Use these links to rapidly review the document ~~TABLE~~Table OFof ~~CONTENTS~~Contents ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES INDEX TO FINANCIAL STATEMENTS ~~TRAC Intermodal LLC and Subsidiaries Years Ended December 31, 2015, 2014 and 2013~~

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

ý		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For The Fiscal year Ended December 31, 2015
For The Fiscal year Ended December 31, 2016
Or
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from to

Commission file number 1333-~~11862~~188177

TRAC Intermodal LLC
(Exact name of registrant as specified in the charter)


Delaware (State or other jurisdiction of incorporation or organization)		46-0648957 (I.R.S. Employer Identification Number)
750 College Road East, Princeton, New Jersey (Address of principal executive office)		08540 (Zip Code)

(609) 452-8900
(Registrant's telephone number including area code)

Securities registered pursuant to section 12(g) of the Act: None.

Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No ý

Indicate by check mark whether the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No ý

Indicate by check whether ~~üwhether~~ the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirement for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of the Form 10-K or any amendment to the Form 10-K. Yes ý No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerate filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.


Large accelerated filer o		Accelerated filer o		Non-accelerated filer ý

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý

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TRAC Intermodal LLC and Subsidiaries ~~Table of Contents~~


	Part I
ITEM 1	Business	4
ITEM 1A	Risk Factors	20
ITEM 1B	Unresolved Staff Comments	43
ITEM 2	Properties	43
ITEM 3	Legal Proceedings	43
ITEM 4	Mine Safety Disclosure	43
	Part II
ITEM 5	Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	43
ITEM 6	Selected Financial Data	44
ITEM 7	Management's Discussion and Analysis of Financial Condition and Results of Operations	45
ITEM 7A	Quantitative and Qualitative Disclosures About Market Risk	79
ITEM 8	Financial Statements and Supplementary Data	81
ITEM 9	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	81
ITEM 9A	Controls and Procedures	81
ITEM 9B	Other Information	81
	Part III
ITEM 10	Directors, Executive Officers and Corporate Governance	82
ITEM 11	Executive Compensation	84
ITEM 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	88
ITEM 13	Certain Relationships and Related Transactions and Director Independence	90
ITEM 14	Principal Accounting Fees and Services	92
	Part IV
ITEM 15	Exhibits and Financial Statement Schedules	93
SIGNATURES		98

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Part I
ITEM 1	Business	4
ITEM 1A	Risk Factors	20
ITEM 1B	Unresolved Staff Comments	42
ITEM 2	Properties	42
ITEM 3	Legal Proceedings	42
ITEM 4	Mine Safety Disclosure	42
Part II
ITEM 5	Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	43
ITEM 6	Selected Financial Data	43
ITEM 7	Management's Discussion and Analysis of Financial Condition and Results of Operations	45
ITEM 7A	Quantitative and Qualitative Disclosures About Market Risk	78
ITEM 8	Financial Statements and Supplementary Data	80
ITEM 9	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	80
ITEM 9A	Controls and Procedures	80
ITEM 9B	Other Information	80
Part III
ITEM 10	Directors, Executive Officers and Corporate Governance	81
ITEM 11	Executive Compensation	83
ITEM 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	88
ITEM 13	Certain Relationships and Related Transactions and Director Independence	90
ITEM 14	Principal Accounting Fees and Services	92
Part IV
ITEM 15	Exhibits and Financial Statement Schedules	93
ITEM 16	Form 10-K Summary	97
SIGNATURES		98

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This annual report contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, objectives, goals, projections, strategies, future events or performance, and underlying assumptions and other statements, which are not statements of historical facts. Forward looking statements may be identified by the use of words like "expect," "anticipate," "intend," "forecast," "outlook," "will," "may," "might," "potential," "likely," "target," "plan," "contemplate," "seek," "attempt," "should," "could," "would" or expressions of similar meaning. Forward-looking statements reflect management's good faith evaluation of information currently available and are based on its current expectations and assumptions regarding its business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Specific factors that may impact performance or other predictions of future actions have, in many but not all cases, been identified in connection with specific forward-looking statements. TRAC Intermodal LLC's (the "Company," "we" or "TRAC") actual results may differ materially from those contemplated by the forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. We caution you therefore against relying on any of these forward-looking statements.

Important factors that could cause actual results to differ materially from those in the forward-looking statements include economic, business, competitive, market and regulatory conditions and the following:

•: the volume of world trade due to economic, political, or other factors;
•: the demand for chassis;
•: operating costs, including the cost of maintaining and repairing chassis, the cost of labor rates, the cost of parts and materials and the imposition of fees and other charges by the host locations at which we operate our chassis pools;
•: increased regulatory costs;
•: defaults by customers, which would decrease revenues and increase storage, collection, and recovery expenses and require payment to lenders sooner than anticipated;
•: the inability of one or more customers to meet their obligations or decreased customer creditworthiness;
•: the ability to mitigate any risk associated with the ongoing transition of shipping lines to the motor carrier model;
•: the ability to mitigate any risk associated with the Company's providing logistics services related to drayage;
•: expansion of the Company's business to provide logistics services and repair services through its service centers and mobile service units;
•: the Company's substantial amount of indebtedness;
•: the Company's ability to incur additional debt;
•: the limitation on flexibility in operating the business arising from restrictions from debt agreements;
•: the Company's ability to service its debt or to obtain additional financing;
•: the Company's ability to secure its customers' confidential and credit card information or other private data relating to its employees, suppliers or itself;

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•: the decision by potential and existing customers to buy rather than lease chassis;
•: the effect of the Company's customers' decision to shift to short-term leasing and transition to the motor carrier model on long-term leasing and direct finance leasing products;
•: the impact of consolidation within the container shipping industry;
•: the Company's ability to compete successfully in the chassis leasing industry;
•: the impact of the credit markets on the worldwide demand for goods and, in turn, on the demand for chassis;
•: the Company's ability to re-lease chassis after their initial long-term lease;
•: the impact of liens on equipment;
•: changes in market price, availability, or transportation costs of, or import duties on, equipment manufactured in China or Mexico;
•: a decrease in the availability of storage space for chassis and a resulting increase in depot costs;
•: the Company's ability to maintain qualified personnel;
•: strikes, work stoppages or slowdowns by draymen, truckers, longshoremen and railroad workers;
•: the Company's ability to maintain its relationship with employees, and thereby avoid unionization efforts, labor shortages, disruptions or stoppages;
•: the Company's ability or the ability of the Company's lessees to maintain sufficient insurance to cover losses that may occur to chassis;
•: the impact of litigation that is not covered by insurance;
•: the Company's ability to estimate and maintain sufficient self-insurance for employee health care benefits;
•: the extent of any payments under the Company's indemnification agreements;
•: the impact of accidents or incidents or mismanagement of its fleet on the Company's reputation and financial results;
•: the impact of recalls and other investigations;
•: the willingness and ability of manufacturers or remanufacturers of the Company's equipment to honor warranties covering defects;
•: the impact of federal roadability rules and regulations for intermodal equipment providers ("IEP");
•: the impact of environmental liability;
•: the failure or operational interruption of information technology systems required to conduct its business;
•: the failure to adequately protect the Company's intellectual property rights;
•: the disclosure requirement exemptions we utilize based on our status as an "emerging growth company" under the JOBS Act
•: the impact of inherent, potential, or perceived conflicts of interest created by relationships and transactions with members of management, members or shareholders and their respective affiliates;

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•: risks inherent in international operations, including uncertainty about the jurisdictions in which enforcement might be sought and the political, environmental, and economic stability of particular countries or regions;
•: the impact on the Company's earnings of increases in prevailing interest rates;
•: the Company's ability to integrate acquisitions and to realize the anticipated benefits of any such potential future acquisitions;
•: counterparty risk arising in the Company's hedging strategies;
•: the impact of a new standard for lease accounting;
•: adverse changes in U.S. tax rules;
•: terrorist attacks, wars, uprisings or hostilities; and
•: other risks described in the "Risk Factors" section of this report.

Please also refer to Item 1A. Risk Factors to Part I of this report. All of the above factors are difficult to predict, contain uncertainties that may materially affect actual results and may be beyond the Company's control. New factors emerge from time to time and it is not possible for management to predict all such factors or to assess the effect of each such new factor on its business. Except to fulfill the Company's obligations under the U.S. securities laws, we undertake no obligation to update any such statement to reflect events or circumstances after the date on which it is made.

Although the Company believes that assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore any of these statements included herein may prove to be inaccurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the results or conditions described in such statements or objectives and plans will be achieved.

WEBSITE AND ACCESS TO COMPANY'S REPORTS

Our Internet website can be found at www.tracintermodal.com. Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") are available free of charge through our website as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. Our Corporate Governance Guidelines, Code of Business Conduct and Ethics, and Audit Committee charter are also available on our website.

The information on our website is not part of, or incorporated by reference, into this report, or any other report we file with, or furnish to, the SEC.

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PART I

ITEM 1. BUSINESS

General Overview

We believe we are the largest intermodal chassis solutions provider, measured by total assets, for domestic and international transportation companies in North America. A chassis is a fabricated steel frame with wheels, axles, brakes and lights that enables a truck to haul domestic and marine freight containers. Chassis are an integral component of intermodal transportation by facilitating the movement of goods via domestic and marine containers over land between ocean-going vessels, railroad ramps, warehouses and other delivery points served by motor carriers. Chassis usage cannot be avoided when moving containers from ports to their ultimate destination—the point of sale.

Our principal business is providing marine and domestic chassis on both long-term leases and short-term rental agreements to a diversified customer base including the world's leading shipping lines, Class I railroads, major U.S. intermodal transportation companies and motor carriers. We have the largest chassis fleet in North America based on publically available information and number one market share in both marine and domestic segments. We have a broad operating footprint with approximately ~~600~~580 marine, ~~160~~170 domestic and 60 depot locations across North America. Headquartered in Princeton, New Jersey, we operate under the name TRAC Intermodal and employ approximately ~~660~~700 people throughout the United States. For the year ended December 31, ~~2015~~2016, we generated total revenues of $~~691~~669.42 million, net income of $2619.79 million and Adjusted EBITDA of $~~227~~195.28 million. See Item 7. "Non-GAAP Measures" for a reconciliation of non-GAAP measures to the most directly comparable U.S. GAAP measures.

Our fleet of equipment primarily consists of marine and domestic chassis. These assets are owned, leased-in or managed by us on behalf of third-party owners. As of December 31, ~~2015~~2016, we owned, leased-in or managed a fleet of approximately ~~311~~303,~~375~~246 chassis and units available for remanufacture. The net book value of our owned equipment was approximately $1.4542 billion. Our active fleet had an average age of 13.35 years as of December 31, ~~2015~~2016.

We operate our business through two operating segments: the Marine Market segment and the Domestic Market segment. Segment information for the years ended December 31, ~~2015~~2016, ~~2014~~2015 and ~~2013~~2014 are included in Part II, Item 7, of this Form 10-K and Note 13 to our Consolidated Financial Statements.

•: Marine Market segment—primarily serving shipping lines and motor carriers with 20', 40' and 45' foot chassis. These chassis are used in the transport of dry or refrigerated marine shipping containers of the same size carrying goods between port terminals and/or railroad ramps and retail or wholesale warehouses or store locations, principally in the United States. We offer customers both long-term leases and short-term rental agreements. As of December 31, 2016, our active fleet included 184,307 marine chassis.
•: Domestic Market segment—primarily serving railroads and major U.S. intermodal transportation companies with 53' chassis. These chassis are used in the transport of domestic shipping containers of the same size carrying goods between railroad ramps and retail or wholesale warehouses or store locations, principally in the United States. We offer customers both long-term leases and short-term rental agreements. As of December 31, 2016, our active fleet included 80,182 domestic chassis.

Additionally, we have 3338,~~282~~757 units available for remanufacture. These units are pairs of axles and chassis that are no longer in leasable condition. We expect to make use of many of these units in our remanufacturing process and eventually return them to active fleet status.

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Formation

TRAC Intermodal LLC is a Delaware limited liability company that was formed on July 12, 2012 in connection with the issuance of senior secured Notes (as defined herein). The Company conducts its business through its 100% owned subsidiary, Interpool, Inc. ("Interpool") and its consolidated subsidiaries. The Company has no operations of its own so it is dependent upon the cash flows of its subsidiaries to meet its obligations under the Notes. Since the proceeds from the Notes were used to repay debt owed by Interpool, an intercompany note was entered into between TRAC and Interpool with terms identical to the Notes. The proceeds from the intercompany note arrangement with Interpool will provide the funds for TRAC to service the interest and debt payments due under the Notes.

Interpool, headquartered in Princeton, New Jersey, is a private company wholly -owned by TRAC, which is ultimately owned by Seacastle Inc. ("Seacastle"). Seacastle is owned by private equity funds that are managed by an affiliate of Fortress Investment Group LLC ("Fortress") and by employees of affiliates of Seacastle. Interpool was founded in 1968 as an operating lessor servicing the intermodal transportation equipment industry. Interpool was listed on The New York Stock Exchange as a public company in 1993 and was acquired and taken private by Seacastle in July 2007.

Business strengths

We believe that we have a number of business strengths that will enable us to execute our strategy and successfully grow our business, including the following:

•: Largest intermodal chassis solutions provider in North America. We believe we are the largest intermodal chassis solutions provider, measured by total assets, in North America. We have an estimated market share of 49% among the top three chassis leasing providers as of December 31, 2016. Our closest competitor has a market share of approximately 28% according to our estimates. We believe that our significant size and broad footprint give us a competitive advantage by being able to address our customers' comprehensive chassis demand across the United States. The size of our fleet (with a replacement value of $3.3 billion) and scope of our operations, also allow us to satisfy our customers' chassis demand during peak seasons or surge periods and creates a significant barrier to entry.
•: Large and diverse fleet of active equipment. As of December 31, 2016, we owned or managed an active fleet of 264,489 chassis comprised of 184,307 marine chassis and 80,182 domestic chassis. Our fleet consists of a diverse mix of equipment, including 20', 40', 45', 53', tri-axles 20' and tri-axles 40' chassis. The average age of the active fleet is 13.5 years and our fleet's average expected useful life is approximately 20 years for domestic chassis and 22.5 years for marine chassis. We believe each chassis in our fleet has the potential to be remanufactured at the end of its useful life to provide 20 or more additional years of service at a material cash savings compared to the cost of purchasing a new chassis, while providing the same quality of service as a new chassis.
•: Broad nationwide footprint with a number of exclusive contracts. We operate a nationwide footprint that includes, as of December 31, 2016, approximately 580 marine, 170 domestic and 60 depot locations across North America which allows us to service our customers' nationwide freight movement requirements. Additionally, in many of these locations we are the sole chassis supplier, and as a result, we have the advantage of on-premises access to the port terminals and railroad ramps. In 2015, we had exclusive arrangements with five of the seven Class I railroads that carry freight in the United States to provide this service at many of their railroad ramps. However, later that same year, we were advised by one of the Class I railroads that they would not renew their contract on an exclusive basis when the agreement terminated in 2016. In the fourth quarter of 2016, we signed a non-exclusive agreement with this railroad. Additionally in

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~~with~~2016, uswe were advised by two more Class I railroads with whom we had exclusive arrangements that they did not wish to renew on an exclusive basis. We have already signed a new non-exclusive contract with one of these two railroads and while we are in the early stages of negotiations with the second railroad, we expect to ultimately sign a non-exclusive renewal contract with them as well. We believe that our extensive operating network is difficult to replicate and therefore serves as a competitive advantage.

•: Long operating history with a diversified, loyal customer base. We have a long, successful operating history and an extensive history with our customers, in many cases spanning over 30 years, which provides us with strong relationships at senior levels of management. Our customer base of shipping lines, Class I railroads, U.S. transportation companies and motor carriers is diverse with no single customer accounting for more than 8% of 2016 revenue and the top ten customers accounting for 38% of total revenue in 2016. As of December 31, 2016, we had approximately 3,950 active customers.
•: Predictable and stable cash flows. As of December 31, 2016, 21% of our on-hire fleet was subject to a term lease, direct finance lease or subscription agreement in our chassis pools. Our term lease renewal rate for the year ended December 31, 2016 approximated 68%. We expect the predictability and stability of our term lease renewal rate to be affected by the trend toward pool arrangements which carry higher per diem rates than term and direct finance lease products. Beginning in 2011 and continuing through 2016, several of our lessees have opted to continue renting chassis from us through pool arrangements upon the expiration of their term leases. If we included these rentals, the renewal rate for the year ended December 31, 2016 would be approximately 76%. Our average fleet-wide utilization rate was 92% between 1994 and 2014. This rose to 94.5% for the year ended December 31, 2015 primarily due to our scrapping excess 20' chassis and other measures taken in the second quarter of 2014 to right-size our fleet. For the year ended December 31, 2016, our utilization rate was 92%. See "—Cost effective fleet growth.
•: Strong credit and collection history. We have a strong and long-standing credit and collections history with bad debts representing 1.3% of $2.9 billion in aggregate revenues over the five-year period 2012-2016. During the period 2009-2011, prior to the shift in billings from shipping lines to motor carriers, our bad debts averaged 0.5% of $0.9 billion in aggregate revenues over that three year period. We believe several factors contribute to our low receivable delinquency including a long-tenured and highly experienced collections team with excellent relationships with our largest customers; an experienced credit group with strong industry knowledge of shipping lines, railroads, logistics companies and motor carriers; the essential nature of our product in the movement of our customers' goods and the reality that delinquency of payments could jeopardize our customers' ability to perform under their delivery contracts. We have experienced a minimal default rate—only 13 term lease customers during the period 2011-2016—and we were successful in recovering 98% of our chassis under default. For the year ended December 31, 2016, term lease defaults were minimal.
•: Cost effective fleet growth. Older chassis can generally be remanufactured at the end of their useful life to provide 20 or more additional years of service rather than being replaced by new equipment. Remanufacturing provides a material cash savings since the cash outlay to remanufacture a unit is approximately 75% of the cost of purchasing a new chassis. In addition to the cost savings, another benefit is that an older chassis can be remanufactured into any size unit, which provides excellent flexibility to meet demands of different equipment types as the market changes. During 2016, we remanufactured 99 end-of-life chassis into an equivalent number of 53' domestic chassis. We also remanufactured 459 end-of-life chassis into 434 40' marine chassis and 25 20' marine chassis. During 2015, we remanufactured 2,801 and 1,966

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~~structural~~end-of-life ~~state~~chassis tointo bean ~~more~~equivalent ~~marketable.~~number ~~Refurbishment costs are capitalized and depreciated over the remaining / extended useful life~~ of ~~the~~53' ~~equipment.~~domestic ~~For~~chassis ~~the years ended December 31, 2015~~ and ~~2014,~~ we40' ~~refurbished~~marine ~~2,122 and 549~~ chassis, respectively.

~~Experienced~~Alternatively, chassis ~~management~~meeting ~~team. Our~~certain ~~executive~~age ~~management~~and ~~team~~condition iscriteria ~~highly~~can ~~experienced,~~be ~~has~~refurbished. ~~extensive~~Refurbishments ~~customer~~reflect ~~relationships~~improvements that go beyond preventive maintenance and ~~has~~normal ~~led~~repairs, ~~our~~thus serving to ~~Company successfully~~increase the cash flow generating capability of the refurbished asset. Cash flows are enhanced through aextending ~~variety~~the useful life of ~~industry~~the ~~changes~~asset ~~and~~or ~~economic~~otherwise ~~cycles~~altering its structural state to be more marketable. WeRefurbishment ~~believe~~costs ~~the~~are ~~depth~~capitalized and ~~breadth~~depreciated over the remaining / extended useful life of ~~our~~the ~~executive~~equipment. ~~management~~For ~~team~~the isyears aended ~~key~~December 31, ~~strength~~2016 ~~for~~and ~~our~~2015, ~~business.~~we refurbished 3,151 and 2,122 chassis, respectively.

•: Proprietary technology platform. Over the last decade, we have internally developed a proprietary chassis management software technology called PoolStat®. PoolStat® provides chassis tracking and billing in our chassis pools, as well as a central operating database that coordinates our chassis leasing activities. We developed PoolStat® and maintain full control of the system through our in-house development team. Our experienced IT staff, working closely with our chassis pool management team and our customers, engages in continuous improvement to the system, which possesses the necessary sophistication to operate complex chassis pool functions of demand/supply, inventory control, status, repositioning, billing and maintenance and repair. In 2014, we made a decision to implement an Oracle Enterprise Resource Planning ("ERP") solution along with a customized solution for many functional improvements to Poolstat®. As of December 31, 2016, the project will likely span 12-15 months and will be designed to implement the functional improvements and eliminate inefficiencies in our financial and operational systems. We estimate the incremental costs of the project to be $30 million to $34 million and will be managed and governed by the executive management of the Company.
•: Experienced management team. Our executive management team is highly experienced, has extensive customer relationships and has led our Company successfully through a variety of industry changes and economic cycles. We believe the depth and breadth of our executive management team is a key strength for our business.

Business strategy

Our vision is to be the market leader in providing high quality, comprehensive chassis solutions to the intermodal industry. We plan to execute the following strategy to grow our business:

•: Increase earnings through revenue growth and operating cost control. One of our key initiatives to increase our revenue and improve our financial results is to continue the transition to the "motor carrier model", which was implemented by nearly every major shipping line serving the United States over the past several years. Under the motor carrier model, the shipping lines no longer provide chassis as part of their transportation service to the motor carriers that transport their containers. Instead, the responsibility for chassis provisioning is transferred from the shipping line to the motor carrier. The shift to the motor carrier model affords us the opportunity to lease our chassis directly to motor carriers, rather than to shipping lines that would otherwise provide our chassis for motor carrier usage. As compared to shipping lines, motor carriers are smaller in size, unable to exert similar pricing pressures on us, typically do not own their own chassis and are a greater credit risk. Due to these factors, we are able to charge motor carriers a higher per diem rate than shipping line customers. In addition, we are continuing to focus on penetrating a new customer base, the beneficial cargo owner ("BCO"). BCOs are the importers of record that take physical possession of the goods at the destination. Large retail outlets are often BCOs. We believe that BCOs will want to assume responsibility for procuring chassis that the shipping lines are no longer responsible for under the motor carrier model. We believe that the BCO customer base represents significant growth opportunities and

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we will pursue them as appropriate. Finally, we have continued to focus on improving our operating cost structure through higher fleet utilization, enhanced controls over maintenance and repair expenditures and cost savings from direct purchasing of parts and insourcing of service centers, road service and pool repositioning. We believe that our focus on improving rates and controlling our operating costs will enable us to grow our earnings.

•: Expand the geographic footprint of our chassis pools and chassis fleet. We believe that there are significant opportunities to expand our geographic footprint and grow our business by further expanding our pool network throughout North America. Our extensive experience, systems, chassis fleet and strong customer relationships position us well to grow our business in targeted new markets. We will also selectively bid to acquire the remaining shipping line chassis, the majority of which have already traded, as they transition to the motor carrier model in order to increase the size of our fleet. We believe that a combination of geographic expansion and chassis acquisitions will improve our overall product offering and enhance our competitive position in the market.

Industry overview

The North American economy is dependent on the movement of intermodal container cargo through its major port terminals and railroad ramps. In ~~2015~~ 2016, total North American import and export container volumes reported by port terminals was 3234.0 million twenty-foot equivalent units, which is the standard unit of measure for containers in the marine industry. Total North American container import volumes grew by 43.7% in ~~2015~~2016, while export container volumes ~~decreased~~increased by 32.45% in ~~2015~~2016. Container volumes across major North ~~American~~ American railroads ~~increased~~were ~~3.8% to~~ approximately 15.29 million containers in ~~2015~~2016. According to the Association of American Railroads, in ~~2015~~2016 intermodal container transport accounted for 22% of that year's U.S. railroad revenues. Chassis are an essential component in the intermodal containerized shipping infrastructure and do not require container contents to be continually unloaded and reloaded throughout the supply chain. They are required by shipping lines, railroads, intermodal transportation companies and motor carriers to move shipping containers over land between ocean-going vessels, railroad ramps, warehouses and other delivery points served by motor carriers.

The North American chassis market is large, with a total fleet of approximately ~~759~~749,000 chassis (excluding a logistics company that maintains a proprietary fleet of approximately 7974,000 non-standard specification domestic chassis) and an aggregate new chassis replacement cost of approximately $9.23 billion as of December 31, ~~2015~~2016. Of this total, approximately ~~578~~567,000 chassis are marine chassis for transporting 20', 40' and 45' intermodal containers. The remaining ~~181~~182,000 chassis are domestic chassis, primarily designed for domestic containers with a length of 53' that move almost exclusively on railcars in double-stack service.

The United States has been the only major container market in the world where shipping lines and railroads provide chassis as part of their basic transportation service to their customers, although the industry is transitioning to the motor carrier model where the responsibility for chassis provisioning is transitioning to motor carriers. The demand for chassis in North America is influenced primarily by the volume of containerized international and domestic trade.

Leasing companies own a significant portion of North America's chassis, and we believe the remainder is owned predominantly by shipping lines and railroads. We estimate that as of ~~2015~~2016 approximately 7472% of the North American chassis market is controlled by the top three leasing companies and we expect the trend to continue to move from chassis ownership towards chassis leasing.

Prior to 2004, over 80% of our chassis were on-hire as term lease and direct finance lease products. Beginning in 2004, as the capacity of port terminals and railroad ramps ~~capacity~~ tightened, ~~chassis~~ chassis pools, which increase terminal operating efficiency, became more common. Three other important factors contributed to the increase in chassis pool usage. The first is the increase in domestic container traffic, where many of our major customers do not wish to devote capital or build an administrative presence to operate chassis and thus utilize our nationwide domestic chassis pools. The second is the shipping line industry's response to the freight downturn of 2008 and 2009 and the challenging rate environment beginning in 2011 and still existing today in which shipping lines reduced administrative and operational staff and began increasingly migrating to more operationally efficient chassis pool arrangements. The

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~~third~~traffic, where many of our major customers do not wish to devote capital or build an administrative presence to operate chassis and thus utilize our nationwide domestic chassis pools. The second is the shipping line industry's response to the freight downturn of 2008 and 2009 and the challenging rate environment beginning in 2011 and still existing today in which shipping lines reduced administrative and operational staff and began increasingly migrating to more operationally efficient chassis pool arrangements. The third is the industry's transition to the motor carrier model which replaced term leasing by the shipping lines with chassis pool usage by the motor carriers. As a result, as of December 31, ~~2015~~ 2016, approximately 8284% of our on-hire chassis were earning revenue through chassis pools.

Industry trends / Market growth

•: U.S. container import volume growth. Demand for marine chassis is highly correlated to U.S. container import volumes. According to the Journal of Commerce, the total U.S. container import volume grew by 3.7%, 2.7%, and 6.5% in 2016, 2015 and 2014, respectively. The Journal of Commerce estimates that import volume will grow between 4.0% to 5.0% in 2017.
•: Demand for domestic intermodal container movements has increased steadily over the last decade. Over the last 10 years, the favorable economics of shipping 53' domestic containers in double-stack intermodal railroad service has generated consistent growth above the overall railroad freight growth average as shippers have transitioned from long-haul trucking to domestic double-stack railroad transport to reduce costs. U.S. domestic intermodal container volume has increased without interruption by a compound annual growth rate of 7.2% from 2001 to 2016. From 2011 to 2016, the U.S. domestic intermodal container volume increased by a compound annual growth rate of 7.1%. As a result, demand for our domestic chassis pool services has steadily increased during the same period. According to FTR Associates the US domestic intermodal container volumes grew 4.1% during 2016 and are expected to grow by a compound annual growth rate of 5.7% from 2016 to 2019. Over the last nine years, we have grown our domestic chassis pool fleet from 35,678 chassis in 2007 to 69,530 chassis as of December 31, 2016. In 2012, one of the world's largest providers of U.S. and international package delivery services entered the domestic intermodal market and became a customer of our domestic pool. We believe that this decision by one of the world's largest transportation companies to access domestic intermodal transportation is an example of the continuing growth in the domestic chassis pool business. Moreover, we expect this growth trend will further be supported by the railroads' ongoing investment in double-stack-capable railroad routes and new intermodal terminals.
•: Customer demand shifting from term lease to marine and domestic pool products. Over the last nine years, our customers have shown an increasing preference for chassis pool products relative to long-term leasing products. From 2006 to 2016, chassis in pools as a percentage of our on-hire fleet has increased from 29% to 84%, and our term lease and direct finance lease fleet has declined from 71% to 16% over the same period. See "—Industry overview" above. We believe that we are well equipped to take advantage of this trend towards increased usage of chassis pools due to the size of our fleet and market leading position coupled with our long-standing relationships with our customers.

