EXHIBIT 10.6
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
$300,000,000
TRINITY INDUSTRIES, INC.
6 1/2% Senior Notes due 2014
Purchase Agreement
March 5, 2004
▇.▇. ▇▇▇▇▇▇ Securities Inc.
As Representative of the
several Initial Purchasers listed
in Schedule 1 hereto
c/o ▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Trinity Industries, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to the several Initial Purchasers listed in Schedule
1 hereto (the "Initial Purchasers"), for whom you are acting as representative
(the "Representative"), $300,000,000 principal amount of its 6 1/2% Senior Notes
due 2014 (the "Securities"). The Securities will be issued pursuant to an
Indenture to be dated as of March 10, 2004 (the "Indenture") among the Company,
the guarantors listed in Schedule 2 hereto (the "Guarantors") and ▇▇▇▇▇ Fargo
Bank, National Association, as trustee (the "Trustee"), and will be guaranteed
on an unsecured senior basis by each of the Guarantors (the "Guarantees").
The Securities will be sold to the Initial Purchasers without being
registered under the Securities Act of 1933, as amended (the "Securities Act"),
in reliance upon an exemption therefrom. The Company has prepared a preliminary
offering memorandum dated February 26, 2004 (the "Preliminary Offering
Memorandum") and will prepare an offering memorandum dated the date hereof (the
"Offering Memorandum") setting forth information concerning the Company, the
Guarantors and the Securities. Copies of the Preliminary Offering Memorandum
have been, and copies of the Offering Memorandum will be, delivered by the
Company to the Initial Purchasers pursuant to the terms of this Agreement. The
Company hereby confirms that it has authorized the use of the Preliminary
Offering Memorandum and the Offering Memorandum in connection with the offering
and resale of the Securities by the Initial Purchasers in the manner
contemplated by this Agreement. Capitalized terms used but not
defined herein shall have the meanings given to such terms in the Offering
Memorandum. References herein to the Preliminary Offering Memorandum and the
Offering Memorandum shall be deemed to refer to and include any amendments and
supplements thereto and any document incorporated by reference therein.
Holders of the Securities (including the Initial Purchasers and their
direct and indirect transferees) will be entitled to the benefits of a
Registration Rights Agreement, to be dated the Closing Date (as defined below)
and substantially in the form attached hereto as Exhibit A (the "Registration
Rights Agreement"), pursuant to which the Company and the Guarantors will agree
to file one or more registration statements with the Securities and Exchange
Commission (the "Commission") providing for the registration under the
Securities Act of the Securities or the Exchange Securities referred to (and as
defined) in the Registration Rights Agreement.
Concurrently with the purchase and sale of the Securities, the Company
is amending and restating its existing $425.0 million senior secured credit
facilities (the "Existing Credit Facilities") to provide for a senior secured
revolving credit facility in an aggregate amount of $250.0 million (the "Amended
and Restated Credit Facilities"). The Amended and Restated Credit Facilities
will be guaranteed on a senior basis by each of the Guarantors and will be
secured by a lien on certain of the assets of the Company and its subsidiaries.
The Amended and Restated Credit Facilities will be governed by an agreement
dated as of the Closing Date by among the Company, the Guarantors, the lenders
party thereto, JPMorgan Chase Bank, as administrative agent, and Dresdner Bank
AG, New York, Grand Cayman Branches, and The Royal Bank of Scotland plc, as
syndication agents (together with the related documents thereto, including,
without limitation, any guarantee agreements and security documents, the
"Amended and Restated Credit Agreement" and, together with this Agreement, the
Securities, the Guarantees, the Exchange Securities (including the related
guarantees), the Indenture and the Registration Rights Agreement, the
"Transaction Documents").The Company hereby confirms its agreement with the
several Initial Purchasers concerning the purchase and resale of the Securities,
as follows:
1. Purchase and Resale of the Securities. (a) The Company agrees
to issue and sell the Securities to the several Initial Purchasers as provided
in this Agreement, and each Initial Purchaser, on the basis of the
representations, warranties and agreements set forth herein and subject to the
conditions set forth herein, agrees, severally and not jointly, to purchase from
the Company the respective principal amount of Securities set forth opposite
such Initial Purchaser's name in Schedule 1 hereto at a price equal to 98.25% of
the principal amount thereof plus accrued interest, if any, from March 10, 2004
to the Closing Date. The Company will not be obligated to deliver any of the
Securities except upon payment for all the Securities to be purchased as
provided herein.
(b) The Company understands that the Initial Purchasers intend to
offer the Securities for resale on the terms set forth in the Offering
Memorandum. Each Initial Purchaser, severally and not jointly, represents,
warrants and agrees that:
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(i) it is either (x) a qualified institutional buyer
within the meaning of Rule 144A under the Securities Act (a "QIB") and
an accredited investor within the meaning of Rule 501(a) under the
Securities Act or (y) not a U.S. person within the meaning of Rule
902(k) of Regulation S under the Securities Act ("Regulation S");
(ii) neither it nor and any of its affiliates referred to
in Section 1(d) below has solicited offers for, or offered or sold, or
will solicit offers for, or offer or sell, the Securities by means of
any form of general solicitation or general advertising within the
meaning of Rule 502(c) of Regulation D under the Securities Act
("Regulation D") or in any manner involving a public offering within
the meaning of Section 4(2) of the Securities Act; and
(iii) neither it nor and any of its affiliates referred to
in Section 1(d) below has solicited offers for, or offered or sold, or
will solicit offers for, or offer or sell, the Securities as part of
their initial offering except:
(A) within the United States to persons whom it
reasonably believes to be QIBs in transactions pursuant to
Rule 144A under the Securities Act ("Rule 144A") and in
connection with each such sale, it has taken or will take
reasonable steps to ensure that the purchaser of the
Securities is aware that such sale is being made in reliance
on Rule 144A; or
(B) in accordance with the restrictions set
forth in Annex A hereto.
(c) Each Initial Purchaser acknowledges and agrees that the
Company and, for purposes of the opinions to be delivered to the Initial
Purchasers pursuant to Sections 5(f) and 5(g), counsel for the Company and
counsel for the Initial Purchasers, respectively, may rely upon the accuracy of
the representations and warranties of the Initial Purchasers, and compliance by
the Initial Purchasers with their agreements, contained in paragraph (b) above
(including Annex A hereto), and each Initial Purchaser hereby consents to such
reliance.
(d) The Company acknowledges and agrees that the Initial
Purchasers may offer and sell Securities to or through any affiliate of an
Initial Purchaser and that any such affiliate may offer and sell Securities
purchased by it to or through any Initial Purchaser.
2. Payment and Delivery. (a) Payment for and delivery of the
Securities will be made at the offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP at 10:00
A.M., New York City time, on March 10, 2004, or at such other time or place on
the same or such other date, not later than the fifth business day thereafter,
as the Representative and the Company may agree upon in writing. The time and
date of such payment and delivery is referred to herein as the "Closing Date."
(b) Payment for the Securities shall be made by wire transfer in
immediately available funds to the account(s) specified by the Company to the
Representative against
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delivery to the nominee of The Depository Trust Company, for the account of the
Initial Purchasers, of one or more global notes representing the Securities
(collectively, the "Global Note"), with any transfer taxes payable in connection
with the sale of the Securities duly paid by the Company. The Global Note will
be made available for inspection by the Representative not later than 1:00 P.M.,
New York City time, on the business day prior to the Closing Date.
