Exhibit 99.1
TRINITY INDUSTRIES LEASING COMPANY
RAILROAD CAR LEASE AGREEMENT
This
Agreement, made this 5 th day of
November, 2007, between Trinity Industries Leasing Company ,
a Delaware corporation, with its principal office at 2525 Stemmons
Freeway, Dallas, Texas 75207, (hereinafter called
“Lessor”) and First United Ethanol, LLC , a
Georgia limited liability company, with its principal office at 2
West Broad Street, Camilla, Georgia 31730 (hereinafter called
“Lessee”).
In
consideration of the mutual terms and conditions hereinafter set
forth, the parties hereto hereby agree as follows:
ARTICLE 1: LEASE AGREEMENT
Lessor agrees
to lease to Lessee, and Lessee agrees to lease from Lessor, the
cars shown on each Rider hereto and such additional Riders as may
be added from time to time (each such Rider and together with this
Agreement shall be collectively referred to as the
“Lease”) by agreement of the parties and signed by
their duly authorized representative (all such cars being
hereinafter referred to as the “cars”). Each Rider
shall set forth a brief description of the car or cars covered
thereby, including such facts as the number of cars, the AAR or DOT
specifications, rental charges, term throughout which the car or
cars shall remain in Lessee’s service and such other
information as may be desired by both parties. Lessor and Lessee
agree that each Rider hereto shall constitute a separate Lease
which incorporates the terms of this Agreement. Each Rider shall be
severable from any other cars or riders relating to this Agreement
and shall become a separate lease which is separately transferable
for all purposes. It is the intent of alt parties to this Agreement
to characterize this Agreement as a true lease.
ARTICLE 2: DELIVERY
Lessor agrees
to deliver each car to Lessee, freight charges collect, in the yard
of the delivering line at the point specified by the Lessee, and
Lessee agrees to accept such delivery. The obligations of the
Lessor to deliver the cars shall be excused, and Lessor shall not
be liable, for any causes beyond the reasonable control of Lessor
(including, but not limited to, delays caused by fire, labor
difficulties, delays of carriers and materials suppliers,
governmental authority, late delivery by the manufacturer of the
cars or late delivery by a prior lessee) and, in the event of a
delay in such delivery, Lessor shall deliver the cars to Lessee as
soon as reasonably possible thereafter.
ARTICLE 3: CONDITION OF CARS — ACCEPTANCE
All cars
delivered under this Lease shall be in satisfactory condition for
movement in the normal interchange of rail traffic and shall
otherwise comply with the description and specifications contained
in the applicable Rider; but Lessee shall be solely responsible for
determining that cars are in proper condition for loading and
shipment, except for those responsibilities which, under applicable
law, have been assumed by the railroads. Lessee shall inspect the
cars promptly after they are delivered and shall notify Lessor in
writing within five days after delivery of its rejection of any
car, and the specific reasons for such rejection. Failure by the
Lessee to inspect the cars within five days after delivery, and/or
the successful loading of any car by Lessee, shall constitute
acceptance of such car or cars, as the case may be, by Lessee and
shall be conclusive evidence of the fit and suitable condition of
such car or cars. At Lessor’s request, Lessee shall deliver
to Lessor an executed Certificate of Acceptance in the form of
Exhibit A with respect to all cars.
If Lessee
rejects any car, Lessor shall have the right to have the rejected
car inspected by an inspector acceptable to both Lessor and Lessee.
The cost of such inspection will be paid by Lessor if the cause for
rejection is affirmed by the inspector, otherwise such cost will be
borne by Lessee. The Lessee shall be deemed to have accepted any
car for which the inspector determines that good cause for
rejection did not exist. The decision of the inspector shall be
final and binding upon the parties.
Lessee’s
acceptance, however affected, shall be deemed effective as of the
delivery date and the monthly rentals as hereinafter set forth
shall accrue from the delivery date. Such acceptance shall
conclusively establish that such cars conform to the applicable
standards set forth in the Rider(s) and the Interchange
Rules.
