RRIF_-_Form_of_Financing_Agreement-_0912_HOU03_1313977_9.pdf

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FINANCING AGREEMENT

Dated as of [______] between

[BORROWER]

and

The UNITED STATES OF AMERICA, represented by the SECRETARY OF TRANSPORTATION acting through the ADMINISTRATOR of the FEDERAL RAILROAD ADMINISTRATION

THIS FORM OF A RRIF FINANCING AGREEMENT FOR A DIRECT LOAN SETS FORTH KEY TERMS

AND CONDITIONS THAT ARE TYPICALLY REQUIRED FOR EXECUTION OF A RRIF FINANCING

AGREEMENT. THIS DOCUMENT CANNOT ANTICIPATE, HOWEVER, ALL TERMS THAT MUST BE

NEGOTIATED BETWEEN THE PARTIES. IF A PROJECT IS APPROVED FOR RRIF FINANCING, THE

STRUCTURE OF THE RRIF FINANCING AND THE FINANCING AGREEMENT WILL BE BASED ON THE

FINAL FINANCIAL PLAN AND NEGOTIATED TERMS AND CONDITIONS WITH THE BORROWER, AND

IS SUBJECT TO FINAL APPROVAL BY USDOT.

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TABLE OF CONTENTS

Article I Term 1 Section 1.1 Definitions Section 1.2 Interpretation Section 1.3 [Continuing Default

Article II Issuance of Debt Section 2.1 Issuance of Debt Section 2.2 Interest Section 2.3 Disbursement Conditions Section 2.4 Outstanding Loan Balance; Loan Amortization Schedule Section 2.5 Repayment Section 2.6 Optional Prepayment Section 2.7 Mandatory Prepayment Section 2.8 Transfer and Related Representations Section 2.9 Obligations Surviving Transfer

Article III Conditions Section 3.1 Closing Date Section 3.2 Each Loan Disbursement

Article IV Representations and Warranties Section 4.1 Organization and Good Standing Section 4.2 Validity of Agreement Section 4.3 No Bankruptcy of Current Officers and Directors; No Felony Conviction or Securities Law Violation Section 4.4 Debarment Section 4.5 No Changes Since Most Recent Balance Sheet Section 4.6 Material Contracts, Judgments, Decrees, Obligations or Liabilities Section 4.7 Litigation Section 4.8 Defaults and Violations Section 4.9 Completeness of Information Section 4.10 Tax Returns Section 4.11 [Related Persons Section 4.12 Title to Properties Section 4.13 Collateral Section 4.14 Insurance Section 4.15 Investment Company Matters Section 4.16 Capitalization and Subsidiaries Section 4.17 [Principal Project Contracts Section 4.18 [Solvency Section 4.19 Ranking of Obligations Section 4.20 ERISA Compliance Section 4.21 Public Benefit of RRIF Financial Assistance

Article V Affirmative Covenants

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Section 5.1 Financial Statements and Other Documentation Section 5.2 Notification of Events Section 5.3 Use of Proceeds Section 5.4 Payment of Taxes and Other Claims Section 5.5 Maintenance of Insurance Section 5.6 Rehabilitation, Operation and Maintenance of Properties Section 5.7 Books and Records Section 5.8 Single Audit Act Section 5.9 Compliance with Applicable Laws Section 5.10 Audit and Inspection Rights Section 5.11 Debarment and Suspension Section 5.12 Small and Disadvantaged Businesses Section 5.13 Cargo Preference Section 5.14 Domestic Buying Preference Section 5.15 Employee Protection Section 5.16 Maintenance of Legal Structure Section 5.17 [Performance of Principal Project Contracts Section 5.18 Further Assurances Section 5.19 [Section 1168 of the Bankruptcy Code

Article VI Negative Covenants Section 6.1 Indebtedness Section 6.2 Investments, Loans and Acquisitions Section 6.3 Purchase or Lease of Assets Section 6.4 Prohibited Interest Section 6.5 [Distributions; Certain Payments of Indebtedness Section 6.6 Merger, Dissolution or Sale of Assets Section 6.7 Encumbrances Section 6.8 Conduct of Business; Deployment of Assets Section 6.9 Discontinuance or Abandonment of Business Section 6.10 [Abandonment of Rail Line Section 6.11 [Salaries of Officers Section 6.12 Restrictive Agreements Section 6.13 Amendment to Organization Documents Section 6.14 [Amendment to Principal Project Contracts Section 6.15 Hedge Agreements Section 6.16 ERISA Compliance Section 6.17 Financial Test[s]

