INTEREST TRANSFER AGREEMENT
Exhibit 10.23
This INTEREST TRANSFER AGREEMENT (as amended, modified and supplemented from time to
time, the “Agreement”) dated as of June 30, 2005, effective as of January 1, 2005 (the “Effective
Time”), between ACF INDUSTRIES HOLDING CORP., a corporation organized under the laws of the State
of Delaware (the “Transferor), and AMERICAN RAILCAR INDUSTRIES, INC., a corporation organized
under the laws of the State of Missouri (the “Transferee”).
W I T N E S S E T H
WHEREAS, the Transferor is the owner of one hundred percent (100%) of the limited liability
company member interests (the “Interests”) of Castings, LLC, a Delaware limited liability company
(“Castings”); and
WHEREAS, the Transferor desires to transfer as of the Effective Time all of the Interests to
the Transferee and the Transferee desires to accept such Interests as of the Effective Time on the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual promises and covenants contained in this
Agreement, and intending to be legally bound by the terms and conditions of this Agreement, the
parties hereto hereby agree as follows:
Section 1. Definitions.
1.1. The following capitalized terms shall have the following meanings:
“Asserted
Liability” shall have the meaning set forth in Section 5.3(1).
“Claims Notice” shall have
the meaning set forth in Section 5.3(1).
“Contribution
Agreement” shall mean that certain Contribution Agreement made and entered into
effective as of December 18, 2003 by and among Amsted Industries Incorporated, ▇▇▇▇▇▇▇▇▇, Inc. and
Transferor.
“Guaranty” shall means that certain Corporate Guaranty dated as of December 1, 2003 issued by
Transferor in favor of the director of Development of the State of Ohio.
“Indemnifying Party” shall have the meaning set forth in Section 5.3(1).
“Indemnitee” shall have the meaning set forth in Section 5.3(1).
“Lien” means, with respect to any asset, (i) any mortgage, deed of trust, lien, pledge, claim,
equity interest, participation interest, security interest or other charge or encumbrance of any
kind in or on such asset and (ii) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement relating to such asset.
“Losses”shall have the meaning set forth in Section 5.1.
“Note”shall mean a promissory note in the amount of $12,000,000 in the form of Exhibit A
attached hereto to be issued by the Transferee to the Transferor pursuant to this Agreement.
“Permitted Liens”shall mean (a) Liens for taxes, assessments or governmental charges or
levies which are not yet assessed or, if assessed, not yet due or contested in good faith by
appropriate proceedings so long as such proceedings, in the reasonable judgment of the Transferor,
do not involve any danger of sale, forfeiture or loss, of the Interests, and (b) Liens arising out
of judgments or awards against the Transferor which are being contested in good faith by
appropriate proceedings and with respect to which there shall have been secured a stay of execution
pending such appeal or proceedings for review, so long as such proceedings, in the reasonable
judgment of the Transferor, do not involve any danger of sale, forfeiture or loss, of the
Interests.
“Related
Agreements”shall have the meaning set forth in Section 2.3.
“Required Consents”shall have the meaning set forth in Section 3.1(6).
1.2. The headings or subheadings of Sections are inserted for convenience of reference only
and shall not in any way affect the interpretation or construction of this Agreement. The Exhibit
to this Agreement shall form an integral part hereof. References herein to any agreement or other
instrument shall be deemed to include references to such agreement or other instrument as varied,
amended, supplemented or replaced from time to time pursuant to the applicable provisions thereof.
Where the context permits, words importing the plural shall include the singular and vice versa,
and references to a person or “Person” shall be construed as references to an individual, firm,
company, corporation or unincorporated body of persons.
Section 2.
Agreement to Transfer and Assign: Delivery and Acceptance.
