Long-term Debt (Notes)

12 Months Ended

Dec. 31, 2016

Long-term Debt, Unclassified [Abstract]

Long-term Debt

LONG-TERM DEBT:

Long-term debt consisted of the following as of December 31, 2016 and 2015 (dollars in thousands):

	2016			2015
Credit Agreement with variable interest rates (weighted average of 2.71% and 2.60% before impact of interest rate swaps at December 31, 2016 and 2015, respectively) due 2020	$	1,630,406		$	2,177,724
Australian Credit Agreement with variable interest rates (weighted average of 4.64% before impact of interest rate swaps at December 31, 2016) due 2021	498,801			—
Partner Loan Agreement (6.51% interest rate at December 31, 2016) due 2026	172,154			—
Other debt and capital leases	91,278			127,535
Less: Unamortized debt issuance costs long-term	(33,186		)	(23,508		)
Long-term debt	2,359,453			2,281,751
Less: current portion, net of unamortized debt issuance costs	52,538			75,966
Long-term debt, less current portion	$	2,306,915		$	2,205,785

On January 1, 2016, the Company adopted the FASB's ASU 2015-03, Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, which requires debt issuance costs to be recorded as a direct reduction of the debt liability on the balance sheet rather than as an asset. The Company applied this guidance to all of its outstanding debt issuance costs retrospectively to all periods presented. The December 31, 2015 consolidated balance sheet and related disclosures were adjusted to reflect the reclassification of $23.5 million of debt issuance costs from other assets to a reduction in current portion of long-term debt of $6.0 million and a reduction in long-term debt, less current portion, of $17.5 million. There was no other impact on the consolidated financial statements from the adoption of this guidance.

Credit Agreement

In anticipation of its acquisition of Freightliner, the Company entered into the Second Amended and Restated Senior Secured Syndicated Facility Agreement (the Credit Agreement) on March 20, 2015. At closing, the credit facilities under the Credit Agreement were comprised of a $1,782.0 million United States term loan, an A$324.6 million (or $252.5 million at the exchange rate on March 20, 2015) Australian term loan, a £101.7 million (or $152.2 million at the exchange rate on March 20, 2015) U.K. term loan and a $625.0 million revolving credit facility. The revolving credit facility includes borrowing capacity for letters of credit and swingline loans. The stated maturity date of each of the Company's credit facilities under the Credit Agreement is March 31, 2020.

On October 20, 2016, the Company entered into Amendment No. 2 to the Credit Agreement (Amendment No. 2). Amendment No. 2 permitted, among other things, the Company to enter into the Australia Partnership Transaction and the GRail Transactions (collectively, the Australian Reorganization). Amendment No. 2 also permitted the repayment in full and termination of the obligations of the Australia Partnership and its subsidiaries (the Australian Loan Parties) under the Credit Agreement (the Australian Refinancing). Following the Australian Refinancing and Australian Reorganization, the Australian Loan Parties became unrestricted subsidiaries under, ceased to be party to and have no obligations under the Credit Agreement.

In connection with the Australian Reorganization, the Company repaid in full the outstanding Australian term loan of A$250.0 million (or $185.3 million at the exchange rate on December 1, 2016 when the payment was made). During 2016, prior to repaying the loan, the Company made prepayments on its Australian term loan of A$35.6 million (or $26.6 million at the exchange rate on the dates the payments were made). The Company also made a scheduled quarterly principal payment of A$4.1 million (or $3.1 million at the exchange rate on the date the payment was made) on the Australian term loan.

As a result of the Australian Reorganization, on December 1, 2016, the $625.0 million revolving credit facility under the Credit Agreement was reallocated and includes flexible sub-limits for revolving loans denominated in United States dollars, British pounds, Canadian dollars and Euros and provides for the ability to reallocate commitments among the sub-limits, provided that the total amount of all British pound, Canadian dollar, Euro or other designated currencies sub-limits cannot exceed a combined $500.0 million.

At the Company's election, at the time of entering into specific borrowings under the Credit Agreement, interest on borrowings is calculated under a "Base Rate" or "LIBOR." The applicable borrowing spread for the Base Rate loans ranges from 0.0% to 1.0% depending upon the Company's total leverage ratio as defined in the Credit Agreement. The applicable borrowing spread for LIBOR Rate loans ranges from 1.0% to 2.0% depending upon the Company's total leverage ratio as defined in the Credit Agreement.