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ARTICLE 4: RENTALS
Lessee agrees
to pay to Lessor for the use of each car the monthly rental set
forth in the Rider applicable to such car from the date such car is
delivered to Lessee until such car is returned to Lessor, as
hereinafter provided in Article 18. The rental shall be
payable in U.S. Dollars and in advance on or before the first day
of each calendar month (provided, however, that the rental for each
car for the month in which it is delivered shall be prorated for
the number of days, including the day of delivery, remaining in
such month at a daily rate based upon a 365 day year and shall
be payable on or before the first day of the next succeeding month)
to Lessor by electronic funds transfer to Trinity Leasing
Customer Payment Account, Wilmington Trust Company, ABA #
031-100-092 Account # 2860-4998, or at such other
address as Lessor may specify by notice to Lessee. Except as set
forth in this Lease (including without /imitation, the provisions
of Article 11) rental shall be paid without deduction, set-off
or counterclaim.
ARTICLE 5: MILEAGE ALLOWANCE
Lessor shall
collect all mileage earned by the cars during the lease term and
shall credit to the rental of Lessee, such mileage earned by the
cars while in the service of Lessee, as and when received from the
railroads according to, and subject to, all rules of the tariffs of
the railroads, but only to the extent of the aggregate rental
charges payable for the duration of the lease term.
ARTICLE 6: TERM
This Lease
shall be effective as dated and will expire upon the completion of
the leasing arrangement shown on the attached Riders of the last
car or cars covered hereunder. The Lease term, with respect to all
cars covered by a particular Rider, shall commence on the average
date of delivery of the cars covered by such Rider; and shall
terminate as specified in such Rider, unless sooner terminated in
accordance with provisions of this Lease.
ARTICLE 7: USE AND POSSESSION
Throughout the
continuance of this Lease so long as Lessee is not in default under
this Lease, Lessee shall be entitled to possession of each car from
the date the lease becomes effective as to such car; and shall use
such car only in the manner for which it was designed and intended,
and so as to subject it only to ordinary wear and tear, and on its
own property or lines in the usual interchange of traffic;
provided, however, that Lessee agrees that the cars shall at all
times be used: (a) in conformity with all Interchange Rules;
(b) in compliance with the terms and conditions of this Lease;
(c) predominantly in the continental limits of the United
States, provided however, in no event shall more than forty percent
(40%) of the cars (as determined by mileage records and measured
annually on a calendar year basis) be used outside of the
contiguous United States at the same time.
In the event
any car is used outside of the continental United States, for any
reason whatsoever, Lessee shall assume full responsibility for all
costs, taxes, duties or other charges incidental to such use
including costs incurred in returning car to the continental United
States.
ARTICLE 8: EMPTY MILEAGE INDEMNIFICATION
Lessee agrees
that it will use its best efforts to so use the cars that their
total mileage under load will equal or exceed their mileage empty
on each railroad over which the cars move. Should the empty mileage
exceed the loaded mileage, Lessee shall pay to Lessor for such
excess at the rate and at the time established by the tariff of the
railroad on which such excess of empty miles has accrued. For the
purpose of this paragraph, the railroad mileage reports received by
Lessor shall be prima facie evidence of the facts reported
therein.
ARTICLE 9: ADDITIONAL CHARGES BY RAILROADS
Lessee agrees
to use the cars, upon each railroad over which cars shall move, in
accordance with the then prevailing tariffs to which each railroad
shall be a party; and if the operation or movements of any of the
cars during the term hereof shall result in any charges being made
against Lessor by any such railroad, Lessee shall pay to Lessor the
amount of such charges within the period prescribed by and at the
rate and under the conditions of the then prevailing tariffs.
Lessee agrees to indemnify Lessor against any such charges, and
shall be liable for any switching, demurrage, track storage,
detention or special handling charges imposed on any car during the
term hereof.
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ARTICLE 10: LESSEE’S RIGHT TO TRANSFER OR
SUBLEASE
Lessee shall
not transfer, sublease or assign any car or its interests and
obligations pursuant to the Lease, nor shall a transfer, sublease
or assignment by operation of the law or otherwise of
Lessee’s interest in the cars or this Lease be effective
against Lessor without Lessor’s prior written consent, which
shall not be unreasonably withheld or denied. No transfer, sublease
or assignment of the Lease, or of any car, shall relieve Lessee
from any of its obligations to Lessor under this Lease.
