EQUIPMENT LEASE AGREEMENT

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EXHIBIT 10.15

EQUIPMENT LEASE AGREEMENT

(TRLI 2001-1A)

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Dated as of May 17, 2001

between

TRLI 2001-1A RAILCAR STATUTORY TRUST,

By: State Street Bank and Trust Company of Connecticut, National Association,

not in its individual capacity except as

expressly provided herein but solely as Owner Trustee,

Lessor

and

TRINITY RAIL LEASING I L.P.,

Lessee

Tank Cars, Covered Hopper Cars and Box Cars

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CERTAIN OF THE RIGHT, TITLE AND INTEREST OF LESSOR IN

AND TO THIS LEASE, THE EQUIPMENT COVERED HEREBY AND THE

RENT DUE AND TO BECOME DUE HEREUNDER HAVE BEEN ASSIGNED

AS COLLATERAL SECURITY TO, AND ARE SUBJECT TO A SECURITY

INTEREST IN FAVOR OF, LASALLE BANK NATIONAL ASSOCIATION, NOT

IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS INDENTURE TRUSTEE

UNDER A TRUST INDENTURE AND SECURITY AGREEMENT (TRLI 2001-

1A), DATED AS OF MAY 17, 2001 BETWEEN SAID INDENTURE TRUSTEE,

AS SECURED PARTY, AND LESSOR, AS DEBTOR. INFORMATION CONCERNING

SUCH SECURITY INTEREST MAY BE OBTAINED FROM THE

INDENTURE TRUSTEE AT ITS ADDRESS SET FORTH IN SECTION 20 OF

THIS LEASE. SEE SECTION 25.2 FOR INFORMATION CONCERNING THE

RIGHTS OF THE ORIGINAL HOLDER AND HOLDERS OF, THE VARIOUS

COUNTERPARTS HEREOF

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TABLE OF CONTENTS

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SECTION 1. Definitions ..........................................................................................1

SECTION 2. Acceptance and Leasing of Equipment ..................................................................1

SECTION 3. Term and Rent ........................................................................................1

Section 3.1 Lease Term .................................................................................1

Section 3.2 Basic Rent .................................................................................2

Section 3.3 Supplemental Rent ..........................................................................2

Section 3.4 Adjustment of Rent .........................................................................3

Section 3.5 Manner of Payments .........................................................................3

SECTION 4. Ownership and Marking of Equipment ...................................................................4

Section 4.1 Retention of Title .........................................................................4

Section 4.2 Duty to Number and Mark Equipment ..........................................................4

Section 4.3 Prohibition Against Certain Designations ...................................................5

SECTION 5. Disclaimer of Warranties .............................................................................5

Section 5.1 Disclaimer of Warranties ...................................................................5

Section 5.2 Rights Under Existing Equipment Subleases ..................................................6

SECTION 6. Return of Equipment; Storage .........................................................................6

Section 6.1 Return; Holdover Rent ......................................................................6

Section 6.2 Condition of Equipment .....................................................................9

SECTION 7. Liens ...............................................................................................10

SECTION 8. Maintenance; Possession; Compliance with Laws .......................................................10

Section 8.1 Maintenance and Operation .................................................................10

Section 8.2 Possession and Use ........................................................................11

Section 8.3 Sublease ................................................................................. 11

SECTION 9. Modifications .......................................................................................14

Section 9.1 Required Modifications ....................................................................14

Section 9.2 Optional Modifications ....................................................................14

Section 9.3 Removal of Property; Replacements .........................................................15

SECTION 10. Voluntary Termination ..............................................................................15

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Section 10.1 Right of Termination .....................................................................15

Section 10.2 Sale of Equipment ........................................................................17

Section 10.3 Retention of Equipment by Lessor .........................................................18

Section 10.4 Termination of Lease .....................................................................19

Section 10.5 Funding of Accounts on Termination .......................................................19

SECTION 11. Loss, Destruction Requisition, Etc .................................................................19

Section 11.1 Event of Loss ............................................................................19

Section 11.2 Replacement or Payment upon Event of Loss ................................................20

Section 11.3 Rent Termination .........................................................................22

Section 11.4 Disposition of Equipment; Replacement of Unit ............................................22

Section 11.5 Eminent Domain ...........................................................................24

SECTION 12. Insurance ..........................................................................................24

Section 12.1 Insurance ................................................................................24

Section 12.2 Physical Damage Insurance ................................................................25

Section 12.3 Public Liability Insurance ...............................................................26

Section 12.4 Certificate of Insurance .................................................................27

Section 12.5 Additional Insurance .....................................................................28

Section 12.6 Post-Lease Term Insurance ................................................................28

SECTION 13. Reports; Inspection ................................................................................29

Section 13.1 Duty of Lessee to Furnish ................................................................29

Section 13.2 Lessor's Inspection Rights ...............................................................29

SECTION 14. Lease Events of Default ............................................................................30

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SECTION 15. Remedies ...........................................................................................33

Section 15.1 Remedies .................................................................................33

Section 15.2 Cumulative Remedies ......................................................................36

Section 15.3 No Waiver ................................................................................36

Section 15.4 Notice of Lease Default ..................................................................36

Section 15.5 Lessee's Duty to Return Equipment Upon Default ...........................................36

Section 15.6 Specific Performance; Lessor Appointed Lessee's Agent ....................................37

SECTION 16. Filings; Further Assurances ........................................................................38

Section 16.1 Filings ..................................................................................38

Section 16.2 Further Assurances .......................................................................38

Section 16.3 Other Filings ........................................................................... 39

Section 16.4 Expenses ................................................................................ 39

SECTION 17. Lessor's Right to Perform ..........................................................................39

SECTION 18. Assignment .........................................................................................39

Section 18.1 Assignment by Lessor .....................................................................39

Section 18.2 Assignment by Lessee .....................................................................40

Section 18.3 Sublessee's or Others Performance and Rights .............................................40

SECTION 19. Net Lease, Etc .....................................................................................40

SECTION 20. Notices ............................................................................................42

SECTION 21. Concerning the Indenture Trustee ...................................................................43

Section 21.1 Limitation of the Indenture Trustee's Liabilities ........................................43

Section 21.2 Right, Title and Interest of the Indenture

Trustee Under

Lease..................................................................................................43

SECTION 22. Purchase Options; Renewal Options ..................................................................43

Section 22.1 Early Purchase Option ....................................................................43

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Section 22.2 Election to Retain or Return Equipment at End of Basic or

Renewal Term .................................................................................45

Section 22.3 Purchase Option ..........................................................................46

Section 22.4 Renewal Option ...........................................................................47

Section 22.5 Rent Appraisal; Outside Renewal Date .....................................................48

Section 22.6 Stipulated Loss Amount and Termination Amount During

Renewal Term .................................................................................48

Section 22.7 Deemed Renewals ..........................................................................48

Section 22.8 Funding of Accounts on Purchase ..........................................................49

SECTION 23. Limitation of Lessor's Liability ...................................................................49

SECTION 24. Investment of Security Funds .......................................................................49

SECTION 25. Miscellaneous ......................................................................................49

Section 25.1 Governing Law; Severability ..............................................................49

Section 25.2 Execution in Counterparts ............................................................... 50

Section 25.3 Headings and Table of Contents; Section References .......................................50

Section 25.4 Successors and Assigns ...................................................................50

Section 25.5 True Lease ...............................................................................50

Section 25.6 Amendments and Waivers ...................................................................51

Section 25.7 Survival ................................................................................ 51

Section 25.8 Business Days.............................................................................51

Section 25.9 Directly or Indirectly; Performance by Managers ..........................................51

Section 25.10 Incorporation by Reference ..............................................................51

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APPENDICES AND EXHIBITS

Exhibit A -- Form of Lease Supplement

Exhibit B-1 -- Form of Net Sublease

Exhibit B-2 -- Form of Full Service Sublease

Appendix A -- Definitions

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EQUIPMENT LEASE AGREEMENT

(TRLI 2001-1A)

This Equipment Lease Agreement (TRLI 2001-1A), dated as of May 17, 2001

(this "Lease"), is by and between TRLI 2001-1A Railcar Statutory Trust by State

Street Bank and Trust Company of Connecticut, National Association, not in its

individual capacity except as expressly provided herein, but solely as trustee

under the Trust Agreement, as Lessor, and Trinity Rail Leasing I L.P., a Texas

limited partnership, as Lessee.

In consideration of the mutual agreements herein contained and other

good and valuable consideration, receipt of which is hereby acknowledged, the

parties hereto agree as follows:

SECTION 1. Definitions.

Unless otherwise defined herein or required by the context, all

capitalized terms used herein shall have the respective meanings assigned to

such terms in Appendix A hereto for all purposes of this Lease.

SECTION 2. Acceptance and Leasing of Equipment.

Subject to Section 4 of the Participation Agreement, Lessor hereby

agrees to accept delivery of each Unit from Lessee and to lease such Unit to

Lessee hereunder, and Lessee hereby agrees, immediately following such

acceptance by Lessor, to lease from Lessor hereunder such Unit, such acceptance

by Lessor and lease by Lessee to be evidenced by the execution and delivery by

Lessee and Lessor of a Lease Supplement covering such Unit, all in accordance

with Section 2.3(b) of the Participation Agreement. Lessee hereby agrees that

its execution and delivery of a Lease Supplement covering any Unit shall,

without further act, irrevocably constitute acceptance by Lessee of such Unit

for all purposes of this Lease.

SECTION 3. Term and Rent.

Section 3.1 Lease Term. The basic term of this Lease (the "Basic Term")

shall commence on the Basic Term Commencement Date and, subject to earlier

termination pursuant to Section 10, 11, 15 or 22.1, shall expire at 11:59 p.m.

(Chicago, Illinois time) on the Basic Term Expiration Date. Subject and pursuant

to Section 22.4, Lessee may elect one or more Renewal Terms and, as provided in

Section 22.7 hereof, in certain circumstances a Renewal Term shall be deemed to

have occurred with respect to some or all of the Units.

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Section 3.2 Basic Rent. Lessee hereby agrees to pay Lessor Basic Rent

for each Unit throughout the Basic Term applicable thereto in consecutive

monthly installments payable on each Rent Payment Date. Each such monthly

payment of Basic Rent shall be in an amount equal to the product of the

Equipment Cost for such Unit multiplied by the Basic Rent percentage set forth

opposite such Rent Payment Date on Schedule 3-A to the Participation Agreement

(as such Schedule 3-A shall be adjusted pursuant to Section 2.6 of the

Participation Agreement). Schedule 3-B to the Participation Agreement sets forth

the Basic Rent allocated for Federal income tax purposes to each lease period

and calendar year throughout the Basic Term and in addition, sets forth that for

certain months, amounts of Basic Rent shall be allocated to the following and/or

preceding calendar year. Schedule 3-B to the Participation Agreement also sets

forth the application of Basic Rent payments to the calendar year to which such

payments relate. It is the intention of Lessor and Lessee that the allocations

of Basic Rent set forth on Schedule 3-B to the Participation Agreement

constitute specific allocations of fixed rent within the meaning of Treas. Reg.