Our Assets

Our fleet of equipment consists of marine and domestic chassis. These assets are owned, leased or managed by us on behalf of other third-party owners in pooling arrangements. As of December 31, ~~2015~~2016, we owned or managed a fleet of ~~311~~303,~~375~~246 chassis and units available for remanufacture. The average utilization for our chassis fleet for the past 20 years was 92.5%. Our utilization for the year ended December 31, ~~2015~~2016 was ~~94.5~~92%. The net book value of our owned equipment was approximately ~~$1.45 billion.~~ ~~Our active fleet had an average age of 13.3 years as of December 31, 2015. Chassis are long-lived assets, with an economic life of approximately 20 years for domestic chassis and 22.5 years~~

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$1.42 billion. Our active fleet had an average age of 13.5 years as of December 31, 2016. Chassis are long-lived assets, with an economic life of approximately 20 years for domestic chassis and 22.5 years for marine chassis. At the end of its economic life, a chassis can be remanufactured, which extends the economic life by an additional 20 or more years of service at a lower cash outlay than purchasing a new chassis while providing the same quality of service as a new chassis.

The table below summarizes the composition of our active fleet by the type of unit as of December 31, ~~2015~~2016:

	Units				Net book value
Total active fleet by equipment type	# of units		% of total		$ in millions		% of total		Average age (in years)
Marine chassis		~~197~~184,~~616~~307		7170	$	~~828~~815.24		6162		1415.90
Domestic chassis		80,~~477~~182		2930		~~535~~502.97		3938		89.76

Total active fleet		~~278~~264,~~093~~489		100	$	1,~~364~~318.1		100		13.35

The chassis in our fleet are owned outright by us (including, in certain instances, subject to sale leaseback agreements with our lenders), leased by us from third parties, or contributed by third parties into chassis pools and managed by us. The table below summarizes the composition of our fleet by ownership as of December 31, ~~2015~~2016:

Total chassis by ownership and equipment type
Owned	~~179~~173,~~340~~097	72,~~587~~141	~~251~~245,~~927~~238
Direct finance lease products	3,~~760~~430	34	3,~~794~~464

Total owned	~~183~~176,~~100~~527	72,~~621~~175	~~255~~248,~~721~~702
Leased-in/contributed	147,~~516~~780	78,~~856~~007	2215,~~372~~787

Total active fleet	~~197~~184,~~616~~307	80,~~477~~182	~~278~~264,~~093~~489

Product Offerings

We provide our customers with three principal product offerings: term lease products, direct finance lease products and short-term rental agreements. Term lease products and direct finance lease products are typically long term, triple net leases with fixed rate per diems which require the lessee to pay all maintenance fees, insurance premiums and tax payments related to the equipment. Short-term rental agreements are typically chassis pool products with rental based on actual usage of the chassis. In addition to leasing chassis, we offer management services for chassis pools, regardless of whether the chassis in the pools are owned by us. All chassis leased under term leases, direct finance leases or in pool arrangements are considered fully utilized since these chassis are not available for us to lease regardless of whether all of the units are generating income. As we grow our pools and allocate more available chassis to pools, such assets will also be considered fully utilized and, therefore, increase our utilization rate.

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The table below summarizes our total fleet by type of lease as of December 31, ~~2015~~2016:

	Units				Net book value of owned fleet
Total fleet by lease type	# of units		% of total		$ in millions		% of total		Average age (in years)		% of On-hire fleet
Term lease		4436,~~284~~505		1412	$	~~221~~186.19		1513		1314.71		1715
Direct finance lease		3,~~794~~464		1		1211.83		1		10.58		1
Marine chassis pool		~~147~~133,~~285~~494		4744		~~602~~590.45		42		14.9		5655
Domestic chassis pool		6769,~~407~~530		2223		~~463~~443.14		3231		89.2		2629

On-hire fleet		~~262~~242,~~770~~993		8480		1,~~299~~232.41		9087		13.12		100

Available fleet		1521,~~323~~496		57		6486.70		46		16.02

Active fleet		~~278~~264,~~093~~489		8987		1,~~364~~318.1		9493		13.35

Units available for remanufacture		3338,~~282~~757		1113		84101.76		67

Total fleet		~~311~~303,~~375~~246		100	$	1,~~448~~419.87		100

Term lease products

Under a term lease, the lessee commits to a fixed lease term, typically between 1 and 5 years. We retain the benefit and residual value, and bear the risk of re-leasing the asset upon expiration of the lease. Because of the operational difficulty in switching chassis providers, lessees frequently retain long-term leased equipment well beyond the initial lease term. In these cases, long-term leases will be renewed at the then prevailing market rate, for 1 to 5 years. Our term lease renewal rate for the year ~~ended~~ ended December 31, ~~2015~~2016 approximated 8368%. During ~~2015~~2016, several of our lessees have opted to continue renting chassis from us in our chassis pools upon the expiration of their term leases. If we include these rentals, the renewal rate for the year ended December 31, ~~2015~~2016 would be approximately 8776%.

Our term leases generally provide for monthly billing and generally require payment by the lessee within 30 days after presentation of an invoice. Term leases are typically long-term triple-net leases with fixed rate per diems, which require the lessee to maintain, insure and pay taxes on the equipment and pay all maintenance fees, insurance premiums and tax payments related to the equipment. Typically, the lessee is responsible for payment of all handling charges and other costs arising out of use of the equipment and must carry specified amounts of insurance to cover physical damage to and loss of equipment, as well as bodily injury and property damage to third parties. In addition, our leases usually require lessees to repair any damage to the chassis other than normal wear and tear. Lessees are also required to indemnify the owner of the equipment against losses arising from accidents and other occurrences involving the leased equipment.

Term leases can contain an early termination provision allowing the lessee to return equipment prior to the expiration of the lease upon payment of an early termination fee or a retroactively applied increase in lease payments. In addition, customers may bear substantial costs related to repositioning and repair upon return of the equipment. In the past, we have experienced minimal early returns of our equipment under our term leases, primarily because of the costs involved. However, due to several shipping lines adoption of the motor carrier model, we are experiencing higher than expected termination of term leases. These customers tend to enter into a marine pool arrangement.

As of December 31, ~~2015~~2016, we had 4436,~~284~~505 chassis amounting to a net book value of $~~221~~186.19 million under term leases.

Direct finance lease products

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and benefits of equipment ownership are passed on to the lessee. The lease payments are segregated into principal and interest components that are similar to a loan. The interest component, calculated using the effective interest method over the term of the lease, is recognized as Finance revenue. The principal component of the lease is reflected as a reduction to the net investment in the direct ~~Direct~~finance lease. The typical initial term on direct finance leases is between 3 and 10 years, often with multiple renewals to extend the lease ~~products~~ term by another 1 to 3 years.

Direct finance lease terms and conditions are similar to those of our term leases, except that, under a direct finance lease, the customer commits to a fixed lease term and typically receives a bargain purchase option at the expiration of the lease. Under this arrangement, the substantive risks and benefits of equipment ownership are passed on to the lessee. The lease payments are segregated into principal and interest components that are similar to a loan. The interest component, calculated using the effective interest method over the term of the lease, is recognized as Finance revenue. The principal component of the lease is reflected as a reduction to the net investment in the direct finance lease. The typical initial term on direct finance leases is between 5 and 10 years, often with multiple renewals to extend the lease term by another 1 to 3 years.

For direct finance leases, lease payments are typically calculated on a per diem basis, regardless of the term of the lease. These leases are long-term triple-net arrangements, requiring the lessee to maintain, insure and pay taxes on the equipment, at no cost to us. Our direct finance leases generally provide for monthly billing and require payment by the lessee within 30 days after presentation of an invoice. In addition, our leases usually require lessees to repair any damage to the chassis other than normal wear and tear. Lessees are also required to indemnify us against losses arising from accidents and other occurrences involving the leased equipment.

As of December 31, ~~2015~~2016, we had 3,~~794~~464 chassis under direct finance leases amounting to a net book value of $1211.83 million.

Chassis pools

We operate and maintain domestic and marine chassis pools. A chassis pool is similar to a car rental model in which we provide a shared pool of chassis at major intermodal transportation points, such as port terminals and railroad ramps for use by multiple customers on an as-needed basis. Additionally, we are a contributor to ~~cooperative~~ cooperative marine pools. In a cooperative ("co-op") pool model, several chassis owners contribute chassis into a single pool for users. Contributors must contribute a number of chassis proportionate to that of their customer usage. An authorized user of the pool may use any chassis in that pool regardless of the owner/contributor of the chassis. Costs of the pool are charged back to the contributors in one of several allocation ~~basis~~bases, either by total number of chassis contributed or by number of chassis actually used. Customers generally enter into pool user agreements for a period of 1 to 3 5 years and may be subject to subscription levels for minimum chassis usage. As of December 31, ~~2015~~2016, 2321% of chassis pool revenue was generated by such minimum usage arrangements. Additionally, multi-year agreements typically contain annual pricing reset features.

In chassis pools that TRAC operates, we are entirely responsible for the logistics and maintenance of the assets. TRAC also participates in pools not managed by TRAC. Regardless of our role in pool management, we may allow our users to contribute their own assets to the pool. In this case, the customers' chassis become part of the pool operations, but are not owned by us. We believe this practice has long-term benefits for us, as our customers tend to become fully reliant on the chassis pool to serve their operational requirements. In addition, accepting our customers' chassis into our marine pools will facilitate the exit of shipping lines from the chassis business in favor of the motor carrier model because the shipping lines will have effectively outsourced the management of their chassis thus reducing overall operating expenses.

For the year ended December 31, ~~2015~~2016, ~~91.8~~92% of Equipment leasing revenue was generated from chassis pools. Unlike term and direct finance leases, we are responsible for managing ~~the~~ the utilization of the assets in pools, and we have partially mitigated this risk through subscription arrangements for minimum chassis usage. Furthermore, we believe that once customers switch from operating their own chassis to relying on our chassis pools, it is operationally difficult to discontinue using the chassis in our pools because the customers would need to rebuild their logistic capabilities and chassis management functions.

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~~pools~~Illinois, ~~because~~California, Washington, Florida, and Texas. Additionally, we plan to open two additional service centers in 2017, bringing the ~~customers~~total ~~would~~number ~~need~~of service centers to ~~rebuild~~nine. ~~their~~However, ~~logistic~~the ~~capabilities~~majority of our maintenance and ~~chassis~~repair ~~management~~work ~~functions~~is still contracted to third-party vendors. As a result, we periodically conduct pre- and post-repair audits to ensure the work was done completely and to our quality specifications. We also employ field staff throughout the United States for physical oversight of maintenance and repair work at the place of occurrence and employ a system-based audit of invoices utilizing PoolStat®, whereby invoices are received directly into the system. See "Management's discussion and analysis of financial condition and results of operations—Our business—Other revenue."

The key factors for operating profitable chassis pools are high utilization, operating cost control and compensatory rates. Our experienced management and proprietary systems help us operate our chassis pools at targeted utilization levels. The maintenance and repair of chassis is the predominant operating cost in a chassis pool. Customers pay higher per diem rates for our pool products compared to term lease and direct finance lease products, which partially offsets higher operating costs and lower utilization rates. During 2013 and 2014, we opened three additional service centers to add to our Woodbridge, New Jersey facility which was already in operation. These additional service centers are located in Chicago, Illinois; Los Angeles, California; and Seattle, Washington. Moreover, during 2015, we have signed leases for three more service centers located in Jacksonville, Florida; Houston, Texas and Oakland, California. These service centers will be operational in the first quarter of 2016. Additionally, we plan to open another service center in the second quarter of 2016, bringing the total number of service centers to eight. However, the majority of our maintenance and repair work is still contracted to third-party vendors. As a result, we periodically conduct pre- and post-repair audits to ensure the work was done completely and to our quality specifications. We also employ field staff throughout the United States for physical oversight of maintenance and repair work at the place of occurrence and employ a system-based audit of invoices utilizing PoolStat®, whereby invoices are received directly into the system. See "Management's discussion and analysis of financial condition and results of operations—Our business—Other revenue."

Marine chassis pools

We operate pools and contribute chassis in many of the major port terminals and railroad ramps on the Eastern seaboard, Gulf Coast, Midwest, Pacific Northwest and Pacific Southwest, using marine 20', 40' and 45' chassis. As of December 31, ~~2015~~2016, we owned ~~133~~125,~~077~~762 chassis and managed 147,~~208~~732 chassis owned and contributed by ~~shipping~~ shipping lines for a total of ~~147~~133,~~285~~494 chassis engaged in providing this service. The net book value of our owned marine pool chassis amounted to $~~602~~590.45 million as of December 31, ~~2015~~2016. ~~Marine~~ Marine chassis pool customers pay per diem rates and in some cases are subject to subscription levels for minimum chassis usage that are typically 1 year in length. For the year ended December 31, ~~2015~~2016, approximately 2% of marine chassis pool revenue was generated under subscription arrangements~~, down from 4% in 2014 due to the mix of revenue~~.

Domestic chassis pools

We also operate pools for domestic 53' chassis at railroad ramps throughout the United States. As of December 31, ~~2015~~2016, we had ~~67,407~~ 69,530 chassis, including 7,~~845~~995 chassis that we lease-in, engaged in providing this service. The net book value of the domestic pool chassis that we own totaled $~~463~~443.14 million, as of December 31, ~~2015~~2016. In 2015, we had exclusive arrangements with five of the seven Class I railroads that carry freight in the United States to provide this service at many of their railroad ramps. However, welater ~~have~~that ~~been~~same year, we were advised by one of the Class I railroads that they ~~intend~~would tonot ~~terminate~~renew ~~the~~their contract on an exclusive ~~nature~~basis when the agreement terminated in 2016. In the fourth quarter of ~~their~~2016, we signed a non-exclusive agreement with usthis atrailroad. ~~some~~Additionally ~~point~~ in 2016, we were advised by two more Class I railroads with whom we had exclusive arrangements that they did not wish to renew on an exclusive basis. We have already signed a new non-exclusive contract with one of these two railroads and while we are ~~currently~~ in the early stages of negotiations with ~~this~~the ~~Class 1~~second railroad, ~~about~~we anexpect ~~alternative~~to ultimately sign a non-exclusive ~~agreement~~renewal contract with usthem as well. With regard to the leasing of these domestic chassis, we have long-term contracts with many of the largest intermodal logistics companies and railroads that operate standard-size domestic intermodal equipment. Large portions of our domestic chassis are leased under these contracts and under similar contracts with other customers and in some cases are subject to subscription levels for minimum chassis usage that are typically three to five years in length. For the year ~~ended~~ ended December 31, ~~2015~~2016, approximately 5047% of domestic chassis pool revenue was generated under subscription arrangements, down from 6150% in ~~2014~~2015. However, during 2016, one of our ten largest customers has decided to buy chassis and, as a ~~large~~result, ~~logistics~~is expected to no longer be a substantial customer ~~now~~of ~~pays~~ours ~~for~~by ~~chassis~~the ~~as they~~end ~~are~~of ~~used~~2017.

Other revenue

The vast majority of our revenues are generated from the three product offerings described above. However, we also generate certain other revenues, including service revenues earned from maintenance and repair fees charged to our lessees, repositioning fees charged to our pool customers, other fees related to the management of chassis pools and emergency roadside repair revenue resulting from the Interstar Acquisition (as defined below). For the year ended December 31, 2016, we generated total other revenues of $43.1 million.

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On February 29, 2016, TRAC Interstar LLC ("TRAC Interstar"), a newly formed, indirect wholly-owned subsidiary of the Company, acquired certain assets and assumed certain liabilities of the emergency road service business of Interstar Mobile, LLC and Interstar North America, Inc. (collectively "Interstar," and such acquisition and assumption, the "Interstar Acquisition"). Interstar, located in Kentucky, is a leading provider of road service repair solutions for both the intermodal and commercial trucking industries. The new entity, TRAC Interstar, combines a dispatch center and one of the country's largest managed vendor networks and provides roadside repair services covering chassis, truck and trailer breakdowns 24 hours a ~~Other~~day, ~~revenue~~ 7 days a week, 365 days a year. See Note 1 "Description of the Business and Basis of Presentation" to our Consolidated Financial Statements.

The vast majority of our revenues are generated from the three product offerings described above. However, we also generate certain other revenues, including service revenues earned from maintenance and repair fees charged to our lessees, repositioning fees charged to our pool customers, and other fees related to the management of chassis pools. For the year ended December 31, 2015, we generated total other revenues of $28.6 million.

Operations

Equipment tracking and billing

Over the last decade, we have internally developed a proprietary chassis management software technology called PoolStat®. We We primarily use PoolStat® for chassis tracking and billing in our pools, as well as to provide a central operating database that coordinates our chassis leasing activities. The system electronically records the movement and status of each chassis and links that information with data comprising the specific lease terms in order to accurately bill our customers. This system also generates a wide range of management reports containing information on all aspects of our chassis leasing activities. In 2014, we made the decision to implement an ERP solution along with a customized solution for many functional improvements to ~~Poolstat~~PoolStat®. As of December 31, ~~2015~~2016, the project will likely span 12-15 months and will be designed to implement the ~~aforementioned~~ aforementioned improvements and eliminate inefficiencies in our financial and operational systems as they exist today. We estimate the incremental costs of the project to be $2030 million to $2434 million and will be managed and governed by the executive management of the Company.

Inventory, depot storage and service centers

We have a broad operating footprint with approximately ~~600~~580 marine, ~~160~~170 domestic and 60 depot locations across North America. We maintain an inventory of chassis and axles at these depots. The chassis inventory is used as a key element in balancing the peaks and valleys in demand for chassis in our marine and domestic pool operations and supports our chassis remanufacturing process. When demand in a pool starts to rise and puts pressure on the pool supply, units are moved from the depot to the pool operation to ensure our customers do not experience a service problem. Conversely, when demand slows and the pool has more units than are needed, chassis are moved back into the depots for storage and maintenance. This back and forth flow of chassis inventory between our depots and chassis pools is a key part of pool efficiency and a requirement of port terminals and railroad ramps where we operate our pools. This feature distinguishes our pools from the Co-ops pools, which we believe require collective decision-making by chassis contributors thereby slowing the ability to right-size the pool. The majority of our depots are strategically located in close proximity to our marine and domestic pool operations to facilitate the regular flow of equipment back and forth between these operations. Certain depots are also used as "start/stop" locations in which motor carriers can pick up a chassis through our TRAC Connect program. At our depot facilities, we also perform maintenance and repair work on chassis that are being placed on term lease with our customers. Typically one depot will service the needs of multiple pool operations to ensure operational efficiency. Axles are stored at depots and service centers and are moved to remanufacturing facilities on an as-needed basis.

~~During~~At ~~2013~~December 31, ~~and 2014~~2016, we ~~opened~~are ~~three~~operating ~~additional~~seven service centers tolocated ~~add~~in ~~to our Woodbridge,~~ New Jersey ~~facility which was already in operation. These additional service centers are located in Chicago~~, Illinois~~; Los Angeles~~, California~~; and Seattle~~, Washington., ~~Moreover~~Florida, ~~during~~and ~~2015~~Texas. Additionally, we ~~have~~plan ~~signed~~to ~~leases~~open ~~for~~two additional ~~three more~~ service centers ~~located~~ in ~~Jacksonville~~2017, ~~Florida;~~bringing ~~Houston, Texas~~the ~~and~~total ~~Oakland,~~number ~~California.~~of ~~These~~ service centers ~~will~~to benine. ~~operational~~We inanticipate ~~the~~that ~~first~~service ~~quarter~~centers ofwill ~~2016.~~allow ~~Additionally~~us to, weamong ~~plan~~other tothings, ~~open~~store ~~another~~our ~~service~~chassis ~~center~~and inaxles ~~the~~on property ~~second~~that ~~quarter~~we ~~of 2016~~lease, ~~bringing~~which ~~the total~~we ~~number~~believe ofwill ~~service~~give ~~centers~~us tobetter ~~eight.~~control Weover ~~anticipate~~certain ~~that~~of ~~service~~our ~~centers~~assets ~~will~~and ultimately allow us to, ~~among~~save ~~other~~on ~~things,~~the ~~store~~storage ~~our~~fees

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~~chassis and axles on property that~~ we ~~lease, which we believe will give us better control over certain of our assets and ultimately allow us to save on the storage fees we~~ currently pay to third parties. We will also use these locations to perform maintenance and repair on our chassis instead of paying third parties to perform such maintenance and repair services. We believe that performing such maintenance and repair services ourselves will also result in cost savings.

Maintenance and repair

The maintenance and repair of chassis is the predominant operating cost in a chassis pool. Although our term and direct finance leases require the lessees to pay for the chassis' maintenance and repair while they are on lease to them, we remain responsible for the cost of repairing ordinary wear and tear when the chassis under term leases are returned to us. In addition, we are responsible for the systematic inspection, repair and maintenance of the chassis in pools that we manage. The vast majority of our maintenance and repair work is still contracted to third-party vendors. As a result, we also periodically conduct pre- and post-repair audits to ensure the work was done completely and to our quality specifications. We employ field staff throughout the United States who provide physical oversight of certain maintenance and repair work. We utilize proprietary handheld computers that record chassis condition and authorize work to be done on an individual unit. These computer captured assessments are then compared to electronic invoices as part of our control process. Our inventory of available chassis ready to be leased or placed in a pool are stored at depots whose primary purpose is the storage and maintenance and repair of intermodal equipment. We have significant relationships with third-party depots throughout the country.

Remanufacturing/Refurbishment

Chassis are long-lived assets, with an economic life of 20 and 22.5 years for domestic and marine chassis, respectively. Older ~~chassis~~ chassis can generally be remanufactured at the end of their useful life to provide 20 and 22.5 additional years of service rather than be replaced by new equipment. Remanufacturing provides a material ~~cash~~ cash savings compared to the cost of purchasing a new chassis. The remanufacturing process can bring an aged chassis up to a "like new" condition, and customers typically do not differentiate between ~~new~~ new and remanufactured chassis. A second cost savings benefit of remanufacturing is being able to reuse the tires and wheels from the old units in our tire recap program. Tires are the largest single ~~cost~~ cost in chassis maintenance and repair and we lower that cost by reusing and recapping our tires. Also, at times, tire casings are difficult to obtain on the open market. Creating an organic source of ~~tire~~ tire casings through our remanufacturing process lowers our overall maintenance and repair costs. In addition to the cost savings, an additional benefit is that an older chassis can be remanufactured ~~into~~ into any size unit, which provides excellent flexibility to meet demands of different equipment types as the market changes. During ~~2015~~2016, we remanufactured ~~2,801~~99 ~~and 1,966~~ end-of-life chassis into an equivalent number of 53' domestic chassis. ~~and~~We also remanufactured 459 end-of-life chassis into 434 40' marine chassis, ~~respectively~~and 25 20' marine chassis. During ~~2014~~2015, we remanufactured 42,~~800~~801 and ~~250~~1,966 end-of-life chassis into an equivalent number of 53' domestic chassis and 40' marine chassis, respectively.

Alternatively, chassis meeting certain age and condition criteria can be refurbished. Refurbishments reflect improvements that go beyond preventive maintenance and normal repairs, thus serving to increase the cash flow generating capability of the refurbished asset. Cash flows are enhanced through extending the useful life of the asset or otherwise altering its structural state to be more marketable. Refurbishment costs are capitalized and depreciated over the remaining / extended useful life of the equipment. For the years ended December 31, ~~2015~~2016 and ~~2014~~2015, we refurbished 23,~~122~~151 and ~~549~~2,122 chassis, respectively.

Sales and marketing

We have an experienced and dedicated team of Sales and Marketing professionals. We believe this deep knowledge base, combined with strong customer relationships, enables us to more effectively assist

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our ~~Sales~~customers with their changing chassis requirements. Recently we have added centralized Customer Service and ~~marketing~~ Product development functions to focus on growth opportunities. See "—Business strategy." These functional additions are outstanding complements to our long-tenured management team.

We have an experienced and dedicated team of Sales and Marketing professionals. We believe this deep knowledge base, combined with strong customer relationships, enables us to more effectively assist our customers with their changing chassis requirements. Recently we have added centralized Customer Service and Product development functions to focus on the growth opportunities. See "—Business strategy." These functional additions are outstanding complements to our long-tenured management team.

Our customers

Our customer base includes more than 43,~~100~~950 companies and is comprised of some of the leading shipping lines, Class I railroads U.S. intermodal transportation companies and motor carriers. Our customer base is diversified with our 10 largest customers accounting for 4138% of our total revenue in ~~2015~~2016, with the single largest ~~customer~~ customer accounting for less than 78%. In the marine market, we have an extensive history with our shipping line customers, in many cases spanning over 30 years, with strong relationships at ~~senior~~ senior levels of management. Over the past several years, many of our shipping line customers have decided to transition from providing or managing chassis as part of their ongoing operations. As a result of the transition to what is called "the motor carrier model", as of December 31, ~~2015~~2016, we had over 4,~~900~~617 motor carriers in varying stages of registration in our TRAC Connect program, which is designed as the interface with our motor carrier customers. In ~~the domestic market~~2015, we ~~have~~had exclusive arrangements with five of the seven ~~major~~ Class I railroads that carry freight in the ~~U.S.,~~United ~~and~~States ~~long-term~~to ~~chassis~~provide this ~~pool~~service ~~supply~~at ~~arrangements with~~ many of ~~the~~their ~~largest~~railroad ~~intermodal logistics companies~~ramps. However, welater ~~have~~that ~~been~~same year, we were advised by one of the Class I railroads that they ~~intend~~would not renew their contract on an exclusive basis when tothe ~~terminate~~agreement terminated in 2016. In the ~~exclusive~~fourth ~~nature~~quarter of ~~their~~2016, we signed a non-exclusive agreement with usthis atrailroad. ~~some~~Additionally ~~point~~ in 2016, we were advised by two more Class I railroads with whom we had exclusive arrangements that they did not wish to renew on an exclusive basis. We ~~are~~have ~~currently~~already signed a new non-exclusive contract with one of these two railroads and while we are in the early stages of negotiations with ~~this~~the ~~Class 1~~second railroad, ~~about~~we anexpect ~~alternative~~to ultimately sign a non-exclusive ~~agreement~~renewal contract with us them as well. In 2012, one of the world's largest providers of U.S. and international package delivery services entered the domestic intermodal market and became a customer of our domestic pool. We believe that this decision by one of the world's largest transportation companies to access domestic intermodal transportation provides meaningful support for continued growth in the future. We ~~have~~are ~~also~~continuing ~~begun~~ to focus on penetrating a new customer base, the ~~beneficial cargo owner ("~~BCO's"). BCO's are the importers of record that takes physical possession of the goods at the destination. Large retail outlets are often BCO's. In the motor carrier model, the shipping line may no longer be responsible for chassis provisioning and certain BCO's will want to assume responsibility for that procurement. TRAC believes that the BCO customer base represents significant growth opportunities and will pursue them as appropriate.