Article VII Events of Default and Remedies Section 7.1 Events of Default Section 7.2 Remedies

Article VIII Miscellaneous Provisions Section 8.1 Incorporation of Exhibits, Schedules and Documents Section 8.2 Entire Agreement Section 8.3 Parties Bound; Right to Assign

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Section 8.4 Table of Contents and Headings Section 8.5 Notices; Action to be Taken Section 8.6 Release of Information Section 8.7 No Waiver by Administrator or Holder Section 8.8 Waiver of Jury Trial Section 8.9 Governing Law and Venue Section 8.10 Expenses; Indemnification Section 8.11 Representatives Section 8.12 Counterparts Section 8.13 Severability Section 8.14 Amendments and Waivers Section 8.15 No Third Party Rights Section 8.16 Administrator’s Obligations Section 8.17 No Personal Recourse

LIST OF SCHEDULES

Schedule 3.1(f): Mortgaged Properties Schedule 4.7: Litigation Schedule 4.16: Subsidiaries Schedule 5.9: Environmental Mitigation Requirements and Commitments Schedule 6.1: Existing Indebtedness Schedule 6.2: Existing Investments Schedule 6.7: Existing Liens

LIST OF EXHIBITS

Exhibit A: Application Exhibit B: Project Description Exhibit C: Form of Compliance Certificate Exhibit D: Form of Note Exhibit E: Form of Certificate of Authorized Designee Exhibit F: Requisition Procedures Exhibit G: Form of Opinion of [ ] Exhibit H: Form of Closing Certificate Exhibit I: Form of Solvency Certificate Exhibit J: Form of Perfection Certificate

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FINANCING AGREEMENT

THIS FINANCING AGREEMENT (this “Agreement”) is made and entered into on this [____] day of [Month], [Year], in Washington, D.C., by and between the UNITED STATES OF AMERICA, represented by the SECRETARY OF TRANSPORTATION acting through the ADMINISTRATOR of the FEDERAL RAILROAD ADMINISTRATION (the “Lender”), and [BORROWER], a [corporation] organized and existing under the laws of the state of [State] (the “Borrower”).

RECITALS

WHEREAS, the Secretary (as defined herein) is authorized, pursuant to the Act (as defined herein), to provide financial assistance for purposes consistent with the Act as may be approved by the Secretary, and the Secretary has duly delegated the Secretary’s authority under the Act to the Administrator (as defined herein);

WHEREAS, under the Act, the Borrower has submitted the Application (as defined herein) to the Administrator requesting a loan in the amount of [LOAN AMOUNT] Dollars ($[ ]), for the Project, as described in Exhibit B hereto;

WHEREAS, in connection herewith, the Borrower and the other Loan Parties (as defined herein) will execute and deliver to the Administrator the Security Agreement (as defined herein) and certain other documents to secure the repayment of the loan to be made hereunder;

and

WHEREAS, the Administrator has made the findings required under the Act and is willing to execute this Agreement and make a loan to the Borrower pursuant to the Act and in accordance with the terms and conditions hereof.

NOW, THEREFORE, in consideration of the premises and the mutual undertakings hereinafter set forth, the parties hereto agree as follows:

ARTICLE I

TERM

Section 1.1 Definitions. As used in this Agreement, the following terms have the meanings specified below:

(1) “Act” means Title V of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. §821 et seq.).

(2) “Administrator” means the Administrator of the Federal Railroad Administration or the Administrator’s designee.

(3) “Affiliate” means, with respect to any Person (other than the Administrator), (i) any other Person directly or indirectly Controlling, Controlled by, or under common Control with, such Person and (ii) any Person beneficially owning or holding, directly or indirectly, 10% or more of any class of securities having ordinary

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voting power for the election of directors or other members of the governing body of a corporation or other Person, or 10% or more of any partnership or other ownership interests having ordinary voting power for the election of directors or other members of the governing body of a corporation or any other Person. “Affiliate” of the Administrator means any department or agency of the government of the United States of America.

(4) “Agreement” has the meaning assigned to such term in the preamble hereto.

