Document:

Exhibit 10.2

 

SECOND AMENDED AND RESTATED GUARANTY

 

THIS SECOND AMENDED AND RESTATED GUARANTY dated as of October 31, 2016, (as amended, supplemented and otherwise modified from time to time, this “Guaranty”), is made by Sutherland Partners, L.P. (f/k/a ZAIS Financial Partners, L.P.) (the “Guarantor”) in favor of Deutsche Bank AG, Cayman Islands Branch.

 

RECITALS

 

A.            ReadyCap Commercial, LLC, a Delaware limited liability company (“ReadyCap”), Sutherland Warehouse Trust II, a Delaware statutory trust (“Sutherland Trust II”),  Sutherland Asset I, LLC, a Delaware limited liability company (“Sutherland”, and together with ReadyCap, Sutherland Trust II and any other Seller that may become a party to the Repurchase Agreement from time to time in accordance with the provisions thereof, collectively, the “Sellers”, and the Sellers together with the Guarantor, collectively, the “Seller Parties”), U.S. Bank National Association, as Depository and Paying Agent, and Buyer have entered into that certain Second Amended and Restated Master Repurchase Agreement, dated as of June 9, 2016 (as amended, modified and/or restated, the “Repurchase Agreement”), pursuant to which Buyer may enter into Transactions with respect to Purchased Loans (as defined in the Repurchase Agreement) with the Sellers with a simultaneous agreement from the Sellers to repurchase such Purchased Loans, at a date certain or on demand (the “Transactions”);

 

B.            Buyer and Sutherland Partners, L.P., a Delaware limited partnership that is predecessor by merger to the Guarantor (the “Predecessor Guarantor”) have previously entered into that Amended and Restated Guaranty dated as of December 17, 2015, (the “Existing Guaranty”), whose terms shall be superseded in their entirety in accordance with the terms hereof.

 

C.            On or about the date hereof, the Predecessor Guarantor proposes to merge (such transaction, the “Sutherland Partners Merger”) into the Guarantor, with the Guarantor continuing as the surviving entity, and the Guarantor will change its legal name to Sutherland Partners, L.P.

 

D.            Simultaneously with the Sutherland Partners Merger, Sutherland Asset Management Corporation proposes to merge (such transaction, the “SAMC Merger” and together with the Sutherland Partners Merger, the “Proposed Mergers”) into ZAIS Merger Sub, LLC (“Merger Sub”), a wholly owned subsidiary of ZAIS Financial Corp, with Merger Sub continuing as the surviving entity.

 

E.            Buyer has requested, as a condition of consenting to the Proposed Mergers, that Guarantor deliver to Buyer this Guaranty;

 

F.             Guarantor is an Affiliate (as defined in the Repurchase Agreement) of each Seller and directly or indirectly controls each Seller;

 

 

G.            Guarantor expects to benefit if Buyer consents to the Proposed Mergers, and desires that Buyer consent to the Proposed Mergers; and

 

H.            Buyer would not consent to the Proposed Mergers unless Guarantor executed this Guaranty. This Guaranty is therefore delivered to Buyer to induce Buyer to consent to the Proposed Mergers.

 

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned hereby agrees as follows:

 

1.             Definitions.  Except as otherwise specified herein or as the context may otherwise require, the following terms have the respective meanings set forth below for all purposes of this Guaranty, and the definitions of such terms are equally applicable both to the singular and plural forms of such terms and to the masculine, feminine and neuter genders of such terms.  Capitalized terms not defined herein shall have the meanings used in the Repurchase Agreement.  The word “including” and its variations shall mean “including without limitation.” All references in this Guaranty to designated “Sections,” “Subsections” and other subdivisions are to the designated Sections, Subsections and other subdivisions of this Guaranty as originally executed.  The words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Guaranty as a whole and not to any particular Section, Subsection or other subdivision.

 

“Adjusted Tangible Net Worth”: For any Person, Net Worth minus (a) restricted cash (other than any portion of restricted cash that has a corresponding offsetting current liability); (b) 25% of investment securities that are rated below BBB by S&P or the equivalent thereof (other than ownership interests in any Affiliate) and (c) all intangible assets, including goodwill, patents, tradenames, trademarks, copyrights, franchises, any organizational expenses, deferred taxes and expenses, prepaid expenses, prepaid assets, receivables from shareholders, Affiliates or employees, mortgage servicing rights, mortgage servicing advances and any other asset as shown as an intangible asset on the balance sheet of such Person on a consolidated basis as determined at a particular date in accordance with GAAP (other  than any portion of such assets that has a corresponding offsetting current liability).

 

“Cash Liquidity”: As of any date of determination, an amount equal to the sum of (i) Cash and cash equivalents available to the Guarantor as of such date of determination and (ii) the amount of Cash and cash equivalents on deposit in the Cash Management Account as of such date of determination.

 

“Debt”: Total liabilities as determined in accordance with GAAP.

 

“Debt-to-Assets Ratio”: Expressed as a percentage as of any date of determination, (i) (A) Debt minus (B) Excluded Indebtedness divided by (ii) Total Assets net of any assets relating to Excluded Indebtedness.

 

“Disqualified Equity Interests”: Any Equity Interest which, by its terms (or by the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (i) matures or is mandatorily redeemable (other than solely for Equity Interests which are not otherwise Disqualified Equity

 

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Interests), pursuant to a sinking fund obligation or otherwise, (ii) is redeemable at the option of the holder thereof (other than solely for Equity Interests which are not otherwise Disqualified Equity Interests), in whole or in part or (iii) provides for scheduled payments or dividends in cash, or (iv) is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute Disqualified Equity Interests, in each case, prior to the date that is 91 days after the Facility Termination Date.

 

“Equity Interests”: Any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), including partnership interests and membership interests, and any and all warrants, rights or options to purchase or other arrangements or rights to acquire any of the foregoing.