In addition to paying interest on any outstanding borrowings under the Credit Agreement, the Company is required to pay a commitment fee related to the unutilized portion of the commitments under the revolving credit facility. The commitment fee rate ranges from 0.2% to 0.3% depending upon the Company's total leverage ratio as defined in the Credit Agreement.

During the year ended December 31, 2016, the Company made prepayments on its United States term loan of $317.1 million and U.K. term loan of £0.7 million (or $0.9 million at the exchange rate on the date the payment was made). The Company also made scheduled quarterly principal payments of $26.9 million on the United States term loan and £2.5 million (or $3.2 million at the exchange rate on the date the payments were made) on the U.K. term loan.

The United States dollar-denominated and the British pound-denominated term loans began to amortize in quarterly installments during the three months ended September 30, 2016, with the remaining principal balance payable upon maturity, as set forth below (amounts in thousands):

	Quarterly Payment Date	Principal Amount Due on Each Payment Date
United States dollar:	March 31, 2017 through June 30, 2018	$	5,083
	September 30, 2018 through December 31, 2019	$	10,167
	Maturity date - March 31, 2020	$	1,336,500
British pound:	March 31, 2017 through June 30, 2018	£	1,271
	September 30, 2018 through December 31, 2019	£	2,542
	Maturity date - March 31, 2020	£	75,532

As of December 31, 2016, the Company had the following outstanding term loans under its Credit Agreement (amounts in thousands, except percentages):

	Local Currency		United States Dollar Equivalent		Interest Rate
United States dollar	$	1,428,000	$	1,428,000	2.77	%
British pound	£	98,410	$	121,418	2.26	%

The Company's availability to draw from the unused borrowing capacity is subject to covenant limitations as discussed below. As of December 31, 2016, the Company had the following unused borrowing capacity under its revolving credit facility (amounts in thousands):

	2016
Total available borrowing capacity	$	625,000
Outstanding revolving loans	$	80,988
Outstanding letter of credit guarantees	$	2,419
Unused borrowing capacity	$	541,593

As of December 31, 2016, the Company had the following outstanding revolving loans under its revolving credit facility (amounts in thousands, except percentages):

	Local Currency		United States Dollar Equivalent		Interest Rate
British pound (swingline loan)	£	1,000	$	1,234	2.48	%
British pound	£	37,000	$	45,651	2.26	%
Canadian dollar	C$	10,500	$	7,821	2.93	%
Euro	€	24,900	$	26,282	2.00	%

The Credit Agreement contains a number of customary affirmative and negative covenants with respect to which the Company must maintain compliance. Those covenants, among other things, limit or prohibit the Company's ability, subject to certain exceptions, to incur additional indebtedness; create liens; make investments; pay dividends on capital stock or redeem, repurchase or retire capital stock; consolidate or merge or make acquisitions or dispose of assets; enter into sale and leaseback transactions; engage in any business unrelated to the business currently conducted by the Company; sell or issue capital stock of certain of the Company's restricted subsidiaries; change the Company's fiscal year; enter into certain agreements containing negative pledges and upstream limitations and engage in certain transactions with affiliates.

The existing term loans and revolving loans under the Credit Agreement are guaranteed by substantially all of the Company's United States subsidiaries and by substantially all of its foreign subsidiaries, other than its Australian subsidiaries, solely in respect of the foreign guaranteed obligations subject, in each case, to certain exceptions. The Credit Agreement is collateralized by certain real and personal property assets of the Company's domestic subsidiaries that have guaranteed the Company's obligations under the Credit Agreement and certain personal property assets of its foreign subsidiaries that have guaranteed the foreign obligations under the Credit Agreement.

