Document:

EX-10.10.A

 

Exhibit 10.10.A

BOND GUARANTY AGREEMENT

     THIS
BOND GUARANTY AGREEMENT is made and entered into as of June 1,
1995 (the “Guaranty”), by
and among AMERICAN RAILCAR INDUSTRIES, INC., a Missouri corporation (“Company”), ACF INDUSTRIES,
INC., a New Jersey corporation (the “Corporate Guarantor”) and FLEET NATIONAL BANK, as trustee
(“Trustee”), a national banking association duly organized, validly existing, and in good standing
under the laws of the United States, with all requisite power and authority to act as trustee in
the State of Missouri, together with any successor trustee at the time serving as such under the
Trust Indenture (hereinafter identified) between The Industrial Development Authority of the City
of Kennett, Missouri (“Issuer’), and Trustee.

WITNESSETH:

     WHEREAS, Issuer is a duly organized and existing industrial development corporation
under the laws of the State of Missouri and proposes to issue its industrial development revenue
bonds under the provisions of the Industrial Development Corporation Act, Chapter 349 of the
Revised Statutes of Missouri, 1986, as amended (the “Act”), in the principal amount of $5,500,000,
designated Industrial Development Revenue Bonds (American Railcar Industries, Inc./ACF Industries,
Incorporated Railcar Component Manufacturing Project), Series 1995 (the “Bonds”); and

     WHEREAS,
the Bonds will be issued under and secured by a Trust Indenture, dated as of June
1, 1995 (the “Indenture”), by and between Issuer and Trustee; and

     WHEREAS, the proceeds to be derived from the sale of the Bonds will be loaned by Issuer to
Company pursuant to a Loan Agreement dated as of June 1, 1995 (the “Loan Agreement”) to finance the
costs of acquiring, constructing, and equipping an industrial facility for use in the manufacture,
production, processing, distribution, and sale of railcar components or related industrial
products with attached office; and

     WHEREAS, Company desires that Issuer issue the Bonds and apply the proceeds as aforesaid, and
Company is willing to enter into this Guaranty in order to enhance the marketability of the Bonds
and thereby achieve interest cost and other savings to Company; and

     WHEREAS, Corporate Guarantor is the majority shareholder of the Company and will derive
substantial benefits from the facilities being financed pursuant to the Loan Agreement;

     NOW, THEREFORE, in consideration of the premises and in order to achieve the interest cost
and other savings described above, and as an inducement to the initial purchasers of the Bonds and
all who shall at any time become owners of the Bonds, Company and Corporate Guarantor do hereby,
subject to the terms hereof, jointly and severally covenant and agree with Trustee as follows:

ARTICLE I

REPRESENTATIONS AND WARRANTIES

     Section 1.1. Company does hereby represent and warrant that:

     (a) Company is a corporation duly incorporated and in good standing under the laws of the
State of Missouri, has power to enter into this Guaranty, and has duly authorized the execution
and delivery of this Guaranty by proper corporate action;

 

 

     (b) neither this Guaranty, the execution and delivery hereof, nor the agreements herein
contained are prevented, limited by, or contravene or constitute a material default under any
agreement, instrument, or indenture to which Company is a party or by which it is bound or any provisions
of Company’s Articles of Incorporation or any requirements of law; and

     (c) the assumption by Company of its obligations hereunder will result in a direct financial
benefit to Company.

     Section 1.2. Corporate Guarantor does hereby represent and warrant that:

     (a) Corporate Guarantor is a corporation duly incorporated and in good standing under the
laws of the State of New Jersey, has power to enter into this Guaranty, and has duly
authorized the execution and delivery of this Guaranty by proper corporate action;

     (b) neither this Guaranty, the execution and delivery hereof, nor the agreements herein
contained are prevented, limited by, or contravene or constitute a material default under any
agreement, instrument, or indenture to which Corporate Guarantor is a party or by which it is bound or
any provisions of Corporate Guarantor’s Articles of Incorporation or any requirements of law; and

     (c) the assumption by Corporate Guarantor of its obligations hereunder will result in a direct
financial benefit to Corporate Guarantor.

ARTICLE II

GUARANTY

     Section 2.1. Company and Corporate Guarantor hereby jointly and severally guarantee to
Trustee for the benefit of the Owners from time to time of the Bonds (a) the full and prompt
payment of the principal of and premium, if any, on any Bond when and as the same shall become
due, whether at the stated maturity thereof, by acceleration, call for redemption, or otherwise,
and (b) the full and prompt payment of any interest on any Bond when and as the same shall become
due. The liability of Company and Corporate Guarantor hereunder and the rights of the Trustee for
the benefits of the Owners hereunder shall be reinstated and revived with respect to any amount at
any time paid with respect to the obligations of Company or Corporate Guarantor that thereafter is
required to be returned or restored by Trustee or any Owner as a result of insolvency, bankruptcy,
reorganization or other similar proceedings affecting Borrower or Corporate Guarantor or any of
the assets of either of them, all as though such amount had not been
paid. All payments by Company
or Corporate Guarantor shall be paid in lawful money of the United States of America. Each and
every default in payment of the principal of or premium, if any, or interest on any Bond shall
give rise to a separate cause of action hereunder, and separate suits may be brought hereunder as
each cause of action arises.