 

“Excluded Indebtedness”: Indebtedness included in the Guarantor’s financial statements in accordance with GAAP but which none of the Guarantor or its subsidiaries (other than subsidiaries that are CDOs or other securitization entities) is obligated to pay, including all CDOs or other securitization vehicles that are consolidated in accordance with GAAP.

 

“Existing Guaranty”: The meaning assigned in the recitals hereto.

 

“Government-Sponsored Enterprise”:  Each of the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation and the Government National Mortgage Association.

 

“Guarantied Obligations”: the Seller Parties’ obligations to fully and promptly pay all sums owed to Buyer under the Repurchase Agreement, the Letter Agreement, and the other Transaction Documents and to Buyer and any Affiliated Hedge Counterparties under any Approved Hedging Transactions with Affiliated Hedge Counterparties, at the times and according to the terms required by the Transaction Documents or the applicable Approved Hedging Transaction documents, as applicable, including the Repurchase Price for each Purchased Loan, accrued interest, default interest, indemnity amounts, costs, or fees (including any such interest, costs or fees arising from and after the filing of an Insolvency Proceeding against the Seller Parties or either of them), without regard to any modification, suspension, or limitation of such terms not agreed to by Buyer, such as a modification, suspension, or limitation arising in or pursuant to any Insolvency Proceeding affecting any Seller Party (even if any such modification, suspension, or limitation causes such Seller Party’s obligation to become discharged or unenforceable, and in the case of an Insolvency Proceeding against the Seller Parties or either of them, even if such modification was made with Buyer’s consent or agreement).

 

“Indebtedness”: As applied to any Person, without duplication, (i) all indebtedness for borrowed money; (ii) that portion of obligations with respect to capital leases that is properly classified as a liability on a balance sheet in conformity with GAAP; (iii) notes payable and drafts accepted representing extensions of credit whether or not representing obligations for borrowed money; (iv) any obligation owed for all or any part of the deferred purchase price of property or services, including any earn-out obligations (excluding any such obligations incurred under ERISA), which purchase price is evidenced by a note or similar

 

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written instrument; (v) all indebtedness secured by any lien on any property or asset owned or held by that Person regardless of whether the indebtedness secured thereby shall have been assumed by that Person or is non-recourse to the credit of that Person; (vi) the face amount of any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings; (vii) Disqualified Equity Interests, (viii) the direct or indirect guaranty, endorsement (otherwise than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of another that would otherwise be “Indebtedness” for purposes of this definition; (ix) any obligation of such Person the primary purpose or intent of which is to provide assurance to an obligee that the obligation of the obligor that would otherwise be “Indebtedness” for purposes of this definition thereof shall be paid or discharged, or any agreement relating thereto shall be complied with, or the holders thereof shall be protected (in whole or in part) against loss in respect thereof; (x) any liability of such Person for any Indebtedness of another through any agreement (contingent or otherwise) (a) to purchase, repurchase or otherwise acquire such Indebtedness or any security therefor, or to provide funds for the payment or discharge of such obligation (whether in the form of loans, advances, stock purchases, capital contributions or otherwise) or (b) to maintain the solvency or any balance sheet item, level of income or financial condition of another if, in the case of any agreement described under subclauses (a) or (b) of this clause (x), the primary purpose or intent thereof is as described in clause (ix) above; and (xi) all obligations (the amount of which shall be determined on a net basis where permitted in the relevant contract) of such Person in respect of any exchange traded or over the counter derivative transaction, including any interest rate swap and any currency swap, in each case, whether entered into for hedging or speculative purposes.

 

“Liquidity”: As of any date of determination, an amount equal to the sum of (i) Cash Liquidity available to the Guarantor as of such date of determination, (ii) an amount equal to 75% of the undrawn but available capacity under all working capital or revolving credit facilities maintained by the Guarantor, as determined by, and if acceptable to, the Buyer in its reasonable discretion and (iii) an amount equal to 50% of the value of all liquid investment-grade commercial-mortgage-backed securities held by the Guarantor, as determined by, and if acceptable to, the Buyer in its reasonable discretion.

 

“Net Worth”: With respect to any Person, the excess of total assets of such Person, over total liabilities of such Person, determined in accordance with GAAP.

 

“Non-Recourse Indebtedness”:  With respect to any specified Person or any of its Affiliates, Indebtedness that is (A) specifically advanced to finance the acquisition of investment assets and secured only by the assets to which such Indebtedness relates without recourse to such Person or any of its Affiliates (other than subject to such customary carve-out matters for which such Person or its Affiliates acts as a guarantor in connection with such Indebtedness, such as fraud, misappropriation, breach of representation and warranty and misapplication, unless, until and for so long as a claim for payment or performance has been made thereunder (which has not been satisfied) at which time the obligations with respect to any such customary carve-out shall not be considered Non-Recourse Indebtedness, to the extent that such claim is a liability of such Person for GAAP purposes) or (B) secured by (i) bonds, debentures, treasury bills, notes or other securities issued by the government of the United States of America or (ii) Qualified GSE Securities.

 

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“Qualified GSE Securities”:  Any certificates, notes or other securities that are (i) issued and guaranteed by a Government-Sponsored Enterprise and (ii) secured by one or more pools of mortgage loans acquired by such Government-Sponsored Enterprise; for the avoidance of doubt, Qualified GSE Securities shall not include any collateralized mortgage obligations, collateralized debt obligations, credit default swaps, forward contracts, futures contracts, options or any other derivative issued by a Government-Sponsored Enterprise.

 

“Recourse Indebtedness”:  All Indebtedness other than Non-Recourse Indebtedness and Securitization Indebtedness.

