UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
 
 
FORM 8-K

 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

October 18, 2012
Date of Report (Date of earliest event reported)
 
 
CAI International, Inc.
( Exact name of registrant as specified in charter)
 
 
Delaware
001-33388
94-3109229
(State or other jurisdiction of incorporation)
(Commission File Number)
(I. R. S. Employer Identification No.)
 
Steuart Tower, 1 Market Plaza, Suite 900, San Francisco, CA 94105
(Address of principal executive offices, including ZIP Code)
 
Registrant’s telephone number, including area code: (415) 788-0100
 
N/A
(Former name or former address, if changed since last report)
 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 
 
 
 
Item 1.01.
Entry into a Material Definitive Agreement.

Note Offering

On October 18, 2012, CAL Funding II Limited (“CAL”), a wholly-owned indirect subsidiary of CAI International, Inc. (the “Company”), issued $171 million aggregate principal amount of 3.47% Series 2012-1 Fixed Rate Asset-Backed Notes (the “Notes”) pursuant to a Note Purchase Agreement among CAL, Container Applications Limited, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC.  The net proceeds of the Notes were used to repay part of the borrowings under the Company’s senior secured revolving credit facility.

The terms of the Notes are governed by an Indenture, dated October 18, 2012 (the “Indenture”), between CAL and Wells Fargo Bank, National Association, as trustee (the “Trustee”), as supplemented by the Series 2012-1 Supplement to the Indenture, dated October 18, 2012 (the “Supplement”).  Principal and interest on the Notes is payable monthly commencing on November 26, 2012, with the Notes maturing in October 2027, subject to mandatory prepayments and acceleration under certain circumstances.  The Notes are secured by a first priority security interest on all of the assets of CAL.

The transaction documents contain customary affirmative and negative covenants, representations and warranties, indemnification provisions and events of default, which are subject to certain conditions and exceptions.

The Notes were offered within the United States only to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), to persons outside of the United States in compliance with Regulation S under the Securities Act, and to other institutional accredited investors as defined in Rule 501 of Regulation D under the Securities Act.  The Notes have not been registered under the Securities Act or the securities laws of any other jurisdiction.

The foregoing description of the Notes, the Note Purchase Agreement, the Indenture, the Supplement and the other documents related to this transaction does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the full text of these documents which are attached hereto as exhibits to this Current Report on Form 8-K and are incorporated herein by reference.

Dritte Acquisition

On October 19, 2012, Container Applications Limited, a wholly-owned subsidiary of the Company, completed the previously announced acquisition of approximately 71,000 TEUs of container assets for approximately $87 million from Dritte Schroeder Container Beteiligungsgesellschaft mbH & CO. KG (“Dritte”) and its affiliate, Schroeder Leasing GMBH & Co. KG (“Schroeder”), pursuant to Container Purchase Agreements, dated October 19, 2012 (the “Container Purchase Agreements”), between Container Applications Limited and each of Dritte and Schroeder.  The Container Purchase Agreements contain customary representations and warranties, covenants and indemnifications provisions, which are subject to certain conditions and exceptions.

The foregoing description of the Container Purchase Agreements does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the full text of these documents which are attached hereto as exhibits to this Current Report on Form 8-K and are incorporated herein by reference.

Item 2.01. 
Completion of Acquisition or Disposition of Assets.

The information disclosed in Item 1.01 above is incorporated by reference into this Item 2.01.
 
 
 
 
 
Item 2.03. 
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information disclosed in Item 1.01 above is incorporated by reference into this Item 2.03.

Item 9.01. 
Financial Statements and Exhibits.

(d)   Exhibits.

Exhibit No.
 
Description
     
4.1
 
Indenture, dated October 18, 2012, between CAL Funding II Limited and Wells Fargo Bank, National Association.
     
4.2
 
Series 2012-1 Supplement, dated October 18, 2012, to Indenture dated October 18, 2012, between CAL Funding II Limited and Wells Fargo Bank, National Association.
     
99.1
 
Note Purchase Agreement, dated October 11, 2012, among CAL Funding II Limited, Container Applications Limited, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC.
     
99.2
 
Contribution and Sale Agreement, dated October 18, 2012, between Container Applications Limited and CAL Funding II Limited.
     
99.3
 
Performance Guaranty, dated October 18, 2012, made by CAI International, Inc. for the benefit of Wells Fargo Bank, National Association.
     
99.4
 
Container Purchase Agreement, dated October 19, 2012, between Container Applications Limited and Dritte Schroeder Container Beteiligungsgesellschaft mbH & CO. KG.
     
99.5
 
Container Purchase Agreement, dated October 19, 2012, between Container Applications Limited and Schroeder Leasing GMBH & Co. KG.

 
 
 
 
SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: October 22, 2012
CAI INTERNATIONAL, INC.
   
 
/s/ Timothy B. Page
 
Timothy B. Page
 
Chief Financial Officer

 
 
 

EXHIBIT INDEX

Exhibit No.
 
Description
     
 
Indenture, dated October 18, 2012, between CAL Funding II Limited and Wells Fargo Bank, National Association.
     
 
Series 2012-1 Supplement, dated October 18, 2012, to Indenture dated October 18, 2012, between CAL Funding II Limited and Wells Fargo Bank, National Association.
     
 
Note Purchase Agreement, dated October 11, 2012, among CAL Funding II Limited, Container Applications Limited, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC.
     
 
Contribution and Sale Agreement, dated October 18, 2012, between Container Applications Limited and CAL Funding II Limited.
     
 
Performance Guaranty, dated October 18, 2012, made by CAI International, Inc. for the benefit of Wells Fargo Bank, National Association.
     
 
Container Purchase Agreement, dated October 19, 2012, between Container Applications Limited and Dritte Schroeder Container Beteiligungsgesellschaft mbH & CO. KG.
     
 
Container Purchase Agreement, dated October 19, 2012, between Container Applications Limited and Schroeder Leasing GMBH & Co. KG.
 
 
EXHIBIT 4.1
 
 
CAL FUNDING II LIMITED
Issuer

and

WELLS FARGO BANK, NATIONAL ASSOCIATION
Indenture Trustee
_________________________

INDENTURE
Dated as of October 18, 2012
_________________________
 

 
 
 
 
TABLE OF CONTENTS
 
    Page
     
ARTICLE I DEFINITIONS
4
     
Section 101.
Defined Terms.
4
Section 102.
Other Definitional Provisions.
33
Section 103.
Computation of Time Periods.
34
Section 104.
Statutory References.
34
Section 105.
Duties of Administrative Agent and Manager Transfer Facilitator.
34
     
ARTICLE II THE NOTES
34
     
Section 201.
Authorization of Notes.
34
Section 202.
Form of Notes; Book-Entry Notes.
35
Section 203.
Execution, Recourse Obligation.
38
Section 204.
Certificate of Authentication.
39
Section 205.
Registration; Registration of Transfer and Exchange of Notes.
39
Section 206.
Mutilated, Destroyed, Lost and Stolen Notes.
41
Section 207.
Delivery, Retention and Cancellation of Notes.
42
Section 208.
ERISA Deemed Representations.
42
     
ARTICLE III PAYMENT OF NOTES; STATEMENTS TO NOTEHOLDERS
43
     
Section 301.
Principal and Interest.
43
Section 302.
Trust Account.
43
Section 303.
Investment of Monies Held in the Trust Account, the Restricted Cash Account and Series Accounts.
50
Section 304.
Reports to Noteholders.
52
Section 305.
Records.
53
Section 306.
Restricted Cash Account.
53
Section 307.
Pre-Funding Account.
54
Section 308.
CUSIP Numbers.
54
Section 309.
No Claim.
54
Section 310.
Compliance with Withholding Requirements.
54
Section 311.
Tax Treatment of Notes.
55
Section 312.
Subordination.
55
     
ARTICLE IV COLLATERAL
55
     
Section 401.
Collateral.
55
Section 402.
Pro Rata Interest.
56
Section 403.
Indenture Trustee’s Appointment as Attorney-in-Fact.
57
Section 404.
Release of Security Interest.
58
Section 405.
Administration of Collateral; Manager Transfer Facilitator Agreement and Intercreditor Collateral Agreement.
58
Section 406.
Quiet Enjoyment.
59
Section 407.
Intercreditor Collateral Agreement and Manager Transition Facilitator Agreement.
59
 
 
 
 
 
TABLE OF CONTENTS
(Continued)
 
    Page
     
ARTICLE V RIGHTS OF NOTEHOLDERS; ALLOCATION AND APPLICATION OF NET ISSUER PROCEEDS; REQUISITE GLOBAL MAJORITY
60
     
Section 501.
Rights of Noteholders.
60
Section 502.
Allocations Among Series.
60
Section 503.
Determination of Requisite Global Majority.
60
     
ARTICLE VI COVENANTS
60
     
Section 601.
Payment of Principal and Interest, Payment of Taxes.
61
Section 602.
Maintenance of Office.
61
Section 603.
Corporate Existence.
61
Section 604.
Protection of Collateral.
62
Section 605.
Performance of Obligations.
63
Section 606.
Negative Covenants
63
Section 607.
Non-Consolidation of Issuer.
65
Section 608.
No Bankruptcy Petition.
66
Section 609.
Liens.
66
Section 610.
Other Indebtedness.
66
Section 611.
Guarantees, Loans, Advances and Other Liabilities.
66
Section 612.
Consolidation, Amalgamation, Merger and Sale of Assets; Ownership of the Issuer.
66
Section 613.
Other Agreements.
67
Section 614.
Charter Documents.
67
Section 615.
Capital Expenditures.
67
Section 616.
Permitted Activities.
68
Section 617.
Investment Company.
68
Section 618.
Payments of Collateral.
68
Section 619.
Notices.
68
Section 620.
Books and Records
69
Section 621.
Taxes
69
Section 622.
Subsidiaries
69
Section 623.
Investments
69
Section 624.
Use of Proceeds
69
Section 625.
Purchase of Additional Containers.
69
Section 626.
Financial Statements.
69
Section 627.
OFAC.
70
Section 628.
UNIDROIT Convention.
70
Section 629.
Other Information.
70
Section 630.
Separate Identity.
70
Section 631.
Amendment of Intercreditor Collateral Agreement; Termination of Management Agreement.
70
     
ARTICLE VII DISCHARGE OF INDENTURE; PREPAYMENTS
71
     
Section 701.
Full Discharge.
71
 
 
-ii-
 
 
TABLE OF CONTENTS
(Continued)
 
    Page
     
Section 702.
Prepayment of Notes.
71
Section 703.
Unclaimed Funds.
73
     
ARTICLE VIII DEFAULT PROVISIONS AND REMEDIES
74
     
Section 801.
Event of Default.
74
Section 802.
Acceleration of Stated Maturity; Rescission and Annulment.
76
Section 803.
Collection of Indebtedness.
77
Section 804.
Remedies.
78
Section 805.
Indenture Trustee May Enforce Claims Without Possession of Notes.
79
Section 806.
Allocation of Money Collected
79
Section 807.
Limitation on Suits.
79
Section 808.
Unconditional Right of Holders to Receive Principal, Interest and Commitment Fees.
80
Section 809.
Restoration of Rights and Remedies.
80
Section 810.
Rights and Remedies Cumulative.
80
Section 811.
Delay or Omission Not Waiver.
81
Section 812.
Control by Requisite Global Majority.
81
Section 813.
Waiver of Past Defaults.
81
Section 814.
Undertaking for Costs.
82
Section 815.
Waiver of Stay or Extension Laws.
82
Section 816.
Sale of Collateral.
82
Section 817.
Action on Notes.
83
     
ARTICLE IX CONCERNING THE INDENTURE TRUSTEE
83
     
Section 901.
Duties of Indenture Trustee.
83
Section 902.
Certain Matters Affecting the Indenture Trustee.
85
Section 903.
Indenture Trustee Not Liable.
86
Section 904.
Indenture Trustee May Own Notes.
87
Section 905.
Indenture Trustee’s Fees, Expenses and Indemnities.
87
Section 906.
Eligibility Requirements for Indenture Trustee.
87
Section 907.
Resignation and Removal of Indenture Trustee.
88
Section 908.
Successor Indenture Trustee.
89
Section 909.
Merger or Consolidation of Indenture Trustee.
89
Section 910.
Separate Indenture Trustees, Co-Indenture Trustees and Custodians.
89
Section 911.
Representations and Warranties.
91
Section 912.
Indenture Trustee Offices.
92
Section 913.
Notice of Event of Default.
92
     
ARTICLE X SUPPLEMENTAL INDENTURES
93
     
Section 1001.
Supplemental Indentures Not Creating a New Series Without Consent of Holders.
93
Section 1002.
Supplemental Indentures Not Creating a New Series with Consent of Holders.
94
Section 1003.
Execution of Supplemental Indentures.
95
 
 
-iii-
 
 
TABLE OF CONTENTS
(Continued)
 
    Page
     
Section 1004.
Effect of Supplemental Indentures.
95
Section 1005.
Reference in Notes to Supplemental Indentures.
96
Section 1006.
Issuance of Series of Notes.
96
Section 1007.
Amendments to Intercreditor Collateral Agreement.
97
     
ARTICLE XI HOLDERS LISTS
98
     
Section 1101.
Indenture Trustee to Furnish Names and Addresses of Holders
98
Section 1102.
Preservation of Information; Communications to Holders
98
     
ARTICLE XII EARLY AMORTIZATION EVENT
98
     
Section 1201.
Early Amortization Event.
98
     
ARTICLE XIII MISCELLANEOUS PROVISIONS
99
     
Section 1301.
Compliance Certificates and Opinions.
99
Section 1302.
Form of Documents Delivered to Indenture Trustee.
100
Section 1303.
Acts of Holders.
100
Section 1304.
Limitation of Rights; Third Party Beneficiary.
101
Section 1305.
Severability.
101
Section 1306.
Notices.
101
Section 1307.
Consent to Jurisdiction.
102
Section 1308.
Captions.
102
Section 1309.
Governing Law.
102
Section 1310.
No Petition.
103
Section 1311.
General Interpretive Principles.
103
Section 1312.
WAIVER OF JURY TRIAL
103
Section 1313.
Waiver of Immunity
104
Section 1314.
Judgment Currency
104
Section 1315.
Statutory References
105
Section 1316.
Counterparts
105
 
EXHIBIT A
DEPRECIATION METHODS BY TYPE OF CONTAINER
 
     
EXHIBIT B
FORM OF PURCHASER LETTER
 
     
EXHIBIT C
FORM OF PURCHASER CERTIFICATION
 
     
EXHIBIT D
FORM OF NON-RECOURSE RELEASE
 
     
EXHIBIT E
FORM OF CONTROL AGREEMENT
 
     
EXHIBIT F
INTERCREDITOR COLLATERAL AGREEMENT
 
     
EXHIBIT G
TABLE OF COST-EQUIVALENT UNITS (CEU'S)
 
 
 
-iv-
 
 
This Indenture, dated as of October 18, 2012 (as amended or supplemented from time to time as permitted hereby, the “ Indenture ”), between CAL Funding II Limited, an exempted company with limited liability incorporated and existing under the laws of Bermuda (the “ Issuer ”), and Wells Fargo Bank, National Association, a national banking association, as Indenture Trustee (the “ Indenture Trustee ”).
 
W I T N E S S E T H :
 
WHEREAS, the Issuer desires to issue from time to time asset-backed warehouse revolving notes and term notes pursuant to this Indenture;
 
WHEREAS, such notes will be full recourse obligations of the Issuer and will be secured by the Collateral; and
 
WHEREAS, all acts and things have been done and performed which are necessary to make the Notes, when executed by the Issuer, authenticated by the Indenture Trustee and issued, the legal, valid and binding obligations of the Issuer, enforceable in accordance with their terms, and to make this Indenture a valid and binding agreement for the security of the Notes authenticated and delivered under this Indenture.
 
NOW THEREFORE, in consideration of the mutual agreements herein contained, each party agrees as follows for the benefit of the other party, the Noteholders and each Interest Rate Hedge Provider:
 
GRANTING CLAUSE
 
To secure the payment of the Aggregate Outstanding Obligations and the performance of all of the Issuer’s covenants and agreements in this Indenture and each other Related Document to which it is a party, the Issuer hereby grants, assigns, conveys, mortgages, pledges, charges, hypothecates and transfers to Indenture Trustee, for the benefit of the Noteholders and each Interest Rate Hedge Provider, a first priority perfected security interest in and to all assets and property of the Issuer, whether now existing or hereafter acquired, including, without limitation, all of the Issuer’s rights, title and interest in, to and under the following, whether now existing or hereafter created or acquired:
 
(i)            the Managed Containers and all other Transferred Assets;
 
(ii)           all Deposit Accounts and all Securities Accounts, including the Trust Account, the Restricted Cash Account, each Series Account, each Pre-Funding Account, and all cash and cash equivalents, Eligible Investments, Financial Assets, Investment Property, Securities Entitlements and other Instruments or amounts credited or deposited from time to time in any of the foregoing;
 
(iii)          the Contribution and Sale Agreement, the Management Agreement, the Interest Rate Hedge Agreements and each other Related Document to which the Issuer is a party;
 
 
 
 
 
(iv)          all Finance Lease Receivables and all other collections received by the Issuer from the operation of the Managed Containers, including any amount on deposit in the Manager Collection Account that, in accordance with the terms of the Intercreditor Collateral Agreement, is attributable to a Managed Container;
 
(v)           to the extent pertaining to the Managed Containers and other Transferred Assets, all Accounts;
 
(vi)          to the extent pertaining to the Managed Containers and other Transferred Assets, all Chattel Paper, all Leases and all schedules, supplements, amendments, modifications, renewals, extensions and all guaranties and other credit support with respect to the foregoing, all rentals, payments and monies due and to become due in respect of the foregoing, and all rights to terminate or compel performance thereof;
 
(vii)         all Contracts, provided that, if any such Contract relates to a Managed Container, such Lien will attach solely to the extent (but only to the extent that) such Contract pertains to the Managed Containers and the related Transferred Assets;
 
(viii)        all Documents, provided that, if any such Document relates to a Managed Container, such Lien will attach solely to the extent (but only to the extent that) such Document pertains to the Managed Containers and the related Transferred Assets;
 
(ix)           all General Intangibles, provided that, if such General Intangibles relate to a Managed Container, such Lien will attach solely to the extent (but only to the extent that) such General Intangible pertain to the Managed Containers and the related Transferred Assets;
 
(x)            all Instruments, provided that, if such Instrument relates to a Managed Container, such Lien will attach solely to the extent (but only to the extent that) such Instrument pertains to the Managed Containers and the related Transferred Assets;
 
(xi)           all Inventory;
 
(xii)          all Supporting Obligations, provided that, if such Supporting Obligation relates to a Managed Container, such Lien will attach solely to the extent (but only to the extent that) such Supporting Obligation pertains to the Managed Containers and the related Transferred Assets;
 
(xiii)         all Equipment;
 
(xiv)        all Letter of Credit Rights, provided that, if such Letter of Credit Rights relate to a Managed Container, such Lien will attach solely to the extent (but only to the extent that) such Letter of Credit Rights pertain to the Managed Containers and the related Transferred Assets;
 
(xv)         all Commercial Tort Claims, provided that, if such Commercial Tort Claim relates to a Managed Container, such Lien will attach solely to the extent (but only to the extent that) such Commercial Tort Claim pertains to the Managed Containers and the related Transferred Assets;
 
 
2
 
 
(xvi)        all property of the Issuer including, without limitation, all property of every description now or hereafter in the possession or custody of or in transit to the Indenture Trustee for any purpose, including, without limitation, safekeeping, collection or pledge, for the account of the Issuer, or as to which the Issuer may have any right or power;
 
(xvii)       the right of the Issuer to terminate, perform under, or compel performance of the terms of the Container Related Agreements and all claims for damages arising out of the breach of any Container Related Agreement;
 
(xviii)      any guarantee of the Container Related Agreements and any rights of the Issuer in respect of any subleases or assignments permitted under the Container Related Agreements;
 
(xix)         all or any part of insurance proceeds of all or any part of the Collateral and all proceeds of the voluntary or involuntary disposition of all or any part of the Collateral or such proceeds;
 
(xx)          any and all payments made or due to the Issuer in connection with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral by any Governmental Authority and any other cash or non-cash receipts from the sale, exchange, collection or other disposition of all or any part of the Collateral;
 
(xxi)         to the extent not otherwise included, all income, payments and Proceeds of each of the foregoing and all accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing.
 
All of the property described in this Granting Clause is herein collectively called the “ Collateral ” and as such is security for the payment of the Aggregate Outstanding Obligations and the performance of all of the Issuer’s covenants and agreements in this Indenture and each other Related Document to which it is a party.  Notwithstanding the foregoing Grant, however, (i) no account, instrument, chattel paper or other obligation or property of any kind due from, owed by, or belonging to, a Prohibited Person and (ii) no Lease in which the Lessee is a Prohibited Person, shall, in either instance, constitute Collateral.
 
The Trustee's security interest in the foregoing Collateral shall be subject at all times to the provisions of the Intercreditor Collateral Agreement (to the extent that the Intercreditor Collateral Agreement is applicable thereto).
 
The Issuer hereby grants to the Indenture Trustee, for the benefit of the Noteholders and each Interest Rate Hedge Provider, each of (i) a fixed charge over the Issuer’s rights (but not its obligations) under the Contribution and Sale Agreement, each Interest Rate Hedge Agreement, and the Management Agreement, and (ii) a floating charge over all other assets of the Issuer.
 
 
3
 
 
In furtherance of the foregoing, the Issuer hereby appoints the Indenture Trustee as its designee for purposes of exercising the power of attorney granted pursuant to Section 10.3 of the Management Agreement.
 
The Indenture Trustee acknowledges such Grant, accepts the trusts hereunder in accordance with the provisions hereof, and agrees to perform the duties herein required as hereinafter provided.  Notwithstanding the foregoing, the Indenture Trustee does not assume, and shall have no liability to perform, any of the Issuer’s obligations under any agreement included in the Collateral and shall have no liability arising from the failure of the Issuer or any other Person to duly perform any such obligations.
 
The Issuer hereby irrevocably authorizes the Indenture Trustee at any time, and from time to time, to file in any filing office in any UCC jurisdiction any financing statements (including any such financing statements claiming a security interest in all assets of the Issuer) and amendments thereto that (i) indicate the Collateral, regardless of whether any particular asset comprised in the Collateral falls within the scope of Article 9 of the UCC, and (ii) provide any other information required by Article 9 of the UCC for the sufficiency or filing office acceptance of any financing statement or amendment, including whether the Issuer is an organization, the type of organization and any organizational identification number issued to the Issuer; provided , however , that the Indenture Trustee shall not be obligated to file, or authorize the filing of, any financing statements or amendments thereto except upon the written instruction from the Issuer or the Manager.  The Issuer agrees to furnish any such information to the Indenture Trustee promptly upon the Indenture Trustee’s request.  The Issuer also ratifies its authorization for the Indenture Trustee to have filed in any jurisdiction any similar initial financing statements or amendments thereto if filed prior to the date hereof.
 
ARTICLE I
 
DEFINITIONS
 
Section 101.                 Defined Terms .
 
Capitalized terms used in this Indenture shall have the following meanings and the definitions of such terms shall be equally applicable to both the singular and plural forms of such terms:
 
Account:   Any “account”, as such term is defined in Section 9-102(a)(2) of the UCC.
 
Administrative Agent :  The Person performing the duties of the Administrative Agent under any applicable Note Purchase Agreement for any Series of Warehouse Notes.
 
Administrative Agent Fee :  This term shall have the meaning set forth in any applicable Note Purchase Agreement for any Series of Warehouse Notes, as such agreement may be amended, modified and restated from time to time in accordance with its terms.
 
 
4
 
 
Advance Rate :  For any Series, this term shall have the meaning set forth in the related Supplement.
 
Affiliate:   With respect to a specified Person, any other Person that directly or indirectly through one or more intermediaries controls or is controlled by or is under common control with the specified Person.  For the purposes of this definition, “control”, when used with respect to any specified Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
 
Aggregate Asset Value :  As of any date of determination, an amount equal to the sum of (i) the Aggregate Net Book Value and (ii) the Aggregate Finance Lease Balance.
 
Aggregate Finance Lease Balance :  As of any date of determination, the sum of the then Finance Lease Balance of all Eligible Finance Leases.
 
Aggregate Net Book Value:   As of any date of determination, an amount equal to the sum of the Net Book Values of all Eligible Containers then not subject to a Finance Lease.
 
Aggregate Outstanding Obligations:   As of any date of determination, an amount equal to the sum of (i) the Outstanding Obligations for all Series of Notes then Outstanding, and (ii) all other amounts owing by the Issuer to the Indenture Trustee, any Noteholder, or any Interest Rate Hedge Provider pursuant to the terms of any Related Document.
 
Aggregate Principal Balance:   As of any date of determination, an amount equal to the sum of the then unpaid principal balance of all Series of Notes then Outstanding.
 
Applicable Law:   With respect to any Person or Managed Container, all law, treaties, judgment, decrees, injunctions, waits, rules, regulations, orders, directives, concessions, licenses and permits of any Governmental Authority applicable to such Person or its Property or in respect of its operations.
 
Asset Base:   As of any date of determination, an amount equal to the sum of (a) the product of (x) the Advance Rate and (y) an amount equal to the sum (without duplication) of (i) the Aggregate Asset Value, determined as of such date of determination, (ii) the aggregate outstanding balance of receivables resulting from the sale or other disposition of one or more Eligible Containers which have not been outstanding for more than sixty (60) days from the issue date of such receivables, plus (iii) the aggregate outstanding balance of receivables owing from insurers on account of a Casualty Loss with respect to an Eligible Container which have not been outstanding for more than sixty (60) days; provided, however, that the sum of the amounts described in clauses (ii) and (iii) shall not in aggregate exceed an amount equal to two percent (2%) of the Asset Base, (b) the amount on deposit in the Restricted Cash Account on such date of determination, after giving effect to all deposits to and withdrawals from the Restricted Cash Account on such date and (c) any amount on deposit in any Pre-Funding Account as of such date (and in the case of clause (c), solely as funded from an issuance of a Series of Notes).
 
 
5
 
 
Asset Base Deficiency: The condition that exists on any Payment Date if the then Aggregate Principal Balance (calculated to include all principal payments actually paid on such date) exceeds the Asset Base.
 
Asset Base Report:   This term shall have the meaning set forth in the Management Agreement.
 
Asset Value :  The Net Book Value or Finance Lease Balance of an Eligible Container, whichever applies to the specific Eligible Container.
 
Authorized Signatory:   Any Person designated by written notice delivered to the Indenture Trustee as authorized to execute documents and instruments on behalf of a Person.
 
Available Distribution Amount:   For any Payment Date, an amount equal to the sum (without duplication) of (i) ONOI (as defined in the Management Agreement) plus the Miscellaneous Owner Proceeds (as defined in the Management Agreement), Sales Proceeds, Issuer’s share of Casualty Proceeds and Indemnification Proceeds (as defined in the Management Agreement) for all Managed Containers received from the Manager pursuant to the terms of the Management Agreement during the immediately preceding Collection Period, less certain sums deducted in accordance with the terms of the Management Agreement, (ii) all amounts received by the Issuer on the related Determination Date pursuant to any Interest Rate Hedge Agreement, (iii) all Warranty Purchase Amounts and Manager Advances received by the Issuer since the immediately preceding Determination Date, (iv) all other amounts deposited into the Trust Account during the immediately preceding Collection Period pursuant to the terms of the Management Agreement and (v) any earnings on Eligible Investments in the Trust Account to the extent that such earnings were credited to such account during the related Collection Period.
 
Back-up Manager Event:   The occurrence of either of the following events:
 
(a)           the date on which the Consolidated Leverage Ratio (as defined in the Management Agreement) of CAI and its Subsidiaries as of the last day of any fiscal quarter exceeds 4.25 to 1.00; or
 
(b)           the date on which the ratio of EBIT Ratio of CAI and its Subsidiaries as of the last day of any fiscal quarter is less than 1.20 to 1.00.
 
If either of the events set forth in clause (a) or clause (b) above shall occur, a Back-up Manager Event shall occur on the date on which the Requisite Global Majority shall declare in a written notice delivered to the Indenture Trustee and the Administrative Agent that a Back-up Manager Event has occurred.  Upon any such declaration, the Requisite Global Majority may waive in writing such Back-up Manager Event.  Upon receipt of written notice of such declaration of a Back-up Manager Event, the Indenture Trustee shall promptly notify the Noteholders and the Manager Transfer Facilitator.
 
Bankruptcy Code:   The United States Bankruptcy Reform Act of 1978, as amended.
 
 
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Book-Entry Custodian:   The Person appointed pursuant to the terms of this Indenture to act in accordance with a certain letter of representations agreement such Person has with the Depositary, in which the Depositary delegates its duties to maintain the Book-Entry Notes to such Person and authorizes such Person to perform such duties.
 
Book-Entry Notes:   Collectively, the Rule 144A Book-Entry Notes, the Regulation S Temporary Book-Entry Notes and the Unrestricted Book-Entry Notes.
 
Business Day:   Any day other than a Saturday, a Sunday or a day on which the New York Stock Exchange, the Federal Reserve Bank or banking institutions in San Francisco, California, New York, New York or the city in which the Corporate Trust Office is located, are authorized or are obligated by law, executive order or governmental decree to be closed.
 
CAI:   CAI International Inc., a corporation organized under the laws of the State of Delaware, and its successors and permitted assigns.
 
CAL:   Container Applications Limited, a company organized under the laws of Barbados and a wholly-owned subsidiary of CAI, and its successors and permitted assigns.
 
CAL Funding I:   CAL Funding I Limited, an exempted company with limited liability incorporated and existing under the laws of Bermuda.
 
Capital Stock :  Any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation) and any and all warrants, rights or options to purchase any foregoing.
 
Capitalized Leases :  Leases under which CAI or any of its Subsidiaries is the lessee or obligor, the discounted future rental payment obligations under which are required to be capitalized on the balance sheet of the lessee or obligor in accordance with GAAP.
 
Casualty Loss:   Any of the following events with respect to any Managed Container:  (a) the actual total loss or constructive total loss of such Managed Container, (b) the loss, theft or destruction of such Managed Container (including any failure to recover a  Managed Container that is or was subject to a Defaulted Lease or a defaulted Finance Lease that continues after the Manager has exhausted available legal process), (c) such Managed Container is damaged beyond repair or permanently rendered unfit for normal use for any reason whatsoever, (d) the seizure, condemnation, confiscation, forced sale or other taking of title to or use of such Managed Container, (e) if such Managed Container is subject to a Lease, such Managed Container shall have been deemed under its Lease to have suffered a casualty loss as to the entire Managed Container or (f) the value of such Managed Container in the accounting records of the Issuer has been written off by the Issuer (or the Manager, on behalf of the Issuer) as required by GAAP. In determining the date on which a Casualty Loss occurred, the application of the time frames set forth in clauses (a) through (f) above shall in no event result in the deemed occurrence of a Casualty Loss prior to the date on which an officer of the Issuer or the Manager obtains actual knowledge of such Casualty Loss.
 
 
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Casualty Proceeds:   This term shall have the meaning set forth in the Management Agreement.
 
CEU :   A cost-equivalent unit which is a fixed unit of measurement based on the cost of a Container relative to the cost of each respective type of Container as listed on Exhibit G hereto.
 
Chattel Paper: Any lease (including any Finance Lease) or other “chattel paper”, as such term is defined in Section 9-102(a)(11) of the UCC.
 
Class:   With respect to any Series, all Notes within such Series having the same rights to payment under the related   Supplement.
 
Closing Date:   This term shall have the meaning set forth in the related Supplement.
 
Code :  The Internal Revenue Code of 1986, as amended, or any successor statute thereto.
 
Collateral:   This term shall have the meaning set forth in the Granting Clause of this Indenture.
 
Collection Period.   For any Payment Date, the period from the first day of the calendar month immediately preceding the month in which such Payment Date occurs through and including the last day of such calendar month;   provided, however , that the initial Collection Period shall commence on the Closing Date and end on October 31, 2012.
 
Collections:   With respect to any Collection Period, all payments (including any cash proceeds) actually received by the Issuer with respect to the Managed Containers and the other items of Collateral, including amounts distributed by the Manager to the Issuer pursuant to Section 7.2 of the Management Agreement or otherwise.
 
Commercial Tort Claims :  Any “commercial tort claim”, as such term is defined in 9-102(a)(13) of the UCC.
 
Competitor:   Any Person engaged and competing with any of the Issuer, CAL or CAI in the Container leasing business and any Affiliate of any such Person; provided, however, that in no event shall any insurance company, bank, bank holding company, savings institution or trust company, fraternal benefit society, pension, retirement or profit sharing trust or fund, or any collateralized bond obligation fund or similar fund (or any trustee of any such fund) or any holder of any obligations of any such fund (solely as a result of being such a holder) be deemed to be a Competitor solely as a result of being an Affiliate of a Competitor, provided that firewalls are put in place to prevent confidential information of the Issuer or Manager from being distributed to the Competitor.
 
Consolidated EBIT:   With respect to any fiscal period, an amount equal to the sum of (a) Consolidated Net Income (or Deficit) of CAI and its Subsidiaries for such fiscal period, plus (b) in each case to the extent deducted in the calculation of such Person's Consolidated Net Income and without duplication, (i) income tax expense for such period, plus (ii) Consolidated Total Interest Expense paid or accrued during such period, plus (iii) other noncash charges for such period, all as determined in accordance with GAAP.
 
 
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Consolidated Funded Debt:   At any time of determination, with respect to CAI and its Subsidiaries, the sum, without duplication, of (a) the aggregate amount of Indebtedness of CAI and its Subsidiaries, on a consolidated basis, relating to (i) the borrowing of money or the obtaining of credit, including the issuance of notes or bonds, (ii) the deferred purchase price of assets (other than trade payables (including trade payables to manufacturers) incurred in the ordinary course of business), (iii) Capitalized Leases, (iv) Rental Obligations, and (v) the maximum drawing amount of all letters of credit outstanding plus (b) Indebtedness of the type referred to in clause (a) of another Person guaranteed by CAI or any of its Subsidiaries .
 
Consolidated Net Income (or Deficit):   The consolidated net income (or deficit) of CAI and its Subsidiaries, after deduction of all expenses, taxes, and other proper charges, determined in accordance with GAAP, after eliminating therefrom all non-recurring non-cash gains or losses and any unrealized adjustments, whether positive or negative, resulting from interest rate protection agreements or swap contracts in respect of currency hedging entered into in the ordinary course of business.
 
Consolidated Tangible Net Worth :  As of any date of determination, for CAI and its Subsidiaries on a consolidated basis, Shareholders’ Equity of CAI and its Subsidiaries on such date minus the Intangible Assets of CAI and its Subsidiaries on such date; provided that the calculation of Consolidated Tangible Net Worth shall exclude any unrealized adjustments, whether positive or negative, resulting from interest rate protection agreements or swap contracts in respect of currency hedging entered into in the ordinary course of business.
 
Consolidated Total Interest Expense:   For any period, the aggregate amount of interest required to be paid or accrued by CAI or any of its Subsidiaries during such period on all Indebtedness of CAI or such Subsidiary outstanding during all or any part of such period, whether such interest was or is required to be reflected as an item of expense or capitalized, including payments consisting of interest in respect of any Capitalized Lease or any Synthetic Lease, and including commitment fees, agency fees, facility fees, balance deficiency fees and similar fees or expenses in connection with the borrowing of money.
 
Container:   Any dry freight cargo, high cube, flat rack, refrigerated (including associated generator sets), rolltrailer or other type of marine or intermodal container.
 
Container Related Agreement:   Any agreement relating to the Managed Containers or agreements relating to the use or management of such Managed Containers whether in existence on any Series Issuance Date or thereafter acquired, including, but not limited to, all Leases, the Management Agreement, the Contribution and Sale Agreement and the Chattel Paper; provided , that any such agreement shall be deemed a “Container Related Agreement” only to the extent that they pertain to the Managed Containers.
 
Container Representations and Warranties:   This term shall have the meaning set forth in the Contribution and Sale Agreement.
 
 
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Contracts:   All contracts, undertakings, franchise agreements or other agreements (other than rights evidenced by Chattel Paper, Documents or Instruments), arising out of or in any way related to the Managed Containers or to the Notes, in or under which Issuer may now or hereafter have any right, title or interest, including, without limitation, the Management Agreement, the Contribution and Sale Agreement, any Interest Rate Hedge Agreements and any related agreements, security interests or UCC or other financing statements and, with respect to an Account, any agreement relating to the terms of payment or the terms of performance thereof.
 
Contribution and Sale Agreement:   The Contribution and Sale Agreement, dated as of October 18, 2012, between the Issuer, CAL and CAL Funding I, as such agreement may be amended, modified or supplemented from time to time in accordance with its terms.
 
Control Agreement:   A control agreement, among the Issuer, the Indenture Trustee and the Securities Intermediary, which shall be substantially in the form of Exhibit E to this Indenture, for each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account and each Series Account.
 
Control Party:   With respect to a Series, this term shall have the meaning set forth in the Supplement for the related Series.
 
Conversion Date:   With respect to any Series of Warehouse Notes, the date on which a Conversion Event occurs with respect to such Series of Warehouse Notes.
 
Conversion Event:   With respect to any Series of Warehouse Notes, any event that will result in the termination of the revolving period for such Series and the commencement of principal amortization of such Series as set forth in the related Supplement.
 
Corporate Trust Office:   The principal office of the Indenture Trustee at which at any particular time its corporate trust business shall be administered.  As of the Closing Date, such office is located at MAC N9311-161, Sixth Street and Marquette Avenue, Minneapolis, MN 55479; Attention:  Corporate Trust Services - Asset-Backed Administration, Telephone: (612) 667-8058, Facsimile: (612) 667-3464.
 
Corporate Trust Officer:   Any Treasurer, Assistant Treasurer, Assistant Trust Officer, Trust Officer, Assistant Vice President, Vice President or Senior Vice President of the Indenture Trustee or any other officer who customarily performs functions similar to those performed by the Persons who at the time shall be such officers to whom any corporate trust matter is referred because of their knowledge of and familiarity with the particular subject.
 
Default Interest:   The incremental interest specified in the related Supplement payable by the Issuer resulting from (i) the failure of the Issuer to pay when due any principal of or interest on the Notes of the related Series or (ii) the occurrence of an Event of Default with respect to such Series.
 
Defaulted Lease:   Any Lease as to which any of the following events or conditions apply:
 
 
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(i)             the Manager has or should have determined in accordance with the terms of the Management Agreement that all or any material portion of any regularly scheduled rental payments or end of term payments owing pursuant to the terms of such Lease are wholly or partially uncollectible;
 
(ii)            both of the following shall have occurred:  (a) the Lessee under such Lease is the subject of an Insolvency Proceeding and (b) the Lessee shall not be current in its obligations 90 days after the commencement of such Insolvency Proceeding; or
 
(iii)           the Manager has repossessed the equipment or is otherwise exercising remedies with respect to such Lease.
 
Definitive Note :  A Note issued in physical form pursuant to the terms and conditions of Section 202 hereof.
 
Deposit Account:   Any “deposit account,” as such term is defined in Section 9-102(a)(29) of the UCC.
 
Depositary :  The Depository Trust Company until a successor depositary shall have become such pursuant to the applicable provisions of this Indenture and thereafter “Depositary” shall mean or include each Person who is then a Depositary hereunder.  For purposes of this Indenture, unless otherwise specified pursuant to Section 202, any successor Depositary shall, at the time of its designation and at all times while it serves as Depositary, be a clearing agency registered under the Exchange Act, and any other applicable statute or regulation.
 
Depositary Participants :  A broker, dealer, bank, other financial institution or other Person for whom from time to time the Depositary effects book-entry transfers and pledges of securities deposited with the Depositary.
 
Depreciation Expense:   With respect to any calculation of the Asset Base, means either (i) the Depreciation Policy or (ii) such other depreciation policy as may be utilized by the Manager from time to time, with the prior written consent of the Control Party for each Series.
 
Depreciation Policy:   The depreciation policy set forth as Exhibit A hereto, as it may be amended from time to time in accordance with this Indenture and the Related Documents.
 
Determination Date:   The fourth (4 th ) Business Day prior to the related Payment Date.
 
Direct Finance Leases :  A lease that satisfies the criteria for classification as a capital lease pursuant to GAAP, including under Financial Accounting Standards Board Statement No. 13, as amended.
 
Discount Rate :  For purposes of determining the Aggregate Finance Lease Balance as of any date of determination, an interest rate per annum equal to the Effective Annual Yield of such Finance Lease.
 
 
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Documents:   Any “documents,” as such term is defined in Section 9-102(a)(30) of the UCC.
 
Dollars:   Dollars and the sign “$” means lawful money of the United States of America.
 
Early Amortization Event:   The occurrence of any of the events or conditions set forth in Section 1201 hereof.
 
EBIT:   For any fiscal quarter for the Issuer, Net Income (deficit) before Interest Expense and taxes, determined in accordance with GAAP, including   gains and losses from the sale of assets and foreign exchange transactions, but excluding gains or losses resulting from changes in the Depreciation Policy and excluding unrealized gains or losses arising from implementation of Statement of Financial Accounting Standards No. 133 relating to “marking to market” of interest and foreign exchange hedges issued by the Financial Accounting Standards Board.
 
EBIT Ratio:   For the Issuer or CAI and its Subsidiaries (as the case may be) as of any date of determination, the ratio of (a) either (x) in the case of the Issuer, aggregate EBIT or (y) in the case of CAI, Consolidated EBIT to (b) either (x) in the case of the Issuer, aggregate Interest Expense or (y) in the case of CAI, Consolidated Total Interest Expense, in each case for the most recently concluded six (6) fiscal quarters, commencing with the fiscal quarter ending December 31, 2012.  With respect to the calculation of the EBIT Ratio for the Issuer, the following rules shall apply: (1) If less than six (6) fiscal quarters have elapsed since October 1, 2012, the EBIT Ratio shall be calculated for the actual number of fiscal quarters that have elapsed since October 1, 2012; and (2) the partial fiscal quarter commencing the Closing Date and ending December 31, 2012 shall be considered a full fiscal quarter for purposes of determining EBIT Ratio. For purposes of calculating the EBIT Ratio for the Issuer for such partial fiscal quarter, aggregate EBIT and aggregate Interest Expense shall each be expanded to reflect earnings and interest expense as if for a full fiscal quarter by: (i) dividing (y) aggregate EBIT and aggregate Interest Expense (as the case may be) for such period for the Issuer, by (z) the number of days in such period; and (ii) multiplying the resulting quotient by the number of days in the fiscal quarter ending December 31, 2012.
 
Effective Annual Yield :  The annualized interest rate on a Lease computed using compound interest techniques, determined as of the date of lease commencement.
 
Eligible Account:   Either (a) a segregated account with an Eligible Institution (in its capacity as Securities Intermediary of the Indenture Trustee), or (b) a segregated trust account with the corporate trust department of the Indenture Trustee (in its capacity as Securities Intermediary of the Indenture Trustee) or any other depository institution organized under the laws of the United States or any of the states thereof (in its capacity as Securities Intermediary of the Indenture Trustee), including the District of Columbia (or any United States branch of a non-United States bank), and acting as a trustee for funds deposited in such account, so long as the senior securities of such depository institution shall have a credit rating from each applicable Rating Agency in one of its generic credit rating categories no lower than “A2” and “A”, as the case may be, and the short-term unsecured senior debt obligations of such depository institution or trust company are rated at least “P-1” by Moody’s and “A-1” by S&P, as the case may be, or (c) any account held with the Indenture Trustee (in its capacity as Securities Intermediary of the Indenture Trustee) provided that the institution then acting as Indenture Trustee is an Eligible Institution.
 
 
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Eligible Container:   As of any date of determination, any Managed Container which, when considered with all other Managed Containers, shall comply with each of the following requirements:
 
(i)             Specifications .  The Managed Container conforms to (i) the standard specifications used by the Manager for that category of container and to any applicable industry standards, or (ii) if such Managed Container is subject to a Finance Lease, to the standard specification of either the Manager or the Lessee;
 
(ii)            Casualty Losses .  Such Managed Container shall not have suffered a Casualty Loss;
 
(iii)            Title .  The  related Seller shall have had good and marketable title to such Managed Container at the time of sale to the Issuer;
 
(iv)            Purchase Price .  The purchase price paid by the related Seller for such Managed Container was not greater than the Fair Market Value of such container at the time of acquisition by such Seller;
 
(v)            General Trading Terms .  The Leases for such Managed Containers shall be entered into or acquired in the ordinary course of business and contain commercially reasonable terms, consistent with the general trading terms the Manager uses in its normal course of business;
 
(vi)            No Prohibited Person or Prohibited Jurisdiction .  Such Managed Container is then not on lease to a Prohibited Person, and to the actual knowledge of the Issuer or the Manager, is not subleased to a Prohibited Person or located, operated or used in a Prohibited Jurisdiction unless it is used by the government of the United States or one of its allies or pursuant to a license granted by the Office of Foreign Assets Control of the United States Treasury Department;
 
(vii)           Good Title; No Liens .  The Issuer has good and marketable title to such Managed Container, free and clear of all Liens other than (i) Permitted Encumbrances, and (ii) if Managed Container is subject to a Lease, those Liens that the Lessee is required to remove pursuant to the terms of such Lease;
 
(viii)          Container Representations and Warranties .  Each Managed Container complies with the Container Representations and Warranties applicable to such Managed Container;
 
(ix)            Bankrupt Lessee under Finance Leases .  If such Managed Container is then subject to a Finance Lease, such Finance Lease is not a Defaulted Finance Lease;
 
 
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(x)             Maximum Concentration of Specialized Containers .  The sum of the Asset Values of all specialized Containers (other than twenty foot (20’) dry freight, forty foot (40’) dry freight or forty foot (40’) high cube dry freight cargo Containers) and twenty foot (20’) and forty foot (40’) refrigerated containers and associated generator sets then owned by the Issuer shall not exceed an amount equal to thirty percent (30%) of the Aggregate Asset Value;
 
(xi)            Finance Leases .  The sum of the Finance Lease Balances of all Containers then owned by the Issuer then subject to a Finance Lease shall not exceed an amount equal to thirty-five percent (35%) of the Aggregate Asset Value, and the UCC filing specified in Section 2.03(a)(iv) of the Contribution and Sale Agreement shall have been made with respect to such Finance Leases;
 
(xii)           Non-Monthly Leases .  The percentage of CEUs of all Eligible Containers that are subject to Leases specifying that rental payments are payable less frequently than monthly shall not exceed five percent (5%) of the aggregate number of CEUs of all Eligible Containers on such date (with the CEU's pertaining to Containers on Non-Monthly Leases in excess of five percent (5%) disregarded for purposes of determining Eligible Containers);
 
(xiii)          Non-United States Dollar Leases .  The percentage of CEUs of all Eligible Containers that are subject to Leases specifying payment in a currency other than United States Dollars and that are not sufficiently hedged in accordance with the currency hedging policy approved by the Requisite Global Majority shall not exceed two percent (2%) of the aggregate number of CEUs of all Eligible Containers on such date (with the CEU's pertaining to Containers on Non-United States Dollar Leases in excess of two percent (2%) disregarded for purposes of determining Eligible Containers);
 
(xiv)          Maximum Concentration for Single Lessee .   The Asset Values of  Eligible Containers that are subject to Leases to any single lessee (or sublessee) shall not exceed twenty percent (20%) of the Aggregate Asset Value (with the Asset Value of Containers in excess of twenty percent (20%) of Aggregate Asset Value disregarded for purposes of determining Eligible Containers);
 
(xv)           Maximum Concentration of Top Three Lessees .  The sum of the Asset Values of Eligible Containers that are on Lease to any three (3) lessees (or sublessees) shall not exceed sixty percent (60%) of the Aggregate Asset Value (with the Asset Values of Containers in excess of sixty percent (60%) of the Aggregate Asset Value disregarded for purposes of determining Eligible Containers);
 
(xvi)          Maximum Concentration of Finance Leases by Lessee .  The sum of the Finance Lease Balances of all Eligible Containers that are subject to Finance Leases with a single Lessee shall not exceed fifteen percent (15%) of the Aggregate Asset Value (with the Finance Lease Balances pertaining to a single Lessee in excess of fifteen percent (15%) disregarded for purposes of determining the Aggregate Asset Value);
 
 
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(xvii)         No Violation .  The contribution and conveyance of such Managed Container to the Issuer does not violate any agreement to which the related Seller is a party or by which it or its properties are bound;
 
(xviii)        Assignability .  The Lease rights with respect to such Container are freely assignable without the consent of any Person other than consents which have been obtained;
 
(xix)          All Necessary Actions Taken .  The related Seller and the Issuer shall have taken all necessary actions set forth in the Contribution and Sale Agreement to transfer from such Seller to the Issuer title to such Container and all related Leases; and
 
(xx)            Restrictions on Leases to Affiliates .  No Lessee of a Managed Container is the Manager, the Issuer or any of their respective Affiliates, as lessee.
 
The foregoing requirements are subject to modification at the request of Issuer upon satisfaction of the Rating Agency Condition (if any Series of Notes then Outstanding has been rated by at least one of the Rating Agencies) and receipt of the prior written consent of the Requisite Global Majority.
 
Eligible Finance Lease :  A Finance Lease that complies with all of the following:  (i) the related Managed Container is not on lease to a Prohibited Person unless it is used pursuant to a license granted by OFAC; (ii) the Finance Lease is not a Defaulted Lease; and (iii) such Finance Lease and the related receivables are subject to no Liens other than Permitted Encumbrances.
 
Eligible Institution:   Any one or more of the following institutions:  (i) the corporate trust department of the Indenture Trustee (in its capacity as Securities Intermediary) of the Indenture Trustee so long as the Indenture Trustee maintains a long-term unsecured senior debt rating of at least “A” or better from Standard & Poor’s or “A2” or better from Moody’s (so long as Notes deemed Outstanding hereunder are rated by Moody’s), or (ii) a depository institution organized under the laws of the United States of America or any one of the states thereof or the District of Columbia (or any United States branch of a non-United States bank), (a) which, if applicable, has both (x) a long-term unsecured senior debt rating of not less than “A” by Standard & Poor’s and “A2” by Moody’s, and (y) a short-term unsecured senior debt rating of at least “P-1” by Moody’s and “A-1” by Standard & Poor’s and (b) whose deposits are insured by the Federal Deposit Insurance Corporation.
 
Eligible Interest Rate Hedge Counterparty :  Any of the following:
 
(1)            any bank or other financial institution that satisfies the criteria established by each applicable Rating Agency; or
 
(2)           any bank or other financial institution (i) which is otherwise acceptable to the Requisite Global Majority and (ii) for which the Rating Agency Condition (if applicable) has been satisfied.
 
Eligible Investments:   One or more of the following:
 
 
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(i)             direct obligations of, and obligations fully guaranteed as to the timely payment of principal and interest by, the United States of America or obligations of any agency or instrumentality thereof when such obligations are backed by the full faith and credit of the United States of America, so long as such obligations shall have been rated at least “Aa3” by Moody’s and “AA-“ by S&P or such lower rating as will not result in the downgrading or withdrawal of the ratings of the Notes;
 
(ii)            demand deposits, time deposits, money market deposit accounts, certificates of deposit and bankers' acceptances (that shall each have an original maturity of not more than 365 days) of any depository institution or trust company (including the Indenture Trustee, acting in its commercial capacity), provided that the long-term unsecured senior debt obligations of such depository institution or trust company at the date of acquisition thereof have been rated at least "Aa3" from Moody's and "AA-" from Standard & Poor’s, or the short-term unsecured senior debt obligations of such depository institution or trust company are rated “P-1” by Moody’s and “A-1” by Standard & Poor’s, or such lower rating as will not result in the downgrading or withdrawal of the ratings of the Notes;
 
(iii)           commercial paper (having original maturities of not more than 270 days) of any corporation (other than the Issuer, but including the Indenture Trustee, acting in its commercial capacity), incorporated under the laws of the United States of America or any state thereof which on the date of acquisition has been rated “P-1” by Moody’s and “A-1” by Standard & Poor’s, or such lower rating as will not result in the downgrading or withdrawal of the ratings of the Notes;
 
(iv)           any money market fund that has been rated “Aaa – mf” by Moody’s and AAAm” by Standard & Poor’s, or such lower rating as will not result in the downgrading or withdrawal of the ratings of the Notes, or that invests solely in Eligible Investments;
 
(v)            Eurodollar deposits (that shall each have an original maturity of not more than 365 days) of any depository institution or trust company, provided that the long-term unsecured senior debt obligations of such depository institution or trust company at the date of acquisition thereof have been rated at least "Aa3" from Moody's and "AA-" from Standard & Poor’s, or the short-term unsecured senior debt obligations of such depository institution or trust company are rated “P-1” by Moody’s and “A-1” by Standard & Poor’s, or such lower rating as will not result in the downgrading or withdrawal of the ratings of the Notes; and
 
(vi)           other obligations or securities that satisfy the Rating Agency Condition.
 
Nothing in the definition of “Eligible Investments” is intended to prohibit the Issuer from acquiring an Eligible Investment issued by the Indenture Trustee or an Affiliate of the Indenture Trustee, so long as such Eligible Investment meets one or more of the criteria above.
 
Entitlement Order:   Any “entitlement order” as defined in Section 8-102(8) of the UCC.
 
Equipment:   Any “equipment” as defined in Section 9-102(a)(33) of the UCC.
 
 
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ERISA:   The Employee Retirement Income Security Act of 1974, as amended.
 
ERISA Affiliate:   With respect to any Person, any other Person meeting the requirements of paragraphs (b), (c), (m) or (o) of Section 414 of the Code.
 
Event of Default:   With respect to any Series, the occurrence of any of the events or conditions designated as such as set forth in Section 801 of this Indenture.
 
Exchange Act:   The Securities Exchange Act of 1934, as amended.
 
Existing Commitment :  With respect to (A) each Series of Warehouse Notes (i) prior to its Conversion Date, the aggregate Initial Commitment to issue Notes, consisting of one or more classes, expressed as a dollar amount, as set forth in the related Supplement and subject to reduction from time to time in accordance with the related Supplement, and (ii) after its Conversion Date, the then unpaid principal balance of the Notes of such Series, and (B) each Series of Term Notes, the then unpaid principal balance of the Notes of such Series.
 
Expected Final Maturity Date:   With respect to any Series, the date on which the principal balance of the Outstanding Notes of such Series are expected to be paid in full.  The Expected Final Maturity Date for a Series shall be set forth in the related Supplement.
 
Fair Market Value:   An amount equal to the value which would be obtained in an arm’s length sales transaction between an informed and willing purchaser under no compulsion to buy and an informed and willing seller under no compulsion to sell.
 
Finance Lease:   A Lease pursuant to which the Manager leases Containers to a Lessee and (a) the terms of such lease provide that title to such Containers will pass to such Lessee at the end of the lease term automatically or at the option of the Lessee for no additional consideration or for consideration so nominal that the lessee would be economically compelled to exercise such option and (b) the interest component of the proceeds of such lease are booked on the Issuer’s financial statements as “Income from Direct Finance Leases” in accordance with GAAP.
 
Finance Lease Balance :  As of any date of determination, with respect to any Container that is then subject to an Eligible Finance Lease, an amount equal to the present value (determined using the Discount Rate) of the remaining Lease Payments becoming due under such Finance Lease after such date of determination; provided , however , that (i) the Finance Lease Balance of (A) any Finance Lease that is a Defaulted Lease or (B) a Finance Lease that has been repurchased or for which Seller has defaulted in its obligation to repurchase such Finance Lease shall, in each case, be equal to zero and (ii) with respect to any Lease Payment that remains unpaid for more than ninety (90) days (measured from its contractual due date), such Lease Payment shall be deemed to have a value of zero for purposes of calculating the Finance Lease Balance of such Finance Lease.
 
Financial Asset:   Any “financial asset” as such term is defined in Section 8-102(a)(9) of the UCC.
 
 
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Fleet:   As of any date of determination, both of the following collectively: (i) the Managed Containers and (ii) without duplication of clause (i), all other Containers then managed by Manager or CAI.
 
Funding Date:   Has the meaning set forth in the related Supplement.
 
General Intangibles:   Any “general intangible” as such term is defined in Section 9-102(a)(42) of the UCC.
 
Generally Accepted Accounting Principles or GAAP:   With respect to any Person, those generally accepted accounting principles and practices which are recognized as such by (i) the American Institute of Certified Public Accountants acting through its Accounting Principles Board or by the Financial Accounting Standards Board or through other appropriate boards or committees thereof consistently applied as to the party in question or (ii) such other equivalent entity(ies) that has or have authority for promulgating accounting principles and practices applicable to such Person; provided that for purposes of calculating depreciation of the Managed Containers for purposes of this Agreement only, the Depreciation Policy shall apply.
 
Governmental Authority:   Any of the following:  (i) any national, state or other sovereign government, and any federal, regional, state, provincial, local, city government or other political subdivision, (ii) any governmental or quasi-governmental agency, authority, board, bureau, commission, department, instrumentality or public body or (iii) any court or administrative tribunal.
 
Grant :  To grant, bargain, sell, convey, assign, transfer, mortgage, pledge, create and perfect a security interest in and right of set-off against, deposit, set over and confirm.
 
Holder:   See Noteholder.
 
Indebtedness:   As to any Person and whether recourse is secured by or is otherwise available against all or only a portion of the assets of such Person and whether or not contingent, but without duplication:
 
(a)           every obligation of such Person for money borrowed,
 
(b)           every obligation of such Person evidenced by bonds, debentures, notes or other similar instruments, including obligations incurred in connection with the acquisition of property, assets or businesses,
 
(c)           every reimbursement obligation of such Person with respect to letters of credit, bankers’ acceptances or similar facilities issued for the account of such Person,
 
(d)           every obligation of such Person issued or assumed as the deferred purchase price of property or services (including securities repurchase agreements but excluding trade accounts payable or accrued liabilities arising in the ordinary course of business which are not overdue or which are being contested in good faith),
 
(e)           every obligation of such Person under any Capitalized Lease,
 
(f)           every obligation of such Person under any Synthetic Lease,
 
 
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(g)           all sales by such Person of (i) accounts or general intangibles for money due or to become due, (ii) chattel paper, instruments or documents creating or evidencing a right to payment of money or (iii) other receivables (collectively “ receivables ”), whether pursuant to a purchase facility or otherwise, other than in connection with the disposition of the business operations of such Person relating thereto or a disposition of defaulted receivables for collection and not as a financing arrangement, and together with any obligation of such Person to pay any discount, interest, fees, indemnities, penalties, recourse, expenses or other amounts in connection therewith,
 
(h)           every obligation of such Person (an “ equity related purchase obligation ”) to purchase, redeem, retire or otherwise acquire for value any shares of Capital Stock issued by such Person or any rights measured by the value of such Capital Stock,
 
(i)            every obligation of such Person under any forward contract, futures contract, swap, option or other financing agreement or arrangement (including, without limitation, caps, floors, collars and similar agreements), the value of which is dependent upon interest rates, currency exchange rates, commodities or other indices (a “ derivative contract ”),
 
(j)            every obligation in respect of Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent that such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent that the terms of such Indebtedness provide that such Person is not liable therefor and such terms are enforceable under applicable law,
 
(k)           every obligation, contingent or otherwise, of such Person guaranteeing, or having the economic effect of guarantying or otherwise acting as surety for, any obligation of a type described in any of clauses (a) through (j) (the “ primary obligation ”) of another Person (the “ primary obligor ”), in any manner, whether directly or indirectly, and including, without limitation, any obligation of such Person (i) to purchase or pay (or advance or supply funds for the purchase of) any security for the payment of such primary obligation, (ii) to purchase property, securities or services for the purpose of assuring the payment of such primary obligation, or (iii) to maintain working capital, equity capital or other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such primary obligation, and
 
(l)            all Rental Obligations of such Person;
 
 
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provided , however , that, for the avoidance of doubt, any trade payables owing to manufacturers incurred in the ordinary course of business that is not delinquent shall not be deemed Indebtedness for the purposes of this definition.
 
The “ amount ” or “ principal amount ” of any Indebtedness at any time of determination represented by (i) any Indebtedness, issued at a price that is less than the principal amount at maturity thereof, shall be the amount of the liability in respect thereof determined in accordance with GAAP, (ii) any Capitalized Lease shall be the principal component of the aggregate of the rental obligation under such Capitalized Lease payable over the term thereof that is not subject to termination by the lessee, (iii) any sale of receivables shall be the amount of unrecovered capital or principal investment of the purchaser (other than the Issuer or any of its wholly-owned Subsidiaries) thereof, excluding amounts representative of yield or interest earned on such investment, (iv) any Synthetic Lease shall be the stipulated loss value, termination value or other equivalent amount, (v) any derivative contract shall be the maximum amount of any termination or loss payment required to be paid by such Person if such derivative contract were, at the time of determination, to be terminated by reason of any event of default or early termination event thereunder, whether or not such event of default or early termination event has in fact occurred, (vi) any equity related purchase obligation shall be the maximum fixed redemption or purchase price thereof inclusive of any accrued and unpaid dividends to be comprised in such redemption or purchase price, and (vii) any guaranty or other contingent liability referred to in clause (k) shall be an amount equal to the stated or determinable amount of the primary obligation in respect of which such guaranty or other contingent obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith.
 
Indenture:   This Indenture, dated as of October 18, 2012, between the Issuer and the Indenture Trustee and all amendments hereof   and supplements hereto, including, with respect to any Series or Class, the related Supplement.
 
Indenture Trustee:   The Person performing the duties of the Indenture Trustee under this Indenture.
 
Indenture Trustee Fee:   The compensation payable to the Indenture Trustee for its services under this Indenture and the other Related Documents to which it is a party, including, without limitation, all amounts owed to the Indenture Trustee pursuant to its Schedule of Fees dated September 14, 2012.  Indenture Trustee Fees do not include Indenture Trustee Indemnified Amounts.
 
Indenture Trustee Indemnified Amounts :  This term shall have the meaning set forth in Section 905 of the Indenture.
 
Independent Accountants:   KPMG LLP or other independent certified public accountants of internationally recognized standing selected by Issuer and acceptable to the Administrative Agent.
 
Independent Management Provider:     AMACAR Group LLC.
 
Independent Management Provider Fees :        $5,500 per annum.
 
Initial Commitment :  With respect to any Series, the aggregate initial commitment, expressed as a dollar amount, to purchase up to a specified principal balance of all Classes of such Series, which commitments shall be set forth in the related Supplement.
 
Insolvency Law:   Each of the Bankruptcy Code, the Companies Act 1981 of Bermuda, the Bankruptcy Code and Insolvency Act of Barbados or other similar Applicable Law in any other applicable jurisdiction.
 
Insolvency Proceeding:   Any Proceeding under any applicable Insolvency Law.
 
 
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Instrument:   Any “instrument,” as such term is defined in Section 9-102(a)(47) of the UCC.
 
Intangible Assets :  Assets that are considered to be intangible assets under GAAP, including customer lists, goodwill, computer software, copyrights, trade names, trademarks, patents, franchises, licenses, unamortized deferred charges, unamortized debt discount and capitalized research and development costs.
 
Intercreditor Collateral Agreement :  The Intercreditor Collateral Agreement (as amended, modified or supplemented from time to time), dated as of December 20, 2010, by and among CAI, the Issuer, certain “Lenders”, “Owners”, the “Revolver Agent”, the “Collateral Agent” (as each such term is defined therein) and certain other Persons that from time to time become party thereto.  A copy of the Intercreditor Collateral Agreement is attached as Exhibit F hereto.
 
Interest Expense:   For any period, the aggregate amount of interest expense as shown for such period on the income statement of the Issuer, determined in accordance with GAAP.
 
Interest Payment :   For each Series of Notes Outstanding on any Payment Date, all amounts to be paid from the related Series Account on such Payment Date which represent payments of (i) interest on such Series of Notes and (ii) commitment fees or deal agent fees payable to the Holders of such Series of Notes.
 
Interest Rate Hedge Agreement:   This term shall have the meaning set forth in the related Supplement.
 
Interest Rate Hedge Provider:   This term shall have the meaning set forth in the related Supplement; provided , that each Interest Rate Hedge Provider must be an Eligible Interest Rate Hedge Counterparty.
 
Inventory:   Any “inventory,” as such term is defined in Section 9-102(a)(48) of the UCC.
 
Investment:   When used in connection with any Person, any investment by or of that Person, whether by means of purchase or other acquisition of securities of any other Person or by means of loan, advance, capital contribution, guaranty or other debt or equity participation or interest in any other Person including any partnership and joint venture interests of each Person in any other Person.  The amount of any Investment shall be the original principal or capital amount thereof, plus additional paid in capital (including, without limitation, share premium and contributed surplus), plus retained earnings, less all returns of principal or equity thereon (and without adjustment by reason of the financial condition of such other Person) and shall, if made by the transfer or exchange of property other than cash, be deemed to have been made in an original principal or capital amount equal to the fair market value of such property.
 
Investment Property:   Any “investment property” as such term is defined in Section 9-102(a)(49) of the UCC.
 
 
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Issuer:   CAL Funding II Limited, an exempted company with limited liability incorporated and existing under the laws of Bermuda.
 
Issuer Expenses:   For any Collection Period an amount equal to overhead and all other costs, expenses and liabilities of the Issuer (other than Operating Expenses paid pursuant to the Management Agreement and any Management Fee) payable during such Collection Period (including costs and expenses permitted to be paid to or by the Manager in connection with the conduct of the Issuer’s business), in each case determined on a cash basis, including but not limited to the following:
 
 
(A)
administration expenses;
 
 
(B)
accounting and audit expenses of the Issuer, and tax preparation, filing and audit expenses of the Issuer;
 
 
(C)
premiums for liability, casualty, fidelity, directors and officers and other insurance;
 
 
(D)
directors’ fees and expenses;
 
 
(E)
legal fees and expenses;
 
 
(F)
other professional fees;
 
 
(G)
taxes (including personal or other property taxes and all sales, value added, use and similar taxes but excluding any such amounts that are included as an Operating Expense);
 
 
(H)
taxes imposed in respect of any and all issuances of equity interests, stock exchange listing fees, registrar and transfer expenses and trustee’s fees with respect to any outstanding securities of the Issuer; and
 
 
(I)
surveillance fees assessed by the Rating Agencies.
 
Notwithstanding the foregoing, Issuer Expenses shall not include (i) depreciation or amortization on the Managed Containers, (ii) payments of principal, interest and premium, if any, on or with respect to the Notes, or (iii) funds used to acquire additional Containers.  In no event shall the Manager be obligated to pay any Issuer Expenses from its own funds.
 
Issuer Proceeds :  This term shall have the meaning set forth in the Management Agreement.
 
 
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Lease:   A lease for one or more Containers between CAL (as agent on behalf of Issuer) or CAI (as agent on behalf of Issuer) as Lessor, and the user of such Container(s), as Lessee, which is administered by CAL or CAI (as the case may be) as agent of Issuer.  A Lease may cover one or more containers from CAI's and CAL's Fleet in addition to Issuer’s Container(s).
 
Lease Payment .  The minimum periodic contractual payment to be made by the Lessee for the use of the related equipment.
 
Legal Final Maturity Date :  With respect to any Series, the date set forth in the related Supplement on which the unpaid principal balance of, and accrued interest on, the Notes of such Series will be due and payable.  The Legal Final Maturity Date for a Series shall be set forth in the related Supplement.
 
Lessee :  Each lessee that leases a Container pursuant to a Lease.
 
Letter of Credit Right:   Any “letter-of-credit right,” as such term is defined in Section 9-102(a)(51) of the UCC.
 
LIBOR Rate :  This term shall have the meaning set forth in the related Supplement.
 
Lien:   Any   security interest, lien, charge, pledge, equity or encumbrance of any kind.
 
Managed Containers:   As of any date of determination, all Containers then owned by the Issuer.
 
Management Agreement:   The Container Management Services Agreement, dated as of the Closing Date, among the Manager, the Sub-Manager and the Issuer, as such agreement shall be amended, supplemented or modified from time to time in accordance with its terms.
 
Management Fee:   The term shall have the meaning as set forth in the definition of “Total Manager Fees” in the Management Agreement.
 
Management Fee Arrearage:   For any Payment Date, an amount equal to any unpaid Management Fee from all prior Collection Periods.
 
Manager:   The Person performing the duties of the Manager under the Management Agreement; initially, CAL.
 
Manager Collection Account :  The term shall have the meaning as set forth in the Intercreditor Agreement.
 
Manager Advance:   The term shall have the meaning as set forth in the Management Agreement.
 
Manager Default:   The occurrence of any of the events or conditions designated as an “Event of Default” in the Management Agreement.
 
Manager Report:   A certificate and written informational statement, substantially in the form attached to the Management Agreement, and signed and certified by an Authorized Signatory of the Manager or one of its permitted Affiliates on behalf of the Manager in accordance with the Management Agreement.
 
 
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Manager Termination Notice:   A   written notice to be provided to the Manager and other specified Persons pursuant to Section 413 of the related Supplement.
 
Manager Transfer Facilitator :  The Person performing the duties of the Manager Transfer Facilitator under the Manager Transfer Facilitator Agreement; initially, Wells Fargo Bank, National Association.
 
Manager Transfer Facilitator Agreement :  The Manager Transfer Facilitator Agreement, dated as of the Closing Date, by and among the Manager Transfer Facilitator, the Issuer and the Indenture Trustee, as such agreement shall be amended, supplemented or modified from time to time in accordance with its terms.
 
Manager Transfer Facilitator Fee :  This term shall have the meaning set forth in the Manager Transfer Facilitator Agreement.
 
Managing Officer :   Any representative of the Manager involved in, or responsible for, the management of the day-to-day operations of the Issuer and the administration and servicing of the Managed Containers whose name appears on a list of managing officers furnished to Issuer and the Indenture Trustee by the Manager, as such list may from time to time be amended.
 
Material Adverse Change:   Any set of circumstances or events which (i) has, or could reasonably be expected to have, any material adverse effect whatsoever upon the validity or enforceability of any Related Document or the security for any of the Notes, (ii) is, or could reasonably be expected to be, material and adverse to the condition (financial or otherwise) or business operations of Issuer or Manager, individually or taken together as a whole, (iii) materially impairs, or could reasonably be expected to materially impair, the ability of Issuer or Manager to perform any of their respective obligations under the Related Documents, or (iv) materially impairs, or could reasonably be expected to materially impair, the ability of the Indenture Trustee to enforce any of its legal rights or remedies pursuant to the Related Documents.
 
Maximum Principal Withdrawal Amount:   With respect to the Legal Final Maturity Date of any Series, an amount equal to the product of (i) all funds and Eligible Investments on deposit in the Restricted Cash Account on such Payment Date (calculated after giving effect to the disbursements to be made from the Restricted Cash Account on such Payment Date to pay interest shortfalls on all Series of Notes) and (ii) a fraction, the numerator of which is the then unpaid principal balance of the Series for which the Legal Final Maturity Date has occurred and the denominator of which is the then Aggregate Principal Balance.
 
Minimum Principal Payment Amount:   With respect to any Series, the amount identified as such in the related Supplement.
 
Moody’s:   Moody’s Investors Service, Inc. and any successor thereto.
 
Net Book Value:   With respect to a Managed Container that is not subject to Finance Lease, as of any date of determination, an amount equal to the Original Equipment Cost of such Container, less any accumulated depreciation, calculated utilizing the Depreciation Policy; provided, however, that if such Container has been recovered from a Lessee under a defaulted Finance Lease, the Net Book Value of such Container shall be determined in accordance with GAAP.
 
 
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Net Income:   With respect to a Person, net income (or deficit) of such Person, after deduction of all expenses, taxes, and other proper charges, determined in accordance with GAAP , after eliminating therefrom all extraordinary items of income or loss.
 
Noteholder or Holder:   The Person in whose name a Note is registered in the Note Register, except that, solely for the purposes of giving any consent, waiver, request or demand, the interest evidenced by any Note registered in the name of the Seller, the Issuer or any Affiliate of any of them known to be such an Affiliate by the Indenture Trustee shall not be taken into account in determining whether the requisite percentage of the Aggregate Principal Balance of the Outstanding Notes necessary to effect any such consent, waiver, request or demand is represented.
 
Note Purchase Agreement:   Any underwriting agreement or other agreement for the Notes of any Series or Class.
 
Note Register:   The register maintained by the Indenture Trustee pursuant to Section 205(a) of this Indenture.
 
Note Registrar:   This term shall have the meaning set forth in Section 205(a) of this Indenture.
 
Notes:   One or more of the promissory notes or other securities executed by the Issuer pursuant to this Indenture and authenticated by, or on behalf of, the Indenture Trustee, substantially in the form attached to the related Supplement.
 
OFAC : The Office of Foreign Assets Control of the United States Department of the Treasury.
 
Officer’s Certificate:   A certificate signed by a duly authorized officer of the Person who is required to sign such certificate.
 
Operating Expenses:   This term shall have the meaning set forth in the Management Agreement.
 
Opinion of Counsel:   A written opinion of counsel, in each case reasonably acceptable to the Person or Persons to whom such Opinion of Counsel is to be delivered.  Unless otherwise specified, the counsel rendering such opinion may be counsel employed by the Issuer, the Seller, or the Manager, as the context may require.  The counsel rendering such opinion may rely (i) as to factual matters, on a certificate of a Person whose duties relate to the matters being certified, and (ii) insofar as the opinion relates to local law matters, upon opinions of local counsel.
 
Original Equipment Cost:   With respect to each Container, an amount equal to the sum of (i) the vendor’s or manufacturer’s invoice price of the related Container and any rebates thereon, (ii) all reasonable and customary inspection, transport, and initial positioning costs necessary to put such Container in service and (iii) reasonable acquisition fees and other fees not to exceed 2.5% of the amounts described in clauses (i) and (ii) above.
 
 
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Outstanding:   When used with reference to the Notes and as of any particular date, any Note theretofore and thereupon being authenticated and delivered except:
 
(i)             any Note canceled by the Indenture Trustee or proven to the satisfaction of the Indenture Trustee to have been duly canceled by the Issuer at or before said date;
 
(ii)            any Note, or portion thereof, called for payment or redemption for which monies equal to the principal amount or redemption price thereof, as the case may be, with interest to the date of maturity or redemption, shall have theretofore been deposited with the Indenture Trustee (whether upon or prior to maturity or the redemption date of such Note);
 
(iii)           any Note in lieu of or in substitution for which another Note shall subsequently have been authenticated and delivered; and
 
(iv)           for purposes of determining which Notes are entitled to vote with respect to a particular matter, any Note held by the Issuer, the Seller or any Affiliate of either the Issuer or Seller, except that, in determining whether the Indenture Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Notes that a Responsible Officer of the Indenture Trustee actually has notice are so owned shall be so disregarded.
 
Outstanding Obligations:   As of any date of determination for any Series of Notes issued under this Indenture or any Supplement thereto, an amount equal to the sum of (i) all accrued interest payable on such Series of Notes (including, for any Series of Notes for which the related Noteholder has funded or maintains its investment through the issuance of commercial paper, interest accrued through the last maturing tranche, interest or fixed period, as applicable), (ii) the then outstanding   principal balance of such Series of Notes, (iii) all other amounts owing by the Issuer to Noteholders or to any Person under this Indenture or any Supplement hereto and (iv) amounts owing by the Issuer under any Interest Rate Hedge Agreement.
 
Overdue Rate:   The rate of interest specified in the related Supplement applicable to a Note then earning Default Interest, but in no event to exceed two percent (2%) over the interest rate per annum otherwise then applicable to such Note.
 
Ownership Interest:   An ownership interest in a Book-Entry Note.
 
Payment Date:   With respect to any Series, the twenty-fifth (25th) calendar day of each calendar month; provided , however , if such day is not a Business Day, then the immediately succeeding Business Day.
 
Performance Guaranty :  The performance guaranty, dated as of the Closing Date, made by CAI with respect to the performance of CAL in its capacity as Manager.
 
 
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Permitted Encumbrance:   With respect to the Collateral, any of the following:  (i) Liens for taxes not yet due or which are being contested in good faith by appropriate Proceedings and for the payment of which adequate reserves are provided by the Manager; (ii) with respect to the Managed Containers, carriers’, warehousemen’s, mechanics’, or other like Liens arising in the ordinary course of business and relating to amounts not yet due or which shall not have been overdue for a period of more than sixty (60) days or which are being contested in good faith by appropriate Proceedings and for the payment of which adequate reserves are provided for by the Manager; (iii) with respect to the Managed Containers, Leases entered into in the ordinary course of business providing for the leasing of Managed Containers; (iv) Liens created by this Indenture; (v) the rights of the Manager under the Management Agreement and (vi) the Intercreditor Collateral Agreement; provided, however, that Proceedings described in (i) and (ii) above could not reasonably subject the Indenture Trustee or the Noteholders to any civil or criminal penalty or liability or involve any material risk of loss, sale or forfeiture of any of the Collateral.
 
Permitted Payment Date Withdrawals:   Both of the following with respect to each Series of Notes: (i) on any Payment Date other than the Legal Final Maturity Date for a Series of Notes, the amounts required to pay any shortfall in interest on each Series of Notes (calculated after giving effect to the application of all Available Distribution Amounts on such Payment Date); and (ii) on the Legal Final Maturity Date for a Series of Notes, the amount (not to exceed the Maximum Principal Withdrawal Amount for such Series of Notes) required to pay any shortfall in the unpaid principal balance of such Series of Notes (calculated after giving effect to the application of the Available Distribution Amount on such Payment Date).
 
Person:   An individual, a partnership, a limited liability company, a corporation, a joint venture, an unincorporated association, a joint-stock company, a trust, or other entity or a Governmental Authority.
 
Plan:   An “employee benefit plan,” as such term is defined in Section 3(3) of ERISA, or a plan described in Section 4975(e)(1) of the Code of the Issuer or its ERISA Affiliates, in either case, which plan is subject to Title IV of ERISA.
 
Pre-Funding Account:   This term shall have the meaning set forth in Section 307 of this Indenture.
 
Prepayment:   Any mandatory or optional prepayment of principal of any Series of Notes prior to the Expected Final Maturity Date of such Series including, without limitation, any prepayment made in accordance with the provisions of Article VII of this Indenture.
 
Principal Terms:   With respect to any Series, (i) the name or designation of such Series; (ii) the initial principal amount of the Notes to be issued for such Series (or method for calculating such amount) and the Minimum Principal Payment Amounts and the Scheduled Principal Payment Amount for each Payment Date (or method for calculating such amount); (iii) the interest rate to be paid with respect to each Class of Notes for such Series (or method for the determination thereof); (iv) the Payment Date and the date or dates from which interest shall accrue and principal shall be paid; (v) the designation of any Series Accounts and the terms governing the operation of any such Series Accounts including the Permitted Payment Date Withdrawals with respect to such Series; (vi) the terms of any form of series enhancement with respect thereto; (vii) the Expected Final Maturity Date for the Series; (viii) the Legal Final Maturity Date for the Series; (ix) the number of Classes of Notes of the Series and, if the Series consists of more than one Class, the rights and priorities of each such Class; (x) the priority of the Series with respect to any other Series; (xi) the designation of such Series on its Series Issuance Date as either a Term Note or a Warehouse Note; and (xii) the Control Party with respect to such Series; and (xiii) any other terms of such Series.
 
 
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Proceeding:   Any suit in equity, action at law, or other judicial or administrative proceeding.
 
Proceeds:   Any   “proceeds,” as such term is defined in Section 9-102(a)(64) of the UCC.
 
Prohibited Jurisdiction:   Any country or jurisdiction, from time to time, that is the subject of a prohibition order (or any similar order or directive), sanctions or restrictions promulgated or administered by the Office of Foreign Assets Control of the United States Treasury Department.
 
Prohibited Person:   Any of the following currently or in the future: (i) a person named on the list of Specially Designated Nationals or Blocked Persons maintained by OFAC available at http://www.treas.gov/offices/eotffc/ofac/sdn/index.html, or (ii) (A) an agency of the government of a Prohibited Jurisdiction, (B) an organization controlled by a Prohibited Jurisdiction, or (C) a person resident in a Prohibited Jurisdiction, to the extent the agency, organization, or person is subject to a sanctions program administered by OFAC.
 
Prospective Owner:   This term shall have the meaning as set forth in Section 205(h) of this Indenture.
 
Purchaser Letter:   This term shall have the meaning set forth in Section 205(i) of this Indenture.
 
Rating Agency or Rating Agencies:   With respect to any Outstanding Series, each statistical rating agency selected by the Issuer to rate such Series which has an outstanding rating with respect to such Series.
 