Notwithstanding the foregoing paragraph, Lessee shall have the
right to sublease any of the cars for single trips to its customers
or suppliers, and to cause each car so subleased to be boarded or
placarded with the name of the sublessee in accordance with the
provisions of the demurrage tariffs lawfully in effect, where the
sole purpose of such subleasing is to obtain an exemption from
demurrage for said cars so subleased; provided, however, that
notwithstanding any such sublease, Lessee shall continue to remain
liable to Lessor for the fulfillment of Lessee’s obligations
under this Lease; and providing further, that Lessor shall have the
right, at any time, to withdraw the privilege of subleasing
hereinabove granted to Lessee.
ARTICLE 11: MAINTENANCE RESPONSIBILITY
Lessor agrees
to maintain the cars in good condition and repair according to the
Interchange Rules of the Association of American Railroads (AAR).
Lessee agrees to notify Lessor promptly when any car is damaged or
in need of repair, and to forward such cars and any other cars
subject to this Lease to shops as directed by Lessor for repairs
and/or periodic maintenance and inspections. No repairs to any of
the cars shall be made by Lessee without Lessor’s prior
written consent, except that Lessee shall, at its expense, replace
any removable part (dome covers, hatch covers, outlet caps, etc.)
if lost or broken. Replacement or repair by Lessee of any parts,
equipment and/or accessories on any of the cars shall be with
parts, equipment and/or accessories that are of like kind and of at
least equal quality to those being replaced or repaired, unless
otherwise agreed in writing by Lessor.
On tank cars,
Lessee agrees that it will assume the responsibility for the
maintenance and replacement of angle valves and check valves and,
if such cars are so equipped, thermometer wells, gauging devices,
regulator valves, safety heads and top unloading valves.
On hopper
cars, Lessee will be responsible for inspection and cleaning of the
operating mechanisms of the outlets, hatches and special fittings
on such cars leased herein. Further, any damage to such outlets,
hatches, special fittings or the operating mechanisms will be
repaired for the account of the Lessee.
When a car is
placed in a private shop for maintenance or repair, the rental
charges shall cease on date of arrival in the shop, except in the
case where a car arrives without advance notice of defects from
Lessee, in which case rental charges will cease on communication of
such notice of defects to Lessor from Lessee, and shall be
reinstated on the date that the car is forwarded from the shop or
on the date that the car is ready to leave, awaiting disposition
instructions from Lessee. If any repairs are required as a result
of the misuse by or negligence of Lessee or its consignee, agent or
sublessee or while on a railroad that does not subscribe to, or
fails to meet its responsibility under the Interchange Rules of the
AAR, or while on any private siding or track or any private or
industrial railroad, the rental charges shall continue during the
repair period, and Lessee agrees to pay Lessor for the cost of such
repairs.
ARTICLE 12: LOSS OR DESTRUCTION
If any of the
cars shall be completely destroyed, or if the physical condition of
any car shall become such that the car cannot be operated in
railroad service, as determined by the parties, then Lessor may, at
its option, cancel this Lease as to such car as of the date on
which such event occurred, or may substitute another car within a
reasonable period of time. Lessee shall notify Lessor of the
occurrence of any such event within two (2) days of such
event. In the event of such substitution, the substituted car shall
be held pursuant to all the terms and conditions of this Lease.
Lessee agrees that if a car is lost or destroyed or is in such
physical condition that it cannot be operated in railroad service
by reason of misuse or negligence of Lessee or its consignee, agent
or sublessee or while on a railroad that does not subscribe to the
AAR Interchange Rules or while on any private siding or track or
any private or industrial railroad, Lessee will pay Lessor, in
cash, the settlement value of such car as determined by Rule #107
of the AAR Interchange Rules within ten (10) days following a
request by Lessor for such payment. Lessor and Lessee shall
cooperate with and assist each other in any reasonable manner
requested, but without affecting their respective obligations under
this Article or Article 22, to establish proper claims against
parties responsible for the loss, destruction of or damage to, the
cars.
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ARTICLE 13: LOSS OF COMMODITY
Lessor shall
not be liable for any loss of, or damage to, commodities or any
part thereof, loaded or shipped in the cars however such loss or
damage shall be caused or shall result. Lessee agrees to assume
responsibility for, to indemnify Lessor against, and to save it
harmless from any such loss or damage or claim therefor.
ARTICLE 14: DAMAGE TO CAR BY COMMODITY
Notwithstanding the exception for ordinary wear and tear in
Article 18, if during the term of any Rider any of the Cars or
any components or appurtenances thereto shall be unduly and
materially damaged, destroyed or depreciated in value or condition
due to the corrosive or other damaging effect of any substance
carried therein or thereon (whether or not such damage was
foreseeable), Lessee will reimburse Lessor promptly for such
damage, loss or expense suffered by Lessor as a consequence
thereof.