3. Representations and Warranties of the Company and the
Guarantors. The Company and the Guarantors jointly and severally represent and
warrant to each Initial Purchaser that:
(a) Offering Memorandum. The Preliminary Offering Memorandum, as
of its date, did not, and the Offering Memorandum, in the form first used by the
Initial Purchasers to confirm sales of the Securities and as of the Closing
Date, will not, contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided,
however, that the Company and the Guarantors make no representation or warranty
with respect to any statements or omissions made in reliance upon and in
conformity with information relating to any Initial Purchaser furnished to the
Company in writing by such Initial Purchaser through the Representative
expressly for use in the Preliminary Offering Memorandum or the Offering
Memorandum.
(b) Incorporated Documents. The documents incorporated by
reference in the Preliminary Offering Memorandum and the Offering Memorandum,
when filed with the Commission, conformed or will conform, as the case may be,
in all material respects to the requirements of the Exchange Act and the rules
and regulations of the Commission thereunder, and did not and will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(c) Financial Statements. The financial statements and the related
notes thereto included or incorporated by reference in the Preliminary Offering
Memorandum and the Offering Memorandum present fairly in all material respects
the financial position of the Company and its subsidiaries as of the dates
indicated and the results of their operations and the changes in their cash
flows for the periods specified; such financial statements have been prepared in
conformity with generally accepted accounting principles applied on a consistent
basis throughout the periods covered thereby; and the other financial
information included or incorporated by reference in the Preliminary Offering
Memorandum and the Offering Memorandum has been derived from the accounting
records of the Company and its subsidiaries and presents fairly the information
shown thereby.
(d) No Material Adverse Change. Since the date of the most recent
financial statements of the Company included or incorporated by reference in the
Preliminary Offering Memorandum and the Offering Memorandum, (i) there has not
been any change in the
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capital stock (other than pursuant to the exercise of stock options authorized
and issued on or prior to the date hereof) or long-term debt of the Company or
any of its subsidiaries, or any dividend or distribution of any kind declared,
set aside for payment, paid or made by the Company on any class of capital
stock, or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the business, properties,
management, financial position, results of operations or prospects of the
Company and its subsidiaries taken as a whole; (ii) neither the Company nor any
of its subsidiaries has entered into any transaction or agreement that is
material to the Company and its subsidiaries taken as a whole or incurred any
liability or obligation, direct or contingent, that is material to the Company
and its subsidiaries taken as a whole; and (iii) neither the Company nor any of
its subsidiaries has sustained any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not covered
by insurance, or from any labor disturbance or dispute or any action, order or
decree of any court or arbitrator or governmental or regulatory authority,
except with respect to clauses (i) through (iii), as otherwise disclosed in the
Preliminary Offering Memorandum and the Offering Memorandum.
(e) Organization and Good Standing. The Company and each of its
Significant Subsidiaries have been duly incorporated or otherwise organized and
are validly existing and in good standing under the laws of their respective
jurisdictions of organization, are duly qualified to do business and are in good
standing in each jurisdiction in which their respective ownership or lease of
property or the conduct of their respective businesses requires such
qualification, and have all power and authority necessary to own or hold their
respective properties and to conduct the businesses in which they are engaged,
except where the failure to be so qualified or have such power or authority
would not, individually or in the aggregate, have a material adverse effect on
the business, properties, management, financial position, results of operations
or prospects of the Company and its subsidiaries taken as a whole or on the
performance by the Company and the Guarantors of their obligations under the
Securities and the Guarantees (a "Material Adverse Effect"). As used herein
"Significant Subsidiary" means (x) each of the Guarantors, (y) each subsidiary
of the Company that is a "significant subsidiary" under Rule 1-02(w)(2) of
Regulation S-X under the Exchange Act (substituting five percent for 10 percent
in the test used therein) and (z) each of Trinity Rail Leasing I L.P., Trinity
Rail Leasing Trust II and Trinity Rail Leasing III L.P.; provided that each of
Administradora Especializada, S. de ▇.▇. de C.V., Grupo Tatsa, S. de ▇.▇. de
C.V., Trinity Industries de Mexico, S. de ▇.▇. de C.V. and Servicios
Corporativos Tatsa, S. de ▇.▇. de C.V. (collectively, the "Mexican
Subsidiaries") shall constitute Significant Subsidiaries as defined herein
solely for purposes of Sections 3(f), (s) and (t). The Company does not own or
control, directly or indirectly, any entity that is a "significant subsidiary"
under Rule 1-02(w)(2) of Regulation S-X under the Exchange Act (substituting
five percent for 10 percent in the test used therein) other than the Mexican
Subsidiaries and certain of the Guarantors.
(f) Capitalization. The Company has an authorized capitalization
as set forth in the Preliminary Offering Memorandum and the Offering Memorandum
under the heading "Capitalization"; and all the outstanding shares of capital
stock or other equity interests of each Significant Subsidiary of the Company
have been duly and validly authorized and issued, are
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fully paid and non-assessable (except, in the case of any foreign subsidiary,
for directors' qualifying shares) and are owned directly or indirectly by the
Company, free and clear of any lien, charge, encumbrance, security interest,
restriction on voting or transfer or any other claim of any third party other
than any liens, encumbrances and claims arising under the Amended and Restated
Credit Agreement.
(g) Due Authorization. The Company and each of the Guarantors have
full right, power and authority to execute and deliver each of the Transaction
Documents to the extent each is a party thereto and to perform their respective
obligations thereunder; and all action required to be taken for the due and
proper authorization, execution and delivery of each of the Transaction
Documents and the consummation of the transactions contemplated thereby has been
(or, in the case of the Amended and Restated Credit Agreement, will on the
Closing Date have been) duly and validly taken.
(h) The Indenture. The Indenture has been duly authorized by the
Company and each of the Guarantors and, when duly executed and delivered in
accordance with its terms by each of the parties thereto, will constitute a
valid and legally binding agreement of the Company and each of the Guarantors
enforceable against the Company and each of the Guarantors in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally or by equitable principles relating to enforceability (collectively,
the "Enforceability Exceptions"); and on the Closing Date, the Indenture will
conform in all material respects to the requirements of the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act"), and the rules and regulations
of the Commission applicable to an indenture that is qualified thereunder.
(i) The Securities and the Guarantees. The Securities have been
duly authorized by the Company and, when duly executed, authenticated, issued
and delivered as provided in the Indenture and paid for as provided herein, will
be duly and validly issued and outstanding and will constitute valid and legally
binding obligations of the Company enforceable against the Company in accordance
with their terms, subject to the Enforceability Exceptions, and will be entitled
to the benefits of the Indenture; and the Guarantees have been duly authorized
by each of the Guarantors and, when the Securities have been duly executed,
authenticated, issued and delivered as provided in the Indenture and paid for as
provided herein, will be valid and legally binding obligations of each of the
Guarantors, enforceable against each of the Guarantors in accordance with their
terms, subject to the Enforceability Exceptions, and will be entitled to the
benefits of the Indenture.
(j) The Exchange Securities. On the Closing Date, the Exchange
Securities (including the related guarantees) will have been duly authorized by
the Company and each of the Guarantors and, when duly executed, authenticated,
issued and delivered as contemplated by the Registration Rights Agreement, will
be duly and validly issued and outstanding and will constitute valid and legally
binding obligations of the Company, as issuer, and each of the Guarantors, as
guarantor, enforceable against the Company and each of the Guarantors
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in accordance with their terms, subject to the Enforceability Exceptions, and
will be entitled to the benefits of the Indenture.
