Exhibit 10.3

July 18, 2014

The Greenbrier Companies, Inc.

One Centerpointe Drive, Suite 200

Lake Oswego, OR 97035

 

Re: Fourth Amendment to Second Amended and Restated Credit Agreement, dated as
of June 30, 2011 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the “Credit Agreement”), among The
Greenbrier Companies, Inc., an Oregon corporation (the “Borrower”), the Lenders
from time to time party thereto, and Bank of America, N.A., as Administrative
Agent.

Ladies and Gentlemen:

Reference is made to the Credit Agreement. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned thereto in the Credit
Agreement.

Consent

The Borrower has advised the Administrative Agent and the Lenders that it
intends to form a joint venture with Watco Companies, L.L.C. the purpose of
which is to conduct a railcar repair, refurbishment and maintenance business.
The joint venture consists of GBW Railcar Services Holdings, L.L.C., a Delaware
limited liability company (“Holdings”), which is the parent company of various
subsidiaries (Holdings and its subsidiaries are referred to herein collectively
as the “Joint Venture”). Such transaction is more fully-described in that
certain press release issued by the Borrower on June 4, 2014.

In connection therewith, the Borrower (directly or indirectly through its
Subsidiaries) intends to (A) make an initial cash capital contribution to the
Joint Venture of $15 million, (B) provide loans to the Joint Venture, (C) sell,
assign, transfer, contribute or otherwise dispose of certain existing assets to
the Joint Venture relating to the Borrower’s and its Subsidiaries’ railcar
repair, refurbishment and maintenance business as existing and as conducted as
of the date hereof (the “Existing Business”), which are used in the Existing
Business as of the date hereof (including (i) customer lists, goodwill and other
intangible assets, (ii) existing railcar repair business inventory (including
work-in-process) the book value of which is estimated to be approximately $18
million which will be sold to the Joint Venture and is expected to be paid for
by the Joint Venture within approximately 90 days after the closing of the JV
Transactions (defined below), (iii) certain contracts, permits and agreements
currently used by the Borrower or one or more of its Subsidiaries in the
Existing Business and (iv) certain property leased by Borrower or one or more of
its Subsidiaries and used in the Existing Business) or Equity Interests in
Greenbrier Rail Services Canada Inc., Brandon Railroad LLC or other
Subsidiaries, who at the time of transfer only have assets or operations
relating to the Existing Business (which sale, assignment, transfer,
contribution or disposition may be in conjunction with a restructuring which may
include transferring such assets to one or more newly-formed Subsidiaries of
Borrower prior to the closing of the JV Transactions), (D) lease or license to
the Joint Venture other existing real estate and existing personal property used
in the Existing Business having a net book value estimated to be approximately
$24 million, which leased or licensed real estate and/or personal property may
be sold, assigned, transferred, contributed or otherwise disposed of at a future
date and may also be located at facilities of the lessee, licensee or transferee
thereof and (E) provide services and seconded employees to the Joint Venture
(collectively, the foregoing, including the future dispositions contemplated in
clause (D) above, are referred to as the “JV Transactions”).

Notwithstanding anything in the Credit Agreement or any other Loan Document to
the contrary, the Required Lenders hereby consent to the JV Transactions, and
agree that:

(1) the JV Transactions shall be additional exceptions to Section 6.05 of the
Credit Agreement and the negative covenants (which for this purpose shall not
include financial covenants)

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currently contained in the Loan Documents and shall not be counted towards or
included in any of the existing baskets set forth therein; provided that the
amount of cash Investments (including loans and capital contributions) in the
Joint Venture permitted under such additional exceptions shall not exceed $45
million outstanding at any time (which, for the avoidance of doubt, shall be net
of the repayment of loans or distributions from the Joint Venture);

(2) (i) the Administrative Agent’s liens on the properties and assets
transferred to the Joint Venture pursuant to the JV Transactions (but not the
proceeds thereof) shall be automatically released upon transfer of title to the
Joint Venture and (ii) upon the leasing by the Borrower or its Subsidiaries to
the Joint Venture of equipment owned as of the date hereof (as described in
subclause (D) of the immediately preceding paragraph) pursuant to the JV
Transactions, the Administrative Agent’s liens on such equipment (but not the
proceeds thereof) shall be automatically released, and, in each case described
in the foregoing subclauses (i) and (ii), the Administrative Agent is authorized
to provide (at the Borrower’s expense) any releases reasonably requested by the
Joint Venture to evidence such release; provided that at such time, if any, that
such equipment described in the foregoing subclause (ii) ceases to be leased to
the Joint Venture (other than as a result of the transfer of title to such
equipment to the Joint Venture) and is owned by a Loan Party, such Loan Party
shall cause such equipment to be pledged as Collateral to secure the
Obligations;

(3) the Administrative Agent shall have the power and authority to consent to,
on behalf of the Lenders, any structural changes to such formation of the Joint
Venture as necessary to close the JV Transactions under the terms of this letter
agreement, including the execution and delivery of applicable subordination and
non-disturbance agreements; and

(4) the Loan Parties shall pledge their Equity Interests in the Joint Venture to
the Administrative Agent to secure the Obligations.