     Section 2.2. The obligations of Company and Corporate Guarantor under this Guaranty arise
upon the issue, sale and delivery of the Bonds by Issuer and the deposit of the net proceeds of
such sale with the Trustee so as to make the loan to the Company pursuant to the Loan Agreement.
The obligations of the Company and the Guarantor shall be joint, several, absolute and
unconditional, and shall remain in full force and effect until the entire principal of and
premium, if any, and interest on the Bonds shall have been paid or provided for under the
Indenture and such obligations shall not be affected, modified, or impaired upon the happening
from time to time of any event, including, without limitation, any of the following, whether or
not with notice to, or the consent of, Company or Corporate Guarantor:

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     (a) the compromise, settlement, release, or termination of any or all of the
obligations, covenants, or agreements of the Company under this Guaranty, the Indenture or the
Loan Agreement;

     (b) the failure to give notice to Company or Corporate Guarantor of the occurrence
of an event of default under the terms and provisions of this Guaranty, the Loan Agreement,
the Deed of Trust, or the Indenture;

     (c) the assignment or mortgaging or the purported assignment or mortgaging of all
or any part of the interest of Company in the Mortgaged Property or any failure of title with
respect to Company’s interest in the Mortgaged Property;

     (d) the waiver by Trustee or Issuer of the payment, performance, or observance by
Company or Trustee of any of the obligations, covenants, or agreements contained in the
Indenture, the Loan Agreement, the Deed of Trust, or this Guaranty, other than the failure of
the Trustee to make a required payment under the Indenture;

     (e) the extension of the time for payment of any principal of or premium, if any, or
interest on any Bonds under this Guaranty or of the time for performance of any other
obligations, covenants, or agreements under or arising out of the Indenture, the Loan
Agreement, the Deed of Trust, or this Guaranty or the extension or the renewal of any thereof (other than
the extension of the time for payment by the Trustee of a required payment under the Indenture, if
the Company and/or Corporate Guarantor has made the payment due under the Note, the Loan
Agreement, or the Deed of Trust from which such payment by the Trustee shall derive or
provision thereof shall have been made (as in the case of sums deposited into the Bond Fund),
whether in cash or cash equivalents or by tendering Bonds (as, when and to the extent
permitted under the Indenture));

     (f) the modification or amendment (whether material or otherwise) of any obligation,
covenant, or agreement set forth in the Indenture, the Deed of Trust, or the Loan Agreement;

     (g) the taking or the omission of any of the actions referred to in the Indenture, the
Loan Agreement, the Deed of Trust, and of any actions under this Guaranty;

     (h) any failure, omission, delay, or lack on the part of Issuer or Trustee to enforce,
assert, or exercise any right, power, or remedy conferred on Trustee in this Guaranty, the Loan
Agreement, the Deed of Trust, or the Indenture, or any other act or acts on the part of Trustee
(other than the failure of the Trustee to make a required payment under the Indenture, if the
Company and/or the Corporate Guarantor has made the payment due under the Note, the Loan Agreement,
or the Deed of Trust from which such payment by the Trustee shall derive or provision therefor
shall have been made (as in the case of sums deposited into the Bond Fund), whether made in cash
or cash equivalents or by tendering Bonds (as, when and to the extent permitted under the
Indenture)) or any of the owners from time to time of the Bonds;

     (i) the voluntary or involuntary liquidation, dissolution, sale, or other disposition of all
or substantially all the assets, marshalling of assets and liabilities, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition with
creditors, or readjustment of, or other similar proceedings affecting Company or Corporate
Guarantor or any of the assets of any of them, or any allegation or contest of the validity of
this Guaranty in any such proceeding; or

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     (j) to the extent permitted by law, the release or discharge of Company or
Corporate Guarantor from the performance or observance of any obligation, covenant, or
agreement contained in this Guaranty by operation of law.

     Section 2.3. Other than the payment of any obligation (including payments under the
Indenture), no set-off, counterclaim, reduction, or diminution of such obligation, if any, which
Company or Corporate Guarantor has or may have against Issuer or Trustee shall be available
hereunder to the Company or the Guarantor against Trustee.

     Section 2.4.
In the event of a default under the Indenture or the Loan Agreement in the
payment of principal of or premium, if any, on any Bond when and as the same shall become due,
whether at the stated maturity thereof, by acceleration, call for redemption, or otherwise, or in
the event of a default in the payment of any interest on any Bond when and as the same shall
become due, Trustee may, and if requested so to do by the Owners of not less than a majority in
aggregate principal amount of the Bonds then outstanding and upon indemnification as hereinafter
provided, shall be obligated to proceed hereunder, and Trustee, in its sole discretion, shall have
the right to proceed first and directly against Company or Corporate Guarantor under this Guaranty
without proceeding against any other person or exhausting any other remedies which it may have and
without resorting to any other security held by Issuer or Trustee.

     Before taking any action hereunder, Trustee may require that satisfactory indemnity be
furnished by the Owners requesting such action for the reimbursement of all expenses and to
protect against all liability, determined in a reasonable manner, except liability which is
adjudicated to have resulted from its gross negligence or willful default by reason of any action
so taken.

     Section 2.5. Company or Corporate Guarantor hereby expressly waive notice from Trustee
or the owners from time to time of any of the Bonds, if any, of their acceptance and reliance on
this Guaranty. Company or Corporate Guarantor agrees to pay all reasonable costs, expenses, and
fees, including all reasonable attorneys’ fees, which may be incurred by Trustee in enforcing or
attempting to enforce this Guaranty following any default on the part of Company or Corporate
Guarantor, whether the same shall be enforced by suit or otherwise.

     Section 2.6. This Guaranty is entered into by the parties hereto for the benefit of
Trustee, the Owners from time to time of the Bonds, and any successor trustee or trustees under
the Indenture, all of whom shall be entitled to enforce performance and observance of this
Guaranty.

ARTICLE III

COVENANTS

     Section 3.1. Corporate Guarantor shall not enter into any transaction of merger or
consolidation or change the form of organization of its business unless the Corporate Guarantor is
the surviving entity or the surviving entity expressly assumes the obligations of the Corporate
Guarantor under this Guaranty.

     Section 3.2. Corporate Guarantor will deliver to Trustee and the Original Purchaser:

     (a) Promptly upon their becoming available, and in any event not later than
120 days after the end of each fiscal year, the audited financial statements of Corporate
Guarantor,

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accompanied by an unqualified opinion from KPMG Peat Marwick or another independent accounting
firm reasonably satisfactory to Trustee.

     (b) Not later than 90 days after the end of each of the first 3 quarterly periods in each
fiscal year, unaudited financial statements of Corporate Guarantor for such quarter.

     (c) As soon as practicable but in any event within ten (10) days upon becoming aware of the
existence of any condition or event that constitutes an event of default under this Guaranty or the
Loan Agreement, a written notice specifying the nature and period of existence thereof and what
action Company and Corporate Guarantor are taking or propose to take with respect thereto.

