Debt

3 Months Ended

Mar. 31, 2012

Debt [Abstract]

Debt

Note 9. Debt

The following table summarizes the components of debt as of March 31, 2012 and December 31, 2011:

	March 31,			December 31,
	2012			2011
				(as reported)
	(in millions)
Manufacturing/Corporate – Recourse:
Revolving credit facility	$	—		$	—
Convertible subordinated notes		450.0			450.0
Less: unamortized discount		(96.8	)		(99.8	)
		353.2			350.2
Other		6.1			4.2
		359.3			354.4
Leasing – Recourse:
Capital lease obligations		47.9			48.6
Term loan		54.0			54.7
		101.9			103.3
Total recourse debt		461.2			457.7
Leasing – Non-recourse:
2006 secured railcar equipment notes		266.0			269.3
Promissory notes		459.3			465.5
2009 secured railcar equipment notes		216.2			218.4
2010 secured railcar equipment notes		351.3			354.3
TILC warehouse facility		282.7			308.5
TRIP Holdings senior secured notes:
Total outstanding		170.0			170.0
Less: owned by Trinity		(108.8	)		(108.8	)
		61.2			61.2
TRIP Master Funding secured railcar equipment notes		829.6			840.0
Total non-recourse debt		2,466.3			2,517.2
Total debt	$	2,927.5		$	2,974.9

We have a $425.0 million unsecured revolving credit facility that matures on October 20, 2016. As of March 31, 2012, we had letters of credit issued under our revolving credit facility in an aggregate principal amount of $72.6 million, leaving $352.4 million available for borrowing. Other than these letters of credit, there were no borrowings under our revolving credit facility as of March 31, 2012, or for the three month period then ended. Of the outstanding letters of credit as of March 31, 2012, a total of $0.4 million is expected to expire in 2012 and the remainder in 2013. The majority of our letters of credit obligations supports the Company’s various insurance programs and generally renews each year. Trinity’s revolving credit facility requires the maintenance of ratios related to minimum interest coverage for the leasing and manufacturing operations and maximum leverage. Borrowings under the amended credit facility bear interest at Libor plus 150.0 basis points or prime plus 50.0 basis points. As of March 31, 2012, we were in compliance with all such financial covenants.

The Company’s 3 7/8% convertible subordinated notes are recorded net of unamortized discount to reflect their underlying economics by capturing the value of the conversion option as borrowing costs. As of March 31, 2012 and December 31, 2011, capital in excess of par value included $92.8 million related to the estimated value of the Convertible Subordinated Notes’ conversion options, in accordance with ASC 470-20. Debt discount recorded in the consolidated balance sheet is being amortized through June 1, 2018 to yield an effective annual interest rate of 8.42% based upon the estimated market interest rate for comparable non-convertible debt as of the issuance date of the Convertible Subordinated Notes. Total interest expense recognized on the Convertible Subordinated Notes for the three months ended March 31, 2012 and 2011 is as follows:

	Three Months Ended March 31,
	2012		2011
	(in millions)
Coupon rate interest	$	4.4	$	4.4
Amortized debt discount		3.0		2.7
	$	7.4	$	7.1

At March 31, 2012, the Convertible Subordinated Notes were convertible at a price of $51.36 per share resulting in 8,761,682 issuable shares. As of March 31, 2012, if the Convertible Subordinated Notes had been converted, no shares would have been issued since the trading price of the Company’s common stock was below the conversion price of the Convertible Subordinated Notes. The Company has not entered into any derivatives transactions associated with these notes.

The $475.0 million TILC warehouse loan facility, established to finance railcars owned by TILC, had $282.7 million outstanding and $192.3 million available as of March 31, 2012. The warehouse loan is a non-recourse obligation secured by a portfolio of railcars and operating leases, certain cash reserves, and other assets acquired and owned by the warehouse loan facility. 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 2.25% at March 31, 2012. In February 2011, the warehouse loan facility was renewed for an additional two years and now matures in February 2013. Amounts outstanding at maturity, absent renewal, will be payable in three installments in August 2013, February 2014, and August 2014.

Terms and conditions of other debt, including recourse and non-recourse provisions, are described in Note 11 of the December 31, 2011 Consolidated Financial Statements filed on Form 10-K.

The remaining principal payments under existing debt agreements as of March 31, 2012 are as follows:

	Remaining nine months of 2012		2013		2014			2015		2016		Thereafter
	(in millions)
Recourse:
Manufacturing/Corporate	$	1.3	$	1.7	$	2.4		$	0.2	$	0.2	$	450.3
Leasing – capital lease obligations (Note 4)		2.1		2.9		3.1			3.3		3.5		33.0
Leasing – term loan (Note 4)		2.1		3.0		3.3			3.5		42.1		—
Non-recourse – leasing (Note 4):
2006 secured railcar equipment notes		10.2		15.1		16.9			18.6		21.9		183.3
Promissory notes		19.5		29.0		26.2			23.2		361.4		—
2009 secured railcar equipment notes		7.0		10.2		9.9			9.6		6.5		173.0
2010 secured railcar equipment notes		9.7		14.6		14.0			15.3		15.0		282.7
TILC warehouse facility		6.4		7.8		4.3			—		—		—
TRIP Holdings senior secured notes:
Total outstanding		—		—		170.0			—		—		—
Less: owned by Trinity		—		—		(108.8	)		—		—		—
						61.2
TRIP Master Funding secured railcar equipment notes		30.6		41.1		40.2			35.9		29.4		652.4
Facility termination payments:
TILC warehouse facility		—		87.6		176.6			—		—		—
Total principal payments	$	88.9	$	213.0	$	358.1		$	109.6	$	480.0	$	1,774.7