miscellaneous amendments to title iii

miscellaneous amendments to title iii Sec. 612. (a) Section 303(b) (3) of such Act (45 U.S.C. 743(b) (3)) is amended to read as follows: “(3) (A) (i) Notwithstanding any other provision of this Act, if an interest in railroad rolling stock is included in the rail properties conveyed pursuant to subsection (b) (1) of this section, and if such conveyance is in accordance with the requirements of clause (ii) of this subparagraph, the conveyance of sucn properties shall be deemed an assignment. Any such assignment shall relieve the assignor of liability for any breach which occurs after the date of such conveyance, except that such assignor shall remain liable for any breach, event of default, or violation of covenant which occurred (and any charges or obligations which accrued) prior to the date of such conveyance, regardless of whether the assignee thereof assumes such liabilities, charges or obligations. If any such liabilities, charges, or obligations (accrued prior to the date of such conveyance) are paid by or on behalf of any person or entity other than such assignor, such person or entity shall have a claim to direct reimbursement, as a current expense of administration, from such assignor, together with interest on the amount so paid. “(ii) A conveyance referred to in clause (i) of this subparagraph may be effected only if— “(I) the Corporation or a subsidiary thereof, the profitable railroad operating in the region, or the State or responsible person to whom such conveyance is made assumes all of the obligations under any applicable conditional sale agreement, equipment trust agreement, or lease with respect to such rolling stock (including any obligations which accrued prior to the date on which such properties are conveyed), and “(II) such conveyance is made subject to such obligations. As used in this subparagraph, the term ‘railroad rolling stock’ means assets which could be carried in Interstate Commerce Commission account numbers 52, 53, 54, and 57. “(B) Subject to the provisions of this paragraph, the provisions of this Act snail not affect the title and interests of any lessor, equipment trust trustee, or conditional sale vendor under any conditional sale agreement, equipment trust agreement, or lease under section 77(j) of the Bankruptcy Act (11 U.S.C. 205(j)). A profitable railroad operating in the region, the Corporation or a subsidiary thereof, or a State or responsible person, to whom such a conveyance is made as assignee or as lessee; shall assume all liability under such conditional sale agreement, equipment trust agreement, or lease. Such an assignment or conveyance to, and such an assumption of liability by, 90 STAT. 108such a profitable railroad, Corporation, subsidiary, State, or responsible person shall not be deemed a breach, an event of default, or a violation of any covenant of any such conditional sale agreement, equipment trust agreement, or lease so assigned or conveyed, notwithstanding any provisions of any such agreement or lease.”. (b) Section 201 of the Government Corporation Control Act (31 U.S.C. 856) is amended by (1) inserting “and” after the comma at the end of subsection (7) thereof; and (2) deleting “, and (9) the Consolidated Rail Corporation to the extent provided in the Regional Rail Reorganization Act of 1973.” and inserting in lieu thereof “.”. (c) (1) Section 303(a) (11 of such Act (45 U.S.C. 743(a)(1)) is amended by inserting after “Corporation”, the second time it appears “or any subsidiary thereof”. (2) Paragraphs (1) and (2) of section 303(b) of such Act (45 U.S.C. 743(b) (1) and (2)) are amended by inserting after “Corporation” each time it appears therein (except the first time) “or any subsidiary thereof”. (3) Section 303(c)(1) of such Act (45 U.S.C. 743(c)(1)) is amended by inserting after “Corporation” each time it appears “or any subsidiary thereof”. (4) Paragraph (2) (A) of section 303(c) of such Act (45 U.S.C. 743(c) (2) (A)) is amended by striking “Corporation” the second time it appears and inserting in lieu thereof “Corporation or any subsidiary thereof ”. (d) (1) Section 303(a)(2) of such Act (45 U.S.C. 743(a)(2)) is amended by inserting after “region” the first time it appears “and each State or responsible person (including a government entity)”. (2) Section 303(b)(1) of such Act (45 U.S.C. 743(b)(1)) is amended (A) by inserting immediately after “region” the first place it appears the following: “, States, and responsible persons”, and (B) by striking out “and the respective profitable railroads operating in the region” and inserting in lieu thereof “, the respective