ARTICLE 15: ALTERATION AND LETTERING
Lessee will
preserve the cars in good condition and will not in any way alter
the physical structure of the cars without the advance approval, in
writing, of the Lessor. Lessee shall place no lettering or marking
of any kind upon the cars without Lessor’s prior written
consent, provided however, that Lessee may cause said cars to be
stenciled, boarded, or placarded with letters not to exceed two
inches (2”) in height to indicate to whom the cars are leased
and with commodity stencils per AAR or DOT specifications.
ARTICLE 16: LININGS AND COATINGS
The
application, maintenance and removal of interior protective linings
and coatings in cars so equipped is to be at the expense of the
Lessee unless otherwise specified on the Rider. Commodity or
mechanical damage to such linings or coatings shall be for the
account of the Lessee.
ARTICLE 17: INTERIOR PREPARATION FOR COMMODITIES
Subsequent to
Lessee acceptance, any cleaning or special preparation of the
interior of cars to make them suitable for the shipment of
commodities by or for Lessee during the term of the lease shall be
done at Lessee’s expense unless otherwise agreed.
ARTICLE 18: RETURN OF CARS — CLEANING
At the
expiration of the lease term as provided in the Riders, Lessee
shall, at its expense, return the cars to Lessor at the location
and to the agent selected by the Lessor empty, clean and free from
residue, and in the same good condition as the cars were in when
delivered, except for normal wear and tear. At the expiration,
should car cleaning be required, the Lessee shall bear the full
cost of cleaning and the rental shall continue until the car is
clean.
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ARTICLE 19: MODIFICATIONS
Lessor and Lessee agree that if, at any time after the effective
date of any Rider, changes in car design or equipment are required
by the AAR, DOT, FRA or any other governmental authority, Lessor
may, at its option, perform all modifications so ordered and that
the cost of those modifications shall be reflected in an increase
in the monthly rental rate per car according to the rental
escalation formula shown on the Rider for that car.
ARTICLE 20: HIGH MILEAGE AND WEIGHT LIMITATION
Since the
rentals and other terms of this Lease are based on normal usage of
cars in non-unit train or other non-high mileage operations, Lessee
agrees not to use cars in unit train or other designated high
mileage usage without prior written consent of Lessor. Each car is
limited to the number of total loaded and empty miles per calendar
year shown on the Rider and is subject to a surcharge also shown on
the Rider for all excess miles.
Lessee shall
not exceed the weight limitations prescribed for operation of cars
in unrestricted interchange service as set forth under Interchange
Rule 70 without Lessor’s prior written consent.
ARTICLE 21: USE OF CARS ON CERTAIN ROADS UNDER PAR CIRCULAR
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Lessee is
responsible for obtaining all consents or authority to use the cars
on any railroad. Upon the written request of Lessee (which request
shall name the railroads involved) Lessor shall use reasonable
efforts to obtain from each named railroad consents or authority to
place the cars in service under provisions issued by such railroad
or the AAR, including, without limitation, the provisions of AAR
Circular 0T-5 as promulgated by the Association of American
Railroads and all supplements thereto and reissues thereof. Lessee
shall furnish to Lessor such information as is necessary to apply
for and obtain such consents or authority. Lessor, however, shall
not be liable for failure to obtain such consents or authority for
any reason whatsoever and this Lease shall remain in full force and
effect notwithstanding any failure of Lessor or Lessee to obtain
such consents or authority.
ARTICLE 22: INDEMNIFICATIONS
Lessee shall
defend (if such defense is tendered to Lessee), indemnify and hold
Lessor harmless from and against and does hereby release Lessor
from all claims, suits, liabilities, losses, damages, costs and
expenses, including attorney’s fees, in any way arising out
of, or resulting from, the condition, storage, use, loss of use,
maintenance or operation of the cars, or any other cause whatsoever
except to the extent the same results from Lessor’s
negligence or except to the extent a railroad has assumed full
responsibility and satisfies such responsibility.
ARTICLE 23: TAXES AND LIENS
Lessor shall
be liable for and pay all Federal, State or other governmental
property taxes assessed
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