Rating Agency Condition :   With respect to (A) the issuance of an additional Series, (B) any Change of Control (as defined in the Management Agreement or any Supplement) or (C) any other action specified in any Related Document which requires the affirmative approval or consent of each Rating Agency, the confirmation issued in writing by each Rating Agency that has issued an outstanding rating with respect to any Series of Notes then Outstanding that the rating(s) on such existing Series will not be downgraded or withdrawn as the result of the issuance of such additional Series, Change of Control (as defined in the Management Agreement or any Supplement) or other action and (ii) with respect to any other action, means that each Rating Agency that has issued an outstanding rating with respect to any Series of Notes then Outstanding shall have been given ten (10) Business Days (or such shorter period as is practicable or acceptable to each Rating Agency) prior notice thereof and within ten (10) Business Days of each Rating Agency’s receipt of such notice (or such shorter period as is practicable or acceptable to each Rating Agency) such Rating Agency shall not have notified the Seller, the Indenture Trustee or the Issuer in writing that such action will result in a downgrade, qualification or withdrawal of any such outstanding rating.
 
 
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Record Date:   With respect to any Payment Date, the last Business Day of the month preceding the month in which the related Payment Date occurs, except as otherwise provided with respect to a Series in the related Supplement.
 
Regulation S Book-Entry Notes: Collectively, the Unrestricted Book-Entry Notes and the Regulation S Temporary Book-Entry Notes.
 
Regulation S Temporary Book-Entry Notes: The temporary book-entry notes in fully registered form without coupons that represent the Notes sold in offshore transactions within the meaning of and in compliance with Regulation S under the Securities Act and which will be registered with the Depositary.
 
Related Documents:   With respect to any Series, the Contribution and Sale Agreement, this Indenture, the related Supplement, the Notes of such Series, the Note Purchase Agreement for such Series, the Management Agreement, the Performance Guaranty, the Intercreditor Collateral Agreement, each Interest Rate Hedge Agreement (upon execution thereof), each premium letter and each other document or instrument executed in connection with the issuance of any Series, as any of the foregoing may from time to time be amended, modified, supplemented or renewed.
 
Released Assets:   This term shall have the meaning set forth in the Contribution and Sale Agreement.
 
Released Containers:   This term shall have the meaning set forth in the Contribution and Sale Agreement.
 
Rental Obligations :  All present or future obligations of CAI or any of its Subsidiaries under any rental agreements or leases of real or personal property, other than (a) obligations that can be terminated by the giving of notice without liability to CAI or such Subsidiary in excess of the liability for rent due as of the date on which such notice is given and under which no penalty or premium is paid as a result of any such termination, (b) obligations under rental agreements relating to equipment other than Containers or chassis having an aggregate value of less than $5,000,000 for all such agreements, (c) obligations in respect of any Capitalized Leases, (d) any obligations incurred in a lease transaction where the obligation of CAI or its Subsidiary to pay rent thereunder is limited to a pass-through of net rental amounts received by CAI or its Subsidiaries from a sublessee of container equipment under such transaction ("net sublease rentals"), so that if there are no net sublease rental amounts received by CAI or its Subsidiaries from a sublessee then CAI or its Subsidiaries would have no obligation to make any rental payment under or in connection with such transaction, shall not constitute a Rental Obligation hereunder; and (e) obligations under the lease of commercial office properties in the conduct of the business of CAI or its Subsidiaries shall not be deemed a Rental Obligation hereunder.  For purposes of this Credit Agreement, the aggregate amount of Rental Obligations of CAI and its Subsidiaries shall, as at any date of determination, be an amount equal to the net present value, calculated at a discount rate of nine percent (9.00%) per annum, of the future Rental Obligations of such Person.
 
 
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Replacement Manager :  Any Person appointed to replace the then Manager as manager of the Managed Containers in accordance with, and subject to the terms of, the Management Agreement, which Person shall be acceptable to the Requisite Global Majority.
 
Reportable Event:   This term shall have the meaning given to such term in ERISA.
 
Required Deposit Rating :  With regard to an institution, the short-term unsecured senior debt rating of such institution is in the highest category by each Rating Agency (“P-1” by Moody’s and “A-1” by Standard & Poor’s, or such lower rating as will not result in the downgrading or withdrawal of the ratings of the Notes).
 
Requisite Global Majority:   As of any date of determination, the determination of whether a Requisite Global Majority exists with respect to a particular course of action shall be determined in accordance with Section 503 of this Indenture.
 
Restricted Cash Account:   This term shall have the meaning set forth in Section 306 of this Indenture.
 
Restricted Cash Amount:   As of any Payment Date, the amount required to be deposited or maintained in the Restricted Cash Account, which shall be equal to the product of (a) nine (9), (b) one-twelfth, (c) the weighted average (based on the then Aggregate Principal Balance, calculated after giving effect to any principal payments paid on such Payment Date) of the annual rates of interest payable on all Series of Notes then Outstanding (or, if any Series bears interest at a variable rate of interest, the interest rate then in effect on such Series of Notes), and (d) the Aggregate Principal Balance, calculated after giving effect to all advances of principal and principal payments made on such Payment Date; provided, however , that, on any Payment Date on or after the Conversion Date for any Series of Warehouse Notes, if there is an incremental increase in the weighted average of the annual rates of interest in clause (c) above resulting from such Conversion Date, then any resulting increase in the required amount of the Restricted Cash Amount shall be deposited or maintained in the Restricted Cash Account, in equal amounts, over the course of three (3) consecutive Payment Dates (commencing on such Payment Date).
 
Rule 144A:   Rule 144A under the Securities Act, as such Rule may be amended from time to time.
 
Rule 144A Book-Entry Notes: The permanent book-entry notes in fully registered form without coupons that represent the Notes sold in reliance on Rule 144A and which will be registered with the Depositary.
 
Sale:   This term shall have the meaning set forth in Section 816 of this Indenture.
 
Sales Proceeds:   This term shall have the meaning set forth in the Management Agreement.
 
 
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Scheduled Principal Payment Amount:   With respect to any Series of Notes, the amount identified as such in the related Supplement.
 
Securities Account:   Any “securities account,” as such term is defined in Section 8-501 of the UCC.
 
Securities Act:   The Securities Act of 1933, as amended from time to time.
 
Securities Entitlement:   Any “securities entitlement,” as such term is defined in Section 8-102(a)(17) of the UCC.
 
Securities Intermediary:   Any “securities intermediary”, as such term is defined in Section 8-102 of the UCC.
 
Seller:   CAL.
 
Series:   Any series of Notes established pursuant to a Supplement.
 
Series Account:   Any deposit, trust, escrow or similar account maintained for the benefit of the Noteholders of any Series or Class as specified in the related Supplement.
 
Series Enhancer :  With respect to any Series, a party that provides credit support to enhance the credit rating of the Issuer.
 
Series Issuance Date:  With respect to any Series, the date on which the Notes of such Series are to be originally issued in accordance with Section 1006 of this Indenture and the related Supplement.
 
Shareholders’ Equity :  As of any date of determination, the consolidated shareholders’ equity of Sub-Manager and its Subsidiaries as of that date determined in accordance with GAAP.
 
Standard & Poor’s :  Standard and Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and any successor thereto.
 
Subsidiary :  A subsidiary of a Person means any corporation, association, partnership, limited liability company, joint venture or other business entity of which more than fifty percent (50.0%) of the voting stock or other equity interests (in the case of Persons other than corporations) is owned or controlled directly or indirectly by such Person, or one or more of the Subsidiaries of such Person, or a combination thereof.
 
Sub-Manager :  CAI.
 
Supplement:   Any supplement to the Indenture executed in accordance with Article X of this Indenture.
 
Supplemental Principal Payment Amount :  With respect to any Series of Notes on any Payment Date, an amount equal to the excess, if any, of (x) the then Aggregate Principal Balance (after giving effect to all payments of Minimum Principal Payment Amounts and Scheduled Principal Payment Amounts actually paid on such Payment Date), over (y) the Asset Base on such Payment Date.
 
 
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Supporting Obligation:    Any “supporting obligation” as defined in Section 9-102(a)(77) of the UCC.
 
Swap Contract :  (a) Any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “ Master Agreement ”), including any such obligations or liabilities under any Master Agreement.
 
Synthetic Lease :  Any lease of goods or other property, whether real or personal, which is treated as an operating lease under GAAP and as a loan or financing for U.S. income tax purposes.
 
Term Note :  Any Note that pays principal and interest on each Payment Date from and after its date of issuance.
 
Terminated Container : This term shall have the meaning set forth in the Management Agreement.
 
Transfer Date:   The date on which a container is contributed or sold by the Seller to the Issuer pursuant to the terms of the Contribution and Sale Agreement.
 
Transferred Assets:   This term shall have the meaning set forth in the Contribution and Sale Agreement.
 
Trust Account:   The account or accounts established by the Indenture Trustee, in the name of the Indenture Trustee, for the benefit of the Noteholders and each Interest Rate Hedge Provider pursuant to Section 302   hereof.
 
UCC :  The Uniform Commercial Code as the same may, from time to time, be in effect in the State of New York; provided, however, in the event that, by reason of mandatory provisions of law, any   or all of the attachment, perfection or priority of Indenture Trustee’s security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, the term “UCC” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection of priority and for purposes of definitions related to such provisions.
 
 
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Unrestricted Book-Entry Notes:   The permanent book-entry notes in fully registered form without coupons that are exchangeable for Regulation S Temporary Book-Entry Notes after the expiration of the 40-day distribution compliance period and which will be registered with the Depositary.
 
Warehouse Note :  Any Series of Notes that has a revolving period during which periodic payments of principal are not scheduled to be paid.
 
Warranty Purchase Amount:   This term shall have the meaning set forth in the Contribution and Sale Agreement.
 
Weighted Average Age:   For any date of determination shall be equal to the quotient of (A) the sum of the products of (i) the age in years (determined from the date of the initial sale thereof by the manufacturer) of each Managed Container being evaluated, multiplied by (ii) the Net Book Value or Finance Lease Balance, as applicable, of such Managed Container being evaluated, divided by (B) the sum of the Net Book Values and Finance Lease Balances of all Managed Containers being evaluated.
 
Section 102.                 Other Definitional Provisions .
 
(a)     With respect to any Series, all terms used herein and not otherwise defined herein shall have meanings ascribed to them in the related Supplement.
 
(b)       (c)   As used in this Indenture and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in this Indenture or in any such certificate or other document, and accounting terms partly defined i n this Indenture or i n any such certificate or other document to the extent not defined, shall have the respective meanings given to them under GAAP, consistently applied.  To the extent that the definitions of accounting terms in this Indenture or in any such certificate or other document are inconsistent with the meanings of such terms under GAAP or regulatory accounting principles, the definitions contained in this Indenture or in any such certificate or other document shall control.
 
(d)       With respect to any Collection Period, the “related Record Date,” the “related Determination Date,” and the “related Payment Date,” shall mean the Record Date occurring on the last Business Day of such Collection Period and the Determination Date and Payment Date occurring in the month immediately following the end of such Collection Period.
 
(e)       With respect to any Series of Notes, the “related Supplement” shall mean the Supplement pursuant to which such Series of Notes is issued.
 
 
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(f)       References to the financial statements of CAI shall mean the financial statements of CAI and its consolidated Subsidiaries.
 
(g)       With respect to any ratio analysis required to be performed as of the most recently completed fiscal quarter, the most recently completed fiscal quarter shall mean the fiscal quarter for which financial statements were required hereunder to have been delivered.
 
(h)       With respect to the calculation of any financial ratio set forth in this Indenture or any other Related Document, the components of such calculations are to be determined in accordance with GAAP, consistently applied, with respect to the Issuer or the Manager, as the case may be.
 
Section 103.                 Computation of Time Periods .
 
Unless otherwise stated in this Indenture or any Supplement issued pursuant to the terms hereof, in the computation of a period of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each means “to but excluding.”
 
Section 104.                 Statutory References .
 
References in this Indenture and any other Related Document to any section of the UCC shall mean, on or after the effective date of adoption of any revision to the UCC in the applicable jurisdiction, such revised or successor section thereto.
 
Section 105.                 Duties of Administrative Agent and Manager Transfer Facilitator .
 
All of the duties and responsibilities of the Administrative Agent and Manager Transfer Facilitator set forth in this Indenture, any Supplement or any other Related Document issued pursuant hereto are subject in all respects to the terms and conditions of the Note Purchase Agreement and the Manager Transfer Facilitator Agreement, respectively.  Each of the Issuer, the Indenture Trustee and, by acceptance of its Notes, each Noteholder hereby acknowledges the terms of the Note Purchase Agreement and the Manager Transfer Facilitator Agreement, respectively, and agrees to cooperate with the Administrative Agent and the Manager Transfer Facilitator in their execution of its respective duties and responsibilities.
 
ARTICLE II
 
THE NOTES
 
Section 201.                 Authorization of Notes .
 
(a)        The number of Series or Classes of Notes which may be created by this Indenture is not limited; provided , however , that, the issuance of any Series of Notes shall not result in, or with the giving of notice or the passage of time or both would result in, the occurrence of an Early Amortization Event.  The aggregate principal amount of Notes of each Series which may be issued, authenticated and delivered under this Indenture is not limited except as shall be set forth in any Supplement and as restricted by the provisions of this Indenture.
 
 
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(b)       The Notes issuable under this Indenture shall be issued in such Series, and such Class or Classes within a Series, as may from time to time be created by a Supplement pursuant to this Indenture.  Each Series shall be created by a different Supplement and shall be designated to differentiate the Notes of such Series from the Notes of any other Series.
 
(c)       Upon satisfaction of and compliance with the requirements and conditions to closing set forth in the related Supplement, Notes of the Series to be executed and delivered on a particular Series Issuance Date pursuant to such related Supplement, may be executed by the Issuer and delivered to the Indenture Trustee for authentication following the execution and delivery of the related Supplement creating such Series or from time to time thereafter, and the Indenture Trustee shall authenticate and deliver Notes upon an Issuer request set forth in an Officer’s Certificate of the Issuer signed by one of its Authorized Signatories, without further action on the part of the Issuer.
 
Section 202.                  Form of Notes; Book-Entry Notes .
 
(a)       Notes of any Series or Class may be issued, authenticated and delivered, at the option of the Issuer, as Regulation S Book-Entry Notes, Rule 144A Book-Entry Notes, or as Definitive Notes or as may otherwise be set forth in a Supplement and shall be substantially in the form of the exhibits attached to the related Supplement.  Notes of each Series shall be dated the date of their authentication and shall bear interest at such rate, be payable as to principal, premium, if any, and interest on such date or dates, and shall contain such other terms and provisions as shall be established in the related Supplement.  Except as otherwise provided in any Supplement, the Notes shall be issued in minimum denominations of $250,000 and in integral multiples of $1,000 in excess thereof; provided that one Note of each Class may be issued in a nonstandard denomination.
 
(b)       If the Issuer shall choose to issue Regulation S Book-Entry Notes or Rule 144A Book-Entry Notes, such notes shall be issued in the form of one or more Regulation S Book-Entry Notes or one or more Rule 144A Book-Entry Notes which (i) shall represent, and shall be denominated in an aggregate amount equal to, the aggregate principal amount of all Notes to be issued hereunder, (ii) shall be delivered as one or more Notes held by the Book-Entry Custodian, or, if appointed to hold such Notes as provided below, the Notes shall be registered in the name of the Depositary or its nominee, (iii) shall be substantially in the form of the exhibits attached to the related Supplement, with such changes therein as may be necessary to reflect that each such Note is a Book-Entry Note, and (iv) shall each bear a legend substantially to the effect included in the form of the exhibits attached to the related Supplement.
 
(c)       Notwithstanding any other provisions of this Section 202 or of Section 205, unless and until a Book-Entry Note is exchanged in whole for Definitive Notes, a Book-Entry Note may be transferred, in whole, but not in part, and in the manner provided in this Section 202, only by (i) the Depositary to a nominee of such Depositary, or (ii) by a nominee of such Depositary to such Depositary or another nominee of such Depositary or (iii) by such Depositary or any such nominee to a successor Depositary selected or approved by the Issuer or to a nominee of such successor Depositary or in the manner specified in Section 202(d).  The Depositary shall order the Note Registrar to authenticate and deliver any Book-Entry Notes and any Book-Entry Note for each Class of Notes having an aggregate initial outstanding principal balance equal to the initial outstanding balance of such Class.  Noteholders shall hold their respective Ownership Interests in and to such Notes through the book-entry facilities of the Depositary.  Without limiting the foregoing, any Book-Entry Noteholders shall hold their respective Ownership Interests, if any, in Book-Entry Notes only through Depositary Participants.
 
 
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(d)       If (i) the Issuer elects to issue Definitive Notes, (ii) the Depositary for the Notes represented by one or more Book-Entry Notes at any time notifies the Issuer that it is unwilling or unable to continue as Depositary of the Notes or if at any time the Depositary shall no longer be a clearing agency registered under the Exchange Act and any other applicable statute or regulation, and a successor Depositary is not appointed or approved by the Issuer within 90 days after the Issuer receives such notice or becomes aware of such condition, as the case may be, (iii) the Indenture Trustee, at the written direction of the Noteholders representing more than 50% of the outstanding principal balance of the Notes, elects to terminate the book-entry system through the Depositary or (iv) after an Event of Default or a Manager Default, Noteholders notify the Depositary, or Book-Entry Custodian, as the case may be, in writing that the continuation of a book-entry system through the Depositary, or the Book-Entry Custodian, as the case may be, is no longer in the Noteholders’ best interest, upon the request of the Noteholders, the Issuer will promptly execute, and the Indenture Trustee, upon receipt of an Officer’s Certificate evidencing such determination by the Issuer, will promptly authenticate and make available for delivery, Definitive Notes, in authorized denominations and in an aggregate principal amount equal to the principal amount of the Book-Entry Note then outstanding in exchange for such Book-Entry Note or as an original issuance of Notes and this Section 202(d) shall no longer be applicable to the Notes.  Upon the exchange of the Book-Entry Notes for such Definitive Notes without coupons, in authorized denominations, such Book-Entry Notes shall be canceled by the Indenture Trustee.  All Definitive Notes shall be issued without coupons.  Such Definitive Notes issued in exchange of the Book-Entry Notes pursuant to this Section 202(d) shall be registered in such names and in such authorized denominations as the Depositary, in the case of an exchange, or the Note Registrar, in the case of an original issuance, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Indenture Trustee.  The Indenture Trustee may conclusively rely on any such instructions furnished by the Depositary or the Note Registrar, as the case may be, and shall not be liable for any delay in delivery of such instructions.  The Indenture Trustee shall make such Notes available for delivery to the Persons in whose names such Notes are so registered.
 
(e)       As long as the Notes outstanding are represented by one or more Book-Entry Notes:
 
(i)           the Note Registrar and the Indenture Trustee may deal with the Depositary for all purposes (including the payment of principal of and interest on the Notes) as the authorized representative of the Noteholders;
 
(ii)       the rights of Noteholders shall be exercised only through the Depositary and shall be limited to those established by law and agreements between such Noteholders and the Depositary and/or the Depositary Participants.  Unless and until Definitive Notes are issued, the Depositary will make book-entry transfers among the Depositary Participants and receive and transmit payments of principal of, and interest on, the Notes to such Depositary Participants; and
 
 
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(iii)           whenever this Indenture requires or permits actions to be taken based upon instructions or directions of Holders of Notes evidencing a specified percentage of the voting rights of a particular series, the Depositary shall be deemed to represent such percentage only to the extent that it has received instructions to such effect from Noteholders and/or Depositary Participants owning or representing, respectively, such required percentage of the beneficial interest in the Notes (or Class of Notes) and has delivered such instruction to the Indenture Trustee.
 
(f)       Whenever a notice or other communication to the Noteholders is required under this Indenture, unless and until Definitive Notes have been issued to Noteholders, the Indenture Trustee shall give all such notices and communications to the Depositary.
 
(g)       The Indenture Trustee is hereby initially appointed as the Book-Entry Custodian and hereby agrees to act as such in accordance with the agreement that it has with the Depositary authorizing it to act as such.  The Book-Entry Custodian may, and, if it is no longer qualified to act as such, the Book-Entry Custodian shall, appoint, by written instrument delivered to the Issuer and the Depositary, any other transfer agent (including the Depositary or any successor Depositary) to act as Book-Entry Custodian under such conditions as the predecessor Book-Entry Custodian and the Depositary or any successor Depositary may prescribe, provided that the predecessor Book-Entry Custodian shall not be relieved of any of its duties or responsibilities by reason of any such appointment of other than the Depositary.  If the Indenture Trustee resigns or is removed in accordance with the terms hereof, the successor Indenture Trustee or, if it so elects, the Depositary shall immediately succeed to its predecessor’s duties as Book-Entry Custodian.  The Issuer shall have the right to inspect, and to obtain copies of, any Notes held as Book-Entry Notes by the Book-Entry Custodian.
 
(h)       The provisions of Section 205(h) shall apply to all transfers of Definitive Notes, if any, issued in respect of Ownership Interests in the Rule 144A Book-Entry Notes.
 
(i)        No transfer of any Note or interest therein shall be made unless that transfer is made pursuant to an effective registration statement under the Securities Act, and effective registration or qualification under applicable state securities laws, or is made in a transaction that does not require such registration or qualification.  If a transfer of any Definitive Note is to be made without registration under the Securities Act (other than in connection with the initial issuance thereof or a transfer thereof by the Depositary or one of its Affiliates), then the Note Registrar shall refuse to register such transfer unless it receives (and upon receipt, may conclusively rely upon) either:  (i) a certificate from such Noteholder substantially in the form attached as Exhibit B hereto or such other certification reasonably acceptable to the Indenture Trustee and a certificate from such Noteholder’s prospective transferee substantially in the form attached as Exhibit B hereto or such other certification reasonably acceptable to the Indenture Trustee; or (ii) an Opinion of Counsel satisfactory to the Indenture Trustee to the effect that such transfer may be made without registration under the Securities Act (which Opinion of Counsel shall not be an expense of the Issuer or any Affiliate thereof or of the Depositary, the Manager or Affiliate thereof, the Indenture Trustee or the Note Registrar in their respective capacities as such), together with the written certification(s) as to the facts surrounding such transfer from the Noteholder desiring to effect such transfer and/or such Noteholder’s prospective transferee on which such Opinion of Counsel is based.  If such a transfer of any interest in a Book-Entry Note is to be made without registration under the Securities Act, the transferor will be deemed to have made each of the representations and warranties set forth on Exhibit B hereto in respect of such interest as if it was evidenced by a Definitive Note and the transferee will be deemed to have made each of the representations and warranties set forth in Exhibit B hereto in respect of such interest as if it was evidenced by a Definitive Note.  None of the Depositary, the Issuer, the Indenture Trustee or the Note Registrar is obligated to register or qualify any Class of Notes under the Securities Act or any other securities law or to take any action not otherwise required under this Indenture to permit the transfer of any Note or interest therein without registration or qualification.  Any Noteholder desiring to effect such a transfer shall, and does hereby agree to, indemnify the Depositary, the Issuer, the Indenture Trustee and the Note Registrar against any liability that may result if the transfer is not so exempt or is not made in accordance with such federal and state laws.
 
 
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Section 203.                 Execution, Recourse Obligation .
 
The Notes shall be executed on behalf of the Issuer by an Authorized Signatory of the Issuer.  The Notes shall be dated the date of their authentication by the Indenture Trustee.
 
In case any Authorized Signatory of the Issuer whose signature shall appear on the Notes shall cease to be an Authorized Signatory of the Issuer before the authentication by the Indenture Trustee and delivery of such Notes, such signature or facsimile signature shall nevertheless be valid and sufficient for all purposes.
 
All Notes and the interest thereon shall be full recourse obligations of the Issuer and shall be secured by all of the Issuer’s right, title and interest in the Collateral.  The Notes shall never constitute obligations of the Indenture Trustee, the Manager, the Seller or of any shareholder or any Affiliate of the Seller (other than the Issuer) or any member or shareholder of the Issuer, or any officers, directors, employees or agents of any thereof, and no recourse may be had under or upon any obligation, covenant or agreement of this Indenture, any Supplement or of any Notes, or for any claim based thereon or otherwise in respect thereof, against any incorporator or against any past, present, or future owner, partner of an owner or any officer, employee or director thereof or of any successor entity, or any other Person, either directly or through the Issuer, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly agreed that this Indenture and the obligations issued hereunder are solely obligations of the Issuer, and that no such personal liability whatever shall attach to, or is or shall be incurred by, any other Person under or by reason of this Indenture, any Supplement or any Notes or implied therefrom, or for any claim based thereon or in respect thereof, all such liability and any and all such claims being hereby expressly waived and released as a condition of, and as a consideration for, the execution of this Indenture and the issue of such Notes.  Except as provided in any Supplement, no Person other than the Issuer shall be liable for any obligation of the Issuer under this Indenture or any Note or any losses incurred by any Noteholder.
 
 
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Section 204.                 Certificate of Authentication .
 
No Notes shall be secured hereby or entitled to the benefit hereof or shall be or become valid or obligatory for any purpose unless there shall be endorsed thereon a certificate of authentication by the Indenture Trustee, substantially in the form set forth in the form of Note attached to the related Supplement.  Such certificate on any Note issued by the Issuer shall be conclusive evidence and the only competent evidence that it has been duly authenticated and delivered hereunder.
 
At the written direction of the Issuer, the Indenture Trustee shall authenticate and deliver the Notes.  It shall not be necessary that the same Authorized Signatory of the Indenture Trustee execute the certificate of authentication on each of the Notes.
 
Section 205.                 Registration; Registration of Transfer and Exchange of Notes .
 
(a)       The Indenture Trustee shall keep at its Corporate Trust Office books for the registration and transfer of the Notes (the “Note Register”).  The Issuer hereby appoints the Indenture Trustee as its registrar (the “Note Registrar”) and transfer agent to keep such books and make such registrations and transfers as are hereinafter set forth in this Section 205 and also authorizes and directs the Indenture Trustee to provide a copy of such registration record to each of the Administrative Agent and the Manager upon their request.  The names and addresses of the Holders of all Notes and all transfers of, and the names and addresses of the transferee of, all Notes will be registered in such Note Register.  The Person in whose name any Note is registered shall be deemed and treated as the owner and Holder thereof for all purposes of this Indenture, and the Indenture Trustee and the Issuer shall not be affected by any notice or knowledge to the contrary.  If a Person other than the Indenture Trustee is appointed by the Issuer to maintain the Note Register, the Indenture Trustee shall have the right to inspect the Note Register at all reasonable times and to obtain copies thereof and the Indenture Trustee shall have the right to conclusively rely upon a certificate executed on behalf of the Note Registrar by an officer thereof as to the names and addresses of the Noteholders and the principal amounts and number of such Notes.  If a Person other than the Indenture Trustee is appointed by the Issuer to maintain the Note Register, the Issuer will give the Indenture Trustee and the Administrative Agent prompt written notice of such appointment and of the location, and any change in the location, of the successor note registrar. Notwithstanding the foregoing, for so long as Wells Fargo Bank, National Association is the Indenture Trustee, it shall also be the Note Registrar.
 
(b)       Payments of principal, premium, if any, and interest on any Note shall be payable on each Payment Date only to the registered Holder thereof on the Record Date immediately preceding such Payment Date.  The principal of, premium, if any, and interest on each Note shall be payable at the Corporate Trust Office in immediately available funds in such coin or currency of the United States of America as at the time for payment shall be legal tender for the payment of public and private debts.  Except as set forth in any Supplement, all interest payable on the Notes shall be computed on the basis of a 360-day year consisting of twelve months of 30 days each based on the actual number of days which have elapsed in the relevant calculation period.  Notwithstanding the foregoing or any provision in any Note to the contrary, if so requested by the registered Holder of any Note by written notice to the Indenture Trustee, all amounts payable to such registered Holder may be paid either (i) by crediting the amount to be distributed to such registered Holder to an account maintained by such registered Holder with the Indenture Trustee or by transferring such amount by wire to such other bank in the United States, including a Federal Reserve Bank, as shall have been specified in such notice, for credit to the account of such registered Holder maintained at such bank, or (ii) by mailing a check to such address as such Holder shall have specified in such notice, in either case without any presentment or surrender of such Note to the Indenture Trustee at the Corporate Trust Office.
 
 
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(c)       All payments on the Notes shall be paid to the Noteholders reflected in the Note Register as of the related Record Date by wire transfer of immediately available funds for receipt prior to 1:00 p.m. (New York City time) on the related Payment Date.  Any payments received by the Noteholders after 1:00 p.m. (New York City time) on any day shall be considered to have been received on the next succeeding Business Day; provided, however , that if the Issuer has deposited the required funds with the Indenture Trustee by 12:00 p.m. (New York City time), on such date, then the Issuer, upon receipt by the Noteholders of such payment, shall be deemed to have made such payment at the time so required.  Notwithstanding the foregoing or any provision in any Note to the contrary, if so requested by the registered Noteholder by written notice to the Indenture Trustee, all amounts payable to such registered Noteholder may be paid by mailing on the related Payment Date a check to such address as such Noteholder shall have specified in such notice, in either case without any presentment or surrender of such Note to the Indenture Trustee at the Corporate Trust Office.
 
(d)       Upon surrender for registration of transfer of any Note at the Corporate Trust Office, the Issuer shall execute and the Indenture Trustee, upon written request, shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Notes of the same class, of any authorized denominations and of a like aggregate original principal amount.
 
(e)       All Notes issued upon any registration of transfer or exchange of Notes shall be the legal, valid and binding obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under this Indenture and any Supplement, as the Notes surrendered upon such registration of transfer or exchange.
 
(f)       Every Note presented or surrendered for registration of transfer or for exchange shall (if so required by the Issuer or the Indenture Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Indenture Trustee duly executed, by the Holder thereof or his attorney duly authorized in writing.
 
(g)       Any service charge, fees or expenses made or expense incurred by the Indenture Trustee for any such registration, discharge from registration or exchange referred to in this Section 205 shall be paid by the Noteholder.  The Indenture Trustee or the Issuer may require payment by the Holder of a sum sufficient to cover any tax expense or other governmental charge payable in connection therewith.
 
(h)       If Notes are issued or exchanged in definitive form under Section 202, such Notes will not be registered by the Indenture Trustee unless each prospective initial Noteholder acquiring a Note, each prospective transferee acquiring a Note and each prospective owner (or transferee thereof) of a beneficial interest in Notes (each, a “Prospective Owner”) acquiring such beneficial interest provides the Manager, the Issuer, the Indenture Trustee and any successor Manager with a written representation that the statement in either subsection (1) or (2) of Section 208 is an accurate representation as to all sources of funds to be used to pay the purchase price of the Notes.
 
 
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(i)   No transfer of a Note shall be deemed effective unless (x) the transfer of such Note is not to a Competitor and (y) the registration and prospectus delivery requirements of Section 5 of the Securities Act and any applicable state securities laws are complied with, or such transfer is exempt from the registration and prospectus delivery requirements under said Securities Act and laws.  In the event that a transfer is to be made without registration or qualification, such Noteholder’s prospective transferee shall deliver to the Indenture Trustee an investment letter substantially in the form of Exhibit B hereto (the “Purchaser Letter”).  Neither the Indenture Trustee nor the Issuer is under any obligation to register the Notes under the Securities Act or any other securities law or to bear any expense with respect to such registration by any other Person or monitor compliance of any transfer with the securities laws of the United States regulations promulgated in connection thereto or ERISA.
 
Section 206.                 Mutilated, Destroyed, Lost and Stolen Notes .
 
(a)       If (i) any mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, and (ii) there is delivered to the Indenture Trustee such security or indemnity as it and the Issuer may require to hold the Issuer, the Manager and the Indenture Trustee harmless, then the Issuer shall execute and the Indenture Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note of the same Series and Class and maturity and of like terms as the mutilated, destroyed, lost or stolen Note; provided , however , that if any such destroyed, lost or stolen Note, but not a mutilated Note, shall have become, or within seven days shall be due and payable, the Issuer may pay such destroyed, lost or stolen Note when so due or payable instead of issuing a replacement Note.
 
(b)       If, after the delivery of such replacement Note, or payment of a destroyed, lost or stolen Note pursuant to the proviso to the preceding sentence, a bona fide purchaser of the original Note in lieu of which such replacement Note was issued presents for payment such original Note, the Issuer and the Indenture Trustee shall be entitled to recover upon the security or indemnity provided therefor to the extent of any and all loss, damage, cost or expense incurred by the Issuer or the Indenture Trustee in connection therewith.
 
(c)       The Indenture Trustee and the Issuer may, for each new Note authenticated and delivered under the provisions of this Section 206, require the advance payment by the Noteholder of the expenses, including counsel fees, service charges and any tax or governmental charge which may be incurred by the Indenture Trustee or the Issuer.  Any Note issued under the provisions of this Section 206 in lieu of any Note alleged to be destroyed, mutilated, lost or stolen, shall be equally and proportionately entitled to the benefits of this Indenture with all other Notes of the same Series and Class.  The provisions of this Section 206 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes.
 
 
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Section 207.                 Delivery, Retention and Cancellation of Notes .
 
Each Noteholder is required, and hereby agrees, to surrender to the Indenture Trustee, prior to the final Payment Date, any Note on which the final payment due thereon has been made.  Any such Note as to which the Indenture Trustee has made or holds the final payment thereon shall be deemed canceled and shall no longer be Outstanding for any purpose of this Indenture, whether or not such Note is ever returned to the Indenture Trustee.  Matured Notes delivered upon final payment to the Indenture Trustee and any Notes transferred or exchanged for other Notes shall be canceled and disposed of by the Indenture Trustee in accordance with its policy of disposal and the Indenture Trustee shall promptly deliver to the Issuer such canceled Notes upon reasonable prior written request.  If the Indenture Trustee shall acquire, for its own account, any of the Notes, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Notes.  If the Issuer shall acquire any of the Notes, such acquisition shall operate as a redemption or satisfaction of the indebtedness represented by such Notes.  Notes which have been canceled by the Indenture Trustee shall be deemed paid and discharged for all purposes under this Indenture.
 
Section 208.                 ERISA Deemed Representations .
 
Each Noteholder acquiring Notes and each Prospective Owner will be deemed to have represented by such purchase to the Issuer, the Indenture Trustee and the Manager that either (1) it is not acquiring the Notes with the assets of a Plan; or (2) the acquisition and holding of the Notes will not give rise to a nonexempt prohibited transaction under Section 406(a) of ERISA or Section 4975 of the Code.
 
 
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ARTICLE III
 
PAYMENT OF NOTES; STATEMENTS TO NOTEHOLDERS
 
Section 301.                 Principal and Interest .
 
Distributions of principal, premium, if any, and interest on any Series or Class of Notes shall be made to Noteholders of each Series and Class as set forth in Section 302 of this Indenture and the related Supplement.  Except as set forth in any Supplement, the maximum Overdue Rate for any Note under any Series shall be equal to the sum of (i) two percent (2.00%) per annum, plus (ii) the interest rate for such Note prior to the occurrence of the relevant Event of Default.  Except as set forth in any Supplement, all interest and fees payable on, or with respect to, the Notes shall be computed on the basis of a 360-day year of twelve 30-day months for the actual number of days which have elapsed in the relevant calculation period.
 
Section 302.                 Trust Account .
 
(a)       On or prior to the Closing Date, the Indenture Trustee shall establish and maintain the Trust Account into which the following amounts shall be deposited:  (i) all Collections, (ii) Warranty Purchase Amounts and (iii) other payments required by this Indenture and other Related Documents to be deposited therein.  Such Trust Account shall initially be established and maintained with the Corporate Trust Office in trust for the Indenture Trustee, on behalf of the Noteholders and each Interest Rate Hedge Provider, and shall be maintained until the Aggregate Outstanding Obligations are paid in full.  The Trust Account shall at all times be an Eligible Account and shall be pledged to the Indenture Trustee pursuant to the terms of this Indenture.  The Issuer shall not establish any additional Trust Accounts without prior written notice to the Indenture Trustee and without the prior written consent of the Requisite Global Majority.
 
(b)       The Issuer shall direct the Manager to deposit funds into the Trust Account at the times and in the amounts required pursuant to the terms of the Management Agreement and the Intercreditor Agreement.  So long as no Manager Default shall have occurred and then be continuing, the Manager shall be permitted to request the Indenture Trustee to withdraw from amounts on deposit in the Trust Account, or otherwise net out, from amounts otherwise required to be deposited into the Trust Account pursuant to Section 302(a) the amount of any Management Fees or Management Fee Arrearage that would otherwise be due and payable on the immediately succeeding Payment Date.
 
(c)       On each Determination Date, the Manager, shall prepare and deliver to the Issuer, the Indenture Trustee and the Administrative Agent, the Manager Report.  On each Payment Date, the Indenture Trustee, based on the Manager Report ( provided that, in the absence of any Manager Report, the Indenture Trustee shall distribute all funds available for distribution in accordance with written instructions from the Administrative Agent and shall hold until delivery of such Manager Report or such written instructions from the Administrative Agent (i) any funds otherwise payable to the Issuer and (ii) any other amounts which the Administrative Agent is unable to ascertain or allocate to a specific payment priority set forth in this Indenture), shall distribute funds in an amount equal to the Available Distribution Amount to the following Persons in the following order of priority:
 
 
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(I)            On each Payment Date, if neither an Early Amortization Event nor an Event of Default shall have occurred and then be continuing:
 
(1)        To the Indenture Trustee by wire transfer of immediately available funds (A) all Indenture Trustee Fees (including any out of pocket expenses of the Indenture Trustee) then due and payable for all Series then Outstanding and (B) any Indenture Trustee Indemnified Amounts (the sum of (A) and (B) not to exceed $40,000 annually, with respect to each Series of Notes then Outstanding);
 
(2)        To the Manager Transfer Facilitator, the amount of any Manager Transfer Facilitator Fee (including any reimbursements and indemnification amounts (not to exceed annually the sum of $40,000 less any amounts paid in clause (1) above)) payable to the Manager Transfer Facilitator pursuant to the Manager Transfer Facilitator Agreement;
 
(3)        To the Independent Management Provider by wire transfer of immediately available funds (not to exceed $25,000 annually), all Independent Management Provider Fees then due and payable for all Series then Outstanding;
 
(4)        To the Manager, any unpaid Management Fees and any Management Fee Arrearages and any unreimbursed Manager Advances, to the extent not withheld by the Manager in accordance with the terms of the Management Agreement;
 
(5)        To the Issuer to pay Issuer Expenses (in an aggregate amount not to exceed $50,000 annually) to the extent such payments would not result in the occurrence of an Early Amortization Event or an Event of Default;
 
(6)        To the Administrative Agent, the amount of Administrative Agent Fees (and any arrearages thereof) then due and payable;
 
(7)        To each Interest Rate Hedge Provider on a pro rata basis (based on amounts then due and payable under all Interest Rate Hedge Agreements), all scheduled payments and interest thereon (but excluding termination payments thereunder) then due and payable under the related Interest Rate Hedge Agreement and the amount of any arrearages thereof;
 
(8)        In payment of the following amounts on a pro rata basis: to each Series Account for each Series of Notes then Outstanding, an amount equal to the Interest Payments then due and payable for such Series;
 
(9)        To the Restricted Cash Account, the amount (if any) necessary to restore amounts on deposit therein to the Restricted Cash Amount for such Payment Date;
 
 
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(10)      To the Series Account for each Series of Notes then Outstanding and subject to the provisions of Section 302(d), an amount equal to the Minimum Principal Payment Amounts then due and payable for such Series;
 
(11)      Each of the following on a pro rata and pari passu basis (based on amounts then due), (i) to the Series Account for each Series of Notes then Outstanding and subject to the provisions of Section 302(d), an amount equal to the Scheduled Principal Payment Amounts then due and payable for such Series and (ii) to each Interest Rate Hedge Provider on a pro rata basis (based on amounts then due and payable under all Interest Rate Hedge Agreements), all remaining amounts then due and payable under the related Interest Rate Hedge Agreement (after giving effect to clause (7) above);
 
(12)      To the Series Account for each Series of Notes in accordance with the provisions of Section 302(e) hereof, an amount equal to the Supplemental Principal Payment Amount then due and payable;
 
(13)      To each Series Account for each Series of Notes then Outstanding on a pro rata basis (based on respective amounts then due), an amount equal to all other amounts then due and payable to the Noteholders of such Series, including, without limitation, increased costs, taxes, indemnity payments and other amounts (including additional principal payment amounts) identified in the related Supplement;
 
(14)      To the Independent Management Provider, any remaining unpaid amounts due and payable;
 
(15)      To the Indenture Trustee, the amount of any unpaid Indenture Trustee Fees, expenses and Indenture Trustee Indemnified Amounts to the extent not paid pursuant to clause (1) above;
 
(16)      To the Manager Transfer Facilitator, the amount of any unpaid Manager Transfer Facilitator Fee (including any reimbursements and indemnification amounts) payable to the Manager Transfer Facilitator pursuant to the Manager Transfer Facilitator Agreement to the extent not paid pursuant to clause (2) above;
 
(17)      To the officers and directors of the Issuer, the amount of any unpaid indemnification payments then due and payable to them by the Issuer;
 
(18)      To the Manager in the amount of any unpaid indemnification payments payable to the Manager pursuant to the Management Agreement; and
 
(19)      To the Issuer (or its designee), any remaining Available Distribution Amount.
 
(II)           On each Payment Date, if an Early Amortization Event shall have occurred and then be continuing with respect to any Series then Outstanding, but no Event of Default has occurred and is continuing:
 
 
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(1)        To the Indenture Trustee by wire transfer of immediately available funds, (A) all Indenture Trustee Fees (including any out of pocket expenses of the Indenture Trustee) then due and payable for all Series then Outstanding and (B) all Indenture Trustee Indemnified Amounts (the sum of (A) and (B) not to exceed $40,000 annually, with respect to each Series of Notes then Outstanding);
 
(2)        To the Manager Transfer Facilitator, the amount of any Manager Transfer Facilitator Fee (including any reimbursements and indemnification amounts (not to exceed annually the sum of $40,000 less any amounts paid in clause (1) above)) payable to the Manager Transfer Facilitator pursuant to the Manager Transfer Facilitator Agreement;
 
(3)        To the Independent Management Provider by wire transfer of immediately available funds (not to exceed $25,000 annually), all Independent Management Provider Fees then due and payable for all Series then Outstanding;
 
(4)        To the Manager, any unpaid Management Fees and any Management Fee Arrearages and any unreimbursed Manager Advances, to the extent not withheld by the Manager in accordance with the terms of the Management Agreement;
 
(5)        To the Issuer, to pay Issuer Expenses (in an aggregate amount not to exceed $50,000 annually) to the extent such payments would not result in the occurrence of an Event of Default;
 
(6)        To the Administrative Agent, the amount of Administrative Agent Fees (and any arrearages thereof) then due and payable;
 
(7)        To each Interest Rate Hedge Provider on a pro rata basis (based on amounts then due and payable under all Interest Rate Hedge Agreements), all scheduled payments and interest thereon (but excluding termination payments thereunder) then due and payable under the related Interest Rate Hedge Agreement and the amount of any arrearages thereof;
 
(8)        In payment of the following amounts on a pro rata basis: to each Series Account for each Series of Notes then Outstanding on a pro rata basis (based on respective amounts then due), an amount equal to the Interest Payments then due and payable for such Series;
 
(9)        To the Restricted Cash Account, the amount (if any) necessary to restore amounts on deposit therein to the Restricted Cash Amount for such Payment Date;
 
(10)      To the Series Account for each Series of Notes then Outstanding and subject to the provisions of Section 302(d) hereof, an amount equal to the Minimum Principal Payment Amounts then due and payable for such Series;
 
(11)      Each of the following on a pro rata and a pari passu basis (based on amounts then due), all remaining Available Distribution Amount, (1) to the Series Account for each Series of Notes then Outstanding and subject to the provisions of Section 302(d) hereof, an amount equal to the Scheduled Principal Payment Amounts then due and payable for such Series and (2) to each Interest Rate Hedge Provider, the remaining amounts then due and payable under the related Interest Rate Hedge Agreement (after giving effect to clause (7) above), until such amounts are paid in full;
 
 
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(12)      To each Series Account for each Series of Notes then Outstanding (other than the Series Account for any Series of Warehouse Notes for which a Conversion Event has not occurred) on a pro rata basis (based on the unpaid principal balance then Outstanding), until the principal balance of all Notes then Outstanding are paid in full;
 
(13)      To each Series Account for each Series of Notes then Outstanding on a pro rata basis (based on respective amounts then due), an amount equal to all other amounts then due and payable to the Noteholders of such Series, including, without limitation, Default Interest, increased costs, taxes and indemnity payments identified in the related Supplement;
 
(14)      To the Independent Management Provider, any remaining unpaid amounts due and payable;
 
(15)      To the Indenture Trustee, the amount of any unpaid Indenture Trustee Fees, expenses and Indenture Trustee Indemnified Amounts to the extent not paid pursuant to clause (1) above;
 
(16)      To the Manager Transfer Facilitator, the amount of any unpaid Manager Transfer Facilitator Fee (including any reimbursements and indemnification amounts) payable to the Manager Transfer Facilitator pursuant to the Manager Transfer Facilitator Agreement to the extent not paid pursuant to clause (2) above;
 
(17)      To the officers and directors of the Issuer, the amount of any unpaid indemnification payments then due and payable to them by the Issuer;
 
(18)      To the Manager in the amount of any unpaid indemnification payments payable to the Manager pursuant to the Management Agreement; and
 
(19)      To the Issuer (or its designee), any remaining Available Distribution Amount.
 
(III)          On each Payment Date, if an Event of Default shall have occurred and then be continuing with respect to any Series then Outstanding, the Indenture Trustee will make the following payments from the Available Distribution Amount then on deposit in the Trust Account to the following Persons in the following order of priority:
 
(1)        To the Indenture Trustee by wire transfer of immediately available funds (A) all Indenture Trustee Fees (including any out of pocket expenses of the Indenture Trustee) then due and payable for all Series then Outstanding and (B) all Indenture Trustee Indemnified Amounts (the sum of (A) and (B) not to exceed $75,000 annually, with respect to each Series of Notes then Outstanding);
 
 
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(2)        To the Manager Transfer Facilitator, the amount of any Manager Transfer Facilitator Fee (including any reimbursements and indemnification amounts (not to exceed annually the sum of $75,000 less any amounts paid in clause (1) above)) payable to the Manager Transfer Facilitator pursuant to the Manager Transfer Facilitator Agreement;
 
(3)        To the Independent Management Provider by wire transfer of immediately available funds (not to exceed $25,000 annually), all Independent Management Provider Fees then due;
 
(4)        To the Manager, any unpaid Management Fees and any Management Fee Arrearages to the extent not withheld by the Manager in accordance with the terms of the Management Agreement;
 
(5)        To the Issuer, to pay Issuer Expenses (in an aggregate amount not to exceed $250,000 annually);
 
(6)        To the Administrative Agent, the amount of Administrative Agent Fees (and any arrearages thereof) then due and payable;
 
(7)        To each Interest Rate Hedge Provider on a pro rata basis (based on amounts then due and payable under all Interest Rate Hedge Agreements), all scheduled payments and interest thereon (but excluding termination payments thereunder) then due and payable under the related Interest Rate Hedge Agreement and the amount of any arrearages thereof;
 
(8)        In payment of the following amounts on a pro rata basis: to each Series Account for each Series of Notes then Outstanding, an amount equal to the Interest Payments then due and payable for such Series;
 
(9)        One of the following: (A) if the Notes of any Series then Outstanding have been accelerated, each of the following on a pro rata and a pari passu basis (based on amounts then due), all remaining Available Distribution Amount, (1) to each Series Account, the then unpaid principal balance of the related Notes ( pro rata based on the amounts unpaid on the date on which such Event of Default first occurs) and (2) to each Interest Rate Hedge Provider, the remaining amounts then due and payable under the related Interest Rate Hedge Agreement, until such amounts are paid in full; or (B) if none of the Notes of any Series then Outstanding has been accelerated, each of the following on a pro rata and a pari passu basis (based on amounts then due), all remaining Available Distribution Amount, (1) to the Series Account for each Series of Notes then Outstanding ( pro rata based on the amounts unpaid on the date on which such Event of Default occurs) the then unpaid principal balances of all Notes then Outstanding are paid in full  and (2) to each Interest Rate Hedge Provider on a pro rata basis (based on amounts then due and payable under all Interest Rate Hedge Agreements), all remaining amounts then due and payable under the related Interest Rate Hedge Agreement (after giving effect to clause (7) above);
 
 
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(10)      To each Series Account for each Series of Notes then Outstanding on a pro rata basis (based on respective amounts then due), an amount equal to all other amounts then due and payable to the Noteholders of such Series, including, without limitation, Default Interest, increased costs, taxes and indemnity payments identified in the related Supplement;
 
(11)      To the Indenture Trustee, the amount of any unpaid Indenture Trustee Fees, expenses and Indenture Trustee Indemnified Amounts to the extent not paid pursuant to clause (1) above;
 
(12)      To the Manager Transfer Facilitator, the amount of any unpaid Manager Transfer Facilitator Fee (including any reimbursements and indemnification amounts) payable to the Manager Transfer Facilitator pursuant to the Manager Transfer Facilitator Agreement) to the extent not paid pursuant to clause (2) above;
 
(13)      To the officers and directors of the Issuer, the amount of any unpaid indemnification payments then due and payable to them by the Issuer;
 
(14)      To the Manager in the amount of any unreimbursed Manager Advances and unpaid indemnification payments payable to the Manager pursuant to the Management Agreement; and
 
(15)      To the Issuer (or its designee), any remaining Available Distribution Amount.
 
(d)       If on any Payment Date on which no Event of Default is then continuing there are not sufficient funds to pay, in full, the Minimum Principal Payment Amounts and/or Scheduled Principal Payment Amounts owing to all Series of Notes then Outstanding, as the case may be, then principal payments having the same payment priority will be paid, in full, to the Series first issued (based on their respective dates of issuance or Conversion Dates, as applicable) in chronological order based on their respective dates of issuance or Conversion Dates, as applicable.  For purposes of this Section 302(d) only, any Series designated as a Warehouse Note will be deemed to have an issuance date equivalent to its Conversion Date.  If two or more Series of the Notes were issued on the same date or have the same Conversion Date, then principal payments having the same payment priority will be allocated among each such Series, on a pro rata basis, based on the principal payments then due.
 
(e)       On each Payment Date, any Supplemental Principal Payment Amount then due and owing, shall be applied first to each Series of Warehouse Notes then Outstanding on a pro rata basis, in proportion to the then unpaid principal balance of such Warehouse Notes, until the principal balances of all Warehouse Notes have been paid in full, and then to all Series of Term Notes then Outstanding on a pro rata basis, in proportion to the then unpaid principal balance of each such Series of Term Notes.  Notwithstanding the foregoing, if sufficient funds are not available to allow the Issuer to prepay the principal balance of the Warehouse Notes on such Payment Date in an amount equal to the Asset Base Deficiency, then the amount of any Supplemental Principal Payment Amount to be actually paid on such Payment Date shall be allocated among all Series of Notes then Outstanding (including the Term Notes) on a pro rata basis, in proportion to the then unpaid principal balance of such Notes.
 
 
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(f)       If any Series has more than one Class of Notes then Outstanding, then the Available Distribution Amount shall be calculated without regard to the payment priorities of the Classes of Notes within such Series.  Once the Available Distribution Amount has been allocated to each Series, then that portion of the Available Distribution Amount allocable to such Series shall be paid to each Class of Noteholders of such Series in accordance with the priority of payments set forth in the related Supplement.
 
Section 303.                 Investment of Monies Held in the Trust Account, the Restricted Cash Account and Series Accounts .
 
(a)       Subject to the provisions of Section 703 hereof, the Indenture Trustee shall invest any cash deposited in the Trust Account, the Restricted Cash Account, each Pre-Funding Account, and each Series Account in such Eligible Investments as the Issuer or its designee (or its authorized agent) shall direct in writing or by telephone, subsequently confirmed in writing.  Each Eligible Investment (including reinvestment of the income and proceeds of Eligible Investments) shall be held to its maturity and shall mature or shall be payable on demand not later than the Determination Date immediately preceding the next succeeding Payment Date.  If the Indenture Trustee has not received written instructions from the Issuer or its designee by 2:30 p.m. (New York time) on the day such funds are received as to the investment of funds then on deposit in any of the aforementioned accounts, the Issuer hereby instructs the Indenture Trustee to invest such funds in overnight investments of the type described in clause (iv) of the definition of Eligible Investments.  Eligible Investments shall be made in the name of the Indenture Trustee for the benefit of the Noteholders and each Interest Rate Hedge Provider.  Any earnings on Eligible Investments in the Trust Account, the Restricted Cash Account, each Pre-Funding Account, and each Series Account shall be retained in each such account and be distributed in accordance with the terms of this Indenture or any related Supplement.  The Indenture Trustee shall not be liable or responsible for losses on any investments made by it pursuant to this Section 303.
 
(b)       On or prior to the Closing Date, each of the Issuer and the Securities Intermediary shall enter into Control Agreements each in the form of Exhibit F hereto for each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, and any Series Accounts.  At all times on and after the Closing Date, each such account shall be the subject of a Control Agreement.
 
(c)       The Indenture Trustee, acting in accordance with the terms of this Indenture, shall be entitled to deliver an Entitlement Order to the Securities Intermediary at which such accounts are maintained; provided , however , that the Indenture Trustee agrees not to invoke its right to provide an Entitlement Order unless an Event of Default has occurred and is continuing.  The Control Agreements shall provide that upon receipt of the Entitlement Order in accordance with the provisions of this Indenture, the Indenture Trustee shall comply with such Entitlement Order without further consent by the Issuer or any other Person.
 
 
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(d)       Each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, and the Series Accounts shall be initially established with the Indenture Trustee and, so long as any Outstanding Obligation remains unpaid, shall be maintained with the Indenture Trustee so long as (A) the short-term unsecured debt obligations of the financial institution fulfilling the role of the Indenture Trustee are rated not less than the Required Deposit Rating or (B) each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, and the Series Accounts are maintained at the Corporate Trust Office.  If any of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, or the Series Accounts are not maintained at the Corporate Trust Office or if the short-term unsecured debt obligations of the Indenture Trustee fall below the Required Deposit Rating, then the Issuer shall within ten (10) days after obtaining knowledge of such condition, with the Indenture Trustee’s assistance as necessary, cause each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, and the Series Accounts to be transferred to either (A) an Eligible Institution which then maintains the Required Deposit Rating and is otherwise acceptable to the Administrative Agent, or (B) with the prior written consent of the Administrative Agent, the Corporate Trust Office of the successor Indenture Trustee.  Prior to any of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, or any Series Accounts being maintained with a Person other than the Indenture Trustee, the Issuer shall obtain the prior written consent of the Administrative Agent and shall cause a new Control Agreement to be entered into with such Person as securities intermediary.
 
(e)       Each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, and the Series Accounts shall be maintained in a state within the United States of America and shall be governed by the laws of the State of New York, regardless of any provision in any other agreement.  Each Control Agreement shall provide for purposes of the UCC that New York shall be deemed to be the Securities Intermediary’s jurisdiction and each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, and each Series Account (as well as the Securities Entitlements related thereto) shall be governed by the laws of the State of New York.
 
(f)       The Indenture Trustee, in its capacity as the Securities Intermediary, has not entered into, and until the termination of this Indenture will not enter into, any agreement with any other Person relating to any of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, any Series Account or any Financial Assets credited thereto pursuant to which it has agreed to comply with Entitlement Orders of such other Person and the Securities Intermediary has not entered into, and until the termination of this Agreement will not enter into, any agreement with the Issuer, the Seller, the Manager or the Indenture Trustee purporting to limit or condition the obligation of the Securities Intermediary to comply with Entitlement Orders as set forth in Section 303(c) hereof.
 
(g)     Except for the claims and interest of the Indenture Trustee and of the Issuer hereunder in each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account and each Series Account, to the best of its knowledge without independent investigation, the Indenture Trustee, in its capacity as the initial Securities Intermediary, knows of no claim to, or interest in, any of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, any Series Account or in any Financial Asset credited thereto.  If any other Person asserts any Lien, encumbrance or adverse claim (including any writ, garnishment, judgment, warrant of attachment, execution or similar process) against any of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, any Series Account or in any Financial Asset credited thereto, the Securities Intermediary will promptly notify the Indenture Trustee, the Manager, the Administrative Agent, each Interest Rate Hedge Provider and the Issuer thereof.
 
 
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(h)       The Indenture Trustee shall possess a perfected security interest in all right, title and interest in and to all funds on deposit from time to time in each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account, each Series Account and in all Proceeds thereof.  Each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account and each Series Account shall be in the name of and under the sole dominion and control of the Indenture Trustee for the benefit of the Noteholders and each Interest Rate Hedge Provider.  The Indenture Trustee shall make withdrawals and payments from each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account and each Series Account and apply such amounts in accordance with the provisions of the Indenture and the related Manager Report or, in the absence of any Manager Report, in accordance with written instructions from the Administrative Agent.
 
(i)     The Issuer shall not direct the Indenture Trustee to make any investment of any funds or to sell any investment held in any of the Trust Account, the Restricted Cash Account, each Pre-Funding Account and any Series Account unless the security interest of the Indenture Trustee in such account and any funds or investments held therein shall continue to be perfected without any further action by any Person.
 
(j)     The Financial Assets and other items deposited to the accounts will not be subject to deduction, set-off, banker’s lien, or any other right in favor of any Person except as created pursuant to this Indenture.  For the avoidance of doubt, the fees and expenses of the Indenture Trustee shall be payable solely pursuant to Section 302, 403 or Section 806 of this Indenture and shall not be subject to deduction, set-off, bankers lien or other right of the Indenture Trustee.
 
Section 304.                 Reports to Noteholders .
 
The Indenture Trustee shall promptly upon the receipt thereof, make available to each Noteholder, each Interest Rate Counterparty, the Manager Transfer Facilitator and each Rating Agency, a copy of each Manager Report, each Asset Base Certificate, the financial statements delivered pursuant to Section 626 and 629 hereof and each Accountants’ Report set forth in Section 8.9 of the Management Agreement and the related AUP letter, by posting copies thereof on its password-protected website (www.CTSLink.com) or at such other address as shall be specified by the Indenture Trustee from time to time in writing to each Noteholder, each Interest Rate Counterparty, the Manager Transfer Facilitator and each Rating Agency; provided, however, the Indenture Trustee shall have no obligation to provide such information described in this Section 304 until it has received the requisite information from the applicable party.  The Indenture Trustee will make no representation or warranties as to the accuracy or completeness of such documents and will assume no responsibility therefor.  In connection with providing access to the Indenture Trustee’s website, the Indenture Trustee may require registration and the acceptance of a disclaimer.  The Indenture Trustee shall not be liable for the dissemination of information in accordance with the terms of this Indenture.
 
 
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Section 305.                 Records .
 
The Indenture Trustee shall cause to be kept and maintained adequate records pertaining to the Trust Account, each Restricted Cash Account, each Pre-Funding Account and each Series Account and all receipts and disbursements therefrom.  The Indenture Trustee shall deliver at least monthly   an accounting thereof in the form of a trust statement to the Issuer, or make available on its website at www.CTSLink.com (or at such other address as the Indenture Trustee shall notify the parties hereto from time to time), the Manager, the Administrative Agent and each Interest Rate Hedge Provider.
 
Section 306.                 Restricted Cash Account .
 
(a)     The Indenture Trustee shall establish and maintain in the name of the Indenture Trustee an Eligible Account in the name of the Indenture Trustee with the Corporate Trust Office which shall be designated the restricted cash account (the “ Restricted Cash Account ”) for all Series and which shall be held by the Indenture Trustee pursuant to this Indenture and the related Supplements.  Any and all moneys remitted by the Issuer, or Manager on its behalf, to the Restricted Cash Account from the Trust Account, together with any Eligible Investments in which such moneys are or will be invested or reinvested, shall be held in the Restricted Cash Account for all Series.  On the issuance date of any Series, the Issuer will deposit, or cause to be deposited, into the Restricted Cash Account sufficient amount of funds such that, after giving effect to such deposit, the amount of funds on deposit therein shall be equal to the Restricted Cash Amount, and thereafter amounts shall be deposited in the Restricted Cash Account in accordance with Section 302.  Any and all moneys remitted by the Indenture Trustee to the Restricted Cash Account shall be invested in Eligible Investments in accordance with this Indenture and shall be distributed in accordance with this Section 306.
 
(b)       On each Determination Date, the Indenture Trustee shall, in accordance with the terms of each applicable Supplement and the Manager Report or, in the absence of a Manager Report, pursuant to written instructions from the Administrative Agent, withdraw from the Restricted Cash Account and deposit into the Series Account for each affected Series an amount equal to the Permitted Payment Date Withdrawals for such Series.  Amounts transferred to a Series Account pursuant to the provisions of this Section 306(b) may only be used to pay amounts specified in the definition of “Permitted Payment Date Withdrawals”.  Any other conditions or restrictions related to such draw for a specific Series shall be set forth in the related Supplement.
 
(c)     On each Payment Date, the Indenture Trustee shall, in accordance with the Manager Report or, in the absence of a Manager Report, pursuant to written instructions from the Administrative Agent, deposit in the Trust Account for distribution in accordance with Section 302 of this Indenture the excess, if any, of (A) amounts then on deposit in the Restricted Cash Account (after giving effect to any withdrawals therefrom on such Payment Date) over (B) the Restricted Cash Amount.  On the Legal Final Maturity Date for the Series with the latest Legal Final Maturity Date, any remaining funds in the Restricted Cash Account shall be deposited in the Trust Account and, subject to the limitations set forth in any Supplement, distributed in accordance with Section 302 of this Indenture and the related Supplements.
 
 
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(d)     If the amount on deposit in the Restricted Cash Account on a Determination Date is not sufficient to pay in full the aggregate Permitted Payment Date Withdrawals referred to in Section 306(b) above, then the amount of funds then available in the Restricted Cash Account will be allocated among the various Series on a pro rata basis in proportion to the amount of their respective Permitted   Payment Date Withdrawals.
 
(e)     In addition to the withdrawals set forth in Section 306(b) above, on any date on which an Event of Default has occurred and is continuing and the Notes have been accelerated in accordance with the terms of this Indenture, the Indenture Trustee, acting at the direction of the Requisite Global Majority, shall withdraw all amounts on deposit in the Restricted Cash Account and use such amounts to pay the sum of interest and arrearages then payable on the Notes plus the Aggregate Principal Balance in accordance with the priorities set forth in Section 806 hereof.
 
Section 307.                 Pre-Funding Account .
 
Pursuant to the terms of a Supplement, the Indenture Trustee may establish and maintain, in its name, a Pre-Funding Account at its Corporate Trust Office for the benefit of the Noteholders of all Series, each Interest Rate Hedge Provider and each Series Enhancer. The Issuer may deposit in such account a portion of the proceeds from the issuance of a Series of Notes solely to be used to acquire additional Containers from the Seller during a specified period of time following the issuance of such Series of Notes.
 
Section 308.                 CUSIP Numbers .
 
The Issuer in issuing the Notes may use “CUSIP” numbers (if then generally in use), and, if so, the Indenture Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption shall not be affected by any defect in or omission of such numbers.  The Issuer will promptly notify the Indenture Trustee of any change in the “CUSIP” numbers.
 
Section 309.                 No Claim .
 
Indemnity payments payable to the Seller, the Indenture Trustee and Manager shall be non-recourse to the Issuer and shall not constitute a claim against the Issuer or the Collateral in the event such amounts are not paid in accordance with Section 302 or 806 of this Indenture.
 
Section 310.                Compliance with Withholding Requirements .
 
Notwithstanding any other provision of this Indenture, the Indenture Trustee shall comply with all United States federal income tax withholding requirements with respect to payments to Noteholders of interest, original issue discount, or other amounts that the Indenture Trustee reasonably believes are applicable under the Code.  The consent of Noteholders shall not be required for any such withholding.
 
 
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Section 311.                  Tax Treatment of Notes .
 
The Issuer has entered into this Indenture, and the Notes will be issued, with the intention that, for United States federal, state and local income, single business and franchise tax purposes, the Notes will qualify as indebtedness.  The Issuer and the Indenture Trustee, by entering into this Indenture, and each Noteholder, by its acceptance of its Note, agree to treat the Notes for United States federal, state and local income, single business and franchise tax purposes as indebtedness.
 
Section 312.                 Subordination .
 
Wells Fargo Bank, National Association, in its capacity as the Securities Intermediary hereby irrevocably subordinates to the security interest of the Indenture Trustee under this Indenture any and all security interest in, liens on and rights of setoff against any and all of the Collateral that the Securities Intermediary may have or acquire on the date hereof or at any time hereafter until all Outstanding Obligations, and all amounts payable by the Issuer under this Indenture and all other Related Documents have been paid in full and all covenants and agreements of the Issuer in this Indenture and all other Related Documents have been fully performed.
 
ARTICLE IV
 
COLLATERAL
 
Section 401.                 Collateral .
 
(a)     The Notes and the obligations of the Issuer hereunder shall be obligations of the Issuer as provided in Section 203 hereof.  The Noteholders and each Interest Rate Hedge Provider shall also have the benefit of, and the Notes shall be secured by and be payable from, the Issuer’s right, title and interest in the Collateral.  The income, payments and Proceeds of such Collateral shall be allocated to each such Series of Notes strictly in accordance with the applicable payment priorities set forth in Section 302 and Section 806 hereof.  Notwithstanding anything contained in this Indenture to the contrary, the Indenture Trustee or any Secured Party may reject or refuse to accept any Collateral for credit toward payment of the Notes that is an account, instrument, chattel paper, lease, or other obligation or property of any kind due from, owed by, or belonging to, a Prohibited Person.
 
(b)     Notwithstanding anything contained in this Indenture to the contrary, the Issuer expressly agrees that it shall remain liable under each of its Contracts and Leases to observe and perform all the conditions and obligations to be observed and performed by it thereunder and that it shall perform all of its duties and obligations thereunder, all in accordance with and pursuant to the terms and provisions of each such Contract or Lease, as the case may be.
 
 
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(c)       The Indenture Trustee hereby acknowledges the appointment by the Issuer of the Manager to service and administer the Collateral in accordance with the provisions of the Management Agreement and, so long as such Management Agreement shall not have been terminated in accordance with its terms, the Indenture Trustee hereby agrees to provide the Manager with such documentation and to take all such actions with respect to the Collateral as the Manager may reasonably request in writing in accordance with the express provisions of the Management Agreement; provided, however , that the Indenture Trustee shall be entitled to receive from the Issuer reasonable compensation and cost reimbursement for any such action.  Until such time as the Management Agreement has been terminated in accordance with its terms, the Manager, on behalf of the Issuer, shall continue to collect all Accounts and payments on the Leases in accordance with the provisions of the Management Agreement and make such deposits as are required pursuant to the terms of the Intercreditor Collateral Agreement.  Any Proceeds received directly by the Issuer in payment of any Account or Leases or in payment for, or in respect of, any of the Managed Containers or on account of any of the Contracts to which the Issuer is a party shall be promptly deposited by the Issuer in precisely the form received (with all necessary endorsements) in the Trust Account, and until so deposited shall be deemed to be held in trust by the Issuer as the Indenture Trustee’s property and shall continue to be collateral security for all of the obligations secured by this Indenture and shall not constitute payment thereof until applied as hereinafter provided.  If (i) an Event of Default has occurred, (ii) any Sale of the Collateral pursuant to Section 816 hereof shall have occurred or (iii) a Manager Default has occurred, the Issuer shall at the request of the Indenture Trustee, acting with the consent of or at the direction of the Requisite Global Majority, to the extent practicable and to the extent the Issuer possesses such documents, take such action pursuant to the Intercreditor Collateral Agreement as may be specified by the Requisite Global Majority, and deliver to the Indenture Trustee (or such other Person as the Indenture Trustee may direct) originals (or, to the extent originals cannot be delivered, copies) of all other documents evidencing, and relating to, the sale and delivery of the Managed Containers, and the Issuer shall, to the extent practicable and to the extent the Issuer possesses such documents, deliver originals (or, to the extent originals cannot be delivered, copies) of all other documents evidencing and relating to, the performance of any labor, maintenance, remarketing or other service which created such Accounts, including, without limitation, all original orders, invoices and shipping receipts.  The Issuer shall be required to deliver or disclose any information, data, document or agreement which is proprietary to the Issuer, only to the extent required by the terms of the Management Agreement.
 
Section 402.                 Pro Rata Interest .
 
(a)       Except as expressly provided for herein and in any Supplement, the Notes of all Outstanding Series shall be equally and ratably entitled to the benefits of this Indenture without preference, priority or distinction, all in accordance with the terms and provisions of this Indenture and the related Supplement.  All Notes of a particular Class issued hereunder are and are to be, to the extent (including any exceptions) provided in this Indenture and the related Supplement, equally and ratably secured by this Indenture without preference, priority or distinction on account of the actual time or times of the authentication or delivery of the Notes so that all Notes of a particular Series and Class at any time Outstanding (including Notes owned by the Seller and its Affiliates, other than the Issuer) shall have the same right, Lien and preference under this Indenture and shall all be equally and ratably secured hereby with like effect as if they had all been executed, authenticated and delivered simultaneously on the date hereof.
 
(b)       With respect to each Series of Notes, the execution and delivery of the related Supplement shall be upon the express condition that if the conditions specified in Section 701 of this Indenture are met with respect to such Series of Notes, the security interest and all other estate and rights granted by this Indenture with respect to such Series of Notes shall cease and become null and void and all of the property, rights, and interest granted as security for the Notes of such Series shall revert to and revest in the Issuer without any other act or formality whatsoever.
 
 
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Section 403.                 Indenture Trustee’s Appointment as Attorney-in-Fact .
 
(a)       The Issuer hereby irrevocably constitutes and appoints Indenture Trustee, and any officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of the Issuer and in the name of the Issuer or in its own name, from time to time, for the purpose of carrying out the terms of this Indenture, to take any and all action and to execute and deliver any and all documents and instruments which may be necessary or desirable to accomplish the purposes of this Indenture; provided, however, that the Indenture Trustee has no obligation or duty to take such action nor to determine whether to perfect, file, record or maintain any perfected, filed or recorded document or instrument (all of which the Issuer shall prepare, deliver and instruct the Indenture Trustee to execute) in connection with the grant or security interest in the Collateral hereunder.
 
(b)       The Indenture Trustee shall not exercise the power of attorney or any rights granted to the Indenture Trustee pursuant to this Section 403 unless an Event of Default shall have occurred and then be continuing.  The Issuer hereby ratifies, to the extent permitted by law, all actions that said attorney shall lawfully do or cause to be done by virtue hereof.  The power of attorney granted pursuant to this Section 403 is a power coupled with an interest and shall be irrevocable until all Series of Notes are paid and performed in full.
 
(c)       The powers conferred on the Indenture Trustee hereunder are solely to protect Indenture Trustee’s interests in the Collateral and shall not impose any duty upon it to exercise any such powers except as set forth herein.  The Indenture Trustee shall be accountable only for amounts that it actually receives as a result of the exercise of such powers and neither it nor any of its officers, directors, employees, agents or representatives shall be responsible to the Issuer for any act or failure   to act, except for its own negligence or willful misconduct.
 
(d)       The Issuer also authorizes (but does not obligate) the Indenture Trustee, with the consent of or at the direction of the Requisite Global Majority and subject to the terms of the Intercreditor Collateral Agreement to (i) so long as a Manager Default is continuing, communicate with any party to any Contract or Lease relating to a Managed Container with regard to the assignment of the right, title and interest of the Issuer in and under the Contracts or Leases relating to a Managed Container hereunder and other matters relating thereto and (ii) so long as an Event of Default is continuing, execute, in connection with the sale of Collateral provided for in Article VIII hereof, any endorsements, assignments or other instruments of conveyance or transfer with respect to the Collateral.
 
(e)       If the Issuer fails to perform or comply with any of its agreements contained herein and the Indenture Trustee, with the consent of and at the direction of the Requisite Global Majority, shall perform or comply, or otherwise cause performance or compliance, with such agreement, the reasonable expenses, including attorneys’ fees and expenses, of Indenture Trustee incurred in connection with such performance or compliance together with interest thereon at the rate specified in the related Supplement, shall be payable by the Issuer to the Indenture Trustee on demand and shall constitute additional Outstanding Obligations secured hereby.
 
 
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Section 404.                 Release of Security Interest .
 
The Indenture Trustee, at the written direction of the Manager, shall release from the Lien of this Indenture, any Managed Container and the Related Assets sold, transferred, exchanged or disposed of in a transaction that is permitted in accordance with Section 606(a) hereof.  In effectuating such release, the Indenture Trustee shall be provided with and shall be entitled to rely on: (A) so long as no Early Amortization Event is then continuing, a written direction of the Manager (with a copy to the Administrative Agent) identifying each Managed Container or other items to be released from the Lien of this Indenture in accordance with the provisions of this Section 404 accompanied by an Asset Base Certificate, or (B) (x) if an Early Amortization Event is then continuing, all of the following: (i) the items set forth in clause (A) above, and (ii) a certificate from the Manager (with a copy to the Administrative Agent) stating that such release is in compliance with Sections 404 and 606(a) hereof and (y) if a Manager Default is then continuing, the prior consent of the Requisite Global Majority shall also be required with respect to each such release.  The Indenture Trustee shall, at the expense of the Issuer, execute documents prepared by, or on behalf of, the Issuer evidencing such release was made in accordance with the provisions of this Section 404.  The Issuer is authorized to file any UCC partial releases in the appropriate jurisdictions with respect to such released Containers.
 
The Indenture Trustee will, promptly upon receipt of such certificate from the Manager and at the Issuer’s expense, execute and deliver to the Issuer, the Seller or, the Manager, as appropriate, the Administrative Agent and each Interest Rate Hedge Provider, a non-recourse certificate of release substantially in the form of Exhibit D hereto and such additional documents and instruments as that Person may reasonably request to evidence the termination and release from the Lien of this Indenture of such Container and the other related items of Collateral.
 
Section 405.                 Administration of Collateral; Manager Transfer Facilitator Agreement and Intercreditor Collateral Agreement .
 
(a)       The Indenture Trustee shall promptly as practicable notify the Noteholders, the Administrative Agent and the Manager Transfer Facilitator of any Manager Default of which a Corporate Trust Officer has actual knowledge.  If a Manager Default shall have occurred and then be continuing, the Indenture Trustee, in accordance with the written direction of the Requisite Global Majority, shall, subject to the terms of the Intercreditor Collateral Agreement, deliver to the Manager (with a copy to the Administrative Agent, each Rating Agency, and the Manager Transfer Facilitator) a Manager Termination Notice terminating the Manager of its responsibilities in accordance with the terms of the Management Agreement. If a Replacement Manager acceptable to the Requisite Global Majority has not assumed the servicing of the Managed Containers that are Terminated Containers within sixty (60) days after the date of delivery of the Manager Termination Notice, then the Indenture Trustee may and shall, at the direction of the Requisite Global Majority, appoint, or petition a court of competent jurisdiction to appoint as a successor Manager, a Person acceptable to the Requisite Global Majority, having a net worth of not less than $15,000,000 and whose regular business includes marine cargo container leasing and/or container chassis leasing. In no event shall either the Indenture Trustee or the Manager Transfer Facilitator be required to act as Manager hereunder. In connection with the appointment of a Replacement Manager, the Indenture Trustee or Administrative Agent may, with the written consent of the Requisite Global Majority, make such arrangements for the compensation of such Replacement Manager out of Collections as the Indenture Trustee (acting in accordance with the Requisite Global Majority), the Administrative Agent and such Replacement Manager shall agree; provided, however, that in no event shall the Indenture Trustee or the Manager Transfer Facilitator be liable to any Replacement Manager for such compensation.  The terminated Manager shall not be entitled to receive any Management Fee or other amounts owing to it pursuant to the Management Agreement for any period after the effective date of such replacement, but shall be entitled to receive any such amounts earned or accrued through the effective date of such replacement which amounts shall be payable in accordance with Section 302 of this Indenture.  The Indenture Trustee shall take such action, consistent with the Management Agreement and the other Related Documents, as shall be reasonably necessary to effectuate any such succession including exercising the power of attorney granted by the Manager pursuant to Section 10.4 of the Management Agreement.
 
 
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(b)     Upon a Corporate Trust Officer obtaining actual knowledge or the receipt of notice by the Indenture Trustee that any repurchase obligations of the Seller under the Contribution and Sale Agreement have arisen, the Indenture Trustee shall notify the Administrative Agent, each Rating Agency and each Noteholder of such event and shall enforce such repurchase obligations at the written direction of the Requisite Global Majority.
 
Section 406.                 Quiet Enjoyment .
 
The security interest hereby granted to the Indenture Trustee by the Issuer is subject to the right of any lessee to the quiet enjoyment of any Managed Container under lease to such lessee for so long as such lessee is not in default under the Lease therefor and the Manager under the Management Agreement (including any Replacement Manager) or the Indenture Trustee (as provided in Section 405 hereof) continues to receive all amounts payable under such Lease.
 
Section 407.                  Intercreditor Collateral Agreement and Manager Transfer Facilitator Agreement .
 
The Indenture Trustee is hereby authorized and instructed to enter into the Intercreditor Agreement, and the Manager Transfer Facilitator Agreement, and to abide by the respective terms thereof.
 
 
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ARTICLE V
 
RIGHTS OF NOTEHOLDERS; ALLOCATION
AND APPLICATION OF NET ISSUER PROCEEDS;
REQUISITE GLOBAL MAJORITY
 
Section 501.                 Rights of Noteholders .
 
The Noteholders of each Series shall have the right to receive, to the extent necessary to make the required payments with respect to the Notes of such Series at the times and in the amounts specified in the related Supplement, (i) the portion of Collections allocable to Noteholders of such Series pursuant to this Indenture and the related Supplement, (ii) funds on deposit in the Trust Account (subject to the priorities set forth in Section 302 hereof) and the Restricted Cash Account, and (iii) funds on deposit in any Series Account for such Series or Class.  Each Noteholder, by acceptance of its Notes, (a) acknowledges and agrees that (except as expressly provided herein and in a Supplement entered into in accordance with Section 1006(b) hereof) the Noteholders of a Series or Class shall not have any interest in any Series Account (or any amounts on deposit therein) for the benefit of any other Series or Class and (b) ratifies and confirms the terms of this Indenture and the Related Documents executed in connection with such Series.
 
Section 502.                 Allocations Among Series .
 
With respect to each Collection Period, Collections on deposit in the Trust Account will be allocated to each Series then Outstanding in accordance with Article III of this Indenture and the Supplements.
 
Section 503.                Determination of Requisite Global Majority .
 
A Requisite Global Majority shall exist with respect to any action proposed to be taken pursuant to the terms of this Indenture or any Supplement if the Control Party or Control Parties representing more than fifty percent (50%) of the sum of the Existing Commitments of all Series then Outstanding shall approve or direct such proposed action (in making such a determination, each Control Party shall be deemed to have voted the entire Existing Commitment of the related Series in favor of, or in opposition to, such proposed action, as the case may be). The Indenture Trustee shall be responsible for identifying the Requisite Global Majority in accordance with the terms of this Section 503.
 
ARTICLE VI
 
COVENANTS
 
For so long as any Aggregate Outstanding Obligation of the Issuer remains outstanding  the Issuer shall observe each of the following covenants:
 
 
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Section 601.                 Payment of Principal and Interest, Payment of Taxes .
 
(a)     The Issuer will duly and punctually pay the principal of and interest on the Notes in accordance with the terms of the Notes, this Indenture and the related Supplement.
 
(b)     The Issuer will take all actions as are necessary to insure that all taxes and governmental claims, if any, in respect of the Issuer’s activities and assets are promptly paid.
 
Section 602.                 Maintenance of Office .
 