2.1. On the terms and subject to the conditions set forth herein, (i) the Transferor
transfers, assigns, sets over and otherwise conveys to the Transferee as of the Effective Time, all
of the Transferor’s right, title and interest in, to and under the Interests, and (ii) as of the
Effective Time, the Transferee accepts, assumes, takes over and succeeds to all of the Transferor’s
rights, title and interest as of such date in and to the Interests, and the Transferee covenants
and agrees to discharge, perform and comply with, and to be bound by, all the terms, conditions,
provisions, obligations, covenants and duties of the Transferor in connection with the Interests,
including, without limitation, those arising under (i) the Limited Liability Company Agreement of
Casting, LLC, as the same may be amended from time to time, (ii) the Guaranty, as the same may be
amended from time to time, (iii) the Operating Agreement of Ohio Castings Company, LLC, as the same
may be amended from time to time, (iii) the Contribution
Agreement, as the same may be amended from time to time, and (iv) the Related Agreements, (in
each case, whether or not any of it relates to the period before or after the date hereof), as if
the Transferee were an original party thereto.
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2.2. Subject to all the terms and conditions of this Agreement and in reliance upon the
representations, warranties and covenants set forth herein, (a) the Transferee hereby issues the
Note to the Transferor and (b) the Transferor hereby accepts, as consideration for the transfer by
it of the Interests, such Note, all in accordance with the terms of this Agreement.
2.3. Transferee hereby agrees to pay directly to any Person from and after the date hereof any
amounts required to be paid by Transferor (whether or not any of such amounts relate to the period
before or after the date hereof) under (i) the Guaranty, as the same may be amended from time to
time, (ii) the Operating Agreement of Ohio Castings Company, LLC, as the same may be amended from
time to time, (iii) the Contribution Agreement, as the same may be amended from time to time, and
(iv) any other agreements or undertakings, whether or not in writing, (the “Related Agreements”),
if any, entered into by Transferor in connection with Ohio Castings Company, LLC or Alliance
Castings Company, LLC or two loans in the approximate aggregate amount of $12 million from or
guaranteed by the State of Ohio. All of the foregoing amounts payable by the Transferee pursuant to
this Section 2.3 shall be due immediately upon written demand by the Transferor, which written
demand shall be deemed to constitute certification that the amount demanded is then required to be
paid. In the event that the Transferee fails to make an immediate payment pursuant to this
Section 2.3 upon its receipt of the written notice from the Transferor, (i) the Transferor may make
such payment itself without prejudice to any rights and remedies it would have against the
Transferee, and (ii) the Transferee agrees to indemnify, defend and hold harmless the Transferor
(and its directors, officers, employees, affiliates, successors and assigns) from and against all
losses, liabilities, damages, deficiencies, demands, claims, actions, judgments or causes of
action, assessments, costs or expenses (including, without limitation, interest, penalties and
reasonable attorneys’ fees and disbursements) based upon, arising out of, or otherwise in respect
of any such failure by the Transferee in making any such payment. For the avoidance of doubt,
the Transferee’s obligations under this Section 2.3, including, without limitation, any payment
obligations under the Related Agreements and indemnification obligations, shall in no way be
limited or otherwise avoided by the Assignment and Assumption, Novation and Release, dated as of
June 30, 2005, among the Transferor, the Transferee, and the other parties thereto.
Section 3.
Representations; Warranties and Covenants.
3.1. The Transferor represents and warrants to the Transferee that:
(1) Organization;
Powers. The Transferor (i) is a corporation
duly organized, validly existing and in good standing under the laws of the State of
Delaware, (ii) has all requisite power to own its property and assets and to carry on its
business as now conducted and as proposed to be conducted, (iii) is qualified to do
business in every jurisdiction where such qualification is required, except where the
failure to so qualify would not have a material adverse effect on the performance by the
Transferor of its obligations under this Agreement, and (iv) has the power and authority to
execute, deliver and perform its obligations under this Agreement.