 

“Securitization”: A public or private transfer, sale or financing of (i) servicing advances, (ii) mortgage loans, (iii) installment contracts, (iv) other loans and related assets or (v) any other receivables (clauses (i) — (v) above, collectively, the “Securitization Assets”) by which any Seller Party or any of their respective Affiliates directly or indirectly securitizes a pool of specified Securitization Assets including, without limitation, any such transaction involving the sale of specified servicing advances or mortgage loans to a Securitization Entity.

 

“Securitization Entity”: (i) Any Person (whether or not an Affiliate of the Guarantor) established for the purpose of issuing asset-backed or mortgaged-backed or mortgage pass-through securities of any kind (including collateralized mortgage obligations and net interest margin securities) and (ii) any special purpose entity established for the purpose of selling, depositing or contributing Securitization Assets into a Person described in clause (i) or holding securities in any related Securitization Entity, regardless of whether such person is an issuer of securities; provided that such Person is not an obligor with respect to any Indebtedness of the Guarantor.

 

“Securitization Indebtedness”: (i) Indebtedness of the Guarantor or any of its respective Affiliates incurred pursuant to on-balance sheet Securitizations and (ii) any Indebtedness consisting of advances made to the Guarantor or any of its Affiliates based upon securities issued by a Securitization Entity pursuant to a Securitization and acquired or retained by the Guarantor or any of its respective Affiliates.

 

“Tangible Net Worth”: As of any date of determination and with respect to any Seller Party, the excess of total assets (net of goodwill and intangible assets) over total liabilities on such date, calculated in accordance with GAAP, as reported on such party’s most recently delivered financial statements.

 

“Total Assets”: Total assets determined in accordance with GAAP.

 

2.             Guaranty.  Guarantor hereby unconditionally and irrevocably guarantees to Buyer the prompt and complete payment and performance by the Seller Parties when due (whether at the stated maturity, by acceleration or otherwise) of the Guarantied Obligations. All assets and property of Guarantor shall be subject to recourse if Guarantor fails to pay any Guarantied Obligation(s) when and as required to be paid pursuant to the Transaction Documents.

 

In addition to the foregoing, the Guarantor hereby absolutely, irrevocably and unconditionally guarantees to the Buyer any actual loss, damage, cost, expense, liability, claim or

 

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other obligation incurred directly or indirectly by Buyer (including reasonable and documented out-of-pocket fees and expenses of external counsel to the Buyer) but, in each case under this clause, only to the extent arising out of or in connection with: (i) fraud, misrepresentation, malfeasance, misconduct or bad faith, misapplication, misappropriation or conversion of funds, criminal acts, or the wrongful removal or destruction of the Collateral by any Seller Party in connection with the Repurchase Agreement or any other Transaction Document to which such Seller Party is a party, (ii) the commencement by any Seller Party, or the filing by any Seller Party of any pleading or document with a court in support of the commencement of, any case under any applicable state or federal bankruptcy, insolvency or other similar law with respect to any Seller Party, (iii) the breach in any material respect by any Seller Party at any time on or after the Closing Date of any of the representations and warranties made by it that are contained in the Repurchase Agreement or any other Transaction Document or (iv) any action, suit or proceeding, arbitration or governmental investigation arising out of, or in connection with, any Purchased Loan, any Mortgagor, any guarantor, or any Affiliate of any Mortgagor or guarantor, other than in connection with the enforcement of the related Loan Documents by the Seller Parties.

 

It is expressly understood that this is a continuing guaranty and that the Guarantor’s obligations under this Guaranty shall not be affected by the genuineness, validity, regularity, or enforceability of the obligations of the Seller Parties under the Transaction Documents (the “Obligations”) or of any agreement or instrument evidencing the Obligations, or by the validity, enforceability, or perfection of any security interest against, or the nature or extent of, any collateral for the Obligations, or by any amendment of the Repurchase Agreement or any other Transaction Document to which the Obligations relate, or by any other circumstance relating to the Obligations (including a bankruptcy proceeding involving any Seller Party as debtor) which might otherwise constitute a discharge of, or defense to, the Obligations or this Guaranty.  This is a guaranty of payment and not of collection and the Buyer shall not be obligated to file any claim relating to the Obligations if a Seller Party becomes subject to a bankruptcy, reorganization, or similar proceeding and the failure of the Buyer so to file shall not affect the Guarantor’s obligations hereunder.

 

3.             Expenses.  The Guarantor shall pay on demand all reasonable and documented out-of-pocket expenses (including the reasonable and documented out-of-pocket fees and expenses of external counsel to the Buyer) incurred in the enforcement or protection of the rights of the Buyer under this Guaranty, which out-of-pocket expenses shall not be subject to any cap.

 

4.             Continuing Agreement.  This Guaranty shall remain in full force and effect and be binding upon the Guarantor and its successors and permitted assigns until one year and one day following the Facility Termination Date and all of the Seller Parties’ obligations under the Repurchase Agreement and the other Transaction Documents have been satisfied.

 

5.             No Waiver: Cumulative Rights.  No failure on the part of the Buyer to exercise, and no delay in exercising, any right, remedy, or power under this Guaranty shall operate as a waiver thereof, nor shall any single or partial exercise by the Buyer of any right, remedy, or power hereunder preclude any other or future exercise of any right, remedy, or power.  Each and every right, remedy and power hereby granted to the Buyer or allowed it by

 

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law or other agreement with the Guarantor, shall be cumulative and not exclusive of any other and may be exercised by the Buyer from time to time.

 

6.             Waiver of Notice.  Except as expressly required herein, the Guarantor waives notice of the acceptance of this Guaranty, presentment to, or demand of, payment from anyone liable for any of the obligations, notice of dishonor or non-payment, protest, diligence, suit, notice of any sale of any Collateral, notice of the taking of any action by the Buyer against the Seller Parties or others and all other notices that may otherwise be required by law.