Section 1.467-1(c)(2)(ii). Stipulated Loss Amounts and Termination Amounts have

been calculated on the basis that (i) any Basic Rents actually due on the date

of such calculation shall not be paid and (ii) any Basic Rents scheduled to have

been paid prior to the date of such calculation are assumed to have been paid

and have been appropriately reflected in such calculations. Lessor and Lessee

agree to include in income and deduct the Basic Rents allocated to each lease

period and calendar year according to Schedule 3-B of the Participation

Agreement. In addition, Lessor and Lessee intend that under no circumstances are

any Basic Rents to be considered related to (i) any period after the calendar

year succeeding the calendar year in which such Basic Rents are payable or any

period before the calendar year preceding the calendar year in which such Basic

Rents are payable or (ii) the period beginning on the Closing Date and ending on

(but not including) August 17, 2001 (the "Basic Rent Holiday").

Notwithstanding anything to the contrary contained herein or in the

Participation Agreement, each installment of Basic Rent (both before and after

any adjustment pursuant to Section 2.6 of the Participation Agreement) shall be,

under any circumstances and in any event, in an amount at least sufficient for

Lessor to pay in full as of the due date of such installment, any payment of

principal of and interest on the Equipment Notes required to be paid by Lessor

pursuant to the Indenture on such due date in accordance with the Scheduled

Amortization.

Section 3.3 Supplemental Rent. Lessee also agrees to pay to Lessor, or

to whosoever shall be entitled thereto, any and all Supplemental Rent, promptly

as the same shall become due and owing, or where no due date is specified,

promptly after demand by the Person entitled thereto, and in the event of any

failure on the part of Lessee to pay any Supplemental Rent, Lessor shall have

all rights, powers and remedies provided for herein or by law or equity or

otherwise as in the case of

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nonpayment of Basic Rent. Lessee will also pay, as Supplemental Rent, (i) on

demand, to the extent permitted by applicable law, an amount equal to Late

Payment Interest on any part of any installment of Basic Rent not paid when due

for any period for which the same shall be overdue and on any payment of

Supplemental Rent not paid when due or promptly after demanded for the period

from such due date or demand date, as applicable, until the same shall be paid

and (ii) as and when due in accordance with the Trust Indenture or the

Participation Agreement, any Make-Whole Amount payable with respect to any

Equipment Note, including, without limitation, amounts of Make-Whole Amount due

in the case of the termination of this Lease with respect to any Unit pursuant

to Section 10, in the case of the purchase of any Unit (but not in the case of a

purchase of the Beneficial Interest or if the Equipment Notes are assumed in

accordance with the Operative Agreements) pursuant to Section 22.1 or Section

6.9 of the Participation Agreement, and in the case of any refinancing of the

Equipment Notes pursuant to Section 10.2 of the Participation Agreement. All

Supplemental Rent to be paid pursuant to this Section 3.3 shall be payable in

the type of funds and in the manner set forth in Section 3.5.

Section 3.4 Adjustment of Rent. Lessee and Lessor agree that the Basic

Rent, Stipulated Loss Values, Stipulated Loss Amounts, Termination Values and

Termination Amount percentages and the Early Purchase Price shall be adjusted to

the extent provided in Section 2.6 of the Participation Agreement.

Section 3.5 Manner of Payments. All Rent (other than Supplemental Rent

payable to Persons other than Lessor, which shall be payable to such other

Persons in accordance with written instructions furnished to Lessee by such

Persons, as otherwise provided in any of the Operative Agreements or as required

by law) shall be paid by Lessee to Lessor at its office at 225 Asylum Street,

Goodwin Square, Hartford, CT, 06103, Attention: Corporate Trust Administration,

provided, that so long as the Indenture shall not have been discharged pursuant

to the terms thereof, Lessor hereby directs, and Lessee hereby agrees, that all

Rent (excluding Excepted Property) payable to Lessor shall be paid from the

Payment Account directly to the Indenture Trustee at the times and in funds of

the type specified in this Section 3.5 at the office of the Indenture Trustee at

135 S. LaSalle Street, Suite 1960, Chicago, IL 60603, ABA No. 071000505, Account

608775318, Attn: Kristine Schossow, Corporate Trust Services Division, Trust

TRLI 2001-1A, or at such other location in the United States of America as the

Indenture Trustee may otherwise direct. All Rent shall be paid by Lessee to the

recipient not later than 11:00 a.m. Chicago, Illinois time on the date of such

payment in funds consisting of lawful currency of the United States of America,

which shall be immediately available. Notwithstanding anything contained in this

Lease to the contrary, any amounts received pursuant to distribution from any of

the Accounts (as such term is defined in the Collateral Agency Agreement) shall

for all purposes hereof be deemed payment in satisfaction of the related

obligation hereunder to which such distribution relates and any failure by

Lessor, the Indenture Trustee or any Indemnified Party to receive from the

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Collateral Agent the full amount of any such distribution measured by reference

to Basic Rent, Supplemental Rent or any component thereof shall be deemed a

failure by Lessee to pay such Basic Rent or Supplemental Rent hereunder, as the

case may be.

SECTION 4. Ownership and Marking of Equipment.

Section 4.1 Retention of Title. Lessor shall and hereby does retain

full legal title to and beneficial ownership of each Unit notwithstanding the

delivery to and possession and use of such Unit by Lessee hereunder or any

Sublessee under any sublease permitted hereby.

Section 4.2 Duty to Number and Mark Equipment. With respect to the

Units to be delivered on the Closing Date, Lessee represents that Manager has

caused, and as soon as practicable after the date on which a Lease Supplement is

executed and delivered in respect of a Replacement Unit pursuant to Section

11.4(b), Lessee will cause, each Unit to be numbered with its reporting mark

shown on the Lease Supplement dated the date on which such Unit was delivered

and covering such Unit, and will from and after such date keep and maintain,

plainly, distinctly, permanently and conspicuously marked by a plate or stencil

printed in contrasting colors upon each side of each Unit, in letters not less

than one inch in height, a legend substantially as follows:

"OWNERSHIP SUBJECT TO A SECURITY AGREEMENT

FILED WITH THE SURFACE TRANSPORTATION BOARD"

with appropriate changes thereof and additions thereto as from time to time may

be required by law in order to protect Lessor's right, title and interest in and

to such Unit, its rights under this Lease and the rights of the Indenture

Trustee. Except as provided hereinabove, Lessee will not place any such Units in

operation or exercise any control or dominion over the same until the required

legend shall have been so marked on both sides thereof, and will replace

promptly any such word or words in such legend which may be removed, defaced,

obliterated or destroyed. In the event of a change in the reporting mark of any

Unit, within 60 days after a Responsible Officer of the Manager has received

notice of any such changed mark, a statement of the new reporting mark to be

substituted therefor shall be delivered by Lessee to Lessor and, so long as the

Indenture shall not have been discharged pursuant to its terms, to the Indenture

Trustee. As soon as practicable after the delivery of such statement a

supplement to this Lease and, if not so discharged, the Indenture, with respect

to such new reporting marks, shall be filed or recorded in all public offices

where this Lease and the Indenture shall have been filed or recorded and in such

other places, if any, where Lessor and, so long as the Indenture shall not have

been

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discharged pursuant to its terms, the Indenture Trustee may reasonably request

in order to protect, preserve and maintain its right, title and interest in the

Units. The costs and expenses of all such supplements, filings and recordings

shall be borne by Lessee.

Section 4.3 Prohibition Against Certain Designations. Except as above

provided, Lessee will not allow the name of any Person to be placed on any Unit

as a designation that might reasonably be interpreted as a claim of ownership;

provided, however, that, subject to the delivery of the statement of new

reporting marks specified in Section 4.2, Lessee may cause any Unit to be

lettered with the names or initials or other insignia customarily used by Lessee

or any Sublessee or any of their respective Affiliates on railroad equipment

used by it of the same or a similar type for convenience of identification of

the right of Lessee to use such Unit hereunder or any Sublessee to use such Unit

pursuant to a Permitted Sublease.

SECTION 5. Disclaimer of Warranties.

Section 5.1 Disclaimer of Warranties. Without waiving any claim Lessee

may have against any seller, supplier or manufacturer, LESSEE ACKNOWLEDGES AND

AGREES THAT (i) EACH UNIT IS OF A SIZE, DESIGN, CAPACITY AND MANUFACTURE

SELECTED BY AND ACCEPTABLE TO LESSEE, (ii) LESSEE IS SATISFIED THAT EACH UNIT IS

SUITABLE FOR ITS PURPOSES AND LESSEE HAS ACCEPTED EACH UNIT, (iii) NEITHER

LESSOR NOR OWNER PARTICIPANT IS A MANUFACTURER OR A DEALER IN PROPERTY OF SUCH

KIND OR HAS INSPECTED THE UNITS PRIOR TO DELIVERY TO AND ACCEPTANCE BY LESSEE,

(iv) EACH UNIT IS LEASED HEREUNDER SUBJECT TO ALL APPLICABLE LAWS AND

GOVERNMENTAL REGULATIONS NOW IN EFFECT OR HEREAFTER ADOPTED AND (v) LESSOR

LEASES AND LESSEE TAKES EACH UNIT "AS-IS", "WHERE-IS" AND "WITH ALL FAULTS", IN

WHATEVER CONDITION IT MAY BE, AND LESSEE ACKNOWLEDGES THAT NEITHER LESSOR, AS

LESSOR OR IN ITS INDIVIDUAL CAPACITY, NOR OWNER PARTICIPANT MAKES NOR SHALL BE

DEEMED TO HAVE MADE, AND EACH EXPRESSLY DISCLAIMS, ANY AND ALL RIGHTS, CLAIMS,

WARRANTIES OR REPRESENTATIONS EITHER EXPRESS OR IMPLIED, AS TO THE VALUE,

CONDITION, FITNESS FOR ANY PARTICULAR PURPOSE, DESIGN, OPERATION,

MERCHANTABILITY THEREOF OR AS TO THE TITLE OF ANY UNIT, THE QUALITY OF THE

MATERIAL OR WORKMANSHIP THEREOF OR CONFORMITY THEREOF TO SPECIFICATIONS, FREEDOM

FROM PATENT, COPYRIGHT OR TRADEMARK INFRINGEMENT, THE ABSENCE OF ANY LATENT OR

OTHER DEFECT, WHETHER OR NOT DISCOVERABLE, OR AS TO THE ABSENCE OF ANY

OBLIGATIONS BASED ON STRICT LIABILITY IN TORT OR ANY OTHER EXPRESS OR IMPLIED

REPRESENTATION OR WARRANTY WHATSOEVER WITH RESPECT THERETO AND EACH OF LESSOR

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AND OWNER PARTICIPANT EXPRESSLY DISCLAIMS SELECTION OF THE UNITS, except that

Lessor, in its individual capacity, represents and warrants that on the Closing

Date, Lessor shall have received whatever title to each Unit as was conveyed to

Lessor by Lessee and each Unit will be free of Lessor's Liens attributable to

Lessor and provided that the foregoing disclaimer in clause (v) shall not extend

to Owner Participant's representation and warranty contained in Section 3.5(e)

of the Participation Agreement. Lessor hereby appoints and constitutes Lessee

its agent and attorney-in-fact during the Lease Term to assert and enforce, from

time to time, in the name and for the account of Lessor and Lessee, as their

interests may appear, but in all cases at the sole cost and expense of Lessee,

whatever claims and rights Lessor may have as owner of each Unit against the

manufacturers or any prior owner thereof; provided, however, that if at any time

a Lease Event of Default shall have occurred and be continuing, at Lessor's

option, such power of attorney shall terminate, and Lessor may assert and

enforce, at Lessee's sole cost and expense, such claims and rights. Lessee's

delivery of a Lease Supplement shall be conclusive evidence as between Lessee

and Lessor that all Units described therein are in all the foregoing respects

satisfactory to Lessee, and Lessee will not assert any claim of any nature

whatsoever against Lessor based on any of the foregoing matters.

