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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
(State or other jurisdiction of
incorporation or organization)
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20-1796526
(I.R.S. Employer
Identification Number)
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100 Manhattanville Road, Purchase, New York
(Address of principal executive office)
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10577-2135
(Zip Code)
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(914) 251-9000
(Registrant's telephone number including area code)
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Title of Each Class
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Name of Exchange On Which Registered
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Common stock, $0.001 par value per share
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The New York Stock Exchange
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Large Accelerated Filer
ý
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Accelerated Filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
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DOCUMENTS INCORPORATED BY REFERENCE
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Part of Form 10-K
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Document Incorporated by Reference
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Part III, Items 10, 11, 12, 13, and 14
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The information required by Item 10, 11, 12, 13, and 14, are incorporated herein by reference to an amendment to this Form 10-K to be filed by the Company not later than 120 days after the end of the fiscal year covered by this report.
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Page No.
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Item 9B
.
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||
•
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Equipment leasing
- We own, lease and ultimately dispose of containers and chassis from our lease fleet, as well as manage containers owned by third parties. The Equipment leasing segment contributed
97.6%
,
96.7%
, and
96.1%
of the sum of our Total leasing revenue, Trading margin, and Net (loss) gain on sale of leasing equipment for the years ended December 31,
2015
,
2014
, and
2013
, respectively.
|
•
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Equipment trading
- We purchase containers from shipping line customers and other sellers of containers, and resell these containers to container retailers and users of containers for storage or one-way shipment. The Equipment trading segment contributed
2.4%
,
3.3%
, and
3.9%
of the sum of our Total leasing revenue, Trading margin, and Net gain on sale of leasing equipment for the years ended December 31,
2015
,
2014
, and
2013
, respectively.
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Lease Portfolio
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December 31, 2015
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Long-term leases
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68.7
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%
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Finance leases
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7.7
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Service leases
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15.7
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Expired long-term leases (units on-hire)
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7.9
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Total
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100.0
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%
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•
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Dry Containers.
A dry container is essentially a steel constructed box with a set of doors on one end. Dry containers come in lengths of 20, 40 or 45 feet. They are 8 feet wide, and either 8½
or 9½ feet tall. Dry containers are the least expensive and most widely used type of intermodal container and are used to carry general cargo such as manufactured component parts, consumer staples, electronics and apparel.
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•
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Refrigerated Containers.
Refrigerated containers include an integrated cooling machine and an insulated container, come in lengths of 20 or 40 feet, are 8 feet wide, and are either 8½
or 9½ feet tall. These containers are typically used to carry perishable cargo such as fresh and frozen produce.
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•
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Special Containers.
Most of our special containers are open top and flat rack containers. Open top containers come in similar sizes as dry containers, but do not have a fixed roof. Flat rack containers come in varying sizes and are steel platforms with folding ends and no fixed sides. Open top and flat rack containers are generally used to move heavy or bulky cargos, such as marble slabs, steel coils or factory components, that cannot be easily loaded on a fork lift through the doors of a standard container.
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•
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Tank Containers.
Tank containers are stainless steel cylindrical tanks enclosed in rectangular steel frames with the same outside dimensions as 20 foot dry containers. They carry bulk liquids such as chemicals.
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•
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Chassis.
An intermodal chassis is a rectangular, wheeled steel frame, generally 23½, 40 or 45 feet in length, built specifically for the purpose of transporting intermodal containers domestically. Longer sized chassis, designed solely to accommodate domestic containers, can be up to 53 feet in length. Once mounted, the chassis and container are the functional equivalent of a trailer. When mounted on a chassis, the container may be trucked either to its destination or to a railroad terminal for loading onto a rail car. Our chassis are primarily used in the United States.
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•
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Operating Flexibility.
The timing, location and daily volume of cargo movements for a shipping line are often unpredictable. Leasing containers and chassis helps the shipping lines manage this uncertainty and minimizes the requirement for large inventory buffers by allowing them to pick-up leased equipment on short notice.
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•
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Fleet Size and Mix Flexibility.
The drop-off flexibility included in container and chassis operating leases allows shipping lines to more quickly adjust the size of their fleets and the mix of container types in their fleets as their trade volumes and patterns change due to seasonality, market changes or changes in company strategies.
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•
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Alternative Source of Financing.
Container and chassis leases provide an additional source of equipment financing to help shipping lines manage the high level of investment required to maintain pace with the rapid growth of the asset intensive container shipping industry.
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•
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the available supply and prices of new and used containers;
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•
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changes in economic conditions, the operating efficiency of our customers and competitive pressures in the shipping industry;
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•
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the availability and terms of equipment financing for our customers;
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•
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fluctuations in interest rates and foreign currency values;
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•
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import/export tariffs and restrictions;
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•
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customs procedures;
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•
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foreign exchange controls; and
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•
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other governmental regulations and political or economic factors that are inherently unpredictable and may be beyond our control.
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•
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making it more difficult for us to satisfy our obligations with respect to our debt facilities. Any failure to comply with such obligations, including a failure to make timely interest or principal payments, or a breach of financial or other restrictive covenants, could result in an event of default under the agreements governing such indebtedness, which could lead to, among other things, an acceleration of our indebtedness or foreclosure on the assets securing our indebtedness and which could have a material adverse effect on our business, financial condition, future prospects and solvency;
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•
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requiring us to dedicate a substantial portion of our cash flow from operations to make payments on our debt, thereby reducing funds available for operations, capital expenditures, future business opportunities and other purposes;
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•
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limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
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•
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limiting our ability to borrow additional funds, or to sell assets to raise funds, if needed, for working capital, capital expenditures, acquisitions or other purposes;
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•
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making it difficult for us to pay dividends on our common shares or repurchase our common shares;
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•
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increasing our vulnerability to general adverse economic and industry conditions, including changes in interest rates; and
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•
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placing us at a competitive disadvantage compared to our competitors having less debt.
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•
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incur additional indebtedness;
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•
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pay dividends on or redeem or repurchase our shares;
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•
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issue additional capital stock of TAL and our subsidiaries;
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•
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make loans and investments;
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•
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create liens;
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•
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sell certain assets or merge with or into other companies;
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•
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enter into certain transactions with shareholders and affiliates;
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•
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cause our subsidiaries to make dividends, distributions and other payments to TAL; and
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•
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otherwise conduct necessary corporate activities.
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•
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regional or local economic downturns;
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•
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changes in governmental policy or regulation;
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•
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restrictions on the transfer of funds into or out of countries in which we operate;
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•
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compliance with U.S. Treasury sanctions regulations restricting doing business with certain nations or specially designated nationals;
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•
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import and export duties and quotas;
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•
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domestic and foreign customs and tariffs;
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•
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international incidents;
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•
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military outbreaks;
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•
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government instability;
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•
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nationalization of foreign assets;
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•
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government protectionism;
|
•
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compliance with export controls, including those of the U.S. Department of Commerce;
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•
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compliance with import procedures and controls, including those of the U.S. Department of Homeland Security;
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•
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potentially negative consequences from changes in tax laws;
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•
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requirements relating to withholding taxes on remittances and other payments by subsidiaries;
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•
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labor or other disruptions at key ports;
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•
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difficulty in staffing and managing widespread operations;
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•
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difficulty in registering intellectual property or inadequate intellectual property protection in foreign jurisdictions; and
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•
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restrictions on our ability to own or operate subsidiaries, make investments or acquire new businesses in these jurisdictions.
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•
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variations in our financial results;
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•
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changes in financial estimates or investment recommendations by securities analysts following our business;
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•
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the public’s response to our press releases, other public announcements and filings with the Securities and Exchange Commission;
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•
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changes in accounting standards, policies, guidance or interpretations or principles;
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•
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future sales of common shares by us and our directors, officers and significant shareholders;
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•
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announcements of technological innovations or enhanced or new products by us or our competitors;
|
•
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our failure to achieve operating results consistent with securities analysts’ projections;
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•
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the operating and stock price performance of other companies that investors may deem comparable to us;
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•
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changes in our dividend policy and share repurchase programs;
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•
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fluctuations in the worldwide equity markets;
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•
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recruitment or departure of key personnel;
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•
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our failure to timely address changing customer preferences;
|
•
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broad market and industry factors; and
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•
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other events or factors, including those resulting from war, incidents of terrorism or responses to such events.
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•
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dilution of shareholders’ ownership interest of TAL if new shares are issued to fund an acquisition;
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•
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potential disruption of our ongoing business and distraction of management;
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•
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difficulty with integration of personnel and financial and other systems;
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•
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hiring additional management and other critical personnel; and
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•
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increasing the scope, geographic diversity and complexity of our operations.
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•
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TAL may be required, under certain specified circumstances, to pay Triton a termination fee of $19,484,275 or to reimburse the documented, out-of-pocket fees, costs and expenses incurred by Triton, Holdco, the Merger Subs and their subsidiaries in connection with the Transaction Agreement and the transactions contemplated thereby (up to $3,500,000);
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•
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under the Transaction Agreement, TAL is subject to certain restrictions on the conduct of its business prior to completing the mergers which may adversely affect its ability to execute certain of its business strategies; and
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•
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matters relating to the mergers may require substantial commitments of time and resources by TAL management, which could otherwise have been devoted to other opportunities that may have been beneficial to TAL as an independent company.
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•
|
an estimated $30 million to $40 million in severance costs;
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•
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approximately $35 million of costs to maintain employee morale and to retain key employees of which approximately $25 million is related to a retention plan established in connection with the acquisition of Triton in 2011 by Warburg Pincus and Vestar. As of September 30, 2015, $18.2 million related to the Triton 2011 retention plan has been accrued in Triton’s financial statements; and
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•
|
an estimated $30 million to $35 million of fees and expenses relating to legal, accounting and other transaction and advisory fees associated with the mergers.
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•
|
75% or more of Holdco’s gross income in a taxable year is passive income; or
|
•
|
the average percentage of Holdco’s assets (which includes cash) by value in a taxable year which produce or are held for the production of passive income is at least 50%.
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|
High
|
|
Low
|
2015:
|
|
|
|
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Fourth Quarter
|
|
$20.90
|
|
$13.11
|
Third Quarter
|
|
$32.49
|
|
$13.27
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Second Quarter
|
|
$42.93
|
|
$31.22
|
First Quarter
|
|
$43.87
|
|
$39.19
|
2014:
|
|
|
|
|
Fourth Quarter
|
|
$45.91
|
|
$37.67
|
Third Quarter
|
|
$47.60
|
|
$41.09
|
Second Quarter
|
|
$45.63
|
|
$41.18
|
First Quarter
|
|
$57.60
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|
$40.35
|
|
Base Period as of
|
|
INDEXED RETURNS FOR THE YEARS ENDED
|
||||||||
Company / Index
|
12/31/2010
|
|
12/31/2011
|
|
12/31/2012
|
|
12/31/2013
|
|
12/31/2014
|
|
12/31/2015
|
TAL International Group, Inc.
