ITE Management LP, through its fund ITE Rail Fund LP entered into a definitive agreement to acquire American Railcar Industries Inc. (NASDAQ:ARII) (‘ARI') from Icahn Enterprises LP (NasdaqGS:IEP), Dimensional Fund Advisors L.P. and other shareholders for $1.3 billion on October 22, 2018. ITE Management will pay $70 per share as consideration. Each stock appreciation right (‘SAR') will be exchanged for a consideration equal to the excess of $70 over the exercise price per SAR as per the agreement. ITE Management will deposit up to $130 million in escrow in connection with the transaction. The transaction is valued at approximately $1.75 billion including ARI's net indebtedness. ITE Management obtained certain equity financing commitments pursuant to which ITE Rail Fund committed to contribute to an equity contribution equal to $440 million, senior secured first lien term facility of $150 million and secured term loan facility of $770 million. The financing was provided by the OpCo Committed Lenders and the AssetCo Committed Lender under the debt commitment letters. Post completion, American Railcar Industries will no longer be listed on the NASDAQ. As per the agreement, ARI may shop for alternative superior proposals up to November 26, 2018. ARI may be required to pay a fee of $65 million while ITE Management may be required to pay a fee of $130 million in the event of termination of the transaction under certain circumstances.

The transaction is subject to termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, approval by ARI stockholders and twenty days having elapsed since the mailing to the ARI stockholders of a definitive information statement with respect to adoption of the agreement by IEH ARI Holdings LLC, the entity through which Icahn Enterprises holds its stake in ARI and other customary closing conditions. The transaction is not subject to any further due diligence or any financing conditions. ITE Management entered into a voting agreement whereby IEH ARI Holdings and certain of its affiliates agreed to vote their shares in favor of adoption of the agreement, the merger and the other transactions contemplated thereby. The Boards of Directors of ITE Management and ARI have both unanimously approved the agreement. The ARI Board recommends that shareholders adopt the agreement and approve the transaction. As on November 2, 2018, Federal Trade Commission granted an early termination notice of antitrust approval waiting period. The transaction is expected to close in the fourth quarter of 2018.

Stuart Welburn, Corby J. Baumann Sandra Brown, Branwen Buckley, David Benz, David Jaglowski, Andrea McCarthy, Shelbie Harvey, James Koenig and Cathryn Greenwald from Thompson Hine LLP served as legal advisors to ARI and Icahn Enterprises. Western Reserve Partners provided fairness opinion on the transaction to the Board of ARI. James Bedar, Andrew Strehle, Douglas Cohen, Edward Naughton, Adriana Henequen, Tyler Lewis and Kyle Johnson of Brown Rudnick LLP acted as legal advisors to Icahn Enterprises. Rebecca Farrington of White & Case LLP acted as the legal advisor to Icahn Enterprises. William Gump, Bradley Friedman, Jonathan Kubek, Justin Sommerkamp, Josh Deason, David Axelson and Joseph Schemo from Willkie Farr & Gallagher LLP served as legal advisors to ITE Management LP. Berick, Daniel of Squire Patton Boggs (UK) LLP acted as legal advisor to Western Reserve Partners in the transaction. Citibank, N.A. acted as the escrow agent in the transaction. Arnold & Porter advised Credit Suisse as legal advisor to lender.