Section 5.2 Rights Under Existing Equipment Subleases. Unless a Lease

Event of Default shall have occurred and be continuing under Section 14 and

Lessor shall have given written notice to Lessee, Lessor agrees to make

available to Lessee such rights as Lessor may have, and Lessee shall be entitled

to exercise all rights of Lessor under, each Sublease.

SECTION 6. Return of Equipment; Storage.

Section 6.1 Return; Holdover Rent. (a) Not less than 180 days prior to

the end of the Basic Term or the end of any Renewal Term, if Lessee has elected

to return the Units under Section 22.2, Lessee will provide Lessor with a list

of not less than ten (10) alternative storage locations ("Storage Locations")

used for the storage of rolling stock within the Contiguous United States

sufficient to store the Units and the available storage capacities of such

locations. Unless Lessee shall have purchased the Units pursuant to Section 22

of this Lease or pursuant to Section 6.9 of the Participation Agreement, not

less than 90 days prior to the end of the Lease Term, Lessor will give Lessee

irrevocable notice of its decision either to take possession of or store the

Units. If Lessor shall have decided to take possession of the Units, the terms

of Section 6.1(b) will apply. If Lessor shall have decided to store the Units,

the terms of Section 6.1(c) will apply.

(b) Unless Lessee shall have purchased the Units pursuant to Section 22

of this Lease or pursuant to Section 6.9 of the Participation Agreement, if

Lessor shall have decided to take possession of the Units, Lessee will, at its

sole risk and expense, deliver possession of the Units at any storage location,

f.o.b. such

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location, (i) as may be agreed upon by Lessor and Lessee in writing or (ii) in

the absence of such agreement as Lessor may reasonably select by written notice

to Lessee on or before the 90th day before the end of the Lease Term; provided,

that (x) with respect to all Units being so delivered, there shall be no more

than ten (10) locations (each of which shall be located within the Contiguous

United States and shall have adequate storage capacities) and (y) Lessor's

notice shall specify the total number and type of Units to be delivered to each

location.

(c) (i) Unless Lessee shall have purchased the Units pursuant to

Section 22 of this Lease or pursuant to Section 6.9 of the Participation

Agreement, if Lessor shall have elected to store the Units upon the expiration

of the Lease Term with respect thereto, Lessee shall store the Units free of

charge and at the risk and expense of Lessee for a period (the "Storage Period")

beginning, for any particular Storage Location, on the expiration of the Lease

Term for such Units (the "Storage Period Commencement Date") and ending not more

than 60 days thereafter. On or before the 90th day before the end of the Lease

Term, Lessor shall provide Lessee with written notice designating its choices

from among the Storage Locations provided by Lessee pursuant to Section 6.1(a).

Any storage provided by Lessee during the Storage Period shall be at the sole

risk and expense of Lessee, and Lessee shall maintain the insurance required by

Section 12.1 with respect to all stored Units. During the Storage Period, Lessee

will permit Lessor or any Persons designated by it, including the authorized

representative or representatives of any prospective purchaser or user of such

Units, to restencil the marks on such Units and to inspect the same during

Lessee's normal business hours upon at least three Business Days' prior written

or telephonic notice; provided, however, that such inspection and restenciling

shall not interfere with the normal conduct of Lessee's business; and provided,

further, that (x) such inspection and restenciling shall be at such Person's own

risk and expense, (y) Lessee shall be indemnified by Lessor against any loss or

damage incurred by it in connection with any such inspection or restenciling by

such Person and (z) Lessee (except in the case of Lessee's gross negligence or

willful misconduct) shall not be liable for any injury to, or the death of, any

person exercising, either on behalf of Lessor or any prospective purchaser or

user, the rights of inspection and restenciling granted pursuant hereto. Lessee

shall not be required to store any Unit after the Storage Period. If Lessee does

store any Unit after the expiration of the Storage Period, such storage shall be

at the sole risk and expense of Lessor.

(ii) Upon the request and direction of Lessor (and at Lessor's sole

risk and expense), on not more than one occasion with respect to each stored

Unit and upon not less than 15 days' prior written notice from Lessor to Lessee,

Lessee will, on or before the expiration of the Storage Period, transport such

Unit to any railroad interchange point or points within the Contiguous United

States on any railroad lines or to any connecting carrier for shipment (with

appropriate instructions to cause such Unit to be transported to such locations

in the Contiguous United States as Lessor shall direct), whereupon Lessee shall

have no further liability or obligation with respect to such Unit.

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(iii) Upon receipt of Lessor's written notice designating its choices

from among the alternative Storage Locations provided by Lessee under Section

6.1(a), Lessee shall have the option to store such Units at such Storage

Locations as it shall choose in which case the Storage Period shall be at the

sole risk and expense of Lessee for a period of 60 days, during which period

Lessee shall be obligated to insure such Units as provided in Section 12. Upon

receipt of such notice, Lessee will promptly give notice to Lessor of the

locations at which Lessee will store such Units. If Lessee shall exercise such

option, Lessee shall on or before the expiration of the Storage Period transport

the Units to any railroad interchange point or points within the Contiguous

United States on any railroad lines or to any connecting carrier for shipment

(with appropriate instructions to cause such Units to be transported to such

locations (provided that such Units shall be transported to no more than ten

(10) locations, each having adequate storage capacity) designated by Lessor upon

not less than 15 days' prior written notice). The movement of any Unit from such

Unit's location as designated by Lessee pursuant to this Section 6.1(c)(iii) to

an interchange point thereafter designated by Lessor in accordance with the

foregoing sentence will be at the risk and expense of Lessor; provided, however,

that any incremental costs associated with movement from the storage facility

designated by Lessee pursuant to this clause (iii) over the costs that would be

incurred in movement from the storage facility designated by Lessor pursuant to

Section 6.1 (a) shall be for the account of Lessee. During any Storage Period,

Lessee shall store the Units in such manner as the Manager normally stores

similar units of railroad equipment owned or managed by it.

(d) Upon the latest of (i) expiration of the Lease Term with respect to

a Unit, (ii) tender of such Unit at the location determined in accordance with

Section 6.1(b) or, as applicable, the tender of such Unit for storage in accor-

dance with Section 6.1(c) and (iii) compliance by such Unit with Section 6.2,

this Lease and the obligation to pay Basic Rent for such Unit accruing

subsequent to the expiration of the Lease Term with respect to such Unit shall

terminate.

(e) In the event any Unit is not (i) returned to Lessor in accordance

with the provisions of Section 6.1(b) on the last day of the Lease Term with

respect thereto, or, if requested by Lessor pursuant to Section 6.1(c),

delivered and stored on such last day of the Lease Term, and, in either case, in

the condition specified in Section 6.2 or (ii) deemed automatically renewed in

accordance with the provisions of Section 22.7, the Lease with respect to such

Unit shall continue in effect and Lessee shall pay to Lessor for each such day

from the scheduled expiration of the Lease Term with respect to such Unit until

the date on which such Unit is returned to Lessor in accordance with the

provisions of Section 6.1(b) and in the condition specified in Section 6.2, an

amount equal to the daily equivalent of the average Basic Rent for the Basic

Term or the Renewal Term, as applicable, to such

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Unit. Notwithstanding the foregoing, nothing in this Section 6.1(e) shall be

construed as permitting or authorizing Lessee to fail to meet, or be construed

as Lessor consenting to or waiving any failure by Lessee to perform, Lessee's

obligation to return the Units in accordance with the requirements of this

Lease. Nothing herein shall be in abrogation of Lessor's right to terminate this

Lease under Section 15 as a result of such failure or to have such Unit returned

to it for possession or storage.

Section 6.2 Condition of Equipment. Each Unit when returned to Lessor

pursuant to Section 6.1 shall be (i) capable of performing the functions for

which it was designed, with all loading and unloading components operating in

good working order with allowance for normal wear and tear, (ii) suitable for

continued commercial use in the commodity last carried immediately prior to such

return, (iii) suitable for use in interchange in accordance with then applicable

Federal regulations, the Field Manual of the AAR, the Interchange Rules and FRA

rules and regulations, (iv) in all material respects in the condition required

by Section 8.1, (v) in conformance with any requirement pertaining to warranties

of the manufacturer of the Units during the warranty period, (vi) empty, (vii)

unless industry custom or practice indicates to the contrary, steam cleaned or

otherwise cleaned in a comparable commercially acceptable manner and (viii) free

and clear of all Liens except Lessor's Liens. All logs, records, books and other

materials, or appropriate copies of any thereof, relating to the maintenance of

such Unit shall, upon Lessor's request, be delivered to Lessor or its designee

upon the return of such Unit. Lessor shall have the right to inspect any Unit

that is returned pursuant to Section 6.1 to ensure that such Unit is in

compliance with the conditions set forth in this Section 6.2, at Lessor's sole

cost, expense and risk (including, without limitation, the risk of personal

injury or death), by its authorized representatives, during Lessee's normal

business hours and upon reasonable prior notice to Lessee; provided, however,

that Lessee shall not be liable for any injury to, or the death of, any Person

exercising, on behalf of Lessor, the rights of inspection granted under this

Section 6.2 unless caused by Lessee's gross negligence or willful misconduct;

and further provided, that if such Unit is not in compliance with the conditions

set forth in this Section 6.2, then Lessee will (i) promptly take such steps as

are necessary to bring such Unit in compliance with the conditions set forth in

this Section 6.2 and (ii) pay the reason-able cost and expense of the original

inspection of such Unit and any reinspection of such Unit conducted by Lessor

required because of such non-compliance with Section 6.2. No inspection pursuant

to this Section 6.2 shall interfere with the normal conduct of Lessee's business

or the normal conduct of any Sublessee's business, and Lessee shall not be

required to undertake or incur any additional liabilities in connection

therewith. A Unit shall not be deemed to have been returned to Lessor for

purposes of this Lease unless and until it is in compliance with the conditions

set forth in this Section 6.2.

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SECTION 7. Liens.

Lessee will not directly or indirectly create, incur, assume, permit or

suffer to exist any Lien on or with respect to any Unit or Lessee's leasehold

interest therein under this Lease, except Permitted Liens, Lessor's Liens and

Liens described in Section 6.4(a) and 6.4(b) of the Participation Agreement.

Lessee shall promptly, at its own expense, take such action or cause such action

to be taken as may be necessary to duly discharge (or bond to the reasonable

satisfaction of Lessor and Indenture Trustee) any such Lien not excepted above

if the same shall arise at any time.

SECTION 8. Maintenance; Possession; Compliance with Laws.