(a)     The only “place of business” (within the meaning of Section 9-307 of the UCC) of the Issuer is located   at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda.  The Issuer shall not establish a new place of business or location for its chief executive office outside of Bermuda or change the jurisdiction of its incorporation unless (i) it shall have given to the Indenture Trustee, each Rating Agency, the Administrative Agent and each Interest Rate Hedge Provider not less than sixty (60) days’ prior written notice of its intention so to do, clearly describing such new location and providing such other information in connection therewith as the Indenture Trustee, the Administrative Agent or any Interest Rate Hedge Provider may reasonably request, (ii) not less than fifteen (15) days’ prior to the effective date of such relocation, the Issuer shall have taken, at its own cost, all action necessary so that such change of location does not impair the security interest of the Indenture Trustee in the Collateral, or the perfection of the sale or contribution of the containers to the Issuer, and shall have delivered to the Indenture Trustee, the Administrative Agent and each Interest Rate Hedge Provider copies of all filings required in connection therewith and (iii) the Issuer has delivered to the Indenture Trustee, the Administrative Agent, each Eligible Interest Rate Hedge Provider and each Rating Agency, one or more Opinions of Counsel satisfactory to the Requisite Global Majority, stating that, after giving effect to such change of location: (A) the Seller and the Issuer will not, pursuant to applicable Insolvency Law, be substantively consolidated in the event of any Insolvency Proceeding by, or against, the Seller, (B) under applicable Insolvency Law, the transfers of Transferred Assets made in accordance with the terms of the Related Documents will be treated as a “true sale” in the event of any Insolvency Proceeding by, or against, either Seller, and (C) either (1) in the opinion of such counsel, all registration of charges, financing statements, or other documents of similar import, and amendments thereto have been executed and filed that are necessary to fully preserve and protect the interest of the Issuer and the Indenture Trustee in the Transferred Assets, or (2) stating that, in the opinion of such counsel, no such action shall be necessary to preserve and protect such interest.
 
(b)     The Issuer shall not maintain a place of business within the United States of America.
 
Section 603.                 Corporate Existence .
 
The Issuer will keep in full effect its existence, rights and franchises as an exempted company with limited liability incorporated under the laws of Bermuda, and will obtain and preserve its qualification in each jurisdiction in which such qualification is necessary to protect the validity and enforceability of this Indenture, any Supplements issued hereunder and the Notes.
 
 
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Section 604.                 Protection of Collateral .
 
The Issuer, at its expense, will cause this Indenture and any Control Agreement to be registered under Section 55 of the Companies Act 1981 of Bermuda in the Register of Charges kept at the Office of the Registrar of Companies of Bermuda (or under any statute enacted in lieu thereof and for the time being in force, or under any law of general application relating to the registration of mortgages of or charges upon personal property for the time being in force in the Islands of Bermuda).   In addition, the Issuer will from time to time execute and deliver all amendments thereto and all such financing statements, continuation statements, instruments of further assurance and other instruments, and will, upon the reasonable request of the Manager, the Indenture Trustee, the Administrative Agent or any Interest Rate Hedge Provider, take such other action necessary or advisable to:
 
(a)       grant more effectively the security interest in all or any portion of the Collateral;
 
(b)     maintain or preserve the Lien of this Indenture (and the priority thereof) or carry out more effectively the purposes hereof including executing and filing such documents, as may be required under any international convention for the perfection of interests in containers that may be adopted subsequent to the date of this Indenture;
 
(c)       perfect, publish notice of, or protect the validity of the security interest in the Collateral created pursuant to this Indenture;
 
(d)     enforce any of the items of the Collateral;
 
(e)       preserve and defend its right, title and interest to the Collateral and the rights of the Indenture Trustee in such Collateral against the claims of all Persons (other than the Noteholders or any Person claiming through the Noteholders);
 
(f)       pay any and all taxes levied or assessed upon all or any part of the Collateral;
 
(g)     pay any and all fees, taxes and other charges payable in connection with the registration of this Indenture and any Supplement with the Office of the Registrar of Companies of Bermuda or any other Governmental Authority; or
 
(h)     notify such parties of any Commercial Tort Claims in which the Issuer has rights that arise after the Closing Date and exceed $250,000 and take such actions necessary to create and perfect the Indenture Trustee’s Lien therein.
 
In furtherance of clauses (b) and (c) above, the Issuer hereby agrees that if at any time subsequent to a Closing Date there is a change in Applicable Law (or a change in the interpretation of Applicable Law as in effect on such Closing Date) which, in the reasonable judgment of the Requisite Global Majority, may affect the perfection of the Indenture Trustee’s security interest in the Collateral, then the Issuer shall, within thirty (30) days after written request from the Requisite Global Majority, furnish to the Indenture Trustee, the Administrative Agent and each Rating Agency, an Opinion of Counsel either (i) stating that, in the opinion of such counsel, such action has been taken with respect to the recording, filing, re-recording and refiling of this Indenture, any Supplements hereto and any other requisite documents, and with respect to the execution and filing of any financing statements and continuation statements, as are necessary to maintain the Lien created by this Indenture and reciting the details of such action, or (ii) stating that, in the opinion of such counsel, no such action is necessary to maintain such Lien.  Such Opinion of Counsel shall also describe the recording, filing, re-recording and refiling of this Indenture, any Supplements hereto and any other requisite documents and the execution and filing of any financing statements and continuation statements that, in the opinion of such counsel, are required to maintain the Lien and security interest of this Indenture. In furtherance of clause (h) above, the Issuer hereby confirms that it does not currently have any rights with respect to Commercial Tort Claims as of the Closing Date.
 
 
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Section 605.                 Performance of Obligations .
 
Except as otherwise permitted by this Indenture, the Management Agreement or the Contribution and Sale Agreement, the Issuer will not take, or fail to take, any action, and will use its best efforts not to permit any action to be taken by others, which would release any Person from any of such Person’s covenants or obligations under any agreement or instrument included in the Collateral (excluding any Interest Rate Hedge Agreement), or which would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, any such agreement or instrument (excluding any Interest Rate Hedge Agreement).
 
Section 606.                  Negative Covenants
 
.  The Issuer will not, without (i) the prior written consent of the Requisite Global Majority and (ii) satisfaction of the Rating Agency Condition:
 
(a)       at any time sell, transfer, exchange or otherwise dispose (collectively, “Dispositions”) of any of the Collateral, except as follows:
 
(i)             in connection with a sale to Persons that are not Prohibited Persons following the occurrence of an Event of Default pursuant to Section 816 hereof;
 
(ii)         Dispositions of one or more Managed Containers or Finance Leases to Persons that are not Prohibited Persons so long as (x) after giving effect to each such Disposition, no Early Amortization Event nor an Event of Default is then continuing or would result from the Disposition of such Managed Containers, and (y) the net cash sales proceeds realized by the Issuer from such Disposition of Managed Containers or Finances Leases shall equal or exceed an amount equal to the greater of (A) the sum of the then Net Book Values of all such Managed Containers and the Finance Lease Balance of such Finance Leases (as the case may be) and (B) the sum of the then Fair Market Values of all such sold Managed Containers or Finance Leases;
 
(iii)          if an Early Amortization Event but no Event of Default is then continuing or would result from such sale of Managed Containers, sales of one or more Managed Containers to Persons that are not Prohibited Persons in the normal course of business (including any such Dispositions resulting from the sell/repair decision of the Manager) so long as the sum of the Net Book Values of all Managed Containers that were subject to Dispositions for less than Net Book Value during the four (4) immediately preceding Collection Periods shall not exceed an amount equal to the product of (x) ten percent (10%) and (y) an amount equal to the quotient of (i) the sum of the aggregate Net Book Value as of the last day of each of the four (4) immediately preceding Collection Periods, divided by (ii) four (4); provided that the sale price of each such Managed Container (including payments for damage) shall not be subject to Disposition for less than an amount equal to the Fair Market Value for such Managed Container;
 
 
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(iv)          in connection with a repurchase or substitution by the Seller to remedy a breach of a Container Representations and Warranties;
 
(v)         in connection with the sale of a Managed Container to the related Lessee pursuant to the terms of a Finance Lease; or
 
(vi)          any other Dispositions of Managed Containers to Persons that are not Prohibited Persons not covered by clauses (i) through (v) inclusive,  provided that each such sale must be specifically approved in writing by the Requisite Global Majority;
 
(b)       claim any credit on, make any deduction from the principal, premium, if any, or interest payable in respect of the Notes (other than amounts properly withheld from such payments under any Applicable Law) or assert any claim against any present or former Noteholder by reason of the payment of any taxes levied or assessed upon any of the Collateral;
 
(c)       (i)  permit the validity or effectiveness of this Indenture to be impaired, or (ii) permit the Lien of this Indenture with respect to the Collateral (excluding any Interest Rate Hedge Agreement) to be subordinated, terminated or discharged, except as permitted with respect to a sale of such Collateral made in accordance with Section 404, this Section 606 or Article VII hereof or upon payment in full of all Aggregate Outstanding Obligations, or (iii) permit any Person to be released from any covenants or obligations with respect to such Collateral (excluding any Interest Rate Hedge Agreement), except as may be expressly permitted by the Management Agreement or the Contribution and Sale Agreement;
 
(d)       permit any Lien (except any Permitted Encumbrance) to be created on or extend to or otherwise arise upon or burden the Collateral or any part thereof or any interest therein or the Proceeds thereof other than the Lien created pursuant to this Indenture;
 
(e)        permit the Lien of this Indenture not to constitute a valid first priority   perfected security interest   in the Collateral;
 
(f)       fail to maintain the registration of this Indenture with the Office   of the Registrar of Companies of Bermuda or fail to maintain the effectiveness of any required UCC financing statements filed in the applicable jurisdictions; or
 
 
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(g)       for purposes of the Asset Base calculation only (and not with respect to GAAP accounting matters), revise the Depreciation Policy with respect to the Managed Containers in such a way as to shorten the period of depreciable life or reduce the amount of depreciation expense that would be recorded in any year from that which would have been recorded pursuant to the Depreciation Policy then in effect without obtaining in each such instance (i) the prior written consent of the Requisite Global Majority and (ii) evidence that the Rating Agency Condition shall have been satisfied.
 
Section 607.                  Non-Consolidation of Issuer .
 
(a)     The Issuer shall be operated in such a manner that it shall not be substantively consolidated with the estate of any other Person in the event of the bankruptcy or insolvency of the Issuer or such other Person.  Without limiting the foregoing, the Issuer shall (1) conduct its business in its own name, (2) except as required for reporting with the Securities and Exchange Commission or for GAAP accounting with respect to Manager's and CAI's publicly-disclosed financial results, maintain its books, records and bank accounts separate from those of any other Person, (3) not commingle its funds with those of any other Person (except as contemplated by the Intercreditor Collateral Agreement and for any commingling of monies attributable to the Managed Containers that are on deposit in the Manager Collection Account until such time as such monies are transferred to the Trust Account in accordance with the terms of the Management Agreement), (4) maintain separate financial statements, showing its assets and liabilities separate and apart from those of any other Person and, to the extent that the Issuer’s assets, liabilities, expenses, revenues, and other financial information are required to be included in any consolidated financial statement, a note will be included in such financial statements that indicates that the Issuer is a separate legal entity from the other members of the consolidated group, its assets are not assets of any other member of the consolidated group, and its assets are not available to the creditors of any other member of the consolidated group, (5) other than with respect to Manager Advances, pay its own liabilities and expenses out of its own funds, (6) enter into a transaction with an Affiliate only if such transaction is intrinsically fair, commercially reasonable and on the same terms as would be available in an arm’s length transaction with a Person or entity that is not an Affiliate (provided, any transaction between the Issuer and an Affiliate pursuant to the Management Agreement, the Contribution and Sale Agreement shall be deemed to have satisfied this clause (6)), (7) allocate fairly and reasonably any overhead expenses that are shared with an Affiliate, (8) hold itself out as a separate entity and maintain adequate capital in light of its contemplated business operations and (9) observe all other organizational formalities.
 
(b)     Notwithstanding any provision of law which otherwise empowers the Issuer, the Issuer shall not (1) hold itself out as being liable for the debts of any other Person, (2) act other than in its corporate name and through its duly authorized officers or agents, (3) engage in any joint activity or transaction of any kind with or for the benefit of any Affiliate including any of the transactions described in Section 611 hereof, except (i) payment of lawful distributions to its members and (ii) the execution, delivery and performance of the Management Agreement, (4) enter into any transaction that is prohibited pursuant to the provisions of Section 610 herein or (5) take any other action that would be inconsistent with maintaining the separate legal identity of the Issuer or engage in any other activity not contemplated by this Indenture and the Related Documents.
 
 
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Section 608.                  No Bankruptcy Petition .
 
The Issuer shall not (1) commence any Insolvency Proceeding seeking to have an order for relief entered with respect to it, or seeking reorganization, arrangement, adjustment, wind-up, liquidation, dissolution, composition or other relief with respect to it or its debts, (2) seek appointment of a receiver, trustee, custodian or other similar official for it or any part of its assets, (3) make a general assignment for the benefit of creditors, or (4) take any action in furtherance of, or consenting or acquiescing in, any of the foregoing.
 
Section 609.                  Liens .
 
The Issuer shall not (i) permit any Lien (except any Permitted Encumbrance) to be created on or extend to or otherwise arise upon or burden the Collateral or any part thereof or any interest therein or the Proceeds thereof; or (ii) permit the Lien of this Indenture not to constitute a valid first priority security interest in the Collateral.
 
Section 610.                 Other Indebtedness .
 
The Issuer shall not contract for, create, incur, assume or suffer to exist any Indebtedness except (i) any Notes issued pursuant to this Indenture or any Supplement issued hereunder, (ii) obligations incurred in accordance with the terms of the Related Documents including, without limitation, Manager Advances and Management Fees incurred in accordance with the terms of the Management Agreement, (iii) trade payables and expense accruals incurred in the ordinary course and which are incidental to the purposes permitted pursuant to the Issuer’s charter documents and (iv) Interest Rate Hedge Agreements required or permitted pursuant to the terms of the related Supplement.  For the avoidance of doubt, the Issuer shall not incur any Indebtedness for borrowed money other than pursuant to clauses (i) and (iv) of this Section 610.
 
Section 611.                 Guarantees, Loans, Advances and Other Liabilities .
 
The Issuer will not make any loan, advance or credit to, or guarantee (directly or indirectly or by an instrument having the effect of assuring another’s payment or performance on any obligation or capability of so doing, or otherwise), endorse (except for the endorsement of checks for collection or deposit) or otherwise become contingently liable, directly or indirectly, in connection with the obligations, shares, stock or dividends of, or own, purchase, repurchase or acquire (or agree contingently to do so) any share, stock, obligations or securities of, or any other interest in, or make any capital contribution to, any other Person.
 
Section 612.                 Consolidation, Amalgamation, Merger and Sale of Assets; Ownership of the Issuer .
 
(a)     The Issuer shall not consolidate with, amalgamate or merge with or into any other Person or sell, convey, transfer or lease all or substantially all of its assets, whether in a single transaction or a series of transactions, to any Person, except for (i) any such sale, conveyance or transfer contemplated in this Indenture or any Supplement issued hereunder and (ii) any Lease of a Managed Container in accordance with the terms of the Management Agreement.
 
 
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(b)     The obligations of the Issuer hereunder shall not be assignable nor shall any Person succeed to the obligations of the Issuer hereunder except in each case in accordance with the provisions of this Indenture.
 
(c)     The Issuer shall give prior written notice to the Rating Agencies of any action pursuant to this Section 612.
 
Section 613.                  Other Agreements .
 
The Issuer will not after the date of the issuance of the Notes enter into or become a party to any agreements or instruments other than (i) this Indenture, the Supplements, the Contribution and Sale Agreement, the Management Agreement, the Note Purchase Agreement, the other Related Documents for any Series of Notes and any agreements or instruments contemplated under the foregoing agreements listed in this clause (i), (ii) any agreement pursuant to which the Issuer issues additional shares to any other Person, (iii) any indemnification agreements with officers and directors of the Issuer provided that any payments owing by the Issuer thereunder shall be payable only to the extent set forth in Section 302 hereof, (iv) any agreement among the Issuer and one or more Affiliates with respect to the payment and accounting treatment of routine administrative expenses incurred by or on behalf of the Issuer in the normal course of its business, (v) any Interest Rate Hedge Agreement required or permitted pursuant to the terms of the related Supplement, (vi) the Intercreditor Collateral Agreement and (vii) any other agreement(s) contemplated by any Related Document, including, without limitation, any agreement(s) for disposition of the Transferred Assets permitted by Sections 404, 606(a), 804 or 816 hereof and any agreement(s) for the sale, repurchase, lease or re-lease of a container made in accordance with the provisions of the Contribution and Sale Agreement or the Management Agreement.  In addition, the Issuer will not amend, modify or waive any provision of the Contribution and Sale Agreement, the Management Agreement or any other Related Documents or give any approval or consent or permission provided for therein without the prior written consent of the requisite Persons set forth in the Contribution and Sale Agreement, the Management Agreement or such other Related Documents, respectively, except to the extent such waiver, modification or amendment is permitted pursuant to the terms of such agreement.
 
Section 614.                  Charter Documents .
 
The Issuer will not amend or modify its memorandum of association or bye-laws or issue shares to any Person other than CAL, in each case, without (i) the prior written consent of the Requisite Global Majority and (ii) the prior written notice to the Rating Agencies and satisfaction of the Rating Agency Condition.
 
Section 615.                 Capital Expenditures .
 
The Issuer will not make any expenditure (by long-term or operating lease or otherwise) for capital assets (both realty and personalty), except for (a) acquisition of additional containers made in accordance with the terms of the Management Agreement or (b) capital improvements to the containers in the ordinary course of its business and in accordance with the Management Agreement.
 
 
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Section 616.                 Permitted Activities .
 
The Issuer will not engage in any activity or enter into any transaction except as permitted under its memorandum of association or bye-laws as in effect on the date   on which this Indenture is executed.  The Issuer will observe all organizational and managerial procedures required by its constitutional documents and Applicable Law.  The Issuer shall (i) keep complete minutes of the meetings and other proceedings of the Issuer and (ii) continuously maintain the resolutions, agreements and other instruments underlying the transaction contemplated by the Related Documents.
 
Section 617.                 Investment Company .
 
The Issuer will conduct its operations in a manner which will not subject it to registration as an “investment company” under the Investment Company Act of 1940, as amended.
 
Section 618.                  Payments of Collateral .
 
If the Issuer shall receive from any Person any payments with respect to the Collateral (to the extent such Collateral has not been released from the Lien of this Indenture in accordance with Section 404 hereof), the Issuer shall receive such payment in trust for the Indenture Trustee, as secured party hereunder, and subject to the Indenture Trustee’s security interest and shall, by not later than one Business Day after receipt thereof, deposit such payment in the Trust Account.
 
Section 619.                  Notices .
 
The Issuer shall notify the Indenture Trustee, the Administrative Agent, each Rating Agency, each Interest Rate Hedge Provider and the Manager Transfer Facilitator (but in the case of the Manager Transfer Facilitator only with respect to the occurrence of an Event of Default under the Management Agreement) in writing of any of the following immediately upon learning of the occurrence thereof, describing the same and, if applicable, the steps being taken by the Person(s) affected with respect thereto:
 
(a)       Event of Default.  The occurrence of an Event of Default and any acceleration of any Notes hereunder;
 
(b)       Litigation.  The institution of any litigation, arbitration proceeding or Proceeding before any Governmental Authority which might reasonably be expected to have or result in a Material Adverse Change;
 
(c)       Material Adverse Change.  The occurrence of a Material Adverse Change;
 
(d)     Other Events.  The occurrence of an Early Amortization Event or such other events that may, with the giving of notice or the passage of time or both, constitute an Event of Default; and
 
(e)     Management Agreement.  The occurrence of an “Event of Default” under the Management Agreement.
 
 
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Section 620.                 Books and Records .  The Issuer shall, and shall cause the Manager to, maintain complete and accurate books and records in which full and correct entries in conformity with GAAP shall be made of all dealings and transactions in relation to its business and activities.  In connection with each transfer of Transferred Assets, the Issuer shall report, or cause to be reported, on its financial records the transfer of the Transferred Assets as a purchase under GAAP.  The Issuer will ensure that no financial statement, nor any consolidated financial statements of the Issuer, suggests that the assets of the Issuer are available to pay the debts of the Seller, the Manager, or any of their Affiliates.
 
Section 621.                Taxes .  The Issuer shall, or shall cause the Manager to, pay when due, all of its taxes, unless and only to the extent that Issuer is contesting such taxes in good faith and by appropriate Proceedings and Issuer has set aside on its books such reserves or other appropriate provisions therefor as may be required by GAAP.
 
Section 622.                  Subsidiaries .  The Issuer shall not create any Subsidiaries.
 
Section 623.                  Investments .  The Issuer shall not make or permit to exist any Investment in any Person except for Investments in Eligible Investments made in accordance with the terms of this Indenture.
 
Section 624.                 Use of Proceeds .  The Issuer shall use the proceeds of the Notes only for general corporate purposes including the purchase of the Managed Containers, the distribution of dividends, paying down debt  and paying the costs of the issuance of the Notes.  In addition, Issuer shall not permit any proceeds of the Notes to be used, either directly or indirectly, for the purpose, whether immediate, incidental or ultimate, of “purchasing or carrying any margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System, as amended from time to time, and shall furnish to each Holder, upon its request, a statement in conformity with the requirements of Regulation U.
 
Section 625.                  Purchase of Additional Containers .
 
The Issuer shall not use funds classified as an Issuer Expense to purchase additional Containers.
 
Section 626.                 Financial Statements .
 
The Issuer shall deliver (or shall cause the Manager to deliver) to the Indenture Trustee, each Rating Agency and the Administrative Agent, (a) quarterly financial statements of each of (i) the Issuer, and (ii) CAI and its consolidated Subsidiaries, in each case within sixty (60) days of the end of each fiscal quarter (commencing with the fiscal quarter ended September 30, 2012), and (b) annual financial statements of each of (i) the Issuer, and (ii) CAI and its consolidated Subsidiaries, in each case audited by their regular Independent Accountants, within one hundred twenty (120) days of the end of each fiscal year ending on and after December 31, 2010.  All financial statements shall be prepared in accordance with GAAP.  For so long as CAI files its financial statements with the U.S. Securities and Exchange Commission, CAI will be deemed to have delivered its financial statements upon the filing of such financial statements with the U.S. Securities and Exchange Commission.  Delivery of such reports, information and documents to the Indenture Trustee is for informational purposes only and the Indenture Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Issuer’s compliance with any of its covenants hereunder (as to which the Indenture Trustee is entitled to rely exclusively on Officer’s Certificates).
 
 
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Section 627.                  OFAC .
 
The Issuer shall not (i) in a manner which would violate the laws of the United States, other than pursuant to a license issued by OFAC, lease, or consent to any sublease of, any of the Containers to any Person that is a Prohibited Person or (ii) derive any of its assets or operating income from investments in or transactions with any such Prohibited Person. If the Issuer obtains knowledge that a Container is subleased to a Prohibited Person or located or used in a Prohibited Jurisdiction in a manner which would violate the laws of the United States (other than pursuant to a license issued by OFAC), then the Issuer shall, within ten (10) Business Days after obtaining knowledge thereof, remove such Container from the Asset Base for so long as such condition continues.
 
Section 628.                 UNIDROIT Convention .
 
The Issuer shall comply with the terms and provisions of the UNIDROIT Convention or any other internationally recognized system for recording interests in or liens against shipping containers at the time that such convention is adopted by the container leasing industry.
 
Section 629.                 Other Information .
 
For so long as any of the Notes are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act and the Issuer is not subject to Section 13 or 15(d) of the Exchange Act, the Issuer will, and shall cause Manager to, (i) provide or cause to be provided to any Holder of Notes and any prospective purchaser thereof designated by such a Holder, upon the request of such Holder or prospective purchaser, the information required to be provided to such Holder or prospective purchaser by Rule 144A(d)(4) under the Securities Act; and (ii) update such information to prevent such information from becoming materially false and materially misleading in a manner adverse to any Noteholder.
 
Section 630.                 Separate Identity .
 
The Issuer will be operated, or will cause itself to be operated, so that the Issuer will not be substantively consolidated with CAI, the Manager or any of their Affiliates.
 
Section 631.                  Amendment of Intercreditor Collateral Agreement; Termination of Management Agreement .
 
(a)     Prior to the initial Funding Date of the first Series of Notes, the Issuer shall not, without the prior written consent of the Requisite Global Majority, consent to any amendment, modification or revision to the Intercreditor Collateral Agreement except any amendment, modification or revision: (i) to add parties to the Intercreditor Agreement pursuant to an Investor Supplemental Agreement, Non-Revolving Lender Supplemental Agreement or a CAI Subsidiary Supplemental Agreement; and (ii) that do not adversely affect any Noteholder’s priority of payments shall not be deemed such an amendment, modification or revision, so long as an Opinion of Counsel has been delivered to the Indenture Trustee, stating that such amendment of the Intercreditor Collateral Agreement not requiring consent of the Requisite Global Majority, does not adversely affect any Noteholder’s priority of payments, together with an Officer’s Certificate of the Issuer as to the facts surrounding such amendment on which such Opinion of Counsel is based.
 
 
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(b)     The Issuer shall not amend, modify or terminate the Management Agreement or the Contribution and Sale Agreement except in accordance with the terms of such agreement.
 
ARTICLE VII
 
DISCHARGE OF INDENTURE; PREPAYMENTS
 
Section 701.                 Full Discharge .
 
Upon payment in full of the Aggregate Outstanding Obligations, the Indenture Trustee shall, at the request and at the expense of the Issuer, execute and deliver to the Issuer such deeds or other instruments as shall be requisite to evidence the satisfaction and discharge of this Indenture and the security hereby created with respect to the applicable Series, and to release the Issuer from its covenants contained in this Indenture and the related Supplement with respect to such Series.  In connection with the satisfaction and discharge of the Indenture the Indenture Trustee shall be provided with and shall be entitled to conclusively rely upon an Opinion of Counsel stating that such satisfaction and discharge is authorized and permitted.
 
Section 702.                  Prepayment of Notes .
 
(a)       Mandatory Prepayments .  Unless otherwise specified in a Supplement, the Issuer shall be required to prepay the then unpaid principal balance of all, or a portion of, one or more Series of Notes then Outstanding if, on any Payment Date, the then Aggregate Principal Balance exceeds the Asset Base.  Such Prepayment shall be in the amount of such Asset Base Deficiency and shall be paid in accordance with the priority of payments set forth in Section 302 hereof. The calculations referred to herein shall be evidenced by the Manager Report received by the Indenture Trustee on any Determination Date.  Any such Prepayment shall be allocated, first to each Series of Warehouse Notes then Outstanding on a pro rata basis, in proportion to the then unpaid principal balance of such Warehouse Notes, until the principal balances of all Warehouse Notes have been paid in full, and then to all Series of Term Notes then Outstanding on a pro rata basis, in proportion to the then unpaid principal balance of each such Series of Term Notes.  Notwithstanding the foregoing, if sufficient funds are not available to allow the Issuer to prepay the principal balance of the Warehouse Notes in an amount equal to the Asset Base Deficiency on such Payment Date, then the amount of any Supplemental Principal Payment Amount to be actually paid on such Payment Date shall be allocated among all Series of Notes then Outstanding (including the Term Notes) on a pro rata basis, in proportion to the then unpaid principal balance of such Notes.
 
 
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(b)       Voluntary Prepayments .  So long as no Early Amortization Event is then continuing, the Issuer may, from time to time, make an optional Prepayment of principal of the Notes of a Series at the times, in the amounts and subject to the conditions and limitations set forth in the Supplement for the Series of Notes to be prepaid.  If an Early Amortization Event is then continuing, all optional Prepayments made in accordance with the provisions of this Section 702(b) shall be applied in accordance with the applicable provisions of Section 302 hereof.  The Issuer shall promptly confirm any telephonic notice of prepayment in writing.  Any optional Prepayment of principal made by the Issuer pursuant to this Section 702(b) shall also include accrued interest to the date of the prepayment on the amount being prepaid.  Any optional Prepayment made pursuant to the provisions of this Section 702(b) shall be accomplished by a deposit of funds directly into the Trust Account and, unless otherwise specified in the Supplement for any Series of Notes then Outstanding, may be applied by the Issuer to reduce the unpaid principal balance of one or more Series of Notes then Outstanding, such Series to be selected in the sole discretion of the Issuer.  Notice of any voluntary prepayment of a Series of Term Notes to be made by the Issuer pursuant to the provisions of this Section 702(b) shall be given by the Issuer to the Indenture Trustee and, if applicable, the Series of Notes to be prepaid, not later than the tenth (10 th ) day prior to the date of such prepayment and not earlier than the Payment Date immediately preceding the date of such Prepayment.
 
(c)       Repayment of Eligible Interest Rate Hedge Providers .  If the Issuer has elected to make a voluntary Prepayment in accordance with the provisions of Section 702(b) above or is required to make a Prepayment in accordance with the provisions of Section 702(a) above, then in addition to such Prepayment, the Issuer shall pay such amount, including any termination payments, necessary (in each case as determined by the Administrative Agent and after taking account of payment priorities set forth in Section 302 hereunder) to reduce the aggregate notional balance of all outstanding transactions under the Interest Rate Hedge Agreements then in effect to the level required under the related Supplement and not in excess of such requirements by more than the amounts set forth in Section 411(b)(ii) of the related Supplement.  So long as no Early Amortization Event or Event of Default is then continuing, the Issuer (or the Manager on its behalf) may exercise its discretion in selecting the specific transactions and the notional amounts thereof to be terminated.  If an Early Amortization Event or Event of Default is then continuing the outstanding transactions will be terminated on a pro rata basis, based on the respective notional amounts for each remaining calculation period so that the remaining notional amounts for all future calculation periods under such transactions shall comply with the requirements of the related Supplement and not exceed such requirements by more than the amounts set forth in the related Supplement.
 
(d)       Adjustment of Prospective Minimum Principal Payment Amounts and Scheduled Principal Payment Amounts .  In the event that the Issuer makes a prepayment of less than all of the aggregate unpaid principal balance of any Series of Term Notes in accordance with the provisions of Section 702(a) or Section 702(b), then the Issuer shall promptly (but in any event within five (5) Business Days after the date on which such Prepayment is made) thereafter recalculate (subject to verification by the Indenture Trustee) the Minimum Principal Payment Amount and Scheduled Principal Payment Amount for each future Payment Date for each such Series of Notes being prepaid by an amount equal to the quotient of (i) the aggregate amount of the prepayment received by such Series divided by (ii) the number of remaining Payment Dates to and including, (A) the Legal Final Maturity Date (with respect to the Minimum Principal Payment Amount) or (B) the Expected Final Maturity Date (with respect to the Scheduled Principal Payment Amount), for such Series of Notes.
 
 
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Section 703.                Unclaimed Funds .
 
In the event that any amount due to any Noteholder remains unclaimed, the Issuer shall, at its expense, cause to be published once, in the eastern edition of The Wall Street Journal notice that such money remains unclaimed.  Any such unclaimed amounts shall not be invested by the Indenture Trustee (notwithstanding the provisions of Section 303 hereof) and no additional interest shall accrue on the related Note subsequent to the date on which such funds were available for distribution to such Noteholder.  Any such unclaimed amounts shall be held by the Indenture Trustee in trust until the latest of (i) two (2) years after the date of the publication described in the second preceding sentence, (ii) the date all other registered Noteholders of such Series shall have received full payment of all principal, interest, premium, if any, and other sums payable to them on such Notes or the Indenture Trustee shall hold (and shall have notified the registered Noteholders that it holds) in trust for that purpose an amount sufficient to make full payment thereof when due and (iii) the date the Issuer shall have fully performed and observed all its covenants and obligations contained in this Indenture and the related Supplement with respect to such Series of Notes.  Thereafter, any such unclaimed amounts shall be paid to the Issuer by the Indenture Trustee on written demand; and thereupon each of the Indenture Trustee and the Issuer shall be released from all further liability with respect to such monies, and thereafter the registered Noteholders in respect of which such monies were so paid to the Issuer shall have no rights in respect thereof.
 
 
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ARTICLE VIII
 
DEFAULT PROVISIONS AND REMEDIES
 
Section 801.                  Event of Default .
 
“Event of Default”, wherever used herein with respect to any Series of Notes, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any Governmental Authority):
 
(i)          default in (A) the payment on any Payment Date of any Interest Payment or premium, if any, then due and payable on any Series of Notes and such condition continues unremedied for three (3) Business Days, (B) the payment on the applicable Legal Final Maturity Date of the then unpaid principal balance of any Series of Notes, or (C) the payment on any Payment Date of any Indenture Trustee’s Fees then due and payable and such condition continues unremedied for three (3) Business Days;
 
(ii)           default in the payment of other amounts not dealt with in clause (i) above owing to the Noteholders of any Series, and the continuation of such default for more than three (3) Business Days after the same shall have become due and payable in accordance with the terms of such Notes, this Indenture, the related Supplement or any other Related Documents;
 
(iii)          default by the Issuer in the performance, or breach by the Issuer of, a covenant of the Issuer set forth in Section 606, 607 (except clause (a)(4), 608, 609, 610, 611, 612, 613, 614, 615, 616, 622, 623, 627 or 631 of this Indenture and, if curable, such condition continues unremedied for fifteen (15) days;
 
(iv)       default in the performance, or breach, of any covenant of the Issuer or the Seller in any Related Document (to the extent such breach is not otherwise addressed in this Section 801) which breach materially and adversely affects the interest of any Noteholder or any Interest Rate Hedge Provider, and continues for a period of thirty (30) days after the earliest of (i) any Authorized Officer of the Issuer or the Seller, as the case may be, first acquiring knowledge thereof, (ii) the Indenture Trustee’s giving written notice thereof to the Issuer or the Seller, as the case may be, or (iii) any Noteholder giving written notice thereof to the Issuer or the Seller, as the case may be, and the Indenture Trustee; provided, however , that if the Issuer or the Seller, as the case may be, is diligently attempting to effect such cure at the end of such thirty (30) day period, the Issuer or the Seller, as the case may be, shall be entitled to an additional thirty (30) day period in which to complete such cure.
 
(v)           any representation or warranty of the Issuer or the Seller made in any Related Document shall prove to be incorrect in any material respect as of the time when the same shall have been made which breach materially and adversely affects the interest of any Noteholder, any Interest Rate Hedge Provider and continues and, if capable of cure, the continuance of such condition for a period of thirty (30) days after the earliest of (i) any Authorized Officer of the Issuer or the Seller, as the case may be, first acquiring knowledge thereof, (ii) the Indenture Trustee’s giving written notice thereof to the Issuer or the Seller, as the case may be, or (iii) any Noteholder giving written notice thereof to the Issuer or the Seller, as the case may be, and the Indenture Trustee; provided, however , that if the Issuer or the Seller, as the case may be, is diligently attempting to effect such cure at the end of such thirty (30) day period, the Issuer or the Seller, as the case may be, shall be entitled to an additional thirty (30) day period in which to complete such cure;
 
 
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(vi)          the entry of a decree or order for relief by a court having jurisdiction in respect of the Issuer in any involuntary case under any applicable Insolvency Law, or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, or sequestrator (or other similar official) for the Issuer or for any substantial part of its properties, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of thirty (30) consecutive days;
 
(vii)        the commencement by the Issuer of a voluntary case under any applicable Insolvency Law, or other similar law now or hereafter in effect, or the consent by the Issuer to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee or sequestrator (or other similar official) of the Issuer or any substantial part of its properties, or the making by the Issuer of any general assignment for the benefit of creditors, or the failure by the Issuer generally to pay its debts as they become due, or the taking of any action by the Issuer in furtherance of any such action;
 
(viii)      all of the following conditions shall have occurred: (A) a Manager Default shall have occurred and shall not have been remedied, waived or cured for a period of sixty (60) days after the earliest of (i) any Authorized Officer of the Issuer, the Manager or the Seller, as the case may be, first acquiring knowledge thereof, (ii) the Indenture Trustee’s giving written notice thereof to the Issuer, the Manager or the Seller, as the case may be, or (iii) any Noteholder giving written notice thereof to the Issuer, the Manager or the Seller, as the case may be, and the Indenture Trustee, (B) the Indenture Trustee (acting at the direction of the Requisite Global Majority) shall have directed the Issuer in writing, with a copy of such written direction delivered to the Manager (the “ Replacement Request ”), to appoint a Replacement Manager for the Terminated Containers in accordance with the terms of the Management Agreement, and (C) a Replacement Manager shall not have been appointed and assumed the management of all Terminated Containers pursuant to a management agreement reasonably acceptable to the Requisite Global Majority by the date which is sixty (60) days after the date on which such Manager Default initially occurred;
 
 
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(ix)           the Indenture Trustee shall fail to have a first priority perfected security interest in the Collateral (unless waived by the Requisite Global Majority);
 
(x)            as of any date of determination, the Aggregate Principal Balance shall exceed the sum of (A) the product of (i) one hundred percent (100%) and (ii) the Aggregate Asset Value, plus (B) the product of (i) one hundred percent (100%) and (ii) the then current balance on deposit in  the Restricted Cash Account;
 
(xi)           the Issuer is required to register as an Investment Company under the Investment Company Act of 1940, as amended;
 
(xii)         the occurrence of a reportable event (within the meaning of Section 4043 of ERISA) with respect to any Plan maintained by the Issuer as to which the Pension Benefit Guaranty Corporation has not by regulation waived the requirement that it be notified thereof, or the occurrence of any event or condition with respect to a Plan which reasonably could be expected to result in any liability (other than claims for benefits in the ordinary course of the Plan's operations) in excess of $250,000 or which actually results in the imposition of a Lien on the assets of the Issuer;
 
(xiii)         any event, or series of events, by which CAI shall own, directly or indirectly, less than seventy percent (70%) of the Capital Stock of CAL; or
 
(xiv)        any event, or series of events, by which CAL shall own, directly or indirectly, less than one hundred percent (100%) of the Capital Stock of the Issuer.
 
The occurrence of an Event of Default with respect to one Series of Notes, except to the extent waived in accordance with Section 813 hereof, shall constitute an Event of Default with respect to all other Series of Notes then Outstanding unless the related Supplement with respect to each such Series of Notes shall specifically provide to the contrary.
 
Section 802.                 Acceleration of Stated Maturity; Rescission and Annulment .
 
(a)     Upon the occurrence of an Event of Default of type described in paragraph (vi) or (vii) of Section 801, the unpaid principal balance of, and accrued interest on, all Series of Notes, together with all other amounts then due and owing to the Noteholders, each Series Enhancer and each Interest Rate Hedge Provider shall become immediately due and payable without further action by any Person.  If an Event of Default under Section 801 occurs and is continuing, then and in every such case the Indenture Trustee may, and shall at the direction of any of (A) any affected Noteholder in accordance with Section 808 or (B) the Requisite Global Majority in all other instances, declare the principal of and accrued interest on all Notes of all Series then Outstanding to be due and payable immediately, by a written notice to the Issuer and to the Indenture Trustee given by the Requisite Global Majority, and upon any such declaration such principal and accrued interest shall become immediately due and payable.
 
 
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(b)     At any time after such a declaration of acceleration has been made and before a judgment or decree for payment of the money due has been obtained by the Indenture Trustee as hereinafter in this Article provided, the Requisite Global Majority, by written notice to the Issuer and the Indenture Trustee, may rescind and annul such declaration and its consequences if:
 
(i)     the Issuer has paid or deposited with the Indenture Trustee a sum sufficient to pay:
 
(A)           all of the installments of interest and premium on and, if the Legal Final Maturity Date has occurred with respect to any Series, principal of all Notes of such Series which were overdue prior to the date of such acceleration;
 
(B)           to the extent that payment of such interest is lawful, interest at the applicable Overdue Rate on the amounts set forth in clause (A) above;
 
(C)           all sums paid or advanced by the Indenture Trustee hereunder or the Manager and the reasonable compensation, out-of-pocket expenses, disbursements and advances of the Indenture Trustee, its agents and counsel incurred in connection with the enforcement of this Indenture;
 
(D)           all scheduled payments due under any Interest Rate Hedge Agreement, together with interest thereon in accordance with the terms thereof, and
 
(ii)     all Events of Default, other than the nonpayment of the principal of or interest on Notes which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 813 hereof.
 
No such rescission with respect to any Event of Default shall affect any subsequent Event of Default or impair any right consequent thereon, nor shall any such rescission affect any Interest Rate Hedge Agreement which has been terminated in accordance with its terms.
 
Section 803.                  Collection of Indebtedness .
 
The Issuer covenants that, if an Event of Default occurs and is continuing and a declaration of acceleration has been made under Section 802 and not rescinded, the Issuer will, upon demand of the Indenture Trustee, pay to the Indenture Trustee, for the benefit of the Noteholders of all Series then Outstanding and each Interest Rate Hedge Provider, an amount equal to the sum of (i) the sum of (A) the whole amount then due and payable for all Series of Notes then Outstanding, (B) all amounts owing by the Issuer under any Interest Rate Hedge Agreement, and (C) such further amounts as shall be required to pay in full all of the Outstanding Obligations, including in each case, the costs and out-of-pocket expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Indenture Trustee and the Requisite Global Majority and their agents and counsel, incurred in connection with the enforcement of this Indenture, and (ii) to the extent that the payment of such interest is lawful, interest on the amount set forth in clause (i) at the applicable Overdue Rate with respect to the Notes and at the applicable default rate as set forth in the related Interest Rate Hedge Agreements or other Related Documents.
 
 
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Section 804.                 Remedies .
 
If an Event of Default shall occur and be continuing, the Indenture Trustee, by such officer or agent as it may appoint, shall notify each Noteholder, the Administrative Agent, each Interest Rate Hedge Provider and the applicable Rating Agencies, if any, and each Series Enhancer (if any) of such Event of Default.  So long as an Event of Default is continuing, the Indenture Trustee may, and shall if instructed by the Requisite Global Majority in each case:
 
(i)     institute any Proceedings, in its own name and as trustee of an express trust, for the collection of all amounts then due and payable on the Notes of all Series or under this Indenture or the related Supplement with respect thereto, whether by declaration or otherwise, enforce any judgment obtained, and collect from the Collateral and any other assets of the Issuer any monies adjudged due;
 
(ii)     subject to the quiet enjoyment rights of any lessee of a Managed Container, sell (including any sale made in accordance with Section 816 hereof), hold or lease the Collateral or any portion thereof or rights or interest therein, at one or more public or private transactions conducted in any manner permitted by law;
 
(iii)     institute any Proceedings from time to time for the complete or partial foreclosure of the Lien created by this Indenture with respect to the Collateral;
 
(iv)     institute such other appropriate Proceedings to protect and enforce any other rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy;
 
(v)     exercise any remedies of a secured party under the UCC or any Applicable Law and take any other appropriate action to protect and enforce the rights and remedies of the Indenture Trustee or the Noteholders hereunder;
 
(vi)     appoint a receiver or a manager over the Issuer or its assets; and
 
(vii)    if a Manager Default is then continuing, terminate the Management Agreement in accordance with its terms;
 
provided, however , that the prior consent of the Requisite Global Majority and each Interest Rate Hedge Provider shall be required in order to take the actions set forth in clause (ii) above.
 
 
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Section 805.                  Indenture Trustee May Enforce Claims Without Possession of Notes .
 
(a)       In all Proceedings brought by the Indenture Trustee (and also any Proceedings involving the interpretation of any provision of this Indenture to which the Indenture Trustee shall be a party), the Indenture Trustee shall be held to represent all of the Noteholders, and it shall not be necessary to make any Noteholder a party to any such Proceedings.
 
(b)      All rights of action and claims under this Indenture, the related Supplement or any of the Notes may be prosecuted and enforced by the Indenture Trustee without the possession of such Notes or the production thereof in any Proceeding relating thereto, and any such Proceeding instituted by the Indenture Trustee shall be brought in its own name as trustee of an express trust, and any recovery whether by judgment, settlement or otherwise shall, after provision for the payment of the reasonable compensation, expenses, and disbursements incurred and advances made, by the Indenture Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Notes, subject to the subordination of payments among Classes of a particular Series as set forth in the related Supplement.
 
Section 806.                 Allocation of Money Collected
 
.  If the Notes of all Series have been declared due and payable following an Event of Default and such declaration and its consequences have not been rescinded or annulled, any money collected by the Indenture Trustee pursuant to this Article or otherwise and any moneys that may then be held or thereafter received by the Indenture Trustee, shall be applied to the extent permitted by law in the following order, at the date or dates fixed by the Indenture Trustee:
 
FIRST:                         To the payment of all costs and expenses of collection incurred by the Indenture Trustee (including the reasonable fees and expenses of any counsel to the Indenture Trustee) and all other amounts due the Indenture Trustee, under Section 905 hereof; and
 
SECOND:                    Any remaining amounts shall be distributed in accordance with Section 302(c)(III) hereof.
 
Section 807.                 Limitation on Suits .
 
Except as permitted pursuant to Section 808 hereof, no Noteholder shall have the right to institute any Proceeding, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless:
 
(i)        such Holder has previously given written notice to the Indenture Trustee and the Requisite Global Majority of a continuing Event of Default;
 
(ii)          the Requisite Global Majority shall have made written request to the Indenture Trustee to institute Proceedings in respect of such Event of Default in its own name as Indenture Trustee hereunder;
 
 
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(iii)      such Holder or Holders have offered to the Indenture Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request;
 
(iv)      the Indenture Trustee has, for thirty (30) days after its receipt by a Corporate Trust Officer of such notice, request and offer of security or indemnity, failed to institute any such Proceeding; and
 
(v)        no direction inconsistent with such written request has been given to the Indenture Trustee during such thirty (30) day period by the Requisite Global Majority;
 
it being understood and intended that no one or more Noteholders shall have any right in any manner whatsoever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Noteholder, or to obtain or to seek to obtain priority or preference over any other Noteholder (except to the extent provided in the related Supplement) or to enforce any right under this Indenture, except in the manner herein provided and for the benefit of all Noteholders.
 
Section 808.                  Unconditional Right of Holders to Receive Principal, Interest and Commitment Fees .
 
Notwithstanding any other provision of this Indenture, each Noteholder shall have the right, which is absolute and unconditional, to receive payment of the principal of, and interest, commitment fees and premiums in respect of such Note as such principal, interest and commitment fees becomes due and payable in accordance with the provisions of this Indenture and the related Supplement and to institute any Proceeding for the enforcement of such payment, and such rights shall not be impaired without the consent of such Holder.
 
Section 809.                  Restoration of Rights and Remedies .
 
If the Indenture Trustee, any Holder has instituted any Proceeding to enforce any right or remedy under this Indenture or the related Supplement and such Proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Indenture Trustee, or to such Holder, then and in every such case, subject to any determination in such Proceeding, the Issuer, the Indenture Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Indenture Trustee and the Holders shall continue as though no such Proceeding had been instituted.
 
Section 810.                  Rights and Remedies Cumulative .
 
No right or remedy conferred upon or reserved to the Indenture Trustee, any Interest Rate Hedge Provider or to the Holders pursuant to this Indenture or any Supplement is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.
 
 
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Section 811.                  Delay or Omission Not Waiver .
 
No delay or omission of the Indenture Trustee, any Interest Rate Hedge Provider or any Holder of any Note to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.  Every right and remedy given by this Article or by law to the Indenture Trustee, any Interest Rate Hedge Provider, or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Indenture Trustee, by any Interest Rate Hedge Provider, or by the Holders, as the case may be.
 
Section 812.                  Control by Requisite Global Majority .
 
(a)        Upon the occurrence of an Event of Default, the Requisite Global Majority shall have the right to direct in writing the time, method and place of conducting any Proceeding for any remedy available to the Indenture Trustee or exercising any trust or power conferred on the Indenture Trustee, provided that (i) such direction shall not be in conflict with any rule of law or with this Indenture, including, without limitation, Section 804 hereof and (ii) the Indenture Trustee may take any other action deemed proper by the Indenture Trustee which is not inconsistent with such direction.
 
(b)       Notwithstanding the grant of a security interest to secure the Outstanding Obligations owing to the Indenture Trustee, for the benefit of the Noteholders and each Interest Rate Hedge Provider, all rights to direct actions or to exercise rights or remedies under this Indenture or the UCC (including those set forth in Section 804 hereof) shall be vested solely in the Requisite Global Majority and, by accepting the benefits of this Indenture, each Noteholder and Interest Rate Hedge Provider acknowledges such statement; provided , however , that nothing contained herein shall constitute a modification of Section 808, Section 813(b) or Section 816(d) hereof.
 
Section 813.                  Waiver of Past Defaults .
 
(a)       The Requisite Global Majority may, on behalf of all Noteholders of all Series, waive any past Event of Default and its consequences, except an Event of Default:
 
(i)             in the payment of (x) the principal balance of any Note on the Legal Final Maturity Date or (y) interest on any Note of any Series on any Payment Date, all of which defaults can be waived solely by the affected Noteholder, or
 
(ii)       in respect of a covenant or provision hereof which cannot be modified or amended without the consent of all the Noteholders of all Series pursuant to Section 1002 of this Indenture.
 
 
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(b)      Upon any such waiver, such Event of Default shall cease to exist and shall be deemed to have been cured and not to have occurred for every purpose of this Indenture; provided, however, that no such waiver shall extend to any subsequent or other Event of Default or impair any right consequent thereon nor affect any Interest Rate Hedge Agreement which has been terminated in accordance with its terms.
 
Section 814.                  Undertaking for Costs .
 
All parties to this Indenture agree, and each Holder of any Note by acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Indenture Trustee for any action taken, suffered or omitted by it as Indenture Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; provided, however, that the provisions of this Section shall not apply to any suit instituted by the Indenture Trustee or any Holder or group of Holders, holding in the aggregate more than ten percent (10%) of the aggregate principal balance of the Notes of all Series then Outstanding, or (ii) to any suit instituted by any Holder for the enforcement of (x) the payment of interest on any Notes on any Payment Date or (y) the payment of the principal of any Note on or after the Legal Final Maturity Date of such Note.
 
Section 815.                  Waiver of Stay or Extension Laws .
 
The Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Indenture Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.
 
Section 816.                  Sale of Collateral .
 
(a)       The power to effect any sale (a “Sale”) of any portion of the Collateral pursuant to Section 804 hereof shall not be exhausted by any one or more Sales as to any portion of the Collateral remaining unsold, but shall continue unimpaired until the entire Collateral shall have been sold or the Aggregate Outstanding Obligations shall have been paid in full.  The Indenture Trustee at the written direction of the Requisite Global Majority may from time to time postpone any Sale by public announcement made at the time and place of such Sale.
 
(b)       Upon any Sale, whether made under the power of sale hereby given or under judgment, order or decree in any Proceeding for the foreclosure or involving the enforcement of this Indenture:  (i) the Indenture Trustee, at the written direction of the Requisite Global Majority, may bid for and purchase the property being sold, and upon compliance with the terms of such Sale may hold, retain and possess and dispose of such property in accordance with the terms of this Indenture; and (ii) the receipt of the Indenture Trustee or of any officer thereof making such Sale shall be a sufficient discharge to the purchaser or purchasers at such Sale for its or their purchase money, and such purchaser or purchasers, and its or their assigns or personal representatives, shall not, after paying such purchase money and receiving such receipt of the Indenture Trustee or of such officer therefor, be obliged to see to the application of such purchase money or be in any way answerable for any loss, misappropriation or non-application thereof.
 
 
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(c)      The Indenture Trustee shall execute and deliver an appropriate instrument of conveyance provided to it transferring its interest in any portion of the Collateral in connection with a Sale thereof.  In addition, the Indenture Trustee is hereby irrevocably appointed the agent and attorney-in-fact of the Issuer to transfer and convey its interest (subject to lessee’s rights of quiet enjoyment) in any portion of the Collateral in connection with a Sale thereof, and to take all action necessary to effect such Sale.  No purchaser or transferee at such a Sale shall be bound to ascertain the Indenture Trustee’s authority, inquire into the satisfaction of any conditions precedent or see to the application of any monies.
 
(d)      The right of the Indenture Trustee to sell, transfer or otherwise convey any Interest Rate Hedge Agreement or any transaction outstanding thereunder, or to exercise foreclosure rights with respect thereto shall be subject to compliance with the provisions of the applicable Interest Rate Hedge Agreement.
 
Section 817.                  Action on Notes .
 
The Indenture Trustee’s right to seek and recover judgment on the Notes under this Indenture or any Supplement shall not be affected by the seeking, obtaining or application of any other relief under or with respect to this Indenture or any Supplement.  Neither the Lien of this Indenture nor any rights or remedies of the Indenture Trustee, any Interest Rate Hedge Provider or the Noteholders shall be impaired by the recovery of any judgment by the Indenture Trustee against the Issuer or by the levy of any execution under such judgment upon any portion of the Collateral or upon any of the assets of the Issuer.
 
ARTICLE IX
 
CONCERNING THE INDENTURE TRUSTEE
 
Section 901.                  Duties of Indenture Trustee .
 
The Indenture Trustee, prior to the occurrence of an Event of Default with respect to any Series or after the cure or waiver of any Event of Default with respect to any Series which may have occurred, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and the related Supplement and no duties shall be inferred or implied.  If an Event of Default with respect to any Series has occurred and is continuing, the Indenture Trustee, at the written direction of the Requisite Global Majority, shall exercise such of the rights and powers vested in it by this Indenture and the related Supplement, and use the same degree of care and skill in its exercise as a prudent Person would exercise or use under the circumstances in the conduct of such Person’s own affairs.
 
 
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The Indenture Trustee, upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to the Indenture Trustee which are specifically required to be furnished pursuant to any provisions of this Indenture and any applicable Supplement, shall determine whether they are substantially in the form required by this Indenture and any applicable Supplement; provided, however, that the Indenture Trustee shall not be responsible for the accuracy or content of any such resolution, certificate, statement, opinion, report, document, order or other instrument furnished pursuant to this Indenture and any applicable   Supplement.
 
No provision of this Indenture or any Supplement shall be construed to relieve the Indenture Trustee from liability for its own negligent action, its own negligent failure to act or its own willful misconduct; provided, however, that:
 
(i)       Prior to the occurrence of an Event of Default and after the cure or waiver of any Event of Default which may have occurred, the duties and obligations of the Indenture Trustee shall be determined solely by the express provisions of this Indenture and any   Supplements issued pursuant to the terms hereof. The Indenture Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture and any Supplements issued pursuant to the terms hereof, and no implied covenants or obligations shall be read into this Indenture against the Indenture Trustee and, in the absence of bad faith on the part of the Indenture Trustee, the Indenture Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates, statements, reports, documents, orders, opinions or other instruments (whether in their original or facsimile form) furnished to the Indenture Trustee and conforming to the requirements of this Indenture and any Supplements issued pursuant to the terms hereof;
 
(ii)      The Indenture Trustee shall not be liable for an error of judgment made in good faith by a Corporate Trust Officer or Corporate Trust Officers, unless it shall be proved that the Indenture Trustee was negligent in ascertaining the pertinent facts; and
 
(iii)      The Indenture Trustee shall not be personally liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of the Requisite Global Majority relating to the time, method and place of conducting any Proceeding for any remedy available to the Indenture Trustee, or exercising any trust or power conferred upon the Indenture Trustee, under this Indenture.
 
No provision of this Indenture shall require the Indenture Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate security or indemnity against such risk or liability is not reasonably assured to it.
 
 
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Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Indenture Trustee shall be subject to the provisions of this Section 901.
 
Section 902.                  Certain Matters Affecting the Indenture Trustee .
 
Except as otherwise provided in Section 901 hereof:
 
(i)       The Indenture Trustee may conclusively rely and shall be fully protected in acting or refraining from acting upon any Opinion of Counsel, certificate of an officer of the Issuer or the Manager, certificate of auditors or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, appraisal, bond or other paper or document (whether in its original or facsimile form) believed by it to be genuine and to have been signed or presented by the proper party or parties;
 
(ii)      The Indenture Trustee may consult with counsel of its selection and any advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by it hereunder in good faith and in accordance in reliance thereof;
 
(iii)          The Indenture Trustee shall be under no obligation to institute, conduct or defend any litigation or Proceeding hereunder or in relation hereto at the request, order or direction of the Requisite Global Majority, pursuant to the provisions of this Indenture, unless the Indenture Trustee shall have reasonable grounds for believing that it has security or indemnity reasonably satisfactory to it against the costs, expenses and liabilities which may be incurred therein or thereby;
 
(iv)      The Indenture Trustee shall not be liable for any action taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture;
 
(v)      The Indenture Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond or other paper or document, unless requested in writing to do so by the Requisite Global Majority; provided , however, that the Indenture Trustee may require reasonable security or indemnity satisfactory to it against any cost, expense or liability likely to be incurred in making such investigation as a condition to so proceeding.  The expense of any such examination shall be paid, on a pro rata basis, by the Noteholders of the applicable Series requesting such examination or, if paid by the Indenture Trustee, shall be reimbursed by such Noteholders upon demand;
 
(vi)      The Indenture Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through its agents or attorneys, and the Indenture Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed by it with due care hereunder;
 
 
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(vii)     The Indenture Trustee shall not be charged with knowledge of any Event of Default unless either a Corporate Trust Officer shall have actual knowledge or written notice of such shall have been given to a Corporate Trust Officer of the Indenture Trustee; and
 
(viii)     The rights, privileges, protections, immunities and benefits given to the Indenture Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Indenture Trustee in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder.
 
The provisions of this Section 902 shall be applicable to the Indenture Trustee in its capacity as Indenture Trustee under this Indenture.
 
Section 903.                  Indenture Trustee Not Liable .
 
(a)       The recitals contained herein (other than the representations and warranties contained in Section 911 hereof), in any Supplement and in the Notes (other than the certificate of authentication on the Notes) shall be taken as the statements of the Issuer, and the Indenture Trustee assumes no responsibility for their correctness.  The Indenture Trustee makes no representations as to the validity or sufficiency of this Indenture, any Supplement, the Notes, the Collateral or of any Related Document.  The Indenture Trustee shall not be accountable for (i) the use or application by the Issuer of the proceeds of any Series or Class of Notes, and (ii) the use or application of any funds paid to the Issuer or the Manager in respect of the Collateral except for any payment in accordance with the Manager Report of amounts on deposit in any of the Trust Accounts.
 
(b)      The Indenture Trustee shall have no responsibility or liability for or with respect to the existence or validity of any Managed Container, the perfection of any security interest (whether as of the date hereof or at any future time), the maintenance of or the taking of any action to maintain such perfection, the validity of the assignment of any portion of the Collateral to the Indenture Trustee or of any intervening assignment, the compliance by the Seller or the Manager with any covenant or the breach by the Seller or the Manager of any warranty or representation made hereunder, in any Supplement or in any Related Document or the accuracy of such warranty or representation, any investment of monies in the Trust Account, the Restricted Cash Account, each Pre-Funding Account or any Series Account or any loss resulting therefrom ( provided that such investments are made in accordance with the provisions of Section 303 hereof), or the acts or omissions of the Seller or the Manager taken in the name of the Indenture Trustee.
 
(c)      The Indenture Trustee shall not have any obligation or liability under any Contract by reason of or arising out of this Indenture or the granting of a security interest in such Contract hereunder or the receipt by the Indenture Trustee of any payment relating to any Contract pursuant hereto, nor shall the Indenture Trustee be required or obligated in any manner to perform or fulfill any of the obligations of the Issuer, the Seller or the Manager under or pursuant to any Contract, or to make any payment, or to make any inquiry as to the nature or the sufficiency of any payment received by it, or the sufficiency of any performance by any party, under any Contract.
 
 
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Section 904.                  Indenture Trustee May Own Notes .
 
The Indenture Trustee in its individual or any other capacity may become the owner or pledgee of Notes with the same rights it would have if it were not Indenture Trustee; provided that such transaction shall not result in the disqualification of the Indenture Trustee for purposes of Rule 3a-7 under the Investment Company Act of 1940.
 
Section 905.                  Indenture Trustee’s Fees, Expenses and Indemnities .
 
(a)       The Indenture Trustee Fees and Indenture Trustee Indemnified Amounts shall be paid by the Issuer in accordance with Sections 302 or 806 hereof.  The Issuer shall indemnify the Indenture Trustee (and any predecessor Indenture Trustee) and each of its officers, directors and employees for, and hold them harmless against, any and all loss, liability, damage claim or expense incurred without negligence or willful misconduct on their part, arising out of or in connection with the acceptance or administration of this trust, including the costs and expenses of defending itself both individually and in its representative capacity against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder (the “Indenture Trustee Indemnified Amounts”).
 
(b)      The obligations of the Issuer under this Section 905 to compensate the Indenture Trustee, to pay or reimburse the Indenture Trustee for expenses, disbursements and advances and to indemnify and hold harmless the Indenture Trustee, shall constitute Outstanding Obligations hereunder and shall survive the resignation or removal of the Indenture Trustee and the satisfaction and discharge of this Indenture.
 
(c)      When the Indenture Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 801(vi) or Section 801(vii), the expenses and the compensation for the services are intended to constitute expenses of administration under Insolvency Law.
 
Section 906.                  Eligibility Requirements for Indenture Trustee .
 
The Indenture Trustee hereunder shall at all times be a national banking association or a corporation, organized and doing business under the laws of the United States of America or any State, and authorized under such laws to exercise corporate trust powers.  In addition, the Indenture Trustee or its parent corporation shall at all times (i) have a combined capital and surplus of at least Two Hundred Fifty Million Dollars ($250,000,000), (ii) be subject to supervision or examination by Federal or state authority and (iii) have a long-term unsecured senior debt rating of “A2” or better by Moody’s and a long-term unsecured senior debt rating of “A” by Standard & Poor’s and short-term unsecured senior debt rating of “P-1” or better by Moody’s and a short-term unsecured senior debt rating of “A-2” by Standard & Poor’s.  If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of such supervising or examining authority, then, for the purposes of this Section 906, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  In case at any time the Indenture Trustee shall cease to be eligible in accordance with the provisions of this Section, the Indenture Trustee shall resign immediately in the manner and with the effect specified in Section 907 hereof.
 
 
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Section 907.                  Resignation and Removal of Indenture Trustee .
 
The Indenture Trustee may at any time resign and be discharged from the trusts hereby created by giving written notice thereof to the Issuer, the Manager, the Administrative Agent, each Interest Rate Hedge Provider and the Noteholders.  The Indenture Trustee may also be removed by the Issuer for any reason so long as no Default or Event of Default is occurring, provided that the Manager and the Requisite Global Majority agree to such removal, and such removal will not be effective until upon the acceptance by a successor Indenture Trustee of its appointment in accordance with the terms herein. Upon receiving such notice of resignation, the Issuer at the direction and subject to the consent of the Requisite Global Majority shall promptly appoint a successor Indenture Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the resigning Indenture Trustee, the Administrative Agent, each Interest Rate Hedge Provider and one copy to the successor Indenture Trustee.  If no successor Indenture Trustee shall have been so appointed by the Issuer or the proposed successor Indenture Trustee has not accepted its appointment within thirty (30) days after the giving of such notice of resignation or removal, the Requisite Global Majority may appoint a successor trustee or, if it does not do so within thirty (30) days thereafter, the resigning Indenture Trustee, with the consent of the Administrative Agent, may petition at the expense of the Issuer any court of competent jurisdiction for the appointment of a successor Indenture Trustee, which successor trustee shall meet the eligibility standards set forth in Section 906.
 
If at any time the Indenture Trustee shall cease to be eligible in accordance with the provisions of Section 906 hereof and shall fail to resign after written request therefor by the Issuer at the direction of the Requisite Global Majority or the Administrative Agent, or if at any time the Indenture Trustee shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or a receiver of the Indenture Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Indenture Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then the Issuer at the direction of the Requisite Global Majority shall remove the Indenture Trustee and appoint a successor Indenture Trustee within sixty (60) days thereafter by written instrument, in duplicate, one copy of which instrument shall be delivered to the Indenture Trustee so removed and one copy to the successor Indenture Trustee.
 
Any resignation or removal of the Indenture Trustee and appointment of a successor Indenture Trustee pursuant to any of the provisions of this Section shall become effective upon acceptance of appointment by the successor Indenture Trustee as provided in Section 908 hereof.
 
 
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Section 908.                  Successor Indenture Trustee .
 
Any successor Indenture Trustee appointed as provided in Section 907 hereof shall execute, acknowledge and deliver to the Issuer and to its predecessor Indenture Trustee an instrument accepting such appointment hereunder, and thereupon the resignation or removal of the predecessor Indenture Trustee shall become effective and such successor Indenture Trustee, without any further act, deed or conveyance, shall become fully vested with all the rights, powers, duties and obligations of its predecessor hereunder, with like effect as if originally named as Indenture Trustee herein.  The predecessor Indenture Trustee shall deliver to the successor Indenture Trustee all documents relating to the Collateral, if any, delivered to it, together with any amount remaining in the Trust Account, Restricted Cash Account, each Pre-Funding Account and any other Series Accounts.  In addition, the predecessor Indenture Trustee and, upon request of the successor Indenture Trustee, the Issuer shall execute and deliver such instruments and do such other things as may reasonably be required for more fully and certainly vesting and confirming in the successor Indenture Trustee all such rights, powers, duties and obligations.
 
No successor Indenture Trustee shall accept appointment as provided in this Section unless at the time of such acceptance such successor Indenture Trustee shall be eligible under the provisions of Section 906 hereof and shall be acceptable to the Requisite Global Majority and each Interest Rate Hedge Provider.
 
Upon acceptance of appointment by a successor Indenture Trustee as provided in this Section, the Issuer shall mail notice of the succession of such Indenture Trustee hereunder to all Noteholders at their addresses as shown in the registration books maintained by the Indenture Trustee and to each Interest Rate Hedge Provider.  If the Issuer fails to mail such notice within ten (10) days after acceptance of appointment by the successor Indenture Trustee, the successor Indenture Trustee shall cause such notice to be mailed at the expense of the Issuer.
 
Section 909.                  Merger or Consolidation of Indenture Trustee .
 
Any corporation into which the Indenture Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Indenture Trustee shall be a party, or any corporation succeeding to all or substantially all of the business of the Indenture Trustee, shall be the successor of the Indenture Trustee hereunder, provided such corporation shall be eligible under the provisions of Section 906 hereof, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding.
 
 
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Section 910.                  Separate Indenture Trustees, Co-Indenture Trustees and Custodians .
 
If the Indenture Trustee is not capable of acting outside the United States or of exercising trust powers within the United States, it shall have the power from time to time to appoint (subject to the prior approval of the Rating Agencies, or, if any Series of Notes is not then rated, the Administrative Agent) one or more Persons or corporations to act either as co-trustees jointly with the Indenture Trustee, or as separate trustees, or as custodians, for the purpose of holding title to, foreclosing or otherwise taking action with respect to any of the Collateral, when such separate trustee or co-trustee is necessary or advisable under any Applicable Laws or for the purpose of otherwise conforming to any legal requirement, restriction or condition in any applicable jurisdiction.  The separate trustees, co-trustees, or custodians so appointed shall be trustees, co-trustees, or custodians for the benefit of all Noteholders and shall have such powers, rights and remedies as shall be specified in the instrument of appointment; provided, however, that no such appointment shall, or shall be deemed to, constitute the appointee an agent of the Indenture Trustee.  The Issuer shall join in any such appointment, but such joining shall not be necessary for the effectiveness of such appointment.
 
Every separate trustee, co-trustee and custodian shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions:
 
(i)        all powers, duties, obligations and rights conferred upon the Indenture Trustee in respect of the receipt, custody and payment of moneys shall be exercised solely by the Indenture Trustee;
 
(ii)       all other rights, powers, duties and obligations conferred or imposed upon the Indenture Trustee shall be conferred or imposed upon and exercised or performed by the Indenture Trustee and such separate trustee, co-trustee, or custodian jointly, except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed the Indenture Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding of title to the Collateral or any portion thereof in any such jurisdiction) shall be exercised and performed by such separate trustee, co-trustee or custodian;
 
(iii)       the Indenture Trustee shall not be personally liable for any act or omission of any separate trustee, co-trustee or custodian appointed by the Indenture Trustee; and
 
(iv)       the Issuer or the Indenture Trustee may at any time accept the resignation of or remove any separate trustee, co-trustee or custodian so appointed by it or them if such resignation or removal does not violate the other terms of this Indenture.
 
Any notice, request or other writing given to the Indenture Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them.  Every instrument appointing any separate trustee, co-trustee, or custodian shall refer to this Indenture and the conditions of this Article.  Each separate trustee and co-trustee, upon its acceptance of the trusts conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Indenture Trustee or separately, as may be provided therein, subject to all the provisions of this Indenture, specifically including every provision of this Indenture relating to the conduct of, affecting the liability of, or affording protection to, the Indenture Trustee.  Every such instrument shall be furnished to the Indenture Trustee and each Interest Rate Hedge Provider.
 
 
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Any separate trustee, co-trustees, or custodian may, at any time, constitute the Indenture Trustee, its agent or attorney-in-fact, with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Indenture on its behalf and in its name.  If any separate trustee, co-trustee, or custodian shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Indenture Trustee, to the extent permitted by law, without the appointment of a new or successor trustee or custodian.
 
No separate trustee, co-trustee or custodian hereunder shall be required to meet the terms of eligibility as a successor Indenture Trustee under Section 906 hereof and no notice to Noteholders of the appointment thereof shall be required under Section 908 hereof.
 
The Indenture Trustee agrees to instruct the co-trustees, if any, to the extent necessary to fulfill the Indenture Trustee’s obligations hereunder.
 
Section 911.                  Representations and Warranties .
 
The Indenture Trustee hereby represents and warrants as of each Series Issuance Date that:
 
(a)       Organization and Good Standing .  The Indenture Trustee is a national banking association duly organized, validly existing and in good standing under the laws of the United States, and has the power to own its assets and to transact the business in which it is presently engaged;
 
(b)           Authorization .  The Indenture Trustee has the power, authority and legal right to execute, deliver and perform this Indenture and each Supplement and to authenticate the Notes, and the execution, delivery and performance of this Indenture and each Supplement and the authentication of the Notes has been duly authorized by the Indenture Trustee by all necessary corporate action;
 
(c)      Binding Obligations .  This Indenture and each Supplement, assuming due authorization, execution and delivery by the Issuer, constitutes the legal, valid and binding obligations of the Indenture Trustee, enforceable against the Indenture Trustee in accordance with its terms, except that (i) such enforcement may be subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws (whether statutory, regulatory or decisional) now or hereafter in effect relating to creditors’ rights generally and the rights of trust companies in particular and (ii) the remedy of specific performance and injunctive and other forms of equitable relief may be subject to certain equitable defenses and to the discretion of the court before which any Proceeding therefor may be brought, whether in a Proceeding at law or in equity;
 
(d)       No Violation .  The performance by the Indenture Trustee of its obligations under this Indenture and each Supplement will not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice, lapse of time or both) a default under, the charter documents or bylaws of the Indenture Trustee;
 
 
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(e)      No Proceedings .  There are no Proceedings or investigations to which the Indenture Trustee is a party pending, or, to the best of its knowledge without independent investigation, threatened, before any court, regulatory body, administrative agency or other tribunal or Governmental Authority (A) asserting the invalidity of this Indenture or the Notes, (B) seeking to prevent the issuance of the Notes or the consummation of any of the transactions contemplated by this Indenture or (C) seeking any determination or ruling that would materially and adversely affect the performance by the Indenture Trustee of its obligations under, or the validity or enforceability of, this Indenture or the Notes; and
 
(f)       Approvals .  Neither the execution or delivery by the Indenture Trustee of this Indenture nor the consummation of the transactions by the Indenture Trustee contemplated hereby requires the consent or approval of, the giving of notice to, the registration with or the taking of any other action   with respect to any Governmental Authority under any existing federal or State of Minnesota law governing the banking or trust powers of the Indenture Trustee.
 
Section 912.                  Indenture Trustee Offices .
 
The Indenture Trustee shall maintain in the State of Minnesota an office or offices or agency or agencies where Notes may be surrendered for registration of transfer or exchange, which office is currently located at the Corporate Trust Office, and shall promptly notify the Issuer, the Manager, each Interest Rate Hedge Provider and the Noteholders of any change of such location.
 
Section 913.                  Notice of Event of Default .
 
If a Corporate Trust Officer shall have actual knowledge that an Event of Default with respect to any Series has occurred and be continuing, the Indenture Trustee shall promptly (but in any event within five (5) Business Days) give written notice thereof to the Noteholders, any Rating Agency, the Administrative Agent and each Interest Rate Hedge Provider.  For all purposes of this Indenture, in the absence of actual knowledge by a Corporate Trust Officer, the Indenture Trustee shall not be deemed to have actual knowledge of any Event of Default unless notified in writing thereof by the Issuer, the Seller, the Manager, the Administrative Agent or any Noteholder, and such notice references the applicable Series of Notes generally, the Issuer, this Indenture or the applicable Supplement.
 
 
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ARTICLE X
 
SUPPLEMENTAL INDENTURES
 
Section 1001.                Supplemental Indentures Not Creating a New Series Without Consent of Holders .
 
(a)       Without the consent of any Holder and based on an Opinion of Counsel in form and substance reasonably acceptable to the Indenture Trustee to the effect that such Supplement is for one of the purposes set forth in clauses (i) through (vii) below, the Issuer and the Indenture Trustee, at any time and from time to time, may, enter into one or more Supplements in form satisfactory to the Indenture Trustee, for any of the following purposes:
 
(i)       to add to the covenants of the Issuer in this Indenture for the benefit of the Holders of all Series then Outstanding, or to surrender any right or power conferred upon the Issuer in this Indenture;
 
(ii)       to cure any ambiguity, to correct or supplement any provision in this Indenture which may be inconsistent with any other provision in this Indenture, or to make any other provisions with respect to matters or questions arising under this Indenture;
 
(iii)      to correct or amplify the description of any property at any time subject to the Lien of this Indenture, or better to assure, convey and confirm unto the Indenture Trustee any property subject or required to be subjected to the Lien of this Indenture, or to subject additional property to the Lien of this Indenture;
 
(iv)      to add to the conditions, limitations and restrictions on the authorized amount, terms and purposes of issue, authentication and delivery of the Notes, as herein set forth, or additional conditions, limitations and restrictions thereafter to be observed by the Issuer;
 
(v)       to convey, transfer, assign, mortgage or pledge any additional property to or with the Indenture Trustee;
 
(vi)      to evidence the succession of the Indenture Trustee pursuant to Article IX; or
 
(vii)      to add any additional Early Amortization Events or Events of Default.
 
Prior to the execution of any Supplement issued pursuant to this Section 1001, the Issuer shall provide written notice to each Rating Agency setting forth in general terms the substance of any such Supplement.
 
(b)      Promptly after the execution by the Issuer and the Indenture Trustee of any Supplement pursuant to this Section, the Issuer shall mail to the Holders of all Notes then Outstanding, each Rating Agency, the Administrative Agent and each Interest Rate Hedge Provider, a notice setting forth in general terms the substance of such Supplement, together with a copy of the text of such Supplement.  Any failure of the Issuer to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such Supplement.
 
 
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Section 1002.                Supplemental Indentures Not Creating a New Series with Consent of Holders .
 
(a)       With the consent of the Requisite Global Majority, the Issuer and the Indenture Trustee may enter into a Supplement hereto for the purpose of adding any provisions to or changing in any manner or eliminating or waiving any of the provisions of this Indenture or of modifying in any manner the rights of the Holders under this Indenture (other than any such additions, changes, eliminations or modifications described in Section 1001); provided, however, that no such Supplement shall, without the consent of the Holder of each Outstanding Note affected thereby:
 
(i)       reduce the principal amount of any Note or the rate of interest thereon, change the priority of any such payments (other than to increase the priority thereof) required pursuant to this Indenture or any Supplement in a manner adverse to any Noteholder, or the date on which, or the amount of which, or the place of payment where, or the coin or currency in which, any Note or the interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Expected Final Maturity Date thereof,
 
(ii)       reduce the percentage of Outstanding Notes or Existing Commitments required for (a) the consent of any Supplement to this Indenture, (b) the consent required for any waiver of compliance with certain provisions of this Indenture or certain Events of Default hereunder and their consequences as provided for in this Indenture or (c) the consent required to waive any payment default on the Notes;
 
(iii)      modify any provision of this Indenture or any Supplement which specifies that such provision cannot be modified or waived without the consent of the Holder of each Outstanding Note affected thereby;
 
(iv)      modify or alter the definition of the terms “Outstanding”, “Requisite Global Majority”, “Existing Commitment” or “Initial Commitment”;
 
(v)       impair or adversely affect the Collateral in any material respect as a whole except as otherwise permitted herein;
 
(vi)      modify or alter Section 702(a) of this Indenture; or
 
(vii)      permit the creation of any Lien ranking prior to or on a parity with the Lien of this Indenture with respect to any part of the Collateral or terminate the Lien of this Indenture on any property at any time subject hereto or deprive the Holder of any Note of the security afforded by the Lien of this Indenture.
 
 
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This Indenture may not be amended, modified or supplemented pursuant to this Section 1002 without the prior written consent of each Interest Rate Hedge Provider with respect to any of the following matters: (i) any amendments, modification or supplements to any sections in the Indenture granting rights or benefits with respect to Interest Rate Hedge Agreements and Interest Rate Hedge Providers if the effect of any such amendment, modification or waiver is to modify in a manner adverse to such Interest Rate Hedge Provider such rights or benefits, including but not limited to Sections 101, 302, 606, 801 or this Section 1002, (ii) any amendments, modifications or supplements which would adversely affect or deprive the Interest Rate Hedge Provider of any rights expressly granted to it under this Indenture (e.g., the right to receive notice, to be secured by the Collateral, have certain payment priorities in the “waterfall” order of payments set out in Section 302 and to consent to certain amendments) or to subordinate any payment priority attributed to such Interest Rate Hedge Provider; (iii) impair the Collateral or permit any Liens to be imposed on the Collateral, each as described in clauses (v) and (vii) of Section 1002(a) respectively or (iv) waive an Event of Default if, at the time of such waiver, the Interest Rate Hedge Agreement has been previously terminated and the Interest Rate Hedge Provider is owed any termination payments on account thereof.  An increase in the interest rate payable to any Noteholder on its Note shall not, in and of itself, violate the provisions of clauses (i) or (ii) above.
 
Prior to the execution of any Supplement issued pursuant to this Section 1002, the Issuer shall provide written notice to each Rating Agency, each Interest Rate Hedge Provider and each Series Enhancer setting forth in general terms the substance of any such Supplement.
 
(b)      Promptly after the execution by the Issuer and the Indenture Trustee of any Supplement pursuant to this Section, the Issuer shall mail to the Holders of the Notes, each Rating Agency, the Administrative Agent and each Interest Rate Hedge Provider, a notice setting forth in general terms the substance of such Supplement, together with a copy of the text of such Supplement.  Any failure of the Issuer to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such Supplement.
 
Section 1003.                Execution of Supplemental Indentures .
 
In executing, or accepting the additional trusts created by, a Supplement permitted by this Article or the modification thereby of the trusts created by this Indenture, the Indenture Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such Supplement is authorized or permitted by this Indenture.  The Indenture Trustee may, but shall not be obligated to, enter into any such Supplement which affects the Indenture Trustee’s own rights, duties or immunities under this Indenture or otherwise.
 
Section 1004.                Effect of Supplemental Indentures .
 
Upon the execution of any Supplement under this Article, this Indenture shall be modified in accordance therewith, and such Supplement shall form a part of this Indenture for all purposes, and every Holder of Notes theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.
 
 
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Section 1005.                Reference in Notes to Supplemental Indentures .
 
Notes authenticated and delivered after the execution of any Supplement pursuant to this Article may, and shall if required by the Issuer, bear a notation as to any matter provided for in such Supplement.  If the Issuer shall so determine, new Notes so modified as to conform, in the opinion of the Indenture Trustee, may be prepared and executed by the Issuer and authenticated and delivered by the Indenture Trustee in exchange for Outstanding Notes.
 
Section 1006.                Issuance of Series of Notes .
 
(a)      The Issuer may from time to time issue one or more Series of Notes pursuant to the terms of the Indenture as long as (i) each Rating Agency that has issued a rating with respect to any other existing Series then Outstanding shall have confirmed, in writing, to the Indenture Trustee and each Series Enhancer (if any) that the rating(s) on such existing Series will not be downgraded or withdrawn as the result of the issuance of such additional Series, (ii) no Event of Default or Early Amortization Event, or event or condition which with the passage of time or giving of notice or both would become an Event of Default or Early Amortization Event is then continuing (or would occur as a result of the issuance of such additional Series) and (iii) all of the other applicable conditions set forth in the Indenture have been satisfied.
 