     (d)
Immediately upon becoming aware that the Owner of any Bond has given notice or taken any
other action with respect to a claimed event of default, a written notice specifying the notice
given or action taken by such Bondowner and the nature of the claimed event of default and what
action Company and Corporate Guarantor are taking or propose to take with respect thereto.

     Company and Corporate Guarantor will permit any of Trustee’s representatives, at Trustee’s expense,
to visit and inspect the Mortgaged Property, to examine an of the Company’s and Corporate
Guarantor’s books of account, records, reports, and other papers relating to the Mortgaged
Property, and to make copies and extracts therefrom, and to discuss their respective affairs,
finances, and accounts relating to the Mortgaged Property with their respective officers,
employees, and independent public accountants (and by this provision Company authorizes its
accountants to discuss the same) all at such reasonable times and as often as may be reasonably
requested; provided, however, that Trustee shall hold such information in confidence and shall not
use such information for any purpose other than to determine whether the covenants, terms, and
provisions of this Guaranty have been complied with by Company and Corporate Guarantor and to
protect their interests under this Guaranty or where disclosure may be required by law. Nothing
herein shall be deemed to constitute a waiver of any accountant-client privilege during the
pendency of litigation between Trustee, Company and Corporate Guarantor.

ARTICLE IV

EVENTS OF DEFAULT

     Section 4.1.
An “event of default” shall exist if any of the following occurs and is continuing:

     (a)
Section 2.1 Defaults. Either Company or Corporate Guarantor fails to perform or observe
any covenant contained in Section 2.1 of this Guaranty and such failure continues for two (2) days
after written notice of the Company’s failure to make any Loan Payment is given to the person
identified in Section 5.2 as the representative of the Company and the Corporate Guarantor,
together with a request to remedy the same.

     (b)
Other Defaults. Either Company or Corporate Guarantor fails to comply with any other
provision of this Guaranty, and such failure continues for more than 30 days after written
notice of such failure shall be given to the person identified in Section 5.2 as the
representative of Company and Corporate Guarantor together with a
request to remedy the
same, or if such failure to comply cannot be cured within such 30-day period, then if either Company or Corporate Guarantor fails to commence to cure such
failure to comply within such 30-day

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period and thereafter fails to prosecute to completion with diligence and continuity the
performance required to cure such failure to comply.

     (c) Bankruptcy.

     (i) Company, Corporate Guarantor (or any other Person obligated, as guarantor or otherwise, to make
payments on the Bonds or under the Loan Agreement or this Guaranty) shall (A) apply for or consent
to the appointment of, or the taking of possession by, a receiver, custodian, trustee, liquidator,
or the like of Company, Corporate Guarantor (or such other Person) or of all or any substantial
part of its property, (B) commence a voluntary case under the United States Bankruptcy Code (as now
or hereafter in effect), or (C) file a petition seeking to take advantage of any other law relating
to bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment of debts; or

     (ii) A proceeding or case shall be commenced, which case or proceeding shall not be dismissed
within 90 days, without the application or consent of Company, Corporate Guarantor (or any other
Person obligated, as guarantor or otherwise, to make payments on the Bonds or under the Loan
Agreement), in any court of competent jurisdiction, seeking (A) the liquidation, reorganization,
dissolution, winding-up, or composition of adjustment of debts, of Company, Corporate Guarantor,
(B) the appointment of a trustee, receiver, custodian, liquidator, or the like of Company,
Corporate Guarantor (or any such other Person) or of all or any substantial part of its respective
property, or (C) similar relief in respect of Company or Corporate Guarantor (or any such other
Person) under any law relating to bankruptcy, insolvency, reorganization, winding-up, or
composition or adjustment of debts.

     (d)
Warranties. Any material warranty or representation made by or on behalf of Company or
Corporate Guarantor in the Loan Agreement, the Deed of Trust, this Guaranty, or any writing
furnished in connection with or pursuant thereto, as applicable, shall be false or misleading in
any material respect as of the date made.

ARTICLE V

NOTICE AND SERVICE OF PROCESS,

PLEADINGS AND OTHER PAPERS

     Section 5.1. Company covenants that it is qualified to do business and subject to service of
process in the State of Missouri and that it will remain so qualified so long as any of the Bonds
are outstanding and Company and Corporate Guarantor each covenant that each is qualified to do
business in each jurisdiction where failure to so qualify would have a material adverse affect on
its business or property.

     Section 5.2. Any notice, process, pleadings, or other papers served upon the agents or officers of
Company or Corporate Guarantor shall be sent by registered or certified mail as follows:

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If to Company:

American Railcar Industries, Inc.

c/o ACF Industries, Incorporated

3301 Rider Trail South

Earth City, MO 63045

Attention: Umesh Choksi, Assistant Treasurer

If to Corporate Guarantor:

ACF Industries, Incorporated

3301 Rider Trail South

Earth City, MO 63045

Attention: Umesh Choksi, Treasurer

If to the Trustee:

Fleet National Bank

111 Westminster Street

Providence, Rhode Island 02903

Attention: Corporate Trust Department

or to such other address as may be furnished by any party hereto or by Trustee in writing.

ARTICLE VI

MISCELLANEOUS

     Section 6.1. The obligations of Company and Corporate Guarantor hereunder shall arise jointly,
severally and absolutely when the Bonds shall have been issued, sold, and delivered by Issuer and
the proceeds thereof paid to Trustee for the account of Issuer under the Indenture.

     Section 6.2. No remedy herein conferred upon or reserved to Trustee is intended to be exclusive of
any other available remedy or remedies, but each and every such remedy shall be cumulative and
shall be in addition to every other remedy given under this Guaranty or now or hereafter existing
at law or in equity. No delay or omission to exercise any right or power accruing upon any default,
omission, or failure of performance hereunder shall impair any such right or power or shall be
construed to be a waiver thereof, but any such right and power may be exercised from time to time
as often as may be deemed expedient. In order to entitle Trustee to exercise any remedy reserved to
it in this Guaranty, it shall not be necessary to give any notice, other than such notice as may be
herein expressly required. In the event any provision contained in this Guaranty should be breached
by Company or Corporate Guarantor and thereafter duly waived by Trustee, such waiver shall be
limited to the particular breach so waived and shall not be deemed to waive any other breach
hereunder. No waiver, amendment, release, or modification of this Guaranty shall be established by
conduct, custom, or course of dealing, but solely by an instrument in writing duly executed by
Trustee.