Section 8.1 Maintenance and Operation. (a) Lessee, at its own cost and

expense, shall maintain, repair and keep each Unit, or cause the Manager under

the Management Agreement to maintain, repair and keep each Unit, (i) according

to prudent industry practice and in all material respects, in good working

order, and in good physical condition for railcars of a similar age and usage,

normal wear and tear excepted, (ii) in a manner in all material respects

consistent with maintenance practices used by the Manager or, with respect to

any Equipment subject to an Existing Equipment Sublease that is a Net Sublease,

the applicable Sublessee, as applicable, in respect of railcars owned or managed

by the Manager or, with respect to any Equipment subject to an Existing

Equipment Sublease that is a Net Sublease, the applicable Sublessee, as

applicable, similar in type to such Unit, (iii) in accordance in all material

respects with all manufacturer's warranties in effect and in accordance with all

applicable provisions, if any, of insurance policies required to be maintained

pursuant to Section 12 and (iv) in compliance in all material respects with any

applicable laws and regulations from time to time in effect, including, without

limitation, the Field Manual of the AAR, FRA rules and regulations and

Interchange Rules as they apply to the maintenance and operation of the Units in

interchange regardless of upon whom such applicable laws and regulations are

nominally imposed; provided, however, that, so long as the Manager or, with

respect to any Equipment subject to an Existing Equipment Sublease, the

applicable Sublessee, as applicable, is similarly contesting such law or

regulation with respect to all other similar equipment owned or operated by

Manager or, with respect to any Equipment subject to an Existing Equipment

Sublease, the applicable Sublessee, as applicable, Lessee may, in good faith and

by appropriate proceedings diligently conducted, contest the validity or

application of any such standard, rule or regulation in any reasonable manner

which does not materially interfere with the use, possession, operation or

return of any of the Units or materially adversely affect the rights or

interests of Lessor and the Indenture Trustee in the Units or hereunder or

other-wise expose Lessor, the Indenture Trustee or any Participant to criminal

sanctions or release Lessee from the obligation to return the Units in

compliance with the provisions of Section 6.2; provided further, that Lessee

shall promptly notify Lessor and Indenture Trustee in reasonable detail of any

such contest. In no event shall

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Lessee discriminate in any material respect as to the use or maintenance of any

Unit (including the periodicity of maintenance or recordkeeping in respect of

such Unit) as compared to equipment of a similar nature which the Manager owns

or manages. Lessee will maintain in all material respects all records, logs and

other materials required by relevant industry standards or any governmental

authority having jurisdiction over the Units required to be maintained in

respect of any Unit, all as if Lessee were the owner of such Units, regardless

of whether any such requirements, by their terms, are nominally imposed on

Lessee, Lessor or Owner Participant.

(b) Without the written waiver or consent of Lessor (which waiver or

consent will not be unreasonably withheld), Lessee shall not change, or permit

any Sublessee to change, a DOT/AAR classification (as provided for in 49 C.F.R.

Part 179 or any successor thereto), or permit any Sublessee to operate any Unit

under a different DOT/AAR classification, from that classification in effect for

such Unit on the Closing Date, except for any change in tank test pressure

rating provided such change does not increase the pressure rating of the Unit

above the tank test pressure to which the Unit was manufactured; provided

however, that in the event Lessor shall not have provided Lessee with a written

waiver or consent to such a reclassification or operation of any Unit within 10

Business Days after receipt of Lessee's written request therefor (or Lessor

expressly rejects such a request by Lessee), Lessee may elect to replace such

Unit in accordance with and subject to the provisions of Sections 11.2(i), 11.3

and 11.4.

Section 8.2 Possession and Use. Lessee shall be entitled to the

possession of the Units and to the use of the Units by it or any Affiliate in

the United States and, subject to the remaining provisions of this Section 8.2

and Section 8.3, Canada and Mexico, only in the manner for which it was designed

and intended and so as to subject it only to ordinary wear and tear. In no event

shall Lessee use, store or permit the use or storage of any Unit in any

jurisdiction not included in the insurance coverage required by Section 12. The

Units shall be used primarily on domestic routes in the United States, and in no

event shall more than forty percent (40%) of the Units and the Other Units (as

determined by mileage records and measured annually on a calendar year basis) be

used outside the Contiguous United States at the same time. Nothing in this

Section 8.2 shall be deemed to constitute permission by Lessor to any Person

that acquires possession of any Unit to take any action inconsistent with the

terms and provisions of this Lease or any of the other Operative Agreements.

Section 8.3 Sublease. Lessee shall be entitled, without the prior

approval of Lessor, to enter into a sublease, car contract or other contract

granting permission for the use of a Unit to:

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(i) a railroad company or companies (that is not a Credit Bankrupt,

Trinity or any Affiliate of Trinity) organized under the laws of the United

States of America or any state thereof or the District of Columbia, Canada or

any province thereof, or Mexico or any state thereof, upon lines of railroad

owned or operated by such railroad company or companies or over which such

railroad company or companies have trackage rights or rights for operation of

their trains, and upon connecting and other carriers in the usual interchange of

traffic;

(ii) responsible companies (i.e., a company with which the Manager

would do business in the ordinary course of its business with respect to

railcars which it owns or manages) (other than railroad companies, Trinity,

Affiliates of Trinity or Credit Bankrupts) for use in their business; or

(iii) wholly-owned Subsidiaries of Trinity organized under the laws of

(x) Canada or any political subdivision thereof (each a "Canadian Affiliate") or

(y) Mexico or any political subdivision thereof (each a "Mexican Affiliate")

(subleases to any of such sublessees referred to in clauses (i), (ii) or (iii)

of this Section 8.3 being herein referred to as "Permitted Subleases");

provided, however, that Lessee shall not (A) sublease to a sublessee organized

under the laws of Mexico or any state thereof (a "Mexican Sublessee") if, after

giving effect to such sublease, the percentage of Units, Other Units and Pledged

Units in the aggregate (as measured by number of Units, Other Units and Pledged

Units and not mileage records) subleased to Mexican Sublessees exceeds the

lesser of (I) 7% (or, with Rating Agency Confirmation, 20%) of the Units, Other

Units and the Pledged Units in the aggregate, or (II) the percentage of railcars

leased or subleased to Mexican Sublessees in the Total Managed Fleet, and (B)

sublease more than 50 Units and Other Units to any single Mexican Sublessee

(other than (x) with Rating Agency Confirmation, to a Mexican Affiliate or (y) a

Mexican Sublessee (I) with a credit rating of at least BBB and Baa2 as

determined by S&P and Moody's, respectively (or, in the event that either S&P or

Moody's shall not or cease to provide a credit rating for such entity, a credit

rating of at least BBB or Baa2 by S&P or Moody's, as the case may be) or (II)

with a full, unconditional irrevocable guaranty from such Mexican Sublessee's

parent with a credit rating at least BBB and Baa2 as determined by S&P and

Moody's, respectively, or (III) with a letter of credit from a provider with a

credit rating at least A+ or A1 as determined by S&P and Moody's, respectively),

provided, further, that Lessee shall not at any time sublease more than 20% (or,

with Rating Agency Confirmation, 30%) of the Units and the Other Units (as

measured by number of Units and Other Units and not mileage records) in the

aggregate to Canadian Affiliates, provided, further, that any Unit subleased to

a Canadian Affiliate or a Mexican Affiliate shall be sub-subleased to Persons of

type described in clause (i) or (ii) above pursuant to a sub-sublease containing

terms and conditions similar in all material respects to the applicable sublease

between Lessee and the applicable Canadian Affiliate or Mexican Affiliate and,

provided, further, that no sub-sublease may provide greater rights to the

sub-sublessee than those provided to the sublessee in the related sublease.

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Each Sublease (and to the extent permitted, sub-sublease) other than

Existing Equipment Subleases shall include appropriate provisions so that such

sublease (i) shall require the payment of rent (x) in dollars (y) at Fair Market

Rental Value and (z) not disproportionately in the earlier term of the sublease

compared to in the later term of the sublease; (ii) shall not permit any

sub-subleasing (or in the case of any sub-sublease, any subleasing), other than

(A) sub-subleases by Canadian Affiliates or Mexican Affiliates to Persons of the

type described in clauses (i) or (ii) of the immediately preceding paragraph

containing terms and conditions similar in all material respects to the

applicable sublease between Lessee and the applicable Canadian Affiliate or

Mexican Affiliate, (B) "single trip" subleases or (C) sub-subleases by Permitted

Sublessees so long as such sub-sublease is (X) of a term of not more than one

year, (Y) subject and subordinate to the Sublease and (Z) to a sub-sublessee and

on terms such that it would be a Permitted Sublease if it were entered into

directly by the Partnership and shall not permit any sub-sub-sub leasing, (iii)

provide that the rights of the Sublessee to offset or otherwise set-off against

amounts due to Lessee from any such Sublessee under the applicable Sublease be

limited to matters arising under the Sublease (except that the Sublessee may

offset or otherwise set off amounts due to the Marks Company Trustee under the

Sublease), (iv) without regard to the payment of Basic Rent or the Lease Term,

shall not include any term or provision which is inconsistent with the terms and

conditions of this Lease or which could reasonably be expected to result in

material adverse consequences to Lessor, any Participant or the Indenture

Trustee (it being agreed that a sublease substantially in the form attached as

Exhibit B-1 or Exhibit B-2 satisfies the provisions of this sentence) and (v)

does not have a term which extends three years beyond the later of (i) the Basic

Term Expiration Date or (ii) if applicable, the end of any Renewal Term then in

effect.

Lessee will use commercially reasonable efforts to have each Sub-lease

other than Existing Equipment Subleases (i) provide that such Sublease and all

rights of the Sublessee (and of any other person claiming or who may hereafter

claim under or through the Sublessee) under such Sublease, including any

purchase options of the Sublessee thereunder, be made subject and subordinate to

the terms of this Lease and (ii) be substantially in the form attached as

Exhibit B-1 or Exhibit B-2.

Notwithstanding the foregoing, in no event shall Lessee or any of its

Affiliates be required to take any action to perfect any security interest which

any Person may have in any Sublease, other than the filing of a UCC-1 Financing

Statement against the Partnership in the jurisdiction in which the Partnership's

chief executive office is located and in the Partnership's jurisdiction of

formation covering all Subleases generally.

No sublease entered into by Lessee hereunder shall relieve Lessee of

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any liability or obligation hereunder, which shall be and remain those of a

principal and not a surety. Nothing in this Section 8.3 shall be deemed to

constitute permission to any Person in possession of any Unit pursuant to any

such sublease to take any action inconsistent with the terms and provisions of

this Lease or any of the other Operative Agreements. As used in this Section

8.3, "sublease" as a noun means a sublease, car contract or other contract

granting permission for the use of a Unit and "sublease" as a verb means to

enter into any of the foregoing.

SECTION 9. Modifications.

Section 9.1 Required Modifications. In the event a Required

Modification to a Unit is required, Lessee agrees to make such Required

Modification at its own expense; provided, however, that Lessee may, in good

faith and by appropriate proceedings diligently conducted, contest the validity

or application of any such law, regulation, requirement or rule in any

reasonable manner which does not materially interfere with the use, possession,

operation or return of any Unit or materially adversely affect the rights or

interests of Lessor or the Indenture Trustee in the Units or hereunder or

otherwise expose Lessor, the Indenture Trustee or any Participant to criminal

sanctions or relieve Lessee of the obligation to return the Units in compliance

with the provisions of Section 6.2; provided, further, that, with respect to a

Unit subject to a Full Service Sublease, the Manager, and with respect to a Unit

subject to a Net Sublease, the Sublessee, as applicable, is similarly contesting

such law, regulation, requirement or rule with respect to all other similar

equipment owned or operated by the Manager or the Sublessee, as applicable.

Title to any Required Modification shall immediately vest in Lessor.