 

7.             Representations and Warranties.  The Guarantor hereby makes the following representations and warranties to the Buyer as of the date hereof:

 

(a)           The Guarantor is (i) duly organized and validly existing under the laws of the jurisdiction of its organization and, if relevant under such laws, in good standing and has full power and authority to execute, deliver, and perform this Guaranty and (ii) duly qualified to do business in all jurisdictions necessary.

 

(b)           The execution, delivery, and performance of this Guaranty have been and remain duly authorized by all necessary action and do not contravene any provision of the Guarantor’s constitutive documents, as amended to date, or any law, regulation, rule, decree, order, judgment, or contractual restriction binding on the Guarantor or its assets.  There is no material litigation pending against the Guarantor before any Governmental Authority (i) asserting the invalidity of this Guaranty or (ii) seeking any determination or ruling that could be reasonably likely to have a material adverse effect on the Guarantor’s ability to perform under this Guaranty.

 

(c)           All consents, licenses, authorizations, and approvals of, and registrations and declarations with, any governmental authority or regulatory body necessary for the due execution, delivery, and performance of this Guaranty have been obtained and remain in full force and effect and all conditions thereof have been duly complied with, and no other action by, and no notice to or filing with, any governmental authority or regulatory body is required in connection with the execution, delivery, or performance of this Guaranty.

 

(d)           This Guaranty constitutes the legal, valid, and binding obligation of the Guarantor and is enforceable against the Guarantor in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium, conservatorship, receivership, and other laws of general applicability relating to, or affecting, creditors’ rights and, subject as to enforceability, to equitable principles of general application.

 

(e)           Guarantor is not and has never been the subject of any case under any applicable state or federal bankruptcy, insolvency or other similar law.  Guarantor is solvent and will not be rendered insolvent by the transactions contemplated hereby.  Guarantor does not intend to incur, nor does it believe that it has incurred, debts beyond its ability to pay such debts as they mature and is not contemplating the commencement of insolvency, bankruptcy, liquidation or consolidation proceedings or the appointment of a receiver, liquidator, conservator, trustee or similar official in respect of such entity or any of its assets.

 

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(f)            Guarantor has complied in all material respects with all laws, statutes, rules, regulations of any Governmental Authority applicable to Guarantor.

 

(g)           There has been no material adverse change in the business, operations, financial condition, properties or prospects of Guarantor since September 30, 2016.

 

(h)           Guarantor is not required to register as an “investment company”, or as a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended.

 

(i)            Guarantor is not and is not acting on behalf of an “employee benefit plan” as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), that is subject to Title I of ERISA, a “plan” as defined in and subject to Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”), any other employee benefit plan that is subject to any law that is substantially similar to Section 406 of ERISA or Section 4975 of the Code, or an entity deemed to hold the plan assets of any of the foregoing pursuant to 29 C.F.R. Section 2510.3-101, as modified by Section 3(42) of ERISA, or otherwise.

 

8.             Covenants of Guarantor.  Guarantor hereby covenants and agrees that:

 

(a)           Guarantor shall (i) preserve and maintain its legal existence, (ii) qualify and remain qualified in good standing in the jurisdiction in which it is organized, and (iii) comply with its certificate of formation and by-laws.

 

(b)           At all times during the term of this Guaranty, Guarantor will promptly, and in any event within ten (10) days after service of process on any of the following, give to the Buyer notice of all litigation, actions, suits, or other legal proceedings affecting Guarantor that (i) questions or challenges the validity or enforceability of this Guaranty or (ii) which, individually or in the aggregate, if adversely determined, could be reasonably likely to have a material adverse effect on the Guarantor’s ability to perform under this Guaranty.

 

(c)           Guarantor will not enter into transactions, including, without limitation, any purchase, sale, lease or exchange of property or the rendering of any service, with any Seller Party unless the transaction is (i) in the ordinary course of Guarantor’s business and (ii) upon fair and reasonable terms no less favorable to Guarantor than it would obtain in a comparable arm’s length transaction with a Person which is not an Affiliate.

 

(d)           Guarantor shall not institute against any other Seller Party any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law.

 

(e)           The Guarantor shall provide to Buyer and the Verification Agent, as soon as available, and in any event within 90 days after the end of each fiscal year of the Guarantor, audited financial statements of the Guarantor for such fiscal year.

 

(f)            The Guarantor shall compile and provide to Buyer and the Verification Agent, as soon as available and in any event no later than forty-five (45) Business Days following the end of each calendar quarter, (i) quarterly financial statements for such calendar

 

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quarter, (ii) a calculation of all amounts required to be determined with respect to the Financial Covenants as of the related Pricing Rate Determination Date for the final calendar month of such calendar quarter, (iii) a certificate of an Authorized Officer of the Guarantor confirming that the Guarantor continues to comply with the representations, warranties and covenants set forth herein and (iv) any other reports reasonably requested by Buyer and generated in the ordinary course of business of the Guarantor.

 

(g)           The Adjusted Tangible Net Worth as set forth on the most recent financial statement of the Guarantor shall not decline by more than (i) 25% in any calendar quarter, (ii) 35% in any calendar year, or (iii) 50% from the highest Adjusted Tangible Net Worth of the Guarantor set forth in its most recent audited financial statements.

 

(h)           The Guarantor shall maintain Liquidity in an amount no less than the greater of (i) $5,000,000 and (ii) 3% of the sum of (A) any outstanding Recourse Indebtedness plus (B) the Aggregate Repurchase Price; provided, however, that no less than two-thirds of the Liquidity maintained by the Guarantor to satisfy this paragraph (h) shall be Cash Liquidity.

 

(i)            The Guarantor shall maintain a Debt-to-Assets Ratio no greater than 80%.