Amendments

In addition, the parties hereto agree that:

(a) the definition of “Consolidated Net Income” in Section 1.01 of the Credit
Agreement is hereby amended and restated to read as follows:

“Consolidated Net Income” means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, the net income of the Borrower and its
Subsidiaries (excluding extraordinary items) for that period; provided, however,
that, without duplication, Consolidated Net Income shall be calculated without
giving effect to (a) the cumulative effect of a change in accounting principles,
(b) any write-off of deferred financing costs incurred as a result of the
refinancing of Indebtedness, (c) purchase accounting adjustments required or
permitted by GAAP, (d) any non-cash net after-tax income or loss from operating
results of discontinued operations as determined by GAAP, and any after-tax
gains or losses from sales of discontinued operations, (e) any non-cash
impairment, charges or asset write-downs or write-offs (other than write-downs
or write-offs of current assets), and (f) the net income (or loss) for such
period of any Person that is not a Subsidiary; provided that Consolidated Net
Income of the Borrower and its Subsidiaries shall be increased by the amount of
dividends, distributions and other payments based on equity ownership that are
actually paid in cash to the Borrower or a Subsidiary in respect of such period,
in each case pursuant to GAAP.

 

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(b) the definition of “Stockholders’ Equity” in Section 1.01 of the Credit
Agreement is hereby amended and restated to read as follows:

“Stockholders’ Equity” means, as of any date of determination, consolidated
stockholders’ equity of the Borrower and its Subsidiaries (as reported as “Total
equity – Greenbrier” on the consolidated balance sheet of the Borrower, which
shall not include equity attributable to non-controlling interests) as of that
date determined in accordance with GAAP but excluding any non-cash impact of
(i) goodwill impairment charges, (ii) increases (or decreases) from accumulated
other comprehensive income (or loss) and (iii) the issuance of any equity or
equity-linked securities.

(c) The second sentence in Section 1.03(c) of the Credit Agreement is hereby
amended and restated to read as follows:

All references herein to consolidated financial statements of the Borrower and
its Subsidiaries shall be deemed to include each variable interest entity (other
than any such entity that is an SPE) that the Borrower is required to
consolidate pursuant to FASB Interpretation No. 46 – Consolidation of Variable
Interest Entities: an interpretation of ARB No. 51 (January 2003) as if such
variable interest entity were a Subsidiary as defined herein.

(d) existing Section 7.06(f) of the Credit Agreement is re-lettered to be
Section 7.06(g); the “and” at the end of Section 7.06(e) of the Credit Agreement
is deleted; and the following new Section 7.06(f) is added to the Credit
Agreement to read as follows:

(f) to the extent constituting Restricted Payments, upon the vesting of Equity
Interests pursuant to the terms of any agreement with employees, consultants or
directors or pursuant to the terms of the Borrower’s equity compensation plans
or agreements, the Borrower may (i) repurchase a portion of such Equity
Interests (through any “net” settling of any Equity Interest or through a tax
withholding feature of any Equity Interest) to the extent such repurchased
Equity Interests represent the exercise price of options or warrants or the
amount of withholding taxes due upon such exercise or vesting and (ii) make tax
withholding payments on behalf of such employees, consultants or directors in
connection therewith; and

(e) the annual limitation on capital expenditures set forth in Section 7.12 of
the Credit Agreement for fiscal year 2014 is hereby increased from $50 million
to $70 million.

Representations of Loan Parties

Each Loan Party hereby represents and warrants to the Administrative Agent and
the Lenders that:

1. The representations and warranties of (i) the Borrower contained in Article V
of the Credit Agreement and (ii) each Loan Party contained in each other Loan
Document or in any document furnished at any time under or in connection
herewith or therewith, are true and correct in all material respects on and as
of the date hereof, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they are true
and correct in all material respects as of such earlier date, and the
representations and warranties contained in subsections (a) and (b) of
Section 5.05 of the Credit Agreement shall be deemed to refer to the most recent
statements furnished pursuant to clauses (a) and (b), respectively, of
Section 6.01 of the Credit Agreement.

2. After giving effect to this letter agreement, no Default has occurred and is
continuing.

Miscellaneous

This letter agreement is a Loan Document. All references in the Credit Agreement
and the other Loan Documents to the “Credit Agreement” shall be deemed to refer
to the Credit Agreement as amended hereby.

 

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Except as modified hereby, all of the terms and provisions of the Credit
Agreement and the other Loan Documents shall remain in full force and effect.

This letter agreement shall become effective upon the execution hereof by the
Loan Parties, the Required Lenders and the Administrative Agent.