Notwithstanding anything herein to the contrary, if Lessee, on a

non-discriminatory basis, determines in its reasonable judgment (as evidenced by

an Officer's Certificate of Lessee to such effect, confirmed by an Officer's

Certificate of the Manager) that any Required Modification to a Unit would be

economically impractical and the Manager certifies that it has made a similar

determination with respect to similar railcars in similar circumstances which

are part of the Manager's Fleet, in lieu of making the Required Modification as

provided above, Lessee may provide written notice of such determination to

Lessor in such Officer's Certificate and treat such Unit as if an Event of Loss

had occurred as of the date of such written notice with respect to such Unit and

in such event the provisions of Sections 11.2(ii), 11.3 and 11.4 shall apply

with respect to such Unit except that the amount payable under Section

11.2(ii)(a) as a result of such determination shall be an amount equal to the

greater of the Fair Market Sales Value or Stipulated Loss Amount of such Unit;

provided that there shall also be included in such Officer's Certificate a

statement of how Lessee intends to meet the financial obligations imposed under

said Sections 11.2, 11.3 and 11.4 with respect to such Units.

Section 9.2 Optional Modifications. Lessee at any time may or may

permit a Sublessee to, in its discretion and at its own or such Sublessee's cost

and

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expense, modify, alter or improve any Unit in a manner which is not required by

Section 9.1 (a "Modification"); provided that no Modification shall diminish the

fair market value, utility, capacity, residual value or remaining economic

useful life of such Unit below the fair market value, utility, capacity,

residual value or remaining economic useful life thereof immediately prior to

such Modification, in more than a de minimis respect, assuming such Unit was

then at least in the condition required to be maintained by the terms of this

Lease. Title to any Non-Severable Modification shall be immediately vested in

Lessor. Title to any Severable Modification (other than Required Modifications)

shall remain with Lessee or the Sublessee as applicable. If Lessee shall at its

cost cause such Severable Modifications (other than Required Modifications) to

be made to any Unit, Lessor shall have the right, upon 90 days prior written

notice in the case of the return of such Unit pursuant to Section 6.1, to

purchase any such Severable Modifications (other than Severable Modifications

consisting of proprietary or communications equipment) title to which is held by

Lessee at their then Fair Market Sales Value (taking into account their actual

condition). If Lessor does not so elect to purchase such Severable

Modifications, Lessee may remove such Severable Modifications at Lessee's cost

and expense, and if requested (which request shall be made by not less than 90

days prior written notice in the case of a return other than pursuant to Section

15.6) by Lessor will so remove such Severable Modifications at Lessee's cost and

expense, and Lessee shall, at its expense, repair any damage resulting from the

removal of any such Severable Modifications in a manner consistent with Section

8.1. If Lessee has not removed any Severable Modification prior to the return of

the related Unit as provided herein, title to such Severable Modification shall

pass to Lessor as of the date of such return.

Section 9.3 Removal of Property; Replacements. Lessee may, in the

ordinary course of maintenance or repair of any Unit, remove any item of

property constituting a part of such Unit, and unless the removal of such item

is required by Section 9.1 hereof, Lessee shall replace such item as promptly as

practicable by an item of property that is free and clear of all Liens (other

than Permitted Liens) and in as good operating condition as, and with a fair

market value, utility, capacity, residual value and remaining economic useful

life at least equal to, the item of property being replaced, assuming that such

replaced item was in the condition required to be maintained by the terms of

this Lease. Any item of property removed from such Unit in the ordinary course

of maintenance and repair as provided in the preceding sentence shall remain the

property of Lessor until replaced in accordance with the terms of such sentence,

but shall then, without further act, become the property of Lessee. Any

replacement property which is incorporated into a Unit in the ordinary course of

maintenance and repair shall, without further act, become the property of Lessor

and be deemed part of such Unit for all purposes hereof.

SECTION 10. Voluntary Termination.

Section 10.1 Right of Termination. Lessee shall have the right, at its

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option at any time or from time to time during the Basic Term on or after the

seventh anniversary of the Basic Term Commencement Date to terminate the Lease

with respect to any or all of the Units(provided that, if such termination is

for less than all Units in a Functional Group across the Partnership Fleet,

Lessee shall exercise such termination hereunder and under the comparable

provisions contained in the Other Lease (i) with respect to at least 50 railcars

in the aggregate of the type included in such Functional Group, (ii) no fewer

than 25 railcars of the type included in such Functional Group shall in the

aggregate remain subject to this Lease and the Other Lease, (iii) such

termination shall be made hereunder and under the Other Lease pro rata in

accordance with the number of units in such Functional Group subject to each

such lease and (iv) the determination as to which Units are subject to

termination shall otherwise be made by Lessee on a random basis without

discrimination based on maintenance status, operating condition of the Units in

question or otherwise) (the "Terminated Units") if (x) Lessee determines in good

faith (as evidenced by a certified copy of a resolution adopted by the General

Partner's Board of Directors and a certificate executed by the Chief Financial

Officer of the General Partner and the Chief Financial Officer of the Manager)

that such Units have become obsolete or surplus to Lessee's requirements, (y)

Lessor has received an Officer's Certificate from Lessee and the Manager to the

effect that there has been no discrimination in the selection of the Terminated

Units when measured against the other Units and the Manager's Fleet, and that,

following the termination of this Lease with respect to the Terminated Units,

the Units remaining subject to this Lease will constitute a pool of Units which

is of a sufficient quantity and quality to sustain over the remaining Basic Term

the Coverage Ratios applicable at the time of such termination and (z) Lessee

delivers at least 120 days' prior notice to Lessor and the Indenture Trustee (i)

specifying a proposed date of termination for such Units (the "Termination

Date"), which date shall be a Rent Payment Date, any such termination to be

effective on the Termination Date upon Lessee's compliance with this Section 10,

and (ii) if some but less than all of the Units in a Functional Group are

designated as Terminated Units, describing in such Officer's Certificate the

nondiscriminatory manner in which Lessee proposes to determine which Units in

that Functional Group are to be Terminated Units. Notwithstanding anything

herein contained to the contrary, there shall be no determination that a Unit is

surplus or obsolete for purposes of this Lease if, on the Termination Date, such

Unit is subject to a Sublease. Except as expressly provided otherwise herein,

there will be no conditions to Lessee's right to terminate this Lease with

respect to the Terminated Units pursuant to this Section 10.1. So long as (a)

Lessor shall not have given Lessee a notice of election to retain the Terminated

Units in accordance with Section 10.3 or (b) notice of prepayment of the

Equipment Notes shall not have been given pursuant to Section 2.10 of the

Indenture, Lessee may withdraw the termination notice referred to above at any

time prior to the 60th day prior to the scheduled Termination Date, whereupon

this Lease shall continue in full force and effect; provided that Lessee may not

exercise its right to withdraw a termination notice more than once annually or

more than four times during the Basic Term (irrespective of which Units are

covered thereby). Lessee

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agrees that whether or not it withdraws a termination notice it will reimburse

Lessor, each Participant and the Indenture Trustee on an After Tax Basis for all

reasonable out-of-pocket costs and expenses (including reasonable legal fees and

expenses) incurred by any thereof in connection with such termination or

proposed termination.

Section 10.2 Sale of Equipment. During the period from the date of such

notice given pursuant to Section 10.1 to the Termination Date, Lessee, as

non-exclusive agent for Lessor and, except as provided in Section 10.3, at

Lessee's sole cost and expense, shall use reasonable best efforts to obtain bids

from Persons other than Lessee or Affiliates thereof for the cash purchase of

the Terminated Units, and Lessee shall promptly, and in any event at least five

Business Days prior to the proposed date of sale, certify to Lessor in writing

the amount and terms of each such bid, the proposed date of such sale and the

name and address of the party submitting such bid. Unless Lessor shall have

elected to retain the Terminated Units in accordance with Section 10.3, on the

Termination Date: (i) Lessee shall deliver the Terminated Units (excluding any

optional Severable Modifications removed by Lessee pursuant to Section 9.2) to

the bidder (which shall not be Lessee or an Affiliate of Lessee (for the

avoidance of doubt the bidder may be a Customer, or a customer of the Manager,

and neither the Manager nor any Affiliate shall be prohibited from managing the

Units for such bidder after the purchase by such bidder)), which shall have

submitted the highest cash bid prior to such date (or to such other bidder as

Lessee and Lessor shall agree) and (ii) subject to the prior or concurrent

receipt (x) by Lessor of all amounts owing to Lessor pursuant to the next

sentence and (y) by the Persons entitled thereto of all unpaid Supplemental Rent

due on or before the Termination Date, Lessor shall, without recourse or

warranty (except as to the absence of any Lessor's Lien) simultaneously

therewith transfer all of its right, title and interest in and to the Terminated

Units to such bidder. The net proceeds of sale realized at such sale shall be

paid to and retained by Lessor and, in addition, on the Termination Date, Lessee

shall pay to Lessor (A) all Basic Rent with respect to such Terminated Units due

and payable prior to the Termination Date (exclusive of any Basic Rent due on

such date), (B) the excess, if any, of (1) the Termination Amount for the

Terminated Units computed as of the Termination Date over (2) the net cash sales

proceeds (after the deduction of all reasonable costs and expenses (including

any applicable sales, transfer or similar taxes) of Lessor and Owner Participant

in connection with such sale) of the Terminated Units, (C) an amount equal to

the Make-Whole Amount and any unpaid Late Payment Premium in respect of the

principal amount of the Equipment Notes to be prepaid in accordance with Section

2.10(a) of the Indenture and (D) all other Rent (exclusive of any Basic Rent due

on such date) then due and payable hereunder (which shall include, without

limitation, the Accumulated Equity Deficiency Amount (without duplication of

amounts calculated above) and Late Payment Interest related thereto), so that,

after receipt and application of all such payments, but without withdrawal from

any Reserve Account, Owner Participant shall be entitled under the terms of the

Collateral Agency Agreement to receive, and does receive, taking into account

all payments of Basic Rent, in respect of all such Units, the sum of the

Accumulated Equity

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Deficiency Amount and Late Payment Interest related thereto and any other

amounts then due to Owner Participant. If no sale shall have occurred, whether

as a result of Lessee's failure to pay all of the amounts hereinabove required

or otherwise, this Lease shall continue in full force and effect with respect to

such Units and Lessee agrees to reimburse Lessor, each Participant and the

Indenture Trustee for all reasonable costs and expenses (including reasonable

legal fees and expenses) incurred by any thereof in connection therewith;

provided that if such sale shall not have occurred solely because of Lessee's

failure to pay the amounts hereinabove required, Lessee shall have no further

right to terminate this Lease with respect to such Units. Lessee, in acting as

agent for Lessor, shall have no liability to Lessor for failure to obtain the

best price, shall act in its sole discretion and shall be under no duty to

solicit bids publicly or in any particular market. Lessee's sole interest in

acting as agent shall be to use its reasonable best efforts to sell the Units at

the highest price then obtainable consistent with the terms of this Lease. Owner

Participant shall have the right, but not the obligation, to obtain bids either

directly or through agents other than Lessee.