Competition

In the last thirteen years there has been a consolidation in the chassis leasing business, reducing four major players to three: TRAC Intermodal, FLEXI-VAN and DCLI. We believe we are the largest intermodal chassis solutions provider, measured by total assets, for domestic and international transportation companies in North America. We have an estimated market share of 5049% among the top three chassis leasing providers as of December 31, ~~2015~~2016. Our closest competitor has a market share of approximately 2728% according to our estimates. We believe that our significant size and broad footprint give us a competitive advantage by being able to address our customers' comprehensive chassis demand across the United States. The size of our fleet, with a replacement value of $3.43 billion, and scope of our operations, also allow us to satisfy our customers' chassis demand during peak seasons or surge periods and creates a significant barrier to entry. Nonetheless, the chassis leasing industry remains highly competitive, with competition based principally on pricing, product quality and availability, lease flexibility and customer service.

In addition, sometimes chassis fleets are shared between member contributors that have the responsibility to manage or delegate the management of the operation as part of Co-op pools. The

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~~In addition, sometimes chassis fleets are shared between member contributors that have the responsibility to manage or delegate the management of the operation as part of Co-op pools. The~~ largest example of such a third-party Co-op pool in the United States is Consolidated Chassis Management ("CCM"), which controls approximately ~~140~~130,000 chassis in Co-op pools across the United States. Another example of such a third-party Co-op is the NACPC, a limited liability company comprised of eleven motor carrier members that combined, currently own or lease on long term basis an estimated 818,~~500~~000 chassis.

While we believe we have only two significant leasing competitors, we also compete with other domestic leasing companies, intermodal shipping companies (including a logistics company that maintains a proprietary fleet of approximately 7974,000 nonstandard specification domestic chassis), banks offering finance leases and promoters of equipment ownership and leasing as an investment as well as with non-intermodal shipping companies, such as motor carriers that provide for the transportation of goods without the use of chassis.

Our chassis suppliers

Today there are four active manufacturers and remanufacturers of chassis, three in North America (including one in Mexico) and one in China, and we have enjoyed long-standing relationships with all of them. A newly manufactured domestic chassis typically cost between $11,000 and $14,000, depending upon specifications and volume discounts; and the price difference between a newly manufactured chassis and a remanufactured chassis is approximately 25%. We primarily utilize the remanufacturing process to recycle our older units, primarily axle sets, and realize the lower cost to generate new units. We do not anticipate that TRAC will order any new chassis in the foreseeable future, although we have refurbished or remanufactured both marine and domestic chassis in ~~2015~~2016. In the domestic chassis market, which has no chassis supply surplus, we do anticipate a steady volume of remanufacturing over the next several years as demand ~~increases~~ increases for domestic chassis. Remanufacturing requires expertise in procurement and logistics as well as the availability of the component parts (axles) required to build the remanufactured unit. We ~~believe~~ believe that most of our customers do not possess either the expertise or component parts to remanufacture chassis which gives us an advantage in the market.

Information technology

Over the last decade, we have internally developed a proprietary chassis management software technology called PoolStat®. We developed PoolStat® and maintain full control of the system through our in-house development team. Our experienced IT staff, working closely with our chassis pool management team and our customers, engages in continuous improvement to the system, which possesses the necessary sophistication to operate complex chassis pool functions of demand/supply, inventory control, status, repositioning, billing, and maintenance and repair. We also license other software applications to support our financial functions. We use third-party software for our general ledger, receivables, payables and payroll systems. We also have developed an in-house fixed asset system that allows us to maintain complex attributes that match our equipment to our titling system and our financing facilities and will also track our lease types. In addition, in connection with the transition to the motor carrier model, we have developed the TRAC Connect program, which is designed as the interface with our motor carrier customers.

In 2014, we made a decision to implement an ERP solution along with a customized solution for many functional improvements to PoolStat®. As of December 31, ~~2015~~2016, the project will likely span 12-15 months and will be designed to implement the aforementioned improvements and eliminate inefficiencies in our financial and operational systems as they exist today. We estimate the incremental costs of the project to be $2030 million to $2434 million and will be managed and governed by the executive management of the Company.

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Seasonality

Our business experiences seasonal revenue trends that correlate directly to increases in the importation of goods via intermodal containers and domestic container traffic linked to the movement of goods in anticipation of the year-end holiday season. The "peak" season generally begins in the early third quarter and then begins to slow in the late third quarter and early part of the fourth quarter. This is when our revenues are generally the highest. ~~Although~~However in ~~2015~~2016, weour ~~experienced~~marine apool ~~"flattened"~~volumes ~~peak~~were ~~with~~generally ~~volumes~~unchanged ~~falling~~in our second and third ~~off~~quarters ~~more~~and ~~sharply~~slightly declined in the fourth quarter. ~~than~~Our domestic pool usage grew moderately in ~~prior~~each ~~years~~quarter of 2016. Our operating expenses will move in tandem with the increased volume of container traffic and are also impacted by the warmer weather during the summer months in the mid-western, southern and eastern parts of the United States. We generally experience higher volumes of tire replacement costs during these months. No other significant seasonal trends currently exist in our business.

Geography

Primarily all of the Company's revenues and long-lived assets are attributable to the United States, the Company's country of domicile.

Insurance

Lessees and depots generally must either carry physical damage and liability insurance, providing primary insurance coverage for loss and damage to the chassis, cargo and third parties while the chassis are in their care, custody and control or provide proof of creditworthiness to self-insure. Moreover, our vendors must similarly carry liability insurance providing primary insurance coverage for loss and damage to the chassis, cargo and third parties while the chassis are in their care, custody and control. In addition, we maintain physical damage and liability coverage, including contingent liability coverage for any claims or losses, including while the chassis are on-hire to a lessee or otherwise in the possession of a third-party.

The insurance guidelines for lessees are explicitly stated in each of our lease contracts and we require certificates evidencing lessees' insurance prior to delivery of chassis. In most of our lease agreements, lessees must carry insurance that meets the following minimum requirements:

•: All Risks Physical Damage Insurance in an amount equal to 100% of the replacement value of all leased equipment while on land, afloat, in transit or at rest anywhere in the world.
•: Comprehensive General Liability Insurance, including contractual liability against claims for bodily injury or death and property damage, in an amount not less than $2 million combined single limit for shipping lines and $1 million for motor carriers.
•: Automobile Liability and Property Damage insurance in an amount not less than $2 million combined single limit for shipping lines and $1 million for motor carriers.

The insurance companies from which our lessees purchase these policies must be acceptable to us. To the extent any claim is not recovered by the policy, the lessee remains liable for the full amount of the claim.

Credit risk

We have a strong collection history with both top-tier firms and smaller market players throughout economic cycles, which we believe speaks to the essential nature of the chassis in the supply chain. Our credit and collection team consists of highly tenured and experienced staff with strong industry relationships. We maintain ~~detailed~~ detailed customer credit records, and we periodically evaluate maximum exposure limits for each customer. The credit criteria we consider include, but are not limited to, the ~~customer's financial strength, trade route, countries of operation, net worth, asset ownership, bank and~~

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~~trade~~customer's financial strength, trade route, countries of operation, net worth, asset ownership, bank and trade credit references, credit bureau reports, operational history and payment history with us. We have experienced a minimal default rate—only 1213 term lease customers during the period ~~2009~~ 2011-~~2014~~2016—and we were successful in recovering 98% of our chassis under default. For the year ended December 31, ~~2015~~2016, term lease defaults were minimal.

During the period 2012-~~2015~~2016, we had total aggregate revenue of approximately $2.29 billion with bad debt amounting to 1.3% of revenue. During the period 2009-2011, prior to the shift in billing from the shipping lines to the motor carriers, our bad debts averaged 0.5% of $0.9 billion in aggregate revenues. Under the motor carrier model, the motor carrier and not the shipping line is in many cases the party responsible to pay for the use of our chassis. Typically, motor carrier companies are much smaller than shipping line companies and as a result are often a greater credit risk. Although the per diem rates we charge motor carriers are priced to take account of this increased credit risk, defaults by our customers may increase as we continue to transition to the motor carrier model. See "Risk factors—WeThe ~~intend~~ongoing totransition ~~grow~~of ~~our business by enabling our~~ shipping ~~line~~lines ~~customers~~ to ~~transition~~ to the motor carrier model, ~~which~~ may subject us to business and financial risk."

Regulatory environment

As a chassis provider in the United States, we are considered to be the Intermodal Equipment Provider ("IEP") for our chassis in our chassis pools and for those managed chassis where we contractually agree to act as the IEP. As an IEP, we are subject to certain rules and regulations. Specifically, the regulations issued by the Federal Motor Carrier Safety Administration (the "FMCSA") of the U.S. Department of Transportation ("USDOT") which govern entities offering intermodal chassis to motor carriers for transportation of intermodal containers in interstate commerce. We refer to these regulations, collectively, as the "Roadability Regulations." Such regulations are designed to improve the safety of commercial motor vehicles and truck drivers and require each IEP to register and file certain reports with the FMCSA, display a USDOT number on each chassis offered for interstate commerce or maintain that number in a national equipment database, establish a systematic chassis inspection, repair and maintenance program, maintain documentation with regard to this program and provide means for drivers and motor carriers to report on chassis deficiencies and defects. The Roadability Regulations began with partial compliance requirements in mid-2010 and have been fully implemented since December 17, 2010. As the FMCSA becomes more familiar with container chassis and builds its field and administrative organization, it is possible that the number of roadside inspections and / or the criteria for roadside inspections may be adjusted. The Roadability Regulations establish fines and other sanctions for an IEP whose chassis fail to comply with the applicable federal safety criteria.

In addition, we are subject to laws and regulations, such as the Fair Labor Standards Act, which governs such matters as minimum wage, overtime and other working conditions, which may increase our labor costs and may subject us to fines, penalties and liabilities to our employees.

Employees

As of December 31, ~~2015~~2016, we employed approximately ~~660~~700 people, across our operations in North America. We believe that our relations with our employees are very good and employee engagement is high. We are not a party to any collective bargaining agreements.

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ITEM 1A. RISK FACTORS

The following discussion sets forth some of the most important risk factors that could materially affect our financial condition and operations. However, factors besides those discussed below, in MD&A or elsewhere in this or other reports that the Company has filed or furnished with the SEC, also could adversely affect us. Readers should not consider any descriptions of such factors to be a complete set of all potential risks that could affect the Company.

The demand for leased chassis depends on many economic, political and other factors beyond our control and a decrease in the volume of world trade and other factors may adversely affect our business.

Demand for leasing our chassis depends largely on the extent of world trade and economic growth, with U.S. consumer demand being the ~~most~~ most critical factor affecting such growth. A failure of the U.S. to continue its economic recovery, further delays in economic recovery or a further deterioration of economic conditions in the U.S. ~~and~~ and the European Union would result in a reduction in world trade volume and in demand by shipping lines, railroads and motor carriers for leased equipment. Political changes and uncertainty surrounding policies and regulations related to the new U.S. presidential administration with respect to trade, tax, or otherwise, could negatively impact economic conditions in the global economy, U.S. markets, our customers' businesses and otherwise. The impact of the United Kingdom's referendum on June 23, 2016 in which a majority of voters approved an exit from the European Union, commonly referred to as "Brexit," may likewise result in the deterioration of economic conditions and increased market volatility, currency exchange fluctuations and global instability which may adversely affect our business and profitability. Emerging markets, particularly China, have experienced an economic slowdown, which may further result in reduced exports and therefore lower demand for leasing our chassis. Such downturns or recessions can negatively affect our operating results because during economic downturns or periods of reduced trade, shipping lines, railroads and motor carriers tend to lease chassis only at reduced rates or lease fewer chassis because, for example, they shift away from intermodal transport toward other forms of transportation for their goods. Thus, if the volume of world trade does not continue to recover or decreases or if the economy of the United States, the European Union or other consumer oriented countries does not continue to recover or slows down, this would adversely affect our utilization rates and per diem rates, which, in turn, would lead to reduced revenue, reduced capital investment, increased operating expenses (such as storage and repositioning) and reduced financial performance. A decline in world trade (including a decrease in exports from China) or a slow-down in the economy of the United States, the European Union or other consumer oriented countries may also adversely affect our customers, which could lead to defaults by our customers and the early termination of their leases. We cannot predict whether, or when, such downturns will occur.

Other general factors affecting demand, utilization rates and per diem rates for leased chassis include the following:

•: prices of new, remanufactured and used chassis;
•: the availability and terms of equipment leasing and financing for chassis;
•: fluctuations in interest rates and foreign currency values, each of which can affect global consumer demand;
•: global and regional economic conditions and competitive pressures in the shipping, railroad and motor carrier industries;
•: the globalization of manufacturing;
•: changes in the operating efficiency of our customers;

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•: congestion at port or rail terminals that disrupts the shipment of containers that are transported on our chassis;
•: supply and demand for products shipped in containers that are then transported on our chassis;
•: fuel costs and their impact on overall transportation costs;
•: developments in international trade and shifting trends and patterns of cargo and motor carrier traffic;
•: the price of steel, petroleum, rubber and other raw materials;
•: changes in the relative demand for pool products compared to term and direct finance lease products;
•: flu or other pandemics that result in economic disruptions;
•: acts of God, such as droughts, storms or extreme weather patterns that result in the loss of chassis or transportation disruptions;
•: over capacity or under capacity of chassis, ship, railroad and other equipment manufacturers;
•: the lead times required to purchase chassis;
•: the number of chassis purchased by competitors;
•: the number of chassis purchased by potential lessees;
•: increased repositioning by shipping lines, railroads or motor carriers of their own empty chassis to higher demand locations in lieu of leasing equipment from us;
•: consolidation or withdrawal of individual lessees in the U.S. intermodal industry;
•: the continued conversion of over-the-road freight to rail;
•: changes in the relative number of chassis leased by motor carriers compared to shipping lines;
•: the cost of parts and labor needed to maintain and repair chassis;
•: import/export tariffs, duties and restrictions;
•: lease accounting changes resulting in an increase in chassis purchasing rather than leasing;
•: customs procedures and foreign exchange controls;
•: global and regional economic and political conditions, terrorism or uprisings against existing governments; and
•: environmental and other regulatory changes affecting the operation of chassis.

We cannot control these factors, any one of which may have a material adverse effect on our business and results of operations. These factors vary over time, and often do so quickly and unpredictably. Many of these factors also influence the decision by current and potential customers to lease our chassis or shift away from intermodal transport toward other forms of transportation for their goods. Should one or more of these factors influence current and potential customers to buy a larger percentage of the chassis or shift away from intermodal transport, our utilization rate would decrease, resulting in decreased revenue, increased storage and repositioning costs, and as a result, lower operating cash flow. See "—Potential and existing customers may decide to buy rather than lease chassis."

Our operating costs may materially and negatively impact our business.

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~~due~~ ~~to changes in labor practices (such as mandatory roadability inspections by union labor at certain terminals). See "—Our business may be adversely affected if~~ ~~we are forced to pay fees and other charges related to services performed at the host locations at which we operate our chassis pools". We may also experience increased costs~~ ~~due to our obligation to comply with the laws, rules and regulations governing the operating condition of our chassis, including those of the U.S. Department of Transportation's ("USDOT") Federal~~ ~~Motor~~ Our ~~Carrier Safety Administration ("FMCSA"). In addition, our ability to limit our~~ operating costs ~~depends~~may onmaterially ~~our effective management of the performance of our maintenance~~ and ~~repair~~negatively ~~vendors.~~impact ~~If we are unable to effectively manage such vendors, or pass any maintenance and repair cost increases along to~~ our ~~customers, our~~ business ~~could be negatively impacted~~.

We incur significant costs in operating our business, including the cost of maintaining and repairing our chassis. Although our term and direct finance lease products generally require the lessees to pay for the chassis' maintenance and repair while they are on lease to them, we remain responsible for the cost of repairing ordinary wear and tear items when the chassis under term leases are returned to us. In addition, we are responsible for the systematic inspection, repair and maintenance of the chassis in our chassis pool fleet. For the twelve months ended December 31, 2016, maintenance and repair costs accounted for 73.0% of our total operating expenses. As the number of chassis in our chassis pools increases and our fleet ages, we may experience an increase in maintenance and repair costs. These costs may also increase due to increases in labor rates and in the cost of parts and materials as well as due to changes in labor practices (such as mandatory roadability inspections by union labor at certain terminals). See "—Our business may be adversely affected if we are forced to pay fees and other charges related to services performed at the host locations at which we operate our chassis pools". We may also experience increased costs due to our obligation to comply with the laws, rules and regulations governing the operating condition of our chassis, including those of the FMCSA. In addition, our ability to limit our operating costs depends on our effective management of the performance of our maintenance and repair vendors. If we are unable to effectively manage such vendors, or pass any maintenance and repair cost increases along to our customers, our business could be negatively impacted.

Our business may be adversely affected if we are forced to pay fees and other charges related to services performed at the host locations at which we operate our chassis pools.

We are often responsible for the systematic inspection, repair and maintenance of the chassis in our chassis pool fleet. As the number of of chassis in our chassis pools increases and our fleet ages, we may experience an increase in inspection, maintenance and repair costs. These costs may also increase if additional requirements to pay fees and costs related to inspections, repair and maintenance are imposed on us. AAn ~~recent~~ agreement reached in 2015 between the Pacific Maritime Association ("PMA") and the International Longshore and Warehouse Union ("ILWU") provides for mandatory roadability inspections (subject to limited exceptions) of all chassis before they leave any of the West Coast terminals where the ILWU has jurisdiction (the "ILWU Roadability Program"). WeSince such agreement became effective, we have ~~recently~~been ~~received~~receiving invoices and payment demands from some host locations related to the ILWU Roadability Program. As of December 31, 2016, we have received invoices aggregating approximately $5.5 million. Such host locations have asked us to pay an inspection fee for each chassis that leaves such location.

We are currently disputing such fees because, among other reasons, we believe there is no legal basis for them to be imposed and the ILWU Roadability Program provides for inspections beyond those required by applicable law. Since we believe that any amounts we may be required to pay are not probable, we are not currently accruing any expenses for these fees. However, if we are unsuccessful in challenging these fees, the fees we may be required to pay may be material. Moreover, if we are unsuccessful in challenging these fees and we are unable to pass them on to our customers or we lose access to certain host locations because of our refusal to pay them, our business and results of operations could be negatively impacted.

Defaults by our customers could adversely affect our business by decreasing our revenues and increasing our storage, collection and recovery expenses, and require us to repay our lenders sooner than anticipated.

We generate revenues primarily from lease payments by our customers for our chassis. Inherent in the nature of the leases and other ~~rental~~ rental arrangements we have with our customers is the risk that once a lease or rental arrangement is consummated, we may not receive, or may experience a delay in realizing, all of the compensation ~~and~~ and other amounts to be paid in respect of the chassis subject to that lease or rental arrangement, particularly with respect to our motor carrier customers. Although we experienced small increases in provisions for doubtful accounts as a result of the motor carrier customers' increased credit risk such increases have moderated in recent months. See "—We intend to grow our business by enabling our shipping line customers to transition to the motor carrier model, which may subject us to business and financial risk." We attempt to mitigate this risk by requesting that our customers provide us with detailed financial information regarding their operations and, where such information is not provided, by relying on reports from credit agencies and other available credit information and, in some cases, by requiring deposits. However, there can be no assurance that they can or will fulfill their obligations under the contracts we enter into with them. Our customers could encounter financial difficulties, or otherwise have difficulty making payments to us when due as a result

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lease or rental arrangement, particularly with respect to our motor carrier customers. See "The ongoing transition of shipping lines to the motor carrier model may subject us to business and financial risk." We attempt to mitigate this risk by requesting that our customers provide us with detailed financial information regarding their operations and, where such information is not provided, by relying on reports from credit agencies and other available credit information and, in some cases, by requiring deposits. However, there can be no assurance that they can or will fulfill their obligations under the contracts we enter into with them. Our customers could encounter financial difficulties, or otherwise have difficulty making payments to us when due as a result of any number of factors which may be out of our control and which we may be unable to anticipate. IfFor example, Hanjin Shipping Co. Ltd.'s bankruptcy filing in the third quarter of 2016 (the "Hanjin Bankruptcy") caused us to write off per diem and other charges. While Hanjin wasn't one of our larger customers, if one or more of our largest customers or a sufficient number of our customers were to default due to difficulties in securing financing, weak economic growth or otherwise, it could have a material adverse effect on our results of operations. See "—The inability of one or more of our customers to meet their obligations to us or a decrease in customer creditworthiness may adversely affect our business, financial condition and results of operations."

Defaults by our customers not only cause us to lose revenues for past services, but also result in increased expenses for storage, collection and recovery of our chassis. ~~Repossession~~While repossession of chassis from defaulting customers may be difficult and expensive, in the case of the Hanjin Bankruptcy, we have yet to incur such expenses because we have been able to hold the motor carriers responsible for returning the chassis to our pools. See "—The international nature of the industry exposes us to numerous risks." Furthermore, we may be unable to re-lease this recovered equipment at comparable rates or on comparable terms, if at all. An increase in the incidence of defaults by our customers could therefore materially adversely affect our financial condition and results of operations.

In addition, our ABL Facility (as defined herein) requires us to identify the chassis leased by a defaulting customer and to reclassify such chassis (or the book value thereof) as ineligible for the purpose of serving as security for the underlying indebtedness. InWhile in certain cases, this may require us to repay a portion of the affected indebtedness sooner than anticipated, we did not make any such repayment in connection with the Hanjin Bankruptcy since we maintained sufficient collateral.

The inability of one or more of our customers to meet their obligations to us or a decrease in customer creditworthiness may adversely affect our business, financial condition and results of operations.

Our top 10 customers accounted for approximately 4138%, 4541%, and 5245% of our total revenues in ~~2015~~2016, ~~2014~~2015 and ~~2013~~2014, respectively. The ~~concentration~~ concentration of customers may impact our overall financial results since these entities may be similarly affected by changes in economic or other conditions. A significant reduction in utilization by one of these customers or the loss of one of our top customers could adversely affect our business, financial condition and results of operations.

We rely on timely and regular payments from our customers on ordinary course business terms and a deterioration in the credit quality of several of our major customers could have a ~~material~~ material adverse effect on our financial condition and results of operations. Although we do not believe there is significant risk in connection with our concentration of credit, the inability or failure of ~~our~~ significant customers to meet their obligations to us or their insolvency or liquidation may adversely affect our business, financial condition and results of operations. In addition, the ~~industry~~ industry shift toward the motor carrier model exposes us to increased credit risk. See "—WeThe ~~intend~~ongoing totransition ~~grow~~of ~~our business by enabling our~~ shipping ~~line~~lines ~~customers~~ to ~~transition to~~ the motor carrier model, ~~which~~ may subject us to business and financial risk."

In addition, some of the contracts under which we lease our chassis contain early termination provisions. Although early termination fees and costs associated with repairs and repositioning are borne by the lessee and are intended to discourage early terminations, we cannot predict whether the number of leases that our customers terminate early will increase in the future.

We intend to continue to grow our business by enabling our shipping line customers to transition to the motor carrier model, which may subject us to business and financial risk.

Over the past several years, nearly every major shipping line serving the United States has implemented a new business model known as the "motor carrier model." Under the motor carrier model, the shipping lines no longer provide chassis to their customers as part of their transportation service, thereby shifting the responsibility for providing chassis to the motor carriers that haul the chassis and containers. We have already transitioned a majority of our shipping line customers to the motor carrier model in various geographic areas across the country. We intend to continue to use this transition as an opportunity to differentiate and grow our business. If we encounter unforeseen expenses, difficulties, complications or delays in connection with our operations under the motor carrier model, such as motor carriers deciding to enter into chassis pooling arrangements like the North

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~~American~~ ~~Chassis~~ The ~~Pool~~ongoing ~~Cooperative~~transition ~~(the~~of ~~"NACPC") with other motor carriers, rather than obtaining chassis from us, or if our~~ shipping ~~line~~lines ~~customers consolidate operations and thereby require fewer chassis, we may not be able~~ to ~~grow~~the ~~our~~motor ~~business~~carrier asmodel ~~rapidly as anticipated or at all and our results of operations~~ may besubject ~~adversely~~us ~~affected. See "—We operate in a highly competitive and dynamic industry, which may adversely affect our results of operations or our ability~~ to ~~expand our~~ business" and ~~"—Our~~ ~~future business prospects could be adversely affected by consolidation within the container shipping industry~~financial risk."

~~In addition~~Over the past several years, ~~under~~nearly every major shipping line serving the ~~motor~~United States has implemented a new business model known as the "motor carrier model,." Under the motor carrier ~~and~~model, ~~not~~ the shipping ~~line~~lines isno inlonger ~~many~~provide ~~cases~~chassis to their customers as part of their transportation service, thereby shifting the ~~party~~responsibility ~~responsible~~for providing chassis to ~~pay~~the ~~for~~motor carriers that haul the ~~use~~chassis and containers. We have already transitioned nearly all of our ~~chassis.~~shipping ~~Typically,~~line customers to the motor carrier model in various geographic ~~companies~~areas ~~are~~across ~~much~~the ~~smaller~~country. ~~than~~If ~~shipping~~we ~~line~~encounter ~~companies~~unforeseen ~~and~~expenses, asdifficulties, acomplications ~~result~~or ~~are~~delays ~~often~~in aconnection ~~greater~~with ~~credit~~our ~~risk.~~operations ~~Although~~under the ~~per~~motor ~~diem~~carrier ~~rates~~model, wesuch ~~charge~~as motor carriers ~~are~~deciding ~~priced~~ to enter ~~take~~into ~~account~~chassis ofpooling ~~this increased~~arrangements ~~credit~~like ~~risk,~~the ~~our~~North ~~provision~~American ~~for~~Chassis ~~doubtful~~Pool ~~accounts~~Cooperative ~~has~~(the ~~increased~~"NACPC") ~~from~~with another ~~average~~motor ofcarriers ~~0.5%~~or ofpurchasing ~~aggregate~~their ~~revenue~~own chassis, rather than obtaining chassis from ~~2009-2011~~us, or toif ~~1.3%~~our ofshipping ~~aggregate~~line ~~revenue~~customers ~~for~~consolidate ~~the~~operations and ~~period~~thereby ~~from~~require ~~January 1~~fewer chassis, ~~2012~~ we may not be able to ~~December 31,~~grow ~~2015~~our business as rapidly as anticipated or at all and our results of operations may be adversely affected. AnSee "—We ~~increase~~operate in ~~doubtful~~a ~~accounts~~highly competitive and dynamic industry, which may ~~continue~~adversely asaffect aour ~~result~~results of ~~the~~operations ~~transition~~or our ability to ~~the~~expand ~~motor~~our business" ~~carrier~~and ~~model.~~"—Our future business prospects could be adversely affected by consolidation within the container shipping industry."

In addition, under the motor carrier model, the motor carrier and not the shipping line is in many cases the party responsible to pay for the use of our chassis. Typically, motor carrier companies are much smaller than shipping line companies and as a result are often a greater credit risk. Although the per diem rates we charge motor carriers are priced to take account of this increased credit risk, our provision for doubtful accounts has increased from an average of 0.5% of aggregate revenue from 2009-2011 to 1.3% of aggregate revenue for the period from January 1, 2012 to December 31, 2016. An increase in doubtful accounts may continue as a result of the transition to the motor carrier model.

Moreover, under the motor carrier model, the motor carriers are required to indemnify us against claims arising from their use of our chassis. While we require the motor carriers to maintain insurance against such claims, we only require them to maintain $1.0 million of such insurance instead of the $2.0 million we typically require of our shipping line customers. Although we carry insurance that will provide coverage for claims related to the use of our chassis by the motor carriers, our insurance premiums may increase in the future as a result of the lower levels of coverage maintained by the motor carriers and other reasons relating to our transition to the motor carrier model.