(b)      On or before the Series Issuance Date relating to any Series, the parties hereto will execute and deliver a Supplement which will specify the Principal Terms of such Series.  The terms of such Supplement may modify or amend the terms of this Indenture solely as applied to such Series, and, with the consent of the Control Party for any other Series and each affected Interest Rate Hedge Provider, may amend this Indenture as applicable to such other Series, in accordance with Section 1001 or 1002 hereof. The obligation of the Indenture Trustee to authenticate, execute and deliver the Notes of such additional Series and to execute and deliver the related Supplement is subject to the satisfaction of the following conditions:
 
(i)       on or before the tenth (10 th ) Business Day immediately preceding the Series Issuance Date (unless the parties to be notified agree to a shorter notice period), the Issuer shall have given the Indenture Trustee, the Manager, each Rating Agency (and, if such additional Series is to be registered pursuant to the Securities Act, all Rating Agencies that have rated any prior Series), the Administrative Agent and each Interest Rate Hedge Provider entitled thereto pursuant to the relevant Supplement notice of the Series and the Series Issuance Date;
 
(ii)       the Issuer shall have delivered to the Indenture Trustee the related Supplement, executed by each party hereto other than the Indenture Trustee;
 
(iii)      the Rating Agency Condition shall have been satisfied with respect to the issuance of such additional Series;
 
(iv)      the Issuer shall have delivered to the Indenture Trustee, each Rating Agency, each Interest Rate Hedge Provider and, if required, any Noteholder, any Opinions of Counsel required by the related Supplement, including without limitation with respect to true sale, enforceability, non-consolidation and security interest perfection issues;
 
 
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(v)       the Issuer shall have delivered to the Indenture Trustee an Officer’s Certificate stating that no Early Amortization Event or Event of Default (or event or condition which with the passage of time or giving of notice or both would become an Early Amortization Event or an Event of Default) has occurred and is then continuing (or would result from the issuance of such additional Series);
 
(vi)      no additional Series of Notes shall have a Legal Final Maturity Date that is earlier than the Legal Final Maturity Date for any Series of Notes then Outstanding (immediately prior to the issuance of such additional Series);
 
(vii)      written confirmation from an officer of the Manager that after giving effect to such proposed issuance, the aggregate unpaid principal balance of all Series of Notes then Outstanding does not exceed the Asset Base, as evidenced by the Asset Base Report most recently received by the Indenture Trustee (but not earlier than the preceding Payment Date);
 
(viii)      such other conditions as shall be specified in the related Supplement; and
 
(ix)      the Issuer shall have delivered to the Indenture Trustee an Officer’s Certificate that all of the conditions specified in clauses (i) through (viii) have been satisfied.
 
The provisions of clauses (i), (iii) and (vi) above shall not apply to the issuance of the initial Series of Notes issued pursuant to this Indenture.
 
Upon satisfaction of the above conditions, the Indenture Trustee shall execute the Supplement and authenticate, execute and deliver the Notes of such Series.
 
Section 1007.                Amendments to Intercreditor Collateral Agreement .
 
The Indenture Trustee is hereby authorized to enter into amendments to the Intercreditor Collateral Agreement permitted pursuant to Section 631.
 
 
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ARTICLE XI
 
HOLDERS LISTS
 
Section 1101.                Indenture Trustee to Furnish Names and Addresses of Holders
 
.  Unless otherwise provided in the related Supplement, the Indenture Trustee will furnish or cause to be furnished to the Manager not more than ten (10) days after receipt of a request, a list, in such form as the Indenture Trustee generally maintains, of the names, addresses and tax identification numbers of the Holders of Notes as of such date.
 
Section 1102.               Preservation of Information; Communications to Holders
 
.  The Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders contained in the most recent list furnished to the Indenture Trustee as provided in Section 1101 and the names and addresses of Holders received by the Indenture Trustee in its capacity as Note Registrar.  The Indenture Trustee may destroy any list furnished to it as provided in Section 1101 upon receipt of a new list so furnished.
 
ARTICLE XII
 
EARLY AMORTIZATION EVENT
 
Section 1201.                Early Amortization Event .
 
As of any date of determination, the existence of any one of the following events or conditions:
 
(1)        An Event of Default or a Manager Default shall have occurred and then be continuing;
 
(2)        The Manager Report delivered for any Payment Date indicates that an Asset Base Deficiency exists;
 
(3)        The Manager Report delivered for any Payment Date indicates that the EBIT Ratio of the Issuer is less than 1.10:1.00;
 
(4)        The Manager Report delivered for any Payment Date indicates that the Weighted Average Age of the Eligible Container is greater than nine (9) years;
 
(5)        (A) A breach of any financial covenant of CAI or CAL set forth in the documents governing any Indebtedness of CAI and/or its Subsidiaries (the “Funded Debt Documents”) in excess of $20,000,000 shall have occurred for such period of time as would permit (assuming the giving of appropriate notice if required) the holder or holders thereof or of any obligations issued thereunder to accelerate the maturity of all or part of such Indebtedness, or any such holder or holders shall rescind or shall have a right to rescind the purchase of any such obligations, or (B) any default, not described in clause (A), under any Funded Debt Document shall have occurred and as a result the required lenders under the affected financing transaction have accelerated all or part of such Indebtedness; or
 
 
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(6)        An event or condition designated as an Early Amortization Event in any Supplement shall have occurred and then be continuing.
 
If the Early Amortization Event described in clause (2) above has occurred, such Early Amortization Event shall be deemed no longer continuing if the Asset Base Deficiency is cured within thirty (30) days after the Payment Date on which such Asset Base Deficiency initially occurred; provided , that, no more than one cure of such event can occur during any two year period.
 
If the Early Amortization Event described in clause (6) above has occurred, such Early Amortization Event shall be deemed no longer continuing immediately upon the waiver and/or cure of such Early Amortization Event in accordance with the terms of the applicable Supplement.
 
Except as set forth in the immediately preceding paragraph, an Early Amortization Event shall be deemed to continue until the Business Day on which the Requisite Global Majority waives, in writing, such Early Amortization Event.  The Indenture Trustee shall promptly provide notice of any such waiver to each Rating Agency.
 
ARTICLE XIII
 
MISCELLANEOUS PROVISIONS
 
Section 1301.                Compliance Certificates and Opinions .
 
(a)       Upon any application or request by the Issuer to the Indenture Trustee to take any action under any provision of this Indenture or any Supplement, the Issuer shall furnish to the Indenture Trustee a certificate stating that all conditions precedent, if any, provided for in this Indenture and any relevant Supplement relating to the proposed action have been complied with and, if deemed reasonably necessary by the Indenture Trustee or if required pursuant to the terms of this Indenture, an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.
 
(b)      Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include:
 
(i)       a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;
 
(ii)        a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
 
(iii)       a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether such covenant or condition has been complied with; and
 
 
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(iv)      a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.
 
Section 1302.                Form of Documents Delivered to Indenture Trustee .
 
(a)       In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.
 
(b)       Any certificate or opinion may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous.
 
(c)       Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.
 
Section 1303.               Acts of Holders .
 
(a)      Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture or any Supplement to be given or taken by Holders may be (i) embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing, (ii) evidenced by the written consent or direction of Holders of the specified percentage of the principal amount of the Notes, or (iii) evidenced by a combination of such instrument or instruments; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments and record are delivered to the Indenture Trustee and, where it is hereby expressly required, to the Issuer.  Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and conclusive in favor of the Indenture Trustee and the Issuer, if made in the manner provided in this Section.
 
(b)      The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof.  Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority.  The fact and date of the execution of any such instrument   or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Indenture Trustee deems sufficient.
 
 
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(c)      The ownership of Notes shall be proved by the Note Register.
 
(d)      Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Note shall bind every future Holder of the same Note and the Holder of every Note issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Indenture Trustee or the Issuer in reliance thereon, whether or not notation of such action is made upon such Note.
 
Section 1304.                Limitation of Rights; Third Party Beneficiary .
 
Except as expressly set forth in this Indenture, this Indenture shall be binding upon the Issuer, the Noteholders and their respective successors and permitted assigns and shall not inure to the benefit of any Person other than the parties hereto, the Noteholders and the Manager as provided herein.  Notwithstanding the previous sentence, the parties hereto acknowledge that each Interest Rate Hedge Provider is an express third party beneficiary hereof entitled to enforce its rights hereunder as if actually a party hereto.
 
Section 1305.                Severability .
 
If any provision of this Indenture is held to be in   conflict with   any applicable statute or rule of law or is otherwise held to be unenforceable for any reason whatsoever, such circumstances shall not have the effect of rendering the provision in question inoperative or unenforceable in any other case or circumstance, or of rendering any other provision or provisions herein contained invalid, inoperative, or unenforceable to any extent whatsoever.
 
The invalidity of any one or more phrases, sentences, clauses or Sections of this Indenture, shall not affect the remaining portions of this Indenture, or any part thereof.
 
Section 1306.                Notices .
 
All demands, notices and communications hereunder shall be in writing, personally delivered, or by facsimile (with subsequent telephone confirmation of receipt thereof), or sent by internationally recognized overnight courier service, (a) in the case of the Indenture Trustee, at the following address:  MAC N9311-161, Sixth Street and Marquette Avenue, Minneapolis, MN 55479; Attention:  Corporate Trust Services - Asset-Backed Administration, Telephone: (612) 667-8058, Facsimile: (612) 667-3464, (b) in the case of the Issuer, at the following address:  Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda, Telephone:  (441) 295-5950, Telefax:  (441) 292-4720, Attention:  Secretary, with a copy to each:  (i) CAI at its address at 1 Market Plaza, Suite 900, San Francisco, CA 94105, Telephone:  (415) 788-0100, Telefax:  (415) 788-3430, Attention:  CEO and CFO, and (ii) Container Applications Limited at its address at Suite 102, Bush Hill, Bay Street, St. Michael, Barbados, West Indies, Telephone:  (246) 430-5310, Telefax:  (246) 430-5312, Attention: CEO and CFO, with a copy to CAI International, Inc., 1 Market Plaza, Suite 900, San Francisco, CA 94105,  Attention: CEO and CFO, Telephone: (415) 788-0100, Telefax:  (415) 788-3430, (c) in the case of each Rating Agency, its address set forth in the related Supplement and (d) in the case of an Interest Rate Hedge Provider, at its address set forth in the related Interest Rate Hedge Agreement, or at such other address as shall be designated by such party in a written notice to the other parties.  Any notice required or permitted to be given to a Noteholder shall be given by certified first class mail, postage prepaid (return receipt requested), or by courier, or by facsimile, with subsequent telephone confirmation of receipt thereof, in each case at the address of such Holder as shown in the Note Register or to the telephone and fax number furnished by such Noteholder.  Notice shall be effective and deemed received (a) two (2) days after being delivered to the courier service, if sent by courier, (b) upon receipt of confirmation of transmission, if sent by telecopy, or (c) when delivered, if delivered by hand.  Any rights to notices conveyed to a Rating Agency pursuant to the terms of this Indenture with respect to any Series or Class shall terminate immediately if such Rating Agency no longer has a rating outstanding with respect to such Series or Class.
 
 
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Section 1307.                Consent to Jurisdiction .
 
ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE ISSUER ARISING OUT OF OR RELATING TO THIS INDENTURE, OR ANY TRANSACTION CONTEMPLATED HEREBY, MAY BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, STATE OF NEW YORK AND THE ISSUER HEREBY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND, SOLELY FOR THE PURPOSES OF ENFORCING THIS INDENTURE, THE ISSUER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.  THE ISSUER HEREBY IRREVOCABLY APPOINTS AND DESIGNATES CSC CORPORATION SERVICE COMPANY, HAVING AN ADDRESS AT 1180 AVENUE OF THE AMERICAS, SUITE 210, NEW YORK, NEW YORK 10036-8401, ITS TRUE AND LAWFUL ATTORNEY-IN-FACT AND DULY AUTHORIZED AGENT FOR THE LIMITED PURPOSE OF ACCEPTING SERVICING OF LEGAL PROCESS AND THE ISSUER AGREES THAT SERVICE OF PROCESS UPON SUCH PARTY SHALL CONSTITUTE PERSONAL SERVICE OF SUCH PROCESS ON SUCH PERSON.  THE ISSUER SHALL MAINTAIN THE DESIGNATION AND APPOINTMENT OF SUCH AUTHORIZED AGENT UNTIL ALL AMOUNTS PAYABLE UNDER THIS INDENTURE SHALL HAVE BEEN PAID IN FULL.  IF SUCH AGENT SHALL CEASE TO SO ACT, THE ISSUER SHALL IMMEDIATELY DESIGNATE AND APPOINT ANOTHER SUCH AGENT SATISFACTORY TO THE INDENTURE TRUSTEE AND SHALL PROMPTLY DELIVER TO THE INDENTURE TRUSTEE EVIDENCE IN WRITING OF SUCH OTHER AGENT’S ACCEPTANCE OF SUCH APPOINTMENT.
 
Section 1308.                Captions .
 
The captions or headings in this Indenture are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Indenture.
 
Section 1309.                Governing Law .
 
THIS INDENTURE SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK INCLUDING SECTION 5-1401 AND SECTION 5-1402 OF NEW YORK GENERAL OBLIGATIONS LAW, BUT WITHOUT GIVING EFFECT TO ANY OTHER PRINCIPLES OF CONFLICTS OF LAW, AND THE RIGHTS, OBLIGATIONS AND REMEDIES OF THE PARTIES HERETO SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
 
 
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Section 1310.                No Petition .
 
The Indenture Trustee, on its own behalf, hereby covenants and agrees, and each Noteholder by its acquisition of a Note shall be deemed to covenant and agree, that it will not institute against the Issuer any bankruptcy, reorganization, arrangement insolvency or liquidation Proceedings, or other Proceedings under any federal or state bankruptcy or similar law, at any time other than on a date which is at least one (1) year and one (1) day after the last date on which any Note of any Series was Outstanding.
 
Section 1311.                General Interpretive Principles .
 
For purposes of this Indenture except as otherwise expressly provided or unless the context otherwise requires:
 
(a)       the defined terms in this Indenture shall include the plural as well as the singular, and the use of any gender herein shall be deemed to include any other gender;
 
(b)      accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles as in effect on the date hereof;
 
(c)      references herein to “Articles”, “Sections”, “Subsections”, “paragraphs”, and other subdivisions without reference to a document are to designated Articles, Sections, Subsections, paragraphs and other subdivisions of this Indenture;
 
(d)      a reference to a Subsection without further reference to a Section is a reference to such Subsection as contained in the same Section in which the reference appears, and this rule shall also apply to paragraphs and other subdivisions;
 
(e)       the words “herein”, “hereof’, “hereunder” and other words of similar import   refer to this Indenture as a whole and not to any particular provision;
 
(f)       the term “include” or “including” shall mean without limitation by reason of enumeration; and
 
(g)      When referring to Section 302 or Section 806 of this Indenture, the term “or” shall be additive and not exclusive.
 
Section 1312.                WAIVER OF JURY TRIAL .  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, AS AGAINST THE OTHER PARTIES HERETO, ANY RIGHTS IT MAY HAVE TO A JURY TRIAL IN RESPECT OF ANY CIVIL ACTION OR PROCEEDING (WHETHER ARISING IN CONTRACT OR TORT OR OTHERWISE), INCLUDING ANY COUNTERCLAIM, ARISING UNDER OR RELATING TO THIS AGREEMENT OR ANY OTHER OPERATIVE DOCUMENT, INCLUDING IN RESPECT OF THE NEGOTIATION, ADMINISTRATION OR ENFORCEMENT HEREOF OR THEREOF.
 
 
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Section 1313.                Waiver of Immunity
 
.  To the extent that any party hereto or any of its property is or becomes entitled at any time to any immunity on the grounds of sovereignty or otherwise from any legal actions, suits or Proceedings, from set-off or counterclaim, from the jurisdiction or judgment of any competent court, from service of process, from execution of a judgment, from attachment prior to judgment, from attachment in aid of execution, or from execution prior to judgment, or other legal process in any jurisdiction, such party, for itself and its successors and assigns and its property, does hereby irrevocably and unconditionally waive, and agrees not to plead or claim, any such immunity with respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Indenture, the other Related Documents or the subject matter hereof or thereof, subject, in each case, to the provisions of the Related Documents and mandatory requirements of Applicable Law.
 
Section 1314.                Judgment Currency
 
.  The parties hereto (A) acknowledge that the matters contemplated by this Indenture are part of an international financing transaction and (B) hereby agree that (i) specification and payment of Dollars is of the essence, (ii) Dollars shall be the currency of account in the case of all obligations under the Related Documents unless otherwise expressly provided herein or therein, (iii) the payment obligations of the parties under the Related Documents shall not be discharged by an amount paid in a currency or in a place other than that specified with respect to such obligations, whether pursuant to a judgment or otherwise, except to the extent actually received by the Person entitled thereto and converted into Dollars by such Person (it being understood and agreed that, if any transaction party shall so receive an amount in a currency other than Dollars, it shall (A) if it is not the Person entitled to receive payment, promptly return the same (in the currency in which received) to the Person from whom it was received or (B) if it is the Person entitled to receive payment, either, in its sole discretion, (x) promptly return the same (in the currency in which received) to the Person from whom it was received or (y) subject to reasonable commercial practices, promptly cause the conversion of the same into Dollars), (iv) to the extent that the amount so paid on prompt conversion to Dollars under normal commercial practices does not yield the requisite amount of Dollars, the obligee of such payment shall have a separate cause of action against the party obligated to make the relevant payment for the additional amount necessary to yield the amount due and owing under the Related Documents, (v) if, for the purpose of obtaining a judgment in any court with respect to any obligation under any of the Related Documents, it shall be necessary to convert to any other currency any amount in Dollars due thereunder and a change shall occur between the rate of exchange applied in making such conversion and the rate of exchange prevailing on the date of payment of such judgment, the obligor in respect of such obligation will pay such additional amounts (if any) as may be necessary to insure that the amount paid on the date of payment is the amount in such other currency which, when converted into Dollars and transferred to New York City, New York, in accordance with normal banking procedures, will result in realization of the amount then due in Dollars and (vi) any amount due under this paragraph shall be due as a separate debt and shall not be affected by or merged into any judgment being obtained for any other sum due under or in respect of the Related Documents.
 
 
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Section 1315.                Statutory References
 
.  References in this Indenture and each other Related Document for any Series to any section of the Uniform Commercial Code or the UCC shall mean, on or after the effective date of adoption of any revision to the Uniform Commercial Code or the UCC in the State of New York, such revised or successor section thereto.
 
Section 1316.                Counterparts
 
.  This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  Delivery of an executed counterpart of a signature page of this Agreement by facsimile shall be effective as delivery of a manually executed counterpart of this Agreement.
 
 
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IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused this Indenture to be duly executed and delivered by their respective officers thereunto duly authorized as of the day and year first above written.
 
 
CAL FUNDING II LIMITED
 
       
 
By:
/s/ Timothy B. Page    
       
  Name:   Timothy B. Page   
       
  Title:   Chief Financial Officer     
 
 
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Indenture Trustee
 
       
 
By:
/s/ G. Brad Martin     
       
  Name: G. Brad Martin  
       
  Title:  Vice President     

 
 
 

EXHIBIT A
 
DEPRECIATION METHODS BY TYPE OF CONTAINER
 
Depreciation Methods - GAAP
 
1.             For purposes of any calculation of the Asset Base, a Managed Container is depreciated using the straight-line method, over the applicable estimated useful life to the applicable estimated residual value, as listed below for each respective type of Container:
 
Container Type
 
Depreciable Life
(years)
   
Useful Life
(years)
   
Residual Value
 
20' Dry Van Container
    13.0       15.0     $ 1,050  
20' High Cube Container
    12.5       15.0     $ 1,000  
20' Refrigerated Container
    12.0       15.0     $ 2,750  
20' Hard Open Top
    12.5       15.0     $ 1,000  
40' Dry Van Container
    13.0       15.0     $ 1,300  
40' High Cube Container
    13.0       15.0     $ 1,650  
40' High Cube Refrigerated Container
    12.0       15.0     $ 3,500  
40' Open Top Container
    12.5       15.0     $ 1,250  
40' 8'6" Palletwide Cell
    12.5       15.0     $ 1,040  
45' 9'6" Palletwide C44
    12.5       15.0     $ 1,235  
Genset-underslung/Centermount
    12.5       15.0     $ 1,500  
40' 100 Ton Rolltrailer
    15.0       15.0     $ 3,380  
All Others
    15.0       15.0    
15% of Original Equipment Cost
 
 
2.           For any purpose other than that described in item 1 above, including without limitation the calculation of financial covenants, the preparation of financial reports, and the calculation of the purchase price to be paid for any containers, the Depreciation Policy shall be in accordance with GAAP (provided that any change in the Depreciation Policy, as described in this item 2, resulting from the application of GAAP, or from the requirements of the Issuer’s accountants applying GAAP, shall be deemed not to constitute a change to the Depreciation Policy under any of the Related Documents).
 
 
 
 
 
EXHIBIT B
 
FORM OF PURCHASER LETTER
 
(Transfers pursuant to Rule 144A)
 
FOR VALUE RECEIVED the undersigned registered Holder (the “Seller”) hereby sell(s), assign(s) and transfer(s) unto (please print or type name and address including postal zip code of assignee):
 
   _________________________________________________________________________________________________________ (The “Purchaser”), Taxpayer Identification No.  _______________________, the accompanying [Series _____ Asset Backed Note bearing number __________________] and all rights thereunder, hereby irrevocably constituting and appointing ___________________ attorney to transfer said Note on the books of the Issuer with full power of substitution in the premises.
 
1.            In connection with such transfer and in accordance with Section 205 of the Indenture (as amended or supplemented from time to time as permitted thereby, the “Indenture”), dated as of October 18, 2012, between CAL Funding II Limited and Wells Fargo Bank, National Association (the “Indenture Trustee”), the Seller hereby certifies the following facts:  Neither the Seller nor anyone acting on its behalf has (a) offered, transferred, pledged, sold or otherwise disposed of the Note, any interest in the Note or any other similar security, (b) solicited any offer to buy or accept a transfer, pledge or other disposition of the Note, any interest in the Note or any other similar security from, any Person in any manner, or (c) made any general solicitation by means of general advertising or in any other manner, or taken any other action which would constitute a distribution of the Note under the Securities Act of 1933, as amended (the “1933 Act”), or which would render the disposition of the Note a violation of Section 5 of the 1933 Act or require registration pursuant thereto.
 
Capitalized terms used herein but not otherwise defined shall have the meaning ascribed to such terms in the Indenture, or if not defined therein, as defined in the Series ________ Supplement, dated as of __________, between the Issuer and the Indenture Trustee.
 
2.            The Purchaser warrants and represents to, and covenants with, the Seller, the Indenture Trustee and the Manager pursuant to Section 205 of the Indenture as follows:
 
a.            The Purchaser understands that the Note has not been registered under the 1933 Act or the securities laws of any State.
 
b.            The Purchaser is acquiring the Note for investment for its own account only and not for any other Person.
 
c.            The Purchaser considers itself a substantial, sophisticated institutional investor having such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of investment in the Note.
 
 
 
 
 
d.            The Purchaser is a “qualified institutional buyer” as that term is defined in Rule 144A under the 1933 Act (“Rule 144A”) and has completed either of the forms of certification to that effect attached hereto as Annex 1 or Annex 2.  The Purchaser is aware that the sale to it is being made in reliance on Rule 144A.  The Purchaser is acquiring the Note for its own account or for the account of another qualified institutional buyer, understands that such Note may be offered, resold, pledged or transferred only (i) to a qualified institutional, buyer, or to an offeree or purchaser that the Purchaser reasonably believes is a qualified institutional buyer, that purchases for its own account or for the account of another qualified institutional buyer to whom notice is given that the resale, pledge or transfer is being made in reliance on Rule 144A, or (ii) pursuant to another exemption from registration under the 1933 Act.
 
e.            The Purchaser is not a Competitor.
 
3.            The Purchaser represents to the Indenture Trustee, the Issuer and the Manager or any successor Manager that one of the following statements is true and correct:  (i) the purchaser is not an “employee benefit plan” within the meaning of Section 3(3) of ERISA or a “plan” within the meaning of Section 4975(e)(1) of the Code (“Benefit Plan”) and it is not directly or indirectly acquiring the Notes on behalf of, as investment manager of, as named fiduciary of, as trustee of, or with assets of, a Benefit Plan, (ii) the acquisition will qualify for a statutory or administrative prohibited transaction exemption under ERISA and the Code and will not give rise to a non-exempt transaction described in Section 406 of ERISA or Section 4975(c) of the Code, (iii) the source of funds (the “Source”) to be used by the Purchaser to pay the purchase price of the Notes is a guaranteed benefit policy within the meaning of Section 401(b)(2)(B) of ERISA, or (iv) the Source to be used by the purchaser to pay the purchase price of the Notes is an “insurance company general account” within the meaning of Department of Labor Prohibited Transaction Exemption (“PTE”) 95-60 (issued July 12, 1995), and there is no “employee benefit plan” or “plan” (within the meaning of Section 3(3) of ERISA or Section 4975(e)(1) of the Code as applicable, and treating as a single plan, all plans maintained by the same employer (or an affiliate within the meaning of Section V(a)(1) of PTE 95-60) or employee organization) with respect to which the amount of the reserves and liabilities for the general account contracts held by or on behalf of such plan, as defined by the annual statement for life insurance companies approved by the National Association of Insurance Commissioners (the “NAIC Annual Statement”), exceed ten percent (10%) of the total reserves and liabilities of such general account (exclusive of separate account liabilities) plus surplus, as set forth in the NAIC Annual Statement filed with the Purchaser’s state of domicile.
 
4.            This document may be executed in one or more counterparts and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed to be an original; such counterparts, together, shall constitute one and the same document.
 
 
 
 
 
IN WITNESS WHEREOF, each of the parties have caused this document to be executed by their duly authorized officers as of the date set forth below.
 
         
Seller     Purchaser  
 
           
By:      By:    
 
Name:
   
Name:
 
 
Title:
   
Title:
 
 
Taxpayer Identification No.:
   
Taxpayer Identification No.:
 
           
           
Date:       Date:    
 
 
 
 
 
ANNEX 1 TO EXHIBIT B
 
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
 
[For Purchasers Other Than Registered Investment Companies]
 
The undersigned hereby certifies as follows to the parties identified in Section 2 of the attached Purchaser Letter:
 
1.            As indicated below, the undersigned is the President, Chief Financial Officer, Senior Vice President or other senior executive officer of the Purchaser.
 
2.            The Purchaser is a “qualified institutional buyer” as that term is defined in Rule 144A under the Securities Act of 1933 (“Rule 144A”) because (i) the Purchaser owned and/or invested on a discretionary basis $__________________ 1 in securities (except for the excluded securities referred to in paragraph 3 below) as of the end of the Purchaser’s most recent fiscal year (such amount being calculated in accordance with Rule 144A) and (ii) the Purchaser satisfies the criteria in the category marked below.
 
 
____
Corporation etc .  The Purchaser is a corporation (other than a bank, savings and loan association or similar institution), a Massachusetts or similar business trust, a partnership, or a charitable organization described in Section 501(c)(3) of the Internal Revenue Code.
 
 
____
Bank .  The Purchaser (a) is a national bank or banking institution organized under the laws of any State, territory or the District of Columbia, the business of which is substantially confined to banking and is supervised by the State or territorial banking commission or similar official or is a foreign bank or equivalent institution, and (b) has an audited net worth of at least $25,000,000 as demonstrated in its latest annual financial statements, a copy of which is attached hereto.
 
 
____
Savings and Loan .  The Purchaser (a) is a savings and loan association, building and loan association, cooperative bank, homestead association or similar institution, which is supervised and examined by a state or federal authority having supervision over any such institutions, or is a foreign savings and loan association or equivalent institution and (b) has an audited net worth of at least $25,000,000 as demonstrated in its latest annual financial statements, a copy of which is attached hereto.
 
 
____
Broker-dealer .  The Purchaser is a dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934.
 
1   Buyer must own and/or invest on a discretionary basis at least $100,000,000 in securities unless Buyer is a dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, and, in that case, Buyer must own and/or invest on a discretionary basis at least $10,000,000 in securities.
 
 
 
 
 
 
____
Insurance Company .  The Purchaser is organized as an insurance company whose primary and predominant business activity is the writing of insurance or the reinsuring of risks underwritten by insurance companies, and which is subject to supervision by the insurance commissioner or a similar official or agency of a State, territory or the District of Columbia.
 
 
____
State or Local Plan .  The Purchaser is a plan established and maintained by a State, its political subdivisions, or any agency or instrumentality of the State or its political subdivisions, for the benefit of its employees.
 
 
____
ERISA Plan .  The Purchaser is an employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974.
 
 
____
Investment Advisor .  The Purchaser is an investment advisor registered under the Investment Advisers Act of 1940.
 
3.            The term “securities” as used herein does not include (i) securities of issuers that are affiliated with the Purchaser, (ii) securities that are part of an unsold allotment to or subscription by the Purchaser, if the Purchaser is a dealer, (iii) securities issued or guaranteed by the U.S.  or any instrumentality thereof, (iv) bank deposit notes and certificates of deposit, (v) loan participations, (vi) repurchase agreements, (vii) securities owned but subject to a repurchase   agreement and (viii) currency, interest rate and commodity swaps.
 
4.            For purposes of determining the aggregate amount of securities owned and/or invested on a discretionary basis by the Purchaser, the Purchaser used the cost of such securities to the Purchaser (except as provided in Rule 144A(a)(3)) and did not include any of the securities referred to in the preceding paragraph.  Further, in determining such aggregate amount, the Purchaser may have included securities owned by subsidiaries of the Purchaser, but only if such subsidiaries are consolidated with the Purchaser in its financial statements prepared in accordance with generally accepted accounting principles and if the investments of such subsidiaries are managed under the Purchaser’s direction.  However, such securities were not included if the Purchaser is a majority-owned, consolidated subsidiary of another enterprise and the Purchaser is not itself a reporting company under the Securities Exchange Act of 1934.
 
5.            The Purchaser acknowledges that it is familiar with Rule 144A and understands that the seller to it and other parties related to the Notes are relying and will continue to rely on the statements made herein because one or more sales to the Purchaser may be in reliance on Rule 144A.
 
____         ____
 Yes            No
Will the Purchaser be purchasing the
Certificate only for Purchaser’s own account?

6.            If the answer to the foregoing question is “no”, the Purchaser agrees that, in connection with, any purchase of securities sold to the Purchaser for the account of a third party (including any separate account) in reliance on Rule 144A, the Purchaser will only purchase for the account of a third party that at the time is a “qualified institutional buyer” within the meaning of Rule 144A.  In addition, the Purchaser agrees that the Purchaser will not purchase securities for a third party unless the Purchaser has obtained a certificate from such third party substantially identical to this certification or taken other appropriate steps contemplated by Rule 144A to conclude that such third party independently meets the definition of “qualified institutional buyer” set forth in Rule 144A.
 
 
 
 
 
7.            The Purchaser will notify each of the parties to which this certification is made of any changes in the information and conclusions herein.  Until such notice is given, the Purchaser’s purchase of the Note will constitute a reaffirmation of this certification as of the date of such purchase.
 
     
 
Print Name of Purchaser
 
     
  By:      
  Name:    
 
Title:
   
       
  Date:    
 
 
 
 
 
ANNEX 2 TO EXHIBIT B
 
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
 
[For Purchasers That Are Registered Investment Companies]
 
The undersigned hereby certifies as follows to the parties identified in Section 2 of the attached Purchaser Letter:
 
1.            As indicated below, the undersigned is the President, Chief Financial Officer or Senior Vice President or other senior executive officer of the Purchaser or, if the Purchaser is a “qualified institutional buyer” as that term is defined in Rule 144A under the Securities Act of 1933 (“Rule 144A”) because Purchaser is part of a Family of Investment Companies (as defined below), is such an officer of the adviser.
 
2.            The Purchaser is a “qualified institutional buyer” as defined in SEC Rule 144A because (i) the Purchaser is an investment company registered under the Investment Company Act of 1940, and (ii) as marked below, the Purchaser alone, or the Purchaser’s Family of Investment Companies, owned at least $100,000,000 in securities (other than the excluded securities referred to below) as of the end of the Purchaser’s most recent fiscal year.  For purposes of determining the amount of securities owned by the Purchaser or the Purchaser’s Family of Investment Companies, the cost of such securities was used (except as provided in Rule 144(a)(3)).
 
____
The Purchaser owned $_______________ in securities (other than the excluded securities referred to below) as of the end of the Purchaser’s most recent fiscal year (such amount being calculated in accordance with Rule 144A).
 
____
The Purchaser is part of a Family of Investment Companies which owned in the aggregate $_______________ in securities (other than the excluded securities referred to below) as of the end of the Purchaser’s most recent fiscal year (such amount being calculated in accordance with Rule 144A).
 
3.            The term “Family of Investment Companies” as used herein means two or more registered investment companies (or series thereof), except for a unit investment trust whose assets consist solely of shares on one or more registered investment companies that have the same investment adviser or investment advisers that are affiliated (by virtue of being majority owned subsidiaries of the same parent or because one investment adviser is a majority owned subsidiary of the other), or, in the case of unit investment trusts, the same depositor.
 
4.            The term “securities” as used herein does not include (i) securities of issuers that are affiliated with the Purchaser or are part of the Purchaser’s Family of Investment Companies, (ii) securities issued or guaranteed by the U.S.  or any instrumentality thereof, (iii) bank deposit notes and certificates of deposit, (iv) loan participations, (v) repurchase agreements, (vi) securities owned but subject to a repurchase agreement and (vii) currency, interest rate and commodity swaps.
 
 
 
 
 
5.            The Purchaser acknowledges that it is familiar with Rule 144A and understands that the seller to it and the other parties related to the Note are relying and will continue to rely on the statements made herein because one or more sales to the Purchaser will be in reliance on Rule 144A.
 
6.            The undersigned will notify the parties addressed the Purchaser Letter to which this certification relates of any changes in the information and conclusions herein.  Until such notice, the Purchaser’s purchase of the Note will constitute a reaffirmation of this certification by the undersigned as of the date of such purchase.
 
     
 
Print Name of Purchaser or Adviser
 
     
  By:    
    Name:  
   
Title:
 
 
 
IF AN ADVISER:
 
     
 
Print Name of Purchaser
 
       
 
Date:
   

 
 
 

EXHIBIT C
 
FORM OF PURCHASER CERTIFICATION
 
(Transfers other than Rule 144A)
 
FOR VALUE RECEIVED the undersigned registered Holder (the “Seller”) hereby sell(s), assign(s) and transfer(s) unto (please print or type name and address including postal zip code of assignee):
 
__________________________________________________________________________________________________________ (the “Purchaser”), Taxpayer Identification No.___________________ the accompanying Series _____ Asset Backed Note bearing number __________________ (the “Note”) and all rights thereunder, hereby irrevocably constituting and appointing _____________________ attorney to transfer said Note on the books of the Issuer with full power of substitution in the premises.
 
1.            In connection with such transfer and in accordance with Section 205 of the Indenture (as amended or supplemented from time to time as permitted thereby, the “Indenture”), dated as of October 18, 2012, between CAL Funding II Limited and Wells Fargo Bank, National Association (the “Indenture Trustee”) the Seller hereby certifies the following facts:  Neither the Seller nor anyone acting on its behalf has (a) offered, transferred, pledged, sold or otherwise disposed of the Note, any interest in the Note or any other similar security, or (b) solicited any offer to buy or accept a transfer, pledge or other disposition of the Note, any interest in the Note or any other similar security from, any Person in any manner, or (c) made any general solicitation by means of general advertising or in any other manner, or taken any other action which would constitute a distribution of the Note under the Securities Act of 1933, as amended (the “1933 Act”), or which would render the disposition of the Note a violation of Section 5 of the 1933 Act or require registration pursuant thereto.
 
Capitalized terms used herein but not otherwise defined shall have the meaning ascribed to such terms in the Indenture, or if not defined therein, as defined in the Series ________ Supplement, dated as of __________________, between the Issuer and the Indenture Trustee.
 
2.            The Purchaser warrants and represents to, and covenants with, the Seller, the Indenture Trustee and the Manager pursuant to Section 205 of the Indenture as follows:
 
a.            The Purchaser understands that the Note has not been registered under the 1933 Act or the securities laws of any State.
 
b.            The Purchaser is acquiring the Note for investment for its own account only and not for any other Person.
 
c.            The Purchaser is an institutional accredited investor within the meaning of Rule 501(a)(1), (2), (3) or (7) under the 1933 Act.
 
 
 
 
 
d.            The Purchaser considers itself a substantial, sophisticated institutional investor having such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of investment in the Note.
 
[e. The Purchaser is not a Competitor.]
 
3.            The Purchaser represents to the Indenture Trustee, the Issuer and the Manager or any successor Manager that one of the following statements is true and correct:  (i) the purchaser is not an “employee benefit plan” within the meaning of Section 3(3) of ERISA or a “plan” within the meaning of Section 4975(e)(1) of the Code (“Benefit Plan”) and it is not directly or indirectly acquiring the Notes on behalf of, as investment manager of, as named fiduciary of, as trustee of, or with assets of, a Benefit Plan, (ii) the acquisition will qualify for a statutory or administrative prohibited transaction exemption under ERISA and the Code and will not give rise to a non-exempt transaction described in Section 406 of ERISA or Section 4975(c) of the Code, (iii) the source of funds (the “Source”) to be used by the Purchaser to pay the purchase price of the Notes is a guaranteed benefit policy within the meaning of Section 401(b)(2)(B) of ERISA, or (iv) the Source to be used by the purchaser to pay the purchase price of the Notes is an “insurance company general account” within the meaning of Department of Labor Prohibited Transaction Exemption (“PTE”) 95-60 (issued July 12, 1995), and there is no “employee benefit plan” or “plan” (within the meaning of Section 3(3) of ERISA or Section 4975(e)(1) of the Code as applicable, and treating as a single plan, all plans maintained by the same employer (or an affiliate within the meaning of-Section V(a)(1) of PTE 95-60) or employee organization) with respect to which the amount of the reserves and liabilities for the general account contracts held by or on behalf of such plan, as defined by the annual statement for life insurance companies approved by the National Association of Insurance Commissioners (the “NAIC Annual Statement”), exceed ten percent (10%) of the total reserves and liabilities of such general account (exclusive of separate account liabilities) plus surplus, as set forth in the NAIC Annual Statement filed with the purchaser’s state of domicile.
 
4.            This document may be executed in one or more counterparts and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed to be an original; such counterparts, together, shall constitute one and the same document.
 
 
 
 
 
IN WITNESS WHEREOF, each of the parties have caused this document to be executed by their duly authorized officers as of the date
 
         
Seller     Purchaser  
 
           
By:      By:    
 
Name:
   
Name:
 
 
Title:
   
Title:
 
 
Taxpayer Identification No.:
   
Taxpayer Identification No.:
 
           
           
Date:       Date:    
 
 
 
 
 
EXHIBIT D
 
FORM OF NON-RECOURSE RELEASE
 
Indenture Trustee’s Certificate
pursuant to Section 404 of the Indenture
 
Wells Fargo Bank, National Association, as indenture trustee (the “ Indenture Trustee ”) pursuant to the Indenture (as amended or supplemented from time to time as permitted thereby, the “ Indenture ”), dated as of October 18, 2012, between CAL Funding II Limited (the “ Issuer ”) and the Indenture Trustee does hereby sell, transfer, assign, deliver and otherwise convey to __________________ (the “ Assignee ”), without recourse, representation or warranty, except that the Indenture Trustee has not created any liens, claims or encumbrances on any assets identified in the attached certificate and all income and proceeds thereof other than the lien of the Indenture, all of the Indenture Trustee’s right, title and interest in and to all of the assets identified in the attached certificate and all income thereon and proceeds thereof and all security and documents relating thereto.
 
IN WITNESS WHEREOF, I have hereunto set my hand this ___ day of _______________________.
 
 
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Indenture Trustee
       
 
By:
   
       
  Title:    
 
 
 
 
          
EXHIBIT E
 
FORM OF CONTROL AGREEMENT
 
[SEE ATTACHED]
 
 
 
 
 
EXHIBIT F
 
INTERCREDITOR COLLATERAL AGREEMENT
 
[SEE ATTACHED]
 
 
 
 
 
EXHIBIT G
 
TABLE OF COST-EQUIVALENT UNITS (CEU'S)
 
CEU per Container type (Equivalent definitional term to SCU or FEU)

 
Equipment Number Code
 
 
Equipment  Description
 
 
CEU Weighting
20
 
20' Dry Van Container
 
Std Dry Container
21
 
20' High Cube Container
 
Std Dry Container
22
 
20' Refrigerated Container
 
Refrig Container
26
 
20' Open Top Container
 
Special
27
 
20' Convertible Open Top
 
Special
28
 
20' Hard Open Top
 
Special
29
 
20' Box Container
 
Special
40
 
40' Dry Van Container
 
Std Dry Container
41
 
40' High Cube Container
 
Std Dry Container
43
 
40' High Cube Refrigerated Container
 
Refrig Container
44
 
40' Collapsible Flat Rack
 
Special
45
 
40' Fixed End Flat Rack
 
Special
46
 
40' Open Top Container
 
Special
48
 
45' High Cube Container
 
Special
49
 
40' Open Side Container
 
Special
62
 
40' 8'6" Palletwide Cell
 
Special
64
 
45' 9'6" Palletwide C44
 
Special
60EUR
 
40' 9'6" Palletwide-Europe
 
Special
61EUR
 
40' 8'6" Palletwide Cell-Europe
 
Special
62EUR
 
40' 9'6" Palletwide Cell-Europe
 
Special
63EUR
 
45' 9'1" Palletwide C32-Europe
 
Special
64EUR
 
45' 9'6" Palletwide C44-Europe
 
Special
65EUR
 
45' 9'6" Palletwide-Europe
 
Special
66EUR
 
13.6 Meter Box Container-Europe
 
Special
G1
 
Genset-underslung/centermount
 
GenSet
G2
 
Genset- Clip On
 
GenSet
M2
 
20' Modular Collapsible
 
Special
R0
 
40' 100 Ton Rolltrailer
 
Special
R0EUR
 
40' 100 Ton Rolltrailer
 
Special
R2
 
40' 120 Ton Rolltrailer
 
Special
R2EUR
 
40' 120 Ton Rolltrailer
 
Special
R6
 
40'  60 Ton Rolltrailer
 
Special
R6EUR
 
40'  60 Ton Rolltrailer
 
Special
R7
 
40'  70 Ton Rolltrailer
 
Special
R7EUR
 
40'  70 Ton Rolltrailer
 
Special
R8
 
40'  80 Ton Rolltrailer
 
Special
R8EUR
 
40'  80 Ton Rolltrailer
 
Special
S4
 
40' Swap Body
 
Special
ALL OTHERS
 
ALL Others
 
Special
 
 
EXHIBIT 4.2
 
CAL FUNDING II LIMITED
Issuer
 
and
 
WELLS FARGO BANK, NATIONAL ASSOCIATION
Indenture Trustee
 
 
SERIES 2012-1 SUPPLEMENT
 
Dated as of October 18, 2012
 
to
 
INDENTURE
 
Dated as of October 18, 2012
 
 
SERIES 2012-1 NOTES
 
 
 
 
 
 
TABLE OF CONTENTS
 
 
Page
   
ARTICLE I Definitions; Calculation Guidelines
1
   
Section 101.
Definitions
1
     
ARTICLE II Creation of the Series 2012-1 Notes
5
   
Section 201.
Designation
5
Section 202.
Authentication and Delivery
5
Section 203.
Interest Payments on the Series 2012-1 Notes
6
Section 204.
Principal Payments on the Series 2012-1 Notes
7
Section 205.
Prepayment of Principal on the Series 2012-1 Notes
7
Section 206.
Payments of Principal and Interest
8
Section 207.
Restrictions on Transfer
8
     
ARTICLE III Series 2012-1 Series Account and Allocation and Application of Amounts Therein
12
   
Section 301.
Series 2012-1 Series Account
12
Section 302.
Drawing Funds from the Restricted Cash Account
13
Section 303.
Distributions from Series 2012-1 Series Account
13
     
ARTICLE IV Additional Covenants
15
   
Section 401.
Rule 144A
15
Section 402.
Use of Proceeds
16
Section 403.
Perfection Requirements
16
Section 404.
United States Federal Income Tax Election
16
Section 405.
OFAC Matters
16
     
ARTICLE V Conditions to Issuance
16
   
Section 501.
Conditions to Issuance
16
     
ARTICLE VI Representations and Warranties
16
   
Section 601.
Existence
16
Section 602.
Authorization
17
Section 603.
No Conflict; Legal Compliance
17
Section 604.
Validity and Binding Effect
17
Section 605.
Financial Statements
17
Section 606.
Place of Business
17
Section 607.
No Agreements or Contracts
18
Section 608.
Consents and Approvals
18
Section 609.
Margin Regulations
18
Section 610.
Taxes
18
Section 611.
Other Regulations
18
Section 612.
Solvency and Separateness
19
Section 613.
Title; Liens
19
Section 614.
No Default
19
Section 615.
Litigation and Contingent Liabilities
19
Section 616.
Subsidiaries
20
 
 
 
 
 
TABLE OF CONTENTS
(continued)
 
   
Page
     
Section 617.
No Partnership
20
Section 618.
Pension and Welfare Plans
20
Section 619.
Ownership of Issuer
20
Section 620.
Security Interest Representations
20
Section 621.
ERISA Lien
22
Section 622.
Survival of Representations and Warranties
22
     
ARTICLE VII Miscellaneous Provisions
22
   
Section 701.
Ratification of Indenture
22
Section 702.
Counterparts
22
Section 703.
Governing Law
22
Section 704.
Notices
23
Section 705.
Amendments and Modifications
23
Section 706.
Consent to Jurisdiction
23
Section 707.
Waiver of Jury Trial
24
Section 708.
Successors
24
Section 709.
Nonpetition Covenant
24
Section 710.
Recourse Against the Issuer
24
Section 711.
Reports, Financial Statements and Other Information to Noteholders
25

 
-ii-
 
 
TABLE OF CONTENTS
(continued)
 
 
Page
   
EXHIBITS
 
EXHIBIT A-1
Form of 144A Book-Entry Note
 
EXHIBIT A-2
Form of Regulation S Temporary Book-Entry Note
 
EXHIBIT A-3
Form of Unrestricted Book-Entry Note
 
EXHIBIT A-4
Form of Note Issued to Institutional Accredited Investors
 
EXHIBIT B
Form of Certificate to be Given by Noteholders
 
EXHIBIT C
Form of Certificate to be Given by Euroclear or Clearstream
 
EXHIBIT D
Form of Certificate to be Given by Transferee of Beneficial Interest In a Regulation S Temporary Book-Entry Note
 
EXHIBIT E
Form of Transfer Certificate for Exchange or Transfer From 144A Book-Entry Note to Regulation S Book-Entry Note
 
EXHIBIT F
Form of Initial Purchasers Exchange Instructions
 

SCHEDULES
 
SCHEDULE 1
Series 2012-1 Minimum Targeted Principal Balances and Series 2012-1 Scheduled Targeted Principal Balances by Payment Date
 
 
-iii-
 
 
SERIES 2012-1 SUPPLEMENT, dated as of October 18, 2012 (as amended, modified and supplemented from time to time in accordance with the terms hereof, this “ Supplement ”), between CAL FUNDING II LIMITED, an exempted company with limited liability incorporated and existing under the laws of Bermuda (the “ Issuer ”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as Indenture Trustee (the “ Indenture Trustee ”).

WHEREAS, pursuant to the Indenture, dated as of October 18, 2012 (as amended and supplemented from time to time in accordance with its terms, the “ Indenture ”), between the Issuer and the Indenture Trustee, the Issuer may from time to time direct the Indenture Trustee to authenticate one or more new Series of Notes. The Principal Terms of any new Series are to be set forth in a Supplement to the Indenture.
 
WHEREAS, pursuant to this Supplement, the Issuer and the Indenture Trustee shall create a new Series of Notes (“ Series 2012-1 ”) and specify the Principal Terms thereof.
 
NOW THEREFORE, in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:
 
ARTICLE I
 
Definitions; Calculation Guidelines
 
Section 101.    Definitions .  (a)  Whenever used in this Supplement, the following words and phrases shall have the following meanings, and the definitions of such terms are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms.
 
“ Accelerated Measurement Period ”   shall have the   meaning set forth in Section 205(c) hereof.
 
“ Advance Rate ” means eighty-two percent (82%).
 
“ Aggregate Series 2012-1 Note Principal Balance ” means, as of any date of determination, an amount equal to the sum of the Series 2012-1 Note Principal Balances of all Series 2012-1 Notes then Outstanding, which as of the Closing Date shall be One Hundred Seventy-One Million Dollars ($171,000,000).
 
“ Closing Date ”   means October 18, 2012.
 
“ Control Party ” means, with respect to Series 2012-1 Notes, the holders representing more than fifty percent (50%) of the then unpaid principal balance of all Series 2012-1 Notes then Outstanding.
 
“ Default Interest ” means, for any Payment Date, the amount of incremental interest payable on the Series 2012-1 Notes in accordance with the provisions of Section 203(b) hereof .
 
 
 
 
 
“ DTC ” shall have the meaning set forth in Section 207(b)(v) hereof.
 
“ Funding Date ” means the date on which all of the conditions precedent set forth in Section 501 hereof shall be satisfied.
 
“ Initial Purchasers ” means each of Merrill Lynch, Pierce, Fenner & Smith Incorporated, a corporation organized and existing under the laws of the State of Delaware and Wells Fargo Securities, LLC, a limited liability company organized under the laws of the State of Delaware.
 
“ Interest Accrual Period ” means, with respect to any Payment Date, the period from (and including) the 25th day of the immediately preceding month (or from (and including) the Closing Date, with respect to the first Payment Date) to (but excluding) the 25th day of the current month.
 
“ Interest Rate Hedge Agreements ” means an ISDA interest rate swap or cap agreement between the Issuer and the Interest Rate Hedge Provider named therein pursuant to which (i) the Issuer will receive payments from the Interest Rate Hedge Provider based on LIBOR and (ii) recourse by the Interest Rate Hedge Provider to the Issuer is limited to that portion of the Available Distribution Amount which pursuant to the terms of this Indenture is available for such payment.
 
“ Interest Rate Hedge Provider ” means any Person (other than the Issuer) that has entered into an Interest Rate Hedge Agreement with the Issuer until such Person is terminated or replaced under the related Interest Rate Hedge Agreement.
 
“ Minimum Principal Payment Amount ” means, for the Series 2012-1 Notes on each Payment Date, an amount equal to the excess, if any, of (x) the Aggregate Series 2012-1 Note Principal Balance as of such Payment Date (prior to giving effect to any principal payments scheduled to be paid with respect to the Series 2012-1 Notes on such Payment Date) over (y) the Minimum Targeted Principal Balance for the Series 2012-1 Notes for such Payment Date.
 
“ Minimum Targeted Principal Balance ” means, for the Series 2012-1 Notes for each Payment Date, subject to Section 205(c) , the amount set forth opposite such Payment Date on Schedule 1 hereto under the column entitled “Minimum Targeted Principal Balance”.
 
“ Notes ” means the Series 2012-1 Notes.
 
“ 144A Book-Entry Notes ” means the 144A Book-Entry Notes substantially in the form of Exhibit A-1 hereto.
 
“ Overdue Rate ” means, for any date of determination, an interest rate per annum equal to the sum of (i) the interest rate otherwise in effect hereunder plus (ii) two percent (2.00%).
 
“ Permitted Non-U.S. Person ” means any Person (i) who is not a U.S. Person and (ii) to whom the offer and sale of the Series 2012-1 Notes may be made without registration under the Securities Act in reliance upon Regulation S.
 
 
2
 
 
“ Permitted Payment Date Withdrawal ” means, with respect to Series 2012-1, either or both of the Permitted Interest Withdrawal, as such term is defined in Section 303 hereof, and/or the Permitted Principal Withdrawal, as such term is defined in Section 303(b) hereof.
 
“ Qualified Institutional Buyers ” shall have the meaning set forth in Section 207(a)(i) hereof.
 
“ Regulation S ” means Regulation S under the Securities Act.
 
“ Regulation S Temporary Book-Entry Notes ” means the Regulation S Temporary Book-Entry Notes substantially in the form of Exhibit A-2 hereto.
 
“ Rule 144A ” shall have the meaning set forth in Section 207(a)(i) hereof.
 
“ Scheduled Principal Payment Amount ” means, for the Series 2012-1 Notes on each Payment Date, an amount equal to the excess, if any, of (x) the Aggregate Series 2012-1 Note Principal Balance as of such Payment Date (after giving effect to any Minimum Principal Payment Amount actually paid on such Payment Date with respect to the Series 2012-1 Notes but prior to giving effect to any other principal payments scheduled to be paid with respect to the Series 2012-1 Notes on such Payment Date) over (y) the Scheduled Targeted Principal Balance for the Series 2012-1 Notes on such Payment Date.
 
“ Scheduled Targeted Principal Balance ” means, for the Series 2012-1 Notes for each Payment Date, subject to Section 205(c) , the amount set forth opposite such Payment Date on Schedule 1 hereto under the column entitled “Scheduled Targeted Principal Balance”.
 
“ Series 2012-1 ” means the Series of Notes the terms of which are specified in this Supplement.
 
“ Series 2012-1 Expected Final Maturity Date ” means the Payment Date occurring in October 2022.
 
“ Series 2012-1 Legal Final Maturity Date ” means the Payment Date occurring in October 2027.
 
“ Series 2012-1 Note ” means any one of the notes issued pursuant to the terms of Section 201(a) hereof, substantially in the forms of Exhibits A-1, A-2, A-3 and A-4 to this Supplement, and any and all replacements or substitutions of such note.
 
“ Series 2012-1 Note Interest Payment ” means, for each Series 2012-1 Note on each Payment Date, the amount set forth in Section 203(a) hereof (exclusive of any Default Interest).
 
“ Series 2012-1 Note Interest Rate ” means, for each Interest Accrual Period, an interest rate equal to three and forty seven hundredths of one percent (3.47%) per annum.
 
 
3
 
 
“ Series 2012-1 Note Principal Balance ” means, with respect to each Series 2012-1 Note as of any date of determination, an amount equal to the excess of (x) the Series 2012-1 Note Principal Balance of such Series 2012-1 Note as of the Closing Date, over (y) the cumulative amount of all Minimum Principal Payment Amounts, Scheduled Principal Payment Amounts and any other principal payments actually paid to the Holder of such Series 2012-1 Note subsequent to the Closing Date.
 
“ Series 2012-1 Note Purchase Agreement ” means the Series 2012-1 Note Purchase Agreement, dated as of October 11, 2012 (as amended, restated, supplemented or modified from time to time), among the Issuer, Container Applications Limited and the Initial Purchasers.
 
“ Series 2012-1 Noteholder ” means, at any time of determination for the Series 2012-1 Notes, any Person in whose name a Series 2012-1 Note is registered in the Note Register.
 
“ Series 2012-1 Related Documents ”   means any and all of the Indenture, this Supplement, the Series 2012-1 Notes, the Management Agreement, the Contribution and Sale Agreement, the Series 2012-1 Note Purchase Agreement, the Administration Agreement, the Manager Transfer Facilitator Agreement, each Interest Rate Hedge Agreement (upon execution thereof) and any and all other agreements, documents and instruments executed and delivered by or on behalf or in support of the Issuer with respect to the issuance and sale of the Series 2012-1 Notes, as any of the foregoing may from time to time be amended, modified, supplemented or renewed; provided, the term “Series 2012-1 Related Documents” shall not include the Members Agreement.
 
“ Series 2012-1 Series Account ” means the account of that name established in accordance with Section 301 hereof.
 
“ Supplemental Principal Payment Amount ” means, on each Payment Date, the amount of any Prepayment made in accordance with the provisions of Section 702(a) of the Indenture that is allocated to the Series 2012-1 Notes in accordance with such provision of the Indenture.
 
“ Transferor ” shall have the meaning set forth in Section 207(b)(v) hereof.
 
“ Unrestricted Book-Entry Notes ” means the Unrestricted Book-Entry Notes substantially in the form of Exhibit A-3 hereto.
 
“ U.S. Person ” has the meaning set forth in Regulation S.
 
(b)   Capitalized terms used herein and not otherwise defined shall have the meaning set forth in the Indenture or, if not defined therein, as defined in the Series 2012-1 Note Purchase Agreement.
 
(c)   References in this Supplement and any other Series 2012-1 Related Document to any section of the Uniform Commercial Code or the UCC shall mean, on or after the effective date of adoption of any revision to the Uniform Commercial Code or the UCC in the applicable jurisdiction, such revised or successor section thereto.
 
 
4
 
 
ARTICLE II
 
Creation of the Series 2012-1 Notes
 
Section 201.    Designation .
 
(a)     There is hereby created a Series of Notes to be issued in one class pursuant to the Indenture and this Supplement to be known as the “CAL Funding II Limited Fixed Rate Asset-Backed Notes, Series 2012-1” (the “ Series 2012-1 Notes ”).  The Series 2012-1 Notes will be issued in the initial principal balance of One Hundred Seventy-One Million Dollars ($171,000,000).  The issuance date of the Series 2012-1 Notes is October 18, 2012.
 
(b)   The Payment Date with respect to the Series 2012-1 Notes shall be the twenty-fifth (25 th ) calendar day of each month or, if such day is not a Business Day, the immediately following Business Day. The initial Payment Date shall occur on November 26, 2012.
 
(c)   Payments of principal on the Series 2012-1 Notes shall be payable from funds on deposit in the Series 2012-1 Series Account or otherwise at the times and in the amounts set forth in Article III of the Indenture and Article III of this Supplement.
 
(d)   Each Series 2012-1 Note is classified as a “Term Note”, as such term is used in the Indenture.
 
(e)   The “Expected Final Maturity Date” for Series 2012-1, as such term is used in the Indenture, is the Payment Date occurring in October 2022.
 
(f)   All of the Early Amortization Events set forth in Article XII of the Indenture are applicable to Series 2012-1.
 
(g)   The “Related Documents” for Series 2012-1, as such term is used in the Indenture, shall be the Series 2012-1 Related Documents.
 
(h)   The “Rating Agency” for Series 2012-1, as such term is used in the Indenture, shall be Standard & Poor’s.
 
(i)   In the event that any term or provision contained herein shall conflict with or be inconsistent with any term or provision contained in the Indenture, the terms and provisions of this Supplement shall govern.
 
Section 202.       Authentication and Delivery .
 
(a)   On the Closing Date, the Issuer shall sign, and shall direct the Indenture Trustee in writing pursuant to Section 204 of the Indenture to duly authenticate, and the Indenture Trustee, upon receiving such direction, (i) shall authenticate, subject to compliance with the conditions precedent set forth in Section 501 hereof, the Series 2012-1 Notes in accordance with such written directions, and (ii) subject to compliance with the conditions precedent set forth in Section 501 hereof and the conditions precedent set forth in Section 8 of the Series 2012-1 Note Purchase Agreement , shall deliver such Series 2012-1 Notes to the Initial Purchasers and, subject to compliance with the conditions precedent set forth in Section 501 hereof and the conditions precedent set forth in Section 8 of the Series 2012-1 Note Purchase Agreement, shall deliver such Series 2012-1 Notes to the Series 2012-1 Noteholders in accordance with such written directions.
 
 
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(b)   In accordance with Section 202 of the Indenture, the Series 2012-1 Notes sold in reliance on Rule 144A shall be represented by one or more 144A Book-Entry Notes.  Any Series 2012-1 Notes sold in reliance on Regulation S shall be represented by one or more Regulation S Book-Entry Notes.  Any Series 2012-1 Notes sold to Institutional Accredited Investors or other Persons that are not Qualified Institutional Buyers or Permitted Non-U.S. Persons shall be represented by one or more Definitive Notes.
 
(c)   The Series 2012-1 Notes shall be executed by manual or facsimile signature on behalf of Issuer by any officer of Issuer and shall be substantially in the forms of Exhibits A-1, A-2, A-3 and A-4 hereto, as applicable.
 
(d)   The Series 2012-1 Notes shall be issued in minimum denominations of $250,000 and in integral multiples of $1,000 in excess thereof.
 
Section 203.   Interest Payments on the Series 2012-1 Notes .
 
(a)   Interest on Series 2012-1 Notes .  Interest on each Series 2012-1 Note shall (i) accrue during each Interest Accrual Period at the Series 2012-1 Note Interest Rate, (ii) accrue on the basis of 30 days over a year consisting of three hundred sixty (360) days, (iii) be due and payable on each Payment Date, (iv) be calculated based on the then Series 2012-1 Note Principal Balance of such Series 2012-1 Note and (v) be payable from the Series 2012-1 Series Account in accordance with Section 302 hereof (the amount of interest calculated pursuant to this sentence for any Series 2012-1 Note for any Payment Date being the “ Series 2012-1 Note Interest Payment ” with respect to such Series 2012-1 Note and Payment Date).  To the extent that the amount of interest which is due and payable on any Payment Date is not paid in full on such date, such shortfall, together with interest thereon at the Overdue Rate, shall be due and payable on the immediately succeeding Payment Date.
 
(b)       Interest on Overdue Amounts . If the Issuer shall default in the payment of (i) the Series 2012-1 Note Principal Balance of any Series 2012-1 Notes on the Series 2012-1 Legal Final Maturity Date, or (ii) the Series 2012-1 Note Interest Payment on any Series 2012-1 Note on any Payment Date, or (iii) any other amount becoming due under this Supplement, the Issuer shall, from time to time, pay interest on such unpaid amounts, to the extent permitted by Applicable Law, at a rate per annum equal to the Overdue Rate, for the period during which such principal, interest or other amount shall be unpaid from the due date of such payment to but not including the date of actual payment thereof (after as well as before judgment).  Default Interest shall be payable at the times and subject to the priorities set forth in Section 303 hereof.
 
(c)   Maximum Interest Rate . In no event shall the interest charged with respect to a Series 2012-1 Note exceed the maximum amount permitted by Applicable Law.  If at any time the interest rate charged with respect to the Series 2012-1 Notes exceeds the maximum rate permitted by Applicable Law, the rate of interest to accrue pursuant to this Supplement and such Series 2012-1 Note shall be limited to the maximum rate permitted by Applicable Law.  If the total amount of interest paid or accrued on the Series 2012-1 Notes under the foregoing provisions is less than the total amount of interest that would have accrued if the interest rate had at all times been in effect, the Issuer agrees to pay to the Series 2012-1 Noteholders an amount equal to the difference between (a) the lesser of (i) the amount of interest that would have accrued if the maximum rate permitted by Applicable Law had at all times been in effect, or (ii) the amount of interest that would have accrued if the interest rate had at all times been in effect, and (b) the amount of interest accrued in accordance with the other provisions of this Supplement.
 
 
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Section 204.       Principal Payments on the Series 2012-1 Notes .
 
(a)   The principal balance of the Series 2012-1 Notes shall be payable on each Payment Date from amounts on deposit in the Series 2012-1 Series Account in an amount equal to (i) so long as no Early Amortization Event is continuing, the Minimum Principal Payment Amount and the Scheduled Principal Payment Amount for the Series 2012-1 Notes for such Payment Date or (ii) if an Early Amortization Event is then continuing, the then unpaid Aggregate Series 2012-1 Note Principal Balance shall be payable in full to the extent that funds are available for such purposes in accordance with the provisions of clause (4) of Part (II) of Section 303 hereof.  The unpaid principal amount of each Series 2012-1 Note together with all unpaid interest (including all Default Interest), indemnifications, fees, expenses, costs and other amounts payable by the Issuer to the Series 2012-1 Noteholders, the Indenture Trustee and any Interest Rate Hedge Provider pursuant to the terms of the Indenture and this Supplement, shall be due and payable in full on the earlier to occur of (x) the date on which an Event of Default shall occur and the Series 2012-1 Notes have been accelerated in accordance with the provisions of Section 802 of the Indenture and (y) the Series 2012-1 Legal Final Maturity Date.
 
Section 205.   Prepayment of Principal on the Series 2012-1 Notes .
 
(a)   The Aggregate Series 2012-1 Note Principal Balance of the Series 2012-1 Notes shall be required to be prepaid at the time and in the amounts set forth in Section 702(a) of the Indenture.  Such principal prepayments on Series 2012-1 Notes shall be paid on each Payment Date.  In connection with any Prepayment made in accordance with this Section 205(a) , the Issuer shall pay any termination, notional reduction, breakage or other fees or costs assessed by any Interest Rate Hedge Provider.
 
(b)   The Issuer will not be permitted to make a voluntary Prepayment of all, or any portion of, the principal balance of the Series 2012-1 Notes prior to the Payment Date occurring in October 2014.  Nothing contained herein shall prohibit any allocation to the Series 2012-1 Noteholders of Supplemental Principal Payment Amounts in accordance with Section 702(a) of the Indenture on any Payment Date.  On any Payment Date thereafter, the Issuer will have the option to prepay, without premium, on any Payment Date all, or a portion of, the Aggregate Series 2012-1 Note Principal Balance, in a minimum amount of One Hundred Fifty Thousand Dollars ($150,000), together with accrued interest thereon, to be applied to the Series 2012-1 Notes.  The Issuer shall provide prior written notice of any Prepayment to the Indenture Trustee and the Series 2012-1 Noteholders.  Any such Prepayment of the Aggregate Series 2012-1 Note Principal Balance shall also include accrued interest to the date of Prepayment on the principal balance being prepaid.  The Issuer may not make such Prepayment from funds in the Trust Account, the Series 2012-1 Series Account, each Pre-Funding Account or the Restricted Cash Account, except to the extent that funds in any such account would otherwise be payable to the Issuer in accordance with the terms of this Supplement and the Indenture.  In the event of any Prepayment of the Series 2012-1 Notes in accordance with this Section 205(b) or any provision of the Indenture, the Issuer shall simultaneously pay any termination, notional reduction, breakage or other fees or costs assessed by any Interest Rate Hedge Provider.
 
 
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(c)   In the event that the Issuer makes a Prepayment in accordance with the provisions of this Section 205 of less than the Aggregate Series 2012-1 Note Principal Balance, the Issuer shall promptly (but in any event within five (5) Business Days after the date on which such Prepayment is made) thereafter recalculate the Minimum Targeted Principal Balance and Scheduled Targeted Principal Balance for each future Payment Date such that the Minimum Targeted Principal Balance and the Scheduled Targeted Principal Balance is reduced by an amount equal to the quotient of (i) the aggregate amount of the Prepayment for the Series 2012-1 Notes divided by (ii) the number of remaining Payment Dates to and including (A) the Series 2012-1 Legal Final Maturity Date (in the case of the Minimum Targeted Principal Balance) and (B) the Series 2012-1 Expected Final Maturity Date (in the case of the Scheduled Targeted Principal Balance).  In addition, if an Early Amortization Event has occurred and been subsequently cured and/or waived in accordance with the Series 2012-1 Related Documents (the period between such occurrence and such cure or waiver being the “ Accelerated Measurement Period ”), the Minimum Targeted Principal Balance and Scheduled Targeted Principal Balance for each Payment Date following such Accelerated Measurement Period shall be reduced, utilizing a similar methodology, by the amount of payments made pursuant to Section 303(II)(4) or 303(III)(2) , as the case may be, during the Accelerated Measurement Period in excess of the amounts that would have been paid pursuant to Sections 303(I)(2) and (3) were such Accelerated Measurement Period not to have occurred.
 
Section 206.       Payments of Principal and Interest .  All payments of principal and interest on the Series 2012-1 Notes shall be paid to the Series 2012-1 Noteholders reflected in the Note Register as of the related Record Date by wire transfer of immediately available funds for receipt prior to 11:00 a.m. (New York City time) on the related Payment Date.  Any payments received by the Series 2012-1 Noteholders after 11:00 a.m. (New York City time) on any day shall be considered to have been received on the next succeeding Business Day.
 
Section 207.       Restrictions on Transfer .
 
(a)   On the Closing Date, the Issuer shall sell the Series 2012-1 Notes to the Initial Purchasers pursuant to the Series 2012-1 Note Purchase Agreement and deliver such Series 2012-1 Notes in accordance herewith and therewith.  Thereafter, no Series 2012-1 Note may be resold, pledged or transferred except in compliance with the provisions of the Indenture and except as follows:
 
(i)       to Persons that take delivery of such Series 2012-1 Note in an amount of at least $250,000 and that the transferring Person reasonably believes are qualified institutional buyers as defined in Rule 144A (“ Qualified Institutional Buyers ”)   in reliance on the exemption from the registration requirements of the Securities Act provided by Rule 144A promulgated thereunder (“ Rule 144A ”);
 
 
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(ii)      to Permitted Non-U.S. Persons that take delivery of such Series 2012-1 Note in an amount of at least $250,000;
 
(iii)     to Institutional Accredited Investors that take delivery of such Series 2012-1 Note in an amount of at least $250,000 and that deliver to the Indenture Trustee a letter substantially in the form of Exhibit E   to this Supplement to the Indenture Trustee; or
 
(iv)     to a Person that is taking delivery of such Series 2012-1 Note in an amount of at least $250,000 and that is otherwise exempt from the registration requirements of the Securities Act and from any applicable State law securities registration or qualification requirements, as confirmed in an Opinion of Counsel addressed to the Indenture Trustee and the Issuer, which counsel and opinion are satisfactory to the Indenture Trustee and the Issuer.
 
(b)      The Indenture Trustee shall have no obligations or duties with respect to determining whether any transfers of the Series 2012-1 Notes are made in accordance with the Securities Act or any other law; provided that with respect to Definitive Notes, the Indenture Trustee shall enforce such transfer restrictions in accordance with the terms set forth in this Supplement.
 
(c)   Each purchaser (other than the Initial Purchasers) of the Series 2012-1 Notes (including any purchaser, other than the Initial Purchasers, of an interest in the Series 2012-1 Notes which are Book-Entry Notes) shall be deemed to have acknowledged and agreed as follows:
 
(i)       It is (A) a Qualified Institutional Buyer and is acquiring such Series 2012-1 Notes for its own institutional account or for the account or accounts of a Qualified Institutional Buyer or (B) purchasing such Series 2012-1 Notes in a transaction exempt from registration under the Securities Act and in compliance with the provisions of this Supplement and in compliance with the legend set forth in Section 207(b)(v) below or (C) not a U.S. Person and is acquiring such Series 2012-1 Notes outside of the United States.
 
(ii)   It is purchasing one or more Series 2012-1 Notes in an amount of at least $250,000 and it understands that such Series 2012-1 Notes may be resold, pledged or otherwise transferred only in an amount of at least $250,000.
 
 
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(iii)   It represents and warrants to the Issuer, the Indenture Trustee, the Initial Purchasers, the Manager and any successor Manager that (a) either (1) it is not, and is not acting on behalf of, a Plan or a governmental, church or non-U.S. plan which is subject to any federal, state, local, or non-U.S. law that is similar to the prohibited transaction provisions of Section 406 of ERISA or Section 4975 of the Code, and no part of the assets to be used by it to purchase or hold the Series 2012-1 Notes or any interest therein constitutes the assets of any Plan or such a governmental, church, or non-U.S. plan; or (2) (A) the acquisition, holding, and disposition of any Series 2012-1 Note will not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or, in the case of a governmental, church, or non-U.S. plan, a violation of any similar federal, state, local, or non-U.S. law) and (B) the Series 2012-1 Notes are rated investment grade or better and such Person believes that the Series 2012-1 Notes are properly treated as indebtedness without substantial equity features for purposes of Section 2510.3-101 of the regulations issued by the U.S. Department of Labor, and agrees to so treat the Series 2012-1 Notes; and (b) it will not sell or otherwise transfer the Series 2012-1 Notes or any interest therein otherwise than to a purchaser or transferee that represents and agrees with respect to its purchase, holding, and disposition of the Series 2012-1 Notes to the same effect as the purchaser’s representation and agreement set forth in this Section 207(b)(ii) .  Alternatively, regardless of the rating of the Series 2012-1 Notes, such Person may provide the Indenture Trustee with an Opinion of Counsel, which Opinion of Counsel will not be at the expense of the Issuer, the Indenture Trustee, the Manager or any successor Manager which opines that the purchase, holding and transfer of such Series 2012-1 Notes or interest therein is permissible under applicable law, will not constitute or result in a non exempt prohibited transaction under ERISA or Section 4975 of the Code and will not subject the Issuer, the Indenture Trustee, the Manager or any successor Manager to any obligation in addition to those undertaken in the Indenture;
 
(iv)   It understands that the Series 2012-1 Notes are being transferred to it in a transaction not involving any public offering within the meaning of the Securities Act, and that, if in the future it decides to resell, pledge or otherwise transfer any Series 2012-1 Notes, such Series 2012-1 Notes may be resold, pledged or transferred only in accordance with applicable state securities laws and (1) in a transaction meeting the requirements of Rule 144A, to a Person that the seller reasonably believes is a Qualified Institutional Buyer that purchases for its own account (or for the account or accounts of a Qualified Institutional Buyer) and to whom notice is given that the resale, pledge or transfer is being made in reliance on Rule 144A, or (2) (A) to a Person that is an Institutional Accredited Investor, is taking delivery of such Series 2012-1 Notes in an amount of at least $250,000, and delivers to the Indenture Trustee a letter substantially in the form of Exhibit E   to this Supplement or (B) to a Person that is taking delivery of such Series 2012-1 Notes pursuant to a transaction that is otherwise exempt from the registration requirements of the Securities Act and from any applicable state law securities registration or qualification requirements, as confirmed in an Opinion of Counsel addressed to the Indenture Trustee, the Issuer and the transferor, which counsel and Opinion are satisfactory to the Indenture Trustee, the Issuer and the transferor, or (3) in an offshore transaction in accordance with Rule 903 or 904 of Regulation S.
 
(v)   It understands that each Series 2012-1 Note shall bear a legend substantially to the following effect:
 
[For Book-Entry Notes Only:  UNLESS THIS SERIES 2012-1 NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ( “ DTC ” ), TO THE TRANSFEROR OF SUCH NOTE (THE “ TRANSFEROR ” ) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SERIES 2012-1 NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR THE USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. ]
 
 
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THIS SERIES 2012-1 NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ SECURITIES ACT ” ).  THE HOLDER HEREOF, BY PURCHASING THIS SERIES 2012-1 NOTE, AGREES THAT SUCH SERIES 2012-1 NOTE MAY BE RESOLD, PLEDGED OR TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND (1) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT ( “ RULE 144A ” ), TO A PERSON THAT TAKES DELIVERY OF SUCH SERIES 2012-1 NOTE IN AN AMOUNT OF AT LEAST $250,000 AND THAT THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT (OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED INSTITUTIONAL BUYER) AND TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT WITH SUCH SERIES 2012-1 NOTE IN AN AMOUNT OF AT LEAST $250,000 OR (3) TO A PERSON (A) THAT IS AN INSTITUTIONAL “ ACCREDITED INVESTOR, ” WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT, IS TAKING DELIVERY OF SUCH SERIES 2012-1 NOTE IN AN AMOUNT OF AT LEAST $250,000 AND DELIVERS TO THE INDENTURE TRUSTEE A LETTER SUBSTANTIALLY IN THE FORM OF EXHIBIT E TO THE SUPPLEMENT OR (B) THAT IS TAKING DELIVERY OF SUCH SERIES 2012-1 NOTE IN AN AMOUNT OF AT LEAST $250,000 PURSUANT TO A TRANSACTION THAT IS OTHERWISE EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND FROM ANY APPLICABLE STATE LAW SECURITIES REGISTRATION OR QUALIFICATION REQUIREMENTS, AS CONFIRMED IN AN OPINION OF COUNSEL ADDRESSED TO THE INDENTURE TRUSTEE AND THE ISSUER, WHICH COUNSEL AND OPINION ARE SATISFACTORY TO THE ISSUER AND THE INDENTURE TRUSTEE.
 
EACH PURCHASER OF A SERIES 2012-1 NOTE SHALL BE DEEMED TO REPRESENT AND WARRANT TO THE INITIAL PURCHASERS, THE ISSUER, THE INDENTURE TRUSTEE AND THE MANAGER THAT (I) EITHER (1) IT IS NOT ACQUIRING THE SERIES 2012-1 NOTE WITH THE ASSETS OF A PLAN; OR (2) (A) THE ACQUISITION AND HOLDING OF THE SERIES 2012-1 NOTE WILL NOT GIVE RISE TO A NONEXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE  AND (B) THE SERIES 2012-1 NOTE IS RATED INVESTMENT GRADE OR BETTER AND SUCH PERSON BELIEVES THAT THE SERIES 2012-1 NOTE IS PROPERLY TREATED AS INDEBTEDNESS WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE DEPARTMENT OF LABOR REGULATIONS SECTION 2510.101, AND AGREES TO SO TREAT THE SERIES 2012-1 NOTE; AND (II) IT WILL NOT SELL OR OTHERWISE TRANSFER THE SERIES 2012-1 NOTES OR ANY INTEREST THEREIN OTHERWISE THAN TO A PURCHASER OR TRANSFEREE THAT REPRESENTS AND AGREES WITH RESPECT TO ITS PURCHASE, HOLDING, AND DISPOSITION OF THE SERIES 2012-1 NOTES TO THE SAME EFFECT AS THE PURCHASER’S REPRESENTATION AND AGREEMENT SET FORTH IN CLAUSE (I) OF THIS PARAGRAPH.
 
THIS SERIES 2012-1 NOTE IS NOT GUARANTEED OR INSURED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
 
 
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(vi)   Each Series 2012-1 Noteholder that is a Permitted Non-U.S. Person described in Section 207(b)(i)(C) understands that the Series 2012-1 Notes have not and will not be registered under the Securities Act, that any offers, sales or deliveries of the Series 2012-1 Notes purchased by it in the United States or to U.S. Persons prior to the date that is 40 days after the later of (i) the commencement of the distribution of the Series 2012-1 Notes and (ii) the Closing Date, may constitute a violation of United States law, and that distributions of principal and interest will be made in respect of such Series 2012-1 Notes only following the delivery by the holder of a certification of non-U.S. beneficial ownership or the exchange of beneficial interest in Regulation S Temporary Book-Entry Notes for beneficial interests in the related Unrestricted Book-Entry Notes (which in each case will itself require a certification of non-U.S. beneficial ownership), at the times and in the manner set forth in this Supplement.
 
(vii)   The Regulation S Temporary Book-Entry Notes representing the Series 2012-1 Notes sold to each Series 2012-1 Noteholder that is a Permitted Non-U.S. Person described in Section 207(b)(i)(C) will bear a legend to the following effect, unless the Issuer determines otherwise consistent with Applicable Law:
 
[FOR REGULATION S BOOK-ENTRY NOTES ONLY:  THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ SECURITIES ACT ” ) AND, PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE LATER OF (I) THE COMPLETION OF THE DISTRIBUTION OF THE SERIES 2012-1 NOTES AND (II) THE CLOSING DATE, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE UNITED STATES OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.]
 
(viii)  The Indenture Trustee shall not permit the transfer of any Series 2012-1 Notes unless such transfer complies with the terms of the foregoing legends and, in the case of a transfer (i) to an Institutional Accredited Investor (other than a Qualified Institutional Buyer), the transferee delivers to the Indenture Trustee a letter substantially in the form of Exhibit E   to this Supplement, or (ii) to a Person other than a Qualified Institutional Buyer, an Institutional Accredited Investor or a Permitted Non-U.S. Person, upon delivery of an Opinion of Counsel satisfactory to the Indenture Trustee and the applicable transferor, to the effect that the transferee is taking delivery of the Series 2012-1 Notes in a transaction that is otherwise exempt from the registration requirements of the Securities Act and from any applicable state law securities registration or qualification requirements.
 
(d)   The applicable transferor and transferee shall execute and deliver, or in the case of a Note Owner, is deemed to have executed and delivered, to the Indenture Trustee documentation in substantially the forms of Exhibit(s) B through F , as appropriate, in connection with any transfer of Series 2012-1 Notes.
 
ARTICLE III
 
Series 2012-1 Series Account and
Allocation and Application of Amounts Therein
 
Section 301.   Series 2012-1 Series Account .  The Indenture Trustee shall establish on or prior to the Closing Date and maintain, so long as any Series 2012-1 Note is Outstanding, an Eligible Account which shall be designated as the Series 2012-1 Series Account, which account shall be held in the name of the Indenture Trustee (and with respect to any investments in such account, in its capacity as Securities Intermediary of the Indenture Trustee) for the benefit of the Series 2012-1 Noteholders, pursuant to the Indenture and this Supplement.  In furtherance of the Grant set forth in the Indenture, the Issuer hereby Grants to the Indenture Trustee for the benefit of the Series 2012-1 Noteholders, among other things, a Lien on the Series 2012-1 Series Account.  All deposits of funds by or for the benefit of the Series 2012-1 Noteholders from the Trust Account, each Pre-Funding Account and the Restricted Cash Account shall be accumulated in, and withdrawn from, the Series 2012-1 Series Account in accordance with the provisions of the Indenture and this Supplement.
 
 
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Section 302.       Drawing Funds from the Restricted Cash Account .
 
(a)   In the event that the Manager Report with respect to any Determination Date shall state that the funds on deposit in the Series 2012-1 Series Account will not be sufficient to make payment in full on the related Payment Date of the related Interest Payment then due for the Series 2012-1 Notes (the amount of such deficiency, the “ Permitted Interest Withdrawal ”), then the Indenture Trustee shall on such Determination Date draw on the Restricted Cash Account in an amount equal to the lesser of (x) the Permitted Interest Withdrawal and (y) the amount then on deposit in the Restricted Cash Account.
 