Section 10.3 Retention of Equipment by Lessor. Notwithstanding the

provisions of Sections 10.1 and 10.2, Lessor may irrevocably elect by written

notice to Lessee, not later than 60 days after receipt of Lessee's notice of

termination, not to sell the Terminated Units on the Termination Date, whereupon

Lessee shall (i) deliver the Terminated Units to Lessor in the same manner and

condition as if delivery were made to Lessor pursuant to Section 6.1(b) and

Section 6.2, and shall extend storage rights to the same extent as provided in

Section 6.1(c), treating the Termination Date as the termination date of the

Lease Term with respect to the Terminated Units and (ii) pay to Lessor, or to

the Persons entitled thereto, all Basic Rent and all Supplemental Rent due and

owing on the Termination Date and unpaid (exclusive of any Basic Rent due on

such date in respect of the Terminated Units, but inclusive of any Supplemental

Rent measured by the Make-Whole Amount and any unpaid Late Payment Interest in

respect of the Terminated Units), so that, after receipt and application of all

such payments, but without withdrawal from any Reserve Account, Owner

Participant shall be entitled under the terms of the Collateral Agency Agreement

to receive, and does receive, taking into account all payments of Basic Rent, in

respect of all such Units, the sum of the Accumulated Equity Deficiency Amount

and Late Payment Interest related thereto and any other amounts then due to

Owner Participant. On any Termination Date where Lessee is required to make

payments pursuant to the preceding sentence, Lessee shall pay as additional

Basic Rent (or Lessor shall pay as a refund of Basic Rent) an amount equal to

the Basic Rent Adjustment (or the absolute value of the negative Basic Rent

Adjustment) set forth on Schedule 4-B to the Participation Agreement for the

relevant Rent Payment Date. If Lessor elects not to sell the Terminated Units as

provided in this Section 10.3, then Lessor shall pay, or cause to be paid, to

the Indenture Trustee an amount equal to the product obtained by multiplying the

unpaid principal amount of the Equipment Notes outstanding on such date (after

deducting therefrom the

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principal installment, if any, to be paid on such date) by a fraction, the

numerator of which shall be the Equipment Cost of the Terminated Units and the

denominator of which shall be the aggregate Equipment Costs of all Units then

subject to this Lease. Upon payment by Lessor of the foregoing, Lessee shall pay

to Lessor an amount of rent equal to the Make-Whole Amount and any unpaid Late

Payment Interest in respect of the principal amount of the Equipment Notes to be

prepaid together with all Basic Rent (including Basic Rent due on the

Termination Date) and Supplemental Rent due and owing; provided that unless all

such amounts shall have been paid to the Indenture Trustee on the Termination

Date, this Lease shall continue in full force and effect. If after giving the

notice referred to above Lessor shall fail to pay the amounts required pursuant

to the third sentence of this Section 10.3 and as a result thereof this Lease

shall not be terminated with respect to the Terminated Units on a proposed

Termination Date, Lessor shall (x) thereafter no longer be entitled to exercise

its election to retain such Terminated Units and (y) reimburse Lessee for any

reasonable out-of-pocket expenses (including reasonable legal fees and expenses)

incurred by it in attempting to sell the Terminated Units pursuant to Section

10.2 immediately prior to Lessor's exercise of such preemptive election, and

Lessee may at its option at any time thereafter prior to the immediately

following Rent Payment Date submit a new termination notice pursuant to Section

10.1 with respect to such Terminated Units specifying a proposed Termination

Date occurring on a Determination Date occurring not earlier than 25 days from

the date of such notice.

Section 10.4 Termination of Lease. In the event of either (x) any such

sale and receipt by Lessor and the Indenture Trustee of all of the amounts

provided in Section 10.2 in respect of the Terminated Units or (y) retention of

the Terminated Units and full performance by Lessor and Lessee of their

respective payment obligations in compliance with Section 10.3, and upon

compliance by Lessee with the other provisions of this Section 10, the

obligation of Lessee to pay Basic Rent hereunder for such Terminated Units shall

cease and the Lease Term for the Terminated Units shall end.

Section 10.5 Funding of Accounts on Termination. Lessee will not

exercise a termination option under this Section 10 with respect to all of the

Units unless either (a) the full amount required to fund the Post Lease Term

Reserve Account is (upon consummation of such purchase and distribution of all

amounts required to be distributed by the Collateral Agent under the Collateral

Agency Agreement) and will be then available to the Collateral Agent to fund

such Post Lease Term Reserve Account or (b) an indemnity pursuant to Section

3.13 of the Collateral Agency Agreement has been provided.

SECTION 11. Loss, Destruction Requisition, Etc.

Section 11.1 Event of Loss. In the event that any Unit (i) shall suffer

damage or contamination which, in Lessee's reasonable judgment (as evidenced by

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an Officer's Certificate of Lessee to such effect, confirmed by an Officer's

Certificate of the Manager), makes repair uneconomic or renders such Unit unfit

for commercial use, (ii) shall suffer destruction which constitutes a total

loss, or shall suffer theft or disappearance (after reasonable efforts by Lessee

to locate the same) for a period exceeding 6 months (or, if earlier, the end of

the Basic Term or Renewal Term then in effect), (iii) shall be permanently

returned to the manufacturer pursuant to any patent indemnity provisions, (iv)

shall have title thereto taken or appropriated by any governmental authority,

agency or instrumentality under the power of eminent domain or otherwise or (v)

shall be taken or requisitioned for use by any governmental authority or any

agency or instrumentality thereof under the power of eminent domain or

otherwise, and such taking or requisition is for a period that exceeds the

remaining Basic Term or any Renewal Term then in effect (unless such taking or

requisition is by any governmental authority, agency or instrumentality of

Mexico or any state thereof in which case such period shall be the lesser of the

period as aforesaid or 365 days) (any such occurrence being hereinafter called

an "Event of Loss"), Lessee, in accordance with the terms of Section 11.2, shall

promptly and fully inform Lessor and the Indenture Trustee of such Event of

Loss.

Section 11.2 Replacement or Payment upon Event of Loss. Upon the

occurrence of an Event of Loss or the deemed occurrence of an Event of Loss

pursuant to Section 9.1 or an election to replace pursuant to Section 8.1(b),

Lessee shall as soon as reasonably practical and in any event within 60 days

after a Responsible Officer of the Manager shall have actual knowledge of the

occurrence of such Event of Loss or election to replace give Lessor and the

Indenture Trustee notice thereof (which initial notice shall identify the Unit

involved). Thereafter, within the 60-day period following such initial notice,

Lessee shall give Lessor and the Indenture Trustee a second notice as to which

of the following options Lessee shall elect to perform (it being agreed that,

except in the case of an election to replace pursuant to Section 8.1(b) (in

which case Lessee will comply with the provisions of Section 8.1(b)), if Lessee

shall fail to give such second notice, Lessee shall be deemed to have elected to

perform the option set forth in Section 11.2(ii)):

(i) Upon Lessee's election to perform under this clause (i) pursuant to

the above-mentioned second notice (or in the circumstances of an election

described in Section 8.1(b) with respect to any Unit), as promptly as

practicable following such election, and in any event on or before the 60th day

following such second notice (or Section 8.1(b) election), Lessee shall comply

with Section 11.4(b) and shall convey or cause to be conveyed to Lessor a

replacement unit ("Replacement Unit") to be leased to Lessee hereunder, such

Replacement Unit to be of the same car type of the same or newer model year (or

otherwise approved by Lessor, which approval shall not be unreasonably

withheld), and free and clear of all Liens (other than Permitted Liens of the

type described in clause (ii) with respect to Permitted Subleases, and in

clauses (iv) and (vii) of the definition thereof) and to have a fair market

value, utility, residual value, remaining economic useful life and condition at

least equal to the Unit so replaced (assuming such Unit was in the condition

required to be maintained by the terms of this Lease) and to be (as of the date

of conveyance)

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then subject to a currently effective Permitted Sublease having a remaining term

of not less than one year; provided, that, if only railcars of newer age or

greater value are available for such replacement, Lessee may on one occasion

re-substitute a railcar with a value closer to or equal to that of the Unit

which originally suffered the Event of Loss or was replaced (which

re-substitution shall occur within twenty-four months of the original

replacement (but in no event within the three year period immediately preceding

the Basic Term Expiration Date) and shall comply with this Section 11 as if an

Event of Loss had occurred); provided also that, if Lessee shall elect the

option under this clause (i) but shall fail to perform its obligation to effect

such replacement under this clause (i) within the 60-day period hereinabove

provided for, then (except in the case of a failure to perform an election to

replace pursuant to Section 8.1(b)) at the end of such 60-day period Lessee

shall immediately give Lessor and the Indenture Trustee notice of such failure

and specify that Lessee shall pay to Lessor on the next succeeding Rent Payment

Date that is at least 25 days after the end of such 60-day period, or in the

case of Supplemental Rent, to the Person entitled thereto, the amounts specified

in clause (ii) below as of such next succeeding Rent Payment Date, and Lessee

shall pay such amounts on such Rent Payment Date; provided further that Lessee

shall have no right to elect replacement or re-substitution under this clause

(i) if, at the time of the notice of the Event of Loss under Section 11.2 above

or at the time such replacement or resubstitution is to occur, either (A), a

Lease Default pursuant to Section 14(a), 14(b), 14(g) or 14(h) or a Lease Event

of Default shall have occurred and be continuing or (B) sufficient cash amounts

shall not have been made available to the Collateral Agent such that all amounts

then required to be applied under Section 3.4 of the Collateral Agency Agreement

in order to satisfy the amounts referred to in clauses (1) through (11) thereof,

inclusive shall have been distributed as specified thereby; or

(ii) on the Rent Payment Date which is not less than 25 days nor more

than 60 days following the date of notice of Lessee's election to perform under

this clause (ii), Lessee shall pay or cause to be paid to Lessor (or in the case

of Supplemental Rent, to the Persons entitled thereto) in funds of the type

specified in Section 3.5, (a) an amount equal to the Stipulated Loss Amount of

each such Unit suffering an Event of Loss or deemed Event of Loss determined as

of such Rent Payment Date, (b) all Basic Rent payable on such date in respect of

such Unit (exclusive of any Basic Rent due on such date in respect of the Unit

or Units suffering the Event of Loss), (c) any unpaid Late Payment Premium in

respect of the principal amount of the Equipment Notes to be prepaid in

accordance with Section 2.10(b) of the Indenture and (d) all other Rent

(exclusive of any Basic Rent due on such date in respect of the Unit or Units

suffering the Event of Loss) then due and payable hereunder (including, without

limitation, the Accumulated Equity Deficiency Amount (without duplication of

amounts calculated above) and Late Payment Interest related thereto) so that,

after receipt and application of all such payments, but without withdrawal from

any Reserve Account, Owner Participant shall be entitled under the terms of the

Collateral Agency Agreement to receive, and does receive, taking into account

all payments of Basic Rent in respect of such Unit, the sum of the Accumulated

Equity Deficiency Amount and Late Payment Interest related thereto and any other

amounts then due to Owner Participant, it being understood that until such

Stipulated

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Loss Amount and such other sums are paid, there shall be no abatement or

reduction of Basic Rent on account of such Event of Loss.

Section 11.3 Rent Termination. Upon the replacement of any Unit or

Units in compliance with Sections 11.2(i) and 11.4(b) (but only as to replaced

Units and not any Replacement Unit) or upon the payment of all sums required to

be paid pursuant to Section 11.2 in respect of any Unit or Units, the Lease Term

with respect to such Unit or Units and the obligation to pay Basic Rent for such

Unit or Units accruing subsequent to the date of payment of Stipulated Loss

Amount or date of conveyance of such Replacement Unit or Units pursuant to

Section 11.2 shall terminate; provided that Lessee shall be obligated to pay all

Rent in respect of such Unit or Units which is payable under Section 11.2 with

respect to such payment of Stipulated Loss Amount or such replacement of such

Unit or Units and in respect of all other Units then continuing to remain

subject to this Lease.

