Taxes, provided however, that this exclusion shall not apply to
the

                                       61

incremental amount of such taxes that arise from such Lender Tax Indemnitee's
participation in the transactions contemplated herein;

                  (xv) Taxes imposed on the Owner Trustee, the Pass Through
Trustee or the Indenture Trustee that are on, based on or measured by any
trustee fees for services rendered by such Tax Indemnitee;

                  (xvi) Except as set forth in Section 7.2, Taxes imposed on any
Tax Indemnitee, or any other person who, together with such Tax Indemnitee, is
treated as one employer for employee benefit plan purposes, as a result of, or
in connection with, any "prohibited transaction," within the meaning of the
provisions of the Code or regulations thereunder or as set forth in Section 406
of ERISA or the regulations implementing ERISA or Section 4975 of the Code or
the regulations thereunder;

                  (xvii) Taxes for so long as (x) such Taxes are being contested
in accordance with the provisions of Section 7.1 (e) hereof, (y) the Lessee is
in compliance with its obligations under Section 7.1(e), and (z) the payment of
such Taxes is not required pursuant to Section 7.1(e); provided, however, that
with respect to a Lender Tax Indemnitee this clause (xvii) shall only apply so
long as the non-payment of the contested Tax does not result in any Lender Tax
Indemnitee failing to receive all required payments when due under the Equipment
Notes;

                  (xviii) as to any Equity Tax Indemnitee, Taxes as to which
such Tax Indemnitee is indemnified pursuant to the Tax Indemnity Agreement;

                  (xix) any Taxes imposed on or with respect to any
Certificateholder;

                  (xx) Taxes imposed on a Tax Indemnitee as a result of the
authorization or giving of any future amendments, supplements, waivers or
consents by such Tax Indemnitee with respect to any Operative Agreement other
than (w) in connection with the exercise of remedies pursuant to Section 15 of
the Lease or while a Lease Event of Default has occurred and is continuing, (x)
such as have been proposed by the Lessee or consented to by the Lessee in
writing, (y) those that are required by applicable law or pursuant to the terms
of the Operative Agreements, or (z) those that may be necessary or appropriate
to, and are in conformity with, any amendment, supplement, waiver or consent
proposed by the Lessee or consented to by the Lessee in writing;

                  (xxi) Taxes imposed under Section 6707 or Section 6708 of the
Code or with respect to provisions of state or local law similar to Sections
6707 and 6708 of the Code; provided, however, that this clause (xxi) shall not
apply to any Taxes imposed under Section 6707(a) to the extent such Taxes arise
(x) as a result of the Lessee or any Sublessee providing the Designated
Organizer, (within the meaning of Temporary Treasury Regulation Section
301.6111-1T, Q/A 38 and 39) any false or misleading information or (y) as a
result of the Lessee failing to provide the Designated Organizer or Tax
Indemnitee with any item of information that is required under Section 6111 or
Section 6112 of the Code or the regulations promulgated thereunder, which the
Lessee possesses, that is requested by the Designated Organizer or Tax
Indemnitee from the Lessee; and

                                       62

(xxii) other than as addressed in clause (xxi) of this Section
7.1(c), interest, penalties and additions to tax that would not have been
imposed but for the failure of a Tax Indemnitee to file any required document
timely and properly, except to the extent that such failure is the direct result
of Lessee's breach of its obligations under Section 7.1(g) or of a Lease Event
of Default.

For purposes of this section 7.1(c), any reference to the Lessee shall include
the Lessee and any Related Party of the Lessee. Furthermore, the activities
described in Section 7.1(m) shall not constitute an event described in any of
the exclusions of this Section 7.1(c).

            (d) Payments to Tax Indemnitee. The Lessee agrees to pay, on demand,
any and all Taxes indemnified under this Section 7.1 ("Indemnified Taxes"), and
to keep at all times all and every part of each Unit and Pledged Equipment free
and clear of all Indemnified Taxes which might in any way affect the interest of
any Tax Indemnitee in or result in a Lien upon any such Unit or Pledged
Equipment; provided, however, that the Lessee shall be under no obligation to
pay any Tax so long as either the Tax Indemnitee or the Lessee is contesting
such Tax in good faith, in a manner consistent with this Section 7.1, and by
appropriate legal proceedings.

            Subject to Section 7.1(e), if any Indemnified Taxes shall have been
charged or levied against any Tax Indemnitee directly and paid by such Tax
Indemnitee after such Tax Indemnitee shall have given written notice thereof to
the Lessee and the same shall have remained unpaid for a period of ten Business
Days thereafter, the Lessee shall reimburse such Tax Indemnitee payment.

            (e) Contests. If a written claim is made by any taxing authority
against a Tax Indemnitee for any Taxes with respect to which the Lessee may be
required to indemnify against hereunder or if a Tax Indemnitee shall determine
that any tax to which the Lessee may have an indemnity obligation hereunder may
be payable (a "Tax Claim"), then such Tax Indemnitee shall give the Lessee
written notice of such Tax Claim promptly (but in any event within twenty (20)
days after its receipt of the written Tax Claim or its determination, as
applicable), and shall furnish Lessee with copies of such Tax Claim and all
other writings received from the taxing authority to the extent relating to such
claim (but failure to so notify the Lessee shall not relieve the Lessee of its
obligations hereunder except to the extent that it effectively precludes the
ability of the Lessee to conduct a contest of the Tax Claim). The Tax Indemnitee
shall not pay such Tax Claim until at least thirty (30) days after providing the
Lessee with such written notice, unless (a) the Tax Indemnitee is required to do
so by law or regulation or the failure to pay such Tax Claim could result in a
material adverse financial, legal or other consequence to the Tax Indemnitee and
(b) in the written notice described above, the Tax Indemnitee has notified the
Lessee of such requirement or such material adverse consequence (such notice
however shall not require the disclosure of the Tax Indemnitee's confidential
information, as determined in the sole discretion of such Tax Indemnitee, or the
Tax Indemnitee's tax returns, books, or records). If the Lessee shall so request
within 30 days after receipt of such notice (or such shorter period as is
reasonably specified by the Tax Indemnitee if any contest of the Tax must be
commenced prior to the expiration of 30 days), then such Tax Indemnitee shall in
good faith at Lessee's sole expense contest such Tax or permit the Lessee to
contest such Tax, as such Tax Indemnitee shall elect; provided, however, that to
the extent (i) the contest involves only Taxes constituting property taxes,
sales taxes, or use taxes, (ii) the contest does not involve any taxes that the
Lessee

                                       63

is not required to indemnify the Tax Indemnitee or taxes and other issues
relating to a Tax Indemnitee that are unrelated to the transactions contemplated
by the Operative Agreements, (iii) the contest can be pursued in the name of the
Lessee and independently from any other proceeding involving a Tax Claim of a
Tax Indemnitee for which Lessee has not agreed in writing to indemnify such Tax
Indemnitee, and (iv) no Equity Insufficiency Circumstance exists, such contest
shall be undertaken by the Lessee at the Lessee's sole expense and the after-tax
costs of the Lessor, the Owner Participant, or other Tax Indemnitee shall be
reimbursed by the Lessee. Notwithstanding the preceding sentence, if (a) such
contest would involve any other type of Tax, any taxes that the Lessee is not
required to indemnify the Tax Indemnitee or taxes and other issues relating to a
Tax Indemnitee which are unrelated to the transactions contemplated by the
Operative Agreements, (b) the Tax Indemnitee determines that such contest
conducted by the Lessee could have a material adverse impact on such Tax
Indemnitee's business or operations or involve risk of the imposition of
criminal liability on a Tax Indemnitee, or (c) an Equity Insufficiency
Circumstance exists, then such Tax Indemnitee may, in its sole discretion,
control such contest (including selecting the forum for such contest, and
determining whether any such contest shall be conducted by (i) paying such Tax
under protest or (ii) resisting payment of such Tax or (iii) paying such Tax and
seeking a refund thereof; provided, however, that at such Tax Indemnitee's
option, such contest shall be conducted by the Lessee in the name of such Tax
Indemnitee). In no event shall such Tax Indemnitee be required or the Lessee be
permitted to contest any Tax for which the Lessee is obligated to indemnify
pursuant to this Section 7.1 unless: (i) the Lessee shall have acknowledged in
writing (x) that it is solely responsible for any Indemnified Tax resulting from
any contest under its control, (y) its liability to such Tax Indemnitee for all
reasonable out of pocket costs, losses and expenses that the Tax Indemnitees may
incur in connection with contesting the Indemnified Tax (including, but not
limited to, any reasonable legal, accounting and investigatory fees and
disbursements), and (z) its liability for an indemnity payment pursuant to this
Section 7.1 as a result of such claim if and to the extent such Tax Indemnitee
or the Lessee, as the case may be, shall not prevail in the contest of such
claim; provided, however, that the Lessee shall not be required to indemnify for
such Taxes to the extent the results of the contest clearly demonstrate that the
Tax is not an Indemnified Tax unless the Lessee's conduct of the contest
materially prejudiced the Tax Indemnitee; (ii) such Tax Indemnitee shall have
received the opinion of independent tax counsel selected by the Tax Indemnitee
and reasonably satisfactory to the Lessee and furnished at the Lessee's sole
expense, opining that a reasonable basis exists for contesting such claim or, in
the event of an appeal of an adverse court or administrative agency decision,
that as a result of a change in law or fact it is more likely than not that an
appellate court or an administrative agency or decision making body with
appellate jurisdiction, as the case may be, will reverse or substantially modify
the adverse determination; (iii) the Lessee shall have agreed to pay such Tax
Indemnitee on demand (and at no after tax costs to the Lessor, the Owner
Participant and any Tax Indemnitee) all reasonable costs and expenses that such
Tax Indemnitee may incur in connection with contesting such claim (including,
without limitation, all reasonable legal and accounting fees and disbursements);
(iv) no Lease Default described in Section 14(a), 14(b), 14(c), 14(g) or 14(h)
of the Lease or a Lease Event of Default shall have occurred and shall have been
continuing, unless the Tax Indemnitee in its sole discretion exercised in good
faith allows the Lessee to post a satisfactory bond or other security that does
not involve a possibility of a Lien on the Equipment or any portion thereof or
on any interest therein, and which bond or other security will be for an amount
equal to the sum of (I) the costs of such contest (as reasonably estimated by
such Tax Indemnitee

                                       64

in good faith) and the Taxes which may be required to be indemnified and (II) if
such Lease Default or Lease Event of Default involves a payment obligation under
an Operative Agreement that is currently not paid in full, the unpaid amount of
such obligation, plus the present value of the amounts not yet due pursuant to
such obligation; (v) such Tax Indemnitee shall have determined that the action
to be taken will not result in any risk of sale, forfeiture or loss of, or the
creation of any Lien, or the Lessee shall have or otherwise made a provision to
protect the interest of such Tax Indemnitee (in a manner satisfactory to such
Tax Indemnitee in its sole discretion), on the Equipment or any portion thereof
or any interest therein; (vi) the amount of such claims alone, or, if the
subject matter thereof shall be of a continuing or recurring nature, when
aggregated with substantially identical potential claims with respect to the
transactions contemplated by the Operative Agreements shall be at least $25,000;
(vii) if such contest shall be conducted in a manner requiring the payment or
deposit of the claim, the Lessee shall have paid the amount required (and at no
after-tax costs to the Lessor, the Owner Participant or other Tax Indemnitee);
and (viii) there is no risk of imposition of criminal liability or penalties.
The Lessee shall cooperate with the Tax Indemnitee in good faith with respect to
any contest controlled and conducted by the Tax Indemnitee and the Tax
Indemnitee in good faith shall consult with the Lessee regarding the conduct of
such contest. A Tax Indemnitee shall not be required to pursue an appeal to the
U.S. Supreme Court or the highest court in Canada or Mexico. The Tax Indemnitee
shall cooperate with respect to any contest controlled and conducted by the
Lessee and the Lessee shall consult with the Tax Indemnitee regarding the
conduct of such contest.

            Notwithstanding anything to the contrary contained in this Section
7.1, no Tax Indemnitee shall be required to contest any claim if the subject
matter thereof shall be of a continuing or recurring nature and shall have
previously been adversely decided to the Tax Indemnitee pursuant to the contest
provisions of this Section 7.1 unless there shall have been a change in the law
(including, without limitation, amendments to statutes or regulations,
administrative rulings (excluding private letter rulings and other rulings or
materials that may not be relied upon by such Tax Indemnitee as precedent) or
court decisions in the applicable jurisdiction) enacted, promulgated or
effective after such claim shall have been so previously decided, and such Tax
Indemnitee shall have received an opinion of independent tax counsel selected by
the Tax Indemnitee and reasonably satisfactory to the Lessee, furnished at the
Lessee's sole expense, to the effect that such change is favorable to the
position which such Tax Indemnitee or the Lessee, as the case may be, had
asserted in such previous contest and as a result of such change, it is more
likely than not that the Tax Indemnitee will prevail or, in the event of an
appeal of an adverse court or administrative agency decision, that it is more
likely than not that an appellate court or an administrative agency tribunal or
decision making body with appellate jurisdiction, as the case may be, will
reverse or substantially modify the adverse determination.

            Notwithstanding anything contained in this Section 7.1, a Tax
Indemnitee will not be required to contest the imposition of any Tax and shall
be permitted to settle or compromise any claim without the Lessee's consent if
such Tax Indemnitee (A) shall waive its right to indemnity under this Section
7.1 with respect to such Tax (and any claim the outcome of which is determined
based upon the outcome of such claim) and (B) shall pay to the Lessee any amount
previously paid or advanced by the Lessee pursuant to this Section 7.1 with
respect to such Tax

                                       65

Claim, less any reasonable costs and expenses of the Tax Indemnitee prior to
such payment in respect of such Tax Claim.

            (f) Payments to Lessee. With respect to any payment or indemnity
hereunder, such payment or indemnity shall have included an amount payable to
the Tax Indemnitee sufficient to hold such Tax Indemnitee harmless on an
After-Tax Basis from all Taxes required to be paid by such Tax Indemnitee with
respect to such payment or indemnity under the laws of any federal, state or
local government or taxing authority in or of the United States, or under the
laws of any taxing authority or governmental subdivision in or of a foreign
country; provided that, if both (w) any Tax Indemnitee determines in it sole
discretion that is has recognized either (1) a credit or refund of any
Indemnified Tax, or (2) a reduction in Taxes that are not Indemnified Taxes, in
either case as a result of the Lessee's indemnity or payment under this Section
7.1; and (x) such credit, refund or reduction was not taken into account in
computing such payment or indemnity by the Lessee ("Tax Savings"), then such Tax
Indemnitee shall pay to the Lessee an amount equal to the excess of: (y) such
Tax Savings, over (z) the sum of (I) any tax benefit realized by the Lessee as a
result of this payment by such Tax Indemnitee, plus (II) any Taxes imposed on
such Tax Indemnitee by reason of its receipt or accrual of the Lessee's
indemnity or payment; provided further that, (i) if at the time such payment
shall be due to the Lessee, a Lease Event of Default shall have occurred and be
continuing, such amount shall not be payable until such Lease Event of Default
shall have been cured, and (ii) the amount that such Tax Indemnitee shall be
required to pay to the Lessee shall not exceed the amounts that the Lessee has
theretofore paid such Tax Indemnitee under this Section 7.1 with respect to such
indemnity relating to the same Tax Claim, less the amount of all prior payments
made to the Lessee in respect of such indemnity or a substantially identical
indemnity under this section 7.1(f). If it is subsequently determined that the
Tax Indemnitee was not entitled to such tax benefit for which payment was made
to the Lessee hereunder, the amount of such tax benefit that is required to be
repaid or recaptured will be treated as Taxes for which the Lessee must
indemnify the Tax Indemnitee pursuant to this Section 7.1 without regard to
paragraph (c) hereof.

            For purposes of this Section 7.1, in determining the order in which
the consolidated (for federal income tax purposes) group to which such Tax
Indemnitee belongs utilizes withholding or other foreign taxes as a credit
against such group's United States income taxes, such Tax Indemnitee (and such
group) shall be deemed to utilize (i) first, all foreign taxes other than those
described in clauses (ii) and (iii) below; provided, however, that such other
foreign taxes that are carried back to the taxable year for which a
determination is being made pursuant to such clause (i) shall be deemed utilized
after the foreign taxes described in clause (ii) below, (ii) then, on a pari
passu basis, the foreign taxes indemnified hereunder together with all other
foreign taxes (including fees, taxes and other charges hereunder) with respect
to which such Tax Indemnitee (or any member of such group) is entitled to obtain
indemnification pursuant to an indemnification provision contained in any lease,
loan agreement, financing document or participation agreement (including,
without limitation, this Agreement) pursuant to which there is an agreement that
foreign taxes shall be, or shall be deemed to be, utilized on a basis no less
favorable to the indemnitor than those contemplated in this paragraph, and (iii)
third, foreign taxes attributable to transactions entered into by such Tax
Indemnitee (or any member of such group) that did not provide for foreign taxes
to be utilized or deemed utilized on at least a pari passu basis.

                                       66

(g) Reports. In the event any reports, returns or statements ("Tax
Reports") are required to be filed with respect to Indemnified Taxes, or
otherwise materially impact a Tax Indemnitee in respect of a Tax, the Lessee
will notify the Tax Indemnitee in writing of such requirement not later than 30
days prior to the date such Tax Reports are required to be filed (determined
without regard to extensions), and will either prepare and timely file such Tax
Reports (in the manner required by applicable law or regulation and in the case
of Tax Reports which are required to be filed on the basis of individual Units,
such reports shall be prepared and filed in such manner as to show, if required,
the interest of each Tax Indemnitee in such Units) and send a copy thereof to
the Tax Indemnitee or, if so directed by the Tax Indemnitee or if it shall not
be permitted to file the same, it will notify each Tax Indemnitee of such
reporting requirements, prepare such reports in such manner as shall be
satisfactory to each Tax Indemnitee and deliver the same to each Tax Indemnitee
within a reasonable period prior, and in no event later than 20 Business Days
prior to, to the date the same is to be filed. The Lessee shall provide, at its
expense, such information as the Owner Participant, the Lessor or other Tax
Indemnitee may reasonably require and request from the Lessee to enable the
appropriate Tax Indemnitees to fulfill their respective tax filing, tax audit,
tax litigation and other tax related obligations.

            (h) Survival. In the event that, during the continuance of this
Agreement, any Indemnified Tax accrues, becomes payable or is levied or assessed
(or is attributable to the period of time during which the Lease is in existence
or prior to the return of Equipment in accordance with the provisions of the
Lease) which the Lessee is or will be obligated to pay or reimburse, pursuant to
this Section 7.1, such liability shall continue, notwithstanding the expiration
or termination of the Lease, until all such Taxes are paid or reimbursed by the
Lessee.

            (i) Affiliated Group. For purposes of applying this Section 7.1 with
respect to any Tax, the term "Owner Participant" shall include each member of
the affiliated group of corporations with which the Owner Participant (and its
successors and assigns) files consolidated or combined tax returns relating to
such Imposition. The term "Lender" shall include any combined, consolidated or
affiliated group (and any member thereof) of which such Person is or shall
become a member if combined, unitary or consolidated returns are or shall be
filed for such affiliated group for United States federal, state or local tax
purposes.

            (j) [Reserved].

            (k) Income Tax. For purposes of this Section 7.1, the term "Income
Tax" means any Tax based on or measured by or with respect to gross income (in
lieu of net income) or net income (including without limitation, capital gains
taxes, personal holding company taxes, minimum taxes and tax preferences) or
gross receipts (in lieu of net receipts) or net receipts and Taxes that are
capital, net worth, conduct of business, franchise or excess profits taxes and
interest, additions to tax, penalties, or other charges in respect thereof
(provided, however, that Taxes that are, or are in the nature of, sales, use,
rental, excise, ad valorem, stamp, transfer, license, value added, or property
(whether tangible or intangible) taxes shall not constitute an Income Tax).

            (l) Certain Withholding. If the Indenture Trustee or Pass Through
Trustee fails to withhold any Tax required to be withheld with respect to any
payment to a Lender Tax

                                       67

Indemnitee or any claim is otherwise asserted by a taxing authority against the
Equity Tax Indemnitee for or on account of any amount required to be withheld
from any payment to a Lender Tax Indemnitee or Certificateholder, then the
Lessee will indemnify such Equity Tax Indemnitee (without regard to any
exclusions in Section 7.1(c) hereof) on an After-Tax Basis against any Taxes
required to be withheld and any interest, penalties, and additions to tax with
respect thereto, along with other costs (including attorneys' fees) incurred in
connection with such claim. The Indenture Trustee or the Pass Through Trustee,
as the case may be, in its individual capacity (and without recourse to the
Indenture Estate, the Trust Estate or the Lessee) shall indemnify the Lessee on
an After-Tax Basis for any payment the Lessee shall have made pursuant to the
preceding sentence.

            (m) Trust Tax Ownership Structure. The Owner Participant hereby
agrees that by December 31, 2005, it shall take all reasonable actions permitted
under applicable law (including, but not limited to creating new entities) to
restructure and hold its beneficial interest in the Trust through a limited
partnership that is disregarded for federal income tax purposes in order to
minimize Texas franchise taxes, if any, imposed on it or any other Equity Tax
Indemnitee as a result of the transactions contemplated herein and for which any
indemnity for such taxes under this Section 7.1 would be owed. The Owner
Participant further agrees to the extent a change in Texas law eliminates the
ability to reduce Texas franchise taxes through a limited partnership structure,
the Owner Participant shall take such reasonable steps to mitigate the Texas
franchise taxes as the result of the change in law, so long as the Owner
Participant determines in its sole discretion that such steps will not have a
material adverse effect on the Owner Participant or any of its Affiliates. The
Lessee shall reimburse the Owner Participant for (x) the costs of any actions
taken pursuant to, or to accomplish the intention of, this Section 7.1(m),
including any taxes attributable to such actions, and (y) any and all Texas
taxes that relate directly or indirectly to the transactions contemplated by the
Operative Agreements, Pass Through Documents or Partnership Documents, in each
case on an After-Tax Basis and without regard to the exclusions in Section
7.1(c) hereof, provided, however that for the avoidance of doubt,
nothwithstanding any provision herein, the Lessee shall not be required to
indemnify the Owner Participant or any of its Affiliates for any such taxes that
would have been imposed on the Owner Participant or any of its Affiliates
without regard to the transactions contemplated by the Operative Agreements,
Pass Through Documents or Partnership Documents. Notwithstanding any other
provision hereto or under any other Operative Agreement, the other parties to
this Agreement hereby agree and consent to the Owner Participant taking the
actions specified in the first and second sentences of this Section 7.1(m).

      Section 7.2 General Indemnification.

            (a) Claims Defined. For the purposes of Sections 7.2 and 7.3,
"Claims" shall mean any and all costs, expenses, liabilities, obligations,
losses, damages, penalties, actions or suits or claims of whatsoever kind or
nature (whether or not on the basis of negligence, strict or absolute liability
or liability in tort) (including, without limitation, Claims and Taxes arising
out of, or in connection with ERISA, Section 4975 of the Code or provisions
under any federal, state or local authority or any foreign governmental
authority (or political subdivision thereof) that contains one or more
provisions that are similar to Section 406 of ERISA or Section 4975 of the Code
("Similar Laws")) that may be imposed on, incurred by, suffered by, or asserted
against an Indemnified Person, any Unit or any Pledged Unit or other Collateral
and, except as otherwise

                                       68

expressly provided in Section 7.2 and 7.3, shall include, but not be limited to,
all reasonable out-of-pocket costs, disbursements and expenses (including legal
fees and expenses) paid or incurred by an Indemnified Person in connection
therewith or related thereto.

            (b) Indemnified Person Defined. For the purposes of Sections 7.2 and
7.3, "Indemnified Person" means the Owner Participant, the Owner Trustee, Trust
Company, the Indenture Trustee, both in its individual capacity and as trustee,
the Pass Through Trustee, the Policy Provider, each of the Affiliates and each
of the respective directors, officers, employees, successors and permitted
assigns, agents and servants of the foregoing, the Trust Estate and the
Indenture Estate (the respective directors, officers, employees, successors and
permitted assigns, agents and servants of the Owner Participant, the Owner
Trustee, Trust Company, the Indenture Trustee, the Pass Through Trustee, the
Policy Provider and each of their Affiliates, as applicable, together with the
Owner Participant, the Owner Trustee, Trust Company, the Indenture Trustee, the
Pass Through Trustee and each of their Affiliates, as the case may be, being
referred to herein collectively as the "Related Indemnitee Group" of the Owner
Participant, the Indenture Trustee, the Owner Trustee, the Pass Through Trustee
and the Trust Company, respectively).

            (c) Claims Indemnified. Whether or not any Unit is accepted under
the Lease, or the Closing occurs, and subject to the exclusions stated in
Section 7.2(d) below, Lessee agrees to indemnify, protect, defend and hold
harmless each Indemnified Person on an After-Tax Basis against Claims directly
or indirectly resulting from or arising out of or alleged to result from or
arise out of (whether or not such Indemnified Person shall be indemnified as to
such Claim by any other Person but subject to Section 7.2(g)):

                  (i) this Agreement or any other Operative Agreement or any
Partnership Document or any of the transactions contemplated hereby or thereby
or any Unit or Pledged Unit or other Collateral or the acquisition, ownership,
lease, operation, possession, modification, improvement, abandonment, use,
non-use, maintenance, lease, sublease, substitution, control, repair, storage,
alteration, transfer or other application or disposition, return, overhaul,
testing, servicing, replacement or registration of any Unit or Pledged Unit
(including, without limitation, injury, death or property damage of passengers,
shippers or others, environmental control, noise and pollution regulations, or
the presence, discharge, treatment, storage, handling, generation, disposal,
spillage, release, escape of or exposure of any Person or thing to (directly or
indirectly) Hazardous Substances or damage to the environment (including,
without limitation, costs of investigations or assessments, clean-up costs,
response costs, remediation costs, removal costs, restoration costs, monitoring
costs, costs of corrective actions and natural resource damages)) whether or not
in compliance with the terms of the Lease or the Collateral Agency Agreement, as
applicable, or any of the commodities, items or materials from time to time
contained in any Unit or Pledged Unit, whether or not in compliance with the
terms of the Lease or the Collateral Agency Agreement, as applicable, or the
inadequacy of any Unit or Pledged Unit or deficiency or defect in any Unit or
Pledged Unit or any other circumstances in connection with any Unit or Pledged
Unit or the performance of any Unit or Pledged Unit or any risks relating
thereto;

                  (ii) the construction, manufacture, financing, refinancing,
design, purchase, acceptance, rejection, delivery, non-delivery or condition of
any Unit or any Pledged

                                       69

Unit (including, without limitation, latent and other defects, whether or not
discoverable, and any claim for patent, trademark or copyright infringement);

                  (iii) any act or omission (whether negligent or otherwise) or
any breach of or failure to perform or observe, or any other non-compliance
with, any covenant, condition or agreement to be performed by, or other
obligation of, the Lessee or any Affiliate of the Lessee under any of the
Operative Agreements or Partnership Documents, or the falsity of any
representation, warranty or certification of the Lessee or any Affiliate of the
Lessee in any of the Operative Agreements or Partnership Documents to which it
is a party or in any document or certificate delivered by the Lessee or any
Affiliate of the Lessee in connection therewith other than representations and
warranties in the Tax Indemnity Agreement;

                  (iv) the offer, sale or delivery of any Equipment Notes or
Pass Through Certificates or any interest in the Trust Estate or in connection
with a refinancing in accordance with the terms hereof; and

                  (v) any violation of any law, rule, regulation or order by the
Lessee or any Affiliate of Lessee or any Sublessee or any Pledged Equipment
Lessee or any of their respective directors, officers, employees, agents or
servants.

            (d) Claims Excluded. The following are excluded from the Lessee's
agreement to indemnify under this Section 7.2:

                  (i) Claims with respect to any Unit to the extent attributable
to acts or events occurring after (and not attributable to events that have
occurred or conditions existing prior to) (A) in the case of the consummation by
the Lessee of a purchase option under Section 22.1 or 22.3 of the Lease or the
occurrence of an Event of Loss with respect to such Unit under Section 11 of the
Lease, the later to occur of (x) the payment of all amounts due from the Lessee
in connection with any such event and (y) the release of the Lien of the
Indenture on such Unit or (B) in all other cases, the last to occur of (x) with
respect to such Unit, the earlier to occur of the termination of the Lease or
the expiration of the Lease Term, (y) with respect to each Unit, the return of
such Unit to the Lessor in accordance with the terms of the Lease (it being
understood that, so long as any Unit is in storage as provided in Section 6.1 of
the Lease, the date of return thereof for the purpose of this clause (i) shall
be the last day of the Storage Period) and (z) the release of the Lien of the
Indenture on such Unit;

                  (ii) Claims which are Taxes or any loss of tax benefits or
increases in tax liability (provided that this clause (ii) shall not preclude a
Claim from being paid on an After-Tax Basis), but not excluding Taxes or any
loss of tax benefits or increases in tax liability with respect to any
Indemnified Person, or any other person who, together with such Indemnified
Person, is treated as one employer for employee benefit plan purposes, as a
result of, or in connection with, any "prohibited transaction" within the
meaning of the provisions of the Code or regulations thereunder or as set forth
in Section 406 of ERISA or the regulations implementing ERISA, Section 4975 of
the Code or the regulations thereunder or applicable Similar Laws or the
regulations thereunder;

                                       70

(iii) with respect to any particular Indemnified Person,
Claims resulting from the gross negligence or willful misconduct of such
Indemnified Person or a Related Party of such Indemnified Person (other than
gross negligence or willful misconduct imputed as a matter of law to such
Indemnified Person solely by reason of its interest in the Equipment), or any
breach of any covenant, or falsity of any representation or warranty of such
Indemnified Person or such Related Party;

                  (iv) Claims to the extent attributable to any transfer by the
Lessor of the Equipment or any portion thereof or any transfer by the Owner
Participant of all or any portion of its interest in the Trust Estate other than
(x) any such transfer in connection with a Lease Event of Default or the
exercise of remedies in connection therewith and (y) any such transfer to the
Lessee or its designee in connection with a purchase or a voluntary termination
as contemplated by the Lease or Section 6.9 or (z) any such transfer made
pursuant to Section 7.1(m);

                  (v) with respect to any particular Indemnified Person that is
the Owner Participant or the Owner Trustee in the case of clause (a) below or
that is the Loan Participant in the case of clause (b) below, unless such
transfer is required by the terms of the Operative Agreements or occurs during
the continuance of a Lease Event of Default, Claims relating to any offer, sale,
assignment, transfer or other disposition (voluntary or involuntary) (a) in the
case of the Owner Participant, of any of its interest in the Beneficial Interest
(other than pursuant to Section 6.9 or Section 7.1(m)) or (b) with respect to
the Loan Participant, of all or any portion of the Loan Participant's interest
in the Equipment Notes or the collateral therefor;

                  (vi) with respect to any particular Indemnified Person, Claims
resulting from the imposition of any Lessor's Lien (or other liens not expressly
permitted) attributable to such Indemnified Person or a Related Party of such
Indemnified Person;

                  (vii) with respect to any particular Indemnified Person,
Claims to the extent the risk thereof has been expressly assumed by such
Indemnified Person in connection with the exercise by such Indemnified Person of
any inspection rights under the Operative Documents;

                  (viii) Claims relating to any amount that constitutes or (in
the case of subclause (D)) is attributable to: (A) principal of, or interest or
premium on the Equipment Notes or securities issued by the Pass Through Trusts
(except to the extent such amounts are otherwise indemnified pursuant to Section
7.2(c)(iv)); (B) Transaction Costs (without limiting Lessee's obligations under
Sections 2.5(c) and 2.5(e)); (C) ordinary and usual operating or overhead
expenses of the applicable Indemnified Person; (D) Indenture Events of Default
not attributable to a Lease Event of Default or a Manager Default; and (E)
failure by Owner Trustee, Indenture Trustee or Pass Through Trustee,
respectively, to distribute any amounts held by it in accordance with the
Operative Agreements; and

                  (ix) Claims relating to the authorization or giving or
withholding of any future amendments, supplements, waivers or consents with
respect to any of the Operative Agreements which are not (1) requested by the
Lessee or (2) required by any applicable law or regulation (other than laws or
regulations solely relating to the business of the Lessor, the

                                       71

Indenture Trustee, the Trust Company, the Pass Through Trustee, the Initial
Purchasers, the Collateral Agent, the Policy Provider or any Participant) or (3)
entered into in connection with, or as a result of, a Lease Default or (4)
required pursuant to the terms of the Operative Agreements (including such
reasonable expenses incurred in connection with any adjustment pursuant to
Section 2.6).

            (e) Insured Claims. In the case of any Claim indemnified by the
Lessee hereunder which is covered by a policy of insurance maintained by the
Lessee pursuant to Section 12 of the Lease or otherwise, each Indemnified Person
agrees to provide reasonable cooperation to the applicable insurers in the
exercise of their rights to investigate, defend, settle or compromise such Claim
as may be required to retain the benefits of such insurance with respect to such
Claim.

            (f) Claims Procedure. An Indemnified Person shall, after obtaining
knowledge thereof, promptly notify the Lessee of any Claim as to which
indemnification is sought; provided, however, that the failure to give such
notice shall not release the Lessee from any of its obligations under this
Section 7.2, except (but only if neither the Lessee nor TILC shall have actual
knowledge of such Claim) to the extent that failure to give notice of any
action, suit or proceeding against such Indemnified Person shall have a material
adverse effect on Lessee's ability to defend such Claim or recover proceeds
under any insurance policies maintained by the Lessee or to the extent Lessee's
indemnification obligations are increased as a demonstrable result of such
failure. The Lessee shall, after obtaining knowledge thereof, promptly notify
each Indemnified Person of any indemnified Claim affecting such Indemnified
Person. Subject to the provisions of the following paragraph, the Lessee shall
at its sole cost and expense be entitled to control, and shall assume full
responsibility for, the defense of such claim or liability; provided that the
Lessee shall confirm to such Indemnified Person Lessee's obligations to
indemnify hereunder for such Claim, shall keep the Indemnified Person which is
the subject of such proceeding fully apprised of the status of such proceeding
and shall provide such Indemnified Person with all information with respect to
such proceeding as such Indemnified Person shall reasonably request. To the
extent that a Claim is made against Lessee pursuant to this Section 7.2 at a
time when an identical claim for indemnification arising from substantially
similar facts and circumstances is being asserted against TILC or TRLTII
pursuant to this Section 7, if Lessee is entitled to control the defense of such
Claim pursuant to this Section 7.2 and at the same time TILC or TRLTII, as the
case may be, is entitled to control the defense of such claim or liability
pursuant to this Section 7, Lessee's indemnification obligations under this
Section 7.2 shall not be reduced as a result of the inability of Lessee to
control the defense of such Claim where such inability to control the defense of
such Claim is caused by the exercise by TILC or TRLTII, as applicable, of such
Person's right to control the defense of such indemnified claim as provided by
this Section 7.

            Notwithstanding any of the foregoing to the contrary, the Lessee
shall not be entitled to control and assume responsibility for the defense of
any Claim if (1) a Lease Default shall have occurred and be continuing, (2) such
proceeding will involve any material danger of the sale, forfeiture or loss of,
or the creation of any Lien (other than any Lien permitted under the Operative
Agreements or a Lien that is adequately bonded to the satisfaction of such
Indemnified Person) on, any Unit, Pledged Unit, Sublease, Pledged Equipment
Lease or Applicable Sublease Payment or Applicable Railcar Payment (each as
defined in the Management Agreement), (3) in

                                       72

the good faith opinion of such Indemnified Person, there exists an actual or
potential conflict of interest such that it is advisable for such Indemnified
Person to retain control of such proceeding, (4) such Claim involves the
possibility of criminal sanctions or liability to such Indemnified Person, (5)
an Equity Insufficiency Circumstance shall exist or (6) such proceeding involves
Claims not fully indemnified by the Lessee. In the circumstances described in
clauses (1) - (6), the Indemnified Person shall be entitled to control and
assume responsibility for the defense of such claim or liability at the expense
of the Lessee. In addition, any Indemnified Person may participate in any
reasonable manner that is not likely to materially interfere with such control
in any proceeding controlled by the Lessee pursuant to this Section 7.2, at its
own expense, in respect of any such proceeding as to which the Lessee shall have
acknowledged in writing its obligation to indemnify the Indemnified Person
pursuant to this Section 7.2, and at the expense of the Lessee in respect of any
such proceeding as to which the Lessee shall not have so acknowledged its
obligation to the Indemnified Person pursuant to this Section 7.2. The Lessee
may in any event participate in all such proceedings at its own cost; provided
that if Lessee is not entitled to control the defense of such Claim in
accordance with this Section 7.2(f), any participation of the Lessee in such
proceeding shall be in a reasonable manner that is not likely to materially
interfere with the control of the Indemnified Person in such proceeding. Nothing
contained in this Section 7.2(f) shall be deemed to require an Indemnified
Person to contest any Claim or to assume responsibility for or control of any
judicial proceeding with respect thereto. No Indemnified Person shall enter into
any settlement or other compromise with respect to any Claim without the prior
written consent of the Lessee unless the Indemnified Person waives its rights to
indemnification hereunder; provided that an Indemnified Person shall be
permitted to enter into such a settlement or compromise without the consent of
the Lessee and without waiving its indemnification rights hereunder if (x) such
Indemnified Person has given the Lessee reasonable prior notice of its intention
to settle or compromise such Claim (the reasonableness of its prior notice to
take into account, among other items, any applicable deadlines in any
proceedings relating to such Claim), (y) the Lessee has not acknowledged its
indemnity obligations with respect to such Claim and (z) there is a significant
risk that an adverse judgment will be entered into against such Indemnified
Person with respect to such Claim.

            In the event that in the course of the investigation or defense of a
Claim, the Lessee shall in good faith reasonably determine that it is not liable
for indemnification with respect thereto under this Section 7.2, it may give
notice to the applicable Indemnified Person of such fact; and, in such case, any
acknowledgment theretofore made by the Lessee of liability with respect to such
Claim under this Section 7.2 shall be deemed revoked and the Lessee may
thereupon cease to defend such Claim; provided that (i) the Lessee shall have
given the Indemnified Person reasonable prior notice of its intention to
renounce such acknowledgment, (ii) the Lessee's conduct regarding the defense of
such Claim or any decision to withdraw from such defense shall not prejudice or
have prejudiced the Indemnified Person's ability to contest such Claim (taking
into account, among other things, the timing of the Lessee's withdrawal and the
theory or theories upon which Lessee shall have based its defense), and (iii)
the Lessee shall have given such Indemnified Person all materials, documents and
records relating to its defense of such Claim as such Indemnified Person shall
have reasonably requested in connection with the assumption by such Indemnified
Person of the defense of such Claim at the cost and expense of the Lessee. In
the event that the Lessee shall cease to defend any Claim pursuant to the
preceding sentence, the Lessee shall indemnify each Indemnified Person, without
regard to any exclusion that might otherwise apply hereunder, to the extent that
the actions of the Lessee in defending

                                       73

such Claim or the manner or time of the Lessee's election to withdraw from the
defense of such Claim shall have caused such Indemnified Person to incur any
loss, cost, liability, expense or other Claim that such Indemnified Person would
not have incurred had the Lessee not ceased to defend such Claim in such manner
or such time.

            (g) Subrogation. If a Claim indemnified by the Lessee under this
Section 7.2 is paid in full by the Lessee and/or an insurer under a policy of
insurance maintained by the Lessee, the Lessee and/or such insurer, as the case
may be, shall be subrogated to the extent of such payment to the rights and
remedies of the Indemnified Person (other than under insurance policies
maintained by such Indemnified Person) on whose behalf such Claim was paid with
respect to the transaction or event giving rise to such Claim. Should an
Indemnified Person receive any refund, in whole or in part, with respect to any
Claim paid by the Lessee hereunder, it shall promptly pay over the amount
refunded (but not in excess of the amount the Lessee or any of its insurers has
paid) to the Lessee; provided, however, so long as a Lease Event of Default
shall have occurred and be continuing, such amount may be held by the Collateral
Agent as security for the Lessee's obligations under the Lease and the other
Operative Agreements; provided, further, only with respect to the Owner
Participant and its Related Indemnitee Group, so long as an event referred to in
clause (5) of Section 7.2(f) hereof shall have occurred and be continuing, such
amount may be held by the Owner Trustee as security for the Lessee's obligations
with respect to the Equity Insufficiency Circumstance.

      Section 7.3 Indemnification by TILC.

            (a) Claims Indemnified. Whether or not any Unit is accepted under
the Lease, or the Closing occurs, and subject to the exclusions stated in
Section 7.3(b) below, TILC agrees to indemnify, protect, defend and hold
harmless each Indemnified Person on an After-Tax Basis against Claims directly
or indirectly resulting from or arising out of or alleged to result from or
arise out of (whether or not such Indemnified Person shall be indemnified as to
such Claim by any other Person but subject to Section 7.3(d)):

                  (i) any breach of or any inaccuracy in any representation,
warranty or certification made by TILC in this Agreement or any of the other
Operative Agreements or in any document or certificate delivered by TILC
pursuant hereto or thereto;

                  (ii) any breach of or failure by TILC to perform any covenant
or obligation of TILC set out in or contemplated by this Agreement or any of the
other Operative Agreements; and

                  (iii) any violation of any law, rule, regulation or order by
TILC or its directors, officers, employees, agents or servants.

            (b) Claims Excluded. The following are excluded from TILC's
agreement to indemnify under this Section 7.3:

                  (i) Claims attributable to acts or events occurring after the
termination of the Lease or the expiration of the Lease Term; and

                                       74

(ii) Claims which are Taxes or any loss of tax benefits or
increases in tax liability (provided that this clause (ii) shall not preclude a
Claim from being paid on an After-Tax Basis);

            (c) Claims Procedure. An Indemnified Person shall, after obtaining
knowledge thereof, promptly notify TILC of any Claim as to which indemnification
is sought; provided, however, that the failure to give such notice shall not
release TILC from any of its obligations under this Section 7.3, except (but
only if neither the Lessee nor TILC shall have actual knowledge of such Claim)
to the extent that failure to give notice of any action, suit or proceeding
against such Indemnified Person shall have a material adverse effect on TILC's
ability to defend such Claim or recover proceeds under any insurance policies
maintained by TILC or to the extent TILC's indemnification obligations are
increased as a demonstrable result of such failure. TILC shall, after obtaining
knowledge thereof, promptly notify each Indemnified Person of any indemnified
Claim affecting such Indemnified Person. Subject to the provisions of the
following paragraph, TILC shall at its sole cost and expense be entitled to
control, and shall assume full responsibility for, the defense of such claim or
liability; provided that TILC shall confirm to such Indemnified Person TILC's
obligations to indemnify hereunder for such Claim, shall keep the Indemnified
Person which is the subject of such proceeding fully apprised of the status of
such proceeding and shall provide such Indemnified Person with all information
with respect to such proceeding as such Indemnified Person shall reasonably
request. To the extent that a Claim is made against TILC pursuant to this
Section 7.3 at a time when an identical claim for indemnification arising from
substantially similar facts and circumstances is being asserted against Lessee
or TRLTII pursuant to this Section 7, if TILC is entitled to control the defense
of such Claim pursuant to this Section 7.3 and at the same time Lessee or
TRLTII, as the case may be, is entitled to control the defense of such claim or
liability pursuant to this Section 7, TILC's indemnification obligations under
this Section 7.3 shall not be reduced as a result of the inability of TILC to
control the defense of such Claim where such inability to control the defense of
such Claim is caused by the exercise by Lessee or TRLTII, as applicable, of such
Person's right to control the defense of such indemnified claim as provided by
this Section 7.

            Notwithstanding any of the foregoing to the contrary, TILC shall not
be entitled to control and assume responsibility for the defense of any Claim if
(1) a Lease Event of Default shall have occurred and be continuing, (2) such
proceeding will involve any material danger of the sale, forfeiture or loss of,
or the creation of any Lien (other than any Lien permitted under the Operative
Agreements or a Lien which is adequately bonded to the satisfaction of such
Indemnified Person) on, any Unit or Pledged Unit, (3) in the good faith opinion
of such Indemnified Person, there exists an actual or potential conflict of
interest such that it is advisable for such Indemnified Person to retain control
of such proceeding, (4) such Claim involves the possibility of criminal
sanctions or liability to such Indemnified Person or (5) an Equity Insufficiency
Circumstance shall exist. In the circumstances described in clauses (1) - (5),
the Indemnified Person shall be entitled to control and assume responsibility
for the defense of such claim or liability at the expense of TILC. In addition,
any Indemnified Person may participate in any reasonable manner that is not
likely to materially interfere with such control in any proceeding controlled by
TILC pursuant to this Section 7.3, at its own expense, in respect of any such
proceeding as to which TILC shall have acknowledged in writing its obligation to
indemnify the Indemnified Person pursuant to this Section 7.3, and at the
expense of TILC in respect of any such proceeding as to which TILC shall not
have so acknowledged its obligation

                                       75

to the Indemnified Person pursuant to this Section 7.3. TILC may in any event
participate in all such proceedings at its own cost; provided that if TILC is
not entitled to control the defense of such Claim in accordance with this
Section 7.3(c), any participation of the TILC in such proceeding shall be in a
reasonable manner that is not likely to materially interfere with the control of
the Indemnified Person in such proceeding. Nothing contained in this Section
7.3(c) shall be deemed to require an Indemnified Person to contest any Claim or
to assume responsibility for or control of any judicial proceeding with respect
thereto. No Indemnified Person shall enter into any settlement or other
compromise with respect to any Claim without the prior written consent of TILC
unless the Indemnified Person waives its rights to indemnification hereunder;
provided that an Indemnified Person shall be permitted to enter into such a
settlement or compromise without the consent of TILC and without waiving its
indemnification rights hereunder if (x) such Indemnified Person has given TILC
reasonable prior notice of its intention to settle or compromise such Claim (the
reasonableness of its prior notice to take into account, among other items, any
applicable deadlines in any proceedings relating to such Claim), (y) TILC has
not acknowledged its indemnity obligations with respect to such Claim and (z)
there is a significant risk that an adverse judgment will be entered into
against such Indemnified Person with respect to such Claim.

            In the event that in the course of the investigation or defense of a
Claim, TILC shall in good faith reasonably determine that it is not liable for
indemnification with respect thereto under this Section 7.2, it may give notice
to the applicable Indemnified Person of such fact; and, in such case, any
acknowledgment theretofore made by TILC of liability with respect to such Claim
under this Section 7.2 shall be deemed revoked and TILC may thereupon cease to
defend such Claim; provided that (i) TILC shall have given the Indemnified
Person reasonable prior notice of its intention to renounce such acknowledgment,
(ii) TILC's conduct regarding the defense of such Claim or any decision to
withdraw from such defense shall not prejudice or have prejudiced the
Indemnified Person's ability to contest such Claim (taking into account, among
other things, the timing of TILC's withdrawal and the theory or theories upon
which TILC shall have based its defense), and (iii) TILC shall have given such
Indemnified Person all materials, documents and records relating to its defense
of such Claim as such Indemnified Person shall have reasonably requested in
connection with the assumption by such Indemnified Person of the defense of such
Claim at the cost and expense of TILC. In the event that TILC shall cease to
defend any Claim pursuant to the preceding sentence, TILC shall indemnify each
Indemnified Person, without regard to any exclusion that might otherwise apply
hereunder, to the extent that the actions of TILC in defending such Claim or the
manner or time of TILC's election to withdraw from the defense of such Claim
shall have caused such Indemnified Person to incur any loss, cost, liability,
expense or other Claim that such Indemnified Person would not have incurred had
TILC not ceased to defend such Claim in such manner or such time.

            (d) Subrogation. If a Claim indemnified by TILC under this Section
7.3 is paid in full by TILC and/or an insurer under a policy of insurance
maintained by TILC, TILC and/or such insurer, as the case may be, shall be
subrogated to the extent of such payment to the rights and remedies of the
Indemnified Person (other than under insurance policies maintained by such
Indemnified Person) on whose behalf such Claim was paid with respect to the
transaction or event giving rise to such Claim. Should an Indemnified Person
receive any refund, in whole or in part, with respect to any Claim paid by TILC
hereunder, it shall promptly pay over the amount refunded (but not in excess of
the amount TILC or any of its insurers has

                                       76

paid) to TILC; provided, however, so long as a Lease Event of Default shall have
occurred and be continuing, such amount may be held by the Collateral Agent assecurity for TILC's obligations under the Lease and the other Operative
Agreements; provided, further, only with respect to the Owner Participant and
its Related Indemnitee Group, so long as an event referred to in clause (5) of
Section 7.3(c) hereof shall have occurred and be continuing, such amount may be
held by the Owner Trustee as security for the Lessee's obligations with respect
to the Equity Insufficiency Circumstance.

      Section 7.4 Special Indemnification Regarding Exercise of Setoff by
Customers. TILC hereby agrees, for the benefit of the Owner Participant, the
Policy Provider, the holders of the Equipment Notes, the Trust Estate and the
Indenture Estate, that it will, within 45 days after the date on which it has
knowledge that any Customer shall have reduced any payments made by such
Customer under any Sublease or Pledged Equipment Lease as a result of or in
connection with any setoff exercised by such Customer (regardless of whether
such Customer actually has any contractual, statutory or other right to exercise
such setoff) with respect to amounts owed or presumed owed to such Customer
pursuant to railcar subleases or leases not constituting Subleases or Pledged
Equipment Leases, and provided that the applicable Customer shall not have made
payments aggregating the full amount payable by such Customer under the
applicable Sublease or Pledged Equipment Lease prior to the end of such 30-day
period, deposit into the Collection Account an amount, in immediately available
funds, equal to the amount of such reduction.

SECTION 8. LESSEE'S RIGHT OF QUIET ENJOYMENT.