 

(j)            The Guarantor shall maintain Tangible Net Worth in an amount at least equal to the sum of (i) the product of (A) 1/9th and (B) the amount of all Non-Recourse Indebtedness (excluding the Aggregate Repurchase Price) and the amount of other Securitization Indebtedness, in each case, held by entities other than Affiliates of the Guarantor plus (ii) the product of (A) 1/3rd and (B) the sum of (x) the Aggregate Repurchase Price and (y) all Recourse Indebtedness (the covenants in paragraphs (g), (h), (i) and (j) shall collectively be referred to as the “Financial Covenants”).

 

(k)           Guarantor shall provide written notice to Buyer upon the occurrence of (i) any change to its name, jurisdiction of organization or taxpayer identification number or (ii) any reorganization resulting in the Guarantor no longer being organized as a corporation.

 

(l)            Guarantor agrees that should SAMC or any of its direct or indirect subsidiaries enter into any financing agreement or other credit facility with respect to small business loans or mortgage loans with any Person other than Buyer or an Affiliate of Buyer which by its terms provides more favorable terms to Buyer with respect to any financial covenants set forth in Section 8 hereof or any substantially similar  covenants (a “More Favorable Agreement”), the terms of this Guaranty shall be deemed automatically amended to include such more favorable terms contained in such More Favorable Agreement; provided, that in the event that such More Favorable Agreement is terminated, upon notice by the Guarantor to the Buyer of such termination, the original terms of this Guaranty shall be deemed to be automatically reinstated. The Guarantor further agrees to execute and deliver any new guaranties, agreements or amendments to this Guaranty evidencing such provisions, provided that the execution of such amendment shall not be a precondition to the effectiveness of such amendment, but shall merely be for the convenience of the parties hereto. Promptly upon Guarantor or any of its Affiliates entering into a financing agreement or other credit facility with respect to assets similar to the Mortgage Loans with any Person other than the Buyer or an Affiliate of the Buyer, the Guarantor shall deliver to the Buyer (x) a true, correct and complete

 

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copy of such financing documentation (excluding pricing terms) or (y) to the extent the Guarantor is prohibited from delivering any such document pursuant to a confidentiality agreement with such Person, to the fullest extent permitted pursuant to such confidentiality agreement, a certificate of the Guarantor setting forth the terms of any financial covenants or substantially similar terms thereof.

 

(m)          Guarantor will not become and will not act on behalf of an “employee benefit plan” as defined in Section 3(3) of ERISA that is subject to Title I of ERISA, a “plan” as defined in and subject to Section 4975 of the Code, any other employee benefit plan that is subject to any law that is substantially similar to Section 406 of ERISA or Section 4975 of the Code, or an entity deemed to hold the plan assets of any of the foregoing pursuant to 29 C.F.R. Section 2510.3-101, as modified by Section 3(42) of ERISA, or otherwise.

 

9.             Events of Default.  Notwithstanding anything to the contrary in the Repurchase Agreement, each of the following events shall constitute an event of default under the Repurchase Agreement (each, an “Event of Default”):

 

(a)           the issuance by a Governmental Authority of an order or decree to wind-up or liquidate the affairs of the Guarantor or the property of the Guarantor, which decree or order shall remain unstayed and in effect for a period of ninety (90) consecutive days; and

 

(b)           the failure of the Guarantor to comply with any material covenant contained herein, which such failure remains unremedied more than ten (10) days (except if such default or breach is curable and the Guarantor diligently attempts to cure such default, and such default or breach continues for thirty (30) days).

 

10.          No Subrogation.  Notwithstanding any payment or payments made by Guarantor hereunder or any set-off or application of funds of Guarantor by the Buyer or any of its Affiliates, Guarantor shall not be entitled to be subrogated to any of the rights of Buyer against any Seller Party or any collateral security or guarantee or right of offset held by Buyer for the payment of the Guarantor’s obligations under this Guaranty, nor shall Guarantor seek or be entitled to seek any contribution or reimbursement from any other Seller Party in respect of payments made by Guarantor hereunder, until one year and one day following the Facility Termination Date under the Repurchase Agreement and all of the Seller Parties’ obligations under the Repurchase Agreement and the other Transaction Documents have been satisfied.  If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid and satisfied in full, such amount shall be held by Guarantor in trust for the Buyer, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to the Buyer in the exact form received by Guarantor (duly indorsed by Guarantor to Buyer, if required), to be applied against the Obligations, whether matured or unmatured, in such order as the Buyer may determine.

 

11.          Waiver of Rights.  Except as otherwise expressly provided herein, Guarantor waives any and all notice of any kind including, without limitation, notice of the creation, renewal, extension or accrual of any of the Obligations, and notice of or proof of reliance by the Buyer upon this Guaranty or acceptance of this Guaranty; the Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or

 

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renewed, extended, amended or waived, in reliance upon this Guaranty; and all dealings between any Seller Party, on the one hand, and Buyer, on the other hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon this Guaranty.  Guarantor waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon any Seller Party with respect to the Obligations or Guarantor with respect to the Guarantor’s obligations under this Guaranty.  In addition, Guarantor waives any requirement that Buyer exhaust any right, power or remedy or proceed against any Seller Party.

 

12.          Recapture of Certain Payments.  Guarantor further agrees that, to the extent that the Guarantor makes a payment or payments to the Buyer, which payment or payments or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to the Guarantor or their respective estate, trustee, receiver or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then to the extent of such payment or repayment, this Guaranty and the advances or part thereof which have been paid, reduced or satisfied by such amount shall be reinstated and continued in full force and effect as of the date such initial payment, reduction or satisfaction occurred.