(b)   In the event that the Manager Report delivered with respect to the Determination Date immediately preceding the Series 2012-1 Legal Final Maturity Date shall state that (or the Administrative Agent shall, pursuant to Section 302(c) of the Indenture, determine that) the funds on deposit in the Series 2012-1 Series Account will not be sufficient to make payment in full on the Series 2012-1 Legal Final Maturity Date of the then Aggregate Series 2012-1 Note Principal Balance (the amount of such deficiency, the “ Permitted Principal Withdrawal ”), then the Indenture Trustee shall on such Determination Date draw on the Restricted Cash Account in an amount equal to the least of (w) the Aggregate Series 2012-1 Note Principal Balance, (x) the Permitted Principal Withdrawal, (y) the Maximum Principal Withdrawal Amount, as calculated for Series 2012-1 and (z) the amount then on deposit in the Restricted Cash Account.
 
(c)   Drawings will be made pursuant to Section 302(a) before any drawing is made on such date pursuant to Section 302(b) , and notice of each such drawing will be delivered to the Manager, by hand delivery or facsimile transmission.  Any such funds actually received by the Indenture Trustee pursuant to Section 302(a) or Section 302(b) shall be used solely to make payments of the Series 2012-1 Note Interest Payment or the Aggregate Series 2012-1 Note Principal Balance, as the case may be.
 
Section 303.       Distributions from Series 2012-1 Series Account .  On each Payment Date, the Indenture Trustee shall distribute funds then on deposit in the Series 2012-1 Series Account in accordance with the provisions of Section 303(I), (II) or (III) .
 
(I)        If neither an Early Amortization Event nor an Event of Default shall have occurred and be continuing with respect to any Series of Notes:
 
 
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(1)      To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to its pro rata portion of the Series 2012-1 Note Interest Payment for each such Payment Date;
 
(2)      To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to its pro rata portion of the Minimum Principal Payment Amount then due and payable to the Holders of a Series 2012-1 Note on such Payment Date;
 
(3)      To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to its pro rata portion of the Scheduled Principal Payment Amount then due and payable to the Holders of a Series 2012-1 Note on such Payment Date;
 
(4)    To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to its pro rata portion (if any) of the Supplemental Principal Payment Amount then due and payable to the Holders of a Series 2012-1 Note on such Payment Date;
 
(5)      To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, pro rata (based on respective amounts due), an amount equal to all taxes, increased costs, indemnities and other amounts (including Default Interest) then due and payable by the Issuer to the Series 2012-1 Noteholders pursuant to the Series 2012-1 Related Documents; and
 
(6)      To the Issuer, any remaining amounts then on deposit in the Series 2012-1 Series Account.
 
(II)   If an Early Amortization Event shall have occurred and be continuing with respect to any Series but no Event of Default shall have occurred and be continuing with respect to any Series:
 
(1)     To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to its pro rata portion of the Series 2012-1 Note Interest Payment for each such Payment Date;
 
(2)      To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to its pro rata portion of the Minimum Principal Payment Amount then due and payable to the Holders of a Series 2012-1 Note on such Payment Date;
 
(3)      To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to its pro rata portion of the Scheduled Principal Payment Amount then due and payable to the Holders of a Series 2012-1 Note on such Payment Date;
 
(4)      To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to its pro rata portion of the then Aggregate Series 2012-1 Note Principal Balance until the Aggregate Series 2012-1 Note Principal Balance has been reduced to zero;
 
 
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(5)     To each Holder of a Series 2012-1 Note on the immediately preceding Record Date, pro rata (based on respective amounts due), an amount equal to all taxes, increased costs, indemnities and other amounts (including Default Interest) then due and payable by the Issuer to the Series 2012-1 Noteholders pursuant to the Series 2012-1 Related Documents; and
 
(6)     To the Issuer, any  remaining amounts then on deposit in the Series 2012-1 Series Account.
 
(III)     If an Event of Default shall have occurred and be continuing with respect to any Series:
 
(1)     To each Holder of a Series 2012-1 Note on the immediately preceding Record Date an amount equal to its pro rata portion of the Series 2012-1 Note Interest Payment then due and payable for such Payment Date;
 
(2)     To each Holder of a Series 2012-1 Note on the immediately preceding Record Date on a pro rata basis, an amount equal to the Aggregate Series 2012-1 Note Principal Balance until the Aggregate Series 2012-1 Note Principal Balance has been reduced to zero;
 
(3)     To the following Persons on a pro rata basis, to each Holder of a Series 2012-1 Note on the immediately preceding Record Date, an amount equal to all taxes, increased costs, indemnities and other amounts (including Default Interest); and
 
(4)     To the Issuer, any remaining amounts then on deposit in the Series 2012-1 Series Account.
 
(IV)     Any amounts payable to a Series 2012-1 Noteholder shall be made by wire transfer of immediately available funds to the account that such Series 2012-1 Noteholder has designated to the Indenture Trustee in writing on or prior to the Business Day immediately preceding the Payment Date.
 
ARTICLE IV
Additional Covenants
 
In addition to the covenants set forth in Article VI of the Indenture, the Issuer hereby makes the following additional covenants for the benefit of the Series 2012-1 Noteholders:
 
Section 401.       Rule 144A .  So long as any of the Series 2012-1 Notes are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, Issuer shall, unless it becomes subject to and complies with the reporting requirements of Section 13 or 15(d) of the Exchange Act, or rule 12g3-2(b) thereunder, (i) provide to any Series 2012-1 Noteholder of such restricted securities, or to any prospective Series 2012-1 Noteholder of such restricted securities designated by a Series 2012-1 Noteholder, upon the request of such Series 2012-1 Noteholder or prospective Series 2012-1 Noteholder, any information required to be provided by Rule 144A(d)(4) under the Securities Act and (ii) update such information to prevent such information from becoming materially false and materially misleading in a manner adverse to any Series 2012-1 Noteholder.
 
 
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Section 402.   Use of Proceeds .  The proceeds from the issuance of the Series 2012-1 Notes shall be used as follows:  (i) to pay the costs of issuance of the Series 2012-1 Notes and (ii) for other general corporate purposes, as contemplated in Section 624 of the Indenture.
 
Section 403.   Perfection Requirements .  The Issuer will not (a) change any of (i) its corporate name or (ii) the name under which it does business or (b) amend any provision of its memorandum of association or bye-laws or become organized under the laws of any other jurisdiction without the prior written consent of the Control Party for Series 2012-1.
 
Section 404.   United States Federal Income Tax Election .  The Issuer shall not make an election to be classified as an association taxable as a corporation pursuant to Section 301.7701-3 of the United States Treasury Regulations.
 
Section 405.   OFAC Matters .  The Issuer shall not in any manner which would violate the laws of the United States, other than pursuant to a license issued by OFAC (i) lease, or consent to any sublease of, any of the Containers to any Person that is a Prohibited Person or (ii) derive any of its assets or operating income from investments in or transactions with any such Prohibited Person.  If the Issuer obtains knowledge that a Container is subleased to a Prohibited Person or located or used in a Prohibited Jurisdiction in a manner which would violate the laws of the United States (other than pursuant to a license issued by OFAC), then the Issuer shall, within ten (10) Business Days after obtaining knowledge thereof, remove such Container from the Asset Base for so long as such condition continues.
 
ARTICLE V
Conditions to Issuance
 
Section 501.       Conditions to Issuance .  The Indenture Trustee shall not authenticate the Series 2012-1 Notes unless (i) all conditions to the issuance and purchase of the Series 2012-1 Notes under the Series 2012-1 Note Purchase Agreement shall have been satisfied, and (ii) the Issuer shall have delivered a certificate to the Indenture Trustee to the effect that all conditions set forth in the Series 2012-1 Note Purchase Agreement shall have been satisfied.
 
ARTICLE VI
 
Representations and Warranties
 
To induce the Series 2012-1 Noteholders to purchase the Series 2012-1 Notes hereunder, the Issuer hereby represents and warrants as of the Closing Date to the Indenture Trustee for the benefit of the Series 2012-1 Noteholders that:
 
Section 601.       Existence .  Issuer is a company duly incorporated, validly existing and in compliance under the laws of Bermuda.  Issuer is in good standing and is duly qualified to do business in each jurisdiction where the failure to do so would have a material adverse effect upon the Issuer and in each jurisdiction in which a failure to so qualify would materially and adversely affect the ability of the Indenture Trustee to enforce its security interest in the Collateral.
 
 
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Section 602.       Authorization .  Issuer has the power and is duly authorized to execute and deliver this Supplement and the other Series 2012-1 Related Documents to which it is a party; Issuer is and will continue to be duly authorized to borrow monies hereunder; and Issuer is and will continue to be authorized to perform its obligations under this Supplement and under the other Series 2012-1 Related Documents.  The execution, delivery and performance by Issuer of this Supplement and the other Series 2012-1 Related Documents to which it is a party and the borrowings hereunder do not and will not require any consent or approval of any Governmental Authority, shareholder or any other Person which has not already been obtained.
 
Section 603.   No Conflict; Legal Compliance .  The execution, delivery and performance of this Supplement and each of the other Series 2012-1 Related Documents and the execution, delivery and payment of the Series 2012-1 Notes will not: (a) contravene any provision of the Issuer’s bye-laws or memorandum of association; (b) contravene, conflict with or violate any Applicable Law or regulation, or any order, writ, judgment, injunction, decree, determination or award of any Governmental Authority; or (c) violate or result in the breach of, or constitute a default under the Indenture, the Series 2012-1 Related Documents, any other indenture or other loan or credit agreement, or other agreement or instrument to which Issuer is a party or by which Issuer, or its property and assets may be bound or affected. Issuer is not in violation or breach of or default under any law, rule, regulation, order, writ, judgment, injunction, decree, determination or award or any contract, agreement, lease, license, indenture or other instrument to which it is a party.
 
Section 604.      Validity and Binding Effect .  This Supplement is, and each Series 2012-1 Related Document to which Issuer is a party, when duly executed and delivered, will be, the legal, valid and binding obligation of Issuer, enforceable against Issuer in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or by general principles of equity limiting the availability of equitable remedies.
 
Section 605.   Financial Statements .   Since December 31, 2011, there has been no Material Adverse Change in the financial condition of any of the Issuer, the Seller or the Manager.
 
Section 606.       Place of Business .  The Issuer’s only “place of business” (within the meaning of Section 9-307 of the UCC) is located at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda.  The Issuer does not maintain an office or assets in the United States, other than (i) the Trust Account, the Restricted Cash Account, each Pre-Funding Account and the Series Accounts and (ii) off-hire containers located in depots in the United States and Managed Containers described in Section 606(g) of the Indenture and Leases pursuant to Section 3.6 of the Management Agreement.
 
 
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Section 607.   No Agreements or Contracts .  The Issuer is not a party to any contract or agreement (whether written or oral) other than the Series 2012-1 Related Documents (as such term is defined in the Supplement for Series 2012-1).
 
Section 608.   Consents and Approvals .  No approval, authorization or consent of any trustee or holder of any Indebtedness or obligation of Issuer or of any other Person under any agreement, contract, lease or license or similar document or instrument to which Issuer is a party or by which Issuer is bound, is required to be obtained by Issuer in order to make or consummate the transactions contemplated under the Series 2012-1 Related Documents, except for those approvals, authorizations and consents that have been obtained on or prior to the Closing Date.  All consents and approvals of, filings and registrations with, and other actions in respect of, all Governmental Authorities required to be obtained by Issuer in order to make or consummate the transactions contemplated under the Series 2012-1 Related Documents have been, or prior to the time when required will have been, obtained, given, filed or taken and are or will be in full force and effect.
 
Section 609.   Margin Regulations .  Issuer does not own any “margin security”, as that term is defined in Regulation U of the Federal Reserve Board, and the proceeds of the Series 2012-1 Notes issued under this Supplement will be used only for the purposes contemplated hereunder. None of such proceeds will be used, directly or indirectly, for the purpose of purchasing or carrying any margin security, for the purpose of reducing or retiring any indebtedness which was originally incurred to purchase or carry any margin security or for any other purpose which might cause any of the loans under this Supplement to be considered a “purpose credit” within the meaning of Regulations T, U and X.  Issuer will not take or permit any agent acting on its behalf to take any action which might cause this Supplement or any document or instrument delivered pursuant hereto to violate any regulation of the Federal Reserve Board.
 
Section 610.   Taxes .  All federal, state, local and foreign tax returns, reports and statements required to be filed by Issuer have been filed with the appropriate Governmental Authorities, and all taxes and other impositions shown thereon to be due and payable by Issuer have been paid prior to the date on which any fine, penalty, interest or late charge may be added thereto for nonpayment thereof, or any such fine, penalty, interest, late charge or loss has been paid, or Issuer is contesting its liability therefor in good faith and has fully reserved all such amounts according to GAAP in the financial statements provided to the Noteholders pursuant to Section 626 of the Indenture.  Issuer has paid when due and payable all material charges upon the books of Issuer and no Governmental Authority has asserted any Lien against Issuer with respect to unpaid taxes. Proper and accurate amounts have been withheld by Issuer from its employees for all periods in full and complete compliance with the tax, social security and unemployment withholding provisions of applicable federal, state, local and foreign law and such withholdings have been timely paid to the respective Governmental Authorities.
 
Section 611.   Other Regulations .  Issuer is not an “investment company,” or an “affiliated person” of, or a “promoter” or “principal underwriter” for, an “investment company,” as such terms are defined in the Investment Company Act of 1940, as amended.  The issuance of the Series 2012-1 Notes hereunder and the application of the proceeds and repayment thereof by Issuer and the performance of the transactions contemplated by this Supplement and the other Series 2012-1 Related Documents will not violate any provision of the Investment Company Act, or any rule, regulation or order issued by the SEC thereunder.
 
 
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Section 612.   Solvency and Separateness .
 
(a)   The capital of the Issuer is adequate for the business and undertakings of the Issuer.
 
(b)   Other than with respect to the transactions contemplated hereby and by the Series 2011-1 Related Documents, the Series 2012-1 Related Documents and the Related Documents, the Issuer is not engaged in any business transactions with the Seller or the Manager, except as permitted by the Management Agreement and the Contribution and Sale Agreement.
 
(c)   The bye-laws of the Issuer provide that the Issuer shall have three directors of which one director shall be an Independent Director (as defined in such bye-laws).  No action can be taken to institute voluntary Insolvency Proceedings on behalf of the Issuer unless such action shall have been approved or authorized by (x) all of the Directors (which approval shall include the Independent Director) and  (y) a resolution of the Members of the Issuer representing one hundred percent (100%) of all shares of the Issuer then issued and outstanding.
 
(d)   The Issuer’s funds and assets are not, and will not be, commingled with those of the Seller or the Manager, except as permitted by the Management Agreement.
 
(e)   The bye-laws of the Issuer require it to maintain correct and complete books and records of account, and Bermuda law requires it to maintain minutes of the meetings and other proceedings of its members.
 
(f)   The Issuer is not insolvent under the Insolvency Law and will not be rendered insolvent by the transactions contemplated by the Series 2012-1 Related Documents and after giving effect to such transactions, the Issuer will not be left with an unreasonably small amount of capital with which to engage in its business nor will the Issuer have intended to incur, or believe that it has incurred, debts beyond its ability to pay such debts as they mature.  The Issuer does not contemplate the commencement of insolvency, bankruptcy, liquidation or consolidation proceedings or the appointment of a receiver, liquidator, trustee or similar official in respect of the Issuer or any of its assets.
 
Section 613.      Title; Liens .  On the Closing Date, the Issuer will have good, legal, and marketable title to each of its respective assets, and none of such assets is subject to any Lien, except for Permitted Encumbrances.
 
Section 614.   No Default .  No Event of Default or Early Amortization Event (or event or condition which with the giving of notice or passage of time or both would become an Event of Default or Early Amortization Event) has occurred and is continuing.
 
Section 615.   Litigation and Contingent Liabilities .  No claims, litigation, arbitration proceedings or governmental Proceedings by any Governmental Authority are pending or threatened against or are affecting the Issuer or any of its Affiliates the results of which might interfere with the consummation of any of the transactions contemplated by this Supplement or any document issued or delivered in connection herewith.
 
 
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Section 616.   Subsidiaries .  Issuer has no Subsidiaries.
 
Section 617.   No Partnership .  Issuer is not a partner or joint venturer in any partnership or joint venture.
 
Section 618.   Pension and Welfare Plans .  No accumulated funding deficiency (as defined in Section 412 of the Code or Section 302 of ERISA) or reportable event (within the meaning of section 4043 of ERISA), has occurred with respect to any Plan of the Issuer or any ERISA Affiliate.  The present value of all benefit liabilities under all Plans of the Issuer or any ERISA Affiliate subject to Title IV of ERISA, as defined in Section 4001(a)(16) of ERISA, exceeds the fair market value of all assets of Plans subject to Title IV of ERISA (determined as of the most recent valuation date for such Plan on the basis of assumptions prescribed by the Pension Benefit Guaranty Corporation for the purpose of Section 4044 of ERISA), by no more than $1.9 million.  Neither Issuer nor any ERISA Affiliate is subject to any present or potential withdrawal liability pursuant to Title IV of ERISA and no multi-employer plan (within the meaning of Section 4001(a)(3) of ERISA) to which the Issuer or any ERISA Affiliate has an obligation to contribute or any liability, is or is likely to be disqualified for tax purposes, in reorganization within the meaning of Section 4241 of ERISA or Section 418 of the Code) or is insolvent (as defined in Section 4245 of ERISA).  No liability (other than liability to make periodic contributions to fund benefits) with respect to any Plan of Issuer, or Plan subject to Title IV of ERISA or any ERISA Affiliate, has been, or is expected to be, incurred by Issuer or an ERISA Affiliate, either directly or indirectly.  All Plans of Issuer are in material compliance with ERISA and the Code.  No lien under Section 412 of the Code or 302(f) of ERISA or requirement to provide security under the Code or ERISA has been or is reasonably expected by Issuer to be imposed on its assets.  The Issuer does not have any obligation under any collective bargaining agreement.  As of the Closing Date, the Issuer is not an employee benefit plan within the meaning of ERISA or a “plan” within the meaning of Section 4975 of the Code and assets of the Issuer do not constitute “plan assets” within the meaning of Section 2510.3-101 of the regulations of the Department of Labor.
 
Section 619.      Ownership of Issuer .  As of the Closing Date, all of the shares of the Issuer are owned by Container Applications Limited, a company organized under the laws of Barbados.
 
Section 620.   Security Interest Representations .
 
(a)   This Supplement and the Indenture create a valid and continuing security interest (as defined in the UCC) in the Collateral in favor of the Indenture Trustee, for the benefit of the Series 2012-1 Noteholders and any Interest Rate Hedge Provider, which security interest is prior to all other Liens (other than Permitted Encumbrances), and is enforceable as such as against creditors of and purchasers from the Issuer.
 
 
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(b)   The Managed Containers constitute “goods” or “inventory” within the meaning of the applicable UCC.  The Leases constitute “tangible chattel paper” within the meaning of the UCC.  The lease receivables constitute “accounts” or “proceeds” of the Leases within the meaning of the UCC.  The Trust Account, the Restricted Cash Account, each Pre-Funding Account and the Series 2012-1 Series Account constitute “securities accounts” within the meaning of the UCC.  The Issuer’s contractual rights under any Interest Rate Hedge Agreements, the Contribution and Sale Agreement and the Management Agreement constitute “general intangibles” within the meaning of the UCC.
 
(c)   The Issuer owns and has good and marketable title to the Collateral, free and clear of any Lien (whether senior, junior or pari passu), claim or encumbrance of any Person, except for Permitted Encumbrances.
 
(d)   The Issuer has caused the filing of all appropriate financing statements or documents of similar import in the proper filing office in the appropriate jurisdictions under Applicable Law in order to perfect the security interest in the Collateral granted to the Indenture Trustee in this Supplement and the Indenture.  All financing statements filed against the Issuer in favor of the Indenture Trustee in connection herewith describing the Collateral contain a statement to the following effect: “A purchase of or security interest in any collateral described in this financing statement will violate the rights of the Indenture Trustee.”
 
(e)   Other than the security interest granted to the Indenture Trustee pursuant to this Supplement and the Indenture, the Issuer has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed any of the Collateral, except as permitted pursuant to the Indenture.  The Issuer has not authorized the filing of, and is not aware of, any financing statements against the Issuer that include a description of collateral covering the Collateral other than any financing statement or document of similar import (i) relating to the security interest granted to the Indenture Trustee in this Supplement or the Indenture or (ii) that has been terminated.  The Issuer is not aware of any judgment or tax lien filings against the Issuer.
 
(f)   The Issuer has received a written acknowledgment from the Manager that the Manager or an Affiliate thereof is holding the Leases, to the extent they relate to the Managed Containers, on behalf of, and for the benefit of, the Indenture Trustee.  None of the Leases that constitute or evidence the Collateral have any marks or notations indicating that they have been pledged, assigned or otherwise conveyed to any Person.  The Seller has caused the filing of all appropriate financing statements or documents of similar import in the proper filing office in the appropriate jurisdictions under Applicable Law in order to perfect the security interest of the Issuer (and the Indenture Trustee as its assignee) in the Leases (to the extent that such Leases relate to the Managed Containers) granted to the Issuer in the Contribution and Sale Agreement.
 
(g)   The Issuer has received all necessary consents and approvals required by the terms of the Collateral to the pledge to the Indenture Trustee of its interest and rights in such Collateral hereunder or under the Indenture.
 
(h)   The Issuer has taken all steps necessary to cause Wells Fargo Bank, National Association (in its capacity as securities intermediary) to identify in its records the Indenture Trustee as the Person having a Securities Entitlement in each of the Trust Account, the Restricted Cash Account, each Pre-Funding Account and the Series 2012-1 Series Account.
 
 
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(i)   The Trust Account, the Restricted Cash Account, each Pre-Funding Account and Series 2012-1 Series Account are not in the name of any Person other than the Indenture Trustee.  The Issuer has not consented to Wells Fargo Bank, National Association (as the Securities Intermediary of the Trust Account, the Restricted Cash Account, each Pre-Funding Account and the Series 2012-1 Series Account) entering into any agreement in which it has agreed to comply with entitlement orders of any Person other than the Indenture Trustee.
 
(j)       No creditor of the Issuer (other than (x) with respect to the Managed Containers, the related Lessee and (y) the Manager in its capacity as Manager under the Management Agreement) has in its possession any goods that constitute or evidence the Collateral.
 
(k)   Any breaches of the representations and warranties set forth in this Section 620 may be waived by the Indenture Trustee, only with the prior written consent of the Control Party for Series 2012-1 and with the prior satisfaction of the Rating Agency Condition.
 
Section 621.       ERISA Lien .  As of the Closing Date, the Issuer has not received notice that any Lien arising under ERISA has been filed against the assets of the Issuer.
 
Section 622.   Survival of Representations and Warranties .  So long as any of the Series 2012-1 Notes shall be Outstanding, the representations and warranties contained herein shall have a continuing effect as having been true when made.
 
ARTICLE VII
 
Miscellaneous Provisions
 
Section 701.   Ratification of Indenture .  As supplemented by this Supplement, the Indenture is in all respects ratified and confirmed and the Indenture as so supplemented by this Supplement shall be read, taken and construed as one and the same instrument.
 
Section 702.      Counterparts .  This Supplement may be executed in two or more counterparts, and by different parties on separate counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument.  Delivery of an executed counterpart of this Supplement by facsimile or by electronic means shall be equally effective as of the delivery of an originally executed counterpart.
 
Section 703.       Governing Law .  THIS SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW BUT OTHERWISE WITHOUT REFERENCE TO ITS CONFLICTS OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
 
 
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Section 704.       Notices .  All demands, notices and communications hereunder shall be in writing, personally delivered, or by facsimile (with subsequent telephone confirmation of receipt thereof), or sent by internationally recognized overnight courier service, (a) in the case of the Indenture Trustee, at the following address: MAC N9311-161, Sixth Street and Marquette Avenue, Minneapolis, MN 55479; Attention:  Corporate Trust Services - Asset-Backed Administration, Telephone: (612) 667-8058, Facsimile: (612) 667-3467 (b) in the case of the Issuer, at the following address: Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda, Telephone:  (441) 295-5950, Telefax:  (441) 292-4720, Attention:  Secretary, with a copy to each:  (i) CAI at its address at 1 Market Plaza, Suite 900, San Francisco, CA 94105, Telephone:  (415) 788-0100, Telefax:  (415) 788-3430, Attention:  CEO & CFO, (ii) Container Applications Limited at its address at Suite 102, Bush Hill, Bay Street, St. Michael, Barbados, West Indies, Telephone:  (246) 430-5310, Telefax:  (246) 430-5312, Attention:  CEO and CFO, (c) in the case of Standard & Poor’s, at the following address: Standard & Poor’s Ratings Services, 55 Water Street, 41st Floor, New York, New York 10041-0003, Attention: CDO Surveillance Group, or (d) at such other address as shall be designated by such party in a written notice to the other parties.  Any notice required or permitted to be given to a Series 2012-1 Noteholder shall be given by certified first class mail, postage prepaid (return receipt requested), or by courier, or by facsimile, with subsequent telephone confirmation of receipt thereof, in each case at the address of such Series 2012-1 Noteholder as shown in the Note Register or to the telephone and fax number furnished by such Series 2012-1 Noteholder. Notice shall be effective and deemed received (A) upon receipt, if sent by courier or U.S. mail, (B) upon receipt of confirmation of transmission, if sent by facsimile, or (C) when delivered, if delivered by hand. Any rights to notices conveyed to a Rating Agency pursuant to the terms hereof with respect to any Series shall terminate immediately if such Rating Agency no longer has a rating outstanding with respect to such Series.
 
Section 705.   Amendments and Modifications .  The terms of this Supplement may be waived, modified, or amended only in a written instrument signed by each of the Issuer, the Control Party for Series 2012-1 and the Indenture Trustee (except with respect to the matters set forth in Section 1001(a) of the Indenture, in the case of which any such waiver, modification or amendment shall be made subject to the terms of such Section 1001).  Any amendment to or modification or waiver of any of the provisions of this Supplement shall be deemed a supplemental indenture subject to Sections 1001 or 1002 of the Indenture.
 
Section 706.   Consent to Jurisdiction .  ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE ISSUER ARISING OUT OF OR RELATING TO THIS SUPPLEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY, MAY BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, STATE OF NEW YORK AND THE ISSUER HEREBY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND, SOLELY FOR THE PURPOSES OF ENFORCING THIS SUPPLEMENT, THE ISSUER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.
 
 
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Section 707.   Waiver of Jury Trial .  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, AS AGAINST THE OTHER PARTIES HERETO, ANY RIGHTS IT MAY HAVE TO A JURY TRIAL IN RESPECT OF ANY CIVIL ACTION OR PROCEEDING (WHETHER ARISING IN CONTRACT OR TORT OR OTHERWISE), INCLUDING ANY COUNTERCLAIM, ARISING UNDER OR RELATING TO THIS SUPPLEMENT OR ANY OTHER SERIES 2012-1 RELATED DOCUMENT, INCLUDING IN RESPECT OF THE NEGOTIATION, ADMINISTRATION OR ENFORCEMENT HEREOF OR THEREOF.
 
Section 708.   Successors .  This Supplement shall inure to the benefit of and be binding upon the Issuer, the Indenture Trustee and, by its acceptance of any Series 2012-1 Note or any legal or beneficial interest therein, each Series 2012-1 Noteholder and each Note Owner, and each of such Person’s successors and assigns.
 
Section 709.   Nonpetition Covenant .  Each Series 2012-1 Noteholder by its acquisition of a Series 2012-1 Note shall be deemed to covenant and agree, that it will not institute against the Issuer any bankruptcy, reorganization, arrangement insolvency or liquidation Proceedings, or other Proceedings under any federal or state bankruptcy or similar law, at any time other than on a date which is at least one (1) year and one (1) day after the last date on which any Note of any Series was Outstanding.
 
Section 710.   Recourse Against the Issuer .  No recourse under or with respect to any obligation, covenant or agreement (including, without limitation, the payment of any fees or any other obligations) of the Issuer as contained in this Supplement or any other agreement, instrument or document entered into by the Issuer pursuant hereto or in connection herewith shall be had against any administrator of the Issuer or any incorporator, affiliate, shareholder, officer, employee, manager or director of the Issuer or of any such administrator, as such, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any statute or otherwise; it being expressly agreed and understood that the agreements of the Issuer contained in this Supplement and all of the other agreements, instruments and documents entered into by the Issuer pursuant hereto or in connection herewith are, in each case, solely the corporate obligations of the Issuer, and that no personal liability whatsoever shall attach to or be incurred by any administrator of the Issuer or any incorporator, shareholder, affiliate, officer, employee, manager or director of the Issuer or of any such administrator, as such, or any other of them, under or by reason of any of the obligations, covenants or agreements of the Issuer contained in this Supplement or in any other such instruments, documents or agreements, or which are implied therefrom, and that any and all personal liability of every such administrator of the Issuer and each incorporator, shareholder, affiliate, officer, employee, manager or director of the Issuer or of any such administrator, as such, or any of them, for breaches by the Issuer of any such obligations, covenants or agreements, which liability may arise either at common law or at equity, by statute or constitution, or otherwise, is hereby expressly waived as a condition of and in consideration for the execution of this Supplement.  The provisions of this Section 710 shall survive the termination of this Supplement.
 
 
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Section 711.   Reports, Financial Statements and Other Information to Noteholders .  The Indenture Trustee will make available promptly upon receipt thereof to the Series 2012-1 Noteholders via the Indenture Trustee’s internet website at www.CTSLink.com the Equipment and Lease Report, the Manager’s Report, the Asset Base Report, and the annual insurance confirmation; provided , that, as a condition to access to the Indenture Trustee’s website, the Indenture Trustee shall require each such Series 2012-1 Noteholder to execute the Indenture Trustee’s standard form documentation, and upon such execution, each such Series 2012-1 Noteholder shall be deemed to have certified to the Indenture Trustee it (i) is a Series 2012-1 Noteholder, (ii) understands that such items contain material nonpublic information (within the meaning of U.S. Federal Securities laws), (iii) is requesting the information solely for use in evaluating such party’s investment in the Series 2012-1 Notes and will keep such information strictly confidential (with such exceptions and restrictions to distribution of the information as are more fully set forth in the information request certification) and (iv) is not a Competitor. Each time a Series 2012-1 Noteholder accesses the internet website, it will be deemed to have confirmed the representations and warranties made pursuant to the confirmation as of the date of such access. The Indenture Trustee will provide the Issuer with copies of such information request certification. Assistance in using the Indenture Trustee’s website can be obtained by calling the Indenture Trustee’s customer service desk at (866) 846-4526.
 
[Signature pages follow]
 
 
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IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused this Supplement to be duly executed and delivered by their respective officers all as of the day and year first above written.
 
 
CAL FUNDING II LIMITED
 
     
 
By:
/s/ Timothy B. Page
 
       
 
Name:
Timothy B. Page
 
       
 
Title:
Chief Financial Officer
 

 
 
 
 
 
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Indenture Trustee
 
     
 
By:
G. Brad Martin
 
       
 
Name:
G. Brad Martin
 
       
 
Title:
Vice President
 

 
 
 
 
EXHIBIT A-1
 
FORM OF 144A BOOK-ENTRY NOTE

See attached.
 
 
 
 

144A GLOBAL NOTE
 
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE TRANSFEROR OF SUCH NOTE (THE “TRANSFEROR”) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR THE USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
 
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”).  THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT SUCH NOTE MAY BE RESOLD, PLEDGED, OR TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND (1) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON THAT TAKES DELIVERY OF SUCH NOTE IN AN AMOUNT OF AT LEAST $250,000 AND THAT THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT (OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED INSTITUTIONAL BUYER) AND TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT WITH SUCH NOTE IN AN AMOUNT OF AT LEAST $250,000 OR (3) TO A PERSON THAT IS AN INSTITUTIONAL “ACCREDITED INVESTOR,” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT, IS TAKING DELIVERY OF SUCH NOTE IN AN AMOUNT OF AT LEAST $250,000 AND DELIVERS A PURCHASER LETTER TO THE INDENTURE TRUSTEE IN THE FORM ATTACHED TO THE SUPPLEMENT.
 
 
 
 
 
EACH PURCHASER OF A NOTE SHALL BE DEEMED TO REPRESENT AND WARRANT TO THE INITIAL PURCHASERS, THE ISSUER, THE INDENTURE TRUSTEE AND THE MANAGER THAT (I) EITHER (1) IT IS NOT, AND IS NOT ACTING ON BEHALF OF, A PLAN OR A GOVERNMENTAL, CHURCH OR NON-U.S. PLAN WHICH IS SUBJECT TO ANY FEDERAL, STATE, LOCAL, OR NON-U.S. LAW THAT IS SIMILAR TO THE PROHIBITED TRANSACTION PROVISIONS OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE, AND NO PART OF THE ASSETS TO BE USED BY IT TO PURCHASE OR HOLD THE NOTES OR ANY INTEREST THEREIN CONSTITUTES THE ASSETS OF ANY PLAN OR SUCH A GOVERNMENTAL, CHURCH, OR NON-U.S. PLAN; OR (2) (A) THE ACQUISITION, HOLDING, AND DISPOSITION OF THE NOTE WILL NOT GIVE RISE TO A NONEXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE (OR, IN THE CASE OF A GOVERNMENTAL, CHURCH, OR NON-U.S. PLAN, A VIOLATION OF ANY SIMILAR FEDERAL, STATE, LOCAL, OR NON-U.S. LAW) AND (B) THE NOTES ARE RATED INVESTMENT GRADE OR BETTER AND SUCH PERSON BELIEVES THAT THE NOTES ARE PROPERLY TREATED AS INDEBTEDNESS WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE DEPARTMENT OF LABOR REGULATIONS SECTION 2510.101, AND AGREES TO SO TREAT THE NOTES; AND (II) IT WILL NOT SELL OR OTHERWISE TRANSFER THE NOTES OR ANY INTEREST THEREIN OTHERWISE THAN TO A PURCHASER OR TRANSFEREE THAT REPRESENTS AND AGREES WITH RESPECT TO ITS PURCHASE, HOLDING, AND DISPOSITION OF THE NOTES TO THE SAME EFFECT AS THE PURCHASER'S REPRESENTATION AND AGREEMENT SET FORTH IN CLAUSE (I) OF THIS PARAGRAPH.
 
THIS NOTE IS NOT GUARANTEED OR INSURED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
 
 
 
 
 
CAL FUNDING II LIMITED
FIXED RATE ASSET BACKED NOTE, SERIES 2012-1

Up to $171,000,000
CUSIP No.: 12479L AA8
 
No. 1
 
October 18, 2012
 
KNOW ALL PERSONS BY THESE PRESENTS that CAL FUNDING II LIMITED, an exempted company with limited liability organized under the laws of Bermuda (the “Issuer”), for value received, hereby promises to pay to Cede & Co., or registered assigns, at the principal corporate trust office of the Indenture Trustee named below, (i) the principal sum of up to One Hundred Seventy-One Million Dollars ($171,000,000), which sum shall be payable on the dates and in the amounts set forth in the Indenture, dated as of October 18, 2012 (as amended, restated, or otherwise modified from time to time, the “Indenture”) and the Series 2012-1 Supplement, dated as of October 18, 2012 (as amended, restated, or otherwise modified from time to time, the “Series 2012-1 Supplement”), each between the Issuer and Wells Fargo Bank, National Association as indenture trustee (the “Indenture Trustee”), and (ii) interest on the outstanding principal amount of this Note on the dates and in the amounts set forth in the Indenture and the Series 2012-1 Supplement.  Capitalized terms not otherwise defined herein will have the meaning set forth in the Indenture and the Series 2012-1 Supplement.
 
Payment of the principal of and interest on this Note shall be made in lawful money of the United States of America which at the time of payment is legal tender for payment of public and private debts. The principal balance of, and interest on this Note is payable at the times and in the amounts set forth in the Indenture and the Series 2012-1 Supplement by wire transfer of immediately available funds to the account designated by the Holder of record on the immediately preceding Record Date.
 
This Note is one of the authorized notes identified in the title hereto and issued in the aggregate principal amount of up to One Hundred Seventy-One Million Dollars ($171,000,000) pursuant to the Indenture and the Series 2012-1 Supplement.
 
The Notes shall be an obligation of the Issuer and shall be secured by the Collateral, all as defined in, and subject to limitations set forth in, the Indenture and the Series 2012-1 Supplement.
 
This Note is transferable as provided in the Indenture and the Series 2012-1 Supplement, subject to certain limitations therein contained, only upon the books for registration and transfer kept by the Indenture Trustee, and only upon surrender of this Note for transfer to the Indenture Trustee duly endorsed by, or accompanied by a written instrument of transfer in form reasonably satisfactory to the Indenture Trustee duly executed by, the registered Holder hereof or his attorney duly authorized in writing. The Indenture Trustee or the Issuer may require payment by the Holder of a sum sufficient to cover any tax expense or other governmental charge payable in connection with any transfer or exchange of the Notes.
 
 
 
 
 
The Issuer, the Indenture Trustee, and any other agent of the Issuer may treat the person in whose name this Note is registered as the absolute owner hereof for all purposes, and neither the Issuer, the Indenture Trustee, nor any other such agent shall be affected by notice to the contrary.
 
The Notes are subject to Prepayment, at the times and subject to the conditions set forth in the Indenture and the Series 2012-1 Supplement.
 
If an Event of Default shall occur and be continuing, the principal of and accrued interest on this Note may be declared to be due and payable in the manner and with the effect provided in the Indenture and the Series 2012-1 Supplement.
 
The Indenture permits, with certain exceptions as therein provided, the issuance of supplemental indentures with the consent of the Requisite Global Majority, in certain specifically described instances. Any consent given by the Requisite Global Majority shall be conclusive and binding upon the Holder of this Note and on all future holders of this Note and of any Note issued in lieu hereof whether or not notation of such consent is made upon this Note. Supplements and amendments to the Indenture and the Series 2012-1 Supplement may be made only to the extent and in circumstances permitted by the Indenture and the Series 2012-1 Supplement.
 
The Holder of this Note shall have no right to enforce the provisions of the Indenture and the Series 2012-1 Supplement or to institute action to enforce the covenants, or to take any action with respect to a default under the Indenture and the Series 2012-1 Supplement, or to institute, appear in, or defend any suit or other proceedings with respect thereto, except as provided under certain circumstances described in the Indenture and the Series 2012-1 Supplement; provided, however, that nothing contained in the Indenture and the Series 2012-1 Supplement shall affect or impair any right of enforcement conferred on the Holder hereof to enforce any payment of the principal of and interest on this Note on or after the due date thereof; provided further, however, that by acceptance hereof the Holder is deemed to have covenanted and agreed that it will not institute against the Issuer any bankruptcy, reorganization, arrangement, insolvency, or liquidation proceedings, or other proceedings under any applicable bankruptcy or similar law, at any time other than at such time as permitted by Section 1310 of the Indenture and the Series 2012-1 Supplement.
 
Each purchaser of a Note shall be deemed to represent and warrant to the Initial Purchasers, the Issuer, the Indenture Trustee, and the Manager that (a) either (1) it is not, and is not acting on behalf of, a Plan or a governmental, church, or non-U.S. plan which is subject to any federal, state, local, or non-U.S. law that is similar to the prohibited transaction provisions of Section 406 of ERISA or Section 4975 of the Code, and no part of the assets to be used by it to purchase or hold the Series 2012-1 Notes or any interest therein constitutes the assets of any Plan or such a governmental, church, or non-U.S. plan; or (2) (A) the acquisition, holding, and disposition of the Series 2012-1 Note will not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or, in the case of a governmental, church, or non-U.S. plan, a violation of any similar federal, state, local, or non-U.S. law) and (B) the Notes are rated investment grade or better and such person believes that the Series 2012-1 Notes are properly treated as indebtedness without substantial equity features for purposes of Section 2510.3-101 of the regulations issued by the U.S. Department of Labor, and agrees to so treat the Series 2012-1 Notes; and (b) it will not sell or otherwise transfer the Series 2012-1 Notes or any interest therein otherwise than to a purchaser or transferee that represents and agrees with respect to its purchase, holding, and disposition of the Series 2012-1 Notes to the same effect as the purchaser's representation and agreement set forth in this sentence.
 
 
 
 
 
This Note, and the rights and obligations of the parties hereunder, shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York without giving effect to principles of conflict of laws.
 
All terms and provisions of the Indenture and the Series 2012-1 Supplement are herein incorporated by reference as if set forth herein in their entirety.
 
IT IS HEREBY CERTIFIED, RECITED, AND DECLARED, that all acts, conditions, and things required to exist, happen, and be performed precedent to the execution and delivery of the Indenture and the Series 2012-1 Supplement and the issuance of this Note and the issue of which it is a part, do exist, have happened and have been timely performed in regular form and manner as required by law.
 
Unless the certificate of authentication hereon has been executed by the Indenture Trustee by manual signature of one of its authorized officers, this Note shall not be entitled to any benefit under the Indenture and the Series 2012-1 Supplement, or be valid or obligatory for any purpose.
 
 
 
 
 
IN WITNESS WHEREOF, CAL Funding II Limited has caused this Note to be duly executed by its duly authorized representative, on this ___ day of October 2012.
 
 
CAL FUNDING II LIMITED
     
 
By:
 
    Name:
    Title:
 
This Note is one of the Notes described in the within-mentioned Indenture and the Series 2012-1 Supplement.
 
 
WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Indenture Trustee
 
     
 
By:
 
    Name:
    Title:

 
 
 
 
EXHIBIT A-2
 
FORM OF REGULATION S TEMPORARY BOOK-ENTRY NOTE

See attached.
 
 
 
 
 
REGULATION S TEMPORARY GLOBAL NOTE

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE TRANSFEROR OF SUCH NOTE (THE “TRANSFEROR”) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR THE USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
 
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”).  THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT SUCH NOTE MAY BE RESOLD, PLEDGED, OR TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS AND (1) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON THAT TAKES DELIVERY OF SUCH NOTE IN AN AMOUNT OF AT LEAST $250,000 AND THAT THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT (OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED INSTITUTIONAL BUYER) AND TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT WITH SUCH NOTE IN AN AMOUNT OF AT LEAST $250,000 OR (3) TO A PERSON THAT IS AN INSTITUTIONAL “ACCREDITED INVESTOR,” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT, IS TAKING DELIVERY OF SUCH NOTE IN AN AMOUNT OF AT LEAST $250,000 AND DELIVERS A PURCHASER LETTER TO THE INDENTURE TRUSTEE IN THE FORM ATTACHED TO THE SUPPLEMENT.
 
 
 
 
 
EACH PURCHASER OF A NOTE SHALL BE DEEMED TO REPRESENT AND WARRANT TO THE INITIAL PURCHASERS, THE ISSUER, THE INDENTURE TRUSTEE AND THE MANAGER THAT (I) EITHER (1) IT IS NOT, AND IS NOT ACTING ON BEHALF OF, A PLAN OR A GOVERNMENTAL, CHURCH OR NON-U.S. PLAN WHICH IS SUBJECT TO ANY FEDERAL, STATE, LOCAL, OR NON-U.S. LAW THAT IS SIMILAR TO THE PROHIBITED TRANSACTION PROVISIONS OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE, AND NO PART OF THE ASSETS TO BE USED BY IT TO PURCHASE OR HOLD THE NOTES OR ANY INTEREST THEREIN CONSTITUTES THE ASSETS OF ANY PLAN OR SUCH A GOVERNMENTAL, CHURCH, OR NON-U.S. PLAN; OR (2) (A) THE ACQUISITION, HOLDING, AND DISPOSITION OF THE NOTE WILL NOT GIVE RISE TO A NONEXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE (OR, IN THE CASE OF A GOVERNMENTAL, CHURCH, OR NON-U.S. PLAN, A VIOLATION OF ANY SIMILAR FEDERAL, STATE, LOCAL, OR NON-U.S. LAW) AND (B) THE NOTES ARE RATED INVESTMENT GRADE OR BETTER AND SUCH PERSON BELIEVES THAT THE NOTES ARE PROPERLY TREATED AS INDEBTEDNESS WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE DEPARTMENT OF LABOR REGULATIONS SECTION 2510.101, AND AGREES TO SO TREAT THE NOTES; AND (II) IT WILL NOT SELL OR OTHERWISE TRANSFER THE NOTES OR ANY INTEREST THEREIN OTHERWISE THAN TO A PURCHASER OR TRANSFEREE THAT REPRESENTS AND AGREES WITH RESPECT TO ITS PURCHASE, HOLDING, AND DISPOSITION OF THE NOTES TO THE SAME EFFECT AS THE PURCHASER'S REPRESENTATION AND AGREEMENT SET FORTH IN CLAUSE (I) OF THIS PARAGRAPH.
 
THIS NOTE IS NOT GUARANTEED OR INSURED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
 
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND, PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE LATER OF (I) THE COMPLETION OF THE DISTRIBUTION OF THE NOTES AND (II) THE CLOSING DATE, MAY NOT BE OFFERED, SOLD, PLEDGED, OR OTHERWISE TRANSFERRED IN THE UNITED STATES OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE PROCEDURES SPECIFIED IN THE INDENTURE.
 
 
 
 
 
CAL FUNDING II LIMITED FIXED RATE ASSET BACKED NOTE, SERIES 2012-1

Up to $171,000,000
CUSIP No.: G17686 AA7
 
No. 1
 
October 18, 2012
 
KNOW ALL PERSONS BY THESE PRESENTS that CAL FUNDING II LIMITED, an exempted company with limited liability organized under the laws of Bermuda (the “Issuer”), for value received, hereby promises to pay to Cede & Co., or registered assigns, at the principal corporate trust office of the Indenture Trustee named below, (i) the principal sum of up to One Hundred Seventy-One Million Dollars ($171,000,000), which sum shall be payable on the dates and in the amounts set forth in the Indenture, dated as of October 18, 2012 (as amended, restated, or otherwise modified from time to time, the “Indenture”) and the Series 2012-1 Supplement, dated as of October 18, 2012 (as amended, restated, or otherwise modified from time to time, the “Series 2012-1 Supplement”), each between the Issuer and Wells Fargo Bank, National Association as indenture trustee (the “Indenture Trustee”), and (ii) interest on the outstanding principal amount of this Note on the dates and in the amounts set forth in the Indenture and the Series 2012-1 Supplement.  Capitalized terms not otherwise defined herein will have the meaning set forth in the Indenture and the Series 2012-1 Supplement.
 
Payment of the principal of and interest on this Note shall be made in lawful money of the United States of America which at the time of payment is legal tender for payment of public and private debts. The principal balance of, and interest on this Note is payable at the times and in the amounts set forth in the Indenture and the Series 2012-1 Supplement by wire transfer of immediately available funds to the account designated by the Holder of record on the immediately preceding Record Date.
 
This Note is one of the authorized notes identified in the title hereto and issued in the aggregate principal amount of up to One Hundred Seventy-One Million Dollars ($171,000,000) pursuant to the Indenture and the Series 2012-1 Supplement.
 
The Notes shall be an obligation of the Issuer and shall be secured by the Collateral, all as defined in, and subject to limitations set forth in, the Indenture and the Series 2012-1 Supplement.
 
This Note is transferable as provided in the Indenture and the Series 2012-1 Supplement, subject to certain limitations therein contained, only upon the books for registration and transfer kept by the Indenture Trustee, and only upon surrender of this Note for transfer to the Indenture Trustee duly endorsed by, or accompanied by a written instrument of transfer in form reasonably satisfactory to the Indenture Trustee duly executed by, the registered Holder hereof or his attorney duly authorized in writing. The Indenture Trustee or the Issuer may require payment by the Holder of a sum sufficient to cover any tax expense or other governmental charge payable in connection with any transfer or exchange of the Notes.
 
 
 
 
 
The Issuer, the Indenture Trustee, and any other agent of the Issuer may treat the person in whose name this Note is registered as the absolute owner hereof for all purposes, and neither the Issuer, the Indenture Trustee, nor any other such agent shall be affected by notice to the contrary.
 
The Notes are subject to Prepayment, at the times and subject to the conditions set forth in the Indenture and the Series 2012-1 Supplement.
 
If an Event of Default shall occur and be continuing, the principal of and accrued interest on this Note may be declared to be due and payable in the manner and with the effect provided in the Indenture and the Series 2012-1 Supplement.
 
The Indenture permits, with certain exceptions as therein provided, the issuance of supplemental indentures with the consent of the Requisite Global Majority, in certain specifically described instances. Any consent given by the Requisite Global Majority shall be conclusive and binding upon the Holder of this Note and on all future holders of this Note and of any Note issued in lieu hereof whether or not notation of such consent is made upon this Note. Supplements and amendments to the Indenture and the Series 2012-1 Supplement may be made only to the extent and in circumstances permitted by the Indenture and the Series 2012-1 Supplement.
 
The Holder of this Note shall have no right to enforce the provisions of the Indenture and the Series 2012-1 Supplement or to institute action to enforce the covenants, or to take any action with respect to a default under the Indenture and the Series 2012-1 Supplement, or to institute, appear in, or defend any suit or other proceedings with respect thereto, except as provided under certain circumstances described in the Indenture and the Series 2012-1 Supplement; provided, however, that nothing contained in the Indenture and the Series 2012-1 Supplement shall affect or impair any right of enforcement conferred on the Holder hereof to enforce any payment of the principal of and interest on this Note on or after the due date thereof; provided further, however, that by acceptance hereof the Holder is deemed to have covenanted and agreed that it will not institute against the Issuer any bankruptcy, reorganization, arrangement, insolvency, or liquidation proceedings, or other proceedings under any applicable bankruptcy or similar law, at any time other than at such time as permitted by Section 1310 of the Indenture and the Series 2012-1 Supplement.
 
Each purchaser of a Note shall be deemed to represent and warrant to the Initial Purchasers, the Issuer, the Indenture Trustee, and the Manager that (a) either (1) it is not, and is not acting on behalf of, a Plan or a governmental, church, or non-U.S. plan which is subject to any federal, state, local, or non-U.S. law that is similar to the prohibited transaction provisions of Section 406 of ERISA or Section 4975 of the Code, and no part of the assets to be used by it to purchase or hold the Series 2012-1 Notes or any interest therein constitutes the assets of any Plan or such a governmental, church, or non-U.S. plan; or (2) (A) the acquisition, holding, and disposition of the Series 2012-1 Note will not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or, in the case of a governmental, church, or non-U.S. plan, a violation of any similar federal, state, local, or non-U.S. law) and (B) the Notes are rated investment grade or better and such person believes that the Series 2012-1 Notes are properly treated as indebtedness without substantial equity features for purposes of Section 2510.3-101 of the regulations issued by the U.S. Department of Labor, and agrees to so treat the Series 2012-1 Notes; and (b) it will not sell or otherwise transfer the Series 2012-1 Notes or any interest therein otherwise than to a purchaser or transferee that represents and agrees with respect to its purchase, holding, and disposition of the Series 2012-1 Notes to the same effect as the purchaser's representation and agreement set forth in this sentence.
 
 
 
 
 
This Note, and the rights and obligations of the parties hereunder, shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York without giving effect to principles of conflict of laws.
 
All terms and provisions of the Indenture and the Series 2012-1 Supplement are herein incorporated by reference as if set forth herein in their entirety.
 
IT IS HEREBY CERTIFIED, RECITED, AND DECLARED, that all acts, conditions, and things required to exist, happen, and be performed precedent to the execution and delivery of the Indenture and the Series 2012-1 Supplement and the issuance of this Note and the issue of which it is a part, do exist, have happened and have been timely performed in regular form and manner as required by law.
 
Unless the certificate of authentication hereon has been executed by the Indenture Trustee by manual signature of one of its authorized officers, this Note shall not be entitled to any benefit under the Indenture and the Series 2012-1 Supplement, or be valid or obligatory for any purpose.
 
 
 
 
 
IN WITNESS WHEREOF, CAL Funding II Limited has caused this Note to be duly executed by its duly authorized representative, on this ___ day of October 2012.
 
 
CAL FUNDING II LIMITED
     
 
By:
 
    Name:
    Title:
 
This Note is one of the Notes described in the within-mentioned Indenture and the Series 2012-1 Supplement.
 
 
WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Indenture Trustee
 
     
 
By:
 
    Name:
    Title:

 
 
 
 
EXHIBIT A-3
 
FORM OF UNRESTRICTED BOOK-ENTRY NOTE

See attached.
 
 
 
 
 
EXHIBIT A-4
 
FORM OF NOTE ISSUED TO INSTITUTIONAL ACCREDITED INVESTORS

See attached.
 
 
 
 

EXHIBIT B
 
FORM OF
CERTIFICATE TO BE GIVEN BY NOTEHOLDER
 
[Euroclear Bank S.A./N.V., as operator
of the Euroclear Clearance System
1 Boulevard du Roi Albert II
B-1210 Brussels, Belgium]
 
[Clearstream Banking, société anonyme
67 Boulevard Grand-Duchesse Charlotte
L-1331 Luxembourg]
 
 
Re:
Fixed Rate Asset Backed Notes (the “ Offered Notes ”) issued pursuant to the Series 2012-1 Supplement, dated as of October 18, 2012, between CAL Funding II Limited (the “ Issuer ”) and Wells Fargo Bank, National Association (the “ Indenture Trustee ”) to the Indenture, dated as of October 18, 2012, between the Issuer and the Indenture Trustee.
 
This is to certify that as of the date hereof, and except as set forth below, the beneficial interest in the Offered Notes held by you for our account is owned by Persons that are not U.S. Persons (as defined in Rule 902 under the Securities Act of 1933, as amended).
 
The undersigned undertakes to advise you promptly by tested telex on or prior to the date on which you intend to submit your certification relating to the Offered Notes held by you in which the undersigned has acquired, or intends to acquire, a beneficial interest in accordance with your operating procedures if any applicable statement herein is not correct on such date. In the absence of any such notification, it may be assumed that this certification applies as of such date.
 
[This certification excepts beneficial interests in and does not relate to U.S. $_________ principal amount of the Offered Notes appearing in your books as being held for our account but that we have sold or as to which we are not yet able to certify.]
 
We understand that this certification is required in connection with certain securities laws in the United States of America. If administrative or legal Proceedings are commenced or threatened in connection with which this certification is or would be relevant, we irrevocably authorize you to produce this certification or a copy thereof to any interested party in such Proceedings.
 
Dated:*
 
 
By:
   
       
Account Holder
 

*Certification must be dated on or after the 15th day before the date of the Euroclear or Clearstream certificate to which this certification relates.
 
 
 
 

EXHIBIT C
 
FORM OF
CERTIFICATE TO BE GIVEN BY EUROCLEAR OR CLEARSTREAM
 
Wells Fargo Bank, National Association,
  as Indenture Trustee and Note Registrar
Sixth Street and Marquette Avenue
Minneapolis, Minnesota  55479
Attention: Corporate Trust Services/Asset-Backed Administrator

 
Re:
Fixed Rate Asset Backed Notes (the “ Offered Notes ”) issued pursuant to the Series 2012-1 Supplement, dated as of October 18, 2012, between CAL Funding II Limited (the “ Issuer ”) and Wells Fargo Bank, National Association (the “ Indenture Trustee ”) to the Indenture, dated as of October 18, 2012, between the Issuer and the Indenture Trustee.
 
This is to certify that, based solely on certifications we have received in writing, by tested telex or by electronic transmission from member organizations appearing in our records as Persons being entitled to a portion of the principal amount set forth below (our “ Member Organizations ”) as of the date hereof, $__________ principal amount of the Offered Notes is owned by Persons (a) that are not U.S. Persons (as defined in Rule 902 under the Securities Act of 1933, as amended (the “ Securities Act ”), and used in Regulation S) or (b) who purchased their Offered Notes (or interests therein) in a transaction or transactions that did not require registration under the Securities Act.
 
We further certify (a) that we are not making available herewith for exchange any portion of the related Regulation S Temporary Book-Entry Note excepted in such certifications and (b) that as of the date hereof we have not received any notification from any of our Member Organizations to the effect that the statements made by them with respect to any portion of the part submitted herewith for exchange are no longer true and cannot be relied upon as of the date hereof.
 
We understand that this certification is required in connection with certain securities laws of the United States of America. If administrative or legal Proceedings are commenced or threatened in connection with which this certification is or would be relevant, we irrevocably authorize you to produce this certification or a copy hereof to any interested party in such Proceedings.
 
Date:
 
 
Yours faithfully,
       
     
By:
     
[Morgan Guaranty Trust Company of New York, Brussels Office, as Operator of the Euroclear Clearance System] [Clearstream Banking, société anonyme]

 
 
 

EXHIBIT D
 
FORM OF
CERTIFICATE TO BE GIVEN BY TRANSFEREE OF BENEFICIAL INTEREST IN A
REGULATION S TEMPORARY BOOK-ENTRY NOTE
 
[Euroclear Bank S.A./N.V., as operator
of the Euroclear Clearance System
1 Boulevard du Roi Albert II
B-1210 Brussels, Belgium]
 
[Clearstream Banking, société anonyme
67 Boulevard Grand-Duchesse Charlotte
L-1331 Luxembourg]
 
 
Re:
Fixed Rate Asset Backed Notes (the “ Offered Notes ”) issued pursuant to the Series 2012-1 Supplement, dated as of October 18, 2012, between CAL Funding II Limited (the “ Issuer ”) and Wells Fargo Bank, National Association (the “ Indenture Trustee ”) to the Indenture, dated as of October 18, 2012, between the Issuer and the Indenture Trustee.
 
This is to certify that as of the date hereof, and except as set forth below, for purposes of acquiring a beneficial interest in the Offered Notes, the undersigned certifies that it is not a U.S. Person (as defined in Rule 902 under the Securities Act of 1933, as amended,  and used in Regulation S).
 
The undersigned undertakes to advise you promptly by tested telex on or prior to the date on which you intend to submit your certification relating to the Offered Notes held by you in which the undersigned intends to acquire a beneficial interest in accordance with your operating procedures if any applicable statement herein is not correct on such date. In the absence of any such notification, it may be assumed that this certification applies as of such date.
 
We understand that this certification is required in connection with certain securities laws in the United States of America. If administrative or legal Proceedings are commenced or threatened in connection with which this certification is or would be relevant, we irrevocably authorize you to produce this certification or a copy thereof to any interested party in such Proceedings.
 
Dated:
 
By:
     

 
 
 
 
EXHIBIT E
 
FORM OF
TRANSFER CERTIFICATE FOR EXCHANGE OR
TRANSFER FROM 144A BOOK-ENTRY NOTE
TO REGULATION S BOOK-ENTRY NOTE
 
Wells Fargo Bank, National Association,
as Indenture Trustee and Note Registrar
Sixth Street and Marquette Avenue
Minneapolis, Minnesota  55479
Attention:  Corporate Trust Services/Asset-Backed Administrator
 
 
Re:
Fixed Rate Asset Backed Notes (the “ Offered Notes ”) issued pursuant to the Series 2012-1 Supplement, dated as of October 18, 2012, between CAL Funding II Limited (the “ Issuer ”) and Wells Fargo Bank, National Association (the “ Indenture Trustee ”) to the Indenture, dated as of October 18, 2012, between the Issuer and the Indenture Trustee.
 
Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.
 
This letter relates to U.S. $___________ principal amount of Offered Notes that are held as a beneficial interest in the 144A Book-Entry Note (CUSIP No. 12479L AA8) with DTC in the name of [insert name of transferor] (the “ Transferor ”). The Transferor has requested an exchange or transfer of the beneficial interest for an interest in the Regulation S Book-Entry Note (CUSIP No. G17686 AA7) to be held with [Euroclear] [Clearstream] through DTC.
 
In connection with the request and in receipt of the Offered Notes, the Transferor does hereby certify that the exchange or transfer has been effected in accordance with the transfer restrictions set forth in the Indenture and the Offered Notes and:
 
(a)  pursuant to and in accordance with Regulation S under the Securities Act of 1933, as amended (the “ Securities Act ”), and accordingly the Transferor does hereby certify that:
 
(i)  the offer of the Offered Notes was not made to a Person in the United States of America,
 
(ii)  either (A) at the time the buy order was originated, the transferee was outside the United States of America or the Transferor and any Person acting on its behalf reasonably believed that the transferee was outside the United States of America, or (B) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither the Transferor nor any Person acting on its behalf knows that the transaction was pre-arranged with a buyer in the United States of America,
 
(iii)  no directed selling efforts have been made in contravention of the requirements of Rule 903 or 904 of Regulation S, as applicable, and the other conditions of Rule 903 or Rule 904 of Regulation S, as applicable, have been satisfied and
 
(iv)  the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act, and
 
 
E-1
 
 
(b) with respect to transfers made in reliance on Rule 144A under the Securities Act, the Transferor does hereby certify that the Notes are being transferred in a transaction permitted by Rule 144A under the Securities Act.
 
This certification and the statements contained herein are made for your benefit and the benefit of the Issuer and Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as the Initial Purchasers.
 
   
[Insert name of Transferor]
     
Dated:
 
By:
   
Title:

 
E-2
 
 
EXHIBIT F
 
FORM OF
INITIAL PURCHASERS EXCHANGE INSTRUCTIONS
 
Depository Trust Company
55 Water Street
50th Floor
New York, New York 10041
 
 
Re:
$__________ of the Fixed Rate Asset Backed Notes, Series 2012-1 (the “ Notes ”) issued pursuant to the Series 2012-1 Supplement, dated as of  October 18, 2012, between CAL Funding II Limited (the “ Issuer ”) and Wells Fargo Bank, National Association (the “ Indenture Trustee ”) to the Indenture, dated as of October 18, 2012, between the Issuer and the Indenture Trustee.
 
Pursuant to Section 207 of the Series 2012-1 Supplement, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC (collectively, the “ Initial Purchasers ”), hereby requests that $____________ aggregate principal amount of the Notes held by you for our account and represented by the Regulation S Temporary Book-Entry Note (CUSIP No. G17686 AA7) (as defined in the Series 2012-1 Supplement) be exchanged for an equal principal amount represented by the 144A Book-Entry Note (CUSIP No. 12479L AA8) to be held by you for our account.
 
Dated:
 
Merrill Lynch, Pierce, Fenner & Smith Incorporated,
as an Initial Purchaser
     
   
By:
   
Title:
     
   
Wells Fargo Securities, LLC
as an Initial Purchaser
     
   
By:
   
Title:

 
 
 

SCHEDULE I
Minimum Targeted Principal Balance by Period
 
Period Date   Principal Balance   Period Date Principal Balance   Period   Date   Principal Balance
                     
0
Oct-12
$171,000,000
 
61
Nov-17
$113,050,000
 
121
Nov-22
$56,050,000
1
Nov-12
170,050,000
 
62
Dec-17
112,100,000
 
122
Dec-22
55,100,000
2
Dec-12
169,100,000
 
63
Jan-18
111,150,000
 
123
Jan-23
54,150,000
3
Jan-13
168,150,000
 
64
Feb-18
110,200,000
 
124
Feb-23
53,200,000
4
Feb-13
167,200,000
 
65
Mar-18
109,250,000
 
125
Mar-23
52,250,000
5
Mar-13
166,250,000
 
66
Apr-18
108,300,000
 
126
Apr-23
51,300,000
6
Apr-13
165,300,000
 
67
May-18
107,350,000
 
127
May-23
50,350,000
7
May-13
164,350,000
 
68
Jun-18
106,400,000
 
128
Jun-23
49,400,000
8
Jun-13
163,400,000
 
69
Jul-18
105,450,000
 
129
Jul-23
48,450,000
9
Jul-13
162,450,000
 
70
Aug-18
104,500,000
 
130
Aug-23
47,500,000
10
Aug-13
161,500,000
 
71
Sep-18
103,550,000
 
131
Sep-23
46,550,000
11
Sep-13
160,550,000
 
72
Oct-18
102,600,000
 
132
Oct-23
45,600,000
12
Oct-13
159,600,000
 
73
Nov-18
101,650,000
 
133
Nov-23
44,650,000
13
Nov-13
158,650,000
 
74
Dec-18
100,700,000
 
134
Dec-23
43,700,000
14
Dec-13
157,700,000
 
75
Jan-19
99,750,000
 
135
Jan-24
42,750,000
15
Jan-14
156,750,000
 
76
Feb-19
98,800,000
 
136
Feb-24
41,800,000
16
Feb-14
155,800,000
 
77
Mar-19
97,850,000
 
137
Mar-24
40,850,000
17
Mar-14
154,850,000
 
78
Apr-19
96,900,000
 
138
Apr-24
39,900,000
18
Apr-14
153,900,000
 
79
May-19
95,950,000
 
139
May-24
38,950,000
19
May-14
152,950,000
 
80
Jun-19
95,000,000
 
140
Jun-24
38,000,000
20
Jun-14
152,000,000
 
81
Jul-19
94,050,000
 
141
Jul-24
37,050,000
21
Jul-14
151,050,000
 
82
Aug-19
93,100,000
 
142
Aug-24
36,100,000
22
Aug-14
150,100,000
 
83
Sep-19
92,150,000
 
143
Sep-24
35,150,000
23
Sep-14
149,150,000
 
84
Oct-19
91,200,000
 
144
Oct-24
34,200,000
24
Oct-14
148,200,000
 
85
Nov-19
90,250,000
 
145
Nov-24
33,250,000
25
Nov-14
147,250,000
 
86
Dec-19
89,300,000
 
146
Dec-24
32,300,000
26
Dec-14
146,300,000
 
87
Jan-20
88,350,000
 
147
Jan-25
31,350,000
27
Jan-15
145,350,000
 
88
Feb-20
87,400,000
 
148
Feb-25
30,400,000
28
Feb-15
144,400,000
 
89
Mar-20
86,450,000
 
149
Mar-25
29,450,000
29
Mar-15
143,450,000
 
90
Apr-20
85,500,000
 
150
Apr-25
28,500,000
30
Apr-15
142,500,000
 
91
May-20
84,550,000
 
151
May-25
27,550,000
31
May-15
141,550,000
 
92
Jun-20
83,600,000
 
152
Jun-25
26,600,000
32
Jun-15
140,600,000
 
93
Jul-20
82,650,000
 
153
Jul-25
25,650,000
33
Jul-15
139,650,000
 
94
Aug-20
81,700,000
 
154
Aug-25
24,700,000
34
Aug-15
138,700,000
 
95
Sep-20
80,750,000
 
155
Sep-25
23,750,000
35
Sep-15
137,750,000
 
96
Oct-20
79,800,000
 
156
Oct-25
22,800,000
36
Oct-15
136,800,000
 
97
Nov-20
78,850,000
 
157
Nov-25
21,850,000
37
Nov-15
135,850,000
 
98
Dec-20
77,900,000
 
158
Dec-25
20,900,000
38
Dec-15
134,900,000
 
99
Jan-21
76,950,000
 
159
Jan-26
19,950,000
39
Jan-16
133,950,000
 
100
Feb-21
76,000,000
 
160
Feb-26
19,000,000
40
Feb-16
133,000,000
 
101
Mar-21
75,050,000
 
161
Mar-26
18,050,000
41
Mar-16
132,050,000
 
102
Apr-21
74,100,000
 
162
Apr-26
17,100,000
42
Apr-16
131,100,000
 
103
May-21
73,150,000
 
163
May-26
16,150,000
43
May-16
130,150,000
 
104
Jun-21
72,200,000
 
164
Jun-26
15,200,000
44
Jun-16
129,200,000
 
105
Jul-21
71,250,000
 
165
Jul-26
14,250,000
45
Jul-16
128,250,000
 
106
Aug-21
70,300,000
 
166
Aug-26
13,300,000
46
Aug-16
127,300,000
 
107
Sep-21
69,350,000
 
167
Sep-26
12,350,000
47
Sep-16
126,350,000
 
108
Oct-21
68,400,000
 
168
Oct-26
11,400,000
48
Oct-16
125,400,000
 
109
Nov-21
67,450,000
 
169
Nov-26
10,450,000
49
Nov-16
124,450,000
 
110
Dec-21
66,500,000
 
170
Dec-26
9,500,000
50
Dec-16
123,500,000
 
111
Jan-22
65,550,000
 
171
Jan-27
8,550,000
51
Jan-17
122,550,000
 
112
Feb-22
64,600,000
 
172
Feb-27
7,600,000
52
Feb-17
121,600,000
 
113
Mar-22
63,650,000
 
173
Mar-27
6,650,000
53
Mar-17
120,650,000
 
114
Apr-22
62,700,000
 
174
Apr-27
5,700,000
54
Apr-17
119,700,000
 
115
May-22
61,750,000
 
175
May-27
4,750,000
55
May-17
118,750,000
 
116
Jun-22
60,800,000
 
176
Jun-27
3,800,000
56
Jun-17
117,800,000
 
117
Jul-22
59,850,000
 
177
Jul-27
2,850,000
57
Jul-17
116,850,000
 
118
Aug-22
58,900,000
 
178
Aug-27
1,900,000
58
Aug-17
115,900,000
 
119
Sep-22
57,950,000
 
179
Sep-27
950,000
59
Sep-17
114,950,000
 
120
Oct-22
57,000,000
 
180
Oct-27
0
60
Oct-17
114,000,000
               
 
 
 
 
 
Scheduled Targeted Principal Balance by Period
 
Period Date Principal Balance   Period Date Principal Balance   Period Date Principal Balance
                     
0
Oct-12
$171,000,000
 
41
Mar-16
$112,575,000
 
81
Jul-19
$55,575,000
1
Nov-12
169,575,000
 
42
Apr-16
111,150,000
 
82
Aug-19
54,150,000
2
Dec-12
168,150,000
 
43
May-16
109,725,000
 
83
Sep-19
52,725,000
3
Jan-13
166,725,000
 
44
Jun-16
108,300,000
 
84
Oct-19
51,300,000
4
Feb-13
165,300,000
 
45
Jul-16
106,875,000
 
85
Nov-19
49,875,000
5
Mar-13
163,875,000
 
46
Aug-16
105,450,000
 
86
Dec-19
48,450,000
6
Apr-13
162,450,000
 
47
Sep-16
104,025,000
 
87
Jan-20
47,025,000
7
May-13
161,025,000
 
48
Oct-16
102,600,000
 
88
Feb-20
45,600,000
8
Jun-13
159,600,000
 
49
Nov-16
101,175,000
 
89
Mar-20
44,175,000
9
Jul-13
158,175,000
 
50
Dec-16
99,750,000
 
90
Apr-20
42,750,000
10
Aug-13
156,750,000
 
51
Jan-17
98,325,000
 
91
May-20
41,325,000
11
Sep-13
155,325,000
 
52
Feb-17
96,900,000
 
92
Jun-20
39,900,000
12
Oct-13
153,900,000
 
53
Mar-17
95,475,000
 
93
Jul-20
38,475,000
13
Nov-13
152,475,000
 
54
Apr-17
94,050,000
 
94
Aug-20
37,050,000
14
Dec-13
151,050,000
 
55
May-17
92,625,000
 
95
Sep-20
35,625,000
15
Jan-14
149,625,000
 
56
Jun-17
91,200,000
 
96
Oct-20
34,200,000
16
Feb-14
148,200,000
 
57
Jul-17
89,775,000
 
97
Nov-20
32,775,000
17
Mar-14
146,775,000
 
58
Aug-17
88,350,000
 
98
Dec-20
31,350,000
18
Apr-14
145,350,000
 
59
Sep-17
86,925,000
 
99
Jan-21
29,925,000
19
May-14
143,925,000
 
60
Oct-17
85,500,000
 
100
Feb-21
28,500,000
20
Jun-14
142,500,000
 
61
Nov-17
84,075,000
 
101
Mar-21
27,075,000
21
Jul-14
141,075,000
 
62
Dec-17
82,650,000
 
102
Apr-21
25,650,000
22
Aug-14
139,650,000
 
63
Jan-18
81,225,000
 
103
May-21
24,225,000
23
Sep-14
138,225,000
 
64
Feb-18
79,800,000
 
104
Jun-21
22,800,000
24
Oct-14
136,800,000
 
65
Mar-18
78,375,000
 
105
Jul-21
21,375,000
25
Nov-14
135,375,000
 
66
Apr-18
76,950,000
 
106
Aug-21
19,950,000
26
Dec-14
133,950,000
 
67
May-18
75,525,000
 
107
Sep-21
18,525,000
27
Jan-15
132,525,000
 
68
Jun-18
74,100,000
 
108
Oct-21
17,100,000
28
Feb-15
131,100,000
 
69
Jul-18
72,675,000
 
109
Nov-21
15,675,000
29
Mar-15
129,675,000
 
70
Aug-18
71,250,000
 
110
Dec-21
14,250,000
30
Apr-15
128,250,000
 
71
Sep-18
69,825,000
 
111
Jan-22
12,825,000
31
May-15
126,825,000
 
72
Oct-18
68,400,000
 
112
Feb-22
11,400,000
32
Jun-15
125,400,000
 
73
Nov-18
66,975,000
 
113
Mar-22
9,975,000
33
Jul-15
123,975,000
 
74
Dec-18
65,550,000
 
114
Apr-22
8,550,000
34
Aug-15
122,550,000
 
75
Jan-19
64,125,000
 
115
May-22
7,125,000
35
Sep-15
121,125,000
 
76
Feb-19
62,700,000
 
116
Jun-22
5,700,000
36
Oct-15
119,700,000
 
77
Mar-19
61,275,000
 
117
Jul-22
4,275,000
37
Nov-15
118,275,000
 
78
Apr-19
59,850,000
 
118
Aug-22
2,850,000
38
Dec-15
116,850,000
 
79
May-19
58,425,000
 
119
Sep-22
1,425,000
39
Jan-16
115,425,000
 
80
Jun-19
57,000,000
 
120
Oct-22
0
40
Feb-16
114,000,000
               
 
 
EXHIBIT 99.1
 
 
NOTE PURCHASE AGREEMENT
 
Dated as of October 11, 2012
 
Among
 
CAL FUNDING II LIMITED
 
as Issuer
 
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
 
and
 
WELLS FARGO SECURITIES, LLC
 
as the Initial Purchasers
 
and
 
CONTAINER APPLICATIONS LIMITED
 
(CAL FUNDING II LIMITED -
FIXED RATE ASSET BACKED NOTES, SERIES 2012-1)
 
 
 
 
 
TABLE OF CONTENTS
 
   
Page
     
Section 1.
Definitions
1
Section 2.
The Notes
3
Section 3.
Information
4
Section 4.
Representations and Warranties of the Issuer and CAL
5
Section 5.
Offering by the Initial Purchasers
9
Section 6.
Covenants of the Issuer and CAL
10
Section 7.
Expenses; Fees
13
Section 8.
Conditions of the Initial Purchasers’ Obligations
14
Section 9.
Representations, Warranties and Covenants of the Initial Purchasers
18
Section 10.
Indemnification and Contribution
19
Section 11.
Survival of Representations and Warranties
21
Section 12.
Termination
21
Section 13.
Initial Purchaser Information
21
Section 14.
Notices
21
Section 15.
Successors
22
Section 16.
Counterparts
23
Section 17.
Governing Law
23
Section 18.
Submission to Jurisdiction
23
Section 19.
Waiver of Jury Trial
24
Section 20.
Negotiations
24
Section 21.
Amendments, etc
24
Section 22.
Severability of Provisions
24
Section 23.
No Waiver; Cumulative Remedies
24
Section 24.
Integration
24
Section 25.
Nonpetition Covenant
24
Section 26.
Recourse Against Certain Parties
25
Section 27.
USA Patriot Act
25
Section 28.
Confidentiality
25

Exhibit A
-           Cash Flow Information
Schedule I
-           Initial Purchaser and Note Amounts
Schedule II
-           Initial Purchaser Information
 
 
 
 
 
NOTE PURCHASE AGREEMENT (as amended, modified and supplemented from time to time in accordance with its terms, the “ Agreement ”), dated as of October 11, 2012, by and among:
 
(1)           CAL FUNDING II LIMITED, an exempted company with limited liability incorporated and existing under the laws of Bermuda, as issuer under the Indenture (defined below) and the Series 2012-1 Supplement (defined below) (the “ Issuer ”);
 
(2)           MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, a Delaware corporation (“ MLPFS ” and an “ Initial Purchaser ”);
 
(3)           WELLS FARGO SECURITIES, LLC, a Delaware corporation (“ WFS ” and an “ Initial Purchaser ”); and
 
(4)           solely with respect to Sections 4, 6, 8, 10 and 18 hereof, CONTAINER APPLICATIONS LIMITED, an international business company incorporated and licensed under the laws of Barbados (“ CAL ”).
 
NOW THEREFORE, in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:
 
Section 1.             Definitions.
 
(a)           Certain capitalized terms used throughout this Agreement are defined above or in Section 1(b) hereof.  In addition, capitalized terms used but not defined herein have the meanings given to such terms in the Indenture, dated as of October 18, 2012 (as amended, restated, supplemented or otherwise modified from time to time in accordance with its terms, the “ Indenture ”), by and between the Issuer and Wells Fargo Bank, National Association, as indenture trustee (the “ Indenture Trustee ”), or, if not defined therein, as defined in the Series 2012-1 Supplement, dated as of October 18, 2012 (as amended, restated, supplemented or otherwise modified from time to time in accordance with its terms, the “ Series 2012-1 Supplement ”), by and between the Issuer and the Indenture Trustee, issued pursuant to the terms of the Indenture.
 
(b)           As used in this Agreement and its exhibits, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined).
 
“ Act ”:  The Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
 
“ Additional Disclosure Document ”:  Any information prepared by, or on behalf of, the Issuer for delivery to prospective Series 2012-1 Noteholders, other than the Preliminary Offering Memorandum and the Offering Memorandum. For the avoidance of doubt the Investor Cash Flow Information, shall constitute an Additional Disclosure Document. None of the Related Documents or Series 2012-1 Related Documents shall be deemed to constitute an Additional Disclosure Document.
 
“ BofAML ”:  This term has the meaning set forth in preamble hereto.
 
 
 
 
 
“ Closing Date ”:  This term has the meaning set forth in Section 2(a) hereof.
 
“ Code ”:  Internal Revenue Code of 1986, as amended.
 
“ Commission ”:  The United States Securities and Exchange Commission.
 
“ Indenture ”:  This term shall have the meaning set forth in Section 1(a) hereof.
 
“ Independent Accountants ”:  This term shall have the meaning set forth in Section 7.11 of the Management Agreement.
 
“ Institutional Accredited Investors ”:  This term has the meaning set forth in Section 3(b) hereof.
 
“ Initial Purchasers ”:  This term has the meaning set forth in the preamble hereto.
 
“ Initial Purchaser Information ”:  With respect to the Initial Purchasers, the information described in Schedule II hereto, but only to the extent that such information relates to the Initial Purchasers.
 
“ Investment Company Act ”:  The Investment Company Act of 1940, as amended.
 
“ Investor Cash Flow Information ”. Each of the cash flow reports listed on Exhibit A hereto provided to prospective purchasers of the Notes of at the request of such investor.
 
“ Issuer ”:  This term has the meaning set forth in the preamble hereto.
 
“ Issuer Indemnified Party ”:  This term shall have the meaning set forth in Section 10(b) hereof.
 
“ Issuer Person ”:  This term has the meaning set forth in Section 8(h) hereof.
 
“ Loss ”:  This term has the meaning set forth in Section 10(a) hereof.
 
“ Note Owners ”:  With respect to a Series 2012-1 Note that is a Book-Entry Note, the Person who is the owner of such Book-Entry Note, as reflected on the books of (i) the Depositary (a direct participant) or (ii) a Person maintaining an account with the Depositary (an indirect participant), in each case in accordance with the rules of the Depositary.
 
“ Notes ”:  Collectively, the Notes.
 
“ Offering Memorandum ”:  This term has the meaning set forth in Section 3(a) hereof.
 
“ Permitted Non-U.S. Person ”:  This term has the meaning set forth in Section 3(b) hereof.
 
“ Permitted Transferee ”:  This term has the meaning set forth in Section 3(b) hereof.
 
“ Preliminary Offering Memorandum ”:  This term has the meaning set forth in Section 3(a) hereof.
 
 
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“ Purchaser Indemnified Party ”:  This term shall have the meaning set forth in Section 10(a) hereof.
 
“ Qualified Institutional Buyers ”:  This term has the meaning set forth in Rule 144A of the Act.
 
“ Regulation S ”:  Regulation S under the Act.
 
“ Related Transferred Assets ”:   This term has the meaning set forth in the Contribution and Sale Agreement.
 