      Each party to this Agreement acknowledges notice of, and consents in all
respects to, the terms of the Lease, and expressly, severally and as to its own
actions only, agrees that it shall not take or cause to be taken any action
contrary to the Lessee's rights under the Lease, including, without limitation,
the right to possession, use and quiet enjoyment (i) by the Lessee of the
Equipment, so long as no Lease Event of Default has occurred and is continuing,
or (ii) to the extent required under the applicable Sublease or Pledged
Equipment Lease or under any applicable consent referred to in Section 4.1(cc)
by any Sublessee of the Equipment or by any Pledged Equipment Lessee of the
Pledged Equipment.

SECTION 9. SUCCESSOR INDENTURE TRUSTEE.

      In the event that the Indenture Trustee gives notice of its resignation
pursuant to Section 8.2 of the Indenture, the Owner Trustee shall promptly
appoint a successor Indenture Trustee reasonably acceptable to the Lessee.

SECTION 10. MISCELLANEOUS.

      Section 10.1 Consents. Each Participant covenants and agrees (subject, in
the case of the Loan Participant, to all of the terms and provisions of the
Indenture) that it shall not unreasonably withhold its consent to any consent
requested by the Lessee, TILC, TRLTII, the Owner Trustee, the Pass Through
Trustee or the Indenture Trustee, as the case may be, under the

                                       77

terms of the Operative Agreements that by its terms is not to be unreasonably
withheld by the Owner Trustee or the Indenture Trustee.

      Section 10.2 Refinancing. So long as no Lease Event of Default has
occurred and is continuing, the Lessee shall have the right, on no more than two
occasions, in its sole discretion, at any time following the fifth anniversary
of the Closing Date, to request the Owner Participant and the Trust to effect an
optional prepayment of all, but not less than all, of the Equipment Notes
pursuant to Section 2.10(d) of the Indenture as part of a refunding or
refinancing operation, provided that the Lessee shall obtain the prior written
consent of the Owner Participant to be granted in the sole discretion of the
Owner Participant acting in good faith if such refinancing imposes any increased
risk or liability on or otherwise adversely affects the Owner Participant;
provided further, that the Owner Participant shall not withhold such consent if
in its sole judgment (i) any increased risk or liability is both remote and not
material, (ii) the Lessee and Trinity are at the time at least as creditworthy
as on the Closing Date and (iii) the Lessee provides an indemnity, in form and
substance satisfactory to the Owner Participant, for such increased risk or
liability, which indemnity is guaranteed by Trinity pursuant to a Guaranty
substantially in the form of Section 11 of this Agreement. As soon as
practicable after receipt of such request, the Owner Participant and the Lessee
shall cooperate in good faith to effectuate such refinancing or refunding and
shall enter into an agreement, in form and substance satisfactory to the parties
thereto, as to the terms of such refunding or refinancing as follows:

            (a) the Lessee, the Owner Participant, the Indenture Trustee, the
Owner Trustee, and any other appropriate parties will enter into a financing or
loan agreement (which may involve an underwriting agreement in connection with a
public offering or a securities purchase agreement in connection with a Rule
144A offering), in form and substance reasonably satisfactory to the parties
thereto, providing for (i) the issuance and sale by the Trust or such other
party as may be appropriate on the date specified in such agreement (for the
purposes of this Section 10.2, the "Refunding Date") of debt securities in an
aggregate principal amount (in the lawful currency of the United States) equal
to the principal amount of the Equipment Notes outstanding on the Refunding
Date, having the same maturity date as said Equipment Notes and having a
weighted average life which is not less than or greater than (in either case, by
more than six months) the Remaining Weighted Average Life of said Equipment
Notes, (ii) the application of the proceeds of the sale of such debt securities
to the prepayment of all such Equipment Notes on the Refunding Date, and (iii)
payment by Lessee to the Person or Persons entitled thereto of all other
amounts, in respect of accrued interest, any Make Whole Amount or other premium,
if any, payable on such Refunding Date;

            (b) the Lessee and the Trust will amend the Lease in a manner such
that (i) if the Refunding Date is not a Rent Payment Date and the accrued and
unpaid interest on the Equipment Notes is not otherwise paid pursuant to Section
10.2(a), the Lessee shall on the Refunding Date prepay that portion of the next
succeeding installment of Basic Rent as shall equal the aggregate interest
accrued on the Equipment Notes outstanding to the Refunding Date, (ii) Basic
Rent payable in respect of the period from and after the Refunding Date shall be
recalculated to preserve the Net Economic Return which the Owner Participant
would have realized had such refunding not occurred, provided that the net
present value of Basic Rent shall be minimized to the extent consistent
therewith, and (iii) amounts payable in respect of Stipulated Loss Value,
Stipulated Loss Amount, Early Purchase Price, Termination Value and

                                       78

Termination Amount from and after the Refunding Date shall be appropriately
recalculated to preserve the Net Economic Return which the Owner Participant
would have realized had such refunding not occurred (it being agreed that any
recalculations pursuant to subclauses (ii) and (iii) of this clause (b) shall be
performed in accordance with the requirements of Section 2.6 hereof);

            (c) the Trust will enter into an agreement to provide for the
securing thereunder of the debt securities issued by the Trust pursuant to
clause (a) of this Section 10.2 in like manner as the Equipment Notes and/or
will enter into such amendments and supplements to the Indenture as may be
necessary to effect such refunding or refinancing; provided that, no such
agreement or amendment shall provide for any increase in the security for the
new debt securities; and provided further that, notwithstanding the foregoing
(but subject to the provisions of clauses (a) and (b) and the lead in paragraph
of this Section 10.2 above), the Lessee reserves the right to set the economic
terms and other terms not customarily negotiated between an owner participant
and a lender of the refunding or refinancing transaction to be so offered except
to the extent adversely affecting cash flow, coverage ratios and reserve
accounts, to the extent that they are passed through to the Lessee in, or define
rights or obligations of the Lessee under, the Operative Agreements;

            (d) (i) in the case of a refunding or refinancing involving a public
offering of debt securities, neither the Trust nor the Owner Participant shall
be an "issuer" for securities law purposes or an "obligor" within the meaning of
the Trust Indenture Act of 1939, as amended, the offering materials (including
any registration statement) for the refunding or refinancing transaction shall
be reasonably satisfactory to the Owner Participant and (ii) the Lessee shall
provide satisfactory indemnity to the Owner Trustee and Owner Participant with
respect to the refunding or refinancing;

            (e) unless otherwise agreed by each of the Owner Participant and the
Policy Provider, the Lessee shall pay to the Trust as Supplemental Rent an
amount, on an After-Tax Basis, equal to any Make-Whole Amount, Late Payment
Premium, if any, payable in respect of Equipment Notes outstanding on the
Refunding Date pursuant to the Indenture, all interest which is accrued and
unpaid in respect of late payments of Basic Rent or any part thereof, all Policy
Provider Amounts due and owing to the Policy Provider on the Refunding Date
(after giving effect to the transactions contemplated to occur on the Refunding
Date) and all reasonable fees, costs, expenses of such refunding or refinancing
and of the parties hereto incurred in connection with such refunding or
refinancing (including all reasonable out-of-pocket legal fees and expenses and
the reasonable fees of any financial advisors);

            (f) the Lessee shall give the Indenture Trustee, the Policy
Provider, the Pass Through Trustee and the Owner Participant not less than 25
days prior written notice of the Refunding Date;

            (g) the Owner Participant, the Owner Trustee, the Pass Through
Trustee and the Indenture Trustee shall have received (i) such opinions of
counsel as they may reasonably request concerning compliance with the Securities
Act of 1933, as amended, and any other applicable law relating to the sale of
securities and (ii) such other opinions of counsel and such certificates and
other documents, each in form and substance reasonably satisfactory to them, as

                                       79

they may reasonably request in connection with compliance with the terms and
conditions of this Section 10.2 (including with respect to the Owner Participant
a satisfactory tax opinion to the effect that there are no material adverse tax
consequences as a result of the refinancing); and

            (h) such refinancing shall not violate any requirement of law, and
all necessary authorizations, approvals and consents shall have been obtained
and shall be in full force and effect.

            The Lessee shall pay to or reimburse the Participants, the Owner
Trustee and the Indenture Trustee for (A) all costs and expenses (including
reasonable attorneys' and accountants' fees) paid or incurred by them in
connection with such refunding or refinancing and (B) a refunding fee payable to
each Owner Participant on a pro rata basis upon the occurrence of the second
refunding or refinancing equal to the product of $1,000 multiplied by a
fraction, the numerator of which is the total Equipment Cost of the Units on the
date of such refinancing and the denominator of which is $1,000,000.

      Section 10.3 Amendments and Waivers. No term, covenant, agreement or
condition of this Agreement may be terminated, amended or compliance therewith
waived (either generally or in a particular instance, retroactively or
prospectively) except by an instrument or instruments in writing executed by the
Lessee, TILC, TRLTII, Trinity, the Policy Provider (so long as it is the Control
Party) and each party against which enforcement of the termination, amendment or
waiver is sought.

      Section 10.4 Notices. Unless otherwise expressly specified or permitted by
the terms hereof all communications and notices provided for herein shall be in
writing or by facsimile, and any such notice shall become effective (i) upon
personal delivery thereof, including, without limitation, by reputable overnight
courier, or (ii) in the case of notice by facsimile, upon confirmation of
receipt thereof, provided such transmission is promptly further confirmed by any
of the methods set forth in clause (i) above, in each case addressed to each
party hereto at its address set forth below or, in the case of any such party
hereto, at such other address as such party may from time to time designate by
written notice to the other parties hereto:

            If to the Lessee:

                  Trinity Rail Leasing IV L.P.
                  2525 Stemmons Freeway
                  Dallas, TX 75207
                  Attention: Vice President Leasing Operations
                  Re: (TRLIV 2004-1A)
                  Fax No.: (214) 589-8271
                  Confirmation No: (214) 631-4420

            If to TILC:

                  Trinity Industries Leasing Company
                  2525 Stemmons Freeway
                  Dallas, TX 75207
                  Attention: Vice President Leasing Operations

                                       80

Re: (TRLIV 2004-1A)
                  Fax No.: (214) 589-8271
                  Confirmation No.: (214) 631-4420

            If to the Owner Trustee:

                  U.S. Bank Trust National Association
                  225 Asylum Street, 23rd Floor
                  Hartford, CT 06103
                  Attn: Corporate Trust Department
                  Re: Trinity 2004-1A 
                  Facsimile No.: (860) 241-6889 
                  Confirmation No.: (860) 241-6822

            with a copy to:

                  the Owner Participant at the
                  address set forth below

            If to the Owner Participant:

                  The Fifth Third Leasing Company
                  38 Fountain Square Plaza
                  Cincinnati, OH 45263
                  Attention: Sr. Risk Manager
                  Facsimile No.: (513) 534-6706
                  Confirmation No.: (513) 534-6770

            If to the Indenture Trustee:

                  Wilmington Trust Company
                  1100 North Market Street
                  Rodney Square North
                  Wilmington, Delaware 19890-0001
                  Attention: Corporate Trust Administration
                  Facsimile No.: 302-636-4141
                  Confirmation No.: 302-636-6000

            If to the Pass Through Trustee:

                  Wilmington Trust Company
                  1100 North Market Street
                  Rodney Square North
                  Wilmington, Delaware 19890-0001
                  Attention: Corporate Trust Administration
                  Facsimile No.: 302-636-4141
                  Confirmation No.: 302-636-6000

                                       81

If to the Rating Agency:

                  Standard & Poor's Ratings Group
                  55 Water Street, 40th Floor
                  New York, New York 10041
                  Attention: Stephen F. Rooney, Structured Finance Ratings
                  Facsimile No.: 212-438-2646
                  Confirmation No.: 212-438-2591

                  Moody's Investors Service, Inc.
                  99 Church Street - 4th Floor
                  New York, New York 10007
                  Attention: ABS Monitoring Department
                  Facsimile No.: 212-553-4119
                  Confirmation No.: 212-298-7075

                  If to the Policy Provider:

                  Ambac Assurance Corporation
                  One State Street Plaza, 15th Floor
                  New York, NY 10004
                  Attention: Structured Finance Department-ABS
                  Re: TRLIV 2004-1
                  Facsimile: (212) 208-3509
                  Conf. No.: (212) 208-3186

      Section 10.5 Survival. All warranties, representations, indemnities and
covenants made by any party hereto, herein or in any certificate or other
instrument delivered by any such party or on the behalf of any such party under
this Agreement, shall be considered to have been relied upon by each other party
hereto and shall survive the consummation of the transactions contemplated
hereby on the Closing Date regardless of any investigation made by any such
party or on behalf of any such party.

      Section 10.6 No Guarantee of Residual Value or Debt. Nothing contained
herein or in the Lease, the Indenture, the Trust Agreement or the Tax Indemnity
Agreement or in any certificate or other statement delivered by the Lessee in
connection with the transactions contemplated hereby shall be deemed to be (i) a
guarantee by the Lessee or TILC to the Owner Trustee, the Owner Participant, the
Indenture Trustee, the Pass Through Trustee or the Loan Participant that the
Equipment will have any residual value or useful life, or (ii) a guarantee by
the Indenture Trustee, the Owner Trustee, the Owner Participant, the Lessee or
TILC (A) of payment of the principal of, premium, if any, or interest on the
Equipment Notes or (B) against losses due to the financial inability to pay of
an obligor with respect to a Sublease or Pledged Equipment Sublease.

      Section 10.7 Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of, and shall be enforceable by, the parties
hereto and their respective

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successors and assigns as permitted by and in accordance with the terms hereof
including each successive holder of the Beneficial Interest permitted under
Section 6.1 hereof and each successive holder of any Equipment Note permitted
under the Indenture issued and delivered pursuant to this Agreement or the
Indenture. The parties hereto agree that the Collateral Agent shall be a third
party beneficiary of this Agreement. Except as expressly provided herein or in
the other Operative Agreements, no party hereto may assign their interests
herein without the consent of the parties hereto.

      Section 10.8 Business Day. Notwithstanding anything herein or in any other
Operative Agreement to the contrary, if the date on which any payment is to be
made pursuant to this Agreement or any other Operative Agreement is not a
Business Day, the payment otherwise payable on such date shall be payable on the
next succeeding Business Day with the same force and effect as if made on such
succeeding Business Day and (provided such payment is made on such succeeding
Business Day) no interest shall accrue on the amount of such payment from and
after such scheduled date to the time of such payment on such next succeeding
Business Day.

      Section 10.9 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES (OTHER THAN SECTION 5-1401 OF THE
NEW YORK GENERAL OBLIGATIONS LAW).

      Section 10.10 Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.

      Section 10.11 Counterparts. This Agreement may be executed in any number
of counterparts, each executed counterpart constituting an original but all
together only one Agreement.

      Section 10.12 Headings and Table of Contents. The headings of the Sections
of this Agreement and the Table of Contents are inserted for purposes of
convenience only and shall not be construed to affect the meaning or
construction of any of the provisions hereof.

      Section 10.13 Limitations of Liability; Extent of Interest.

            (a) Liabilities of Participants. Neither the Indenture Trustee, the
Owner Trustee nor any Participant shall have any obligation or duty to the
Lessee, to TILC, to any other Participant or to others with respect to the
transactions contemplated hereby, except those obligations or duties of such
Participant expressly set forth in this Agreement and the other Operative
Agreements, and neither the Indenture Trustee nor any Participant shall be
liable for performance by any other party hereto of such other party's
obligations or duties hereunder. Without limitation of the generality of the
foregoing, under no circumstances whatsoever shall the Indenture Trustee or any
Participant be liable to the Lessee or TILC for any action or inaction on the
part of the Owner Trustee in connection with the transactions contemplated
herein,

                                       83

whether or not such action or inaction is caused by willful misconduct or gross
negligence of the Owner Trustee, unless such action or inaction is at the
direction of the Indenture Trustee or any Participant, as the case may be, and
such action or inaction is expressly prohibited hereby.

            (b) No Recourse to the Owner Trustee. It is expressly understood and
agreed by and between Trust Company, the Owner Trustee, the Lessee, the Owner
Participant, the Indenture Trustee, the Pass Through Trustee, and the Loan
Participant, and their respective successors and permitted assigns that, subject
to the proviso contained in this Section 10.13(b), all representations,
warranties and undertakings of the Owner Trustee hereunder shall be binding upon
the Owner Trustee only in its capacity as Owner Trustee under the Trust
Agreement, and (except as expressly provided herein) Trust Company shall not be
liable for any breach thereof, except for its gross negligence or willful
misconduct, or for breach of its covenants, representations and warranties
contained herein, except to the extent covenanted or made in its individual
capacity; provided, however, that nothing in this Section 10.13 (b) shall be
construed to limit in scope or substance those representations and warranties of
Trust Company made expressly in its individual capacity set forth herein. The
term "Owner Trustee" as used in this Agreement shall include any successor
trustee under the Trust Agreement, or the Owner Participant if the trust created
thereby is revoked.

            (c) Extent of Interest of Holders of Equipment Notes. No holder of
an Equipment Note shall have any further interest in, or other right with
respect to, the mortgage and security interests created by the Indenture when
and if the principal of and interest on all Equipment Notes held by such holder
and all other sums payable to such holder hereunder, under the Indenture and
under such Equipment Notes shall have been paid in full. Each holder of the
Equipment Notes by its acceptance of an Equipment Note, agrees that it will look
solely to the income and proceeds from the Indenture Estate to the extent
available for distribution to such holder as provided in Article III of the
Indenture and that neither TILC, the Lessee, the Owner Participant, the
Indenture Trustee nor the Owner Trustee shall be personally liable to any holder
of the Equipment Notes for any amounts payable under the Equipment Notes, the
Indenture or hereunder, except as expressly provided in the Operative
Agreements.

            (d) Loan Participant's Source of Funds. It is expressly understood
and agreed by and between the Owner Trustee, the Lessee, the Owner Participant,
the Indenture Trustee, the Pass Through Trustee and the Loan Participant, and
their respective successors and permitted assigns that, subject to the proviso
contained in this Section 10.13(d), the undertakings of the Loan Participant
hereunder are limited to the application of the proceeds of the sale of the Pass
Through Certificates to the purchase by the Pass Through Trustee of the
Equipment Notes; provided, however, that nothing in this Section 10.13(d) shall
be construed to limit in scope or substance those representations and warranties
of the Loan Participant made expressly in its individual capacity set forth
herein.

      Section 10.14 Maintenance of Non-Recourse Debt. The parties hereto agree
that if the Trust becomes a debtor subject to the reorganization provisions of
the Bankruptcy Code, 11 U.S.C. Section 101 et seq. (the "Bankruptcy Code") or
any successor provision, the parties hereto will make an election under
1111(b)(1)(A)(i) of the Bankruptcy Code. If (a) the Trust becomes a debtor
subject to the reorganization provisions of the Bankruptcy Code or any successor
provision, (b) pursuant to such reorganization provisions the Trust is required,
by reason of the

                                       84

Trust being held to have recourse liability to the Pass Through Trustee or the
Indenture Trustee, directly or indirectly, to make payment on account of any
amount payable under the Equipment Notes or any of the other Operative
Agreements and (c) the Indenture Trustee and/or the Pass Through Trustee
actually receives any Excess Amount (as hereinafter defined) which reflects any
payment by the Trust on account of (b) above, then the Indenture Trustee and/or
the Pass Through Trustee, as the case may be, shall promptly refund to the Trust
such Excess Amount. For purposes of this Section 10.14, "Excess Amount" means
the amount by which such payment exceeds the amount which would have been
received by the Indenture Trustee or the Pass Through Trustee if the Trust had
not become subject to the recourse liability referred to in (b) above.

      Section 10.15 Ownership of and Rights in Units and Pledged Units. The sale
of the Units described on Schedule 1-A hereto and the Existing Equipment
Subleases, the Pledged Units and the Existing Pledged Equipment Leases by TRLTII
contemplated hereby is intended for all purposes to be a true sale of all of
TRLTII's right, title and interest in and to such Units, the Existing Equipment
Subleases, the Pledged Units and the Existing Pledged Equipment Leases to the
Lessee, which shall be the legal owner thereof upon such sale. Upon consummation
of the sale and leaseback transactions contemplated hereby, the Lessee's
interest in such Units is intended to be that of a lessee only. It is intended
that for federal and state income tax purposes the Owner Participant will be the
owner of such Units. The rights of the Indenture Trustee in and to such Units
pursuant to the Indenture is intended to be that of a secured party holding a
security interest, subject to the Lease and the rights of the Lessee thereunder.
No holder of an Equipment Note is intended to have any right, title or interest
in or to such Units except as a beneficiary of the Lien granted by the Owner
Trustee to the Indenture Trustee pursuant to the Indenture in trust for the
equal and ratable benefit of the holders from time to time of the Equipment
Notes.

      Section 10.16 No Petition. Each party hereto agrees that, prior to the
date which is one year and one day after payment in full of all outstanding
Equipment Notes and all obligations of the Lessee under the Operative Agreements
and release of all Collateral held under the Collateral Agency Agreement (i) no
party hereto shall authorize the Lessee, the Owner Trust or the Marks Company to
commence a voluntary winding-up or other voluntary case or other proceeding
seeking liquidation, reorganization or other relief with respect to the Lessee,
the Owner Trust or the Marks Company or their debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect in any jurisdiction
or seeking the appointment of an administrator, a trustee, receiver, liquidator,
custodian or other similar official of the Lessee, the Owner Trust or the Marks
Company or any substantial part of its property or to consent to any such relief
or to the appointment of or taking possession by any such official in an
involuntary case or other proceeding commenced against the Lessee, the Owner
Trust or the Marks Company, or to make a general assignment for the benefit of
any party hereto or any other creditor of the Lessee, the Owner Trust or the
Marks Company, and (ii) none of the parties hereto shall commence or join with
any other Person in commencing any proceeding against the Lessee, the Owner
Trust or the Marks Company under any bankruptcy, reorganization, liquidation or
insolvency law or statute now or hereafter in effect in any jurisdiction. Each
of the parties hereto agrees that, prior to the date which is one year and one
day after the payment in full of all outstanding Equipment Notes and all
obligations of the Lessee under the Operative Agreements and release of all
Collateral held under the Collateral Agency Agreement, it will not institute
against, or join any other

                                       85

Person in instituting against, Lessee, the Owner Trust or the Marks Company an
action in bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or similar proceeding under the laws of the United States or any
state of the United States.

      Section 10.17 Consent To Jurisdiction. Each of the parties hereto hereby
irrevocably and unconditionally:

                  (i) submits for itself and its property in any legal action or
proceeding relating to this Agreement or any other Operative Agreement or for
recognition and enforcement of any judgment in respect hereof or thereof, to the
nonexclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and the appellate courts from any thereof;

                  (ii) consents that any such action or proceeding may be
brought in such courts, and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;

                  (iii) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form and mail), postage prepaid, to each
party hereto at its address set forth in Section 10.4 hereof, or at such other
address of which the other parties shall have been notified pursuant thereto;
and

                  (iv) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction.

      Section 10.18 WAIVER OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, SUIT OR COUNTERCLAIM ARISING IN CONNECTION WITH THIS AGREEMENT.

      Section 10.19 No Partnership Created. The parties hereto do not intend to
create, and nothing herein shall be construed as creating, a partnership or
joint venture for federal income tax purposes. Each party hereto agrees (i) that
it does not have, or intend to form, a joint profit motive with any other party
hereto or any other person with respect to any Unit, Existing Equipment Sublease
or Permitted Sublease, (ii) not to hold itself out to the public as a partner
with any other party hereto, (iii) not to share any profits (including rent or
any other payments to which it is entitled) or losses with respect to its
interest in any Unit, Existing Equipment Sublease or Permitted Sublease, and
(iv) that unless (x) otherwise required by the Internal Revenue Service or like
governmental authority with jurisdiction over income tax matters (the "Required
Position") or (y) such party receives an opinion of its independent tax counsel
that there is no "reasonable basis" (within the meaning of Treasury Regulation
Section 1.6662-3(b)(3)) to claim that no partnership exists, and such party
delivers notice of the receipt of such opinion or notice of the Required
Position to the other parties hereto within ten (10) Business Days of its
receipt of such opinion or notice of the Required Position, it will not file any

                                       86

partnership or other joint income tax return with respect to items of income,
loss, deduction, or credit attributable to its interest in any Unit, Existing
Equipment Sublease or Permitted Sublease.

      Section 10.20 Amendments to Operative Agreements That Are Not Lessee
Agreements. The Owner Trustee, the Indenture Trustee and the Participants shall
not terminate the Operative Agreements to which the Lessee is not or will not be
a party, or amend, supplement, waive or modify in any manner such Operative
Agreements to which the Lessee is not or will not be a party, except (i) in
accordance with such Operative Agreements in effect on the date hereof (as
amended, modified or supplemented from time to time in accordance with the terms
hereof and of such Operative Agreements), or (ii) in a manner that is not
adverse to the Lessee or to any of its rights or interests under any of the
Operative Agreements, unless the prior written consent of the Lessee is
obtained. Without limiting the generality of the foregoing, each of the Owner
Participant and the Owner Trustee, the Pass Through Trustee and the Indenture
Trustee (as applicable) agrees that, in any event, it will not amend Section
2.10 or Article IX of the Indenture or Article IX of the Trust Agreement without
the prior written consent of the Lessee.

      Section 10.21 Acknowledgment of Confidentiality Provisions in Subleases.
Each party to this Agreement acknowledges notice of any confidentiality
provisions contained in the Subleases and Pledged Equipment Leases and agrees to
be bound by such confidentiality provisions as they relate to the identity of
any sub-sublessees or sublessees under such Subleases and Pledged Equipment
Leases, respectively.

SECTION 11. LIMITED GUARANTY.

      Section 11.1 Limited Guaranty. Trinity hereby irrevocably and
unconditionally guarantees for the benefit of each of the Owner Participant, the
Owner Trustee, Trust Company, the Indenture Trustee, the Pass Through Trustee
and the Policy Provider (each, together with their respective permitted
successors and assigns, a "Guaranty Party") the full and punctual payment of all
amounts payable by the Lessee under Sections 7.1 and 7.2 of this Agreement and
all amounts payable by TILC under Section 7.4 of this Agreement (all such
obligations being hereinafter referred to as the "Guaranteed Obligations"). Upon
failure by the Lessee to pay punctually or perform any Guaranteed Obligation,
Trinity shall forthwith on demand pay the amount not so paid or perform the
obligation not so performed in the manner specified in the Operative Agreements.
All payments by Trinity under this guaranty shall be made on the same basis as
payments by the Lessee under the Operative Agreements. This guaranty shall
constitute a guaranty of punctual payment and not of collection, and Trinity
specifically agrees that it shall not be necessary, and that Trinity shall not
be entitled to require, before or as a condition of enforcing the liability of
Trinity under this Section 11 or requiring payment or performance of the
Guaranteed Obligations by Trinity hereunder, or at any time thereafter, that any
Person: (a) file suit or proceed to obtain or assert a claim for personal
judgment against Lessee or any other Person that may be liable for any
Guaranteed Obligation; (b) make any other effort to obtain payment or
performance of any Guaranteed Obligation from Lessee or any other Person that
may be liable for such Guaranteed Obligation; (c) foreclose against or seek to
realize upon any security now or hereafter existing for such Guaranteed
Obligation; (d) exercise or assert any other right or remedy to which such
Person is or be entitled in connection with any Guaranteed Obligation or any
security or other guaranty therefor or (e) assert or file any claim against the
assets of Lessee or any other Person liable for any Guaranteed Obligation.

                                       87

Section 11.2 Guaranty Unconditional. The obligations of Trinity hereunder
shall be continuing and irrevocable, unconditional, absolute, primary and
original and, without limiting the generality of the foregoing, shall not be
released, discharged or otherwise affected by any circumstance or condition,
including, without limitation, the occurrence of any one or more of the
following events:

            (a) any abatement, setoff, defense, reduction, recoupment,
counterclaim, extension, renewal, settlement, compromise, waiver or release in
respect of any obligation of the Lessee under the Operative Agreements, by
operation of law or otherwise;

            (b) any modification or amendment of or supplement to the Operative
Agreements;

            (c) any change in the corporate existence, structure or ownership of
the Lessee, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Lessee or its assets or any resulting release or
discharge of any obligation of the Lessee contained in the Operative Agreements;

            (d) any other act or omission to act or delay of any kind by the
Lessee, the Owner Participant, the Owner Trustee, Trust Company, the Indenture
Trustee, the Pass Through Trustee, the Policy Provider or any Person or any
other circumstance whatsoever which might, but for the provisions of this
paragraph, constitute a legal or equitable discharge of or defense to Trinity's
obligations hereunder;

            (e) any invalidity, unenforceability, impossibility or illegality of
performance of any Operative Agreement or any document related thereto or any of
the Guaranteed Obligations under the Operative Agreements or any provision
thereof, the absence of any action to enforce the same or waiver or consent with
respect to any provision thereof;

            (f) any change in the time, manner or place of performance or
payment of, or in any other term of, all or any of the amounts payable under any
Operative Agreement or any other modification, supplement or amendment or waiver
of or any consent to any departure from the terms and conditions thereof;

            (g) any taking, exchange, release or non-perfection of any
collateral, any furnishing or acceptance of any additional security or any
exchange, surrender, substitution or release of any security or any taking,
release, amendment or waiver of, consent to, or departure from any other
guaranty for, all or any of the Guaranteed Obligations;

            (h) the waiver by any Guaranty Party or any other Person of the
performance or observance by Lessee of any Guaranteed Obligation or of any
default in the performance or observance thereof (except to the extent that the
payment or performance of any Guaranteed Obligation is waived in writing by the
relevant Guaranty Party) or any extension by any Guaranty Party of the time for
payment or performance and discharge by Lessee of any Guaranteed Obligation or
any extension or renewal of any Guaranteed Obligation;

            (i) the recovery of any judgment against any Person or any action to
enforce the same;

                                       88

(j) any failure or delay in the enforcement of the obligations of
any Person under any Operative Agreement (or any other agreement) or any
provision thereof;

            (k) any setoff, counterclaim, deduction,, defense, abatement,
suspension, deferment, diminution, recoupment, limitation or termination
available with respect to any Guaranteed Obligation, and, to the extent
permitted by Law, irrespective of any other circumstances that might otherwise
limit recourse by or against Trinity or any other Person;

            (l) the obtaining, the amendment or the release of the primary or
secondary obligation of any other Person, in addition to Trinity, with respect
to any Guaranteed Obligation;

            (m) any compromise, alteration, amendment, modification, extension,
renewal, release or other change, or waiver, consent or other action, or delay
or omission or failure to act, in respect of any of the terms, covenants or
conditions of any Operative Agreement (except to the extent that the payment or
performance of any Guaranteed Obligation is waived in writing by the relevant
Guaranty Party), or any other agreement or any related document referred to
therein, or any assignment or transfer of any thereof;

            (n) to the maximum extent permitted by Law, any other circumstance
that might otherwise constitute a legal or equitable defense or discharge of a
guarantor or surety with respect to any Guaranteed Obligation (other than the
defense of payment or performance in full by Lessee or Trinity with respect to
any Guaranteed Obligation);

            (o) any matter of application of collateral, or proceeds thereof, to
all or any of the Guaranteed Obligations or any matter of sale or other
disposition of any collateral for all or any of the Guaranteed Obligations or
any of the assets of Lessee or Trinity or any furnishing or acceptance of
additional collateral or the release of any existing security;

            (p) any regulatory change or other governmental action (whether or
not adverse); the partial payment or performance of the Guaranteed Obligations
(whether as a result of the exercise of any right, remedy, power or privilege or
otherwise) shall be accepted or received; or any default, failure or delay,
whether as a result of actual or alleged force majeure, commercial
impracticality or otherwise, in the performance of the Guaranteed Obligations,
or by any other act or circumstance (including, without limitation, any defect
in the title to the 2004-1A SUBI Certificate) which may or might in any manner
or to any. extent vary the risk of Trinity, or which would otherwise operate as
a discharge of Trinity as a matter of law.

Should any money due or owing under this guaranty not be recoverable from
Trinity due to any of the matters specified in Sections 11.2 (a) through (p)
above, then, in any such case, such money shall nevertheless be recoverable from
Trinity as though Trinity were principal debtor in respect thereof and not
merely a guarantor and shall be paid by Trinity forthwith.

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Section 11.3 Discharge Only Upon Payment and Performance in Full;
Reinstatement in Certain Circumstances. Trinity's obligations hereunder are
absolute and unconditional and shall remain in full force and effect until all
the Guaranteed Obligations have been irrevocably paid and performed in full. If
at any time any Guaranteed Obligation payable by the Lessee or any payment by
Trinity hereunder is rescinded or must be otherwise restored or returned upon
the insolvency, bankruptcy or reorganization of the Lessee or Trinity, or upon
or as a result of the appointment of a receiver, intervenor, or conservator of,
or trustee or similar officer for, the Lessee or Trinity or any substantial part
of its property, all as though such payment had not been made and any statute of
limitations in favor of Trinity against any Guaranty Party relating to any such
amount to be restored or returned shall be tolled, or deemed to have been
tolled, to the extent permitted by law, during the period from the date such
payment was made to such Guaranty Party until the date such Guaranty Party so
restores or returns such amount or otherwise, Trinity's obligations hereunder
with respect to such payment shall be reinstated at such time as though such
payment had been due but not made at such time.

            The obligations under this Section 11 are continuing and all
liabilities to which they apply or may apply under the terms hereof shall be
conclusively presumed to have been created in reliance hereon. No failure or
delay on the part of any Guaranty Party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, power of
privilege. The rights, powers and remedies herein expressly provided are
cumulative and not exclusive of any rights, powers and remedies which any
Guaranty Party would otherwise have. No notice or demand on Trinity in any case
shall entitle Trinity to any other further notice or demand in similar or other
circumstances or constitute a waiver of the rights of any Guaranty Party to any
other or further action in any circumstances without notice or demand.

      Section 11.4 Waiver by Trinity. Trinity irrevocably waives acceptance
hereof, presentment, demand, protest and any notice not provided for herein, as
well as any requirement that at any time any action be taken by any Person
against the Lessee or any other Person.

      Section 11.5 Subrogation. The obligations under this Section 11 are the
primary obligations of Trinity. Until the Guaranteed Obligations hereunder have
been indefeasibly paid and performed in full, Trinity irrevocably waives any and
all rights to which it may be entitled, by operation of law or otherwise, upon
making any payment hereunder to be subrogated to the rights of the payee against
the Lessee with respect to such payment or otherwise to be reimbursed,
indemnified or exonerated by or for the account of the Lessee, in respect
thereof.

      Section 11.6 Payments. All payments to be made by Trinity under this
Section 11 to a Guaranty Party shall be paid as provided for in the relevant
Operative Agreement or, if applicable, to such Guaranty Party at the address and
to the account specified in the notice demanding payment be made by Trinity by
wire transfer on the date due at or before 11:00 a.m. (Chicago time) in
immediately available funds to the party to which such payment is to be made, if
such party has provided Trinity with instructions for such wire transfer.

      Section 11.7 Withholding Taxes. All payments by Trinity hereunder shall be
made free and clear of, and without deduction or withholding for or on account
of, any Taxes, unless such

                                       90

deduction or withholding is required by Law. If Trinity shall be required by Law
to make any such deduction or withholding, then Trinity shall make such
deduction or withholding and pay such additional amounts as may be necessary in
order that the net amount received by the applicable Guaranty Party, after
reduction by such deduction or withholding (including any such Taxes as a result
of additional Taxes payable with respect to the receipt or accrual of amounts
payable pursuant to this sentence), shall be equal to the full amount that such
Guaranty Party would have received, after deduction or withholding of Taxes, had
Lessee discharged its obligations (including its tax gross-up obligations).

            Any amounts deducted or withheld by Trinity for or on account of
Taxes shall be paid over to the government or taxing authority imposing such
Taxes in accordance with applicable Law, and Trinity shall provide the
applicable Guaranty Party as soon as practicable with such tax receipts or other
official documentation with respect to the payment of such Taxes as may be
available. Each Guaranty Party shall honor all reasonable requests from Trinity
to file, or to provide Trinity with, such forms, statements, certificates or
other documentation as shall enable such Guaranty Party or Trinity to claim a
reduced rate of tax or exemption from tax with respect to any Taxes required to
be borne by Trinity pursuant to this Section 11.7; provided that such Guaranty
Party is legally entitled to complete, execute and file or provide such
documentation and in such Guaranty Party's judgment such completion, execution
or filing or provision would not have a material adverse effect on such Guaranty
Party.

                                      * * *

                                       91

IN WITNESS WHEREOF, the parties hereto have caused this Participation
Agreement to be executed and delivered, all as of the date first above written.

                                        Lessee:

                                        TRINITY RAIL LEASING IV L.P.

                                        By: TILX GP IV, LLC, its General Partner

                                              By: /s/ Eric Marchetto
                                                  ------------------------------
                                              Name: Eric Marchetto
                                              Title: Vice President

                                        TILC:

                                        TRINITY INDUSTRIES LEASING
                                        COMPANY

                                        By: /s/ Eric Marchetto
                                            ------------------------------------
                                        Name: Eric Marchetto
                                        Title: Vice President

                                        TRLTII:

                                        TRINITY RAIL LEASING TRUST II

                                        By: TRINITY INDUSTRIES LEASING
                                        COMPANY, its Manager

                                              By: /s/ Eric Marchetto
                                                  ------------------------------
                                              Name: Eric Marchetto
                                              Title: Vice President

                                        Trinity:

                                        TRINITY INDUSTRIES, INC.

                                        By: /s/ S.Theis Rice
                                            ------------------------------------
                                        Name: S. THEIS RICE
                                        Title: VICE PRESIDENT LEGAL AFFAIRS

           Signature Page to Participation Agreement (TRLIV 2004-1A )

Trust:

                                        TRLIV 2004-1A RAILCAR STATUTORY TRUST

                                        By:   U.S. Bank Trust National
                                              Association, not in its individual
                                              capacity except as expressly
                                              provided herein but solely as
                                              Owner Trustee

                                        By: /s/ Earl W. Dennison
                                            ------------------------------------
                                        Name: EARL W. DENNISON
                                        Title: VICE PRESIDENT

                                        Trust Company:

                                        U.S. BANK TRUST NATIONAL
                                        ASSOCIATION

                                        By: /s/ Earl Dennison
                                            ------------------------------------
                                        Name: Earl Dennison
                                        Title: Vice President

           Signature Page to Participation Agreement (TRLIV 2004-1A )

Owner Participant:

                                        THE FIFTH THIRD LEASING
                                        COMPANY

                                        By: /s/ Malcolm J. Ferguson
                                            ------------------------------------
                                        Name: Malcolm J. Ferguson
                                        Title: Vice President

                     Signature Page to PA (TRLIV 2004-1A )

Indenture Trustee:

                                        WILMINGTON TRUST COMPANY, not
                                        in its individual capacity except as
                                        expressly provided herein but solely
                                        as Indenture Trustee

                                        By: /s/ W. Chris Sponenberg
                                            ------------------------------------
                                        Name: W. Chris Sponenberg
                                        Title: Vice President

                                        Pass Through Trustee:

                                        WILMINGTON TRUST COMPANY, not in its
                                        individual capacity except as expressly
                                        provided herein but solely as Pass
                                        Through Trustee

                                        By:  /s/ W. Chris Sponenberg
                                             -----------------------------------
                                        Name: W. Chris Sponenberg
                                        Title: Vice President

           Signature Page to Participation Agreement (TRLIV 2004-1A )

Policy Provider:

                                        AMBAC ASSURANCE
                                        CORPORATION

                                        By: /s/ David B. Nemschoff
                                            ------------------------------------
                                        Name: David B. Nemschoff
                                        Title: Managing Director

           Signature Page to Participation Agreement (TRLIV 2004-1A )Exh 10.19 12.31.2013

EXHIBIT 10.19
EXECUTION VERSION
U.S. $572,204,148
TERM LOAN AGREEMENT
dated as of May 9, 2008
among
TRINITY RAIL LEASING VI LLC,
THE COMMITTED LENDERS AND THE CONDUIT LENDERS
 FROM TIME TO TIME PARTY HERETO,
DVB BANK AG,
 as Agent,
and
WILMINGTON TRUST COMPANY,
 as Collateral Agent and Depositary
 

 

TABLE OF CONTENTS
	
							
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	Page
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE I DEFINITIONS
	 
	 
	1
	 

	SECTION 1.01
	 
	Defined Terms
	 
	 
	1
	 

	SECTION 1.02
	 
	Computation of Time Periods and Other Definitional Provisions
	 
	 
	37
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE II THE CREDIT FACILITY
	 
	 
	37
	 

	SECTION 2.01
	 
	Commitment to Lend
	 
	 
	37
	 

	SECTION 2.02
	 
	Procedures for Borrowing
	 
	 
	37
	 

	SECTION 2.03
	 
	Notice to Committed Lenders; Funding of Loans
	 
	 
	38
	 

	SECTION 2.04
	 
	Evidence of Loans
	 
	 
	39
	 

	SECTION 2.05
	 
	Interest
	 
	 
	40
	 

	SECTION 2.06
	 
	Repayment and Maturity of Loans
	 
	 
	41
	 

	SECTION 2.07
	 
	Prepayments
	 
	 
	41
	 

	SECTION 2.08
	 
	Optional Replacement of Lenders (Non-Pro-Rata)
	 
	 
	47
	 

	SECTION 2.09
	 
	Agent Fee Letter
	 
	 
	48
	 

	SECTION 2.10
	 
	Pro-rata Treatment
	 
	 
	48
	 

	SECTION 2.11
	 
	Sharing of Payments
	 
	 
	49
	 

	SECTION 2.12
	 
	Payments, Computations, Proceeds of Collateral, Etc
	 
	 
	49
	 

	SECTION 2.13
	 
	Interest Rate Risk Management
	 
	 
	50
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY
	 
	 
	51
	 

	SECTION 3.01
	 
	Taxes
	 
	 
	51
	 

	SECTION 3.02
	 
	Illegality
	 
	 
	54
	 

	SECTION 3.03
	 
	Increased Costs and Reduced Return
	 
	 
	54
	 

	SECTION 3.04
	 
	Funding Losses
	 
	 
	55
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE IV CONDITIONS
	 
	 
	56
	 

	SECTION 4.01
	 
	Conditions to Effectiveness of this Agreement
	 
	 
	56
	 

	SECTION 4.02
	 
	Conditions to the Closing Date
	 
	 
	57
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE V REPRESENTATIONS AND WARRANTIES
	 
	 
	64
	 

	SECTION 5.01
	 
	Organization and Good Standing
	 
	 
	64
	 

	SECTION 5.02
	 
	Power; Authorization; Enforceable Obligations
	 
	 
	64
	 

	SECTION 5.03
	 
	No Conflicts
	 
	 
	65
	 

i

 

TABLE OF CONTENTS
 (continued)
	
							
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	Page
	 

	 
	 
	 
	 
	 
	 
	 

	SECTION 5.04
	 
	 
	65
	 

	SECTION 5.05
	 
	Financial Condition
	 
	 
	65
	 

	SECTION 5.06
	 
	No Material Change
	 
	 
	66
	 

	SECTION 5.07
	 
	Title to Properties
	 
	 
	66
	 

	SECTION 5.08
	 
	 
	66
	 

	SECTION 5.09
	 
	Taxes
	 
	 
	67
	 

	SECTION 5.10
	 
	Compliance with Law
	 
	 
	67
	 

	SECTION 5.11
	 
	Subsidiaries
	 
	 
	67
	 

	SECTION 5.12
	 
	Governmental Regulations, Etc
	 
	 
	67
	 

	SECTION 5.13
	 
	Purpose of Loans
	 
	 
	68
	 

	SECTION 5.14
	 
	Environmental Matters
	 
	 
	68
	 

	SECTION 5.15
	 
	Intellectual Property
	 
	 
	68
	 

	SECTION 5.16
	 
	Solvency
	 
	 
	68
	 

	SECTION 5.17
	 
	Disclosure
	 
	 
	68
	 

	SECTION 5.18
	 
	Security Documents
	 
	 
	69
	 

	SECTION 5.19
	 
	Ownership
	 
	 
	69
	 

	SECTION 5.20
	 
	Lease Documents
	 
	 
	69
	 

	SECTION 5.21
	 
	Sole Business of the Borrower
	 
	 
	69
	 

	SECTION 5.22
	 
	Separate Corporate Structure; No Employees
	 
	 
	69
	 

	SECTION 5.23
	 
	 
	71
	 

	SECTION 5.24
	 
	Railcars
	 
	 
	71
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE VI AFFIRMATIVE COVENANTS
	 
	 
	71
	 

	SECTION 6.01
	 
	Information
	 
	 
	71
	 

	SECTION 6.02
	 
	Preservation of Existence and Franchises; Authorizations, Approvals and Recordations
	 
	 
	73
	 

	SECTION 6.03
	 
	 
	74
	 

	SECTION 6.04
	 
	ERISA
	 
	 
	74
	 

	SECTION 6.05
	 
	Payment of Taxes and Other Debt
	 
	 
	74
	 

	SECTION 6.06
	 
	Insurance; Certain Proceeds; Casualty Proceeds
	 
	 
	74
	 

	SECTION 6.07
	 
	 
	76
	 

Term Loan Agreement
ii

 

TABLE OF CONTENTS
 (continued)
	
							
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	Page
	 

	 
	 
	 
	 
	 
	 
	 

	SECTION 6.08
	 
	 
	78
	 

	SECTION 6.09
	 
	Replacement of Railcars; Substitution Account
	 
	 
	79
	 

	SECTION 6.10
	 
	Use of Proceeds
	 
	 
	80
	 

	SECTION 6.11
	 
	Audits/Inspections/Appraisals
	 
	 
	80
	 

	SECTION 6.12
	 
	 
	81
	 

	SECTION 6.13
	 
	Follow-On Leases
	 
	 
	81
	 

	SECTION 6.14
	 
	Accounts
	 
	 
	81
	 

	SECTION 6.15
	 
	Servicer
	 
	 
	82
	 

	SECTION 6.16
	 
	Action after an Event of Default
	 
	 
	83
	 

	SECTION 6.17
	 
	Required Asset Dispositions
	 
	 
	83
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE VII NEGATIVE COVENANTS
	 
	 
	83
	 

	SECTION 7.01
	 
	Limitation on Debt
	 
	 
	83
	 

	SECTION 7.02
	 
	Restriction on Liens
	 
	 
	83
	 

	SECTION 7.03
	 
	Nature of Business
	 
	 
	83
	 

	SECTION 7.04
	 
	Consolidation, Merger and Dissolution
	 
	 
	84
	 

	SECTION 7.05
	 
	Asset Dispositions
	 
	 
	84
	 

	SECTION 7.06
	 
	Investments
	 
	 
	84
	 

	SECTION 7.07
	 
	Restricted Payments, etc
	 
	 
	85
	 

	SECTION 7.08
	 
	 
	85
	 

	SECTION 7.09
	 
	Fiscal Year; Organization and Other Documents
	 
	 
	85
	 

	SECTION 7.10
	 
	Additional Negative Pledges
	 
	 
	85
	 

	SECTION 7.11
	 
	Impairment of Security Interests
	 
	 
	86
	 

	SECTION 7.12
	 
	Interest Coverage Tests
	 
	 
	86
	 

	SECTION 7.13
	 
	No Amendments to the Lease Documents
	 
	 
	86
	 

	SECTION 7.14
	 
	 
	86
	 

	SECTION 7.15
	 
	Consolidation with Any Other Person
	 
	 
	86
	 

	SECTION 7.16
	 
	Limitations on Employees, Subsidiaries
	 
	 
	86
	 

	SECTION 7.17
	 
	Independence of Covenants
	 
	 
	86
	 

	 
	 
	 
	 
	 

	ARTICLE VIII OTHER REPRESENTATIONS, WARRANTIES AND COVENANTS
	 
	 
	87
	 

iii

 

TABLE OF CONTENTS
 (continued)
	
							
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	Page
	 

	 
	 
	 
	 
	 
	 
	 

	SECTION 8.01
	 
	 
	87
	 

	SECTION 8.02
	 
	Quiet Enjoyment
	 
	 
	87
	 

	SECTION 8.03
	 
	Lender’s Covenant
	 
	 
	87
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE IX DEFAULTS
	 
	 
	87
	 

	SECTION 9.01
	 
	Events of Default
	 
	 
	87
	 

	SECTION 9.02
	 
	Acceleration; Remedies
	 
	 
	90
	 

	SECTION 9.03
	 
	Priority of Security Interests
	 
	 
	91
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE X AGENCY PROVISIONS
	 
	 
	92
	 

	SECTION 10.01
	 
	Appointment; Authorization
	 
	 
	92
	 

	SECTION 10.02
	 
	Delegation of Duties
	 
	 
	93
	 

	SECTION 10.03
	 
	Exculpatory Provisions
	 
	 
	93
	 

	SECTION 10.04
	 
	Reliance on Communications
	 
	 
	93
	 

	SECTION 10.05
	 
	Notice of Default
	 
	 
	94
	 

	SECTION 10.06
	 
	Credit Decision; Disclosure of Information by Agent or Collateral Agent
	 
	 
	94
	 

	SECTION 10.07
	 
	Indemnification
	 
	 
	95
	 

	SECTION 10.08
	 
	Agent and Collateral Agent in Their Individual Capacities
	 
	 
	95
	 

	SECTION 10.09
	 
	Term; Successor Agents
	 
	 
	96
	 

	SECTION 10.10
	 
	 
	96
	 

	 
	 
	 
	 
	 
	 
	 

	ARTICLE XI MISCELLANEOUS
	 
	 
	96
	 

	SECTION 11.01
	 
	Notices and Other Communications
	 
	 
	96
	 

	SECTION 11.02
	 
	No Waiver; Cumulative Remedies
	 
	 
	97
	 

	SECTION 11.03
	 
	Amendments, Waivers and Consents
	 
	 
	98
	 

	SECTION 11.04
	 
	 
	100
	 

	SECTION 11.05
	 
	Indemnification
	 
	 
	101
	 

	SECTION 11.06
	 
	Successors, Assigns, and Participants
	 
	 
	103
	 

	SECTION 11.07
	 
	Confidentiality
	 
	 
	107
	 

	SECTION 11.08
	 
	 
	108
	 

	SECTION 11.09
	 
	Interest Rate Limitation
	 
	 
	108
	 

	SECTION 11.10
	 
	Counterparts
	 
	 
	109
	 

iv

 

TABLE OF CONTENTS
 (continued)
	
							
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	Page
	 

	 
	 
	 
	 
	 
	 
	 

	SECTION 11.11
	 
	 
	109
	 

	SECTION 11.12
	 
	Survival of Representations and Warranties
	 
	 
	109
	 

	SECTION 11.13
	 
	Severability
	 
	 
	109
	 

	SECTION 11.14
	 
	Headings
	 
	 
	110
	 

	SECTION 11.15
	 
	 
	110
	 

	SECTION 11.16
	 
	Performance by the Agent
	 
	 
	110
	 

	SECTION 11.17
	 
	Third Party Beneficiaries
	 
	 
	110
	 

	SECTION 11.18
	 
	No Proceedings
	 
	 
	110
	 

	SECTION 11.19
	 
	Governing Law; Submission to Jurisdiction
	 
	 
	111
	 

	SECTION 11.20
	 
	Waiver of Jury Trial
	 
	 
	111
	 

	SECTION 11.21
	 
	Binding Effect
	 
	 
	112
	 

	SECTION 11.22
	 
	The Patriot Act
	 
	 
	112
	 

	SECTION 11.23
	 
	Railcar Subsidiaries
	 
	 
	112
	 

	SECTION 11.24
	 
	Federal Income Tax Treatment
	 
	 
	112
	 

v

 

TABLE OF CONTENTS
 (continued)
SCHEDULES:
	
					
	 
	 
	 
	 
	 

	Schedule 1.01
	 
	0
	 
	Lenders and Commitments

	Schedule 1.03
	 
	0
	 
	Target Principal Factor

	Schedule 5.02
	 
	Required Consents, Authorizations, Notices and Filings

	Schedule 5.11
	 
	0
	 
	Railcar Subsidiaries

	Schedule 6.06
	 
	0
	 
	Insurance

	Schedule 11.01
	 
	0
	 
	Notice Addresses; Agent’s Office

EXHIBITS:
	
					
	 
	 
	 
	 
	 

	Exhibit A-1
	 
	0
	 
	Form of Request

	Exhibit A-2
	 
	0
	 
	Form of Notice of Borrowing

	Exhibit A-3
	 
	Form of Additional Collateral Certificate

	Exhibit A-4
	 
	0
	 
	Form of Financing Notice

	Exhibit A-5
	 
	0
	 
	Form of Monthly Report

	Exhibit A-6
	 
	0
	 
	Form of Qualifying Replacement Railcar Certificate

	Exhibit B
	 
	Form of Note

	Exhibit C
	 
	0
	 
	Form of Assignment and Acceptance

	Exhibit D-1
	 
	0
	 
	Form of Opinion of Counsel for the Borrower, the Servicer and the Seller

	Exhibit D-2
	 
	0
	 
	Form of Opinion of In-House Counsel for the Borrower, the Servicer and the Seller

	Exhibit D-3
	 
	 
	 
	Form of Opinion of Delaware Counsel to the Borrower

	Exhibit D-4
	 
	0
	 
	Form of True Sale, Nonconsolidation and Non-Rejection Opinion

	Exhibit D-5
	 
	0
	 
	Form of Opinion of Special STB Counsel for the Borrower

	Exhibit D-6
	 
	0
	 
	Form of Opinion of Special Canadian Counsel for the Borrower

	Exhibit D-7
	 
	 
	 
	Form of Opinion of Counsel for the Marks Company

	Exhibit D-8
	 
	0
	 
	Form of Opinion of Counsel for the Collateral Agent and the Depositary

	Exhibit E-1
	 
	0
	 
	Form of Perfection Certificate

	Exhibit E-2
	 
	0
	 
	Form of Payment Notice/Lessor Right’s Notice

	Exhibit F
	 
	0
	 
	Form of Depository Agreement

	Exhibit G
	 
	0
	 
	Form of Servicing Agreement

	Exhibit H
	 
	0
	 
	Form of Insurance Management Agreement

	Exhibit I-1
	 
	Form of Full Service Railcar Lease Agreement

	Exhibit I-2
	 
	0
	 
	Form of Net Railcar Lease Agreement

	Exhibit I-3
	 
	0
	 
	Form of Per Diem Lease Agreement

	Exhibit J-1
	 
	0
	 
	Form of Purchase and Sale Agreement (TILC)

	Exhibit J-2
	 
	0
	 
	Form of Purchase and Sale Agreement (Trinity Rail Leasing Trust II)

	Exhibit K
	 
	0
	 
	Form of Administrative Services Agreement

	Exhibit L-1
	 
	Form of Officer’s Certificate (Closing Date)

	Exhibit L-2
	 
	0
	 
	Form of Officer’s Certificate

	Exhibit M
	 
	0
	 
	Form of Performance Guaranty

	Exhibit N
	 
	0
	 
	Form of Purchase Price Certificate

vi

 

TERM LOAN AGREEMENT
     This Term Loan Agreement is dated as of May 9, 2008 and is among TRINITY RAIL LEASING VI LLC, a Delaware limited liability company (the “ Borrower ”), the committed lenders and the conduit lenders from time to time party hereto (each a “ Lender ” and collectively, the “ Lenders ”, as such terms are defined below), DVB BANK AG as Agent for the Lenders referred to herein (in such capacity, the “ Agent ”), and WILMINGTON TRUST COMPANY, in its capacity as Collateral Agent and Depositary for the Protected Parties referred to herein (in such capacity, the “ Collateral Agent ”).
     The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
     SECTION 1.01 Defined Terms. The following terms, as used herein, have the following meanings:
     “A.A.R.” means the Association of American Railroads, and its successors.
     “Accounts” means, collectively, the Collection Account, the Maintenance Reserve Account, the Modifications and Improvements Account, the Operating Expenses Account, the Security Deposit Account, the Liquidity Reserve Account, the Prefunding Account, the Net Cash Proceeds Account and the Substitution Account.
     “Additional Collateral Certificate” means a certificate substantially in the form of Exhibit A-3 hereto, with appropriate insertions and deletions or with such other changes as may be reasonably agreed to by the Collateral Agent and the Agent, and which certificate contains a description of the Railcars and related Leases which are to become Portfolio Railcars and Portfolio Leases, as the case may be.
     “Adjusted Collateral Value” means, with respect to any Railcar as of any date of determination, the difference of (a) the Original Value of such Railcar  minus  (b) the  product  of (x) the Monthly Depreciation of such Railcar  multiplied  by (y) the number of Measuring Periods elapsed since the date such Railcar was acquired by the Borrower to such date of determination.
     “Adjusted Eurodollar Rate” means, for each Interest Period, the quotient obtained (rounded upward, if necessary, to the next higher 1/100th of 1%) by dividing (i) the applicable London Interbank Offered Rate for such Interest Period by (ii) 1.00  minus  the Eurodollar Reserve Percentage.
     “Administrative Questionnaire” means, with respect to each Lender, an administrative questionnaire in the form prepared by the Agent and submitted to the Agent (with a copy to the Borrower) duly completed by such Lender.
 