profitable railroads operating in the region, States, and responsible persons”. (3) Section 303(b)(2) of such Act (45 U.S.C. 743(b)(2)) is amended by striking out “and the respective profitable railroads operating in the region” and inserting in lieu thereof “, the respective profitable railroads operating in the region, States, and responsible persons”. (4) Paragraph (4) of section 303(b) of such Act (45 U.S.C. 743 (b) (4) J is amended by striking “or the profitable railroad” and inserting in lieu thereof “, profitable railroad, State, or responsible person”. (5) Section 303(c) of such Act (45 U.S.C. 743(c)) is amended by striking “and profitable railroads operating in the region” and inserting in lieu thereof “, profitable railroads operating in the region, States, and responsible persons”. (6) Paragraph (1) (A) (ii) of section 303 (c) of such Act (45U.S.C. 743(c) (1) (A) (ii)) is amended by inserting “State, or responsible person” after “region,”. (7) Paragraph (3) of section 303(c) of such Act (45 U.S.C. 743(c) (3)) is amended by inserting “, State, or responsible person” after “region” and by inserting after “railroad” each time it appears therein (except the first time) “, State, or responsible person”. (8) Paragraph (4) of section 303(c) of such Act (45 U.S.C. 743(c) (4)) is amended by inserting “, States, and responsible persons” after “railroads”. (e) Section 303(c)(2) of such Act (45 U.S.C. 743(c)(2)) is amended by (1) striking out “shall” in the clause preceding subparagraph (A) thereof and inserting “may” in lieu thereof; (2) striking 90 STAT. 109out the semicolon at the end of subparagraph (A) thereof and inserting in lieu thereof “, except that at least one share of series B preferred stock and one certificate of value shall be allocated to each such railroad;”; and (3) amending subparagraph (C) thereof to read as follows: “(C) enter a judgment against the Corporation if the judgment would not endanger the viability or solvency of the Corporation.”. (f) Section 303(c) of such Act (45 U.S.C. 743(c)) is amended by adding at the end thereof the following new paragraph: “(5) Whenever the special court orders, pursuant to section 303(b) (1) of this title, the transfer or conveyance to the Corporation or any subsidiary thereof of rail properties designated under section 206 (c)(1) (C) or (D) of this Act, to the National Railroad Passenger Corporation, to a profitable railroad, or to a State, or responsible person (including a government entity), the United States shall pay any judgment entered against the Corporation with respect to the conveyance of any such rail properties or against the National Railroad Passenger Corporation, such profitable railroad, State, or responsible person, plus interest thereon at such rate as is constitutionally required. The United States may, in its discretion, represent the Corporation or the National Railroad Passenger Corporation, such profitable railroad, State or responsible person, in any proceedings before the special court that could result in such a judgment against the Corporation under paragraph (2) of this subsection or against the National Railroad Passenger Corporation, such profitable railroad, State or responsible person, under paragraph (3) of this subsection. The Corporation, the National Railroad Passenger Corporation, any profitable railroad, State, or responsible person, which is represented by the United States of America shall cooperate diligently in whatever manner the United States shall reasonably request of it in connection with such proceedings. Neither the Corporation, or its subsidiaries, nor the National Railroad Passenger Corporation, any profitable railroad, State or responsible person, shall be obligated to reimburse the United States for any moneys paid by the United States pursuant to this section.”. (g) Section 303(d) of such Act (45 U.S.C. 743(d)) is amended by (1) striking out “5” and inserting in lieu thereof “20”. (h) Section 303(c)(4) of such Act (45 U.S.C. 743(c)(4)) is amended by (1) striking out “subsection (b)” and inserting in lieu thereof “subsection (a)”; and (2) inserting after “region” the following: “and to persons leased, operated, or controlled by such railroads who so transferred or conveyed rail properties”. (i) Section 303 of such Act (45 U.S.C. 743) is amended by (1) adding “, certificates of value” after “securities” in subsection (c)(1) (A) (i) thereof, in the preamble of subsection (c) (2) and in subsection (c)(2) thereof, and in subsection (c)(3) thereof; (2) adding “and certificates of value” after “of the Corporation” in subsection (c) (2) (A) thereof and after “Corporation’s