(k) Purchase and Registration Rights Agreements. This Agreement
has been duly authorized, executed and delivered by the Company and each of the
Guarantors; and the Registration Rights Agreement has been duly authorized by
the Company and each of the Guarantors and, when duly executed and delivered in
accordance with its terms by each of the parties thereto, will constitute a
valid and legally binding agreement of the Company and each of the Guarantors
enforceable against the Company and each of the Guarantors in accordance with
its terms, subject to the Enforceability Exceptions, and except that rights to
indemnity and contribution thereunder may be limited by applicable law and
public policy.
(l) Amended and Restated Credit Agreement. As of the Closing Date,
the Amended and Restated Credit Agreement will have been duly authorized by the
Company and each of the Guarantors and, when duly executed and delivered in
accordance with its terms by each of the parties thereto, will constitute a
valid and legally binding agreement of the Company and each of the Guarantors
enforceable against the Company and each of the Guarantors in accordance with
its terms, subject to the Enforceability Exceptions.
(m) Descriptions of the Transaction Documents. Each Transaction
Document conforms in all material respects to the description thereof contained
in the Preliminary Offering Memorandum and the Offering Memorandum.
(n) No Violation or Default. Neither the Company nor any of its
Significant Subsidiaries is (i) in violation of its charter or by-laws or
similar organizational documents; (ii) in default, and no event has occurred
that, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained
in any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its Significant Subsidiaries is a
party or by which the Company or any of its Significant Subsidiaries is bound or
to which any of the property or assets of the Company or any of its Significant
Subsidiaries is subject; or (iii) in violation of any law or statute or any
judgment, order, rule or regulation of any court or arbitrator or governmental
or regulatory authority, except, in the case of clauses (ii) and (iii) above,
for any such default or violation that could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
(o) No Conflicts. The execution, delivery and performance by the
Company and each of the Guarantors of each of the Transaction Documents to which
each is a party, the issuance and sale of the Securities (including the
Guarantees) and compliance by the Company and each of the Guarantors with the
terms thereof and the consummation of the transactions contemplated by the
Transaction Documents will not (i) conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its Significant Subsidiaries
pursuant to, any indenture, mortgage,
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deed of trust, loan agreement or other agreement or instrument to which the
Company or any of its Significant Subsidiaries is a party or by which the
Company or any of its significant subsidiaries is bound or to which any of the
property or assets of the Company or any of its Significant Subsidiaries is
subject (other than liens arising under the Amended and Restated Credit
Agreement), (ii) result in any violation of the provisions of the charter or
by-laws or similar organizational documents of the Company or any of the
Guarantors or (iii) result in the violation of any law or statute or any
judgment, order, rule or regulation of any court or arbitrator or governmental
or regulatory authority, except, in the case of clauses (i) and (iii) above, for
any such conflict, breach or violation that could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
(p) No Consents Required. No consent, approval, authorization,
order, registration or qualification of or with any court or arbitrator or
governmental or regulatory authority is required for the execution, delivery and
performance by the Company and each of the Guarantors of each of the Transaction
Documents to which each is a party, the issuance and sale of the Securities
(including the Guarantees) and compliance by the Company and each of the
Guarantors with the terms thereof and the consummation of the transactions
contemplated by the Transaction Documents, except for such consents, approvals,
authorizations, orders and registrations or qualifications as may be required
(i) under applicable state securities laws in connection with the purchase and
resale of the Securities by the Initial Purchasers and (ii) with respect to the
Exchange Securities (including the related guarantees) or the sale of
Registrable Securities pursuant to a Shelf Registration Statement (each as
defined in the Registration Rights Agreement) under the Securities Act, the
Trust Indenture Act and applicable state securities laws as contemplated by the
Registration Rights Agreement.
(q) Legal Proceedings. Except as described in the Preliminary
Offering Memorandum and the Offering Memorandum, there are no legal,
governmental or regulatory investigations, actions, suits or proceedings pending
to which the Company or any of its subsidiaries is or may be a party or to which
any property of the Company or any of its subsidiaries is or may be the subject
that, individually or in the aggregate, if determined adversely to the Company
or any of its subsidiaries, could reasonably be expected to have a Material
Adverse Effect; and to the best knowledge of the Company and each of the
Guarantors, no such investigations, actions, suits or proceedings are threatened
or contemplated by any governmental or regulatory authority or by others.
(r) Independent Accountants. Ernst & Young LLP, who have certified
certain financial statements of the Company and its subsidiaries are independent
public accountants with respect to the Company and its subsidiaries within the
meaning of Rule 101 of the Code of Professional Conduct of the American
Institute of Certified Public Accountants and its interpretations and rulings
thereunder.
(s) Title to Real and Personal Property. The Company and its
Significant Subsidiaries have good and marketable title in fee simple to, or
have valid rights to lease or otherwise use, all items of real and personal
property that are material to the respective busi-
8
nesses of the Company and its Significant Subsidiaries, in each case free and
clear of all liens, encumbrances, claims and defects and imperfections of title
except those that (i) do not materially interfere with the use made and proposed
to be made of such property by the Company and its Significant Subsidiaries,
(ii) could not reasonably be expected, individually or in the aggregate, to have
a Material Adverse Effect or (iii) exist under the Existing Credit Agreement.
(t) Title to Intellectual Property. The Company and its
Significant Subsidiaries own or possess adequate rights to use all material
patents, patent applications, trademarks, service marks, trade names, trademark
registrations, service ▇▇▇▇ registrations, copyrights, licenses and know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) necessary for the conduct of
their respective businesses; and the conduct of their respective businesses will
not conflict in any material respect with any such rights of others, and the
Company and its Significant Subsidiaries have not received any notice of any
claim of infringement of or conflict with any such rights of others except for
such conflicts and claims as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(u) Investment Company Act. Neither the Company nor any of the
Guarantors is, and after giving effect to the offering and sale of the
Securities and the application of the proceeds thereof as described in the
Offering Memorandum none of them will be, an "investment company" or an entity
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, and the rules and regulations of the Commission
thereunder (collectively, the "Investment Company Act").
(v) Public Utility Holding Company Act. Neither the Company nor
any of the Significant Subsidiaries is a "holding company" or a "subsidiary
company" of a holding company or an "affiliate" thereof within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
(w) Taxes. The Company and its subsidiaries have paid all federal,
state, local and foreign taxes and filed all tax returns required to be paid or
filed through the date hereof; and except as otherwise disclosed in the
Preliminary Offering Memorandum and the Offering Memorandum, there is no tax
deficiency that has been, or could reasonably be expected to be, asserted
against the Company or any of its subsidiaries or any of their respective
properties or assets, except for such failures to pay such taxes, file such tax
returns or deficiencies as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(x) Licenses and Permits. The Company and its Significant
Subsidiaries possess all licenses, certificates, permits and other
authorizations issued by, and have made all declarations and filings with, the
appropriate federal, state, local or foreign governmental or regulatory
authorities that are necessary for the ownership or lease of their respective
properties or the conduct of their respective businesses as described in the
Preliminary Offering Memo-
9
randum and the Offering Memorandum, except where the failure to possess or make
the same could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect; and except as described in the Preliminary
Offering Memorandum and the Offering Memorandum, neither the Company nor any of
its Significant Subsidiaries has received written notice of any revocation or
modification of any such license, certificate, permit or authorization or has
any reason to believe that any such license, certificate, permit or
authorization will not be renewed in the ordinary course.