 
 

    “Administrative Services Agreement” means the Administrative Services Agreement, substantially in the form of Exhibit K  hereto, dated as of the Closing Date between the Borrower and TILC.
     “Advance Rate” means a percentage equal to 77%.
     “Affiliate” means, with respect to any Person, (i) any Person that directly, or indirectly through one or more intermediaries, controls such Person (including all directors and officers of such Person) (a “ Controlling Person ”) or (ii) any other Person which is controlled by or is under common control with a Controlling Person. As used herein, the term “ control ” means (i) with respect to any Person having voting shares or their equivalent and elected directors, managers or Persons performing similar functions, the possession, directly or indirectly, of the power to vote 10% or more of the Equity Interests having ordinary voting power of such Person, (ii) the ownership, directly or indirectly, of 10% or more of the Equity Interests in any Person or (iii) the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting shares or their equivalent, by contract or otherwise.
     “Agent” means DVB Bank AG, in its capacity as agent for the Lenders hereunder and under the other Loan Documents, and its successor or successors in such capacity.
     “Agent Fee Letter” means the agent fee letter agreement dated as of May 9, 2008 between the Borrower and the Agent regarding certain fees payable to Agent and/or its Affiliates in connection with the transactions contemplated herein.
     “Agent’s Office” means the Agent’s address and, as appropriate, account as set forth and identified as such in  Schedule 11.01 , or such other address and account as the Agent may from time to time notify to the Borrower and the Lenders.
     “Aggregated Default Interest” has the meaning set forth in Section 2.05(a).
     “Aggregated Default Interest Rate” means 200 basis points per annum.
     “Aggregate Original Value” means, as of any date of determination with respect to any specified group of Railcars, the aggregate of the Original Values of all such Railcars (including any such Railcars which will become Portfolio Railcars on the Closing Date, but excluding any such Railcars which will cease to be Portfolio Railcars at the time of such determination pursuant to Section 9.12 of the Security Agreement or otherwise).
     “Agreement” means this Term Loan Agreement, as amended, supplemented, amended and restated or otherwise modified from time to time.
     “Allocable Debt” means, with respect to any Railcar as of any date of determination, the product of (x) the Allocable Percentage related to such Railcar immediately prior to such date  multiplied  by (y) the aggregate outstanding principal amount of the Loans as of such date.
     “Allocable Percentage” means, with respect to any Railcar as of any date of determination, a fraction, expressed as a decimal carried to five (5) decimal places, equal to the
2

 

quotient of (x) the Original Value for such Railcar divided by (y) the Aggregate Original Value of all Portfolio Railcars.
     “Amortization Event” means on any Calculation Date, any of the following:
          (a) the Average Six Month Interest Coverage Ratio is less than 1.60:1.00;
          (b) the Expected Maturity Date has occurred; or
          (c) a Servicer Replacement Event has occurred.
     “Applicable Facility Margin” means, with respect to the Loans at any time, 150 basis points.
     “Applicable Law” means, with reference to any Person, all laws (foreign or domestic), statutes, rulings, codes, ordinances and treaties, including the FRA and the Interchange Rules, and all judgments, decrees, injunctions, writs and orders of any court, arbitrator or other Governmental Authority, and all rules, regulations, orders, interpretations, directives, licenses and permits of any governmental body, instrumentality, agency or other regulatory authority applicable to such Person or its property or in respect of its operations.
     “Applicable Rate” means, with respect to the Loans for any day during any Interest Period, the sum of (i) the Adjusted Eurodollar Rate for such Interest Period,  plus  (ii) the Applicable Facility Margin,  plus  (iii) the Step-Up Yield for such Interest Period, if any (for the avoidance of doubt, the “Applicable Rate” for the Interest Period commencing on the Prefunding Date and ending on the Closing Date shall be determined under this paragraph).
     “Appraised Fair Market Value”, with respect to any Railcar, means the amount set forth in the Independent Appraisal with respect thereto as the amount, expressed in terms of Dollars, that may reasonably be expected for property exchanged between a willing buyer and a willing seller with equity to both, neither under any compulsion to buy or sell and both fully aware of all relevant, reasonably ascertainable facts.
     “Approved Fund” means (i) with respect to any Lender, an entity (whether a corporation, partnership, limited liability company, trust or otherwise) that is engaged in making, purchasing, holding or otherwise investing in bank loans and similar extensions of credit in the ordinary course of its business and is managed by such Lender or an Affiliate of such Lender, (ii) with respect to any Lender that is a fund that invests in bank loans and similar extensions of credit, any other fund that invests in bank loans and similar extensions of credit and is managed by the same investment advisor as such Lender or by an Affiliate of such investment advisor, (iii) any Conduit Lender and (iv) with respect to any Conduit Lender, any of its Support Parties.
     “Asset Disposition” means any sale, lease or other disposition by the Borrower (other than the lease of a Railcar pursuant to an Eligible Lease) of any Portfolio Railcar, Portfolio Lease or other item of Collateral, whether by sale (including a Permitted Discretionary Sale), lease, transfer, Event of Loss, Condemnation or otherwise (for the avoidance of doubt, not including a Casualty but including any subsequent sale of a Railcar subject to a Casualty);  provided however , the rescission of the transfer of a Railcar from the applicable Seller to the Borrower
3

 

pursuant to Section 4.9 of the applicable Purchase and Sale Agreement shall not be deemed to be an Asset Disposition.
     “Assignment and Acceptance” means an Assignment and Acceptance, substantially in the form of Exhibit C hereto, under which an interest of a Lender hereunder is transferred to an Eligible Assignee pursuant to  Section 11.06(b) .
     “Autorack” means a Railcar or unit of railroad rolling stock (other than a locomotive) used to transport unladen automobiles or unladen light trucks.
     “Available Collections” during any Measuring Period shall be equal to the sum of (i) the aggregate amount of Monthly Rent actually collected and paid into the Collection Account (including amounts used from any Security Deposits to cover Monthly Rent),  plus  (ii) payments of Railroad Mileage Credits received by the Borrower,  plus  (iii) all insurance or other third party payments in respect of any Casualty the Borrower elects to apply as “Available Collections” in accordance with  Section 6.06(b)  (or otherwise applied as “Available Collections” in accordance with such Section), plus  (iv) Net Cash Proceeds, if any, remaining after the distribution of such proceeds in  clauses first  and  second  in Section 2.07(c)(iii) ,  plus  (v) interest earned on deposits in the Collection Account and  plus  (vi) to the extent a shortfall exists to pay interest on the amount of outstanding Loans and to pay the items described in  clauses first ,  second ,  third ,  fourth  and  fifth , in  Section 2.07(c)(i) , or the items described in  clauses first ,  second ,  third ,  fourth , and  fifth  in  Section 2.07(c)(ii) , as applicable, amounts drawn from the Liquidity Reserve Account, in each case during such Measuring Period. “Available Collections” shall not include Excepted Payments.
     “Average Six Month Interest Coverage Ratio” means, with respect to any Settlement Date (commencing on the Settlement Date occurring in November, 2008), the  ratio  of (i) the  sum  of (A) the aggregate amount of Monthly Rent actually collected and paid into the Collection Account (including amounts used from any Security Deposits to cover Monthly Rent),  plus (B) payments of Railroad Mileage Credits to the Borrower,  plus  (C) interest earned under deposits in all Accounts,  minus (D) Borrower obligations and expenses (including Operating Expenses, the cost of replacement Parts and Servicer’s Fees, but excluding interest expense accrued and principal payable on the Loans) that are then due or that have become due, in each case with respect to the six most recent Measuring Periods ended on or prior to the Calculation Date immediately preceding such Settlement Date, to (ii) the  sum  of (A) the amount of interest expense accrued on the Loans  minus  (B) any amounts (other than any Derivatives Termination Value) owed to the Borrower as of such Settlement Date under any Derivatives Agreements,  plus (C) any amounts (other than any Derivatives Termination Value) owed by the Borrower as of such Settlement Date under any Derivatives Agreements, in each case with respect to the six most recent Measuring Periods ended on or prior to the Calculation Date immediately preceding such Settlement Date.
     “Bankruptcy Code” means the United States Bankruptcy Reform Act of 1978, as amended, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization or similar debtor relief laws of the United States or other applicable jurisdiction from time to time affecting the rights of creditors generally.
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     “basis point” means one-hundredth of a percent (0.01%).
     “Bill of Sale” means a bill of sale delivered to the Borrower from the Seller with respect to a Railcar and, if applicable, any related Lease, in connection with the Borrower’s purchase of such Railcar and related Lease from such Seller.
     “Books and Records” has the meaning set forth in Section 6.11.
     “Books and Records Inspection” has the meaning set forth in Section 6.11.
     “Borrower” means Trinity Rail Leasing VI LLC, a Delaware limited liability company.
     “Borrowing” means the borrowing of Loans pursuant to Section 2.01 hereof.
     “Business Day” means any day of the week, other than a Saturday or a Sunday, on which banks are open for business in London for the conduct of transactions in the London interbank market and on which commercial banks in Wilmington, Delaware, New York City, Dallas, Texas and Frankfurt, Federal Republic of Germany are open for business and are not required or authorized by law, executive order or governmental decree to be closed.
     “Calculation Date” means with respect to any Settlement Date, the last day of the calendar month immediately preceding such Settlement Date.
     “Capital Lease” of any Person means any lease of property (whether real, personal or mixed) by such Person as lessee which would, in accordance with GAAP, be required to be accounted for as a capital lease on the balance sheet of such Person.
     “Cash Equivalents” means (a) marketable direct obligations issued by, or fully and unconditionally guaranteed by, the United States Government or issued by any agency or instrumentality thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition, (b) certificates of deposit, time deposits, eurocurrency time deposits or overnight bank deposits having maturities of one year or less from the date of acquisition issued by any United States commercial bank having a long-term unsecured debt rating of at least “AA” by S&P or “Aa2” by Moody’s (or equivalent ratings by another nationally recognized credit rating agency if both such corporations are not in the business of rating long-term senior unsecured debt of commercial banks), (c) commercial paper of an issuer rated at the time of acquisition at least A-1+ by S&P or P1 by Moody’s or carrying an equivalent rating by an internationally recognized rating agency, if both of the two named rating agencies cease publishing ratings of commercial paper issuers generally, and maturing within one year from the date of acquisition, (d) repurchase obligations of any commercial bank satisfying the requirements of clause (b) of this definition, having a term of not more than 30 days, with respect to securities issued or fully guaranteed or insured by the United States Government, (e) securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at the time of acquisition at least A-1+ by S&P or P1 by Moody’s or carrying an equivalent rating by an internationally
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recognized rating agency, (f) securities with maturities of one year or less from the date of acquisition backed by standby letters of credit issued by a commercial bank satisfying the requirements of  clause (b)  of this definition or (g) shares of money market mutual or similar funds that are registered with the Securities and Exchange Commission under the Investment Company Act of 1940, as amended, and operated in accordance with Rule 2a-7 thereunder and that, at the time of such investment, are rated “Aaa” by Moody’s and/or “AAA” by S&P or invest exclusively in assets satisfying the requirements of clauses (a) through (f) of this definition.
     “Casualty” means any casualty, loss, damage, destruction or other similar loss with respect to any Portfolio Railcar or other item of Collateral constituting a partial loss.
     “Casualty Insurance Policy” means any insurance policy maintained by or on behalf of the Borrower covering losses with respect to Casualties involving one or more Portfolio Railcars or other items of Collateral.
     “Casualty Proceeds” means all proceeds under any Casualty Insurance Policy, and all other insurance proceeds, damages, awards, claims and rights of action of the Borrower with respect to any Casualty.
     “Change of Control” means the occurrence of any of the following: (i) Trinity shall cease to own (directly or indirectly) at least 51% of the Equity Interests of TILC, so long as TILC is the Servicer, on a fully-diluted basis assuming the conversion and exercise of all outstanding Equity Equivalents (whether or not such securities are then convertible or unexercisable) or (ii) TILC shall cease to own directly 100% of the Equity Interests of the Borrower on a fully diluted basis assuming the conversion and exercise of all outstanding Equity Equivalents (whether or not such securities are then currently convertible or exercisable).
     “Chattel Paper Legend” means the following statement: “COUNTERPART No. ___OF ___ SERIALLY NUMBERED COUNTERPARTS. TO THE EXTENT THAT THIS DOCUMENT CONSTITUTES CHATTEL PAPER UNDER THE UNIFORM COMMERCIAL CODE IN EFFECT IN ANY APPLICABLE JURISDICTION, NO SECURITY INTEREST IN THIS DOCUMENT MAY BE CREATED THROUGH THE TRANSFER AND POSSESSION OF ANY COUNTERPART OTHER THAN COUNTERPART NO. 1”.
     “Claim” has the meaning set forth in Section 3.01(j).
     “Closing Date” means the date on or after the Effective Date when the Borrowing occurs in accordance with this Agreement.
     “Closing Rating Agency Condition” means a condition that is satisfied when S&P has confirmed in writing to the Borrower, the Agent, the Collateral Agent and each Derivatives Creditor that the Loans will be rated no lower than “A-” by S&P.
     “Code” means the Internal Revenue Code of 1986, as amended, and any successor statute thereto, as interpreted by the rules and Treasury Regulations issued thereunder, in each case as in effect from time to time. Reference to particular sections of the Code shall be construed also to refer to any successor sections.
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     “Collateral” means all of the property which is subject or is purported to be subject to the Liens granted by the Collateral Documents.
     “Collateral Agent” means Wilmington Trust Company in its capacity as collateral agent and representative for the Protected Parties under the Parent Security Agreement and the Security Agreement and the Depository Agreement.
     “Collateral Documents” means, collectively, the Security Agreement, the Parent Security Agreement, each Perfection Certificate, the Depository Agreement, the Customer Collections Account Administration Agreement, Performance Guaranty, any additional pledges, security agreements, patent, trademark or copyright filings or mortgages required to be delivered pursuant to the Loan Documents and any instruments of assignment, control agreements, lockbox letters or other instruments or agreements executed pursuant to the foregoing.
     “Collection Account” means the Collection Account established by the Depositary pursuant to the Depository Agreement.
     “Commitment” means, with respect to any Lender, the commitment amount of such Lender, in an aggregate principal amount  equal to  (i) such Lender’s Commitment Percentage  multiplied  by (ii) the Initial Principal Amount.
     “Commitment Percentage” means, for each Lender, the percentage identified as its Commitment Percentage on Schedule 1.01  hereto or in the applicable Assignment and Acceptance, as such percentage may be modified in connection with any assignment made in accordance with the provisions of  Section 11.06(b) .
     “Commitment Termination Date” means June 9, 2008.
     “Committed Lender” means any Lender other than a Conduit Lender.
     “Committed Lender Fee Letter” means each committed lender fee letter agreement dated as of May 9, 2008 between the Borrower and a particular Committed Lender regarding certain fees payable to such Committed Lender on the Closing Date in connection with the transactions contemplated herein.
     “Company Inspection” has the meaning set forth in Section 6.11.
     “Competitor of the Borrower” means a Person who either (i) is engaged in the railcar leasing or manufacturing business or (ii) has a material non-passive investment interest (whether held directly or indirectly) in, or is otherwise an Affiliate of, a Person that is engaged in the railcar leasing or manufacturing business.
     “Concentration Excess Amount” means, as of any Calculation Date, the sum (without duplication) of the following amounts (including in such calculation amounts in respect of Railcars which will become Portfolio Railcars on the Closing Date, but excluding amounts in respect of any Railcars which will cease to be Portfolio Railcars at the time of such determination pursuant to Section 9.12 of the Security Agreement or otherwise):
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     (i) for each single Lessee whose unsecured, unsubordinated, non-credit enhanced long-term indebtedness for money borrowed is rated at least BBB- by S&P, the amount by which (x) the Aggregate Original Value of all Portfolio Railcars subject to one or more Leases to such Lessee exceeds (y) 20% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date;  plus
     (ii) the amount by which (x) the Aggregate Original Value of all Portfolio Railcars subject to one or more Leases to Lessees whose unsecured, unsubordinated, non-credit enhanced long-term indebtedness for money borrowed is not rated by S&P or is rated lower than BBB- by S&P exceeds (y) 60% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date;  plus
     (iii) for each single Lessee whose unsecured, unsubordinated, non-credit enhanced long-term indebtedness for money borrowed is not rated by S&P or is rated below BBB- by S&P, the amount by which (x) the Aggregate Original Value of all Portfolio Railcars subject to one or more Leases to such Lessee exceeds (y) 12.5% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date;  plus
     (iv) the amount by which (x) the Aggregate Original Value of all Portfolio Railcars leased by the five Lessees who, collectively, lease Portfolio Railcars having the greatest Aggregate Original Value, exceeds (y) 45% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date;  plus
     (v) the amount by which (x) the Aggregate Original Value of all Portfolio Railcars subject to one or more Leases to Lessees domiciled in Mexico exceeds (y) 10% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date;  plus
     (vi) for each single Lessee domiciled in Mexico whose unsecured, unsubordinated, non-credit enhanced long-term indebtedness for money borrowed in Dollars is rated at least BBB- by S&P, the amount by which (x) the Aggregate Original Value of all Portfolio Railcars subject to one or more Leases to such Lessee exceeds (y) 7.5% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date;  plus
     (vii) for each single Lessee domiciled in Mexico whose unsecured, unsubordinated, non-credit enhanced long-term indebtedness for money borrowed in Dollars is not rated by S&P or is rated below BBB- by S&P, the amount by which (x) the Aggregate Original Value of all Portfolio Railcars subject to one or more Leases to such Lessee exceeds (y) 5% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date;  plus
     (viii) the Aggregate Original Value of all Portfolio Railcars which are Ineligible Railcars; plus
     (ix) the amount by which (x) the Aggregate Original Value of all Portfolio Railcars that are subject to per diem leases exceeds (y) 7.5% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date;  plus
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     (x) the amount by which (x) the Aggregate Original Value of all Portfolio Railcars constituting Autoracks exceeds (y) 5% of the Aggregate Original Value of all Portfolio Railcars as of such Calculation Date.
     “Concentration Excess Event” means, as of any Calculation Date, that the “Concentration Excess Amount” is  greater  than zero on such Calculation Date.
     “Condemnation” means any taking of property or assets, or any part thereof or interest therein, for public or quasi-public use under the power of eminent domain, by reason of any public improvement or condemnation or in any other manner.
     “Condemnation Award” means all proceeds of any Condemnation or transfer in lieu thereof with respect to any Portfolio Railcar or other item of Collateral.
     “Conduit Lender” shall mean any Lender which is designated as a Conduit Lender pursuant to Section 11.06(g).
     “Contractual Obligation” means, as to any Person, any provision of any security issued by such Person or of any indenture, loan agreement, mortgage, deed of trust, contract or other agreement, instrument or undertaking to which such Person is a party or by which it or any of its property or assets is bound.
     “Corporate Base Rate” shall mean for any day, the higher of (i) the prime rate per annum announced from time to time by the Agent in effect on such day or (ii) the Federal Funds Rate plus one-half of one percent (0.50%). (The Corporate Base Rate is not intended to represent the lowest rate charged by any Lender for extensions of credit.)
     “Credit Exposure” means, for any Lender, the aggregate principal balance of the outstanding Loans held by such Lender on the applicable date of determination.
     “Credit Obligations” means, without duplication:
     (i) all principal of and interest (including, without limitation, any interest which accrues after the commencement of any bankruptcy or insolvency proceeding with respect to the Borrower, whether or not allowed or allowable as a claim under the Bankruptcy Code) on any Loan under, or any Note issued pursuant to, this Agreement or any other Loan Document;
     (ii) all fees, expenses, indemnification obligations and other amounts of whatever nature now or hereafter payable by the Borrower (including, without limitation, any amounts which accrue after the commencement of any bankruptcy or insolvency proceeding with respect to the Borrower, whether or not allowed or allowable as a claim under the Bankruptcy Code) pursuant to this Agreement or any other Loan Document;
     (iii) all expenses of the Agent and the Collateral Agent as to which the Agent or the Collateral Agent has a right to reimbursement under  Section 11.04  of this Agreement or under any other similar provision of any other Loan Document, including,
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without limitation, any and all sums advanced by the Collateral Agent to preserve the Collateral or preserve its security interests in the Collateral; and
     (iv) all amounts paid by any Indemnitee as to which such Indemnitee has the right to reimbursement under Section 11.05 of this Agreement or under any other similar provision of any other Loan Document;
together in each case with all renewals, modifications, consolidations or extensions thereof.
     “Creditor” means, without duplication, each Lender, each Derivatives Creditor, the Agent, the Collateral Agent, each Protected Party and each Indemnitee and their respective successors and assigns, and “ Creditors ” means any two or more of such Creditors.
     “Customer Collections Account Administration Agreement” means the Customer Collections Account Administration Agreement, dated as of November 12, 2003, among inter alios the Trinity Industries Leasing Company, Trinity Rail Leasing Trust II, Trinity Rail Leasing III, L.P., the TRL-III Transaction Investors identified on the signature pages thereto, Credit Suisse, New York Branch, Wilmington Trust Company, TRIP Rail Leasing LLC pursuant to a Supplemental Agreement thereto dated as of June 27, 2007 and the Borrower pursuant to a Supplemental Agreement thereto.
     “Customer Payments Account” means the Customer Payments Account referred to and defined in the Customer Collections Account Administration Agreement.
     “Debt” of any Person means at any date, without duplication, (i) all obligations of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person under conditional sale or other title retention agreements relating to property purchased by such Person to the extent of the value of such property (other than customary reservations or retentions of title under agreements with suppliers entered into in the ordinary course of business), (iv) all obligations of such Person to pay the deferred purchase price of property or services (other than current accounts payable arising in the ordinary course of business), (v) the capitalized amount of all Capital Leases of such Person that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, (vi) all obligations (other than obligations in respect of like kind exchanges) of such Person in respect of securities repurchase agreements or otherwise to purchase securities or other property which arise out of or in connection with the sale of the same or substantially similar securities or property, (vii) all non-contingent obligations (and, for purposes of  Section 7.01  and Section 9.01(f) , all contingent obligations) of such Person to reimburse any bank or other Person in respect of amounts paid under a letter of credit, bankers’ acceptance or similar instrument, (viii) all obligations of others secured by (or for which the holder of such obligations has an existing right, contingent or otherwise, to be secured by) a Lien on, or payable out of the proceeds of production from, any property or asset of such Person, whether or not such obligation is assumed by such Person; provided  that the amount of any Debt of others that constitutes Debt of such Person solely by reason of this  clause (viii)  shall not for purposes of this Agreement exceed the greater of the book value or the fair market value of the properties or assets subject to such Lien, (ix) all Guaranty Obligations of such Person, (x) all Disqualified Stock of such Person, (xi) all Derivatives Obligations of such Person and (xii) the
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Debt of any other Person (including any partnership in which such Person is a general partner and any unincorporated joint venture in which such Person is a joint venturer) to the extent such Person would be liable therefor under Applicable Law or any agreement or instrument by virtue of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Debt provide that such person shall not be liable therefor.
     “Default” means any condition or event which constitutes an Event of Default or which with the giving of notice or lapse of time or both would, unless cured or waived, become an Event of Default.
     “Default Margin” means 200 basis points per annum.
     “Depositary” means Wilmington Trust Company, or a successor thereto appointed pursuant to the Depository Agreement.
     “Depository Agreement” means a Depository Agreement, substantially in the form of Exhibit F hereto, with such changes thereto as may be reasonably acceptable to the Agent, among the Borrower, the Agent, the Collateral Agent and the Depositary.
     “Derivatives Agreement” means an ISDA interest rate swap or cap agreement, collar or other hedging instrument between the Borrower and the Derivatives Creditor named therein, each either (x) in form and substance reasonably acceptable to the Agent or (y) containing provisions of general application which are substantially the same as and not inconsistent with those contained in the Schedules and Confirmations entered into as part of the Derivatives Agreement in effect on the Closing Date, to which (i) the Borrower will receive payments from, or make payments to, the Derivatives Creditor based on the London Interbank Offered Rate and (ii) recourse by the Derivatives Creditor to the Borrower is limited to distributions of Available Collections and Net Cash Proceeds in accordance with the priority of payments set forth in  Section 2.07(c)(i) ,  Section 2.07(c)(ii) or  Section 2.07(c)(iii)  as applicable.
     “Derivatives Creditor” means any Person from time to time party to one or more Derivatives Agreements with the Borrower, and its successors and assigns, and “ Derivatives Creditors ” means any two or more of such Derivatives Creditors.
     “Derivatives Creditor Event” means (i) an Event of Default under a Derivatives Agreement with respect to which the related Derivatives Creditor is the sole Defaulting Party or (ii) a Termination Event under a Derivatives Agreement (other than an Illegality or Tax Event) with respect to which the related Derivatives Creditor is the sole Affected Party. The terms “Event of Default,” “Defaulting Party,” “Termination Event,” “Illegality,” “Tax Event,” and “Affected Party,” solely as used in this paragraph, shall have the meanings ascribed to such terms (or similar terms) in the applicable Derivatives Agreement.
     “Derivatives Obligations” of any Person means all obligations (including, without limitation, any amounts which accrue after the commencement of any bankruptcy or insolvency proceeding with respect to such Person, whether or not allowed or allowable as a claim under the Bankruptcy Code) of such Person in respect of any Derivatives Agreement, excluding any amounts which such Person is entitled to set-off against its obligations under Applicable Law.
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     “Derivatives Termination Value” means, at any date after the termination of any Derivatives Agreement, after taking into account the effect of any legally enforceable netting agreements relating to such Derivatives Agreement, the amount payable by (in which case the amount shall be positive) or payable to (in which case the amount shall be negative), the Borrower as a result of the termination of such Derivatives Agreement.
     “Disqualified Stock” of any Person means any Equity Interest of such Person which by its terms (or by the terms of any security for which it is convertible or for which it is exchangeable or exercisable), or upon the happening of any event or otherwise (including an event which would constitute a Change of Control), (A) matures or is mandatorily redeemable or subject to any mandatory repurchase requirement, pursuant to a sinking fund or otherwise, (B) is convertible into or exchangeable for Debt or Disqualified Stock or (C) is redeemable or subject to any repurchase requirement arising at the option of the holder thereof, in whole or in part.
     “Dollars” and the sign “$” means lawful money of the United States.
     “Effective Date” means the date this Agreement becomes effective in accordance with Section 11.21.
     “Eligible Assignee” means (i) any Lender, (ii) any Affiliate of a Lender, (iii) any Approved Fund, (iv) any bank or other financial institution (other than a Competitor of the Borrower) with a combined capital and surplus (or, if applicable, a consolidated net worth or its equivalent) of at least $200,000,000 and (v) any other Person (other than a natural Person) approved by the Agent and, provided no Default, Event of Default or Servicer Replacement Event has occurred and is continuing, the Borrower, such approval by the Borrower not to be unreasonably withheld.
     “Eligible Derivatives Creditor” means any of the following: (1) any bank which has both (x) a long-term unsecured debt rating of at least A- or better from S&P (so long as any outstanding Loans are rated by S&P) and (y) a short-term unsecured debt rating of A1 or better from S&P (so long as any outstanding Loans are rated by S&P); or (2) any bank or other financial institution (x) which is otherwise acceptable to the Agent and (y) for which the Rating Agency Condition has been satisfied.
     “Eligible Lease” means, as of the date such Lease is added to the Portfolio, a Lease:
     (i) in the form or substantially in the form of Exhibit I-1, Exhibit I-2, or Exhibit I-3 hereto or such other form as may have been approved by the Agent in its reasonable discretion;
     (ii) which constitutes an operating lease in accordance with GAAP;
     (iii) which is properly treated for United States federal income tax purposes, taking into account Applicable Law as of the date such Lease is added to the Portfolio, as a lease of a Railcar that does not convey ownership of such Railcar to the Lessee of such Lease for such income tax purposes;
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     (iv) which represents a transaction with respect to a related Railcar which is either (A) evidenced by a single lease agreement between the Borrower and the related Lessee governing only (y) the lease of such specific Railcar and (z) other identified Railcars which have been or will be transferred concurrently to the Borrower and are or will become Portfolio Railcars, or (B) evidenced by a specific schedule to a master lease agreement between the Borrower and related Lessee, which schedule identifies as the subject of (and sets forth the specific economic terms of) a lease transaction only as to (y) such specific Railcar and (z) other identified Railcars which have been or will be transferred concurrently to the Borrower and are or will become Portfolio Railcars (i.e., Railcars subject to the same single lease agreement or single schedule to a master lease agreement have not been and will not be transferred to the Borrower by virtue of separate or “split” transfers);
     (v) under which the Lessee is a Person (other than a natural Person) organized under the laws of the United States (or any state thereof or the District of Columbia), Mexico (or any state thereof) or Canada (or any province thereof) or otherwise approved in writing by the Agent with the consent of the Supermajority Lenders as evidenced by the approval of the related Funding Package;
     (vi) which provides for payment in Dollars;
     (vii) which materially complies with all Applicable Laws of the jurisdiction in which it was originated on the date such Lease is added to the Portfolio ;
     (viii) which represents the legal, valid and binding obligation of the Lessee thereunder, is enforceable against such Lessee in accordance with its terms (subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally and to general equitable principles) and was duly executed by parties having legal capacity to do so;
     (ix) which is not the subject of, and with respect to which there does not exist and are not overtly threatened, on the date such Lease is added to the Portfolio, any material actions, suits, investigations or legal, equitable or arbitrative or administrative proceedings against or adversely affecting any Facility Party;
     (x) which has not been satisfied, subordinated or rescinded and remains in full force and effect on the date such Lease is added to the Portfolio; and
     (xi) in respect of which the Security Agreement is effective to create a valid and perfected “first” priority Lien in favor of the Collateral Agent, subject only to Permitted Liens; and
     (xii) in the case of a Lease in the form or substantially in the form of Exhibit I-3, which provides that (a) notwithstanding Paragraph 3 of the form set forth on  Exhibit I-3  for such Lease, such Lease shall provide that Monthly Rent shall be payable to Trinity Leasing Customer Payment Account, Wilmington Trust Company, ABA # 031-100-092, Account # 001-2860-4998 or the Lessee shall otherwise be directed to pay Monthly Rent to such account, and (b) notwithstanding Paragraph 11 of the form set forth on  Exhibit I-3
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for such Lease, such Lease shall provide that the lessor under such Lease may assign such Lease without the prior written consent of the lessee (or the lessee thereunder shall have otherwise consented to the assignment of such Lease to the Borrower and to the Collateral Agent).
     “Eligible Railcar” means, on the date such Railcar is added to the Portfolio, a Railcar:
     (i) other than a Railcar which the Agent has determined and has previously notified the Borrower in writing is of a type which could, if included in the Portfolio, cause the Loans to receive a long term rating or a shadow rating of below “A-” from S&P;
     (ii) other than a Railcar which as of such date of determination is leased to a third party pursuant to a Lease which is not an Eligible Lease;
     (iii) in respect of which the Security Agreement is effective to create a valid and perfected “first” priority Lien in favor of the Collateral Agent, subject only to Permitted Liens; and
     (iv) other than a Railcar which as of such date of determination is not subject to an Eligible Lease.
     “Environmental Laws” means any current or future legal requirement of any Governmental Authority pertaining to (i) the protection of health, safety, and the environment, (ii) the conservation, management, damage to or use of natural resources and wildlife, (iii) the protection or use of surface water and groundwater or (iv) the management, manufacture, possession, presence, use, generation, transportation, treatment, storage, disposal, release, threatened release, abatement, removal, remediation or handling of, or exposure to, any hazardous or toxic substance or material and includes, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 USC 9601  et seq ., Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976 and Hazardous and Solid Waste Amendment of 1984, 42 USC 6901  et seq ., Federal Water Pollution Control Act, as amended by the Clean Water Act of 1977, 33 USC 1251  et seq ., Clean Air Act of 1966, as amended, 42 USC 7401  et seq ., Toxic Substances Control Act of 1976, 15 USC 2601  et seq ., Hazardous Materials Transportation Act, 49 USC App. 1801  et seq ., Occupational Safety and Health Act of 1970, as amended, 29 USC 651  et seq ., Oil Pollution Act of 1990, 33 USC 2701  et seq ., Emergency Planning and Community Right-to-Know Act of 1986, 42 USC 11001  et seq ., National Environmental Policy Act of 1969, 42 USC 4321  et seq ., Safe Drinking Water Act of 1974, as amended, 42 USC 300f  et seq ., any analogous implementing or successor law, any comparable state, local and regional laws, and any amendment, rule, regulation, order or directive issued thereunder.
     “Equity Equivalents” means with respect to any Person any rights, warrants, options, convertible securities, exchangeable securities, indebtedness or other rights, in each case exercisable for or convertible or exchangeable into, directly or indirectly, Equity Interests of such Person or securities exercisable for or convertible or exchangeable into Equity Interests of
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such Person, whether at the time of issuance or upon the passage of time or the occurrence of some future event.
     “Equity Interests” means all shares of capital stock, partnership interests (whether general or limited), limited liability company membership interests, beneficial interests in a trust and any other interest or participation that confers on a Person the right to receive a share of profits or losses, or distributions of assets, of an issuing Person, but excluding any debt securities convertible into such Equity Interests.
     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, or any successor statute, as interpreted by the rules and regulations thereunder, all as the same may be in effect from time to time. References to sections of ERISA shall be construed also to refer to any successor sections.
     “ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).
     “Eurodollar Reserve Percentage” means for any day that percentage (expressed as a decimal) which is in effect on such day, as prescribed by the Board of Governors of the Federal Reserve System (or any other entity succeeding to the functions currently performed thereby) for determining the maximum reserve requirement for a member bank of the Federal Reserve System in New York City with deposits exceeding five billion Dollars in respect of “Eurocurrency liabilities”, whether or not a Lender has any Eurocurrency liabilities subject to such reserve requirement at that time. Loans shall be deemed to constitute Eurocurrency liabilities and as such shall be deemed subject to reserve requirements without benefits of credits for prorations, exceptions or offsets that may be available from time to time to a Lender. The Adjusted Eurodollar Rate shall be adjusted automatically on and as of the effective date of any change in the Eurodollar Reserve Percentage.
     “Event of Default” has the meaning set forth in Section 9.01.
     “Event of Loss”, with respect to any Portfolio Railcar, means any of the following events:
     (a) during the term of any Lease with respect to such Railcar, such events with respect to such Railcar as are included in the definition of “Destroyed,” “Event of Loss,” “Total Loss,” or any equivalent term, as the case may be, in such Lease; and
     (b) when no Lease of such Railcar is in effect, any of the following events with respect to such Railcar:
     (i) loss of such Railcar or the use of such Railcar for a period in excess of 180 days due to destruction of or damage to such property or any other casualty which renders repair uneconomic or which renders such property permanently unfit for normal use;
15

 

     (ii) any damage to such Railcar which results in the receipt of Casualty Proceeds by the Agent or the Collateral Agent with respect to such Railcar on the basis of an actual, constructive or compromised total loss;
     (iii) the theft or disappearance of such Railcar for a period in excess of 180 consecutive days;
     (iv) the confiscation, seizure of or requisition or taking of title to or other Condemnation of such Railcar by any Governmental Authority other than an instrumentality or agency of the United States whose obligations bear the full faith and credit of the United States, for a period of more than 365 consecutive days; or
     (v) as a result of any law, rule, regulation, order or other action by the STB or other Governmental Authority having jurisdiction, use of such Railcar in the normal course of business of rail transportation is prohibited for a period of longer than 365 consecutive days.
provided that upon the earliest of (i) the date the Borrower or Servicer reasonably determines that no corresponding Lessee, insurance or other third party payment will be received in respect of such “Event of Loss”, (ii) the date that such payment is actually received (or, if directed by the Servicer to be deposited into the Substitution Account, the date that such payment, to the extent not used in a reinvestment, is released to the Collection Account) or (iii) the one-year anniversary of the date that the Borrower or Servicer has Knowledge that such “Event of Loss” has occurred, such Railcar shall be deemed to have suffered an “Event of Loss” and the Borrower or Servicer will identify and designate such Railcar as an “Event of Loss Unit” on the Monthly Report relating to the monthly period in which any of the foregoing occurs.
     “Excepted Payments” means “excepted payments” or “excluded payments” (as such terms or similar terms are defined and used in any Portfolio Lease) payable to or for the benefit of the Borrower, the Servicer, the Agent, the Collateral Agent, any Derivatives Creditor or any Lender (or any similar party as defined and used in such Lease), including, without limitation, (i) proceeds of public liability insurance (or other insurance maintained by or on behalf of the Borrower for its own account) payable to or for the benefit of the Borrower or the Lessee (or governmental indemnities in lieu thereof), (ii) any indemnity payments or similar obligations to the extent such amounts are payable to or for the benefit any Person other than the Borrower and (iii) any rights to enforce and collect the same, but in all cases excluding, without limitation, any indemnity payments or similar obligations not otherwise excluded from the “Collateral” under the Security Agreement.
     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
     “Expected Maturity Date” means the seventh (7th) anniversary of the Closing Date.
     “Facility Party” means each of the Servicer and the Borrower, and “Facility Parties” means all of the foregoing.
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     “Federal Funds Rate” means for any day the rate per annum (rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day;  provided  that (i) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate quoted to the Agent, on such day on such transactions as determined by the Agent.
     “Financing Notice” means a notice in substantially the form of Exhibit A-4 hereto, with appropriate insertions.
     “Follow-On Lease” has the meaning set forth in Section 6.13.
     “FRA” means the Federal Railroad Administration Rules and Regulations, as such regulations are amended from time to time, or corresponding provisions of future regulations.
     “Funding Losses” has the meaning set forth in Section 3.04.
     “Funding Package” means with respect to each Railcar:
     (i) a copy of all related Leases;
     (ii) for each Railcar to be purchased by the Borrower a current (within sixty (60) days) Independent Appraisal;
     (iii) the following information:
     (A) the Manufacturer, type, model and car number;
     (B) the Mark that is, or after acquisition by the Borrower will be, applicable to such Railcar and the identity of the registered holder of such Mark;
     (C) the Lessee or proposed Lessee, if applicable;
     (D) the Seller of the Railcar;
     (E) the proposed Purchase Price and information on any material modifications (including, but not limited to, prospective material modifications) to the Railcar that relate to such Purchase Price;
     (F) the terms of the Lease or proposed Lease, if any, with respect to such Railcar, including, without limitation, the terms, Monthly Rent and Security Deposits (if any), return conditions and non-confidential information showing the basis for TILC’s decision to enter into the applicable Lease;
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     (G) search reports (or oral confirmation thereof) as of a recent date from all public offices (including, without limitation, the STB and the Office of the Registrar General of Canada) in which a filing or recording is required or would be effective to perfect a Lien on the interests of the Borrower or the applicable Seller in such Railcar and any related Lease; and
     (H) if such Railcar is then subject to a Lien of record of any Person, information regarding all such Liens including, but not limited to, (A) the name of such lienholder, (B) a description of the collateral granted to such lienholder to secure each such Lien and (C) the payoff amount required to satisfy each such Lien; and
     (iv) a memorandum addressed to the Agent and each Lender describing all material differences, if any, between any related Lease and the applicable form of Lease attached hereto as  Exhibit I-1, I-2  or  I-3 .
provided that to the extent one or more Lease Documents relating to a Railcar that is or is intended to be subject to a Lease that will become a Portfolio Lease on the Closing Date has not been executed at the time such Funding Package is delivered to the Agent, drafts of such documents may be included in such Funding Package, and  provided ,  further , that if drafts of the foregoing are submitted, final versions of such documents must be received by the Agent at least three days prior to the Closing Date.
     “GAAP” means at any time generally accepted accounting principles as then in effect in the United States, applied on a basis consistent (except for changes with which TILC’s independent public accountants have concurred) with the financial statements of TILC delivered to the Lenders on the Closing Date pursuant to  Section 5.05(a) .
     “Governmental Authority” means any federal, state, local, provincial or foreign government, authority, agency, central bank, quasi-governmental or regulatory authority, court or other body or entity, and any arbitrator with authority to bind a party at law.
     “Granting Lender” has the meaning set forth in Section 11.06(g).
     “Guaranty Obligation” means, with respect to any Person, without duplication, any obligation (other than endorsements in the ordinary course of business of negotiable instruments for deposit or collection) guarantying, intended to guaranty, or having the economic effect of guarantying, any Debt of any other Person in any manner, whether direct or indirect, and including without limitation any obligation, whether or not contingent, (i) to purchase any such Debt or other obligation or any property constituting security therefor, (ii) to advance or provide funds or other support for the payment or purchase of such indebtedness or obligation or to maintain working capital, solvency or other balance sheet condition of such other Person (including, without limitation, maintenance agreements, comfort letters, take or pay arrangements, put agreements or similar agreements or arrangements) for the benefit of the holder of Debt of such other Person, (iii) to lease or purchase property, securities or services primarily for the purpose of assuring the owner of such Debt or (iv) to otherwise assure or hold harmless the owner of such Debt or obligation against loss in respect thereof. The amount of any
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Guaranty Obligation hereunder shall (subject to any limitations set forth therein) be deemed to be an amount equal to the outstanding principal amount (or maximum principal amount, if larger) of the Debt in respect of which such Guaranty Obligation is made.
     “Illegality Event” has the meaning set forth in Section 3.02.
     “Increased Cost” has the meaning set forth in Section 3.03(a).
     “Indemnified Liabilities” has the meaning set forth in Section 11.05.
     “Indemnitee” has the meaning set forth in Section 11.05.
     “Independent Appraisal” means a document executed by an Independent Appraiser setting forth the Appraised Fair Market Value of the Railcar or other item of equipment being appraised and the data and explanation, all in reasonable detail, supporting such Appraised Fair Market Value.
     “Independent Appraiser” means Rail Solutions, Inc., or, in substitution of any of the foregoing appraiser, any independent railcar appraisal expert of recognized standing selected by the Agent in consultation with, and satisfactory to, the Borrower;  provided  that no such consultations with, or satisfaction of, the Borrower shall be required so long as a Default, a Servicer Replacement Event or an Event of Default shall have occurred and be continuing.
     “Ineligible Railcars” means all Portfolio Railcars which were not Eligible Railcars as of the date such Railcars were added to the Portfolio.
     “Initial Principal Amount” means $572,204,148.
     “Insolvency Event” means any condition or event set forth in Section 9.01(g).
     “Insurance Management Agreement” means the Insurance Management Agreement, substantially in the form of Exhibit H  hereto, dated as of the date hereof between the Borrower and the Servicer.
     “Interchange Rules” means the interchange rules and supplements thereto promulgated by the A.A.R., as in effect from time to time.
     “Interest Period” means, with respect to each Loan made pursuant to this Agreement (i) initially, (a) the period commencing on and including the Prefunding Date and ending on but including the next succeeding Settlement Date thereafter or (b) at the election of the Borrower (in the event the Prefunding Date occurs during the period from and including five (5) Business Days prior to a Settlement Date to but excluding such Settlement Date), the period commencing on and including the Prefunding Date related to such Loan and ending on the second succeeding Settlement Date thereafter, and (ii) thereafter, the period from and including the last day of the immediately preceding Interest Period to, but including, the next succeeding Settlement Date.
     “Investment” in any Person means (i) the acquisition (whether for cash, property, services, assumption of Debt, securities or otherwise) of assets, Equity Interests, bonds, notes,
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debentures, time deposits or other securities of such other Person, (ii) any deposit with, or advance, loan or other extension of credit to or for the benefit of such Person (other than deposits made in connection with the purchase of equipment or inventory in the ordinary course of business) or (iii) any other capital contribution to or investment in such Person, including by way of Guaranty Obligations of any obligation of such Person, any support for a letter of credit issued on behalf of such Person incurred for the benefit of such Person or any release, cancellation, compromise or forgiveness in whole or in part of any Debt owing by such Person.
     “Knowledge” means (i) an individual will be considered to have “Knowledge” of a fact or matter if the individual is actually aware of the fact or matter; and (ii) an entity will be considered to have “Knowledge” of a fact or matter if any individual who is serving as a director, manager or senior executive officer of that entity is, or was at any time while serving in such official capacity, actually aware of the fact or matter.
     “Lease” means, with respect to any Railcar, (i) any lease entered into by the Borrower, as lessor, and any and all supplements and amendments related thereto or (ii) any such lease transferred to the Borrower pursuant to a Sale Agreement. Any specified schedule to a master lease agreement identifying Railcar(s) thereto shall be considered to be a separate “Lease.”
     “Lease Default” means the occurrence of any default (other than a default which has been waived in compliance with  Section 7.14 , excluding the proviso therein) under a Lease which is not or has not become, through the giving of notice and/or passage of time or otherwise, a Lease Event of Default.
     “Lease Documents” means (i) each of the Leases and Sale Agreements and (ii) each other document, certificate or opinion delivered or caused to be delivered to or for the benefit of the Borrower pursuant thereto.
     “Lease Event of Default” means any default (other than a default which has been waived with the specific written consent of the Agent under  Section 7.14 , excluding the proviso thereof) under a Lease which, through the giving of notice, the passage of time or otherwise, has become an “event of default” or similar term (as defined and used in such Lease) thereunder, it being the intention that a Lease Event of Default shall mean a default under a Lease as to which the cure period, if any, has expired or which has no cure period.
     “Lease Required Modification” has the meaning set forth in Section 6.08(b).
     “Legal Final Maturity Date” means the thirtieth (30th) anniversary of the Closing Date.
     “Lender” means any Person listed on Schedule 1.01 and shown as having a Commitment as of the Effective Date and any Person that has advanced a Loan (including any Conduit Lender that provides a Loan pursuant to Section 11.06(g) ), or an Eligible Assignee which thereafter acquires a Loan and Note (if any) hereunder in accordance with Section 11.06(b)  or  11.06(g)  and their respective successors.
     “Lessee” means any lessee under any Lease.
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     “Lien” means, with respect to any asset, any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of any financing statement or memorandum of lien under the Uniform Commercial Code or comparable laws of any jurisdiction), including the interest of a purchaser of accounts receivable, chattel paper, payment intangibles or promissory notes.
     “Liquidity Reserve Account” means the Liquidity Reserve Account established by the Depositary pursuant to the Depository Agreement.
     “Liquidity Reserve Target Amount,” means, with respect to any Settlement Date, an amount equal to the product of (x) six (6), times (y) the  sum  of (i) interest payable on the then outstanding principal amount of the Loan on such Settlement Date (for purposes of this calculation, interest shall be calculated assuming 30 days in the related accrual period),  plus  (or  minus) (ii) the net payments owed by the Borrower (or owed to the Borrower) under any Derivatives Obligations (other than for the payment of Derivatives Termination Value) in respect to the Interest Period ending on such Settlement Date (for purposes of this calculation, such payments shall be calculated assuming 30 days in the related accrual period for both payments payable and receivable).
     “Liquidity Reserves” means amounts deposited in the Liquidity Reserve Account.
     “Loan Documents” means this Agreement, the Notes and the Collateral Documents, collectively, and all other related agreements and documents issued or delivered hereunder or thereunder or pursuant hereto or thereto, in each case as the same may be amended, modified or supplemented from time to time.
     “Loan” has the meaning set forth in Section 2.01.
     “London Interbank Offered Rate” means, for any Interest Period:
     (i) the rate per annum equal to the rate determined by the Agent to be the offered rate that appears on the page of the Reuters screen (or any successor thereto) that displays an average British Bankers Association Interest Settlement Rate for one-month deposits in Dollars (for delivery on the first day of such Interest Period), determined as of approximately 11:00 A.M. (London time) two Business Days prior to the first day of such Interest Period; or
     (ii) if the rate referred to in clause (i) above does not appear on such Reuters page or service or such page or service shall cease to be available, the rate per annum equal to the rate determined by the Agent to be the offered rate that appears on such other page or service that displays an average British Bankers Association Interest Settlement Rate for one-month deposits in Dollars (for delivery on the first day of such Interest Period), determined as of approximately 11:00 A.M. two Business Days prior to the first day of such Interest Period; or
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     (iii) if the rates referenced in the preceding clauses (i) and (ii) are not available, the rate per annum determined by the Agent as the rate of interest (rounded upwards to the next 1/16th of 1%) at which one-month deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Loans held by the Agent, as would be offered by the principal London Office of the Agent to major banks in the offshore Dollar market at their request at approximately 11:00 A.M. (London time) two Business Days prior to the first day of such Interest Period; or
     (iv) the rates referenced in the preceding clauses (i), (ii) and (iii) are not available or are not established for any reason for any Interest Period, the “London Interbank Offered Rate” shall equal the Corporate Base Rate for each day during such Interest Period.
     “Maintenance Reserve Account” means the Maintenance Reserve Account established by the Depositary pursuant to the Depository Agreement.
     “Manufacturer” means the relevant manufacturer of each Railcar.
     “Margin Stock” means “margin stock” as such term is defined in Regulation U.
     “Marks” means identification marks of Railcars.
     “Marks Company” means Trinity Marks Company, a Delaware statutory trust, and its successors.
     “Marks Company Delaware Trustee” means Wilmington Trust Company, in its capacity as Delaware trustee for the Marks Company, and its successor or successors in such capacity.
     “Marks Company Interests” means all beneficial interests, including, without limitation all special units of beneficial interests, now or hereafter issued to or for the benefit of the Borrower representing the right of the Borrower to receive payments of all Railroad Mileage Credits received by the Marks Company in respect of Portfolio Railcars.
     “Marks Company Servicing Agreement” means the Management and Servicing Agreement dated as of May 17, 2001 between TILC and the Marks Company, as amended by the First Amendment to the Management and Servicing Agreement, dated as of December 28, 2001, between TILC and the Marks Company.
     “Marks Company Trust Agreement” means the Amended and Restated Marks Company Trust Agreement dated as of May 17, 2001 between TILC, as Settlor, UTI Trustee and Initial Beneficiary, and the Marks Company Delaware Trustee.
     “Material Adverse Effect” means (i) any material adverse effect upon the operations, business, properties or condition (financial or otherwise) of the Borrower (after taking into account any applicable insurance and any applicable indemnification (to the extent the provider of such insurance or indemnification has the financial ability to support its obligations with respect thereto and is not disputing or refusing to acknowledge the same), (ii) a material adverse effect on the ability of the Borrower to consummate the transactions contemplated hereby to
22