“ Series 2012-1 Notes ”: The Fixed Rate Asset Backed Notes, Series 2012-1 issued by the Issuer pursuant to the terms of the Series 2012-1 Supplement, dated as of October 18, 2012 (as amended), between the Issuer and the Indenture Trustee.
 
“ Series 2012-1 Supplement ”:  This term has the meaning set forth in Section 1(a) hereof.
 
“ UCC ”:  The Uniform Commercial Code as in effect in the applicable jurisdiction.
 
“ United States ”:  The United States of America.
 
“ U.S. Persons ”:  This term has the meaning set forth in Section 3(b) hereof.
 
All accounting terms not specifically defined herein shall be construed in accordance with GAAP. All terms used in the UCC in effect in the State of New York and not specifically defined herein, are used herein as defined therein.
 
Unless otherwise stated in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding”.
 
Section 2.             The Notes .
 
(a)           On the basis of the representations, warranties, agreements and covenants herein contained and subject to the terms and conditions herein set forth, the Issuer agrees to sell to the Initial Purchasers, and each Initial Purchaser agrees to purchase from the Issuer, on the Closing Date, the Notes in the principal amount set forth on Schedule I hereto opposite the name of such Initial Purchaser.  The Series 2012-1 Notes are to be purchased by the Initial Purchasers at a purchase price equal to 99.97845% of the aggregate principal amount thereof.  Except for any Notes issued to Institutional Accredited Investors, which Notes shall be issued as Definitive Notes, the Notes shall be Book-Entry Notes, and shall be issued to Cede & Co., as nominee of The Depository Trust Company.  The delivery of and payment for the Notes shall be made at the offices of SNR Denton US LLP, at 10:00 a.m., New York time on October 18, 2012 or at such other place, time or date as the Initial Purchasers and the Issuer may agree upon, such time and date of delivery against payment being herein referred to as the “Closing Date”.  The Issuer shall make copies of the Notes available for review by the Initial Purchasers at the offices of the Initial Purchasers at least 24 hours prior to the Closing Date.  The purchase price of the Notes paid by the Initial Purchasers shall be remitted by wire transfer to the Indenture Trustee and applied in accordance with Section 6(a)(v) hereof.  The terms of the Notes are more fully set forth in the Offering Memorandum and in the Series 2012-1 Related Documents ( provided , that in no event shall the Offering Memorandum be deemed to constitute a Series 2012-1 Related Document or shall the terms and conditions described in the Offering Memorandum be binding upon the Issuer or any party to any Series 2012-1 Related Document, except to the extent consistent with and expressly set forth in a Series 2012-1 Related Document).
 
 
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(b)           The Notes are to be issued under the Series 2012-1 Supplement.
 
(c)           The Notes shall be offered and sold to the Initial Purchasers without being registered under the Act, in reliance on exemptions thereunder.
 
Section 3.             Information .
 
(a)           In connection with the sale of the Notes, the Issuer has prepared a preliminary offering memorandum, dated October 2, 2012 (including all attachments thereto and any supplements or amendments thereto (other than the Offering Memorandum), the “ Preliminary Offering Memorandum ”) and a final offering memorandum, dated October 11, 2012 (including all attachments thereto and any supplements or amendments thereto, the “ Offering Memorandum ”).
 
(b)           The Issuer hereby expressly authorizes the Initial Purchasers to use the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum, in connection with the offer and sale of the Notes. The Issuer hereby indicates its authorization of all distributions of the Additional Disclosure Documents and the Preliminary Offering Memorandum made by the Initial Purchasers prior to the date of this Agreement and authorize the Initial Purchasers to distribute the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum in connection with the offer and sale of the Notes, provided that such distributions were or are made only to Persons that are (i) reasonably believed by the Initial Purchasers to be Qualified Institutional Buyers, (ii) institutional Accredited Investors, as defined in Rule 501(a)(1), (2), (3) or (7) under Regulation D of the Act (“ Institutional Accredited Investors ”), or (iii) to Persons that are not U.S. Persons, as defined in Regulation S (“ U.S. Persons ”); any Person described in clause (i), (ii) or (iii) being a “ Permitted Transferee ”) to whom the offer and sale of the Notes may be made without registration under the Act in reliance upon Regulation S (as defined below). The Issuer also hereby expressly authorizes the Initial Purchasers to distribute to Persons with the aforementioned qualifications, in connection with the offer and sale of the Notes, (i) any report or document filed by the Issuer, the Manager or any of their Affiliates with the Commission, and (ii) subject to terms of confidentiality set forth in Section 711 of the Supplement, copies of the Series 2012-1 Related Documents and opinion letters and other documents delivered in connection with the execution of the Series 2012-1 Related Documents.
 
(c)           The Issuer understands that the Initial Purchasers propose to make an offering of the Notes, as soon as it deems advisable after this Agreement has been executed and delivered, on the terms and in the manner set forth in the Offering Memorandum to Persons that the Initial Purchasers reasonably believe to be Permitted Transferees. Any Notes sold to Institutional Accredited Investors shall be represented by one or more Definitive Notes.
 
Section 4.             Representations and Warranties of the Issuer and CAL .  Each of the Issuer and CAL, as applicable, represents and warrants to the Initial Purchasers, as of the date hereof and as of the Closing Date (or, if specifically stated below to be made as of another particular time or date, as of such time or date instead), as follows:
 
 
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(a)           At 11:33 a.m. on October 10, 2012, the time of the first contract of sale by the Initial Purchasers for any Notes (the “ Time of Sale ”), none of the Additional Disclosure Documents or the Preliminary Offering Memorandum contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and (ii) the Offering Memorandum, as of its date (including any attachments, supplements or amendments thereto, as of the respective dates thereof), did not contain an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; provided , in the case of each of the foregoing clauses (i) and (ii) , that such representations and warranties do not apply to statements or omissions made in reliance upon and in conformity with the Initial Purchaser Information or the information set forth in the Preliminary Offering Memorandum or the Offering Memorandum under the heading “Structuring Assumptions”.  The statements made in the “Structuring Assumptions” section of the Preliminary Offering Memorandum and the Offering Memorandum represent the good faith estimate of the Issuer, based on assumptions that the Issuer believes to be reasonable, it being recognized, however, that such “Structuring Assumptions” sections, as expressly noted therein, contain projections, estimates and forecasts which are subject to significant contingencies and uncertainties, many of which are beyond the control of the Issuer, and no assurances are given that such projections, estimates and forecasts will be achieved.
 
(b)           The descriptions of the Series 2012-1 Related Documents contained in the Preliminary Offering Memorandum and Offering Memorandum conform in all material respects to the terms of the Series 2012-1 Related Documents.
 
(c)           The statistical and market-related data included in the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum are based on or derived from sources that the Issuer believes to be reliable and accurate in all material respects. The information concerning the Managed Containers and the Fleet that is included in the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum presents fairly in all material respects the information purported to be stated therein. There has been no material adverse change in the delinquency, loss, utilization and other information with respect to the Managed Containers or the Fleet from that set forth in the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum.
 
(d)           Each of the Issuer and CAL is duly incorporated or organized and validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization and has full power and authority to own its properties, if any, and to conduct its business as such properties presently are owned and the business presently is conducted. The Issuer had at all relevant times, and now has, all necessary power, authority and legal right to own in the manner contemplated by the Series 2012-1 Related Documents, the Managed Containers and the Related Transferred Assets.  CAL had at all relevant times, and now has, all necessary power, authority and legal right to transfer, in the manner contemplated by the Series 2012-1 Related Documents, the Managed Containers and the Related Transferred Assets.
 
 
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(e)            Each of the Issuer and CAL is duly qualified to do business and is in good standing as a foreign entity (or is exempt from such requirements), and has obtained all necessary licenses and approvals as required under Applicable Law, in each case, where the failure so to qualify, to be in good standing, to obtain such licenses and approvals or to preserve and maintain such qualification, licenses or approvals could have a material and adverse effect on its ability to perform any of its obligations under any Series 2012-1 Related Document to which it is a party.
 
(f)            The Issuer has all necessary power and authority to execute and deliver the Notes. Each Note has been duly and validly authorized by the Issuer and, from and after the date on which such Note is executed by the Issuer and authenticated by the Indenture Trustee in accordance with the terms of the Indenture and the Series 2012-1 Supplement and delivered to and paid for by the Initial Purchasers in accordance with the terms of this Agreement, shall be validly issued and outstanding and shall constitute a valid and legally binding obligation of the Issuer, entitled to the benefits of the Indenture and the Series 2012-1 Supplement and enforceable against the Issuer in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether enforceability is considered in a Proceeding in equity or at law.
 
(g)           Each of the Issuer and CAL has (i) all necessary power and authority to (A) execute and deliver this Agreement and the other Series 2012-1 Related Documents to which it is a party, and (B) perform its obligations under this Agreement and the other Series 2012-1 Related Documents to which it is a party, and (ii) duly authorized, by all necessary action, the execution, delivery and performance of this Agreement and the other Series 2012-1 Related Documents to which it is a party and the consummation of the transactions provided for in this Agreement and the other Series 2012-1 Related Documents to which it is a party.
 
(h)           Each of this Agreement and the other Series 2012-1 Related Documents to which the Issuer and/or CAL is a party, when executed and delivered by it (assuming the due authorization, execution and delivery thereof by the other parties thereto), shall constitute its legal, valid and binding agreement, enforceable against it in accordance with the terms thereof, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether enforceability is considered in a Proceeding in equity or at law.
 
(i)            This Agreement has been duly and validly executed and delivered by each of the Issuer and CAL.
 
(j)            All authorizations, consents, orders and approvals of, or other action by, any Governmental Authority or any other Person that are required to be obtained by the Issuer or CAL, as the case may be, and all notices to and filings with any Governmental Authority or any other Person that are required to be made by the Issuer or CAL, in the case of each of the foregoing in connection with the due execution, delivery, and performance by the Issuer of this Agreement and the other Series 2012-1 Related Documents to which it is a party and the consummation of the transactions contemplated by this Agreement and the Series 2012-1 Related Documents to which it is a party (including transfers to the Issuer of the Managed Containers and the Related Transferred Assets), have been obtained or made and are in full force and effect except where the failure to obtain or make any such authorization, consent, order, approval, action, notice or filing, individually or in the aggregate for all such failures, would not reasonably be expected to have a material and adverse effect on the ability of the Issuer or CAL, to perform any of its obligations under any Series 2012-1 Related Document to which it is a party.
 
 
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(k)           The execution, delivery and performance of, and the consummation of the transactions contemplated by, this Agreement and the other Series 2012-1 Related Documents and the fulfillment of the terms hereof and thereof by the Issuer do not (i) conflict with, violate, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time or both) a default under, (A) the constitutional or organizational documents of the Issuer or CAL, as the case may be, or (B) any material contract, indenture, loan agreement, mortgage, deed of trust or other agreement or instrument to which the Issuer or CAL is a party or by which the Issuer or any of its properties is bound, (ii) result in the creation or imposition of any Lien upon any of the properties of the Issuer or CAL (other than as contemplated by the Series 2012-1 Related Documents), or (iii) conflict with or violate any federal, state, local or foreign law or any decision, decree, order, rule or regulation of any Governmental Authority applicable to the Issuer or CAL, as the case may be, or any of its respective properties, in the case of each of the foregoing clauses (i) through (iii) , which conflict, violation, breach, default or Lien, individually or in the aggregate, would have a substantial likelihood of having a material and adverse effect on the ability of the Issuer or CAL, as the case may be, to perform any of its obligations under any Series 2012-1 Related Document to which it is a party.
 
(l)            Except as disclosed in the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum, since September 13, 2012 (the date of Issuer's incorporation), (i) there has been no material adverse change in the condition, financial or otherwise, or the earnings, business affairs or business prospects of the Issuer, whether or not arising in the ordinary course of business, and (ii) there have been no transactions entered into by the Issuer that are material with respect to the Issuer and that would be required to be disclosed under Applicable Law in connection with the offering, sale or resale of the Notes.
 
(m)           There is no Proceeding or investigation pending or, to the best knowledge of the Issuer or CAL, as the case may be, threatened against it before any court, regulatory body, arbitrator, administrative agency or other tribunal or governmental instrumentality, and none of the Issuer or CAL is subject to any order, judgment, decree, injunction, stipulation or consent order of or with any court or other Governmental Authority that (i) asserts the invalidity of this Agreement or any other Series 2012-1 Related Document, (ii) seeks to prevent any transfer to the Issuer of any Managed Container or Related Transferred Asset, the issuance of the Notes or the consummation of any transactions contemplated by this Agreement or any other Series 2012-1 Related Document, (iii) seeks any determination or ruling that would materially and adversely affect the performance by the Issuer or CAL of its respective obligations under this Agreement or any other Series 2012-1 Related Document or the validity or enforceability of this Agreement or any other Series 2012-1 Related Document, in the case of each of the foregoing clauses (i) through (iii) , which individually or in the aggregate for all such actions, suits, Proceedings, investigations, orders, judgments, decrees, injunctions, stipulations or consent orders would have a substantial likelihood of having a material and adverse effect on the ability of the Issuer or CAL to perform any of its respective obligations under any Series 2012-1 Related Document to which it is a party.
 
 
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(n)           Neither this Agreement, the other Series 2012-1 Related Documents nor any transaction contemplated herein or therein or in the Additional Disclosure Documents, the Preliminary Offering Memorandum or the Offering Memorandum results in a violation of, or gives rise to an obligation on the part of any Noteholder or Note Owner to register, file or give notice under, Regulations T, U or X of the Federal Reserve Board or any other regulation issued by the Federal Reserve Board pursuant to the Exchange Act, in each case as in effect on the Closing Date.
 
(o)           The Issuer is not, and is not controlled by, an “investment company” registered or required to be registered under the Investment Company Act.
 
(p)           Neither the Issuer nor any of its “affiliates” (as defined in Regulation D under the Act) has directly, or through any agent, (i) sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any “security” (as defined in the Act) that is or shall be integrated with the sale of the Notes in a manner that would require the registration under the Act of the offering of the Notes or (ii) assuming the accuracy of the representations and warranties of the Initial Purchasers in Section 9 hereof, engaged in any form of general solicitation or general advertising in connection with the offering of the Notes (as those terms are used in Regulation D under the Act) or in any manner involving a public offering of the Notes within the meaning of Section 4(2) of the Act.
 
(q)           Neither the Issuer nor any of its Affiliates or any Person acting on its behalf has engaged in any directed selling efforts (as that term is defined in Regulation S) with respect to any Notes (provided that no representation is made as to the actions of the Initial Purchasers or any Person acting on its behalf). The Issuer and its Affiliates and any Person acting on its behalf (provided that no representation is made as to the actions of the Initial Purchasers or any Person acting on its behalf) have complied with the offering restrictions and the requirements of Regulation S in connection with any offering of Notes outside the United States.
 
(r)            Assuming the representations and warranties of the Initial Purchasers in Section 9 hereof are true, it is not necessary in connection with the offer, sale and delivery of the Notes in the manner contemplated by this Agreement, the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum to register any of the Notes under the Act or to qualify the Indenture under the Trust Indenture Act of 1939, as amended.
 
(s)           On the date hereof and the Closing Date, (i) each of the representations and warranties of the Issuer and CAL that is set forth in this Agreement, the Indenture or the other Series 2012-1 Related Documents is true and correct, and (ii) none of the Issuer or CAL is or shall be in breach of any covenant or agreement set forth in this Agreement, the Indenture or any other Series 2012-1 Related Document.  The Initial Purchasers may rely on the representations and warranties of the Issuer and CAL in any Series 2012-1 Related Document as if such representations and warranties were set forth in this Agreement in full.
 
(t)            No Early Amortization Event or Event of Default, or event which with the giving of notice or passage of time or both would become an Early Amortization Event or Event of Default, exists.
 
 
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(u)           The Notes meet the eligibility requirements of Rule 144A(d)(3) of the Act.
 
(v)           Neither the Issuer nor any of its Affiliates has purchased, or is purchasing, any Notes.
 
(w)           The Issuer has not taken, directly or indirectly, any action prohibited by Rule 102 of Regulation M under the Exchange Act.
 
(x)           The Issuer reasonably believes that based on the procedures it has put in place in connection with the Series 2012-1 Related Documents (and assuming compliance by the Initial Purchasers) to ensure that all purchasers and transferees of the Series 2012-1 Notes are Permitted Transferees, the sale of the Series 2012-1 Notes to the initial Series 2012-1 Noteholders and the subsequent transfers of the Series 2012-1 Notes will only be made to Permitted Transferees as set forth above and in accordance with the Indenture.
 
(y)           CAL has executed and delivered a written representation (the “ 17g-5 Representation ”) to Standard & Poor’s that CAL will comply with the requirements applicable to sponsors as and to the extent required under Rule 17g-5(a)(3)(iii)(A) through (D) under the U.S. Securities Exchange Act of 1934, as amended (“ Rule 17g-5 ”) with respect to the Notes, and CAL has complied with the 17g-5 Representation .
 
Section 5.             Offering by the Initial Purchasers .
 
(a)           The Initial Purchasers propose to make an offering of the Notes, upon the terms set forth in the Offering Memorandum, as soon as practicable after this Agreement is entered into and as in its judgment is advisable. During the period from the date of this Agreement until the Initial Purchasers have sold all of the Notes, the Issuer agrees (i) to reasonably assist the Initial Purchasers in any marketing of the Notes and (promptly upon request) to provide all information reasonably deemed necessary by the Initial Purchasers in such marketing and (ii) to use commercially reasonable efforts to make appropriate officers and representatives of the Issuer available to participate in information meetings for potential Series 2012-1 Noteholders at such times and places as the Initial Purchasers may reasonably request.
 
(b)           Each of the Issuer and CAL acknowledges and agrees that each Initial Purchaser is acting solely in the capacity of an arm’s length contractual counterparty to the Issuer with respect to the offering of the Notes contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Issuer or any other Person.  Additionally, the Initial Purchasers are advising the Issuer or any other Person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction.  Each of the Issuer and CAL shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and the Initial Purchasers shall have responsibility or liability to the Issuer or any other Person with respect thereto. Any review by the Initial Purchasers of the Issuer or CAL, the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Initial Purchasers and shall not be on behalf of the Issuer, CAL or any other party.
 
(c)           The Issuer acknowledges and agrees that:
 
 
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(i)           the Issuer has been advised that each Initial Purchaser and its Affiliates are engaged in a broad range of transactions which may involve interests that differ from those of the Issuer and that such Initial Purchaser has no obligation to disclose such interests and transactions to the Issuer by virtue of any fiduciary, advisory or agency relationship; and
 
(ii)           the Issuer waives, to the fullest extent permitted by law, any claims it may have against the Initial Purchasers for breach of fiduciary duty or alleged breach of fiduciary duty and agrees that the Initial Purchasers shall have liability (whether direct or indirect) to the Issuer in respect of such a fiduciary duty claim or to any Person asserting a fiduciary duty claim on behalf of or in right of the Issuer, including stockholders, employees or creditors of the Issuer.
 
Section 6.             Covenants of the Issuer and CAL .  The Issuer covenants and agrees with the Initial Purchasers that:
 
(a)         The Issuer shall not amend or supplement the Additional Disclosure Documents, the Preliminary Offering Memorandum, the Offering Memorandum or any amendment thereof or supplement thereto unless the Initial Purchasers previously shall have been advised thereof and been furnished a copy thereof prior to the proposed amendment or supplement and shall have been given a reasonable opportunity to review such amended and supplemented Preliminary Offering Memorandum or Offering Memorandum, or amendment or supplement thereto as the case may be (but in no event shall such period be less than five (5) Business Days). During the period beginning on the date hereof and ending on the date on which the Initial Purchasers shall have sold all of the Notes purchased by it hereunder, the Issuer shall, promptly upon the reasonable request by the Initial Purchasers, prepare any amendments of or supplements to the Offering Memorandum that, in the opinion of the Initial Purchasers, may be necessary or advisable in connection with the resale of the Notes by the Initial Purchasers.  During the period beginning on the date hereof and ending on the date on which the Initial Purchasers shall have sold all of the Notes, the Issuer shall, to the extent practicable (taking into account the disclosure requirements and restrictions imposed by Applicable Law), supply the Initial Purchasers with drafts or duplicate copies of any reports required to be filed by the Issuer with the Commission at least two (2) Business Days prior to any such filing, and in any event shall supply such reports to the Initial Purchasers concurrently with any such filing thereof.
 
(b)         The Issuer shall take any action for the qualification or exemption of the Notes for offer, sale and resale under the securities or “Blue Sky” laws of any state that the Initial Purchasers shall reasonably request and shall pay all reasonable expenses (including reasonable fees and disbursements of counsel) in connection with the qualification or exemption and in connection with the determination of the eligibility of the Notes for investment under the laws of the jurisdictions that the Initial Purchasers may designate.  Thereafter, while any of the Notes remain Outstanding, the Issuer shall arrange for the filing and making of, and shall pay all fees applicable to, any statements and reports and renewals of registration necessary in order to continue to qualify or exempt the Notes for secondary market transactions in those jurisdictions in which the Notes were originally registered or exempted for sale in accordance with the preceding sentence.  If the Initial Purchasers shall pay any of the fees or expenses referred to in this Section 6(a)(ii) , the Issuer shall promptly reimburse the Initial Purchasers; it being understood and agreed that the reimbursement shall not be subject to any limitations on reimbursement set forth in Section 7 hereof.
 
 
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(c)         If, at any time prior to the time at which the Initial Purchasers shall have sold all of the Notes, any event occurs or condition exists as a result of which it is necessary or desirable, in the reasonable opinion of the Initial Purchasers or the Issuer, to amend or supplement the Offering Memorandum in order that the Offering Memorandum shall not include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made or existing at the time the Offering Memorandum is delivered to a prospective Series 2012-1 Noteholder not misleading, or if for any other reason it is necessary at any time to amend or supplement the Offering Memorandum to comply with Applicable Law, the Issuer shall promptly notify the Initial Purchasers or the Initial Purchasers shall promptly notify the Issuer thereof, as applicable, and the Issuer shall prepare and deliver to the Initial Purchasers, at the expense of the Issuer, an amendment of or supplement to the Offering Memorandum that (i) corrects the statement or omission or (ii) effects such compliance, as the case may be.
 
(d)         The Issuer shall, without charge, provide to the Initial Purchasers as many copies of the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum as the Initial Purchasers may reasonably request.
 
(e)         The Issuer shall apply the proceeds from the sale of the Notes (i) to pay the purchase price relating to the acquisition by the Issuer from the Seller of Sold Assets pursuant to the terms of the Contribution and Sale Agreement, (ii) to fund the initial deposits to the Restricted Cash Account, (iii) to pay the costs of issuance of the Notes and (iv) for other general business purposes. The Issuer shall not use the proceeds of the sale of the Notes or any part thereof, directly or indirectly, to purchase or carry any “margin security” (as defined in Regulations T, U or X issued by the Federal Reserve Board) or to reduce or retire any indebtedness originally incurred to purchase any margin security.
 
(f)          Neither the Issuer nor any of its “affiliates” (as defined in Regulation D under the Act), directly or through any agent, shall sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any “security” (as defined in the Act) that is or that could be integrated with the sale of the Notes in a manner that would require the registration of the Notes under the Act.
 
(g)         The Issuer shall not, and shall not permit any of its “affiliates” (as defined in Regulation D under the Act) to, directly or through any agent, solicit any offer to buy or offer to sell the Notes by means of any form of general solicitation or general advertising (as those terms are used in Regulation D under the Act) or in any manner involving a public offering within the meaning of Section 4(2) of the Act.
 
(h)         Neither the Issuer nor any of its Affiliates or any Person acting on its behalf ( provided that no covenant is made as to the actions of the Initial Purchasers or any Person acting on its behalf) shall engage in any directed selling efforts (as that term is defined in Regulation S) with respect to any Notes, and the Issuer, all of its Affiliates and any Person acting on its behalf shall comply with the offering restrictions and the requirements of Regulation S in connection with the offering of Notes outside the United States.
 
 
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(i)           The Issuer shall not contact or solicit potential investors to purchase any Note, engage any Person to assist in the placement or sale of the Notes or sell any Notes to any Person, in the case of each of the foregoing, other than the Initial Purchasers except as consented to in writing by the Initial Purchasers.
 
(j)           So long as any of the Notes are “restricted securities” within the meaning of Rule 144 under the Act, the Issuer shall, unless it becomes subject to and complies with the reporting requirements of Section 13 or 15(d) of the Exchange Act, provide to any Series 2012-1 Noteholder or Note Owner, and to any prospective Series 2012-1 Noteholder or Note Owner designated by a Series 2012-1 Noteholder or Note Owner, upon the request of such Series 2012-1 Noteholder or Note Owner or prospective Series 2012-1 Noteholder or Note Owner, any information required to be provided by Rule 144A(d)(4) under the Act. This covenant is intended to be for the benefit of the Series 2012-1 Noteholders and Note Owners, and prospective Series 2012-1 Noteholders and Note Owners designated by such Series 2012-1 Noteholders or Note Owners, from time to time of such restricted securities.
 
(k)         The Issuer shall cause the Notes to be eligible for clearance and settlement through The Depository Trust Company, Clearstream and the Euroclear Clearing System.
 
(l)          The Issuer shall not sell or otherwise transfer any Notes that have been acquired by it.
 
(m)        Except with respect to the Notes to be issued on the Closing Date, during the period commencing on the date hereof and ending on the thirtieth (30 th ) day after the Closing Date, the Issuer shall not cause or permit any of its Affiliates to make or issue any borrowings, debt instruments or securities similar to the Notes (whether issued or guaranteed by the Issuer or any of its Affiliates), which are either placed or syndicated by the Issuer or any of its Affiliates in the international or U.S. capital markets, directly or on their behalf, in any manner which could in the sole judgment of the Initial Purchasers have a detrimental effect on the successful offering, sale or resale of the Notes unless mutually agreed to in writing by the Initial Purchasers and the Issuer.
 
(n)         Neither the Issuer nor any Person acting on its behalf shall make offers or sales of securities under circumstances that would require the registration of the Notes under the Act or permit the Issuer to become an “investment company” registered or required to be registered under the Investment Company Act.
 
(o)         If the ratings assigned to the Notes are dependent upon the delivery to the applicable Rating Agency of the executed Series 2012-1 Related Documents, the Issuer shall deliver the required copies of such documents to such Rating Agency within thirty (30) days after the Closing Date.
 
(p)         Neither the Issuer, nor any of its Affiliates, nor any Person acting on its behalf (provided that no covenant is made as to the actions of the Initial Purchasers or any Person acting on their behalf) will sell the Notes by means of any general solicitation or general advertising within the meaning of Rule 502(c) under the Securities Act.
 
 
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(q)         From the date hereof and prior to the Closing Date, the Issuer will notify the Initial Purchasers with respect to the suspension of the qualification of the Series 2012-1 Notes for sale in any jurisdiction or the initiation of any Proceeding for such purpose (to the extent the Issuer is aware of any such suspension or the initiation of any such Proceeding).
 
(r)           During the period of two years after the Closing Date, the Issuer will not be or become an open-end investment company, unit investment trust or face-amount certificate company that is or is required to be registered under Section 8 of the Investment Company Act.
 
CAL covenants and agrees with the Initial Purchasers that it will comply, and will cause each of the Issuer and CAL to comply, with the 17g-5 Representation.
 
Section 7.             Expenses; Fees .  In addition to the rights of indemnification granted to the Purchaser Indemnified Parties under Section 10, the Issuer covenants and agrees with the Initial Purchasers that the Issuer will pay or cause to be paid the following: (i) the fees, disbursements and expenses of the Issuer’s counsel and accountants in connection with the registration of the Notes under the Act and all other expenses in connection with the preparation, printing, reproduction and filing of the Additional Disclosure Documents, the Preliminary Offering Memorandum or the Offering Memorandum and the mailing and delivering of copies thereof to the Initial Purchasers and dealers; (ii) the cost of printing or reproducing this Agreement, the Indenture, any Blue Sky Memorandum and any other documents in connection with the offering, purchase, sale and delivery of the Notes; (iii) all expenses in connection with the qualification of the Notes for offering and sale under state securities laws as provided in Section 6(a)(ii) hereof, including the reasonable fees and disbursements of counsel for the Initial Purchasers in connection with such qualification and in connection with the Blue Sky survey(s); (iv) any fees charged by securities rating services for rating the Notes; (v) any filing fees incident to, and the fees and disbursements of counsel for the Initial Purchasers in connection with, any required reviews by the Financial Industry Regulatory Authority of the terms of the sale of the Notes; (vi) the cost of preparing certificates for the Notes; (vii) all expenses incurred by the Issuer in connection with any “road show” presentation to potential investors, (viii) the fees and expenses of the Indenture Trustee and any agent of the Indenture Trustee and the fees and disbursements of counsel for the Indenture Trustee in connection with the Indenture and the Notes; (ix) all costs and expenses incurred by any Purchaser Indemnified Party with respect to enforcing its respective rights and remedies as against the Issuer or CAL under this Agreement, the Indenture, any Series 2012-1 Note, any other Series 2012-1 Related Document to which the Issuer or CAL is a party, (x) all costs and expenses incurred in connection with the amendment or modification of, or any waiver or consent, made at the request of the Issuer, CAL or any of its respective Affiliates, and issued in connection with, this Agreement, the Indenture, any Series 2012-1 Note, any other Series 2012-1 Related Document to which the Issuer or CAL is a party and (xi) all other costs and expenses incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this Section. It is understood, however, that, except as provided in this Section 7 and Sections 10 and 12, the Initial Purchasers will pay all of its own costs and expenses, including transfer taxes on resale of any of the Notes by the Initial Purchasers, and any advertising expenses connected with any offers the Initial Purchasers may make.
 
 
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Section 8.             Conditions of the Initial Purchasers’ Obligations . The obligations of each Initial Purchaser to purchase and pay for Notes in an amount equal to the principal amount set forth on Schedule I hereto opposite its name shall, in its sole discretion, be subject to the satisfaction of all of the following conditions on the Closing Date:
 
(a)           The Issuer shall have good title to the Managed Containers and the other Collateral, free and clear of all Liens other than Permitted Encumbrances.
 
(b)           The Issuer shall have (i) caused all Uniform Commercial Code financing statements (or documents of similar import) required to perfect the first priority security interest of the Indenture Trustee pursuant to the Indenture in the Collateral and related items, in each case, to be duly filed in the manner required by the laws of each appropriate jurisdiction, (ii) caused all Uniform Commercial Code financing statements (or documents of similar import) required to perfect the first priority security interest of the Issuer (and the Indenture Trustee as assignee of the Issuer) pursuant to the Contribution and Sale Agreement and (iii) paid, or caused to be paid, all transfer taxes, documentary stamp taxes and filing fees incurred in connection therewith.
 
(c)           All corporate and other proceedings in connection with the transactions contemplated hereby and by the Series 2012-1 Related Documents and all documents incidental thereto shall be satisfactory in form and substance to such Initial Purchaser and its counsel, and such Initial Purchaser shall have received its Notes and any other documents incident to the transactions contemplated hereby and by the Series 2012-1 Related Documents that such Initial Purchaser or its counsel shall reasonably request.  Each Initial Purchaser or its counsel shall have received on the Closing Date certified copies of all documents evidencing corporate or other organizational action taken by the Issuer, CAL and the Indenture Trustee to approve the execution and delivery of this Agreement and the other Series 2012-1 Related Documents to which they are a party and the consummation of the transactions contemplated hereby and thereby.
 
(d)           The Series 2012-1 Related Documents and the Notes shall conform in all material respects to the descriptions thereof contained in the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum.  Immediately prior to the sale of the Notes to the Initial Purchasers, the Notes shall have been executed by the Issuer and authenticated by or on behalf of the Indenture Trustee, and this Agreement and each of the other Series 2012-1 Related Documents that is to be executed and delivered on or prior to the Closing Date shall have been executed and delivered by the Issuer, the Manager and all other parties thereto.  The Initial Purchasers and the Indenture Trustee shall have received on the Closing Date a true and correct copy of each Series 2012-1 Related Document delivered on or prior to the Closing Date, and the Initial Purchasers or their authorized representative shall have received its original Notes.
 
(e)            Each Initial Purchaser or its counsel shall have received on the Closing Date signature and incumbency certificates executed by Authorized Signatories of the Issuer, CAL and the Indenture Trustee certifying the identities and signatures of those officers who executed each of this Agreement and the other Series 2012-1 Related Documents delivered in connection with Series 2012-1 to which the Issuer, CAL or the Indenture Trustee, as the case may be, is a party.
 
 
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(f)            The purchase of the Notes by each Initial Purchaser shall be permitted by the laws and regulations to which such Initial Purchaser is subject.
 
(g)           Each of the Notes shall have been rated “A(sf)” by Standard & Poor’s, each such rating shall be in full force and effect and the Initial Purchasers shall have received on the Closing Date a letter from Standard & Poor’s dated on or before the Closing Date to such effect.
 
(h)           Subsequent to the respective dates as of which information is given in the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum, there shall not have occurred (i) any material adverse change, or any development involving a prospective material adverse change, in the condition (financial or otherwise) or in the earnings, business, operations or business prospects of the Issuer, the Manager or CAL (collectively, an “ Issuer Person ”), whether or not arising in the ordinary course of business that, in the sole judgment of the Initial Purchasers, makes it impracticable or inadvisable to purchase the Notes or to proceed with the offering, sale, resale or delivery of the Notes, (ii) any other event or occurrence that could have a material adverse effect on the ability of the Issuer to perform any of its obligations under any Series 2012-1 Related Document to which it is a party or a material adverse effect on the value of the Managed Containers or the rights and remedies of the Indenture Trustee or any Series 2012-1 Noteholder under any Series 2012-1 Related Document, that, in the sole judgment of the Initial Purchasers, makes it impracticable or inadvisable to purchase the Notes or to proceed with the offering, sale, resale or delivery of the Notes, (iii) a general moratorium on commercial banking activities declared by any state of the United States or United States authorities, (iv) any downgrading in, or withdrawal of, the rating (including any “shadow rating”) accorded to securities (or the placement of any such securities on any watch or similar list with negative implications) issued by any Issuer Person or the Notes of any other Series previously issued by the Issuer by any “nationally recognized statistical rating organization,” as that term is defined for purposes of Rule 436(g) under the Act, or any public announcement that any such organization has under surveillance or review its rating (including any “shadow rating”) of the Notes of any other Series previously issued by the Issuer (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of the rating), (v) any outbreak or escalation of hostilities, insurrection or armed conflict in which the United States of America is involved, any declaration of war by Congress or any other national or international calamity or emergency that in the sole judgment of the Initial Purchasers makes it impractical or inadvisable to purchase the Notes or to proceed with the offering, sale, resale or delivery of the Notes, or (vi) any material adverse change in financial, political or economic conditions having an effect on the U.S. or Western European financial markets that in the sole judgment of the Initial Purchasers makes it impractical or inadvisable to purchase the Notes or to proceed with the offering, sale, resale or delivery of the Notes.
 
(i)            Each Initial Purchaser shall have received opinions, dated the Closing Date, addressed to such Initial Purchaser and in form and substance satisfactory to its counsel, of (i) Perkins Coie LLP, U.S. counsel to the Issuer and the Seller,  as to (A) perfection of the Indenture Trustee’s interest in the Collateral and other UCC matters, (B) “true sale” and substantive consolidation, (C) corporate, tax and other matters, and (D) securities laws matters; (ii) Conyers Dill & Pearman Limited, special Bermuda counsel to the Issuer, as to (A) certain matters related to priority of the Indenture Trustee’s interest in the Collateral under Bermuda law, (B) corporate, tax and other matters, and (C) securities law matters; (iii) Clarke Gittens Farmer, special Barbados counsel to the Seller, as to (A) substantive consolidation and choice of law, and (B) corporate and other matters relating thereto and (iv) counsel to the Indenture Trustee, as to certain matters relating to the Indenture Trustee.
 
 
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(j)             Each Initial Purchaser shall have received a negative assurance letter, dated the Closing Date, addressed to such Initial Purchaser and in form and substance satisfactory to its counsel, of Perkins Coie LLP, U.S. counsel to the Issuer.
 
(k)            Each Initial Purchaser shall have received one or more letters from an Independent Accountant each dated the date of the Preliminary Offering Memorandum (with respect to the Preliminary Offering Memorandum) and the Closing Date (with respect to the Offering Memorandum), in form and substance satisfactory to such Initial Purchaser and its counsel, containing statements and information of the type ordinarily included in accountants’ “comfort letters” with respect to information contained in the Preliminary Offering Memorandum and the Offering Memorandum.
 
(l)            The representations and warranties of the Issuer contained in this Agreement and in the other Series 2012-1 Related Documents to which it is a party shall be true and correct as of the date hereof and as of the Closing Date.  The Issuer shall have performed all covenants and agreements and satisfied all conditions on its part to be performed or satisfied hereunder and under the Series 2012-1 Related Documents on or prior to the Closing Date; since December 31, 2011, there has been no material adverse change in the business, condition (financial or otherwise) or results of operations or business prospects of the Issuer; and no event shall have occurred and no condition shall exist that would constitute (or which with the giving of notice or passage of time or both would constitute) an Early Amortization Event or an Event of Default.
 
(m)           Subsequent to the respective dates as of which information is given in the Preliminary Offering Memorandum and the Offering Memorandum, other than as contemplated by the Preliminary Offering Memorandum and the Offering Memorandum, neither the Issuer nor any Issuer Person shall have entered into any transactions that are material to the business, condition (financial or otherwise) or results of operations or business prospects of Issuer or any Issuer Person, respectively.
 
(n)           Each Initial Purchaser shall have received a certificate of the Issuer, dated the Closing Date, signed on its behalf by its President or any Vice President and its Chief Financial Officer or if such entity has none, its Treasurer, to the effect that:
 
(a)           The conditions precedent set forth in Section 8(l) have been satisfied.
 
(i)           Subsequent to the respective dates as of which information is given in the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum, other than as contemplated by the Offering Memorandum, there has not occurred (A) any material adverse change, or any development involving a prospective material adverse change, in the condition (financial or otherwise) or in the earnings, business, operations or business prospects of the Issuer, whether or not arising in the ordinary course of business, or (B) any other event or occurrence that would have a material and adverse effect on the ability of the Issuer to perform any of its obligations under any Series 2012-1 Related Document to which it is a party.
 
 
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(ii)           Subsequent to the respective dates as of which information is given in the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum, other than as contemplated by the Offering Memorandum, the Issuer has not entered into any transactions that are material and adverse to the business, condition (financial or otherwise) or results of operations or business prospects of the Issuer.
 
(iii)           As of the Closing Date, none of the Additional Disclosure Documents, the Preliminary Offering Memorandum and the Offering Memorandum contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that this representation shall not apply to statements or omissions made in reliance upon and in conformity with the Initial Purchaser Information.
 
(o)           Each Initial Purchaser shall have received confirmation that the Notes have been accepted for clearance of secondary market trading by The Depository Trust Company.
 
(p)           The Offering Memorandum shall have been distributed to the Initial Purchasers not later than 10:00 a.m., New York time on October 11, 2012.
 
(q)           All conditions to the issuance of the Notes set forth in the Indenture (including the execution and delivery of a control agreement with respect to the Series 2012-1 Series Account, in form and substance satisfactory to the Initial Purchasers) shall have been satisfied. The Issuer shall have delivered a certificate to that effect to the Initial Purchasers, and all opinions delivered in connection with the satisfaction of such conditions shall be addressed to the Initial Purchasers.
 
(r)            This Agreement has not terminated pursuant to Section 12 hereof.
 
(s)           The outstanding principal balance of all Series of Notes then Outstanding does not exceed the Asset Base.
 
(t)            A list (which may be in the form of a data file) of Managed Containers as of the Closing Date, which includes the Container Identification Number for each such Managed Container, shall have been delivered, in form and substance satisfactory to the Initial Purchasers.
 
(u)           All of the conditions precedent to the authentication of the Series 2012-1 Notes set forth in the Series 2012-1 Supplement shall have been satisfied or waived.
 
(v)           The Issuer shall furnish to the Initial Purchasers and the Rating Agency (x) such other agreements, instruments, documents, opinions, certificates, letters and schedules as the Initial Purchasers or their counsel or the Rating Agency or its counsel reasonably may request and (y) originals and conformed copies of all opinions, certificates, letters, schedules, agreements, documents and instruments delivered pursuant to this Agreement in the quantities that the Initial Purchasers or such Rating Agency, as the case may be, may reasonably request.
 
 
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Section 9.              Representations, Warranties and Covenants of the Initial Purchasers .  Each Initial Purchaser represents and warrants to the Issuer that:
 
(a)            Such Initial Purchaser is a Qualified Institutional Buyer.
 
(b)           Such Initial Purchaser will not offer or sell, and has not offered or sold any Notes except (x) within the United States to Persons reasonably believed by it to be (i) Qualified Institutional Buyers in reliance on the exemption from registration provided by Rule 144A or (ii) Institutional Accredited Investors and (y) to certain non-U.S. Persons outside the United States within the meaning of, and in compliance with, Regulation S.
 
(c)            Such Initial Purchaser has not engaged in any form of general solicitation or general advertising in connection with the offering or sale of the Notes (as those terms are used in Regulation D under the Act).
 
(d)           Such Initial Purchaser represents that (a) either (1) it is not, and is not acting on behalf of, a Plan or a governmental, church or non-U.S. plan which is subject to any federal, state, local or non-U.S. law that is similar to the prohibited transaction provisions of Section 406 of ERISA or Section 4975 of the Code, and no part of the assets to be used by it to purchase or hold the Notes or any interest therein constitutes the assets of any Plan or such a governmental, church or non-U.S. plan; or (2) (A) the acquisition, holding and disposition of the Note will not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or, in the case of a governmental, church or non-U.S. plan, a violation of any similar federal, state, local or non-U.S. law) and (B) the Notes are rated investment grade or better and such Person believes that the Notes are properly treated as indebtedness without substantial equity features for purposes of Section 2510.3-101 of the regulations issued by the U.S. Department of Labor, and agrees to so treat the Notes; and (b) it will not sell or otherwise transfer the Notes or any interest therein otherwise than to a purchaser or transferee that represents and agrees with respect to its purchase, holding and disposition of the Notes to the same effect as the purchaser’s representation and agreement set forth in this sentence (which representation and agreement may be effected through the deemed representation to such effect contained in the Preliminary Offering Memorandum and in the Offering Memorandum).
 
(e)            Such Initial Purchaser will not offer or sell any Note except on the terms contemplated by the Offering Memorandum.
 
(f)            None of the Initial Purchasers, their Affiliates or any Person acting on its behalf has engaged or will engage in any directed selling efforts within the meaning of Regulation S with respect to the Notes, and the Initial Purchasers, their Affiliates and all Persons acting on its behalf have complied and will comply with the offering restrictions requirements of Regulation S in connection with the offering of Notes outside of the United States.
 
(g)           Such Initial Purchaser represents and agrees that (i) it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section of the Financial Services and Markets Act 2000 (the “ FSMA ”)) received by it in connection with the issue or sale of any Notes in circumstances in which section 21(1) of the FSMA does not apply to the Issuer; and (ii) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Notes in, from or otherwise involving the United Kingdom.
 
 
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Section 10.             Indemnification and Contribution .
 
(a)           The Issuer and CAL, jointly and severally, agree to indemnify and hold harmless each Initial Purchaser, its Affiliates, together with its successors, directors and officers and each Person who controls such Initial Purchaser within the meaning of Section 15 of the Act or Section 20 of the Exchange Act (each, a “ Purchaser Indemnified Party ”), against any and all losses, claims, damages or other liabilities, joint or several (collectively, “ Losses ”), to which such Purchaser Indemnified Party may become subject, insofar as such Losses arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Additional Disclosure Documents, the Preliminary Offering Memorandum or the Offering Memorandum, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse, as incurred, each Purchaser Indemnified Party for any legal or other expenses reasonably incurred by such Purchaser Indemnified Party in connection with investigating or defending any claim, action, litigation, investigation or proceeding whatsoever (whether or not such Purchaser Indemnified Party is a party thereto), whether commenced or threatened; provided, however , that neither the Issuer nor CAL shall be liable in any case under this Section 10(a) to the extent that any Loss arises out of or is based upon any untrue statement or alleged untrue statement or omission or alleged omission made in the Additional Disclosure Documents, the Preliminary Offering Memorandum or the Offering Memorandum that, in the case of each of the foregoing, is made in reliance upon and in conformity with the Initial Purchaser Information.
 
(b)           Each Initial Purchaser severally agrees to indemnify and hold harmless each of the Issuer, CAL, their respective directors, officers, employees, agents and representatives and each Person, if any, who controls the Issuer or CAL within the meaning of Section 15 of the Act or Section 20 of the Exchange Act (collectively, the “ Issuer Indemnified Parties ”; collectively with the Purchaser Indemnified Parties and in their respective capacities as such, the “ Indemnified Parties ”), against any Losses to which such Issuer Indemnified Party may become subject, under the Act, the Exchange Act, other Federal or state statutory law or regulation or otherwise, insofar as the Losses (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Additional Disclosure Documents, the Preliminary Offering Memorandum or the Offering Memorandum, or arise out of or are based upon the omission or the alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein in the light of the circumstances under which they were made, not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Additional Disclosure Documents, the Preliminary Offering Memorandum or the Offering Memorandum in reliance upon and in conformity with the Initial Purchaser Information provided by such Initial Purchaser.  The Initial Purchasers will reimburse each Issuer Indemnified Party for any legal or other expenses reasonably incurred by such Issuer Indemnified Party in connection with investigating or defending any claim, action, litigation, investigation or proceeding whatsoever (whether or not such Issuer Indemnified Party is a party thereto), whether commenced or threatened, based upon any such untrue statement or alleged untrue statement or omission or alleged omission, as such expenses are incurred.
 
 
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(c)           Promptly after receipt by an Indemnified Party of notice of the commencement of any action described in Section 10(a) or (b) , the Indemnified Party shall, if a claim in respect thereof is to be made against the indemnifying party under Section 10(a) or (b) , notify the indemnifying party of the commencement thereof, but the failure so to notify the indemnifying party shall not relieve it from any liability that it may have other than under such Section 10(a) or (b) .  In case any such action is brought against any Indemnified Party, and it notifies the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such Indemnified Party (who shall not, except with the consent of the Indemnified Party, be counsel to the indemnifying party). In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all Indemnified Parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. No indemnifying party shall, without the written consent of the Indemnified Party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification may be sought hereunder (whether or not the Indemnified Party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the Indemnified Party from all liability arising out of such action or claim and (ii) does not include any statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any Indemnified Party.
 
(d)           If the indemnity provided for in Section 10(a) or (b) is unavailable or insufficient to hold harmless an Indemnified Party in respect of any Losses referred to in Section 10(a) or (b) , then each indemnifying party shall contribute to the amount paid or payable by such Indemnified Party in respect of such Losses in such proportion as is appropriate to reflect (i) the relative benefits received by the indemnifying party or parties on the one hand and the Indemnified Party on the other from the offering of the Notes or (ii) if the allocation provided by clause (i) is not permitted by Applicable Law, not only the relative benefits referred to in clause (i) but also the relative fault of the indemnifying party or parties on the one hand and the Indemnified Party on the other in connection with the untrue statement or alleged untrue statement or omission or alleged omission that resulted in such Losses.  The relative benefits received by the Issuer Indemnified Parties on the one hand and the Purchaser Indemnified Parties on the other shall be deemed to be in the same proportion as the total proceeds from the offering (before deducting expenses) received by the Issuer bear to the total underwriting discounts and commissions received by the Initial Purchasers with respect to the offering.  The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by any Issuer Indemnified Party on the one hand, or any Purchaser Indemnified Party on the other, the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.  The amount paid or payable by an Indemnified Party as a result of the Losses referred to above in this Section 10(d) shall be deemed to include any legal or other expenses reasonably incurred by such Indemnified Party in connection with investigating or defending any such action or claim.  Notwithstanding the provisions of this Section 10(d) , no Initial Purchaser shall be required to contribute any amount in excess of the amount by which the total price at which the Notes underwritten by it and distributed to the public exceeds the amount of any damages which such Initial Purchaser has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
 
 
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Section 11.            Survival of Representations and Warranties .  So long as any of the Series 2012-1 Notes shall be Outstanding and until payment and performance in full of the Aggregate Outstanding Obligations, the representations and warranties contained herein shall have a continuing effect of having been true when made.
 
Section 12.            Termination .  This Agreement may be terminated in the sole discretion of the Initial Purchasers by notice to the Issuer or CAL, as the case may be, given on or prior to the Closing Date in the event that (A) the Issuer or CAL shall have failed, refused or been unable to perform all obligations and satisfy all conditions on its part to be performed or satisfied hereunder at or prior thereto or (B) there shall have occurred any of the events or conditions set forth in Section 8(h) hereof.  Termination of this Agreement pursuant to this Section 12 shall be without liability of any party to any other party; provided that the respective agreements, covenants, indemnities and other statements set forth in this Section 12 and in Sections 7, 10, 14, 15, 17, 18, 19, 20, 21, 22, 23, 25, 26 and 27 shall remain in full force and effect regardless of any termination of this Agreement.
 
Section 13.           Initial Purchaser Information .  The Issuer acknowledges and agrees that the Initial Purchaser Information constitutes the only information furnished by the Initial Purchasers to the Issuer for purposes of inclusion in the Additional Disclosure Documents, the Preliminary Offering Memorandum or the Offering Memorandum.
 
Section 14.           Notices .  Unless otherwise provided herein, all notices required under the terms and provisions hereof shall be in writing and either delivered by hand, by mail or by facsimile, and any notice shall be effective when received at the address or facsimile number (as applicable) specified below:
 
If to the Issuer:
CAL Funding II Limited
 
Clarendon House, 2 Church Street
 
Hamilton HM 11, Bermuda
 
Attention:  The Secretary
 
Facsimile:  (441) 292-4720
 
Telephone:  (441) 298-5950
   
 
With copies to
   
 
(i) CAI International, Inc.
 
1 Market Plaza
 
Steuart Tower, Suite 900
 
San Francisco, CA 94105 USA
 
Facsimile: (415) 788-3430
 
Telephone: (415) 788-0100
 
 
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and
   
 
(ii) Container Applications Limited
 
Suite 102, Corporate Centre
 
Bush Hill, Bay Street, St. Michael
 
Barbados, West Indies
 
Facsimile: (246) 430-5312
 
Telephone: (246) 430-5310
If to CAL:
Container Applications Limited
 
Suite 102, Corporate Centre
 
Bush Hill, Bay Street, St. Michael
 
Barbados, West Indies
 
Facsimile: (246) 430-5312
 
Telephone: (246) 430-5310
 
If to the MLPFS:
Merrill Lynch Pierce, Fenner & Smith Incorporated
 
One Bryant Park, 11 th Floor
 
New York, NY 10036
 
Attention: Branden Avishar
 
Facsimile:  (704) 719-5461
   
If to the WFS:
Wells Fargo Securities, LLC
 
One Wells Fargo Center
 
301 South College Street, TW10 NC0610
 
Charlotte, North Carolina 28288-0610
 
Attention:  Jerri Kallam
 
Facsimile: (704) 374-3254

or at such other address or facsimile number as any party may designate from time to time by notice duly given to the other parties in accordance with the terms of this Section 14 .
 
Section 15.           Successors .  This Agreement shall inure to the benefit of and be binding upon the Initial Purchasers and the Issuer and their respective successors and legal representatives. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any Person, other than the parties hereto, the Indemnified Parties and their respective successors, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of such Persons, and for the benefit of no other Person. No purchaser of a Note or a beneficial interest in a Note from the Initial Purchasers shall be deemed a successor because of such purchase.
 
Section 16.           Counterparts .  This Agreement may be executed in any number of counterparts and by the different parties hereto in separate counterparts (which may include facsimile), each of which when so executed shall be deemed to be an original and all of which together shall constitute one and the same agreement.
 
 
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Section 17.           Governing Law .  THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT WITHOUT REGARD TO ANY OTHER CONFLICT OF LAWS PRINCIPLES, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
 
Section 18.           Submission to Jurisdiction .   EACH PARTY HERETO HEREBY (A) IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY NEW YORK STATE OR FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK, NEW YORK OVER ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, (B) IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE OR FEDERAL COURT, AND (C) IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING. EACH OF THE ISSUER AND CAL SHALL HAVE DELIVERED ON OR PRIOR TO THE DATE HEREOF TO THE INITIAL PURCHASERS OR THEIR COUNSEL EVIDENCE OF ACCEPTANCE BY CSC CORPORATION SERVICE COMPANY OF ITS APPOINTMENT BY THE ISSUER AND CAL, AS AGENT FOR SERVICE OF PROCESS IN NEW YORK. THE SERVICE MAY BE MADE TO THE ISSUER, CAL, OR CAI, AS THE CASE MAY BE, IN CARE OF THE PROCESS AGENT AT THE PROCESS AGENT’S ADDRESS. AS AN ALTERNATIVE METHOD OF SERVICE OTHER THAN SERVICE TO ITS RESPECTIVE APPOINTED SERVICE OF PROCESS AGENT, EACH PARTY ALSO IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY ACTION OR PROCEEDING BY THE MAILING OF COPIES OF THE PROCESS TO SUCH PARTY AT ITS ADDRESS SPECIFIED HEREIN. NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT OF ANY PARTY HERETO TO BRING ANY ACTION OR PROCEEDING AGAINST ANY OR ALL OF THE OTHER PARTIES HERETO OR ANY OF THEIR RESPECTIVE PROPERTIES IN THE COURTS OF ANY OTHER JURISDICTION.
 
Section 19.           Waiver of Jury Trial .   EACH PARTY HERETO WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER OR RELATING TO THIS AGREEMENT OR ANY OTHER RELATED DOCUMENTS OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN CONNECTION THEREWITH OR ARISING FROM ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN), ACTIONS OF ANY OF THE PARTIES HERETO OR ANY OTHER RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER RELATED DOCUMENTS, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
 
 
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Section 20.            Negotiations .  This Agreement and the other Series 2012-1 Related Documents are the result of negotiations among the parties hereto, and have been reviewed by the respective counsel to the parties hereto, and are the products of all parties hereto. Accordingly, this Agreement and the other Series 2012-1 Related Documents shall not be construed against the Initial Purchasers merely because of the Initial Purchasers’ involvement in the preparation of this Agreement and the other Series 2012-1 Related Documents.
 
Section 21.            Amendments, etc .  This Agreement may be amended and/or restated at any time but only upon the written consent of each of the parties hereto.  The parties hereto may waive the provisions of this Agreement in a writing signed by the parties hereto.
 
Section 22.           Severability of Provisions .  If any one or more of the agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid, then the unenforceable agreements, provisions or terms shall be deemed severable from the remaining agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other agreements, provisions or terms of this Agreement.
 
Section 23.           No Waiver; Cumulative Remedies .  No failure to exercise and no delay in exercising, on the part of any party hereto, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. Except as otherwise provided in this Agreement, the rights, remedies, powers and privileges herein provided are cumulative and are not exhaustive of any rights, remedies, powers and privileges provided by law.
 
Section 24.           Integration .  This Agreement contains a final and complete integration of all prior expressions by the parties hereto with respect to the subject matter hereof and shall constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof, superseding all prior oral or written understandings.
 
Section 25.           Nonpetition Covenant .  Notwithstanding any prior termination of this Agreement, each Initial Purchaser agrees that it shall not, with respect to the Issuer, institute or join any other Person in instituting any Insolvency Proceeding against or with respect to the Issuer or so long as any Notes issued by the Issuer shall be Outstanding and there shall not have elapsed one year plus one day since the last day on which any such Notes shall have been Outstanding and all other obligations of the Issuer under the Series 2012-1 Related Documents have been paid in full. The foregoing shall not limit the right of any such Person to file any claim in or otherwise take any action with respect to any such proceeding that was instituted against the Issuer by any Person other than the Initial Purchasers.  In addition, each Initial Purchaser agrees that all amounts owed to it by the Issuer shall be payable solely from amounts that become available for such payment pursuant to Section 302 of the Indenture and Section 303 of the Series 2012-1 Supplement, and no such amounts shall constitute a “claim” against the Issuer (as defined in Section 105 of the Bankruptcy Code) to the extent that they are in excess of the amounts available for their payment.
 
Section 26.           Recourse Against Certain Parties .  No recourse under or with respect to any obligation, covenant or agreement (including, without limitation, the payment of any fees or any other obligations) of any party as contained in this Agreement or any other agreement, instrument or document entered into by it pursuant hereto or in connection herewith shall be had against any administrator of such party or any incorporator, affiliate, stockholder, officer, employee, manager or director of such party or of any such administrator, as such, by the enforcement of any assessment or by any legal or equitable proceeding, by virtue of any statute or otherwise; it being expressly agreed and understood that the agreements of such party contained in this Agreement and all of the other agreements, instruments and documents entered into by it pursuant hereto or in connection herewith are, in each case, solely the corporate obligations of such party, and that no personal liability whatsoever shall attach to or be incurred by any administrator of such party or any incorporator, stockholder, affiliate, officer, employee, manager or director of such party or of any such administrator, as such, or any other of them, under or by reason of any of the obligations, covenants or agreements of such party contained in this Agreement or in any other such instruments, documents or agreements, or which are implied therefrom, and that any and all personal liability of every such administrator of such party and each incorporator, stockholder, affiliate, officer, employee, manager or director of such party or of any such administrator, as such, or any of them, for breaches by such party of any such obligations, covenants or agreements, which liability may arise either at common law or at equity, by statute or constitution, or otherwise, is hereby expressly waived as a condition of and in consideration for the execution of this Agreement.  The provisions of this Section 26 shall survive the termination of this Agreement.
 
 
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Section 27.           USA Patriot Act .  Each of the Issuer and the Manager acknowledges that the Initial Purchasers are required by U.S. Federal law, in an effort to help fight the funding of terrorism and money laundering activities, to obtain, verify and record information that identifies each person or corporation who opens an account or enters into a business relationship with a financial institution.
 
Section 28.           Confidentiality .  Each of the Initial Purchasers and the Issuer shall maintain and shall cause each of its employees and officers to maintain the confidentiality of this Agreement and the other Series 2012-1 Related Documents and the other confidential proprietary information with respect to the other parties hereto and the other parties to the Series 2012-1 Related Documents and their respective businesses obtained by it or them in connection with the structuring, negotiating and execution of the transactions contemplated herein (the “ Confidential Information ”), except that each such party and its officers, members and employees may disclose (x) the existence of this Agreement, but not the financial terms thereof and (y) any Confidential Information (i) to its external accountants, financial advisors, attorneys, and the agents of such Persons, as well as any nationally recognized statistical rating organization (an “NRSRO”) to whom any part of the Confidential Information is required to be disclosed pursuant to the terms of the Exchange Act or any rules (including Rule 17g-5) and regulations promulgated thereunder (collectively, “ Excepted Persons ”), (ii) as required by an applicable law (including, without limitation, public reporting requirements applicable to CAI) or order of any judicial or administrative proceeding, and (iii) in any suit, action, proceeding or investigation (whether in law or in equity or pursuant to arbitration) involving this Agreement for the purpose of defending itself, reducing its liability, or protecting or exercising any of its claims, rights, remedies or interests under or in connection with this Agreement (notice of which shall be given to the Issuer to the extent permitted under applicable law, rule or regulation) (in connection therewith, the Initial Purchasers agree, at the expense of the Issuer, to cooperate with the Issuer in seeking a protective order for such Confidential Information).  Notwithstanding the foregoing, the following will not constitute Confidential Information subject to this Section 28: (i) information that was already known to or in possession of any of the Initial Purchasers or any of their respective Excepted Persons prior to its disclosure to such Initial Purchaser by the Issuer pursuant to this Agreement or in contemplation of entering into this Agreement or any of the Related Documents; (ii) information that is obtained by any of the Initial Purchasers or any of their respective Excepted Persons from a third party who is not known by such Initial Purchaser to be prohibited from disclosing the information to such Initial Purchaser by a contractual or legal obligation to the Company; (iii) information that is or becomes publicly available (other than as a result of disclosure by any of the Initial Purchasers or any of their respective Excepted Persons in violation of this Agreement); or (iv) information that is independently developed, discovered or arrived at by any of the Initial Purchasers or any of their respective Excepted Persons without reference to the confidential proprietary information which is the subject of this Section 28.  Notwithstanding anything to the contrary contained herein, any of the Initial Purchasers and their respective affiliates may disclose confidential proprietary information, without notice to the Issuer, to any governmental agency, regulatory authority or self-regulatory authority (including without limitation, bank and securities examiners) having or claiming to have authority to regulate or oversee any aspect of the business of such Initial Purchaser or that of its affiliates in connection with the exercise of such authority or claimed authority.  The confidentiality obligations set forth in this Section 28 are in addition to any other confidentiality agreements or other similar documents that are in place among any of the parties hereto and their Affiliates and are not intended to amend or supersede any such agreement.
 
 
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Notwithstanding anything contained in this Agreement or in any other document, agreement or understanding relating to the transactions contemplated by this Agreement and the Series 2012-1 Related Documents, each party (and each employee, representative, or other agent of such party) is authorized to disclose to any and all persons, beginning immediately upon commencement of discussions regarding the transactions contemplated by this Agreement, and without limitation of any kind, the U.S. federal, state or local tax treatment and tax structure of such transactions, and all materials of any kind (including opinions or other tax analyses) that are provided to such party (or any employee, representative, or other agent of such party) to the extent related to such tax treatment and tax structure.  However, any information relating to the tax treatment or tax structure shall remain subject to the confidentiality provisions hereof (and the foregoing sentence shall not apply) to the extent reasonably necessary to enable the parties hereto, their respective Affiliates, and their respective Affiliates’ directors and employees to comply with applicable securities laws.  For purposes of this authorization, the “tax treatment” of a transaction means the purported or claimed tax treatment of the transaction, and the “tax structure” of a transaction means any fact that may be relevant to understanding the purported or claimed tax treatment of the transaction contemplated by the Series 2012-1 Related Documents.  None of the parties to the transactions contemplated by this Agreement provides U.S. tax advice, and each party should consult its own advisors regarding its participation in the transactions contemplated by this Agreement.
 
[Signature pages follow]
 
 
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If the foregoing correctly sets forth our understanding, please indicate your acceptance thereof in the space provided below for that purpose, whereupon this Agreement shall constitute a binding agreement among the Issuer, CAL and the Initial Purchasers.
 
  Very truly yours,
     
  CAL FUNDING II LIMITED
     
 
By:
/s/ Timothy B. Page  
 
       
 
Name:
Timothy B. Page  
 
       
 
Title:
Chief Financial Officer  
 
 
ACCEPTED AND AGREED, SOLELY
FOR PURPOSES OF SECTIONS 4, 6, 8, 10 AND 18:
 
CONTAINER APPLICATIONS LIMITED
 
   
By:
/s/ Timothy B. Page
 
     
Name:
Timothy B. Page
 
     
Title:
Chief Financial Officer
 
 
NPA Series 2012-1

 
 
 

Accepted and agreed to as of the date first above written:  
   
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED  
   
By:
/s/ Branden Avishar
 
 
Authorized Signatory
 

Accepted and agreed to as of the date first above written:  
     
WELLS FARGO SECURITIES, LLC  
     
By:
/s/ Jerri Kallam
 
 
Authorized Signatory
 
 
NPA Series 2012-1

 
 
 

EXHIBIT A
to Note Purchase Agreement (Series 2012-1)
 
LIST OF INVESTOR CASH FLOW REPORTS

Investor cash flow reports provided to AIG on October 4, 2012

Investor cash flow reports provided to New York Life on October 4, 2012

Investor cash flow reports provided to Wellington on October 9, 2012

Investor cash flow reports provided to Vanguard on October 10, 2012

 
 
 
 
SCHEDULE I
to Note Purchase Agreement (Series 2012-1)
 
Initial Purchaser
 
Principal Amount of the
Series 2012-1 Notes
 
Merrill Lynch, Pierce, Fenner & Smith Incorporated
  $ 85,500,000  
 
Wells Fargo Securities, LLC
  $ 85,500,000  
 
NPA Series 2012-1
 
 
 
 
 
SCHEDULE II
to Note Purchase Agreement (Series 2012-1)
 
Initial Purchaser Information: The information in the first, fourth and eighth paragraphs under the heading “PLAN OF DISTRIBUTION” in the Offering Memorandum.
 
NPA Series 2012-1
 
Exhibit 99.2
 
 
CONTRIBUTION AND SALE AGREEMENT
 
 
CONTAINER APPLICATIONS LIMITED
 
and
 
CAL FUNDING II LIMITED
 
 
Dated as of
 
October 18, 2012
ALL RIGHT, TITLE AND INTEREST OF CAL FUNDING II LIMITED IN AND TO THIS AGREEMENT HAVE BEEN ASSIGNED TO AND ARE SUBJECT TO A SECURITY INTEREST IN FAVOR OF WELLS FARGO BANK, NATIONAL ASSOCIATION, AS INDENTURE TRUSTEE, UNDER AN INDENTURE (DEFINED BELOW), FOR THE BENEFIT OF THE PERSONS REFERRED TO THEREIN.
 
 
 
 
 
TABLE OF CONTENTS
 
 
Page
   
ARTICLE I DEFINITIONS
1
   
Section 1.01. Definitions.
1
   
ARTICLE II TRANSFERS OF CONTAINERS
5
   
Section 2.01. Transfer of Initial Sold Assets.
5
Section 2.02. Transfer of Containers and Transferred Assets After the Initial Transfer Date
5
Section 2.03. Required Financing Statements; Marking of Records
6
Section 2.04. General Provisions Regarding All Transfers of Containers.
7
   
ARTICLE III REPRESENTATIONS AND WARRANTIES
8
   
Section 3.01. Representations and Warranties of the Seller
8
Section 3.02. Representations, Warranties and Covenants of the Company
15
Section 3.03. Breach of Representations and Warranties Regarding Sold Assets
18
Section 3.04. Substitute Containers
19
   
ARTICLE IV COVENANTS OF THE SELLER
20
   
Section 4.01. Seller Covenants
20
Section 4.02. Transfer of Sold Assets
24
   
ARTICLE V CONDITIONS PRECEDENT
24
   
Section 5.01. Conditions to the Company’s Obligations
24
Section 5.02. Conditions to the Seller’s Obligations
25
   
ARTICLE VI TERMINATION
25
   
Section 6.01. Termination
25
Section 6.02. Effect of Termination
25
   
ARTICLE VII INDEMNIFICATION PAYMENTS
25
   
Section 7.01. Indemnification
25
   
ARTICLE VIII MISCELLANEOUS PROVISIONS
26
   
Section 8.01. Amendment
26
Section 8.02. GOVERNING LAW
26
Section 8.03. CONSENT TO JURISDICTION
26
Section 8.04. Judgment Currency
27
Section 8.05. Notices
28
 
 
i
 
 
Section 8.06. Severability of Provision
28
Section 8.07. Assignment
28
Section 8.08. Further Assurances
28
Section 8.09. No Waiver; Cumulative Remedies
29
Section 8.10. Counterparts
29
Section 8.11. Binding Effect
29
Section 8.12. Merger and Integration
29
Section 8.13. Headings
29
Section 8.14. Schedules and Exhibits
29
Section 8.15. General Interpretive Principles
29
Section 8.16. WAIVER OF JURY TRIAL
30
Section 8.17. Waiver of Immunity
30
Section 8.18. Third Party Beneficiary
30
Section 8.19. Consent of the Control Party
30
   
EXHIBITS
 
A         -         List of Transferred Containers Transferred by the Seller
B         -         Container Sale Certificate
 
 
ii
 
 
CONTRIBUTION AND SALE AGREEMENT
 
THIS CONTRIBUTION AND SALE AGREEMENT, dated as of October 18, 2012 (as amended, modified or supplemented from time to time in accordance with its terms, this “Agreement”), is entered into between CONTAINER APPLICATIONS LIMITED, an international business company incorporated and licensed under the laws of Barbados (“CAL” or the “Seller”) with its principal place of business located at Suite 102, Bush Hill, Bay Street, St. Michael, Barbados, West Indies and CAL FUNDING II LIMITED, an exempted company with limited liability incorporated and existing under the laws of Bermuda (the “Company” or the “Issuer”) with its principal place of business located at Clarendon House, 2 Church Street, Hamilton HM 11 Bermuda.
 
WITNESSETH:
 
WHEREAS, from time to time hereafter, the Seller may sell, transfer, contribute and assign Sold Assets to the Company pursuant to the terms and conditions hereof;
 
WHEREAS, in connection with the transactions contemplated by the Indenture and other Related Documents, the Company has collaterally assigned to the Indenture Trustee, on behalf of the Noteholders and certain other Persons, all of its right, title and interest in and to the Sold Assets and this Agreement, as collateral for the Notes to be issued from time to time pursuant to the terms of the Indenture and any Supplements thereto; and
 
WHEREAS, the Seller and the Company agree that all representations, warranties, covenants and agreements made by the Seller and the Company herein shall be for the benefit of each Interest Rate Hedge Provider, each Noteholder and the Indenture Trustee, as assignees of the Company;
 
NOW, THEREFORE, in consideration of the mutual covenants contained herein, and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:
 
ARTICLE I
 
DEFINITIONS
 
Section 1.01.   Definitions .  Capitalized terms used in this Agreement but not defined herein shall have the meaning assigned to such terms in the Indenture (as defined herein); otherwise, terms defined herein shall have the following meanings and the definitions of such terms shall be equally applicable to the singular and plural forms of such terms:
 
After-Tax Basis :  With respect to any payment to be received, the amount of such payment increased so that, after deduction of the amount of all taxes withheld from, imposed upon or otherwise required to be paid by the recipient with respect to the receipt or accrual of such amounts, such increased payment (after such deductions) is equal to the payment otherwise required to be made reduced by any deductions, credits, or other tax savings determined by the recipient to be realized by it as a result of such payment, with the written claim for such amount being conclusive absent manifest error in the calculation thereof.
 
 
1
 
 
Aggregate Asset Value :  This term shall have the meaning set forth in the Indenture.
 
Aggregate CEU :  As of any date of determination, the sum of CEUs of all Eligible Containers then owned by the Company.
 
Applicable Law :  With respect to any Person or Sold Asset, all existing laws, rules, regulations (including temporary and final income tax regulations), statutes, treaties, codes, ordinances, permits, certificates, orders and licenses of and interpretations by any Governmental Authority and judgments, decrees, injunctions, writs, or orders of any court, arbitrator or other administrative, judicial, or quasi-judicial tribunal or agency of competent jurisdiction applicable to such Person or Sold Asset.
 
CEU :  This term shall have the meaning set forth in the Indenture.
 
Concentration Limits :  The limitations on the types of containers and leases and maximum exposure to lessees eligible for inclusion in the Asset Base as set forth in the definition of “Eligible Container”.
 
Container Identification Numbers :  The unique alpha numeric code assigned to a Container by the Seller.
 
Container Representations and Warranties :  With respect to each Transferred Container, the representations and warranties of the Seller as set forth in paragraphs (e) and (q) through (uu) inclusive of Section 3.01 of this Agreement.
 
Container Revenue :  All Gross Revenue allocated to the Managed Containers and allocable to the Managed Containers pursuant to the terms of the Management Agreement and the Intercreditor Collateral Agreement.
 
Container Sale Certificate :  A Container Sale Certificate, substantially in the form of Exhibit B hereto, executed and delivered by the Seller and the Company in accordance with the terms of this Agreement.
 
Eligible Container :  This term shall have the meaning set forth in the Indenture.
 
ERISA Affiliate :  With respect to any Person, any other Person which is treated as a single employer with such Person under § 414 of the Code.
 
Fair Market Value :  An amount equal to the value which would be obtained in an arm’s length sales transaction between an informed and willing purchaser under no compulsion to buy and an informed and willing seller under no compulsion to sell.
 
Finance Lease :  This term shall have the meaning set forth in the Indenture.
 
Finance Lease Balance :  This term shall have the meaning set forth in the Indenture.
 
 
2
 
 
Gross Revenue :  This term shall have the meaning set forth in the Management Agreement.
 
Indemnified Party :  This term shall have the meaning set forth in Section 7.01 hereof.
 
Indenture :  The Indenture, dated as of October 18, 2012, between the Issuer and the Indenture Trustee, as such indenture may be amended, modified or supplemented from time to time in accordance with its terms.
 
Initial Purchase Price :  This term shall have the meaning set forth in Section 2.01 hereof.
 
Initial Sold Assets :  Those Sold Assets transferred by the Seller to the Company on or before the Closing Date.
 
Lease File :  With respect to each Lease, the file containing all of the following:
 
(i)           An originally executed counterpart, or certified true, correct and complete copy of the lease supplement and/or lease schedule, executed by each of the lessor and the Lessee related to such Lease;
 
(ii)          A certified true, correct and complete copy of the executed original counterpart of the master lease agreement (if any) pursuant to which the lease supplement and/or lease schedule set forth in clause (i) was issued; and
 
(iii)        All originally executed, or certified true, correct and complete copies of all guarantees, letters of credit, UCC financing statements and all other addenda, supplements and amendments related to such Lease.
 
List of Containers :  A list (which list may be printed or electronic) of the Transferred Containers transferred by the Seller to the Issuer and certified by an Authorized Signatory of the Seller, which includes a true and complete list of all Transferred Containers to be conveyed by the Seller to the Issuer on any Transfer Date.  The List of Containers will include the following information for each such Transferred Container as of the Transfer Date: (i) the name of the Seller, (ii) its Container Identification Number, (iii) the type of Container and (iv) whether such Transferred Container is then subject to the terms of a Finance Lease.  Supplements to the List of Containers will be attached to the Container Sale Certificate and will contain only unit Container Identification Numbers for each Transferred Container.
 
Net Book Value :  This term shall have the meaning set forth in the Indenture.
 
Predecessor Container :  This term shall have the meaning set forth in Section 3.04 hereof.
 
Records :  All contracts and other documents, books, records and other information (including without limitation, computer programs, tapes, disks, punch cards, data processing software and related property and rights) maintained by the Seller to the extent relating to Sold Assets.
 
 
3
 
 
Senior Executive Officer :  Any of the chief executive officer, the president, chief financial officer, treasurer or controller of the Issuer, the Seller or Manager, as the case may be.
 
Sold Assets :  The Transferred Containers and Transferred Assets, collectively.
 
Substitute Container :  This term shall have the meaning set forth in Section 3.04 hereof.
 
Supporting Obligations :  This term shall have the meaning set forth in Section 9-102(a)(77) of the UCC.
 
Transfer Date .  Each date on which the Seller transfers to the Company a Transferred Container and any related Transferred Assets.
 
Transferred Assets :  With respect to any Transferred Container, all of the following:  (i) all right, title and interest of the Seller directly or indirectly in and to, but none of the obligations under, any agreement with the manufacturer of such Transferred Container to the extent (but only to the extent) related to the Transferred Container, and all amendments, additions and supplements thereafter made with respect to such Transferred Container, (ii) all right, title and interest of the Seller in and to any Lease to which such Transferred Container is subject on the Transfer Date, but only to the extent that such Lease relates to such Transferred Container, including all lease rentals accruing with respect thereto as of the related Transfer Date, (iii) all documents in the Lease File relating to such Transferred Container, but only to the extent relating to such Transferred Container, (iv) all Records to the extent relating to such Transferred Container, (v) all right, title and interest of the Seller in and to any other property identified in the related Container Sale Certificate, (vi) all Casualty Proceeds, Sales Proceeds, Miscellaneous Owner Proceeds, Indemnification Proceeds (each as defined in the Management Agreement) and Gross Revenues related to such Transferred Container, (vii) all other security interests or Liens and property subject thereto from time to time purporting to secure payment of the Leases (to the extent, but only to the extent, attributable to such Transferred Container), (viii) all letters of credit, guarantees, Supporting Obligations and other agreements or arrangements of whatever character from time to time supporting or securing payment of any Lease (to the extent, but only to the extent, attributable to such Transferred Container), and (ix) all other payments, proceeds (including, without limitation, insurance proceeds), income and distributions (in cash, securities or otherwise) of the foregoing or directly or indirectly related thereto.
 
Transferred Container :  An Eligible Container transferred by the Seller to the Company in accordance with the terms of this Agreement including either or both, as the context may require, Eligible Containers transferred on the Closing Date in accordance with the provisions of Section 2.01 hereof and Eligible Containers transferred subsequent to the Closing Date in accordance with the provisions of Section 2.02 hereof.
 
Warranty Purchase Amount :  With respect to any Transferred Container to be repurchased by the Seller pursuant to the terms of this Agreement, an amount equal to the excess of (x) the Net Book Value (or, if applicable, the Finance Lease Balance) of such Transferred Container on the related Transfer Date over (y) all rental and other payments received by the Indenture Trustee, on behalf of the Noteholders, with respect to such Transferred Container and the Transferred Assets since the related Transfer Date.
 
 
4
 
 
ARTICLE II
 
TRANSFERS OF CONTAINERS
 
Section 2.01.   Transfer of Initial Sold Assets .  On the initial Funding Date, the Seller shall sell, assign, convey, grant and transfer to the Issuer, and the Issuer shall acquire from the Seller, all of the Seller’s rights, title and interest in, to and under the Sold Assets set forth on Exhibit A hereto.  The purchase price for such Sold Assets shall be paid (x) first, by delivery of immediately available funds to CAL in an amount to be determined by the Issuer and the Seller prior to the initial Funding Date (the “ Cash Purchase Pric e”) and (y) second, by the Company’s acceptance of a capital contribution from CAL by way of contributed surplus, in an amount equal to the excess of the Fair Market Value of the applicable Sold Assets over the related Cash Purchase Price.  In connection with the conveyance set forth in this Section 2.01 with respect to the applicable Sold Assets to be sold, assigned, conveyed and transferred pursuant to the immediately preceding sentence, the Seller shall execute and deliver on the such Funding Date (except that evidence of filing in Section 2.02(b)(ii) below shall be delivered by the Seller promptly upon receipt thereof by the Seller), as applicable, each of the documents set forth in Section 2.02 hereof.
 
THE SOLD ASSETS ARE CONVEYED ON AN “AS IS-WHERE IS” BASIS, WITHOUT ANY REPRESENTATION OR WARRANTY WHATSOEVER, EXCEPT AS SET FORTH IN ARTICLE III.
 
Section 2.02.   Transfer of Containers and Transferred Assets After the Initial Transfer Date .  i)  After the initial Funding Date, the Seller hereafter may, from time to time, transfer to the Company by way of contributed surplus additional Sold Assets in the form of additional capital contributions and sales.
 
(b)           In connection with any transfer of Sold Assets by the Seller to the Company in accordance with the provisions of Section 2.01 or 2.02 of this Agreement, the Seller shall execute and deliver to the Company, the Administrative Agent and the Indenture Trustee on or before the related Transfer Date (except that evidence of filing in clause (ii) below shall be delivered by the Seller promptly upon receipt thereof by the Seller), each of the following:
 
(i)           A completed Container Sale Certificate which certificate shall operate as an assignment, without recourse, representation, or warranty, except for the other representations and warranties specifically set forth in this Agreement, of all of the Seller’s right, title, and interest in and to the applicable Sold Assets identified in such certificate.  Upon delivery of a completed Container Sale Certificate, the List of Containers shall be deemed to have been amended to incorporate the information contained in such Container Sale Certificate;
 
 
5
 
 
(ii)         Completed UCC financing statements or documents of similar import required under Section 2.03(a) hereof, together with evidence of filing of such financing statements in the appropriate filing offices and jurisdictions as may be required with respect to the Containers and Transferred Assets so transferred;
 
(iii)        Copies of all applicable UCC and federal, state and local Lien searches indicating the absence of any other Lien with respect to the Sold Assets identified in the related Container Sale Certificate; and
 
(iv)        With respect to any Sold Assets transferred by the Seller that were subject to the Lien prior to such transfer, the Seller shall have provided a release letter from the lenders (or the agent on behalf of the lenders) under such credit agreement or such security agreement, as applicable, in form and substance reasonably satisfactory to the Administrative Agent.
 