|
100.00
|
|
99.62
|
|
134.58
|
|
228.22
|
|
187.52
|
|
73.47
|
S&P 500 Index
|
100.00
|
|
102.11
|
|
118.45
|
|
156.81
|
|
178.28
|
|
180.78
|
Russell 2000 Index
|
100.00
|
|
95.82
|
|
111.49
|
|
154.77
|
|
162.33
|
|
155.17
|
Record Date
|
Payment Date
|
|
Aggregate
Payment |
|
Per Share
Payment |
December 2, 2015
|
December 23, 2015
|
|
$14.8 Million
|
|
$0.45
|
September 2, 2015
|
September 23, 2015
|
|
$23.7 Million
|
|
$0.72
|
June 3, 2015
|
June 24, 2015
|
|
$23.7 Million
|
|
$0.72
|
March 3, 2015
|
March 24, 2015
|
|
$23.7 Million
|
|
$0.72
|
December 2, 2014
|
December 23, 2014
|
|
$23.8 Million
|
|
$0.72
|
September 3, 2014
|
September 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
June 3, 2014
|
June 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
March 3, 2014
|
March 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
|
Year Ended December 31,
(Dollars and shares in thousands, except per share data) |
||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Statements of Income Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Leasing revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating leases
|
$
|
591,665
|
|
|
$
|
573,778
|
|
|
$
|
552,640
|
|
|
$
|
511,189
|
|
|
$
|
434,668
|
|
Finance leases
|
15,192
|
|
|
18,355
|
|
|
14,728
|
|
|
13,781
|
|
|
16,394
|
|
|||||
Other revenues
|
1,147
|
|
|
1,873
|
|
|
2,485
|
|
|
3,227
|
|
|
3,301
|
|
|||||
Total leasing revenues
|
608,004
|
|
|
594,006
|
|
|
569,853
|
|
|
528,197
|
|
|
454,363
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Equipment trading revenues
|
62,195
|
|
|
56,436
|
|
|
73,004
|
|
|
60,975
|
|
|
62,324
|
|
|||||
Equipment trading expenses
|
(58,001
|
)
|
|
(49,246
|
)
|
|
(62,726
|
)
|
|
(53,431
|
)
|
|
(51,330
|
)
|
|||||
Trading margin
|
4,194
|
|
|
7,190
|
|
|
10,278
|
|
|
7,544
|
|
|
10,994
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net (loss) gain on sale of leasing equipment
|
(13,646
|
)
|
|
6,987
|
|
|
26,751
|
|
|
44,509
|
|
|
51,969
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization(1)
|
242,538
|
|
|
224,753
|
|
|
205,073
|
|
|
193,466
|
|
|
152,576
|
|
|||||
Direct operating expenses
|
48,902
|
|
|
33,076
|
|
|
27,142
|
|
|
25,039
|
|
|
18,157
|
|
|||||
Administrative expenses
|
51,154
|
|
|
45,399
|
|
|
44,197
|
|
|
43,991
|
|
|
42,727
|
|
|||||
Provision (reversal) for doubtful accounts
|
133
|
|
|
212
|
|
|
2,827
|
|
|
(208
|
)
|
|
162
|
|
|||||
Total operating expenses
|
342,727
|
|
|
303,440
|
|
|
279,239
|
|
|
262,288
|
|
|
213,622
|
|
|||||
Operating income
|
255,825
|
|
|
304,743
|
|
|
327,643
|
|
|
317,962
|
|
|
303,704
|
|
|||||
Other expenses (income):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest and debt expense
|
118,280
|
|
|
109,265
|
|
|
111,725
|
|
|
114,629
|
|
|
105,470
|
|
|||||
Write-off of deferred financing costs
|
895
|
|
|
5,192
|
|
|
4,000
|
|
|
—
|
|
|
1,143
|
|
|||||
Net loss (gain) on interest rate swaps(2)
|
205
|
|
|
780
|
|
|
(8,947
|
)
|
|
2,469
|
|
|
27,354
|
|
|||||
Total other expenses
|
119,380
|
|
|
115,237
|
|
|
106,778
|
|
|
117,098
|
|
|
133,967
|
|
|||||
Income before income taxes
|
136,445
|
|
|
189,506
|
|
|
220,865
|
|
|
200,864
|
|
|
169,737
|
|
|||||
Income tax expense
|
48,233
|
|
|
65,461
|
|
|
77,699
|
|
|
70,732
|
|
|
60,013
|
|
|||||
Net income
|
$
|
88,212
|
|
|
$
|
124,045
|
|
|
$
|
143,166
|
|
|
$
|
130,132
|
|
|
$
|
109,724
|
|
Earnings Per Share Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic income per share applicable to common stockholders
|
$
|
2.68
|
|
|
$
|
3.70
|
|
|
$
|
4.28
|
|
|
$
|
3.92
|
|
|
$
|
3.39
|
|
Diluted income per share applicable to common stockholders
|
$
|
2.67
|
|
|
$
|
3.68
|
|
|
$
|
4.25
|
|
|
$
|
3.87
|
|
|
$
|
3.34
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
32,861
|
|
|
33,482
|
|
|
33,483
|
|
|
33,224
|
|
|
32,414
|
|
|||||
Diluted
|
32,979
|
|
|
33,664
|
|
|
33,694
|
|
|
33,623
|
|
|
32,821
|
|
|||||
Cash dividends paid per common share
|
$
|
2.61
|
|
|
$
|
2.88
|
|
|
$
|
2.68
|
|
|
$
|
2.35
|
|
|
$
|
1.99
|
|
(1)
|
Depreciation expense was reduced by $5.2 million quarterly ($3.4 million after tax or $0.10 per diluted share) with the quarter ended December 31, 2012 as the result of the increase in residual value estimates included in the Company's depreciation policy (see Note 2 in the Notes to Consolidated Financial Statements).
|
(2)
|
Net losses and gains on interest rate swaps are primarily due to changes in interest rates, and reflect changes in the fair value of interest rate swaps not designated as cash flow hedges.
|
|
As of December 31,
(In thousands, except fleet data) |
||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Balance Sheet Data (end of period):
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (including restricted cash)
|
$
|
89,209
|
|
|
$
|
114,781
|
|
|
$
|
98,001
|
|
|
$
|
101,680
|
|
|
$
|
175,343
|
|
Accounts receivable, net
|
95,709
|
|
|
85,681
|
|
|
74,174
|
|
|
71,363
|
|
|
56,491
|
|
|||||
Revenue earning assets, net
|
4,160,928
|
|
|
3,953,764
|
|
|
3,730,122
|
|
|
3,418,446
|
|
|
2,857,233
|
|
|||||
Total assets
|
4,434,076
|
|
|
4,242,047
|
|
|
4,016,209
|
|
|
3,674,744
|
|
|
3,173,275
|
|
|||||
Debt, net of unamortized deferred financing costs
|
3,216,488
|
|
|
3,007,905
|
|
|
2,788,846
|
|
|
2,577,565
|
|
|
2,211,557
|
|
|||||
Stockholders' equity
|
665,012
|
|
|
666,528
|
|
|
691,918
|
|
|
615,975
|
|
|
562,802
|
|
|||||
Other Financial Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
704,178
|
|
|
670,529
|
|
|
660,492
|
|
|
831,826
|
|
|
815,730
|
|
|||||
Proceeds from sale of equipment leasing fleet, net of selling costs
|
125,525
|
|
|
165,990
|
|
|
140,724
|
|
|
133,367
|
|
|
123,659
|
|
|||||
Selected Fleet Data(1)(2):
|
|
|
|
|
|
|
|
|
|
||||||||||
Dry container units
|
1,351,170
|
|
|
1,189,707
|
|
|
1,105,433
|
|
|
1,021,642
|
|
|
847,902
|
|
|||||
Refrigerated container units
|
70,505
|
|
|
65,010
|
|
|
64,030
|
|
|
57,229
|
|
|
50,751
|
|
|||||
Special container units
|
56,118
|
|
|
56,180
|
|
|
56,761
|
|
|
57,198
|
|
|
48,039
|
|
|||||
Tank container units
|
11,243
|
|
|
9,282
|
|
|
8,100
|
|
|
6,608
|
|
|
5,396
|
|
|||||
Chassis
|
21,216
|
|
|
19,116
|
|
|
13,724
|
|
|
13,146
|
|
|
10,789
|
|
|||||
Equipment trading units
|
21,135
|
|
|
32,448
|
|
|
40,374
|
|
|
45,860
|
|
|
46,767
|
|
|||||
Total container units/chassis
|
1,531,387
|
|
|
1,371,743
|
|
|
1,288,422
|
|
|
1,201,683
|
|
|
1,009,644
|
|
|||||
Total containers/chassis in TEU
|
2,512,667
|
|
|
2,249,619
|
|
|
2,113,215
|
|
|
1,957,776
|
|
|
1,645,868
|
|
|||||
Total containers/chassis in cost equivalent units(3)
|
3,105,911
|
|
|
2,778,284
|
|
|
2,640,743
|
|
|
2,404,516
|
|
|
2,044,012
|
|
|||||
Average utilization %(4)
|
96.0
|
%
|
|
97.6
|
%
|
|
97.4
|
%
|
|
97.9
|
%
|
|
98.7
|
%
|
(1)
|
Includes both owned and managed units, as well as units on finance leases.
|
(2)
|
Calculated as of the end of the relevant period.
|
(3)
|
The Company has included total fleet count information based on cost equivalent units (CEU). CEU is a ratio used to convert the actual number of containers in the Company's fleet to a figure based on the relative purchase price of various equipment types to that of a 20 foot dry container. For example, the CEU ratio for a 40 foot standard height dry container is 1.6, and a 40 foot high cube refrigerated container is 10.0. These CEU ratios are from the Company's debt agreements and may differ slightly from CEU ratios used by others in the industry.
|
(4)
|
Average utilization is computed by dividing total units on lease (in CEU) by the total units in the Company's fleet (in CEU) excluding new units not yet leased and off-hire units designated for sale.
|
•
|
Equipment leasing—we own, lease and ultimately dispose of containers and chassis from our lease fleet, as well as manage containers owned by third parties.
|
•
|
Equipment trading—we purchase containers from shipping line customers, and other sellers of containers, and resell these containers to container retailers and users of containers for storage or one-way shipment.
|
|
Equipment Fleet in Units (1)
|
|
Equipment Fleet in TEU(1)
|
||||||||||||||
|
December 31, 2015
|
|
December 31, 2014
|
|
December 31, 2013
|
|
December 31, 2015
|
|
December 31, 2014
|
|
December 31, 2013
|
||||||
Dry
|
1,351,170
|
|
|
1,189,707
|
|
|
1,105,433
|
|
|
2,190,940
|
|
|
1,928,482
|
|
|
1,790,975
|
|
Refrigerated
|
70,505
|
|
|
65,010
|
|
|
64,030
|
|
|
134,204
|
|
|
123,342
|
|
|
122,579
|
|
Special
|
56,118
|
|
|
56,180
|
|
|
56,761
|
|
|
102,081
|
|
|
102,065
|
|
|
101,954
|
|
Tank
|
11,243
|
|
|
9,282
|
|
|
8,100
|
|
|
11,243
|
|
|
9,282
|
|
|
8,100
|
|
Chassis
|
21,216
|
|
|
19,116
|
|
|
13,724
|
|
|
38,210
|
|
|
33,877
|
|
|
24,505
|
|
Equipment leasing fleet
|
1,510,252
|
|
|
1,339,295
|
|
|
1,248,048
|
|
|
2,476,678
|
|
|
2,197,048
|
|
|
2,048,113
|
|
Equipment trading fleet
|
21,135
|
|
|
32,448
|
|
|
40,374
|
|
|
35,989
|
|
|
52,571
|
|
|
65,102
|
|
Total
|
1,531,387
|
|
|
1,371,743
|
|
|
1,288,422
|
|
|
2,512,667
|
|
|
2,249,619
|
|
|
2,113,215
|
|
|
Equipment Fleet in CEU(1)
|
|||||||
|
December 31, 2015
|
|
December 31, 2014
|
|
December 31, 2013
|
|||
Operating leases
|
2,801,607
|
|
|
2,475,518
|
|
|
2,290,636
|
|
Finance leases
|
197,225
|
|
|
197,537
|
|
|
211,365
|
|
Equipment trading fleet
|
107,079
|
|
|
105,229
|
|
|
138,742
|
|
Total
|
3,105,911
|
|
|
2,778,284
|
|
|
2,640,743
|
|
(1)
|
As of
December 31, 2015
, the Company had
1.0%
,
1.0%
, and
0.7%
of managed equipment in units, TEU, and CEU, respectively.
|
Equipment Type
|
Percent of
total fleet in units |
|
Percent of total fleet in CEU
|
|
Percent of
leasing revenues |
|||
Dry
|
88.2
|
%
|
|
61.6
|
%
|
|
65.4
|
%
|
Refrigerated
|
4.6
|
|
|
22.1
|
|
|
19.8
|
|
Special
|
3.7
|
|
|
4.4
|
|
|
6.7
|
|
Tank
|
0.7
|
|
|
5.8
|
|
|
3.4
|
|
Chassis
|
1.4
|
|
|
2.7
|
|
|
3.1
|
|
Equipment leasing fleet
|
98.6
|
|
|
96.6
|
|
|
98.4
|
|
Equipment trading fleet
|
1.4
|
|
|
3.4
|
|
|
1.6
|
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Lease Portfolio
|
December 31,
2015 |
|
December 31,
2014 |
|
December 31,
2013 |
|||
Long-term leases
|
68.7
|
%
|
|
68.9
|
%
|
|
68.0
|
%
|
Finance leases
|
7.7
|
|
|
8.0
|
|
|
9.2
|
|
Service leases
|
15.7
|
|
|
17.7
|
|
|
18.0
|
|
Expired long-term leases (units remaining on-hire)
|
7.9
|
|
|
5.4
|
|
|
4.8
|
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
Quarter Ended
|
||||||
Average Utilization
|
|
Year Ended December 31,
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
2015
|
|
96.0%
|
|
93.7%
|
|
95.8%
|
|
97.1%
|
|
97.9%
|
2014
|
|
97.6%
|
|
98.1%
|
|
97.9%
|
|
97.3%
|
|
97.1%
|
2013
|
|
97.4%
|
|
97.0%
|
|
97.3%
|
|
97.5%
|
|
97.7%
|
|
|
|
Quarter Ended
|
||||||
Ending Utilization
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
2015
|
|
93.0%
|
|
94.7%
|
|
96.6%
|
|
97.7%
|
|
2014
|
|
98.1%
|
|
98.1%
|
|
97.7%
|
|
96.9%
|
|
2013
|
|
97.2%
|
|
97.0%
|
|
97.5%
|
|
97.6%
|
(1)
|
Utilization is computed by dividing our total units on lease (in CEU) by the total units in our fleet (in CEU) excluding new units not yet leased and off-hire units designated for sale.