 

occur on the Closing Date, (iii) a material impairment of the ability of the Borrower to perform any of its obligations under any Transaction Document or (iv) a material impairment of the rights and benefits of the Lenders under any Loan Document.
     “Measuring Period”, as determined with respect to any Settlement Date, means the period from the second preceding Calculation Date to the then most recent Calculation Date.
     “Modifications and Improvements Accounts” means the Modifications and Improvements Account established by the Depositary pursuant to the Depository Agreement.
     “Monthly Depreciation” means with respect to any Measuring Period and with respect to any Portfolio Railcar, the aggregate depreciation expense of the Borrower for such Measuring Period in respect of such Portfolio Railcar, calculated for such Railcar based upon the Original Value of such Railcar, using the straight-line method of depreciation and assuming a 10% residual value and a useful life of 35 years (25 years in the case of Autoracks) from the date of manufacture.
     “Monthly Rent” means the aggregate amount of scheduled monthly (or quarterly) rent payments actually paid by each Lessee under the applicable Lease  plus  the aggregate amount (if any) applied from Security Deposits to cover such rent payments;  provided  that if any Lease requires scheduled payments of rent other than on a monthly basis, an amount of such rent shall be allocated to each month on a pro rata basis for the purpose of determining the aggregate amount of “Monthly Rent.”
     “Monthly Report” means a report by the Servicer in substantially the form of Exhibit A-5 hereto or such other form as may hereafter be agreed by the Servicer and the Agent, with appropriate insertions, or with such other changes as may be reasonably agreed to by the Agent.
     “Monthly Utilization Event” means, on any Calculation Date, the Aggregate Original Value of all Portfolio Railcars subject to Eligible Leases as of the date of the then most recent Monthly Report is less than the  product  of (x) 95% (expressed as a decimal)  times  (y) the Aggregate Original Value of all Portfolio Railcars as of the date of such Monthly Report.
     “Moody’s” means Moody’s Investors Service, Inc., a Delaware corporation, and its successors or, absent any such successor, such nationally recognized statistical rating organization as the Borrower and the Agent may select.
     “Net Cash Proceeds” means:
     (i) with respect to any Asset Disposition (other than pursuant to a Securitization), (A) the gross amount of cash proceeds (including the proceeds of any Condemnation Awards, Event of Loss or Condemnation but not including Casualty Proceeds (but including proceeds from a sale of a Railcar subject to a Casualty)) actually paid to or actually received by the Borrower in respect of such Asset Disposition (including any cash proceeds received as income or other proceeds of any noncash proceeds of any Asset Disposition as and when received),  less  (B) the  sum  of (x) the amount, if any, of all taxes (other than income taxes) (to the extent that the amount of such taxes shall have been set aside for the purpose of paying such taxes when due), and
23

 

customary fees, brokerage fees, commissions, costs and other expenses (excluding all such fees, brokerage fees, commissions, costs and other expenses payable to any Affiliates of the Borrower other than as reimbursement for such amounts incurred for the benefit of the Borrower and paid by such Affiliates to unrelated third parties on behalf of the Borrower) that are incurred in connection with such Asset Disposition and are payable by the Borrower, but only to the extent not already deducted in arriving at the amount referred to in  clause (i)(A)  above,  plus  (y) appropriate amounts that must be set aside as a reserve in accordance with GAAP against any liabilities associated with such Asset Disposition; and
     (ii) with respect to any Securitization, the gross amount of cash proceeds paid to or received by the Borrower in respect of the closing of such Securitization, net of underwriting discounts and commissions or placement fees, investment banking fees, legal fees, consulting fees, accounting fees and other customary fees and expenses directly incurred by the Borrower in connection therewith (other than those payable to any Affiliate of the Borrower).
     “Net Cash Proceeds Account” means the “Net Cash Proceeds Account” established by the Depositary pursuant to the Depository Agreement.
     “Non-U.S. Lender” has the meaning set forth in Section 3.01(d).
     “Note” and “Notes” means, a promissory note, substantially in the form of Exhibit B hereto, evidencing the obligation of the Borrower to repay outstanding Loans, as such note may be amended, modified, supplemented, extended, renewed or replaced from time to time.
     “Notice of Borrowing” means a request by the Borrower for a Borrowing, substantially in the form of Exhibit A-2  hereto.
     “Obligations” means, at any date, (i) all Credit Obligations and (ii) all Derivatives Obligations of the Borrower owed or owing to any Derivatives Creditor.
     “One Month Interest Coverage Ratio” means, with respect to any Settlement Date (commencing on the Settlement Date occurring in July, 2008), the ratio of (i) the  sum  of (A) the aggregate amount of Monthly Rent actually collected and paid into the Collection Account (including amounts used from any Security Deposits to cover Monthly Rent),  plus  (B) payments of Railroad Mileage Credits to the Borrower,  plus  (C) interest earned under deposits in the Accounts,  plus  (D) the aggregate amount of any Servicer Advances,  minus  (E) Borrower obligations and expenses (including Operating Expenses, the cost of replacement Parts and Servicer’s Fees, but excluding interest expense accrued and principal payable on the Loans) that are then due or that have become due, in each case with respect to the most recent Measuring Period ended on or prior to the Calculation Date immediately preceding such Settlement Date, to (ii) the  sum  of (A) the amount of interest expense accrued on the Loans,  minus  (B) any amounts (other than any Derivatives Termination Value) owed to the Borrower as of such Settlement Date under any Derivatives Agreements,  plus  (C) any amounts (other than any Derivatives Termination Value) owed by the Borrower as of such Settlement Date under any Derivatives
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Agreements, in each case with respect to the most recent Measuring Period ended on or prior to the Calculation Date immediately preceding such Settlement Date.
     “Operating Expenses” means (a) with respect to the Portfolio, (i) storage, maintenance, test runs, repossession (whether or not successful), reconfiguration, refurbishment, repair expenses, shipping fuel, upgrade and integration expenses related to the Railcars, incurred by the Borrower or the Servicer (in its capacity as Servicer under the Servicing Documents), including all expenses relating to compliance with Interchange Rules and including the fees and expenses of independent technicians and other experts retained for any of the foregoing purposes other than with respect to expenditures specifically agreed to be borne by the Servicer; (ii) insurance expenses related to the Portfolio Railcars, including all fees and expenses of insurance advisors and brokers; (iii) fees and expenses of independent advisors; (iv) outside legal counsel fees and expenses and other professional fees and expenses (A) related to litigation concerning any Railcar, (B) related to negotiations, documentation, legal opinions and other legal assistance normally requested by a lessor in connection with leasing a Railcar, (C) related to any actual or proposed amendment, workout, forbearance, repossession, foreclosure or other remedial action relating to any Railcar or (D) related to out of the ordinary course of business situations; (v) all amounts (including indemnities) payable by the Borrower pursuant to any Lease or termination thereof, or amounts payable by the Borrower pursuant to the sale of a Railcar; (vi) sales, use, property and other taxes (including any of those which may have been paid by Servicer on behalf of any of the Borrower) payable in connection with the sale or lease of any Portfolio Railcar by or on behalf of the Borrower or otherwise payable by the Borrower, but excluding any sales, use, property or other taxes payable by the Seller under the Purchase and Sale Agreement; (vii) remarketing expenses and broker fees in connection with the actual or potential sale or lease of any Railcar, (viii) additional delivery expenses for any Railcar, to the extent that the actual delivery expenses for such Railcar exceed the estimated delivery expense amount included in the Purchase Price paid for any Railcar (to the extent that the estimated delivery expense amount included in the Purchase Price for any Railcar exceeds the actual delivery expense amount for such Railcar, such excess amount shall be deducted from the total “Operating Expenses”) and (ix) Required Modifications and (b) all other fees, costs and operating expenses of the Borrower including all day-to-day expenses and all capital costs; provided, however, any amounts applied (or that would be applied) under  Section 2.07(c)  (disregarding any amounts applied (or that would be applied) to the Operating Expenses Account thereunder) shall not be included in “Operating Expenses.”
     “Operating Expenses Account” means the “Operating Expenses Account” established by the Depository pursuant to the Depository Agreement.
     “Optional Modification” has the meaning set forth in Section 6.08(d).
     “Optional Prepayment Amount” means the product of (x) the aggregate amount of Loans to be prepaid pursuant to  Section 2.07(a)  and/or  Section 2.07(b)  on a particular date,  multiplied  by (y) the applicable Optional Prepayment Percentage (expressed as a decimal).
     “Optional Prepayment Percentage” means, with respect to Loans to be prepaid pursuant to Section 2.07(a) and/or Section 2.07(b)  on a particular date, the percentage set forth opposite the period in which such date occurs in the table set forth below:
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	Period
	 
	Optional Prepayment Percentage

	Closing Date through (and including) May 16, 2009:
	 
	 
	101.00
	%

	May 17, 2009 through (and including) May 16, 2010:
	100.50
	%

	May 17, 2010 through (and including) May 16, 2011:
	 
	 
	100.25
	%

	May 17, 2011 and thereafter:
	 
