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Debt | 9 Months Ended
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Sep. 30, 2021
Debt Disclosure [Abstract] |
Debt | Debt The table below summarizes the Company's key terms and carrying value of debt (in thousands):
| Contractual Weighted Avg Interest Rate(1) |  | Maturity Range(1) |  | September 30, 2021 |  | December 31, 2020
|  | From |  | To |  |
Institutional notes | —% |  | — |  | — |  | $ | — |  |  | $ | 1,642,314 |
Asset-backed securitization term notes | 1.98% |  | August 2023 |  | February 2031 |  | 3,893,421 |  |  | 2,920,807 |
Corporate notes | 1.82% |  | August 2023 |  | June 2031 |  | 2,300,000 |  |  | — |
Term loan facilities | 1.58% |  | July 2024 |  | May 2026 |  | 1,023,600 |  |  | 840,000 |
Asset-backed securitization warehouse | 1.94% |  | November 2027 |  | November 2027 |  | 320,000 |  |  | 264,000 |
Revolving credit facilities | 1.62% |  | May 2024 |  | July 2026 |  | 755,000 |  |  | 760,500 |
Finance lease obligations | 4.93% |  | February 2022 |  | February 2022 |  | 15,619 |  |  | 17,304 |
Total debt outstanding |  |  |  |  |  |  | 8,307,640 |  |  | 6,444,925 |
Unamortized debt costs |  |  |  |  |  |  | (62,630) |  |  | (42,747) |
Unamortized debt premiums & discounts |  |  |  |  |  |  | (3,738) |  |  | (599) |
Unamortized fair value debt adjustment |  |  |  |  |  |  | (32) |  |  | 1,691 |
Debt, net of unamortized costs |  |  |  |  |  |  | $ | 8,241,240 |  |  | $ | 6,403,270 |
(1) Data as of September 30, 2021. The fair value of total debt outstanding was $8,311.1 million and $6,536.5 million as of September 30, 2021 and December 31, 2020, respectively, and was measured using Level 2 inputs. As of September 30, 2021, the maximum borrowing levels for the Asset-backed Securitization ("ABS") warehouse and the revolving credit facilities are $1,125.0 million and $1,275.0 million, respectively. These facilities are governed by borrowing bases that limit borrowing capacity to an established percentage of relevant assets. As of September 30, 2021, the availability under these credit facilities without adding additional container assets to the borrowing base was approximately $876.8 million. The Company is subject to certain financial covenants under its debt agreements. The agreements remain the obligations of the respective subsidiaries, and all related debt covenants are calculated at the subsidiary level. As of September 30, 2021 and December 31, 2020, the Company was in compliance with all financial covenants in accordance with the terms of its debt agreements. The Company hedges the risks associated with fluctuations in interest rates on a portion of its floating-rate debt by entering into interest rate swap agreements that convert a portion of its floating-rate debt to a fixed rate basis, thus reducing the impact of interest rate changes on future interest expense. The following table summarizes the Company's outstanding fixed-rate and floating-rate debt as of September 30, 2021 (in thousands):
| Balance Outstanding |  | Contractual Weighted Avg Interest Rate |  | Maturity Range |  | Weighted Avg Remaining Term
|  |  | From |  | To |
Excluding impact of derivative instruments: |  |  |  |  |  |  |  |  |
Fixed-rate debt | $5,591,500 |  | 1.96% |  | Feb 2022 |  | Jun 2031 |  | 5.0 years
Floating-rate debt | $2,716,141 |  | 1.65% |  | Aug 2023 |  | Nov 2027 |  | 3.2 years
Including impact of derivative instruments: |  |  |  |  |  |  |  |  |
Fixed-rate debt | $5,591,500 |  | 1.96% |  |  |  |  |  |
Hedged floating-rate debt | $1,654,103 |  | 3.58% |  |  |  |  |  |
Total fixed and hedged debt | $7,245,603 |  | 2.33% |  |  |  |  |  |
Unhedged floating-rate debt | $1,062,037 |  | 1.65% |  |  |  |  |  |
Total | $8,307,640 |  | 2.24% |  |  |  |  |  |
The Company issued the following corporate notes during the nine months ended September 30, 2021:
Date |  | Total Offering |  |  | Contractual Weighted Avg Interest Rate |  | Maturity
April 15, 2021 |  | $600.0 Million |  |  | 2.05% |  | Apr 2026
June 7, 2021 |  | $500.0 Million |  |  | 1.15% |  | Jun 2024
June 7, 2021 |  | $600.0 Million |  |  | 3.15% |  | Jun 2031
August 6, 2021 |  | $600.0 Million |  |  | 0.80% |  | Aug 2023
The Company issued the following ABS fixed rate series during the nine months ended September 30, 2021:
Date |  | Total Offering |  |  | Contractual Weighted Avg Interest Rate |  | Expected Maturity
February 3, 2021 |  | $502.9 Million |  |  | 1.69% |  | Feb 2031
March 17, 2021 |  | $725.0 Million |  |  | 1.89% |  | Dec 2030