(5) “Allowable Costs” means those costs associated with the Project which may be paid, reimbursed or refinanced with funds made available under this Agreement, as detailed in Exhibit B. Cost for any work performed by an outside contractor (rather than by [the Borrower][any Loan Party] with its own employees) under a contract whose total consideration exceeds $[_________] shall be considered Allowable Costs only if the contractor was selected pursuant to a competitive bidding process in which at least one bidder was not [the Borrower][such Loan Party], any Affiliate of [the Borrower][such Loan Party], or an entity in which any Officer or employee of [the Borrower][such Loan Party] or any Affiliate thereof has a financial interest.

(6) “Application” means the application that the Borrower submitted to the Administrator to support the Borrower’s loan request, including all exhibits and attachments and supplementary materials, which is attached hereto as Exhibit A.

(7) “Availability Period” means the period from and including the Closing Date to but excluding [______][the Final Maturity Date].

(8) “Bankruptcy Code” means the United States Bankruptcy Code (11 U.S.C. §101 et seq.).

(9) “Base Case Financial Plan” means the first Financial Plan delivered to the Administrator after the date hereof.

(10) “Board of Directors” means, with respect to any Loan Party, the duly-elected board of directors of such Loan Party.

(11) “Borrower” has the meaning assigned to such term in the preamble hereto.

(12) “Business” means the following business conducted by any Loan Party: [railroad transportation and related ancillary services including but not limited to freight railroad transportation and passenger trains.]1

(13) “Business Day” means any day other than a Saturday, a Sunday or a day on which offices of the government of the United States of America [or the State of

1 Revise as necessary.

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[____]] are authorized to be closed or on which commercial banks are authorized or required by law, regulation or executive order to be closed in New York, New York [or [_______]].2

(14) “Capital Expenditures” means expenditures made or liabilities incurred for the acquisition of any fixed assets or improvements, replacements, substitutions or additions thereto that have a useful life of more than one year which are capitalized in accordance with GAAP.

(15) “Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

(16) “Change in Control” means

(i) [any Person or group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof) [(other than _____)]3 acquires ownership, directly or indirectly, beneficially or of record of Equity Interests representing more than [ ]% of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests of the [Borrower]]4;

(ii) [[Parent] ceases to own, free and clear of all Liens or other encumbrances, at least [100][75][50]% of the Equity Interests in the Borrower on a fully diluted basis;]5

(iii) a majority of the seats (other than vacant seats) on the Board of Directors of the [Borrower][Parent] are occupied by Persons who were neither (A) nominated by such Board of Directors nor (B) appointed by Directors so nominated; and

(iv) any Person or group [(other than ____)] acquires or obtains possession of the power, directly or indirectly, to direct or cause the direction of management and policy of the Borrower, whether through ownership of voting securities, by contract, management agreement, or common directors, officers or trustees or otherwise.

(17) “Closing Date” means the date on which the conditions specified in Section 3.1 are satisfied (or waived in accordance with Section 8.14).

2 Insert city and state in which the Project is located, if applicable.

3 Insert reference to current equity holders or other permitted equity holders.

4 Use clause (i) if the Borrower (or, to the extent relevant, its parent) is a public company.

5 Use clause (ii) if the Borrower is a private company.

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(18) “Code” means the Internal Revenue Code of 1986.

(19) “Collateral” means all real and personal property of any Person that is subject to the security interests or Liens created pursuant to any of the Collateral Documents.

(20) “Collateral Document” means the Security Agreement, [each Mortgage], any other documents granting a Lien upon the Collateral as security for payment of the Obligations and any memorandum of any of the foregoing that is filed with any public agency.

(21) “Completion” means the date on which the requirements for the achievement of “[Completion]” as set forth in Exhibit B have been met [and the entire Project opens to rail traffic (or such comparable event determined by the Lender take place)].

(22) “Compliance Certificate” means a certificate substantially in the form of Exhibit C.

(23) “Consolidated Current Ratio” means the ratio of (i) consolidated current assets of the Borrower and its Subsidiaries to (ii) consolidated current liabilities of the Borrower and its Subsidiaries, in each case determined in accordance with GAAP.