|
Record Date
|
Payment Date
|
|
Aggregate
Payment
|
|
Per Share
Payment
|
December 2, 2015
|
December 23, 2015
|
|
$14.8 Million
|
|
$0.45
|
September 2, 2015
|
September 23, 2015
|
|
$23.7 Million
|
|
$0.72
|
June 3, 2015
|
June 24, 2015
|
|
$23.7 Million
|
|
$0.72
|
March 3, 2015
|
March 24, 2015
|
|
$23.7 Million
|
|
$0.72
|
December 2, 2014
|
December 23, 2014
|
|
$23.8 Million
|
|
$0.72
|
September 3, 2014
|
September 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
June 3, 2014
|
June 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
March 3, 2014
|
March 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Leasing revenues:
|
|
|
|
|
|
||||||
Operating leases
|
$
|
591,665
|
|
|
$
|
573,778
|
|
|
$
|
552,640
|
|
Finance leases
|
15,192
|
|
|
18,355
|
|
|
14,728
|
|
|||
Other revenues
|
1,147
|
|
|
1,873
|
|
|
2,485
|
|
|||
Total leasing revenues
|
608,004
|
|
|
594,006
|
|
|
569,853
|
|
|||
|
|
|
|
|
|
||||||
Equipment trading revenues
|
62,195
|
|
|
56,436
|
|
|
73,004
|
|
|||
Equipment trading expenses
|
(58,001
|
)
|
|
(49,246
|
)
|
|
(62,726
|
)
|
|||
Trading margin
|
4,194
|
|
|
7,190
|
|
|
10,278
|
|
|||
|
|
|
|
|
|
||||||
Net (loss) gain on sale of leasing equipment
|
(13,646
|
)
|
|
6,987
|
|
|
26,751
|
|
|||
|
|
|
|
|
|
||||||
Operating expenses:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
242,538
|
|
|
224,753
|
|
|
205,073
|
|
|||
Direct operating expenses
|
48,902
|
|
|
33,076
|
|
|
27,142
|
|
|||
Administrative expenses
|
51,154
|
|
|
45,399
|
|
|
44,197
|
|
|||
Provision for doubtful accounts
|
133
|
|
|
212
|
|
|
2,827
|
|
|||
Total operating expenses
|
342,727
|
|
|
303,440
|
|
|
279,239
|
|
|||
Operating income
|
255,825
|
|
|
304,743
|
|
|
327,643
|
|
|||
Other expenses:
|
|
|
|
|
|
||||||
Interest and debt expense
|
118,280
|
|
|
109,265
|
|
|
111,725
|
|
|||
Write-off of deferred financing costs
|
895
|
|
|
5,192
|
|
|
4,000
|
|
|||
Net loss (gain) on interest rate swaps
|
205
|
|
|
780
|
|
|
(8,947
|
)
|
|||
Total other expenses
|
119,380
|
|
|
115,237
|
|
|
106,778
|
|
|||
Income before income taxes
|
136,445
|
|
|
189,506
|
|
|
220,865
|
|
|||
Income tax expense
|
48,233
|
|
|
65,461
|
|
|
77,699
|
|
|||
Net income
|
$
|
88,212
|
|
|
$
|
124,045
|
|
|
$
|
143,166
|
|
|
Year Ended December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Leasing revenues:
|
|
|
|
||||
Operating lease revenues:
|
|
|
|
||||
Per diem revenue
|
$
|
553,155
|
|
|
$
|
545,561
|
|
Fee and ancillary lease revenue
|
38,510
|
|
|
28,217
|
|
||
Total operating lease revenue
|
591,665
|
|
|
573,778
|
|
||
Finance lease revenue
|
15,192
|
|
|
18,355
|
|
||
Other revenues
|
1,147
|
|
|
1,873
|
|
||
Total leasing revenues
|
$
|
608,004
|
|
|
$
|
594,006
|
|
•
|
$31.9 million
increase
due to
an increase
of approximately
149,700
CEU in the average number of units on-hire under operating leases; partially offset by a
|
•
|
$24.3 million
decrease
due to a
5.3%
decrease in average CEU per diem rates.
|
|
Year Ended December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(in thousands)
|
||||||
Equipment trading revenues
|
$
|
62,195
|
|
|
$
|
56,436
|
|
Equipment trading expenses
|
(58,001
|
)
|
|
(49,246
|
)
|
||
Equipment trading margin
|
$
|
4,194
|
|
|
$
|
7,190
|
|
|
Year Ended December 31,
|
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Leasing revenues:
|
|
|
|
||||
Operating lease revenues:
|
|
|
|
||||
Per diem revenue
|
$
|
545,561
|
|
|
$
|
528,499
|
|
Fee and ancillary lease revenue
|
28,217
|
|
|
24,141
|
|
||
Total operating lease revenue
|
573,778
|
|
|
552,640
|
|
||
Finance lease revenue
|
18,355
|
|
|
14,728
|
|
||
Other revenues
|
1,873
|
|
|
2,485
|
|
||
Total leasing revenues
|
$
|
594,006
|
|
|
$
|
569,853
|
|
•
|
$37.6 million increase due to an increase of approximately 156,300 CEU in the average number of units on-hire under operating leases; partially offset by a
|
•
|
$20.5 million decrease due a
4.5%
decrease in lower average CEU per diem rates.
|
|
Year Ended December 31,
|
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Equipment trading revenues
|
$
|
56,436
|
|
|
$
|
73,004
|
|
Equipment trading expenses
|
(49,246
|
)
|
|
(62,726
|
)
|
||
Equipment trading margin
|
$
|
7,190
|
|
|
$
|
10,278
|
|
•
|
$20.1 million decrease due to a decrease of approximately 23% in used dry container selling prices;
|
•
|
$2.5 million decrease due to larger gains in 2013 related to units declared lost by one of our customers, which was not repeated in 2014, partially offset by a
|
•
|
$2.6 million increase due to an increase in sales volume.
|
•
|
$1.8 million increase in repair expense due to larger drop-off volume of dry containers;
|
•
|
$1.8 million increase in operating, handling and repositioning expenses resulting from a larger volume of pick-up and drop-off activity;
|
•
|
$1.6 million increase in storage costs due to an increase in the number of idle units, mainly an increase in the number of containers held for sale; and a
|
•
|
$0.6 million increase in survey costs due to increased procurement activity.
|
|
Year Ended December 31,
|
|
% Change Between
|
||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 and 2014
|
|
2014 and 2013
|
||||||||
|
(in thousands)
|
|
|
|
|
||||||||||||
Income before income taxes(1)
|
|
|
|
|
|
|
|
|
|
||||||||
Equipment leasing segment
|
$
|
128,259
|
|
|
$
|
180,356
|
|
|
$
|
198,210
|
|
|
(28.9
|
)%
|
|
(9.0
|
)%
|
Equipment trading segment
|
9,286
|
|
|
15,122
|
|
|
17,708
|
|
|
(38.6
|
)%
|
|
(14.6
|
)%
|
|||
Total
|
$
|
137,545
|
|
|
$
|
195,478
|
|
|
$
|
215,918
|
|
|
|
|
|
(1)
|
Income before income taxes excludes net losses on interest rate swaps and the write-off of deferred financing costs.
|
•
|
a
$20.6 million
year over year decline on the sale of leasing equipment mainly driven by lower selling prices;
|
•
|
an increase in direct operating expenses of
$16.0 million
mainly due to higher storage costs resulting from an increase in the number of idle units and higher redelivery and repair related costs due to higher volume of redeliveries;
|
•
|
Leasing margin (leasing revenues net of depreciation and amortization and interest and debt expense) decreased
$10.2
million mainly due to lower average per diem rates and an increase in our average debt balance. This decrease was partially offset by an increase in the fleet size and average number of units on hire; and
|
•
|
an increase in administrative expenses of
$5.3 million
mainly due to costs related to the pending merger.
|
|
Current
Amount
Outstanding
|
|
Current
Maximum
Borrowing
Level
|
||||
Asset backed securitization (ABS) term notes
|
$
|
1,151.5
|
|
|
$
|
1,151.5
|
|
Term loan facilities
|
973.1
|
|
|
1,071.2
|
|
||
Asset backed warehouse facility
|
610.0
|
|
|
650.0
|
|
||
Revolving credit facilities
|
445.0
|
|
|
550.0
|
|
||
Capital lease obligations
|
62.1
|
|
|
62.1
|
|
||
Total Debt
|
3,241.7
|
|
|
3,484.8
|
|
||
Deferred financing costs
|
(25.2
|
)
|
|
—
|
|
||
Debt, net of unamortized deferred financing costs
|
$
|
3,216.5
|
|
|
$
|
3,484.8
|
|
•
|
Minimum Earnings Before Interest and Taxes ("Covenant EBIT") to Cash Interest Expense;
|
•
|
Minimum Tangible Net Worth ("TNW"); and
|
•
|
Maximum Indebtedness to TNW.
|
Entity/Issuer
|
Minimum
Covenant EBIT to
Cash Interest
Expense Ratio
|
|
Actual
Covenant EBIT to
Cash Interest
Expense Ratio
|
Consolidated
|
1.10
|
|
2.36
|
TAL Advantage I, LLC
|
1.10
|
|
4.70
|
TAL Advantage III, LLC
|
1.30
|
|
2.59
|
TAL Advantage V, LLC
|
1.10
|
|
2.35*
|
Entity/Issuer
|
Maximum
Indebtedness
to TNW Ratio
|
|
Actual
Indebtedness
to TNW Ratio
|
Consolidated
|
4.75
|
|
3.07
|
TAL Advantage I, LLC
|
4.75
|
|
3.01
|
TAL Advantage III, LLC
|
4.75
|
|
2.99
|
TAL Advantage V, LLC
|
4.75
|
|
2.99
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Net cash provided by operating activities
|
$
|
400,478
|
|
|
$
|
398,807
|
|
|
$
|
366,688
|
|
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchases of leasing equipment and investments in finance leases
|
$
|
(704,178
|
)
|
|
$
|
(670,529
|
)
|
|
$
|
(660,492
|
)
|
Proceeds from sale of equipment, net of selling costs
|
125,525
|
|
|
165,990
|
|
|
140,724
|
|
|||
Cash collections on finance lease receivables, net of income earned
|
42,860
|
|
|
47,607
|
|
|
39,470
|
|
|||
Other
|
(101
|
)
|
|
(253
|
)
|
|
84
|
|
|||
Net cash (used in) investing activities
|
$
|
(535,894
|
)
|
|
$
|
(457,185
|
)
|
|
$
|
(480,214
|
)
|
Net cash provided by financing activities
|
$
|
115,191
|
|
|
$
|
68,635
|
|
|
$
|
116,558
|
|
|
Contractual Obligations by Period
|
||||||||||||||||||||||
Contractual Obligations:
|
Total
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020 and thereafter
|
||||||||||||
|
(dollars in millions)
|
||||||||||||||||||||||
Principal debt obligations
|
$
|
3,179.9
|
|
|
$
|
319.1
|
|
|
$
|
294.3
|
|
|
$
|
751.6
|
|
|
$
|
527.7
|
|
|
$
|
1,287.2
|
|
Interest on debt obligations(1)
|
481.1
|
|
|
100.8
|
|
|
93.2
|
|
|
80.0
|
|
|
64.0
|
|
|
143.1
|
|
||||||
Capital lease obligations(2)
|
66.5
|
|
|
29.9
|
|
|
18.8
|
|
|
17.8
|
|
|
—
|
|
|
—
|
|
||||||
Operating leases (mainly facilities)
|
6.3
|
|
|
1.8
|
|
|
1.3
|
|
|
1.1
|
|
|
2.0
|
|
|
0.1
|
|
||||||
Purchase obligations:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Equipment purchases payable
|
20.0
|
|
|
20.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Equipment purchase commitments
|
67.0
|
|
|
67.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total contractual obligations
|
$
|
3,820.8
|
|
|
$
|
538.6
|
|
|
$
|
407.6
|
|
|
$
|
850.5
|
|
|
$
|
593.7
|
|
|
$
|
1,430.4
|
|
(1)
|
Amounts include actual for fixed interest debt and estimated interest for floating rate debt based on
December 31, 2015
rates and the net effect of our interest rate swaps.
|
(2)
|
Amounts include interest.
|
|
|
Residual Values ($)
|
||||
|
|
Useful Lives (Years)
|
|
Effective October 1, 2012
|
||
Dry containers
|
|
|
|
|
||
20 foot
|
|
13
|
|
$
|
1,000
|
|
40 foot
|
|
13
|
|
$
|
1,200
|
|
40 foot high cube
|
|
13
|
|
$
|
1,400
|
|
Refrigerated containers
|
|
|
|
|
||
20 foot
|
|
12
|
|
$
|
2,500
|
|
40 foot high cube
|
|
12
|
|
$
|
3,500
|
|
Special containers
|
|
|
|
|
||
40 foot flat rack
|
|
14
|
|
$
|
1,500
|
|
40 foot open top
|
|
14
|
|
$
|
2,300
|
|
Tank containers
|
|
20
|
|
$
|
3,000
|
|
Chassis
|
|
20
|
|
$
|
1,200
|
|
Net Notional
Amount
|
|
Weighted Average
Fixed Leg (Pay) Interest Rate
|
|
Weighted Average
Remaining Term
|
$1,123 Million
|
|
2.00%
|
|
6.6 years
|
|
December 31,
|
||
|
2015
|
|
2014
|
Net loss on interest rate swaps
|
$0.2
|
|
$0.8
|
|
|
|
|
|
/s/ Ernst & Young LLP
|
|
Page
|
Exhibit No.
|
|
Description
|
3.1
|
|
Second Amended and Restated Certificate of Incorporation of TAL International Group, Inc. (incorporated by reference from Exhibit 3.1 to TAL International Group, Inc.'s Form 10-K filed on March 20, 2006)
|
|
|
|
3.2
|
|
Amended and Restated Bylaws of TAL International Group, Inc. (incorporated by reference from Exhibit 3.1 to TAL International Group, Inc.'s Form 8-K filed on November 10, 2015)
|
|
|
|
4.1
|
|
Form of Common Stock Certificate (incorporated by reference from Exhibit 4.1 to Amendment No. 3 to TAL International Group, Inc.'s Form S-1 filed on October 5, 2005, file number 333-126317)
|
|
|
|
4.2
|
|
Amended and Restated Indenture dated as of April 12, 2006 by and between TAL Advantage I LLC and U. S. Bank National Association (incorporated by reference from Exhibit 10.35 to TAL International Group, Inc.'s Form 10-Q filed on May 12, 2006)
|
|
|
|
4.3
|
|
First Supplemental Indenture between TAL Advantage I LLC and U.S. Bank National Association dated June 26, 2007 to the Amended and Restated Indenture dated as of April 12, 2006 (incorporated by reference from Exhibit 10.58 to TAL International Group, Inc.'s Form 10-Q filed on August 8, 2008)
|
|
|
|
4.4
|
|
Second Supplemental Indenture between TAL Advantage I LLC and U.S. Bank National Association dated November 19, 2007 to the Amended and Restated Indenture dated as of April 12, 2006 (incorporated by reference from Exhibit 10.59 to TAL International Group, Inc.'s Form 10-Q filed on August 8, 2008)
|
|
|
|
4.5
|
|
Amended and Restated Series 2005-1 Supplement dated as of April 12, 2006 between Advantage I LLC and U. S. Bank National Association (incorporated by reference from Exhibit 10.40 to TAL International Group, Inc.'s Form 10-Q filed on May 12, 2006)
|
|
|
|
Exhibit No.