     Section 6.3. Trustee shall not consent to any amendment or modification of this Guaranty except in
accordance with the provisions of Article XIII of the Indenture. Nothing contained herein or in the
Indenture shall permit, or be construed as permitting, any amendment, change, or modification of
this Guaranty which would change the amount of any sums payable by Company or Corporate Guarantor

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hereunder or the time for payment of such amounts or change the unconditional nature of the
Guaranty herein contained.

     Section 6.4. This Guaranty constitutes the entire agreement, and supersedes all prior agreements
and understandings, both written and oral, among the parties with respect to the subject matter
hereof and may be executed in several counterparts, each of which shall be deemed an original, and
all of which together shall constitute one and the same instrument.

     Section 6.5. The invalidity or unenforceability
of any one or more phrases, sentences, clauses, or Sections in this Guaranty shall not affect the validity or
enforceability of the remaining
portions of this Guaranty or any part hereof.

     Section 6.6. All words and phrases defined in the Indenture and not otherwise defined herein shall
have the same meanings for purposes of this Guaranty.

     Section 6.7. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF MISSOURI.

     IN WITNESS WHEREOF, Company and Corporate Guarantor have caused this Guaranty to be executed
in their respective names and behalfs and attested by the duly authorized officers, all as of the
date first above written.

	 	 	 	 	 	 	 
	 	 	AMERICAN RAILCAR INDUSTRIES, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	William L. Finn	 	 
	 

	 	 	 	 

     Its: Executive Vice President
	 	 

Attest:

	 	 	 	 	 
	By:

	 	Umesh Choksi	 	 
	Its:

	 	 

Assistant Treasurer
	 	 

	 	 	 	 	 	 	 
	 	 	ACF INDUSTRIES, INCORPORATED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Umesh Choksi	 	 
	 

	 	 	 	 

     Its: Treasurer
	 	 

Attest:

	 	 	 	 	 
	By:
	 	[ILLEGIBLE]	 	 
	Its:

	 	 

Vice President
	 	 

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Approved and Accepted this 22nd day of June, 1995:

	 	 	 	 	 
	FLEET NATIONAL
BANK, as Trustee	 	 
	 
	 	 	 	 
	By:
	 	[ILLEGIBLE]	 	 
	Its:

	 	 

Vice President
	 	 

-9-EX-10.18

 

Exhibit 10.18

Confidential Treatment has been requested for portions

of this document marked with asterisks. 

MULTI-YEAR PURCHASE AND SALE AGREEMENT

     This Multi Year Purchase and Sale Agreement (this “Agreement”) is made as of this
29th day of July, 2005, by and between The CIT Group/Equipment Financing, Inc.
(“Buyer”), a corporation organized under the laws of the State of Delaware, and American Railcar
Industries, Inc. (“Seller”), a corporation organized under the laws of the State of Missouri.
Seller is a manufacturer of railroad rolling stock that Buyer desires to purchase and Seller
desires to sell.

     For and in consideration of the premises and the mutual covenants contained herein, and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
Buyer and Seller hereby agree as follows:

	 	1.	 	Sale of Railcars; Scope of Work.

          (a) Subject to the provisions hereof, Seller agrees to manufacture and sell to Buyer railcars
of the types described in Exhibit A attached hereto (individually, a “Car,” and collectively, the
“Cars”), and Buyer agrees to purchase Cars from any such types. Except as otherwise provided in
this Agreement, Seller shall furnish all labor, materials and equipment required to manufacture the
Cars at its manufacturing facility or facilities listed on Exhibit A hereto (hereinafter referred
to as “Seller’s Plant”).

          (b) In each of calendar 2006, 2007 and 2008 (each, an “Agreement Year”), Seller hereby offers
to sell to Buyer up to four thousand (4,000) Cars (the “Offered Quantity”) consisting of any
combination and number of types identified on Exhibit A hereto (“Offered Car Types”). Buyer agrees
to order from Seller in each Agreement Year pursuant to the terms of one or more schedules (each, a
“Schedule”) and one or more purchase orders (each, a “Purchase Order”) of not less than three
thousand (3,000) Cars (“Railcar Quantity Obligations”) from among the Offered Car Types for
delivery in each Agreement Year. The obligation of Seller to offer and the obligation of Buyer to
purchase Cars in any Agreement Year are subject to the provisions of this Agreement. Buyer shall
not be obligated to order any percentage or number of Cars from any particular Offered Car Types
provided that Buyer orders Cars which conform to one or more Offered Car Types. The parties shall
execute a separate Schedule with respect to specific Car purchases under this Agreement. Each
Schedule shall incorporate the provisions of this Agreement and the numbers and particulars of the
Cars to be ordered, delivery dates, any special terms and pricing. If pricing is not agreed or
cannot then be determined, the pricing terms may be deferred to resolution under the provisions of
this Agreement.