(y) No Labor Disputes. No labor disturbance by or dispute with
employees of the Company or any of its subsidiaries exists or, to the best
knowledge of the Company and each of the Guarantors, is contemplated or
threatened except for such disturbances and disputes as could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(z) Compliance With Environmental Laws. The Company and its
subsidiaries (i) are in compliance with any and all applicable federal, state,
local and foreign laws, rules, regulations, decisions and orders relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (collectively, "Environmental
Laws"); (ii) have received and are in compliance with all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective businesses; and (iii) have not received notice of any actual or
potential liability for the investigation or remediation of any disposal or
release of hazardous or toxic substances or wastes, pollutants or contaminants,
except in any such case for any such failure to comply with, or failure to
receive required permits, licenses or approvals, or liability, as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(aa) Compliance With ERISA. (1) Each employee benefit plan, within
the meaning of Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), that is maintained, administered or contributed to
by the Company or any of its affiliates for employees or former employees of the
Company and its affiliates has been maintained in all material respects in
compliance with its terms and the requirements of any applicable statutes,
orders, rules and regulations, including but not limited to ERISA and the
Internal Revenue Code of 1986, as amended (the "Code"); (2) no prohibited
transaction, within the meaning of Section 406 of ERISA or Section 4975 of the
Code, has occurred with respect to any such plan excluding transactions effected
pursuant to a statutory or administrative exemption; and (3) for each such plan
that is subject to the funding rules of Section 412 of the Code or Section 302
of ERISA, no "accumulated funding deficiency" as defined in Section 412 of the
Code has been incurred, whether or not waived, and the fair market value of the
assets of each such plan (excluding for these purposes accrued but unpaid
contributions) exceeds the present value of all benefits accrued under such plan
determined using reasonable actuarial assumptions; except, in the case of
clauses (2) and (3), for such transactions or deficiencies as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
10
(bb) Accounting Controls. The Company and its subsidiaries maintain
systems of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(cc) Disclosure Controls. The Company has established and maintains
disclosure controls and procedures (as such term is defined in Rules 13a-15 and
15d-15 under the Exchange Act); such disclosure controls and procedures are
designed to ensure that material information relating to the Company and the
Subsidiaries is made known to the chief executive officer and chief financial
officer of the Company by others within the Company or any of its subsidiaries,
and such disclosure controls and procedures are reasonably effective to perform
the functions for which they were established subject to the limitations of any
such control system; the Company's auditors and the audit committee of the board
of directors of the Company have been advised of: (1) any significant
deficiencies in the design or operation of internal controls which could
adversely affect the Company's ability to record, process, summarize, and report
financial data; and (2) any fraud, whether or not material, that involves
management or other employees who have a role in the Company's internal
controls; any material weaknesses in internal controls have been identified for
the Company's auditors; since the date of the most recent evaluation of such
disclosure controls and procedures, there have been no significant changes in
internal controls or in other factors that could significantly affect internal
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses; the Company has provided or made available
to the Initial Purchasers or their counsel true and complete copies of all
extant minutes or draft minutes of meetings, or resolutions adopted by written
consent, of the board of directors of the Company and each of its subsidiaries
and each committee of each such board in the past three years, and all agendas
for each such meeting for which minutes or draft minutes do not exist.
(dd) Sarbanes Oxley Act Compliance. There is and has been no
failure on the part of the Company or any of the Company's directors or
officers, in their capacities as such, to comply with any provision of the
Sarbanes Oxley Act of 2002 and the rules and regulations promulgated in
connection therewith, including Section 402 related to loans and Sections 302
and 906 related to certifications.
(ee) Insurance. The Company and its Significant Subsidiaries have
insurance covering their respective properties, operations, personnel and
businesses, including business interruption insurance, which insurance is in
amounts and insures against such losses and risks as the Company believes are
prudent and customary in its and its Significant Subsidiaries' respective
businesses; and neither the Company nor any of its Significant Subsidiaries has
(i) received written notice from any insurer or agent of such insurer that
capital improvements or
11
other expenditures are required or necessary to be made in order to continue
such insurance or (ii) any reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage expires or to obtain
similar coverage at reasonable cost from similar insurers as may be necessary to
continue its business.
(ff) No Unlawful Payments. Neither the Company nor any of its
subsidiaries nor, to the best knowledge of the Company and each of the
Guarantors, any director, officer, agent, employee or other person associated
with or acting on behalf of the Company or any of its subsidiaries has (i) used
any corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expense relating to political activity; (ii) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; (iii) violated or is in violation of any
provision of the Foreign Corrupt Practices Act of 1977; or (iv) made any bribe,
rebate, payoff, influence payment, kickback or other unlawful payment.
(gg) Solvency. On and immediately after the Closing Date, the
Company (after giving effect to the issuance of the Securities and the other
transactions related thereto as described in the Offering Memorandum and on a
consolidated basis) will be Solvent. As used in this paragraph, the term
"Solvent" means, with respect to a particular date, that on such date (i) the
present fair market value (or present fair saleable value) of the assets of the
Company is not less than the total amount required to pay the liabilities of the
Company on its total existing debts and liabilities (including contingent
liabilities) as they become absolute and matured; (ii) the Company is able to
realize upon its assets and pay its debts and other liabilities, contingent
obligations and commitments as they mature and become due in the normal course
of business; (iii) assuming consummation of the issuance of the Securities as
contemplated by this Agreement and the Offering Memorandum, the Company is not
incurring debts or liabilities beyond its ability to pay as such debts and
liabilities mature; (iv) the Company is not engaged in any business or
transaction, and does not propose to engage in any business or transaction, for
which its property would constitute unreasonably small capital after giving due
consideration to the prevailing practice in the industry in which the Company is
engaged; and (v) the Company is not a defendant in any civil action that would
result in a judgment that the Company is or would become unable to satisfy.
(hh) No Restrictions on Subsidiaries. No subsidiary of the Company
is currently prohibited, directly or indirectly, under any agreement or other
instrument to which it is a party or is subject, from paying any dividends to
the Company, from making any other distribution on such subsidiary's capital
stock, from repaying to the Company any loans or advances to such subsidiary
from the Company or from transferring any of such subsidiary's properties or
assets to the Company or any other subsidiary of the Company other than such
restrictions on Trinity Rail Leasing Trust II, Trinity Rail Leasing I L.P. and
Trinity Rail Leasing III L.P.
(ii) No Broker's Fees. Neither the Company nor any of its
Significant Subsidiaries is a party to any contract, agreement or understanding
with any person (other than this Agreement) that would
12
give rise to a valid claim against any of them or any Initial Purchaser for a
brokerage commission, finder's fee or like payment in connection with the
offering and sale of the Securities.
(jj) Rule 144A Eligibility. On the Closing Date, the Securities
will not be of the same class as securities listed on a national securities
exchange registered under Section 6 of the Exchange Act or quoted in an
automated inter-dealer quotation system; and each of the Preliminary Offering
Memorandum and the Offering Memorandum, as of its respective date, contains or
will contain all the information that, if requested by a prospective purchaser
of the Securities, would be required to be provided to such prospective
purchaser pursuant to Rule 144A(d)(4) under the Securities Act.
(kk) No Integration. Neither the Company nor any of its affiliates
(as defined in Rule 501(b) of Regulation D) has, directly or through any agent,
sold, offered for sale, solicited offers to buy or otherwise negotiated in
respect of, any security (as defined in the Securities Act), that is or will be
integrated with the sale of the Securities in a manner that would require
registration of the Securities under the Securities Act.
(ll) No General Solicitation or Directed Selling Efforts. None of
the Company or any of its affiliates or any other person acting on its or their
behalf (other than the Initial Purchasers, as to which no representation is
made) has (i) solicited offers for, or offered or sold, the Securities by means
of any form of general solicitation or general advertising within the meaning of
Rule 502(c) of Regulation D or in any manner involving a public offering within
the meaning of Section 4(2) of the Securities Act or (ii) engaged in any
directed selling efforts within the meaning of Regulation S, and all such
persons have complied with the offering restrictions requirement of Regulation
S.