	 
	100.00
	%

Provided, however, that no prepayment premium will be payable (but Funding Losses will be payable, if applicable) in respect of prepayments attributable to proceeds received by the Borrower from a Casualty or Event of Loss;  provided ,  further , that no prepayment premium will be payable (but Funding Losses will be payable, if applicable) in respect of prepayments attributable to proceeds received by the Borrower from Permitted Discretionary Sales to the extent such prepayments do not cumulatively exceed 10% of the Aggregate Original Value of all Railcars in the Portfolio on the Closing Date.
     “Optional Prepayment Premium” means, with respect to Loans to be prepaid pursuant to Section 2.07(a) and/or Section 2.07(b)  on a particular date, the  difference , if any of (x) the Optional Prepayment Amount,  minus  (y) the aggregate amount of Loans to be prepaid pursuant to  Section 2.07(a)  and/or  Section 2.07(b)  on such date.
     “Original Value” means,
     (i) with respect to any Railcar (other than a Replacement Railcar) at any time, the Purchase Price for such Railcar; and
     (ii) with respect to any Replacement Railcar at any time, the Original Value of the Relinquished Railcar so replaced; provided ,  however , that the Original Value of a Replacement Railcar purchased by the Borrower in connection with a single transaction or a series of related transactions involving the purchase and sale of multiple Replacement Railcars and Relinquished Railcars shall be equal to the  product  of (x) the  sum  of the Original Values of all such Relinquished Railcars, multiplied  by (y) a fraction, the numerator of which is the current (within 60 days) Appraised Fair Market Value of such Replacement Railcar and the denominator of which is the sum of the current (within 60 days) Appraised Fair Market Values of all such Replacement Railcars.
Provided, however, (a) on and after an Event of Loss with respect to a Railcar, its Original Value will be deemed to be zero and (b) on and after the 90 th  day after the date in which the Servicer or the Borrower first has Knowledge of a Casualty with respect to a Railcar, its Original Value will either be deemed to be zero unless prior to such 90 th  day the Borrower has restored the Railcar either (i) to its previous utility and economic useful
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life or (ii) to qualify for use in interchange in accordance with the Interchange Rules (provided, for purposes of this clause (ii) , that the Lessee under the applicable Lease for such Railcar has no right to abate monthly rent at such time).
     “Organization Documents” means: (i) with respect to any corporation, the certificate or articles of incorporation and the bylaws; (ii) with respect to any limited liability company, the certificate of formation (or articles of organization, as the case may be) and operating agreement; and (iii) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation with the secretary of state or other department in the state or other jurisdiction of its formation, in each case as amended from time to time.
     “Other Taxes” has the meaning set forth in Section 3.01(b).
     “Parent Security Agreement” means the Parent Security Agreement, dated as of the date hereof, between TILC, the Collateral Agent and the Agent.
     “Part” or “Parts” means all appliances, parts, instruments, appurtenances, accessories, furnishings and other equipment of whatever nature, which may from time to time be installed on, incorporated in or attached to, a Railcar and, so long as such items remain subject to this Agreement, all such items which are subsequently removed therefrom and which are owned by the Borrower.
     “Payment Notice/Lessor Rights Notice” has the meaning set forth in the Form of Payment Notice/Lessor Rights Notice in the form of  Exhibit E-2  hereto.
     “Pension Plan” means an “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes or has an obligation to contribute.
     “Perfection Certificate” means a certificate, substantially in the form of Exhibit E-1 to this Agreement, completed and supplemented with the schedules and attachments contemplated thereby to the satisfaction of the Agent and duly executed by a Responsible Officer of each of the Servicer and the Borrower.
     “Performance Guaranty” means the Performance Guaranty, substantially in the form of Exhibit M hereto, dated as of the Closing Date between Trinity, the Collateral Agent and the Agent.
     “Permit” means any license, permit, franchise, right or privilege, certificate of authority or order, or any waiver of the foregoing, issued or issuable by any Governmental Authority.
     “Permitted Discretionary Sale” means a sale or exchange of a Railcar (including a sale to a Lessee pursuant to a Lessee purchase option in the applicable Lease) in which:
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     (i) at the time of such sale or exchange, no Event of Default or Amortization Event has occurred and is continuing (unless this  clause (i)  is waived by the Supermajority Lenders);  provided ,  however , the Borrower may continue to undertake sales of Railcars to Lessees pursuant to a Lessee purchase option in the applicable Lease,
     (ii) the Replacement Railcar (if any) is a Qualifying Replacement Railcar,
     (iii) the Net Cash Proceeds with respect to any such sale (other than a sale to a Lessee pursuant to a Lessee purchase option in the applicable Lease) are equal to or greater than 105% of the  sum  of (x) the Allocable Debt in respect of such Relinquished Railcar immediately prior to such sale,  plus  (y) unless the Borrower intends to use the proceeds of such sale to acquire Qualifying Replacement Railcars, any Derivatives Termination Value payable in connection with or resulting from such sale,  plus  (z) any Optional Prepayment Premium payable if the proceeds of such sale are used to prepay the Loans in whole or in part,
     (iv) after giving effect to the reinvestment of Net Cash Proceeds in one or more Replacement Railcars, if any, will not cause a Concentration Excess Event,
     (v) the Appraised Fair Market Value (within sixty (60) days of acquisition by the Borrower) of the Replacement Railcar (if any) must at least equal the Adjusted Collateral Value of the Relinquished Railcar at its time of sale or exchange (except to a de minimis extent),
     (vi) the aggregate sum of the Original Values of all Railcars that the Borrower sells or exchanges in all sales or exchanges of Railcars (including sales pursuant to a Lessee purchase option) from the Closing Date until (and including) the Expected Maturity Date, does not exceed 30% of the Aggregate Original Value of all the Railcars in the Portfolio as of the Closing Date,
     (vii) the aggregate sum of the Original Values of all Railcars that the Borrower sells or exchanges in all sales or exchanges of Railcars (including sales pursuant to a Lessee purchase option) from the Closing Date until (and including) the Expected Maturity Date in order to purchase Replacement Railcars, does not exceed 20% of the Aggregate Original Value of all the Railcars in the Portfolio as of the Closing Date, and
     (viii) the consideration therefor is either (a) in the case of a sale of a Railcar, cash or Cash Equivalents or (b) in the case of an exchange of a Railcar, Qualifying Replacement Railcars;
provided, however, (a) the Borrower may undertake sales or exchanges of Railcars at any time and in any manner in the event the Supermajority Lenders waive the foregoing conditions or at the direction of the Collateral Agent (excluding the 20% limit described in  clause (vii)  above, which cannot be waived), (b) the Borrower may undertake sales or exchanges of Railcars subject to a Casualty (in the event the Borrower or Servicer determines that repairs to such Railcar subject to a Casualty are economically impractical) or an Event of Loss (in any case of Event of Loss) for salvage or other obtainable value, “free and clear” of the Collateral Agent’s security interests and (c)
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notwithstanding the foregoing conditions, the Borrower may undertake a sale of all or substantially all of the Railcars in the Portfolio in connection with a prepayment of the Loans in full.
     “Permitted Liens” means with respect to any Portfolio Railcar: (i) the Liens granted by the Borrower to the Collateral Agent under the Loan Documents; (ii) the respective rights of a Lessee under the Lease with respect to such Railcar; (iii) Liens for Taxes payable by the Borrower either not yet due or being contested in good faith by appropriate proceedings diligently conducted so long as such proceedings do not involve any imminent danger of the sale, forfeiture or loss of such Railcar or any interest therein; (iv) materialmen’s, suppliers’, mechanics’, workmen’s, repairmen’s, employees’ or other like Liens arising in the ordinary course of business for amounts the payment of which is either not yet delinquent or is being contested in good faith by appropriate proceedings diligently conducted so long as such proceedings do not involve any imminent danger of the sale, forfeiture or loss of such Railcar or any interest therein; (v) Liens arising out of judgments or awards against the Borrower that do not give rise to any Default or Event of Default and with respect to which there shall have been secured a stay of execution pending appeal or review; and (vi) customary salvage and similar rights of insurers under policies of insurance maintained with respect to the Collateral.
     “Person” means an individual, a corporation, a partnership, an association, a limited liability company, a trust or an unincorporated association or any other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.
     “Physical Inspection Report” means with respect to each Railcar, a physical inspection report of an independent inspector mutually acceptable to the Borrower and the Agent, which report shall set forth, among other things, the total number of hours and miles with respect to such Railcar.
     “Portfolio” means, collectively, all of the Portfolio Railcars and the Portfolio Leases.
     “Portfolio Lease” means a Lease with respect to a Portfolio Railcar.
     “Portfolio Railcars” means a Railcar which is owned by the Borrower and which has been funded in whole or in part by Loans hereunder or included as a Replacement Railcar or otherwise added to the Portfolio in accordance with Sections 2.02(a)  and  (b) .
     “Prefunding Account” means the “Prefunding Account” established by the Depositary pursuant to the Depository Agreement.
     “Prefunding Date” has the meaning set forth in Section 2.03(b).
     “Prepayment Amount” means,
     (i) upon the occurrence and during the continuation of an Amortization Event, Insolvency Event, Default or Facility Event of Default, an amount equal to all Net Cash Proceeds (or if all such Amortization Events, Defaults or Facility Events of Default can be cured with the payment of money, such amount as required to cure each such Amortization Event, Default and Facility Event of Default) from sales of Railcars and all
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insurance and all other proceeds received with respect to any Event of Loss of Railcars, and
     (ii) at any other time, the amount necessary to reduce the outstanding principal amount of the Loans to the Scheduled Targeted Principal Balance (after giving effect to the sale of any Railcars);
provided that if the payment of such amount together with any related Event of Loss would result in a Facility Event of Default or an Amortization Event, such Prepayment Amount shall be increased to the extent required to prevent such Facility Event of Default or Amortization Event from occurring.
     “Principal Payment Deficiency” means, on any Settlement Date, the excess (if any) of (x) the outstanding principal balance of the Loans,  over  (y) the  lesser  of (i) the Scheduled Targeted Principal Balance applicable to such Settlement Date and (ii) the then most recent Appraised Fair Market Value of all Portfolio Railcars resulting from an Independent Appraisal conducted pursuant to  Section 6.11(b)(i) ,  Section 6.11(b)(ii) , or  Section 6.11(b)(iii) .
     “Principal Payment Deficiency Event” means, on any Calculation Date, the Principal Payment Deficiency (if any) determined as of the Settlement Date immediately preceding such Calculation Date (or, if such Calculation Date is a Settlement Date, such Settlement Date) is greater than the  product  of (x) 5% (expressed as a decimal)  times  (y) the  lesser  of (i) the Scheduled Targeted Principal Balance applicable to such Settlement Date and (ii) the then most recent Appraised Fair Market Value of all Portfolio Railcars resulting from an Independent Appraisal conducted pursuant to  Section 6.11(b)(i) ,  Section 6.11(b)(ii) , or  Section 6.11(b)(iii) ;  provided ,  however , in the event the amount in  clause (ii)  in this paragraph is less than the amount in  clause (i)  of this paragraph, then the “Principal Payment Deficiency Event” shall occur on the first Settlement Date which occurs more than 10 calendar days following the date in which such Independent Appraisal described in clause (ii)  of this paragraph is delivered to the Agent.
     “Protected Party” means, without duplication, the Agent, the Collateral Agent, the Servicer, the Depositary, each Creditor, each Support Party and any participant, successor or permitted assign of any thereof.
     “Purchase and Sale Agreement” means either or both (as the context may require) of (i) the Purchase and Sale Agreement, substantially in the form of  Exhibit J-1  hereto, between TILC and the Borrower and (ii) the Purchase and Sale Agreement, substantially in the form of  Exhibit J-2  hereto, between Trinity Rail Leasing Trust II and the Borrower.
     “Purchase Price” with respect to any Railcar, means the fair market value of such Railcar determined by an Independent Appraiser on the basis of a current (within sixty (60) days of the Closing Date) “desktop appraisal.”
     “Qualifying Replacement Railcar” means a Railcar or Railcars (in the aggregate) (A) having a utility and remaining economic useful life comparable to the Railcar being replaced (assuming that such Railcar had been maintained in accordance with this Agreement), (B) must be under Lease (1) with a remaining lease term of at least 80% of the remaining lease term of the Lease with respect to the Relinquished Railcar being sold and (2) which provides for monthly
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lease revenue of at least 80% of the monthly lease revenue of the Lease with respect to the Relinquished Railcar being sold and (C) purchased from either Trinity, TILC, Trinity Rail Leasing Trust II or any other Affiliate of Trinity.
     “Qualifying Replacement Railcar Certificate” means a certificate substantially in the form of Exhibit A-6 hereto, with appropriate insertions and deletions or with such other changes as may be reasonably agreed to by the Agent, and which certificate contains a description of the Railcars and related Leases which are to become Portfolio Railcars and Portfolio Leases in connection with a Permitted Discretionary Sale.
     “Railcar” means a covered hopper car, tank car, boxcar, flat car or other railcar or unit of railroad rolling stock (other than a locomotive), including (i) any and all Parts relating thereto and (ii) any Replacement Railcars and any and all Parts relating thereto, together with any and all accessions, additions, improvements and replacements from time to time incorporated or installed in any item thereof and together with all options, warranties, service contracts, program services, test rights, maintenance rights, support rights, improvement rights and indemnifications relating to any of the foregoing.
     “Railcar Documentation” means with respect to each Railcar, (i) the documents (including microfilm), data, manuals, diagrams and other written information originally furnished by the Manufacturer and/or the Seller thereof on or about the Closing Date, (ii) the documents, records, logs and other data maintained (or required to be maintained) in respect of the Railcars pursuant to the terms of Leases related to such Railcars during the term of such Leases, (iii) the documents, records, logs and other data maintained (or required to be maintained) in respect of the Railcars pursuant to any Applicable Law and (iv) the documents, records, logs and other data maintained (or recommended to be maintained) in respect of the Railcars pursuant to the applicable Manufacturer’s recommendations.
     “Railcar Subsidiary” means (a) a wholly owned (directly or indirectly) subsidiary of the Borrower which is a corporation, limited liability company or similar entity which was created for the sole purpose of owning and/or leasing Railcars predominately used in Canada or to Lessees domiciled in Canada or (b) a trust, the entire beneficial interest in which is wholly owned (directly or indirectly) by the Borrower, which was created for the sole purpose of owning and/or leasing Railcars predominately used in Canada or to Lessees domiciled in Canada, in any case, incorporated, organized or formed under the laws of any state of the United States (or the District of Columbia) or province of Canada or any other jurisdiction acceptable to the Agent.
     “Railcar Portfolio CD-ROM” means a CD-ROM describing each Railcar and Lease to be added to the Portfolio on the Closing Date.
     “Railroad Mileage Credits” means the mileage credit payments made by the railroads under their applicable tariffs to the owner of the Marks on the Railcar.
     “Rating Agency” means each statistical rating organization, if any, then rating the Loans.
     “Rating Agency Condition” means, with respect to any action taken or to be taken under this Agreement, a condition that is satisfied when each Rating Agency (or, if only one Rating Agency is specified, such Rating Agency) has confirmed in writing to the Borrower, the Agent,
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the Collateral Agent and each Derivatives Creditor that such action will not result in the withdrawal, reduction or other adverse action with respect to its then-current rating (including any private or confidential rating) of the Loans.
     “Register” has the meaning set forth in Section 11.06(d).
     “Regulation O, T, U or X” means Regulation O, T, U or X, respectively, of the Board of Governors of the Federal Reserve System as amended, or any successor regulation.
     “Reimbursement Amount” has the meaning set forth in Section 2.07(c)(i).
     “Related Document Inspection” has the meaning set forth in Section 6.11(a).
     “Related Documents” has the meaning set forth in Section 6.11(a).
     “Relinquished Railcar” means any Railcar in the Portfolio which is sold in a Permitted Discretionary Sale.
     “Replacement Railcar” means any Railcar which has replaced a Railcar in the Portfolio.
     “Request” means a Request in substantially the form attached hereto as Exhibit A-1, with appropriate insertions, or with such other changes as may be reasonably agreed to by the Agent.
     “Required Lenders” means, collectively, the Lenders whose aggregate Credit Exposure (as hereinafter defined) constitutes more than fifty percent (50%) of the Credit Exposure of all Lenders at such time.
     “Required Modifications” has the meaning set forth in Section 6.08(c).
     “Required Principal Payment Amount” means, with respect to a Settlement Date, an amount equal to the difference  (if any) of (x) the aggregate principal amount of the Loans outstanding as of such Settlement Date  minus  (y) the  lesser of (i) the Scheduled Targeted Principal Balance applicable to such Settlement Date and (ii) the then most recent Appraised Fair Market Value of all Portfolio Railcars resulting from an Independent Appraisal conducted pursuant to  Section 6.11(b)(i) , Section 6.11(b)(ii) , or  Section 6.11(b)(iii) .
     “Responsible Officer” means, (i) with respect to any Person other than the Borrower or Wilmington Trust Company, the chief financial officer or chief accounting officer, the president, any vice president, treasurer or assistant treasurer of such Person (or, in the case of a Person which is a partnership, limited liability company or trust, any such officer of the general partner, manager, managing member, trustee or Person performing similar management functions in respect thereof), (ii) with respect to the Borrower, the chief financial officer, chief accounting officer, the president, any vice president, treasurer or assistant treasurer of TILC, in its capacity as the managing member of the Borrower, and (iii) with respect to Wilmington Trust Company acting in any capacity hereunder, any officer within the Corporate Trust Administration department of Wilmington Trust Company having direct responsibility for the administration of this Agreement, and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of that officer’s knowledge of and familiarity
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with the particular subject. Any document delivered hereunder that is signed by a Responsible Officer of a Person shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Person and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Person.
     “Restricted Payment” means (i) any dividend or other distribution, direct or indirect, on account of any class of Equity Interests or Equity Equivalents of the Borrower, now or hereafter outstanding, (ii) any redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any class of Equity Interests or Equity Equivalents of the Borrower, now or hereafter outstanding, (iii) any payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire any class of Equity Interests or Equity Equivalents of the Borrower, now or hereafter outstanding, and (iv) any loan, advance, tax sharing payment or indemnification payment to, or investment in, any Affiliate of the Borrower.
     “S&P” means Standard & Poor’s Ratings Group, a division of McGraw Hill, Inc., a New York corporation, and its successor or, absent any such successor, such nationally recognized statistical rating organization as the Borrower and the Agent may select.
     “Sale Agreements” means, with respect to any Railcar and related Lease, if applicable, the applicable Purchase and Sale Agreement, or such other agreement or agreements, in each case in form and substance acceptable to the Agent in its reasonable discretion, between the applicable Seller thereof and the Borrower as shall provide for the purchase of such Railcar and the assignment of the related Lease, if applicable, by the Borrower.
     “Scheduled Targeted Principal Balance” means, with respect any Settlement Date, an amount equal to the product  of (x) the Target Principal Factor with respect to such Settlement Date,  multiplied  by (y) the  difference  of (a) the Aggregate Original Value of all Railcars in the Portfolio as of such Settlement Date,  minus  (if any) (b) the Aggregate Original Value of those whole Railcars (determined by the Borrower in its sole discretion) in the Portfolio as of such Settlement Date, which, if removed from the Portfolio, would cause the Concentration Excess Amount to be equal to zero.
     “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
     “Securitization” means any asset-backed offering sponsored by the Borrower, Trinity and/or their Affiliates, and involving all or any of the Portfolio Railcars and Portfolio Leases.
     “Security Agreement” means the Security Agreement, dated as of the date hereof, between the Borrower, the Collateral Agent and the Agent.
     “Security Deposit” means any cash held by or for the benefit of the Borrower as a “security deposit” (or other similar term) pursuant to any Lease.
     “Security Deposit Account” means the “Security Deposit Account” established by the Depository pursuant to the Depository Agreement.
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     “Seller” means the “seller” under any Sale Agreement.
     “Servicer” means Trinity Industries Leasing Company, a Delaware corporation.
     “Servicer Advances” means any advance (other than any advance giving rise to a Reimbursement Amount) made by the Servicer (from time to time in the Servicer’s sole discretion) to the Borrower in respect of one or more delinquent Lease payments which the Servicer determines will ultimately be recoverable to be deposited in the Collection Account on any Settlement Date or otherwise. Outstanding Servicer Advances shall bear interest at a rate per annum equal to the Applicable Rate and shall be repaid on each Settlement Date in the order of priority of payments set forth in the applicable provisions of Section 2.07(c) .
     “Servicer Event” means a “Servicer Event” as defined in the Servicing Agreement.
     “Servicer Optional Modification Advances” means any advance (other than any advance giving rise to a Reimbursement Amount) made by the Servicer (from time to time in the Servicer’s sole discretion) to the Borrower to fund Optional Modifications. Outstanding Servicer Optional Modification Advances shall  not  bear interest and shall be repaid on each Settlement Date in the order of priority of payments set forth in the applicable provisions of  Section 2.07(c) .
     “Servicer Reimbursable Expenses” means any Operating Expenses properly incurred by the Servicer on behalf of the Borrower in accordance with the terms hereof and of the Servicing Agreement.
     “Servicer Replacement Event” means a “Servicer Replacement Event” as defined in the Servicing Agreement.
     “Servicer’s Fee” shall have the definition set forth in Section 4.02 of the Servicing Agreement.
     “Servicing Agreement” means the Operation, Maintenance, Servicing and Remarketing Agreement, substantially in the form of  Exhibit G  hereto, dated as of the date hereof, among the Borrower, the Agent and the Servicer.
     “Servicing Documents” means the Servicing Agreement, the Insurance Management Agreement, the Administrative Services Agreement and the Marks Company Servicing Agreement, collectively.
     “Settlement Date” means the 16th calendar day of each calendar month occurring after May 31, 2008; provided that if such day is not a Business Day, the applicable “Settlement Date” shall be the next succeeding Business Day.
     “Solvent” means, with respect to any Person as of a particular date, that on such date (i) such Person is able to pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, (ii) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature in their ordinary course, (iii) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such
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Person’s assets would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such Person is engaged or is to engage, (iv) the fair value of the assets of such Person is greater than the total amount of liabilities, including, without limitation, contingent liabilities, of such Person and (v) the aggregate fair saleable value ( i.e ., the amount that may be realized within a reasonable time, considered to be six months to one year, either through collection or sale at the regular market value, conceiving the latter as the amount that could be obtained for the assets in question within such period by a capable and diligent businessman from an interested buyer who is willing to purchase under ordinary selling conditions) of the assets of such Person will exceed its debts and other liabilities (including contingent, subordinated, unmatured and unliquidated debts and liabilities). For purposes of this definition, “debt” means any liability on a claim, and “claim” means (i) a right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured, or (ii) a right to an equitable remedy for breach of performance if such breach gives rise to a payment, whether or not such right is an equitable remedy, is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, secured or unsecured.
     “STB” means the United States Surface Transportation Board and its successors.
     “Step-Up Yield” means, with respect to the Loans, (i) at any time after the Expected Maturity Date until the Term Maturity Date, 50 basis points, (ii) at any time after the Term Maturity Date until the tenth (10 th ) year anniversary of the Closing Date, 100 basis points and (iii) thereafter, until the Termination Date, 300 basis points.
     “Structuring Fee Letter” means the structuring fee letter agreement dated as of May 9, 2008 between TILC and Credit Suisse Securities (USA) LLC regarding certain fees payable to Credit Suisse Securities (USA) LLC on the Closing Date in connection with the transactions contemplated herein.
     “Subsidiary” means with respect to any Person, any corporation, partnership, limited liability company, association or other business entity of which (i) if a corporation, more than 50% of the total voting power of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a partnership, limited liability company, association or business entity other than a corporation, more than 50% of the partnership or other similar ownership interests thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have more than 50% ownership interest in a partnership, limited liability company, association or other business entity if such Person or Persons shall be allocated more than 50% of partnership, association or other business entity gains or losses or shall be or control the managing director, manager or a general partner of such partnership, association or other business entity.
     “Substitution Account” means the Substitution Account established by the Depositary pursuant to the Depository Agreement.
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     “Supermajority Lenders” means the Lenders whose aggregate Credit Exposure (as hereinafter defined) constitutes at least sixty-six and two-thirds (66 2/3%) percent of the Credit Exposure of all Lenders at such time.
     “Supplemental Agreement” means the Supplemental Agreement (CCAAA), dated as of May 9, 2008, among the Borrower, the Collateral Agent, TILC and Wilmington Trust Company, as Account Collateral Agent.
     “Support Facility” shall mean any liquidity or credit support agreement or other facility with a Conduit Lender which relates, either generally or specifically, to this Agreement (including any agreement to purchase an assignment of or participation in, or to make loans or other advances in respect of, Notes or Loans).
     “Support Party” shall mean any bank, insurance company or other entity extending or having a commitment to extend funds to or for the account of a Conduit Lender (including by agreement to purchase an assignment of or participation in, or to make loans or other advances in respect of, Notes or Loans) under a Support Facility.
     “Target Principal Factor” means, with respect to any Settlement Date, the “Target Principal Factor” set forth opposite the period in which such Settlement Date occurs in the table set forth in  Schedule 1.03 .
     “Tax Protected Party” means, without duplication, the Agent, the Collateral Agent, each Creditor, each Support Party and any participant, successor or permitted assign of any thereof.
     “Taxes” has the meaning set forth in Section 3.01.
     “Term Maturity Date” means the eighth (8th) anniversary of the Closing Date.
     “Termination Date” means either (i) the date on which all outstanding Debt of the Borrower has been paid in full or (ii) if no Borrowing has occurred prior to the Commitment Termination Date, the Commitment Termination Date.
     “TILC” means Trinity Industries Leasing Company, a Delaware corporation.
     “Transaction Documents” means the Loan Documents and the Servicing Documents, collectively.
     “Treasury Regulations” means the regulations, including temporary and proposed regulations, promulgated by the United States Department of Treasury with respect to the Code, as such regulations are amended from time to time, or corresponding provisions of future regulations.
     “Trinity” means Trinity Industries, Inc., a Delaware corporation.
     “Trinity Rail Leasing Trust II” means Trinity Rail Leasing Trust II, a Delaware statutory trust.
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     “United States” means the United States of America, including the States and the District of Columbia but excluding its territories and possessions.
     SECTION 1.02 Computation of Time Periods and Other Definitional Provisions. For purposes of computation of periods of time hereunder, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding”. All references to time herein shall be references to Eastern Standard time or Eastern Daylight time, as the case may be, unless specified otherwise. References in this Agreement to Articles, Sections, Schedules, Appendices or Exhibits shall be to Articles, Sections, Schedules, Appendices or Exhibits of or to this Agreement unless otherwise specifically provided. The definitions in  Section 1.01  shall apply equally to both the singular and plural forms of the terms defined.
ARTICLE II
THE CREDIT FACILITY
     SECTION 2.01 Commitment to Lend. Each Committed Lender severally agrees, subject to the Agent’s determination that the terms and conditions of  Sections 2.02  and  4.02  applicable to the Closing Date have been (a) satisfied or, (b) in all other cases, waived by the Agent and the Supermajority Lenders, and on the other terms and conditions set forth in this Agreement, to make a loan (relative to a Committed Lender, its “ Loan ”) to the Borrower equal to such Committed Lender’s Commitment Percentage of the aggregate amount of the Borrowing of Loans to be made on the Closing Date pursuant to this  Section 2.01  in a single Borrowing prior to the Commitment Termination Date in order to fund the acquisition of Railcars and related Leases by the Borrower on the Closing Date. The Loans advanced on the Closing Date with respect to any Railcars and related Leases shall not:
     (i) exceed the lesser of (A) the Initial Principal Amount and (B) the product of (x) the Advance Rate multiplied by (y) the Aggregate Original Value of all Eligible Railcars to be added to the Portfolio on the Closing Date; and
     (ii) in the case of any Committed Lender, exceed its Commitment.
The Borrowing shall be made, severally, from the Committed Lenders in proportion to their respective Commitments. The Committed Lenders have no obligation to make any Loans hereunder except as expressly set forth in this Agreement. Within the foregoing limits, the Borrower may borrow under this  Section 2.01 , repay, or, to the extent permitted or required by Section 2.07 , prepay, Loans, but may  not  reborrow under this  Section 2.01 .
     SECTION 2.02 Procedures for Borrowing. (a) Request; Delivery of Funding Package. The Borrower may provide the Agent with a single Request, signed by a Responsible Officer of each of the Borrower and the Servicer, to include all (but not less than all) of the Railcars and related Leases described in the Railcar Portfolio CD-ROM in the Portfolio on the Closing Date. Concurrent with the delivery of the Request, the Borrower shall deliver to the Agent the Funding Package for each such Railcar. The Borrower shall also set forth in such Request for each Lease in effect prior to the proposed Closing Date a statement that, to the Knowledge of each of the Borrower and the Servicer, (i) the Lessee has made rent payments on time (giving effect to any
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applicable grace periods) under such Lease or, if not, a description of any late payments of which any Facility Party is aware during the one-year period (or shorter period, as applicable) prior to the date of such Request and a summary description of any earlier such defaults, if any, of which the Borrower or Servicer is aware and (ii) no Lease Default or Lease Event of Default under such Lease has occurred during the one-year period (or shorter period, as applicable), prior to the date of such Request or, if that is not the case, a description of any such Lease Default or Lease Event of Default of which the Borrower or Servicer is aware. The Borrower shall supplement the Request with whatever additional information the Agent reasonably requests about the proposed transaction.
     (b) Notice of Borrowing. Upon approval by the Agent (with the consent of the Supermajority Lenders, if required) of the Railcars and related Leases to be included in the Portfolio on the Closing Date in accordance with  Section 2.02(a) , the Borrower may, subject to the terms and conditions of this Agreement, borrow Loans on the Closing Date in respect of each such Railcar and related Lease which is an Eligible Railcar and/or Eligible Lease, as applicable. In such event, the Borrower shall give the Agent a Notice of Borrowing not later than 11:00 A.M. on the third Business Day prior to the date of the proposed Closing Date, specifying:
     (i) the proposed Closing Date of the Borrowing, which shall be a Business Day no earlier than ten Business Days following receipt by the Agent of the Request and a complete Funding Package with respect to such Railcar, unless otherwise approved by the Agent;
     (ii) the aggregate amount of the Borrowing; and
     (iii) a description of the Eligible Railcars to be financed and the Eligible Lease(s) to be pledged on the Closing Date (which may be by cross reference to or attachment of the related Request).
In addition, the Borrower shall deliver to each Committed Lender a copy of the Funding Package with respect to all Railcars funded on the Closing Date within 20 days after the Closing Date.
     (c) Automatic Termination. The Commitments of the Committed Lenders shall automatically terminate on the Commitment Termination Date.
     SECTION 2.03 Notice to Committed Lenders; Funding of Loans. (a) Notice to Committed Lenders. Upon receipt of a Notice of Borrowing, the Agent shall promptly deliver to each Committed Lender a Financing Notice notifying such Committed Lender of the Closing Date and of such Committed Lender’s ratable share of the Loans referred to therein.
     (b) Funding of Loans. Not later than 11:00 A.M. on the Business Day before the Closing Date (the “Prefunding Date ”), each Committed Lender shall make available or instruct (followed by diligent attention to such instruction until such time as the Collateral Agent shall have received such Loan into the Prefunding Account) its correspondent bank, if any, to make available its share of such Borrowing, in Federal or other immediately available funds, to the Collateral Agent into the Prefunding Account. Unless the Agent determines that any applicable condition specified in  Article IV  has not been satisfied or waived, the Agent shall, by 2:30 P.M. on the Closing Date, instruct the Collateral Agent to make the amount of such Borrowing
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available to the Borrower at the general deposit account in the United States designated by the Borrower in immediately available funds in a wire transfer. In the event that the conditions as set forth in  Section 4.02  for such Loan are not satisfied or waived on the Closing Date, the Agent shall instruct the Collateral Agent to return to the Committed Lenders their respective Loans advanced pursuant to this  Section 2.03 . Such amounts contemplated in the first sentence of this  Section 2.03(b)  shall be held in the Prefunding Account.
     A Notice of Borrowing, once delivered to the Agent, shall be irrevocable and binding on the Borrower. Following such Notice of Borrowing, the Borrower shall indemnify each Committed Lender against any loss, cost or expense incurred by such Committed Lender as a result of any failure to fulfill, on or before the proposed Closing Date specified in the Notice of Borrowing, the conditions set forth in  Section 4.02 , including any loss, cost or expense incurred by reason of the liquidation or re-employment of deposits or such funds acquired by the Committed Lenders to fund the Loans to be made pursuant to this Section 2.03(b) . Any such loss, cost or expense shall be paid in accordance with  Section 2.07(c)  after any Committed Lender shall have furnished to the Borrower and the Agent, with reasonable supporting calculations, a notice specifying the amounts thereof.
     (c) [Reserved].
     (d) Obligations of Committed Lenders Several. The failure of any Committed Lender to make a Loan required to be made by it as part of the Borrowing hereunder shall not relieve any other Lender of its obligation, if any, hereunder to make any Loan on the Closing Date of such Borrowing, but, except as otherwise provided in  Section 11.06(g) , no Lender shall be responsible for the failure of any other Lender to make the Loan to be made by such other Lender on the Closing Date.
     SECTION 2.04 Evidence of Loans. (a) Lender Accounts. Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness to such Lender resulting from the Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.
     (b) Agent Records. The Agent shall maintain accounts in which it will record (i) the amount of each Loan made hereunder, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Agent hereunder from the Borrower and each Lender’s share thereof.
     (c) Evidence of Debt. The entries made in the accounts maintained pursuant to subsections (a) and (b) of this Section 2.04 shall be conclusive evidence (absent manifest error) of the existence and amounts of the obligations therein recorded;  provided , however , that the failure of any Lender or the Agent to maintain such accounts or any error therein shall not in any manner affect the obligations of the Borrower to repay the Loans in accordance with their terms.
     (d) Notes. Notwithstanding any other provision of this Agreement, if any Lender shall request and receive a Note or Notes as provided in  Section 11.06  or otherwise, then the Loans of such Lender shall be evidenced by a single Note substantially in the form of  Exhibit B ,
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and payable to the order of such Lender in an amount equal to the aggregate unpaid principal amount of such Lender’s Loans.
     (e) Note Endorsements. Each Lender having a Note shall record the date and amount of each Loan made by it and the date and amount of each payment of principal made by the Borrower with respect thereto, and may, if such Lender so elects in connection with any transfer or enforcement of its Note, endorse on the reverse side or on the schedule, if any, forming a part thereof appropriate notations to evidence the foregoing information with respect to each outstanding Loan evidenced thereby; provided  that the failure of any Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower hereunder or under any such Note. Each Lender is hereby irrevocably authorized by the Borrower so to endorse its Note and to attach to and make a part of its Note a continuation of any such schedule as and when required. When the Borrower has paid a Note in full, such Lender will promptly return such Note to the Agent, who will return such Note to the Borrower, against receipt therefor, marked “PAID IN FULL”.
     (f) Lost, Mutilated and Destroyed Notes, etc. If any Note issued to a Lender pursuant to this Agreement shall become mutilated, destroyed, lost or stolen, the Borrower shall, upon the written request of the holder of such Note, execute and deliver to the Agent, who shall endorse and deliver to the applicable Lender in replacement thereof a new Note, payable to the same holder in the same principal amount and dated the same date as the Note so mutilated, destroyed, lost or stolen. If the Note being replaced has become mutilated, such Note shall be surrendered to the Borrower for cancellation and if the Note being replaced has been destroyed, lost or stolen, the holder of such Note shall furnish to the Borrower such indemnification as may be required by the Borrower to hold the Borrower harmless and evidence reasonably satisfactory to the Borrower of the destruction, loss or theft of such Note and of the ownership thereof;  provided ,  however , that if the holder of such Note is a Lender, the written undertaking of such Lender shall be sufficient indemnity for purposes of this  Section 2.04(f) .
     SECTION 2.05 Interest. (a) Rate of Interest. (i) Each Loan (or any amounts held in the Prefunding Account pursuant to a Notice of Borrowing issued by the Borrower as provided in  Section 2.03(b) ) shall bear interest on the outstanding principal amount thereof, for each day (excluding the last day) during each Interest Period applicable thereto, at a rate per annum equal to the Applicable Rate for such day;  provided  that any change to the interest rate shall not take effect until the next succeeding Interest Period after such designation. Such interest shall be payable in arrears on each Settlement Date and on the Termination Date.
     (ii) At any time during which an Event of Default has occurred and is continuing, each Loan shall bear additional interest (in addition to the interest payable pursuant to  Section 2.05(a)(i) ) on the outstanding principal amount thereof, for each day during each Interest Period applicable thereto, at a rate per annum equal to the Default Margin and such accrued additional interest shall be aggregated on the last day of such Interest Period (all such aggregated additional interest, the “ Aggregated Default Interest ”). Such Aggregated Default Interest shall bear interest on the outstanding amount thereof, for each day (excluding the last day) during each Interest Period applicable thereto, at a rate per annum equal to the Aggregated Default Interest Rate and such accrued interest shall be aggregated on the last day of such Interest Period with the
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Aggregated Default Interest and shall be deemed “Aggregated Default Interest” upon such aggregation. Aggregated Default Interest and the interest thereon shall be payable in arrears on the date on which the aggregate principal amount of the Loans have been paid in full pursuant to the terms of this Agreement.
     (b) Determination and Notice of Interest Rates. The Agent shall determine each interest rate applicable to the Loans (or any amounts held in the Prefunding Account pursuant to a Notice of Borrowing issued by the Borrower as provided in Section 2.03(b) ) hereunder as provided herein. The Agent shall give prompt notice to the Borrower and the participating Lenders of each rate of interest so determined, and its determination thereof shall be conclusive in the absence of manifest error.
     SECTION 2.06 Repayment and Maturity of Loans.
     (a) Term Maturity Date. At any time and from time to time following the occurrence of the Term Maturity Date, if the outstanding principal balance of the Loans is  greater  than zero then the Collateral Agent (at the written direction of the Agent and the Required Lenders, which direction shall specify the manner in which such Collateral shall be sold as well as the amount) may direct the Borrower through a written notice of direction to (and upon receipt of such written notice of direction the Borrower shall or shall cause the Servicer to) sell all or any part of the Collateral in the amount and in the manner specified by the Collateral Agent in such written notice of direction, and upon any such written notice of direction the outstanding principal amount of the Loans in an amount equal to the aggregate of the Allocable Debt for each Railcar so requested to be sold shall become immediately due and payable.
     (b) Legal Final Maturity Date. On the Legal Final Maturity Date, the remaining principal balance of the Loans and all other Obligations under the Loan Documents shall become immediately due and payable.
     SECTION 2.07 Prepayments. (a) Voluntary Prepayments. Subject always to Section 7.05, the Borrower shall have the right at any time and from time to time to voluntarily prepay the Loans in whole or in part;  provided ,  however , that (i) each partial prepayment of Loans shall be in a minimum principal amount of $1,000,000 and (ii) the Borrower shall have given prior written or telecopy notice (or telephone notice promptly confirmed by written or telecopy notice) to the Agent by 10:00 A.M., at least five Business Days prior to the date of prepayment. Each notice of prepayment shall specify the prepayment date and the principal amount to be prepaid. Each notice of prepayment shall be irrevocable and shall commit the Borrower to prepay such Loans by the amount stated therein on the date stated therein. All prepayments under this  Section 2.07(a)  and/or  Section 2.07(b) shall be accompanied by Optional Prepayment Premium (if any), accrued interest on the principal amount being prepaid to the date of payment together with any Funding Losses amounts owed to any Lender.
     (b) Mandatory Prepayments. The Borrower shall be required to prepay Loans as provided in clauses (i) through (iii) of this Section 2.07(b) . All payments under this  Section 2.07(b)  shall be accompanied by Optional Prepayment Premium (if any), accrued interest on the principal amount being prepaid to the date of payment together with any Funding Losses owed to any Lender.
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     (i) On each Settlement Date, an aggregate amount equal to the amount of all Available Collections and other amounts on deposit in the Collection Account (as of the Calculation Date immediately preceding such Settlement Date) and, at the Agent’s discretion (subject to  Section 6.14(c) ), the Liquidity Reserve Account shall be applied (and the Loans, together with other Obligations then due, shall be prepaid to the extent of cash available therefor) in accordance with the provisions of Section 2.07(c)(i)  or  2.07(c)(ii) , as applicable.
     (ii) Following the occurrence of an Event of Default and acceleration of the Loans, the outstanding Loans shall be prepaid by the Borrower from the Collection Account or Net Cash Proceeds Account, as applicable, immediately, together with accrued interest thereon to the date of such prepayment, the amount of Funding Losses, if any, owed to each Lender and other Obligations owed hereunder, all in accordance with the provisions of Section 2.07(c)(ii) or Section 2.07(c)(iii), as applicable.
     (iii) On the first Business Day after receipt thereof by the Borrower, and notwithstanding the provisions of Section 2.07(c)(i)  or  (ii) , any Net Cash Proceeds received from any Asset Disposition and not otherwise deposited into the Substitution Account or Modifications and Improvement Account as permitted by  Section 6.09  shall be paid into the Net Cash Proceeds Account and applied in the order of priority set forth in  Section 2.07(c)(iii) .
     (iv) On the first Settlement Date to occur after receipt of the proceeds of any rescission pursuant to Section 4.9 of a Purchase and Sale Agreement (or any time before such first Settlement Date, if elected by the Borrower), unless the Seller shall have elected to replace the Railcar subject to rescission with one or more Qualifying Replacement Railcars, the proceeds of such rescission (other than in-kind proceeds) shall be applied  first  to costs and expenses described in Section 4.9(ii) of the applicable Purchase and Sale Agreement,  second  an amount equal to the Allocable Debt in respect of such Railcar immediately prior to such rescission shall be applied in the order of priority set forth in  Section 2.07(c)(iii)  and  third  the balance, if any, at the direction of the Borrower.
     (c) Application of Payments and Prepayments. (i) Application of Collections Account. Subject to Section 2.07(c)(ii), so long as (x) no Event of Default has occurred and is continuing and (y) no Amortization Event has occurred and is continuing, on each Settlement Date, all amounts on deposit in the Collection Account as of the Calculation Date immediately preceding such Settlement Date and amounts which are applied in accordance with  Section 6.14(c)  from the then current balance of the Liquidity Reserve Account shall be applied by the Depositary on such Settlement Date in the following order of priority:
     first, to the Servicer, for distribution to the Lessees, if any, whose payments in respect of the applicable Leases are not made net of any Railroad Mileage Credits due and owing to such Lessee, an amount equal to the Railroad Mileage Credits due to such Lessee for which an allocation has not previously been made pursuant to this clause (or any corresponding clause of any other subsection in this  Section 2.07(c) ) as certified to
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the Agent by the Servicer not later than the Calculation Date immediately preceding such Settlement Date;
     second, ratably (x) to reimburse the Servicer for outstanding Servicer Reimbursable Expenses, (y) to reimburse or pay the Agent and/or the Collateral Agent for any fees and expenses incurred by the Agent and/or the Collateral Agent not described below (including, without limitation, reasonable attorney’s fees and expenses and the fees and expenses of any person appointed by the Agent to replace the Servicer pursuant to the Servicing Agreement) in connection with any Servicer Replacement Event or Event of Default and the exercise by the Agent and/or the Collateral Agent of any right or remedy hereunder and not previously reimbursed or paid by the Lenders and (z) to the reimbursement of the Lenders for any amounts paid by the Lenders to the Agent in compensation for fees and expenses incurred by the Agent as described in this  clause second ;
     third, if (A) any amount (a “Reimbursement Amount”) paid by a Lessee into the Collection Account since the last Settlement Date was specifically paid to reimburse any expense paid by the Servicer under the Servicing Agreement (but not to include Servicer Advances or other payments by the Servicer in respect of unpaid Monthly Rent amounts) because the Lessee had failed to pay an amount due or perform an obligation under the applicable Lease, (B) the Lessee has cured all payment defaults under the applicable Lease and (C) the Servicer has provided the Agent with documentation that enables the Agent to verify the amounts distributable under this  clause third , to reimburse the Servicer for such payment in an amount up to but not exceeding, the Reimbursement Amount;
     fourth, to the payment of the Servicer’s Fees payable on such Settlement Date, together with the aggregate amount of any Servicer’s Fees which were due and payable on any previous Settlement Date and remain unpaid;
     fifth, ratably (x) to the payment of accrued and unpaid interest (except for Aggregated Default Interest and accrued and unpaid interest thereon and interest based on the Step-Up Yield) on the Loans and (y) to the payment of Derivatives Obligations (other than for the payment of Derivatives Termination Value), if any, then due and payable, and (z) to the payment of all indemnities in respect of Taxes, Other Taxes, stamp taxes, Funding Losses, increased costs referred to in Section 3.03 , losses, costs and expenses referred to in  Section 2.03(b) , in each case with respect to the Protected Parties and other amounts, other than principal or interest on the Loans, payable to any Protected Party (other than the Servicer) in accordance with the Loan Documents;
     sixth, to reimburse the Servicer for outstanding Servicer Advances, together with accrued interest thereon;
     seventh, ratably (x) to the Operating Expenses Account in an amount equal to the Operating Expenses anticipated to be incurred by the Borrower and/or the Servicer in the one-month period following such Settlement Date, (y) to the Modifications and Improvements Account in an amount equal to the  lesser  of (i) the amount of
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modifications and improvements permitted to be funded from an Account under Section 6.08 or Section 6.09 or (ii) the amount of modifications and improvements anticipated to be incurred in the one-month period following such Settlement Date and (z) to the Maintenance Reserve Account in an amount equal to the cost of replacement Parts anticipated to be incurred in the one-month period following such Settlement Date;
     eighth, to the Liquidity Reserve Account in an amount equal to the amount (if any) by which (x) the Liquidity Reserve Target Amount  exceeds  (y) the balance of the Liquidity Reserve Account, in each case as determined on the immediately preceding Calculation Date;
     ninth, to the Lenders, for the payment of the Required Principal Payment Amount;
     tenth, to the Derivatives Creditors for the payment of Derivatives Termination Value (other other than for the payment of Derivatives Termination Value resulting from a Derivatives Creditor Event);
     eleventh, to the Lenders, for the payment of any Optional Prepayment Premium;
     twelfth, to the payment of accrued and unpaid interest on the Loans based on the Step-Up Yield;
     thirteenth, to the Derivatives Creditors for the payment of Derivatives Termination Value resulting from a Derivatives Creditor Event;
     fourteenth, to (x) the Operating Expenses Account an amount determined by the Servicer to be prudent to establish a reserve for expected future Operating Expenses, and (y) the Maintenance Reserve Account and/or the Modifications and Improvements Account an amount determined by the Servicer to be prudent to establish a reserve for expected future maintenance, improvements and modifications of Portfolio Railcars;
     fifteenth, to the payment of the unpaid Aggregated Default Interest on the Loans and any accrued and unpaid interest thereon;
     sixteenth, ratably (x) the payment of Optional Modifications and (y) to the repayment of Servicer Optional Modification Advances; and
     seventeenth, at the direction of the Borrower.
     (ii) Application of Collections Account if an Event of Default or Amortization Event has Occurred and is Continuing. Notwithstanding anything to the contrary set forth in this Agreement or any other Loan Document, if (x) any Event of Default has occurred and is continuing or (y) any Amortization Event has occurred and is continuing, unless the Agent shall elect, with the consent of the Supermajority Lenders, to apply such amounts in accordance with  Section 2.07(c)(i)  above, on each Settlement Date, all amounts on deposit in the Collection Account as of the Calculation Date immediately preceding such Settlement Date and amounts which are applied in accordance with  Section 6.14(c)  from the then current balance of the Liquidity Reserve Account and all
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other payments received and all amounts (other than Net Cash Proceeds deposited into the Net Cash Proceeds Account which shall first be applied in accordance with  Section 2.07(c)(iii) ) held or realized by or for the benefit of the Agent or the Collateral Agent (including any amount realized by the Agent or the Collateral Agent after the exercise of any remedy as set forth herein or in any other Loan Document and all proceeds of the Collateral), and all payments or amounts (other than Net Cash Proceeds deposited into the Net Cash Proceeds Account which shall first be applied in accordance with  Section 2.07(c)(iii) ) then held or thereafter received by or for the benefit of the Agent or the Collateral Agent hereunder or under the Loan Documents or in the Accounts shall be applied by the Depositary on such Settlement Date in the following order of priority:
     first, to the Servicer, for distribution to the Lessees, if any, whose payments in respect of the applicable Leases are not made net of any Railroad Mileage Credits due and owing to such Lessee, an amount equal to the Railroad Mileage Credits due to such Lessee for which an allocation has not previously been made pursuant to this clause (or any corresponding clause of any other subsection in this  Section 2.07(c) ) as certified to the Agent by the Servicer not later than the Calculation Date immediately preceding such Settlement Date;
     second, ratably (x) to reimburse the Servicer for outstanding Servicer Reimbursable Expenses, (y) to reimburse or pay the Agent and/or the Collateral Agent for any fees and expenses incurred by the Agent and/or the Collateral Agent not described below (including, without limitation, reasonable attorney’s fees and expenses and the fees and expenses of any person appointed by the Agent to replace the Servicer pursuant to the Servicing Agreement) in connection with any Servicer Replacement Event or Event of Default and the exercise by the Agent and/or the Collateral Agent of any right or remedy hereunder and not previously reimbursed or paid by the Lenders and (z) to the reimbursement of the Lenders for any amounts paid by the Lenders to the Agent in compensation for fees and expenses incurred by the Agent as described in this  clause second ;
     third, if (A) any Reimbursement Amount since the last Settlement Date was specifically paid to reimburse any expense paid by the Servicer under the Servicing Agreement (but not to include Servicer Advances or other payments by the Servicer in respect of unpaid Monthly Rent amounts) because the Lessee had failed to pay an amount due or perform an obligation under the applicable Lease, (B) the Lessee has cured all payment defaults under the applicable Lease and (C) the Servicer has provided the Agent with documentation that enables the Agent to verify the amounts distributable under this  clause third , to reimburse the Servicer for such payment in an amount up to but not exceeding, the Reimbursement Amount;
     fourth, to the payment of the Servicer’s Fee payable on such Settlement Date, together with the aggregate amount of any Servicer’s Fees which were due and payable on any previous Settlement Date and remain unpaid;
     fifth, ratably (x) to the payment of accrued and unpaid interest (except for Aggregated Default Interest and accrued and unpaid interest thereon and interest based on
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the Step-Up Yield) on the Loans and (y) to the payment of Derivatives Obligations (other than for the payment of Derivatives Termination Value), if any, then due and payable, and (z) to the payment of all indemnities in respect of Taxes, Other Taxes, stamp taxes, Funding Losses, increased costs referred to in  Section 3.03 , losses, costs and expenses referred to in Section 2.03(b) , in each case with respect to the Protected Parties and other amounts, other than principal or interest on the Loans, payable to any Protected Party (other than the Servicer) in accordance with the Loan Documents;
     sixth, ratably (x) to the Operating Expenses Account in an amount equal to the Operating Expenses anticipated to be incurred by the Borrower and/or the Servicer in the one-month period following such Settlement Date, (y) so long as no Event of Default has occurred and is continuing, to the Modifications and Improvements Account in an amount equal to the  lesser  of (i) the amount of modifications and improvements permitted to be funded from an Account under  Section 6.08  or  Section 6.09 or (ii) the amount of modifications and improvements anticipated to be incurred in the one-month period following such Settlement Date and (z) so long as no Event of Default has occurred and is continuing, to the Maintenance Reserve Account in an amount equal to the cost of replacement Parts anticipated to be incurred in the one-month period following such Settlement Date;
     seventh, to the Liquidity Reserve Account in an amount equal to the amount (if any) by which (x) the Liquidity Reserve Target Amount  exceeds  (y) the balance of the Liquidity Reserve Account, in each case as determined on the immediately preceding Calculation Date;
     eighth, to reimburse the Servicer for outstanding Servicer Advances, together with accrued interest thereon;
     ninth, ratably (x) to the payment of the unpaid principal amount of the Loans, (y) to the Derivatives Creditors for the payment of Derivatives Termination Value (other other than for the payment of Derivatives Termination Value resulting from a Derivatives Creditor Event), if any, and (z) to the Lenders, for the payment of any Optional Prepayment Premium ;
     tenth, to the payment of accrued and unpaid interest on the Loans based on the Step-Up Yield;
     eleventh, to the Derivatives Creditors for the payment of Derivatives Termination Value resulting from a Derivatives Creditor Event;
     twelfth, to the payment of the unpaid Aggregated Default Interest on the Loans and any accrued and unpaid interest thereon;
     thirteenth, ratably (x) the payment of Optional Modifications and (y) to the repayment of Servicer Optional Modification Advances; and
     fourteenth, at the direction of the Borrower.
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     (iii) Third Waterfall. Except as otherwise provided in Section 2.07(b)(iv), all amounts on deposit in the Net Cash Proceeds Account shall be applied by the Depositary as and when received, provided however, if no Event of Default or Amortization Event has occurred and is continuing, the Borrower may elect that all amounts on deposit in the Net Cash Proceeds Account be applied by the Depositary on the next Settlement Date following such deposit, in each case in accordance with the following priority:
     first, ratably (x) to the payment of accrued and unpaid interest on the Loans (excluding Aggregated Default Interest but including interest based on the Step-Up Yield), (y) to the payment of Derivatives Obligations, if any, then due and payable and (z) to the Lenders for the payment of all indemnities in respect of Taxes, Other Taxes, stamp taxes, Funding Losses, increased costs referred to in  Section 3.03 , losses, costs and expenses referred to in  Section 2.03(b) , in each case in this  clause first  relating to the principal portion of the Loans being paid on such date pursuant to  clause second  below;
     second, ratably (x) to the Lenders for the payment of the applicable Prepayment Amount, and (y) to the Derivatives Creditors for the payment of Derivatives Termination Value (other other than for the payment of Derivatives Termination Value resulting from a Derivatives Creditor Event), if any, and (z) to the Lenders, for the payment of any Optional Prepayment Premium;
     third, unless an Event of Default or Amortization Event has occurred and is continuing, to be applied in the order of priority set forth in  Section 2.07(c)(i) ; and
     fourth, if an Event of Default or Amortization Event has occurred and is continuing, to be applied in the order of priority set forth in  Section 2.07(c)(ii) ;
     (iv) Earnings on Cash Equivalents. Any earnings on Cash Equivalents shall constitute part of the Collateral and shall be applied in accordance with  Section 2.07(c) . Any losses resulting from any Cash Equivalents shall be for the Borrower’s account, and under no circumstances shall the Collateral Agent, the Agent or any Lender have any liability or responsibility therefor.
     (d) Release of Amounts from Liquidity Reserve Account. On any Settlement Date, if there exists in the Liquidity Reserve Account any amount in excess of the Liquidity Reserve Target Amount (after giving effect to all other payments to be made on such Settlement Date and as calculated on the Calculation Date immediately preceding such Settlement Date), the Agent shall be deemed to have released such excess amount from the Liquidity Reserve Account and such excess amount shall be applied by the Depositary in accordance with  Section 2.07(c) .
     SECTION 2.08 Optional Replacement of Lenders (Non-Pro-Rata). If (i) any Lender or other Tax Protected Party has demanded compensation or indemnification pursuant to  Section 3.01 ,  3.03  or  3.04 , or (ii) the obligation of any Lender to fund its Loans at the Adjusted Eurodollar Rate has been suspended pursuant to  Section 3.02  or (iii) any Lender has failed to consent to a proposed amendment, waiver, discharge or termination which pursuant to the terms of  Section 11.03  or any other provision of any Loan Document requires the consent of the Supermajority Lenders or all of the Lenders, the Borrower shall have the right, with the prior
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written consent of the Agent, to (i) remove such Lender and all related Tax Protected Parties or (ii) replace such Lender and all related Tax Protected Parties by causing the related Lender to assign its outstanding Loans and Notes (if any) to one or more existing Lenders or Eligible Assignees pursuant to  Section 11.06 . The replacement of a Lender pursuant to this  Section 2.08  shall be effective on the tenth Business Day (the “ Replacement Date ”) following the date of notice of such replacement to the Lenders through the Agent, subject to the satisfaction of the following conditions:
     (A) each replacement Lender and/or Eligible Assignee, and each Tax Protected Party subject to replacement, shall have satisfied the conditions to an Assignment and Acceptance set forth in  Section 11.06(b)  and, in connection therewith, the replacement Lender(s) and/or Eligible Assignee(s) shall pay to each Tax Protected Party subject to replacement an amount equal in the aggregate to the sum of (A) the principal of, and all accrued but unpaid interest on, its outstanding Loans and (B) all accrued but unpaid fees owing to it pursuant to  Section 2.09 ; and
     (B) the Borrower shall have paid to the Agent for the account of each replaced Tax Protected Party an amount equal to all obligations owing to such replaced Tax Protected Party by the Borrower pursuant to this Agreement and the other Loan Documents (other than those obligations of the Borrower referred to in  clause (A)  above).
In the case of the removal of a Tax Protected Party pursuant to this Section 2.08, upon payment by the Borrower to the Agent for the account of the Tax Protected Party subject to such removal of an amount equal to the sum of (i) the aggregate principal amount of all Loans held by such Tax Protected Party and (ii) all accrued interest, fees and other amounts owing to such Tax Protected Party hereunder, including, without limitation, all amounts payable by the Borrower to such Tax Protected Party under Article III  or  Sections 11.05  and  11.06 , such Tax Protected Party shall cease to constitute a Tax Protected Party hereunder; provided  that the provisions of this Agreement (including, without limitation, the provisions of  Article III  and  Sections 11.05  and 11.06 ) shall continue to govern the rights and obligations of a removed Tax Protected Party with respect to any Loans made or any other actions taken by such removed Tax Protected Party while it was a Tax Protected Party.
     SECTION 2.09 Agent Fee Letter. On each Settlement Date, the Borrower shall pay the Agent for its account such fee or fees as shall be payable at such time in accordance with the Agent Fee Letter.
     SECTION 2.10 Pro-rata Treatment. Except to the extent otherwise provided herein, the Borrowing, each payment or prepayment of principal of or interest on any Loan, each payment of fees and each conversion or continuation of any Loan, shall be allocated pro-rata among the relevant Lenders in accordance with the respective principal amounts of the outstanding Loans of such Lenders);  provided  that, in the event any amount paid to any Lender pursuant to this  Section 2.10  is rescinded or must otherwise be returned by the Agent, each Lender shall, upon the request of the Agent, repay to the Agent the amount so paid to such Lender, with interest for the period commencing on the date such payment is returned by the Agent until the date the Agent receives such repayment at a rate per annum equal to, during the period to but excluding
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the date two Business Days after such request, the Federal Funds Rate, and thereafter, the Corporate Base Rate plus two percent per annum.
     SECTION 2.11 Sharing of Payments. The Lenders agree among themselves that, except to the extent otherwise provided herein, if any Lender shall obtain payment in respect of any Loans or any other obligation owing to such Lender under this Agreement through the exercise of a right of setoff, banker’s lien or counterclaim, or pursuant to a secured claim under Section 506 of the Bankruptcy Code or other security or interest arising from, or in lieu of, such secured claim, received by such Lender under any applicable bankruptcy, insolvency or other similar law or otherwise, or by any other means, in excess of its pro-rata share of such payment as provided for in this Agreement, such Lender shall promptly pay in cash or purchase  first , from the Lenders a participation in the Loans in such amounts received by any such Lender, and make such other adjustments from time to time, as shall be equitable to the end that all the Lenders share such payment in accordance with their respective ratable shares as provided for in this Agreement. The Lenders further agree among themselves that if payment to a Lender obtained by such Lender through the exercise of a right of setoff, banker’s lien, counterclaim or other event as aforesaid shall be rescinded or must otherwise be restored, each Lender which shall have shared the benefit of such payment shall, by payment in cash or a repurchase of a participation theretofore sold, return its share of that benefit (together with its share of any accrued interest payable with respect thereto) to each Lender whose payment shall have been rescinded or otherwise restored. The Borrower agrees that any Lender so purchasing such a participation may, to the fullest extent permitted by law, exercise all rights of payment, including setoff, banker’s lien or counterclaim, with respect to such participation as fully as if such Lender were a holder of such Loans or other obligation in the amount of such participation. If under any applicable bankruptcy, insolvency or other similar law, any Lender receives a secured claim in lieu of a setoff to which this  Section 2.11  applies, such Lender shall, to the extent practicable, exercise its rights in respect of such secured claim in a manner consistent with the rights of the Lenders under this  Section 2.11  to share in the benefits of any recovery on such secured claim.
     SECTION 2.12 Payments, Computations, Proceeds of Collateral, Etc. (a) Unless otherwise expressly provided in a Loan Document, all payments by the Borrower to the Protected Parties pursuant to each Loan Document shall be made by the Borrower (or by its designee) to the Agent for the  pro rata  account of the Protected Parties entitled to receive such payment or, at the direction of the Agent, directly to such Protected Parties. All payments shall be made without setoff, deduction (except for Taxes which are expressly addressed in  Section 3.01 ) or counterclaim not later than 11:00 A.M. New York City time on the date due in Dollars in same day or immediately available funds to such account or accounts (if payment is to be made directly to the Protected Parties) as the Agent shall specify from time to time by notice to the Borrower. Funds received after that time shall be deemed to have been received by the Agent or a Protected Party, as the case may be, on the next succeeding Business Day. In the event that a payment is made to Agent for the  pro rata  account of the Protected Parties entitled to such payment, the Agent shall promptly remit in same day funds to each Protected Party its share, if any, of such payments received by the Agent for the account of such Protected Party. Whenever any payment is to be made hereunder or under any Loan, or whenever the last day of any Interest Period would otherwise occur on a day other than a Business Day, such payment shall be made, and the last day of such Interest Period shall occur, on the next succeeding Business Day and interest at the Applicable Rate shall accrue on such amount from the original
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due date to such next Business Day; provided, that if such extension would cause the last day of such Interest Period to occur in a new calendar month, the last day of such Interest Period shall occur on the next preceding Business Day.
     (b) Distributions by the Agent. Each such distribution by the Agent to such Protected Party shall be made in accordance with Section 2.07 . Upon the request of any Protected Party, the Agent in its sole discretion may cause to be distributed to such Protected Party on such due date a corresponding amount with respect to the amount then due such Protected Party. If and to the extent the Borrower shall not have so made such payment in full to the Agent and the Agent shall have so caused to be distributed to such Protected Party a corresponding amount with respect to the amount then due such Protected Party, such Protected Party shall repay forthwith on demand such amount distributed to such Protected Party together with interest thereon, for each day from the date such amount is distributed to such Protected Party until the date such Protected Party repays such amount to the Agent, at the Federal Funds Rate for the first three Business Days after demand by the Agent and at the Applicable Rate thereafter until the date such Protected Party repays such amount to the Agent.
     (c) Computations. All computations of interest and fees hereunder shall be made on the basis of the actual number of days elapsed over a year of 360 days. Interest shall accrue from and include the date of borrowing but exclude the date of payment.
     SECTION 2.13 Interest Rate Risk Management.
     (a) On the Closing Date, the Borrower will enter into, and maintain until the earlier of (i) the Expected Maturity Date or (ii) the Termination Date, one or more Derivatives Agreements with an aggregate notional balance equal to or exceeding ninety percent (90%) (but not for any period in excess of 30 consecutive days, more than 110%) of the then Scheduled Targeted Principal Balance. On the Expected Maturity Date (unless the Termination Date has occurred), at the request of the Agent, the Borrower will enter into, and maintain until the Termination Date, one or more Derivatives Agreements with an aggregate notional balance equal to or exceeding ninety percent (90%) (but not for any period in excess of 30 consecutive days, more than 110%) of the then outstanding principal amount of the Loans. Such Derivative Agreements shall provide that notional balances may be adjusted downward from time to time to reflect any prepayments of the Loans.
     (b) If the Borrower, or the Servicer, on behalf of the Borrower, fails to comply with Section 2.13(a), the Required Lenders shall have the right, in their sole discretion and at the expense of the Borrower if necessary (as determined in the sole discretion of the Required Lenders), to direct the Agent to enter into or maintain one or more Derivatives Agreements selected by the Required Lenders (in their sole discretion) on behalf of the Borrower such that, after giving effect to such action, the Borrower will be in compliance with  Section 2.13(a) . In the event the Required Lenders determine to direct the Agent to enter into or maintain a Derivatives Agreement on the Borrower’s behalf, the Required Lenders shall promptly send a copy of any such agreement to the Borrower. Reasonable costs and expenses of the Required Lenders related to the entry into and maintenance of Derivatives Agreements shall be paid by the Borrower.
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     (c) If, at any time while the Loans or other obligations under the Transaction Documents remain unpaid, a Derivatives Creditor ceases to be an Eligible Derivatives Creditor, the Borrower shall within sixty (60) days after it obtains Knowledge of such event, either (i) replace the non-conforming Derivatives Creditor with an Eligible Derivatives Creditor or (ii) require the non-conforming Derivatives Creditor to deliver a letter of credit or provide alternative credit support in order to support its obligations under the Derivatives Agreement, as the Borrower and such non-conforming Derivatives Creditor may agree, subject to the consent of the Agent and the prior written confirmation that the Rating Agency Condition has been satisfied.
     (d) All payments received from all such Derivatives Agreements shall be deposited directly into the Collection Account.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
     SECTION 3.01 Taxes. (a) Payments Net of Certain Taxes. Any and all payments by the Borrower to or for the account of any Tax Protected Party hereunder or under any other Loan Document shall be made free and clear of and without deduction for any and all present or future taxes, duties, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding, in the case of each Tax Protected Party, taxes imposed on its net income, profits and franchise, branch profits, capital, doing business or net worth taxes imposed on it, in each case by the jurisdiction under the laws of which such Tax Protected Party is organized, has its applicable lending office or does business (unless such imposition is made by a jurisdiction other than one where such Tax Protected Party is organized or has its applicable lending office and is solely on account of such Tax Protected Party being a party to, receiving a payment or income under, or enforcing, this Agreement or any other Loan Document), or any political subdivision thereof (all such non-excluded taxes, duties, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as “ Taxes ”). If the Borrower shall be required by law to deduct or withhold any Taxes from or in respect of any sum payable under this Agreement or any other Loan Document to any Tax Protected Party, (i) subject to  clauses (e)  and  (f)  of this  Section 3.01 , the sum payable shall be increased as necessary so that after making all required deductions and withholdings (including deductions and withholdings applicable to additional sums payable under this  Section 3.01 ) such Tax Protected Party receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and withholdings, (iii) the Borrower shall pay the full amount deducted or withheld to the relevant taxation authority or other authority in accordance with Applicable Law and (iv) the Borrower shall furnish to the Agent, at the Agent’s Office, the original or a certified copy of a receipt evidencing payment thereof.
     (b) Other Taxes. In addition, the Borrower agrees to pay any and all present or future stamp, documentary or excise taxes or similar levies which arise from any payment made under this Agreement or any other Loan Document or from the execution or delivery of, or otherwise with respect to, this Agreement or any other Loan Document (hereinafter referred to as “ Other Taxes ”).
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     (c) Additional Taxes. The Borrower agrees to indemnify each Tax Protected Party for the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable under this  Section 3.01 ) paid by such Tax Protected Party and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto within 30 days after receipt of documentation reasonably evidencing the amount and nature of such payment.
     (d) Tax Forms and Certificates. Each Lender organized under the laws of a jurisdiction outside the United States (a “ Non-U.S. Lender ”) shall, on or prior to the date of its execution and delivery of this Agreement in the case of each Lender listed on the signature pages thereof and on or prior to the date on which it becomes a Lender in the case of each other Lender, and from time to time thereafter as required by law on or prior to the expiration of the form or certificate most recently provided, provide the Borrower and the Agent with true, complete and correct (i) Internal Revenue Service Form W-8BEN or W-8ECI, as appropriate, or any successor form prescribed by the Internal Revenue Service, certifying that such Lender is entitled to benefits under an income tax treaty to which the United States is a party which reduces to zero the rate of withholding tax on payments of interest or certifying that the income receivable pursuant to this Agreement is effectively connected with the conduct of a trade or business in the United States or (ii) any other form or certificate required by any United States taxing authority (including any certificate required by Sections 871(h) and 881(c) of the Code), certifying that such Lender is entitled to a complete exemption from tax on payments pursuant to this Agreement or any of the other Loan Documents. Additionally, if a Lender or Tax Protected Party sells, assigns or transfers any participation in a Loan to another Person, such Lender or Tax Protected Party shall provide any new forms required as a result of such sale or transfer (including, if necessary, Internal Revenue Service Form W-8IMY).
     (e) Failure to Provide Tax Forms and Certificates. For any period with respect to which a Lender has failed to provide the Borrower and the Agent with the appropriate form or certificate in the manner and as prescribed by  Section 3.01(d)  (unless such failure is due to a change in treaty, law or regulation occurring subsequent to the date on which a form originally was required to be provided), neither such Lender nor any related Tax Protected Party shall be entitled to additional amounts under Section 3.01(a)  or indemnification under  Section 3.01(b)  with respect to Taxes imposed by the United States or any political subdivision therein as a result of such failure;  provided ,  however , that should a Tax Protected Party, which is otherwise exempt from or subject to a reduced rate of withholding tax, become subject to Taxes because of its or any related Lender’s failure to deliver a form required to be delivered hereunder, the Borrower shall take such steps as such Lender or Tax Protected Party shall reasonably request at such Tax Protected Party’s cost to assist such Tax Protected Party to recover such Taxes.
     (f) Obligations in Respect of Non-U.S. Lenders. The Borrower shall not be required to indemnify any Non-U.S. Lender or related Tax Protected Party or to pay any additional amounts to any Non-U.S. Lender or related Tax Protected Party, in respect of United States Federal withholding tax pursuant to  subsections (a)  or  (b)  above to the extent that the obligation to withhold amounts with respect to United States Federal withholding tax existed on the date such Non-U.S. Lender became a party to this Agreement (or, in the case of a participant, on the date such participant acquired its participation interest) or to the extent such obligation to withhold amounts with respect to United States federal withholding tax arises after such date as a
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result of a change in residence, place of incorporation, principal place of business, or office or location in which Loans governed by this Agreement are booked or recorded by such Lender or Tax Protected Party;  provided ,  however , that this  subsection (f) shall not apply (i) to any participant that becomes a participant as a result of an assignment, participation, transfer or designation made at the request of the Borrower or where a change of office or location in which Loans governed by this Agreement are booked or recorded is made at the request of the Borrower and (ii) to the extent the indemnity payment or additional amounts any participant would be entitled to receive (without regard to this  subsection (f) ) do not exceed the indemnity payment or additional amounts that the Person making the assignment, participation or transfer to such participant would have been entitled to receive in the absence of such assignment, participation, transfer or designation.
     (g) Mitigation. If the Borrower is required to pay additional amounts to or for the account of any Tax Protected Party pursuant to this  Section 3.01 , then such Tax Protected Party will agree to use reasonable efforts to eliminate or reduce any such additional payment which may thereafter accrue if such change, in the judgment of such Tax Protected Party, is not otherwise disadvantageous to such Lender.
     (h) Tax Receipts. Within thirty days after the date of any payment of Taxes, the Borrower shall, if requested by the Agent, furnish to the Agent the original or a certified copy of a receipt evidencing such payment (to the extent one is so provided).
     (i) Survival. Without prejudice to the survival of any other agreement of the Borrower hereunder, the agreements and obligations of the Borrower contained in  subsections (a)  through  (h)  above shall survive the payment in full of principal and interest hereunder and under any instrument delivered hereunder.
     (j) Contest. If a claim is made against a Tax Protected Party for any Taxes or Other Taxes (a “Claim”), such Tax Protected Party shall, as promptly as practical after receipt of a written notification of such Claim, give the Borrower written notification of such Claim; provided that the failure to give such notice of a timely basis shall not preclude a Claim for indemnification hereunder. If the Borrower so requests in writing within 30 days after receipt of such notice, the Tax Protected Party shall, at the Borrower’s expense, take any reasonable action to contest such Claim (including having the Borrower control the contest of such Claim if allowable under Applicable Law); provided, however, that the following conditions are met: (i) the contest will not result in any material danger of the sale, forfeiture or loss of the Collateral or any interests therein; (ii) no Default or Event of Default shall have occurred and be continuing; (iii) prior to the commencement of any contest, the Borrower shall have acknowledged its liability for the contested amount (as between it and the Tax Protected Party); and (iv) the Tax Protected Party shall have received a legal opinion (at the Borrower’s expense) from counsel reasonably satisfactory to the Tax Protected Party, as the case may be, indicating that a reasonable basis for such contest exists.
     (k) Refunds. If a Tax Protected Party determines that a refund is due of any Taxes or Other Taxes in either case from the jurisdiction to which such Taxes or Other Taxes were paid and which in the Tax Protected Party’s sole discretion is allocable to amounts with respect to which it has been indemnified by the Borrower hereunder or with respect to which the Borrower
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has paid additional amounts pursuant to this Section 3.01, it shall pay over within the next 30 days the amount of such refund, credit or offset to the Borrower (but only to the extent of indemnity payments made, or additional payments paid, by the Borrower with respect to the Taxes or Other Taxes giving rise to such refund).
     SECTION 3.02 Illegality. If, on or after the date of this Agreement, the adoption of any Applicable Law, or any change in any Applicable Law, or any change in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any Lender with any request or directive (whether or not having the force of law) of any such authority, central bank or comparable agency shall make it unlawful or impossible for any Lender to make, maintain or fund any of its Loans at a rate based upon the Adjusted Eurodollar Rate (such event being hereinafter referred to as an “ Illegality Event ”) and such Lender shall so notify the Agent, the Agent shall forthwith give notice thereof to the other Lenders and the Borrower, whereupon until such Lender notifies the Borrower and the Agent that the circumstances giving rise to such suspension no longer exist, interest on the Loans of such Lender shall accrue and be payable at the Corporate Base Rate. If an Illegality Event does not affect all Lenders, the Agent shall make a good faith effort to cause the Lenders that are not affected by such Illegality Event to purchase the Loans held by the affected Lenders. The foregoing shall not delay or otherwise affect the Borrower’s obligation to pay interest at the Corporate Base Rate as provided in this paragraph.
     SECTION 3.03 Increased Costs and Reduced Return. (a) If, on or after the date hereof, the adoption of or any change in any Applicable Law or in the interpretation or application thereof applicable to any Tax Protected Party, or compliance by any Tax Protected Party with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority, in each case made subsequent to the Effective Date (or, if later, the date on which such Tax Protected Party becomes a Tax Protected Party):
     (i) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of such Tax Protected Party which is not otherwise included in the determination of the Adjusted Eurodollar Rate hereunder; or
     (ii) shall impose on such Tax Protected Party any other condition;
and the result of any of the foregoing is to increase the cost to such Tax Protected Party of making, converting into, continuing or maintaining any Loans or to reduce any amount receivable hereunder in respect thereof (any such increased cost or reduction hereinafter referred to as an “ Increased Cost ”), then, in any such case, upon notice to the Borrower from such Tax Protected Party, through the Agent, in accordance herewith, the Borrower shall be obligated to pay such Tax Protected Party, in accordance with  Section 2.07(c) , any additional amounts necessary to compensate such Tax Protected Party on an after-tax basis (after taking into account applicable deductions and credits in respect of the amount indemnified) for such increased cost or reduced amount receivable.
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     (b) If any Tax Protected Party shall have determined that the adoption or the becoming effective of, or any change in, or any change by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof in the interpretation or administration of, any Applicable Law, regarding capital adequacy, or compliance by such Tax Protected Party, or its parent corporation, with any request or directive regarding capital adequacy (whether or not having the force of law) of any such authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on such Tax Protected Party’s (or parent corporation’s) capital or assets as a consequence of its commitments or obligations hereunder to a level below that which such Tax Protected Party, or its parent corporation, could have achieved but for such adoption, effectiveness, change or compliance (taking into consideration such Tax Protected Party’s (or parent corporation’s) policies with respect to capital adequacy), then, upon notice from such Tax Protected Party to the Borrower, the Borrower shall be obligated to pay to such Tax Protected Party in accordance with  Section 2.07(c) , such additional amount or amounts as will compensate such Tax Protected Party on an after-tax basis (after taking into account applicable deductions and credits in respect of the amount indemnified) for such reduction. Each determination by any such Tax Protected Party of amounts owing under this Section shall, absent manifest error, be conclusive and binding on the parties hereto.
     (c) A certificate of each Tax Protected Party setting forth such amount or amounts as shall be necessary to compensate such Tax Protected Party or its holding company as specified in  subsection (a)  or  (b)  above, as the case may be, shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay each Tax Protected Party the amount shown as due on any such certificate delivered by it on the next succeeding Settlement Date in accordance with  Section 2.07(c) .
     (d) Promptly after any Tax Protected Party becomes aware of any circumstance that will, in its sole judgment, result in a request for increased compensation pursuant to this Section, such Tax Protected Party shall notify the Borrower thereof. Failure on the part of any Tax Protected Party so to notify the Borrower or to demand compensation for any increased costs or reduction in amounts received or receivable or reduction in return on capital with respect to any period shall not constitute a waiver of such Tax Protected Party’s right to demand compensation with respect to such period or any other period. The protection of this Section shall be available to each Tax Protected Party regardless of any possible contention of the invalidity or inapplicability of the law, rule, regulation, guideline or other change or condition which shall have occurred or been imposed.
     SECTION 3.04 Funding Losses. The Borrower shall indemnify each Tax Protected Party against any loss or reasonable expense (but excluding in any event loss of anticipated profit) which such Tax Protected Party may sustain or incur as a consequence of (i) any failure by the Borrower to fulfill on the date of the Borrowing hereunder the applicable conditions set forth in  Article IV , so long as any such failure is not solely due to the failure of the Agent or any Lender to comply with its obligations hereunder in all material respects, (ii) any failure by the Borrower to borrow or to prepay any Loan hereunder after irrevocable notice of such Borrowing, or prepayment has been given pursuant to  Section 2.02  or  2.07 , as applicable, so long as any such failure is not solely due to the failure of the Agent or any Lender to comply with its obligations hereunder in all material respects or (iii) any payment or prepayment of a Loan,