(24) “Consolidated EBITDA” means, for any period, Consolidated Net Income for such period plus (i) without duplication and to the extent deducted in determining Consolidated Net Income for such period, the sum of (A) Consolidated Interest Expense for such period, (B) income tax expense for such period (net of tax refunds), (C) all amounts attributable to depreciation, depletion and amortization expense for such period, (D) any extraordinary non-cash charges for such period, and (E) any other non-cash charges for such period (but excluding (x) any non-cash charge in respect of an item that was included in Consolidated Net Income in a prior period and (y) any non-cash charge that relates to the write-down or write-off of inventory), minus

(ii) without duplication and to the extent included in determining Consolidated Net Income for such period, (A) any cash payments made during such period in respect of non-cash charges described in clause (i)(E) taken in a prior period and (B) any extraordinary gains and any non-cash items of income for such period, all calculated for the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP.

(25) “Consolidated Fixed Charge Coverage Ratio” means the ratio, determined as of the end of each Fiscal Quarter for the most recently ended four Fiscal Quarters, of (i) Consolidated EBITDA for such period, to (ii) the sum without duplication of (A) Consolidated Interest Expense, (B) scheduled payments of principal on Consolidated Total Indebtedness, (C) consolidated Capital Expenditures and (D) the portion of taxes based on income actually paid in cash and provisions for cash income taxes, all calculated for the Borrower and its Subsidiaries on a consolidated basis for such period.

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(26) “Consolidated Interest Coverage Ratio” means the ratio, determined as of the end of each Fiscal Quarter for the most recently ended four Fiscal Quarters, of (i) Consolidated EBITDA for such period, to (ii) Consolidated Interest Expense for such period.

(27) “Consolidated Interest Expense” means, for any period, total interest expense (including that attributable to Capital Lease Obligations) of the Borrower and its Subsidiaries for such period with respect to all outstanding Indebtedness of the Borrower and its Subsidiaries, calculated on a consolidated basis for the Borrower and its Subsidiaries for such period in accordance with GAAP.

(28) “Consolidated Net Income” means, for any period, the net income (or loss) of the Borrower and its Subsidiaries, determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded (i) the income (or deficit) of any Person accrued prior to the date it becomes a Subsidiary of the Borrower or is merged into or consolidated with the Borrower or any of its Subsidiaries, (ii) the income (or deficit) of any Person (other than a Subsidiary of the Borrower) in which the Borrower or any of its Subsidiaries has an ownership interest, except to the extent that any such income is actually received by the Borrower or such Subsidiary in the form of dividends or similar distributions and (iii) the undistributed earnings of any Subsidiary of the Borrower to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary is not at the time permitted by the terms of any contractual obligation or any law applicable to such Subsidiary.

(29) “Consolidated [Tangible] Net Worth” means, as of any date of determination, consolidated total [tangible] assets over consolidated total liabilities, in each case, of the Borrower and its Subsidiaries.

(30) “Consolidated Senior Indebtedness” means all Indebtedness of the Borrower and its Subsidiaries, determined on a consolidated basis in accordance with GAAP, other than [Subordinated Indebtedness].

(31) “Consolidated Senior Leverage Ratio” means, as of any date of determination, the ratio of (i) Consolidated Senior Indebtedness as of such date to

(ii) Consolidated EBITDA for the period of four Fiscal Quarters most recently ended.

(32) “Consolidated Total Indebtedness” means all Indebtedness of the Borrower and its Subsidiaries, determined on a consolidated basis in accordance with

GAAP.

(33) “Consolidated Total Leverage Ratio” means, as of any date of determination, the ratio of (i) Consolidated Total Indebtedness as of such date to

(ii) Consolidated EBITDA for the period of four Fiscal Quarters most recently ended.

(34) “Control” means, in relation to any Person

(i) the power to (A) cast, or control the casting of, more than one-half of the maximum number of votes that might be cast at a general meeting

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of such Person; or (B) appoint or remove all, or a majority, of the board of directors or other equivalent officers of such Person; or (C) give directions with respect to the operating and financial policies of such Person which the directors or other equivalent officers of such Person are obliged to comply with; or

(ii) the holding of more than one-half of the issued and voting capital of such Person (excluding any part of that capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital).

(35) The terms “Controlling” and “Controlled” have corresponding meanings.

(36) “Credit Risk Premium” means a fee that shall be paid by Borrower prior to any drawdown. That fee shall be equal to [ ]% of the amount of the drawdown, or a maximum of $[ ], upon the making of the Loan in the Maximum Aggregate Principal Amount.