|
|
Description
|
4.6
|
|
Amended and Restated Management Agreement dated as of April 12, 2006 by and between TAL International Container Corporation and TAL Advantage I LLC (incorporated by reference from Exhibit 10.36 to TAL International Group, Inc.'s Form 10-Q filed on May 12, 2006)
|
|
|
|
4.7
|
|
Amended and Restated Contribution and Sale Agreement dated as of April 12, 2006 by and between TAL International Container Corporation and TAL Advantage I LLC (incorporated by reference from Exhibit 10.37 to TAL International Group, Inc.'s Form 10-Q filed on May 12, 2006)
|
|
|
|
4.8
|
|
Amended and Restated Series 2005-1 Note Purchase Agreement dated as of April 7, 2006 by and between TAL Advantage I LLC, the Noteholders from time to time party thereto and the other financial institutions from time to time party thereto (incorporated by reference from Exhibit 10.41 to TAL International Group, Inc.'s Form 10-Q filed on May 12, 2006)
|
|
|
|
4.9
|
|
Series 2006-1 Supplement dated as of April 12, 2006 by and between TAL Advantage I LLC and U. S. Bank National Association (incorporated by reference from Exhibit 10.38 to TAL International Group, Inc.'s Form 10-Q filed on May 12, 2006)
|
|
|
|
4.10
|
|
Series 2006-1 Note Purchase Agreement dated as of April 7, 2006 by and between TAL Advantage I LLC, TAL International Container Corporation, and Fortis Securities LLC and Credit Suisse Securities (USA) LLC (incorporated by reference from Exhibit 10.39 to TAL International Group, Inc.'s Form 10-Q filed on May 12, 2006)
|
|
|
|
4.11
|
|
Intercreditor Agreement Dated April 12, 2006 by and among TAL International Container Corporation, TAL Advantage I LLC, U. S. Bank National Association and Fortis Capital Corp. (incorporated by reference from Exhibit 4.11 to TAL International Group, Inc.'s Form 10-K filed on March 3, 2009)
|
|
|
|
4.12
|
|
Credit Agreement, dated as of July 31, 2006, by and among TAL International Container Corporation, Fortis Capital Corp. and the Lenders party thereto (incorporated by reference from Exhibit 10.43 to TAL International Group, Inc.'s Form 8-K filed on August 4, 2006)
|
|
|
|
4.13
|
|
Amendment No. 1 dated July 13, 2007 to Credit Agreement, dated as of July 31, 2006, by and among TAL International Container Corporation, Fortis Capital Corp. and the Lenders party thereto (incorporated by reference from Exhibit 10.47 to TAL International Group, Inc.'s Form 8-K filed on July 17, 2007)
|
|
|
|
4.14
|
|
Security Agreement, dated as of July 31, 2006, by and among TAL International Container Corporation and Fortis Capital Corp. (incorporated by reference from Exhibit 10.44 to TAL International Group, Inc.'s Form 8-K filed on August 4, 2006)
|
|
|
|
4.15
|
|
Pledge Agreement, dated as of July 31, 2006, by and among TAL International Container Corporation and Fortis Capital Corp. (incorporated by reference from Exhibit 10.45 to TAL International Group, Inc.'s Form 8-K filed on August 4, 2006)
|
|
|
|
4.16
|
|
Guaranty, dated as of July 31, 2006, made by TAL International Group, Inc. (incorporated by reference from Exhibit 10.46 to TAL International Group, Inc.'s Form 8-K filed on August 4, 2006)
|
|
|
|
4.17
|
|
Third Supplemental Indenture between TAL Advantage I LLC and U.S. Bank National Association dated June 23, 2008 to the Amended and Restated Indenture dated as of April 12, 2006 (incorporated by reference from Exhibit 10.61 to TAL International Group, Inc.'s Form 10-Q filed on August 8, 2008)
|
|
|
|
4.18
|
|
Management Agreement dated as of October 23, 2009 between TAL International Container Corporation and TAL Advantage III LLC (incorporated by reference from Exhibit 4.33 to TAL International Group, Inc.'s Form 10-K filed on March 1, 2010)
|
|
|
|
4.19
|
|
Contribution and Sale Agreement dated as of October 23, 2009 between TAL International Container Corporation and TAL Advantage III LLC (incorporated by reference from Exhibit 4.34 to TAL International Group, Inc.'s Form 10-K filed on March 1, 2010)
|
|
|
|
Exhibit No.
|
|
Description
|
4.20
|
|
Amendment No. 1 dated as of July 16, 2010 to the Management Agreement dated as of October 23, 2009 by and between TAL Advantage III LLC and TAL International Container Corporation (incorporated by reference from Exhibit 4.54 to TAL International Group, Inc.'s Form 10-Q filed on July 30, 2010)
|
|
|
|
4.21
|
|
Amended and Restated Indenture dated as of August 12, 2011 by and between TAL Advantage III LLC and Wells Fargo Bank, National Association (incorporated by reference from Exhibit 4.65 to TAL International Group Inc.'s Form 10-Q filed on October 28, 2011)
|
|
|
|
4.22
|
|
Amended and Restated Credit Agreement dated November 30, 2011, by and among TAL International Container Corporation, The Royal Bank of Scotland PLC as Administrative Agent and as Collateral Agent, RBS Securities, Inc. as Sole Arranger, and the Lenders from time to time party thereto (incorporated by reference from Exhibit 4.45 to TAL International Group Inc.'s Form 10-K filed on February 22, 2012)
|
|
|
|
4.23
|
|
Amended and Restated Security Agreement dated November 30, 2011, by and among TAL International Container Corporation and The Royal Bank of Scotland PLC as Collateral Agent (incorporated by reference from Exhibit 4.46 to TAL International Group Inc.'s Form 10-K filed on February 22, 2012)
|
|
|
|
4.24
|
|
Amended and Restated Pledge Agreement dated November 30, 2011, by and among TAL International Container Corporation, as Pledgor in favor of The Royal Bank of Scotland PLC in its capacity as Collateral Agent, as Pledgee (incorporated by reference from Exhibit 4.47 to TAL International Group Inc.'s Form 10-K filed on February 22, 2012)
|
|
|
|
4.25
|
|
Amended and Restated Guaranty dated November 30, 2011 made by TAL International Group, Inc. (incorporated by reference from Exhibit 4.48 to TAL International Group Inc.'s Form 10-K filed on February 22, 2012)
|
|
|
|
4.26
|
|
Amendment No. 2 dated December 22, 2011 to the Credit Agreement dated July 31, 2006, by and among TAL International Container Corporation, Fortis Bank NA/SV, assignee of Fortis Capital Corp. and the Lenders party thereto (incorporated by reference from Exhibit 4.49 to TAL International Group Inc.'s Form 10-K filed on February 22, 2012)
|
|
|
|
4.27
|
|
Indenture, dated as of February 27, 2013, by and between TAL Advantage V, LLC and Wells Fargo Bank, National Association, as Indenture Trustee (incorporated by reference from Exhibit 4.52 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
4.28
|
|
Series 2013-1 Supplement dated as of February 27, 2013, by and between TAL Advantage V, LLC and Wells Fargo Bank, National Association, as Indenture Trustee (incorporated by reference from Exhibit 4.53 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
4.29
|
|
Management Agreement dated as of February 27, 2013, by and between TAL International Container Corporation and TAL Advantage V LLC (incorporated by reference from Exhibit 4.54 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
4.30
|
|
Contribution and Sale Agreement dated as of February 27, 2013 by and between TAL International Container Corporation and TAL Advantage V LLC (incorporated by reference from Exhibit 4.55 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
4.31
|
|
Transition Agent Agreement dated as of February 27, 2013 by and between Wells Fargo Bank, National Association, TAL International Container Corporation and TAL Advantage V LLC (incorporated by reference from Exhibit 4.56 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
4.32
|
|
Series 2013-1 Note Purchase Agreement dated as of February 20, 2013 by and between TAL Advantage V LLC, TAL International Container Corporation, Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBS Securities Inc. and RBC Capital Markets, LLC (incorporated by reference from Exhibit 4.57 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
Exhibit No.
|
|
Description
|
4.33
|
|
Credit Agreement, dated as of March 12, 2013, by and among TAL International Container Corporation, the Lenders from time to time party thereto, Bank of America N.A. as Administrative Agent and Collateral Agent, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Securities, LLC and RBC Capital Markets, as Joint Lead Arrangers (incorporated by reference from Exhibit 4.58 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
4.34
|
|
Security Agreement dated March 12, 2013, by and among TAL International Container Corporation and Bank of America N.A. as Collateral Agent (incorporated by reference from Exhibit 4.59 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
4.35
|
|
Guaranty dated March 12, 2013 made by TAL International Group, Inc. (incorporated by reference from Exhibit 4.60 to TAL International Group Inc.'s Form 10-Q filed on April 30, 2013)
|
|
|
|
4.36
|
|
Omnibus Amendment No. 1 dated July 2, 2013 to the Amended and Restated Indenture, Series 2009-1 Supplement and Series 2009-1 Note Purchase Agreement by and between TAL Advantage III LLC and Wells Fargo Bank, National Association, Wells Fargo Securities, LLC, and the other Noteholders from time to time party thereto and the other financial institutions from time to time party thereto (incorporated by reference from Exhibit 4.63 to TAL International Group Inc.'s Form 10-Q filed on July 30, 2013)
|
|
|
|
4.37
|
|
Fourth Supplemental Indenture between TAL Advantage I LLC and U.S. Bank National Association dated July 5, 2013 to the Amended and Restated Indenture dated as of April 12, 2006 (incorporated by reference from Exhibit 4.64 to TAL International Group Inc.'s Form 10-Q filed on July 30, 2013)
|
|
|
|
4.38
|
|
Series 2013-2 Note Purchase Agreement dated as of October 31, 2013 by and between TAL Advantage V LLC, TAL International Container Corporation, and Nomura Securities International, Inc. (incorporated by reference from Exhibit 4.60 to TAL International Group Inc.'s Form 10-K filed on February 20, 2014)
|
|
|
|
4.39
|
|
Series 2013-2 Supplement dated as of November 7, 2013, by and between TAL Advantage V, LLC and Wells Fargo Bank, National Association, as Indenture Trustee (incorporated by reference from Exhibit 4.61 to TAL International Group, Inc.'s Form 10-K filed on February 20, 2014)
|
|
|
|
4.40
|
|
Amendment No. 1 dated November 8, 2013 to the 2013-1 Supplement dated February 27, 2013, by and among TAL Advantage V LLC and Wells Fargo Bank, National Association, as Indenture Trustee (incorporated by reference from Exhibit 4.62 to TAL International Group, Inc.'s Form 10-K filed on February 20, 2014)
|
|
|
|
4.41
|
|
Amendment No. 2 dated as of February 26, 2014, to the Indenture dated as of February 27, 2013 between TAL Advantage V LLC, as the Issuer and Wells Fargo Bank, National Association, as the Indenture Trustee (incorporated by reference from Exhibit 4.63 to TAL International Group, Inc.'s Form 10-Q filed on April 29, 2014)
|
|
|
|
4.42
|
|
Series 2014-1 Supplement dated as of February 27, 2014 by and between TAL Advantage V LLC as the Issuer and Wells Fargo Bank, National Association as the Indenture Trustee (incorporated by reference from Exhibit 4.64 to TAL International Group, Inc.'s Form 10-Q filed on April 29, 2014)
|
|
|
|
4.43
|
|
Series 2014-1 Note Purchase Agreement dated as of February 19, 2014 by and between TAL Advantage V LLC, as Issuer, TAL International Container Corporation, as Manager, Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets, LLC, and Wells Fargo Securities, LLC, as Initial Purchasers (incorporated by reference from Exhibit 4.65 to TAL International Group, Inc.'s Form 10-Q filed on April 29, 2014)
|
|
|
|
4.44
|
|
Term Loan Agreement dated as of April 2, 2014 by and between TAL International Container Corporation, as Borrower, the Lenders from time to time party thereto, as Lenders, Suntrust Bank, as Administrative Agent and as Collateral Agent, Suntrust Robinson Humphrey, Inc., as Lead Arranger, and ING Belgium SA/NV, as Syndication Agent (incorporated by reference from Exhibit 4.66 to TAL International Group, Inc.'s Form 10-Q filed on April 29, 2014)
|
|
|
|
Exhibit No.