On September 30, 2015, the Company entered into Amendment No. 1 (Amendment No. 1) to the Credit Agreement. Amendment No. 1 added a senior secured leverage ratio covenant that requires the Company to comply with maximum ratios of senior secured indebtedness, subject, if applicable, to netting of certain cash and cash equivalents of the Company to earnings before interest, income taxes, depreciation and amortization (EBITDA), as defined in Amendment No. 1. In addition, Amendment No. 1 states that if a material acquisition occurs, the senior secured leverage ratio shall be tested at a level 0.50 higher than the applicable level for the quarter following the date of the material acquisition for the next four fiscal quarters, not to exceed 4.50 to 1.00. As a result of the Australian Reorganization, the periods December 31, 2016 through September 30, 2017 have been adjusted to reflect this provision. The maximum senior secured leverage ratio for the applicable periods are set forth in the following table:

Quarterly Periods Ending	Maximum Senior Secured Leverage Ratio
September 30, 2015 through June 30, 2016	4.50 to 1.00
September 30, 2016	4.25 to 1.00
December 31, 2016 through September 30, 2017	4.50 to 1.00
December 31, 2017 through March 31, 2018	3.75 to 1.00
June 30, 2018 through March 31, 2020	3.50 to 1.00

In addition, Amendment No. 1 established a maximum total leverage ratio covenant of 4.50 to 1.00 for the term of the Credit Agreement. If the Company’s total leverage ratio is greater than or equal to 4.00 to 1.00, Amendment No. 1 further provides for a 1.25% and 2.25% margin for floating rate and offered rate loans, respectively, under the Credit Agreement, with the remaining total-leverage ratio-dependent applicable margins remaining unchanged.

Amendment No. 1 also permits the Company, subject to certain limitations, to repurchase shares of the Company's Class A Common Stock with a value of up to $300.0 million during the period commencing on the date of Amendment No. 1 and ending on the maturity date under the Credit Agreement. The repurchases are subject to limitations requiring the Company’s total leverage ratio to not exceed 4.00 to 1.00 and the Company to maintain at least $150.0 million of cash and available revolving credit capacity (liquidity), in each case, on a pro forma basis. If the Company’s total leverage ratio after giving effect to such repurchases on a pro forma basis were less than 3.00 to 1.00, then the applicable share repurchase limit and liquidity restrictions do not apply, but other restrictions and limitations may apply. Following the approval of Amendment No. 1 by the Board on September 29, 2015, the Board authorized the repurchase of up to $300.0 million of the Company's Class A Common Stock and appointed a special committee of the Board to review and approve repurchases proposed by management. The Company repurchased no shares of Class A Common Stock under this authorization during the years ended December 31, 2016 and 2015.

As of December 31, 2016, the Company was in compliance with the covenants under the Credit Agreement, as amended by Amendment No. 1 and Amendment No. 2 (the Amendments), including the maximum senior secured leverage ratio covenant noted above.

Australian Credit Facility

In anticipation of the completion of the Australian Reorganization, the Company’s recently established subsidiary, GWI Acquisitions Pty Ltd (GWIA), entered into a syndicated facility agreement on November 28, 2016 (the Australian Credit Agreement) for A$690.0 million (or $511.4 million at the exchange rate on November 28, 2016) in senior secured term loan facilities and A$50.0 million (or $37.1 million at the exchange rate on November 28, 2016) in the form of a revolving credit facility. The term loan facilities are comprised of Tranche A1 amortizing term loan for A$130.0 million (or $96.3 million at the exchange rate on November 28, 2016) and Tranche A2 for A$560.0 million (or $415.0 million at the exchange rate on November 28, 2016), both repayable on the maturity date. The maturity date of the Australian Credit Agreement is December 1, 2021.

 The loan will begin to amortize in quarterly installments commencing with the quarter ending March 31, 2017, with the remaining principal balance payable upon maturity, as set forth below (amounts in thousands):

Quarterly Periods Ending	Principal Amount Due on Each Payment Date
March 31, 2017 through December 31, 2017	A$	4,500
March 31, 2018 through December 31, 2019	A$	5,437
March 31, 2020 through December 31, 2021	A$	8,563
Maturity date - December 1, 2021	A$	560,000

The interest rate per annum applicable to the loans under the Australian Credit Agreement for a relevant interest period will be the sum of the applicable margin and the BBSY. BBSY is the Bank Bill Swap Bid Rate, which the Company believes is generally considered the Australian equivalent to LIBOR. The applicable margin for the loans under the Australian Credit Agreement will initially be (i) 2.70% per annum for Tranche A1 and the revolving credit facility and 2.80% per annum for Tranche A2. Following the delivery of GWIA’s first compliance certificate after the effective date in accordance with the terms of the Australian Credit Agreement, the applicable margin will range from 2.35% per annum to 3.65% per annum for Tranche A1 and the revolving credit facility and 2.45% per annum to 3.75% per annum for Tranche A2, depending upon the total leverage ratio of GWIA and the obligors under the agreement (GWA Group).