Lastly, procedures for preventing use of our chassis by unauthorized motor carriers ("gate control procedures") may be inadequate at certain terminals. An unauthorized motor carrier is a motor carrier that has not accepted the terms of our rental agreement and/or met our credit and insurance requirements. Within the context of the motor carrier model, where in many instances we may no longer look to the shipping line for fulfillment of any of the usual payment, indemnity or insurance obligations, such inadequate gate control procedures may enhance the risks related to collection (for which we attempt to compensate by billing unauthorized motor carriers at significantly higher rates than we bill authorized motor carriers), recovery of our chassis and exposure to third-party claims. If our efforts to work with these terminals to enhance their gate control procedures fail, the risks associated with unauthorized motor carrier use at such terminals may adversely affect our business, financial condition and results of operations.

We have expanded our business by providing logistics services related to drayage which may subject us to business and financial risk.

We formed a new entity in 2013, TRAC Logistics LLC, ~~d/b/a TRAC Transportation~~ ("TRAC Logistics"), which will broker drayage services on behalf of third parties and has ~~begun~~been tobrokering ~~reposition~~drayage services in connection with the repositioning of our chassis in certain geographic locations throughout the United States. As TRAC Logistics will be performing certain services that we have not previously performed, there are risks that this business may not be successfully managed and/or that it may encounter unforeseen expenses, difficulties, complications and delays frequently encountered in connection with starting a new business line. If this were to occur, it could impair our growth and require us to provide oversight and dedicate resources to these businesses rather than to other profitable areas.

We also intend to expand our business by establishing various service centers and mobile service units, which may subject us to business and financial risk.

During 2013 and 2014, we opened three additional service centers to add to our Woodbridge, New Jersey facility, which was already in operation. These additional service centers are located in Chicago,

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~~Illinois;~~Logistics ~~Los~~is ~~Angeles,~~performing California; and Seattle, Washington. Moreover, in 2015 we signed leases for three more service centers located in Jacksonville, Florida, Houston, Texas and Oakland, California. These service centers will be operational in the first quarter of 2016. We anticipate that service centers will allow us to, among other things, store our chassis and axles on property that we lease which we believe will give us better control over certain of our assets and ultimately allow us to save on the storage fees we currently pay to third parties. We have also begun a pilot program in Chicago utilizing mobile service units to provide roadside service on our chassis leased by our lessees. Additionally, we have recently closed on a transaction involving the acquisition of an emergency road service company based in Kentucky. We will use these mobile service units along with our service center locations to perform maintenance and repair on our chassis instead of paying third parties to perform such maintenance and repair services. ~~We believe~~ that ~~performing such maintenance and repair services ourselves will also result in cost savings. As~~ we dohave not ~~have~~previously ~~significant experience in operating service centers or mobile service units~~performed, there are risks that wethis business may not be ~~able to~~ successfully ~~manage~~managed ~~such service centers or mobile service units~~ and/or that weit may encounter unforeseen expenses, difficulties, complications and delays frequently encountered in connection with ~~undertaking~~starting a new ~~initiatives~~business line. If this were to occur, ~~we may~~it ~~not~~could ~~realize~~impair ~~the~~our ~~cost~~growth ~~savings~~and werequire ~~expect~~us ~~from~~to ~~the~~provide ~~operation~~oversight ~~of the service centers~~ and dedicate ~~mobile~~resources ~~service~~to ~~units~~these ~~and~~businesses asrather athan ~~result,~~to ~~our~~other ~~business~~profitable ~~could be adversely impacted~~areas.

In ~~addition,~~ We wealso ~~will~~intend ~~lease~~to ~~the~~expand ~~land~~our ~~and~~business ~~buildings~~by ~~necessary~~establishing tovarious ~~operate our~~ service centers. ~~Such properties are typically located in heavily industrial areas that potentially contain pollutants or other hazardous materials in the soil~~ and~~/or~~ ~~groundwater.~~mobile ~~It is also possible that as a result of the activities conducted at the~~ service ~~centers~~units, ~~certain pollutants or other hazardous~~which ~~materials~~ may besubject released into the soil and/or groundwater. While we maintain pollution insurance that covers certain types of environmental liabilities and the landlords from whom we lease these properties typically indemnify us, ~~at a minimum, against environmental liabilities that existed prior~~ to our occupying these sites, such insurance and indemnities may not cover, or be sufficient to protect us against, losses from all environmental damage. See "—Environmental liability may adversely affect our business and financial ~~situation~~ risk."

As of December 31, 2016, we are operating seven service centers located in New Jersey, Illinois, California, Washington, Florida and Texas. Our service centers allow us to, among other things, store our chassis and axles on property that we lease which we believe gives us better control over certain of our assets and ultimately allows us to save on the storage fees we would otherwise pay to third parties. We have also begun utilizing mobile service units to provide roadside service on our chassis leased by our lessees. Additionally, in February 2016 we closed a transaction involving the acquisition of an emergency road service company based in Kentucky. We will use these mobile service units along with our service center locations to perform maintenance and repair on our chassis instead of paying third parties to perform such maintenance and repair services. We believe that performing such maintenance and repair services ourselves will also result in cost savings. As we do not have significant experience in operating service centers or mobile service units, there are risks that we may not be able to successfully manage such service centers or mobile service units and/or that we may encounter unforeseen expenses, difficulties, complications and delays frequently encountered in connection with undertaking new initiatives. If this were to occur, we may not realize the cost savings we expect from the operation of the service centers and mobile service units and as a result, our business could be adversely impacted.

In addition, we lease the land and buildings necessary to operate our service centers. Such properties are typically located in heavily industrial areas that potentially contain pollutants or other hazardous materials in the soil and/or groundwater. It is also possible that as a result of the activities conducted at the service centers, certain pollutants or other hazardous materials may be released into the soil and/or groundwater. While we maintain pollution insurance that covers certain types of environmental liabilities and the landlords from whom we lease these properties typically indemnify us, at a minimum, against environmental liabilities that existed prior to our occupying these sites, such insurance and indemnities may not cover, or be sufficient to protect us against, losses from all environmental damage. See "—Environmental liability may adversely affect our business and financial situation."

We have a substantial amount of indebtedness, which may adversely affect our cash flow and our ability to operate our business.

As of December 31, ~~2015~~2016, we had approximately $1.081 billion aggregate principal amount of indebtedness outstanding, which represents approximately 5859.5% of our total capitalization. Our substantial indebtedness could have important consequences, including:

•: increasing our vulnerability to adverse economic, industry or competitive developments;
•: requiring a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, thereby reducing our ability to use our cash flow to fund operations, capital expenditures and future business opportunities;
•: making it more difficult for us to satisfy our obligations with respect to the Notes;
•: restricting us from making strategic acquisitions or causing us to make non-strategic divestitures;

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•: limiting our ability to obtain additional financing for working capital, capital expenditures, product development, debt service requirements, acquisitions and general corporate or other purposes; and
•: limiting our flexibility in planning for, or reacting to, changes in our business or the industry in which we operate, placing us at a competitive disadvantage compared to our competitors who are less highly leveraged and who therefore may be able to take advantage of opportunities that our leverage prevents us from exploiting.

Despite our substantial indebtedness level, we and our subsidiaries will still be able to incur significant additional amounts of debt, which could further exacerbate the risks associated with such indebtedness.

We may be able to incur substantial additional indebtedness in the future. Although our ABL Facility and our indenture governing the Notes contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of significant qualifications and exceptions and, under certain circumstances, the amount of indebtedness that could be incurred in compliance with these restrictions could be substantial. If new debt is added to our existing debt levels, the related risks that we now face would increase. Further, as of December 31, ~~2015~~2016, we have drawn $~~867~~1,032.0 million under the ABL Facility.

Our debt agreements contain restrictions that limit our flexibility in operating our business.

The indenture governing the Notes and our ABL Facility contain various covenants that limit our ability to engage in specified types of transactions. The indenture and the ABL Facility covenants limit our and our restricted subsidiaries' ability to, among other things:

•: incur additional indebtedness or prepay indebtedness;
•: pay dividends on, repurchase or make distributions in respect of our capital stock or make other restricted payments;
•: make certain investments;
•: sell, transfer or convey certain assets, including our chassis;
•: incur liens;
•: designate our subsidiaries as unrestricted subsidiaries;
•: sell capital stock of our subsidiaries;
•: make capital expenditures;
•: enter into the sale and leaseback of our chassis;
•: compete effectively to the extent our competitors are subject to less onerous financial restrictions;
•: consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; and
•: enter into certain transactions with our affiliates.

In addition, the ABL Facility requires us to comply with certain financial covenants, ~~including~~if aavailability ~~minimum fixed charge coverage ratio of 1.00 to 1.00, subject to exceptions and limitations, and a maximum senior secured leverage ratio, which~~ is ~~currently~~less ~~5.25~~than tocertain 1triggers.~~00,~~ ~~and is scheduled to decrease until the maturity date of the ABL Facility.~~ As of December 31, ~~2015~~2016, our fixed charge coverage ratio was 31.0265 to 1.00 and our senior secured leverage ratio was 45.1042 to 1.00. In the future, there is a risk that we could not be in compliance with our financial covenants. See Note 7 "Borrowings" to our Consolidated Financial Statements under the heading "ABL Facility".

Although as of December 31, 2015, we were in compliance with all covenants under the indenture, the ABL Facility and other agreements, a breach of any of these covenants or covenants contained in future agreements could result in a default under the indenture, the ABL Facility or such future agreements, which could have the effect, if not remedied, of causing an event of default. In addition, any debt agreements we enter into in the future may further limit our ability to enter into certain types of transactions. Upon the occurrence of an event of default under any of the agreements governing our indebtedness, the applicable lenders or holders of the debt could elect to declare all amounts outstanding to be due and payable and exercise other remedies as set forth in the applicable agreements. If any of our indebtedness were to be accelerated, there can be no assurance that our assets would be sufficient to repay this indebtedness in full, which could have a material adverse effect on our ability to continue to operate as a going concern.

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Although as of December 31, 2016, we were in compliance with all covenants under the indenture, the ABL Facility and other agreements, a breach of any of these covenants or covenants contained in future agreements could result in a default under the indenture, the ABL Facility or such future agreements, which could have the effect, if not remedied, of causing an event of default. In addition, any debt agreements we enter into in the future may further limit our ability to enter into certain types of transactions. Upon the occurrence of an event of default under any of the agreements governing our indebtedness, the applicable lenders or holders of the debt could elect to declare all amounts outstanding to be due and payable and exercise other remedies as set forth in the applicable agreements. If any of our indebtedness were to be accelerated, there can be no assurance that our assets would be sufficient to repay this indebtedness in full, which could have a material adverse effect on our ability to continue to operate as a going concern.

We may not be able to generate sufficient cash to service our indebtedness, and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.

Our ability to make scheduled payments on or to refinance our debt obligations depends on our financial condition and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business and other factors beyond our control. We may not be able to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness.

If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, or to sell assets, seek additional capital or restructure or refinance our indebtedness. Our ability to restructure or refinance our debt will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. The terms of our existing or future debt instruments may restrict us from adopting some of these alternatives. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations.

We have incurred net losses in two of the last three years and may not be profitable in the future.

We incurred net losses of $3.0 million and $29.4 million for the years ended December 31, 2014 and 2013, respectively. While we realized net income of $26.7 million for the year ended December 31, 2015, we cannot make any assurance that we will be profitable in the future. No assurance can be given that we can achieve or sustain profitability on a quarterly or annual basis in the future. Even if we achieve profitability, we may experience significant fluctuations in our revenues and expenses and we may incur net losses from period to period.

If we are unable to secure our customers' confidential and credit card information or other private data relating to our employees, suppliers or the Company, we could be subject to negative publicity, costly government enforcement actions or private litigation, which could damage our business reputation and adversely affect our results of operations.

The protection of our customer, employee and Company data is critical to us. We and/or our third-party service providers have procedures and technology in place to safeguard our customers' credit card information, our employees' private data, suppliers' data, and the Company's records and intellectual property.

Despite taking relevant actions to comply with our procedures and other information security measures, we cannot be certain all our information technology ("IT") systems or those of our third-party service providers are able to prevent, contain or detect any cyber-attacks, cyber- terrorism, or security breaches from known malware or malware that may be developed in the future. As evidenced by other companies who have recently suffered serious security breaches, we and our third-party service providers may be vulnerable to, and unable to detect and appropriately respond to, data security breaches and data loss, including cyber-security attacks. If we or our third-party service providers experience a data security breach of any kind, whether external, internal or misuse of sensitive data, it could have the following impacts:

•: negative publicity, government enforcement actions, private litigation, penalties or costly response measures, which may not be covered by our insurance policies;

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•: our reputation within our industry and with our customers may be affected, which could result in our customers discontinuing the use of credit cards with us;
•: the expenditure of significant time and costs to protect compromised customers' or employees' personal data and to restore their confidence in us; and
•: a disruption of our operations which could require us to make changes to our information systems and administrative processes to address security issues and compliance with applicable laws and regulations.

Potential and existing customers may decide to buy rather than lease chassis.

We, like other suppliers of leased chassis, are dependent upon decisions by shipping lines, railroads and motor carrier companies to ~~lease~~ lease rather than buy their equipment. Most of the factors affecting the decisions of our customers to buy or lease are outside our control, such as the cost of new and remanufactured chassis, the availability of financing for chassis, interest rates and foreign currency values. ~~For~~One ~~example, one~~ of our key initiatives to increase our revenue and improve our financial results is to adjust our per diem rates in our marine and domestic pools to appropriately reflect the added value we provide through our chassis management and pool operations. However, we may not be successful in implementing this pricing strategy or retaining our customers following any price increase, and some of our customers may elect to purchase rather than lease chassis at higher rates, all or any of which could adversely affect our business and results of operations. For example, one of our ten largest customers has decided to buy chassis and, as a result, is expected to no longer be a substantial customer of ours by the end of 2017. Should one or more of these factors influence our current or prospective customers to buy a larger percentage of the chassis assets they operate, rather than lease these assets from us, our utilization rate would decrease, adversely affecting our results of operations and cash flow.

If our customers continue to shift to chassis pool rentals and continue to transition to the motor carrier model, our long-term lease and direct finance lease products will be adversely affected.

The accelerating trend over the past several years away from term and direct finance lease products toward chassis pools may negatively ~~impact~~ impact our long-term and direct finance lease products. From 2006 to ~~2015~~2016, chassis in pools as a percentage of our overall fleet has increased from 29% to 8284% and our term lease and direct finance ~~lease~~ lease fleet has declined from 71% to 1816% over the same period. If this trend away from term and direct finance lease products toward pools continues, the predictability and stability of lease renewal ~~rates~~ rates that we have experienced for our term lease and direct finance lease products may be adversely affected. In addition, the continuing transition to the motor carrier model, where the responsibility for providing chassis is shifted from the shipping lines to the motor carriers, may also cause a decrease in our term lease products since we primarily lease our chassis to motor carriers from our chassis pools and not under term leases. See "—WeThe ~~intend~~ongoing totransition ~~grow~~of ~~our business by enabling our~~ shipping ~~line~~lines ~~customers~~ to ~~transition to~~ the motor carrier model, ~~which~~ may subject us to ~~considerable~~ business and financial risk."

Our future business prospects could be adversely affected by consolidation within the container shipping industry.

Although we have increased the number of our chassis that are leased to motor carriers as a result of the motor carrier model, a ~~significant~~ significant portion of our business continues to be dependent on the leasing of chassis to shipping lines. ~~In the past~~Recently, there have been several large shipping line acquisitions and/or mergers that have resulted in some consolidation within the intermodal shipping industry, including among some of our customers. This consolidation reduced the number of large shipping lines and also increased the concentration of business in a smaller number of larger customers. Our future business prospects could be adversely affected if the number of shipping lines is further reduced, as this would result in ~~fewer~~even ~~customers~~fewer customers that require fewer chassis as a result of the economies of scale and increased operating efficiencies. In this regard, several of our large shipping line customers have recently announced plans to consolidate operations and/or merge in the near future. Due to concentration risk and the resulting impact on credit risk, we might decide to limit the amount of business exposure we have with any single customer if the exposure were deemed unacceptable, which could negatively impact the volume

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and increased operating efficiencies. Due to concentration risk and the resulting impact on credit risk, we might decide to limit the amount of business exposure we have with any single customer if the exposure were deemed unacceptable, which could negatively impact the volume of chassis we lease and the revenues we would otherwise earn if we had leased chassis despite the concentration risk or the previously separate customers had not been combined.

We operate in a highly competitive and dynamic industry, which may adversely affect our results of operations or our ability to expand our business.

The chassis leasing industry is highly competitive. We compete with other domestic leasing companies, intermodal shipping companies (including a logistics company that maintains a proprietary fleet of approximately 7974,000 nonstandard specification domestic chassis), banks offering finance leases and promoters of equipment ownership and leasing as an investment as well as with non-intermodal shipping companies, such as motor carriers, that provide for the transportation of goods without the use of chassis. Some of these competitors have greater financial resources and access to capital than we do. Furthermore, chassis fleets may be shared between member contributors, who have the responsibility to manage or delegate the management of the operation as part of co-operative ("Co-op") chassis pools. For example, the ports in the Los Angeles/Long Beach area (the "LA/LB") have allowed chassis providers to establish and operate a port-wide "pool of pools" involving three independently managed pools in which users of each pool are permitted to use the chassis from the other pools on a free-flow interchange basis. Ports in other parts of the country are reviewing other alternative chassis pool models, including port-wide Co-op chassis pools or "Market Pools". The introduction of a Market Pool into an area where previously we maintained a neutral chassis pool may have the effect of increasing competition. For example, various stakeholders in the New York/New Jersey ports area (where we currently operate one of our ~~largest~~ largest neutral ~~pool~~pools of marine chassis) are seeking an alternative pool structure and we are currently discussing the formation of a Market Pool to replace our neutral pool in the area. If we form a Market Pool, we ~~would~~could give up some control over the management of our chassis ~~to third parties~~, which may expose us to unforeseen risks if the third parties take actions that are unfavorable to us. Additionally, because we are working more closely with our competitors in connection with the new Market Pools and other chassis pool structures (such as the pool of pools), we may be exposed to antitrust regulatory risk. Moreover, if the available supply of chassis were to increase significantly as a result of, among other factors, new companies entering the business of leasing or selling chassis, our competitive position could be adversely affected. For example, the Surface Transportation Board of the Department of Transportation has granted permission for the motor carrier members of the NACPC to pool resources to acquire, lease and share chassis. According to its website, the NACPC currently operates a fleet of more than 818,~~500~~000 chassis in ~~three~~four cooperative pools managed by Consolidated Chassis Management, LLC. New entrants, such as the NACPC, could put significant downward pressure on lease rates and margins and adversely affect our ability to achieve our growth plans. See "Management's Discussion and Analysis—Operations—Competition."

Competition among chassis leasing companies depends upon many factors, including, among others, lease rates, lease terms (including lease duration, drop-off restrictions and repair provisions), customer service and the location, availability, quality and individual characteristics of the equipment. As a result, the entry of new market participants together with the already highly competitive nature of our industry may undermine our ability to maintain a high level of asset utilization or, alternatively, could force us to reduce our pricing and accept lower revenue and profit margins in order to achieve our growth plans.

The chassis leasing industry is also dynamic. To remain competitive, we are participating in the LA/LB pool of pools and have incorporated into our business model plans to expand ~~our~~ our geographic footprint, increase the number of our service centers, participate in and manage Market Pools, grow our owned and managed marine chassis fleet, grow our domestic intermodal business, and grow our margin through top-line and strict expense control actions. In addition, we anticipate that we will continue our efforts to transition any remaining shipping line customers to the motor carrier model. There is a risk that we will be unable to successfully implement these business strategies in response to

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~~changes~~margin through top-line and strict expense control actions. In addition, we anticipate that we will continue our efforts to transition any remaining shipping line customers to the motor carrier model. There is a risk that we will be unable to successfully implement these business strategies in response to changes in industry trends or that they may prove less profitable than anticipated, either of which could negatively impact our results of operations. See "—We intend to pursue acquisition opportunities, which may subject us to considerable business and financial risk.", "—WeThe ~~intend~~ongoing totransition ~~grow~~of ~~our business by enabling our~~ shipping ~~line~~lines ~~customers~~ to ~~transition~~ to the motor carrier model, ~~which~~ may subject us to business and financial risk.", "—We also intend to expand our business by establishing various service centers, which may subject us to business and financial risk."

The loss of our exclusive rights to operate our domestic chassis pools at certain railroad ramps nationwide may adversely affect our business.

We have exclusive arrangements with five of the seven Class I railroads that carry freight in the United States, allowing us to operate a pool primarily for domestic 53' chassis at many of their railroad ramps for our pool customers. If one or more of these agreements is not renewed or is terminated and we no longer have the exclusive right to operate such pool at the ramps covered by that agreement, our business could be adversely affected. In this regard, we have been advised by one of the Class I railroads that they intend to terminate the exclusive nature of their agreement with us at some point in 2016. We are currently in negotiations with this Class I railroad about an alternative non-exclusive agreement with us.

U.S., Canadian and/or global economic conditions and uncertainty could adversely affect our business, results of operations and financial condition.

A failure of the global economy and credit markets to continue their recoveries, delays in their recoveries, or a deterioration of ~~economic~~ economic conditions in the global economy and credit markets could heighten a number of material risks to our business, cash flows and financial condition, as well as our future prospects. Weakness in, and uncertainty about, global economic conditions could cause businesses to postpone spending in response to tighter credit, negative financial news or declines in income or asset values, which could have a material adverse effect on the demand for goods and international trade which, in turn, could adversely affect the demand for our chassis. These risks may be further exacerbated by adverse foreign currency translations. There could also be a number of follow-on effects from these economic developments and negative economic trends to our business, including customer insolvencies, decreased customer confidence in making long-term leasing decisions, decreased customer demand, decreased customer liquidity due to tightening in the credit markets and decreased customer ability to fulfill their payment obligations. Political changes and uncertainty surrounding the new U.S. presidential administration and its policies and regulations and Brexit may also adversely affect our business and profitability. See "—The demand for leased chassis depends on many economic, political and other factors beyond our control and a decrease in the volume of world trade and other factors may adversely affect our business."

We further believe that many of our customers ~~are~~rely ~~reliant~~ on liquidity from global credit markets and, in some cases, require external financing to fund a portion of their operations. If ~~our~~ our customers lack liquidity, they may not be able to pay amounts due to us, which could negatively impact our business.

Our inability to service our debt obligations or to obtain additional financing as needed would have a material adverse effect on our business, financial condition and results of operations.

As of December 31, ~~2015~~2016, we had approximately $419.42 million of scheduled debt maturities during the year ending December 31, ~~2016~~ 2017. These amounts do not include $9370.49 million of other contractual obligations existing as of December 31, ~~2015~~2016 and maturing by December 31, ~~2016~~2017. Although our current projections of cash flows from operations are expected to be sufficient to fund our maturing debt and contractual obligations over the next 12 month period, no assurance can be made that we will be able to meet our financing and other liquidity needs as currently contemplated.

In addition, we expect to invest substantial funds to acquire new and used chassis and to refurbish and remanufacture chassis, although there can be no assurances as to the timing and amount of such acquisitions. We intend to continue funding asset purchases through cash flows from our operations, collections of principal on direct finance leases, secured and unsecured debt securities and our ABL Facility. Although we believe that we will be able to generate or otherwise obtain sufficient capital to support our growth strategy, deterioration in our performance or the credit markets or our inability to borrow under the ABL Facility or obtain alternative financing on attractive terms, or at all, could limit our access to funding or drive the cost of capital higher than our current cost and could adversely affect our business, financial condition and results of operations.

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collections of principal on direct finance leases, secured and unsecured debt securities and new lines of credit. Although we believe that we will be able to generate or otherwise obtain sufficient capital to support our growth strategy, deterioration in our performance or the credit markets or our inability to obtain additional financing on attractive terms, or at all, could limit our access to funding or drive the cost of capital higher than our current cost and could adversely affect our business, financial condition and results of operation.

We face risks associated with re-leasing chassis after their initial lease.

Chassis have a useful economic life of approximately 20 years and 22.5 years for domestic and marine chassis, respectively. At the end of their economic life, chassis can be remanufactured, which we believe can extend the economic life by approximately an additional 20 to 22.5 years at a material cash savings compared to the cash required to purchase a new chassis. As our term leases typically provide for a fixed lease term from 1 to 5 years, and our other chassis leasing arrangements are for shorter terms, our chassis are not leased out for their full economic life and we face risks associated with re-leasing chassis after their initial long-term lease at a rate that continues to provide a reasonable economic return. If prevailing chassis lease rates decline significantly between the time a chassis is initially leased out and when its initial long-term lease expires, or if overall demand for chassis declines, we may be unable to earn a sufficient lease rate from the re-leasing of chassis when its initial term lease expires. This could materially adversely impact our results and financial performance.

Certain liens may arise on our equipment.

Almost all of our leasing equipment assets are currently subject to and will be subject to liens relating to the ABL Facility or certain of our other existing financing arrangements. In the event of a default under any of those arrangements, the lenders thereunder would be permitted to take possession of or sell such leasing equipment assets.

In addition, depot operators, repairmen, transporters, and other parties who come into possession of our chassis from time to time may have sums due to them from us or from our lessees of the chassis. Although our agreements with such depot operators, repairmen, transporters and other parties generally prohibit them from permitting any liens to exist on our chassis or from prohibiting access to chassis that are in their possession, in the event of nonpayment of those sums, we may be delayed in, or entirely barred from, repossessing the chassis or be required to make payments or incur expenses to discharge such liens on the equipment.

Changes in market price, availability or transportation costs of, ~~equipment~~or import duties imposed on, equipment manufactured in China, or Mexico or other foreign countries could adversely affect our ability to maintain our supply of chassis.

We purchase a substantial amount of our domestic chassis from manufacturers in China and Mexico. In addition, almost all of our marine ~~chassis~~ chassis are equipped with bias ply tires which are manufactured ~~almost exclusively~~ in China and other foreign countries. Any changes in the political, economic or financial condition in China, Mexico or ~~Mexico~~other foreign countries that increase the market price, limit availability or increase transportation costs of the chassis and/or tires ~~manufactured in either of these countries~~ could adversely affect our ability to maintain our chassis supply. If the costs associated with purchasing or transporting chassis and/or tires from China, Mexico or ~~from~~other ~~Mexico~~foreign countries were to increase for any reason, including potential changes in United States trade policy toward ~~China~~such ~~or Mexico~~countries, increased tariffs or duties imposed by the United States or other governments or a significant downturn in the economic situation in ~~China~~those orforeign ~~Mexico~~countries, we could be forced to seek alternative sources of chassis and/or tires or to pay more for those chassis and/or tires. ~~Recently~~Additionally, ~~the~~existing ~~United~~trade ~~Steel~~laws, regulations ~~Paper~~ and ~~Forestry~~agreements, ~~Rubber,~~such ~~Manufacturing,~~as ~~Energy~~the North American Free Trade Agreement, ~~Allied~~provide ~~Industrial~~certain beneficial duties and ~~Service~~tariffs ~~Workers~~for ~~International~~qualifying ~~Union,~~imports ~~AFL-CIO~~and exports, ~~CLC (the~~subject ~~"USW")~~to ~~filed~~compliance ~~petitions~~ with the Uapplicable classification and other requirements.S. ~~International~~Changes ~~Trade~~in ~~Commission~~laws ~~("USITC")~~or ~~and~~policies governing the ~~U.S.~~terms ~~Department~~ of ~~Commerce~~foreign ~~("DOC")~~trade, ~~for~~and ~~the~~in ~~imposition~~particular ofincreased ~~antidumping~~trade ~~("AD")~~restrictions, ~~and~~tariffs ~~countervailing~~or ~~duty~~taxes ~~orders~~on imports from countries from ~~("CVD")~~which onwe ~~truck~~purchase domestic chassis, ~~bus~~such as China and ~~trailer~~Mexico, could have a material adverse effect on our business and financial results. See "—The international nature of the industry exposes us to numerous risks".