Section 2.03.   Required Financing Statements; Marking of Records .  ii)  In connection with the transfer by it on any Transfer Date, the Seller agrees, by not later than the Business Day after the Transfer Date, to record and file, at its own expense, the following UCC financing statements (and/or amendments to previously filed UCC financing statements), such filings to be made (unless otherwise requested by any Deal Agent) in each case only to the extent necessary pursuant to Applicable Law to protect the ownership interest of the Issuer and/or the security interest of the Indenture Trustee therein:
 
(i)           UCC financing statements (or amendments to existing UCC financing statements), naming the Seller, as debtor/seller, the Issuer, as secured party/buyer/assignor, the Indenture Trustee, as assignee of the secured party, and the applicable Sold Assets, as collateral.  Such financing statements (or documents of similar import) shall be filed in the appropriate filing offices in the jurisdiction in which the Seller is located (as defined in the UCC) or as otherwise required under Applicable Law;
 
(ii)         UCC financing statements (or amendments to existing UCC financing statements), naming the Issuer, as debtor, the Indenture Trustee, as secured party, and the Sold Assets, as collateral.  Such UCC financing statements shall be filed in the appropriate filing offices in the jurisdiction in which the Issuer is located (as defined in the UCC) or as otherwise required under Applicable Law;
 
(iii)        UCC financing statements (or amendments to or terminations or releases of existing UCC financing statements) or documents of similar import, evidencing the release of the security interest of any other Person with respect to any of the Sold Assets; and
 
(iv)        UCC financing statements, naming each Lessee of Transferred Containers subject to Finance Leases, as debtor, the Seller, as secured party, the Indenture Trustee, as assignee of the secured party, and the related Sold Assets under such related Finance Lease as collateral.  Such UCC financing statements shall be filed in the debtor Lessee’s jurisdiction of organization, if such Lessee is organized under the laws of one of the United States, and otherwise in the District of Columbia with the Recorder of Deeds.
 
 
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All UCC financing statements required pursuant to this Section 2.03 shall meet the requirements of Applicable Law.
 
(b)           In connection with each transfer of Sold Assets, the Seller shall, at its own expense on or prior to each Transfer Date, cause its master accounting and data processing records to be marked to indicate that all right, title and interest in each applicable Sold Asset has been irrevocably and absolutely transferred to the Company.
 
Section 2.04.   General Provisions Regarding All Transfers of Containers .  iii) Except as specifically provided in Section 3.03 and 7.01 of this Agreement, all transfers of Sold Assets pursuant to this Agreement shall be without recourse to the Seller; it being understood that the Seller shall be liable to the Company and to each Indemnified Party for all representations, warranties, covenants and indemnities made by the Seller pursuant to the terms of Sections 3.01, 3.04, 4.01 and 7.01 of this Agreement, all of which obligations are limited solely and exclusively so as not to constitute credit recourse to the Seller for losses arising from the financial inability of any Lessee to make its rental payments owed under the related Leases and/or the failure of the Company to realize a particular amount.
 
(b)           The Seller and the Company intend that all transfers of applicable Sold Assets to be a “true sale” by the Seller to the Company that is absolute and irrevocable and that provides the Company with the full benefits of ownership of related Sold Assets, and neither the Seller nor the Company intends the transactions contemplated hereunder to be, or for any purpose to be characterized as, loans from the Company to the Seller.  It is, further, not the intention of the Company nor the Seller that the conveyance of applicable Sold Assets by the Seller be deemed a grant of a security interest in the Sold Assets by the Seller to the Company to secure a debt or other obligation of the Seller.  However, in the event that, notwithstanding the intent of the parties, any Sold Assets are considered to be property of the Seller’s estate, then (i) this Agreement also shall be deemed to be and hereby is a “security agreement” within the meaning of Articles 8 and 9 of the UCC and under any other Applicable Law, and (ii) the conveyance by the Seller provided for in this Agreement shall be deemed to be a grant by the Seller to the Company of, and the Seller hereby grants to the Company, a security interest in and to all of the Seller’s right, title and interest in, to and under the Sold Assets including, without limitation, all Inventory, Equipment, Chattel Paper, General Intangibles, Accounts, Goods, Documents, Supporting Obligations, Instruments and proceeds of the foregoing constituting part of the applicable Sold Assets, whether now or hereafter existing or created, to secure (1) the rights of the Company hereunder, (2) a loan by the Company to the Seller in an amount equal to the sum of (i) the sum of the Aggregate Asset Value as of such date and (ii) the sum of the Fair Market Values of all applicable Transferred Assets, in each case to the extent of the Eligible Containers transferred by the Seller to the Company hereunder and (3) without limiting the foregoing, the payment and performance of the Seller’s obligations (whether monetary or otherwise) hereunder, including its obligation to remit to the Company or its designee all Gross Revenue allocable to the applicable Sold Assets as provided in the Intercreditor Collateral Agreement and the Management Agreement.  The Seller and the Company shall, to the extent consistent with this Agreement, take such actions as may be necessary to ensure that, if this Agreement were deemed to create a security interest in the related Sold Assets, such security interest would be deemed to be a perfected security interest of first priority in favor of the Company under Applicable Law and will be maintained as such throughout the term of this Agreement.
 
 
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(c)           Consistent with the Company’s ownership of the Sold Assets, as between the parties to this Agreement, the Company shall have the sole right to service, administer and collect the Sold Assets and to assign and/or delegate such right to others.
 
(d)           Except as specifically provided for in Section 3.03 hereof, the Company shall have no obligation to account to the Seller for the Sold Assets.  The Company shall have no obligation to account for, or to return rental payments on or with respect to a Sold Asset, or any interest or other finance charge collected pursuant thereto, to the related Seller, irrespective of whether such collections and charges are in excess of the Net Book Value (or, if applicable, the Finance Lease Balance) of such Sold Asset.  The Company shall have the sole right to retain any gains or profits created by buying, selling or holding the Sold Assets and shall have the sole risk of and responsibility for losses or damages created by such buying, selling or holding.
 
(e)           The Company shall have the unrestricted right to further assign, transfer, deliver, hypothecate, subdivide or otherwise deal with the Sold Assets in accordance with the terms of the Related Documents, and all of the Company’s right, title and interest in, to and under this Agreement, on whatever terms the Company shall determine, pursuant to this Agreement or otherwise.
 
ARTICLE III
 
REPRESENTATIONS AND WARRANTIES
 
Section 3.01.   Representations and Warranties of the Seller .  The Seller hereby makes the following representations and warranties for the benefit of the Issuer, the Indenture Trustee, the Noteholders, each Interest Rate Hedge Provider and the Company, and on which the Company relies in accepting the conveyance of the applicable Sold Assets (and on which the Company relies in accepting any further transfer of such Sold Assets) and the other parties to the transactions contemplated hereby have relied upon such representations and warranties in executing each of the Related Documents to which it is a party.  Such representations and warranties are made as of each Transfer Date (unless otherwise indicated) with respect to the related Sold Assets transferred by the Seller to the Company on such date, but shall survive until the Outstanding Obligations have been paid in full.
 
(a)            Organization and Good Standing .  The Seller is an international business company duly incorporated and licensed, validly existing and in compliance under the laws of the Barbados, with power and authority to own its properties and to conduct its business as such properties are currently owned and such business is currently conducted, had at all relevant times, and now has, power, authority, and legal right to acquire and own the related Sold Assets and to perform its obligations hereunder and under any Related Document to which it is a party, and, except as set forth in Schedule 3.01, the Seller has had the same legal name for the past five years and, except as set forth in Schedule 3.01, the Seller does not do business under any other name;
 
 
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(b)            Due Qualification .  The Seller is qualified to transact business in each jurisdiction and has obtained all necessary licenses and approvals as required under Applicable Law, in each case, where the failure to be so qualified, licensed or approved, could reasonably be expected to materially and adversely affect the ability of the Seller to perform its obligations under and comply with the terms of this Agreement and any other Related Document to which it is a party;
 
(c)            Power and Authority .  The Seller has the power and authority to execute and deliver this Agreement and any other Related Document to which it is a party and to carry out their terms; the Seller has duly authorized the sale and/or contribution to the Company of the related Sold Assets by all necessary action; the execution, delivery, and performance of this Agreement and any other Related Document to which it is a party has been duly authorized by the Seller by all necessary action and this Agreement and any other Related Document to which it is a party have been duly executed and delivered by the Seller;
 
(d)            Valid Assignment; Enforceable Obligations .  This Agreement constitutes a valid and absolute transfer of all right, title, and interest of the Seller in, to and under the related Sold Assets and such Sold Assets will be held by the Company free and clear of any Lien (regardless of whether such Lien is senior, pari passu or subordinate) of any Person claiming through or under either the Seller or the Company, except for Permitted Encumbrances; and this Agreement and each other Related Document to which it is a party, when duly executed and delivered by the other parties thereto, will constitute a legal, valid, and binding obligation of the Seller enforceable against the Seller in accordance with its terms subject as to enforceability to applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent conveyance or other laws affecting creditors’ rights generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law);
 
(e)            No Violation of Agreements .  The consummation of the transactions contemplated by and the fulfillment of the terms of this Agreement and the Related Documents to which it is a party will not conflict with any of the terms and provisions of, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time or both) a default under, the operating agreement or other constituent document of the Seller, or any material term of any indenture, agreement, mortgage, deed of trust, or other instrument to which the Seller is a party or by which it is bound, or result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture, agreement, mortgage, deed of trust, or other instrument, other than this Agreement and the Indenture, or violate any law or any order, rule, or regulation applicable to the Seller of any court or of any federal or state regulatory body, administrative agency, or other Governmental Authority having jurisdiction over the Seller or any of its properties;
 
 
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(f)             No Proceedings or Injunctions .  There are (i) no litigations, proceedings or investigations pending, or, to the knowledge of the Seller, threatened, before any court, regulatory body, administrative agency, or other tribunal or Governmental Authority (A) asserting the invalidity of this Agreement or any other Related Document to which it is a party, (B) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or any other Related Document to which it is a party, or (C) seeking any determination or ruling that might materially and adversely affect the performance by the Seller of its obligations under, or the validity or enforceability of, this Agreement or any other Related Document to which it is a party and (ii) no injunctions, writs, restraining orders or other orders in effect against the Seller that would adversely affect its ability to perform under this Agreement or any other Related Document to which it is a party;
 
(g)            Compliance with Law .
 
(i)          The Seller is not in violation of (A) any laws, ordinances, governmental rules or regulations, or (B) court orders to which it is subject or by which it is bound;
 
(ii)         The Seller has obtained any licenses, permits, franchises or other governmental authorizations necessary to the ownership of its property or to the conduct of its business including, without limitation, with respect to transactions contemplated by this Agreement and the other Related Documents to which it is a party; and
 
(iii)        The Seller is not in violation in any respect of any term of any agreement, or other instrument to which it is a party or by which it may be bound,
 
which violation or failure to obtain (as referenced in clause (i), (ii) or (iii) above) could reasonably be expected to, individually or in the aggregate, materially and adversely affect: (A) the business or financial condition of the Seller individually, or the Seller and its subsidiaries (if any) taken as a whole, (B) the ability of the Seller to perform any of its obligations hereunder or under any other Related Document, (C) any related Lease or the enforceability thereof, (D) the enforceability of this Agreement or any other Related Document, or (E) the interest of the Indenture Trustee or any Noteholder or Interest Rate Hedge Provider in any related Sold Asset;
 
(h)            Insolvency; Fraudulent Conveyance .  The Seller is paying its debts as they become due and is not “insolvent” within the meaning of any applicable Insolvency Law. The Seller represents that:
 
(x)          both immediately before and after giving effect to the assignment, transfer and contribution of the related Sold Assets and the application of the Cash Purchase Price, the present value of the Seller’s assets will be in excess of the amount that will be required to pay the Seller’s probable liabilities as they then exist and as they become absolute and matured; and
 
(y)         both immediately before and after giving effect to the assignment, transfer and contribution of the related Sold Assets and the application of the Cash Purchase Price, the sum of the Seller’s assets will be greater than the sum of the Seller’s debts, valuing the Seller’s assets at a Fair Market Value.
 
Each transfer of Sold Assets has been made for “reasonably equivalent value” (as such term is used in Section 548 of the Bankruptcy Code) and not on account of “antecedent debt” (as such term is used in Section 547 of the Bankruptcy Code);
 
 
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Each transfer of Sold Assets pursuant to the terms of this Agreement are not being taken with contemplation of insolvency and with no intent to hinder, delay or defraud any present or future credit of the Seller.
 
(i)              Chief Executive Office .  The principal place of business and chief executive office of CAL is at Suite 102, Bush Hill, Bay Street, St. Michael, Barbados, West Indies;
 
(j)              Accounting and Tax Treatment .  The Seller will treat the transfer of the related Sold Assets to the Company pursuant to this Agreement as a capital contribution of such Sold Assets for financial reporting, accounting and all income tax purposes, it being understood that such transfers may not be recognized in CAL’s consolidated financial statement under GAAP and may not be recognized for federal or state income tax purposes due to the Company’s status as a single member limited liability company, and the Seller has been advised by its Independent Accountants that such Independent Accountants agree with such treatment;
 
(k)            Approvals .  All approvals, authorizations, consents, orders or other actions of any Person required to be obtained by the Seller or, to the knowledge of the Seller, by any other party in connection with the execution and delivery of this Agreement or any other Related Document to which it is a party have been or will be taken or obtained on or prior to the Closing Date;
 
(l)              Governmental Consent .  No consent, approval or authorization of, or filing, registration or qualification with, any Governmental Authority is or will be necessary or required on the part of the Seller in connection with the execution and delivery of this Agreement or the transfer and conveyance of the related Sold Assets hereunder;
 
(m)            Investment Company Act .  Neither the Seller nor any of its Subsidiaries is an “investment company” or a company controlled by an “investment company” within the meaning of the Investment Company Act of 1940, as amended;
 
(n)            Ordinary Course .  The transactions contemplated by this Agreement and the other Related Documents are being consummated by the Seller in furtherance of the Seller’s ordinary business purposes and constitute a practical and reasonable course of action by the Seller designed to improve the financial position of the Seller, with no contemplation of insolvency and with no intent to hinder, delay or defraud any of its present or future creditors;
 
(o)            Bulk Transfer Act .  No transfer, assignment or conveyance of the related Sold Assets by the Seller to the Company contemplated by this Agreement will be subject to the bulk transfer or any similar statutory provisions in effect in any applicable jurisdiction;
 
(p)            Defaults .  The Seller is not in default with respect to (i) any Indebtedness or (ii) any other contractual obligation that could reasonably be expected to, individually or in the aggregate, materially and adversely affect: (A) the business or financial condition of the Seller individually, or the Seller and its subsidiaries (if any) taken as a whole, (B) the ability of the Seller to perform any of its obligations hereunder or under any other Related Document, (C) the ability of the Company to enforce any assignment, transfer, conveyance or contribution hereunder, (D) any related Lease or the enforceability thereof, (E) the enforceability of this Agreement or any other Related Document, or (F) the interest of the Indenture Trustee or any Noteholder or any Interest Rate Hedge Provider in any related Sold Asset;
 
 
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(q)            Title to Sold Assets; All Action Taken .  Upon the transfer of any Sold Assets to the Company pursuant to the terms of this Agreement, the Company will have had good and marketable title to such Sold Assets free and clear of any Liens other than (i) Permitted Encumbrances and (ii) with respect to Containers subject to a Lease, Encumbrances that the Lessee is required to remove pursuant to the terms of such Lease.  Immediately after each of the transfers and conveyances to the Company as contemplated in this Agreement, all necessary action will have been taken by the Seller and the Company to validly transfer and convey to the Company all right, title and interest of the Seller in and to the related Transferred Containers and the related Transferred Assets arising on or after the related Transfer Date;
 
(r)             Specifications .  The related Transferred Containers shall conform to (i) the Seller’s standard specifications for that category of container and to any applicable industry standards or (ii) if such Transferred Container is subject to a Finance Lease on the Transfer Date, to the standard specifications of either Seller or the Lessee;
 
(s)             Casualty Loss .  To the knowledge of the Seller, no related Transferred Container shall have suffered a Casualty Loss on or prior to the related Transfer Date;
 
(t)             No Violation of Leases .  The transfer and conveyance to the Company of the Sold Assets will not violate the terms or provisions of any Lease or any other agreement to which the Seller then is a party or by which it is bound;
 
(u)            Rights to Leases .  The rights with respect to each Lease transferred and all scheduled payments thereunder pursuant to this Agreement are assignable by the Seller without the consent of any Person other than consents which will have been obtained on or before the related Transfer Date;
 
(v)            Lessee Acceptance .  Each Lessee has received and taken possession of each Transferred Container leased to it in satisfactory condition and in proper working order and had a reasonable opportunity to inspect the Transferred Container leased to it and has not notified the Seller of any material defects therein;
 
(w)            Lease Files .  Each Lease File shall be handled and stored as provided in the Intercreditor Collateral Agreement;
 
(x)             Insurance .  Except for self-insurance that is permitted pursuant to the Manager’s credit policy, each Lease requires the Lessee thereunder to maintain physical damage insurance on each Transferred Container that complies with the terms of the Management Agreement.  Upon the occurrence of a casualty with respect to a Transferred Container, each Lease requires the related Lessee to pay an amount which equals or exceeds the Net Book Value (or, if applicable the Finance Lease Balance) for such Transferred Container, as of the Payment Date immediately preceding the making of such payment;
 
 
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(y)            Master Lease Arrangements .  In the case of each Lease which consists of a master lease and one or more exhibits or schedules thereto, each such exhibit or schedule (as it incorporates the terms of the master lease) constitutes a separate contractual lease obligation of the related Lessee, and permits full and partial assignments of the lessor’s rights thereunder to one or more secured parties;
 
(z)             Possession of Leases .  The original counterpart of each Lease in the possession of the Manager or any of its Affiliates shall be maintained by the Manager or the Collateral Agent as contemplated by the Intercreditor Collateral Agreement.
 
(aa)           No Leases Intended as Security .  No Lease, other than any Finance Lease, is a “lease intended as security” as defined in Section 1-201(37) of the applicable UCC.  The terms and conditions of each Lease, other than any Finance Lease, are of such a nature that the Transferred Container subject to such Lease would not be considered property of the Lessee or its estate in the event of the insolvency of the Lessee under any Federal or state applicable Insolvency Laws;
 
(bb)          Eligible Container .  Each Transferred Container is an Eligible Container;
 
(cc)           Container Lessees .  Each Transferred Container that is then on lease to a Lessee is leased in accordance with the Manager’s then existing credit underwriting policy;
 
(dd)          Registration .  Each Transferred Container has been registered, by virtue of its Container Identification Number which is included in a range of Container Identification Numbers registered in the name of CAL in the official register of the Bureau International des Containers (Paris), either:  (i) in the name of CAL; or (ii) with respect to Transferred Containers that were originally acquired by CAL after they had originally been placed in service, in the name of the original owner of such Container;
 
(ee)           Invoice Price .  The price paid by the Seller to originally acquire such Transferred Container was not greater than the Fair Market Value of such Transferred Container at the time of acquisition by the Seller;
 
(ff)            U.S. Dollars .  All payments under each Lease are payable in U.S. Dollars;
 
(gg)          Ordinary Course of Business .  All Leases related to Containers were originated or acquired in the ordinary course of the Seller’s business.
 
(hh)          No Lease Default .  With respect to each Transferred Container that is “on lease” as of the related Transfer Date: (i) with respect to payments of rent or under sums due under the Lease, Seller has not declared an Event of Default for failure of the related Lessee to make such payments and no rental or other payment owing pursuant to such Lease is more than sixty  days delinquent as of such Transfer Date; and (ii) with respect to all other obligations of the Lessee under such Lease, to the best of Seller's knowledge, no Event of Default thereunder has occurred and is continuing under such Lease or any other Lease between the Seller and such Lessee;
 
(ii)             Net Book Value or Finance Lease Value .  The Net Book Value or Finance Lease Value, as the case may be, is accurately set forth on the related Container Sale Certificate;
 
 
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(jj)             Eligible Container .  Any Container to be included in the Sold Assets meets the definition of “Eligible Container” (as set forth in the Indenture) on its Transfer Date;
 
(kk)           Creation of Security Interest .  In the event that the transfer of the Sold Assets pursuant to the terms of this Agreement is held not to constitute a “true sale”, this Agreement creates a valid and continuing security interest (as defined in the UCC) in the Sold Assets in favor of the Company, which security interest is prior to all other Liens other than Permitted Encumbrances, and is enforceable as such as against creditors of and purchasers from the Seller;
 
(ll)             UCC Classification .  The Transferred Containers constitute “goods” or “inventory” within the meaning of the applicable UCC. The Leases constitute “tangible chattel paper” within the meaning of the UCC.  The lease receivables constitute “accounts” or “proceeds” of the Leases with the meaning of the UCC;
 
(mm)         Seller Title to Sold Assets .  Immediately prior to the conveyance of the Sold Assets set forth in this Agreement, the Seller owned and had good and marketable title to such Sold Assets, free and clear of any Lien (whether senior, junior or pari passu), claim or encumbrance of any Person, except for Permitted Encumbrances;
 
(nn)          Perfection of Security Interest .  The Seller has caused the filing of all appropriate financing statements or documents of similar import in the proper filing office in the appropriate jurisdictions under Applicable Law in order to perfect the security interest in the related Sold Assets granted to the Company in this Agreement.  All financing statements filed or to be filed against the Seller in favor of the Company (and the Indenture Trustee, as its assignee) in connection herewith contain a statement to the following effect:  “A purchase of or security interest in any collateral described in this financing statement will violate the rights of the Company and the Indenture Trustee (as the assignee of the Company)”;
 
(oo)          No Existing Liens .  The Seller has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed or released any of the related Sold Assets, except for any pledge or security interest that is released concurrently with the sale to the Company. The Seller has not authorized the filing of, and is not aware of, any financing statements against the Seller that include a description of collateral covering the related Sold Assets other than any financing statement or document of similar import (i) relating to the security interest granted to the Company in this Agreement or the security interest granted to the Indenture Trustee in the Indenture or any Related Document or (ii) that has been terminated or released (or will be amended to exclude the related Sold Assets within five (5) Business Days of the related Transfer Date).  The Seller is not aware of any judgment or tax lien filings against the Seller;
 
(pp)          All Consents Secured .  The Seller has received all necessary consents and approvals required by the terms of the related Sold Assets to the transfer to the Company of its interest and rights in such Sold Assets hereunder;
 
(qq)          Purchase Price .  The consideration paid by the Company for each Transferred Container is not greater than the Net Book Value (or, if applicable, the Finance Lease Balance) of such Transferred Containers at the time of sale to the Company;
 
 
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(rr)           Lease Terms .  As of the Transfer Date, the Lease related to the Transferred Containers were entered into or acquired in the ordinary course of business of the Seller and contain commercially reasonable terms, consistent with the general trading terms that the Seller uses in the normal course of business;
 
(ss)           Net Lease .  Generally, the Lessee’s obligations under each Lease are “hell or high water” obligations that are, among other characteristics, absolute and not subject to any defenses, set-offs, or counterclaims; each Lease has no rescission, reduction, or recoupment provision except as to disputed amounts (in certain limited circumstances) and provides that, upon the making of a casualty payment, the obligation of the related Lessee to make Lease Payments thereunder will be reduced accordingly; and each Lease is a “net lease” under which the Lessee is responsible for all taxes, maintenance, and insurance and assumes all risk of casualty loss;
 
(tt)            Purchase Option .  No Lease provides a purchase option for any Transferred Container (subject to such Lease) to any Lessee which would result, when taken together with all rental payments previously made or required to be made under such Lease or any prior Lease with respect to such Transferred Container, in less than the Original Equipment Cost being realized on the disposition of the related Transferred Container;
 
(uu)          Bankrupt Lessees under Finance Leases .  No Transferred Container subject to a Finance Lease is under lease to a bankrupt obligor as of the related Transfer Date; and
 
(vv)          All Representations and Warranties True .  All representations and warranties made by the Seller in any certificate or other document delivered at the closing of the transactions contemplated by the Related Documents including all representations and warranties made to Perkins Coie LLP in support of its opinion letter issued and delivered in connection with the issuance of the Notes and each of the factual assumptions contained in such opinions to the extent compliance with such assumptions is in the control of the Seller, are true and correct in all material respects.
 
Section 3.02.   Representations, Warranties and Covenants of the Company .  The Company hereby makes the following representations and warranties for the benefit of the Seller, the Indenture Trustee, the Noteholders, each Interest Rate Hedge Provider and the Administrative Agent on which the Seller relies in contributing the related Sold Assets to the Company.  The Seller has relied upon such representations and warranties in transferring the related Sold Assets to the Issuer and the other parties to the transactions contemplated hereby have relied upon such representations and warranties in executing each of the Related Documents.  Such representations and warranties are made as of each Transfer Date with respect to the Sold Assets contributed to the Company on such date and the date of each subsequent transfer and conveyance of the respective Sold Assets and the pledge of such Sold Assets to the Indenture Trustee, unless otherwise indicated, but shall survive until all Outstanding Obligations have been paid in full.
 
 
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(a)            Organization and Good Standing .  The Company is  an exempted company with limited liability duly incorporated, validly existing and in compliance under the laws of the Bermuda, with power and authority to own its properties and to conduct its business as such properties are currently owned and such business is currently conducted, had at all relevant times, and now has, power, authority, and legal right to acquire and own the Sold Assets and to perform its obligations hereunder and under any Related Document to which it is a party, and has had the same legal name since its formation and does not do business under any other name;
 
(b)            Due Qualification .  The Company is duly qualified to do business, and has obtained all necessary licenses and approvals, in all jurisdictions in which the ownership or lease of property or the conduct of its business requires such qualification, except to the extent that the failure to be so qualified, licensed or approved would not, in the aggregate, materially and adversely affect the ability of the Company to perform its obligations under and comply with the terms of this Agreement or any other Related Documents to which it is a party;
 
(c)            Power and Authority .  The Company has the power and authority to execute and deliver this Agreement and to carry out its terms; and the execution, delivery, and performance of this Agreement have been duly authorized by the Company by all necessary action; the Company will have the power and authority to acquire and will have acquired whatever right title and interest in the Sold Assets as was conveyed to it by the Seller; and will have duly authorized, executed and delivered the Notes, this Agreement and the other Related Documents to which it is a party;
 
(d)            Binding Obligations .  This Agreement and each other Related Document to which the Company is a party, when duly executed and delivered by the other parties hereto or thereto, will constitute a legal, valid, and binding obligation of the Company enforceable in accordance with its terms subject as to enforceability to applicable bankruptcy, reorganization, insolvency, moratorium or other laws affecting creditors’ rights generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law);
 
(e)             No Violation .  The consummation of the transactions contemplated by and the fulfillment of the terms of this Agreement (after giving effect to the transactions set forth herein) will not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time) a default under, the limited liability agreement of the Company, or any term of any indenture, agreement, mortgage, deed of trust or other instrument to which the Company is a party or by which its assets may be bound;
 
(f)             No Proceedings or Injunctions .  There are (i) no proceedings or investigations to which the Company, or any Affiliate of the Company is a party pending, or, to the knowledge of the Company, threatened, before any court, regulatory body, administrative agency or other tribunal or Governmental Authority (A) asserting the invalidity of the Notes, this Agreement or the other Related Documents to which the Company is a party, (B) seeking to prevent the issuance of the Notes or the consummation of any of the transactions contemplated by this Agreement or the other Related Documents to which the Company is a party, or (C) seeking any determination or ruling that would materially and adversely affect the performance by the Company of its obligations under, or the validity or enforceability of, the Notes, this Agreement or the other Related Documents to which the Company is a party and (ii) no injunctions, writs, restraining orders, or other orders in effect against the Company that would adversely affect its ability to perform under the Notes, this Agreement or the other Related Documents to which it is a party;
 
 
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(g)            Approvals .  All approvals, authorizations, consents, orders or other actions of any Person required to be obtained by the Company or, to the knowledge (without inquiry) of the Company, by any other party in connection with the execution and delivery of this Agreement or any other Related Document to which it is a party have been or will be taken or obtained on or prior to the Closing Date;
 
(h)            Insolvency .  The Company is not insolvent under the Insolvency Law and will not be rendered insolvent by the transactions contemplated by this Agreement; the Company is paying its debts as they become due and, after giving effect to the transactions contemplated by this Agreement, will have adequate capital to conduct its business; the Company does not intend to nor believe that it will incur debts beyond its ability to pay as such debts mature;
 
(i)             Principal Place of Business; Trade Names .  The Company has only one place of business which is located at Clarendon House, 2 Church Street, Hamilton HM 11 Bermuda.  The Company has not been known by any name other than CAL Funding II Limited;
 
(j)              No Subsidiaries .  The Company has no Subsidiaries;
 
(k)             Ordinary Course .  The transactions contemplated by this Agreement are being consummated by the Company in good faith and in furtherance of the Company’s ordinary business purposes and constitute a practical and reasonable course of action by the Company designed to improve the financial position of the Company, with no contemplation of insolvency and with no intent to hinder, delay or defraud any of its present or future creditors;
 
(l)             Substantive Consolidation .  The Company shall be operated in such a manner that it shall not be substantively consolidated with the estate of the Seller or any other person in the event of the bankruptcy or insolvency of the Company or such other person.  Without limiting the foregoing the Company shall:  (1) conduct its business in its own name, (2) maintain its books and records separate from those of any other person, (3) maintain its bank accounts separate from those of any other Person, (4) maintain separate financial statements, showing its assets and liabilities separate and apart from those of any other Person, (5) pay its own liabilities and expenses only out of its own funds, (6) enter into a transaction with an Affiliate only if such transaction is intrinsically fair, commercially reasonable and on the same terms as would be available in an arm’s length transaction with a person or entity that is not an Affiliate, (7) allocate fairly and reasonably any overhead expenses that are shared with an Affiliate, (8) hold itself out as a separate entity, (9) maintain adequate capital in light of its contemplated business operations and (10) observe all other appropriate organizational formalities.
 
 
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Notwithstanding any provision of law which otherwise empowers the Company, the Company shall not:  (1) consolidate or merge with or into any other person or dissolve or liquidate in whole or in part or transfer its properties and assets substantially as an entirety to any other person, (2) hold itself out as being liable for the debts of any other person, (3) act other than in its corporate name and through its duly authorized officers or agents, (4) engage in any joint activity or transaction of any kind with or for the benefit of any Affiliate including any loan to or from or guarantee of the indebtedness of any Affiliate, except payment of lawful distributions to its shareholders, (5) commingle its funds or other assets with those of any other person other than as provided in the Management Agreement and the Intercreditor Collateral Agreement, (6) create, incur, assume, guarantee or in any manner become liable in respect of any indebtedness other than indebtedness permitted under the terms of the Indenture or any Related Documents or (7) take any other action that would be inconsistent with maintaining the separate legal identity of the Company or engage in any other activity.
 
(m)            All Representations and Warranties True .  All representations and warranties made by the Company in any certificate or document delivered at the closing of the transactions contemplated by the Related Documents including all representations and warranties made to Perkins Coie LLP in support of its opinion letters issued and delivered in connection with the issuance of the Notes and each of the factual assumptions contained in such opinions to the extent compliance with such assumptions is in the control of the Company, are true and correct in all material respects.
 
Section 3.03.   Breach of Representations and Warranties Regarding Sold Assets .  iv)  Upon discovery by the Seller, the Administrative Agent, the Indenture Trustee or the Company (or any of their respective successors or assigns) of a breach of any of the Container Representations and Warranties, the party (including any such successor or assign) discovering such breach shall give prompt written notice to the other parties and the Administrative Agent.  Unless the breach shall have been cured or waived in writing by the Requisite Global Majority, within thirty (30) days after the earlier of (x) actual knowledge of such breach by a Senior Executive Officer of the Seller or (y) receipt by the Seller of written notice of such breach, the Seller shall on or prior to such thirtieth (30th) day either:
 
(i)           repurchase the affected Transferred Container(s) and Transferred Assets from the Company for a cash purchase price equal to the Warranty Purchase Amount; or
 
(ii)          replace the affected Transferred Containers and Transferred Assets with Substitute Container(s) and Transferred Assets in accordance with the provisions of Section 3.04 hereof.
 
Without limiting the generality of the foregoing, the Seller acknowledges and agrees that, for purposes of this Section 3.03, any inaccuracy in any representation or warranty with respect to (i) the amount (if less than represented) of the Net Book Value or the Finance Lease Balance, as applicable, of any related Transferred Container, on the Transfer Date or (ii) the failure to comply with the Concentration Limits as of the Transfer Date, shall be deemed to be material.
 
(b)           With respect to all Containers purchased or replaced by the Seller pursuant to this Section 3.03, the Company hereby assigns to the Seller, without recourse, representation or warranty (except as to the absence of liens, claims, or encumbrances resulting from actions taken, or failed to be taken, by the Company), all of the Company’s right, title and interest in and to such Containers and other Transferred Assets relating thereto.
 
 
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(c)           The Company agrees that the obligation of the Seller to repurchase or, if available, substitute any container pursuant to this Section 3.03 shall constitute the sole remedies available against the Seller by the Company and its successors and assigns for breach of a Container Representation or Warranty; provided, however , that nothing contained herein shall derogate from the Seller’s indemnification obligations set forth in Section 7.01 hereof.
 
Section 3.04.   Substitute Containers .  v) The Seller will have the right (exercisable solely at its option) at any time to transfer to the Company one or more Containers and Transferred Assets (the foregoing collectively, a “Substitute Container”) for one or more Containers and Transferred Assets (the foregoing collectively, a “ Predecessor Container”) if:
 
(i)          the Predecessor Container is required to be repurchased pursuant to Section 3.03 hereof;
 
(ii)         the Substitute Container has a Net Book Value (or a Finance Lease Balance) of not less than the Net Book Value (or a Finance Lease Balance) of the Predecessor Container;
 
(iii)        the Substitute Container is an Eligible Container;
 
(iv)        no Early Amortization Event or Event of Default is then continuing or would result from the ownership of such Substitute Container by the Issuer; and
 
(v)         the Substitute Container shall be subject to a similar type of Lease as that of the Predecessor Container.
 
If more than one Substitute Container is being transferred on any date, the criteria set forth in clauses (ii) and (iii) above shall be determined on an aggregate basis for all Containers transferred on such date.
 
(b)           Any substitution pursuant to this Section 3.04 shall become effective upon (i) delivery to the Indenture Trustee, the Administrative Agent and the Company of a completed Container Sale Certificate which certificate shall operate as a transfer to the Company of all right, title and interest of the Seller in and to the Substitute Container subject thereto, (ii) delivery to the Seller by the Company of such Container Sale Certificate which shall operate as a transfer to the Seller, without representation or warranty except with respect to unencumbered title, all of the Company’s right, title and interest in and to the Predecessor Container, and (iii) delivery to the Company, the Indenture Trustee and the Administrative Agent of an amendment to the List of Containers reflecting the deletion of the Predecessor Container and the addition of the Substitute Container.
 
(c)           The Seller shall give at least (5) five Business Days’ prior written notice to the Company, the Administrative Agent and the Indenture Trustee of its intent to provide a Substitute Container pursuant to Section 3.04 hereof.
 
 
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ARTICLE IV
 
COVENANTS OF THE SELLER
 
Section 4.01.   Seller Covenants .  The Seller hereby covenants and agrees with the Company, the Issuer, each Interest Rate Hedge Provider, the Noteholders and the Indenture Trustee as follows:
 
(a)            Merger or Consolidation of, or Assumption of the Obligations of, the Seller .  Any corporation or other entity (i) into which the Seller may be merged or consolidated, (ii) resulting from any merger, conversion, or consolidation to which the Seller shall be party, or (iii) succeeding to the business of the Seller substantially as a whole, will be the successor to the Seller under this Agreement, without the execution or filing of any document or any further act on the part of any of the parties to this Agreement so long as, (x) immediately after giving effect to such transaction, no Event of Default, Manager Default or Early Amortization Event shall result therefrom (including an Asset Base Deficiency pursuant to a breach of Container Representations and Warranties) and no representation or warranty made pursuant to Section 3.01 shall have been breached, (y) the Seller shall have delivered to the Company, the Issuer, the Administrative Agent and each Rating Agency an Officer’s Certificate stating that such consolidation, merger, or succession and any agreement of assumption relating to such transaction comply with this Section 4.01 and that all conditions precedent, if any, provided for in this Agreement relating to such transaction have been complied with and (z) the Seller shall have delivered to the Company, the Issuer, the Administrative Agent and each Rating Agency an Opinion of Counsel reasonably satisfactory to the Requisite Global Majority either (1) stating that, in the opinion of such counsel, all financing statements, or other documents of similar import, and amendments thereto have been executed and filed that are necessary fully to preserve and protect the interest of the Company and the Indenture Trustee in the Sold Assets, or (2) stating that, in the opinion of such counsel, no such action shall be necessary to preserve and protect such interest.
 
(b)            Preservation of Security Interest in Finance Lease .  The Seller shall, at its own sole cost and expense with respect to any Lessee whose Containers are subject to a Finance Lease, file such instruments and documents and take such actions as shall be required to establish and maintain an effective lien against the Lessee’s interest in the Transferred Containers in the Lessee’s jurisdiction of organization and execute and file such financing statements and other documents, and take such other action as shall be reasonably requested by the Indenture Trustee to preserve, maintain, perfect, continue and protect the first priority perfected security interest of the Indenture Trustee in such Transferred Containers that are subject to such Lessee’s Finance Lease.
 
 
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(c)            Preservation of Name, etc .  The Seller will not change its name, identity, corporate structure or jurisdiction of organization in any manner that would, could, or might make any financing statement or continuation statement filed by the Seller in accordance with this Agreement void or otherwise of no force and effect unless (i) the Seller shall have given the Company, the Administrative Agent and the Indenture Trustee at least 60 days’ prior written notice thereof, (ii) the Seller shall have filed any necessary financing statements necessary to continue the effectiveness of any financing statements referred to in paragraph (b) above or otherwise required pursuant to this Agreement and (iii) the Seller shall have delivered to the Issuer, the Indenture Trustee, the Administrative Agent and each Rating Agency, one or more Opinions of Counsel satisfactory to the Indenture Trustee, stating that after giving effect to such change in name, identity, location of chief executive office, jurisdiction of incorporation or corporate structure, either (x) in the opinion of such counsel, all financing statements, or other documents of similar import, and amendments thereto have been executed and filed that are necessary fully to preserve and protect the interest of the Issuer and the Indenture Trustee in the Transferred Containers, or (y) stating that, in the opinion of such counsel, no such action shall be necessary to preserve and protect such interest.
 
(d)            Preservation of Office .  The Seller will give the Company, the Administrative Agent and the Indenture Trustee at least 30 days’ prior written notice of any relocation of its principal place of business and chief executive office or reincorporation in another jurisdiction.  No later than five days prior to the closing date of such change or relocation, the Seller shall file such amendments and/or financing statements as may be required to preserve and protect the Company’s and Indenture Trustee’s interest in the related Sold Assets.
 
(e)            Compliance with Law .  The Seller will comply, in all material respects, with all acts, rules, regulations, orders, decrees and directions of any Governmental Authority applicable to the related Sold Assets or any part thereof; provided , however , that the Seller may contest any act, regulation, order, decree or direction in any reasonable manner which shall not materially and adversely affect the rights of the Company, the Issuer, the Noteholders, any Deal Agent or the Indenture Trustee in the related Sold Assets.
 
(f)             Defend Title to Sold Assets .  The Seller shall defend the right, title, and interest of the Company and its successors and assigns in, to, and under the related Sold Assets, against all claims of third parties claiming through or under the Seller.
 
(g)            Notification of Breach .  The Seller will advise the Company, the Administrative Agent and the Indenture Trustee promptly, in reasonable detail, upon discovery of the occurrence of any breach by the Seller of any of its representations, warranties and/or covenants contained in any Related Document to which it is a party.
 
(h)            Further Assurances .  The Seller will, at its sole cost and expense, make, execute or endorse, acknowledge and file or deliver to the Company, the Indenture Trustee and the Administrative Agent from time to time such UCC financing statements or documents of similar import (including any termination or continuation statements), schedules, confirmatory assignments, conveyances, transfer endorsements, powers of attorney, certificates, reports and other assurances or instruments and take such further steps relating to the related Sold Assets and other rights covered by this Agreement, as the Company or its successors and assigns, including the Indenture Trustee or the Administrative Agent may request and reasonably require.  The Seller shall, at the request of the Administrative Agent, deliver to the Indenture Trustee and the Administrative Agent an updated List of Containers.  The Seller shall, at the request of the Indenture Trustee or the Administrative Agent, execute such documents and instruments as may be reasonably requested and as are prepared by the Indenture Trustee or the Administrative Agent to permit the Manager, in accordance with the terms of the Management Agreement to enforce the Leases and/or any insurance policies obtained by the Lessees with respect to the related Sold Assets.
 
 
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(i)             Notice of Liens .  The Seller shall notify the Company, the Administrative Agent and the Indenture Trustee promptly after becoming aware of any Lien other than Permitted Encumbrances on the related Sold Assets.
 
(j)             Transfer Taxes .  The Seller shall promptly pay all taxes (including, without limitation, any transfer taxes) required to be paid in connection with the conveyance of the related Sold Assets, and acknowledges that the Company shall have no responsibility with respect thereto.
 
(k)             No Bankruptcy Petition .  The Seller will not, prior to the date that is one year and one day after the payment in full of all amounts owing by the Company pursuant to the Indenture, this Agreement and the Related Documents, institute against the Company or join any other Person in instituting against the Company, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceedings under the laws of any applicable jurisdiction.  This subsection 4.01(k) shall survive the termination of this Agreement.
 
(l)             Ownership of Sold Assets .  The Seller agrees to take no action inconsistent with the ownership of the related Sold Assets by the Company, to promptly indicate to all parties with a valid interest inquiring as to the true ownership of such Sold Assets that such Sold Assets have been contributed to the Company and to claim no ownership interest in such Sold Assets.
 
(m)            Substantive Consolidation .  The Seller shall be operated in such a manner that it shall not be substantively consolidated with the estate of any Issuer in the event of the bankruptcy or insolvency of the Seller.  Without limiting the foregoing, the Seller shall:  (1) conduct its business in its own name, (2) maintain its books and records separate from those of any other Person, (3) maintain its bank accounts separate from those of any other Person, (4) maintain separate financial statements, showing its assets and liabilities separate and apart from those of any other Person, (5) pay its own liabilities and expenses only out of its own funds, (6) allocate fairly and reasonably any overhead expenses that are shared with the Issuer, (7) hold itself out as an entity separate from the Issuer, (8) maintain adequate capital in light of its contemplated business operations and (9) observe all other appropriate organizational formalities.
 
(n)            Communications .  The Seller will reply to all inquiries by third parties with respect to the ownership of the related Sold Assets by indicating that it has contributed, assigned and transferred all of such Sold Assets to the Company.
 
(o)            Obligations with Respect to Leases .  The Seller will duly fulfill all obligations on its part to be fulfilled under or in connection with each related Lease, will not attempt to change or modify the terms of such Leases except as expressly permitted by the terms of the Related Documents, and will do nothing to impair the rights of the Indenture Trustee or the Company or the Indenture Trustee in the related Sold Assets or the beneficial ownership thereof.
 
 
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(p)            Separate Corporate Existence of the Company .  The Seller hereby acknowledges that the Company is entering into the transactions contemplated by the Related Documents in reliance upon the Company’s identity as a legal entity separate from the Seller.  Therefore, the Seller will take all reasonable steps to continue its identity as a separate legal entity and to make it apparent to third Persons that it is an entity with assets and liabilities distinct from those of the Company and that the Company is not a division of the Seller or any other Person.
 
(q)            Marking of Records .  The Seller shall mark the master accounting and data processing records to evidence the transfer of the related Transferred Containers in the manner described in Section 2.03(b) hereof and such records shall be maintained at the Seller’s place of business.
 
(r)            Accounting for Transfers . CAL shall prepare its financial statements in accordance with GAAP, and any financial statements of CAL which are consolidated to include the Company will contain footnotes indicating that the Sold Assets to the Company are not available to satisfy the debts of the Seller.  CAL shall not prepare any such financial statements that account for the transactions contemplated in this Agreement in any manner other than as a transfer of the Sold Assets by the Seller to the Company, or in any other respect account for or treat the transactions contemplated in this Agreement (including but not limited to accounting) in any manner other than as a contribution of the Sold Assets by the Seller to the Company.
 
(s)            Provision of Information .  From time to time, and upon reasonable request, the Seller shall provide the Company, the Manager Transfer Facilitator, the Administrative Agent and the Indenture Trustee with all information required to evaluate the Container Representations and Warranties.
 
(t)             Inspection Right; Audit Inspections .  Upon reasonable notice to the Seller specifying the particulars of each request and subject to appropriate and reasonable confidentiality covenants, the Seller will permit the representatives of the Company, the Manager, the Administrative Agent and their duly authorized representatives, attorneys and accountants to audit and examine all of the books, records, reports and other papers of the Seller (other than the Seller’s tax returns and tax calculations, in each case relating to taxes for which the Company is not liable) with respect to any and all related Sold Assets, to make copies and extracts therefrom, and to discuss its affairs, finances and accounts with its officers, employees and Independent Accountants for the purpose of reviewing or evaluating the Seller’s performance of its duties and obligations hereunder.  All reasonable out-of-pocket expenses incidental to the exercise of the inspection right pursuant to this paragraph by any such Person, or by any of such Persons’ duly authorized representatives, attorneys and accountants, shall be borne by the Seller without right of reimbursement from any Person for such expenses.
 
(u)            Notes and Indebtedness .  The Seller shall treat the Notes as indebtedness on any tax return of the Seller and its Subsidiaries.
 
(v)            ERISA .  The Seller agrees to indemnify, defend and hold the Issuer harmless from and against any and all loss, liability, damage, judgment, claim, deficiency, or expense (including interest, penalties, reasonable attorneys’ fees and amounts paid in settlement) to which the Issuer may become subject insofar as such loss, liability, damage, judgment, claim, deficiency or expense arises out of any Plan maintained and/or contributed to by the Seller or any of its ERISA Affiliates.
 
 
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(w)            Shareholder Votes . The Seller will at all times own all of the issued and outstanding Capital Stock of the Company. The Seller will not vote in favor of any Specified Matter (as defined in the Bye-laws of the Company) unless all of the directors of the Company (including the independent director) have voted in favor of such Specified Matter.
 
Section 4.02.   Transfer of Sold Assets .  The Seller understands that the Company intends to pledge the related Sold Assets and its rights under this Agreement to the Indenture Trustee under the Indenture, and hereby consents to the assignment of all or any portion of this Agreement to the Indenture Trustee.  The Seller agrees that upon such assignment and upon the occurrence of an Event of Default under the Indenture, the Indenture Trustee may exercise the rights of the Company hereunder and shall be entitled to all of the benefits of the Company hereunder.
 
ARTICLE V
 
CONDITIONS PRECEDENT
 
Section 5.01.   Conditions to the Company’s Obligations .  The obligations of the Company to acquire Sold Assets on any Transfer Date shall be subject to the satisfaction of the following additional conditions:
 
(a)           All representations and warranties of the Seller contained in this Agreement shall be true and correct on the Transfer Date (including, without limitation, the Container Representations and Warranties) with the same effect as though such representations and warranties had been made on such date;
 
(b)           All information concerning such Sold Assets provided to the Company shall be true and correct in all material respects;
 
(c)           The Seller shall have performed all other obligations required to be performed by the provisions of this Agreement and the other Related Documents;
 
(d)           All corporate and legal proceedings and all instruments in connection with the transactions contemplated by this Agreement shall be satisfactory in form and substance to the Company, and the Company shall have received from the Seller copies of all documents (including without limitation records of corporate proceedings) relevant to the transactions herein contemplated as the Company may reasonably have requested;
 
(e)           No Event of Default, Early Amortization Event or Manager Default (or event or condition which, with the giving of notice or the passage of time or both, would constitute an Event of Default, Early Amortization or Manager Default) shall have occurred and then be continuing, or would result from the acquisition of, such Sold Assets; and
 
 
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(f)           The Company has adequate means of financing available in order to complete the acquisition of such Sold Assets.
 
Notwithstanding the foregoing conditions precedent, upon the making of a transfer of Sold Assets hereunder, all of the Company’s rights under this Agreement (and by operation of law with respect to such Sold Assets) shall vest in the Company, whether or not the conditions precedent to such transfer were in fact satisfied.
 
Section 5.02.   Conditions to the Seller’s Obligations .  The obligations of the Seller to convey and contribute the Sold Assets on any Transfer Date shall be subject to the satisfaction of the following additional conditions:
 
(a)           All representations and warranties of the Company contained in this Agreement shall be true and correct with the same effect as though such representations and warranties had been made on such date; and
 
(b)           All corporate and legal proceedings and all instruments in connection with the transactions contemplated by this Agreement shall be satisfactory in form and substance to the Seller, and the Seller shall have received from the Company copies of all documents (including without limitation records of corporate proceedings) relevant to the transactions herein contemplated as the Seller may reasonably have requested.
 
ARTICLE VI
 
TERMINATION
 
Section 6.01.   Termination .  The respective obligations and responsibilities of the Seller and the Company created by this Agreement shall not terminate until such time as each Transferred Container owned by the Company has been sold or is the subject of a Casualty Loss.
 
Section 6.02.   Effect of Termination .  No termination or rejection or failure to assume the executory obligations of this Agreement in the bankruptcy of the Seller or the Company shall be deemed to impair or affect the obligations pertaining to any executed conveyance or executed obligations, including without limitation breaches of representations and warranties by the Seller or the Company occurring prior to the date of such termination.  Without limiting the foregoing, prior to termination, neither the failure of the Seller to execute and to deliver a Container Sale Certificate pursuant to Section 2.02, nor the failure of the Seller to pay in cash or kind the compensation therefor shall render such transfer or obligation executory, nor shall the continued duties of the parties pursuant to Article 4 or Section 7.01 of this Agreement render an executed conveyance executory.
 
 
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ARTICLE VII
 
INDEMNIFICATION PAYMENTS
 
Section 7.01.   Indemnification .  The Seller agrees, to indemnify and hold harmless on an After-Tax Basis the Company, the Indenture Trustee, each Noteholder, each Interest Rate Hedge Provider and their respective officers, directors, employees and agents (each, an “Indemnified Party”) against any and all liabilities, losses, damages, penalties, costs and expenses (including legal fees and expenses) which may be incurred or suffered by such Indemnified Party or which may be claimed against such Indemnified Party (except to the extent caused by the gross negligence or willful misconduct of the Indemnified Party) including, without limitation, as a result of claims, actions, suits or judgments asserted or imposed against an Indemnified Party and directly or indirectly arising out of, or relating to (or alleged to be directly or indirectly arising out of or relating to) (a) an action or inaction by the Seller that is contrary to the terms of this Agreement or any other Related Document to which it is a party, (b) a breach by the Seller of any of its covenants set forth in this Agreement or any other Related Document to which it is a party, (c) any information certified in any schedule delivered by the Seller being untrue in any material respect as of the date of such certification or (d) any representation or warranty of the Seller having been false or misleading in any material respect when made or deemed made herein or in any Related Document or in any document or instrument delivered pursuant to any of the foregoing; provided , that the foregoing indemnity shall be limited to the matters set forth in paragraphs (a), (b), (c) and (d) above and shall in no way be construed to constitute credit recourse to the Seller for losses arising from the financial inability of any Lessee to make its rental payments owed under the related Leases and/or the failure of the Company to realize an amount equal to the sum of (i) the Net Book Value (or, if applicable, the Finance Lease Balance) of a Transferred Container and (ii) the Fair Market Value of the Transferred Assets attributable to such Transferred Containers.  The obligations of the Seller under this Section 7.01 shall survive the termination of this Agreement.
 
ARTICLE VIII
 
MISCELLANEOUS PROVISIONS
 
Section 8.01.   Amendment .  The terms of this Agreement may be amended, modified or waived only by a written instrument signed by the Seller and the Company and only if (a) such amendment or modification is approved by the Persons specified in Section 1002(b) of the Indenture, if such amendment or modification would cause any of the events set forth in Section 1002(b)(i) through (vii) of the Indenture to occur; (b) such amendment or modification is approved by the Requisite Global Majority if any such amendment or modification would adversely affect the rights or remedies available to the Noteholders; and (c) the Rating Agency Condition is satisfied in all other instances not addressed in clauses (a) and (b).  The Company shall forward or caused to be forwarded copies of any amendment to the Contribution and Sale Agreement to the Rating Agencies and the Administrative Agent.
 
Section 8.02.   GOVERNING LAW .  THIS AGREEMENT SHALL BE CONSTRUED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAWS BUT OTHERWISE WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAW, AND THE RIGHTS, OBLIGATIONS AND REMEDIES OF THE PARTIES HERETO SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
 
 
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Section 8.03.   CONSENT TO JURISDICTION .  ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE SELLER OR THE COMPANY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY, MAY BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE STATE OF NEW YORK AND THE SELLER AND THE COMPANY HEREBY WAIVE ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND, SOLELY FOR THE PURPOSES OF ENFORCING THIS AGREEMENT, THE SELLER AND THE COMPANY EACH HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.  THE SELLER AND THE COMPANY HEREBY IRREVOCABLY APPOINT AND DESIGNATE CSC CORPORATION SERVICE COMPANY, HAVING AN ADDRESS AT 1180 AVENUE OF THE AMERICAS, SUITE 210, NEW YORK, NEW YORK 10036-8401, ITS TRUE AND LAWFUL ATTORNEY-IN-FACT AND DULY AUTHORIZED AGENT FOR THE LIMITED PURPOSE OF ACCEPTING SERVICE OF LEGAL PROCESS AND THE SELLER AND THE COMPANY EACH AGREE THAT SERVICE OF PROCESS UPON SUCH PARTY SHALL CONSTITUTE PERSONAL SERVICE OF SUCH PROCESS ON SUCH PERSON.  THE SELLER AND THE COMPANY SHALL EACH MAINTAIN THE DESIGNATION AND APPOINTMENT OF SUCH AUTHORIZED AGENT UNTIL ALL AMOUNTS PAYABLE UNDER THIS AGREEMENT AND THE INDENTURE SHALL HAVE BEEN PAID IN FULL.  IF SUCH AGENT SHALL CEASE TO SO ACT, THE SELLER OR THE COMPANY, AS THE CASE MAY BE, SHALL IMMEDIATELY DESIGNATE AND APPOINT ANOTHER SUCH AGENT SATISFACTORY TO THE INDENTURE TRUSTEE AND SHALL PROMPTLY DELIVER TO THE INDENTURE TRUSTEE EVIDENCE IN WRITING OF SUCH OTHER AGENT’S ACCEPTANCE OF SUCH APPOINTMENT.
 
Section 8.04.   Judgment Currency .  Dollars shall be the currency of account in the case of all obligations under the Related Documents.  The payment obligations of the Company, the Seller, the Manager and the Indenture Trustee under the Related Documents shall not be discharged by an amount paid in a currency, or in a place other than that specified with respect to such obligations, whether pursuant to a judgment or otherwise, to the extent that the amount so paid on prompt conversion to Dollars and transfer to the specified place of payment under normal banking procedures does not yield the amount of Dollars, in such place, due under the governing Related Documents.  In the event that any payment, whether pursuant to a judgment or otherwise, upon conversion and transfer does not result in payment of such amount of Dollars in the specified place of payment, the obligee of such payment shall have a separate cause of action against the party making the same for the additional amount necessary to yield the amount due and owing under such Related Documents.  If, for the purpose of obtaining a judgment in any court with respect to any obligation of a party under any of the Related Documents or any of the agreements contemplated thereby, it shall be necessary to convert to any other currency any amount in Dollars due thereunder and a change shall occur between the rate of exchange applied in making such conversion and the rate of exchange prevailing on the date of payment of such judgment, the respective judgment debtor agrees to pay such additional amounts (if any) as may be necessary to insure that the amount paid on the date of payment is the amount in such other currency which, when converted into Dollars and transferred to New York, New York, in accordance with normal banking procedures will result in the amount then due under the respective Related Document in Dollars.  Any amount due from the respective judgment debtor shall be due as a separate debt and shall not be affected by or merged into any judgment being obtained for any other sum due under or in respect of any Related Document.  In no event, however, shall the respective judgment debtor be required to pay a larger amount in such other currency, at the rate of exchange in effect on the date of payment than the amount of Dollars stated to be due under the respective Related Document, so that in any event the obligations of the respective judgment debtor under the Related Document will be effectively maintained as Dollar obligations.
 
 
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Section 8.05.   Notices .  All demands, notices, and communications under this Agreement shall be in writing personally delivered, or sent by facsimile (with subsequent telephone confirmation of receipt thereof) or sent by overnight courier service, at the following address:  (a) CAL at its address at Suite 102, Bush Hill, Bay Street, St. Michael, Barbados, West Indies, Telephone: (246) 430-5310, Telefax:  (246) 430-5312, Attention:  CEO and CFO, with a copy to CAI International, Inc. 1 Market Plaza, Suite 900, San Francisco, CA 94105, Telephone: (415) 788-0100, Telefax: (415) 788-3430, Attention:  CEO and CFO, and the Company, at its address at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda, Telephone: (441) 295-5950, Telefax: (441) 292-4720, Attention:  Secretary, with copies to (i) CAI International, Inc. 1 Market Plaza, Suite 900, San Francisco, CA 94105, Telephone: (415) 788-0100, Telefax: (415) 788-3430, Attention:  CEO and CFO and (ii) Container Applications Limited, Suite 102, Corporate Centre, Bush Hill, Bay Street, St. Michael, Barbados, West Indies, Telephone: (246) 430-5310, Telefax: (246) 430-5312 Attention:  CEO and CFO, and (b) the Indenture Trustee, the Noteholders, the Rating Agencies and the Administrative Agent at their respective addresses set forth in the Supplement or other Related Documents.  Notice shall be effective and deemed received (a) two days after being delivered to the courier service, if sent by courier, (b) upon receipt of confirmation of transmission, if sent by telecopy, or (c) when delivered, if delivered by hand.  Either party may alter the address to which communications are to be sent by giving notice of such change of address in conformity with the provisions of this Section 8.05 for giving notice and by otherwise complying with any applicable terms of this Agreement.
 
Section 8.06.   Severability of Provisions .  If any one or more of the covenants, agreements, provisions, or terms of this Agreement shall be for any reason whatsoever held invalid, then such covenants, agreements, provisions, or terms shall be deemed severable from the remaining covenants, agreements, provisions, or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement.
 
Section 8.07.   Assignment .  Notwithstanding anything to the contrary contained in this Agreement, this Agreement may not be assigned (by operation of law or otherwise) by the Seller without (x) prior notice to the Rating Agencies and (y) the prior written consent of the Company or its assignee and the Indenture Trustee (acting at the direction of the Requisite Global Majority).  Except as provided in Section 4.02, this Agreement may not be assigned by the Company without prior notice to the Rating Agencies and the prior written consent of the Indenture Trustee (acting at the direction of the Requisite Global Majority).  Whether or not expressly stated, all representations, warranties, covenants and agreements of the Seller and the Company in this Agreement, or in any document delivered by any of them in connection with this Agreement, shall be for the benefit of the Indenture Trustee, the Noteholders and each Interest Rate Hedge Counterparty.
 
 
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Section 8.08.   Further Assurances .  The Seller and the Company agree, at the sole cost and expense of the Seller, to do such further acts and things and to execute and deliver such additional assignments, agreements, powers and instruments as are reasonably requested by the Indenture Trustee, any Noteholder or the Administrative Agent required to carry into effect the purposes of this Agreement or any Related Document or to better assure and confirm unto the Indenture Trustee or the Noteholders their rights, powers and remedies hereunder.
 
Section 8.09.   No Waiver; Cumulative Remedies .  No failure to exercise and no delay in exercising, on the part of the Company or the Seller, any right, remedy, power or privilege hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise hereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and privilege provided by law.
 
Section 8.10.   Counterparts .  This Agreement may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which shall constitute one and the same instrument.  Delivery of an executed counterpart of this Agreement by facsimile or by electronic means shall be equally effective as the delivery of an originally executed counterpart.
 
Section 8.11.   Binding Effect .  This Agreement will inure to the benefit of and be binding upon the parties hereto and, upon the transfer contemplated by Section 4.02 hereof, the Indenture Trustee, the Noteholders and their respective successors and permitted assigns.
 
Section 8.12.   Merger and Integration .  Except as specifically stated otherwise herein, this Agreement and the other Related Documents sets forth the entire understanding of the parties relating to the subject matter hereof, and all prior understandings, written or oral, are superseded by this Agreement.  This Agreement may not be modified, amended, waived or supplemented except as provided herein.
 
Section 8.13.   Headings .  The headings herein are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof.
 
Section 8.14.   Schedules and Exhibits .  The schedules and exhibits attached hereto and referred to herein shall constitute a part of this Agreement and are incorporated into this Agreement for all purposes.
 
Section 8.15.   General Interpretive Principles .  For purposes of this Agreement except as otherwise expressly provided or unless the context otherwise requires:
 
(a)           the terms defined in this Agreement have the meanings assigned to them in this Agreement and include the plural as well as the singular, and the use of any gender herein shall be deemed to include the other gender;
 
(b)           accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles as in effect on the Closing Date;
 
 
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(c)           references herein to “Articles”, “Sections”, “Subsections”, “paragraphs”, and other subdivisions without reference to a document are to designated Articles, Sections, Subsections, paragraphs and other subdivisions of this Agreement;
 
(d)           a reference to a Subsection without further reference to a Section is a reference to such Subsection as contained in the same Section in which the reference appears, and this rule shall also apply to paragraphs and other subdivisions;
 
(e)           the words “herein”, “hereof”, “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular provision; and
 
(f)            the term “include” or “including” shall mean without limitation by reason of enumeration.
 
Section 8.16.   WAIVER OF JURY TRIAL .  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, AS AGAINST THE OTHER PARTIES HERETO, ANY RIGHTS IT MAY HAVE TO A JURY TRIAL IN RESPECT OF ANY CIVIL ACTION OR PROCEEDING (WHETHER ARISING IN CONTRACT OR TORT OR OTHERWISE), INCLUDING ANY COUNTERCLAIM, ARISING UNDER OR RELATING TO THIS AGREEMENT OR ANY OTHER OPERATIVE DOCUMENT, INCLUDING IN RESPECT OF THE NEGOTIATION, ADMINISTRATION OR ENFORCEMENT HEREOF OR THEREOF.
 
Section 8.17.   Waiver of Immunity .  To the extent that any party hereto or any of its property is or becomes entitled at any time to any immunity on the grounds of sovereignty or otherwise from any legal actions, suits or proceedings, from set-off or counterclaim, from the jurisdiction or judgment of any competent court, from service of process, from execution of a judgment, from attachment prior to judgment, from attachment in aid of execution, or from execution prior to judgment, or other legal process in any jurisdiction, such party, for itself and its successors and assigns and its property, does hereby irrevocably and unconditionally waive, and agrees not to plead or claim, any such immunity with respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Agreement, the other Related Documents or the subject matter hereof or thereof, subject, in each case, to the provisions of the Related Documents and mandatory requirements of applicable law.
 
Section 8.18.   Third Party Beneficiary .  The Issuer and the Seller hereby acknowledges and agrees that each of the Indenture Trustee, the Administrative Agent, each Interest Rate Hedge Provider and each Indemnified Party is an express third party beneficiary of this Agreement.
 
Section 8.19.   Consent of the Control Party .  So long as no Rating Agency maintains an effective rating with respect to the Series 2012-1 Notes, the Company shall not take, and will cause others acting on behalf of the Company to not take, any action that requires satisfaction of the Rating Agency Condition or the consent of the Rating Agencies (or any analogous concept) as a condition precedent unless such action shall have also been approved by the Control Party for Series 2012-1.
 
 
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IN WITNESS WHEREOF, the Seller and the Company have caused this Agreement to be duly executed by their respective officers as of the day and year first above written.
 
 
CONTAINER APPLICATIONS LIMITED
 
       
 
By:
/s/ Timothy B. Page    
  Name:  Timothy B. Page  
  Title: Chief Financial Officer  
 
 
 
 

 
CAL FUNDING II LIMITED
 
       
 
By:  
/s/ Timothy B. Page  
 
Name:
Timothy B. Page  
 
Title:  
Chief Financial Officer  

 
2
 

EXHIBIT A
 
LIST OF TRANSFERRED CONTAINERS TRANSFERRED BY CAL
ON THE INITIAL FUNDING DATE
 
 
 
 
 
EXHIBIT B
 
CONTAINER SALE CERTIFICATE
 
CONTAINER APPLICATIONS LIMITED (the “Seller”) and CAL FUNDING II LIMITED (the “Company”), pursuant to the Contribution and Sale Agreement, dated as of October 18, 2012 (as amended, modified or supplemented from time to time in accordance with the terms hereof, the “Agreement”), hereby confirm their understandings with respect to [(i) the transfer by the Seller to the Company of the Containers listed on Schedule 1 attached hereto (the “Transferred Containers”) and Transferred Assets] [and (ii) the transfer by the Company to the Seller of the Containers listed on Schedule 2 attached hereto (the “Released Containers”) and Transferred Assets as of [insert date]] (the “Transfer Date”).  Capitalized terms used and not otherwise defined herein shall have the meanings set forth in the Agreement.
 
Conveyance of Containers .  The Seller hereby transfers and conveys to the Company all of the Seller’s right, title and interest in, to, and under the Transferred Containers and Transferred Assets.  Such transfer and conveyance is made without recourse to the Seller except to the extent provided in the Agreement.  [The Company hereby transfers and conveys to the Seller all of the Company’s rights, title and interest in, to, and under the Released Containers and Transferred Assets.  Such transfer and conveyance is made without recourse to the Company except to the extent provided in the Agreement.]
 
The Seller hereby certifies that:
 
(1)         As of the Transfer Date, the Seller was not insolvent under the Insolvency Law and will not be rendered insolvent by the transactions contemplated hereby; the Seller is paying its debts as they become due and, after giving effect to the transactions contemplated hereby, will have adequate capital to conduct its business.
 
(2)         Each Transferred Container is an Eligible Container on the Transfer Date.
 
(3)         The sum of the Net Book Value and Finance Lease Balance of all Transferred Containers as of __________ is $_____.  The Net Book Value or Finance Lease Value, as the case may be, of each Transferred Container as of the Transfer Date is as set forth in Schedule 2.
 
THE SOLD ASSETS ARE CONVEYED ON AN “AS IS-WHERE IS” BASIS, WITHOUT ANY REPRESENTATION OR WARRANTY WHATSOEVER, EXCEPT AS SET FORTH IN ARTICLE III OF THE AGREEMENT.
 
 
 
 
 
All terms and conditions of the Agreement with respect to the Company, the Seller and the Sold Assets are hereby ratified, confirmed and incorporated herein.
 
  CONTAINER APPLICATIONS LIMITED  
       
  By:     
  Name:    
  Title:    
 
  CAL FUNDING II LIMITED  
       
  By:    
  Name:     
  Title:     
 
 
 
 
 
SCHEDULE 3.01
 
OTHER LEGAL NAMES AND DOING BUSINESS NOTICE
 
Container Applications Limited’s legal name is and has been the same since the date of its formation.
 
 
EXHIBIT 99.3
 
PERFORMANCE GUARANTY
 
This PERFORMANCE GUARANTY, dated as of October 18, 2012 (this “ Performance Guaranty ”), is made by CAI International, Inc., a corporation organized and existing under the laws of the State of Delaware (together with its successors and assigns, the “ Company ”), for the benefit of Wells Fargo Bank, National Association, as indenture trustee (together with its successors and assigns in such capacity, the “ Indenture Trustee ”) under the Indenture, dated as of October 18, 2012 (as amended, modified or supplemented from time to time in accordance with its terms, the “ Indenture ”) between CAL Funding II Limited, an exempted company with limited liability incorporated under the laws of Bermuda (together with its successors and permitted assigns, the “ Issuer ”), and the Indenture Trustee.
 
PRELIMINARY STATEMENTS
 
WHEREAS, simultaneously with the execution of this Performance Guaranty, the Company, the Issuer and Container Applications Limited, a company organized under the laws of Barbados (“ CAL ” or the “ Manager ”), are entering into a Container Management Services Agreement (as amended, modified or supplemented from time to time in accordance with its terms, the “ Management Agreement ”);
 
WHEREAS , it is a condition precedent to the entering into of the transactions contemplated by the Management Agreement that the Company shall have executed and delivered this Performance Guaranty;
 
WHEREAS , the Company owns, directly or indirectly, one hundred percent of the capital stock of CAL and the Company will obtain substantial direct and indirect benefit from the execution and delivery of the Management Agreement and is willing to provide this Performance Guaranty on the terms and conditions set forth herein.
 
NOW, THEREFORE , in consideration of the premises and other consideration, the receipt and sufficiency of which are hereby acknowledged by the Company, the Company hereby agrees as follows:
 
SECTION 1.    Definitions .   Capitalized terms used but not otherwise defined herein shall have the respective meanings set forth in the Management Agreement (including terms incorporated therein by reference).
 
SECTION 2.    Unconditional Undertaking; Enforcement .   (a)  The Company hereby unconditionally and irrevocably undertakes and agrees with and for the benefit of the Indenture Trustee and each Secured Party (each, a " Supported Party ") that, in the event that CAL shall fail in any manner whatsoever to perform or observe any of the terms covenants, conditions, agreements and undertakings to be performed or observed by CAL under the Management Agreement in accordance with the terms thereof, including, without limitation, all indemnity obligations of the Manager under the Management Agreement, all servicing obligations of the Manager under the Management Agreement, and any obligation to pay costs, expenses and/or taxes incurred in connection with the Management Agreement (all such terms, covenants, conditions, agreements and undertakings on the part of the Manager to be performed or observed being collectively called the " Guaranteed Obligations "), when the same shall be required to be performed or observed under the Management Agreement, then the Company shall guarantee and ensure that the Manager duly and punctually performs and observes (or, alternatively, the Company will perform on behalf of the Manager) each such Guaranteed Obligation. It shall not be a condition to the accrual of the obligation of the Company hereunder to guarantee and ensure the performance or observance of any of the Guaranteed Obligations that any Supported Party shall have first made any request of or demand upon or given any notice to CAL or any other Person or have instituted any action or proceeding against CAL or any other Person in respect thereof.
 
 
 
 
 
(b)           The Supported Parties may proceed to enforce the obligations of the Guarantor under this Section 2 after the Manager's failure to perform any such obligations in accordance with the terms of the Management Agreement without first pursuing or exhausting any right or remedy which such Supported Party may have against the Manager or any other Person.
 
SECTION 3.    Obligations Absolute .
 
(a)           This Performance Guaranty shall constitute a guaranty of payment and of performance and not of collection, and the Company specifically agrees that it shall not be necessary, and that the Company shall not be entitled to require, before or as a condition of enforcing the obligations of the Company under this Performance Guaranty or requiring payment or performance of the Guaranteed Obligations by the Company hereunder, or at any time thereafter, that any Person: (i) file suit or proceed to obtain or assert a claim for personal judgment against the Manager or any other Person that may be liable for any Guaranteed Obligations; (ii) make any other effort to obtain payment or performance of any Guaranteed Obligations from the Manager or any other Person that may be liable for such Guaranteed Obligations; (iii) foreclose against or seek to realize upon any security now or hereafter existing for such Guaranteed Obligations; (iv) exercise or assert any other right or remedy to which such Person is or may be entitled in connection with any Guaranteed Obligations or any security or other guaranty therefor; or (v) assert or file any claim against the assets of any other Person liable for any Guaranteed Obligations. Notwithstanding anything herein to the contrary, no provision of this Performance Guaranty shall require the Company to pay, perform or discharge any Guaranteed Obligations prior to the time such Guaranteed Obligations are due and payable. When making any demand hereunder against the Company, the Indenture Trustee or other Supported Party need not make a similar demand on the Manager.
 
(b)           The Company agrees that this Performance Guaranty shall be continuing and the Company guarantees that the Guaranteed Obligations will be paid and performed strictly in accordance with the terms of the Management Agreement, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of the Indenture Trustee and/or any other Supported Party with respect thereto. If for any reason the Manager shall fail to fully and timely pay or perform and discharge any Guaranteed Obligations to be paid or performed by the Manager (whether affirmative or negative in character), the Company shall promptly on demand by the Indenture Trustee and/or any other Supported Party pay or perform or cause to be paid or performed, as the case may be, such Guaranteed Obligations. Each of the obligations of the Company under this Performance Guaranty is separate and independent of each other obligation of the Company under this Performance Guaranty and separate and independent of the Guaranteed Obligations, and the Company agrees that a separate action or actions may be brought and prosecuted against the Company to enforce this Performance Guaranty, irrespective of whether any action is brought against the Manager or whether the Manager is joined in any such action or actions. The obligations of the Company shall be continuing and irrevocable, absolute and unconditional, primary and original and immediate and not contingent and shall remain in full force and effect without regard to and not be released, discharged or in any way affected by any circumstance or condition (other than by payment in full of the Guaranteed Obligations) including, without limitation, the occurrence of any one or more of the following:
 
(i)           any lack of validity or enforceability of any of the Guaranteed Obligations under the Management Agreement or any document entered into in connection with the transactions contemplated by the Management Agreement, any provision thereof, or any other agreement or instrument relating thereto or the absence of any action to enforce the same;
 
 
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(ii)         any failure, omission, delay or lack on the part of the Indenture Trustee or other Supported Party to enforce, assert or exercise any right, power, privilege or remedy conferred on the Indenture Trustee (as assignee of the Issuer) in the Management Agreement, or the inability of the Indenture Trustee or other Supported Party to enforce any provision of the Management Agreement for any reason, or any other act or omission on the part of the Indenture Trustee or any other Supported Party;
 
(iii)        any change in the time, manner or place of performance or of payment, or in any other term of, all or any of the Guaranteed Obligations, or any other modification, supplement, amendment or waiver of or any consent to departure from the terms and conditions of the Management Agreement or any document entered into in connection with the transactions contemplated by the Management Agreement;
 
(iv)        any taking, release or amendment or waiver of or consent to departure from any other guaranty, for all or any of the Guaranteed Obligations or the acceptance of any security therefor;
 
(v)         the waiver by the Indenture Trustee and/or any other Supported Party of the performance or observance by the Manager of any of the Guaranteed Obligations, the waiver of any default in the performance or observance thereof, any extension consented to by the Indenture Trustee of the time for payment or performance and discharge by the Manager of any Guaranteed Obligations or any extension, indulgence or renewal of any Guaranteed Obligations;
 
(vi)        any bankruptcy, suspension of payments, insolvency, sale of assets, winding-up, dissolution, liquidation, receivership or reorganization of, or similar proceedings involving, the Manager or its assets or any resulting release or discharge of any of the Guaranteed Obligations;
 
(vii)       the recovery of any judgment against any Person or any action to enforce the same;
 
(viii)      any failure or delay in the enforcement of the Guaranteed Obligations of any Person under the Management Agreement or any document entered into in connection with the transactions contemplated by the Management Agreement or any provision thereof;
 
(ix)         any set-off, counterclaim, deduction, defense, abatement, suspension, deferment, diminution, recoupment, limitation or termination available with respect to any Guaranteed Obligations and, to the extent permitted by applicable law, irrespective of any other circumstances that might otherwise limit recourse by or against the Company or any other Person;
 
(x)          the obtaining, the amendment or the release of or consent to any departure from the primary or secondary obligation of any other Person, in addition to the Company, with respect to any Guaranteed Obligations;
 
(xi)         any compromise, alteration, amendment, modification, extension, renewal, release or other change, or waiver, consent or other action, or delay or omission or failure to act, in respect of any of the terms, covenants or conditions of the Management Agreement or any document entered into in connection with the transactions contemplated by the Management Agreement, or any other agreement or any related document referred to therein, or any assignment or transfer of any thereof;
 
 
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(xii)        any change in control in the ownership of the Manager, any change, merger, demerger, consolidation, restructuring or termination of the corporate structure or existence of the Manager or any of its Subsidiaries;
 
(xiii)       to the fullest extent permitted by applicable law, any other circumstance which might otherwise constitute a defense available to, or a discharge of, a guarantor or surety with respect to any Guaranteed Obligations;
 
(xiv)      any default, failure or delay, whether as a result of actual or alleged force majeure, commercial impracticability or otherwise, in the performance of the Guaranteed Obligations, or by any other act or circumstances which may or might in any manner or to any extent vary the risk of the Company, or which would otherwise operate as a discharge of the Company;
 
(xv)       the existence of any other obligation of the Company, or any limitation thereof, in the Management Agreement;
 
(xvi)      any regulatory change or other governmental action (whether or not adverse); or
 
(xvii)     the partial payment or performance of the Guaranteed Obligations (whether as a result of the exercise of any right, remedy, power or privilege or otherwise) or the invalidity of any payment for any reason whatsoever.
 
(c)           Should any money due or owing under this Performance Guaranty not be recoverable from the Company due to any of the matters specified in clauses (i) through (xviii) above or for any other reason, then, in any such case, such money shall nevertheless be recoverable from the Company as though the Company were principal debtor in respect thereof and not merely a guarantor and shall be paid by the Company forthwith.
 
(d)           This Performance Guaranty shall continue to be effective or be automatically reinstated, as the case may be, if at any time any payment, or any part thereof, of any of the Guaranteed Obligations is rescinded or must otherwise be restored or returned by the Indenture Trustee and/or any Supported Party for any reason whatsoever, whether upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Manager or otherwise, all as though such payment had not been made, and the Company agrees that it will indemnify the Indenture Trustee and each Supported Party on demand for all reasonable costs and expenses (including, without limitation, fees and disbursement of counsel) incurred by any such Person in connection with such rescission or restoration. If an event permitting the exercise of remedies under the Management Agreement shall at any time have occurred and be continuing and such exercise, or any consequences thereof provided in the Management Agreement, shall at such time be prevented by reason of the pendency against the Manager of a case or proceeding under a bankruptcy or insolvency law, the Company agrees that, for purposes of this Performance Guaranty and its obligations hereunder, amounts payable under the Management Agreement shall be deemed to have been declared in default, with all attendant consequences as provided in the Management Agreement as if such declaration of default and the consequences thereof had been accomplished in accordance with the terms of the Management Agreement, and the Company shall forthwith pay any amounts guaranteed hereunder, without further notice or demand.
 
SECTION 4.   Waiver .   The Company hereby waives promptness, diligence, notice of acceptance and any other notice with respect to any of the Guaranteed Obligations and this Performance Guaranty and any requirement that the Indenture Trustee or any other Supported Party protect, secure, perfect or insure any security interest or lien or any property subject thereto or exhaust any right or take any action against the Manager or any other Person or any collateral.
 
 
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SECTION 5.    Consent to Jurisdiction .   ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS PERFORMANCE GUARANTY MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FEDERAL COURT SITTING IN SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS PERFORMANCE GUARANTY, THE COMPANY CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE COMPANY IRREVOCABLY WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS PERFORMANCE GUARANTY OR ANY DOCUMENT RELATED HERETO OR THERETO. THE COMPANY WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
 
SECTION 6.    Representations and Warranties .   The Company hereby represents and warrants as follows:
 
(a)            Organization and Good Standing .  It is a corporation organized, validly existing and in compliance under the laws of the State of Delaware, with corporate power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted.
 
(b)            Due Qualification .  It is duly licensed, qualified and authorized to do business and is in good standing in each jurisdiction where the ownership, leasing or operation of its property or the conduct of its business requires such licensure or qualification except for failures to be so qualified which, individually or in the aggregate, could not reasonably be expected to have a material adverse effect on the business, operations, property, assets, Guaranteed Obligations, financial condition or prospects of Company.
 
(c)            Power and Authority; Due Authorization .  It has (i) all necessary power, authority and legal right to execute, deliver and perform its obligations under this Performance Guaranty and (ii) duly authorized by all necessary corporate action such execution, delivery and performance of this Performance Guaranty.
 
(d)            Binding Obligations .  This Performance Guaranty constitutes the legal, valid and binding obligation of Company, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law.
 
(e)            No Violation .  The execution, delivery and performance of this Performance Guaranty will not (i) conflict with, or result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time or both) a default under (A) the certificate of incorporation or by-laws of Company or (B) any Management Agreement, lease, loan agreement, receivables purchase agreement, mortgage, deed of trust, or other agreement or instrument to which Company is a party or by which it or its property is bound, (ii) result in or require the creation or imposition of any lien upon any of its properties pursuant to the terms of any such Management Agreement, lease, loan agreement, receivables purchase agreement, mortgage, deed of trust, or other agreement or instrument or (iii) violate any law or any order, rule, regulation applicable to Company of any court or of any federal, state or foreign regulatory body, administrative agency or other governmental instrumentality having jurisdiction over Company or any of its properties.
 
 
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(f)            Not Insolvent .  The execution, delivery and performance by the Company of this Performance Guaranty will not render the Company insolvent, nor is it being made in contemplation of the Company's insolvency; the Company does not, in its reasonable judgment, have an unreasonably small capital for conducting its business as presently contemplated by it.
 