The Australian Credit Agreement requires the GWA Group to comply with certain financial covenants including a debt service coverage ratio and leverage ratio. The financial covenants are calculated for a period of 12 months ending on the calculation date. The first calculation date will be June 30, 2017. For the purpose of calculating the financial covenants for a period of less than 12 months, certain adjustments will be made in accordance with the agreement. The debt service coverage ratio shall be equal to or greater than 1.20 to 1.00. The maximum leverage ratio of net senior debt to EBITDA, as defined in the agreement, are set forth in the following table:

Calculation date falling in the following period	Leverage Ratio
January 1, 2017 through December 31, 2017	5.25 to 1.00
January 1, 2018 through December 31, 2018	4.75 to 1.00
January 1, 2019 through December 31, 2020	4.50 to 1.00
January 1, 2021 through December 31, 2021	4.25 to 1.00

In addition to paying interest on outstanding principal under the Australian Credit Agreement, GWIA will be required to pay a commitment fee with respect to the unutilized portion of the commitments under the revolving credit facility. The commitment fee rate will initially be 45% of the applicable margin from time to time under the facility to which the unutilized portion of the commitments relate. GWIA will also pay customary letter of credit and agency fees.

The Australian Credit Agreement also requires GWIA to maintain interest rate swap agreements so that until December 1, 2019, at least 75% of the aggregate debt under the term loan facilities is hedged against interest rate risk and after December 1, 2019, at least 50% of the aggregate debt under the term loan facilities is hedged against interest rate risk until at least September 1, 2021. For additional information regarding the Australian interest rate swaps, see Note 9, Derivative Financial Instruments.

GWIA's availability to draw from the unused borrowing capacity is subject to covenant limitations as discussed below. As of December 31, 2016, GWIA had the following unused borrowing capacity under its revolving credit facility (amounts in thousands):

	2016
Total available borrowing capacity	A$	50,000
Outstanding letter of credit guarantees	A$	3,137
Unused borrowing capacity	A$	46,863

In connection with the Australian Credit Agreement, GWIA and certain obligors (the Australia Guarantors), subject to certain exceptions and grace periods, have guaranteed and granted security interests over substantially all of their assets to guarantee and secure amounts borrowed under the credit agreement. Pursuant to the security documents, amounts borrowed under the Australian Credit Agreement, and any other amounts owing under the finance documents (including hedge agreements) are secured on a first priority basis by a perfected security interest over substantially all of the tangible and intangible assets (subject to certain exceptions) of GWIA and the Australia Guarantors, including the capital stock of each of GWIA’s direct and indirect wholly-owned material subsidiaries.

The Australian Credit Agreement contains a number of customary affirmative and negative covenants that, among other things, limit or restrict the ability of GWIA and the Guarantors, subject to certain exceptions, to: incur additional indebtedness; create liens; make investments; pay dividends on capital stock or redeem, repurchase or retire capital stock; consolidate or merge; enter into sale and leaseback transactions; change the business conducted by GWIA and the Australia Guarantors; sell capital stock of certain Australia Guarantors; enter into certain agreements or make amendments to certain agreements; and engage in certain transactions with affiliates.

The Australian Credit Agreement contains customary events of default which apply to GWIA and certain obligors, including nonpayment of principal, interest, fees or other amounts; violation of certain covenants (including the financial covenants); material inaccuracy of a representation or warranty when made; cross-default to other indebtedness; the occurrence of certain bankruptcy or insolvency events; material unsatisfied judgments; actual or asserted invalidity or the repudiation of any finance document in connection with the credit facilities; appropriation by a government agency of material business property of a Australia Guarantor; and the occurrence of certain events which would have a material adverse effect. Certain events of default are subject to customary remedy periods and the violation of certain financial covenants referred to above is subject to cure rights.

