Debt

9 Months Ended

Sep. 30, 2019

The carrying amounts and estimated fair values of our long-term debt are as follows:



	September 30, 2019					December 31, 2018
	Carrying Value			Estimated Fair Value		Carrying Value			Estimated Fair Value
	(in millions)
Corporate – Recourse:
Revolving credit facility	$	75.0		$	75.0	$	—		$	—
Senior notes, net of unamortized discount of $0.2 and $0.3	399.8			407.1		399.7			343.7
	474.8			482.1		399.7			343.7
Less: unamortized debt issuance costs	(2.1		)			(2.3		)
Total recourse debt	472.7					397.4

Leasing – Non-recourse:
Wholly-owned subsidiaries:
2006 secured railcar equipment notes	114.7			120.0		133.4			138.0
2009 secured railcar equipment notes	150.7			174.6		159.7			174.0
2010 secured railcar equipment notes	251.2			270.6		257.0			264.0
2017 promissory notes	635.4			635.4		660.2			660.2
2018 secured railcar equipment notes, net of unamortized discount of $0.2 and $0.2	457.3			478.3		472.2			475.2
TRIHC 2018 secured railcar equipment notes, net of unamortized discount of $2.1 and $2.5	268.3			275.2		279.0			278.1
2019 secured railcar equipment notes, net of unamortized discount of $0.2 and $-	521.3			536.0		—			—
TILC warehouse facility	545.8			545.8		374.8			374.8
	2,944.7			3,035.9		2,336.3			2,364.3
Less: unamortized debt issuance costs	(21.5		)			(19.7		)
	2,923.2					2,316.6
Partially-owned subsidiaries:
TRL 2012 secured railcar equipment notes	376.8			387.4		386.2			370.9
TRIP Master Funding secured railcar equipment notes	923.8			1,005.6		941.7			963.0
	1,300.6			1,393.0		1,327.9			1,333.9
Less: unamortized debt issuance costs	(11.3		)			(12.7		)
	1,289.3					1,315.2
Total non–recourse debt	4,212.5					3,631.8
Total debt	$	4,685.2		$	4,911.0	$	4,029.2		$	4,041.9

The estimated fair value of our Senior Notes is based on a quoted market price in a market with little activity as of September 30, 2019 and December 31, 2018 (Level 2 input). The estimated fair values of our 2006, 2009, 2010, 2012, 2018, and 2019 secured railcar equipment notes, TRIHC 2018 LLC ("TRIHC 2018"), and TRIP Rail Master Funding LLC (“TRIP Master Funding”) secured railcar equipment notes are based on our estimate of their fair value as of September 30, 2019 and December 31, 2018 using unobservable input values provided by a third party (Level 3 inputs). The respective carrying values of our revolving credit facility, TILC warehouse facility, and 2017 promissory notes approximate fair value because the interest rate adjusts to the market interest rate.

Revolving Credit Facility — We have a $450.0 million unsecured corporate revolving credit facility that matures in November 2023. During the nine months ended September 30, 2019, we had total borrowings of $825.0 million and total repayments of $750.0 million under the revolving credit facility, with a remaining outstanding balance of $75.0 million as of September 30, 2019. Additionally, we had outstanding letters of credit issued in an aggregate principal amount of $35.5 million, leaving $339.5 million available for borrowing as of September 30, 2019. The outstanding letters of credit as of September 30, 2019 are scheduled to expire in July 2020. Our letters of credit obligations support our various insurance programs and generally renew by their terms each year. The revolving credit facility bears interest at a variable rate based on LIBOR or an alternate base rate at the time of the borrowing and Trinity’s leverage as measured by a consolidated total indebtedness to consolidated EBITDA ratio, and was initially set at LIBOR plus 1.25% (1.50% as of September 30, 2019). A commitment fee accrues on the average daily unused portion of the revolving facility at the rate of 0.175% to 0.30% (0.20% as of September 30, 2019).

The revolving credit facility requires the maintenance of ratios related to minimum interest coverage for the leasing and manufacturing operations and maximum leverage. As of September 30, 2019, we were in compliance with all such financial covenants. Borrowings under the credit facility are guaranteed by certain of our 100%-owned subsidiaries.

TILC Warehouse Loan Facility — The TILC warehouse loan facility was established to finance railcars owned by TILC. During the nine months ended September 30, 2019, we had total borrowings of $663.1 million and total repayments of $492.1 million under the TILC warehouse loan facility, with a remaining outstanding balance of $545.8 million as of September 30, 2019. The entire unused facility amount of $204.2 million was available as of September 30, 2019 based on the amount of warehouse-eligible, unpledged equipment. The warehouse loan facility is a non-recourse obligation and is secured by a portfolio of railcars and operating leases, certain cash reserves, and other assets acquired and owned by the warehouse loan facility trust. The principal and interest of this indebtedness are paid from the cash flows of the underlying leases. Advances under the facility bear interest at a defined index rate plus a margin, for an all-in interest rate of 3.69% at September 30, 2019. Amounts outstanding at maturity, absent renewal, are payable in March 2022.