 

13.          Assignment.  The rights and obligations of the Guarantor under this Guaranty shall not be assigned by the Guarantor without the prior written consent of the Buyer, except that any person into which the Guarantor may be merged or consolidated, or any person resulting from any merger, conversion or consolidation to which the Guarantor is a party, or any person succeeding to all or substantially all of the business of the Guarantor, shall be the successor to the Guarantor hereunder and shall comply with all obligations of the Guarantor arising under this Guaranty.  Subject to the foregoing, this Guaranty shall bind and inure to the benefit of and be enforceable by the Guarantor and the Buyer, and their respective successors and permitted assigns.

 

14.          GOVERNING LAW; JURISDICTION; WAIVER OF JURY  TRIAL.  THIS GUARANTY SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAWS, WHICH SHALL APPLY HERETO), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.  WITH RESPECT TO ANY SUIT, ACTION, CLAIM, OR PROCEEDINGS RELATING TO THIS GUARANTY (“PROCEEDINGS”), THE GUARANTOR IRREVOCABLY: (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN THE STATE OF NEW YORK; (II) WAIVES ANY OBJECTION WHICH IT MAY HAVE AT ANY TIME TO THE LAYING OF VENUE OF ANY PROCEEDINGS BROUGHT IN ANY SUCH COURT, WAIVES ANY CLAIM THAT SUCH PROCEEDINGS HAVE BEEN BROUGHT IN AN INCONVENIENT FORUM, AND FURTHER WAIVES THE RIGHT TO OBJECT, WITH RESPECT TO SUCH PROCEEDINGS, THAT SUCH COURT DOES NOT HAVE JURISDICTION OVER SUCH PARTY; AND (III) TO THE EXTENT PERMITTED BY APPLICABLE LAW, WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY.

 

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15.          Notices.  All demands, notices and communications hereunder shall be in writing and shall be deemed to have been duly given if personally delivered to or mailed, by registered mail, postage prepaid, by overnight mail or courier service, or transmitted by facsimile and confirmed by similar mailed writing, if to the Buyer, addressed to the Buyer at 60 Wall Street, 3rd Floor, New York, New York 10005, Attention: Timur Otunchiev, or such other address as may be designated by the Buyer to the Guarantor in writing, or, if to the Guarantor, addressed to the Guarantor at 1140 Avenue of Americas, 7th Floor, New York, NY 10036, Attention: Rick Herbst, Email: rherbst@waterfallam.com, Facsimile: 212-257-4699, or such other address as may be designated by the Guarantor to the Buyer in writing.

 

16.          Miscellaneous.

 

(a)           Amendments.  Any amendment, modification, or waiver of any term or provision of this Guaranty shall be in writing and shall be signed by the Guarantor and the Buyer.

 

(b)           Headings.  The headings of this Guaranty are for convenience of reference only and shall not affect the meaning or construction of any provision hereof.

 

(c)           Entire Agreement.  This Guaranty contains the entire agreement between the parties hereto relating to the subject matter hereof and supersedes all oral statements and prior writings with respect thereto.

 

(d)           Counterparts.  This Guaranty may be executed in any number of counterparts, each of which, when so executed and delivered, shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument.

 

(e)           Limitation.  Nothing expressed or implied herein is intended or shall be construed to confer upon any person, firm or corporation, other than the parties hereto, any right, remedy or claim by reason of this Guaranty or any term hereof, and all terms contained herein shall be for the sole and exclusive benefit of the parties hereto, and their successors and permitted transferees.

 

17.          Restatement.        This Guaranty amends and restates in its entirety, as of the date hereof, the Existing Guaranty. Upon the effectiveness of this Guaranty, each reference to the Existing Guaranty in any other document, instrument or agreement shall mean and be a reference to this Guaranty. Nothing contained herein, unless expressly herein stated to the contrary, is intended to amend, modify or otherwise affect any other instrument, document or agreement executed and/or delivered in connection with the Existing Guaranty.

 

[Signature pages follow]

 

12

 

IN WITNESS WHEREOF, this Guaranty has been duly executed and delivered by the Guarantor to the Buyer as of the date first above written.

 

	
 
    	
SUTHERLAND   PARTNERS, L.P.
    
	
 
    	
 
    
	
 
    	
By:   SUTHERLAND ASSET MANAGEMENT
   CORPORATION, not in its individual capacity

but   solely as general partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Frederick Herbst
    
	
 
    	
Name:
    	
Frederick   Herbst
    
	
 
    	
Title:
    	
Chief   Financial Officer
    

 

Second Amended and Restated Guaranty

 

S-1

 

Acknowledged and agreed to:

 

	
DEUTSCHE   BANK AG, CAYMAN
    	
 
    
	
ISLANDS   BRANCH
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Ryan M. Stark
    	
 
    
	
Name:
    	
Ryan   M. Stark
    	
 
    
	
Title:
    	
Managing   Director
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Timur Otunchiev
    	
 
    
	
Name:
    	
Timur   Otunchiev
    	
 
    
	
Title:
    	
Managing   Director
    	
 
    

 

Second Amended and Restated Guaranty

 

S-2Exhibit

Exhibit 10.1

CONSULTING SERVICES AGREEMENT
This Consulting Services Agreement (this “Agreement”), dated as of February 15, 2017, (the “Effective Date”), is made and entered into between American Railcar Industries, Inc., a corporation organized under the laws of the State of North Dakota (together with its successors and assigns, the “Consultant”), and American Railcar Leasing LLC, a limited liability company organized under the laws of the State of Delaware (together with its Subsidiaries, and its and their respective successors and assigns, the “Company”).
RECITALS
 
WHEREAS, the Company desires to retain the Consultant to provide the Services (as defined below), and the Consultant is willing to perform such Services, each under the terms and conditions hereinafter set forth;
NOW THEREFORE, in consideration of the premises and the mutual agreements herein contained, the Company and the Consultant (hereinafter, collectively, the “Parties”, or each, individually, a “Party”) hereby agree as follows:
1.  Definitions. As used herein, the following terms shall have the following meanings: 
“Affiliate” of any Person means any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. For purposes of this definition, “control,” when used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by contract or otherwise. The terms “controlling” and “controlled” have the meanings correlative to the foregoing.
“Agreement” shall have the meaning set forth in the preamble hereof.
“Company” shall have the meaning set forth in the preamble hereof.
“Consultant” shall have the meaning set forth in the preamble hereof.
“Effective Date” shall have the meaning set forth in the preamble hereof.
“Indemnified Party” shall have the meaning set forth in Section 7 hereof.
“Losses” shall have the meaning set forth in Section 7 hereof.
“Party” or “Parties” shall have the meaning set forth in the recitals hereof.
“Person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust, unincorporated organization or other entity, or governmental authority. 