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(2) Authorization;
Conflicts. The execution, delivery and performance by the
Transferor of this Agreement and the performance of the transactions contemplated hereby and
thereby (i) have been duly authorized by all requisite action and (ii) will not (A) violate (1) any
provision of law, statute, rule or regulation the effect of which would be to cause or be
reasonably expected to have a material adverse effect on the ability of the Transferor to perform
any of its obligations under this Agreement, (2) any order of any governmental authority having
proper jurisdiction over the Transferor, (3) any provision of the organizational documents of the
Transferor, or (4) any provision of any indenture, loan agreement or other material agreement to
which the Transferor is a party or by which it or any of its property is or may be bound, (B) be in
conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both)
a default under any such indenture, loan agreement or other material agreement or (C) result in the
creation or imposition of any Lien upon or with respect to the Interests.
(3) Enforceability. This Agreement has been duly authorized, executed and delivered by
the Transferor and constitute the legal, valid and binding obligations of the Transferor
enforceable against the Transferor in accordance with their terms, subject to bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and
subject to general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(4) Title
and Ownership. The Transferor is the sole legal and beneficial owner of the
Interests and has full power and lawful authority to transfer, convey and assign to the Transferee
all of the Transferor’s right, title and interest in and to the Interests in the manner
contemplated hereby. The provisions of this Agreement are effective, respectively, to convey to,
and vest in, the Transferee ownership of the Interests, and the Transferee shall be entitled to
exercise all rights of a member under such Interests. After giving effect to the consummation of
the transactions contemplated hereby, neither the Transferor nor any person claiming under or
through the Transferor has any valid claim to or interest in the Interests except for Permitted
Liens.
(5) Liens. The Interests are free from all Liens other than Permitted Liens. Upon
execution of this Agreement, legal title to the Interests and all rights and benefits under the
Interests shall pass to the Transferee as of the Effective Time.
(6) Consents and Approvals. Except for such consents, approvals,
authorizations, filings, or declarations that have been made and that are in full
force and effect (the “Required
Consents”),no consent, approval or authorization from, or
filing or declaration with, any Person or any Governmental Authority is required to be made by the
Transferor to give the Transferee a perfected ownership interest in the Interests or for the
consummation of the transactions contemplated hereby.
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3.2. The Transferee represents and warrants to the Transferor that:
(1) Organization:
Powers. The Transferee (i) is a corporation duly formed, validly
existing and in good standing under the laws of the State of Missouri, (ii) has all requisite power
and authority to own its property and assets and to carry on its business as now conducted and as
proposed to be conducted, (iii) is qualified to do business in every jurisdiction where such
qualification is required, except where the failure to so qualify would not have a material adverse
effect on the performance by the Transferee of its obligations under this Agreement, and (iv) has
the power and authority to execute, deliver and perform its obligations under this Agreement.
(2) Authorization. The execution, delivery and performance by the Transferee of this
Agreement, the issuance of the Note and the performance of the transactions contemplated hereby and
thereby (i) have been duly authorized by all requisite action and (ii) will not (A) violate (1) any
provision of law, statute, rule or regulation the effect of which would be to cause or be
reasonably expected to have a material adverse effect on the ability of the Transferee to perform
any of its obligations under this Agreement, (2) any order of any governmental authority having
proper jurisdiction over the Transferee, (3) any provision of the organizational documents of the
Transferee, or (4) any provision of any indenture, loan agreement or other material agreement to
which the Transferee is a party or by which it or any of its property is or may be bound, or (B) be
in conflict with, result in a breach of or constitute (alone or with notice or lapse of time or
both) a default under any such indenture, loan agreement or other material agreement.
(3) Enforceability. This Agreement has been duly authorized, executed and delivered by
the Transferee and constitute the legal, valid and binding obligations of the Transferee
enforceable against the Transferee in accordance with their terms, subject to bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors, rights generally and
subject to general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(4) Consents
and Approvals. Except for such consents, approvals,
authorizations, filings, or declarations that have been made and that are in full force and effect
(the “Required Consents”),no consent, approval or authorization from, or filing or declaration
with, any Person or any Governmental Authority is required to be made by the Transferor to give the
Transferee a perfected ownership interest in the Interests or for the consummation of the
transactions contemplated hereby.