(37) “Debt Service Coverage Ratio” means the ratio, determined as of the end of each Fiscal Quarter for the most recently ended four Fiscal Quarters of

(i) Consolidated EBITDA for such period to (ii) the sum without duplication of

(A) Consolidated Interest Expense for such period and (B) scheduled payments of principal on Consolidated Total Indebtedness made during such period.

(38) “Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

(39) “Default Rate” means a rate of [0.0329% for each day after the relevant due date until the day that the subject amount is paid; provided, however, that (i) such rate shall not exceed 600 basis points per annum with respect to past due amounts more than 90 days past due and (ii) such rate shall in no event exceed the maximum rate permitted by law.]

(40) “Director” means, with respect to any Loan Party, any person duly elected and currently serving on the Board of Directors of such Loan Party.

(41) “Distribution” means any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in any Person or any of such Person’s Subsidiaries, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests or any option, warrant or other right to acquire any such Equity Interests.

(42) “Equity Interests” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any such equity interest.

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(43) “ERISA” means the Employee Retirement Income Security Act of 1974.

(44) “ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

(45) “ERISA Event” means (i) a Reportable Event with respect to a Pension Plan, (ii) a withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA, (iii) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization, (iv) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan, (v) an event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan, or (vi) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate.

(46) “Event of Default” has the meaning assigned to such term in Section 7.1.

(47) “Final Maturity Date” means [________][[_______] years from the date of the initial disbursement of the Loan hereunder].

(48) [“Financial Plan” means a financial plan prepared in accordance with recognized financial reporting standards, which shall be in form and substance satisfactory to the Administrator and, in the case of the Base Case Financial Plan, shall be consistent in all respects with the projections, assumptions and all other information delivered to the Administrator pursuant to Section 3.1(j). Each Financial Plan shall include the following:

(i) a certificate executed by the Chief Financial Officer of Borrower demonstrating that the annual projected Project revenues shall be sufficient to finish construction of the Project, pay the Obligations set forth on the Loan Amortization Schedule as and when specified thereon and to comply with the financial covenants set forth in Section 6.17;

(ii) a financial model updated from the base case that shows the operation of the Project for the period from inception through the Final Maturity Date, in substantially the same form as the base case financial model previously provided to the Administrator, based on assumptions and projections regarding

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the revenues, expenses, and other financial aspects of the Project reflecting the prior experience and current status of the Project, and the expectations of the Borrower with respect to the Project, as of the most recent practicable date prior to the delivery of the model to Administrator;

(iii) for the period from the Closing Date through Completion,

(A) the current estimate of the total cost of the Project and the remaining cost to complete the Project, identifying any significant cost changes since the previous Financial Plan and discussing reasons for and implications of the cost changes;

(B) the current schedule and implementation plan for completing the Project, drawing comparisons between the current schedule and the schedule provided in the Base Case Financial Plan and the previous Financial Plan and discussing reasons for any differences; (C) current estimates and sources of funds for the Project, identifying funding changes since the previous Financial Plan and discussing reasons for and implications of those changes; (D) an updated cash flow schedule showing annual cash needs versus available revenue and funding to meet those needs and identifying any potential revenue and funding shortfalls and addressing contingency measures that will or may be taken to address any shortfalls; and (E) a written narrative report on the progress of design, permitting, acquisition and construction of the Project since the Base Case Financial Plan and the previous Financial Plan, describing all significant activities concerning Project status including any material matters that may affect the future performance of Borrower’s obligations under this Agreement; and

(iv) for the period from Completion until the Final Maturity Date, (A) an updated cash flow schedule showing annual cash inflows (Project revenues, interest and other income) and outflows (operating costs, capital costs, loan repayments, replenishment of reserves and other uses) with a written narrative identifying any potential revenue or funding shortfall and discussing contingency measures that will or may be taken to address any shortfalls; (B) an updated schedule showing actual and projected calculations of [____]6; and (C) a written narrative report explaining any variances in costs or revenues since the Base Case Financial Plan and the previous Financial Plan and describing in reasonable detail any material matters that may affect the future performance of Borrower’s obligations under this Agreement and the causes thereof to include, but not limited to, rail traffic and revenue reports, operational contracts, and third-party transactions.]

(49) “Fiscal Quarter” means any fiscal quarter of the Borrower.

(50) “Fiscal Year” means any fiscal year of the Borrower. As of the Closing Date, the Fiscal Year of the Borrower ends on [_______].