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tires ("BTT Tires") manufactured in China and imported into the U.S. The investigations cover the bias ply and radial tires we use on our chassis. If there is a finding that the BTT Tires manufactured in China are being sold in the U.S. for amounts at less than fair value and/or that the Chinese government is subsidizing the manufacturing costs of the BTT Tires being exported and that such actions are causing material injury or threaten material injury to an industry in the U.S., the DOC will impose remedial AD and/or CVD duties on the subject BTT Tires imported from China. These duties would force us to obtain tires from other sources or otherwise pay the increased cost for the Chinese imports. In either event, such an outcome could substantially increase our operating costs. See "—The international nature of the industry exposes us to numerous risks".

Storage space for chassis may become limited, thereby increasing depot costs for the storage of chassis.

Land in and around many port terminals and railroad ramps is limited, and nearby depot space has become difficult to find and more costly with limited space and fewer depots in the area. In addition, local communities in port areas and railroad yards may impose regulations that prohibit the storage of chassis near their communities, further limiting the availability of storage facilities and increasing the cost of storage, repairs, and transportation charges relating to the use of our chassis. In addition, depots in prime locations may become filled to capacity based on market conditions and may refuse additional redeliveries due to space constraints. Any of these developments could require us to enter into higher cost storage agreements with depot operators in order to accommodate our customers' redelivery requirements and could result in increased costs and expenses for us.

We depend on key personnel, and we may not be able to operate and grow our business effectively if we lose the services of any of our key personnel or are unable to attract qualified personnel in the future.

The success of our business is heavily dependent on our ability to retain our current management and other key personnel and to attract and retain qualified personnel in the future. In particular, we are dependent upon the management and leadership of our Chief Executive Officer and President, Keith Lovetro. Competition for senior management personnel is intense, and although we have entered into at-will employment agreements with certain of our key personnel, these agreements do not ensure that our key personnel will continue in their present capacity with us for any particular period of time. We do not carry insurance for any of our current management or other key personnel. The loss of any key personnel would divert the attention of our remaining key personnel and finding replacement personnel could require substantial time and expense. An inability to find a suitable replacement for any departing executive officer on a timely basis could adversely affect our ability to operate and grow our business.

Strikes, work stoppages or slowdowns by draymen, truckers, longshoremen and/or railroad workers could adversely affect our business and results of operations.

In the past several years, there have been strikes affecting the industries we serve. In the fall of 2002, disputes with longshoremen resulted in the shut-down of all of the West Coast ports, which remained closed for nearly two weeks until they were reopened as the result of a court order under the Taft-Hartley Act. In early December 2011, a railroad strike was narrowly averted right before the expiration of the federally mandated "cooling off period", although the last of the 13 railroad unions did not ratify the National Freight Agreement until April 2012.

Concerns that a strike would occur at the East and Gulf coast ports arose in connection with the negotiations between the International Longshoremen's Association, ~~AFL-CIO~~ ("ILA"), AFL-CIO and the United States Maritime Alliance, Ltd. ("USMA") with regard to their ~~Master~~master ~~Contract~~contract that expired September 30, 2012. At that time, industry sources reported that some shippers had arranged to divert, or had made plans to divert, cargo from the East and Gulf Coast ports to avoid the impact of any work stoppage, slowdowns or other disruptions that would have occurred if these negotiations had failed. The ILA and USMA reached an agreement on March 13, 2013 for a comprehensive successor master contract (the "Master Contract").

The current Master Contract between the ILA and USMA requires any purchaser of chassis from a shipping line to agree to continue to hire ILA labor to perform maintenance and repair work on such chassis following the sale and until September 30, 2018. In addition, industry sources indicate a parallel provision in the NY/NJ Metro Maintenance Contracts Agreement. Several customers bound by the Master Contract have already required a clause in their agreements with us to use ILA labor to perform maintenance and repair work on chassis. Because union labor is typically more expensive than non-union labor, and we purchase chassis from a shipping line that is bound by the Master Contract, it could result in our paying higher maintenance and repair costs on the chassis we purchase than we would otherwise pay if non-union labor were used.

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~~Although~~ Most recently, uncertainty over the ~~ILA~~labor situation at the West Coast ports developed in connection with the negotiations between the PMA and ~~USMA~~the ~~reached~~ILWU ~~agreement~~regarding onthe ~~March 13,~~renewal ~~2013~~of ~~for~~the Pacific aCoast ~~comprehensive~~Longshore ~~successor~~Contract ~~Master~~(the "PCL Contract"), itwhich ~~remains~~had ~~subject~~expired toas ~~agreements~~of ~~being~~June 30, ~~achieved~~2014. While ultimately no strike occurred, in amid-February ~~number~~2015 ofthe ~~local~~PMA ~~union~~curtailed loading and unloading ~~negotiations~~on nights, ~~some~~weekend and holidays, halting vessel operations over the Presidents' Day weekend and limiting workers' ability to earn premium pay. Tactics such as these, as well as other causes, resulted in freight backups during the period of negotiation, especially in the LA/LB, which ~~are~~caused ~~still~~disruptions ~~ongoing~~to supply chains across the country.

The new Master Contract between the ILA and USMA requires any purchaser of chassis from a shipping line to agree to continue to hire ILA labor to perform maintenance and repair work on such chassis following the sale and until September 30, 2018. In addition, industry sources indicate a parallel provision in the NY/NJ Metro Maintenance Contracts Agreement. Several customers bound by the Master Contract have already required a clause in their agreements with us to use ILA labor to perform maintenance and repair work on chassis. Because union labor is typically more expensive than non-union labor, and we purchase chassis from a shipping line that is bound by the Master Contract, it could result in our paying higher maintenance and repair costs on the chassis we purchase than we would otherwise pay if non-union labor were used.

Most recently, uncertainty over the labor situation at the West Coast ports developed in connection with the negotiations between the Pacific Maritime Association ("PMA") and the International Longshore and Warehouse Union ("ILWU") regarding the renewal of the Pacific Coast Longshore Contract (the "PCL Contract"), which had expired as of June 30, 2014. While ultimately no strike occurred, in mid-February 2015 the PMA curtailed loading and unloading on nights, weekend and holidays, halting vessel operations over the Presidents' Day weekend and limiting workers' ability to earn premium pay. Tactics such as these, as well as other causes, resulted in freight backups during the period of negotiation, especially in Long Beach and Los Angeles, which caused disruptions to supply chains across the country.

Any future strikes, work stoppages or slowdowns by the ILA, ILWU, or any other longshoremen or railroad workers in the United States, Canada or anywhere else that our customers' freight travels, could adversely affect our business and results of operations to the extent such strikes, work stoppages or slowdowns affect the ability of our customers to conduct their operations.

If our relationship with our employees were to deteriorate, we may be faced with unionization efforts, labor shortages, disruptions, stoppages, or slowdowns which could adversely affect our business and increase our operating costs or constrain our operating flexibility.

Our operations rely heavily on our employees, and any labor shortage, disruption or stoppage caused by poor relations with our employees could adversely affect our business and reduce our operating margins and income. While none of our employees is currently subject to a collective bargaining agreement, unions have traditionally been active in the shipping, railroad and motor carrier industries, which form our customer base. Moreover, while our workforce has not been subject to union organization efforts in the past, we could be subject to future unionization efforts. Unionization of our workforce could result in higher compensation and working condition demands that could increase our operating costs or constrain our operating flexibility.

In addition, due to the nature of our business, we are subject to laws and regulations, such as the Fair Labor Standards Act, which governs such matters as minimum wage, overtime and other working conditions, which may increase our labor costs and may subject us to fines, penalties and liabilities to our employees.

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We cannot assure you that we or our lessees have or can maintain sufficient insurance to cover losses that may occur to our chassis.

The operation of our chassis fleet involves inherent risks of personal injury and loss of life, damage to our equipment, environmental pollution, and losses due to mechanical failure, human error, political unrest, labor strikes, adverse weather conditions, fire and other factors. The occurrence of any or all of these risks could result in loss of revenues, increased costs and reputational damage or could require us to pay significant damages under certain circumstances. We acquire insurance for our fleet against risks that are common in our industry and we generally require our lessees and depots to maintain all risks physical damage insurance, comprehensive general liability insurance and automobile liability insurance. We also generally require our maintenance and repair and repositioning vendors to maintain general liability insurance. In addition, we also require our lessees, depots and maintenance and repair and repositioning vendors to indemnify us against losses, injuries and accidents, but these indemnifications may be insufficient or inapplicable.

However, no insurance can compensate for all potential losses, and we cannot guarantee that the insurance policies held by us or our lessees, depots or maintenance and repair and repositioning vendors will be adequate or that our insurers will pay a particular claim. Moreover, there may be instances where lessees, depots or maintenance and repair and repositioning vendors do not maintain the requisite amount of insurance. In addition, our lessees are not required to maintain insurance to cover various risks for which they may be responsible while using our chassis, including environmental claims. In addition, our insurance does not cover certain risks, such as the risk of loss of our chassis due to mysterious disappearance. As a result, under certain circumstances, we may be liable for potentially significant losses in the event that our lessees', depots' or maintenance and repair and repositioning vendors' insurance does not, or our insurance does not, cover certain losses.

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claims. In addition, our insurance does not cover certain risks, such as the risk of loss of our chassis due to mysterious disappearance. As a result, under certain circumstances, we may be liable for potentially significant losses in the event that our lessees', depots' or maintenance and repair and repositioning vendors' insurance does not, or our insurance does not, cover certain losses.

The cost of certain insurance policies may become prohibitively expensive for us and for our lessees, depots and maintenance and repair and repositioning vendors, or such insurance policies may not continue to be available to us or them at all. Also, if the cost of certain other policies increases, we may be forced to pay such increases if the policies are of the type that we are required to maintain under the terms of our financing agreements. For example, in the past the premiums on one of our insurance policies increased with regard to accidents involving those chassis for which we serve as IEP. Those premiums also increased to cover us against claims arising from the motor carriers' use of our chassis under the motor carrier model, in part because we only require the motor carriers to maintain $1.0 million of insurance against such risks, instead of the $2.0 million of such coverage we typically require of our shipping line customers. Certain other types of insurance that we have maintained from time to time, such as insurance to cover the cost of recovering our chassis in the event of a default by a lessee, have been particularly susceptible to rate increases, less favorable terms and have even been unavailable in the insurance market at times in the past. In fact, because of an increase in rates for default insurance with less favorable terms, we decided not to renew our default policy when it expired in October 2015. Not carrying such insurance may increase our exposure to defaults by our customers. In addition, for the past several years, credit insurance, which covers our lessee's non-payment of leases that are owed prior to our declaring a default of the lease, has been difficult to obtain in the insurance market for our fleet and we currently do not maintain this type of insurance coverage.

Increases in insurance costs, the inadequacy of our and our lessees', depots' and maintenance and repair and repositioning vendors' current policies and our or their inability to renew these insurance policies could each have a material adverse effect on our business, financial condition and results of operation.

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Unexpected factors affecting self-insurance claims and reserve estimates could adversely affect the Company.

Commencing January 1, 2015, we have been using a combination of insurance and self-insurance to provide for potential liabilities for employee health care benefits. Management estimates the liabilities associated with the risks retained by the Company, in part, by considering historical claims experience, demographic and severity factors and other actuarial assumptions which, by their nature, are subject to a high degree of variability.

Our liability for health care benefits is capped at $~~150~~175,000 per covered person and 125% of our expected claims in the aggregate for all covered persons pursuant to a stop-loss policy of insurance we obtained from Sun Life Assurance of Canada (the "Sun Life Policy"). The cap on aggregate liability is recalculated under the Sun Life Policy each month, based in part on the number of persons then covered under our medical benefits plan. In the event we pay medical benefits in excess of the then current cap on aggregate liability, the maximum benefit payable to us under the Sun Life Policy is $1.0 million. Although we have minimized our exposure on individual claims, for the benefit of cost savings, we have accepted the risk of an unusual amount of independent multiple material claims arising, which could have a significant impact on our results of operations.

We are party to numerous indemnification agreements and, because many of these indemnities do not limit the potential payment, we could be subject to substantial payments under these agreements.

In the ordinary course of business, we execute contracts involving indemnifications standard in the industry and indemnifications specific to a transaction, such as an assignment and assumption agreement. These indemnifications might include claims related to tax matters, governmental regulations, and contractual relationships, among others. Performance under these indemnities would generally be triggered by a breach of terms of the contract or by a third-party claim. One of the principal types of indemnification for which payment is possible is taxes. The other principal type of indemnity we may agree to is one in favor of certain lenders and chassis pool hosts indemnifying them against certain claims relating to the operation of our chassis, although this type of indemnity generally is covered by insurance or an indemnity in our favor from a third party, such as a lessee or a vendor. We regularly evaluate the probability of having to incur material costs associated with these indemnifications and have concluded that none are probable.

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regulations, and contractual relationships, among others. Performance under these indemnities would generally be triggered by a breach of terms of the contract or by a third-party claim. One of the principal types of indemnification for which payment is possible is taxes. The other principal type of indemnity we may agree to is one in favor of certain lenders and chassis pool hosts indemnifying them against certain claims relating to the operation of our chassis, although this type of indemnity generally is covered by insurance or an indemnity in our favor from a third party, such as a lessee or a vendor. We regularly evaluate the probability of having to incur material costs associated with these indemnifications and have concluded that none are probable.

Pursuant to our tax-related indemnifications, the indemnified party is typically protected from certain events that result in a tax treatment different from that originally anticipated. Our liability is typically fixed when a final determination of the indemnified party's tax liability is made. In some cases, a payment under a tax indemnification may be offset in whole or in part by refunds from the applicable governmental taxing authority. We are party to numerous tax indemnifications and many of these indemnities do not limit potential payment; therefore, we are unable to estimate a maximum amount of potential future payments that could result from claims made under these indemnities.

Our reputation and financial results could be harmed in the event of accidents or incidents, or as a result of a mismanagement of our fleet.

We are exposed to liabilities that are unique to the services we provide. Such liabilities may relate to an accident or incident involving one of our chassis and could involve significant potential claims of injured third parties. Our lessees, depots and maintenance and repair and repositioning vendors are required to indemnify us against most such claims and to maintain a certain amount of insurance to cover their indemnity obligations. We also maintain insurance to cover these claims. However, the indemnifications of our lessees, depots or maintenance and repair and repositioning vendors may be insufficient or inapplicable or the amount of our or their insurance coverage may not be adequate to cover potential claims or or liabilities and we may be forced to bear substantial costs due to one or more accidents. Substantial claims resulting from an accident in excess of our related insurance coverage would harm our financial condition and operating results.

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accidents. Substantial claims resulting from an accident in excess of our related insurance coverage would harm our financial condition and operating results.

Our customers require demanding specifications for product performance and reliability. Any accident or incident involving our chassis, even if we are fully insured or not held liable, could negatively affect our reputation among customers and the public, thereby making it more difficult for us to compete effectively, and could significantly affect the cost and availability of insurance in the future. In addition to potential cost increases, customers may be dissatisfied by any failure that interrupts our ability to provide chassis or the ability to use our chassis. Sustained or repeated chassis failures reduce the attractiveness of our business significantly in comparison to our competitors. The resulting damage to our customer relationships, and industry reputation would negatively affect our results of operations.

In addition, most of the contracts with our pool customers only require us to provide chassis on an "as available" basis. However, because our chassis are a critical component in our customers' business, if we are unable to supply our pool customers with chassis in the quantity, location and time necessary for their needs, our business could be adversely affected and our reputation could suffer. Our ability to supply our customers with chassis could be constrained by factors beyond our control, including the lack of domestic chassis surplus and the chassis remanufacturing lead time. Furthermore, certain of our customers are requiring us to be accountable for failures to meet their chassis requirements and, in an increasing number of cases, pay them a penalty.

Recalls and other investigations may have a material adverse effect on our business.

We rely on third parties to manufacture and remanufacture our chassis and there is a risk that at any given time certain chassis may be ~~subject~~ subject to recall. Although in the past ~~several~~ten years we have received only two notices of recall related to a relatively small number of our chassis, a recall of a significant number of our chassis could have a material adverse effect on our business.

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Manufacturers or remanufacturers of our equipment may be unwilling or unable to honor manufacturer warranties covering defects in our equipment.

We obtain certain warranties from the manufacturers and remanufacturers of our equipment. When defects in the chassis occur, we work with the manufacturers or remanufacturers to identify and rectify the problem. However, there is no assurance that manufacturers or remanufacturers will be willing or able to honor warranty obligations. If defects are discovered in chassis that are not covered by manufacturer or remanufacturer warranties, we could be required to expend significant amounts of money to repair the chassis and/or the useful life of the chassis could be shortened and the value of the chassis reduced, all of which could adversely affect our results of operations.

Federal roadability rules and regulations for intermodal equipment providers may impose additional obligations and costs on us.

The FMCSA has implemented rules and regulations for entities offering intermodal chassis to motor carriers for transportation of ~~intermodal~~ intermodal containers in interstate commerce. We refer to these regulations, collectively, as the "Roadability Regulations." The Roadability Regulations require each IEP to register and file certain reports with the FMCSA, display a USDOT number on each chassis offered for interstate commerce or maintain that number in a national equipment database, establish a systematic chassis inspection and ~~maintenance~~ maintenance and repair program, maintain documentation with regard to this program and provide means for drivers and motor carriers to report on chassis deficiencies and defects. The Roadability Regulations began with partial compliance requirements in mid-2010 and have been fully implemented since December 17, 2010. As part of the overall program, FMCSA has stated it intends to implement additional roadside inspection requirements for both IEPs and motor carriers operating intermodal equipment, including chassis. The Roadability Regulations establish fines and other sanctions for an IEP whose chassis fail to comply with the applicable federal safety criteria.

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operating intermodal equipment, including chassis. The Roadability Regulations establish fines and other sanctions for an IEP whose chassis fail to comply with the applicable federal safety criteria.

Under the Roadability Regulations, we are considered to be the IEP for our chassis in our pools and for those managed chassis where we contractually agree to act as the IEP. Our lessees are the IEPs for the chassis that are under term and direct finance leases. The number of chassis for which we serve as IEP has increased over the past several years and may continue to increase in the future as we add chassis to our neutral pools and contractually agree to act as IEP over chassis we manage. Since the IEP is responsible for, among other things, establishing the systematic chassis inspection and maintenance and repair program, to the extent the number of chassis for which we serve as the IEP does in fact increase, so may our risk of fines and sanctions. In addition, our status as IEP may increase our exposure to third-party claims.

We have established administrative and operating controls which we believe meet the requirements of the Roadability Regulations applicable to us as an IEP. However, in connection with ~~two~~various audits at ~~two of~~ our chassis pools by the FMCSA, ~~the~~we ~~FMCSA~~have ~~put~~received ~~us on notice of certain~~ violations, offor ~~the~~example, ~~Roadability~~concerning ~~Regulations. Only one of these violations—~~the ~~company~~Company's ~~failure~~use ~~to inspect intermodal equipment in violation~~ of ~~49 C.F.R. 369.17(~~a~~)—was~~ ~~identified~~commercial asmotor ~~"critical"~~vehicle bythat ~~the~~was ~~FMCSA.~~not Noperiodically ~~fines,~~inspected ~~penalties or other sanctions have been assessed against us~~ as ~~a result~~required ofunder ~~this~~the ~~violation~~Roadability Regulations, and ~~none~~may ~~are~~receive ~~expected~~violations atin ~~this~~the ~~time~~future. WeWhile we believe that we have appropriately addressed ~~this~~all ~~and the other~~ violations assessed by the FMCSA in its audits ~~(none of the other violations were identified by the FMCSA as "acute"~~, "critical" or "serious" within the meaning of the Roadability Regulations) and to date, have received no further communication from the FMCSA in connection with either audit. Though no fines or sanctions have been imposed in connection with these audits, we are unable to predict whether future enforcement efforts by the FMCSA will result in the imposition of any significant violations, fines or sanctions, which sanctions could include prohibiting us from leasing chassis from one or more of our chassis pools.

Environmental liability may adversely affect our business and financial situation.

We are subject to federal, state and local laws and regulations relating to the protection of the environment. We could incur substantial costs, including cleanup costs, fines and third-party claims for property damage and personal injury, as a result of violations of or liabilities under environmental laws and regulations in connection with both our current, historical or future chassis leasing operations as well as our current and future service center operations. Moreover, environmental laws are subject to frequent change and have tended to become more stringent over time. As a result, additional environmental laws and regulations may be adopted which could limit our ability to conduct business or increase the cost of our doing business, which may have a materially negative impact on our business, results of operation and financial condition. While we maintain pollution insurance with respect to our chassis leasing operations, and typically require lessees to indemnify us against certain losses, such insurance and indemnities may not cover, or be sufficient to protect us against, losses arising from environmental damage. Similarly, while we obtain and maintain pollution insurance that covers certain types of environmental liabilities with respect to our service center operations and typically require the landlords from whom we lease these properties to indemnify us, at a minimum, against environmental liabilities that existed prior to our occupying these sites, such insurance and indemnities may not cover, or be sufficient to protect us against, all losses from environmental damage.

We rely on our information technology systems to conduct our business. If these systems fail to adequately function, or if we experience an interruption in their operation, our business and financial results could be adversely affected. 36

The efficient operation of our business is highly dependent on equipment tracking and billing systems. We rely on such systems to track transactions, such as chassis pick-ups and drop-offs, repairs,

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~~and~~frequent tochange ~~bill~~and ~~our~~have ~~customers~~tended ~~for~~to ~~the~~become ~~use~~more ofstringent ~~and~~over ~~damage~~time. toAs ~~our~~a ~~equipment.~~result, ~~For~~additional ~~example,~~environmental ~~our~~laws ~~proprietary~~and ~~PoolStat®~~regulations ~~chassis~~may ~~management~~be ~~software~~adopted iswhich ~~critical~~could tolimit our ability to ~~effectively~~conduct ~~manage~~business or ~~chassis~~increase onthe ~~behalf~~cost of our ~~customers.~~doing ~~The~~business, ~~information~~which ~~our~~may ~~systems~~have ~~provide~~a ~~also~~materially ~~assists~~negative usimpact inon our ~~day-to-day~~ business, ~~decisions~~results soof ~~that~~operation and financial condition. While we ~~may~~maintain ~~efficiently~~pollution ~~manage~~insurance with respect to our ~~lease~~chassis ~~portfolio~~leasing operations, and ~~improve~~typically ~~customer service.~~require ~~While~~lessees weto ~~maintain~~indemnify ~~back-up~~us ~~systems~~against certain losses, ~~the~~such ~~failure~~insurance ofand ~~our~~indemnities ~~information~~may ~~technology~~not ~~systems~~cover, or be sufficient to ~~perform~~protect asus weagainst, ~~anticipate~~losses arising ~~could~~from ~~disrupt~~environmental ~~our~~damage. ~~business~~Similarly, while we obtain and ~~results~~maintain ofpollution ~~operation~~insurance ~~and~~that ~~cause~~covers ~~our relationships~~certain types of environmental liabilities with respect to our ~~customers~~service tocenter ~~suffer.~~operations Inand typically ~~addition,~~require ~~while~~the welandlords ~~have~~from ~~taken~~whom ~~precautionary~~we ~~measures~~lease ~~and~~these ~~have~~properties ~~implemented~~to ~~contingency~~indemnify ~~plans~~us, ~~our~~at ~~systems~~a ~~are~~minimum, ~~vulnerable~~against toenvironmental ~~damage~~liabilities orthat ~~interruption~~existed ~~from circumstances~~prior ~~beyond~~to our ~~control,~~occupying ~~including~~these ~~fire~~sites, ~~natural~~such ~~disasters,~~insurance ~~power~~and indemnities ~~loss~~may ~~and~~not ~~computer~~cover, ~~systems~~or ~~failures~~be ~~and~~sufficient ~~viruses.~~to ~~Any~~protect ~~such~~us ~~interruption~~against, ~~could~~all ~~negatively~~losses ~~affect~~from ~~our~~environmental ~~business~~damage.

We ~~are in the process of implementing a new ERP system and other new applications scheduled to be in use by the first or second quarter of 2017. This system is designed to improve the~~ ~~efficiency~~ We ofrely ~~our~~on ~~supply chain and financial transaction processes, accurately maintain~~ our ~~books~~information ~~and~~technology ~~records~~systems ~~and provide important information~~ to conduct our business ~~team~~. WeIf ~~may~~these ~~experience~~systems ~~periodic~~fail ~~or prolonged disruption of our IT infrastructure arising out of the conversion~~ to ~~the new ERP system~~adequately function, ~~general use of such system, periodic upgrades and updates~~ or ~~external~~if ~~factors outside of our control. Any such disruption could adversely affect our ability to complete essential business processes. If~~ we ~~encounter~~experience ~~unforeseen~~an ~~problems~~interruption ~~with~~in ~~regard~~their ~~to our new ERP system~~operation, our business, ~~operations~~ and financial ~~condition~~results could be adversely affected.

The efficient operation of our business is highly dependent on equipment tracking and billing systems. We rely on such systems to track transactions, such as chassis pick-ups and drop-offs, repairs, and to bill our customers for the use of and damage to our equipment. For example, our proprietary PoolStat® chassis management software is critical to our ability to effectively manage chassis on behalf of our customers. The information our systems provide also assists us in our day-to-day business decisions so that we may efficiently manage our lease portfolio and improve customer service. While we maintain back-up systems, the failure of our IT systems to perform as we anticipate or to prevent breaches in our systems by cyber security threats could disrupt our business and results of operation and cause our relationships with our customers to suffer. In addition, while we have taken precautionary measures and have implemented contingency plans, our systems are vulnerable to damage or interruption from circumstances beyond our control, including fire, natural disasters, power loss and computer systems failures and viruses. Any such interruption could negatively affect our business.

We are in the process of implementing a new ERP system and other new applications scheduled to be in use by the first or second quarter of 2018. This system is designed to improve the efficiency of our supply chain and financial transaction processes, accurately maintain our books and records and provide important information to our business team. We may experience periodic or prolonged disruption of our IT infrastructure arising out of the conversion to the new ERP system, general use of such system, periodic upgrades and updates or external factors outside of our control. Any such disruption could adversely affect our ability to complete essential business processes. If we encounter unforeseen problems with regard to our new ERP system, our business, operations and financial condition could be adversely affected.

Our business may be adversely affected if we are unable to protect our intellectual property rights.

Protecting our intellectual property rights is an important element to our continued success and our ability to maintain our competitive position. In addition to existing trademark, trade secret and copyright law, we protect our proprietary rights through confidentiality agreements and technical measures. Misappropriation of our intellectual property could have an adverse effect on our competitive position. In addition, we do not have any patents on our technology, including our proprietary PoolStat® chassis management software. If third-parties obtain access to PoolStat®, we cannot be certain that our software will not become publicly available. Therefore, we may have to engage in litigation in the future to enforce or protect our intellectual property rights or to defend against claims of infringement, misappropriation or other violations of third-party intellectual property rights. We may incur substantial costs and the diversion of management's time and attention as a result and an adverse decision could have a negative impact on our business.

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In addition to the United States, we have also registered certain of our trademarks in Canada and Mexico. However, even in those jurisdictions, competitors may adopt similar trademarks to ours, register domain names that mimic ours or purchase keywords that are confusingly similar to our brand names as terms in Internet search engine advertising programs. These actions by our competitors could impede our ability to build our brand identity and lead to confusion among potential customers of our services.

As an "emerging growth company" under the JOBS Act, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements.