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(including, without limitation, payment or prepayment pursuant to Section 2.08), whether voluntary or involuntary, pursuant to any other provision of this Agreement or otherwise made on a date other than the last day of the Interest Period applicable thereto, so long as any such payment, prepayment or conversion is not solely due to the failure of the Agent or any Lender to comply with its obligations hereunder in all material respects (each such loss or expense, a “ Funding Loss ”). Such Funding Losses shall be determined by each Tax Protected Party in its sole discretion and shall include an amount equal to the excess, if any, as reasonably determined by such Tax Protected Party, of (i) its cost of obtaining the funds for the Loan being paid, prepaid or not borrowed (based on the applicable London Interbank Offered Rate), for the period from the date of such payment, prepayment or failure to borrow to the last day of the then applicable Interest Period (or, in the case of a failure to borrow, the Interest Period for such Loan which would have been applicable to such Loan on the date of such failure to borrow) over (ii) the amount of interest (as reasonably determined by such Tax Protected Party) that would be realized by such Tax Protected Party in reemploying the funds so paid, prepaid or not borrowed or continued for such period or Interest Period, as the case may be. A certificate of any Tax Protected Party setting forth any amount or amounts which such Tax Protected Party is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error.
ARTICLE IV
CONDITIONS
     SECTION 4.01 Conditions to Effectiveness of this Agreement. The obligations of each Committed Lender to make a Loan on the Closing Date is subject to the satisfaction of the following conditions:
     (a) Executed Loan Documents. Receipt by the Agent of duly executed copies of: (i) this Agreement; (ii) the Notes (if requested under  Section 2.04 ); (iii) the Collateral Documents; and (iv) all other Loan Documents, each in form and substance satisfactory to the Agent in its sole discretion.
     (b) Servicing Documents. Receipt by the Agent of a duly executed copy of each Servicing Document, in each case in form and substance satisfactory to the Agent in its sole discretion.
     (c) Due Diligence. The Agent shall have completed, and be satisfied with the results of, its business and legal due diligence review with respect to the Servicer and the Borrower and the transactions contemplated hereby, including, without limitation, a due diligence review of the financial statements, if any, of the Servicer and the Borrower, the tax status of the Servicer and the Borrower and an environmental, employee benefits and insurance due diligence review.
     (d) Customer Collections Account Documents. The Agent shall have received (i) a supplement to the Customer Collections Account Administration Agreement, duly executed by TILC, the Collateral Agent, and the Marks Company Delaware Trustee of the Customer Collections Account Administration Agreement, and
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certified by a Responsible Officer of the Marks Company Delaware Trustee as a true and correct copy thereof and (ii) evidence satisfactory to the Agent that TILC shall have been instructed, and shall have agreed, to remit all payments made by Lessees to the Customer Collections Account in respect of the Portfolio directly to the Depositary in accordance with the terms of the Customer Collections Account Administration Agreement.
     (e) Closing Rating Agency Condition. The Closing Rating Agency Condition has been satisfied.
     SECTION 4.02 Conditions to the Closing Date. The obligation of any Committed Lender to make a Loan on the occasion of the Borrowing on the Closing Date is subject to the prior approval by the Agent (and the Supermajority Lenders, as applicable) at the Borrower’s request to include the applicable Railcars and Leases to be acquired on the Closing Date in the Portfolio in accordance with  Section 2.02 , and to the satisfaction of the following conditions:
     (a) Notice. The Borrower shall have delivered to the Agent an appropriate Notice of Borrowing, duly executed and completed, by the time specified in  Section 2.02 .
     (b) Representations and Warranties. The representations and warranties made by Trinity and each Facility Party in any Transaction Document to which it is a party are true and correct in all material respects at and as if made as of such date except to the extent they expressly relate to an earlier date.
     (c) No Default. No Default, Event of Default, Servicer Event or Servicer Replacement Event shall exist or be continuing either prior to or after giving effect thereto.
     (d) No Amortization Event. Immediately after giving effect to the making of a Loan (and the application of the proceeds thereof), there shall not exist any Amortization Event.
     (e) Purchase Price. The Borrower shall have delivered to the Agent a Purchase Price Certificate, duly executed and completed by a Responsible Officer of each of the Servicer and the Borrower.
     (f) Leases; Additional Collateral Certificate. Subject to the provisions of Section 3.17(h) of the Purchase and Sale Agreement, receipt by the Agent of (i) the originally executed chattel paper counterpart of each Lease applicable to each Railcar which is to become a Portfolio Railcar on the Closing Date, in each case bearing the Chattel Paper Legend and marked as “Counterpart No. 1” or, if the Agent determines in its sole discretion that an originally executed counterpart of a Lease for any such Railcar with such legend and marking does not exist and is not necessary to perfect assignment of such Lease to the Collateral Agent hereunder, an originally executed counterpart of such Lease without such legend and marking; (ii) an originally executed Additional Collateral Certificate with respect to each relevant Railcar and Lease and (iii) any other Lease Documents to which the Borrower is a party (such other Lease Documents may be delivered on a CD-ROM).
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     (g) Recordations and Filings. The Agent shall have received evidence satisfactory to it in its reasonable discretion from the official records of the STB and the Registrar General of Canada (and a legal opinion in form and substance reasonably acceptable to the Agent) that the Security Agreement (or a memorandum thereof) and each applicable Bill of Sale and Security Agreement Supplement (as defined in the Security Agreement) have been registered, recorded or filed for recordation in accordance with Applicable Law. No filings will be made in Mexico.
     (h) Title to the Collateral. The Borrower shall have good and marketable title to each applicable Railcar and good title to all other items of applicable Collateral, free and clear of all Liens created or incurred by it or permitted to exist by it other than Permitted Liens.
     (i) Assignment of Leases and Permits. A duly executed counterpart of any agreement required to establish a perfected first priority Lien in favor of the Collateral Agent, for its benefit and the benefit of the Lenders and each other Protected Party, relating to the Lease of each Railcar being funded on the Closing Date, dated as of the Closing Date, satisfactory in form and substance to the Agent, and evidence from the official records of the STB and the Registrar General of Canada (or a legal opinion in form and substance reasonably acceptable to the Agent) that such agreement (or a memorandum thereof) has been registered, recorded or filed for recordation in accordance with Applicable Law. In addition, the Agent shall have received satisfactory evidence that any Permits needed to make all required payments under each such Lease to the Borrower in Dollars have been obtained and are in full force and effect.
     (j) Acceptance. The Agent shall have received a copy of the certificate of acceptance of each such Railcar signed by a Responsible Officer of the Borrower.
     (k) Marks Company Matters. The Agent shall have received evidence satisfactory to it in its reasonable discretion that the Marks relating to the Railcars to be funded on such date have been added to the separate portfolio of trust assets of the Marks Company referred to in  Section 4.02(x) .
     (l) Funding Package. Receipt of the complete Funding Package for each such Railcar, including Bill of Sales. The Independent Appraisal included within such Funding Package shall be issued and dated within 60 days prior to the proposed Closing Date.
     (m) Eligibility. A Responsible Officer of each of the Servicer and Borrower shall have certified to the Agent and each Lender that (i) each Railcar which is to become a Portfolio Railcar on the Closing Date is an Eligible Railcar and (ii) each Lease which is to become a Portfolio Lease on the Closing Date is an Eligible Lease;
     (n) [Reserved].
     (o) Fees. The Borrower shall have paid, or shall concurrently pay with such funding, the then due and payable fees pursuant to each of the Agent Fee Letter, the Structuring Fee Letter and each Committed Lender Fee Letter and the costs and expenses
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then payable by the Borrower under Section 11.04 of this Agreement to the extent then invoiced or otherwise notified to the Borrower in writing.
     (p) Payoff Letter. A payoff letter from all Persons (if any) holding Liens of record (other than Permitted Liens) on or prior to the Closing Date with respect to any applicable Railcar shall have been delivered to the Agent.
     (q) Concentration Excess Event. Unless waived by the Agent (acting with the consent of the Supermajority Lenders), no Concentration Excess Event has occurred and is continuing as of the Closing Date prior to or occurs after giving effect to the Loans to be made on the Closing Date.
     (r) Other Documents and Action. The Borrower shall deliver to the Agent such other instruments, agreements and documents and take such other action as the Agent may reasonably request in connection with the Loans to be made on the Closing Date.
     (s) TILC Contribution. TILC shall have made or concurrently shall make a cash capital contribution to the Borrower in an amount at least equal to the  sum  of (i) the amount that the aggregate Purchase Price for the Railcars to be added to the Portfolio on the Closing Date exceeds the Loans to be made by the Lenders on the Closing Date related to the purchase of such Railcars,  plus  (ii) an amount equal to the Liquidity Reserve Target Amount.
     (t) Purchase and Sale Agreement. Receipt by the Agent of a duly executed copy of each applicable Purchase and Sale Agreement, in form and substance satisfactory to the Agent in its sole discretion.
     (u) Organization Documents. After giving effect to the transactions contemplated by the Transaction Documents, the ownership, capital, corporate, organizational and legal structure of each Facility Party shall be reasonably satisfactory to the Lenders, and the Agent shall have received: (i) a copy of the Organizational Documents of each Seller, each Facility Party, the Collateral Agent, and the Marks Company, certified as of a recent date by the Secretary of State of its respective state of organization, and a certificate as to the good standing of each Seller, each Facility Party, and the Marks Company, from such Secretary of State, as of a recent date; (ii) a certificate of the Secretary or Assistant Secretary of each Seller, each Facility Party, the Collateral Agent, and the Marks Company dated the Closing Date and certifying (A) that the certificate of formation or articles of incorporation or other Organizational Documents, as applicable, of each Seller, such Facility Party, the Collateral Agent, or the Marks Company, as applicable, have not been amended since the date of the last amendment thereto shown on the related certificate furnished pursuant to  clause (i)  above; (B) that attached thereto is a true and complete copy of the operating agreement or by-laws of each Seller, such Facility Party, the Collateral Agent, or the Marks Company, as applicable, as in effect on the Closing Date and at all times since a date prior to the date of the resolutions described in  clause (C)  below, (C) that attached thereto is a true and complete copy of resolutions duly adopted by the board of directors
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or other governing body of each Seller, such Facility Party, the Collateral Agent, or the Marks Company, as applicable, authorizing the execution, delivery and performance of the Transaction Documents to which it is to be a party and, in the case of the Borrower, the borrowings hereunder, and that such resolutions have not been modified, rescinded or amended and are in full force and effect; and (D) as to the incumbency and specimen signature of each officer executing any Transaction Document or any other document delivered in connection herewith or therewith on behalf of each Seller, such Facility Party, the Collateral Agent, or the Marks Company; (iii) a certificate of another officer as to the incumbency and specimen signature of the Secretary or Assistant Secretary executing the certificate pursuant to  clause (ii)  above; and (iv) such other documents as the Agent or Mayer Brown LLP, counsel for the Agent, may reasonably request.
     (v) Opinions of Counsel. On the Closing Date, the Agent shall have received:
     (i) favorable written opinions (including, without limitation, as to true sale, non-rejection and nonconsolidation matters) of Vedder Price P.C. counsel to the Borrower, the Servicer and each Seller, addressed to the Agent and each Lender, dated the Closing Date, substantially in the form of each of  Exhibits D-1  and  D-4  hereto and covering such additional matters incident to the transactions contemplated hereby as the Agent may reasonably request;
     (ii) a favorable written opinion of in-house counsel to each of the Servicer and each Seller, addressed to the Agent and each Lender, dated the Closing Date, covering such additional matters incident to the transactions contemplated hereby as the Agent may reasonably request;
     (iii) from Morris James LLP, special Delaware counsel to the Borrower, opinions addressed to the Agent and each Lender, dated the Closing Date, substantially in the form of  Exhibit D-3  hereto and covering such additional matters incident to the transactions contemplated hereby as the Agent may reasonably request;
     (iv) from Morris James LLP, special Delaware counsel to Wilmington Trust Company, an opinion addressed to the Agent and each Lender, dated the Closing Date, substantially in the form of  Exhibit D-8  hereto and covering such additional matters incident to the transactions contemplated hereby as the Agent may reasonably request;
     (v) from special STB counsel to the Borrower, oral or email confirmation that no liens exist on the applicable Railcars and Leases to be acquired by the Borrower on the Closing Date which would have a priority over the liens granted to the Collateral Agent on the Closing Date (within three (3) Business Days of the Closing Date, the Borrower shall procure an opinion addressed to the Agent and each Lender, dated the Closing Date, substantially in the form of  Exhibit D-5  hereto and covering such additional matters incident to the transactions contemplated hereby as the Agent may reasonably request);
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     (vi) from special Canadian counsel to the Agent, oral or email confirmation that no liens exist on the applicable Railcars and Leases to be acquired by the Borrower on the Closing Date which would have a priority over the liens granted to the Collateral Agent on the Closing Date (within three (3) Business Days of the Closing Date, the Borrower shall procure an opinion addressed to the Agent and each Lender, dated the Closing Date, substantially in the form of  Exhibit D-6  hereto and covering such additional matters incident to the transactions contemplated hereby as the Agent may reasonably request);
     (vii) from special counsel to the Marks Company, an opinion addressed to the Agent and each Lender, dated the Closing Date, substantially in the form of  Exhibit D-7  hereto and covering such additional matters incident to the transactions contemplated hereby as the Agent may reasonably request.
     (w) Perfection of Security Interests; Search Reports. On or prior to the Closing Date, the Agent shall have received:
     (i) a Perfection Certificate from each Facility Party, such Perfection Certificate and all information set forth therein to be correct and complete in all respects;
     (ii) appropriate financing statements (Form UCC-1 or such other financing statements or similar notices as shall be required by local law) fully executed for filing under the Uniform Commercial Code or other applicable local law of each jurisdiction in which the filing of a financing statement or giving of notice may be required, or reasonably requested by the Agent, to perfect the security interests intended to be created by the Collateral Documents;
     (iii) all of the Marks Company Interests issued or to be issued to the Borrower on or prior to the Closing Date, which Marks Company Interests shall be in suitable form for transfer by delivery or shall be accompanied by duly executed instruments of transfer or assignment in blank, with signatures appropriately guaranteed, accompanied in each case by any required transfer tax stamps, all in form and substance satisfactory to the Agent;
     (iv) all of the membership interests of the Borrower issued or to be issued to TILC on or prior to the Closing Date, which membership interests shall be in suitable form for transfer by delivery or shall be accompanied by duly executed instruments of transfer or assignment in blank, with signatures appropriately guaranteed, accompanied in each case by any required transfer tax stamps, all in form and substance satisfactory to the Agent;
     (v) copies of reports from CT Corporation Service System or other independent search service reasonably satisfactory to the Agent listing all effective financing statements that name the Borrower or any other Facility Party, as such (under its present name and any previous name and, if requested by the Collateral Agent, under any trade names), as debtor or seller that are filed in the
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jurisdictions wherein such filing would be effective to perfect a Lien in the Collateral or any portion thereof, together with copies of such financing statements (none of which shall cover the Collateral except to the extent evidencing Permitted Liens or for which the Agent shall have received termination statements (Form UCC-3 or such other termination statements as shall be required by local law) fully executed for filing); and
     (vi) evidence of the completion of all other filings and recordings of or with respect to the Collateral Documents, including, without limitation, all filings and recordings specified in Schedule 3.02 to the Security Agreement, and of all other actions as may be necessary or, in the opinion of the Agent, desirable to perfect the security interests intended to be created by the Collateral Documents.
     (x) Marks Company Documents. The Agent shall have received (i) evidence satisfactory to the Agent that the UTI Trustee under the Marks Company Trust Agreement shall have identified and allocated or caused to be identified and allocated on the books and records of the Marks Company a separate portfolio of trust assets consisting of all of the Marks relating to Portfolio Railcars and all rights of the Marks Company with respect thereto, including, without limitation, the right to payment of Railroad Mileage Credits, and that the Marks Company Delaware Trustee shall have executed and delivered to the Borrower on behalf of the Marks Company a certificate evidencing such special unit of beneficial interests, (ii) a supplement to the Marks Company Trust Agreement, duly executed by TILC and the Marks Company Delaware Trustee, and certified by a Responsible Officer of the Marks Company Delaware Trustee as a true and correct copy thereof, creating the special unit of beneficial interests referred to in  clause (ii)  above and containing such other provisions as the Agent reasonably may request and (iii) evidence satisfactory to the Agent that TILC, as servicer of the Marks Company, shall have been instructed, and shall have agreed, to remit all receipts in respect of the trust assets allocated to the special unit of beneficial interests referred to in clauses (i)  and  (ii)  above directly to the Depositary in accordance with the Marks Company Servicing Agreement.
     (y) Evidence of Insurance. Receipt by the Agent of copies of insurance policies or certificates of insurance of the Borrower evidencing liability and casualty insurance meeting the requirements set forth in the Loan Documents, including, but not limited to, naming the Collateral Agent as additional insured and sole loss payee on behalf of the Lenders.
     (z) Consents and Approvals. On the Closing Date, all necessary governmental (domestic or foreign), regulatory and third party approvals in connection with the transactions contemplated by the Transaction Documents and otherwise referred to herein or therein shall have been obtained and remain in full force and effect.
     (aa) Material Adverse Effect. There shall not have occurred since December 31, 2007 any development or event relating to or affecting Trinity or a Facility Party which has had or could be reasonably expected to have a Material Adverse Effect.
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     (bb) Litigation; Judgments. On the Closing Date, there shall be no actions, suits, proceedings or investigations pending or threatened (i) with respect to this Agreement or any other Transaction Document or the transactions contemplated hereby or thereby, (ii) against the Borrower or (iii) against Trinity, the Servicer or the Marks Company and which the Agent shall determine could reasonably be expected to have a Material Adverse Effect. Additionally, there shall not exist any judgment, order, injunction or other restraint issued or filed or a hearing seeking injunctive relief or other restraint pending or notified prohibiting or imposing materially adverse conditions upon the consummation of the transactions contemplated by the Transaction Documents and otherwise referred to herein or therein.
     (cc) Solvency Certificate. On or prior to the Closing Date, the Borrower shall have delivered or caused to be delivered to the Agent a solvency certificate duly executed by a Responsible Officer of the Borrower, in form and substance satisfactory to the Agent, setting forth the conclusions that, after giving effect to the consummation of all financings contemplated herein, the Borrower will be Solvent.
     (dd) Financial Information. The Agent shall be reasonably satisfied that the financial statements referred to in Section 5.05 are not materially inconsistent with the financial information most recently delivered to the Agent prior to the Closing Date.
     (ee) [Reserved].
     (ff) Counsel Fees. The Agent shall have received full payment of the fees and expenses of Mayer Brown LLP described in Section 11.04  which are billed through the Closing Date.
     (gg) Railcar Portfolio CD-ROM. On or prior to the Closing Date, the Borrower shall have delivered or caused to be delivered to the Agent the Railcar Portfolio CD-ROM.
     (hh) Officer’s Certificate. The Agent shall have received a certificate, dated the Closing Date and duly executed by a Responsible Officer of each of the Servicer and the Borrower, confirming compliance with the conditions precedent set forth in  paragraphs (b) ,  (c) ,  (d) ,  (f) ,  (h) ,  (m) ,  (q)  and  (s)  of  Section 4.02 , and confirming that the Purchase Price of each Railcar to be added to the Portfolio is equal to the fair market value of such Railcar determined by an Independent Appraiser on the basis of a current (within sixty (60) days of the Closing Date) “desktop appraisal.”
     All corporate and legal proceedings and instruments and agreements relating to the transactions contemplated by this Agreement and the other Transaction Documents or in any other document delivered in connection herewith or therewith shall be satisfactory in form and substance to the Agent and its counsel, and the Agent shall have received all information and copies of all documents and papers, including records of corporate proceedings, governmental approvals, good standing certificates and bring-down certificates, if any, which the Agent reasonably may have requested in connection therewith, such documents and papers where appropriate to be certified by proper corporate or Governmental Authorities. The documents
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referred to in this Section 4.02 shall be delivered to the Agent no later than the Closing Date. The certificates referred to in this Section 4.02  shall be dated the Closing Date.
     Promptly after the Closing Date occurs, the Agent shall notify the Borrower and the Committed Lenders of the Closing Date, and such notice shall be conclusive and binding on all parties hereto. If the Closing Date does not occur before 5:00 P.M. on the Commitment Termination Date, the Commitments shall terminate at the close of business on such date and all unpaid fees accrued to such date shall be due and payable on such date.
     The delivery of the Notice of Borrowing shall constitute a representation and warranty by the Borrower of the correctness of the matters specified in  subsections (b) ,  (c) ,  (d) ,  (h) ,  (q)  and  (s)  above.
     The documents referred to in this Section 4.02 shall be delivered to the Agent no later than the Closing Date. The certificates and opinions referred to in this Section shall be dated the Closing Date.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
     The Borrower represents and warrants that:
     SECTION 5.01 Organization and Good Standing. The Borrower is a limited liability company duly formed, validly existing and in good standing under the laws of the jurisdiction of its formation, has all powers and all material governmental business authorizations, consents and approvals required to carry on its business as now conducted and is duly qualified as a foreign limited liability company, licensed and in good standing in each jurisdiction where qualification or licensing is required by the nature of its business or the character and location of its property, business or customers and in which the failure to so qualify or be licensed or in good standing, as the case may be, in the aggregate, could have a Material Adverse Effect.
     SECTION 5.02 Power; Authorization; Enforceable Obligations. The Borrower has the corporate or other necessary power and authority, and the legal right to execute, deliver and perform the Transaction Documents to which it is a party and to obtain extensions of credit hereunder, and has taken all necessary corporate or other action to authorize the borrowings and other actions on the terms and conditions of this Agreement and to authorize the execution, delivery and performance by it of the Transaction Documents to which it is a party. No consent, approval, licenses, validation or authorization of, filing, recording or registration with, notice to, exemption by or other similar act by or in respect of, any Governmental Authority or any other Person (including, without limitation, any stockholder, certificateholder or creditor of any Facility Party or any of their respective Affiliates) is required to be obtained or made by or on behalf of the Borrower in connection with the Borrowing or other extensions of credit hereunder, the execution, delivery, performance, validity or enforceability by or against it of the Transaction Documents or the exercise of the rights and remedies of the Agent, the Collateral Agent or any other Protected Party pursuant to this Agreement or any other Loan Document, except for
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(i) consents, authorizations, notices and filings disclosed in Schedule 5.02, all of which have been obtained or made, (ii) filings to perfect and maintain the perfection of the Liens created by the Collateral Documents and (iii) consents, authorizations, notices and filings in connection with the disposal of Collateral required by laws affecting the offering and sale of securities. This Agreement has been, and each other Transaction Document to which the Borrower Party is a party will be, duly executed and delivered on behalf of the Borrower. This Agreement constitutes, and each other Transaction Document to which the Borrower is a party when executed and delivered will constitute, a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by equitable principles of general applicability (regardless of whether enforcement is sought by proceedings in equity or at law).
     SECTION 5.03 No Conflicts. Neither the execution and delivery by the Borrower of the Transaction Documents to which it is a party, nor the consummation of the transactions contemplated therein, nor performance of and compliance with the terms and provisions thereof by the Borrower, nor the exercise of remedies by the Agent or the Collateral Agent under the Loan Documents, will (i) violate or conflict with any provision of the Borrower’s Organization Documents, (ii) violate, contravene or conflict with any Applicable Law (including Regulation U or Regulation X), (iii) violate, contravene or conflict with any Contractual Obligation to which the Borrower is a party or by which the Borrower may be bound, or (iv) result in or require the creation of any Lien (other than the Lien of the Collateral Documents) upon or with respect to the properties of the Borrower.
     SECTION 5.04 No Default. The Borrower is not, and to the Knowledge of the Borrower, no other Facility Party is in default in any respect under any Contractual Obligation to which it is a party or by which any of its properties is bound, in each case which default has had or could reasonably be expected to have a Material Adverse Effect. No Default, Servicer Event, Servicer Replacement Event or Event of Default has occurred and is continuing.
     SECTION 5.05 Financial Condition. (a) Audited Financial Statements. The audited consolidated balance sheet of TILC and its consolidated Subsidiaries as of December 31, 2007 and the related consolidated statements of income and cash flow for the fiscal year then ended, reported on by TILC’s independent auditors, copies of which have been delivered to each of the Lenders, fairly present, in conformity with GAAP, the consolidated financial position of TILC and its consolidated Subsidiaries as of such date and their consolidated results of operations and cash flow for such fiscal year.
     (b) Material Changes. During the period from December 31, 2007 to and including the Closing Date, there has been no sale, transfer or other disposition by TILC or any of its consolidated Subsidiaries of any material part of the business or property of TILC and its consolidated Subsidiaries, in each case taken as a whole, and no purchase or other acquisition by them of any business or property (including any Equity Interests of any other Person) material in relation to the consolidated financial condition of TILC and its consolidated Subsidiaries, as applicable, taken as a whole, which is not reflected in the foregoing financial statements or in the notes thereto. The balance sheets and the notes thereto included in the financial statements referred to in  subsection (a)  above disclose all liabilities, actual or contingent, of TILC and its
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consolidated Subsidiaries as of the date thereof required to be disclosed therein in accordance with GAAP.
     (c) Post-Closing Financial Statements. The financial statements to be delivered to the Lenders pursuant to Section 6.01(a) and (b) , if any, (i) will have been prepared in accordance with GAAP (except as may otherwise be permitted under  Section 6.01(a) and  (b) ) and (ii) will present fairly (on the basis disclosed in the footnotes to such financial statements, if any) the consolidated financial condition, results of operations and cash flow of TILC and its consolidated Subsidiaries as of the respective dates thereof and for the respective periods covered thereby.
     (d) No Undisclosed Liabilities. Except as set forth in the financial statements described in subsection (a) and (b) above, and the Debt incurred under this Agreement, (i) there were as of the Closing Date (and after giving effect to any Loans made on such date) no material liabilities or obligations (excluding current obligations incurred in the ordinary course of business) with respect to the Borrower, or, to the Knowledge of the Borrower, the other Facility Parties of any nature whatsoever (whether absolute, accrued, contingent or otherwise and whether or not due and including obligations or liabilities for taxes, long-term leases and unusual forward or other long-term commitments), and (ii) there is no basis for the assertion against the Borrower, or, to the Knowledge of the Borrower, the other Facility Parties, of any such liability or obligation which, either individually or in the aggregate, are or could reasonably be expected to have, a Material Adverse Effect.
     SECTION 5.06 No Material Change. Since December 31, 2007 there has been no Material Adverse Effect, and no event or development has occurred which could reasonably be expected to result in a Material Adverse Effect.
     SECTION 5.07 Title to Properties.
     (a) On the Closing Date and during the term of this Agreement, the Borrower shall be the sole legal and beneficial owner of and shall have good and marketable title to each Portfolio Railcar and Portfolio Lease and all of its other material properties and assets, except, in the case of assets other than Portfolio Railcars and Portfolio Leases, for minor defects in title that do not interfere with its ability to conduct its business as currently conducted. All such Portfolio Railcars and Portfolio Leases and other material properties and assets are and will be free and clear of Liens other than Permitted Liens.
     (b) Unless otherwise disclosed to the Agent in writing prior to its purchase by the Borrower, Trinity or its Affiliates continuously owned each Portfolio Railcar and related Portfolio Lease at all times since such Railcar’s manufacture and prior to the purchase of such Railcar by the Borrower.
     SECTION 5.08 Litigation. There are no actions, suits, investigations or legal, equitable, arbitration or administrative proceedings pending or overtly threatened (or any basis therefor of which the Borrower has Knowledge) against or affecting the Borrower, or, to the Knowledge of the Borrower, affecting any other Facility Party that (i) involve any Transaction Document or (ii) could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.
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     SECTION 5.09 Taxes. The Borrower, and to the Knowledge of the Borrower, the other Facility Parties have filed, or caused to be filed, all tax returns (including federal, state, local and foreign tax returns) the failure of which to be filed could reasonably be expected to result in a Material Adverse Effect and paid (i) all amounts of taxes shown thereon to be due (including interest and penalties) and (ii) all other material taxes, fees, assessments and other governmental charges (including mortgage recording taxes, documentary stamp taxes and intangible taxes) owing by it, except for such taxes (A) which are not yet delinquent or (B) that are being contested in good faith and by proper proceedings diligently pursued, and against which adequate reserves are being maintained in accordance with GAAP. To the Knowledge of the Borrower, there is no pending investigation of the Borrower or any other Facility Party by any taxing authority or proposed tax assessments against the Borrower or any other Facility Party.
     SECTION 5.10 Compliance with Law. The Borrower, and to the Knowledge of the Borrower, each other Facility Party, is in compliance with all requirements of Applicable Law (including Environmental Laws) applicable to it or to its properties, except where such failures to comply could not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect. Neither the Borrower, nor any of its material properties or assets, nor, to the Knowledge of the Borrower, the other Facility Parties or any of their respective material properties or assets, is or are subject to or in default with respect to any judgment, writ, injunction, decree or order of any court or other Governmental Authority, except where such defaults could not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect. Neither the Borrower, nor to the Knowledge of the Borrower, any other Facility Party, has received any written communication from any Governmental Authority that alleges that it is not in compliance in any material respect with any Applicable Law, except for allegations that have been satisfactorily resolved and are no longer outstanding or which could not reasonably be expected to have a Material Adverse Effect.
     SECTION 5.11 Subsidiaries. The Borrower has no Subsidiaries other than any Railcar Subsidiaries set forth on Schedule 5.11 .
     SECTION 5.12 Governmental Regulations, Etc. (a) The Borrower is not engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying “margin stock” within the meaning of Regulation U. No proceeds of the Loans will be used, directly, or indirectly, for the purpose of purchasing or carrying any “margin stock” within the meaning of Regulation U. If requested by any Lender or the Agent, the Borrower will furnish to the Agent and each Lender a statement to the foregoing effect in conformity with the requirements of FR Form U-1 referred to in Regulation U. “Margin stock” within the meaning of Regulation U does not constitute more than 25% of the value of the assets of the Borrower. None of the transactions contemplated by this Agreement (including the direct or indirect use of the proceeds of the Loans) will violate or result in a violation of the Securities Act, as amended, the Exchange Act or regulations issued pursuant thereto, or Regulation T, U or X.
     (b) The Borrower is not subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act or the Investment Company Act of 1940, each as amended. In addition, the Borrower is not (i) an “investment company” registered or required to be registered under the Investment Company Act of 1940, as amended, (ii) controlled by such a
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company, or (iii) a “holding company”, a “subsidiary company” of a “holding company”, or an “affiliate” of a “holding company” or of a “subsidiary” of a “holding company”, within the meaning of the Public Utility Holding Company Act of 1935, as amended.
     SECTION 5.13 Purpose of Loans. The proceeds of the Loans made on the Closing Date will be used solely to fund the Purchase Price of Eligible Railcars and related Eligible Leases added to the Portfolio on the Closing Date and to pay fees and expenses incurred in connection therewith.
     SECTION 5.14 Environmental Matters. The Borrower has complied with all applicable Environmental Laws, and to the Knowledge of the Borrower, each other Facility Party has complied in all respects with all applicable Environmental Laws, except where the failure to comply could not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect. The Borrower has not, and to the Knowledge of the Borrower no other Facility Party has, incurred any liability under any Environmental Laws, received written notice of any actual or claimed or asserted failure to comply with Environmental Laws which alone, or together with any other such liability or notices which have been previously or concurrently received, could reasonably be expected to result in a Material Adverse Effect, other than in connection with failures which have been corrected. No hazardous wastes, hazardous substances, hazardous materials, toxic substances or toxic pollutants, as those terms are used in any Environmental Laws, are managed on any property of the Borrower, or to the Knowledge of the Borrower of any other Facility Party, in violation of any regulations promulgated pursuant thereto or any other Applicable Law, except as could not reasonably be expected to result in a Material Adverse Effect.
     SECTION 5.15 Intellectual Property. The Borrower owns, or possesses the right to use, all of the Marks, trademarks, service marks, trade names, copyrights, patents, patent rights, franchises, licenses and other rights that are reasonably necessary for the operation of its business, without conflict with the rights of any other Person. To the Knowledge of the Borrower, no slogan or other advertising devise, product, process, method, substance, part or other material now employed, or now contemplated to be employed, by the Borrower infringes upon any rights held by any other Person. No claim or litigation regarding any of the foregoing is pending or overtly threatened, and no patent, invention, device, application, principle or any statute, law, rule, regulation, standard or code is pending or, to the Knowledge of the Borrower, proposed, which, in either case, could reasonably be expected to have a Material Adverse Effect.
     SECTION 5.16 Solvency. The Borrower is and, after consummation of the transactions contemplated hereby and by the other Transaction Documents and Lease Documents, will be Solvent.
     SECTION 5.17 Disclosure. No statement, information, report, representation, or warranty made by the Borrower in any Transaction Document or furnished to the Agent or any Lender by or on behalf of the Borrower in connection with any Transaction Document (considered together with all other such information so furnished) contains any untrue statement of a material fact or omits any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
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     SECTION 5.18 Security Documents. (a) The Security Agreement is effective to create in favor of the Collateral Agent, for the ratable benefit of the Protected Parties, a legal, valid and enforceable “first” priority security interest in the Collateral and, when the filings, recordations or other actions described in Section 3.02 of the Security Agreement and Section 3.06 of the Parent Security Agreement shall have been completed, the Security Agreement shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the grantors thereunder in the Collateral, in each case to the extent provided in such Section 3.02 of the Security Agreement and Section 3.06 of the Parent Security Agreement.
     (b) The Collateral Agent, for the ratable benefit of the Protected Parties, will at all times have the Liens provided for in the Collateral Documents and, subject to the filing by the Agent of continuation statements to the extent required by the Uniform Commercial Code, the Collateral Documents will at all times constitute valid and continuing liens of record and a “first” priority perfected security interest in all the Collateral referred to therein, except as priority may be affected by Permitted Liens.
     SECTION 5.19 Ownership. Trinity owns good, valid and marketable title to all the outstanding common stock of TILC. TILC owns good, valid and marketable title to all outstanding equity interests of the Borrower, free and clear of all Liens of every kind, whether absolute, matured, contingent or otherwise, and TILC owns good, valid and marketable title to all outstanding beneficial interests of the Marks Company, free and clear of all Liens of every kind (other than Liens encumbering SUBI Certificates issued by the Marks Company which do not relate to Marks applicable to any Portfolio Railcar), whether absolute, matured, contingent or otherwise.
     SECTION 5.20 Lease Documents. The Borrower has delivered or caused to be delivered (i) to the Collateral Agent, to the extent required under  Section 4.02(f) , the original executed counterpart bearing the Chattel Paper Legend and marked as “Counterpart No. 1” of the Portfolio Leases (or such other original executed counterpart as is accepted by the Agent) and any other Lease Documents to which the Borrower is a party (such other Lease Documents may be delivered on a CD-ROM) and (ii) to the Lenders true and complete copies of the Leases and any amendments or supplements thereto to which the Borrower is a party, and, except for amendments so disclosed to the Agent and the Lenders, such documents have not been amended or modified.
     SECTION 5.21 Sole Business of the Borrower. The sole business of the Borrower is the ownership, leasing and financing of Railcars. The Borrower has not engaged in any activities since its organization (other than those incidental to its organization and other appropriate steps and arrangement for the payment of fees to, and director’s and officer’s insurance for, the officers and directors of the Borrower, the acquisition and leasing of the Portfolio Railcars and the funding of the Purchase Price thereof, the authorization and issuance of the Notes, the execution of this Agreement, and the other Transaction Documents and the Lease Documents to which it is a party and the activities referred to in or contemplated by such agreements), and the Borrower has not paid any dividends or other distributions since its organization, except as permitted pursuant to  Section 7.07 hereof.
     SECTION 5.22 Separate Corporate Structure; No Employees.
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     (i) The Borrower is operated as a separate legal entity from Trinity, the Servicer and their Affiliates (other than the Borrower) and will observe all corporate formalities necessary to remain a legal entity separate and distinct from, and independent of, Trinity, the Servicer and their Affiliates (other than the Borrower).
     (ii) The Borrower has satisfied the minimum capitalization requirements, if any, under the laws of the State of Delaware for purposes of conducting its business.
     (iii) The Borrower has complied in all respects with the requirements set forth in its Organization Documents.
     (iv) The Borrower currently corresponds with all third parties with regard to its business on stationery with letterhead identifying it and containing no reference to Trinity, the Servicer or their Affiliates (other than the Borrower).
     (v) The Borrower keeps complete and accurate entity records, books, accounts and minutes separate from those of Trinity, the Servicer and any of their Affiliates (other than the Borrower) or any other Person.
     (vi) The Borrower has held itself out to the public (including to creditors of the Borrower, Trinity, the Servicer and their Affiliates) under the its own name as a separate and distinct entity.
     (vii) The Borrower has not directly or indirectly entered into any transaction with Trinity, the Servicer or any of their Affiliates except as expressly permitted by the Loan Documents and then in an arm’s-length bargain.
     (viii) The Borrower has not loaned funds to, guaranteed or become obligated with respect to claims against, Trinity, the Servicer or any of their Affiliates (other than the Borrower) or any other Person or entity except as expressly permitted by the Loan Documents or as provided by operation of consolidated group principles of U.S. federal income tax and ERISA laws.
     (ix) The Borrower has kept its assets and liabilities as reflected in its books and records separate from those of Trinity, the Servicer and their Affiliates (other than the Borrower) and has not and at all times will not commingle such assets and liabilities (except as expressly permitted pursuant to this Agreement).
     (x) The Borrower has kept adequate records to permit the segregation of its assets and liabilities from those of Trinity, the Servicer and their Affiliates (other than the Borrower).
     (xi) The Borrower has not held itself out to the public as a division of Trinity or the Servicer, or Trinity or the Servicer as a division of the Borrower.
     (xii) The Borrower has not induced third parties to rely on the creditworthiness of Trinity or the Servicer in order to have third parties enter into contracts with the Borrower.
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     (xiii) The Borrower has and will pay its obligations in the ordinary course of business as a legal entity separate and distinct from Trinity, the Servicer and their Affiliates (other than the Borrower).
     (xiv) The Borrower has and will keep its funds separate and distinct from any funds of Trinity, the Servicer and their Affiliates (other than the Borrower) (except as permitted by the Customer Collections Account Administration Agreement and except for misdirected Lease payments), and will receive, deposit, withdraw and disburse such funds separate from any funds of Trinity, the Servicer and their Affiliates (other than the Borrower).
     (xv) The Borrower does not have any employees.
     (xvi) The Borrower is otherwise in compliance with the corporate governance and other factual assumptions applicable to it set forth in the “nonconsolidation” opinion delivered by Vedder Price P.C. on the Closing Date.
     SECTION 5.23 Leases. (i) Each Portfolio Lease was an Eligible Lease as of the date of such Portfolio Lease was added to the Portfolio, (ii) as of the date of the Monthly Report most recently delivered to the Agent and the Lenders in accordance with Section 6.01(f) , except as otherwise disclosed in writing by the Borrower to the Agent, no Lease Event of Default to the Knowledge of the Borrower after due inquiry is in existence under any Portfolio Lease and each Portfolio Lease is in full force and effect and (iii) the description of each Lease Event of Default occurring under a Lease, if any, included in a Request and any supplement thereto accurately describes in all material respects each Lease Event of Default during the periods described of which the Borrower is aware after due inquiry as of the Closing Date.
     SECTION 5.24 Railcars. Each Portfolio Railcar was an Eligible Railcar as of the date of such Portfolio Railcar was added to the Portfolio.
ARTICLE VI
AFFIRMATIVE COVENANTS
     The Borrower agrees that so long as any Lender has any Commitment hereunder or any Obligation or other amount payable hereunder or under any Note or other Loan Document remains unpaid:
     SECTION 6.01 Information. The Borrower will furnish, or cause to be furnished, to the Agent (and to the Derivatives Creditors, with respect to Monthly Reports, Notices pursuant to Section 6.01(g), and other information described in Section 6.01(i) that a Derivatives Creditor may reasonably request):
     (a) Annual Financial Statements. As soon as available, and in any event within 150 days after the end of each fiscal year of each of the Borrower and TILC, a consolidated balance sheet and income statement of each of the Borrower and TILC and their respective consolidated Subsidiaries, as of the end of such fiscal year, and the related consolidated statements of operations and retained earnings and cash flow for
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such fiscal year, setting forth in comparative form figures for the preceding fiscal year, all such financial statements to be in reasonable form and detail and audited by TILC’s independent public accountants and accompanied by an opinion of such accountants (which shall not be qualified or limited in any material respect) to the effect that such financial statements have been prepared in accordance with GAAP and present fairly the consolidated financial position and results of operations and cash flow of each of the Borrower and TILC and their respective consolidated Subsidiaries in accordance with GAAP consistently applied (except for changes with which such accountants concur).
     (b) Quarterly Financial Statements. As soon as available, and in any event within 90 days after the end of each of the first three fiscal quarters in each fiscal year of each of the Borrower and TILC, a consolidated balance sheet of each of the Borrower and TILC and their respective consolidated Subsidiaries as of the end of such fiscal quarter, together with related consolidated statements of operations and retained earnings and cash flow for such fiscal quarter and the then elapsed portion of such fiscal year, setting forth in comparative form figures for the corresponding periods of the preceding fiscal year, all such financial statements to be in form and detail and reasonably acceptable to the Agent, and accompanied by a certificate of the chief financial officer of the Borrower or TILC, as applicable, to the effect that such financial statements have been prepared in accordance with GAAP and present fairly in all material respects the consolidated financial position and results of operations and cash flow of each of the Borrower and TILC in accordance with GAAP consistently applied, subject to changes resulting from normal year-end audit adjustments and the absence of footnotes required by GAAP.
     (c) Officer’s Certificate. At the time of delivery of the financial statements provided for in Sections 6.01(a) and 6.01(b)  above, a certificate duly executed by a Responsible Officer of each of the Borrower and the Servicer (i) demonstrating compliance with the financial covenants contained in  Section 7.12  by calculation thereof as of the end of the fiscal period covered by such financial statements and (ii) stating that, to the Knowledge of each of the Borrower and the Servicer, no Default, Servicer Event, Servicer Replacement Event or Event of Default exists, or if any Default, Servicer Event, Servicer Replacement Event or Event of Default does exist, specifying the nature and extent thereof and what action the Borrower and/or the Servicer proposes to take with respect thereto.
     (d) [Reserved].
     (e) Notices Regarding Collateral. Promptly upon receipt from any Manufacturer, the Servicer, any Lessee or any Lessee’s insurance carrier or broker, copies of any material notice, communication, document or agreement related to any Portfolio Railcar or other Collateral. Promptly upon a Responsible Officer of the Borrower or the Servicer obtaining Knowledge thereof, notice of Liens with respect to any Portfolio Railcar other than Permitted Liens.
     (f) Monthly Report. Not later than the second Business Day prior to each Settlement Date a Monthly Report setting forth the information contained in such Monthly Report for the Measuring Period ending most recently prior to such date
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(provided that if and to the extent such information is available only from a Lessee or the Agent, the Borrower’s obligation to provide such information shall be limited to providing such information as the Borrower or Servicer is able to obtain from the Agent and such Lessee through commercially reasonable efforts to enforce applicable provisions of the applicable Lease), including a complete list showing the make, manufacturer, model, car number and Mark of each Portfolio Railcar and each Lease with respect thereto, together with an executed and fully completed officer’s certificate substantially in the form of  Exhibit L-2  hereto (if expenses are to be reimbursed to the Servicer as described in such certificate). The Agent shall review the Monthly Report and, in its sole discretion, provide the Borrower with any corrections or supplemental information regarding the Loans or amounts paid into or held in the Accounts, which corrections and/or information the Borrower shall include in a revised Monthly Report. The Agent shall provide the Lenders and the Derivatives Creditors with a copy of the Monthly Report, as revised pursuant to the preceding sentence.
     (g) Notices. Prompt notice of: (i) the occurrence of any Default, Servicer Event, Servicer Replacement Event or Event of Default; (ii) the occurrence of any Lease Event of Default; and (iii) any matter that has resulted or could reasonably be expected to result in a Material Adverse Effect, including: (A) breach or non-performance of, or any default under, a Contractual Obligation of any Facility Party; (B) any dispute, litigation, investigation or proceeding between any Facility Party and any Governmental Authority; (C) any litigation, investigation or proceeding affecting any Facility Party in which the amount involved exceeds $10,000,000, or in which injunctive relief or similar relief is sought, which relief, if granted, could be reasonably expected to have a Material Adverse Effect; and (D) any material change in accounting policies or financial reporting practice by the Borrower. Each notice pursuant to this  Section 6.01(g)  shall (x) be accompanied by a statement of a Responsible Officer of each of the Borrower and the Servicer setting forth details of the occurrence referred to therein and stating what action each Facility Party has taken and proposes to take with respect thereto and (y) if applicable, describe with particularity any and all provisions of this Agreement or the other Loan Documents that have been breached.
     (h) Domestication in Other Jurisdiction. Not less than 30 days prior to any change in the form or jurisdiction of organization of the Borrower, a copy of all documents and certificates intended to be filed or otherwise executed to effect such change.
     (i) Other Information. With reasonable promptness upon request therefor, such other information regarding the business, properties or financial condition of any Facility Party as the Agent may reasonably request.
     SECTION 6.02 Preservation of Existence and Franchises; Authorizations, Approvals and Recordations. The Borrower will do all things necessary to preserve the legality, validity, binding effect or enforceability of this Agreement, the Notes or any other Lease Document or Transaction Document, or permit the making of any payment or the transfer or remittance of any funds by the Borrower under this Agreement, the Notes or any other Lease Document or Transaction Document.
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     SECTION 6.03 Books and Records. The Borrower will keep complete and accurate books and records of its transactions in accordance with good accounting practices on the basis of GAAP (including the establishment and maintenance of appropriate reserves) and shall keep full and accurate books relating to the Collateral, including, but not limited to, the originals of all documentation with respect thereto (other than original executed copies of the Portfolio Leases delivered to the Agent or its nominee under the Loan Documents), all credits granted thereon, all merchandise returned and all other dealings therewith, and the Borrower will make the same available to the Agent for inspection, at the Borrower’s own cost and expense, as provided in  Section 6.11(a) . Upon direction of the Agent, the Borrower shall stamp or otherwise mark such books and records in such manner as the Agent may reasonably require in order to reflect the Security Interests. The Borrower will keep, or, with respect to the Portfolio Railcars and the Portfolio Leases, cause the Servicer to keep, at all times books of record and account adequate to identify the Portfolio Railcars and Portfolio Leases and to locate the Portfolio Railcars and Portfolio Leases and, to the extent that the Lessee is required to provide such information pursuant to the applicable Portfolio Lease, to disclose its use, maintenance, condition and the income generated to the Borrower through the use thereof, in which full, true and correct entries will be made.
     SECTION 6.04 ERISA. The Borrower will not maintain or otherwise be or become liable or contingently liable in respect of any Pension Plan or Multiemployer Plan (as defined under Section 3(37)(A) of ERISA).
     SECTION 6.05 Payment of Taxes and Other Debt. The Borrower will pay and discharge (i) all material taxes, assessments and other governmental charges or levies imposed upon it, or upon its income or profits, or upon any of its properties, before they shall become delinquent, (ii) all lawful claims (including claims for labor, materials and supplies) which, if unpaid, might give rise to a Lien upon any of the Collateral and (iii) all of its other Debt as it shall become due;  provided ,  however , that the Borrower shall not be required to pay any such tax, assessment, charge, levy, claim or Debt which is being contested or negotiated in good faith by appropriate proceedings diligently pursued and as to which adequate reserves have been established in accordance with GAAP, unless the failure to make any such payment could reasonably be expected to have a Material Adverse Effect.
     SECTION 6.06 Insurance; Certain Proceeds; Casualty Proceeds. (a) The Borrower will at all times maintain in full force and effect insurance in such amounts, covering such risk and liabilities and with such deductibles or self-insurance retentions as are in accordance with normal industry practice (or as are otherwise required by the Collateral Documents), and in any event in compliance with the requirements of  Schedule 6.06  hereof. Notwithstanding the generality of the foregoing, (i) with respect to any Portfolio Railcar subject to a Lease, the Borrower agrees that it (or the Servicer acting on its behalf) shall enforce the provisions of the Lease against the applicable Lessee as to all required insurance pursuant to the terms thereof, and (ii) with respect to any Portfolio Railcar not subject to a Lease, in addition to its covenants with respect to the Collateral described herein, the Borrower shall comply with the provisions of the Servicing Documents regarding insurance for the Railcar. The Collateral Agent shall be named as loss payee or mortgagee, as its interest may appear, with respect to all such property policies and additional insured with respect to all such other policies (other than workers’ compensation and employee health policies, if any), and each provider of property damage insurance, by
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endorsement upon the policy or policies issued by it or by independent instruments furnished to the Collateral Agent, (i) that the insurance carrier shall pay all proceeds otherwise payable to the Borrower under such policies jointly to the Borrower and the Collateral Agent (which agreement shall be evidenced by a “standard” or “New York” lender’s loss payable endorsement in the name of the Collateral Agent), (ii) to waive all claims for insurance premiums against the Collateral Agent and the Protected Parties, (iii) to provide coverage to the Collateral Agent for the benefit of the Protected Parties regardless of the breach by the Borrower of any warranty or representation made therein, (iv) that no such policy is subject to co-insurance and (v) that it will give the Collateral Agent thirty days’ prior written notice before any such policy or policies shall be materially altered, terminated or canceled, and that no act or default of any Facility Party or any other Person (other than non payment of premiums) shall affect the rights of the Collateral Agent or the Protected Parties under such policy or policies. The Borrower assumes all liability and responsibility in connection with the Portfolio and other property and assets acquired by it and the liability of the Borrower to pay the Obligations shall in no way be affected or diminished by reason of the fact that any such property may be lost, destroyed, stolen, damaged or for any reason whatsoever unavailable to the Borrower.
     (b) Any cash receipts from a Casualty (whether by way of Casualty Proceeds or Lessee indemnity payments or otherwise) received by either the Borrower or the Collateral Agent shall be deposited (in the Borrower’s sole discretion) into either (i) the Modifications and Improvements Account to fund all or a portion of the cost of one or more Required Modifications or Optional Modifications in respect of existing Railcars of the Borrower, (ii) the Substitution Account to fund the acquisition of Qualified Replacement Railcars or (iii) the Collection Account for application as Available Collections and applied pursuant to Section 2.07(c)(i)  or  Section 2.07(c)(ii) , as applicable (except for (x) Excepted Payments, which shall be payable to the Persons for whose benefit any such payment is made and (y) proceeds from the sale of a Railcar subject to a Casualty Event, which shall be applied in the same manner as Net Cash Proceeds). At any time in its discretion within 180 days of deposit into the Modifications and Improvements Account or Substitution Account, as the case may be, the Borrower may also elect to transfer amounts so deposited in the Modifications and Improvements Account (and not otherwise applied) or Substitution Account (and not otherwise applied) into the Collection Account for application as Available Collections for the Measuring Period in which such transfer is made. In any other case, any such amounts in the Modifications and Improvements Account (and not otherwise applied) or Substitution Account (and not otherwise applied) shall be transferred to the Collection Account for application as Available Collections on the next Settlement Date following the 181st day following their deposit. Any insurance proceeds of a Casualty with respect to a Portfolio Railcar or Lessee indemnity payments in connection with a Casualty with respect to a Portfolio Railcar received by TILC or an Affiliate of TILC shall be promptly paid by TILC or such Affiliate of TILC to the Borrower for application in accordance with the foregoing provisions of this  paragraph (b) .
     Upon the request of the Collateral Agent from time to time, the Borrower will promptly and duly execute and deliver any and all such further instruments and documents as may be specified in such request which are reasonably necessary to perfect, preserve or protect the security interests created or intended to be created for the Replacement Railcars referred to herein, or to establish that the Borrower has title to such Railcars.
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     (c) The Borrower shall not operate any Portfolio Railcar and will prohibit each Lessee of any Portfolio Railcar to operate such Portfolio Railcar in violation of any provision of any insurance policy in effect with respect to such Railcar or in any jurisdiction where all of the insurance required hereunder shall not remain in full force and effect or in violation of any law, treaty, statute, rule, directive, regulation or order of any Governmental Authority having jurisdiction over such Portfolio Railcar or in violation of any applicable certificate, license or registration relating to such Portfolio Railcar issued by any such Governmental Authority.
     (d) In connection with the covenants set forth in this Section 6.06, it is understood and agreed that:
     (i) none of the Collateral Agent, the Agent, the Lenders or their respective agents or employees shall be liable for any loss or damage insured by the insurance policies required to be maintained under this  Section 6.06 , it being understood that (A) the Borrower shall look solely to its insurance companies or any other parties other than the aforesaid parties for the recovery of such loss or damage and (B) such insurance companies shall have no rights of subrogation against the Collateral Agent, the Agent, the Lenders or their agents or employees;  provided ,  however , that if the insurance policies do not provide waiver of subrogation rights against such parties, as required above, then the Borrower hereby agrees to waive its right of recovery, if any, against the Collateral Agent, the Agent, the Lenders and their agents and employees, to the extent permitted by law;
     (ii) the Borrower will permit an insurance consultant retained by the Agent, at the expense of the Borrower, to review from time to time the insurance policies maintained by or on behalf of the Borrower annually or upon the occurrence of an Event of Default; and
     (iii) the Agent shall have the right from time to time to require the Borrower to keep other insurance in such form and amount as the Agent may reasonably request;  provided  that such insurance shall be obtainable on commercially reasonable terms; and  provided ,  further , that the designation of any form, type or amount of insurance coverage by the Agent under this Section 6.06  shall in no event be deemed a representation, warranty or advice by the Agent that such insurance is adequate for the purposes of the business of the Borrower or the protection of its properties.
     SECTION 6.07 Operation, Use and Maintenance. (a) Operation and Use. The Borrower will and will require each Lessee to use the Portfolio Railcars only for lawful purposes and shall use and operate and require each Lessee to use and operate the Portfolio Railcars in compliance in all material respects with Applicable Law, except for so long as the Borrower or a Lessee is contesting in good faith by appropriate proceedings diligently conducted the validity or application of such Applicable Law in any reasonable manner. The Portfolio Railcars may not be located or used in any country other than the United States, Canada or Mexico.
     (b) Maintenance. The Borrower will or will require each Lessee to keep, repair and maintain the Portfolio Railcars (i) in good order and operating condition according to industry practice for Railcars of similar age and vintage, ordinary wear and tear excepted, (ii) in
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compliance in all material respects with Applicable Law, except for so long as the Borrower or a Lessee is contesting in good faith by appropriate proceedings diligently conducted the validity or application of such Applicable Law in any reasonable manner, (iii) suitable for use in interchange in accordance with the Interchange Rules and (iv) with respect to Portfolio Railcars not subject to a Lease, at least as well in all material respects as it would for other similar equipment owned, operated or serviced by the Servicer. In addition to (but without limitation of) the foregoing obligation of the Borrower, with respect to any Portfolio Railcar subject to a Lease, the Borrower will use reasonable commercial efforts to cause the Lessee of such Railcar to comply with the maintenance requirements set forth in such Leases.
     (c) Identification Numbers. (i) The Borrower shall cause each Portfolio Railcar to be numbered with its reporting mark as shown on the Bill of Sale under which such Portfolio Railcar was delivered to the Borrower, and from and after such date keep and maintain, plainly, distinctly, permanently and conspicuously marked by a plate or stencil printed in contrasting colors upon each side of each such Portfolio Railcar, in letters not less than one inch in height, a legend substantially as follows:
“OWNERSHIP SUBJECT TO A SECURITY AGREEMENT
 FILED WITH THE SURFACE TRANSPORTATION BOARD”
with appropriate changes thereof and additions thereto as may be required by law in order to protect the Collateral Agent’s right, title and interest in and to such Portfolio Railcars, its rights under the Security Agreement and the rights of the Agent and the other Protected Parties.
     (ii) The Borrower may change or permit to be changed the identifying number of any Portfolio Railcar in accordance with its or the Servicer’s normal business practices at the time applied in a nondiscriminatory manner. Concurrently with the delivery of each Monthly Report or promptly upon request of the Collateral Agent if there exists an Event of Default, the Borrower shall deliver to the Collateral Agent a list of the identifying numbers of all Portfolio Railcars that have been changed within the period covered by such Monthly Report and prior thereto to the extent not previously disclosed by the Borrower and evidence of the filing, recording or depositing in such public offices where the Security Agreement (or memoranda or notices thereof) have been filed, recorded or deposited reflecting any changes in identifying numbers which have occurred within such period and prior thereto to the extent not previously disclosed by the Borrower as may be necessary to preserve and perfect the interest of the Collateral Agent and the Lenders in the Portfolio Railcars whose identifying numbers have changed.
     (d) Insignia. Except as provided in Section 6.07(c), the Borrower will not allow the name of any Person to be placed on any Railcar as a designation that might be interpreted as a claim of ownership;  provided ,  however , that the Borrower may permit any of the Portfolio Railcars to be lettered with the names, trademarks, initials or other insignia customarily used by the Borrower or its Affiliates (including the Marks Company), or any Lessee or its Affiliates, on railroad equipment used or leased by such Person of the same or a similar type for convenience of identification of its right to use such Portfolio Railcar under any applicable Lease, and any of the Portfolio Railcars may be lettered in an appropriate manner for convenience of identification of the interest of the Borrower or any Lessee therein.
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     SECTION 6.08 Replacement of Parts; Modifications and Improvements. (a) Replacement of Parts. The Borrower, at its sole cost and expense (whether from the Maintenance Reserve Account, the Operating Expense Account or otherwise), will as promptly as practicable replace all Parts with respect to Portfolio Railcars that are not then subject to a Lease or are required to be maintained by the Borrower pursuant to a Lease that may from time to time become worn out, obsolete, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or permanently rendered unfit for use for any reason whatsoever. In addition, in the course of maintenance, service, repair, overhaul or testing, the Borrower, at its sole cost and expense, may remove any Part, whether or not worn out, obsolete, lost, stolen, destroyed, seized, confiscated, damaged beyond repair or permanently rendered unfit for use. All replacement Parts shall be selected and installed in accordance with the Borrower’s or the Servicer’s normal business practices at that time applied in a nondiscriminatory manner, and shall be free and clear of all Liens except Permitted Liens and shall be in good operating condition.
     (b) Lease Required Modifications and Improvements. Subject to clause (e) of this Section 6.08, the Borrower shall make or cause to be made such material modifications and improvements to each Portfolio Railcar to the extent required of the Borrower by the terms of the applicable Lease (each occurrence, a “ Lease Required Modification ).
     (c) Required Modifications and Improvements. Subject to clause (e) of this Section 6.08, the Borrower shall in the event (i) any Governmental Authority or any Applicable Law requires as a condition of continued use or operation of any Portfolio Railcar that such Portfolio Railcar be altered or modified or (ii) any Administrative Agency determines that any Portfolio Railcar may be in an unsafe operating condition and as a result the Borrower determines that such Portfolio Railcar must be altered or modified (each occurrence under (i) and (ii), a “ Required Modification ”), the Borrower agrees to make or have made such Required Modification in a timely manner;  provided  that, the Borrower may, in good faith and by appropriate proceedings diligently conducted, contest the validity or application of any such law, regulation, requirement or rule in any reasonable manner which does not materially interfere with the use, possession, operation or return of any Portfolio Railcar or materially adversely affect the rights or interests of the Agent, Collateral Agent or the other Protected Parties in the Portfolio Railcars or under any Loan Document or otherwise expose the Borrower to criminal or material financial sanctions. Promptly after the Borrower becomes aware of the requirement to make a Required Modification, the Borrower shall notify the Agent thereof, which notice shall also set forth the time period for the making of such Required Modification and the Borrower’s reasonable estimate of the cost thereof. If the Borrower (after consultation with the Servicer) believes that any Required Modification to either an individual Portfolio Railcar or an aggregate of Portfolio Railcars would be economically impractical, the Borrower shall provide written notice to the Agent that such Required Modification is economically impractical, and shall treat such Portfolio Railcar as if an Event of Loss had occurred as of the date of such written notice with respect to such Portfolio Railcar. In such event the provisions of the Loan Agreement and the Servicing Agreement with respect to Events of Loss shall apply with respect to such Portfolio Railcar. In reaching any decision as to whether a Required Modification is economically impractical, the Borrower shall assess the cost and timing of the Required Modification, the anticipated revenues and other sources of funds which would be available to the Company to fund such costs, the requirements of the Loan Agreement and such other factors as the Borrower
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considers necessary or appropriate and shall provide a report to the Agent, regarding such assessment.
     (d) Optional Modifications and Improvements. The Borrower may, upon consent of the Agent, modify, alter or improve any Portfolio Railcar in a manner which is not a Required Modification, including any Portfolio Railcar not then under a Lease (“ Optional Modification ”), if the Borrower concludes in good faith that the proposed Optional Modification is likely to enhance the marketability of the Portfolio Railcar (or such Optional Modification is requested by a Lessee);  provided  that Optional Modifications may be funded only from (i) capital contributions made by TILC to the Borrower (for the avoidance of doubt, such capital contributions are permitted but not required under this Agreement), (ii) distributions which would otherwise be made to or at the direction of the Borrower pursuant to  Section 2.07(c)(i)  or  Section 2.07(c)(ii)  or (iii) proceeds of a Permitted Discretionary Sale, Event of Loss or Casualty but only to the extent for purposes of this  clause (iii)  that such modifications increase the fair market value (determined without regard to any previously existing Railcar defects) of such Railcar as certified by the Borrower, and no Optional Modification shall diminish the fair market value, utility, residual value or remaining economic useful life of such Portfolio Railcar below the fair market value, utility, residual value or remaining economic useful life thereof immediately prior to such Optional Modification, in more than a de minimis respect.
     (e) Modification Costs. Any Lease Required Modification or Required Modification to a Railcar in excess of 5% of such Railcar’s then Original Value shall  not  be funded from any Account without the prior written consent of the Agent.
     SECTION 6.09 Replacement of Railcars; Substitution Account. (a) Disposition Proceeds. The Borrower, as soon as practicable and in any event within 180 days of the date in which the Net Cash Proceeds of an Asset Disposition are received by the Borrower, will deposit all such Net Cash Proceeds into the Net Cash Proceeds Account to be applied in the manner and order of priority set forth in  Section 2.07(c)(iii) , or alternatively, (i) in the case of an Asset Disposition constituting an Event of Loss or Condemnation, unless the Borrower intends to use the proceeds of such Asset Dispostion to acquire Qualifying Replacement Railcars or to prepay the Loans, deposit such Net Cash Proceeds into the Modifications and Improvements Account to fund Optional Modifications in accordance with  Section 6.09(b)  below or (ii) in the case of an Asset Disposition constituting a Permitted Discretionary Sale, deposit such Net Cash Proceeds into the Substitution Account to fund the acquisition cost of the Qualifying Replacement Railcars previously identified by the Borrower or the Servicer on the applicable Qualifying Replacement Railcar Certificate (provided such Railcars remain commercially available for acquisition) in accordance with  Section 6.09(c) below.
     (b) Revinvestment of Proceeds from an Event of Loss or Condemnation. The Borrower may reinvest proceeds from an Event of Loss or Condemnation that have been deposited into the Modifications and Improvements Account as described above to fund all or a portion of the cost of one or more Required Modifications or Optional Modifications in respect of existing Railcars of the Borrower. At any time in its discretion within 180 days of deposit into the Modifications and Improvements Account, the Borrower may also elect to transfer amounts so deposited in the Modifications and Improvements Account (and not otherwise applied) into the Net Cash Proceeds Account for application as Net Cash Proceeds for the Measuring Period in
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which such transfer is made. In any other case, any such amounts in the Modifications and Improvements Account (and not otherwise applied) shall be transferred to the Net Cash Proceeds Account for application as Net Cash Proceeds on the next Settlement Date following the 181st day following their deposit.
     (c) Revinvestment of Sale/Disposition Proceeds in Replacement Railcars. In the event the Borrower intends to use the proceeds of a Permitted Discretionary Sale to acquire Qualifying Replacement Railcars, the Borrower prior to such contemplated Permitted Discretionary Sale shall identify Qualifying Replacement Railcars to replace the Portfolio Railcars subject to the contemplated Permitted Discretionary Sale, such replacement expected to occur within 30 days of such Permitted Discretionary Sale and shall deliver to the Agent a Qualifying Replacement Railcar Certificate prior to such Permitted Discretionary Sale. All Railcars that replace Portfolio Railcars subject to a Permitted Discretionary Sale shall be Qualifying Replacement Railcars in order to be Portfolio Railcars. Upon acquisition, such Replacement Railcars (and any related Leases) will become subject to the lien of the Security Agreement (and related Transaction Documents). To the extent such proceeds are not so used to acquire Qualifying Replacement Railcars within 180 days of the date of deposit into the Substitution Account, such amounts shall be transferred to the Net Cash Proceeds Account on the next Settlement Date following the 181st day following their deposit for application as Net Cash Proceeds for the Measuring Period in which such transfer is made.
     SECTION 6.10 Use of Proceeds. The Borrower will use the proceeds of the Loans solely for the purposes set forth in Section 5.13 .
     SECTION 6.11 Audits/Inspections/Appraisals. (a) Audits and Inspections. The Collateral Agent and the Agent, together with their respective designated representatives, including independent accountants, agents, employees, attorneys and appraisers, shall have the right to (i) inspect all documents of the Borrower and the Servicer (the “ Related Documents ”), including without limitation all leases, insurance policies, warranties or other agreements relating to the Portfolio Railcars and the other Collateral (during such period of time when such Portfolio Railcar or other Collateral, as the case may be, was part of the Portfolio) (each such inspection, a “ Related Document Inspection ”); (ii) inspect and audit each of the Company’s and the Servicer’s books, records and databases (which shall include reasonable access electronic copies of the Borrower’s and the Servicer’s records to the extent necessary to determine compliance with the Transaction Documents) (collectively, the “ Books and Records ”) with respect to the Portfolio Railcars and the other Collateral and Related Documents (including without limitation data supporting all reporting requirements under the Transaction Documents) (each such inspection, a “ Books and Records Inspection ”); (iii) discuss (A) the affairs, finances and accounts of the Company and the Servicer and (B) the Portfolio Railcars and the other Collateral, the Related Documents and the Books and Records, in each case with the principal executive officer and the principal financial officer of each of the Company and the Servicer, as applicable (the foregoing clauses (A) and (B), a “ Company Inspection ”); (iv) conduct evaluations and appraisals of, subject to the provisions of  Section 6.11(b)  below in the case of the Portfolio Railcars, the assets included in the Collateral; and (v) subject to restrictions and procedures on inspection of the Portfolio Railcars in any applicable Lease, conduct a physical inspection of any Portfolio Railcar or otherwise obtain a Physical Inspection Report with respect thereto at any time after the occurrence and during the continuance of an Event of Default (each such inspection, a “Physical
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Inspection”, and together with each other inspection described in (i), (ii), (iii) and (iv) above, collectively, the “ Inspections ”);  provided ,  however , Related Documents and Books and Records shall not include the Servicer’s customer list or any other information that the Servicer reasonably determines is of a proprietary nature, unless failure to provide such information would cause either the Servicer or the Borrower to breach its respective obligations under any of the Transaction Documents. All Inspections shall be conducted upon reasonable request and with at least five (5) Business Days’ notice from the Agent to the Company (with respect to Inspections of the Company) and the Servicer (with respect to inspections of the Company or the Servicer) and shall be conducted during normal business hours, be subject to the Company’s and the Servicer’s customary security procedures, if any, and not unreasonably disrupt the Company’s or the Servicer’s business. Without prejudice to the right to conduct Inspections, all parties granted inspection rights hereunder shall confer with a view toward coordinating their conduct with respect to Inspections in order to minimize the costs thereof and business disruption attendant thereto.
     (b) Appraisals. The Borrower (at its sole cost and expense) at the request of the Agent shall provide an Independent Appraisal (based upon a “desktop appraisal”) with respect to all Portfolio Railcars (i) if a Monthly Utilization Event has occurred and is continuing (but not more frequently than once during any six consecutive months), (ii) upon the fifth (5 th ) anniversary of the Closing Date and (iii) upon the Term Maturity Date and at any time thereafter (but in the case of this  clause (iii) , not more frequently than once every two years). The Borrower or the Servicer also may at any time and from time to time obtain an appraisal of any Railcar (in addition to the Independent Appraisal required pursuant to this  Section 6.11(b) ) at its own expense. Each Independent Appraisal delivered pursuant to this  Section 6.11(b)  shall be in form and substance reasonably satisfactory to the Agent;  provided  that with respect to any Railcar, when appropriate and acceptable to the Agent, any such Independent Appraisal may be in the form of a letter from an Independent Appraiser confirming the Independent Appraisal previously delivered by such Independent Appraiser with respect to such Railcar.
     SECTION 6.12 Stamp Tax. If any jurisdiction in which any Portfolio Railcar is registered, operated or located, from time to time, requires the payment of a stamp tax, fee or its equivalent in order to perfect the Collateral Agent’s security interest in such Railcar or otherwise to allow the Agent to realize upon the Collateral, the Borrower shall pay the amount of such stamp tax, fee or its equivalent in accordance with  Section 2.07(c) .
     SECTION 6.13 Follow-On Leases. The Borrower will not enter into any Portfolio Lease which was not in place as of the Closing Date (and described in the applicable Notice of Borrowing) (a “ Follow-On Lease ”) unless the conditions precedent described in paragraphs  (b) ,  (c) ,  (d) ,  (f) ,  (h) ,  (i) ,  (m)(ii) ,  (o)  and  (q)  of  Section 4.02  hereof have been satisfied with respect to such Follow-On Lease.
     SECTION 6.14 Accounts. (a) On or prior to the date hereof, the Borrower shall cause to be established one or more accounts with the Depositary pursuant to the Depository Agreement in the name of the Borrower. The Borrower shall cause the Depositary to create a Collection Account, a Liquidity Reserve Account, a Maintenance Reserve Account, a Security Deposits Account, an Operating Expenses Account, a Modifications and Improvements Account, a Net Cash Proceeds Account and a Substitution Account, in each case in accordance with the
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terms of the Depository Agreement. The Agent shall cause the Depositary to create a Prefunding Account in accordance with the terms of the Depository Agreement. The Borrower shall notify (and the Borrower hereby authorizes the Collateral Agent so to notify), in each case following the occurrence and during the continuation of an Event of Default, each Lessee and other account debtors of the Borrower in writing that each Lease and other accounts receivable of the Borrowers has been assigned to the Collateral Agent under the Loan Documents for the benefit of the Protected Parties. The Borrower also shall notify and instruct each Lessee that all payments due or to become due under each Portfolio Lease (except for Excepted Payments (which shall be payable to the Persons for whose benefit any such payment is made)) or otherwise in respect of amounts and other receivables of the Borrower are to be made directly to the Customer Payments Account.
     (b) Any amounts from time to time held in the Collection Account, the Maintenance Reserve Account, the Modifications and Improvements Account, Security Deposits Account, Operating Expenses Account, the Liquidity Reserve Account and the Substitution Account may be invested in Cash Equivalents (subject to the provisions of the Depository Agreement), at the Borrower’s risk as directed in writing by the Borrower, until the application thereof in accordance with this Agreement. Upon the occurrence and during the continuance of an Event of Default, the Agent may direct by notice the Depositary to pay to the Agent the amount specified in such notice from the Account(s) specified in such notice, and the Agent shall apply such amounts received from the Depositary to the repayment of the Obligations in accordance with the applicable provisions of Section 2.07(c) .
     (c) Subject to the provisions of the Depository Agreement, the Agent may at any time and from time to time in its sole discretion (and, to the extent such application would have the effect of curing a Default under  Section 9.01(a)  hereof or if the Loans have become or been declared immediately due and payable pursuant to  Section 9.02 , shall) instruct the Depositary to pay into the Collection Account the amounts on deposit in the Liquidity Reserve Account if and to the extent the amounts in the Collection Account on any Settlement Date would be insufficient to pay in full the items described in  clauses first ,  second , third ,  fourth  and  fifth  of  Section 2.07(c)(i)  or  clauses first ,  second ,  third ,  fourth  and  fifth  of  Section 2.07(c)(ii) , as the case may be;  provided  that, so long as no Event of Default shall have occurred and then be continuing, (i) the Agent shall have consulted with the Borrower prior to giving such instruction and (ii) if and to the extent determined by the Agent and the Borrower that a reserve is required to be held in the Accounts in respect of anticipated claims by a Lessee for payment of deposit, maintenance reserves or insurance or indemnity payments, such reserve shall be retained in the Accounts.
     (d) The Borrower hereby agrees to endeavor to transfer all Available Collections from the Customer Payments Account to the Collections Account within three (3) Business Days of deposit in the Customer Payments Account but in no event later than six (6) Business Days of deposit of any Available Collections in the Customer Payments Account, and shall provide timely written notice thereof (which notice may be made by facsimile or electronic mail) to the Agent, in each case in accordance with the Customer Collections Account Administration Agreement.
     SECTION 6.15 Servicer. The Borrower and the Agent further agree that, upon the occurrence and continuance of an Event of Default, any event set forth in clauses (a) through (k)
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of Section 7.02 of the Servicing Agreement, a Servicer Replacement Event or as otherwise provided in the Servicing Documents, the Agent (acting at the direction of the Supermajority Lenders), without the consent or action of or by any Facility Party, shall automatically succeed to all of the Borrower’s rights and powers under the Servicing Documents, and shall succeed to any of the Borrower’s rights and powers to remove the Servicer, terminate any Servicing Document(s), appoint a new Servicer that is reasonably satisfactory to both the Agent and the Supermajority Lenders, in accordance with Section 7.04 of the Servicing Agreement, and enter into new Servicing Document(s) with such new Servicer; provided that, as a condition precedent to the Agent removing and replacing the Servicer, the Agent shall request from each Rating Agency, a determination whether, as a result of such removal or replacement, it would cause the rating of the Loans to be reduced or withdrawn.
     SECTION 6.16 Action after an Event of Default. Following the occurrence and during the continuance of an Event of Default, the Borrower shall, in connection with taking any action or exercising any rights or remedies under any Lease Document or Servicing Document, comply in good faith with all requests from the Agent and Collateral Agent (it being understood that the Borrower will not be considered in breach of this  Section 6.16  or any other provision of any Transaction Document by virtue of complying or failing to comply with such requests).
     SECTION 6.17 Required Asset Dispositions. At any time and from time to time following the occurrence of the Term Maturity Date, the Borrower shall comply in good faith with all requests from the Collateral Agent to consummate Railcar sales.
ARTICLE VII
NEGATIVE COVENANTS
     The Borrower agrees that so long as any Lender has any Commitment hereunder or any Obligations or other amount payable hereunder or under any Note or other Loan Document remains unpaid:
     SECTION 7.01 Limitation on Debt. The Borrower will not incur, create, assume or permit to exist any Debt, including, without limitation, Derivatives Obligations except:
     (i) Debt of the Borrower under or permitted by this Agreement and the other Loan Documents; and
     (ii) Derivatives Obligations of the Borrower under Derivatives Agreements to the extent entered into after the Closing Date with the express written consent of the Agent to manage interest rate risks and not for speculative purposes.
     SECTION 7.02 Restriction on Liens. The Borrower will not create, incur, assume or permit to exist any Lien on any property or assets now owned or hereafter acquired by it or on any income or rights in respect of any thereof, except Permitted Liens.
     SECTION 7.03 Nature of Business. The Borrower will not alter the character or conduct of the business conducted by it as of the Closing Date and activities directly related thereto.
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     SECTION 7.04 Consolidation, Merger and Dissolution. The Borrower will not enter into any transaction of merger or consolidation or liquidate, wind up or dissolve itself or its affairs (or suffer any liquidations or dissolutions), or convert into any other Person.