(g)            Waiver of Immunity .  To the extent that the Company or any of its property is or becomes entitled at any time to any immunity on the grounds of sovereignty or otherwise from any legal actions, suits or proceedings, from set-off or counterclaim, from the jurisdiction or judgment of any competent court, from service of process, from execution of a judgment, from attachment prior to judgment, from attachment in aid of execution, or from execution prior to judgment, or other legal process in any jurisdiction, the Company, for itself and its successors and assigns and its property, does hereby irrevocably and unconditionally waive, and agrees not to plead or claim, any such immunity with respect to its obligations, Guaranteed Obligations or any other matter under or arising out of or in connection with this Performance Guaranty and the Management Agreement or the subject matter hereof or thereof, subject, in each case, to the provisions of each such agreement and mandatory requirements of applicable law.
 
SECTION 7.    Covenants .
 
7.1             Affirmative Covenants of the Company .   The Company agrees that, until the date (the " Final Payment Date ") upon which all payments, fees and other obligations of the Manager under the Management Agreement have been finally and fully paid and performed, the Company will, unless the Indenture Trustee shall otherwise consent in writing:
 
(a)            Compliance with Laws, Etc .   Comply in all material respects with all applicable laws, rules, regulations and orders.
 
(b)            Preservation of Existence .   Preserve and maintain its existence as a corporation, and its rights, franchises and privileges in the jurisdiction of its incorporation, and qualify and remain qualified in good standing as a foreign corporation in each jurisdiction where the failure to preserve and maintain such existence, rights, franchises, privileges and qualification could be reasonably expected to have a material adverse effect on the Company.
 
(c)            Performance of Obligations; Enforcement .  Punctually perform and observe all of its obligations and agreements contained in this Performance Guaranty.
 
SECTION 8.    Amendments, Etc . No amendment or waiver of any provision of this Performance Guaranty, and no consent to any departure by the Company herefrom, shall in any event be effective unless the same shall be in writing and signed by the Indenture Trustee and the Company, and then such waiver or consent shall be effective only in the' specific instance and for the specific purpose for which given.
 
SECTION 9.    Expenses . The Company will upon demand pay to the Indenture Trustee and each other applicable Supported Party the amount of any and all reasonable expenses, including reasonable attorneys' fees and expenses, which they may incur in connection with the exercise or enforcement of any of their respective rights or interests hereunder.
 
 
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SECTION 10.  Notices, Etc . All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including facsimile or e-mail communication) and shall be personally delivered or sent by express mail or courier or by certified mail, postage prepaid, or by facsimile or e-mail, if to the Company or the Indenture Trustee, at the address, facsimile number or e-mail address of such party set forth set forth on the signature page hereof or if to any other party, as set forth in the Management Agreement or the Indenture, as applicable, or at such other address, facsimile number or e-mail address as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective, (a) if personally delivered or sent by express mail or courier or if sent by certified mail, when received, and (b) if transmitted by facsimile or e-mail, when sent, receipt confirmed by telephone or electronic means.
 
SECTION 11.  No Waiver; Remedies .  No failure on the part of the Indenture Trustee or any other applicable Supported Party to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
 
SECTION 12.  Continuing Agreement .  This Performance Guaranty is a continuing agreement and shall (i) remain in full force and effect until the later of (x) the payment and/or performance in full of the Guaranteed Obligations and all other amounts payable under this Performance Guaranty and (y) one year and a day after the Final Payment Date, (ii) be binding upon the Company, its successors and assigns and (iii) inure to the benefit of, and be enforceable by, the Indenture Trustee, each Supported Party and any of their respective successors, transferees and assigns.
 
SECTION 13.  Waiver .  The Company hereby waives promptness, diligence, notice of acceptance and any other notice with respect to any of the Guaranteed Obligations and this Performance Guaranty and any requirement that any other Person protect, secure, perfect or insure any security interest or lien or any collateral subject thereto or exhaust any right or take any action against any other Person or any collateral. The Company hereby waives any right to revoke this Performance Guaranty and acknowledges that this Performance Guaranty is continuing in nature and applies to all Guaranteed Obligations, whether existing now or in the future. The Company hereby acknowledges receipt of copies of the Management Agreement as guarantor of the obligations thereunder, hereby makes all of the waivers and special agreements ("waivers") set forth in this Performance Guaranty, and agrees that each and all such waivers are being made knowingly, intentionally, voluntarily, without duress, and only after extensive consideration of the ramifications of such waivers by the Company in consultation with its legal counsel. The Company further acknowledges that this Performance Guaranty and such waivers are a material inducement to the Supported Parties to enter into the Management Agreement, and that the Supported Parties would not enter into the Management Agreement without such guaranty and waivers. The Company acknowledges and agrees that neither the Supported Parties nor any obligor, claimant or other party to any Management Agreement, nor any of their respective Affiliates, agents or representatives has made and no such person is making or shall be deemed to have made any representations or warranties with respect to this Performance Guaranty.
 
 
-7-
 
 
SECTION 14.  Subrogation .  The Company hereby irrevocably agrees that any claims or other rights it may have against any other Person that arise from the existence, payment, performance or enforcement of any obligation under this Performance Guaranty or any Guaranteed Obligation, including (without limitation) (a) any right of subrogation, reimbursement, exoneration, contribution or indemnification or (b) any right to participate in any claim or remedy of any Supported Party against any such Person, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including (without limitation) the right to take or receive from any such Person, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right, shall be subordinated to the Guaranteed Obligations. Until the latest of the payment in full in immediately available funds of the Guaranteed Obligations and the termination of the Management Agreement in accordance with their respective terms: (i) the Company shall not assert any such claims, exercise any such rights or otherwise seek compensation (or security therefor) for any payments made by it hereunder and (ii) any amounts, security or similar protection received by (or on behalf of) the Company shall be held in trust for the benefit of the Supported Parties, and shall promptly (but in any event within one Business Day) be paid to the Indenture Trustee to be applied in accordance with the Management Agreement.
 
SECTION 15.  GOVERNING LAW . THIS PERFORMANCE GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO CONFLICT OF LAWS PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).
 
SECTION 16.  WAIVER OF JURY TRIAL . EACH OF THE COMPANY AND THE INDENTURE TRUSTEE HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS PERFORMANCE GUARANTY OR THE ACTIONS OF THE INDENTURE TRUSTEE IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
 
[Signature page follows]
 
 
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IN WITNESS WHEREOF, the Company has caused this Performance Guaranty to be duly executed and delivered by its officer thereunto duly authorized as of the date first above written.
 
 
  CAI INTERNATIONAL INC.
   
   
  By: /s/ Victor Garcia
  Name: Victor Garcia
  Title: President and Chief Executive Officer
   
   
  Steuart Tower
  1 Market Plaza, Suite 900
  San Francisco, CA  94105
  Attention:  CEO and CFO
  Fax Number:  415-788-3430
 
                                        
EXHIBIT 99.4
 
Execution Version

 

 
CONTAINER PURCHASE AGREEMENT
 
Dated as of October 19, 2012
 
By and between

CONTAINER APPLICATIONS LIMITED,
a Barbados company
 
and

DRITTE SCHROEDER CONTAINER BETEILIGUNGSGESELLSCHAFT MBH & CO KG,
an Austrian company
 
 
 
 
 
CONTAINER PURCHASE AGREEMENT
 
This CONTAINER PURCHASE AGREEMENT (the “ Agreement ”) is entered into as of October 19, 2012, by and between CONTAINER APPLICATIONS LIMITED, a company organized and existing under the laws of Barbados ( “Buyer ”), and DRITTE SCHROEDER CONTAINER BETEILIGUNGSGESELLSCHAFT MBH & CO KG, a company organized and existing under the laws of Austria (“ Seller ”).
 
Recitals
 
A.            Seller is the lawful owner (as described hereinafter) of the Containers (as defined  in Section 1 below) and wishes to sell the Containers to Buyer, and Buyer wishes to purchase the Containers from Seller, all upon and subject to the terms and conditions of this Agreement.
 
B.             The Containers serve as collateral for a loan facility granted by HSH Nordbank AG, a bank organized and existing under the laws of Germany (“ HSH ”) to Seller and the title, co-title and expectation right in respect of the acquisition of title ( Anwartschaftsrecht ) to the Containers have been transferred by way of a Security Transfer Agreement dated June 29, 2006 between Seller and HSH from Seller to HSH.
 
C.             HSH, Buyer and Seller have agreed to enter into a certain Title Transfer Agreement (the "Title Transfer Agreement"), which will provide for (i) the transfer and assignment of all of HSH’s rights (in particular title, co-title and any expectation rights in respect of the acquisition of title (Anwartschaftsrecht)) to and interest in the Containers free of any Lien created by the Security Documents from HSH to CAL subject to ( aufschiebend bedingt )   the final and unconditional receipt of an amount of US $79,012,638.94 in the Concentration Account and (ii) the assignment of HSH’s claims against third parties for (re-)delivery of the Containers to the Buyer to the extent any third party has at the time of the aforementioned transfer immediate possession of the Containers. Further, the Title Transfer Agreement will provide for the assignment of the Sellers claims (if any) against HSH in case HSH has disposed over any Container in deviation to the agreements between HSH and the Seller (the “Sellers HSH-Claims”).
 
D.             Pursuant to that certain Amended and Restated Container Management Services Agreement dated as of June 28, 2006 (the “Management Agreement”), by and between the Seller and the Manager (defined in Section 1 below), the Manager manages the Containers.
 
E.             Buyer is a wholly owned subsidiary of the Manager.
 
F.             The Containers are either under lease by one or more third party container lessees under equipment leases arranged on behalf of the Seller by the Manager or one of its affiliates (the “Leases”) or off lease, in accordance with the terms of the Management Agreement.
 
G.             In connection with the sale of the Containers, the Manager and the Seller wish to terminate the Management Agreement, as a result of the purchase of the Containers by Buyer.
 
 
 
 
 
H.           The Seller has appointed its exclusive Agent Calbina Group Limited (“Calbina”) to arrange this transaction between the Seller and Buyer. Under the agreement between Seller and Calbina, Calbina is entitled to 3.0% (three percent) of the total Purchase Price as its agreed resale fee (the “Resale Fee”). The Resale Fee is included in the total Purchase Price and shall be paid exclusively by Seller in accordance with the payment instructions set forth in Sections 3.01(a) and (b) of this Agreement.
 
NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations and warranties herein contained, Seller and Buyer agree as follows:
 
1.             Definitions . All capitalized terms used herein and not defined herein have the meanings ascribed to such terms in the Management Agreement. For all purposes of this Agreement, the following terms shall have the following meanings:
 
“ Bill of Sale ” means a bill of sale substantially in the form attached hereto as Exhibit B.
 
“ Business Day ” means any day except a Saturday, Sunday, or other day on which banks in New York are authorized by law to close.
 
“ Certificate of Final Acceptance and Delivery ” means a certificate of acceptance and delivery substantially in the form attached hereto as Exhibit C.
 
“ Closing ” means the closing of the sale and purchase of the Containers contemplated by this Agreement.
 
“ Closing Date ” means the date on which the Closing shall occur as fixed pursuant to Section 4.
 
“ Containers “ means (a) the marine cargo shipping containers listed in Exhibit A hereto, and all of the Seller’s interest in such containers; (b) all of Seller’s right, title, and interest in and to and claims as well as obligations under the Leases; and (c) all of Seller's right, title and interest in and to any purchase agreement pursuant to which the Seller acquired any of the Containers and in and to warranties by the manufacturers or original sellers of the Containers (d) all of the Sellers HSH-Claims. The Containers are owned as described in Clause A and Clause B of the Recitals.
 
“ Cut-Off Date “ means July 31, 2012.
 
“ Effective Date ” means October 19, 2012.
 
“ Encumbrance ” means any charge, mortgage, lien, pledge, claim, restriction, security interest or other encumbrance whether created or arising by agreement, statute or otherwise at law, attaching to property, interest or rights and shall be construed in the widest possible terms and principles known under the law applicable to such property, interests or rights and whether or not they constitute a security interest as that term is understood under the laws of the State of California, U.S.A.
 
 
 
 
 
“ Manager ” means CAI International, Inc., a corporation organized and existing under the laws of Delaware, successor in interest to Container Applications International, Inc.
 
“ Purchase Price ” means the Purchase Price per unit price per Container for this Agreement to be purchased by Buyer as indicated hereunder. Purchase Price means an all inclusive total price, with respect to a Container. The total Purchase Price is the total dollar amount that Buyer must pay to Sellers Account to acquire title to all the Containers under this Agreement free and clear of Encumbrances.
 
   
Price per Unit
   
Quantity
   
Purchase Price
 
20' Containers
                 
Units
  $ 1,400       17,250     $ 24,150,000  
                         
40' Containers
                       
Units
  $ 2,240       6,705     $ 15,019,200  
                         
40' HC Containers
                       
Units
  $ 2,352       19,802     $ 46,574,304  
                         
Total
            43,757     $ 85,743,504  
 
“Reassignment Agreement” means the Termination and Reassignment Agreement dated as of October 19, 2012 by and between Seller, Bank and Schroeder.
 
“Schroeder” means Schroeder & Co Vertriebsgesellschaft mbH.
 
“Sellers Account” means the Concentration Account into which funds are to be wired pursuant to the Title Transfer Agreement, which account is as follows:
 
Account holder:
Dritte Schroeder Container
Beteiligungsgesellschaft mbH & Co. KG
   
Bank:
HSH Nordbank AG, Gerhard-Hauptmann-
Platz 50, 20095 Hamburg
   
Account Number:
1100316249
   
Swift Code:
HSHNDEHH
   
IBAN:
DE11210500001100316249
 
 
 
 
 
 “ Termination Agreement ” means that certain Termination Agreement to the Management Agreement in substantially the form attached hereto as Exhibit D.
 
“ Transaction Documents ” means this Agreement, the Bill of Sale, the Certificate of Acceptance and Delivery, the Title Transfer Agreement and the Termination Agreement.
 
2.            Sale and Purchase of the Containers .  On the Closing Date, for the consideration provided in Section 3 and subject to the terms and conditions set forth herein and the terms and conditions of the Title Transfer Agreement, (i) Seller shall sell to Buyer the Containers and (ii) shall assign, transfer and convey to Buyer all of its right, title, (if applicable) expectation rights in respect of the acquisition of title ( Anwartschaftsrecht ) and interest relating to the Containers from and after the Closing Date; (iii) HSH shall have released all collateral securing its loan to Seller and transferred and assigned its rights to the Containers, including without limitation, title, co-title and any expectation rights in respect of the acquisition of title ( Anwartschaftsrecht ) to Buyer, as contemplated in the Title Transfer Agreement; and (iv) Buyer shall purchase the Containers from the Seller and accepts aforesaid assignment, transfer and conveyance.
 
To the extent any third party has or acquires immediate possession of the Containers, the Seller from and after the Closing Date assigns to the accepting Buyer any and all of its claims for (re-)delivery of the Containers and acknowledges that after giving effect to this Agreement and the Title Transfer Agreement, Buyer will own the Containers and have all future claims for (re-)delivery of the Containers. Seller is not aware of any existing claims by any parties that may assert liens or other encumbrances of title that would be inconsistent with the clean title to be transferred pursuant to the Title Transfer Agreement.
 
3.              Consideration; Adjustment to Purchase Price; Revenue Allocations.
 
3.01           Consideration; Adjustment to Purchase Price:
 
(a)           In consideration for the sale of the Containers as contemplated in Section 2, the Purchase Price shall be paid by Buyer to the Seller by wire transfer of immediately available funds, as follows:

            (i)
On the Closing Date, Buyer shall pay to Seller 95% of the Purchase Price, of which Seventy-Nine Million Twelve Thousand Six Hundred Thirty-Eight Dollars and Ninety-Four Cents (US$79,012,638.94) to be deposited in the Seller’s Account and Two Million Four Hundred Forty-Three Thousand Six Hundred Eighty-Nine Dollars and Eighty-Six Cents (US$2,443,689.86) to be deposited in Calbina’s bank account to be informed by Calbina, pursuant to Seller’s instructions; and;
 
 
 
 
 
     (ii)
On December 15, 2012, Buyer to the shall pay to Seller the remaining 5% of the Purchase Price (the “Second Payment”), of which Four Million One Hundred Fifty-Eight Thousand Five Hundred Fifty-Nine Dollars and Ninety-Four Cents (US$4,158,559.94) (the “Hold Back”), less any sums from the Hold Back to be applied pursuant to Section 3.01(c), to be deposited in Seller’s Account and One Hundred Twenty-Eight Thousand Six Hundred Fifteen Dollars and Twenty-Six Cents (US$128,615.26) to be deposited in Calbina’s bank account to be informed by Calbina, pursuant to Seller’s instructions.
 
(b)           Seller hereby acknowledges that once the deposits under Sections 3.01(a)(i) and (ii) above are made by Buyer (or in the case of the Hold Back, applied as permitted in this Agreement), the full Purchase Price shall have been paid by Buyer to Seller and that the Resale Fee shall be borne exclusively by Seller.
 
(c)           The parties acknowledge that the aggregate Purchase Price to be paid pursuant to Section 3.01(a) above shall be based on Manager’s then best estimate of the number of Containers existing as of the Effective Date. On or before December 15, 2012 (the “Settlement Date”), Buyer shall provide the Seller with:  (i) the actual number of Containers existing as of the Effective Date along with such supporting documentation as the Seller may reasonably request; and (ii) an accounting of bad debt reserves that had been established by Manager pursuant to the Management Agreement. The amount of such bad debt reserves, if any, that were not applied under the Management Agreement shall be added to the Hold Back and if the actual bad debts under the Management Agreement exceed the amount of such bad debt reserves, the amount of such excess shall be applied to such bad debts and subtracted from the Hold Back.  In the event that the aggregate actual number of Containers as of the Effective Date is less than the aggregate number of Containers identified in the Bill of Sale delivered by the Seller at the Closing, then the Buyer shall entitled to offset the Purchase Price of the Containers not delivered on the Closing Date against the Hold Back, and if the respective Purchase Price for such Containers that are not delivered exceeds the Hold-Back, then Seller shall no later than five (5) Business Days following written notice, pay to Buyer by wire transfer the amount by which the aggregate Purchase Price of all Containers not delivered on the Closing Date exceeds the amount of the Hold Back that was offset against the Purchase Price of such Containers that were not delivered.  In the event that the aggregate actual number of Containers as of the Effective Date is greater than the aggregate number of Containers identified in the Bill of Sale delivered by the Seller at the Closing, Buyer shall, against receipt of a Bill of Sale for such additional Containers, pay Seller the respective Purchase Price by wire transfer of immediately available funds for each Container not delivered by Seller at the Closing.
 
3.02 Allocation of Revenues.   The parties acknowledge that all NOI accrued for all periods on or prior to the Cut-Off Date with respect to the Containers shall be for the account of and belong to the Seller and shall be paid to Seller pursuant to the Management Agreement. All Gross Revenues accrued for all periods commencing after the Cut-Off Date with respect to the Containers shall be for the account of and belong to Buyer.
 
 
 
 
 
4.              Closing .   The Closing shall take place at the offices of Buyer not later than October 19, 2012, or at such other date, time and place as Seller and Buyer shall mutually agree. Immediately upon the Closing, Seller shall be deemed to have delivered the Containers to Buyer and Buyer shall be deemed to have accepted the Containers from the Seller without any further action on the part of Buyer or Seller.
 
5.              Representations and Warranties of Seller .  Seller represents and warrants to Buyer as of the date hereof, as follows:
 
5.01  Existence, Power and Authority . Seller is a company, duly organized and validly existing under the laws of Austria, and has all requisite corporate authority to enter into the Transaction Documents, and to consummate the transactions contemplated hereby and thereby.
 
5.02  Authorization . The execution and delivery of the Transaction Documents by the Seller, and the performance by Seller hereunder and thereunder, have been duly authorized by all requisite corporate action and proceedings of Seller.
 
5.03  No Conflict . Neither the execution and delivery of the Transaction Documents by Seller, nor the performance by it hereunder or thereunder, will (i) violate, conflict with or constitute a default under any provision of its charter documents, (ii) conflict with or result in a breach of any indenture or other agreement to which Seller is a party, (iii) violate any judgment, order, injunction, decree or award of any court, administrative agency or governmental body against Seller, or (iv) constitute a violation by Seller of any law or regulation known by Seller to be applicable to Seller, except in any case where such violation would not have a material adverse effect on the financial condition of Seller or its ability to perform its obligations under this Agreement.
 
5.04   Consents . The execution, delivery and performance by Seller of, and the consummation of the transactions contemplated by the Transaction Documents do not require (i) any approval or notice to or consent of any person, which has not been obtained already, or (ii) any notice to or filing or recording with, or any consent or approval of, any governmental body.
 
5.05   Legal Proceedings . There are no actions, suits or proceedings pending, or to the knowledge of Seller, threatened, against Seller before any court, arbitrator, administrative or governmental body that, if adversely determined, would hinder or prevent Seller’s ability to carry out the transactions contemplated by the Transaction Documents, or affect the right, title or interest of Seller in its Containers, and, to its knowledge, there is no basis for any such suits or proceedings.
 
5.06  Title . Seller is the lawful and rightful sole owner of the Containers and has good right and title to sell the Containers to Buyer as described in Clause A, Clause B and Clause C of the Recitals. On the Closing Date, after giving effect to the payment of the Purchase Price of the Containers as contemplated by this Agreement and the Title Transfer Agreement, Buyer will receive and hold good and marketable title to (i) the Containers free and clear of all Encumbrances originating by, through, or under Seller and all other encumbrances of which Seller may be aware, except for the use and possessory interests of third party lessees as contemplated under the Management Agreement and (ii) the Sellers HSH-Claims.
 
 
 
 
 
5.07   Compliance with Laws and Regulations . To the knowledge of Seller, the sale of the Containers by Seller will not violate any provision of any applicable laws, orders or regulations.
 
6.             Representations and Warranties of Buyer .  Buyer represents and warrants to Seller as of the date hereof, as follows:
 
6.01  Corporate Existence, Power and Authority . Buyer is a company duly formed and validly existing under the laws of Barbados, and has the corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby.
 
6.02  Authorization . The execution and delivery by Buyer of this Agreement, and the performance by Buyer hereunder, have been duly authorized by all requisite corporate action and proceedings of Buyer and Buyer shall have provided Seller with a copy of the resolutions of Buyer's Board of Directors authorizing such execution, delivery and performance.
 
6.03   No Conflict . Neither the execution and delivery of this Agreement by Buyer, nor the performance by Buyer hereunder, will (i) violate, conflict with or constitute a default under any provision of Buyer’s Articles of Association or Bylaws, (ii) conflict with or result in a breach of any indenture or other agreement to which Buyer is a party, (iii) violate any judgment, order, injunction, decree or award of any court, administrative agency or governmental body against Buyer, or (iv) constitute a violation by Buyer of any law or regulation known by Buyer to be applicable to Buyer, except in any case where such violation would not have a material adverse effect on the financial condition of Buyer or its ability to perform its obligations under this Agreement.
 
6.04   Consents . The execution, delivery and performance by Buyer of this Agreement do not require (i) the approval or consent of or notice to any person, or (ii) any notice to or filing or recording with, or any consent or approval of, any governmental body.
 
6.05   Legal Proceedings . There are no actions, suits or proceedings pending, or to the knowledge of Buyer, threatened, against Buyer that, if adversely determined, would materially hinder or prevent Buyer’s ability to carry out the transactions contemplated by this Agreement, and, to Buyer’s knowledge, there is no basis for any such suits or proceedings.
 
6.06   Compliance with Laws and Regulations . To the knowledge of Buyer, the purchase of the Containers by Buyer will not violate any applicable laws, orders or regulations.
 
7.             Covenant related to Closing . Each of the parties shall use all reasonable efforts to fulfill or obtain the fulfillment of conditions set forth herein as they relate to such party on or prior to the Closing.
 
 
 
 
 
8.              Conditions Precedent to the Obligation of Buyer to Close . The obligation of Buyer to purchase the Containers pursuant to this Agreement is subject to the fulfillment on or prior to the Closing of the following conditions, any one or more of which may be waived by it:
 
8.01   Representations, Warranties and Covenants . The representations and warranties of Seller contained in this Agreement shall be true in all material respects on and as of the Closing with the same force and effect as though made on and as of such Closing. Seller shall have performed and complied with all covenants and agreements required by this Agreement and the Management Agreement to be performed or complied with by it on or prior to the Closing.
 
8.02   Delivery of Documents . The following documents shall have been delivered to Buyer on the Closing Date at the latest:
 
(a)           a Bill of Sale executed by Seller;
 
(b)           the Termination Agreement executed by Seller;
 
(c)            the Certificate of Final Acceptance and Delivery executed by Seller;
 
(d)           all other agreements, instruments, certificates and other documents reasonably requested by Buyer prior to the Closing Date to effect the transactions contemplated by this Agreement, including without limitation, termination statements and such other documents as may be necessary to terminate all liens of record encumbering the Containers;
 
(e)           Title Transfer Agreement executed by HSH and Seller in form and substance satisfactory to Buyer;
 
(f)            Reassignment Agreement executed by Seller, HSH and Schroeder in form and substance satisfactory to Buyer;
 
(g)           a copy of the resolutions of the Managing Director of the General Partner of the Seller approving and authorizing the execution and implementation by the Seller of the Transaction Documents;
 
(h)           a favorable legal opinion addressed to the Buyer, dated as of the Closing Date, in form and substance satisfactory to Buyer from Schönherr Rechtsanwälte GmbH, counsel to Seller; and
 
(i)            a certificate of the managing director of Seller's general partner to the effect that:  (i) he is familiar with the operations of Seller; and (ii) he is not aware of any liens, claims or encumbrances (whether or not originating by, through or under Seller) that encumber the Containers, other than use and possessory interests of third party lessees as contemplated under the Management Agreement and the rights of HSH described in Clause B of the Recitals.
 
8.03  Consents . Any required consent or approval of any other third person to the sale and transfer of the Containers to Buyer shall have been obtained, and Buyer shall have received evidence satisfactory to it of the same.
 
 
 
 
 
8.04  Satisfaction of Statutory and Regulatory Requirements . All statutory and other legal requirements for the valid consummation of the transactions contemplated by this Agreement shall have been fulfilled.
 
9.              Conditions Precedent to the Obligation of Seller to Close . The obligation of Seller to sell the Containers pursuant to this Agreement is subject to the fulfillment on or prior to the Closing of the following conditions, any one or more of which may be waived by it:
 
9.01  Representations, Warranties and Covenants . The representations and warranties of Buyer contained in the Agreement shall be true in all material respects on and as of the Closing with the same force and effect as though made on and as of such Closing. Buyer shall have performed and complied with all covenants and agreements required by this Agreement to be performed or complied with by it on or prior to the Closing.
 
9.02  Delivery of Funds and Documents . The Purchase Price required by Section 3.01(a)(i) shall have been duly delivered to Seller Account; and Buyer shall have duly executed and delivered to Seller all other agreements, instruments, certificates and other documents reasonably requested by Seller prior to the Closing Date to effect the transactions contemplated by this Agreement.
 
9.03  Satisfaction of Statutory and Regulatory Requirements . All statutory and other legal requirements for the valid consummation of the transactions contemplated by the Agreement shall have been fulfilled.
 
10.          Disclaimer of Warranties by Seller . EXCEPT FOR THE WARRANTY OF TITLE AS EXPRESSLY SET FORTH IN THE BILL OF SALE, AND THE REPRESENTATIONS AND WARRANTIES OF SELLER SET FORTH HEREIN, THE EQUIPMENT IS BEING SOLD TO BUYER BY SELLER “AS-IS” “WHERE­IS”, WITHOUT ANY OTHER REPRESENTATIONS AND WARRANTIES, WHETHER WRITTEN, ORAL, OR IMPLIED, AND SELLER SHALL NOT BY VIRTUE OF HAVING SOLD THE EQUIPMENT HEREWITH, BE DEEMED TO HAVE MADE ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, NOW OR HEREAFTER, AS TO THE CONDITION, DESIGN, OPERATION, MAINTENANCE, VALUE, MARKETABILITY, MERCHANTABILITY OR FITNESS FOR USE OR FOR A PARTICULAR PURPOSE OF ANY OF THE CONTAINERS OR AS TO THE QUALITY OF THE MATERIAL OR WORKMANSHIP OF ANY OF THE CONTAINERS AND ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, DEALING OR USAGE OF THE TRADE. Except as expressly set forth herein, Seller disclaims any liability to Buyer with respect to the Containers’ condition, including, without limitation, any liability in tort or arising from negligence, strict liability or for loss or interruption of use, profit or business or other consequential injury, and Buyer waives, releases, renounces and disclaims expectation of or reliance upon any such warranty or warranties.
 
11.            Survival of Representations and Warranties . All representations and warranties made herein, and the agreements set forth herein, shall survive the Closing.
 
 
 
 
 
12.           Further Assurances . Seller and Buyer agrees to execute, acknowledge, deliver, file and record, or cause to be executed, acknowledged, delivered, filed and recorded, such further documents or other papers, and to do all such things and acts, as the other parties may reasonably request in order to carry out the provisions and purposes of this Agreement and the transactions contemplated hereby. Seller shall send Buyer, upon its receipt thereof, all payments, notices, communications and any other documents with respect to the Containers which it receives subsequent to the Closing Date.
 
13.            Expenses and Sales Tax . Each party shall bear its expenses incurred in connection with the preparation, execution and performance of this Agreement and the transactions contemplated hereby, including, without limitation, all fees and expenses of its agents, representatives, counsel and accountants. Seller shall bear all costs associated with filing and recording the termination statements, assignments, releases and terminations described in Section 8.02 of this Agreement. It is the expectation of the parties that the transfer contemplated by this Agreement shall be exempt from state and local sales, use, transfer or similar taxes (“ Sales Tax ”).
 
14.            Brokers’ Fees . Except for the fees due by Seller to Calbina, Seller, on the one hand, and Buyer, on the other, represents and warrants to the other that neither it nor any of its affiliates have incurred any obligation or liability, directly or indirectly, for brokerage or finders’ fees or agents’ commissions or like payment in connection with this Agreement or the transactions contemplated hereby, and hereby indemnifies and each holds the other harmless therefor.
 
15.            Notices . Any notice, demand, or communication required or permitted to be given by any provision of this Agreement shall be in writing or transmitted electronically and shall be deemed to have been duly given when received, if personally delivered; upon confirmation of receipt (by use of “confirmation to sender ” or other means), if transmitted by telecopy or by electronic or digital transmission method; or on the next business day after it is sent, if sent for overnight delivery by a recognized overnight delivery service, charges prepaid, addressed as follows:

If to Buyer, to:
Container Applications Limited
Suite 102, Corporate Centre
Bush Hill, Bay Street
St, Michael
Barbados, West Indies
                Attention:         CEO and CFO
Fax Number – 1-246-430-5312

With a copy to:                     CAI International, Inc.
Steuart Tower
1 Market Plaza, Suite 900
San Francisco, California 94105
Attention:         CEO and CFO
Telephone:       (415) 788-0100
                                           Fax: (415) 788-3430
 
 
 
 

If to Seller,  to:
Dritte Schroeder Container Beteiligungsgesellschaft mbH & Co KG
Karolingerstrasse 36
A-5020 Salzburg
Austria
Attn: Jürgen B. Rahn
Via email: juergen.rahn@scs-bv.at
Telephone:  +43 662 8822330
                                                Fax:          +43 662 88223322
 
Any party by notice given in accordance with this Section to the other parties may designate another address or person for receipt of notices hereunder.
 
16.           Waivers and Amendments; Non-Contractual Remedies; Preservation of Remedies . This Agreement may be amended, superseded, modified, supplemented or terminated, and the terms hereof may be waived, only by written instrument signed by the parties or, in the case of a waiver, by the party waiving compliance. No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof. No waiver on the part of any party of any such right, power or privilege, nor any single or partial exercise of any such right, power or privilege, shall preclude any further exercise thereof or the exercise of any other such right, power or privilege. The rights and remedies herein provided are cumulative and are not exclusive of any rights or remedies that any party may otherwise have at law or in equity.
 
17.          Title Transfer Agreement as Condition Precedent . This Agreement will only become effective and binding between the parties if the Title Transfer Agreement has been signed by HSH, the Seller and the Buyer.
 
18.            Governing Law . This Agreement will be governed by and construed under the laws of the State of California.
 
19.            Binding Effect; Assignment . No party shall assign this Agreement to any other person without the prior written consent of all other parties. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. No assignment of this Agreement or of any rights hereunder shall relieve the assigning party of any of its obligations or liabilities hereunder. The Transaction Documents, and the certificates, schedules, annexes and other documents executed and delivered at or before the Closing in connection therewith are the complete agreement of the parties regarding the subject matter hereof and thereof and supersede all prior understandings (written or oral), communications and agreements.
 
20.           Counterparts . This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument.
 
 
 
 
 
21.            Severability . Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be effective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement, and the remainder of such provision and the remaining provisions of this Agreement shall be interpreted, to the maximum extent possible, so as to conform to the original intent of this Agreement.
 
22.            Indemnities.
 
(a)           Buyer will indemnify and hold Seller harmless from any liability, loss, cost or expense (“ Claim ”),   including reasonable attorneys’ fees, which shall result from (i) a material breach of any representation or warranty of Buyer contained in this Agreement or in any other agreement, instrument, certificate or other document delivered by Buyer pursuant hereto; or (ii) a material breach by Buyer of any of its covenants or agreements contained in this Agreement, any other agreement, instrument, certificate or other document delivered by Buyer in connection with the transactions contemplated by this Agreement. Upon payment of such indemnity, Buyer shall be subrogated to the indemnitee’s rights against any third parties respecting the Claims. Anything contained in this Agreement to the contrary notwithstanding, Buyer shall not be required to indemnify Seller if and to the extent Seller is indemnified and fully compensated for its Claim by a third party.
 
(b)           Seller will, indemnify and hold Buyer harmless from any Claim, including reasonable attorneys’ fees, which shall result from (i) a material breach of any representation or warranty of Seller contained in this Agreement or in any certificate or other document delivered by Seller pursuant hereto; or (ii) a material breach by Seller of any of its covenants or agreements contained in this Agreement, any other agreement, instrument, certificate or other document delivered by Seller in connection with the transactions contemplated by this Agreement. Upon payment of such indemnity, Seller shall be subrogated to Buyer’s rights against any third parties respecting the Claims.
 
(c)           A party seeking indemnification pursuant to Sections 22(a) or (b) above (an “ Indemnified Party ”)   shall give prompt notice to the party from whom such indemnification is sought (the “ Indemnifying Party ”)   of the assertion of any Claim, or the commencement of any action, suit or proceeding, in respect of which indemnification may be sought hereunder and will give the Indemnifying Party such information with respect thereto as the Indemnifying Party may reasonably request; but no failure to give such notice shall relieve the Indemnifying Party of any liability hereunder (except to the extent the Indemnifying Party has suffered actual prejudice thereby). The Indemnifying Party may, at its expense, participate in or assume the defense of any such action, suit or proceeding involving a third party; provided, however, that such defense is conducted with counsel mutually satisfactory to the Indemnified Party and the Indemnifying Party. The Indemnified Party and the Indemnifying Party shall consult with each other regarding the conduct of such defense. The Indemnified Party shall have the right (but not the duty) to participate in the defense thereof, and to employ counsel, at its own expense (except that the Indemnifying Party shall pay the fees and expenses of such counsel to the extent the Indemnified Party reasonably concludes that there is a conflict of interest between the Indemnified Party and the Indemnifying Party), separate from counsel employed by the Indemnifying Party in any such action. The Indemnifying Party shall be liable for the fees and expenses of counsel employed by the Indemnified Party if the Indemnifying Party has not assumed the defense thereof. Whether or not the Indemnifying Party chooses to defend or prosecute any Claim involving a third party, all the parties hereto shall cooperate in the defense or prosecution thereof and shall furnish such records, information and testimony, and attend at such conferences, discovery proceedings, hearings, trials and appeals, as may be reasonably requested in connection therewith. The Indemnifying Party shall not be liable under Sections 22(a) or 22(b) for any settlement effected without its written consent (as contemplated above) for any Claim, litigation or proceeding in respect of which indemnity may be sought hereunder. No Claim for indemnification, except Claims based on (i) a breach of the representations contained in Section 5.06 hereof, may be first initiated or asserted by any Indemnified Party against any Indemnifying Party after the second anniversary of the Closing Date.  In the event of any claim for indemnity hereunder by Buyer that occurs prior to the date on which the Hold Back Amount is due, Buyer may withhold from the payment of the Holdback Amount an amount equal to Buyer's good faith estimate of damages.  At such time as the claim for indemnity is resolved, if Buyer's actual damages are less than the amount withheld from the Holdback Amount, Buyer shall promptly pay such excess to Seller.


[Signature page follows]
 
 
 
 
 
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date first above written.
 
 
Seller:
 
     
 
DRITTE SCHROEDER CONTAINER
BETEILIGUNGSGESELLSCHAFT MBH & CO KG
 
       
 
By:
/s/ Jürgen Rahn
 
  Name:
Jürgen Rahn
 
  Title:
Managing Director
 
 
 
Buyer:
 
     
 
CONTAINER APPLICATIONS LIMITED
 
       
 
By:
Carolyn Attong
 
  Name:
Carolyn Attong
 
  Title:
Chief Executive Officer
 
 
 
 
 
EXHIBIT A


LIST OF PURCHASED CONTAINERS
 
 
 
 
 
EXHIBIT B

BILL OF SALE
 
For valuable consideration, the receipt and sufficiency of which is hereby acknowledged, DRITTE SCHROEDER CONTAINER BETEILIGUNGSGESELLSCHAFT MBH & CO KG, an Austrian company ( “Seller ”) does hereby sell, assign and transfer to CONTAINER APPLICATIONS LIMITED, a company organized and existing under the laws of Barbados ( “Buyer ”), and its successors and assigns, all right, title and interest of Seller in and to the marine cargo containers and related equipment listed on Exhibit A attached hereto (the “ Containers ”) to have and to hold the same unto Buyer, its successors and assigns.  Capitalized terms used herein that are not otherwise defined shall have the meanings given to such terms in the Container Purchase Agreement by and between   Seller and Buyer dated and effective as of October 19, 2012 (the “ Purchase Agreement ”).
 
Seller warrants that it has the right to transfer title to the Containers as provided in the Title Transfer Agreement. On the Closing Date, after giving effect to the payment of the Purchase Price of the Containers as contemplated by the Purchase Agreement, the Reassignment Agreement and the Title Transfer Agreement, Buyer will receive and hold good and marketable title to (i) the Containers free and clear of all Encumbrances originating by, through, or under Seller and all other encumbrances of which Seller may be aware, except for the use and possessory interests of third party lessees as contemplated under the Management Agreement and (ii) the Sellers HSH-Claims.
 
Following receipt in full of the purchase price of the Containers from Buyer, Seller agrees:  (i) at its own cost and expense to defend Buyer’s title to the Containers from any adverse claim of any party claiming any interest in the Containers by, through or under Seller; and (ii) to indemnify Buyer with respect to any losses or damages suffered by Buyer as a result of any defect in title to the Containers as aforesaid.
 
EXCEPT FOR THE WARRANTY OF TITLE AS EXPRESSLY SET FORTH IN THIS BILL OF SALE AND THE REPRESENTATIONS AND WARRANTIES OF SELLER SET FORTH IN THE PURCHASE AGREEMENT, THE EQUIPMENT IS BEING SOLD TO BUYER BY SELLER “AS-IS” “WHERE-IS”, WITHOUT ANY OTHER REPRESENTATIONS AND WARRANTIES, WHETHER WRITTEN, ORAL OR IMPLIED, AND SELLER SHALL NOT, BY VIRTUE OF HAVING SOLD THE EQUIPMENT HEREWITH, BE DEEMED TO HAVE MADE ANY REPRESENTATIONS OR WARRANTY, EXPRESS OR IMPLIED, NOW OR HEREAFTER, AS TO THE CONDITION, DESIGN, OPERATION, MAINTENANCE, VALUE, MARKETABILITY, MERCHANTABILITY, OR FITNESS FOR USE OR FOR A PARTICULAR PURPOSE OF ANY OF THE CONTAINERS OR AS TO THE QUALITY OF THE MATERIAL OR WORKMANSHIP OF ANY OF THE CONTAINERS AND ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, DEALING OR USAGE OR THE TRADE.
 

 
[signature page follows]
 
 
 
 
 
IN WITNESS WHEREOF, the undersigned has executed this Bill of Sale as of the 19th day of October, 2012.
 
 
Seller:
 
     
 
DRITTE SCHROEDER CONTAINER
BETEILIGUNGSGESELLSCHAFT MBH & CO KG
 
       
 
By:
/s/ Jürgen Rahn
 
  Name:
Jürgen Rahn
 
  Title:
Managing Director
 
 
 
 

EXHIBIT C

Date: October 19, 2012
 
CERTIFICATE OF FINAL ACCEPTANCE AND DELIVERY
 

 
CONTAINER APPLICATIONS LIMITED, a company organized under the laws of Barbados, whose principal place of business is at Suite 102, Bush Hill, Bay Street, St. Michael, Barbados, West Indies (“Purchaser”) and DRITTE SCHROEDER CONTAINER BETEILIGUNGSGESELLSCHAFT MBH & CO KG , a company registered under the laws of Austria (“Seller”) hereby confirm that pursuant to Section 8.02(c) of the Container Purchase Agreement (the "Purchase Agreement") dated and effective October 19, 2012, Seller is deemed to accept receipt of the Purchase Price (as defined in the Purchase Agreement) for the Containers listed on Exhibit A (“Containers”) hereto on the date the funds were duly transferred to the Seller’s account. Purchaser is deemed to accept the delivery from Seller of the Containers which were received on October 19, 2012 in good order and condition.  Such accepted Containers shall be subject to adjustment as contemplated in Section 3(c) of the Purchase Agreement.
 
DRITTE SCHROEDER CONTAINER
BETEILIGUNGSGESELLSCHAFT
MBH & CO KG
CONTAINER APPLICATIONS LIMITED
By:
 
 
By:
 
 
Name:
 
Jürgen Rahn
 
Name:
 
Carolyn Attong
Title:
Managing Director
Title:
Chief Executive Officer
Date:
 
 
Date:
 
 
 
 
 
 
EXHIBIT D
TERMINATION AGREEMENT

THIS TERMINATION AGREEMENT (the “ Termination Agreement ”), is made as of October 19, 2012, by and between DRITTE SCHROEDER CONTAINER BETEILIGUNGSGESELLSCHAFT MBH & CO KG, a company organized and existing under the laws of Austria, whose principal office is located at Karolingerstrasse 36 A-5020 Salzburg, Austria (hereinafter referred to as " Owner "), and CAI International, Inc., a company incorporated under the laws of Delaware, USA, whose principal office is located at Steuart Tower, 1 Market Plaza, Suite 900, San Francisco, CA 94105, USA, successor in interest to Container Applications International, Inc. (" Manager "). Owner and Manager shall hereinafter be referred to individually as a " Party " and jointly as the " Parties ".
 
W I T N E S S E T H:
 
WHEREAS, Container Applications Limited (“CAL” ) and Owner have entered into that certain Container Purchase Agreement (the “ Purchase Agreement ”) dated October 19, 2012 whereby CAL shall purchase certain marine cargo shipping containers as more particularly described therein (the “ Containers ”);
 
WHEREAS, Manager manages the Containers pursuant to that certain Amended and Restated Container Management Services Agreement dated as of June 28, 2006 between Manager and Owner (the “ Management Agreement ”);
 
WHEREAS, the Containers represent Owner‘s entire fleet subject to the Management Agreement on the date hereof and therefore the Parties wish to terminate the Management Agreement with respect to the Containers pursuant to the terms set forth hereunder, as a result of the purchase of the Containers by CAL;
 
WHEREAS, capitalized terms used herein that are not otherwise defined shall have the meanings given to such terms in the Purchase Agreement;
 
NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, the Parties hereto agree as follows:
 
1.             Termination of the Management Agreement.
 
Effective as of this date, the Management Agreement  is hereby terminated with respect to the Containers. Notwithstanding such termination, except as set forth in the Purchase Agreement (including Section 3.02 thereof) all rights and liabilities related to the Containers that have accrued under the Management Agreement prior to this date shall survive this Termination Agreement. Each of the Parties, on behalf of itself and its respective officers, directors, shareholders, employees, agents, representatives, affiliates, predecessors, successors and assigns hereby releases the other Parties and its past, present and future officers, directors, shareholders, employees, agents, representatives, affiliates, predecessors, successors and assigns, and each of them, to and from any and all past or future claims, demands, causes of action of any kind, including claims for attorneys’ fees or costs, whether known or unknown, suspected or claimed, disclosed or undisclosed, matured or unmatured which each Party ever had, now has, or which may hereafter accrue or otherwise be acquired that arises from or are related in any way to the Management Agreement and all matters ancillary thereto, to the extent they relate to the Containers.
 
 
[signature page follows]
 
 
 
 
 
IN WITNESS WHEREOF, the Parties hereto have executed this Termination Agreement as of the day and year first above written.
 
 
DRITTE SCHROEDER CONTAINER
BETEILIGUNGSGESELLSCHAFT MBH & CO KG
 
       
 
By:
   
  Name:
Jürgen Rahn
 
  Title:
Managing Director
 
 
CAI INTERNATIONAL, INC.
 
       
 
By:
 
 
  Name: Timothy B. Page  
  Title:
Chief Financial Officer
 
 
EXHIBIT 99.5
 
CONTAINER PURCHASE AGREEMENT
 
Dated as of October 19, 2012
 
By and between

CONTAINER APPLICATIONS LIMITED,
a Barbados company
 
and

SCHROEDER LEASING GMBH & CO. KG,
A German Company

 
 
 

CONTAINER PURCHASE AGREEMENT
 
This CONTAINER PURCHASE AGREEMENT (the “ Agreement ”) is entered into as of October 19, 2012, by and between CONTAINER APPLICATIONS LIMITED, a company organized and existing under the laws of Barbados ( “Buyer ”), and SCHROEDER LEASING GMBH & CO. KG, a company organized and existing under the laws of Germany (“ Seller ”).
 
Recitals
 
A.            Seller is the lawful owner (as described hereinafter) of the Containers (as defined in Section 1 below) and wishes to sell the Containers to Buyer, and Buyer wishes to purchase the Containers from Seller, all upon and subject to the terms and conditions of this Agreement.
 
B.             Pursuant to that certain Amended and Restated Container Management Services Agreement dated as of June 28, 2006 (the “Management Agreement”), by and between the Seller and the Manager (defined in Section 1 below), the Manager manages the Containers.
 
C.             Buyer is a wholly owned subsidiary of the Manager.
 
D.            The Containers are either under lease by one or more third party container lessees under equipment leases arranged on behalf of the Seller by the Manager or one of its affiliates (the “Leases”) or off lease, in accordance with the terms of the Management Agreement.
 
E.             In connection with the sale of the Containers, the Manager and the Seller wish to terminate the Management Agreement, as a result of the purchase of the Containers by Buyer.
 
F.             The Seller has appointed its exclusive Agent Calbina Group Limited (“Calbina”) to arrange this transaction between the Seller and Buyer. Under the agreement between Seller and Calbina, Calbina is entitled to 3.0% (three percent) of the total Purchase Price as its agreed resale fee (the “Resale Fee”). The Resale Fee is included in the total Purchase Price and shall be paid exclusively by Seller in accordance with the payment instructions set forth in Sections 3.01(a) and (b) of this Agreement.
 
NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations and warranties herein contained, Seller and Buyer agree as follows:
 
1.               Definitions . All capitalized terms used herein and not defined herein have the meanings ascribed to such terms in the Management Agreement. For all purposes of this Agreement, the following terms shall have the following meanings:
 
“ Bill of Sale ” means a bill of sale substantially in the form attached hereto as Exhibit B.
 
“ Business Day ” means any day except a Saturday, Sunday, or other day on which banks in New York are authorized by law to close.

 
 
 
 
“ Certificate of Final Acceptance and Delivery ” means a certificate of acceptance and delivery substantially in the form attached hereto as Exhibit C.
 
“ Closing ” means the closing of the sale and purchase of the Containers contemplated by this Agreement.
 
“ Closing Date ” means the date on which the Closing shall occur as fixed pursuant to Section 4.
 
“ Containers “ means (a) the marine cargo shipping containers listed in Exhibit A hereto, and all of the Seller’s interest in such containers; (b) all of Seller’s right, title, and interest in and to and claims as well as obligations under the Leases; and (c) all of Seller's right, title and interest in and to any purchase agreement pursuant to which the Seller acquired any of the Containers and in and to warranties by the manufacturers or original sellers of the Containers. The Containers are owned as described in Clause A of the Recitals.
 
“ Cut-Off Date “ means July 31, 2012.
 
“ Effective Date ” means October 19, 2012.
 
“ Encumbrance ” means any charge, mortgage, lien, pledge, claim, restriction, security interest or other encumbrance whether created or arising by agreement, statute or otherwise at law, attaching to property, interest or rights and shall be construed in the widest possible terms and principles known under the law applicable to such property, interests or rights and whether or not they constitute a security interest as that term is understood under the laws of the State of California, U.S.A.
 
“ Manager ” means CAI International, Inc., a corporation organized and existing under the laws of Delaware, successor in interest to Container Applications International, Inc.
 
“ Purchase Price ” means the Purchase Price per unit price per Container for this Agreement to be purchased by Buyer as indicated hereunder. Purchase Price means an all inclusive total price, with respect to a Container. The total Purchase Price is the total dollar amount that Buyer must pay to Sellers Account to acquire title to all the Containers under this Agreement free and clear of Encumbrances.
 
   
Price per Unit
   
Quantity
   
Purchase Price
 
20' Containers
                 
Units
  $ 1,400       227     $ 317,800  
                         
40' Containers
                       
Units
  $ 2,240       86     $ 192,640  
                         
40' HC Containers
                       
Units
  $ 2,352       260     $ 611,520  
                         
Total
            573     $ 1,121, 960  

 
 
 
 
“Sellers Account” means the bank account into which funds are to be wired pursuant to Section 3.01(a) of this Agreement, which account is as follows:
 
Account holder:
Schroeder Leasing GmbH & Co. KG
   
Bank:
HSH Nordbank AG, Gerhard-Hauptmann-Platz 50, 20095 Hamburg
   
Account Number:
1100146250
   
Swift Code:
HSHNDEHH
   
IBAN:
DE 41 21050000 1100146250
 
 “ Termination Agreement ” means that certain Termination Agreement to the Management Agreement in substantially the form attached hereto as Exhibit D.
 
“ Transaction Documents ” means this Agreement, the Bill of Sale, the Certificate of Acceptance and Delivery and the Termination Agreement.
 
2.              Sale and Purchase of the Containers .  On the Closing Date, for the consideration provided in Section 3 and subject to the terms and conditions set forth herein, (i) Seller shall sell to Buyer the Containers and (ii) shall assign, transfer and convey to Buyer all of its right, title, and interest relating to the Containers from and after the Closing Date; and (iii) Buyer shall purchase the Containers from the Seller and accepts aforesaid assignment, transfer and conveyance.
 
To the extent any third party has or acquires immediate possession of the Containers, the Seller from and after the Closing Date assigns to the accepting Buyer any and all of its claims for (re-)delivery of the Containers and acknowledges that after giving effect to this Agreement, Buyer will own the Containers and all future claims for (re-)delivery of the Containers. Seller is not aware of any existing claims by any parties that may assert liens or other encumbrances of title that would be inconsistent with the clean title to be transferred pursuant to this Agreement.
 
3.               Consideration; Adjustment to Purchase Price; Revenue Allocations.
 
3.01 Consideration; Adjustment to Purchase Price:

 
 
 
 
(a)           In consideration for the sale of the Containers as contemplated in Section 2, the Purchase Price shall be paid by Buyer to the Seller by wire transfer of immediately available funds, as follows:

 
(i)
On the Closing Date, Buyer shall pay to Seller 95% of the Purchase Price, of which One Million Thirty-Three Thousand Eight Hundred Eighty-Six Dollars and Fourteen Cents (US$1,033,886.14) to be deposited in the Seller’s Account and Thirty-One Thousand Nine Hundred Seventy-Five Dollars and Eighty-Six Cents (US$31,975.86) to be deposited in Calbina’s bank account to be informed by Calbina, pursuant to Seller’s instructions; and;
 
 
(ii)
On December 15, 2012, Buyer shall pay to Seller 5% of the Purchase Price (the “Second Payment”), of which Fifty-Four Thousand Four Hundred Fifteen Dollars and Six Cents (US$54,415.06) (the “Hold Back”) to be deposited in Seller’s Account and One Thousand Six Hundred Eighty-Two Dollars and Ninety-Four Cents (US$1,682.94) to be deposited in Calbina’s bank account to be informed by Calbina, pursuant to Seller’s instructions.
 
(b)           Seller hereby acknowledges that once the deposits under Sections 3.01(a)(i) and (ii) above are made by Buyer (or in the case of the Hold Back, applied as permitted in this Agreement), the full Purchase Price shall have been paid by Buyer to Seller and that the Resale Fee shall be borne exclusively by Seller.
 
(c)           The parties acknowledge that the aggregate Purchase Price to be paid pursuant to Section 3.01(a) above shall be based on Manager’s then best estimate of the number of Containers existing as of the Effective Date. On or before December 15, 2012 (the “Settlement Date”), Buyer shall provide the Seller with:  (i) the actual number of Containers existing as of the Effective Date along with such supporting documentation as the Seller may reasonably request; and (ii) an accounting of bad debt reserves that had been established by Manager pursuant to the Management Agreement. The amount of such bad debt reserves, if any, that were not applied under the Management Agreement shall be added to the Hold Back and if the actual bad debts under the Management Agreement exceed the amount of such bad debt reserves, the amount of such excess shall be applied to such bad debts and subtracted from the Hold Back.  In the event that the aggregate actual number of Containers as of the Effective Date is less than the aggregate number of Containers identified in the Bill of Sale delivered by the Seller at the Closing, then the Buyer shall be entitled to offset the Purchase Price of the Containers not delivered on the Closing Date against the Hold Back, and if the respective Purchase Price for such Containers that are not delivered exceeds the Hold-Back, then Seller shall no later than five (5) Business Days following written notice, pay to Buyer by wire transfer the amount by which the aggregate Purchase Price of all Containers not delivered on the Closing Date exceeds the amount of the Hold Back that was offset against the Purchase Price of such Containers that were not delivered.  In the event that the aggregate actual number of Containers as of the Effective Date is greater than the aggregate number of Containers identified in the Bill of Sale delivered by the Seller at the Closing, Buyer shall, against receipt of a Bill of Sale for such additional Containers, pay Seller the respective Purchase Price by wire transfer of immediately available funds for each Container not delivered by Seller at the Closing.

 
 
 
 
3.02 Allocation of Revenues.
 
(a)            The parties acknowledge that all NOI accrued for all periods on or prior to the Cut-Off Date with respect to the Containers shall be for the account of and belong to the Seller and shall be paid to Seller pursuant to the Management Agreement. All Gross Revenues accrued for all periods commencing after the Cut-Off Date with respect to the Containers shall be for the account of and belong to Buyer.
 
4.              Closing .   The Closing shall take place at the offices of Buyer not later than October 19, 2012, or at such other date, time and place as Seller and Buyer shall mutually agree. Immediately upon the Closing, Seller shall be deemed to have delivered the Containers to Buyer and Buyer shall be deemed to have accepted the Containers from the Seller without any further action on the part of Buyer or Seller.
 
5.              Representations and Warranties of Seller .  Seller represents and warrants to Buyer as of the date hereof, as follows:
 
5.01 Existence, Power and Authority . Seller is a company, duly organized and validly existing under the laws of Germany, and has all requisite corporate authority to enter into the Transaction Documents, and to consummate the transactions contemplated hereby and thereby.
 
5.02 Authorization . The execution and delivery of the Transaction Documents by the Seller, and the performance by Seller hereunder and thereunder, have been duly authorized by all requisite corporate action and proceedings of Seller.
 
5.03 No Conflict . Neither the execution and delivery of the Transaction Documents by Seller, nor the performance by it hereunder or thereunder, will (i) violate, conflict with or constitute a default under any provision of its charter documents, (ii) conflict with or result in a breach of any indenture or other agreement to which Seller is a party, (iii) violate any judgment, order, injunction, decree or award of any court, administrative agency or governmental body against Seller, or (iv) constitute a violation by Seller of any law or regulation known by Seller to be applicable to Seller, except in any case where such violation would not have a material adverse effect on the financial condition of Seller or its ability to perform its obligations under this Agreement.
 
5.04 Consents . The execution, delivery and performance by Seller of, and the consummation of the transactions contemplated by the Transaction Documents do not require (i) any approval or notice to or consent of any person, which has not been obtained already, or (ii) any notice to or filing or recording with, or any consent or approval of, any governmental body.
 
5.05 Legal Proceedings . There are no actions, suits or proceedings pending, or to the knowledge of Seller, threatened, against Seller before any court, arbitrator, administrative or governmental body that, if adversely determined, would hinder or prevent Seller’s ability to carry out the transactions contemplated by the Transaction Documents, or affect the right, title or interest of Seller in its Containers, and, to its knowledge, there is no basis for any such suits or proceedings.

 
 
 
 
5.06 Title . Seller is the lawful and rightful sole owner of the Containers and has good right and title to sell the Containers to Buyer as described in Clause A of the Recitals. On the Closing Date, after giving effect to the payment of the Purchase Price of the Containers as contemplated by this Agreement, Buyer will receive and hold good and marketable title to  the Containers free and clear of all Encumbrances originating by, through, or under Seller and all other encumbrances of which Seller may be aware, except for the use and possessory interests of third party lessees as contemplated under the Management Agreement.
 
5.07 Compliance with Laws and Regulations . To the knowledge of Seller, the sale of the Containers by Seller will not violate any provision of any applicable laws, orders or regulations.
 
6.              Representations and Warranties of Buyer .  Buyer represents and warrants to Seller as of the date hereof, as follows:
 
6.01 Corporate Existence, Power and Authority . Buyer is a company duly formed and validly existing under the laws of Barbados, and has the corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby.
 
6.02 Authorization . The execution and delivery by Buyer of this Agreement, and the performance by Buyer hereunder, have been duly authorized by all requisite corporate action and proceedings of Buyer and Buyer shall have provided Seller with a copy of the resolutions of Buyer's Board of Directors authorizing such execution, delivery and performance.
 
6.03 No Conflict . Neither the execution and delivery of this Agreement by Buyer, nor the performance by Buyer hereunder, will (i) violate, conflict with or constitute a default under any provision of Buyer’s Articles of Association or Bylaws, (ii) conflict with or result in a breach of any indenture or other agreement to which Buyer is a party, (iii) violate any judgment, order, injunction, decree or award of any court, administrative agency or governmental body against Buyer, or (iv) constitute a violation by Buyer of any law or regulation known by Buyer to be applicable to Buyer, except in any case where such violation would not have a material adverse effect on the financial condition of Buyer or its ability to perform its obligations under this Agreement.
 
6.04 Consents . The execution, delivery and performance by Buyer of this Agreement do not require (i) the approval or consent of or notice to any person, or (ii) any notice to or filing or recording with, or any consent or approval of, any governmental body.
 
6.05 Legal Proceedings . There are no actions, suits or proceedings pending, or to the knowledge of Buyer, threatened, against Buyer that, if adversely determined, would materially hinder or prevent Buyer’s ability to carry out the transactions contemplated by this Agreement, and, to Buyer’s knowledge, there is no basis for any such suits or proceedings.

 
 
 
 
6.06 Compliance with Laws and Regulations . To the knowledge of Buyer, the purchase of the Containers by Buyer will not violate any applicable laws, orders or regulations.
 
7.              Covenant related to Closing . Each of the parties shall use all reasonable efforts to fulfill or obtain the fulfillment of conditions set forth herein as they relate to such party on or prior to the Closing.
 
8.              Conditions Precedent to the Obligation of Buyer to Close . The obligation of Buyer to purchase the Containers pursuant to this Agreement is subject to the fulfillment on or prior to the Closing of the following conditions, any one or more of which may be waived by it:
 
8.01 Representations, Warranties and Covenants . The representations and warranties of Seller contained in this Agreement shall be true in all material respects on and as of the Closing with the same force and effect as though made on and as of such Closing. Seller shall have performed and complied with all covenants and agreements required by this Agreement and the Management Agreement to be performed or complied with by it on or prior to the Closing.
 
8.02 Delivery of Documents . The following documents shall have been delivered to Buyer on the Closing Date at the latest:
 
(a)           a Bill of Sale executed by Seller;
 
(b)           the Termination Agreement executed by Seller;
 
(c)           the Certificate of Final Acceptance and Delivery executed by Seller;
 
(d)           all other agreements, instruments, certificates and other documents reasonably requested by Buyer prior to the Closing Date to effect the transactions contemplated by this Agreement, including without limitation, termination statements and such other documents as may be necessary to terminate all liens of record encumbering the Containers;
 
(e)           a copy of the resolutions of the Managing Director of the General Partner of the Seller approving and authorizing the execution and implementation by the Seller of the Transaction Documents;
 
(f)           a favorable legal opinion addressed to the Buyer, dated as of the Closing Date, in form and substance satisfactory to Buyer from Huth Dietrich Hahn Partnerschaftsgesellschaft, counsel to Seller; and
 
(g)           a certificate of the Managing Director of the general partner of Seller to the effect that:  (i) he is familiar with the operations of Seller; and (ii) he is not aware of any liens, claims or encumbrances (whether or not originating by, through or under Seller) that encumber the Containers, other than use and possessory interests of third party lessees as contemplated under the Management Agreement.
 
8.03 Consents . Any required consent or approval of any other third person to the sale and transfer of the Containers to Buyer shall have been obtained, and Buyer shall have received evidence satisfactory to it of the same.

 
 
 
 
8.04 Satisfaction of Statutory and Regulatory Requirements . All statutory and other legal requirements for the valid consummation of the transactions contemplated by this Agreement shall have been fulfilled.
 
9.              Conditions Precedent to the Obligation of Seller to Close . The obligation of Seller to sell the Containers pursuant to this Agreement is subject to the fulfillment on or prior to the Closing of the following conditions, any one or more of which may be waived by it:
 
9.01 Representations, Warranties and Covenants . The representations and warranties of Buyer contained in the Agreement shall be true in all material respects on and as of the Closing with the same force and effect as though made on and as of such Closing. Buyer shall have performed and complied with all covenants and agreements required by this Agreement to be performed or complied with by it on or prior to the Closing.
 
9.02 Delivery of Funds and Documents . The Purchase Price required by Section 3.01(a)(i) shall have been duly delivered to Seller Account; and Buyer shall have duly executed and delivered to Seller all other agreements, instruments, certificates and other documents reasonably requested by Seller prior to the Closing Date to effect the transactions contemplated by this Agreement.
 
9.03 Satisfaction of Statutory and Regulatory Requirements . All statutory and other legal requirements for the valid consummation of the transactions contemplated by the Agreement shall have been fulfilled.
 
10.            Disclaimer of Warranties by Seller . EXCEPT FOR THE WARRANTY OF TITLE AS EXPRESSLY SET FORTH IN THE BILL OF SALE, AND THE REPRESENTATIONS AND WARRANTIES OF SELLER SET FORTH HEREIN, THE EQUIPMENT IS BEING SOLD TO BUYER BY SELLER “AS-IS” “WHERE­IS”, WITHOUT ANY OTHER REPRESENTATIONS AND WARRANTIES, WHETHER WRITTEN, ORAL, OR IMPLIED, AND SELLER SHALL NOT BY VIRTUE OF HAVING SOLD THE EQUIPMENT HEREWITH, BE DEEMED TO HAVE MADE ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, NOW OR HEREAFTER, AS TO THE CONDITION, DESIGN, OPERATION, MAINTENANCE, VALUE, MARKETABILITY, MERCHANTABILITY OR FITNESS FOR USE OR FOR A PARTICULAR PURPOSE OF ANY OF THE CONTAINERS OR AS TO THE QUALITY OF THE MATERIAL OR WORKMANSHIP OF ANY OF THE CONTAINERS AND ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, DEALING OR USAGE OF THE TRADE. Except as expressly set forth herein, Seller disclaims any liability to Buyer with respect to the Containers’ condition, including, without limitation, any liability in tort or arising from negligence, strict liability or for loss or interruption of use, profit or business or other consequential injury, and Buyer waives, releases, renounces and disclaims expectation of or reliance upon any such warranty or warranties.
 
11.            Survival of Representations and Warranties . All representations and warranties made herein, and the agreements set forth herein, shall survive the Closing.

 
 
 
 
12.            Further Assurances . Seller and Buyer agrees to execute, acknowledge, deliver, file and record, or cause to be executed, acknowledged, delivered, filed and recorded, such further documents or other papers, and to do all such things and acts, as the other parties may reasonably request in order to carry out the provisions and purposes of this Agreement and the transactions contemplated hereby. Seller shall send Buyer, upon its receipt thereof, all payments, notices, communications and any other documents with respect to the Containers which it receives subsequent to the Closing Date.
 
13.            Expenses and Sales Tax . Each party shall bear its expenses incurred in connection with the preparation, execution and performance of this Agreement and the transactions contemplated hereby, including, without limitation, all fees and expenses of its agents, representatives, counsel and accountants. Seller shall bear all costs associated with filing and recording the termination statements, assignments, releases and terminations described in Section 8.02 of this Agreement. It is the expectation of the parties that the transfer contemplated by this Agreement shall be exempt from state and local sales, use, transfer or similar taxes (“ Sales Tax ”).
 
14.            Brokers’ Fees . Except for the fees due by Seller to Calbina, Seller, on the one hand, and Buyer, on the other, represents and warrants to the other that neither it nor any of its affiliates have incurred any obligation or liability, directly or indirectly, for brokerage or finders’ fees or agents’ commissions or like payment in connection with this Agreement or the transactions contemplated hereby, and hereby indemnifies and each holds the other harmless therefor.
 
15.            Notices . Any notice, demand, or communication required or permitted to be given by any provision of this Agreement shall be in writing or transmitted electronically and shall be deemed to have been duly given when received, if personally delivered; upon confirmation of receipt (by use of “confirmation to sender” or other means), if transmitted by telecopy or by electronic or digital transmission method; or on the next business day after it is sent, if sent for overnight delivery by a recognized overnight delivery service, charges prepaid, addressed as follows:

If to Buyer, to:
 
 
Container Applications Limited
 
Suite 102, Corporate Centre
 
Bush Hill, Bay Street
 
St, Michael
 
Barbados, West Indies
  Attention:         CEO and CFO
  Fax Number – 1-246-430-5312

With a copy to:
CAI International, Inc.
 
Steuart Tower
 
1 Market Plaza, Suite 900
 
San Francisco, California 94105
 
  Attention: CEO and CFO
  Telephone: (415) 788-0100
  Fax: (415) 788-3430

 
 
 
 
If to Seller, to:
Schroeder Leasing GmbH & Co. KG
 
Große Elbstrasse 45
 
22676 Hamburg, Germany
 
Attn: Jürgen Rahn, Managing Director
 
Via email: Juergen.Rahn@scs-bv.at

Any party by notice given in accordance with this Section to the other parties may designate another address or person for receipt of notices hereunder.
 
16.            Waivers and Amendments; Non-Contractual Remedies; Preservation of Remedies . This Agreement may be amended, superseded, modified, supplemented or terminated, and the terms hereof may be waived, only by written instrument signed by the parties or, in the case of a waiver, by the party waiving compliance. No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof. No waiver on the part of any party of any such right, power or privilege, nor any single or partial exercise of any such right, power or privilege, shall preclude any further exercise thereof or the exercise of any other such right, power or privilege. The rights and remedies herein provided are cumulative and are not exclusive of any rights or remedies that any party may otherwise have at law or in equity.
 
17.            Governing Law . This Agreement will be governed by and construed under the laws of the State of California.
 
18.            Binding Effect; Assignment . No party shall assign this Agreement to any other person without the prior written consent of all other parties. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. No assignment of this Agreement or of any rights hereunder shall relieve the assigning party of any of its obligations or liabilities hereunder. The Transaction Documents, and the certificates, schedules, annexes and other documents executed and delivered at or before the Closing in connection therewith are the complete agreement of the parties regarding the subject matter hereof and thereof and supersede all prior understandings (written or oral), communications and agreements.
 
19.            Counterparts . This Agreement may be executed by the parties in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument.
 
20.            Severability . Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be effective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement, and the remainder of such provision and the remaining provisions of this Agreement shall be interpreted, to the maximum extent possible, so as to conform to the original intent of this Agreement.

 
 
 
 
21.            Indemnities.
 
(a)           Buyer will indemnify and hold Seller harmless from any liability, loss, cost or expense (“ Claim ”), including reasonable attorneys’ fees, which shall result from (i) a material breach of any representation or warranty of Buyer contained in this Agreement or in any other agreement, instrument, certificate or other document delivered by Buyer pursuant hereto; or (ii) a material breach by Buyer of any of its covenants or agreements contained in this Agreement, any other agreement, instrument, certificate or other document delivered by Buyer in connection with the transactions contemplated by this Agreement. Upon payment of such indemnity, Buyer shall be subrogated to the indemnitee’s rights against any third parties respecting the Claims. Anything contained in this Agreement to the contrary notwithstanding, Buyer shall not be required to indemnify Seller if and to the extent Seller is indemnified and fully compensated for its Claim by a third party.
 
(b)           Seller will, indemnify and hold Buyer harmless from any Claim, including reasonable attorneys’ fees, which shall result from (i) a material breach of any representation or warranty of Seller contained in this Agreement or in any certificate or other document delivered by Seller pursuant hereto; or (ii) a material breach by Seller of any of its covenants or agreements contained in this Agreement, any other agreement, instrument, certificate or other document delivered by Seller in connection with the transactions contemplated by this Agreement. Upon payment of such indemnity, Seller shall be subrogated to Buyer’s rights against any third parties respecting the Claims.

 
 
 
 
(c)           A party seeking indemnification pursuant to Sections 21(a) or (b) above (an “ Indemnified Party ”)   shall give prompt notice to the party from whom such indemnification is sought (the “ Indemnifying Party ”) of the assertion of any Claim, or the commencement of any action, suit or proceeding, in respect of which indemnification may be sought hereunder and will give the Indemnifying Party such information with respect thereto as the Indemnifying Party may reasonably request; but no failure to give such notice shall relieve the Indemnifying Party of any liability hereunder (except to the extent the Indemnifying Party has suffered actual prejudice thereby). The Indemnifying Party may, at its expense, participate in or assume the defense of any such action, suit or proceeding involving a third party; provided, however, that such defense is conducted with counsel mutually satisfactory to the Indemnified Party and the Indemnifying Party. The Indemnified Party and the Indemnifying Party shall consult with each other regarding the conduct of such defense. The Indemnified Party shall have the right (but not the duty) to participate in the defense thereof, and to employ counsel, at its own expense (except that the Indemnifying Party shall pay the fees and expenses of such counsel to the extent the Indemnified Party reasonably concludes that there is a conflict of interest between the Indemnified Party and the Indemnifying Party), separate from counsel employed by the Indemnifying Party in any such action. The Indemnifying Party shall be liable for the fees and expenses of counsel employed by the Indemnified Party if the Indemnifying Party has not assumed the defense thereof. Whether or not the Indemnifying Party chooses to defend or prosecute any Claim involving a third party, all the parties hereto shall cooperate in the defense or prosecution thereof and shall furnish such records, information and testimony, and attend at such conferences, discovery proceedings, hearings, trials and appeals, as may be reasonably requested in connection therewith. The Indemnifying Party shall not be liable under Sections 21(a) or 21(b) for any settlement effected without its written consent (as contemplated above) for any Claim, litigation or proceeding in respect of which indemnity may be sought hereunder. No Claim for indemnification, except Claims based on (i) a breach of the representations contained in Section 5.06 hereof, may be first initiated or asserted by any Indemnified Party against any Indemnifying Party after the second anniversary of the Closing Date.  In the event of any claim for indemnity hereunder by Buyer that occurs prior to the date on which the Hold Back amount is due, Buyer may withhold from the payment of the Hold Back amount an amount equal to Buyer's good faith estimate of damages.  At such time as the claim for indemnity is resolved, if Buyer's actual damages are less than the amount withheld from the Hold Back amount, Buyer shall promptly pay such excess to Seller.

[Signature page follows]

 
 
 
 
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date first above written.
 
 
Seller:
 
     
 
SCHROEDER LEASING GMBH & CO. KG
 
       
 
By:
/s/ Jürgen Rahn
 
  Name:
Jürgen Rahn
 
  Title:
Managing Director of Schroeder Leasing Verwaltungsgesellschaft mbH
 
 
Buyer:
 
     
 
CONTAINER APPLICATIONS LIMITED
 
       
 
By:
Carolyn Attong
 
  Name:
Carolyn Attong
 
  Title:
Chief Executive Officer
 
[Signature Page to Schroeder Leasing Container Purchase Agreement]

 
 
 

EXHIBIT A
LIST OF PURCHASED CONTAINERS

 
 
 

EXHIBIT B

BILL OF SALE
 
For valuable consideration, the receipt and sufficiency of which is hereby acknowledged, SCHROEDER LEASING GMBH & CO. KG, a German company ( “Seller ”) does hereby sell, assign and transfer to CONTAINER APPLICATIONS LIMITED, a company organized and existing under the laws of Barbados ( “Buyer ”), and its successors and assigns, all right, title and interest of Seller in and to the marine cargo containers and related equipment listed on Exhibit A attached hereto (the “ Containers ”) to have and to hold the same unto Buyer, its successors and assigns.  Capitalized terms used herein that are not otherwise defined shall have the meanings given to such terms in the Container Purchase Agreement by and between   Seller and Buyer dated and effective as of October 19, 2012 (the “ Purchase Agreement ”).
 
Seller warrants that it is the lawful and rightful sole owner of the Containers and has good right and title to sell the Containers to Buyer. On the Closing Date, after giving effect to the payment of the Purchase Price of the Containers as contemplated by the Purchase Agreement, Buyer will receive and hold good and marketable title to the Containers free and clear of all Encumbrances originating by, through, or under Seller and all other encumbrances of which Seller may be aware, except for the use and possessory interests of third party lessees as contemplated under the Management Agreement.
 
Following receipt in full of the purchase price of the Containers from Buyer, Seller agrees:  (i) at its own cost and expense to defend Buyer’s title to the Containers from any adverse claim of any party claiming any interest in the Containers by, through or under Seller; and (ii) to indemnify Buyer with respect to any losses or damages suffered by Buyer as a result of any defect in title to the Containers as aforesaid.
 
EXCEPT FOR THE WARRANTY OF TITLE AS EXPRESSLY SET FORTH IN THIS BILL OF SALE AND THE REPRESENTATIONS AND WARRANTIES OF SELLER SET FORTH IN THE PURCHASE AGREEMENT, THE EQUIPMENT IS BEING SOLD TO BUYER BY SELLER “AS-IS” “WHERE-IS”, WITHOUT ANY OTHER REPRESENTATIONS AND WARRANTIES, WHETHER WRITTEN, ORAL OR IMPLIED, AND SELLER SHALL NOT, BY VIRTUE OF HAVING SOLD THE EQUIPMENT HEREWITH, BE DEEMED TO HAVE MADE ANY REPRESENTATIONS OR WARRANTY, EXPRESS OR IMPLIED, NOW OR HEREAFTER, AS TO THE CONDITION, DESIGN, OPERATION, MAINTENANCE, VALUE, MARKETABILITY, MERCHANTABILITY, OR FITNESS FOR USE OR FOR A PARTICULAR PURPOSE OF ANY OF THE CONTAINERS OR AS TO THE QUALITY OF THE MATERIAL OR WORKMANSHIP OF ANY OF THE CONTAINERS AND ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, DEALING OR USAGE OR THE TRADE.
 
[signature page follows]

 
 
 
 
IN WITNESS WHEREOF, the undersigned has executed this Bill of Sale as of the 19th day of October, 2012.
 
 
Seller:
 
     
 
SCHROEDER LEASING GMBH & CO. KG
 
       
 
By:
   
  Name:
Jürgen Rahn
 
  Title:
Managing Director of Schroeder Leasing Verwaltungsgesellschaft mbH
 
 
 
 
 
EXHIBIT C
 
CERTIFICATE OF FINAL ACCEPTANCE AND DELIVERY
 
CONTAINER APPLICATIONS LIMITED, a company organized under the laws of Barbados, whose principal place of business is at Suite 102, Bush Hill, Bay Street, St. Michael, Barbados, West Indies (“Purchaser”) and SCHROEDER LEASING GMBH & CO. KG, a company registered under the laws of Germany (“Seller”) hereby confirm that pursuant to Section 8.02(c) of the Container Purchase Agreement (the "Purchase Agreement") dated and effective October 19, 2012, Seller is deemed to accept receipt of the Purchase Price (as defined in the Purchase Agreement) for the Containers listed on Exhibit A (“Containers”) hereto on the date the funds were duly transferred to the Seller’s account. Purchaser is deemed to accept the delivery from Seller of the Containers which were received on October 19, 2012 in good order and condition.  Such accepted Containers shall be subject to adjustment as contemplated in Section 3(c) of the Purchase Agreement.
 
SCHROEDER LEASING GMBH & CO. KG
 
CONTAINER APPLICATIONS LIMITED
         
By:
   
By:
 
         
Name:
Jürgen Rahn
 
Name:
Carolyn Attong
Title:
Managing Director of Schroeder Leasing Verwaltungsgesellschaft mbH
 
Title:
Chief Executive Officer
Date:
   
Date:
 

 
 
 

EXHIBIT D
 
TERMINATION AGREEMENT

THIS TERMINATION AGREEMENT (the “ Termination Agreement ”), is made as of October 19, 2012, by and between DRITTE SCHROEDER CONTAINER BETEILIGUNGSGESELLSCHAFT MBH & CO KG, a company organized and existing under the laws of Austria, whose principal office is located at Karolingerstrasse 36 A-5020 Salzburg, Austria (hereinafter referred to as " Owner "), and CAI International, Inc., a company incorporated under the laws of Delaware, USA, whose principal office is located at Steuart Tower, 1 Market Plaza, Suite 900, San Francisco, CA 94105, USA, successor in interest to Container Applications International, Inc. (" Manager "). Owner and Manager shall hereinafter be referred to individually as a " Party " and jointly as the " Parties ".
 
W I T N E S S E T H:
 
WHEREAS, Container Applications Limited (“CAL” ) and Owner have entered into that certain Container Purchase Agreement (the “ Purchase Agreement ”) dated October 19, 2012 whereby CAL shall purchase certain marine cargo shipping containers as more particularly described therein (the “ Containers ”);
 
WHEREAS, Manager manages the Containers pursuant to that certain Amended and Restated Container Management Services Agreement dated as of June 28, 2006 between Manager and Owner (the “ Management Agreement ”);
 
WHEREAS, the Containers represent Owner‘s entire fleet subject to the Management Agreement on the date hereof and therefore the Parties wish to terminate the Management Agreement with respect to the Containers pursuant to the terms set forth hereunder, as a result of the purchase of the Containers by CAL;
 
WHEREAS, capitalized terms used herein that are not otherwise defined shall have the meanings given to such terms in the Purchase Agreement;
 
NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, the Parties hereto agree as follows:
 
1.               Termination of the Management Agreement.
 
Effective as of this date, the Management Agreement  is hereby terminated with respect to the Containers. Notwithstanding such termination, except as set forth in the Purchase Agreement (including Section 3.02 thereof) all rights and liabilities related to the Containers that have accrued under the Management Agreement prior to this date shall survive this Termination Agreement. Each of the Parties, on behalf of itself and its respective officers, directors, shareholders, employees, agents, representatives, affiliates, predecessors, successors and assigns hereby releases the other Parties and its past, present and future officers, directors, shareholders, employees, agents, representatives, affiliates, predecessors, successors and assigns, and each of them, to and from any and all past or future claims, demands, causes of action of any kind, including claims for attorneys’ fees or costs, whether known or unknown, suspected or claimed, disclosed or undisclosed, matured or unmatured which each Party ever had, now has, or which may hereafter accrue or otherwise be acquired that arises from or are related in any way to the Management Agreement and all matters ancillary thereto, to the extent they relate to the Containers.

[signature page follows]

 
 
 
 
IN WITNESS WHEREOF, the Parties hereto have executed this Termination Agreement as of the day and year first above written.

  SCHROEDER LEASING GMBH & CO. KG
       
 
By:
   
 
Name:
Jürgen Rahn
 
 
Title:
Managing Director
 

  CAI INTERNATIONAL, INC.
       
 
By:
   
 
Name:
Timothy B. Page
 
 
Title:
Chief Financial Officer