|
|
Description
|
4.45
|
|
Security Agreement dated as of April 2, 2014, by and among TAL International Container Corporation and Suntrust Bank as Collateral Agent (incorporated by reference from Exhibit 4.67 to TAL International Group, Inc.'s Form 10-Q filed on April 29, 2014)
|
|
|
|
4.46
|
|
Guaranty dated as of April 2, 2014, made by TAL International Group, Inc. (incorporated by reference from Exhibit 4.68 to TAL International Group, Inc.'s Form 10-Q filed on April 29, 2014)
|
|
|
|
4.47
|
|
Series 2014-2 Supplement dated as of May 19, 2014 by and between TAL Advantage V LLC, as Issuer and Wells Fargo Bank, National Association, as the Indenture Trustee (incorporated by reference from Exhibit 4.69 to TAL International Group, Inc.'s Form 10-Q filed on July 30, 2014)
|
|
|
|
4.48
|
|
Series 2014-2 Note Purchase Agreement dated as of May 8, 2014 by and between TAL Advantage V LLC, as Issuer, TAL International Container Corporation, as Manager, BNP Paribas Securities Corp., Wells Fargo Securities, LLC, and RBC Capital Markets, LLC as Initial Purchasers (incorporated by reference from Exhibit 4.70 to TAL International Group, Inc.'s Form 10-Q filed on July 30, 2014)
|
|
|
|
4.49
|
|
Amendment No. 2 dated October 10, 2014 to the Amended and Restated Indenture, dated as of August 12, 2011, by and between TAL Advantage III LLC, as Issuer and Wells Fargo Bank, National. Association, as Indenture Trustee (incorporated by reference from Exhibit 4.71 to TAL International Group, Inc.'s Form 10-Q filed on October 29, 2014)
|
|
|
|
4.50
|
|
Second Amended and Restated 2009-1 Supplement dated as of October 10, 2014 by and between TAL Advantage III LLC, as Issuer and Wells Fargo Bank, National Association, as Indenture Trustee (incorporated by reference from Exhibit 4.72 to TAL International Group, Inc.'s Form 10-Q filed on October 29, 2014)
|
|
|
|
4.51
|
|
Second Amended and Restated Series 2009-1 Note Purchase Agreement dated as of October 10, 2014 by and between TAL Advantage III LLC, as Issuer and the Noteholders from time to time party thereto and the other financial institutions from time to time party hereto (incorporated by reference from Exhibit 4.73 to TAL International Group, Inc.'s Form 10-Q filed on October 29, 2014)
|
|
|
|
4.52
|
|
Amendment No. 2 dated October 10, 2014 to the Management Agreement dated October 23, 2009 by and between TAL Advantage III LLC, as Issuer and TAL International Container Corporation, as Manager (incorporated by reference from Exhibit 4.74 to TAL International Group, Inc.'s Form 10-Q filed on October 29, 2014)
|
|
|
|
4.53
|
|
Credit Agreement dated as of November 7, 2014 by and between TAL International Container Corporation, as Borrower, the Lenders from time to time party hereto, as Lenders, First Niagara Bank, N.A., as Administrative Agent, as Collateral Agent, and as Joint Lead Arranger and Joint Bookrunner, ING Belgium SA/NV, as Syndication Agent, Joint Lead Arranger and Joint Bookrunner, and Wells Fargo Equipment Finance, Inc. and PNC Bank, National Association, as Co-documentation Agents
|
|
|
|
4.54
|
|
Security Agreement dated as of November 7, 2014, by and among TAL International Container Corporation and First Niagara Bank, N.A. as Collateral Agent
|
|
|
|
4.55
|
|
Guaranty dated as of November 7, 2014, made by TAL International Group, Inc.
|
|
|
|
4.56
|
|
Series 2014-3 Supplement dated as of November 25, 2014 by and between TAL Advantage V LLC, as Issuer and Wells Fargo Bank, National Association, as the Indenture Trustee
|
|
|
|
4.57
|
|
Series 2014-3 Note Purchase Agreement dated as of November 18, 2014 by and between TAL Advantage V LLC, as Issuer, TAL International Container Corporation, as Manager, RBC Capital Markets, LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Securities, LLC, ABN Amro Securities (USA) LLC, Nomura Securities International, Inc., and Mizuho Securities USA Inc. as Initial Purchasers
|
Exhibit No.
|
|
Description
|
4.58
|
*
|
Modification of Term Loan Agreement dated as of February 5, 2016 by and between TAL International Container Corporation, as Borrower, the Lenders from time to time party thereto, as Lenders, Suntrust Bank, as Administrative Agent and as Collateral Agent, Suntrust Robinson Humphrey, Inc., as Lead Arranger, and ING Belgium SA/NV, as Syndication Agent
|
|
|
|
10.1
|
|
Amended and Restated Management Subscription Agreement, dated as of October 11, 2005, by and among TAL International Group, Inc., Brian M. Sondey, Chand Khan, Frederico Baptista, Adrian Dunner, John C. Burns, Bernd Schackier and John Pearson (incorporated by reference from Exhibit 10.9 to TAL International Group, Inc.'s Form 10-K filed on March 20, 2006)
|
|
|
|
10.2
|
|
Amended and Restated Tax Sharing Agreement, dated as of August 1, 2005, by and among TAL International Group, Inc. and its subsidiaries named therein (incorporated by reference from Exhibit 10.12 to Amendment No. 1 to TAL International Group, Inc.'s Form S-1 filed on August 26, 2005, file number 333-126317)
|
|
|
|
10.3
|
+
|
Employment Agreement, dated as of November 3, 2004, by and between TAL International Group, Inc. and Brian M. Sondey (incorporated by reference from Exhibit 10.13 to TAL International Group, Inc.'s Form S-1 filed on June 30, 2005, file number 333-126317)
|
|
|
|
10.4
|
+
|
Form of Indemnity Agreement between TAL International Group, Inc., certain of its subsidiaries, each of their respective current directors and certain of their respective current officers (incorporated by reference from Exhibit 10.22 to Amendment No. 2 to TAL International Group, Inc.'s Form S-1 filed on September 20, 2005, file number 333-126317)
|
|
|
|
10.5
|
+
|
2005 Management Omnibus Incentive Plan (incorporated by reference from Exhibit 10.33 to TAL International Group, Inc.'s Form 10-K filed on March 20, 2006)
|
|
|
|
10.6
|
+
|
2014 Equity Incentive Plan (incorporated by reference from Exhibit 4.4 to TAL International Group, Inc.'s Form S-8 filed on July 30, 2014)
|
|
|
|
14.1
|
|
Code of Ethics (incorporated by reference from Exhibit 14.1 to the TAL International Group, Inc.'s Form 8-K filed on April 3, 2006)
|
|
|
|
21.1
|
*
|
List of Subsidiaries
|
|
|
|
23.1
|
*
|
Consent of Independent Registered Public Accounting Firm
|
|
|
|
24.1
|
*
|
Powers of Attorney (included on the signature page to this Annual Report on Form 10-K)
|
|
|
|
31.1
|
*
|
Certification of the Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended
|
|
|
|
31.2
|
*
|
Certification of the Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended
|
|
|
|
32.1
|
**
|
Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350
|
|
|
|
32.2
|
**
|
Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Instance Extension Schema
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
Exhibit No.
|
|
Description
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
Date: February 29, 2016
|
TAL International Group, Inc.
|
|
|
By:
|
/s/ BRIAN M. SONDEY
|
|
|
Brian M. Sondey
Chairman, President and Chief Executive Officer
|
Signature
|
Title(s)
|
|
|
/s/ BRIAN M. SONDEY
|
Chairman, President and Chief Executive Officer (Principal Executive Officer), Director
|
Brian M. Sondey
|
|
|
|
/s/ JOHN BURNS
|
Senior Vice President, Chief Financial Officer (Principal Financial Officer)
|
John Burns
|
|
|
|
/s/ MICHELLE GALLAGHER
|
Vice President and Controller (Principal Accounting Officer)
|
Michelle Gallagher
|
|
|
|
/s/ MALCOLM P. BAKER
|
Director
|
Malcolm P. Baker
|
|
|
|
/s/ CLAUDE GERMAIN
|
Director
|
Claude Germain
|
|
|
|
/s/ KENNETH HANAU
|
Director
|
Kenneth Hanau
|
|
|
|
/s/ HELMUT KASPERS
|
Director
|
Helmut Kaspers
|
|
|
|
/s/ FREDERIC H. LINDEBERG
|
Director
|
Frederic H. Lindeberg
|
|
Page
|
CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
/s/ Ernst & Young LLP
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
ASSETS:
|
|
|
|
||||
Leasing equipment, net of accumulated depreciation and allowances of $1,218,826 and $1,055,864
|
$
|
3,908,292
|
|
|
$
|
3,674,031
|
|
Net investment in finance leases, net of allowances of $805 and $1,056
|
177,737
|
|
|
219,872
|
|
||
Equipment held for sale
|
74,899
|
|
|
59,861
|
|
||
Revenue earning assets
|
4,160,928
|
|
|
3,953,764
|
|
||
Unrestricted cash and cash equivalents
|
58,907
|
|
|
79,132
|
|
||
Restricted cash
|
30,302
|
|
|
35,649
|
|
||
Accounts receivable, net of allowances of $1,314 and $978
|
95,709
|
|
|
85,681
|
|
||
Goodwill
|
74,523
|
|
|
74,523
|
|
||
Other assets
|
13,620
|
|
|
11,400
|
|
||
Fair value of derivative instruments
|
87
|
|
|
1,898
|
|
||
Total assets
|
$
|
4,434,076
|
|
|
$
|
4,242,047
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY:
|
|
|
|
||||
Equipment purchases payable
|
$
|
20,009
|
|
|
$
|
88,336
|
|
Fair value of derivative instruments
|
20,348
|
|
|
10,394
|
|
||
Accounts payable and other accrued expenses
|
56,096
|
|
|
57,877
|
|
||
Net deferred income tax liability
|
456,123
|
|
|
411,007
|
|
||
Debt, net of unamortized deferred financing costs of $25,245 and $32,937
|
3,216,488
|
|
|
3,007,905
|
|
||
Total liabilities
|
3,769,064
|
|
|
3,575,519
|
|
||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $0.001 par value, 500,000 shares authorized, none issued
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value, 100,000,000 shares authorized, 37,167,134 and 37,006,283 shares issued respectively
|
37
|
|
|
37
|
|
||
Treasury stock, at cost, 3,911,843 and 3,829,928 shares
|
(75,310
|
)
|
|
(71,917
|
)
|
||
Additional paid-in capital
|
511,297
|
|
|
504,891
|
|
||
Accumulated earnings
|
248,183
|
|
|
246,766
|
|
||
Accumulated other comprehensive (loss)
|
(19,195
|
)
|
|
(13,249
|
)
|
||
Total stockholders' equity
|
665,012
|
|
|
666,528
|
|
||
Total liabilities and stockholders' equity
|
$
|
4,434,076
|
|
|
$
|
4,242,047
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Leasing revenues:
|
|
|
|
|
|
||||||
Operating leases
|
$
|
591,665
|
|
|
$
|
573,778
|
|
|
$
|
552,640
|
|
Finance leases
|
15,192
|
|
|
18,355
|
|
|
14,728
|
|
|||
Other revenues
|
1,147
|
|
|
1,873
|
|
|
2,485
|
|
|||
Total leasing revenues
|
608,004
|
|
|
594,006
|
|
|
569,853
|
|
|||
|
|
|
|
|
|
||||||
Equipment trading revenues
|
62,195
|
|
|
56,436
|
|
|
73,004
|
|
|||
Equipment trading expenses
|
(58,001
|
)
|
|
(49,246
|
)
|
|
(62,726
|
)
|
|||
Trading margin
|
4,194
|
|
|
7,190
|
|
|
10,278
|
|
|||
|
|
|
|
|
|
||||||
Net (loss) gain on sale of leasing equipment
|
(13,646
|
)
|
|
6,987
|
|
|
26,751
|
|
|||
|
|
|
|
|
|
||||||
Operating expenses:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
242,538
|
|
|
224,753
|
|
|
205,073
|
|
|||
Direct operating expenses
|
48,902
|
|
|
33,076
|
|
|
27,142
|
|
|||
Administrative expenses
|
51,154
|
|
|
45,399
|
|
|
44,197
|
|
|||
Provision for doubtful accounts
|
133
|
|
|
212
|
|
|
2,827
|
|
|||
Total operating expenses
|
342,727
|
|
|
303,440
|
|
|
279,239
|
|
|||
Operating income
|
255,825
|
|
|
304,743
|
|
|
327,643
|
|
|||
Other expenses:
|
|
|
|
|
|
||||||
Interest and debt expense
|
118,280
|
|
|
109,265
|
|
|
111,725
|
|
|||
Write-off of deferred financing costs
|
895
|
|
|
5,192
|
|
|
4,000
|
|
|||
Net loss (gain) on interest rate swaps
|
205
|
|
|
780
|
|
|
(8,947
|
)
|
|||
Total other expenses
|
119,380
|
|
|
115,237
|
|
|
106,778
|
|
|||
Income before income taxes
|
136,445
|
|
|
189,506
|
|
|
220,865
|
|
|||
Income tax expense
|
48,233
|
|
|
65,461
|
|
|
77,699
|
|
|||
Net income
|
$
|
88,212
|
|
|
$
|
124,045
|
|
|
$
|
143,166
|
|
Net income per common share—Basic