securities” in subsection (c) (2) (B) thereof; (3) striking out “obligations of the Association” each place the phrase appears and inserting in lieu thereof “certificates of value issued by the Association”; and (4) striking out “obligations” each place it appears other than as part of such phrase and inserting in lieu thereof “certificates of value”. (j) (1) Section 301(a) of such Act (45 U.S.C. 741(a)) is amended by inserting immediately after “Corporation” the following: “or such other corporate name as may be duly adopted by the Corporation”. (2) Section 201 (k) of such Act (45 U.S.C. 711 (k)), as redesignated by section 603(a) of this Act, is amended (A) by striking out “these provisions” in the third sentence thereof and inserting in lieu thereof “this provision”; (B) by striking out “or the Corporation” each place 90 STAT. 110it appears in the third and fourth sentences thereof; and (C) by striking out the second sentence thereof. (3) Section 301(b) of such Act (45 U.S.C. 741(b)) is amended in the third sentence thereof by inserting immediately after “of the Corporation” the following: “or of its principal railroad operating subsidiary”. (k) Section 303(b)(4) of such Act (45 U.S.C. 743(b)(4)) is amended by inserting immediately after “is made assumes” the following: “all future liability under such lease and”. (l) Section 303(b) of such Act (45 U.S.C. 743(b)) is amended by inserting at the end thereof the following two new paragraphs: “(5) Notwithstanding any covenant, undertaking, condition, or provision of any sort in any lease, agreement, or contract, the conveyance, transfer, assignment, or other disposition of such lease, agreement, or contract or of any interest therein to, or the assumption by, the Corporation or any subsidiary thereof, or a profitable railroad of obligations thereunder, shall not be deemed a breach, an event of default, or a violation of any covenant of such lease, agreement, or contract. “(6) Notwithstanding anything to the contrary contained in this Act or any other provision of law, the special court shall include in its order such further directions as may be necessary to assure (A) that the operation and administration of the employee pension benefit plans described in section 505(a) of this Act shall be continued, without termination or interruption, by the Corporation until such time as the Corporation elects to amend or terminate any such plan, in whole or in part; and (B) that appropriate transfers and assignments with respect to all rights and obligations relating to such plans shall be made to the Corporation for such purposes, without prejudice to payment of consideration for whatever rights any railroad in reorganization may have in any residual assets under any such employee pension benefit plan. No court shall enter any judgment against the Corporation with respect to any such rights, except that the special court may enter such a judgment in an order issued by it pursuant to subsection (c) of this section, after taking into consideration the rights and obligations transferred pursuant to this paragraph. All liabilities as an employer shall be imposed solely upon the railroad in reorganization in the event such plan is terminated, in whole or in part, by the Corporation within 1 year after the date of such transfer or assignment (except liabilities as an employer under the Employee Retirement Income Security Act of 1974 for benefits accruing during such period).”. (m) Section 301 of such Act (45 U.S.C. 741) is amended by adding at the end thereof the following two new subsections: “(h) Liability of Bisectors.—No director of the Corporation shall be liable, for money damages or otherwise, to any party by reason of the fact that such person is or was a director, if, with respect to the subject matter of the action, suit, or proceeding, such person was fulfilling a duty which he in good faith reasonably believed to lie required by law or vested in him in his capacity as a director of the Corporation or as an officer of the United States. The United States shall indemnify such person against all judgments, amounts paid in settlement, and costs and expenses (including fees of accountants, experts, and attorneys), actually and reasonably incurred in connection with any such action, suit, or proceeding in which such person is determined to have met such standard of conduct. This subsection shall not be construed to grant any immunity from any criminal law of the United States. “(i) Corporate Simplification.