          (c) The purchase and sale obligations set forth in paragraph (b) of this Section 1 in any
Agreement Year shall depend on * * *. If * **,Buyer shall have the right, on * * * prior notice, to
cancel any pending Purchase Orders or reduce subsequent Railcar Quantity Obligations in the then
current Agreement Year, in either case such that actual purchases by Buyer would not fall below * *
* of that Agreement Year’s original Railcar Quantity Obligations. If * * *, Buyer shall have the
right to cancel or suspend all, or any, pending Purchase Orders or remaining Railcar Quantity
Obligations under this Agreement upon * * *

 

 

Confidential Treatment has been requested for portions

of this document marked with asterisks. 

written notice to Seller (or lesser notice as agreed to by both Parties in any case). If,
during the term of this Agreement, * * *, Buyer may elect, on * * * prior notice, to activate
suspended Purchase Orders or to place new Purchase Orders up to the Offered Quantity in each
Agreement Year or pro rata for any remaining partial Agreement Year. Buyer’s right to reactivate
and Seller’s obligation to honor such reactivation shall depend on Seller’s available
production capacity as at the date of Seller’s receipt of Buyer’s notice of reactivation. * * * In
the event Buyer elects to cancel any pending Purchase Order under this paragraph within * * * of
the delivery date thereunder, Seller may require, by written notice to Buyer, that Buyer purchase
from Seller, at * * *, all material which Seller had theretofore purchased and identified to such
cancelled Purchase Orders. In the event Buyer purchases such material following a cancellation,
Buyer may elect to store such material at Seller’s facility for up to * * * at * * *. Buyer may at
any time have such material removed from Seller’s facility or resell such material to Seller at
cost for use in manufacture of Cars subsequently ordered by Buyer pursuant to a Purchase Order
under this Agreement.

	 	2.	 	Purchase Price.

          (a) The actual purchase price (“Purchase Price”) shall be * * *. The base purchase price of
the Cars (the “Base Purchase Price”) as of July 2005 for each Offered Car Type shall be as set
forth in Exhibit A hereto. The Base Purchase Price is firm and subject to escalation or other
adjustment after the date of this Agreement only as provided in this Agreement. The Base Purchase
Price shall be * * *. The Base Purchase Price, as increased or decreased pursuant to the
provisions of this Agreement, is referred to as the “Adjusted Purchase Price.” Neither the
Adjusted Purchase Price nor any Market Price includes any state or local sales, use or other
similar taxes, and any such sales, use or similar tax arising out of this transaction, if any,
shall be paid by Buyer together with the Base Purchase Price. Seller shall sell Cars to Buyer at
the lesser of the Adjusted Purchase Price or the best current market price (“Market Price”)
determined on a “most favored nations” basis.

          (b) At the time of execution of each Schedule and Purchase Order, Seller shall provide Buyer
the Market Price for the delivery period quoted. “Most favored nations” pricing, for the purpose
of this Agreement, is defined as the lowest price of an Offered Car Type offered by Seller to the
marketplace in general.

          (c) Seller shall also inform Buyer in connection with the execution of each Schedule, of
Seller’s estimated adjustments to the relevant Base Purchase Price. Seller shall inform Buyer
promptly of its final determination of the Adjusted Purchase Price and, in any event, prior to
rendering any Seller’s invoice with respect to such Schedule. * * *. No adjustments shall be made
in any Price for changes in any of the following * * *.

          (d) * * *

     3. Specifications* * * . The. Cars shall be constructed in a good and
workmanlike manner in accordance with the specifications described on Exhibit C hereto, as the same
may be hereafter amended or supplemented from time to time (the “Specifications”). The
Cars will be built in accordance with all then current Federal Railroad Administration, American
Association of Railroads and United States Department of Transportation design, testing and
approval

 

 

Confidential Treatment has been requested for portions

of this document marked with asterisks. 

requirements for new Cars.

     Seller shall construct and equip each Car with components and appurtenances identified on * *
* attached hereto as Exhibit D. * * *

     4. Buyer’s
Option to Modify Order. Within ten (10) days of the placement of
each Purchase Order, Seller shall give Buyer written notice of the date on which Seller will
commence manufacture of each type of Car (“Manufacture Start Date”). Buyer will have the option to
change either the quantity or type of Car to be purchased subject to the following conditions:

          (a) The option must be exercised no later than * * *prior to any Manufacture Start Date by
Buyer notifying Seller in writing of the change.

          (b) * * *

          (iii) Seller may reasonably modify the delivery schedule in the event that Seller requires
additional time to manufacture the Cars with respect to which the order has been changed.

          (c) * * *

               (iv) Seller may reasonably modify the delivery schedule in the event that it requires
additional time to manufacture the Cars with respect to which the order has been changed.

5. Delivery and Terms of Payment

          (a) Seller shall (i) dedicate, for Buyer’s benefit, sufficient production capacity toward the
production and delivery of * * *

          (b) If, with respect to Offered Car Types covered under this Agreement, Seller is unable to
meet engineering specifications required by Buyer, the quantity of Cars that Seller is unable to
provide will be deducted from the Railcar Quantity Obligations. From time to time in any Agreement
Year of the term of this Agreement, Seller * * *

          (c) Unless otherwise agreed in writing, delivery of the Cars shall be F.O.B. Seller’s Plant
not later than * * * following the date of the Purchase Order therefor. After a Certificate of
Acceptance (as hereinafter defined) has been executed with respect to a Car, such Car will be
shipped from Seller’s Plant to the railroad interchange designated in Exhibit A hereto (the
“Interchange Point”), and Seller shall invoice Buyer for payment of the Purchase Price. Unless
otherwise agreed, Seller shall, at its expense, deliver the Cars to the Interchange Point and all
subsequent switching and transportation charges shall be for Buyer’s account. Payment by Buyer of
Seller’s invoice shall be due * * * after Buyer’s receipt thereof Title to a Car shall pass to
Buyer upon payment in full for such Car. Following receipt of payment for a Car, Seller shall
deliver to Buyer a bill for sale for such Car substantially in the form of Exhibit E hereto.

     6. Force Majeure. In the event that Seller is unable to deliver a Car to Buyer within
* * * after the date of a Purchase Order therefor as a result of a Force Majeure Event, Buyer shall

 

 

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have the option to notify Seller that it will not purchase such Car(s) as to which delivery
has been delayed, and the Railcar Quantity Obligations in that Agreement Year shall be reduced by
the number of Cars that Seller is unable to deliver, the Purchase Price will be reduced accordingly
for each Car that Buyer has elected not to purchase, and such omitted Car will not be deemed a
“Car” under this Agreement. As used herein, a “Force Majeure Event” shall mean and include any
delays in the delivery of any Car caused by strikes, lockouts (other than lockouts by Seller) or
other labor disturbances; shortages or late delivery of material (due to no fault of Seller);
unavailability, interruptions or inadequacy of fuel supplies; acts of God; war, preparation for war
or other acts or interventions the military or other governmental agencies; governmental
regulations; priorities given to defense orders; riot, embargoes, sabotage, act of terrorism,
vandalism, malicious mischief, landslides, floods, hurricanes, earthquakes, collisions or fires;
delays of subcontractors or of carriers by land, sea or air (due to no fault of Seller); quarantine
restrictions, shortages of labor or components and any other circumstances or cause
beyond Seller’s reasonable control.