|
$
|
2.68
|
|
|
$
|
3.70
|
|
|
$
|
4.28
|
|
Net income per common share—Diluted
|
$
|
2.67
|
|
|
$
|
3.68
|
|
|
$
|
4.25
|
|
Cash dividends paid per common share
|
$
|
2.61
|
|
|
$
|
2.88
|
|
|
$
|
2.68
|
|
Weighted average number of common shares outstanding—Basic
|
32,861
|
|
|
33,482
|
|
|
33,483
|
|
|||
Dilutive stock options and restricted stock
|
118
|
|
|
182
|
|
|
211
|
|
|||
Weighted average number of common shares outstanding—Diluted
|
32,979
|
|
|
33,664
|
|
|
33,694
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Net income
|
$
|
88,212
|
|
|
$
|
124,045
|
|
|
$
|
143,166
|
|
Other comprehensive (loss) income:
|
|
|
|
|
|
||||||
Change in fair value of derivative instruments designated as cash flow hedges (net of income tax effect of $(10,930), $(18,248) and $6,380, respectively)
|
(20,038
|
)
|
|
(33,814
|
)
|
|
11,643
|
|
|||
Reclassification of realized loss on interest rate swap agreements designated as cash flow hedges (net of income tax effect of $6,884, $4,789 and $2,626, respectively)
|
12,588
|
|
|
9,106
|
|
|
4,844
|
|
|||
Amortization of net loss on terminated derivative instruments designated as cash flow hedges (net of income tax effect of $921, $875 and $1,067, respectively)
|
1,697
|
|
|
1,604
|
|
|
1,953
|
|
|||
Foreign currency translation adjustment
|
(193
|
)
|
|
(215
|
)
|
|
60
|
|
|||
Other comprehensive (loss) income, net of tax
|
(5,946
|
)
|
|
(23,319
|
)
|
|
18,500
|
|
|||
Comprehensive income
|
$
|
82,266
|
|
|
$
|
100,726
|
|
|
$
|
161,666
|
|
|
Common Stock
|
|
Treasury Stock
|
|
|
|
|
|
Accumulated Other
Comprehensive (Loss) Income
|
||||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Earnings
|
|
Cash Flow
Hedges
|
|
Foreign
Currency
Translation
|
|
Total
|
||||||||||||||||
Balance at December 31, 2012
|
36,697,366
|
|
|
$
|
37
|
|
|
3,011,843
|
|
|
$
|
(37,535
|
)
|
|
$
|
493,456
|
|
|
$
|
168,447
|
|
|
$
|
(7,481
|
)
|
|
$
|
(949
|
)
|
|
$
|
(8,430
|
)
|
Stock compensation-restricted stock activity, net of retirements
|
142,944
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,216
|
|
|
(176
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock options exercised, net of retirements
|
18,468
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
182
|
|
|
(241
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
143,166
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
60
|
|
|
60
|
|
|||||||
Change in fair value-cash flow hedges, net of income tax effect of $6,380
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,643
|
|
|
—
|
|
|
11,643
|
|
|||||||
Reclassification of realized loss on interest rate swap agreements designated as cash flow hedges, net of income tax effect of $2,626
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,844
|
|
|
—
|
|
|
4,844
|
|
|||||||
Amortization of net loss on terminated derivative instruments designated as cash flow hedges, net of income tax effect of $1,067
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,953
|
|
|
—
|
|
|
1,953
|
|
|||||||
Common stock dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(90,704
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Balance at December 31, 2013
|
36,858,778
|
|
|
$
|
37
|
|
|
3,011,843
|
|
|
$
|
(37,535
|
)
|
|
$
|
498,854
|
|
|
$
|
220,492
|
|
|
$
|
10,959
|
|
|
$
|
(889
|
)
|
|
$
|
10,070
|
|
Stock compensation-restricted stock activity, net of retirements
|
144,555
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,984
|
|
|
(287
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock options exercised, net of retirements
|
2,950
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Treasury stock acquired
|
—
|
|
|
—
|
|
|
818,085
|
|
|
(34,382
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
124,045
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(215
|
)
|
|
(215
|
)
|
|||||||
Change in fair value-cash flow hedges, net of income tax effect of $(18,248)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(33,814
|
)
|
|
—
|
|
|
(33,814
|
)
|
|||||||
Reclassification of realized loss on interest rate swap agreements designated as cash flow hedges, net of income tax effect of $4,789
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,106
|
|
|
—
|
|
|
9,106
|
|
|||||||
Amortization of net loss on terminated derivative instruments designated as cash flow hedges, net of income tax effect of $875
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,604
|
|
|
—
|
|
|
1,604
|
|
|||||||
Common stock dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(97,484
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Balance at December 31, 2014
|
37,006,283
|
|
|
$
|
37
|
|
|
3,829,928
|
|
|
$
|
(71,917
|
)
|
|
$
|
504,891
|
|
|
$
|
246,766
|
|
|
$
|
(12,145
|
)
|
|
$
|
(1,104
|
)
|
|
$
|
(13,249
|
)
|
Stock compensation-restricted stock activity, net of retirements
|
158,750
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,452
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock options exercised, net of retirements
|
2,101
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Treasury stock acquired
|
—
|
|
|
—
|
|
|
81,915
|
|
|
(3,393
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
(Reduction) to tax benefits from stock compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(84
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
88,212
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(193
|
)
|
|
(193
|
)
|
|||||||
Change in fair value-cash flow hedges, net of income tax effect of $(10,930)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,038
|
)
|
|
—
|
|
|
(20,038
|
)
|
|||||||
Reclassification of realized loss on interest rate swap agreements designated as cash flow hedges, net of income tax effect of $6,884
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,588
|
|
|
—
|
|
|
12,588
|
|
|||||||
Amortization of net loss on terminated derivative instruments designated as cash flow hedges, net of income tax effect of $921
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,697
|
|
|
—
|
|
|
1,697
|
|
|||||||
Common stock dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(86,795
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Balance at December 31, 2015
|
37,167,134
|
|
|
$
|
37
|
|
|
3,911,843
|
|
|
$
|
(75,310
|
)
|
|
$
|
511,297
|
|
|
$
|
248,183
|
|
|
$
|
(17,898
|
)
|
|
$
|
(1,297
|
)
|
|
$
|
(19,195
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
88,212
|
|
|
$
|
124,045
|
|
|
$
|
143,166
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
242,538
|
|
|
224,753
|
|
|
205,073
|
|
|||
Amortization of deferred financing costs
|
7,602
|
|
|
7,729
|
|
|
7,260
|
|
|||
Amortization of net loss on terminated derivative instruments designated as cash flow hedges
|
2,618
|
|
|
2,479
|
|
|
3,020
|
|
|||
Amortization of lease intangibles
|
3,713
|
|
|
130
|
|
|
—
|
|
|||
Net loss (gain) on sale of leasing equipment
|
13,646
|
|
|
(6,987
|
)
|
|
(26,751
|
)
|
|||
Net loss (gain) on interest rate swaps
|
205
|
|
|
780
|
|
|
(8,947
|
)
|
|||
Write-off of deferred financing costs
|
895
|
|
|
5,192
|
|
|
4,000
|
|
|||
Deferred income taxes
|
48,233
|
|
|
65,461
|
|
|
77,699
|
|
|||
Stock compensation charge
|
6,452
|
|
|
5,984
|
|
|
5,216
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Net equipment (purchased) sold for resale activity
|
(4,878
|
)
|
|
(6,671
|
)
|
|
(11,186
|
)
|
|||
Net realized loss on interest rate swaps terminated prior to their contractual maturities
|
—
|
|
|
(4,953
|
)
|
|
(24,235
|
)
|
|||
Accounts receivable
|
(10,028
|
)
|
|
(11,507
|
)
|
|
(2,811
|
)
|
|||
Net (deferred revenue)
|
(7,098
|
)
|
|
(5,696
|
)
|
|
(1,572
|
)
|
|||
Accounts payable and other accrued expenses
|
8,123
|
|
|
(720
|
)
|
|
(3,982
|
)
|
|||
Income taxes payable
|
—
|
|
|
67
|
|
|
(220
|
)
|
|||
Other assets
|
245
|
|
|
(1,279
|
)
|
|
958
|
|
|||
Net cash provided by operating activities
|
400,478
|
|
|
398,807
|
|
|
366,688
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchases of leasing equipment and investments in finance leases
|
(704,178
|
)
|
|
(670,529
|
)
|
|
(660,492
|
)
|
|||
Proceeds from sale of equipment, net of selling costs
|
125,525
|
|
|
165,990
|
|
|
140,724
|
|
|||
Cash collections on finance lease receivables, net of income earned
|
42,860
|
|
|
47,607
|
|
|
39,470
|
|
|||
Other
|
(101
|
)
|
|
(253
|
)
|
|
84
|
|
|||
Net cash (used in) investing activities
|
(535,894
|
)
|
|
(457,185
|
)
|
|
(480,214
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Purchases of treasury stock
|
(4,446
|
)
|
|
(34,382
|
)
|
|
—
|
|
|||
Stock options exercised, related activity, and excess tax benefits from stock compensation
|
38
|
|
|
(234
|
)
|
|
(235
|
)
|
|||
Financing fees paid under debt facilities
|
(805
|
)
|
|
(16,702
|
)
|
|
(13,897
|
)
|
|||
Borrowings under debt facilities and proceeds under capital lease obligations
|
665,000
|
|
|
1,828,545
|
|
|
1,206,735
|
|
|||
Payments under debt facilities and capital lease obligations
|
(464,183
|
)
|
|
(1,605,666
|
)
|
|
(993,011
|
)
|
|||
Decrease (increase) in restricted cash
|
5,347
|
|
|
(6,523
|
)
|
|
6,711
|
|
|||
Common stock dividends paid
|
(85,760
|
)
|
|
(96,403
|
)
|
|
(89,745
|
)
|
|||
Net cash provided by financing activities
|
115,191
|
|
|
68,635
|
|
|
116,558
|
|
|||
Net (decrease) increase in unrestricted cash and cash equivalents
|
$
|
(20,225
|
)
|
|
$
|
10,257
|
|
|
$
|
3,032
|
|
Unrestricted cash and cash equivalents, beginning of period
|
79,132
|
|
|
68,875
|
|
|
65,843
|
|
|||
Unrestricted cash and cash equivalents, end of period
|
$
|
58,907
|
|
|
$
|
79,132
|
|
|
$
|
68,875
|
|
Supplemental disclosures:
|
|
|
|
|
|
||||||
Interest paid
|
$
|
108,488
|
|
|
$
|
99,895
|
|
|
$
|
101,535
|
|
Income taxes (refunded) paid
|
$
|
—
|
|
|
$
|
(67
|
)
|
|
$
|
225
|
|
Supplemental non-cash investing activities:
|
|
|
|
|
|
||||||
Accrued and unpaid purchases of equipment
|
$
|
20,009
|
|
|
$
|
88,336
|
|
|
$
|
112,268
|
|
|
|
Residual Values ($)
|
||||
|
|
Useful Lives (Years)
|
|
Effective October 1, 2012
|
||
Dry containers
|
|
|
|
|
||
20 foot
|
|
13
|
|
$
|
1,000
|
|
40 foot
|
|
13
|
|
$
|
1,200
|
|
40 foot high cube
|
|
13
|
|
$
|
1,400
|
|
Refrigerated containers
|
|
|
|
|
||
20 foot
|
|
12
|
|
$
|
2,500
|
|
40 foot high cube
|
|
12
|
|
$
|
3,500
|
|
Special containers
|
|
|
|
|
||
40 foot flat rack
|
|
14
|
|
$
|
1,500
|
|
40 foot open top
|
|
14
|
|
$
|
2,300
|
|
Tank containers
|
|
20
|
|
$
|
3,000
|
|
Chassis
|
|
20
|
|
$
|
1,200
|
|
|
|
December 31,
|
||||||
|
|
2015
|
|
2014
|
||||
Dry container units
|
|
$
|
2,738,123
|
|
|
$
|
2,563,183
|
|
Refrigerated container units
|
|
673,526
|
|
|
637,115
|
|
||
Special container units
|
|
213,904
|
|
|
208,841
|
|
||
Tank container units
|
|
175,302
|
|
|
172,871
|
|
||
Chassis
|
|
107,437
|
|
|
92,021
|
|
||
Total
|
|
$
|
3,908,292
|
|
|
$
|
3,674,031
|
|
•
|
Level 1—Financial assets and liabilities whose values are based on observable inputs such as quoted prices for identical instruments in active markets (unadjusted).
|
•
|
Level 2—Financial assets and liabilities whose values are based on observable inputs such as (i) quoted prices for similar instruments in active markets; (ii) quoted prices for identical or similar instruments in markets that are not active; or (iii) model-derived valuations in which all significant inputs are observable in active markets.
|
•
|
Level 3—Financial assets and liabilities whose values are derived from valuation techniques based on one or more significant unobservable inputs.