     SECTION 7.05 Asset Dispositions. The Borrower will not make or permit or consent to any Asset Disposition; provided that (i) the Borrower may make or permit or consent to any Asset Disposition by way of Event of Loss or Condemnation, so long as the Net Cash Proceeds of such Asset Disposition shall have or upon receipt shall be delivered to the Depositary to be deposited into the Net Cash Proceeds Account, Modifications and Improvements Account or Substitution Account in accordance with Section 6.09 , (ii) the Borrower may make or permit or consent to any Permitted Discretionary Sale (including in connection with a Securitization) if the Net Cash Proceeds of such Asset Disposition have or simultaneously therewith be delivered to the Depositary to be deposited into the Net Cash Proceeds Account or Substitution Account in accordance with  Section 6.09 , (iii) the Borrower shall make or permit or consent to any Asset Disposition required by the Collateral Agent in accordance with Section 6.17  and (iv) the Borrower may make or permit or consent to any Asset Disposition not otherwise described in  clauses (i) ,  (ii)  or  (iii)  of this paragraph at the direction of the Required Lenders (provided that the aggregate sum of the Original Values of all Railcars that the Borrower sells or exchanges in all sales or exchanges of Railcars (including sales pursuant to a Lessee purchase option and including Asset Dispositions described in this  clause (iv) ) from the Closing Date until (and including) the Expected Maturity Date in order to purchase Replacement Railcars, does not exceed 20% of the Aggregate Original Value of all the Railcars in the Portfolio as of the Closing Date). Upon consummation of an Asset Disposition permitted under this Section 7.05 , the Collateral Agent shall (to the extent applicable) deliver to the Borrower, upon the Borrower’s request and at the Borrower’s expense, such documentation as is reasonably necessary to evidence the release of the Collateral Agent’s security interests, if any, in the assets being disposed of, including amendments or terminations of Uniform Commercial Code Financing Statements, if any.
     SECTION 7.06 Investments. The Borrower will not hold, make or acquire, any Investment in any Person, except that:
     (i) the Borrower may invest in cash and Cash Equivalents pursuant to this Agreement and the Depository Agreement;
     (ii) the Borrower may acquire and hold receivables owing to it, if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms;
     (iii) the Borrower may acquire and own Investments (including Debt obligations) received in connection with the bankruptcy or reorganization of suppliers and customers and in settlement of delinquent obligations of, and other disputes with, customers and suppliers arising in the ordinary course of business; and
     (iv) the Borrower may purchase Eligible Railcars, Eligible Leases and other related inventory, machinery and equipment in the ordinary course of business.
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     SECTION 7.07 Restricted Payments, etc. The Borrower will not declare or pay any Restricted Payments (other than Restricted Payments payable solely in Equity Interests (exclusive of Disqualified Stock), of the Borrower, except that, so long as no Insolvency Event, Default or Event of Default has occurred and is continuing, the Borrower may make Restricted Payments from time to time to the extent cash is made available to the Borrower pursuant to  Section 2.07(c) .
     SECTION 7.08 Transactions with Affiliates. The Borrower will not engage in any transaction or series of transactions with (i) any officer, director, holder of any Equity Interest in or other Affiliate of the Borrower or (ii) any Affiliate of any such officer, director, holder or Affiliate, other than (A) the payment of the Servicer’s Fees as provided in  Section 2.07(c) , (B) reimbursement of Servicer Advances pursuant to the Servicing Agreement and  Section 2.07(c) , (C) transfers of assets permitted by  Section 7.05 , (D) as otherwise expressly provided for or contemplated in any Loan Document and (E) so long as no Default or Event of Default has occurred and is continuing, other transactions (including the purchase of Railcars) which are engaged in by the Borrower in the ordinary course of its business on terms and conditions as favorable to it as would be obtainable by it in a comparable arm’s-length transaction with an independent, unrelated third party.
     SECTION 7.09 Fiscal Year; Organization and Other Documents. The Borrower will not (i) change its fiscal year, (ii) enter into any amendment, modification or waiver to its Organization Documents, (iii) except with the consent of the Agent and subject to  Section 7.13 , amend, modify, extend, renew, cancel or terminate the Purchase and Sale Agreement, any Bill of Sale, any other Sale Agreement, any Servicing Document, any Lease Document or any other Assigned Agreement (as defined in the Security Agreement), waive any material default under or breach of any such agreement, compromise or settle any material dispute, claim, suit or legal proceeding relating to any such agreement, sell or assign any such agreement or interest therein, consent to or permit or accept any prepayment of amounts to become due under or in connection with any such agreement, except as expressly provided therein, or take any other action in connection with any such agreement which would materially impair the value of the interests or rights of the Borrower thereunder or which would impair the interests or rights of the Agent under this Agreement, except that, unless the Agent shall have notified the Borrower upon the occurrence of an Event of Default that this exception is no longer available or if the same would otherwise be adverse in any material respect to the interests of the Agent and the Lenders, the Borrower may (or may permit the Servicer to) modify, make adjustments with respect to, extend or renew any Assigned Agreements in the ordinary course of business, and except that  Sections 7.13  and  7.14  shall govern the right of the Borrower to waive or permit the waiver of a Lease Default or Lease Event of Default or (iv) enter into any amendment, modification or waiver which is in any manner adverse to the interests of the Collateral Agent, the Agent and the Lenders to any Servicing Document or the Purchase and Sale Agreement, in each case as in effect on the Closing Date. The Borrower will promptly provide the Lenders with copies of all amendments to the foregoing documents and instruments as in effect as of the Closing Date.
     SECTION 7.10 Additional Negative Pledges. The Borrower will not enter into, assume or become subject to any agreement prohibiting or otherwise restricting the creation or assumption of any Lien upon its properties or assets, whether now owned or hereafter acquired,
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or requiring the grant of any security for an obligation if security is given for some other obligation, except pursuant to this Agreement and the other Loan Documents.
     SECTION 7.11 Impairment of Security Interests. The Borrower will not take or omit to take any action which action or omission might or would materially impair the security interests in favor of the Collateral Agent with respect to the Collateral.
     SECTION 7.12 Interest Coverage Tests. As of any Settlement Date, (i) the One Month Interest Coverage Ratio will not be less than 1.20 to 1.00 and (ii) the Average Six Month Interest Coverage Ratio will not be less than 1.25 to 1.00.
     SECTION 7.13 No Amendments to the Lease Documents. Without prior written consent of the Agent or as expressly provided by the terms of this Agreement, the Borrower will not amend, modify, consent to or permit any change in the terms or otherwise alter or grant any consent or approval under any Lease Document in a manner which would materially and adversely affect the Collateral Agent, the Agent or Lenders.
     SECTION 7.14 Lease Default. Without the prior written consent of the Agent, which consent may be granted or withheld at the Agent’s sole discretion, the Borrower will not waive (or permit the waiver of) a Lease Default or Lease Event of Default under a Lease;  provided ,  however , that unless a Default arising from the failure to make a payment when due hereunder or an Event of Default has occurred and is continuing, the Borrower may elect, in its reasonable discretion and upon written notice to the Agent, to give such waiver (or permit such waiver), so long as such waiver is limited to the particular facts giving rise to such Lease Default or Lease Event of Default and does not prejudice the Borrower’s (or Collateral Agent’s, by assignment) rights under the relevant Lease to exercise remedies with respect to any other or future Lease Defaults or Lease Events of Default;  provided ,  further , that any such waiver without the prior written consent of the Agent shall not cause a Lease which otherwise would fail to be an Eligible Lease to be an Eligible Lease.
     SECTION 7.15 Consolidation with Any Other Person. The Borrower will not operate in a manner that would result in substantive consolidation of the “estate” (as defined in Section 541(c) of the Bankruptcy Code) of the Borrower with the “estate” of any other Person, and in such connection the Borrower shall observe all corporate formalities, and maintain records separately and independently from those of any other Person.
     SECTION 7.16 Limitations on Employees, Subsidiaries. The Borrower will not employ or maintain any employees other than as required by Applicable Law;  provided  that officers and directors shall not be deemed to be employees for purposes of this Section 7.16 . The Borrower will not hold or own any Subsidiaries other than Railcar Subsidaries.
     SECTION 7.17 Independence of Covenants. All covenants contained herein shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that such action or condition would be permitted by an exception to, or otherwise be within the limitations of, another covenant shall not avoid the occurrence of a Default if such action is taken or condition exists.
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ARTICLE VIII
OTHER REPRESENTATIONS, WARRANTIES AND COVENANTS
     SECTION 8.01 Lender’s Representation and Warranty. Each Lender represents and warrants as to itself on the Closing Date, and as to itself at all times until the Termination Date that no part of the assets to be used by such Lender to purchase the Loans or Notes constitutes assets of an “employee benefit plan” as defined in Section 3(3) of ERISA, which is subject to Title I of ERISA, a “plan” as defined in Section 4975 of the Code which is subject to Section 4975 of the Code, an entity whose underlying assets include “plan assets” by reason of any such employee benefit plan’s or plan’s investment in such entity, or a governmental, church or non-U.S. plan which is subject to any federal, state, local or non-U.S. law that is similar to the prohibited transaction provisions of Section 406 of ERISA or Section 4975 of the Code.
     SECTION 8.02 Quiet Enjoyment. The Agent, the Collateral Agent and each Lender hereby covenant and agree that so long as no Lease Event of Default has occurred and is continuing, neither it nor any Person claiming by, through or under it shall take or cause to be taken any action contrary to any Lessee’s or any permitted sublessee’s right to quiet enjoyment of, and the continuing possession, use and operation of, the relevant Portfolio Railcar during the term of such Lease and in accordance with the terms of such Lease. To the extent reasonably requested by a Lessee in connection with the Closing Date, the Agent, the Collateral Agent and each Lender shall confirm this  Section 8.02 .
     SECTION 8.03 Lender’s Covenant. Each Lender, and each subsequent holder of any Note, agrees with the Borrower and each other Protected Party (excluding the Servicer) that, until the Termination Date shall have occurred, it will not dispose of the Loans or Notes to be purchased by it or any interest therein (including, without limitation, any transfer by a change in the capacity in which such Lender holds its investment in such Loans or Notes) to any Person unless such Person shall (A) make all warranties and representations of such Lender contained in  Section 8.01  and (B) assume all covenants of such Lender contained in  Section 8.02  and this  Section 8.03 .
ARTICLE IX
DEFAULTS
     SECTION 9.01 Events of Default. An Event of Default shall exist upon the occurrence of any of the following specified events or conditions (each an “ Event of Default ”):
     (a) Payment. Any default shall occur in the payment when due (whether by scheduled maturity, acceleration or otherwise) of any principal of or any interest on the Loans (other than to the extent there are insufficient Available Collections to pay principal pursuant to  Section 2.07(c)(i)  or  Section 2.07(c)(ii)  or to the extent there are insufficient Net Cash Proceeds attributable to an Event of Loss or attributable to a sale of a Railcar subject to a Casualty (in the event the Borrower or Servicer determines that repairs to such Railcar subject to a Casualty are economically impractical) to pay principal pursuant to Section 2.07(c)(iii)  or with respect to interest calculated by
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reference to the Default Margin or Step-Up Yield), and such payment is not received within one Business Day of the due date therefor, or any default shall occur in the payment when due of any fees or other amounts owing to the Lenders under any Loan Document or in connection herewith or therewith (in any case, other than with respect to interest calculated by reference to the Default Margin), which default shall continue for 15 days after notice thereof has been given to the Borrower and the Servicer by the Agent;  provided ,  however , in the case of any payment required to be made pursuant to  Section 2.06(a) , a default in respect of such payment shall occur on such date as provided for in  Section 9.01(i) .
     (b) Principal Payment Deficiency. There shall occur a Principal Payment Deficiency Event.
     (c) Representations. Any representation, warranty or statement made or deemed to be made by the Borrower or the Servicer in any Transaction Document, or in any statement or certificate delivered or required to be delivered pursuant hereto or thereto shall prove untrue or incorrect in any material respect on the date as of which it was made or deemed to have been made and if capable of being cured shall not have been cured within fifteen days after the earlier of an executive officer of the Borrower and/or Servicer, as the case may be, becoming aware of such untruth or notice thereof given by the Agent to the Borrower and/or Servicer, as the case may be; provided, that with respect to any of the foregoing as to which rescission of transfer is a remedy available under Section 4.9 of any Purchase and Sale Agreement, no Event of Default shall exist as a result of such event unless and until there has been a failure by the Seller under any such Purchase and Sale Agreement to make the rescission payment described in said Section 4.9.
     (d) Covenants. The Borrower shall:
     (i) default in the due performance or observance by it of any term, covenant or agreement contained in Sections6.06, 6.14 ,  7.01 ,  7.02 ,  7.03 ,  7.04 ,  7.05 ,  7.06 ,  7.09 ,  7.10 ,  7.11 ,  7.12 ,  7.13  and  7.16  of this Agreement;
     (ii) default in the due performance or observance by it of any term, covenant or agreement contained in Section6.10 or 6.01(f)  and such default shall continue unremedied for a period of two Business Days;
     (iii) default in the due performance or observance by it of any term, covenant or agreement contained in Section 6.17 and such default shall continue unremedied on the six (6) month anniversary date of the date in which the Agent first gave notice to the Borrower to consummate Railcar sales;
     (iv) default in the due performance or observance by it of any term, covenant or agreement contained in Article VI (other than those referred to in  subsections (a) ,  (b) ,  (c) ,  (d)(i)  ,  (d)(ii)  or  (d)(iii)  of this  Section 9.01 ) and such default shall continue unremedied for a period of 15 days after the earlier of an executive officer of the Borrower or the Servicer becoming aware of such default
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or notice thereof given by the Agent to the Borrower and/or the Servicer, as the case may be; or
     (v) default in the due performance or observance by it of any term, covenant or agreement (other than those referred to in  subsections (a) ,  (b) ,  (c)  or  (d)(i) ,  (d)(ii)  ,  (d)(iii)  or (d)(iv) of this  Section 9.01 ) contained in this Agreement and such default shall continue unremedied for a period of 30 days after the earlier of an executive officer of the Borrower or Servicer becoming aware of such default or notice thereof given by the Agent to the Borrower and/or the Servicer, as the case may be.
     (e) Loan Documents. Except pursuant to the terms thereof, any Loan Document shall (i) fail to be in full force and effect or any Facility Party shall so assert or (ii) fail to give the Collateral Agent and/or the Lenders the security interests, liens, rights, powers and privileges purported to be created thereby.
     (f) Cross-Default. There occurs under any Derivatives Agreement an Early Termination Date (as defined in such Derivatives Agreement) resulting from (A) any event of default under such Derivatives Agreement as to which the Borrower is the Defaulting Party (as defined in such Derivatives Agreement) or (B) any Termination Event (as so defined) as to which the Borrower is an Affected Party (as so defined), and, in either event, the Derivatives Termination Value owed by the Borrower as a result thereof is greater than $1,000,000.
     (g) Insolvency Events. (i) The Borrower shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it, or shall make a general assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due, or shall take any corporate action to authorize any of the foregoing or (ii) an involuntary case or other proceeding shall be commenced against the Borrower seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed and unstayed for a period of 60 days, or any order for relief shall be entered against the Borrower under the federal bankruptcy laws as now or hereafter in effect.
     (h) Judgments. One or more judgments, orders, decrees or arbitration awards is entered against the Borrower involving in the aggregate a liability (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage), as to any single or related series of transactions, incidents or conditions, of $10,000,000 or more, and the same shall remain undischarged, unvacated and unstayed pending appeal for a period of 30 days during which execution shall not be effectively
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stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Borrower to enforce any such judgment or the Borrower shall enter into any agreement to settle or compromise any pending or threatened litigation, as to any single or related series of claims, involving payment of $10,000,000 or more by the Borrower, or any non-monetary judgment, order or decree is entered against the Borrower which has or would reasonably be expected to have a Material Adverse Effect, and there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect.
     (i) Required Asset Disposition. At any time and from time to time following the occurrence of the Term Maturity Date, the Borrower’s failure to consummate Railcar sales and to repay the outstanding principal amount of the Loans in an amount equal to the aggregate of the Allocable Debt for each Railcar so requested to be sold (plus interest thereon) within six (6) months of the first notice from the Collateral Agent to consummate such sales.
     (j) Ownership. There shall occur a Change of Control.
     SECTION 9.02 Acceleration; Remedies. Upon the occurrence of an Event of Default, and at any time thereafter unless and until such Event of Default has been waived in writing by the Supermajority Lenders (or all of the Lenders as may be required pursuant to  Section 11.03 ), the Collateral Agent, or the Agent upon the request and written direction of the Required Lenders, shall by written notice to the Borrower, take any of the following actions without prejudice to the rights of the Collateral Agent, the Agent or any Lender to enforce its claims against the Borrower except as otherwise specifically provided for herein:
     (a) Acceleration of Loans. Declare the unpaid principal of and any accrued interest in respect of all Loans and any and all other indebtedness or obligations of any and every kind owing by the Borrower to any of the Lenders hereunder to be due whereupon the same shall be immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.
     (b) Enforcement of Rights. Enforce any and all rights and interests created and existing under the Loan Documents, including, without limitation, directing the Collateral Agent to enforce any and all rights and remedies existing under the Collateral Documents and all rights of set-off.
     (c) Payment Notice/Lessor Rights Notice. Deliver the Payment Notice/Lessor Rights Notice to the applicable Lessees with respect to any or all of the Portfolio Leases.
     (d) Six Month Anniversary of Term Maturity Date. At any time and from time to time following the occurrence of the six (6) month anniversary of the date in which the Collateral Agent first gave notice to the Borrower to consummate Railcar sales pursuant to  Section 2.06(a) , if the outstanding principal balance of the Loans is  greater  than zero then the Collateral Agent (at the written direction of the Agent and the Required Lenders, which direction shall specify the manner in which such Collateral shall be sold as well as the amount), in addition to and without
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limiting any other remedies that may be available to the Collateral Agent under the Loan Documents, and without any action or consent of the Borrower, may sell or cause to be sold all or any part of the Collateral in the amount and in the manner determined by the Agent and the Required Lenders, and the Net Cash Proceeds of such sale or sales shall be applied in accordance with  Section 2.07(c)(iii) .
     Notwithstanding the foregoing, if an Event of Default specified in Section 9.01(g) shall occur, then all Loans, all accrued interest in respect thereof and all accrued and unpaid fees and other indebtedness or obligations owing to the Lenders hereunder and under the other Loan Documents shall immediately become due and payable without the giving of any notice or other action by the Collateral Agent, the Agent or the Lenders, which notice or other action is expressly waived by the Borrower.
     Notwithstanding the fact that enforcement powers reside primarily with the Collateral Agent and the Agent, each Lender has, to the extent permitted by law, a separate right of payment and shall be considered a separate “creditor” holding a separate “claim” within the meaning of Section 101(5) of the Bankruptcy Code or any other insolvency statute.
     In case any one or more of the covenants and/or agreements set forth in this Agreement or any other Loan Document shall have been breached by the Borrower, then the Agent and the Collateral Agent may proceed to protect and enforce the Lenders’ rights by suit in equity and by action at law, including an action for damages as a result of any such breach or an action for specific performance of any such covenant or agreement contained in this Agreement or such other Loan Document. Without limitation of the foregoing, the Borrower agrees that failure to comply with any of the covenants contained herein may cause irreparable harm and that specific performance shall be available as a remedy in the event of any breach thereof. The Agent and Collateral Agent, as the case may be, acting pursuant to this paragraph shall be indemnified by the Borrower against all liability, loss or damage, together with all reasonable costs and expenses related thereto (including reasonable legal and accounting fees and expenses) in accordance with  Section 11.05 .
     In the event a required rescission payment is received in the Collection Account, then the Collateral Agent agrees to release to the Borrower, free and clear of the lien of the Security Agreement, the relevant Lease(s) and Railcar(s) the subject of such rescission payment, to enable the Borrower to comply with its obligation to return such assets to the Seller as described in Section 4.9 of the Purchase and Sale Agreement.
     SECTION 9.03 Priority of Security Interests. Notwithstanding anything contrary contained in this Agreement or any other Loan Document, the Borrower, the Collateral Agent, the Agent and each other Protected Parties (for purposes of this Section 9.03 , the term “Protected Parties” shall not included the Servicer) acknowledge and agree that any Liens on the Collateral regardless of how or when acquired, whether by grant, statute, operation of law, subrogation, purchase money obligations or otherwise that are granted to or held by, the Lenders, other Protected Parties or the Collateral Agent for the benefit of the Lenders and such Protected Parties, shall be a “first” priority security interest and shall be senior to all other security interests. Notwithstanding any other provision of this Agreement (including the Lien priorities set forth herein), all proceeds from Collateral shall be applied against all or any part of the
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Obligations as set forth in Section 2.07(c)(i), Section 2.07(c)(ii) or Section 2.07(c)(iii), as applicable.
ARTICLE X
AGENCY PROVISIONS
     SECTION 10.01 Appointment; Authorization. (a) Appointment. Each Lender hereby designates and appoints DVB Bank AG, as Agent of such Lender to act as specified herein and in the other Loan Documents, and each such Lender hereby authorizes the Agent, as the agent for such Lender, to take such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated by the terms hereof and of the other Loan Documents, together with such other powers as are reasonably incidental thereto, including but not limited to the appointing of the Collateral Agent under the Security Agreement. Notwithstanding any provision to the contrary elsewhere herein and in the other Loan Documents, the Agent shall not have any duties or responsibilities, except those expressly set forth herein and therein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any of the other Loan Documents, or shall otherwise exist against the Agent. In performing its functions and duties under this Agreement and the other Loan Documents, the Agent shall act solely as an agent of the Lenders and does not assume and shall not be deemed to have assumed any obligation or relationship of agency or trust with or for the Borrower. Without limiting the generality of the foregoing two sentences, the use of the term “agent” herein and in the other Loan Documents with reference to the Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any Applicable Law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties. The provisions of this  Article X  (other than  Section 10.09 ) are solely for the benefit of the Agent and the Lenders, and neither the Borrower nor the Collateral Agent shall have any rights as a third party beneficiary of the provisions hereof (other than  Section 10.09 ).
     (b) Collateral Documents. Without limiting the generality of clause (a) of this Section 10.01, each Lender hereby further authorizes the Agent to appoint Wilmington Trust Company as Collateral Agent and Depositary to enter into any Collateral Document as secured party on behalf of and for the benefit of such Lender or otherwise and to require the delivery of any Collateral Document which the Agent determines is necessary or advisable to protect or perfect the interests of the Protected Parties in any Collateral and agrees to be bound by the terms of each of the Collateral Documents. Anything contained in any of the Loan Documents to the contrary notwithstanding, but subject to  Section 11.08 , each Lender agrees that no Lender shall have any right individually to realize upon any of the Collateral under any Collateral Document or Loan Document, it being understood and agreed that all powers, rights and remedies under the Collateral Documents may be exercised solely by the Agent (or its designee, including the Collateral Agent and the Depositary) for the benefit of Protected Parties in accordance with the terms thereof. Each Lender hereby authorizes the Agent (or its designee, including the Collateral Agent and the Depositary) (a) to release or subordinate Collateral as permitted or required under this Agreement or the Collateral Documents, and agrees that a certificate or other instrument executed by the Agent or Collateral Agent evidencing such release of Collateral shall be
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conclusive evidence of such release as to any third party and (b) except as otherwise expressly provided in Section 11.01 hereof, to enter into any amendments or waivers of the Collateral Documents which the Agent determines are necessary or advisable including, without limitation, Collateral Documents the form of which are exhibits to this Agreement.
     SECTION 10.02 Delegation of Duties. The Agent and Collateral Agent may execute any of their respective duties hereunder or under the other Loan Documents by or through agents, employees or attorneys-in-fact and shall be entitled to advice of counsel and other consultants or experts concerning all matters pertaining to such duties. Neither the Agent nor the Collateral Agent shall be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it in the absence of gross negligence or willful misconduct.
     SECTION 10.03 Exculpatory Provisions. Neither the Agent nor the Collateral Agent, nor any of their respective directors, officers, employees or agents, shall be (i) liable for any action lawfully taken or omitted to be taken by any of them under or in connection herewith or in connection with any of the other Loan Documents or the transactions contemplated hereby or thereby (except for its own gross negligence or willful misconduct in connection with its duties expressly set forth herein) or (ii) responsible in any manner to any of the Lenders or participants for any recitals, statements, representations or warranties made by any of the Facility Parties contained herein or in any of the other Loan Documents or in any certificate, report, document, financial statement or other written or oral statement referred to or provided for in, or received by the Agent or the Collateral Agent under or in connection herewith or in connection with the other Loan Documents, or enforceability or sufficiency therefor of any of the other Loan Documents, or for any failure of any Facility Party to perform its obligations hereunder or thereunder or be required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained herein or therein or as to the use of the proceeds of the Loans or of the existence or possible existence of any Default or Event of Default or to inspect the properties, books or records of the Facility Parties.
     SECTION 10.04 Reliance on Communications. Each of the Agent and the Collateral Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex, teletype or e-mail message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to any of the Facility Parties, independent accountants and other experts selected by the Agent in the absence of gross negligence or willful misconduct). The Agent may deem and treat each Lender as the owner of its interests hereunder for all purposes unless a written notice of assignment, negotiation or transfer thereof shall have been filed with the Agent in accordance with  Section 11.06(b) . Each of the Agent and the Collateral Agent shall be fully justified in failing or refusing to take any action under this Agreement or under any of the other Loan Documents unless it shall first receive such advice or concurrence of all the Lenders (to the extent specifically provided in  Section 11.03 ), Required Lenders or Supermajority Lenders, as the case may be, as it deems appropriate or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. Each of the Agent and the Collateral Agent shall in all cases be fully protected in acting, or in refraining from acting, hereunder or under any of the other
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Loan Documents in accordance with a request of all the Lenders (to the extent specifically provided in Section 11.03), Required Lenders or Supermajority Lenders, as the case may be, and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders (including their successors and assigns). Where this Agreement expressly permits or prohibits an action unless all the Lenders (to the extent specifically provided in  Section 11.03 ), Required Lenders or Supermajority Lenders, as the case may be, otherwise determine, each of the Agent and the Collateral Agent shall, and in all other instances each of the Agent and the Collateral Agent may, but shall not be required to, initiate any solicitation for the consent or vote of the Lenders.
     SECTION 10.05 Notice of Default. The Agent shall not be deemed to have Knowledge or notice of the occurrence of any Amortization Event, Default, Servicer Replacement Event or Event of Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Agent for the accounts of the Lenders, unless the Agent has received notice from a Lender, the Servicer or the Borrower referring to this Agreement or the Servicing Agreement, as applicable, describing such Amortization Event, Default, Servicer Replacement Event or Event of Default and stating that such notice is a “notice of default” or a “notice of amortization event,” as the case may be. If the Agent receives such a notice, the Agent shall give prompt notice thereof to the Lenders. Each of the Agent and the Collateral Agent shall take such action with respect to such Amortization Event, Default, Servicer Replacement Event or Event of Default as shall be reasonably directed by the Required Lenders (in the case of an Amortization Event), the Supermajority Lenders (in the case of a Servicer Replacement Event) or the Required Lenders (in the case of a Default or Event of Default);  provided ,  however , that unless and until the Agent or Collateral Agent, as the case may be, has received any such direction, the Agent or the Collateral Agent, as the case may be, may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default, Servicer Replacement Event or Event of Default or it shall deem advisable or in the best interest of the Lenders.
     SECTION 10.06 Credit Decision; Disclosure of Information by Agent or Collateral Agent. Each Lender expressly acknowledges that neither the Agent nor the Collateral Agent has made any representations or warranties to it and that no act by the Agent or Collateral Agent hereinafter taken, including any consent to and acceptance of any assignment or review of the affairs of any Facility Party or any Affiliate thereof, shall be deemed to constitute any representation or warranty by the Agent or Collateral Agent to any Lender as to any matter, including whether the Agent or Collateral Agent has disclosed material information in its possession. Each Lender represents to the Agent and Collateral Agent that it has, independently and without reliance upon the Agent, the Collateral Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, assets, operations, property, financial and other condition, prospects and creditworthiness of the Facility Parties, and all requirements of Applicable Law, and made its own decision to make its Loans hereunder and enter into this Agreement. Each Lender also represents that it will, independently and without reliance upon the Agent, the Collateral Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deems necessary to inform itself as to the business, assets, operations, property, financial and other conditions, prospects and creditworthiness of the Borrower and the
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other Facility Parties. Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Agent or Collateral Agent hereunder, neither the Agent nor the Collateral Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, assets, property, financial or other conditions, prospects or creditworthiness of any Facility Party or their respective Affiliates which may come into the possession of the Agent or Collateral Agent, as the case may be.
     SECTION 10.07 Indemnification. Whether or not the transactions contemplated hereby are consummated, the Lenders agree, severally but not jointly, to indemnify the Agent and the Collateral Agent (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably according to their respective Commitments (or if the Commitments have expired or been terminated, in accordance with the respective principal amounts of outstanding Loans of the Lenders), from and against any and all Indemnified Liabilities which may at any time (including without limitation at any time following payment in full of the Obligations) be imposed on, incurred by or asserted against the Agent or the Collateral Agent in each of their respective capacities as such in any way relating to or arising out of this Agreement or the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by the Agent or Collateral Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment to the Agent or Collateral Agent of any portion of such Indemnified Liabilities resulting from such Person’s gross negligence or willful misconduct;  provided ,  however , that no action taken in accordance with the directions of the Required Lenders or Supermajority Lenders, as the case may be, shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section. If any indemnity furnished to the Agent or Collateral Agent for any purpose shall, in the opinion of the Agent or Collateral Agent, as the case may be, be insufficient or become impaired, each of the Agent or Collateral Agent may call for additional indemnity and cease, or not commence, to do the acts indemnified against until such additional indemnity is furnished. Without limitation of the foregoing, each Lender shall reimburse each of the Agent and Collateral Agent upon demand for its ratable share of any costs or out-of-pocket expenses (including fees and disbursements of counsel) incurred by each of the Agent and Collateral Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or referred to herein, to the extent that the Agent or Collateral Agent is not reimbursed for such expenses by or on behalf of the Borrower. The agreements in this Section shall survive the payment of the Obligations and all other obligations and amounts payable hereunder and under the other Loan Documents.
     SECTION 10.08 Agent and Collateral Agent in Their Individual Capacities. The Agent, the Collateral Agent and their respective Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, acquire Equity Interests in, and generally engage in any kind of banking, trust, financial advisory, underwriting and other business with the Borrower or any other Facility Party as though the Agent or Collateral Agent were not the Agent or Collateral Agent hereunder or under another Loan Document. The Lenders acknowledge that, pursuant to any such activities, the Agent or its Affiliates may receive information regarding any Facility Party or its Affiliates (including information that may be subject to confidentiality obligations in
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favor of such Facility Party or such Affiliate) and acknowledge that neither the Agent nor the Collateral Agent shall not be under any obligation to provide such information to them. With respect to the Loans made by and all obligations owing to it, each of the Agent and the Collateral Agent shall have the same rights and powers under this Agreement as any Lender and may exercise the same as though it was not the Agent or Collateral Agent, and the terms “Lender” and “Lenders” shall include the Agent or Collateral Agent, as the case may be, in their respective individual capacities.
     SECTION 10.09 Term; Successor Agents. The Agent may (i) resign upon 30 days’ written notice to the Lenders, the Borrower and the Servicer, and (ii) be removed as Agent upon the request of the Supermajority Lenders. If the Agent resigns under a Loan Document, the Supermajority Lenders shall appoint from among the Committed Lenders a successor Agent, which successor Agent, if other than a Lender, shall be consented to by the Borrower at all times other than during the existence of an Event of Default (which consent of the Borrower shall not be unreasonably withheld or delayed). If no successor Agent shall have been so appointed by the Supermajority Lenders, and shall have accepted such appointment prior to the effective date of the resignation of the resigning Agent, then the resigning Agent, after consulting with the Lenders and the Borrower shall appoint a successor Agent;  provided ,  however , such successor Agent is a Lender hereunder or a commercial bank organized under the laws of the United States and has a combined capital and surplus of at least $500,000,000. If no successor Agent is appointed prior to the effective date of the resignation of the resigning Agent, the resigning Agent may appoint, after consulting with the Lenders and the Borrower, a successor Agent, from among the Lenders. Upon the acceptance of any appointment as an Agent hereunder by a successor, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent, and the retiring Agent, shall be discharged from its duties and obligations as an Agent, as appropriate, under this Agreement and the other Loan Documents and the provisions of this  Section 10.09  shall inure to its benefit as to any actions taken or omitted to be taken by it while it was an Agent under this Agreement. If no successor Agent has accepted appointment as Agent within 60 days after the retiring Agent’s giving notice of resignation, the retiring Agent’s resignation shall nevertheless become effective and the Lenders shall perform all duties of the Agent hereunder until such time, if any, as the Supermajority Lenders appoint a successor Agent as provided for above.
     SECTION 10.10 Request for Documents. Each of the Agent and the Collateral Agent shall from time to time upon reasonable request therefor furnish each Lender with copies of the Funding Package, Railcar Documentation, Lease Documents and/or Loan Documents (to the extent such Funding Package, Railcar Documentation, Lease Documents and/or Loan Documents are provided by the Borrower or other third parties, in the form and to the extent provided to the Agent or the Collateral Agent by the Borrower or such third parties).
ARTICLE XI
MISCELLANEOUS
     SECTION 11.01 Notices and Other Communications. (a) General. Unless otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including by facsimile transmission) and mailed, faxed or delivered, to the address,
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facsimile number or electronic mail address specified for notices as set forth on Schedule 11.01 or at such other address as shall be designated by such party in a notice to the Borrower and the Agent. All such notices and other communications shall be deemed to be given or made upon the earlier to occur of (i) actual receipt by the intended recipient and (ii) (A) if delivered by hand or by courier, when signed for by the intended recipient; (B) if delivered by mail, four Business Days after deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent and receipt has been confirmed by telephone; and (D) if delivered by electronic mail, when sent and confirmed by a copy sent by the methods described in  (A) ,  (B)  or  (C)  above; provided, however, that notices and other communications to the Agent pursuant to Article II shall not be effective until actually received by such Person. Any notice or other communication permitted to be given, made or confirmed by telephone hereunder shall be given, made or confirmed by means of a telephone call to the intended recipient at the number specified on  Schedule 11.01 , it being understood and agreed that a voicemail message shall in no event be effective as a notice, communication or confirmation hereunder.
     (b) Effectiveness of Facsimile Documents and Signatures. Loan Documents may be transmitted and/or signed by facsimile. The effectiveness of any such documents and signatures shall, subject to requirements of Applicable Law, have the same force and effect as manually-signed originals and shall be binding on all Facility Parties, the Agent, the Collateral Agent and the Lenders. The Agent may also require that any such documents and signatures be confirmed by a manually-signed original thereof; provided, however, that the failure to request or deliver the same shall not limit the effectiveness of any facsimile document or signature.
     (c) Reliance by Agent, Collateral Agent and Lenders. The Agent, the Collateral Agent and the Lenders shall be entitled to rely and act upon any notices purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Borrower shall indemnify the Agent, Collateral Agent and each Lender from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrower. All telephonic notices to and other communications with the Agent may be recorded by the Agent, and each of the parties hereto hereby consents to such recording.
     SECTION 11.02 No Waiver; Cumulative Remedies. No failure or delay on the part of the Agent, Collateral Agent or any Lender in exercising any right, power or privilege hereunder or under any other Loan Document and no course of dealing between the Agent, Collateral Agent or any Lender and any of the Facility Parties shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or under any other Loan Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder or thereunder. The rights and remedies provided herein are cumulative and not exclusive of any rights or remedies which the Agent, Collateral Agent or any Lender would otherwise have. No notice to or demand on any Facility Party in any case shall entitle the Facility Parties to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Agent, Collateral Agent or the Lenders to any other or further action in any circumstances without notice or demand.
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     SECTION 11.03 Amendments, Waivers and Consents. Neither this Agreement nor any other Loan Document nor any of the terms hereof or thereof may be amended, changed, waived, discharged or terminated except, (a) in the case of this Agreement, upon the Agent requesting from each Rating Agency (if any) a determination whether, as a result of any such amendment (except for changes to the definition of “Initial Principal Amount,” “Expected Maturity Date,” “Term Maturity Date” or “Legal Final Maturity Date” or the dates on which payments are due pursuant to Section 2.06  or  Section 2.07 , or other changes or agreements in respect of the subject matter herein which are, in the judgment of the Agent, ministerial or address mechanical matters not raising any substantive credit-related concerns, including in respect of such repayment and release matters associated with Asset Dispositions under  Section 7.05 ), it would cause the rating of the Notes to be reduced or withdrawn and (b) in the case of this Agreement or any other Loan Document, pursuant to an agreement or agreements or a consent or consents in writing entered into by the Borrower, each other Facility Party which is party thereto, the Supermajority Lenders, and the Agent;  provided  that the foregoing shall not restrict the ability of the Supermajority Lenders to waive any Event of Default prior to the time the Agent shall have declared, or the Required Lenders shall have requested the Agent to declare, the Loans immediately due and payable pursuant to  Article IX ;  provided ,  however , that:
     (i) no such amendment, change, waiver, discharge or termination shall, without the consent of each Lender affected thereby:
     (A) extend the Legal Final Maturity Date or any payment of the Loans due thereon; provided that this clause (A) shall not restrict the ability of the Supermajority Lenders to waive any Event of Default (other than an Event of Default the waiver of which would effectively result in any such extension or waiver), prior to the time the Agent shall have declared, or the Required Lenders shall have requested the Agent to declare, the Loans immediately due and payable pursuant to Article IX;
     (B) reduce the rate, or extend the time of payment, of interest (other than as a result of waiving the applicability of any post-default increase in interest rates) thereon or fees hereunder;
     (C) reduce or waive the principal amount of any Loan;
     (D) increase the Commitment of a Lender over the amount thereof in effect (it being understood and agreed that a waiver of any Default, Servicer Event, Servicer Replacement Event or Event of Default or a mandatory reduction in the Commitments shall not constitute a change in the terms of any Commitment of any Lender);
     (E) release all or substantially all or less than all of the Collateral securing the Credit Obligations hereunder (provided that the Collateral Agent may, without consent from any other Lender, release any Collateral that is sold or transferred by the Borrower in compliance with  Section 7.05 , or released in compliance with Section 9.12 of the Security Agreement);
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     (F) release any amounts from the Liquidity Reserve Account other than in accordance with Section 2.07(c), Section 2.07(d)  or  Section 6.14(c) ;
     (G) release any Facility Party from its respective obligations under the Loan Documents and/or the Servicing Documents;
     (H) amend, modify or waive any provision of this Section 11.03 or reduce any percentage specified in, or otherwise modify, the definition of Required Lenders or Supermajority Lenders;
     (I) amend or modify or, if applicable, waive the effects of the definition of “Advance Rate” and/or “Concentration Excess Amount”; or
     (J) consent to the assignment or transfer by the Borrower or the Servicer of any of its rights and obligations under (or in respect of) the Loan Documents and the Servicing Agreement, except as permitted thereby.
     (K) amend or modify or, if applicable, waive the effects of the definition of “Term Maturity Date” and/or “Expected Maturity Date”;
     (L) amend, modify or waive any provision of Section 2.07(c); or
     (M) amend, modify or waive any provision of Section 2.10.
     (ii) no provision of Article X may be amended without the consent of the Agent.
     Notwithstanding the fact that the consent of all the Lenders is required in certain circumstances as set forth above, (i) each Lender is entitled to vote as such Lender sees fit on any bankruptcy reorganization plan that affects the Loans, and each Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy Code supersede the unanimous consent provisions set forth herein and (ii) the Supermajority Lenders may consent to allow the Borrower to use cash collateral in the context of a bankruptcy or insolvency proceeding.
     No amendment to (i) the definitions of “Creditor,” “Derivatives Agreement,” “Derivatives Creditor,” “Derivatives Creditor Event,” “Derivatives Obligations,” “Derivatives Termination Value,” “Obligations” or “Protected Party” contained in  Section 1.01  and in the definition of “Secured Obligations” in Section 1.01 of the Security Agreement, (ii)  Section 2.07(c) , (iii) Section 9.01 , (iv)  Section 9.03 , (v) this paragraph of  Section 11.03 , (vi)  Section 11.17 , (vii)  Section 9.06  of the Security Agreement and (viii)  Section 9.06  of the Parent Security Agreement only, in each of  clauses (i)  through  (viii) , in a manner that materially adversely affects a Derivatives Creditor, shall be effective without the written concurrence of such Derivatives Creditor and no addition of any new provision to this Agreement in a manner that impacts any of the sections described in  clauses (i) through  (viii)  of this paragraph only and that materially adversely affect a Derivatives Creditor shall be effective without the written concurrence of such Derivatives Creditor. Prior to any amendment of the sections described in clauses (i) through (vii) of this paragraph, the Agent shall provide ten (10) Business Days written notice to the Derivatives Creditors.
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     The various requirements of this Section 11.03 are cumulative. Each Lender and each holder of a Note shall be bound by any waiver, amendment or modification authorized by this  Section 11.03  regardless of whether its Note shall have been marked to make reference therein, and any consent by any Lender or holder of a Note pursuant to this  Section 11.03  shall bind any Person subsequently acquiring a Note from it, whether or not such Note shall have been so marked.
     SECTION 11.04 Expenses. The Borrower shall pay promptly on demand, but in any event by the next Settlement Date following demand, all out-of-pocket expenses (including, without limitation, all reasonable attorneys’ fees and expenses) incurred by the Agent (and its Affiliates), the Collateral Agent and the Committed Lenders: (i) in connection with the preparation, execution, delivery, administration, modification and amendment of the Loan Documents and in connection with the Borrowing including, without limitation, (A) due diligence, collateral review, syndication, transportation, computer, duplication, audit, insurance, consultant, search, filing and recording fees and expenses and (B) the reasonable fees and expenses of counsel for each of the Agent and the Collateral Agent with respect thereto, with respect to advising the Agent or the Collateral Agent as to its rights and responsibilities, or the perfection, protection or preservation of rights and interests, under the Loan Documents and Lease Documents, (ii) in connection with wire transfers to be made by the Agent or Collateral Agent in connection with the distribution of proceeds under this Agreement and (iii) in connection with any amendment, refinancing, modification, supplement (or, if related to a request by any Facility Party or any Lessee, interpretation), or waiver under any of the Notes or other Loan Documents and Lease Documents whether or not such amendment, refinancing, modification, supplement, interpretation or waiver is obtained or becomes effective, and in connection with the consideration of any potential, actual or proposed restructuring or workout of the transactions contemplated hereby or by the other Loan Documents.
     The Borrower shall pay promptly on demand, but in any event by the next Settlement Date following demand, (i) all reasonable filing fees and attorneys’ fees and expenses incurred by the Collateral Agent, the Agent and the Lenders and all reasonable fees and expenses of special STB or other collateral or regulatory counsel (and other local counsel reasonably engaged by the Collateral Agent or the Agent), as the case may be, in connection with the preparation and review of the Collateral Documents and the other Loan Documents and Lease Documents from time to time entered into or reviewed pursuant to this Agreement and all documents related thereto, the search of railcar conveyance and Lien records, the recordation of documents with the STB or other applicable Governmental Authority, inspection and appraisal fees and the making of the Loans hereunder, whether or not the Closing Date or other transaction contemplated hereby closes and (ii) all taxes which the Collateral Agent or any Protected Party may be required to pay solely by reason of the security interests granted in the Collateral (including any applicable transfer taxes) or to free any of the Collateral from the lien thereof.
     In addition, the Borrower shall pay promptly on demand, but in any event by the next Settlement Date following demand, all reasonable out of pocket expenses (including, without limitation, reasonable attorneys’ fees and expenses and fees and expenses of any expert witnesses) incurred by the Agent, the Collateral Agent and the Lenders in connection with the enforcement and protection of the rights of the Agent, the Collateral Agent and the Lenders under any of the Loan Documents and any amendments thereto and waivers thereof and any
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Servicer Replacement Event, Default or Event of Default, including without limitation, the performance by the Agent, the Collateral Agent or the Lenders of any act any Facility Party has covenanted to do under the Loan Documents and/or the Servicing Documents to the extent such Facility Party fails to comply with any such covenant.
     The Borrower shall pay all fees and expenses in connection with the Depository Agreement including, without limitation, all fees (including any annual fee payable to the Depositary pursuant to the Depository Agreement), expenses and any indemnity payments to the Depositary and all fees and expenses in creating, maintaining and administrating the Accounts.
     SECTION 11.05 Indemnification. Whether or not the transactions contemplated hereby are consummated, the Borrower agrees to indemnify, save and hold harmless the Agent, the Collateral Agent, each Lender, each Derivatives Creditor, each Support Party and their respective Affiliates, directors, officers, employees, counsel, agents and attorneys-in-fact (collectively the “ Indemnitees ”) from and against (and without duplication of amounts payable or the provisions which relate to such payment under the other provisions of the Loan Documents): (i) any and all claims, demands, actions or causes of action that are asserted against any Indemnitee by any Person (other than the Agent, the Collateral Agent or any Lender) relating directly or indirectly to a claim, demand, action or cause of action that such Person asserts or may assert against Trinity or any Facility Party, any Affiliate of Trinity or any Facility Party or any of their respective officers, managers or directors; (ii) any and all claims, demands, actions or causes of action that may at any time (including at any time following repayment of the Obligations and the resignation or removal of the Agent, the Collateral Agent or the replacement of any Lender) be asserted or imposed against any Indemnitee, arising out of or relating to, the Loan Documents, any predecessor Loan Documents, the Commitments, the use of or contemplated use of the proceeds of any Loan, or the relationship of Trinity, any Facility Party, the Agent and the Lenders under this Agreement or any other Loan Document; (iii) any administrative or investigative proceeding by any Governmental Authority arising out of or related to a claim, demand, action or cause of action described in  clause (i)  or  (ii) above; (iv) any Loan Document, Lease Document, other Transaction Document or any document contemplated hereby or thereby and payments made pursuant hereto or thereto or any transaction contemplated hereby or thereby or the exercise of rights and remedies hereunder or thereunder, any breach by Trinity or any Facility Party of any Transaction Document or Lease Document or a Lessee of any Lease Document, (v) any Railcar, any Part or the Borrower’s acquisition or ownership of, or the selection, design, financing, lease, control, operation, condition, location, storage, modification, repair, sale, use, maintenance, possession, registration, delivery, nondelivery, transportation, transfer or disposition of, any Railcar or Part; (vi) any liability arising under or in respect of any Environmental Law, in each case relating to any Railcar or the use, operation or ownership thereof, whether by Trinity or any Facility Party, any Lessee or any other Person; (vii) any and all liabilities, obligations, losses, damages, penalties, claims, demands, actions, suits, judgments, costs and expenses of any kind, including, without limitation, the reasonable fees and disbursements of counsel, which may be incurred by, imposed on or asserted against such Indemnitee in connection with any investigation or administrative or judicial proceeding (whether or not such Indemnitee) shall be designated a party thereto) brought or threatened relating to or arising out of any Collateral Document or in any other way connected with the enforcement of any of the terms of, or the presentation of any rights under, or in any way relating to or arising out of the manufacture, ownership, ordering, purchasing, delivery, control,
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acceptance, lease, financing, possession, operation, condition, sale, return or other disposition or use of the Collateral (including, without limitation, intent or other defects, whether or not discoverable) the violation of any laws of any country, state or other governmental body or unit, or any tort (including, without limitation, any claims, arising or imposed under the doctrine of strict liability, or for or on account of injury to or the death of any Person (including any Indemnities), or property damage or contract claim; and (viii) any and all liabilities (including liabilities under indemnities), losses, costs or expenses (including fees and disbursements of one legal counsel, collectively, of the Indemnitees other than the Agent and the Collateral Agent, and one legal counsel of each of the Agent and the Collateral Agent) that any Indemnitee suffers or incurs as a result of the assertion of any foregoing claim, demand, action, cause of action or proceeding, or as a result of the preparation of any defense in connection with any foregoing claim, demand, action, cause of action or proceeding, in all cases, and whether or not an Indemnitee is a party to such claim, demand, action, cause of action, or Proceeding (all the foregoing, collectively; the “ Indemnified Liabilities ”).  THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND COSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY OR CAUSED, IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR OMISSION OF ANY KIND BY ANY INDEMNITEE ;  provided  that no Indemnitee shall be entitled to indemnification for any claim caused by its own breach, gross negligence or willful misconduct and provided further, that no Indemnitee shall be entitled to indemnification for any claim arising solely out of (i) the bankruptcy, insolvency or other financial inability of one or more Lessees to make payments under a related Lease or (ii) the decline in market value of a Portfolio Railcar, to the extent not attributable to the failure of a Facility Party to perform an obligation with respect to such Portfolio Railcar under a Transaction Document;  provided ,  further , that no Indemnitee shall be entitled to indemnification under this Section 11.05  in respect of (a) Taxes, Other Taxes, and the enumerated items excluded from the definition of “Taxes” under  Section 3.01(a)  or (b) losses which result from or arise out of or are attributable to a non-exempt prohibited transaction under ERISA or Section 4975 of the Code cause by the incorrectness of a Lender’s representation in Section 8.01  or a breach of a Lender’s covenant in  Section 8.03 . In the case of an investigation, litigation or other proceeding to which the indemnity in this  Section 11.05  applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by Trinity, any Facility Party, their respective directors, shareholders or creditors or an Indemnitee or any other Person or any Indemnitee is otherwise a party thereto and whether or not the transactions contemplated hereby are consummated. The Borrower agrees not to assert any claim against the Agent, the Collateral Agent, any Lender, any Derivatives Creditor, any Support Party, any of their Affiliates or any of their respective directors, officers, employees, attorneys, agents and advisers, on any theory of liability, for special, indirect, consequential or punitive damages arising out of or otherwise relating to the Loan Documents, any of the transactions contemplated herein or therein or the actual or proposed use of the proceeds of the Loans. Without prejudice to the survival of any other agreement of the Borrower hereunder and under the other Loan Documents, the agreements and obligations of the Borrower contained in this  Section 11.05  shall survive the repayment of the Loans and other obligations under the Loan Documents and the termination of the Commitments hereunder.
     The Borrower shall, no later than 20 days following demand, reimburse any Indemnitee for any Indemnified Liability referred to above or, upon request from any Indemnitee, shall pay
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such amounts directly. Any payment made to or on behalf of any Indemnitee pursuant to this Section 11.05 shall be adjusted to such amount as will, after taking into account all Taxes imposed with respect to the accrual or receipt of such payment (as the same may be increased pursuant to this sentence), equal the amount of the payment. To the extent that the Borrower in fact indemnifies any Indemnitee pursuant to the provisions of this  Section 11.05  (other than in respect of Taxes), the Borrower shall be subrogated to such Indemnitee’s rights in the affected transaction and shall have a right to determine the settlement of claims therein.
     If a claim of the type described above is made against an Indemnitee and such Indemnitee has notice thereof, such Indemnitee shall promptly, upon receiving such notice, give notice of such claim to the Borrower;  provided  that the failure to provide such notice shall not release the Borrower from any of its obligations hereunder except if and to the extent that such failure results in an increase in the Borrower’s indemnification obligations hereunder. The Borrower shall be entitled, in each case at its sole cost and expense, acting through counsel reasonably acceptable to the relevant Indemnitee: (i) in any judicial or administrative proceeding that involves solely a claim of the type described above, to assume responsibility for and control thereof, (ii) in any judicial or administrative proceeding involving a claim of the type described above and other claims related or unrelated to the transactions contemplated by this Agreement or any other Loan Document (other than with respect to Taxes), to assume responsibility for and control of such claim, to the extent that the same may be and is severed from such other claims (and such Indemnitee shall use its best efforts to obtain such severance), and (iii) in any other case, to be consulted by such Indemnitee with respect to judicial proceedings subject to the control of such Indemnitee. Notwithstanding anything in the foregoing to the contrary, the Borrower shall not be entitled to assume responsibility for and control of any such judicial or administrative proceedings: (A) while an Event of Default shall have occurred and be continuing; (B) if such proceedings will involve any risk of criminal liability or a material risk of the sale, forfeiture or loss of any part of the Collateral; or (C) to the extent that the Indemnitee has defenses available to it which are not available to the Borrower and allowing the Borrower to assert such defenses will be prejudicial to the interests of such Indemnitee;  provided  that the limitation on the Borrower’s ability to control such judicial or administrative proceeding shall apply only to those aspects of such proceeding which address issues with respect to which such defenses are available.
     The relevant Indemnitee shall supply the Borrower with such information reasonably requested by the Borrower as is necessary or advisable for the Borrower to control or participate in any proceeding to the extent permitted by this  Section 11.05 . Such Indemnitee shall not enter into a settlement or other compromise with respect to any covered claim without the prior written consent of the Borrower, which consent shall not be unreasonably withheld or delayed, unless such Indemnitee waives its right to be protected with respect to such covered claim.
     SECTION 11.06 Successors, Assigns, and Participants. (a) Generally. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective successors and assigns of the parties hereto;  provided  that the Borrower may not assign or transfer any of its interests and obligations without the prior written consent of either the Supermajority Lenders or the Lenders, as the terms set forth in  Section 11.03  may require.
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     (b) Assignments. Any Lender may assign all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Loans and its Commitments);  provided ,  however , that
     (i) each such assignment shall be to an Eligible Assignee who, unless otherwise consented to by the Borrower, is not a Competitor of the Borrower;
     (ii) no Lender may at any time assign such rights and obligations without the prior written consent of the Agent, which shall not be unreasonably withheld or delayed, and without prior written notice to the Borrower;
     (iii) except in the case of an assignment to another Lender, an Affiliate of an existing Lender or any Approved Fund, (1) such assignee shall acquire all of the outstanding Loans of the assigning Lender, or (2) such assignee shall acquire (and such assignor shall retain) in the aggregate upon any such assignment by one or more Lenders a minimum amount of Loans with an aggregate original (as of the Closing Date) principal balance of at least $10,000,000 (but in no event Loans with a then aggregate current principal balance of less than $5,000,000, unless an Event of Default, a Default described in  Section 9.01(g)(ii)  or Servicer Replacement Event has occurred and is continuing, in which case $1,000,000 of the then aggregate current principal balance shall be the minimum amount);
     (iv) the parties to such assignment shall execute and deliver to the Agent for its acceptance an Assignment and Acceptance in the form of  Exhibit C , together with any Note subject to such assignment and a processing fee of $3,500, payable or agreed between the assigning Lender and the assignee; and
     (v) the Borrower shall not be required to reimburse any such assignee pursuant to Section 3.01, 3.03 or 3.04 in an amount which exceeds the amount that would have been payable thereunder to the assigning Lender had such Lender not entered into such assignment.
     (c) Assignment and Acceptance. By executing and delivering an Assignment and Acceptance in accordance with this Section 11.06 , the assigning Lender thereunder and the assignee thereunder shall be deemed to confirm to and agree with each other and the other parties hereto as follows: (i) such assigning Lender warrants that it is the legal and beneficial owner of the interest being assigned thereby free and clear of any adverse claim and the assignee warrants that it is an Eligible Assignee; (ii) except as set forth in  clause (i)  above, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement, any of the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto, or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement, any of the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto or the financial condition of the Facility Parties or the performance or observance by any Facility Party of any of its obligations under this Agreement, any of the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto; (iii) such assignee represents and warrants that it is legally authorized to enter into such
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assignment agreement; (iv) such assignee confirms that it has received a copy of this Agreement, the other Loan Documents, together with copies of the most recent financial statements delivered pursuant to  Section 6.01  and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Assignment and Acceptance; (v) such assignee will independently and without reliance upon the Agent, the Collateral Agent, such assigning Lender or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement and the other Loan Documents; (vi) such assignee appoints and authorizes each of the Agent and the Collateral Agent to take such action on its behalf and to exercise such powers under this Agreement or any other Loan Document as are delegated to each of the Agent and the Collateral Agent by the terms hereof or thereof, together with such powers as are reasonably incidental thereto; and (vii) such assignee agrees that it will perform in accordance with their terms all the obligations which by the terms of this Agreement and the other Loan Documents are required to be performed by it as a Lender. Upon execution, delivery, and acceptance of such Assignment and Acceptance, the assignee thereunder shall be a party hereto and, to the extent of such assignment, have the obligations, rights, and benefits of a Lender hereunder and the assigning Lender shall, to the extent of such assignment, relinquish its rights and be released from its obligations under this Agreement. Upon the consummation of any assignment pursuant to this  Section 11.06(c) , the assignor, the Agent and the Borrower shall make appropriate arrangements so that, if required, new Notes are issued to the assignor and the assignee. If the assignee is not a United States person under Section 7701(a)(30) of the Code, it shall deliver to the Borrower and the Agent certification as to exemption from deduction or withholding of Taxes in accordance with Section 3.01 .
     (d) Register. The Borrower hereby designates the Agent to serve as the Borrower’s agent, solely for purposes of this Section 11.06(d) , to (i) maintain a register (the “ Register ”) on which the Agent will record the Commitments from time to time of each Lender, the Loans made by each Lender and each repayment in respect of the principal amount of the Loans of each Lender and to (ii) retain a copy of each Assignment and Acceptance delivered to the Agent pursuant to this Section. Failure to make any such recordation, or any error in such recordation, shall not affect the Borrower’s obligation in respect of such Loans. The entries in the Register shall be conclusive, in the absence of manifest error, and the Borrower, the Agent and the Lenders shall treat each Person in whose name a Loan and the Note evidencing the same is registered as the owner thereof for all purposes of this Agreement, notwithstanding notice or any provision herein to the contrary. With respect to any Lender, the assignment or other transfer the rights to the principal of, and interest on, any Loan made and any Note issued pursuant to this Agreement shall not be effective until such assignment or other transfer is recorded on the Register and, except to the extent provided in this  Section 11.06(d) , otherwise complies with  Section 11.06 , and prior to such recordation all amounts owing to the transferring Lender with respect to such Loans and Notes shall remain owing to the transferring Lender. The registration of assignment or other transfer of all or part of any Loans and Notes for a Lender shall be recorded by the Agent on the Register only upon the acceptance by the Agent of a properly executed and delivered Assignment and Acceptance and payment of the administrative fee referred to in  Section 11.06(b)(iv) . The Register shall be available at the offices where kept by the Agent for inspection by the Borrower and any Lender at any reasonable time upon reasonable prior notice to the Agent.
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     (e) Participations. Each Lender may, without the consent of the Borrower or the Agent, sell participations to one or more Persons in all or a portion of its rights, obligations or rights and obligations under this Agreement (including all or a portion of the Loans owing to it and any Notes held by it);  provided ,  however , that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, (iii) the participant shall be entitled to the benefit of right of setoff contained in  Section 11.08 and the yield protection provisions contained in  Sections 3.01 ,  3.03  and  3.04  to the same extent that the Lender from which such participant acquired its participation would be entitled to the benefits of such yield protections; provided that the Borrower shall not be required to reimburse any participant pursuant to  Sections 3.01 ,  3.03  or  3.04  in an amount which exceeds the amount that would have been payable thereunder to such Lender had such Lender not sold such participation and (iv) the Borrower, the Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement, and such Lender shall retain the sole right to enforce the obligations of the Borrower relating to the Obligations owing to such Lender and to approve any amendment, modification or waiver of any provision of this Agreement (other than amendments, modifications or waivers decreasing the amount of principal of or the rate at which interest is payable on such Loans or Notes, extending any scheduled principal payment date or date fixed for the payment of interest on such Loans or Notes or extending its Commitment). Each Lender that sells a participating interest in any Loan, Commitment or other interest to a participant shall, as agent for the Borrower solely for the purpose of this  Section 11.06 , record in book entries maintained by such Lender the name and amount of the participating interest of each participant entitled to receive payments in respect of such participating interest.
     (f) Other Assignments. Any Lender may at any time (i) assign all or any portion of its rights under this Agreement and any Loans and Notes to a Federal Reserve Bank, (ii) pledge or assign a security interest in all or any portion of its interest and rights under this Agreement (including all or any portion of its Loans and Notes, if any) to secure obligations of such Lender and (iii) grant to a Conduit Lender referred to in  subsection (g)  below identified as such in writing from time to time by such Lender to the Agent and the Borrower the option to provide to the Borrower all or any part of any Loans that such Lender would otherwise be obligated to make to the Borrower pursuant to the Agreement;  provided  that no such assignment, option, pledge or security interest shall release a Lender from any of its obligations hereunder or substitute any such Federal Reserve Bank or other person to which such option, pledge or assignment has been made for such Lender as a party hereto.
     (g) Conduit Lenders, etc. Notwithstanding anything to the contrary contained herein, any Committed Lender (a “ Granting Lender ”), may grant to a conduit lender sponsored by such Granting Lender, identified as such in writing from time to time by the Granting Lender to the Agent and the Borrower (a “ Conduit Lender ”) the option to fund all or any part of any Loan that such Granting Lender would otherwise be obligated to fund pursuant to this Agreement; provided  that (i) nothing herein shall constitute a commitment by any Conduit Lender to fund any Loan and (ii) if a Conduit Lender elects not to exercise such option or otherwise fails to fund all or any part of such Loan, the Granting Lender shall be obligated to fund such Loan pursuant to the terms hereof. The funding of a Loan by a Conduit Lender hereunder shall utilize the Commitment of the Granting Lender to the same extent that, and as if, such Loan were funded by
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such Granting Lender. Each party hereto hereby agrees that no Conduit Lender shall be liable for any indemnity or payment under this Agreement for which a Lender would otherwise be liable for so long as, and to the extent, the Granting Lender provides such indemnity or makes such payment. Notwithstanding anything to the contrary contained in this Agreement, any Conduit Lender may disclose on a confidential basis any non-public information relating to its funding of Loans to any rating agency, commercial paper dealer or provider of any surety or guarantee to such Conduit Lender. This  subsection (g)  may not be amended without the prior written consent of each Granting Lender, all or any part of whose Loan is being funded by a Conduit Lender at the time of such amendment. Credit Suisse, Cayman Islands Branch, hereby designates Alpine Securitization Corp. as a “Conduit Lender” for all purposes of this Agreement and the other Loan Documents and grants to such Conduit Lender the option to fund all or any portion of the Loans contemplated to be made hereunder by Credit Suisse, Cayman Islands Branch.
     SECTION 11.07 Confidentiality. Each of the Agent, the Collateral Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (i) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (ii) to the extent requested by any regulatory authority with jurisdiction over the Agent, the Collateral Agent or Lender, as applicable; (iii) to the extent required by Applicable Laws or regulations or by any subpoena or similar legal process; (iv) to any other party to this Agreement; (v) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or any other Loan Documents or the enforcement of rights hereunder or thereunder; (vi) subject to an agreement containing provisions substantially the same as those of this Section, to (A) any Eligible Assignee of or participant in, or any prospective Eligible Assignee of or participant in, any of its rights or obligations under this Agreement, (B) any direct or indirect contractual counterparty or prospective counterparty (or such contractual counterparty’s or prospective counterparty’s professional advisor) to any credit derivative transaction relating to obligations of the Borrower or (C) any Support Party or any managing agent of a Lender that is a commercial paper conduit; (vii) with the written consent of the Borrower; (viii) to the extent such information (A) becomes publicly available other than as a result of a breach of this Section or (B) becomes available to the Agent, the Collateral Agent or any Lender on a nonconfidential basis from a source other than the Borrower; or (ix) to the National Association of Insurance Commissioners or any other similar organization or any nationally recognized rating agency that requires access to information about a Lender’s or its Affiliates’ investment portfolio in connection with ratings issued with respect to such Lender or its Affiliates. For the purposes of this Section, “ Information ” means all information received from or on behalf of the Borrower relating to the Borrower or its business, other than any such information that is available to the Agent, the Collateral Agent or any Lender on a nonconfidential basis prior to disclosure by or on behalf of the Borrower. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
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     SECTION 11.08 Set-off. In addition to any rights now or hereafter granted under Applicable Law or otherwise, and not by way of limitation of any such rights, upon the occurrence and during the continuance of an Event of Default, each Lender (and each of its Affiliates) is authorized at any time and from time to time, without presentment, demand, protest or other notice of any kind (all of such rights being hereby expressly waived), to set-off and to appropriate and apply any and all deposits (general or specific) and any other indebtedness at any time held or owing by such Lender (including, without limitation, branches, agencies or Affiliates of such Lender wherever located) to or for the credit or the account of the Borrower against obligations and liabilities of the Borrower to the Lenders hereunder, under the Loans and Notes, under the other Loan Documents or otherwise, irrespective of whether the Agent or the Lenders shall have made any demand hereunder and although such obligations, liabilities or claims, or any of them, may be contingent or unmatured, and any such set-off shall be deemed to have been made immediately upon the occurrence of an Event of Default even though such charge is made or entered on the books of such Lender subsequent thereto. The Borrower hereby agrees that to the extent permitted by law any Person purchasing a participation in the Loans and Commitments hereunder may exercise all rights of set-off with respect to its participation interest as fully as if such Person were a Lender hereunder and any such set-off shall reduce the amount owed by the Borrower to the Lender.
     SECTION 11.09 Interest Rate Limitation. The Agent, the Lenders and the Borrower and any other parties to the Loan Documents intend to contract in strict compliance with applicable usury law from time to time in effect. In furtherance thereof such Persons stipulate and agree that none of the terms and provisions contained in the Loan Documents shall ever be construed to create a contract to pay, for the use, forbearance or detention of money, interest in excess of the maximum amount of interest permitted to be charged by Applicable Law from time to time in effect (the “ Maximum Rate ”). Neither the Borrower nor any present or future guarantors, endorsers, or other Persons hereafter becoming liable for payment of any Credit Obligation shall ever be liable for unearned interest thereon or shall ever be required to pay interest thereon in excess of the maximum amount that may be lawfully charged under Applicable Law from time to time in effect, and the provisions of this section shall control over all other provisions of the Loan Documents which may be in conflict or apparent conflict herewith. The Lenders and the Agent expressly disavow any intention to charge or collect excessive unearned interest or finance charges in the event the maturity of any Credit Obligation is accelerated. If (i) the maturity of any Credit Obligation is accelerated for any reason, (ii) any Credit Obligation is prepaid and as a result any amounts held to constitute interest are determined to be in excess of the legal maximum, or (iii) any Lender of any other holder of any or all of the Credit Obligations shall otherwise collect moneys which are determined to constitute interest which would otherwise increase the interest on any or all of the Credit Obligations to an amount in excess of that permitted to be charged by Applicable Law then in effect, then all sums determined to constitute interest in excess of such legal limit shall, without penalty, be promptly applied to reduce the then outstanding principal of the related Credit Obligations or, at such Lender’s or holder’s option, promptly returned to the Borrower or the other payor thereof upon such determination. In determining whether or not the interest paid or payable, under any specific circumstance, exceeds the maximum amount permitted under Applicable Law, the Agent, the Lenders and the Borrower (and any other payors thereof) shall to the greatest extent permitted under Applicable Law, (i) characterize any non-principal payment as an expense, fee or premium rather than as interest, (ii) exclude voluntary prepayments and the effects thereof, and (iii) amortize, prorate,
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allocate, and spread the total amount of interest throughout the entire contemplated term of the instruments evidencing the Credit Obligations in accordance with the amounts outstanding from time to time thereunder and the maximum legal rate of interest from time to time in effect under Applicable Law in order to lawfully charge the maximum amount of interest permitted under Applicable Law. In the event Applicable Law provides for an interest ceiling under Chapter 303 of the Texas Finance Code (the “ Texas Finance Code ”) as amended, for that day, the ceiling shall be the “weekly ceiling” as defined in the Texas Finance Code;  provided  that if any Applicable Law permits greater interest, the Law permitting the greatest interest shall apply. As used in this  Section 11.09  the term “Applicable Law” includes, without limitation the laws of the State of Texas, the laws of the State of New York or the laws of the United States of America, whichever laws allow the greatest interest, as such laws now exist or may be changed or amended or come into effect in the future.
     SECTION 11.10 Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument. It shall not be necessary in making proof of this Agreement to produce or account for more than one such counterpart.
     SECTION 11.11 Integration. THIS WRITTEN AGREEMENT, TOGETHER WITH THE OTHER LOAN DOCUMENTS, REPRESENTS THE FINAL AGREEMENT OF THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.  In the event of any conflict between the provisions of this Agreement and those of any other Loan Document, the provisions of this Agreement shall control;  provided that the inclusion of supplemental rights or remedies in favor of the Collateral Agent, the Agent or the Lenders in any other Loan Document shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint participation of the respective parties thereto and shall be construed neither against nor in favor of any party, but rather in accordance with the fair meaning thereof.
     SECTION 11.12 Survival of Representations and Warranties. All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Agent, the Collateral Agent and each Lender, regardless of any investigation made by the Agent, the Collateral Agent or any Lender or on their behalf and notwithstanding that the Agent, the Collateral Agent or any Lender may have had notice or Knowledge of any Default or Event of Default at the time of the Borrowing, and shall continue in full force and effect as long as any Loan or any other Obligation shall remain unpaid or unsatisfied.
     SECTION 11.13 Severability. Any provision of this Agreement and the other Loan Documents to which any Facility Party is a party that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions thereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
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     SECTION 11.14 Headings. The headings of the sections and subsections hereof are provided for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.
     SECTION 11.15 Marshalling; Payments Set Aside. None of the Agent, the Collateral Agent or any Lender shall be under any obligation to marshal any assets in favor of the Borrower or any other party or against or in payment of any or all of the Obligations. To the extent that the Borrower makes a payment or payments to the Agent or the Collateral Agent (or to the Agent for the benefit of the Lenders, or to the Collateral Agent for the benefit of the Protected Parties), or the Agent or the Collateral Agent enforces any security interests or exercises its rights of set-off, and such payment or payments or the proceeds of such enforcement or set-off or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, any other state or federal law, common law or any equitable cause, then, to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all Liens, rights and remedies therefor or related thereto, shall be revived and continued in full force and effect as if such payment or payments had not been made or such enforcement or set-off had not occurred.
     SECTION 11.16 Performance by the Agent. If the Borrower fails to perform any of its obligations under this Agreement or any other Loan Document or any Servicing Document in a timely fashion, the Agent shall be entitled, but not obliged, to perform such obligation at the expense of the Borrower and without waiving any rights that it may have with respect to such breach.
     SECTION 11.17 Third Party Beneficiaries. Each Protected Party, including without limitation each Support Party, is an express third party beneficiary hereof.
     SECTION 11.18 No Proceedings. (a) Each party hereto hereby agrees that it will not institute against any Conduit Lender, or join any other Person in instituting against any Conduit Lender, any bankruptcy, insolvency, receivership, liquidation or similar proceeding from the Closing Date until one year plus one day following the last day on which all commercial paper notes and other publicly or privately placed indebtedness for borrowed money of such Conduit Lender shall have been indefeasibly paid in full.
     (b) No recourse under any obligation, covenant or agreement of Conduit Lender as contained in any Loan Document shall be had against any incorporator, stockholder, affiliate, officer, employee or director of the Conduit Lender, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any statute or otherwise; it being expressly agreed and understood that the agreements of each Conduit Lender contained in any Loan Document are solely corporate obligations of such Conduit Lender and that no personal liability whatsoever shall attach to or be incurred by the incorporators, stockholders, affiliates, officers, employees or directors of such Conduit Lender, under or by reason of any of the respective obligations, covenants or agreements of such Conduit Lender contained in any Loan Document, or implied therefrom, and that any and all personal liability of every such incorporator, stockholder, affiliate, officer, employee or director of such Conduit Lender for breaches by such Conduit Lender of any such obligation, covenant or agreement, which liability may arise either at common law or in equity, by statute or constitution, or otherwise, is hereby expressly waived as
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a condition of and in consideration for the execution of this Agreement. The provisions of this Section 11.18 shall survive the termination of this Agreement.
     (c) Notwithstanding anything contained in this Agreement to the contrary, no Conduit Lender shall have any obligation to pay any amount required to be paid by it hereunder or thereunder to any party hereto, in excess of any amount available to such Conduit Lender after paying or making provision for the payment of its commercial paper notes. All payment obligations of each Conduit Lender hereunder are contingent upon the availability of funds in excess of the amounts necessary to pay commercial paper notes; and each of the parties hereto agree that they shall not have a claim under Section 101(5) of the United States Bankruptcy Code if and to the extent that any such payment obligation exceeds the amount available to such Conduit Lender to pay such amounts after paying or making provision for the payment of its commercial paper notes.
     SECTION 11.19 Governing Law; Submission to Jurisdiction. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 AND SECTION 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.  Any legal action or proceeding with respect to this Agreement or any other Loan Document may be brought in the courts of the State of New York in New York County, or of the United States for the Southern District of New York and, by execution and delivery of this Agreement, the Borrower hereby irrevocably accepts for itself and in respect of its property, generally and unconditional, the nonexclusive jurisdiction of such courts. The Borrower irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such proceeding brought in such court and any claim that any such proceeding brought in any such court has been brought in an inconvenient forum.
     SECTION 11.20 Waiver of Jury Trial. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
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     SECTION 11.21 Binding Effect. This Agreement shall become effective at such time when it shall have been executed by the Borrower, the Collateral Agent and the Agent, and the Agent shall have received copies hereof (telefaxed or otherwise) which, when taken together, bear the signatures of each Committed Lender, and thereafter this Agreement shall be binding upon and inure to the benefit of the Borrower, the Agent, the Collateral Agent and each Lender and their respective successors and assigns; provided ,  however , unless the conditions set forth in  Section 4.01  have been satisfied by the Borrower or waived by the Lenders on or before the Commitment Termination Date, none of the Borrower, the Agent, the Collateral Agent or the Lenders shall have any obligations under this Agreement.
     SECTION 11.22 The Patriot Act. The Agent and each Lender hereby notifies the Borrower that pursuant to the requirements of the Patriot Act and any comparable law applicable to any Lender, it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow the Agent and/or any Lender to identify the Borrower in accordance with the Patriot Act.
     SECTION 11.23 Railcar Subsidiaries. The Borrower may from time to time, with the consent of each of the Agent and the Collateral Agent, own one or more Railcar Subsidiaries. In such event, (i) the Borrower and the Agent shall execute such related amendments, modifications and supplements to this Agreement as may be required by the Agent and (ii) the Borrower and the Collateral Agent shall execute such related amendments, modifications and supplements to the Security Agreement (including any joinder agreements thereto) as may be required by the Collateral Agent.
     SECTION 11.24 Federal Income Tax Treatment. The Borrower, each Lender, the Agent, and each assignee and successor thereto hereby agrees to treat the Loans as indebtedness for federal income tax purposes, and shall maintain such position in all returns and proceedings relating to such federal income taxes, unless required otherwise pursuant to a final “determination” within the meaning of Section 1313 of the Code.
[Signature Pages Follow]
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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.
	