TRL-2019 — In April 2019, Trinity Rail Leasing 2019 LLC ("TRL-2019"), a Delaware limited liability company and a limited purpose, indirect wholly-owned subsidiary of the Company owned through TILC, issued $528.3 million in Secured Railcar Equipment Notes (the "TRL-2019 Secured Railcar Equipment Notes"). The TRL-2019 Secured Railcar Equipment Notes were issued pursuant to a Master Indenture, dated as of April 10, 2019 between TRL-2019 and U.S. Bank National Association, as indenture trustee. The TRL-2019 Secured Railcar Equipment Notes bear interest at a fixed rate of 3.82%, are payable monthly, and have a stated final maturity date of April 17, 2049. The TRL-2019 Secured Railcar Equipment Notes are obligations of TRL-2019 and are non-recourse to Trinity. The obligations are secured by a portfolio of railcars and operating leases thereon, certain cash reserves, and other assets acquired and owned by TRL-2019. Net proceeds received from the transaction were used to repay approximately $347.0 million of borrowings under TILC’s secured warehouse loan facility, to repay approximately $125.0 million of borrowings under the Company’s revolving credit facility, and for general corporate purposes.

Terms and conditions of other debt, including recourse and non-recourse provisions, are described in Note 11 of our 2018 Annual Report on Form 10-K.

The remaining principal payments under existing debt agreements as of September 30, 2019 are as follows:



	Remaining three months of 2019		2020		2021		2022		2023		Thereafter
	(in millions)
Recourse:
Corporate	$	—	$	—	$	—	$	—	$	75.0	$	400.0
Non-recourse – leasing (Note 6):
2006 secured railcar equipment notes	10.0		29.7		29.1		29.8		16.1		—
2009 secured railcar equipment notes	2.5		6.6		13.4		14.0		11.8		102.4
2010 secured railcar equipment notes	2.6		14.1		20.0		20.9		22.5		171.1
2017 promissory notes	8.3		33.1		33.1		33.2		33.2		494.5
2018 secured railcar equipment notes	5.0		20.0		20.0		20.0		20.0		372.5
TRIHC 2018 secured railcar equipment notes	3.2		10.9		11.9		9.3		11.6		223.5
2019 secured railcar equipment notes	5.3		20.7		22.5		21.5		19.6		431.9
TILC warehouse facility	4.3		17.0		17.0		2.9		—		—
Facility termination payments - TILC warehouse facility	—		—		—		504.6		—		—
TRL 2012 secured railcar equipment notes	4.7		19.3		19.9		19.6		28.5		284.8
TRIP Master Funding secured railcar equipment notes	5.9		32.9		40.4		41.8		37.0		765.8
Total principal payments	$	51.8	$	204.3	$	227.3	$	717.6	$	275.3	$	3,246.5

Subsequent Event — In October 2019, TRL-2019 issued an additional $386.5 million in Secured Railcar Equipment Notes (the "TRL-2019-2 Secured Railcar Equipment Notes"). The TRL-2019-2 Secured Railcar Equipment Notes consisted of two classes of notes with (i) an aggregate principal amount of $106.9 million of TRL-2019's Series 2019-2 Class A-1 Secured Railcar Equipment Notes (the "Class A-1 Notes"), and (ii) an aggregate principal amount of $279.6 million of TRL-2019's Series 2019-2 Class A-2 Secured Railcar Equipment Notes (the “Class A-2 Notes”). The TRL-2019-2 Secured Railcar Equipment Notes were issued pursuant to a Master Indenture, dated April 10, 2019 between TRL-2019 and U.S. Bank National Association, as indenture trustee, as supplemented by a Series 2019-2 Supplement dated as of October 17, 2019. The Class A-1 Notes and Class A-2 Notes bear interest at fixed rates of 2.39% and 3.10%, respectively, are payable monthly, and have a stated final maturity date of October 17, 2049. The TRL-2019-2 Secured Railcar Equipment Notes are obligations of TRL-2019 and are non-recourse to Trinity. The obligations are secured by a portfolio of railcars and operating leases thereon, certain cash reserves, and other assets acquired and owned by TRL-2019. Net proceeds received from the transaction are being used to repay approximately $167 million in outstanding borrowings under the Leasing Group's secured warehouse loan facility, to repay approximately $125 million in outstanding borrowings under the Company's revolving credit facility, and for general corporate purposes.