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
Assets
|
|
|
|
||||
Net investment in finance leases, net of allowances - carrying value
|
$
|
177,737
|
|
|
$
|
219,872
|
|
Net investment in finance leases, net of allowances - fair value
|
$
|
180,565
|
|
|
$
|
222,399
|
|
Liabilities
|
|
|
|
||||
Debt, net of unamortized deferred financing costs - carrying value
|
$
|
3,216,488
|
|
|
$
|
3,007,905
|
|
Debt(1) - estimated fair value
|
$
|
3,210,722
|
|
|
$
|
3,027,853
|
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
Asset backed securitization (ABS) term notes
|
$
|
1,151,497
|
|
|
$
|
1,504,183
|
|
Term loan facilities
|
973,130
|
|
|
858,973
|
|
||
Asset backed warehouse facility
|
610,000
|
|
|
420,000
|
|
||
Revolving credit facilities
|
445,000
|
|
|
160,000
|
|
||
Capital lease obligations
|
62,106
|
|
|
97,686
|
|
||
Total Debt
|
3,241,733
|
|
|
3,040,842
|
|
||
Deferred financing costs
|
(25,245
|
)
|
|
(32,937
|
)
|
||
Debt, net of unamortized deferred financing costs
|
$
|
3,216,488
|
|
|
$
|
3,007,905
|
|
Years ending December 31,
|
|
||
2016
|
$
|
318,992
|
|
2017
|
294,281
|
|
|
2018
|
751,564
|
|
|
2019
|
527,623
|
|
|
2020
|
278,933
|
|
|
2021 and thereafter
|
1,008,234
|
|
|
Total
|
$
|
3,179,627
|
|
Years ending December 31,
|
|
||
2016
|
$
|
29,923
|
|
2017
|
18,771
|
|
|
2018
|
17,818
|
|
|
2019
|
—
|
|
|
Total future payments
|
66,512
|
|
|
Less: amount representing interest
|
(4,406
|
)
|
|
Capital lease obligations
|
$
|
62,106
|
|
Net Notional
Amount(1)
|
|
Weighted Average
Fixed Leg (Pay) Interest Rate(2)
|
|
Weighted Average
Remaining Term(2)
|
$1,123 Million
|
|
2.00%
|
|
6.6 years
|
(1)
|
As of
December 31, 2015
, the net notional amount outstanding on the Company's interest rate swap agreements is comprised of
$1,223 million
of pay-fixed rate/receive-floating rate agreements and
$100.0 million
of pay-floating rate/receive-fixed rate agreements. The Company entered into the pay-floating rate/receive-fixed rate agreements at the parent company level to offset the cash flows on certain pay-fixed rate/receive-floating rate agreements of certain wholly owned subsidiaries. The pay-floating rate/receive-fixed rate and pay-fixed rate/receive-floating rate agreements have terms that offset each other.
|
(2)
|
The calculations of weighted average fixed (pay) leg interest rate and weighted average remaining term on the Company's interest rate swap agreements reflect the impact of the pay-floating rate/receive-fixed rate agreements and the pay-fixed rate/receive-floating rate agreements which offset.
|
|
Year Ended December 31, 2015
|
||
Unrealized loss on derivative instruments designated as cash flow hedges
|
$
|
(16.1
|
)
|
Amortization of loss on terminated derivative instruments designated as cash flow hedges
|
$
|
(2.2
|
)
|
|
Fair Value of Derivative Instruments
(In Millions)
|
||||||||||||||||||||||
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||||||||||
|
December 31, 2015
|
|
December 31, 2014
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||||
Derivative Instrument
|
Balance
Sheet
Location
|
|
Fair
Value
|
|
Balance
Sheet
Location
|
|
Fair
Value
|
|
Balance
Sheet
Location
|
|
Fair
Value
|
|
Balance
Sheet
Location
|
|
Fair
Value
|
||||||||
Interest rate swap contracts, designated as cash flow hedges
|
Fair value of derivative instruments
|
|
$
|
0.1
|
|
|
Fair value of derivative instruments
|
|
$
|
1.7
|
|
|
Fair value of derivative instruments
|
|
$
|
19.2
|
|
|
Fair value of derivative instruments
|
|
$
|
9.4
|
|
Interest rate swap contracts, not designated
|
Fair value of derivative instruments
|
|
—
|
|
|
Fair value of derivative instruments
|
|
0.1
|
|
|
Fair value of derivative instruments
|
|
1.1
|
|
|
Fair value of derivative instruments
|
|
1.0
|
|
||||
Foreign exchange contracts, not designated
|
Fair value of derivative instruments
|
|
—
|
|
|
Fair value of derivative instruments
|
|
0.1
|
|
|
Fair value of derivative instruments
|
|
—
|
|
|
Fair value of derivative instruments
|
|
—
|
|
||||
Total derivatives
|
|
|
$
|
0.1
|
|
|
|
|
$
|
1.9
|
|
|
|
|
$
|
20.3
|
|
|
|
|
$
|
10.4
|
|
|
Effect of Derivative Instruments on Consolidated Statements of Income and
Consolidated Statements of Comprehensive Income
(In Millions)
|
||||||||||||
|
|
|
Year Ended December 31,
|
||||||||||
|
Location of Loss (Gain) on Derivative Instruments
|
|
|||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||||
Realized loss on interest rate swap agreements
|
Interest expense
|
|
$
|
20.6
|
|
|
$
|
15.1
|
|
|
$
|
12.3
|
|
Amortization of realized net loss on terminated derivative instruments, designated as cash flow hedges
|
Interest expense
|
|
2.6
|
|
|
2.5
|
|
|
3.0
|
|
|||
Change in fair value of derivatives, designated as cash flow hedges
|
Other comprehensive income
|
|
31.0
|
|
|
52.1
|
|
|
(18.0
|
)
|
|||
Net loss (gain) on interest rate swaps, not designated
|
Net loss (gain) on interest rate swaps
|
|
0.2
|
|
|
0.8
|
|
|
(8.9
|
)
|
|||
Foreign exchange agreements, not designated
|
Administrative expenses
|
|
—
|
|
|
0.1
|
|
|
0.3
|
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
Gross finance lease receivables (1)
|
$
|
211,530
|
|
|
$
|
267,720
|
|
Allowance on gross finance lease receivables
|
(805
|
)
|
|
(1,056
|
)
|
||
Gross finance lease receivables, net of allowance
|
210,725
|
|
|
266,664
|
|
||
Unearned income (2)
|
(32,988
|
)
|
|
(46,792
|
)
|
||
Net investment in finance leases (3)
|
$
|
177,737
|
|
|
$
|
219,872
|
|
(1)
|
At the inception of the lease, the Company records the total minimum lease payments, executory costs, if any, and unguaranteed residual value as gross finance lease receivables. The gross finance lease receivable is reduced as customer payments are received. The unguaranteed residual value is generally equal to the purchase option at the end of the lease. Approximately
$2.6 million
and
$5.6 million
of unguaranteed residual value at
December 31, 2015
and
2014
, respectively, were included in gross finance lease receivables. There were
no
executory costs included in gross finance lease receivables as of
December 31, 2015
and
2014
.
|
(2)
|
The difference between the gross finance lease receivable and the fair value of the equipment at the lease inception is recorded as unearned income. Unearned income together with initial direct costs, are amortized to income over the lease term so as to produce a constant periodic rate of return. There were
no
unamortized initial direct costs as of
December 31, 2015
and
2014
.
|
(3)
|
As of
December 31, 2015
and
2014
, approximately
52%
and
48%
, respectively, of the Company's net investment in finance leases were with Hapag Lloyd AG, and approximately
15%
and
19%
, respectively, of the Company’s net investment in finance leases were with Mediterranean Shipping Company.
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
Tier 1
|
$
|
179,909
|
|
|
$
|
244,136
|
|
Tier 2
|
31,621
|
|
|
23,584
|
|
||
Tier 3
|
—
|
|
|
—
|
|
||
Gross finance lease receivables
|
$
|
211,530
|
|
|
$
|
267,720
|
|
|
Beginning
Balance
|
|
Additions/
(Reversals)
|
|
Other (a)
|
|
Ending
Balance
|
||||||||
Finance Lease—Allowance for doubtful accounts:
|
|
|
|
|
|
|
|
||||||||
For the year ended December 31, 2015
|
$
|
1,056
|
|
|
$
|
(251
|
)
|
|
$
|
—
|
|
|
$
|
805
|
|
For the year ended December 31, 2014
|
$
|
1,057
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
1,056
|
|
For the year ended December 31, 2013
|
$
|
897
|
|
|
$
|
159
|
|
|
$
|
1
|
|
|
$
|
1,057
|
|
Record Date
|
Payment Date
|
|
Aggregate
Payment
|
|
Per Share
Payment
|
December 2, 2015
|
December 23, 2015
|
|
$14.8 Million
|
|
$0.45
|
September 2, 2015
|
September 23, 2015
|
|
$23.7 Million
|
|
$0.72
|
June 3, 2015
|
June 24, 2015
|
|
$23.7 Million
|
|
$0.72
|
March 3, 2015
|
March 24, 2015
|
|
$23.7 Million
|
|
$0.72
|
December 2, 2014
|
December 23, 2014
|
|
$23.8 Million
|
|
$0.72
|
September 3, 2014
|
September 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
June 3, 2014
|
June 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
March 3, 2014
|
March 24, 2014
|
|
$24.2 Million
|
|
$0.72
|
|
Options
|
|
Weighted
Average Exercise Price |
|
Weighted
Average Remaining Life (Yrs) |
|
Aggregate
Intrinsic Value ($ in 000’s) |
Outstanding: January 1, 2015
|
27,891
|
|
$18.00
|
|
0.8
|
|
$713
|
Granted
|
—
|
|
$—
|
|
—
|
|
$—
|
Exercised
|
(2,101)
|
|
$18.00
|
|
—
|
|
$44
|
Forfeited
|
(25,790)
|
|
$—
|
|
—
|
|
$—
|
Outstanding: December 31, 2015
|
—
|
|
$—
|
|
—
|
|
$—
|
Exercisable: December 31, 2015
|
—
|
|
$—
|
|
—
|
|
$—
|
|
Number of
shares
outstanding
|
|
Weighted
Average
Grant date
fair value
|
Nonvested at January 1, 2015
|
372,500
|
|
$40.13
|
Granted
|
158,750
|
|
41.24
|
Vested(1)
|
(141,000)
|
|
34.98
|
Nonvested at December 31, 2015
|
390,250
|
|
$42.45
|
|
Cash Flow
Hedges |
|
Foreign
Currency Translation |
|
Accumulated Other Comprehensive (Loss) Income
|
||||||
Balance as of December 31, 2013
|
$
|
10,959
|
|
|
$
|
(889
|
)
|
|
$
|
10,070
|
|
Change in fair value of derivative instruments designated as cash flow hedges
|
(33,814
|
)
|
|
—
|
|
|
(33,814
|
)
|
|||
Reclassification of realized loss on interest rate swap agreements designated as cash flow hedges
|
9,106
|
|
|
—
|
|
|
9,106
|
|
|||
Amortization of net loss on derivative instruments previously designated as cash flow hedges
|
1,604
|
|
|
—
|
|
|
1,604
|
|
|||
Foreign currency translation adjustment
|
—
|
|
|
(215
|
)
|
|
(215
|
)
|
|||
Other comprehensive (loss)
|
(23,104
|
)
|
|
(215
|
)
|
|
(23,319
|
)
|
|||
Balance as of December 31, 2014
|
$
|
(12,145
|
)
|
|
$
|
(1,104
|
)
|
|
$
|
(13,249
|
)
|
|
Cash Flow
Hedges
|
|
Foreign
Currency
Translation
|
|
Accumulated Other Comprehensive (Loss)
|
||||||
Balance as of December 31, 2014
|
$
|
(12,145
|
)
|
|
$
|
(1,104
|
)
|
|
$
|
(13,249
|
)
|
Change in fair value of derivative instruments designated as cash flow hedges
|
(20,038
|
)
|
|
—
|
|
|
(20,038
|
)
|
|||
Reclassification of realized loss on interest rate swap agreements designated as cash flow hedges
|
12,588
|
|
|
—
|
|
|
12,588
|
|
|||
Amortization of net loss on derivative instruments previously designated as cash flow hedges
|
1,697
|
|
|
—
|
|
|
1,697
|
|
|||
Foreign currency translation adjustment
|
—
|
|
|
(193
|
)
|
|
(193
|
)
|
|||
Other comprehensive (loss)
|
(5,753
|
)
|
|
(193
|
)
|
|
(5,946
|
)
|
|||
Balance as of December 31, 2015
|
$
|
(17,898
|
)
|
|
$
|
(1,297
|
)
|
|
$
|
(19,195
|
)
|
|
Balance as of December 31, 2015
|
|
Balance as of December 31, 2014
|
|
Affected Line Item
in the Consolidated
Statements of Income
|
||||
Realized loss on interest rate swap agreements, designated as cash flow hedges
|
$
|
19,472
|
|
|
$
|
13,895
|
|
|
Interest and debt expense
|
Amortization of net loss on derivative instruments previously designated as cash flow hedges
|
2,618
|
|
|
2,479
|
|
|
Interest and debt expense
|
||
Amounts reclassified from Accumulated other comprehensive loss before income tax
|
22,090
|
|
|
16,374
|
|
|
Income before income taxes
|
||
Income tax (benefit)
|
(7,805
|
)
|
|
(5,664
|
)
|
|
Income tax expense
|
||
Amounts reclassified from Accumulated other comprehensive loss
|
$
|
14,285
|
|
|
$
|
10,710
|
|
|
Net income
|
•
|
Equipment leasing—the Company owns, leases and ultimately disposes of containers and chassis from its lease fleet, as well as manages leasing activities for containers owned by third parties.
|
•
|
Equipment trading—the Company purchases containers from shipping line customers, and other sellers of containers, and resells these containers to container retailers and users of containers for storage or one-way shipment. Included in the Equipment trading segment revenues are leasing revenues from equipment purchased for resale that is currently on lease until the containers are dropped off.