This letter agreement shall be governed by the laws of the State of New York.

This letter agreement may be executed in one or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument. Delivery of executed counterparts of this Agreement by
telecopy or .pdf shall be effective as an original.

[The remainder of this page is intentionally left blank.]

 

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This letter agreement shall be governed by and construed in accordance with the
laws of the State of New York.

 

Sincerely,

BANK OF AMERICA, N.A., as Administrative Agent By  

/s/ Joan Mok

Name:  

Joan Mok

Title:  

Vice President

 

Fourth Amendment

The Greenbrier Companies, Inc.

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ACCEPTED AND AGREED AS OF THE DATE FIRST ABOVE WRITTEN:

 

BORROWER:     THE GREENBRIER COMPANIES, INC.,     an Oregon corporation     By:
 

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President, Corporate
Finance       and Treasurer SUBSIDIARY       GUARANTORS:     GUNDERSON LLC,    
an Oregon limited liability company     By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GREENBRIER LEASING COMPANY, LLC,

an Oregon limited liability company

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GREENBRIER RAILCAR LLC,

an Oregon limited liability company

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GUNDERSON RAIL SERVICES LLC,

an Oregon limited liability company

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GUNDERSON MARINE LLC,

an Oregon limited liability company

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer

 

Fourth Amendment

The Greenbrier Companies, Inc.

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    GREENBRIER-CONCARRIL, LLC,     a Delaware limited liability company     By:
 

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GREENBRIER LEASING LIMITED PARTNER,

LLC, a Delaware limited liability company

    By: Greenbrier Leasing Company LLC     Its: Sole Member     By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GREENBRIER MANAGEMENT SERVICES,

LLC, a Delaware limited liability company

    By: Greenbrier Leasing Company LLC     Its: Sole Member     By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

BRANDON RAILROAD LLC,

an Oregon limited liability company

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

MERIDIAN RAIL HOLDINGS CORP.,

an Oregon corporation

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

MERIDIAN RAIL ACQUISITION CORP.,

an Oregon corporation

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer

 

Fourth Amendment

The Greenbrier Companies, Inc.

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    MERIDIAN RAIL MEXICO CITY CORP.     an Oregon corporation     By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GREENBRIER LEASING, L.P.,

a Delaware limited partnership

    By: Greenbrier Management Services, LLC     Its:   General Partner     By:
Greenbrier Leasing Company LLC     Its:   Sole Member     By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GUNDERSON SPECIALTY PRODUCTS, LLC,

a Delaware limited liability company

    By:  Gunderson LLC     Sole Member     By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

GREENBRIER RAILCAR LEASING, INC.

a Washington corporation

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer    

AUTOSTACK COMPANY LLC,

an Oregon corporation

    By:  

/s/ Lorie L. Leeson

    Name:   Lorie L. Leeson     Title:   Senior Vice President and Treasurer

 

Fourth Amendment

The Greenbrier Companies, Inc.

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ACCEPTED AND AGREED AS OF THE DATE FIRST ABOVE WRITTEN:

 

LENDERS:    

BANK OF AMERICA, N.A., as a Lender and as L/C

Issuer and Swing Line Lender

    By  

/s/ Chris Swindell

    Name:  

Chris Swindell

    Title:  

SVP

    UNION BANK, N.A., as a Lender     By  

/s/ Stephen Sloan

    Name:  

Stephen Sloan

    Title:  

Vice President

    FIFTH THIRD BANK, as a Lender     By  

/s/ Mark G. Gerlach

    Name:  

Mark G. Gerlach

    Title:  

Vice President

    UMPQUA BANK, as a Lender     By  

 

    Name:  

 

    Title:  

 

   

GOLDMAN SACHS LENDING PARTNERS LLC, as a

Lender

    By  

/s/ Michelle Latzoni

    Name:  

Michelle Latzoni

    Title:  

Authorized Signatory

    BANK OF THE WEST, as a Lender     By  

/s/ Brett German

    Name:  

Brett German

    Title:  

Vice President

   

CRÉDIT INDUSTRIEL ET COMMERCIAL, NEW

YORK BRANCH, as a Lender

    By  

 

    Name:  

 

    Title:  

 

 

Fourth Amendment

The Greenbrier Companies, Inc.

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    COLUMBIA BANK, as a Lender     By  

/s/ Kevin N. Meabon

    Name:  

Kevin N. Meabon

    Title:  

Senior Vice President

    THE PRIVATEBANK, as a Lender     By  

/s/ Zach Leonard

    Name:  

Zach Leonard

    Title:  

Associate Managing Director

   

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as a Lender

    By  

/s/ Rachelle Goude

    Name:  

Rachelle Goude

    Title:  

Vice President/Loan Team Manager

 

Fourth Amendment

The Greenbrier Companies, Inc.