Partner Loan Agreement

On December 1, 2016, GWAHLP and MIRA entered into a Partner Loan Agreement with an A$238.0 million non-recourse subordinated partner loan from MIRA used to fund a portion of its contribution to the Australia Partnership to fund the acquisition of GRail (note the Company's subsidiary, GWI Holding B.V., has a matching partner loan for a portion of its contribution that is eliminated in consolidation). The Partner Loan Agreement is subordinated to the Australian Credit Agreement. The maturity date of the partner loan is November 1, 2026.

The interest on the Partner Loan Agreement is calculated using BBR plus a 4.5% margin for each six month period commencing initially on December 1, 2016, and ending on the first interest payment date on June 30, 2017. Subsequently, each six month period commences on an interest payment date and ends on the next interest payment date. BBR is the Bankers Buyers Rate, which the Company believes is generally considered analogous with BBSY.

In addition to paying interest on the outstanding borrowings under the Partner Loan Agreement, the Australia Partnership is required to pay a commitment fee equal to 2.75% of the commitment. The commitment fee is payable annually in ten installments commencing on the first interest payment date.

Non-Interest Bearing Loan

In 2010, as part of the acquisition of FreightLink Pty Ltd, Asia Pacific Transport Pty Ltd and related corporate entities (FreightLink Acquisition), the Company assumed debt with a carrying value of A$1.8 million (or $1.7 million at the exchange rate on December 1, 2010), which represented the fair value of an A$50.0 million (or $48.2 million at the exchange rate on December 1, 2010) non-interest bearing loan due in 2054. As of December 31, 2016, the carrying value of the loan was A$2.9 million (or $2.1 million at the exchange rate on December 31, 2016) with a non-cash imputed interest rate of 8.0%.

Schedule of Future Payments Including Capital Leases

The following is a summary of the maturities of the Company's long-term debt, including capital leases, as of December 31, 2016 (dollars in thousands):

	Amount
2017	$	61,080
2018	64,517
2019	77,324
2020	1,548,819
2021	443,956
Thereafter (1)	231,022
Total	$	2,426,718

(1) Includes the A$50.0 million (or $36.1 million at the exchange rate on December 31, 2016) non-interest bearing loan due in 2054 assumed in the FreightLink Acquisition with a carrying value of A$2.9 million (or $2.1 million at the exchange rate on December 31, 2016).

Debt Issuance Costs

Debt issuance costs as of December 31, 2016 and 2015 were as follows (dollars in thousands):

	2016			2015
Debt issuance costs, gross	$	42,495		$	28,248
Accumulated amortization	(9,309		)	(4,740		)
Debt issuance costs, net	$	33,186		$	23,508
Weighted average amortization period (in years)	3			4

For the years ended December 31, 2016, 2015 and 2014, the Company amortized $7.7 million, $7.6 million and $12.2 million, respectively, of unamortized debt issuance costs as an adjustment to interest expense. Unamortized debt issuance costs are amortized as an adjustment to interest expense over the terms of the related debt using the effective-interest method for the term debt and the straight-line method for the revolving credit facility portion of debt. The 2016 amortization amount included $1.3 million associated with the write-off of unamortized debt issuance costs as a result of the Amendment Agreement, and deferred $3.0 million of costs. In connection with the Australian Credit Agreement, the Company deferred A$19.8 million (or $14.7 million at the exchange on December 1, 2016) of costs. The 2015 amortization amount included $2.0 million associated with the write-off of unamortized debt issuance costs as a result of the March 2015 refinancing of the Company's credit agreement and deferred $5.8 million of costs. The 2014 amortization amount included $4.6 million associated with the write-off of unamortized debt issuance costs and deferred $3.7 million of costs as a result of the May 2014 refinancing of the Company's credit agreement.

As of December 31, 2016, the Company estimated the future interest expense related to amortization of its unamortized debt issuance costs will be as follows for the periods presented (dollars in thousands):

	Amount
2017	$	8,957
2018	8,815
2019	8,638
2020	4,173
2021	2,603
Total	$	33,186