On May 27, 2021, the Company extinguished a term loan and paid the outstanding balance of $820.0 million. As a result, the Company wrote off $1.8 million of debt related costs. Concurrently, the Company entered into a delayed draw term loan facility with a maximum capacity of $1,200.0 million at an interest rate of 1-month LIBOR plus 1.375% and a maturity date of May 27, 2026. On June 28, 2021, the Company redeemed approximately $821.0 million of its outstanding institutional notes. As a result, the Company paid a make-whole premium of $84.8 million and wrote off $2.5 million of debt related costs. The cash paid for the make-whole premium is classified under financing cash flows as payments under debt facilities and finance lease obligations. On August 30, 2021, the Company redeemed the remaining $648.9 million of its outstanding institutional notes. As a result, the Company paid a make-whole premium of $43.1 million and recognized a gain of $0.6 million from the write-off of unamortized debt costs and fair value adjustments. The cash paid for the make-whole premium is classified under financing cash flows as payments under debt facilities and finance lease obligations. Institutional Notes The Company's institutional notes were fully redeemed during the nine months ended September 30, 2021. Asset-Backed Securitization Term Notes Under the Company's ABS facilities, indirect wholly-owned subsidiaries of the Company issue ABS notes. These subsidiaries are intended to be bankruptcy remote so that such assets are not available to creditors of the Company or its affiliates until and unless the related secured borrowings have been fully discharged. These transactions do not meet accounting requirements for sales treatment and are recorded as secured borrowings. The Company’s borrowings under the ABS facilities amortize in monthly installments, typically in level payments over five or more years. These facilities provide for an advance rate against the net book values of designated eligible equipment. The net book values for purposes of calculating eligible equipment is determined according to the related debt agreement and may be different than those calculated per U.S. GAAP. The Company is required to maintain restricted cash balances on deposit in designated bank accounts equal to three to nine months of interest expense depending on the terms of each facility. Corporate Notes The Company’s corporate notes have maturities ranging from 2 - 10 years and interest payments due semi-annually. These corporate notes are initially secured by assets of the subsidiary. If the Company satisfies certain credit rating conditions outlined in the indenture, the corporate notes may become unsecured. The corporate notes are pre-payable (in whole or in part) at the Company's option at any time prior to the maturity date, subject to certain provisions in the corporate note agreements, including the payment of a make-whole premium in respect to such prepayment. Term Loan Facilities The Company's term loan facilities have a maximum borrowing capacity of $1,518.6 million which amortizes in monthly or quarterly installments. These facilities provide for an advance rate against the net book values of designated eligible equipment. One facility has a borrowing capacity of $1,200.0 million and provides a delayed draw feature which is available to the Company until November 24, 2021. Asset-Backed Securitization Warehouse Under the Company’s ABS warehouse facility, an indirect wholly-owned subsidiary of the Company issues ABS notes. This subsidiary is intended to be bankruptcy remote so that such assets are not available to creditors of the Company or its affiliates until and unless the related secured borrowings have been fully discharged. These transactions do not meet accounting requirements for sales treatment and are recorded as secured borrowings. The Company's ABS warehouse facility has a borrowing capacity of $1,125.0 million that is available on a revolving basis until November 13, 2023, paying interest at LIBOR plus 1.85%, after which any borrowings will convert to term notes with a maturity date of November 15, 2027, paying interest at LIBOR plus 2.85%. During the revolving period, the borrowing capacity under this facility is determined by applying an advance rate against the net book values of designated eligible equipment. The net book values for purposes of calculating eligible equipment are determined according to the related debt agreement and may be different than those calculated per U.S. GAAP. The Company is required to maintain restricted cash balances on deposit in designated bank accounts equal to three months of interest expense. Revolving Credit Facilities The revolving credit facilities have a maximum borrowing capacity of $1,275.0 million. These facilities provide for an advance rate against the net book values of designated eligible equipment. Finance Lease Obligations Certain containers are leased with a financial institution. The lease is accounted for as a finance lease, with interest expense recognized on a level yield basis over the period preceding early purchase options, which is five to seven years from the transaction date. The Company has provided notice to early terminate these finance lease obligations in the first quarter of 2022.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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