Section 11.4 Disposition of Equipment; Replacement of Unit. (a) Upon

the payment of all sums required to be paid pursuant to Section 11.2 in respect

of any Unit or Units, Lessor will convey to Lessee or its designee all right,

title and interest of Lessor in and to such Unit or Units, "as is", "where is",

without recourse or warranty, except for a warranty as to the absence of

Lessor's Liens, and shall execute and deliver to Lessee or its designee, at

Lessee's cost and expense, such bills of sale and other documents and

instruments as Lessee or its designee may reasonably request to evidence such

conveyance. As to each separate Unit so disposed of, so long as no Lease Event

of Default shall have occurred and be continuing, Lessee or its designee shall

(subject to any insurer's right of subrogation, if any) be entitled to any

amounts arising from such disposition, plus any awards, insurance or other

proceeds and damages received by Lessee, Lessor or the Indenture Trustee by

reason of such Event of Loss up to the Stipulated Loss Amount attributable

thereto and any remainder shall be divided between Lessee and Lessor, as their

respective interests may appear.

(b) At the time of or prior to any replacement of any Unit or

Replacement Unit, Lessee, at its own expense, will (A) furnish Lessor with a

Bill of Sale with respect to the Replacement Unit substantially in the form

delivered pursuant to Section 4.1(g) of the Participation Agreement, (B) cause a

Lease Supplement substantially in the form of Exhibit A hereto, subjecting such

Replacement Unit to this Lease, and duly executed by Lessee, to be delivered to

Lessor for execution by the appropriate parties, it being understood that upon

such execution (x) Lessee will cause such Lease Supplement to be filed for

recordation in the same manner as provided for the original Lease Supplement in

Section 16.1 and (y) to the extent that the Indenture has not been satisfied and

discharged, Lessor shall deliver possession of the "original" counterpart of

such Lease Supplement to the Indenture Trustee, (C) so long as the Indenture

shall not have been satisfied and discharged, cause an Indenture Supplement

substantially in the form of Exhibit A to the Indenture for such Replacement

Unit, to be delivered to Lessor and to the Indenture Trustee for execution and,

upon such execution, to be filed for recordation in the same manner and within

the same time periods as provided for the original Indenture Supplement in

Section 16.1, (D) furnish Lessor with an opinion of Lessee's counsel (which may

be the General Counsel or Assistant General Counsel of Trinity), (x) to the

effect that

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the Bill of Sale referred to in clause (A) above constitutes an effective

instrument for the conveyance of title to the Replacement Unit to Lessor, and

that legal and beneficial title to the Replacement Unit has been delivered to

Lessor and (y) describing all filings and recordings required pursuant to

Section 16 with respect to the Replacement Units, (E) furnish to Owner

Participant (and its applicable Affiliates) an agreement of Lessee to indemnify

Owner Participant (and its applicable Affiliates) against any adverse tax

consequences suffered as a result of such replacement that are not otherwise

indemnified under the Tax Indemnity Agreement, (F) furnish Lessor with an

engineer's certificate (which may be from an employee of the Manager) certifying

as to the utility, condition, model year and remaining useful life required

under clause (i) of Section 11.2, (G) furnish to Lessor and the Indenture

Trustee an Officer's Certificate certifying that the Replacement Unit has a fair

market value, utility, residual value, model year and remaining economic useful

life and condition at least equal to the Unit being replaced and is free and

clear of all Liens (other than Permitted Liens of the type described in clause

(ii) with respect to Permitted Subleases, and in clauses (iv) and (vii) of the

definition thereof), (H) furnish Lessor with an opinion from independent tax

counsel reasonably acceptable to Owner Participant to the effect that Owner

Participant should not suffer any adverse consequence as a result of such

replacement, (I) furnish Lessor with an opinion of independent transportation

counsel or in-house counsel for Manager as to the absence of Liens of record

with the STB and as to the completion of all necessary STB filings and deposits

with the Registrar General of Canada described in Section 16.1 hereof with

respect to such Replacement Unit and (J) furnish such other documents and

evidence as any Participant, Lessor or the Indenture Trustee, or their

respective counsel, may reasonably request in order to establish the

consummation of the transactions contemplated by this Section 11.4. For all

purposes hereof, (i) Lessee shall be deemed to have complied with the

requirements of this Section 11.4(b) as of the date of its delivery to Lessor,

the Participants and the Indenture Trustee of the documents and instruments

referred to in the foregoing clauses (A) through (J), signed by Lessee or its

counsel, as applicable, in due form for any required filing or recording, and

such filing or recording shall have been made if such documents and instruments

have been executed and delivered by Lessor or Indenture Trustee or both of them

in a timely manner, (ii) title to the Replacement Unit shall be deemed to have

been transferred to Lessor as of such date and (iii) upon such passage of title

thereto to Lessor the Replacement Unit shall be deemed part of the property

leased hereunder and the Replacement Unit shall be deemed a "Unit" as defined

herein. Upon such passage of title, Lessor will transfer to Lessee, "as is" and

"where is" and without recourse or warranty (except as to Lessor's Liens), all

Lessor's right, title and interest in and to the replaced Unit, and upon such

transfer, Lessor will request in writing that the Indenture Trustee execute and

deliver to Lessee an appropriate instrument releasing such replaced Unit from

the lien of the Indenture. Lessee shall pay all reasonable out-of-pocket costs

and expenses (including reasonable legal fees and expenses) incurred by Lessor,

any Participant or the Indenture Trustee in connection with any replacement

pursuant to this Section 11.4. Lessee further agrees that, upon receipt of fully

signed counterparts of the Lease Supplement and Indenture Supplement referred to

in clauses (B) and, if applicable, (C) of the first sentence of this Section

11.4(b), it will, at its sole cost and expense, cause such documents to be filed

or recorded in the manner contemplated by Section 16.1.

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Section 11.5 Eminent Domain. In the event that during the Lease Term

the use of any Unit is requisitioned or taken by any governmental authority

under the power of eminent domain or otherwise for a period which does not

constitute an Event of Loss, all of Lessee's obligations under the Operative

Agreements, including without limitation, Lessee's obligation to pay all

installments of Basic Rent, shall continue for the duration of such

requisitioning or taking. Any amount referred to in Section 11.4(a) or in

Section 12 which is payable to Lessor shall be deposited in the related

Non-Shared Payments Account established under the Collateral Agency Agreement.

SECTION 12. Insurance.

Section 12.1 Insurance. Lessee will at all times after delivery and

acceptance of each Unit, at its own expense, keep or cause the Insurance Manager

under the Insurance Agreement to keep such Unit insured with insurers of

recognized responsibility with a rating of at least A- by A.M. Best Company (or

a comparable rating by a nationally or internationally recognized rating group

of comparable stature) or by other insurers approved in writing by Lessor, which

approval shall not be unreasonably withheld, in amounts and against risks and

with deductibles and terms and conditions not less than the insurance, if any,

maintained by the Manager with respect to similar equipment which it owns or

leases, but in no event shall such coverage be for amounts or against risks less

than the prudent industry standard for companies engaged in leasing of railcars.

Without limiting the foregoing, Lessee will in any event:

(a) keep each Unit insured against physical damage (which may be

accomplished pursuant to a contingent physical damage policy) in an amount not

less than the Stipulated Loss Amount attributable thereto as shown on Schedule 4

to the Participation Agreement, subject to an aggregate limit for all Units of

not less than $1,500,000 per occurrence, provided that such coverage may provide

for deductible amounts of not more than $50,000 per occurrence; and

(b) maintain public liability insurance naming Owner Participant,

Lessor, the Trust Company, the Indenture Trustee and Loan Participant as

additional insureds (but only with respect to liability arising out of or

related to the Operative Agreements and the Units) against bodily injury, death

or property damage arising out of the use or operation of the Units with general

and excess liability limits of not less than $100,000,000 per occurrence or in

the aggregate, provided that such coverage may provide for deductible amounts

not exceeding the lesser of (w) $10,000,000 or (x) the difference (not less than

zero (0)) between (i) the level of the then current deductible maintained by

Manager for the Manager's Fleet (or if Manager, its successors and assigns is no

longer engaged in the railcar leasing business, the average level of the then

current deductible amounts maintained by the three largest companies engaged in

such business in the United States) and (ii) such amount of additional coverage

as may be obtained by Lessee in reduction of the then current deductible

maintained by Manager for an additional incremental annual premium payable by

Lessee in the aggregate in respect of the entire Partnership Fleet of up to

$100,000 as adjusted by the Inflation Factor; provided, further, that such

policies which are carried on a "claims made" basis shall provide for a

retroactive date not

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more recent than either (y) the Closing Date, or (z) a date seven years prior to

the effective date of the policy.

(c) It is understood and agreed that the insurance required under this

Section 12.1 may be part of a company-wide insurance program of the Insurance

Manager or its Affiliates, including risk-retention and self-insurance. Any

policy of insurance maintained in accordance with this Section 12.1 and any

policy purchased in substitution or replacement for any of such policies shall

provide that if any such insurance lapses or is cancelled or terminated for any

reason whatever (other than upon normal policy expiration), Lessor, the

Indenture Trustee, Loan Participant and Owner Participant shall receive 30 days'

prior written notice of such lapse, cancellation or termination.

(d) If Lessee or the Insurance Manager shall maintain any liability

coverages for the benefit of Lessee in excess of the coverages required

hereunder (whether or not such excess coverage complies with the requirements

under this Section 12), Lessee will cause all such coverages to name Owner

Participant, Lessor, the Trust Company, the Indenture Trustee and Loan

Participant as additional insureds (but only with respect to liability arising

out of or related to the Operative Agreements or the Units), provided, however,

that, the requirements of this Section 12 shall not otherwise apply to such

coverages.

Section 12.2 Physical Damage Insurance. (a) The insurance maintained

pursuant to Section 12.1(a) shall provide that (i) so long as the Equipment

Notes remain outstanding, the proceeds up to the Stipulated Loss Amount for any

loss or damage to any Unit shall be paid to the Indenture Trustee under a

standard loss payable clause, and thereafter to Lessor and (ii) so long as no

Lease Event of Default shall have occurred and be continuing, Lessee will be

entitled, at its own expense, to make all proofs of loss and/or take all other

steps necessary to collect the proceeds of such insurance.

(b) In lieu of maintaining the physical damage insurance required by

Section 12.1(a), Lessee may self-insure with respect to the Units for such

amounts and against such risks as shall be consented to by Lessor and the

Indenture Trustee, which consent shall be based upon reasonable practices then

in effect in the railcar leasing and insurance industries and upon the financial

condition of Lessee taking into account Lessee's capital structure and that

Lessee is a special purpose corporation.

