XML 30 R18.htm IDEA: XBRL DOCUMENT v3.21.2
Debt
 9 Months Ended
Sep. 30, 2021
Debt Disclosure [Abstract]  
Debt DebtDebt, net of unamortized original issue discounts or premiums, and unamortized debt issuance costs, consists of the following:
September 30, 2021December 31, 2020
Accounts Receivable Securitization Facility expiring 2022 (1) (2)$832 $634 
$3.75 billion ABL Facility expiring 2024 (1) (3)
1,456 977 
Term loan facility expiring 2025 (1)964 971 
5 7/8 percent Senior Notes due 2026 (4)
— 999 
5 1/2 percent Senior Notes due 2027
994 994 
3 7/8 percent Senior Secured Notes due 2027
743 742 
4 7/8 percent Senior Notes due 2028 (5)
1,656 1,654 
4 7/8 percent Senior Notes due 2028 (5)
4 4 
5 1/4 percent Senior Notes due 2030
743 742 
4 percent Senior Notes due 2030
742 742 
3 7/8 percent Senior Notes due 2031
1,088 1,088 
3 3/4 percent Senior Notes due 2032 (6)
743 — 
Finance leases139 135 
Total debt10,104 9,682 
Less short-term portion (7)(888)(704)
Total long-term debt$9,216 $8,978 
 ___________________

(1)The table below presents financial information associated with our variable rate indebtedness as of and for the nine months ended September 30, 2021. We have borrowed the full available amount under the term loan facility. The principal obligation under the term loan facility is required to be repaid in quarterly installments in an aggregate amount equal to 1.0 percent per annum, with the balance due at the maturity of the facility. The average amount of debt outstanding under the term loan facility decreases slightly each quarter due to the requirement to repay a portion of the principal obligation.
ABL facilityAccounts receivable securitization facilityTerm loan facility
Borrowing capacity, net of letters of credit
$2,223 $68 $— 
Letters of credit
64 
 Interest rate at September 30, 20211.3 %0.8 %1.8 %
Average month-end debt outstanding
946 699 974 
Weighted-average interest rate on average debt outstanding
1.3 %1.1 %1.9 %
Maximum month-end debt outstanding
1,672 866 978 
(2)In June 2021, the accounts receivable securitization facility was amended, primarily to increase the facility size and to extend the maturity date which may be further extended on a 364-day basis by mutual agreement with the purchasers under the facility. The size of the facility, which expires on June 24, 2022, was increased to $900. Borrowings under the accounts receivable securitization facility are permitted only to the extent that the face amount of the receivables in the collateral pool, net of applicable reserves and other deductions, exceeds the outstanding loans. As of September 30, 2021, there were $1.078 billion of receivables, net of applicable reserves and other deductions, in the collateral pool.
(3)In June 2021, the ABL facility was amended, primarily to provide for a separate tranche of revolving commitments in an aggregate principal amount of $175 U.S. dollars to be available to subsidiaries in Australia and New Zealand acquired as part of the General Finance acquisition discussed in note 3 to the condensed consolidated financial statements. The aggregate amount committed under the ABL facility remains unchanged. The increase in the outstanding debt under the ABL facility since December 31, 2020 primarily reflects the use of borrowings under the ABL facility to fund most of the cost of the General Finance acquisition, partially offset by the use of proceeds from operations, net of the funds used for capital expenditures, to reduce borrowings under the facility.
(4)In August 2021, URNA redeemed all of its 5 7/8 percent Senior Notes. Upon redemption, we recognized a loss of $30 in interest expense, net, reflecting the difference between the net carrying amount and the total purchase price of the redeemed notes.
(5)URNA separately issued 4 7/8 percent Senior Notes in August 2017 and in September 2017. Following the issuances, URNA consummated an exchange offer pursuant to which most of the 4 7/8 percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 7/8 percent Senior Notes issued in August 2017.
(6)In August 2021, URNA issued $750 aggregate principal amount of 3 3/4 percent Senior Notes (the “3 3/4 percent Notes”) which are due January 15, 2032. The 3 3/4 percent Notes are unsecured and are guaranteed by Holdings and certain domestic subsidiaries of URNA. The 3 3/4 percent Notes may be redeemed on or after July 15, 2026, at specified redemption prices that range from 101.875 percent in 2026, to 100 percent in 2029 and thereafter, in each case, plus accrued and unpaid interest, if any. In addition, at any time on or prior to July 30, 2024, up to 40 percent of the aggregate principal amount of the 3 3/4 percent Notes may be redeemed with the net cash proceeds of certain equity offerings at a redemption price equal to 103.750 percent of the aggregate principal amount of the notes plus accrued and unpaid interest, if any. The indenture governing the 3 3/4 percent Notes contains certain restrictive covenants, including, among others, limitations on (i) liens and (ii) mergers and consolidations, as well as a requirement to timely file periodic reports with the SEC. Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its subsidiaries to engage in these activities under certain conditions. In addition, the requirements to provide subsidiary guarantees and to make an offer to repurchase the notes upon the occurrence of a change of control will not apply to URNA and its restricted subsidiaries during any period when the 3 3/4 percent Notes are rated investment grade by both Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc., or, in certain circumstances, another rating agency selected by URNA, provided at such time no default under the indenture has occurred and is continuing. The indenture also requires that, in the event of a change of control (as defined in the indenture), URNA must make an offer to purchase all of the then-outstanding 3 3/4 percent Notes tendered at a purchase price in cash equal to 101 percent of the principal amount thereof, plus accrued and unpaid interest, if any, thereon.
(7)As of September 30, 2021, our short-term debt primarily reflects $832 of borrowings under our accounts receivable securitization facility.
Loan Covenants and Compliance
As of September 30, 2021, we were in compliance with the covenants and other provisions of the ABL, accounts receivable securitization and term loan facilities and the senior notes. Any failure to be in compliance with any material provision or covenant of these agreements could have a material adverse effect on our liquidity and operations.
The only financial covenant that currently exists under the ABL facility is the fixed charge coverage ratio. Subject to certain limited exceptions specified in the ABL facility, the fixed charge coverage ratio covenant under the ABL facility will only apply in the future if specified availability under the ABL facility falls below 10 percent of the maximum revolver amount under the ABL facility. When certain conditions are met, cash and cash equivalents and borrowing base collateral in excess of the ABL facility size may be included when calculating specified availability under the ABL facility. As of September 30, 2021, specified availability under the ABL facility exceeded the required threshold and, as a result, this financial covenant was inapplicable. Under our accounts receivable securitization facility, we are required, among other things, to maintain certain financial tests relating to: (i) the default ratio, (ii) the delinquency ratio, (iii) the dilution ratio and (iv) days sales outstanding. The accounts receivable securitization facility also requires us to comply with the fixed charge coverage ratio under the ABL facility, to the extent the ratio is applicable under the ABL facility.