     7. Inspection and Acceptance; Failure to Deliver. Seller shall give Buyer, and/or its
designated agent, reasonable opportunity to inspect the Cars during construction at Seller’s Plant
during normal operating hours or at such other time as may be mutually agreed. Prior to shipment
of a Car, Buyer and Seller shall mutually agree on a date for Buyer’s inspection of such completed
Car and the execution of a certificate of acceptance (“Certificate of Acceptance”) in the form of
Exhibit F hereto. If Buyer determines that a Car appears to have been manufactured according to
the applicable specifications and is in acceptable condition for delivery (hereinafter, a
“Conforming Car”), Buyer shall execute a Certificate of Acceptance. In the event Buyer does not
attend such inspection, or Buyer and Seller cannot mutually agree on an inspection date to occur
within three (3) days of the date of shipment of the Car, Seller is authorized and empowered to
inspect the Car and execute a Certificate of Acceptance on Buyer’s behalf if it determines that the
Car is a Conforming Car. If Buyer notifies Seller that a Car does not conform to the
specifications applicable to that Car (hereinafter a “Non-Conforming Car”), it shall be Seller’s
obligation to make the Car a Conforming Car. The execution of a Certificate of Acceptance shall
not preclude Buyer from asserting a claim for a breach of Seller’s Car warranty contained in
Section 9 herein within the applicable warranty period or that a Car was not manufactured in
accordance with the applicable Specifications.

     If Seller is unable to provide a Conforming Car within * * * of the scheduled delivery date
for any reason whatsoever other than a Force Majeure Event or as a result of a delay caused by
Buyer,* * *.

     8. No Liens or Claims of Third Parties. Seller hereby represents and warrants to
Buyer that: (a) Seller is the sole owner of the Cars and has good and marketable title to all of
the Cars, free and clear of all liens, claims, demands, charges, security interests, privileges,
pledges or other encumbrances (“Liens”) other then the Liens created by Buyer and that Seller will
convey to Buyer good and marketable title to the Cars being sold free and clear of all Liens of
every nature and kind whatsoever other than Liens created by Buyer; and (b) neither Seller’s rights
in the Cars, nor the Cars, are subject to any contract, agreement, or understanding, whether
written or oral, which provides for any remarketing, residual sharing or similar arrangement or
which would be binding upon or enforceable against Buyer, the Cars, or the proceeds of any sale,

 

 

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lease or any disposition of any thereof.

     9. Seller’s Car Warranty; Car Cleaning. Seller warrants that each Car will be free
from defects in material and workmanship under normal use and service for a period of * * * from
the Closing Date and will be manufactured in accordance with the applicable Specifications. With
respect to parts and materials manufactured by others and incorporated by Seller in the Cars, such
parts and material shall be covered only by the warranty, if any, of the manufacturer thereof, and
Seller shall assign to Buyer any such warranty, to the extent assignable by Seller * * * . Seller’s
obligations with respect to any Car for breach of this warranty is limited at its option, to either
a credit or refund of the price of any non-conforming or defective component (or Car) or
replacement or repair of such non-conforming or defective component (or Car) at Seller’s Plant or
at such other location as Seller shall designate in order to minimize Purchaser’s transportation
expenses. Seller’s agreement set forth above to refund, repair or replace defective parts and
materials (other than with respect to parts and materials manufactured by others and incorporated
by Seller in the Cars, the remedy for which is provided for above in this Section 9) shall be
Buyer’s sole and exclusive warranty liability with respect to the Cars that are defective in any
respect or that fail to conform to any express or implied warranty, and Seller will not in any
event be liable for the cost of any labor or transportation charges expended on or in connection
with the repair, replacement or return of any component (or Car) or, except as provided herein, for
any special, indirect, incidental, or consequential damages.

     THIS WARRANTY IS EXPRESSLY IN LIEU OF ALL OTHER WARRANTIES EXPRESS OR IMPLIED, INCLUDING ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. BUYER ACKNOWLEDGES THAT ITS SOLE
REMEDY FOR BREACH OF THIS WARRANTY BY SELLER IS AS PROVIDED ABOVE AND, EXCEPT AS PROVIDED HEREIN,
SELLER SHALL NOT BE LIABLE FOR ANY SPECIAL, INDIRECT OR OTHER INCIDENTAL OR CONSEQUENTIAL INJURY OR
DAMAGE; PROVIDED, HOWEVER, NOTHING CONTAINED HEREIN SHALL LIMIT SELLER’S LIABILITY TO BUYER FOR
CLAIMS OF CONTRIBUTION, IN TORT, PRODUCTS LIABILITY, OR ARE BASED ON ACTS OR OMISSIONS OF SELLER
WITHOUT ANY NEGLIGENCE ON THE PART OF BUYER.

     THIS WARRANTY IS CONDITIONED UPON COMPLIANCE BY BUYER AND ALL OTHER USERS OF THE CARS WITH
OPERATION, LOADING, USE, HANDLING, MAINTENANCE AND STORAGE IN ACCORDANCE WITH GOOD COMMERCIAL
PRACTICES OF THE RAILROAD INDUSTRY. SELLER SHALL NOT BE RESPONSIBLE FOR FAILURES CAUSED BY
MISLOADING, OVERLOADING, OVERHEATING, IMPROPER CLEANING, PHYSICAL ABUSE, ACCIDENT, DERAILMENT OR
FOR OTHER DAMAGE CAUSED BY FIRE, FLOOD OR OTHER EXTERNAL CONDITIONS UNRELATED TO THE MANUFACTURE OF
THE CAR, OR FOR NORMAL WEAR AND TEAR.