3.3. All representations, warranties, covenants and agreements of the parties contained herein
shall survive the execution and delivery of this Agreement and the closing hereunder.
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Section 4.
Further Assurances.
4.1. The Transferor agrees that at any time and from time to time at Transferee’s expense,
the Transferor shall promptly and duly execute, deliver, file, register and record any and all
such further instruments and documents and take such further actions as required by law or as the
Transferee may reasonably request in writing in order (i) to protect the title and ownership of
the Transferee to the Interests and (ii) to permit the Transferee to obtain the full benefits of
this Agreement and the rights and powers herein granted.
Section 5.
Indemnification: Limitation on Liability.
5.1.
Obligation of the Transferor To Indemnify. The Transferor agrees to indemnify,
defend and hold harmless the Transferee (and its directors, officers, employees, affiliates,
successors and assigns) from and against all losses, liabilities, damages, deficiencies, demands,
claims, actions, judgments or causes of action, assessments, costs or expenses (including,
without limitation, interest, penalties and reasonable attorneys’ fees and
disbursements) (“Losses”) based upon, arising out of, or otherwise in respect of (i) any inaccuracy
in or any breach of any representation, warranty, covenant or agreement of the Transferor contained
in this Agreement, and (ii) the ownership of the Interests prior to the date hereof. After the date
hereof, the Transferee’s sole remedy for any breach of any representation or warranty of the
Transferor expressly set forth in this Agreement shall be for indemnification pursuant to this
Section 5.
5.2.
Obligation of the Transferee To Indemnify. The Transferee agrees to indemnify,
defend and hold harmless the Transferor (and its directors, officers, employees, affiliates,
successors and assigns) from and against all Losses based upon, arising out of, or otherwise in
respect of any inaccuracy in or any breach of (i) any representation, warranty, covenant or
agreement of the Transferee contained in this Agreement and (ii) the ownership of the Interests on
and after the date hereof. After the date hereof, the Transferor’s sole remedy for any breach of
any representation or warranty of the Transferee expressly set forth in this Agreement shall be for
indemnification pursuant to this Section 5.
5.3.
Notice and Opportunity To Defend.
(1) Notice
of Asserted Liability. Promptly after receipt by any party hereto
(the “Indemnitee”) of notice of any demand, claim or circumstances, which, with a lapse of
time, would or might give rise to a claim or the commencement (or threatened commencement)
of any action, proceeding or investigation (the “Asserted
Liability”) that may result in a
Loss, the Indemnitee shall give notice thereof (the
“Claims Notice”) to any other party
obligated to provide indemnification pursuant to Section 5.1 or
5.2 (“Indemnifying Party”).
The Claims Notice shall describe the Asserted Liability in reasonable detail and shall
indicate the amount (estimated if necessary and to the extent feasible) of the Loss that
has been or may be suffered by the Indemnitee.
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(2) Opportunity
To Defend. The Indemnifying Party may elect
to compromise or defend, at its own expense and by its own counsel, any Asserted
Liability. If the Indemnifying Party elects to compromise or defend such Asserted
Liability, it shall, within 30 days (or sooner, if the nature of the Asserted Liability
so
requires), notify the Indemnitee of its intent to do so, and the Indemnitee shall
cooperate,
at the expense of the Indemnifying Party, in the compromise of, or defense against, such
Asserted Liability. If the Indemnifying Party elects not to compromise or defend the
Asserted Liability, fails to notify the Indemnitee of its election as herein provided or
contests its obligation to pay an indemnity under this Agreement, the Indemnitee may
pay, compromise or defend such Asserted Liability. Notwithstanding the foregoing,
neither the Indemnifying Party nor the Indemnitee may settle or compromise any claim
over the objection of the other; provided, however, that consent to settlement
or
compromise shall not be unreasonably withheld. In any event, the
Indemnitee and the
Indemnifying Party may participate, at their own expense, in the defense of any such
Asserted Liability. If the Indemnifying Party chooses to defend any claim, the
Indemnitee
shall make available to the Indemnifying Party any books, records or
other documents
within its control that are necessary or appropriate for such defense.