(mm) Securities Law Exemptions. Assuming the accuracy of the
representations and warranties of the Initial Purchasers contained in Section
1(b) (including Annex A hereto) and their compliance with their agreements set
forth therein, it is not necessary, in connection with the issuance and sale of
the Securities to the Initial Purchasers and the offer, resale and delivery of
the Securities by the Initial Purchasers in the manner contemplated by this
Agreement and the Offering Memorandum, to register the Securities under the
Securities Act or to qualify the Indenture under the Trust Indenture Act.
(nn) No Stabilization. Neither the Company nor any of the
Guarantors has taken, directly or indirectly, any action designed to or that
could reasonably be expected to cause or result in any stabilization or
manipulation of the price of the Securities.
(oo) Margin Rules. Neither the issuance, sale and delivery of the
Securities nor the application of the proceeds thereof by the Company as
described in the Offering Memorandum will violate Regulation T, U or X of the
Board of Governors of the Federal Reserve System or any other regulation of such
Board of Governors.
13
(pp) Forward-Looking Statements. No forward-looking statement
(within the meaning of Section 27A of the Securities Act and Section 21E of the
Exchange Act) contained in the Preliminary Offering Memorandum and the Offering
Memorandum has been made or reaffirmed without a reasonable basis or has been
disclosed other than in good faith.
(qq) Statistical and Market Data. Nothing has come to the attention
of the Company that has caused the Company or any of the Guarantors to believe
that the statistical and market-related data included or incorporated by
reference in the Preliminary Offering Memorandum and the Offering Memorandum is
not based on or derived from sources that are reliable and accurate in all
material respects.
4. Further Agreements of the Company and the Guarantors. The
Company and each of the Guarantors jointly and severally covenant and agree with
each Initial Purchaser that:
(a) Delivery of Copies. The Company will deliver to the Initial
Purchasers as many copies of the Preliminary Offering Memorandum and the
Offering Memorandum (including all amendments and supplements thereto) as the
Representative may reasonably request.
(b) Amendments or Supplements. Before making or distributing any
amendment or supplement to the Preliminary Offering Memorandum or the Offering
Memorandum or filing with the Commission any document that will be incorporated
by reference therein, the Company will furnish to the Representative and counsel
for the Initial Purchasers a copy of the proposed amendment or supplement or
document to be incorporated by reference therein for review, and will not
distribute any such proposed amendment or supplement or file any such document
with the Commission to which the Representative reasonably objects.
(c) Notice to the Representative. The Company will advise the
Representative promptly, and confirm such advice in writing, (i) of the issuance
by any governmental or regulatory authority of any order preventing or
suspending the use of the Preliminary Offering Memorandum or the Offering
Memorandum or the initiation or threatening of any proceeding for that purpose;
(ii) of the occurrence of any event at any time prior to the completion of the
initial offering of the Securities as a result of which the Offering Memorandum
as then amended or supplemented would include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing when the Offering Memorandum
is delivered to a purchaser, not misleading; and (iii) of the receipt by the
Company of any notice with respect to any suspension of the qualification of the
Securities for offer and sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and the Company will use its
reasonable best efforts to prevent the issuance of any such order preventing or
suspending the use of the Preliminary Offering Memorandum or the Offering
Memorandum or suspending any such qualification of the Securities and, if any
such order is issued, will use its reasonable best efforts to obtain as soon as
possible the withdrawal thereof.
14
(d) Ongoing Compliance of the Offering Memorandum. If at any time
prior to the completion of the initial offering of the Securities (i) any event
shall occur or condition shall exist as a result of which the Offering
Memorandum as then amended or supplemented would include any untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances existing when the
Offering Memorandum is delivered to a purchaser, not misleading or (ii) it is
necessary to amend or supplement the Offering Memorandum to comply with law, the
Company will immediately notify the Initial Purchasers thereof and forthwith
prepare and, subject to paragraph (b) above, furnish to the Initial Purchasers
such amendments or supplements to the Offering Memorandum (or any document to be
filed with the Commission and incorporated by reference therein) as may be
necessary so that the statements in the Offering Memorandum as so amended or
supplemented (or including such document to be incorporated by reference
therein) will not, in the light of the circumstances existing when the Offering
Memorandum is delivered to a purchaser, be misleading or so that the Offering
Memorandum will comply with law.
(e) Blue Sky Compliance. The Company will qualify the Securities
for offer and sale under the securities or Blue Sky laws of such jurisdictions
as the Representative shall reasonably request and will continue such
qualifications in effect so long as required for the offering and resale of the
Securities; provided, however, that neither the Company nor any of the
Guarantors shall be required to (i) qualify as a foreign corporation or other
entity or as a dealer in securities in any such jurisdiction where it would not
otherwise be required to so qualify, (ii) file any general consent to service of
process in any such jurisdiction or (iii) subject itself to taxation in any such
jurisdiction if it is not otherwise so subject.
(f) Clear Market. During the period from the date hereof through
and including the date that is 90 days after the date hereof, the Company and
each of the Guarantors will not, without the prior written consent of ▇.▇.
▇▇▇▇▇▇ Securities Inc. and Credit Suisse First Boston LLC, offer, sell, contract
to sell or otherwise dispose of any debt securities issued or guaranteed by the
Company or any of the Guarantors and having a tenor of more than one year.
(g) Use of Proceeds. The Company will apply the net proceeds from
the sale of the Securities as described in the Offering Memorandum under the
heading "Use of Proceeds."
(h) Supplying Information. While the Securities remain outstanding
and are "restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act, the Company and each of the Guarantors will, during any period
in which the Company is not subject to and in compliance with Section 13 or
15(d) of the Exchange Act, furnish to holders of the Securities and prospective
purchasers of the Securities designated by such holders, upon the request of
such holders or such prospective purchasers, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
15
(i) PORTAL and DTC. The Company will assist the Initial Purchasers
in arranging for the Securities to be designated Private Offerings, Resales and
Trading through Automated Linkages ("PORTAL") Market securities in accordance
with the rules and regulations adopted by the National Association of Securities
Dealers, Inc. (the "NASD") relating to trading in the PORTAL Market and for the
Securities to be eligible for clearance and settlement through The Depository
Trust Company ("DTC").
(j) No Resales by the Company. Until the issuance of the Exchange
Securities, the Company will not, and will not permit any of its affiliates (as
defined in Rule 144 under the Securities Act) to, resell any of the Securities
that have been acquired by any of them, except for Securities purchased by the
Company or any of its affiliates and resold in a transaction registered under
the Securities Act.
(k) No Integration. Neither the Company nor any of its affiliates
(as defined in Rule 501(b) of Regulation D) will, directly or through any agent,
sell, offer for sale, solicit offers to buy or otherwise negotiate in respect
of, any security (as defined in the Securities Act), that is or will be
integrated with the sale of the Securities in a manner that would require
registration of the Securities under the Securities Act.
(l) No General Solicitation or Directed Selling Efforts. None of
the Company or any of its affiliates or any other person acting on its or their
behalf (other than the Initial Purchasers, as to which no covenant is given)
will (i) solicit offers for, or offer or sell, the Securities by means of any
form of general solicitation or general advertising within the meaning of Rule
502(c) of Regulation D or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act or (ii) engage in any directed
selling efforts within the meaning of Regulation S, and all such persons will
comply with the offering restrictions requirement of Regulation S.