—In the interest of corporate simplification, the Corporation, in implementing the final system plan, shall undertake, as soon as possible and pursuant to financial assistance provided by the Railroad Revitalization and Regulatory Reform 90 STAT. 111Act of 1976, to acquire all interests in rail lines and related rail properties otherwise conveyed to the Corporation, upon the tender of such interests to it, so as to eliminate any remaining intermediate layers of ownership or interest, such as leaseholds, owned or held by persons who are neither a railroad, a railroad in reorganization, nor controlled by a railroad in reorganization. Any option conditions regarding the purchase price for such interests, in existence since prior to January 2, 1974, shall be deemed to be conclusive of fair and equitable value.”. (n) Section 303(c)(3) of such Act (45 U.S.C. 743(c)(3)) is amended by adding at the end thereof the following: “The special court shall also find the amount of the payments, if any, which each profitable railroad has made on behalf of a transferor railroad in reorganization in accordance with section 211 (h) of this Act, for which payment the profitable railroad has not been reimbursed, as provided in section 211(h). Notwithstanding any other provision of this paragraph or of paragraph (4), the special court shall order the return to any such profitable railroad from compensation deposited by such profitable railroad pursuant to section 303(a) (2), of any such amount so found together with interest at the rate provided in section 211 (h).”. (o) Section 303(b) (11 of such Act (45 U.S.C. 743(b)(1)) is amended by striking out “railroad leased” and inserting in lieu thereof “person leased”. (p) Section 303(b)(1) of such Act (45 U.S.C. 743(b)(1)) is amended by adding at the end thereof the following: “In any case where the special court orders the trustee or trustees of a railroad in reorganization in the region to execute and deliver deeds or other instruments conveying rail properties to the Corporation or a subsidiary thereof or to a profitable railroad operating in the region or a State or responsible person, those deeds or other instruments may be executed, acknowledged, and delivered on behalf of the trustee or trustees by any person or persons who have been duly authorized to perform such acts on behalf of the trustee or trustees by the district court of the United States or any other court having jurisdiction over the respective railroad in reorganization in the region. Notwithstanding any provision of State or local law, in any case where deeds or other instruments have been executed, acknowledged, or delivered by a representative of the trustee or trustees of a railroad in reorganization in the region in accordance with the previous sentence, such execution, acknowledgment, and delivery, and the deeds or other instruments to which they pertain, shall have the same legal effect as they would have had if the trustee or trustees had themselves executed, acknowledged and delivered such deeds or other instruments.”. (q) (1) Section 303(c) (1) (A) (i) of such Act is amended by inserting after “exchange” the second time it appears the following: “(taking into consideration compensable unconstitutional erosion, if any, which the special court finds to have occurred in the estate of each such railroad, during the bankruptcy proceeding with respect to such railroad)”. (2) Section 303(c) (1) (A) (ii) of such Act (45 U.S.C. 743(c)(1) (A) (ii)) is amended by inserting immediately after “region,” the following: “in exchange for compensation and other benefits accruing to such transferor as a result of such exchange (taking into consideration compensable unconstitutional erosion, if any, which the special court finds to have occurred in the estate of each such railroad, during the bankruptcy proceeding with respect to such railroad)”. (3) Section 303(c)(2) of such Act (45 U.S.C. 743(c)(2)) is amended by inserting immediately after “reorganization” the second time it appears the following: “(taking into consideration compensa-90 STAT. 112ble unconstitutional erosion, if any, which the special court finds to have occurred in the estate of each such railroad, during the bankruptcy proceeding with respect to such railroad)”. (4) Section 303(c)(3) of such Act (45 U.S.C. 743(c)(3)) is amended by adding at the end thereof the following new sentence: “In making any finding under this paragraph, the special court shall take into consideration compensable unconstitutional erosion, if any, which it finds to have occurred in the estate of a railroad in reorganization in the region, or of a railroad leased, operated, or controlled by such a railroad, during the bankruptcy proceeding with respect to such railroad.”.