     In general, Cars shall be delivered clean and free from debris or other matter. Certain of
the Cars may require that particular cleaning procedures be followed. Any such procedures and the
Cars to which such procedures apply shall be described in Exhibit G hereto. Notwithstanding the
fact that a Certificate of Acceptance has been executed with respect to a Car, if a Car is not
clean prior to first load by Buyer’s customer so as to make it suitable for loading the

 

 

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     commodities described on Exhibit G hereto, then Buyer and Seller may jointly inspect the Car
or Cars in question. Seller will either pay, or reimburse Buyer, for the expenses to clean any
such Car, up to a maximum of * * * per car, provided, however, Seller’s payment or reimbursement
obligation will not apply if the Car is not clean because foreign matter was introduced while in
transit or through loading operations or other actions of third parties.

     10. Sales Tax. Buyer shall pay, and shall indemnify and hold Seller harmless on an
after-tax basis against, all sales, use, transfer or similar taxes (and any fines, penalties,
additions to tax or interest relating thereto), if any, imposed or assessed on or with respect to
the sale and the transfer of the Cars as contemplated herein.

     11. No Finder. Each party represents and warrants to the other that neither it nor
any party acting on its behalf has paid, or become obligated to pay, or committed any other party
to pay any fee or commission to any broker, finder or intermediary for or on account of the
transactions contemplated by this Agreement.

     12. Patents. In lieu of any other warranty by Seller against patent infringement,
statutory or otherwise, Seller agrees to defend, hold harmless and indemnify Buyer against all
claims, demands, losses, suits, damages, liabilities and expenses (including reasonable attorneys’
fees) arising out of any suit, claim, or action for actual or alleged direct or contributory
infringement of, or inducement to infringe, any patent, trademark, copyright or other intellectual
property right by reason of the manufacture, use or sale of the Cars unless such actual or alleged
infringement arises out of the compliance with designs, instructions or specifications furnished by
Buyer. In case the Cars or any part thereof are held to constitute such infringement or the use
thereof is enjoined, Seller shall, at its option, take one of the following three corrective
actions (each, a “Corrective Action”): (a) procure for Buyer the right to continue using the Cars
or part thereof, (b) replace the Cars or part thereof with a non infringing Car or part thereof, or
(c) take such measures as may be required to make the Cars or part thereof non infringing, in which
event Buyer shall deliver the Cars to Seller for that purpose. In the event that Seller fails to
effect a Corrective Action within * * * after Buyer’s written request, Seller shall * * *. The
foregoing states Seller’s entire liability with respect to any patent infringement by the Cars or
part thereof.

     13. Expenses. Whether or not the transactions contemplated hereby are consummated,
each party hereto shall pay its own expenses in connection with this Agreement and the transactions
contemplated hereby, including, without limitation, the fees and disbursements of its counsel.

     14. Entire Agreement. This Agreement and the Exhibits hereto contain the entire
agreement and understanding between the parties hereto with respect to the subject matter contained
herein and therein and supersede all prior agreements, understandings and representations; oral or
written. No modification, limitation or release of any terms and conditions contained herein or in
the Exhibits hereto shall be made except by mutual agreement to that effect in writing and signed
by the parties hereto.

     15. Governing Law. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF
NEW YORK, SHALL BE CONSTRUED IN ACCORDANCE WITH, AND THE RIGHTS AND LIABILITIES OF THE PARTIES
HEREUNDER SHALL

 

 

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     BE GOVERNED BY, THE LAWS OF SUCH STATE, WITHOUT REGARD TO ITS CONFLICTS OF LAW DOCTRINE, AND
THIS AGREEMENT SHALL BE DEEMED IN ALL RESPECTS TO BE A CONTRACT OF SUCH STATE. BOTH PARTIES CONSENT
TO THE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN NEW YORK, NEW YORK, FOR ANY ACTION
THAT MAY BE BROUGHT UNDER THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

     16. Notice. All communications under this Agreement shall be in writing or by a
telecommunications device capable of creating a written record, and any such notice shall become
effective (a) upon personal delivery thereof, including, without limitation, by overnight mail and
courier service, (b) five (5) days after the date on which it shall have been mailed by United
States mail (by certified mail, postage prepaid, return receipt requested), or (c) in the case of
notice by such a telecommunications device, when properly transmitted, addressed to each party at
the following addresses:

	 	 	 
	 

	 	If to Seller:
	 
	 	 
	 

	 	American Railcar Industries, Inc.
	 

	 	100 Clark Street
	 

	 	St. Charles, MO 63301
	 

	 	Attention: Alan C. Lullman, Senior Vice President
	 

	 	Facsimile No.: (636) 940-600
	 
	 	 
	 

	 	If to Buyer:
	 
	 	 
	 

	 	The CIT Group/Equipment Financing, Inc.
	 

	 	10 LaSalle Street
	 

	 	Chicago, IL 60603
	 

	 	Attn: Kenneth Hofacker, Vice President Mechanical
	 

	 	Operations
	 

	 	Facsimile No.: (312) 223-9980

or to any other address as may be given by any party to the other by notice pursuant
to the provisions of this Section 16.

     17. Waivers and Amendments; Non-Contractual Remedies; Preservation of
Remedies. This Agreement may be amended, superseded, modified, supplemented or terminated,
and the terms hereof may be waived, only by written instrument signed by the parties or, in the
case of a waiver, by the party waiving compliance. No delay on the part of any party in exercising
any right, power or privilege hereunder shall operate as a waiver thereof. No waiver on the part
of any party of any such right, power or privilege, nor any single or partial exercise of any such
right, power or privilege. The rights and remedies herein provided are cumulative and are not
exclusive of any rights or remedies that any party may otherwise have at law or in equity.

     18. Binding Effect; Assignment. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and permitted assigns. No assignment of
this Agreement or of any rights hereunder shall relieve the assigning party of any of its

 

 

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obligations or liabilities hereunder. This Agreement, and the certificates, schedules,
annexes and other documents executed and delivered at the closing in connection herewith are the
complete agreement of the parties regarding the subject matter hereof and thereof and supersede all
prior understandings (written or oral), communications and agreements.