(3) Limitations on Liability;
Payments. The aggregate liability
of the Transferor for indemnification under this Section 5 and for all breaches of its
representations or warranties expressly set forth herein shall be limited to
$12,000,000.
All indemnification payments shall be made by the Transferor in immediately available
funds, without set-off.
Section 6. Notices.
Any notice or communication under this Agreement shall be sufficiently given if in
writing and mailed by first-class mail, postage prepaid, or delivered in person or by telex,
telecopier or overnight air courier guaranteeing next day delivery, addressed as follows:
If
to the Transferor:
ACF Industries Holding Corp.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy no.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
ACF Industries Holding Corp.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy no.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
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with a copy to:
Icahn Associates Corp.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Transferee:
American Railcar Industries, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Treasurer
Telecopy no.: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Treasurer
Telecopy no.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Icahn Associates Corp.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Legal Department
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Either of the above parties by notice to the other party may designate additional or different
addresses for subsequent notices or communications. All notices and communications shall be deemed
to have been duly given: at the time of delivery by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt acknowledged, if telecopier; and the next business day after timely delivery
to the courier, if sent by overnight air courier guaranteeing next day delivery. If a notice or
communication is given in the manner provided above within the time prescribed, it is duly given,
whether or not such party receives it.
Section 7. Amendment.
Neither this Agreement nor any of the terms hereof may be terminated, amended, supplemented,
waived or modified, except by an instrument in writing signed by the Transferee and the Transferor.
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Section 8. Successors and Assigns.
All covenants and agreements in this Agreement made by or on behalf of the parties hereto
shall bind and inure to the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not.
Section 9. Counterparts.
This Agreement may be executed in any number of counterparts, each of which when so
executed shall be deemed to be an original and such counterparts together shall constitute but one
Agreement.
Section 10. GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF
JURY DUTY.
(a) IN ACCORDANCE WITH SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATION LAW, THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED 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 AND
THE OBLIGATIONS, RIGHTS, AND REMEDIES OF THE PARTIES UNDER THIS
AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
(b) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE
TRANSFEREE OR THE TRANSFEROR ARISING OUT OF OR RELATING TO THIS
AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY, MAY BE
INSTITUTED IN ANY FEDERAL OR STATE COURT IN ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ AND THE TRANSFEREE AND THE TRANSFEROR EACH
HEREBY WAIVE ANY OBJECTION WHICH 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, THE
TRANSFEREE AND THE TRANSFEROR EACH HEREBY IRREVOCABLY SUBMITS
TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR
PROCEEDING.
(c) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES, AS AGAINST THE OTHER PARTIES 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 OR
ANY OTHER OPERATIVE DOCUMENT, INCLUDING IN RESPECT OF THE
NEGOTIATION, ADMINISTRATION OR ENFORCEMENT HEREOF OR THEREOF.
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Section 11. Severability.
Any provision of this Agreement that may be prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof so long as the economic or
legal substance for the transactions contemplated thereby is not affected in any manner adverse to
any party. Any such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
[remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as of the date
first above written.
| ACF INDUSTRIES HOLDING CORP. | ||||||
| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ | |||||
| Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ | ||||||
| Title: President | ||||||
| AMERICAN RAILCAR INDUSTRIES, INC. | ||||||
| By: | /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ | |||||
| Name: ▇▇▇▇▇ ▇.▇▇▇▇▇ | ||||||
| Title: President | ||||||
[Interest Transfer Agreement re Castings LLC]