(m) No Stabilization. Neither the Company nor any of the
Guarantors will take, directly or indirectly, any action designed to or that
could reasonably be expected to cause or result in any stabilization or
manipulation of the price of the Securities.
5. Conditions of Initial Purchasers' Obligations. The obligation
of each Initial Purchaser to purchase Securities on the Closing Date as provided
herein is subject to the performance by the Company and each of the Guarantors
of their respective covenants and other obligations hereunder and to the
following additional conditions:
(a) Representations and Warranties. The representations and
warranties of the Company and the Guarantors contained herein shall be true and
correct on the date hereof and on and as of the Closing Date; and the statements
of the Company, the Guarantors and their respective officers made in any
certificates delivered pursuant to this Agreement shall be true and correct on
and as of the Closing Date.
16
(b) No Downgrade. Subsequent to the execution and delivery of this
Agreement, (i) no downgrading shall have occurred in the rating accorded the
Securities or any other debt securities issued or guaranteed by the Company or
any of the Guarantors by any "nationally recognized statistical rating
organization", as such term is defined by the Commission for purposes of Rule
436(g)(2) under the Securities Act; and (ii) no such organization shall have
publicly announced that it has under surveillance or review, or has changed its
outlook with respect to, its rating of the Securities or of any other debt
securities issued or guaranteed by the Company or any of the Guarantors (other
than an announcement with positive implications of a possible upgrading).
(c) No Material Adverse Change. Subsequent to the execution and
delivery of this Agreement, no event or condition of a type described in Section
3(d) hereof shall have occurred or shall exist, which event or condition is not
described in the Offering Memorandum (excluding any amendment or supplement
thereto or any document filed with the Commission after the date hereof and
incorporated by reference therein) and the effect of which in the judgment of
the Representative makes it impracticable or inadvisable to proceed with the
offering, sale or delivery of the Securities on the terms and in the manner
contemplated by this Agreement and the Offering Memorandum.
(d) Officer's Certificate. The Representative shall have received
on and as of the Closing Date a certificate of an executive officer of the
Company and of each Guarantor who has specific knowledge of the Company's or
such Guarantor's financial matters and is reasonably satisfactory to the
Representative (i) confirming that such officer has carefully reviewed the
Offering Memorandum and, to the knowledge of such officer, the representation
set forth in Section 3(a) hereof is true and correct, (ii) confirming that the
other representations and warranties of the Company and the Guarantors in this
Agreement are true and correct and that the Company and the Guarantors have
complied with all agreements and satisfied all conditions on their part to be
performed or satisfied hereunder at or prior to the Closing Date and (iii) to
the effect set forth in paragraphs (b) and (c) above.
(e) Comfort Letters. On the date of this Agreement and on the
Closing Date, Ernst & Young, LLP shall have furnished to the Representative, at
the request of the Company, letters, dated the respective dates of delivery
thereof and addressed to the Initial Purchasers, in form and substance
reasonably satisfactory to the Representative, containing statements and
information of the type customarily included in accountants' "comfort letters"
to underwriters with respect to the financial statements and certain financial
information contained in the Preliminary Offering Memorandum and the Offering
Memorandum; provided, however, that the letter delivered on the Closing Date
shall use a "cut-off" date no more than three business days prior to the Closing
Date.
(f) Opinion of Counsel for the Company. (1) ▇▇▇▇▇▇ and ▇▇▇▇▇, LLP,
counsel for the Company, shall have furnished to the Representative, at the
request of the Company, their written opinion, dated the Closing Date and
addressed to the Initial Purchasers, in form and substance reasonably
satisfactory to the Representative, to the effect set forth in Annex
17
B hereto; and (2) ▇▇▇▇▇ Rice, Vice President of Legal Affairs of the Company,
shall have furnished to the Representative, at the request of the Company, his
written opinion, dated the Closing Date and addressed to the Initial Purchasers,
in form and substance reasonably satisfactory to the Representative, to the
effect set forth in Annex C hereto.
(g) Opinion of Counsel for the Initial Purchasers. The
Representative shall have received on and as of the Closing Date an opinion of
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the Initial Purchasers, with respect to
such matters as the Representative may reasonably request, and such counsel
shall have received such documents and information as they may reasonably
request to enable them to pass upon such matters.
(h) No Legal Impediment to Issuance. No action shall have been
taken and no statute, rule, regulation or order shall have been enacted, adopted
or issued by any federal, state or foreign governmental or regulatory authority
that would, as of the Closing Date, prevent the issuance or sale of the
Securities or the issuance of the Guarantees; and no injunction or order of any
federal, state or foreign court shall have been issued that would, as of the
Closing Date, prevent the issuance or sale of the Securities or the issuance of
the Guarantees.
(i) Good Standing. The Representative shall have received on and
as of the Closing Date satisfactory evidence of the good standing of the Company
and the Guarantors in their respective jurisdictions of organization and their
good standing in such other jurisdictions as the Representative may reasonably
request, in each case in writing or any standard form of telecommunication, from
the appropriate governmental authorities of such jurisdictions.
(j) Registration Rights Agreement. The Initial Purchasers shall
have received a counterpart of the Registration Rights Agreement that shall have
been executed and delivered by a duly authorized officer of the Company and each
of the Guarantors.
(k) Amended and Restated Credit Agreement. Each of the Company and
the Guarantors shall have executed and delivered the Amended and Restated Credit
Agreement the Initial Purchasers shall have received executed copies thereof, in
form and substance reasonably satisfactory to the Initial Purchasers and counsel
to the Initial Purchasers.
(l) PORTAL and DTC. The Securities shall have been approved by the
NASD for trading in the PORTAL Market and shall be eligible for clearance and
settlement through DTC.
(m) Additional Documents. On or prior to the Closing Date, the
Company and the Guarantors shall have furnished to the Representative such
further certificates and documents as the Representative may reasonably request.
18
All opinions, letters, certificates and evidence mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Initial Purchasers.
6. Indemnification and Contribution.
(a) Indemnification of the Initial Purchasers. The Company and
each of the Guarantors jointly and severally agree to indemnify and hold
harmless each Initial Purchaser, its affiliates, directors and officers and each
person, if any, who controls such Initial Purchaser within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages and liabilities (including, without
limitation, legal fees and other expenses incurred in connection with any suit,
action or proceeding or any claim asserted, as such fees and expenses are
incurred), joint or several, that arise out of, or are based upon, any untrue
statement or alleged untrue statement of a material fact contained in the
Preliminary Offering Memorandum or the Offering Memorandum (or any amendment or
supplement thereto) or any omission or alleged omission to state therein a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except insofar as
such losses, claims, damages or liabilities arise out of, or are based upon, any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with any information relating to any Initial
Purchaser furnished to the Company in writing by such Initial Purchaser through
the Representative expressly for use therein; provided, however, that with
respect to any such untrue statement in or omission from the Preliminary
Offering Memorandum, the indemnity agreement contained in this paragraph (a)
shall not inure to the benefit of any Initial Purchaser to the extent that the
sale to the person asserting any such loss, claim, damage or liability was an
initial resale by such Initial Purchaser and any such loss, claim, damage or
liability of or with respect to such Initial Purchaser results from the fact
that both (i) a copy of the Offering Memorandum (excluding any documents
incorporated by reference therein) was not sent or given to such person at or
prior to the written confirmation of the sale of such Securities to such person
and (ii) the untrue statement in or omission from such Preliminary Offering
Memorandum was corrected in the Offering Memorandum unless, in either case, such
failure to deliver the Offering Memorandum was a result of non-compliance by the
Company with the provisions of Section 4 hereof.