As an "emerging growth company" under the JOBS Act, we are permitted to, and do, rely on exemptions from certain disclosure requirements. We are an "emerging growth company" until the earliest of: (i) the last day of the fiscal year during which we had total annual gross revenues of $1 billion or more, (ii) the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement, (iii) the date on which we have, during the previous 3-year period, issued more than $1 billion in non-convertible debt or (iv) the date on which we are deemed a "large accelerated filer" as defined under the federal securities laws. For so long as we remain an "emerging growth company", we will not be required to: comply with any requirement that may be adopted by the Public Company Accounting Oversight Board ("PCAOB") regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the financial statements (auditor discussion and analysis); and submit certain executive compensation matters to member advisory votes, such as "say on pay" and "say on pay frequency". Although we intend to rely on the exemptions provided in the JOBS Act, the exact implications of the JOBS Act for us are still subject to interpretations and guidance by the SEC and other regulatory agencies. In addition, as our business grows, we may no longer satisfy the conditions of an "emerging growth company".

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with any requirement that may be adopted by the Public Company Accounting Oversight Board ("PCAOB") regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the financial statements (auditor discussion and analysis); and submit certain executive compensation matters to member advisory votes, such as "say on pay" and "say on pay frequency". Although we intend to rely on the exemptions provided in the JOBS Act, the exact implications of the JOBS Act for us are still subject to interpretations and guidance by the SEC and other regulatory agencies. In addition, as our business grows, we may no longer satisfy the conditions of an "emerging growth company".

We may enter into transactions with members of our management, our members or shareholders and their respective affiliates that may involve inherent, potential or perceived conflicts of interest.

We may, in the future, enter into transactions with members of management, our members or shareholders and their respective affiliates. Some of these relationships and transactions may involve inherent, potential or perceived conflicts of interest. In certain instances, the terms of these transactions may be more or less favorable to us than the terms that we would have obtained through arm's length negotiations. See Note 15 "Related Party Transactions" to our Consolidated Financial Statements. The interests of our management, members or shareholders and their respective affiliates may not always coincide with our interests. As a result, risks in transactions may be taken that adversely affect us, but may enhance the investment of the members of management, our members or shareholders and their respective affiliates.

In addition, our parent, Seacastle directly, and the investment funds managed by an affiliate of Fortress, own substantially all of our membership interests, and are therefore able to control our business direction and policies, including acquisitions and consolidation with third parties and the sale of all or substantially all of our assets. If Seacastle or Fortress or any of their officers, directors, employees or affiliates acquire knowledge of a potential transaction that could be a corporate opportunity, they have no duty to offer such corporate opportunity to us, our stockholders or our affiliates. Consequently, circumstances may arise in which the interests of Seacastle or Fortress could conflict with our interests and Seacastle, Fortress or their affiliates may pursue transactions that enhance their equity, even though the transaction may not positively affect our business.

The international nature of the industry exposes us to numerous risks.

While we lease the majority of our chassis within the United States, we do lease some of our chassis to customers in Canada and Mexico. In In addition, some of our major customers are headquartered outside of the United States. As a result, our ability to enforce lessees' obligations under our leases and other arrangements for use of our chassis may at times be subject to applicable law in the jurisdictions in which enforcement is sought and it is not possible to predict, with any degree of certainty, the jurisdictions in which enforcement proceedings may be commenced. For example, repossession of chassis from defaulting lessees may be difficult and more expensive, especially in a jurisdiction such as Mexico that does not confer the level of creditors' rights as in the United States and in jurisdictions where recovery of equipment from the defaulting lessee is more cumbersome. As a result, the relative success and expedience of enforcement proceedings with respect to our chassis in various jurisdictions also cannot be predicted.

~~We are also subject to risks inherent in conducting business across national boundaries, any one of which could adversely impact our business. These risks include:~~38

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headquartered outside of the United States. As a result, our ability to enforce lessees' obligations under our leases and other arrangements for use of our chassis may at times be subject to applicable law in the jurisdictions in which enforcement is sought and it is not possible to predict, with any degree of certainty, the jurisdictions in which enforcement proceedings may be commenced. For example, repossession of chassis from defaulting lessees may be difficult and more expensive, especially in a jurisdiction such as Mexico that does not confer the level of creditors' rights as in the United States and in jurisdictions where recovery of equipment from the defaulting lessee is more cumbersome. As a result, the relative success and expedience of enforcement proceedings with respect to our chassis in various jurisdictions also cannot be predicted.

We are also subject to risks inherent in conducting business across national boundaries, any one of which could adversely impact our business. These risks include:

•: regional or local economic downturns;
•: changes in governmental policy or regulation;
•: restrictions on the transfer of funds into or out of the country;
•: import and export duties and quotas;
•: domestic and foreign customs and tariffs;
•: government instability;
•: nationalization of foreign assets;
•: government protectionism;
•: compliance with export controls;
•: diminished legal rights and remedies in foreign courts;
•: compliance with import procedures and controls, including those of the U.S. Department of Homeland Security;
•: potentially negative consequences from changes in tax laws;
•: higher interest rates or unfavorable foreign currency exchange rates;
•: requirements relating to withholding taxes on remittances and other payments by subsidiaries;
•: labor or other disruptions at key ports or railroad ramps;
•: difficulty in staffing and managing widespread operations;
•: restrictions on our ability to own or operate subsidiaries, make investments or acquire new businesses in these jurisdictions; and
•: compliance with applicable anti-corruption laws.

Any one of these factors could impair our current or future international operations and, as a result, harm our overall business. Many of these factors also affect our customers' business. Should one or more of these factors have an adverse impact on our customers, our business could also be harmed.

Our earnings may decrease because of increases in prevailing interest rates.

Our profitability is affected by increases in prevailing interest rates. The following are the material risks we face related to increases in prevailing interest rates:

•: an increase in customer delinquency and default, resulting in an increase in operating expenses;

~~We intend to pursue acquisition opportunities, which may subject us to considerable business and financial risk.~~ 39

As part of our growth plan, we intend to undertake strategic acquisitions and/or joint ventures (including joint ventures established with other chassis providers to manage the chassis contributed by us and them to various Co-op pools). In addition, we believe there are significant opportunities to grow our business through acquisitions of additional chassis and we explore potential growth in the ordinary course of our business, including purchasing marine chassis fleets from shipping lines and investing in new and remanufactured chassis to support organic growth. The acquisitions of additional chassis can

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•: an increase in the costs of new leasing arrangements, which could cause some customers to lease fewer chassis or demand shorter lease terms;
•: an adverse effect on our long-term lease profits;
•: an increase in the cost of incurring debt, including under our ABL Facility and capital leases, which could potentially limit growth and acquisitions; and
•: reduced demand for our products and services, resulting in lower sales volumes, lower prices, lower lease utilization rates and decreased profits.

~~vary~~ ~~in number and could exceed actual demand at the time we take delivery or be larger than our historical increase in chassis available for lease. Our ability to realize the anticipated benefits of~~ ~~potential~~ We ~~future~~may ~~acquisitions~~pursue ofacquisition ~~chassis for lease will depend~~opportunities, inwhich ~~part,~~could onsubject ~~our~~us ~~ability~~ to ~~integrate~~considerable ~~such chassis with our current~~ business ~~model. The process of acquiring or integrating additional chassis may disrupt our business~~ and ~~may~~financial ~~not result in the full benefits expected~~risk.

As part of our growth plan, we may undertake strategic acquisitions and/or joint ventures (which may include joint ventures established with other chassis providers to manage the chassis contributed by us and them to various Co-op pools). In addition, we believe there are significant opportunities to grow our business through acquisitions of additional chassis and we explore potential growth in the ordinary course of our business, including purchasing marine chassis fleets from shipping lines and investing in new and remanufactured chassis to support organic growth. The acquisitions of additional chassis can vary in number and could exceed actual demand at the time we take delivery or be larger than our historical increase in chassis available for lease. Our ability to realize the anticipated benefits of potential future acquisitions of chassis for lease will depend, in part, on our ability to integrate such chassis with our current business model. The process of acquiring or integrating additional chassis may disrupt our business and may not result in the full benefits expected.

Reviewing joint ventures or potential acquisition opportunities for additional chassis or businesses may require a meaningful part of management's time and require us to incur legal and other fees as part of our review. Moreover, we may not be successful in identifying joint venture or acquisition opportunities, assessing the value, strengths and weaknesses of these opportunities and consummating acquisitions on acceptable terms. In addition, tightening of the credit markets may limit our ability to obtain debt financing for acquisitions, and we may be unable to obtain financing by issuing additional debt or equity on terms acceptable to us. If our performance deteriorates prior to engaging in acquisitions, it may limit our ability to obtain debt financings for acquisitions. These or other unanticipated issues may arise in the implementation of our business strategies, and could impair our expansion plan.

Furthermore, any joint ventures or acquisitions may expose us to risks associated with the new assets or the particular business we are acquiring, including:

•: incurring additional indebtedness and assuming liabilities;
•: incurring significant additional capital expenditures, transaction and operating expenses and non-recurring acquisition related charges;
•: experiencing an adverse impact on our earnings from the amortization or write-off of acquired goodwill and other intangible assets;
•: acquiring businesses or entering new markets with which we are not familiar;
•: mismanaging utilization rates;
•: increased risks of defaults through acquiring customers who bear a greater risk of default than our current customers;
•: exposure to regulatory risks, including potential antitrust risks;
•: increasing the scope, geographic diversity and complexity of our operations; and
•: failing to retain key personnel, suppliers and customers of the acquired businesses.

We may not be able to successfully manage additional chassis or acquired businesses or increase our cash flows from these operations. If we are unable to successfully implement our joint venture and acquisition strategy or address the risks associated with joint ventures and acquisitions, or if we encounter unforeseen expenses, difficulties, complications or delays frequently encountered in connection with the integration of acquired entities and the expansion of operations, our growth and ability to compete may be impaired, we may fail to achieve acquisition synergies and we may be required to focus resources on integration of operations rather than on other profitable areas. We anticipate that we may finance acquisitions through cash provided by operating activities, borrowings under our credit facilities and other indebtedness, or a combination of both, all of which would reduce our cash available for other purposes, including the repayment of indebtedness. 40

Our hedging strategies may not be successful in mitigating our risks associated with interest rates and expose us to counterparty risk.

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~~financial~~ We ~~instruments~~may ~~that~~not webe ~~select~~able ~~may~~to ~~not~~successfully ~~have~~manage ~~the~~additional ~~effect~~chassis ofor ~~reducing~~acquired businesses or increase our ~~interest~~cash ~~rate~~flows ~~risks~~from these operations. InIf ~~addition,~~we ~~the~~are ~~nature~~unable ~~and~~to ~~timing~~successfully ofimplement ~~hedging~~our ~~transactions~~joint venture ~~may~~and ~~influence~~acquisition strategy or address the ~~effectiveness~~risks ofassociated ~~these strategies.~~with ~~Poorly~~joint ~~designed~~ventures ~~strategies~~and acquisitions, ~~improperly~~or ~~executed~~if ~~and~~we ~~documented~~encounter ~~transactions~~unforeseen expenses, difficulties, complications or ~~inaccurate~~delays ~~assumptions~~frequently encountered ~~could~~in ~~actually~~connection ~~increase~~with ~~our~~the ~~risks~~integration of acquired entities and ~~losses.~~the Inexpansion ~~addition~~of operations, ~~hedging~~our ~~strategies~~growth ~~involve transaction~~ and ~~other~~ability ~~costs.~~to ~~Our~~compete ~~hedging~~may ~~strategies~~be ~~and~~impaired, ~~the~~we ~~derivatives~~may ~~that~~fail weto ~~use~~achieve ~~may~~acquisition ~~not~~synergies and we may be ~~able~~required to ~~adequately~~focus ~~offset~~resources ~~the~~on ~~risks~~integration of ~~interest~~operations ~~rate~~rather ~~volatility~~than ~~and~~on ~~our~~other ~~hedging~~profitable ~~transactions~~areas. We anticipate that we may ~~result in~~finance oracquisitions ~~magnify~~through ~~losses.~~cash ~~Furthermore,~~provided ~~interest~~by ~~rate~~operating ~~derivatives~~activities, borrowings ~~may~~under ~~not~~our becredit ~~available~~facilities onand ~~favorable~~other ~~terms~~indebtedness, or ata combination of both, all of which would reduce our cash available for other purposes, ~~particularly~~including ~~during~~the ~~economic~~repayment ~~downturns~~of indebtedness.

~~Interest~~ ~~rate derivatives involve counterparty credit risk. As of December 31, 2015, we had one interest rate derivative. This derivative is held with a counter party with a~~ ~~credit rating of Baa1 by Moody's. In February, 2016, we entered into three additional interest rate derivatives, two with our existing counterparty and one with a new counterparty rated A3 by Moody's.~~ ~~Although we do not anticipate that this counterparty will fail to meet its obligations, if this counterparty cannot meet its obligations, we will bear the resulting losses. Agency ratings are subject~~ ~~to change, and there can be no assurance that a ratings agency will continue to rate the counterparty, and/or maintain their current rating. A security rating is not a recommendation to buy, sell or~~ ~~hold~~ Our ~~securities,~~hedging itstrategies may benot ~~subject to revision or withdrawal at any time by the rating agency, and each rating should~~ be ~~evaluated~~successful ~~independently of any other rating. We cannot predict the effect that a change~~ in ~~the~~mitigating ~~ratings~~our ofrisks ~~the~~associated ~~counterparty~~with ~~will~~interest ~~have~~rates onand ~~its~~expose ~~ability~~us to ~~meet~~counter ~~its~~party ~~obligations~~risk. ~~Any of the foregoing risks could adversely affect our business, financial condition and results of operations.~~

From time to time, we have used various derivative financial instruments to provide a level of protection against interest rate risks, but no hedging strategy can protect us completely. The derivative financial instruments that we select may not have the effect of reducing our interest rate risks. In addition, the nature and timing of hedging transactions may influence the effectiveness of these strategies. Poorly designed strategies, improperly executed and documented transactions or inaccurate assumptions could actually increase our risks and losses. In addition, hedging strategies involve transaction and other costs. Our hedging strategies and the derivatives that we use may not be able to adequately offset the risks of interest rate volatility and our hedging transactions may result in or magnify losses. Furthermore, interest rate derivatives may not be available on favorable terms or at all, particularly during economic downturns.

Interest rate derivatives involve counterparty credit risk. As of December 31, 2016, we had four interest rate derivatives. These derivatives are held with counterparties with a credit rating of Baa2 and A3 by Moody's. Although we do not anticipate that these counterparties will fail to meet their obligations, if these counterparties cannot meet their obligations, we will bear the resulting losses. Agency ratings are subject to change, and there can be no assurance that a ratings agency will continue to rate these counterparties, and/or maintain their current rating. A security rating is not a recommendation to buy, sell or hold securities, it may be subject to revision or withdrawal at any time by the rating agency, and each rating should be evaluated independently of any other rating. We cannot predict the effect that a change in the ratings of these counterparties will have on their ability to meet their obligations. Any of the foregoing risks could adversely affect our business, financial condition and results of operations.

A new standard for lease accounting has been issued, but we are unable to predict the impact of such standard at this time.

On February 25, 2016, the Financial Accounting Standards Board ("FASB") issued its final lease standard Leases (Topic 842) ("ASU 2016-02"). ASU 2016-02 will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.

~~Currently,~~Management ~~management~~ is ~~unable~~currently toassessing ~~assess~~ the impact the adoption of the new accounting standard will have on our financial statements. Although we believe the presentation of our ~~financial~~ financial statements, and those of our lessees, could change, we do not believe the new accounting standard will change the fundamental economic reasons for which our customers lease chassis. However, since the changes to lease accounting under the new accounting standard no longer permit "off-balance sheet" presentation by lessees under an operating lease, there will be little difference between ~~the~~ the accounting treatment of asset ownership versus asset leasing. As a result, lessees may elect to purchase chassis instead of leasing them, which may have an adverse effect on our business.

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Adverse changes in U.S. tax rules may adversely affect us.

While we record a tax provision in our financial statements, we currently do not pay any meaningful income taxes primarily due to the benefit we receive from accelerated tax depreciation on our chassis investments. A change in the rules governing the tax depreciation of our chassis, in particular, a change that increases the period over which we can depreciate our chassis for tax purposes, could reduce or eliminate this tax benefit and significantly increase our cash tax payments.

In addition, even under current tax rules, we need to make substantial, ongoing investments in new chassis in order to continue to benefit from the tax deferral generated by accelerated tax depreciation. If our investment level slows due to a decrease in the growth rate of world trade, decisions by our customers to buy more of their chassis, a loss of market share to one or more of our peers, or for any other reason, the favorable tax treatment from accelerated tax depreciation would diminish, and we could face significantly increased cash tax payments.

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Also, our net deferred tax liability balance includes a deferred tax asset for U.S. federal and various state taxes resulting from net operating loss carry forwards ("NOLs"). A reduction to our future earnings, which will lower taxable income, may require us to record an additional charge against earnings in the form of a valuation allowance, if it is determined that it is more-likely-than-not that some or all of the loss carry forwards will not be realized.

Terrorist attacks, war, uprisings or hostilities could adversely affect us.

Potential acts of terrorism, war, uprisings or hostilities may affect the ports and depots at which we and our customers operate, as well as our other facilities or those of our customers and suppliers. In addition, any such incident or similar act of violence could lead to a disruption to the global network of ports and the global flow of goods, upon which our business is inherently reliant. To the extent any such event were to result directly or indirectly in a reduction in the level of international trade and reduced demand for transportation equipment, our business could be adversely affected. The consequences of any terrorist attacks, wars, uprisings or hostilities are unpredictable and we may not be able to foresee events that could have an adverse effect on our operations or the value of our securities.

ITEM 1B. UNRESOLVED STAFF COMMENTS

NONE

ITEM 2. PROPERTIES

At December 31, ~~2015~~2016, we are headquartered in an office building in Princeton, New Jersey, where we lease 82,283 square feet of ~~office~~ office space and where we employ ~~378~~351 people. Additionally, we lease 2426 other small offices in 1314 states in the United States where the remainder of our staff is located.

ITEM 3. LEGAL PROCEEDINGS

We have been, are currently, and may from time to time be, involved in litigation and claims incidental to the conduct of our business comparable to other companies in the intermodal asset leasing industry. Our industry is also subject to scrutiny by government regulators, which could result in enforcement proceedings or litigation related to regulatory compliance matters. We maintain insurance policies in amounts and with the coverage and deductibles we believe are adequate, based on the nature and risks of our business experience and industry standards. We believe that the cost of defending any pending litigation or challenging any pending or future regulatory compliance matter will not have a material adverse effect on our business.

ITEM 4. MINE SAFETY DISCLOSURES

NONE

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PART II

ITEM 5. MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

N/A

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ITEM 6. SELECTED FINANCIAL DATA

The following tables summarize consolidated financial information of TRAC and its consolidated subsidiaries. TRAC has no operations of its own and is dependent upon the cash flows of its subsidiaries to meet its obligations under the Notes. TRAC is a Delaware limited liability company that was formed as of July 13, 2012. We conduct all of our business through Interpool and its consolidated subsidiaries. You should read these tables along with "Management's discussion and analysis of financial condition and results of operations," "Business" and our historical consolidated financial statements and the related notes included elsewhere in this report.

The selected historical consolidated statement of operations data and historical consolidated statement of cash flows data presented below have been derived from our audited consolidated financial statements at the dates and for the periods indicated.

	Year ended December 31,
(dollars in thousands)	~~2015~~2016			~~2014~~2015			~~2013~~2014			~~2012~~2013			~~2011~~2012
Consolidated Statement of Operations Data:
Total revenues	$	~~691~~669,~~424~~203		$	~~626~~691,~~988~~424		$	~~515~~626,~~244~~988		$	~~414~~515,~~593~~244		$	~~339~~414,~~344~~593
Direct operating expenses		~~377~~373,~~715~~966			~~333~~377,~~135~~715			~~289~~333,~~767~~135			~~214~~289,~~125~~767			~~172~~214,~~075~~125
Selling, general and administrative expenses		9198,~~279~~023			8491,~~346~~279			5884,~~031~~346			4658,~~038~~031			4046,~~942~~038
Depreciation expense		7274,~~128~~414			72,~~114~~128			7172,~~791~~114			6671,~~052~~791			6466,~~391~~052
(Recovery) provision for doubtful accounts		(258	)		14,007			11,369			4,137			3,954
Provision (recovery) for doubtful accounts		7,812			(258	)		14,007			11,369			4,137
Impairment of leasing equipment		713,~~277~~917			57,~~855~~277			5,~~857~~855			65,~~506~~857			16,~~544~~506
Early retirement of leasing equipment		—			~~37,766~~—			—37,766			—			—
Loss on modification and extinguishment of debt and capital lease obligations		19,852			315			904			8,850			733
Restructuring expense		1,806			—			—			—			—
Interest expense		80,246			86,837			91,085			75,102			65,835
Loss on modification and extinguishment of debt and capital lease obligations		7,486			19,852			315			904			8,850
Interest income		(19	)		(61	)		(287	)		(143	)		(633	)
Interest expense		62,777			80,246			86,837			91,085			75,102
Other income, net(1)		(1,394	)		(925	)		(2,074	)		(809	)		(1,535	)
Interest income		(109	)		(19	)		(61	)		(287	)		(143	)
Other income, net(1)		(1,607	)		(1,394	)		(925	)		(2,074	)		(809	)

Total expenses		~~646~~638,~~826~~485			~~633~~646,~~389~~826			~~526~~633,~~443~~389			~~419~~526,~~858~~443			~~347~~419,~~306~~858

Income (loss) before provision (benefit) for income taxes		4430,~~598~~718			(644,~~401~~598	)		(116,~~199~~401	)		(511,~~265~~199	)		(75,~~962~~265	)
Provision (benefit) for income taxes(2)		1710,~~880~~793			(317,~~445~~880	)		18(3,~~154~~445	)		(218,~~175~~154	)		(42,~~054~~175	)

Net income (loss)	$	2619,~~718~~925		$	(226,~~956~~718	)	$	(292,~~353~~956	)	$	(329,~~090~~353	)	$	(3,~~908~~090	)

	As of December 31,
(dollars in thousands)	2015		2014		2013		2012		2011
Consolidated Balance Sheet Data:
Cash and cash equivalents	$	3,161	$	4,256	$	11,843	$	26,556	$	29,005
Accounts receivable, net of allowance		110,662		135,076		113,138		80,620		57,647
Net investment in direct finance leases		12,797		16,215		25,026		40,729		54,776
Leasing equipment, net of accumulated depreciation		1,435,978		1,436,909		1,394,088		1,325,383		1,292,660
Total assets		1,847,496		1,864,762		1,816,577		1,739,117		1,702,621
Deferred income taxes, net		127,580		102,467		99,331		73,569		76,112
Total debt and capital lease obligations		1,080,679		1,164,222		1,164,137		1,108,397		976,643
Total liabilities		1,278,842		1,334,364		1,292,919		1,200,210		1,161,978
Total member's interest		568,654		530,398		523,658		538,907		540,643

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	As of December 31,

(dollars in thousands)	2016		2015		2014		2013		2012
Consolidated Balance Sheet Data:
Cash and cash equivalents	$	15,620	$	3,161	$	4,256	$	11,843	$	26,556
Accounts receivable, net of allowance		96,898		110,662		135,076		113,138		80,620
Net investment in direct finance leases		11,306		12,797		16,215		25,026		40,729
Leasing equipment, net of accumulated depreciation		1,408,370		1,435,978		1,436,909		1,394,088		1,325,383
Total assets		1,845,851		1,847,496		1,864,762		1,816,577		1,739,117
Deferred income taxes, net		147,765		127,580		102,467		99,331		73,569
Total debt and capital lease obligations		1,097,401		1,080,679		1,164,222		1,164,137		1,108,397
Total liabilities		1,294,552		1,278,842		1,334,364		1,292,919		1,200,210
Total member's interest		549,223		568,654		530,398		523,658		538,907

	Year ended December 31,

(dollars in thousands)	2016		2015		2014		2013		2012
Consolidated Statement of Cash Flows Data:
Cash flows provided by (used in) operating activities	$	151,052	$	181,335	$	138,549	$	66,756	$	(8,271	)
Capital expenditures gross		97,788		92,277		154,375		145,338		103,577

	Year ended December 31,

	2016			2015			2014			2013			2012
Selected Fleet Data:
Active fleet(3)		264,489			278,093			276,038			276,516			269,388
Operating Utilization(4)		91.9	%		94.5	%		95.4	%		92.3	%		92.1	%

(1): Primarily represents (gain) loss from sale of equipment.
(2): 2013 includes non-cash tax expense of $22,105 related to a $56,120 gain recognized solely for tax purposes related to a distribution of stock in a related company. See Note 10 to our Consolidated Financial Statements.
(3): Includes equipment on hire and equipment available for hire.
(4): Operating Utilization is calculated by dividing the On-Hire fleet by the Active Fleet.

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	Year ended December 31,
(dollars in thousands)	2015		2014		2013		2012			2011
Consolidated Statement of Cash Flows Data:
Cash flows provided by (used in) operating activities	$	181,335	$	138,549	$	66,756	$	(8,271	)	$	32,532
Capital expenditures gross(3)		92,277		154,375		145,338		103,577			108,226

	Year ended December 31,
	2015			2014			2013			2012			2011
Selected Fleet Data:
Active fleet(4)		278,093			276,038			276,516			269,388			250,268
Operating Utilization(5)		94.5	%		95.4	%		92.3	%		92.1	%		89.6	%

(1)Primarily represents (gain) loss from sale of equipment. (2)2013 includes non-cash tax expense of $22,105 related to a $56,120 gain recognized solely for tax purposes related to a distribution of stock in a related company. See Note 10 to our Consolidated Financial Statements. (3)2011 includes equipment purchased with funds provided by capital leases. (4)Includes equipment on hire and equipment available for hire. (5)Operating Utilization is calculated by dividing the On-Hire fleet by the Active Fleet.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of the financial condition and results of operations of the Company should be read in conjunction with our historical consolidated financial statements and the related notes included elsewhere in this report. All dollar amounts discussed below are in thousands of U.S. dollars except per share amounts, or unless otherwise stated. This discussion and analysis contains forward-looking statements that involve risk, uncertainties and assumptions. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of many factors, including those discussed in "Risk factors" and elsewhere in this report.

Overview

We believe we are the largest intermodal chassis solutions provider, measured by total assets, for domestic and international transportation companies in North America. Our principal business is providing marine and domestic chassis on both long and short-term leases or rental agreements to a diversified customer base including the world's leading shipping lines, Class I railroads, major U.S. intermodal transportation companies and motor carriers.

Our fleet of equipment consists of marine and domestic chassis. These assets are owned, leased-in or managed by us on behalf of third-party owners in pooling arrangements. As of December 31, ~~2015~~2016, we owned, leased-in or managed a fleet of ~~311~~303,~~375~~246 chassis and units available for remanufacture. The net book value of our owned equipment was approximately $1.4542 billion.

We operate our business through two operating segments: the Marine Market segment and the Domestic Market segment.

•: Marine Market segment—primarily serving shipping lines and motor carriers with 20', 40' and 45' foot chassis. These chassis are used in the transport of dry or refrigerated marine shipping containers of the same size carrying goods between port terminals and/or railroad ramps and retail or wholesale warehouses or store locations, principally in the United States. We offer customers both long-term leases and short-term leases or rental agreements. As of December 31, 2016, our active fleet included 184,307 marine chassis.
•: Domestic Market segment—primarily serving railroads and major U.S. intermodal transportation companies with 53' chassis. These chassis are used in the transport of domestic shipping containers of the same size carrying goods between railroad ramps and retail or wholesale warehouses or store locations, principally in the United States. We offer customers both long-term leases and short-term leases or rental agreements. As of December 31, 2016, our active fleet included 80,182 domestic chassis.