(51) “GAAP” means generally accepted accounting principles as defined by the American Institute of Certified Public Accountants or such other

6 Include reference to applicable financial covenant.

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nationally recognized professional body in effect from time to time in the United States of America.

(52) “Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state, provincial or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

(53) “Guarantor” means, collectively, the Subsidiaries of the Borrower identified as such on Schedule 4.16 and each other Subsidiary of Borrower that is required to execute a supplement to the Guaranty pursuant to Section 5.18.

(54) “Guaranty” means that certain Guaranty dated as of the date hereof executed by the Guarantors for the benefit of Lender.

(55) “Hedge Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions.

(56) “Holder” means any entity to which the Administrator transfers the Obligations or any subsequent transferee of the Obligations thereafter.

(57) “Indebtedness” of any Person means, without duplication, (i) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (ii) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (iii) all obligations of such Person upon which interest charges are customarily paid, (iv) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (v) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (vi) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (vii) all guarantees by such Person of Indebtedness of others, (viii) all Capital Lease Obligations of such Person, (ix) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty and (x) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances.

The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

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(58) “Insolvency Laws” means the Bankruptcy Code, and any state bankruptcy, insolvency, receivership or similar law now or hereafter in effect.

(59) “Investment” means any investment in any Person, whether by means of (i) the purchase or other acquisition of Equity Interests of such Person or (ii) a loan, advance or capital contribution to, guarantee or assumption of Indebtedness of, or purchase or other acquisition of any other Indebtedness or interest in, such Person. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

(60) “IRS” means the United States Internal Revenue Service.

(61) “Lender” has the meaning assigned to such term in the preamble hereto.

(62) “Lien” means any mortgage, pledge, hypothecation, assignment, mandatory deposit arrangement, encumbrance, lien (statutory or other), or preference, priority or other security arrangement of any kind or nature whatsoever, including, without limitation, any sale-leaseback arrangement, any conditional sale or other title retention agreement, any financing lease having substantially the same effect as any of the foregoing, and the filing of any financing statement or similar instrument under the UCC or comparable law.

(63) “Loan” means the extension of credit by the Lender to the Borrower pursuant to Article II.

(64) “Loan Amortization Schedule” means the Loan Amortization Schedule attached as Appendix One to the Note delivered pursuant to Section 2.1(b), as adjusted from time to time in accordance with the provisions of Section 2.4.

(65) “Loan Document” means this Agreement, the Note, the Guaranty, each Collateral Document and any other document entered into or delivered in connection therewith or that may, from time to time, be agreed in writing by the Borrower and the Administrator to constitute a Loan Document.

(66) “Loan Parties” means, collectively, the Borrower and the Guarantors.

(67) “Material Adverse Effect” means a material adverse effect on (i) the Project or the business, property, or condition (financial or otherwise) of the Borrower [and its Subsidiaries taken as a whole]; (ii) the ability of any Loan Party to perform or comply with any of its obligations under any Loan Document to which it is a party; (iii) the validity, perfection, or priority of the Liens on the Collateral in favor of the Administrator; or (iv) the rights or benefits available to the Administrator under this Agreement.

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(68) “Material Indebtedness” means Indebtedness (other than the Loan) or obligations under one or more Hedge Agreements of the Borrower or any of its Subsidiaries in an aggregate principal amount exceeding $[ ]. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or any of its Subsidiaries in respect of any Hedge Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Subsidiary, as applicable, would be required to pay if such agreement were terminated at such time.

(69) “Maximum Aggregate Principal Amount” means the maximum total amount of the Loan permitted to be drawn hereunder, which amount shall not exceed [________] Dollars ($[ ]).

(70) “Mortgage” means a mortgage, deed of trust, trust deed, deed to secure debt, leasehold mortgage or leasehold deed of trust (together with the assignments of leases and rents referred to therein) in form and substance satisfactory to the Administrator.

(71) “Mortgage Policy” has the meaning assigned to such term in Section 3.1(f)(ii).