(c) The entire proceeds of any property insurance or third party

payments for damages to any Unit received by Lessor or the Indenture Trustee

shall be held by such party until, with respect to such Unit, the repairs

referred to in clause (i) below are made as specified therein or payment of the

Stipulated Loss Amount is made, and such entire proceeds will be paid, so long

as no Lease Event of Default shall have occurred and be continuing, either:

(i) to Lessee promptly following receipt by the Indenture Trustee

or Lessor, as the case may be, of a written application signed

by Lessee for payment to Lessee for repairing or restoring the

Units which have been damaged so long as (1) Lessee

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shall have complied with the applicable provisions of this

Lease, and (2) Lessee shall have certified that any damage to

such Units shall have been fully repaired or restored; or

(ii) if this Lease is terminated with respect to such Unit because

of an Event of Loss and Lessee has paid the Stipulated Loss

Amount and all other amounts due as a result thereof, such

proceeds shall be promptly paid over to, or retained by,

Lessee.

Section 12.3 Public Liability Insurance. (a) The public liability

insurance referred to in paragraph 12.1(b) shall (i) provide that in as much as

such policies cover more than one insured, all terms, conditions, insuring

agreements and endorsements, with the exception of limits of liability,

deductibles or retentions and liability for premiums, commissions, assessments

or calls (which shall be solely a liability of Lessee), shall operate in the

same manner as if there were a separate policy or policies covering each

insured, (ii) waive any rights of subrogation of the insurers against Owner

Participant, Lessor, the Trust Company, the Indenture Trustee, and Loan

Participant (iii) provide that neither Owner Participant, Lessor, the Trust

Company, the Indenture Trustee nor Loan Participant shall have any

responsibility for any insurance premiums, whether for coverage before or after

cancellation or termination of any such policies as to Lessee and (iv) be

primary without contribution from any similar insurance maintained by Owner

Participant, Lessor, the Trust Company, the Indenture Trustee or Loan

Participant.

(b) Lessee shall use its reasonable efforts to obtain public liability

insurance policies which stipulate that coverage thereunder will not be

invalidated (as to Owner Participant, Loan Participant, Lessor, as Lessor of the

Units and in its individual capacity, and the Indenture Trustee) by any act or

neglect of Lessee, or any breach or violation by Lessee of any warranties,

declarations or conditions contained in such policies, but shall be under no

obligation to obtain such policies containing such stipulations if they are not

available to Lessee at commercially reasonable rates in the markets in which

Lessee has then placed its insurance program.

(c) In the event any public liability insurance policy or coverage

thereunder which are required to be maintained under Section 12.1(b) shall not

be available to Lessee in the commercial insurance market on commercially

reasonable terms, Lessor shall not unreasonably withhold its agreement to waive

such requirement. Lessee shall make written request for any such waiver in

writing, accompanied by written reports prepared, at Lessee's option, either by

(i) one independent insurance advisor chosen by Lessee and Lessor or (ii) three

independent insurance advisors, one chosen by Lessor, one chosen by Lessee and

one chosen by the other two advisors (one of which may be the regular insurance

broker or brokers of Lessee). The fees and expenses of all such advisors shall

be paid by Lessee. The written reports required hereunder shall (x) state that

such insurance (or the required coverage thereunder) is not reasonably available

to Lessee at commercially reasonable premiums in the commercial insurance

markets within which Lessee or the Manager normally purchases its insurance from

insurers, acceptable to Lessee, with a Best's rating of A- or better for

railcars of similar type and capacity and (y) explain in detail the basis for

such conclusions. Upon the granting of any such waiver, Lessee shall within 15

days thereafter certify to Lessor in writing the cost (on the basis of the

Manager's Fleet) of liability

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insurance premiums for the coverage required by Section 12.1 (b) for the

immediately preceding fiscal year; and in the event that any such certificate is

not received by Lessor within such 15-day period, any such waiver shall be

deemed revoked. At any time after the granting of such waiver, but not more

often than once a year, Lessor may make a written request for a supplemental

report (in form reasonably acceptable to Lessor) from such insurance advisor(s)

updating the prior report and reaffirming the conclusions set forth therein.

Lessee shall provide any such required supplemental report within 60 days after

receipt of the written request therefor. Any such waiver shall be effective for

only as long as such insurance is not reasonably available to Lessee in the

commercial markets in which Lessee normally purchases its insurance at

commercially reasonable rates, it being understood that the failure of Lessee to

furnish timely any such supplemental report shall be conclusive evidence that

such condition no longer exists. If such supplemental report shows that such

coverage is available, Lessee shall within 90 days of such report obtain such

insurance coverage. During any period with respect to which such waiver has been

granted and remains in effect under this Section 12.3(c), Lessee shall obtain

public liability insurance as set forth in Section 12.1(b) from such carriers,

in such amounts and with coverage limits and deductibles as may be reasonable in

its judgment under the circumstances, but in any event (i) no less than prudent

industry standards and (ii) in an amount that may be purchased for a premium

equal to 200% of Lessee's cost (on a fleet-wide basis) of public liability

insurance premiums for the coverage on a fleet-wide basis required by Section

12.1(b) for the final year immediately preceding the fiscal year in which such

waiver first was granted.

Section 12.4 Certificate of Insurance. (a) Lessee shall, prior to the

Closing Date and when the renewal certificate referred to below is sent (but in

any event not less than annually), furnish (or, in the case of (iii) below, use

reasonable efforts to furnish) Lessor, the Indenture Trustee, Owner Participant

and the Loan Participant with a certificate signed by the insurer or an

independent insurance broker (i) showing the insurance then maintained by Lessee

pursuant to Section 12.1, (ii) stating that, except as noted in such

certificate, such insurance complies with the requirements contained in Exhibit

B-1 (as to public liability insurance) and/or B-2 (as to physical/damage

insurance) to the Participation Agreement, (iii) stating that, except as noted

in such certificate, such insurance complies with the requirements contained in

this Section 12 and (iv) to the extent that any provision that Lessee is

required to use reasonable efforts to obtain is not contained in such insurance,

such certificate shall so state and shall confirm that, in such broker's

opinion, such provision is not reasonably obtainable. Lessor shall be entitled

at its expense to review copies of all applicable insurance policies. With

respect to any renewal policy or policies, certificates or binders evidencing

such renewal shall be furnished as soon as practicable, but in no event later

than 30 days after the earlier of the date such renewal is effected or the

expiration date of the original policy or policies. Simultaneously, with the

furnishing of such certificate, Lessee will provide appropriate evidence,

reasonably satisfactory to Lessor and the Indenture Trustee, that all premiums

due on such insurance have been paid.

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(b) Lessee agrees to use reasonable efforts to cause each of its

insurers to agree that, with respect to any policy of insurance maintained

pursuant to Section 12.1, such insurer will provide not less than 30 days' prior

written notice to Lessor, the Indenture Trustee, Loan Participant and Owner

Participant of any non-renewal or material adverse change with respect to such

policy. For purposes of this Section 12.4(b), "material adverse change" shall

mean a material adverse change in policy limits, exclusions or deductibles or

any material adverse change in policy coverage inconsistent with the

requirements of Section 12.1(b). If any of Lessee's insurers delivers such

notice of non-renewal, Owner Participant may attempt to obtain and provide

satisfactory insurance and Lessee shall reimburse Owner Participant for

reasonable and prudent expenses incurred (i) during the period 10 days prior to

expiration of existing insurance policies, for all Owner Participant's expenses

excluding broker fees and commissions and insurance premiums, and (ii) on and

after the expiration of existing insurance policies, for all Owner Participant's

expenses including broker fees and commissions and insurance premiums.

Section 12.5 Additional Insurance. In the event that Lessee shall fail

to maintain insurance as herein provided in Section 12.1 or, if applicable,

Section 12.3, Lessor may at its option, upon prior written notice to Lessee,

provide such insurance and, in such event, Lessee shall, upon demand from time

to time reimburse Lessor for the cost thereof together with interest from the

date of payment thereof at the Late Rate, on the amount of the cost to Lessor of

such insurance which Lessee shall have failed to maintain. If after Lessor has

provided such insurance, Lessee then obtains the coverage provided for in

Section 12.1 which was replaced by the insurance provided by Lessor, and Lessee

provides Lessor with evidence of such coverage reasonably satisfactory to

Lessor, Lessor shall cancel the insurance it has provided pursuant to the first

sentence of this Section 12.5. In such event, Lessee shall reimburse Lessor for

all costs to Lessor of cancellation, including without limitation any short rate

penalty, together with interest from the date of Lessor's payment thereof at the

Late Rate. In addition, at any time Lessor (either directly or in the name of

Owner Participant) may at its own expense carry insurance with respect to its

interest in the Units, provided that such insurance does not interfere with

Lessee's ability to insure the Units as required by this Section 12 or adversely

affect Lessee's insurance or the cost thereof, it being understood that all

salvage rights to each Unit shall remain with Lessee's insurers at all times.

Any insurance payments received from policies maintained by Lessor pursuant to

the previous sentence shall be retained by Lessor without reducing or otherwise

affecting Lessee's obligations hereunder, other than with respect to Unit(s)

with respect to which such payments have been made.

Section 12.6 Post-Lease Term Insurance. Lessee agrees that upon the

expiration or earlier termination of the Lease Term, Lessee will, with respect

to the public liability insurance otherwise required to be carried under this

Section 12,

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either: (A) purchase a seven year extended reporting period for Owner

Participant, Lessor and Owner Trustee, or (B) obtain the written agreement of

the Manager in form and substance satisfactory to Owner Participant to carry or

cause to be carried for such seven year period public liability insurance which

satisfies the requirements of this Section 12 and which names Owner Participant,

Lessor, the Collateral Agent and Owner Trustee as additional insureds.

SECTION 13. Reports; Inspection.

Section 13.1 Duty of Lessee to Furnish. On or before July 31, 2001, and

on or before each July 31 thereafter, Lessee will furnish (or cause the Manager

under the Management Agreement to furnish) to Lessor, Owner Participant, Loan

Participant, the Indenture Trustee and the Rating Agency an accurate statement,

as of the preceding March 31, (a) showing the amount, description and reporting

marks of the Units then leased hereunder, the amount, description and reporting

marks of all Units that may have suffered an Event of Loss during the 12 months

ending on such March 31 (or since the Closing Date, in the case of the first

such statement), and such other information regarding the condition or repair of

the Units as Lessor may reasonably request, (b) stating that, in the case of all

Units repainted during the period covered by such statement, the markings

required by Section 4.2 hereof shall have been preserved or replaced, (c)

showing the percentage of use in the United States and in each of Canada and

Mexico based on the total mileage traveled by all railcars in the Total Managed

Fleet (or by the Units, if and to the extent generally made available to the

Manager in the ordinary course with respect to railcars in general interchange

service similar to the Units) for the prior calendar year as reported to the

Manager by railroads (provided, that Lessee shall cooperate with Owner

Participant and Lessor and shall provide such additional information on such

matters as Owner Participant or Lessor may reasonably request to enable Owner

Participant and Lessor to pursue or fulfill their respective tax audit and tax

litigation rights and obligations) and (d) stating that Lessee is not aware of

any condition of any Unit which would cause such Unit not to comply in any

material respect with the rules and regulations of the FRA and the interchange

rules of the Field Manual of the AAR as they apply to the maintenance and

operation of the Units in interchange and any other requirements hereunder.

Section 13.2 Lessor's Inspection Rights. Lessor, Owner Participant and

the Indenture Trustee each shall have the right, but not the obligation, at

their respective sole cost and expense, unless a Lease Event of Default shall

have occurred and be continuing, by their respective authorized representatives,

to inspect the Units, all subleases thereof and Lessee's records with respect

thereto. All inspections shall be conducted during Lessee's nor