					
	 
	 
	 
	 
	 

	 
	TRINITY RAIL LEASING VI LLC, as Borrower

 By: Trinity Industries Leasing Company, its
         sole Member
  
	 

	 
	By:  
	/s/ Eric Marchetto  
	 

	 
	Eric Marchetto 
	 

	 
	 
	Title:  
	Executive Vice President 
	 

 

 
	
									
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	WILMINGTON TRUST COMPANY,
 as Collateral Agent and Depositary
  
	 

	 
	 

	 
	 
	Name:  
	J. Christopher Murphy 
	 

	 
	 
	Title:  
	Financial Services Officer 
	 

 

 
	
									
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	DVB BANK AG, as Agent and Committed Lender
  
	 

	 
	 

	 
	 
	Name:  
	Martin Metz  
	 

	 
	 
	Title:  
	M D 
	 

	 

	 
	 
	 

	 
	By:  
	/s/ Richard M. Waters  
	 

	 
	 
	Name:  
	Richard M. Waters 
	 

	 
	 
	Title:  
	SVP 
	 

 

 

	
								
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	BTMU CAPITAL CORPORATION, as a
 Committed Lender
  
	 

	 
	 

	 
	 
	Name:  
	Cheryl A. Behan 
	 

	 
	 
	Title:  
	Senior Vice President 
	 

 

 
	
									
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	CREDIT SUISSE, CAYMAN ISLANDS
 BRANCH, as a Committed Lender
  
	 

	 
	 

	 
	 
	Name:  
	Alex Smith 
	 

	 
	 
	Title:  
	Vice President 
	 

	 

	 
	 
	 

	 
	By:  
	/s/ Mark Lengel  
	 

	 
	 
	Name:  
	Mark Lengel 
	 

	 
	 
	Title:  
	Director 
	 

 

 
	
								
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	ALPINE SECURITIZATION CORP., as a Conduit Lender

 By: Credit Suisse, New York Branch, as
 Attorney-in-Fact
  
	 

	 
	 

	 
	 
	Name:  
	Alex Smith 
	 

	 
	 
	Title:  
	Vice President 
	 

	 

	 
	 
	 

	 
	By:  
	/s/ Mark Lengel  
	 

	 
	 
	Name:  
	Mark Lengel 
	 

	 
	 
	Title:  
	Director 
	 

 

 
	
									
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	ING BANK N.V., as a Committed Lender
  
	 

	 
	 

	 
	 
	Name:  
	Ben Dijkhuizen 
	 

	 
	 
	Title:  
	Director 
	 

	 

	 
	 
	 

	 
	By:  
	/s/ Vitomira Stambolova  
	 

	 
	 
	Name:  
	Vitomira Stambolova 
	 

	 
	 
	Title:  
	Director 
	 

 

 
	
									
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	KFW IPEX-BANK GMBH, as a Committed Lender
  
	 

	 
	 

	 
	 
	Name:  
	Martin Kloster 
	 

	 
	 
	Title:  
	First Vice President 
	 

	 

	 
	 
	 

	 
	By:  
	/s/ Christoph Gerke  
	 

	 
	 
	Name:  
	Christoph Gerke 
	 

	 
	 
	Title:  
	Vice President 
	 

 

 

	
								
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	LANDESBANK BADEN-WÜRTTEMBERG, as a Committed Lender
  
	 

	 
	 

	 
	 
	Name:  
	T. Leidenberger 
	 

	 
	 
	Title:  
	VP 
	 

	 

	 
	 
	 

	 
	By:  
	/s/ N. Bubik  
	 

	 
	 
	Name:  
	N. Bubik 
	 

	 
	 
	Title:  
	VP 
	 

 

 
	
									
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	LLOYDS TSB BANK PLC, as a Committed
 Lender
  
	 

	 
	 

	 
	 
	Name:  
	N. J. Blake 
	 

	 
	 
	Title:  
	Associate Director 
	 

 

 
	
								
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	NORDDEUTSCHE LANDESBANK
 LUXEMBOURG S.A., as a Committed Lender
  
	 

	 
	 

	 
	 
	Name:  
	Brigitte Wels 
	 

	 
	 
	Title:  
	Senior Vice President 
	 

	 

	 
	 
	 

	 
	By:  
	/s/ Hartmut Ziern  
	 

	 
	 
	Name:  
	Hartmut Ziern

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