(72) “Multiemployer Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

(73) “Net Cash Proceeds” means, with respect to any event, (i) the cash proceeds received in respect of such event including (A) any cash received in respect of any non-cash proceeds (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise, but excluding any interest payments), but only as and when received, (B) in the case of a casualty, insurance proceeds and (C) in the case of a condemnation or similar event, condemnation awards and similar payments, net of (ii) the sum of (A) all reasonable fees and out-of-pocket expenses paid to third parties (other than Affiliates) in connection with such event, (B) in the case of a sale, transfer or other disposition of an asset (including pursuant to a sale and leaseback transaction or a casualty or a condemnation or similar proceeding), the amount of all payments required to be made as a result of such event to repay Indebtedness (other than the Loan hereunder) secured by such asset or otherwise subject to mandatory prepayment as a result of such event and (C) the amount of all taxes paid (or reasonably estimated to be payable) and the amount of any reserves established to fund contingent liabilities reasonably estimated to be payable, in each case during the year that such event occurred or the next succeeding year and that are directly attributable to such event (as determined reasonably and in good faith by the Chief Financial Officer of the relevant Person).

(74) “Note” mean a note in substantially the form of Exhibit D, issued by Borrower pursuant to this Agreement to evidence the Loan disbursed hereunder.

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(75) “Obligations” means all unpaid principal of and accrued and unpaid interest (including interest which accrues during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Loan, all accrued and unpaid fees and all expenses, reimbursements, indemnities and other obligations of the Loan Parties to the Lender, the Administrator or any indemnified party arising under the Loan Documents.

(76) “Officer” means, with respect to any Loan Party, the Chairman, the Chief Executive Officer, any Vice Chairman, the President, the Treasurer, the Chief Financial Officer, the Secretary or any Senior Vice President of such Loan Party.

(77) “Organization Documents” means, (i) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (ii) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (iii) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

(78) “Outstanding Loan Balance” means the aggregate principal amount of the Loan drawn by Borrower and then outstanding, as determined in accordance with Section 2.3.

(79) “PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA.

(80) “Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time during the immediately preceding five plan years.

(81) “Permitted Investments” means (i) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of acquisition thereof, (ii) investments in commercial paper maturing within 270 days from the date of acquisition thereof and having, at such date of acquisition, the highest credit rating obtainable from Moody’s Investors Service (or any successor thereto) or Standard & Poor’s (or any successor thereto), and (iii) investments in certificates of deposit, banker’s acceptances and time deposits maturing within 180 days from the date of acquisition thereof issued or guaranteed by or placed with, and

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money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof which has a combined capital and surplus and undivided profits of not less than $[500,000,000].

(82) “Permitted Liens” means:

(i) Liens imposed by law for taxes that are not yet due or are being contested in compliance with Section 5.4;

(ii) carriers’, warehouseman’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than 30 days;

(iii) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;

(iv) deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business;

(v) judgment liens in respect of judgments that do not constitute an Event of Default under Section 7.1(k);

(vi) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary of the Borrower; and

(vii) any interest or title of a lessor or sublessor under any lease of real estate;

provided that the term “Permitted Liens” shall not include any Lien securing Indebtedness.

(83) “Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

(84) “Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of ERISA) established by the Borrower or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA Affiliate.

(85) “Principal Project Contracts” means [insert all relevant Project contracts].

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(86) “Project” means the project as defined in Exhibit B.

(87) “Rail Line” means that segment of railroad that is part of the Project, as defined in Exhibit B.

(88) “Related Parties” means, with respect to any Person, such Person’s Affiliates and the respective officials, directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.

(89) “Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30-day notice period has been waived.

(90) “Requisition” has the meaning assigned to such term in Section 2.3(a).

(91) “Secretary” means the Secretary of the Department of Transportation.

(92) [“Section 1168 of the Bankruptcy Code” means Section 1168 of the Bankruptcy Code or a successor provision intended to afford lienholders over rolling stock equipment and accessories used on such equipment benefits comparable to those afforded by said Section 1168 on the date hereof.]

(93) “Security Agreement” means that certain Security Agreement dated as of the date hereof pursuant to which the Loan Parties have pledged the personal property described therein as security for the Obligations.

(94) [“Solvent” and “Solvency” mean, with respect to any Person on any date of determination, that on such date (i) the fair value of the property of such Person is greater than the total amount of liabilities, including contingent liabilities, of such Person, (ii) the present fair salable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured, (iii) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay such debts and liabilities as they mature, (iv) such Person is not engaged in business or a transaction, and is not about to engage in business or a transaction, for which such Person’s property would constitute an unreasonably small capital, and (v) such Person is able to pay its debts and liabilities, contingent obligations and other commitments as they mature in the ordinary course of business. The amount of contingent liabilities at any time shall be computed as the amount that, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.]