|
Year Ended December 31, 2015
|
Equipment
Leasing |
|
Equipment
Trading |
|
Totals
|
||||||
Total leasing revenues
|
$
|
598,020
|
|
|
$
|
9,984
|
|
|
$
|
608,004
|
|
Trading margin
|
—
|
|
|
4,194
|
|
|
4,194
|
|
|||
Net (loss) on sale of leasing equipment
|
(13,646
|
)
|
|
—
|
|
|
(13,646
|
)
|
|||
Depreciation and amortization expense
|
241,104
|
|
|
1,434
|
|
|
242,538
|
|
|||
Interest and debt expense
|
116,244
|
|
|
2,036
|
|
|
118,280
|
|
|||
Income before income taxes(1)
|
128,259
|
|
|
9,286
|
|
|
137,545
|
|
|||
Equipment held for sale at December 31
|
55,727
|
|
|
19,172
|
|
|
74,899
|
|
|||
Goodwill at December 31
|
73,523
|
|
|
1,000
|
|
|
74,523
|
|
|||
Total assets at December 31
|
4,380,657
|
|
|
53,419
|
|
|
4,434,076
|
|
|||
Purchases of leasing equipment and investments in finance leases(2)
|
684,283
|
|
|
19,895
|
|
|
704,178
|
|
Year Ended December 31, 2014
|
Equipment
Leasing |
|
Equipment
Trading |
|
Totals
|
||||||
Total leasing revenues
|
$
|
581,421
|
|
|
$
|
12,585
|
|
|
$
|
594,006
|
|
Trading margin
|
—
|
|
|
7,190
|
|
|
7,190
|
|
|||
Net gain on sale of leasing equipment
|
6,987
|
|
|
—
|
|
|
6,987
|
|
|||
Depreciation and amortization expense
|
223,487
|
|
|
1,266
|
|
|
224,753
|
|
|||
Interest and debt expense
|
107,050
|
|
|
2,215
|
|
|
109,265
|
|
|||
Income before income taxes(1)
|
180,356
|
|
|
15,122
|
|
|
195,478
|
|
|||
Equipment held for sale at December 31
|
28,906
|
|
|
30,955
|
|
|
59,861
|
|
|||
Goodwill at December 31
|
73,523
|
|
|
1,000
|
|
|
74,523
|
|
|||
Total assets at December 31
|
4,175,212
|
|
|
66,835
|
|
|
4,242,047
|
|
|||
Purchases of leasing equipment and investments in finance leases(2)
|
668,028
|
|
|
2,501
|
|
|
670,529
|
|
Year Ended December 31, 2013
|
Equipment
Leasing |
|
Equipment
Trading |
|
Totals
|
||||||
Total leasing revenues
|
$
|
556,690
|
|
|
$
|
13,163
|
|
|
$
|
569,853
|
|
Trading margin
|
—
|
|
|
10,278
|
|
|
10,278
|
|
|||
Net gain on sale of leasing equipment
|
26,751
|
|
|
—
|
|
|
26,751
|
|
|||
Depreciation and amortization expense
|
203,157
|
|
|
1,916
|
|
|
205,073
|
|
|||
Interest and debt expense
|
109,175
|
|
|
2,550
|
|
|
111,725
|
|
|||
Income before income taxes(1)
|
198,210
|
|
|
17,708
|
|
|
215,918
|
|
(1)
|
Segment income before income taxes excludes net losses on interest rate swaps of
$0.2 million
, net losses on interest rate swaps of
$0.8 million
, and net gains on interest swaps of
$8.9 million
for the years ended
December 31, 2015
,
2014
, and
2013
, respectively, and the write-off of deferred financing costs of
$0.9 million
,
$5.2 million
, and
$4.0 million
for the years ended
December 31, 2015
,
2014
, and
2013
, respectively.
|
(2)
|
Represents cash disbursements for purchases of leasing equipment and investments in finance lease as reflected in the consolidated statements of cash flows for the periods indicated, but excludes cash flows associated with the purchase of equipment held for resale.
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Total revenues:
|
|
|
|
|
|
||||||
United States of America
|
$
|
42,602
|
|
|
$
|
34,206
|
|
|
$
|
32,506
|
|
Asia
|
286,209
|
|
|
274,467
|
|
|
247,353
|
|
|||
Europe
|
264,147
|
|
|
263,723
|
|
|
265,845
|
|
|||
Other International
|
15,046
|
|
|
21,610
|
|
|
24,149
|
|
|||
Total
|
$
|
608,004
|
|
|
$
|
594,006
|
|
|
$
|
569,853
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Total revenues:
|
|
|
|
|
|
||||||
United States of America
|
$
|
11,393
|
|
|
$
|
8,724
|
|
|
$
|
7,719
|
|
Asia
|
26,993
|
|
|
26,794
|
|
|
39,965
|
|
|||
Europe
|
12,227
|
|
|
17,946
|
|
|
11,964
|
|
|||
Other International
|
11,582
|
|
|
2,972
|
|
|
13,356
|
|
|||
Total
|
$
|
62,195
|
|
|
$
|
56,436
|
|
|
$
|
73,004
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Impairment (loss) on equipment held for sale
|
$
|
(14,020
|
)
|
|
$
|
(4,326
|
)
|
|
$
|
(1,838
|
)
|
Gain on sale of equipment-net of selling costs
|
374
|
|
|
11,313
|
|
|
28,589
|
|
|||
Net (loss) gain on sale of leasing equipment
|
$
|
(13,646
|
)
|
|
$
|
6,987
|
|
|
$
|
26,751
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Deferred taxes:
|
|
|
|
|
|
||||||
Federal
|
$
|
47,954
|
|
|
$
|
65,020
|
|
|
$
|
76,761
|
|
State
|
412
|
|
|
587
|
|
|
1,105
|
|
|||
Foreign
|
(133
|
)
|
|
(146
|
)
|
|
(167
|
)
|
|||
Total
|
$
|
48,233
|
|
|
$
|
65,461
|
|
|
$
|
77,699
|
|
|
Year Ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
Federal income taxes at the statutory rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income taxes (net of Federal income tax benefit)
|
0.2
|
|
|
0.2
|
|
|
0.3
|
|
Foreign income taxed at other than the Federal statutory rate
|
0.1
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
Change in enacted tax rates(1)
|
—
|
|
|
(0.6
|
)
|
|
(0.1
|
)
|
Effect of permanent differences and other, net
|
—
|
|
|
—
|
|
|
0.1
|
|
Effective income tax rate
|
35.3
|
%
|
|
34.5
|
%
|
|
35.2
|
%
|
(1)
|
Several states have enacted changes to their apportionment factors. These changes resulted in a decrease in the Company’s overall effective tax rate for
2014
. The Company adjusts its deferred tax assets and liabilities through income tax expense on the date which rate changes are enacted. Accordingly, the Company recorded a reduction of
$1.2 million
in
2014
in income tax expense to reflect the impact of these changes in state apportionment factors.
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Deferred income tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
192,139
|
|
|
$
|
134,329
|
|
Allowance for losses
|
827
|
|
|
959
|
|
||
Derivative instruments
|
10,147
|
|
|
7,556
|
|
||
Deferred income
|
8,561
|
|
|
9,230
|
|
||
Accrued liabilities and other
|
873
|
|
|
99
|
|
||
|
212,547
|
|
|
152,173
|
|
||
Deferred income tax liabilities:
|
|
|
|
||||
Accelerated depreciation
|
650,027
|
|
|
542,447
|
|
||
Goodwill amortization
|
18,574
|
|
|
16,720
|
|
||
Derivative instruments
|
69
|
|
|
673
|
|
||
Other
|
—
|
|
|
3,340
|
|
||
|
668,670
|
|
|
563,180
|
|
||
Net deferred income tax liability
|
$
|
456,123
|
|
|
$
|
411,007
|
|
Years ending December 31,
|
|
||
2016
|
$
|
1,769
|
|
2017
|
1,294
|
|
|
2018
|
1,149
|
|
|
2019
|
1,996
|
|
|
2020 and thereafter
|
97
|
|
|
Total
|
$
|
6,305
|
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
|
(In thousands, except per share amounts)
|
||||||||||||||
2015
|
|
|
|
|
|
|
|
||||||||
Total leasing revenues
|
$
|
148,975
|
|
|
$
|
150,838
|
|
|
$
|
154,426
|
|
|
$
|
153,765
|
|
Trading margin
|
$
|
1,414
|
|
|
$
|
1,521
|
|
|
$
|
1,191
|
|
|
$
|
68
|
|
Net (loss) on sale of leasing equipment
|
$
|
(1,449
|
)
|
|
$
|
(660
|
)
|
|
$
|
(2,854
|
)
|
|
$
|
(8,683
|
)
|
Net income
|
$
|
25,757
|
|
|
$
|
26,670
|
|
|
$
|
22,511
|
|
|
$
|
13,274
|
|
Net income per basic common share
|
$
|
0.78
|
|
|
$
|
0.81
|
|
|
$
|
0.69
|
|
|
$
|
0.40
|
|
Net income per diluted common share
|
$
|
0.78
|
|
|
$
|
0.81
|
|
|
$
|
0.68
|
|
|
$
|
0.40
|
|
2014
|
|
|
|
|
|
|
|
||||||||
Total leasing revenues
|
$
|
144,767
|
|
|
$
|
144,723
|
|
|
$
|
150,524
|
|
|
$
|
153,992
|
|
Trading margin
|
$
|
1,648
|
|
|
$
|
2,215
|
|
|
$
|
1,713
|
|
|
$
|
1,614
|
|
Net gain on sale of leasing equipment
|
$
|
3,096
|
|
|
$
|
2,461
|
|
|
$
|
870
|
|
|
$
|
560
|
|
Net income
|
$
|
30,011
|
|
|
$
|
29,362
|
|
|
$
|
32,617
|
|
|
$
|
32,055
|
|
Net income per basic common share
|
$
|
0.89
|
|
|
$
|
0.87
|
|
|
$
|
0.97
|
|
|
$
|
0.97
|
|
Net income per diluted common share
|
$
|
0.89
|
|
|
$
|
0.87
|
|
|
$
|
0.97
|
|
|
$
|
0.96
|
|
|
Beginning
Balance
|
|
Additions/
(Reversals)
|
|
(Write-offs)/
Reversals
|
|
Other(a)
|
|
Ending
Balance
|
||||||||||
Finance Lease-Allowance for doubtful accounts:
|
|
|
|
|
|
|
|
|
|
||||||||||
For the year ended December 31, 2015
|
$
|
1,056
|
|
|
$
|
(251
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
805
|
|
For the year ended December 31, 2014
|
$
|
1,057
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
1,056
|
|
For the year ended December 31, 2013
|
$
|
897
|
|
|
$
|
159
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1,057
|
|
Accounts Receivable-Allowance for doubtful accounts:
|
|
|
|
|
|
|
|
|
|
||||||||||
For the year ended December 31, 2015
|
$
|
978
|
|
|
$
|
385
|
|
|
$
|
(46
|
)
|
|
$
|
(3
|
)
|
|
$
|
1,314
|
|
For the year ended December 31, 2014
|
$
|
948
|
|
|
$
|
131
|
|
|
$
|
(99
|
)
|
|
$
|
(2
|
)
|
|
$
|
978
|
|
For the year ended December 31, 2013
|
$
|
692
|
|
|
$
|
299
|
|
|
$
|
(44
|
)
|
|
$
|
1
|
|
|
$
|
948
|
|
Allowance for equipment loss:
|
|
|
|
|
|
|
|
|
|
||||||||||
For the year ended December 31, 2015
|
$
|
571
|
|
|
$
|
—
|
|
|
$
|
(364
|
)
|
|
$
|
—
|
|
|
$
|
207
|
|
For the year ended December 31, 2014
|
$
|
1,348
|
|
|
$
|
89
|
|
|
$
|
(866
|
)
|
|
$
|
—
|
|
|
$
|
571
|
|
For the year ended December 31, 2013
|
$
|
21
|
|
|
$
|
2,369
|
|
|
$
|
(1,046
|
)
|
|
$
|
4
|
|
|
$
|
1,348
|
|
(a)
|
Primarily relates to the effect of foreign currency translation.
|
Lender
|
Commitment Dollar Amount
|
Commitment Percentage
|
SunTrust Bank
|
$52,875,000.0
|
12.98741%
|
ING Belgium SA/NV
|
$52,875,000.0
|
12.98741%
|
Mizuho Bank, Ltd.
|
$37,518,750.0
|
9.21554%
|
ABN Amro Capital USA LLC
|
$34,518,750.0
|
8.47866%
|
BNP Paribas
|
$33,518,750.0
|
8.23304%
|
Bank of America, N.A.
|
$33,518,750.0
|
8.23304%
|
DBS Bank Ltd.
|
$32,000,000.0
|
7.85999%
|
Santander Bank, N.A.
|
$28,518,750.0
|
7.00491%
|
Wells Fargo Bank N.A.
|
$28,518,750.0
|
7.00491%
|
Credit Industriel et Commercial
|
$17,550,000.0
|
4.31072%
|
Branch Banking and Trust Company
|
$17,000,000.0
|
4.17562%
|
JPMorgan Chase Bank, N.A.
|
$10,275,000.0
|
2.52379%
|
Citibank, National Association
|
$10,275,000.0
|
2.52379%
|
Land Bank of Taiwan, New York Branch
|
$6,581,250.0
|
1.61652%
|
Hua Nan Commercial Bank, Ltd. New York Agency
|
$6,581,250.0
|
1.61652%
|
PNC Bank, National Association
|
$5,000,000.0
|
1.22812%
|
|
|
|
Total
|
$407,125,000.0
|
|
Name
|
|
Jurisdiction
|
TAL International Container Corporation
|
|
Delaware
|
Trans Ocean Ltd.
|
|
Delaware
|
Trans Ocean Container Corporation
|
|
Delaware
|
Spacewise Inc.
|
|
Delaware
|
TAL Advantage I LLC
|
|
Delaware
|
TAL Advantage III LLC
|
|
Delaware
|
TAL Advantage V LLC
|
|
Delaware
|
TAL International Container Pty. Limited
|
|
Australia
|
TAL Sales & Marketing Planning (Shanghai) Co., Ltd.
|
|
China
|
TAL International Container (HK) Limited
|
|
Hong Kong
|
TAL International Container PTE Ltd.
|
|
Singapore
|
Box Rent, Inc.
|
|
Delaware
|
Intermodal Equipment Inc.
|
|
Delaware
|
TAL International Container NV
|
|
Belgium
|
TAL International Container SRL
|
|
Italy
|
Greybox Services I Ltd.
|
|
United Kingdom
|
ICS Terminals (UK) Limited
|
|
United Kingdom
|
TAL International Structured Inc.
|
|
Delaware
|
|
|
New York, New York
|
|
February 29, 2016
|
|
1.
|
I have reviewed this Annual Report on Form 10-K of TAL International Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15(d)-15(f) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ BRIAN M. SONDEY
Brian M. Sondey
Chairman, President and Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of TAL International Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15(d)-15(f) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ JOHN BURNS
John Burns
Senior Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: February 29, 2016
|
/s/ BRIAN M. SONDEY
Brian M. Sondey
Chairman, President and Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: February 29, 2016
|
/s/ JOHN BURNS
John Burns
Senior Vice President and Chief Financial Officer
|