     19. Counterparts. This Agreement may be executed by the parties in separate
counterparts, each of which when so executed and delivered shall be an original, but all such
counterparts shall together constitute one and the same instrument.

     20. Severability. Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law, such provision will
be effective only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision and the remaining provisions of this Agreement, and the remainder of
such provision and the remaining provisions of this Agreement shall be interpreted, to the maximum
extent possible, so as to conform to the original intent of this Agreement.

     21. Indemnification. Each party agrees that it shall indemnify and hold harmless the
other party from and against any loss, claim, damage or expense (including attorneys’ fees and
costs) attributable to a breach by such party of any of its obligations, representations or
warranties contained herein.

     22. Non-Disclosure. Seller agrees that the information contained in this Agreement as
well as other information provided to Seller by Buyer in connection with Buyer’s purchase of the
Cars (including but not limited to the price, type and number of railcars to be purchased,
particular configurations, designs or modifications, delivery locations and identity of Buyer’s
customers and parties to whom the Cars are to be delivered) is confidential and, except as provided
in this Agreement or required by Seller in order to fulfill the terms and conditions of Buyer’s
purchase, Seller shall not disclose any thereof to any third party. Seller shall similarly treat
any information provided to Seller by Buyer in connection with the purchase of the Cars prior to or
subsequent to the date of this Agreement as confidential in accordance with the terms hereof. All
of the foregoing is hereinafter referred to as the “Confidential Information.” In particular,
Seller agrees that it will not disclose any of the Confidential Information to any affiliate of
Seller engaged in the leasing of railcars or in the management of railcars or to the employees,
officers or directors of any such affiliate.

     Neither party, without the prior written consent of the other, shall issue any press release
or make any other public announcement or statement relating to Buyer’s purchase of the Cars or
containing any Confidential Information.

     Notwithstanding the foregoing, Confidential information shall not include: (a) such
information as is required to be made to UMLER and the Association of American Railroads, (b) such
information as is required to be disclosed by law, court or governmental agency or authority, (c)
such information as is required by either party’s accountants, auditors, insurance carriers or
other legal or financial advisors, and (d) information that becomes known to a party on a
non-confidential basis from a source as to which the party has no actual knowledge that such source
was bound by a confidentiality agreement with respect to such information.

 

 

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     Seller shall take reasonable security precautions, at least as great as the precautions it
takes to protect its own confidential information, to keep confidential the Confidential
Information, and will not otherwise use such Confidential Information for the benefit of any
affiliate engaged in the leasing or management of railcars or other third party.

     Seller shall notify Buyer immediately upon discovery of any unauthorized use or disclosure of
Confidential Information, and will cooperate with Buyer in every reasonable way to help Buyer
regain possession and control of the Confidential Information, and prevent its further unauthorized
use. Seller acknowledges that monetary damages may be inadequate to protect Buyer against actual
or threatened breach of this Agreement with respect to the Confidential Information. Accordingly,
Seller agrees that Buyer shall be entitled to seek injunctive relief for any such breach of
Seller’s obligations or representations under this Agreement with respect to the Confidential
Information. BUYER STIPULATES ACKNOWLEDGES AND AGREES THAT SELLER SHALL NOT BE LIABLE FOR ANY
SPECIAL CONSEQUENTIAL OR PUNITIVE DAMAGES FOR ANY BREACH OF _THIS AGREEMENT WITH RESPECT TO THE
CONFIDENTIAL INFORMATION BY SELLER OR BREACH OF SELLER’S REPRESENTATIONS HEREIN.

     23. Drawings. Seller agrees that all drawings and technical material, including
specifications, descriptions and tolerances relating to the Cars of any components thereof supplied
by Seller to Buyer (the “Drawings”), are the exclusive properly of Seller and contain confidential
and proprietary information. By accepting the Drawings from Seller, Buyer agrees to limit its use
of the Drawings solely to matters relating to Buyer’s use of the Cars, including the repair and
maintenance of the Cars. Buyer further agrees not to disclose the Drawings, or to disclose any
information contained in or derived from the Drawings to any person, including, but not limited to,
any other manufacturer of Cars or components; provided, however, in the event Buyer
sells any of the Cars, Buyer may deliver any Drawings relating to such Cars to the purchaser.
Seller agrees on Buyer’s written request, to provide Drawings to any car repair shop reasonably
satisfactory to Seller or other party reasonably satisfactory to Seller (other than another
manufacturer of Cars or components) provided that such car repair shop or other party agrees in
advance, in writing, to be bound by confidentiality provisions similar to those contained herein
and reasonably satisfactory to Seller.

     24. Termination. Without prejudice to any other right or remedy:

          (a) Either party may terminate this Agreement by written notice to the other party in the
event that:

               (i) the other party should breach this Agreement and such breach shall not be remedied within
* * * of the giving of notice of the breach; or

               (ii) a petition or complaint in bankruptcy or for reorganization is filed by or against the
other party or the other party becomes insolvent.

     25. Paragraph Headings. The paragraph headings contained in this Agreement are for
convenience of reference only and shall not effect in any way the meaning or interpretation of this
Agreement.

 

 

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     IN WITNESS WHEREOF, Seller and Buyer have executed this Agreement as of the day and year first
hereinabove set forth.

	 	 	 	 	 
	 	 	SELLER:
	 
	 	 	 	 
	 	 	AMERICAN RAILCAR INDUSTRIES, INC.
	 
	 	 	 	 
	 

	 	By:	 	/s/  James J. Unger
	 

	 	 	 	 
	 

	 	Title:	 	President and Chief Executive
Officer
	 
	 	 	 	 
	 	 	BUYER:
	 
	 	 	 	 
	 	 	THE CIT GROUP/EQUIPMENT
	 	 	FINANCING, INC.
	 
	 	 	 	 
	 

	 	By:	 	/s/  [ILLEGIBLE]

	 

	 	 	 	 
	 

	 	Title:

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