As of December 31, 2016, approximately 15%, 1%, and 84% of our on-hire chassis fleet was leased on term leases, direct finance leases or in chassis pools, respectively. As of December 31, 2016, 21% of our on-hire fleet was under existing agreements that provided for total contractual cash flow of $171.7 million over the remaining life of the contracts assuming no leases are further renewed upon expiration.

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~~retail~~ The ortable ~~wholesale~~below ~~warehouses~~summarizes orour ~~store~~total ~~locations,~~fleet ~~principally~~by intype ~~the~~of ~~United~~lease ~~States.~~as ~~We offer customers both long-term leases and short-term leases or rental agreements. As~~ of December 31, ~~2015,~~ ~~our~~2016: ~~active fleet included 197,616 marine chassis.~~

As of December 31, 2015, approximately 17%, 1%, and 82% of our on-hire chassis fleet was leased on term leases, direct finance leases or in chassis pools, respectively. As of December 31, 2015, 23% of our on-hire fleet was under existing agreements that provided for total contractual cash flow of $140.4 million over the remaining life of the contracts assuming no leases are further renewed upon expiration.

	Units				Net book value

Total fleet by lease type	# of units		% of total		$ in millions		% of total		Average age (in years)		% of On-hire fleet
Term lease		36,505		12	$	186.9		13		14.1		15
Direct finance lease		3,464		1		11.3		1		10.8		1
Marine chassis pool		133,494		44		590.5		42		14.9		55
Domestic chassis pool		69,530		23		443.4		31		9.2		29

On-hire fleet		242,993		80		1,232.1		87		13.2		100

Available fleet		21,496		7		86.0		6		16.2

Active fleet		264,489		87		1,318.1		93		13.5

Units available for remanufacture		38,757		13		101.6		7

Total fleet		303,246		100	$	1,419.7		100

The table below summarizes our total fleet by type of lease as of December 31, 2015:

	Units				Net book value
Total fleet by lease type	# of units		% of total		$ in millions		% of total		Average age (in years)		% of On-hire fleet
Term lease		44,284		14	$	221.1		15		13.7		17
Direct finance lease		3,794		1		12.8		1		10.5		1
Marine chassis pool		147,285		47		602.4		42		14.9		56
Domestic chassis pool		67,407		22		463.1		32		8.2		26

On-hire fleet		262,770		84		1,299.4		90		13.1		100

Available fleet		15,323		5		64.7		4		16.0

Active fleet		278,093		89		1,364.1		94		13.3

Units available for remanufacture		33,282		11		84.7		6

Total fleet		311,375		100	$	1,448.8		100

Term lease products

Under a term lease, the lessee commits to a fixed lease term, typically between 1 and 5 years. We retain the benefit and residual value of equipment ownership and bear the risk of re-leasing the asset upon expiration of the lease. Our term lease renewal rate for the year ended December 31, ~~2015~~2016 approximated 8368%. During ~~2015~~2016, several of our lessees have opted to continue renting chassis from us through pool arrangements upon the expiration of their term leases. If we include these rentals, the renewal rate for the year ended December 31, ~~2015~~2016 would be approximately 8776%. The declining renewal rates reflect the continued trend toward pool arrangements which requires less chassis to be supplied than term leases.

Direct finance lease products

Direct finance lease terms and conditions are similar to those of our term leases, except that, under a direct finance lease, the ~~customer~~ customer commits to a fixed lease term and typically receives a bargain purchase option at the expiration of the lease. Under this arrangement, the substantive risks and benefits of equipment ownership are transferred to the lessee. The lease payments are segregated into principal and interest components that are similar to a loan. The interest component, calculated using the effective interest method over the term of the lease, is recognized as Finance revenue. The principal component of the lease is reflected as a reduction to the net investment in the direct finance lease. The typical initial term on these leases is between 53 and 10 years, with multiple renewals to extend the lease term by another 1 to 3 years.

Chassis pools

We operate and maintain domestic and marine chassis pools. A chassis pool is similar to a car rental model in which we provide a shared pool of chassis at major intermodal transportation points such as port terminals and railroad ramps for use by multiple customers on an as-needed basis. Additionally, we are a contributor to several cooperative pools. In a cooperative ("co-op") pool model, several chassis owners contribute chassis into a single pool for users. Contributors must contribute a number of chassis proportionate to that of their customer usage. An authorized user of the pool may use any chassis in that pool regardless of the owner/contributor of the chassis. Costs of the pool are charged back to the contributors in one of several allocation bases, either by total number of chassis contributed or by number of chassis actually used. Customers generally enter into pool user agreements for a period of one to five years and may be subject to subscription levels for minimum chassis usage. As of December 31, 2016, 15% of chassis pool revenue was generated by such minimum usage

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arrangements ~~Chassis~~reflecting ~~pools~~ recent trends toward a "pay-as-you-go" model. Multi-year agreements typically contain annual pricing reset features.

We operate and maintain domestic and marine chassis pools. A chassis pool is similar to a car rental model in which we provide a shared pool of chassis at major intermodal transportation points such as port terminals and railroad ramps for use by multiple customers on an as-needed basis. Additionally, we are a contributor to several cooperative pools. In a cooperative ("co-op") pool model, several chassis owners contribute chassis into a single pool for users. Contributors must contribute a number of chassis proportionate to that of their customer usage. An authorized user of the pool may use any chassis in that pool regardless of the owner/contributor of the chassis. Costs of the pool are charged back to the contributors in one of several allocation basis, either by total number of chassis contributed or by number of chassis actually used. Customers generally enter into pool user agreements for a period of one to three years and may be subject to subscription levels for minimum chassis usage. As of December 31, 2015, 23% of chassis pool revenue was generated by such minimum usage arrangements. Multi-year agreements typically contain annual pricing reset features.

Marine chassis pools

We operate pools and contribute chassis in many of the major port terminals and railroad ramps on the Eastern seaboard, Gulf Coast, Midwest, Pacific Northwest and the Pacific Southwest using marine 20', 40' and 45' chassis. As of December 31, ~~2015~~2016, we owned ~~133~~125,~~077~~762 chassis and managed 147,~~208~~732 chassis owned and contributed by ~~shipping~~ shipping lines for a total of ~~147~~133,~~285~~494 chassis engaged in providing this service. The net book value of our owned marine pool units amounted to $~~602~~590.45 million as of December 31, ~~2015~~2016. ~~Marine~~ Marine chassis pool customers pay per diem rates and in some cases are subject to subscription levels for minimum chassis usage that are typically one year in length. For the year ended December 31, ~~2015~~ 2016, approximately 2% of marine chassis pool revenue was generated under subscription arrangements~~, down from 4% in 2014 due to the mix of revenue~~.

Domestic chassis pools

Other revenue

Other revenue is derived from ~~three~~four primary sources: maintenance and repair service revenue, repositioning revenue, ~~and~~ management services revenue and emergency roadside repair revenue resulting from the Interstar Acquisition.

Primary operating performance metrics

Revenue growth for our business is driven by the size of our fleet, utilization of our equipment and average lease rates. We plan to grow our fleet by investing in new, used and remanufactured chassis. Our utilization rates are determined by the percentage of our total fleet that is on-hire, excluding chassis awaiting the remanufacture process. Typically, pooled chassis are in use by a customer between 70% and 90% of the time depending upon seasonality. However, to the extent our equipment is either assigned to chassis pools or managed by a third party, the equipment is considered fully utilized since it is not available for us to lease regardless of whether all of the units are generating income. The increase in utilization rates is, in part, due to the fact that as we grow our pools and allocate more chassis to pools, such assets are considered fully utilized and, therefore, increase our utilization rate. As of December 31, 2016 and 2015, our utilization rates were 91.9% and 94.5%, respectively.

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Primary operating performance metrics

Revenue growth for our business is driven by the size of our fleet, utilization of our equipment and average lease rates. We plan to grow our fleet by investing in new, used and remanufactured chassis. Our utilization rates are determined by the percentage of our total fleet that is on-hire, excluding chassis awaiting the remanufacture process. Typically, pooled chassis are in use by a customer between 70% and 90% of the time depending upon seasonality. However, to the extent our equipment is either assigned to chassis pools or managed by a third party, the equipment is considered fully utilized since it is not available for us to lease regardless of whether all of the units are generating income. The increase in utilization rates is, in part, due to the fact that as we grow our pools and allocate more chassis to pools, such assets are considered fully utilized and, therefore, increase our utilization rate. As of December 31, 2015 and 2014, our utilization rates were 94.5% and 95.4%, respectively.

Equipment lease rates are a function of several factors, including new equipment prices, which are primarily influenced by the price of steel, the price of tires, interest rates, the number of available chassis in the market, and demand, which is driven by import volumes. Average term lease rates are expected to change gradually as lease terms expire and new rates are set while marine and domestic pool rates are expected to rise more rapidly given the demand for the pool product. Average lease rate calculations are based on revenue earned divided by the average number of chassis on-hire for term lease products and pool products.

Customers pay higher per diem rates for our pool products compared to term lease products and direct finance lease products, which partially offsets higher operating costs and lower utilization rates for our pool products. In general, our profit margins tend to be higher with respect to our term leases versus our pool products since there are relatively few direct costs for term leases.

Our direct operating costs are a function of our leasing activity and utilization. As more units are turned in and leased out, our handling costs increase. Maintenance and repair expenses increase or decrease depending on the volume of repairs that we authorize. Repair volumes are dependent upon the number of chassis in our pools and the number of chassis returned to us upon the expiration of a term lease when sufficient demand exists to re-lease the chassis in a short period of time. As the manager in a chassis pool, we are responsible for the maintenance and repair of these chassis, which are evaluated for repairs each time they enter a port terminal or railroad ramp. With regard to our term lease chassis, we typically bear only the cost of maintenance and repair expenses related to ordinary wear and tear, and we evaluate and repair these term lease chassis when the lease term ends and the equipment is returned to us. With regard to direct finance lease products, all repairs are the responsibility of the lessee, and in most cases these units are purchased at the end of the term by the lessee. Storage charges for our units increase as our utilization declines and decrease as our utilization increases. Our selling, general and administrative expenses are driven by the size of our fleet and the complexity of our operations. Our capital costs are primarily driven by the size of our fleet, the price we pay for our assets and the cost of the debt associated with the purchase of those assets.

Operating costs

Our operating costs generally consist of direct operating costs, selling, general and administrative ~~costs~~expenses, capital costs associated with our equipment (depreciation and interest expense) as well as other costs. Direct operating expenses are primarily related to costs incurred in relation to leasing equipment that is not being leased to a third-party and for equipment in the Company's chassis pools. These expenses primarily consist of costs to repair and maintain the equipment, to store the equipment when it is not on lease, to reposition the equipment for pick-up by a customer, and equipment rental related costs to meet customer demand. Some of these costs are charged back to our lessees including the handling fees and a portion of the maintenance and repair expenses. Our selling, general and administrative expenses reflect the cost of our personnel, including our senior management, sales, operations, finance and accounting staff as well as our information technology infrastructure.

Seasonality

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and ~~Seasonality~~ eastern parts of the United States. We generally experience higher volumes of tire replacement costs during these months. No other significant seasonal trends currently exist in our business.

Our business experiences seasonal revenue trends that correlate directly to increases in the importation of goods via intermodal containers and domestic container traffic linked to the movement of goods in anticipation of the year-end holiday season. The "peak" season generally begins in the early third quarter and then begins to slow in the late third quarter and early part of the fourth quarter. This is when our revenues are generally the highest. Although in 2015, we experienced a "flattened" peak with volumes falling off more sharply in the fourth quarter than in prior years. Our operating expenses will move in tandem with the increased volume of container traffic and are also impacted by the warmer weather during the summer months in the mid-western, southern and eastern parts of the United States. We generally experience higher volumes of tire replacement costs during these months. No other significant seasonal trends currently exist in our business.

Critical accounting policies

Our consolidated financial statements have been prepared in conformity with U.S. GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the amounts reported in the financial statements. We base our estimates on historical experiences and assumptions believed to be reasonable under the circumstances and re-evaluate them on an ongoing basis. Several of the estimates and assumptions we are required to make relate to matters that are inherently uncertain as they pertain to future events and/or circumstances that are outside of our control. If a significant unfavorable change were to occur affecting the underlying assumptions of such events or circumstances, a material adverse impact to our consolidated results of operations, financial position and liquidity could result. Those estimates form the basis for our judgments that affect the amounts reported in the financial statements. Actual results could differ from our estimates under different assumptions or conditions. Our significant accounting policies, which may be affected by our estimates and assumptions, are more fully described in Note 2 "Summary of Significant Accounting Policies" to our Consolidated Financial Statements included elsewhere in this report.

Leasing equipment

Leasing equipment is primarily comprised of marine and domestic chassis. All equipment is recorded at cost and depreciated to an estimated residual value on a straight-line basis over the estimated useful life of the equipment.

Remanufacture / Refurbishment of Leasing Equipment. Older chassis can generally be remanufactured at the end of their useful life to provide 20 or more additional years of service rather than be replaced by new equipment. Remanufacturing provides a material cash savings compared to the cost of purchasing a new chassis. In addition to the cost savings, an additional benefit is that an older chassis can be remanufactured into any size unit, which provides excellent flexibility to meet demands of different equipment types as the market changes. Remanufacturing costs are capitalized and depreciated over the new useful life of the equipment.

Estimated useful lives and residual values have been principally determined based on our historical disposal and utilization experience. We view the inherent risk in these estimates to be low based on our experience in managing our fleet of chassis over the years.

Impairment of leasing equipment. We review our leasing assets for impairment when events or changes in circumstances indicate that the carrying amount of the asset group as a whole may not be recoverable. If indicators of impairment are present, a determination is made as to whether the carrying value of our fleet exceeds its estimated future undiscounted cash flows. Impairment exists when the carrying value of leasing assets taken as a whole exceeds the sum of the related undiscounted cash flows. Our review for impairment includes considering the existence of impairment indicators including third-party appraisals of our equipment, adverse changes in market conditions or the future utility of specific long-lived assets, shrinkage and the occurrence of significant adverse changes in general industry and market conditions that could affect the fair value of our equipment.

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~~Impairment~~Among the impairment indicators noted above, we view the impact of ~~leasing~~a ~~equipment. We~~potential ~~review~~downturn in the global economy as having the most significant impact and being the most important source of volatility on our leasing ~~assets~~asset ~~for~~valuation ~~impairment~~estimates. ~~when~~While ~~events~~we orhave ~~changes~~experienced volatility in ~~circumstances~~our ~~indicate~~impairment ~~that~~associated ~~the carrying amount~~with shrinkage and decisions to no longer support certain types of chassis in recent years, we believe we have the ~~asset~~appropriate ~~group~~controls asand ainfluence ~~whole~~over ~~may~~these matters and do not beview ~~recoverable.~~them Ifas ~~indicators~~being of ~~impairment~~a ~~are~~high ~~present,~~risk anature ~~determination~~in isthe ~~made~~future. asWhen toindicators ~~whether~~of impairment suggest that the carrying value of our ~~fleet~~leasing ~~exceeds~~assets ~~its~~may ~~estimated~~not ~~future undiscounted~~be ~~cash~~recoverable, ~~flows.~~we ~~Impairment~~determine ~~exists~~whether ~~when~~the impairment recognition criteria have been met by evaluating whether the carrying value of the leasing assets taken as a whole exceeds the ~~sum of the~~ related undiscounted future cash flows expected to result from the use and eventual disposition of the asset group. ~~Our~~The ~~review~~preparation ~~for~~of ~~impairment~~the ~~includes~~related undiscounted cash flows ~~considering~~requires the ~~existence~~use of ~~impairment~~assumptions ~~indicators~~and estimates, including ~~third-party~~the ~~appraisals~~level of ~~our~~future ~~equipment~~rents, ~~adverse~~and ~~changes~~the inresidual ~~market~~value ~~conditions~~expected orto ~~the~~be ~~future~~realized ~~utility~~upon disposition of ~~specific~~the ~~long-lived~~ assets, estimated downtime between re-leasing ~~shrinkage~~events and the ~~occurrence~~amount of ~~significant~~re-leasing ~~adverse~~costs. ~~changes~~While inwe ~~general~~believe ~~industry~~the estimates and ~~market~~assumptions ~~conditions~~used ~~that~~in ~~could~~developing ~~affect~~our undiscounted ~~the~~future ~~fair~~cash ~~value~~flows of our leasing equipment are reasonable, if a significant unfavorable change were to occur affecting the underlying assumptions of such future events or circumstances, a material adverse impact to our consolidated results and financial position could result.

Among the impairment indicators noted above, we view the impact of a potential downturn in the global economy as having the most significant impact and volatility on our leasing asset valuation estimates. While we have experienced volatility in our impairment associated with shrinkage and decisions to no longer support certain types of chassis in recent years, we believe we have the appropriate controls and influence over these matters and do not view them as being of a high risk nature in the future. When indicators of impairment suggest that the carrying value of our leasing assets may not be recoverable, we determine whether the impairment recognition criteria have been met by evaluating whether the carrying value of the leasing assets taken as a whole exceeds the related undiscounted future cash flows expected to result from the use and eventual disposition of the asset group. The preparation of the related undiscounted cash flows requires the use of assumptions and estimates, including the level of future rents, and the residual value expected to be realized upon disposition of the assets, estimated downtime between re-leasing events and the amount of re-leasing costs. While we believe the estimates and assumptions used in developing our undiscounted future cash flows of our leasing equipment are reasonable, if a significant unfavorable change were to occur affecting the underlying assumptions of such future events or circumstances, a material adverse impact to our consolidated results and financial position could result.

Capitalized Software

In accordance with FASB ASC Topic 350-40 "Internal Use Software", we capitalize certain computer software and software development costs incurred in connection with developing or obtaining computer software for internal use when both the preliminary project stage is completed and it is probable that the software will be used as intended. Capitalized software costs include only (i) external direct costs of materials and services utilized in developing or obtaining computer software, (ii) compensation and related benefits for employees who are directly associated with the software project and (iii) interest costs incurred while developing internal-use computer software. Determining the various stages of software development requires effective project management oversight and judgment. While we believe that our basis for determining the completion of various project stages is reasonable, if the project is delayed or if certain development efforts are unsuccessful, write off of previously capitalize amounts may be required. Capitalized software costs are included in Other assets in the Consolidated Balance Sheets and amortized on a straight-line basis when placed into service over the estimated useful lives of the software, approximately 7 years.

Goodwill

Goodwill represents the excess of purchase price and related costs over the value assigned to the net tangible and identifiable ~~intangible~~ intangible assets of businesses acquired. In accordance with the Intangibles—Goodwill and Other Topic of the FASB ASC, goodwill is not amortized, but instead is tested for impairment at the reporting unit level annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. Such review is subjective and relies upon the collective insight and experience of the senior management team. Management has determined that there are two reporting units, the Marine Market segment and the Domestic Market segment. For the purpose of testing goodwill for impairment, the goodwill balance has been assigned to these two reporting units using a relative fair value allocation approach. As of December 31, 2016, there was no impairment of goodwill for either segment.

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~~purpose~~model ofwere ~~testing~~primarily ~~goodwill~~derived ~~for~~from ~~impairment,~~publicly available market data. Although management uses the ~~goodwill~~best ~~balance~~estimates ~~has~~available, ~~been~~if ~~assigned~~actual toresults ~~these~~fall ~~two~~below ~~reporting~~the ~~units~~estimated ~~using~~budgets aand ~~relative~~long range projections used for the fair value ~~allocation~~calculation ~~approach.~~or Ascost of ~~December 31,~~capital ~~2015,~~rates ~~there was~~differ nofrom ~~impairment~~the ofinputs ~~goodwill~~used ~~for~~to ~~either~~calculate ~~segment~~discounted cash flow, a different result could be obtained.

We evaluate the recoverability of goodwill using a two-step impairment test approach. In the first step, our fair value is compared to its carrying value including goodwill. Fair value is estimated using a discounted cash flow analysis based on current operating budgets and long-range projections. The assumptions for the projections are based on management's historical experience as well as their future expectations of market conditions. Estimated cash flows are discounted based on market comparable weighted-average cost of capital rates derived from the capital asset pricing model. The inputs to the model were primarily derived from publicly available market data. Although management uses the best estimates available, if actual results fall below the estimated budgets and long range projections used for the fair value calculation or cost of capital rates differ from the inputs used to calculate discounted cash flow, a different result could be obtained.

Derivative instruments and hedging activities

We account for derivative instruments in accordance with the Derivatives and Hedging Topic of the FASB ASC. The FASB ASC requires that all derivative instruments be recorded on the balance sheet at their fair value and establishes criteria for both the designation and effectiveness of hedging activities. We have entered into derivative instruments in the form of interest rate swaps, which are used to reduce our interest rate risk. Through these interest rate swaps, we receive floating rate payments in exchange for fixed rate payments, effectively converting our floating rate debt to fixed rate debt. We estimate fair values for our derivative instruments. Since our derivative instruments are not publicly traded on an organized exchange, in the absence of quoted market prices, we develop an estimate of fair value using cash flows discounted at relevant market interest rates in effect at the period close. The use of fair value techniques involves significant judgments and assumptions, including estimates of future interest rate levels based on interest rate yield curves, credit spreads of our counterparties, volatility factors, and an estimation of the timing of future cash flows. The use of different assumptions may have a material effect on the estimated fair value amounts recorded in our consolidated financial statements. As a matter of policy, we do not enter into derivative instruments for speculative purposes.

The manner in which a derivative instrument is recorded depends on whether it qualifies for hedge accounting. Hedge accounting requires that, at the beginning of each hedge period, we justify an expectation that the relationship between the changes in fair value of derivatives designed as hedges compared to changes in the fair value of the underlying hedged items will be highly effective. This effectiveness assessment, which is performed at least quarterly, involves an estimation of changes in fair value resulting from changes in interest rates, as well as the probability of the occurrence of transactions for cash flow hedges. The use of different assumptions and changing market conditions may impact the results of the effectiveness assessment and ultimately the timing of when changes in derivative fair values and the underlying hedged items are recorded in our ~~statement~~Consolidated Statement of ~~operations~~Operations. Once qualified, we apply hedge accounting and designate and account for ~~interest~~ interest rate swap contracts as cash flow hedges. For effective cash flow hedges, changes in fair value are deferred and recorded in ~~accumulated~~Accumulated other comprehensive loss in the Consolidated Balance Sheets. The ineffective portion of cash flow hedges is recognized in earnings immediately and recorded in Interest expense in the Consolidated Statements of Operations.

Provision for doubtful accounts

Beginning in 2011 and continuing through ~~2015~~2016, certain of our shipping line customers migrated away from providing chassis as an integral part of their transportation-related services. As a result, we are providing a greater number of chassis directly to motor carriers who represent a higher credit risk than our traditional customer base that generally consists of larger companies with greater liquidity and resources. Notwithstanding this change, our methodology for assessing the adequacy of the provision for doubtful accounts has not changed significantly.

We determine the provision for doubtful accounts based on our assessment of the collectability of our receivables. We identify these accounts based on two methods: (1) a customer-by-customer basis and (2) an allowance method. In the first method, we review certain accounts based on size, payment history and third-party credit reports and place a likelihood of default percentage on each account individually. Under the allowance method, we apply a delinquency factor based on prior history which represents our best estimate of those accounts that will become uncollectible. While we believe our

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~~than~~process ~~our~~for ~~traditional~~identifying credit risk in our customer base ~~that~~is ~~generally~~effective, ~~consists~~changes ofin ~~larger~~economic ~~companies~~conditions ~~with~~may ~~greater~~require ~~liquidity~~a ~~and~~re-assessment ~~resources.~~of ~~Notwithstanding~~the ~~this~~risk ~~change,~~and ~~our~~could ~~methodology~~result ~~for~~in ~~assessing~~increases ~~the~~or ~~adequacy~~decreases ofin the ~~provision~~allowance for doubtful accounts ~~has not changed significantly~~.

Provision (benefit) for income taxes

We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. In making such determination, we consider all available positive and negative evidence,. ~~including~~After ~~scheduled~~considering ~~reversals~~the ~~of deferred tax liabilities, projected~~ future ~~taxable~~reversal ~~income, tax planning strategies and recent results~~ of ~~operations.~~our Inexisting ~~the~~taxable ~~event~~temporary wedifferences ~~were~~coupled ~~to determine~~with ~~that~~future weearnings ~~would~~and ~~be able to realize deferred income~~ tax ~~assets~~planning ~~in the future in excess of their net recorded amount~~strategies, we ~~would~~do ~~make~~not anbelieve ~~adjustment~~a ~~to the~~ valuation allowance ~~which would reduce~~ ~~the~~is ~~provision~~required ~~(or increase the benefit) for income taxes. Currently, we do not record valuation allowances~~ on the majority of our deferred tax assets.

Income taxes have been provided based upon the tax laws and rates in countries in which our operations are conducted and income is earned. Our chassis leasing business is domiciled in the United States and, therefore, income is subject to United States taxation. The provision for income taxes recorded relates to the income earned by certain of our subsidiaries, which are located in or have earned income in jurisdictions that impose income taxes, primarily in the United States. We are also subject to income tax in Canada and Mexico. See Note 10 to our Consolidated Financial Statements.

The rules governing taxation are complex and subject to varying interpretations. Therefore, our tax accruals reflect a series of complex judgments about future events and rely heavily on estimates and assumptions. Although we believe the estimates and assumptions supporting our tax accruals are reasonable, the potential result of an audit or litigation related to tax could include a range of outcomes, and could result in tax liabilities materially different than those reflected in our consolidated financial statements.

Recently adopted and recently issued accounting standards

Adopted in ~~2015~~2016

In ~~April~~August ~~2014~~2016, the FASB issued authoritative guidance on accounting for ~~Presentation~~Statement of ~~Financial~~Cash ~~Statements~~ Flows (Topic ~~205~~ 230) Classification ~~and~~of ~~Property,~~Certain ~~Plant,~~Cash Receipts and ~~Equipment~~Cash Payments: (~~Topic 360~~"ASU 2016-15"):. ~~Reporting~~The ~~Discontinued~~standard ~~Operations~~provides guidance on eight specific cash flow items and ~~Disclosures~~their ofclassifications ~~Disposals~~in the statement of ~~Components~~cash offlows anthereby ~~Entity ("ASU 2014-08")~~reducing the current and potential future diversity in practice. The amendments in this update are effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, provided that all of the amendments are adopted in the same period. The adoption of this standard in 2016 did not have any impact on the Company's Consolidated Financial Statements.

Pending Adoption

In May 2014, the FASB issued authoritative guidance on accounting for Revenue from Contracts with Customers (Topic 606): ("ASU 2014-09"). This update supersedes most of the current revenue recognition requirements. The core principle of the new guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

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inNew ~~this~~disclosures ~~update~~about ~~changes~~ the ~~criteria~~nature, ~~for~~amount, ~~determining~~timing ~~which~~and ~~disposals~~uncertainty ~~can~~of berevenue ~~presented~~and ascash ~~discontinued~~flows ~~operations~~arising ~~and~~from ~~modifies~~contracts ~~the~~with ~~related~~customers ~~disclosure~~are ~~requirements~~also required. ~~Under~~This ~~the new~~ guidance, awas ~~discontinued operation~~effective isfor ~~defined~~fiscal asyears aand interim ~~disposal~~periods ofbeginning aafter ~~component~~December 15, or2016 ~~group~~and ofearly ~~components~~application ~~that~~was ~~represents~~not apermitted. ~~strategic~~However, ~~shift~~on ~~that has~~July 9, ~~or will have~~2015, athe ~~major~~FASB ~~effect~~decided onto andelay ~~entity's~~the ~~operations~~effective ~~and~~date ~~financial~~by ~~results~~one year. The ~~revised~~deferral ~~guidance~~results isin the new revenue standard being effective for ~~annual~~ fiscal years and interim periods beginning after December 15, ~~2014~~2017. ~~and~~The FASB also decided to allow early adoption isbut ~~permitted.~~no ~~The~~earlier than ~~Company~~the ~~adopted~~original ~~this~~effective ~~guidance~~date onof ~~January~~December 115, ~~2015~~2016. ~~The~~Entities must adopt the new guidance using one of two retrospective application methods. We established a team comprised of people that ~~adoption~~are familiar with the contracts we have with our customers within each of ~~this~~our segments. We are in the process of performing a preliminary analysis with regard to such contracts to evaluate the potential effect of the new standard ~~had~~and norelated ~~impact~~disclosures, onas well as which transition method we will elect. We will continue to review the ~~Company's~~terms ~~Consolidated~~of ~~Financial~~such ~~Statements~~contracts to determine if material differences exist under the new standard versus our existing revenue recognition policy, and will update our disclosure as material changes, if any, are identified.