(95) “STB” means the Surface Transportation Board or any successor thereto.

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(96) [“Subordinated Indebtedness” means [_______] and any other Indebtedness of any Loan Party that is subordinated to the Obligations on, and that otherwise contains, terms and conditions satisfactory to the Lender.]

(97) “Subsidiary” means, with respect to any Person (herein referred to as the “parent”), any corporation, limited liability company, partnership, association or other business entity of which more than 50% of the securities or other ownership interests having ordinary voting power is, or with respect to which the rights to control management (pursuant to any contract or other agreement or otherwise) are, at the time as of which any determination is being made, owned, controlled or held by the parent or one or more Subsidiaries of the parent or by the parent and one or more Subsidiaries of the parent.

(98) “Uncontrollable Force” means any cause beyond the control of the Borrower, including but not limited to: (i) a tornado, flood or similar occurrence, landslide, earthquake, fire or other casualty, strike or labor disturbance, freight embargo, act of a public enemy, explosion, war, blockade, terrorist act, insurrection, riot, general arrest or restraint of government and people, civil disturbance or similar occurrence, or sabotage, or an act of God (provided that the Borrower shall not be required to settle any strike or labor disturbance in which it may be involved), or (ii) the order or judgment of any Governmental Authority, if it is not also the result of willful or negligent action or a lack of reasonable diligence of the Borrower and the Borrower does not control such Governmental Authority; provided that the diligent contest in good faith of any such order or judgment shall not constitute or be construed as a willful or negligent action or a lack of reasonable diligence of the Borrower.

(99) “Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

(100) [“Unit” means [describe rolling stock included in collateral, if any].]

(101) “UCC” means the Uniform Commercial Code as in effect in the State of New York or any other State the laws of which are required to be applied in connection with the issue of perfection of security interests.

Section 1.2 Interpretation. Unless the context shall otherwise require, the words “hereto,” “herein,” “hereof” and other words of similar import refer to this Agreement as a whole. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders and vice versa. Words importing the singular number shall include the plural number and vice versa unless the context shall otherwise require. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. Unless the context shall otherwise require, references to any Person shall be deemed to include such Person’s successors and permitted assigns. Unless the context shall

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otherwise require, references to sections, subsections, provisions, schedules and exhibits are to the applicable sections, subsections and provisions of, and schedules and exhibits to, this Agreement. Unless the context shall otherwise require, all references to any resolution, contract, agreement or other document shall be deemed to include any amendments or supplements to, or modifications or restatements of, such documents that are approved in accordance with the terms thereof and hereof, and all references to any law or regulation shall refer to such law or regulation as amended, modified or supplemented from time to time. Every request, order, demand, application, appointment, notice, statement, certificate, consent or similar communication or action hereunder by any party shall, unless otherwise specifically provided, be delivered in writing in accordance with Section 8.5 and signed by a duly authorized representative of such party. All accounting terms not specifically defined herein shall be construed in accordance with GAAP[; provided that, if the Borrower notifies the Lender that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Lender notifies the Borrower that the Lender requests an amendment to any provision hereof for such purpose), regardless of whether such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith].

Section 1.3 [Continuing Default. Any reference in any Loan Document relating to a Default or an Event of Default which has occurred and is continuing (or words of similar import) shall be understood to mean (a) in the case of a Default only, that such Default has not been (i) cured or remedied before becoming an Event of Default or (ii) waived by the Lender pursuant to Section 8.14 before becoming an Event of Default and (b) in the case of an Event of Default, that such Event of Default has not been waived by the Lender pursuant to Section 8.14.]

ARTICLE II

ISSUANCE OF DEBT

Section 2.1 Issuance of Debt.

(a) Subject to the terms and conditions of this Agreement and the Act, including the payment of the Credit Risk Premium by the Borrower, the Lender agrees to make a Loan to the Borrower [on the Closing Date in a][in multiple disbursements from time to time on any Business Day during the Availability Period in an aggregate] principal amount not to exceed the Maximum Aggregate Principal Amount. Amounts repaid or prepaid may not be reborrowed.

(b) As evidence of the Borrower’s obligation to repay the Loan, the Borrower shall issue and deliver to the Lender in Washington, D.C., on or prior to the Closing Date, a Note substantially in the form of Exhibit D, having a maximum…