(b) Indemnification of the Company. Each Initial Purchaser agrees,
severally and not jointly, to indemnify and hold harmless the Company, each of
the Guarantors, their respective directors, officers and each person, if any,
who controls the Company or any of the Guarantors within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act to the same extent as
the indemnity set forth in paragraph (a) above, but only with respect to any
losses, claims, damages or liabilities that arise out of, or are based upon, any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with any information relating to such Initial
Purchaser furnished to the Company in writing by such Initial Purchaser through
the Representative expressly for use in the Preliminary Offering Memorandum and
the Offering Memorandum (or any amendment or
19
supplement thereto), it being understood and agreed that the only such
information consists of the following: the information contained in the third
paragraph, the fifth and sixth sentences of the eighth paragraph, and the tenth
paragraph under the heading "Plan of Distribution."
(c) Notice and Procedures. If any suit, action, proceeding
(including any governmental or regulatory investigation), claim or demand shall
be brought or asserted against any person in respect of which indemnification
may be sought pursuant to either paragraph (a) or (b) above, such person (the
"Indemnified Person") shall promptly notify the person against whom such
indemnification may be sought (the "Indemnifying Person") in writing; provided,
however, that the failure to notify the Indemnifying Person shall not relieve it
from any liability that it may have under this Section 6 except to the extent
that it has been materially prejudiced (through the forfeiture of substantive
rights or defenses) by such failure; and provided further, however, that the
failure to notify the Indemnifying Person shall not relieve it from any
liability that it may have to an Indemnified Person otherwise than under this
Section 6. If any such proceeding shall be brought or asserted against an
Indemnified Person and it shall have notified the Indemnifying Person thereof,
the Indemnifying Person shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others entitled
to indemnification pursuant to this Section 6 that the Indemnifying Person may
designate in such proceeding and shall pay the fees and expenses of such counsel
related to such proceeding, as incurred. In any such proceeding, any Indemnified
Person shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Person unless (i)
the Indemnifying Person and the Indemnified Person shall have mutually agreed to
the contrary; (ii) the Indemnifying Person has failed within a reasonable time
to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the
Indemnified Person shall have reasonably concluded that there may be legal
defenses available to it that are different from or in addition to those
available to the Indemnifying Person; or (iv) the named parties in any such
proceeding (including any impleaded parties) include both the Indemnifying
Person and the Indemnified Person and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests
between them. It is understood and agreed that the Indemnifying Person shall
not, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all
such fees and expenses shall be reimbursed as they are incurred. Any such
separate firm for any Initial Purchaser, its affiliates, directors and officers
and any control persons of such Initial Purchaser shall be designated in writing
by ▇.▇. ▇▇▇▇▇▇ Securities Inc. and any such separate firm for the Company, the
Guarantors and any control persons of the Company and the Guarantors shall be
designated in writing by the Company. The Indemnifying Person shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified
Person from and against any loss or liability by reason of such settlement or
judgment. Notwithstanding the foregoing sentence, if at any time an Indemnified
Person shall have requested that an Indemnifying Person reimburse the
Indemnified Person for fees and ex-
20
penses of counsel as contemplated by this paragraph, the Indemnifying Person
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after
receipt by the Indemnifying Person of such request and (ii) the Indemnifying
Person shall not have reimbursed the Indemnified Person in accordance with such
request prior to the date of such settlement. No Indemnifying Person shall,
without the written consent of the Indemnified Person, effect any settlement of
any pending or threatened proceeding in respect of which any Indemnified Person
is or could have been a party and indemnification could have been sought
hereunder by such Indemnified Person, unless such settlement (x) includes an
unconditional release of such Indemnified Person, in form and substance
reasonably satisfactory to such Indemnified Person, from all liability on claims
that are the subject matter of such proceeding and (y) does not include any
statement as to or any admission of fault, culpability or a failure to act by or
on behalf of any Indemnified Person.
(d) Contribution. If the indemnification provided for in
paragraphs (a) and (b) above is unavailable to an Indemnified Person or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then each Indemnifying Person under such paragraph, in lieu of
indemnifying such Indemnified Person thereunder, shall contribute to the amount
paid or payable by such Indemnified Person as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Guarantors on the one hand and
the Initial Purchasers on the other from the offering of the Securities or (ii)
if the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) but also the relative fault of the Company and the
Guarantors on the one hand and the Initial Purchasers on the other in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Guarantors on the one hand and
the Initial Purchasers on the other shall be deemed to be in the same respective
proportions as the net proceeds (before deducting expenses) received by the
Company from the sale of the Securities and the total discounts and commissions
received by the Initial Purchasers in connection therewith, as provided in this
Agreement, bear to the aggregate offering price of the Securities. The relative
fault of the Company and the Guarantors on the one hand and the Initial
Purchasers on the other shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or any Guarantor or by the Initial Purchasers and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(e) Limitation on Liability. The Company, the Guarantors and the
Initial Purchasers agree that it would not be just and equitable if contribution
pursuant to this Section 6 were determined by pro rata allocation (even if the
Initial Purchasers were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the equitable considerations
referred to in paragraph (d) above. The amount paid or payable by
21
an Indemnified Person as a result of the losses, claims, damages and liabilities
referred to in paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
Indemnified Person in connection with any such action or claim. Notwithstanding
the provisions of this Section 6, in no event shall an Initial Purchaser be
required to contribute any amount in excess of the amount by which the total
discounts and commissions received by such Initial Purchaser with respect to the
offering of the Securities exceeds the amount of any damages that such Initial
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Initial Purchasers' obligations to contribute
pursuant to this Section 6 are several in proportion to their respective
purchase obligations hereunder and not joint.
(f) Non-Exclusive Remedies. The remedies provided for in this
Section 6 are not exclusive and shall not limit any rights or remedies that may
otherwise be available to any Indemnified Person at law or in equity.
7. Termination. This Agreement may be terminated in the absolute
discretion of the Representative, by notice to the Company, if after the
execution and delivery of this Agreement and prior to the Closing Date (i)
trading generally shall have been suspended or materially limited on the New
York Stock Exchange or the over-the-counter market; (ii) trading of any
securities issued or guaranteed by the Company or any of the Guarantors shall
have been suspended on any exchange or in any over-the-counter market; (iii) a
general moratorium on commercial banking activities shall have been declared by
federal or New York State authorities; or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis, either within or outside the United States, that, in the
judgment of the Representative, is material and adverse and makes it
impracticable or inadvisable to proceed with the offering, sale or delivery of
the Securities on the terms and in the manner contemplated by this Agreement and
the Offering Memorandum.
8. Defaulting Initial Purchaser. (a) If, on the Closing Date, any
Initial Purchaser defaults on its obligation to purchase the Securities that it
has agreed to purchase hereunder, the non-defaulting Initial Purchasers may in
their discretion arrange for the purchase of such Securities by other persons
satisfactory to the Company on the terms contained in this Agreement. If, within
36 hours after any such default by any Initial Purchaser, the non-defaulting
Initial Purchasers do not arrange for the purchase of such Securities, then the
Company shall be entitled to a further period of 36 hours within which to
procure other persons satisfactory to the non-defaulting Initial Purchasers to
purchase such Securities on such terms. If other persons become obligated or
agree to purchase the Securities of a defaulting Initial Purchaser, either the
non defaulting Initial Purchasers or the Company may postpone the Closing Date
for up to five full business days in order to effect any changes that in the
opinion of counsel for the Company or counsel for the Initial Purchasers may be
necessary in
22
the Offering Memorandum or in any other document or arrangement, and the Company
agrees to promptly prepare any amendment or supplement to the Offering
Memorandum that effects any such changes. As used in this Agreement, the term
"Initial Purchaser" includes, for all purposes of this Agreement unless the
context otherwise requires, any person not listed in Schedule 1 hereto that,
pursuant to this Section 8, purchases Securities that a defaulting Initial
Purchaser agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the purchase
of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the
non-defaulting Initial Purchasers and the Company as provided in paragraph (a)
above, the aggregate principal amount of such Securities that remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
all the Securities, then the Company shall have the right to require each
non-defaulting Initial Purchaser to purchase the principal amount of Securities
that such Initial Purchaser agreed to purchase hereunder plus such Initial
Purchaser's pro rata share (based on the principal amount of Securities that
such Initial Purchaser agreed to purchase hereunder) of the Securities of such
defaulting Initial Purchaser or Initial Purchasers for which such arrangements
have not been made.