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“Related Party” means the officers, directors, stockholders, employees, agents, representatives and Affiliates of any Person. 
“RMTA” means that certain Railcar Management Transition Agreement, dated December 16, 2016 by and among American Railcar Industries, Inc., American Railcar Leasing LLC, American Entertainment Properties Corp., SMRSH LLC and SMBC Rail Services LLC.
“Services” means the services set forth on Schedule A hereto, as amended from time to time by mutual written agreement of the Parties. 
“Subsidiary” means, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership, limited liability company or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person.
“Term” means the term of the respective obligations of Consultant and Company hereunder, commencing as of the Effective Date and continuing until terminated in accordance with the terms and provisions set forth herein.
2. Engagement. 
2.1.    The Company hereby engages the Consultant to provide the Services to the Company on the terms and conditions set forth herein and the Consultant hereby accepts such engagement. The Parties acknowledge and agree that in order to provide the Services, the Consultant may designate and cause one or more individuals who are employees of the Consultant or its Subsidiaries to provide the Services to the Company as provided on Schedule A.
2.2.    Subject to the terms and provisions hereof, Consultant shall provide or arrange for the provision of the Services to and on behalf of the Company during the Term in the same manner as Consultant performs such services on its own behalf. The Company shall furnish to Consultant all such information as may be reasonably necessary to enable Consultant to provide the Services. Any Service to be provided by Consultant under this Agreement shall be performed by Consultant or any other Person with the capability to provide such Service that Consultant designates to provide such Service.
2.3.    Company shall request Services, from time to time, on the form set forth on Schedule B (the “Services Request Form”) and Consultant shall provide such Services pursuant to the terms hereof.
3.  Fees and Expenses.

For the Services to be performed hereunder, the Company shall pay to the Consultant the total weekly fee in the amount indicated by the Consultant set forth on each applicable Services Request Form.  The weekly fee shall be paid as soon as practicable after the Consultant submits the applicable 

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Services Request Form to Company for payment.  In addition, the Company shall reimburse Consultant for all reasonable and documented costs and expenses incurred in accordance with this Agreement.

4. Termination. 

This Agreement is terminable by the Consultant or the Company upon five (5) business days’ prior written notice with respect to any or all of the Services, which termination shall be effective as of the date as such notice may specify.  This Agreement shall automatically terminate on the date that the sale of ARL’s equity interests to SMBC Rail Services LLC occurs, unless previously terminated prior thereto.  Notwithstanding the foregoing or any provisions of the RMTA, the obligation to pay any fees and expenses incurred by Company through the date of termination of this Agreement shall survive such termination and be payable in accordance with Section 3 or as otherwise agreed by the Parties.
5. Independent Contractor.
5.1.    It is understood and acknowledged that the Services which the Consultant will provide to the Company hereunder shall be in the capacity of an independent contractor and not as an employee or agent of the Company. Nothing herein shall be construed to create a joint venture or partnership between the Parties hereto. Nothing in this Agreement shall be deemed or construed to enlarge the fiduciary duties and responsibilities, if any, of the Consultant or any of its Related Parties, including without limitation in any of their respective capacities as members or employees of the Company.
5.2.    Consultant shall control the conditions, time, details and means by which Consultant performs the Services.
5.3.    Consultant shall have the exclusive right to select, employ, pay, supervise, administer, direct and discharge any of the employees of Consultant who will perform the Services. The Parties acknowledge that employees of Consultant are not, and shall not be deemed to be employees of Company, but are, at all times, employees of Consultant. Consultant shall be solely responsible for paying such employees’ compensation and providing to such employees any benefits. 
6. Disclaimer; Limitation of Liability. 
6.1.    The Consultant makes no representations or warranties, express or implied, in respect of the Services to be provided by it hereunder.
6.2.    The Consultant and its directors, officers and employees assume no liability hereunder for anything other than to render or stand ready to render the Services specifically called for herein or on any Schedule hereto, and neither the Consultant nor any of its Subsidiaries or Related Parties (other than the Company) shall be responsible hereunder for any action of the Company under any agreements, instruments or documents to which the Company is a party. Neither the Consultant nor any director, officer or employee of the Consultant shall be liable hereunder for 

