Debt

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Debt

Debt

The carrying amounts of our debt are as follows:

	March 31, 2024		December 31, 2023
	(in millions)
Corporate – Recourse:
Revolving credit facility	$	—	$	—
Senior notes due 2024, net of unamortized discount of $— and $0.1	400.0		399.9
Senior notes due 2028	400.0		400.0
	800.0		799.9
Less: unamortized debt issuance costs	(5.0)		(5.3)
Total recourse debt	795.0		794.6
Lease fleet – Non-recourse:
Wholly-owned subsidiaries:
Secured railcar equipment notes, net of unamortized discount of $0.2 and $0.2	2,213.6		2,246.7
2017 promissory notes, net of unamortized discount of $3.0 and $3.5	663.1		673.7
TRL-2023 term loan	331.7		334.5
TILC warehouse facility	701.8		529.3
Other equipment financing	51.8		52.3
	3,962.0		3,836.5
Less: unamortized debt issuance costs	(16.0)		(17.3)
	3,946.0		3,819.2
Partially-owned subsidiaries:
Secured railcar equipment notes, net of unamortized discount of $0.1 and $0.1	1,132.8		1,147.8
Less: unamortized debt issuance costs	(6.8)		(7.4)
	1,126.0		1,140.4
Total non-recourse debt	5,072.0		4,959.6
Total debt	$	5,867.0	$	5,754.2

Estimated Fair Value of Debt – The estimated fair values of our 7.75% senior notes due 2028 ("Senior Notes due 2028") and our 4.55% senior notes due 2024 ("Senior Notes due 2024") are based on a quoted market price in a market with little activity (Level 2 input). The estimated fair values of our secured railcar equipment notes are based on our estimate of their fair value using unobservable input values provided by a third party (Level 3 inputs). The respective carrying values of our revolving credit facility, 2017 promissory notes, TRL-2023 term loan, and TILC warehouse facility approximate fair value because the interest rate adjusts to the market interest rate. As of March 31, 2024, we evaluated the fair value of the other equipment financing liability using Level 3 inputs and determined that the carrying value approximates fair value. The estimated fair values of our debt are as follows:

	March 31, 2024		December 31, 2023
	(in millions)
Level 2	$	807.3	$	812.1
Level 3	$	3,174.1	$	3,192.7

Revolving Credit Facility – We have a $600.0 million unsecured corporate revolving credit facility. During the three months ended March 31, 2024, we had total borrowings of $130.0 million and total repayments of $130.0 million under the revolving credit facility. Additionally, we had outstanding letters of credit issued in an aggregate amount of $18.2 million, leaving $581.8 million available for borrowing as of March 31, 2024. The majority of our outstanding letters of credit as of March 31, 2024 are scheduled to expire in October 2024. Our letters of credit obligations support performance bonds related to certain railcar orders. The revolving credit facility bears interest at a variable rate of SOFR plus (1) a benchmark adjustment of 10 basis points and (2) a facility margin of 1.75%, for an all-in interest rate of 7.16% as of March 31, 2024. A commitment fee accrues on the average daily unused portion of the revolving credit facility at the rate of 0.175% to 0.40% (0.25% as of March 31, 2024).

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 March 31, 2024, we were in compliance with all such financial covenants.

TILC Warehouse Loan Facility – TILC has historically maintained a warehouse loan facility to finance railcars owned by TILC. In March 2024, we entered into a new warehouse loan facility with a total commitment amount of $800.0 million, a revolving termination date of March 15, 2027, and a maturity date of March 15, 2028. This warehouse loan facility replaced the prior $1.0 billion warehouse loan facility. We incurred $3.6 million in debt issuance costs, which are recorded in other assets in our Consolidated Balance Sheets as of March 31, 2024, and are being amortized to interest expense over the facility term. During the three months ended March 31, 2024, we had total borrowings of $783.7 million and total repayments of $611.2 million under the current and prior TILC warehouse loan facilities. The entire unused facility amount of $98.2 million was available as of March 31, 2024 based on the amount of warehouse-eligible, unpledged equipment. Advances under the facility bear interest at one-month term SOFR plus a facility margin of 1.75%, for an all-in interest rate of 7.12% at March 31, 2024.

Terms and conditions of our other debt, including recourse and non-recourse provisions and scheduled maturities, are described in Note 9 of our 2023 Annual Report on Form 10-K.