(c) If, after giving effect to any arrangements for the purchase
of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the
non-defaulting Initial Purchasers and the Company as provided in paragraph (a)
above, the aggregate principal amount of such Securities that remains
unpurchased exceeds one-eleventh of the aggregate principal amount of all the
Securities, or if the Company shall not exercise the right described in
paragraph (b) above, then this Agreement shall terminate without liability on
the part of the non-defaulting Initial Purchasers. Any termination of this
Agreement pursuant to this Section 8 shall be without liability on the part of
the Company or the Guarantors, except that the Company and each of the
Guarantors will continue to be liable for the payment of expenses as set forth
in Section 9 hereof and except that the provisions of Section 6 hereof shall not
terminate and shall remain in effect.
(d) Nothing contained herein shall relieve a defaulting Initial
Purchaser of any liability it may have to the Company, the Guarantors or any
non-defaulting Initial Purchaser for damages caused by its default.
9. Payment of Expenses. (a) Whether or not the transactions
contemplated by this Agreement are consummated or this Agreement is terminated,
the Company and each of the Guarantors jointly and severally agree to pay or
cause to be paid all costs and expenses incident to the performance of their
respective obligations hereunder, including without limitation, (i) the costs
incident to the authorization, issuance, sale, preparation and delivery of the
Securities and any taxes payable in that connection; (ii) the costs incident to
the preparation and printing of the Preliminary Offering Memorandum and the
Offering Memorandum (including any amendment or supplement thereto) and the
distribution thereof; (iii) the costs of reproducing and distributing each of
the Transaction Documents; (iv) the fees and expenses of the Company's and the
Guarantors' counsel and independent accountants; (v) the reasonable fees and ex-
23
penses incurred in connection with the registration or qualification and
determination of eligibility for investment of the Securities under the laws of
such jurisdictions as the Representative may designate and the preparation,
printing and distribution of a Blue Sky Memorandum (including the related fees
and expenses of counsel for the Initial Purchasers); (vi) any fees charged by
rating agencies for rating the Securities; (vii) the fees and expenses of the
Trustee and any paying agent (including related fees and expenses of any counsel
to such parties); (viii) all expenses and application fees incurred in
connection with the application for the inclusion of the Securities on the
PORTAL Market and the approval of the Securities for book-entry transfer by DTC;
and (ix) all expenses incurred by the Company in connection with any "road show"
presentation to potential investors. Except as otherwise provided herein, the
Initial Purchasers will pay all of their own costs and expenses in connection
with the transactions contemplated hereby, including, without limitation, the
fees and expenses of their counsel and transfer taxes, if any, on the resale of
Securities by them.
(b) If (i) this Agreement is terminated pursuant to Section 7,
(ii) the Company for any reason fails to tender the Securities for delivery to
the Initial Purchasers or (iii) the Initial Purchasers decline to purchase the
Securities for any reason permitted under this Agreement, the Company and each
of the Guarantors jointly and severally agrees to reimburse the Initial
Purchasers for all out-of-pocket costs and expenses (including the reasonable
fees and expenses of their counsel) reasonably incurred by the Initial
Purchasers in connection with this Agreement and the offering contemplated
hereby.
10. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the parties hereto and their
respective successors and any controlling persons referred to herein, and the
affiliates, officers and directors of each Initial Purchaser referred to in
Section 6 hereof. Nothing in this Agreement is intended or shall be construed to
give any other person any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein. No purchaser of
Securities from any Initial Purchaser shall be deemed to be a successor merely
by reason of such purchase.
11. Survival. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company, the Guarantors and
the Initial Purchasers contained in this Agreement or made by or on behalf of
the Company, the Guarantors or the Initial Purchasers pursuant to this Agreement
or any certificate delivered pursuant hereto shall survive the delivery of and
payment for the Securities and shall remain in full force and effect, regardless
of any termination of this Agreement or any investigation made by or on behalf
of the Company, the Guarantors or the Initial Purchasers.
12. Certain Defined Terms. For purposes of this Agreement, (a)
except where otherwise expressly provided, the term "affiliate" has the meaning
set forth in Rule 405 under the Securities Act; (b) the term "business day"
means any day other than a day on which banks are permitted or required to be
closed in New York City; (c) the term "Exchange Act"
24
means the Securities Exchange Act of 1934, as amended and (d) the term
"subsidiary" has the meaning set forth in Rule 405 under the Securities Act.
13. Miscellaneous. (a) Authority of the Representative. Any action
by the Initial Purchasers hereunder may be taken by the Representative on behalf
of the Initial Purchasers, and any such action taken by the Representative shall
be binding upon the Initial Purchasers.
(b) Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted and confirmed by any standard form of telecommunication. Notices to
the Initial Purchasers shall be given to the Representative at ▇.▇. ▇▇▇▇▇▇
Securities Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (fax: (212)
▇▇▇-▇▇▇▇), Attention: ▇▇▇▇▇▇ Tulip. Notices to the Company and the Guarantors
shall be given to them at Trinity Industries, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (fax: (▇▇▇) ▇▇▇-▇▇▇▇), Attention: ▇▇▇▇▇ Rice, Vice President
of Legal Affairs.
(c) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
the conflicts of law provisions thereof to the extent the application of the
laws of another jurisdiction would be required thereby.
(d) Counterparts. This Agreement may be signed in counterparts
(which may include counterparts delivered by any standard form of
telecommunication), each of which shall be an original and all of which together
shall constitute one and the same instrument.
(e) Amendments or Waivers. No amendment or waiver of any provision
of this Agreement, nor any consent or approval to any departure therefrom, shall
in any event be effective unless the same shall be in writing and signed by the
parties hereto.
(f) Headings. The headings herein are included for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
25
If the foregoing is in accordance with your understanding, please
indicate your acceptance of this Agreement by signing in the space provided
below.
Very truly yours,
TRINITY INDUSTRIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Executive Vice President
Guarantors:
TRANSIT MIX CONCRETE & MATERIALS COMPANY
TRINITY INDUSTRIES LEASING COMPANY
TRINITY MARINE PRODUCTS, INC.
TRINITY RAIL GROUP, LLC
THRALL TRINITY FREIGHT CAR, INC.
TRINITY TANK CAR, INC.
TRINITY RAIL COMPONENTS & REPAIR, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Executive Vice President of each of
the Guarantors listed above
S-1
Accepted: March 5, 2004
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
For itself and on behalf of the
several Initial Purchasers listed
in Schedule 1 hereto (other than
Credit Suisse First Boston LLC)
By /s/ ▇▇▇▇▇ ▇▇▇▇▇
------------------------------------
Authorized Signatory
CREDIT SUISSE FIRST BOSTON LLC
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------
Authorized Signatory
S-2