3

or shall have any obligation with regard to any of the liabilities, whether direct or indirect, absolute or contingent, of the Company in connection with such agreements, instruments or documents.
6.3.    Neither the Consultant nor any of its Subsidiaries or Related Parties (other than the Company) shall be liable to the Company or any of its Affiliates for any loss, liability, damage or expense arising out of or in connection with the performance of any Services contemplated by this Agreement, unless such loss, liability, damage or expense shall be proven to result directly from the willful misconduct of such person. In no event will the Consultant or any of its Related Parties be liable to the Company for special, indirect, punitive or consequential damages, including, without limitation, loss of profits or lost business, even if the Consultant has been advised of the possibility of such damages. Under no circumstances will the liability of the Consultant or any of its Related Parties exceed, in the aggregate, the fees actually paid to the Consultant hereunder.
6.5.    The provisions of this Section 6 shall survive termination of this Agreement.
7. Indemnification. 
Company shall indemnify, defend and hold harmless the Consultant and each of its Related Parties, successors and permitted assigns (each, an “Indemnified Party”) from and against any and all losses, damages, liabilities, deficiencies, claims, actions, judgments, settlements, interest, awards, penalties, fines, costs, or expenses of whatever kind, including reasonable attorneys’ fees, fees and the costs of enforcing any right to indemnification under this Agreement and the cost of pursuing any insurance providers, incurred by an Indemnified Party or awarded against an Indemnified Party in a final judgment (collectively, “Losses”), relating to, arising out of or resulting from any claim of a third party or otherwise arising out of, relating to or occurring in connection with the Services or other matters referred to in or contemplated by this Agreement or the engagement of such Indemnified Party pursuant to, and the performance by such Indemnified Party, of the Services or other matters referred to or contemplated by this Agreement. The Company will not be liable under the foregoing indemnification provision to the extent that any Losses are determined by a court, in a final judgment, to have resulted primarily from the willful misconduct of such Indemnified Party. The reimbursement and indemnity obligations of the Company, under this Section 7 shall be in addition to any liability which the Company may otherwise have. The provisions of this Section 7 shall survive termination of this Agreement.
8. Permissible Activities; Non-Exclusive. 
Nothing herein shall in any way preclude the Consultant or its Affiliates or their respective Related Parties from engaging in any business activities or from performing services for its or their own account or for the account of others, including without limitation companies which may be in competition with the business conducted by the Company and any of its Affiliates. Nothing contained herein prohibits the engagement of another consultant to represent the Company in any matter by, and in the discretion of, the management of the Company or a governing body of the Company, and nothing contained herein constitutes a representation that the Company will request that any Services be performed by the Consultant pursuant to this Agreement or otherwise. 

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9. Entire Agreement. 
This Agreement, including and together with any related schedules, constitutes the sole and entire agreement of the Parties with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, regarding such subject matter.
10. Notices. 
Any notice, certificate, document, acceptance or report required or permitted to be given by either party hereto to the other party shall be in writing and shall be deemed delivered when deposited in the United States mails, first class postage prepaid, or when delivered personally, or reputable air courier, addressed as follows: 
	
		
	If to the Company:
	American Railcar Leasing LLC
100 Clark Street, Suite 201
St. Charles, Missouri 63301

	 
	 

	If to the Consultant:
	American Railcar Industries, Inc.
100 Clark Street
St. Charles, Missouri 63301

11. Severability. 
If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon a determination that any term or provision is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to modify this Agreement to effect the original intent of the Parties as closely as possible in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.
12. Amendments. 
No amendment to or modification of or rescission, termination or discharge of this Agreement is effective unless it is in writing and signed by each Party.
13. Waiver. 
No waiver by any party of any of the provisions of this Agreement shall be effective unless explicitly set forth in writing and signed by the party so waiving. Except as otherwise set forth in this Agreement, no failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

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14. Successors and Assigns. 
This Agreement is binding on and inures to the benefit of the Parties to this Agreement and their respective permitted successors and permitted assigns. 
15. No Third-Party Beneficiaries. 
This Agreement benefits solely the Parties to this Agreement and their respective permitted successors and assigns and nothing in this Agreement, express or implied, confers on any other Person any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
16. GOVERNING LAW.
THIS AGREEMENT AND ALL RIGHTS AND OBLIGATIONS HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO CHOICE OF LAW PRINCIPLES) APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
17. CONSENT TO JURISDICTION.
ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE COMPANY OR THE ADMINISTRATOR ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY, MUST BE INSTITUTED ONLY IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, STATE OF NEW YORK AND ADMINISTRATOR AND COMPANY EACH WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING AND, SOLELY FOR THE PURPOSES OF ENFORCING THIS AGREEMENT, ADMINISTRATOR AND COMPANY EACH IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING. 
18. WAIVER OF JURY TRIAL. 
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, AS AGAINST THE OTHER PARTY HERETO, ANY RIGHTS IT MAY HAVE TO A JURY TRIAL IN RESPECT OF ANY CIVIL ACTION OR PROCEEDING (WHETHER ARISING IN CONTRACT OR TORT OR OTHERWISE), INCLUDING ANY COUNTERCLAIM, ARISING UNDER OR RELATING TO THIS AGREEMENT, INCLUDING IN RESPECT OF THE NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT HEREOF.
19. Headings. 
The descriptive headings of the several subsections and articles of this Agreement are inserted for convenience only and do not constitute part of this Agreement.

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20. No Strict Construction. 
The Parties to this Agreement have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties, and no presumption or burden of proof will arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.
21. Counterparts. 
This Agreement may be executed in counterparts, each of which is deemed an original, but all of which together are deemed to be one and the same agreement. Notwithstanding anything to the contrary in Section 9, a signed copy of this Agreement delivered by facsimile, email or other means of electronic transmission is deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
22. Force Majeure. 
Neither party hereto shall be deemed to be in breach or in violation of the Agreement if such Person is prevented from performing any of its obligations hereunder for any reason beyond its reasonable control, including acts of God, strikes, fires, storms, insurrections, public disturbances, natural disasters, embargoes, explosions, riots, wars, acts of terrorism or any regulation of any federal, state or local government or any agency thereof.
 
[SIGNATURE PAGE FOLLOWS]

    

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IN WITNESS WHEREOF, the Company and the Consultant have caused this Agreement to be duly executed and delivered on the date first above written.
	
	
	AMERICAN RAILCAR LEASING LLC
 
 

	By____________________________________
Name: John O’Bryan
Title: Chief Executive Officer

	
	
	AMERICAN RAILCAR INDUSTRIES, INC.
 
 

	By____________________________________
Name: Jeffrey S. Hollister
Title: President and Chief Executive Officer

 

[Signature Page to Consulting Services Agreement]

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