InOn ~~June~~February 25, ~~2014~~2016, the FASB issued authoritative guidance on accounting for ~~Compensation-Stock~~Leases ~~Compensation~~ (Topic ~~718~~842): ~~Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period~~ ("ASU ~~2014~~ 2016-1202"). The ~~amendments~~FASB is ~~require~~issuing ~~that~~this ~~a performance~~update ~~target~~to ~~that~~increase ~~affects~~transparency ~~vesting~~ and ~~that~~comparability ~~could~~among beorganizations ~~achieved~~by ~~after~~recognizing ~~the~~lease ~~requisite~~assets ~~service~~and ~~period~~lease beliabilities ~~treated~~on asthe abalance ~~performance~~sheet ~~condition.~~and ~~The~~disclosing ~~performance~~key ~~target~~information ~~should not be reflected in~~about ~~estimating~~leasing ~~the grant date fair value of the award~~arrangements. ~~Compensation~~This ~~cost~~guidance ~~should~~is beeffective ~~recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s)~~ for ~~which~~fiscal ~~the~~years ~~requisite~~beginning ~~service~~after ~~has~~December 15, ~~already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period~~2018, ~~the~~including ~~remaining~~interim ~~unrecognized~~periods ~~compensation~~within ~~cost~~those ~~should~~fiscal ~~be recognized prospectively over the remaining requisite service period~~years. ~~The~~Entities ~~total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that~~ are ~~expected~~required to ~~vest~~adopt ~~and should be adjusted to reflect those awards that ultimately vest. The amendments in~~ this ~~Update~~guidance ~~are~~using ~~effective~~a ~~for~~modified ~~annual~~retrospective ~~periods and interim periods beginning after December 15, 2015~~approach. ~~Earlier adoption is permitted.~~ The Company ~~adopted~~is ~~this~~currently ~~guidance~~evaluating ~~for~~ the ~~year~~standard ~~ended December 31,~~to ~~2015~~determine ~~which~~the ~~had~~impact noof ~~impact~~its adoption on the ~~Company's~~ Consolidated Financial Statements.

In ~~August~~March ~~2014~~2016, the FASB issued authoritative guidance on accounting for ~~Presentation~~Compensation—Stock ofCompensation ~~Financial Statements-Going Concern~~ (~~Subtopic~~Topic ~~205-40~~718): ~~Disclosure~~Improvements ~~of Uncertainties about an Entity's Ability~~ to ~~Continue~~Employee Share-Based asPayment aAccounting: ~~Going Concern~~ ("ASU ~~2014~~2016-1509"). The amendments in this update ~~provide~~affect ~~guidance~~all onentities ~~management's~~that ~~responsibility~~issue ~~in evaluating~~share-based ~~whether~~payment ~~there~~awards isto ~~substantial~~their ~~doubt~~employees. ~~about~~The annew guidance ~~entity's~~requires ~~ability~~excess totax ~~continue~~benefits asand atax ~~going~~deficiencies ~~concern~~to ~~and~~be torecorded ~~provide~~in ~~related~~the ~~footnote~~income ~~disclosures.~~statement ~~Currently,~~when ~~there~~the isawards novest ~~guidance~~or inare Usettled.~~S. GAAP~~ In addition, ~~about~~cash ~~management's~~flows ~~responsibility~~related to ~~evaluate~~excess ~~whether~~tax ~~there~~benefits iswill ~~substantial~~no ~~doubt~~longer ~~about~~be anseparately ~~entity's~~classified ~~ability to continue~~ as a ~~going~~financing ~~concern~~activity orapart tofrom ~~provide~~other ~~related~~income ~~footnote~~tax ~~disclosures.~~cash Uflows.S. ~~auditing standards~~The ~~and~~standard ~~federal~~also ~~securities~~allows ~~law~~entities ~~require~~to ~~that~~repurchase anmore of ~~auditor evaluate whether there is substantial doubt about~~ an ~~entity~~employee's ~~ability~~shares ~~to continue as a going concern~~ for atax ~~reasonable~~withholding ~~period~~purposes ofwithout ~~time~~triggering ~~not~~liability ~~to exceed~~accounting, ~~one~~clarifies ~~year~~that ~~beyond~~all ~~the~~cash ~~date~~payments ofmade ~~the~~on ~~financial~~an ~~statements~~employee's ~~being~~behalf ~~audited.~~for ~~Because~~withheld ofshares ~~the~~should ~~lack~~be ofpresented ~~guidance in U.S. GAAP and the differing views about when there is substantial doubt about an entity's ability to continue~~ as a financing ~~going~~activity ~~concern,~~on ~~there~~the iscash ~~diversity~~flow ~~in whether~~statement, ~~when,~~ and ~~how~~provides an ~~entity~~accounting ~~discloses~~policy ~~the~~election ~~relevant~~to ~~conditions~~account ~~and~~for ~~events~~forfeitures inas ~~its~~they ~~footnotes~~occur. ~~These amendments should reduce diversity in the timing and content of footnote disclosures.~~ The amendments in this update are effective for ~~the~~ annual ~~period~~periods beginning ~~ending~~ after December 15, 2016, and ~~for~~interim ~~annual~~ periods ~~and~~within ~~interim periods~~those ~~thereafter~~annual periods. Early ~~application~~adoption is permitted. The Company ~~adopted~~believes ~~this~~there ~~guidance~~will ~~for~~be ~~the~~no ~~year~~significant ~~ended~~impact ~~December 31,~~to ~~2015~~the ~~which~~Company's Consolidated ~~did~~Financial ~~not~~Statements ~~change~~upon ~~the~~adoption ~~disclosures~~ in ~~the Notes to the Consolidated Financial Statements~~2017.

InNo ~~April~~other ~~2015,~~new ~~the~~accounting ~~Financial~~pronouncements ~~Accounting Standards Board ("FASB")~~ issued ~~authoritative~~or ~~guidance~~effective onduring ~~accounting~~2016 ~~for~~had ~~Interest-Imputation~~or ofare ~~Interest~~expected ~~(Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs ("ASU 2015-03"). This update requires that debt issuance cost related~~ to ahave ~~recognized debt liability be presented in the balance sheet as~~ a ~~direct~~material ~~deduction~~impact from the carrying amount of the debt liability, consistent with debt discounts, without changing existing recognition and measurement guidance for debt issuance costs. The new guidance is required to be applied on a retrospective basis and to be accounted for as a change in an accounting principle. The amendments in this update are effective for financial statements issued for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years and early adoption of the ~~amendments~~Company's inConsolidated ~~this~~Financial ~~update is permitted~~Statements. ~~The~~

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~~Company~~ ~~adopted this standard for the year ended December 31, 2015 on a retrospective basis. The adoption of this standard resulted in the reclassification of certain debt issuance costs from~~ ~~Other~~ 2016 ~~assets~~versus ~~to a reduction in the carrying amount of the related debt liability within the Consolidated Balance Sheets. See Note 2.~~ 2015

In ~~September 2015, the Financial Accounting Standards Board ("FASB") issued authoritative guidance on accounting for Business Combinations (Topic 805):~~ ~~Simplifying the Accounting for Measurement-Period Adjustments ("ASU 2015-16"). The guidance requires that adjustments to provisional amounts recognized in a business~~ ~~combination be recorded during the measurement period in the period in which the adjustment amounts are determined. The amendments in this update require that the acquirer record, in the same period's~~ ~~financial statements, the effects on earnings of changes in depreciation, amortization, or other income effects, if any, as the result of the change to the provisional amounts, calculated as if the~~ ~~accounting had been completed at the acquisition date. Additional disclosures are required to clarify the impact the adjustments to provisional amounts would have had on prior periods (by income~~ ~~statement~~Comparison ~~line~~of ~~item).~~our ~~The~~consolidated ~~update~~results ~~is effective~~ for ~~reporting~~the ~~periods~~year ~~beginning~~ended ~~after~~ December 1531, ~~2015~~2016 ~~and~~to ~~for interim periods within those fiscal years, with early adoption permitted. The Company adopted this guidance for~~ the year ended December 31, 2015 ~~which had no impact on the Company's Consolidated Financial Statements.~~

Pending Adoption

	Year Ended December 31,						Variance

	2016			2015			$ change			% change
Revenues:
Equipment leasing revenue	$	624,728		$	661,247		$	(36,519	)		(6	)
Finance revenue		1,390			1,536			(146	)		(10	)
Other revenue		43,085			28,641			14,444			50

Total revenues	$	669,203		$	691,424		$	(22,221	)		(3	)

Expenses:
Direct operating expenses		373,966			377,715			(3,749	)		(1	)
Selling, general and administrative expenses		98,023			91,279			6,744			7
Depreciation expense		74,414			72,128			2,286			3
Provision (recovery) for doubtful accounts		7,812			(258	)		8,070				**
Impairment of leasing equipment		13,917			7,277			6,640			91
Restructuring expense		1,806			—			1,806				**
Loss on modification and extinguishment of debt and capital lease obligations		7,486			19,852			(12,366	)		(62	)
Interest expense		62,777			80,246			(17,469	)		(22	)
Interest income		(109	)		(19	)		(90	)			**
Other income, net		(1,607	)		(1,394	)		(213	)		15

Total expenses		638,485			646,826			(8,341	)		(1	)

Income before provision for income taxes		30,718			44,598			(13,880	)		(31	)
Provision for income taxes		10,793			17,880			(7,087	)		(40	)

Net income	$	19,925		$	26,718		$	(6,793	)		(25	)

Adjusted EBITDA(1)	$	195,771		$	227,228		$	(31,457	)		(14	)

In ~~May 2014, the FASB issued authoritative guidance on accounting for Revenue from Contracts with Customers~~ **Not meaningful (~~Topic 606~~1)~~: ("ASU 2014-09"). This update supersedes most of the current revenue recognition requirements. The core principle of the new guidance is that an~~For ~~entity~~a ~~should~~reconciliation ~~recognize revenue to depict the transfer~~ of ~~promised~~Adjusted ~~goods~~EBITDA ~~or services~~ to ~~customers in an amount that reflects~~ the ~~consideration~~most todirectly ~~which~~comparable ~~the entity expects to be entitled in exchange for those goods or services~~U. ~~New disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers are also required~~S. ~~This guidance was effective for fiscal years and interim periods beginning after December~~ ~~15,~~GAAP ~~2016 and early application was not permitted. However on July 9~~measures, ~~2015,~~see ~~the~~"Non-GAAP ~~FASB decided to delay the effective date by one year~~Measures". ~~The deferral results in the new revenue standard being effective for fiscal years and interim~~ ~~periods~~ beginning after December 15, 2017. The FASB also decided to allow early adoption but no earlier than the original effective date of December 15, 2016. Entities must adopt the new guidance using one of two retrospective application methods. The Company is currently evaluating the standard to determine the impact of its adoption on the Consolidated Financial Statements.

On ~~February 25, 2016, the FASB issued authoritative guidance on accounting for Leases (Topic 842): ("ASU 2016-02"). The FASB~~ ~~is issuing this update to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about~~ ~~leasing arrangements. This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Entities are required to adopt this~~ ~~guidance using a modified retrospective approach. The Company is currently evaluating the standard to determine the impact of its adoption on the Consolidated Financial Statements.~~ Revenues

~~No other~~Total ~~new~~Company ~~accounting~~revenue ~~pronouncements~~was ~~issued~~$669.2 million orfor ~~effective~~the ~~during~~year ~~2015~~ended ~~had~~December 31, or2016 ~~are~~compared ~~expected~~ to ~~have~~$691.4 million afor ~~material~~the ~~impact~~year onended December 31, ~~the~~2015, ~~Company's~~a ~~Consolidated~~decrease ~~Financial~~of ~~Statements~~$22.2 million or 3%.

Equipment leasing revenue was $624.7 million for the year ended December 31, 2016 compared to $661.2 million for the year ended December 31, 2015, a decrease of $36.5 million or 6%. This decrease was primarily due to a 1% decrease in average per diem rates, which resulted in a decrease in equipment leasing revenue of $8.9 million and a decrease in the average on-hire fleet of approximately 11,500 chassis, or 4%, which led to a decrease in equipment leasing revenue of $29.3 million. The decrease in the on-hire fleet was due to lower over-all demand and continued scrapping of end of life equipment. These decreases were partially offset by one additional billing day during the year ended December 31, 2016 which led to an increase in equipment leasing revenue of $1.7 million.

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The overall decrease in average per diem rates was primarily due to lower chassis usage within our marine pools, the impact of which was partially offset by higher per diem rates charged to motor carriers during the current year period and an increase in chassis usage and average per diem rates within our domestic pool.

Finance revenue was $1.4 million for the year ended December 31, 2016 compared to $1.5 million for the year ended December 31, 2015, a decrease of $0.1 million or 7%. This decrease was primarily the result of a reduction in the average investment in direct finance leases of $2.1 million due to normal amortization through principal payments and maturing lease arrangements, partially offset by an increase in the average interest rate for new direct finance lease arrangements.

Other revenue was $43.1 million for the year ended December 31, 2016 compared to $28.6 million for the year ended December 31, 2015, an increase of $14.5 million or 51%. This increase was primarily attributable to $15.3 million of emergency roadside repair billings resulting from the Interstar Acquisition and a $2.6 million increase in repair billings. These increases were partially offset by a $2.4 million reduction in billings for the repositioning of equipment and a decrease in scrap metal proceeds in connection with the disposal of end-of-life chassis of $1.0 million.

Marine Market segment

Total Marine Market segment revenue was $453.2 million for the year ended December 31, 2016 compared to $497.3 million for the year ended December 31, 2015, a decrease of $44.1 million or 9%.

	Year Ended December 31,

Key Operating Statistics	2016		2015		Variance			% Change
Marine Market segment
Pool Statistics
Per Diem Revenue	$	405,274	$	444,513	$	(39,239	)		(9	)
Average Total Fleet		140,783		149,004		(8,221	)		(6	)
Average Daily Revenue per Chassis	$	7.87	$	8.17	$	(0.30	)		(4	)
Term Lease Statistics
Per Diem Revenue	$	35,248	$	37,937	$	(2,689	)		(7	)
Average Total Fleet		29,301		33,342		(4,041	)		(12	)
Average Daily Revenue per Chassis	$	3.29	$	3.12	$	0.17			5

Per Diem Revenue represents revenues billed under operating leases and excludes amounts billed to lessees for maintenance and repair, positioning and handling, and other ancillary charges.

Average Total Fleet is based upon the total fleet at each month end.

Equipment leasing revenue was $440.5 million for the year ended December 31, 2016 compared to $482.5 million for the year ended December 31, 2015, a decrease of $42.0 million or 9%. Marine pool per diem revenues decreased $39.2 million or 9%. This decrease was primarily due to a 6% decrease in the average number of chassis in our marine pools and a 4% decrease in the average per diem rates in our marine pools. These decreases were partially offset by one additional billing day during the year ended December 31, 2016 which led to an increase in equipment leasing revenue of $1.1 million. The decrease in average per diem rates was primarily due to lower chassis usage within our marine pools, the impact of which was partially offset by higher per diem rates charged to motor carriers during the current year period. The net reduction in the number of chassis in our marine pools was primarily due to moving chassis into depot and long-term storage locations and a reduction in leased-in chassis, both of which are a result of the decline in demand experienced during the current year period. Marine pool per diem revenues attributable to motor carriers rose to 61% of total marine pool per diem revenue for the year ended December 31, 2016 from 54% for the year ended December 31, 2015. Marine term lease revenues decreased $2.7 million or 7% primarily due to a 12% decrease in the average number of

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chassis on-hire, partially offset by a 5% increase in the average per diem rates. The decrease in the average number of chassis on hire was primarily due to reduced demand experienced during the current year period. The increase in the average per diem rates was primarily due to the expiration of lower rate term leases and incremental term leases at higher per diem rates.

Other revenue was $11.3 million for the year ended December 31, 2016 compared to $13.3 million for the year ended December 31, 2015, a decrease of $2.0 million or 15%. This decrease was primarily attributable to a $1.4 million reduction in repair billings and a $0.6 million decrease in billings for the repositioning of equipment.

Domestic Market segment

Total Domestic Market segment revenue was $191.2 million for the year ended December 31, 2016 compared to $187.4 million for the year ended December 31, 2015, an increase of $3.8 million or 2%.

	Year Ended December 31,

Key Operating Statistics	2016		2015		Variance			% Change
Domestic Market segment
Pool Statistics
Per Diem Revenue	$	169,612	$	162,837	$	6,775			4
Average Total Fleet		68,104		65,930		2,174			3
Average Daily Revenue per Chassis	$	6.81	$	6.77	$	0.04			1
Term Lease Statistics
Per Diem Revenue	$	14,595	$	15,959	$	(1,364	)		(9	)
Average Total Fleet		10,923		12,375		(1,452	)		(12	)
Average Daily Revenue per Chassis	$	3.65	$	3.53	$	0.12			3

Per Diem Revenue represents revenues billed under operating leases and excludes amounts billed to lessees for maintenance and repair, positioning and handling, and other ancillary charges.

Average Total Fleet is based upon the total fleet at each month end.

Equipment leasing revenue was $184.2 million for the year ended December 31, 2016 compared to $178.8 million for the year ended December 31, 2015, an increase of $5.4 million or 3%. Domestic pool per diem revenues increased $6.8 million or 4%. This increase was primarily due to a 3% increase in the average number of chassis in our domestic pools, a 1% increase in the average per diem rates in our domestic pools and one additional billing day during the year ended December 31, 2016 which led to an increase in equipment leasing revenue of $0.5 million. Domestic term lease revenues decreased $1.4 million or 9% primarily due to a 12% decrease in the average number of chassis on-hire, partially offset by a 3% increase in the average per diem rates.

Other revenue was $6.9 million for the year ended December 31, 2016 compared to $8.5 million for the year ended December 31, 2015, a decrease of $1.6 million or 19%. This decrease was primarily attributable to a $1.5 million reduction in billings for the repositioning of equipment and a $0.1 million decrease in repair billings.

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Direct operating expenses

Total Company direct operating expenses were $374.0 million for the year ended December 31, 2016 compared to $377.7 million for the year ended December 31, 2015, a decrease of $3.7 million or 1%. Overall maintenance and repair expenses decreased $9.2 million or 3%, which includes $10.9 million of incremental maintenance and repair expenses resulting from the Interstar Acquisition. Maintenance and repair expenses within our Marine and Domestic Market Segments decreased $17.9 million or 7%, which was primarily due to a lower average cost per repair, as well as a net decrease in the average number of chassis operating in our marine and domestic chassis pools, partially offset by a higher frequency of repairs. The decrease in the average cost per repair within the Marine Market segment was primarily due to reduced maintenance and repair spending in response to the reduced demand experienced during the year ended December 31, 2016 versus the comparable period of 2015, partially offset by a higher frequency of repairs. Maintenance and repair expenses for chassis residing at third party depots and at the Company's service centers decreased $2.2 million during the year ended December 31, 2016 versus the comparable period of 2015. Additionally, there was a reduction in chassis usage fees of $4.5 million. These decreases were partially offset by an increase in pool operational expense of $3.4 million, as well as an increase in repositioning and handling expenses and storage costs of $3.3 million and $2.9 million, respectively. The increase in pool operational expense was primarily due to facility rental agreements in the Northeast entered into during the fourth quarter of 2015. Other direct operating expenses increased by $0.4 million.

Marine Market segment

Direct operating expenses for the Marine Market segment were $275.3 million for the year ended December 31, 2016 compared to $293.9 million for the year ended December 31, 2015, a decrease of $18.6 million or 6%. Maintenance and repair expenses decreased $20.7 million or 9%, which was primarily due to a lower average cost per repair and a decrease in the average number of chassis operating in our marine chassis pools. The decrease in the average cost per repair was primarily due to reduced maintenance and repair spending in response to the reduced demand experienced during the year ended December 31, 2016 versus the comparable period of 2015, partially offset by a higher frequency of repairs. Additionally, there was a reduction in chassis usage fees of $5.1 million. These decreases were partially offset by an increase in pool operational expense of $3.3 million and storage costs of $3.2 million. In addition, repositioning and handling expenses increased $0.7 million versus the comparable period of 2015.

Domestic Market segment

Direct operating expenses for the Domestic Market segment were $66.7 million for the year ended December 31, 2016 compared to $61.8 million for the year ended December 31, 2015, an increase of $4.9 million or 8%. Maintenance and repair expenses increased $2.8 million or 6%, which was primarily due to a 3% increase in the average number of chassis operating in our domestic chassis pools and an increase in the average cost per repair partially offset by a lower frequency of repairs during the year ended December 31, 2016 versus the comparable period of 2015. Additionally, we experienced an increase in repositioning and handling expenses of $1.3 million and chassis usage fees of $0.5 million. Other direct operating expenses increased by $0.3 million.

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Revenues and Adjusted EBITDA by segment

	Revenues							Adjusted EBITDA

	Year Ended Dec 31, 2016		Year Ended Dec 31, 2015		Variance			Year Ended Dec 31, 2016			Year Ended Dec 31, 2015			Variance
Consolidated Statement of Operations Data:
Marine Market segment	$	453,217	$	497,268	$	(44,051	)	$	112,175		$	150,934		$	(38,759	)
Domestic Market segment		191,164		187,387		3,777			102,915			107,305			(4,390	)

Total Reportable segments	$	644,381	$	684,655	$	(40,274	)	$	215,090		$	258,239		$	(43,149	)
Other		24,822		6,769		18,053			(19,319	)		(31,011	)		11,692

Total Company	$	669,203	$	691,424	$	(22,221	)	$	195,771		$	227,228		$	(31,457	)



Principal collections on direct finance leases									(2,945	)		(3,665	)
Share-based compensation									(1,821	)		(625	)
Non-recurring professional fees primarily associated with termination of bond offering									(1,603	)		—
Restructuring expense									(1,806	)		—
Depreciation expense									(74,414	)		(72,128	)
Impairment of leasing equipment									(13,917	)		(7,277	)
Loss on modification and extinguishment of debt and capital lease obligations									(7,486	)		(19,852	)
Interest expense									(62,777	)		(80,246	)
Other income, net									1,607			1,144
Interest income									109			19

Income before provision for income taxes									30,718			44,598
Provision for income taxes									10,793			17,880

Net income								$	19,925		$	26,718

Selling, general and administrative expenses

Selling, general and administrative expenses were $98.0 million for the year ended December 31, 2016 compared to $91.3 million for the year ended December 31, 2015, an increase of $6.7 million or 7%. This increase was primarily due to incremental expenses of $3.6 million resulting from the Interstar Acquisition and increased employee-related expenses in support of operational cost containment initiatives, including in-sourcing depot operations at select locations. Also contributing to this increase were consulting fees in support of information technology initiatives, higher occupancy costs associated with our new corporate headquarters and $1.6 million of costs associated with a debt offering process which was terminated during March 2016. These increases were partially offset by incremental capitalization of compensation and related benefit costs for employees directly associated with the development of Project Helix and a reduction in incentive-based compensation.

Depreciation expense

Depreciation expense was $74.4 million for the year ended December 31, 2016 compared to $72.1 million for the year ended December 31, 2015, an increase of $2.3 million or 3%. This increase was primarily due to incremental depreciation expense resulting from chassis acquired and remanufactured since January 1, 2016. The aforementioned chassis acquisitions were related to marine chassis purchased from the shipping lines and the purchase of previously leased-in domestic chassis to

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support the growth in the domestic pool. Also contributing to the increase in depreciation expense were amortized costs for leasehold improvements, furniture and fixtures and computer equipment acquisitions associated with our new corporate headquarters and incremental depreciation expense resulting from the Interstar Acquisition.

Provision (recovery) for doubtful accounts

The provision for doubtful accounts was $7.8 million for the year ended December 31, 2016 compared to a recovery of $0.3 million for the year ended December 31, 2015, an increase of $8.1 million versus the comparable period of 2015. This increase was primarily due to a $6.9 million incremental reserve requirement resulting from Hanjin Shipping's August 2016 bankruptcy filing, as well as incremental billings to motor carriers, partially offset by an improved collection experience with our motor carriers.

Impairment of leasing equipment

We recorded impairment charges on leasing equipment of $13.9 million for the year ended December 31, 2016 compared to $7.3 million for the year ended December 31, 2015, an increase of $6.6 million. This increase was primarily due to a greater number of end-of-life chassis impaired during the year ended December 31, 2016 versus the comparable period of 2015 and an increase in write-downs associated with axles unsuitable for the remanufacturing program.

Restructuring expense

During 2016, we recorded a restructuring charge of $1.8 million related to employee severance and termination benefits. This action was taken in response to changing market conditions.

Loss on modification and extinguishment of debt and capital lease obligations

Loss on modification and extinguishment of debt and capital lease obligations was $7.5 million for the year ended December 31, 2016 compared to $19.9 million for the year ended December 31, 2015, a decrease of $12.4 million or 62%. In August and December 2016, the Company redeemed $80.0 million and $25.0 million, respectively, in aggregate principal amount of our outstanding Notes. The Notes were called at a redemption price equal to 105.500 percent of the principal amount resulting in a redemption premium of $5.8 million. Additionally, $1.5 million of previously deferred financing fees related to the Notes was expensed as a result of this redemption. This compares to the August 2015 redemption of $150.0 million in aggregate principal amount of our outstanding Notes, which were called at a redemption price equal to 108.250 percent of the principal amount resulting in a redemption premium of $12.4 million. Additionally, approximately $3.1 million of previously deferred financing fees related to the Notes were expensed as a result of the August 2015 redemption.

Also, during 2015 we amended our ABL Facility, which, among other changes, served to increase our revolving credit commitment from $1.25 billion to $1.5 billion. Additionally, we entered into an incremental facility amendment to the Credit Agreement whereby we obtained additional commitments from certain lenders under the ABL Facility, as well as reduced commitments from others. As a result of such amendments, we wrote-off approximately $3.5 million of previously deferred financing fees in accordance with FASB ASC Topic 470-50, Modifications and Extinguishments of Debt.

The remaining decrease was primarily due to the exercise of early purchase options on two capital leases during the year ended December 31, 2016. In accordance with such exercise, we recognized a $0.2 million loss on the extinguishment of debt related to contractual premiums paid and the write-off of previously capitalized costs. Conversely, during 2015, we exercised the early purchase option on two capital lease and recognized a $0.9 million loss on the extinguishment of debt related to contractual premiums paid and the write-off of previously capitalized costs.

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Interest expense

Interest expense was $62.8 million for the year ended December 31, 2016 compared to $80.2 million for the year ended December 31, 2015, a decrease of $17.4 million or 22%. Cash interest decreased $10.8 million, while the non-cash interest portion (consisting of deferred financing fees, amortized losses on terminations of derivative instruments and fair value adjustments for derivative instruments) decreased $6.6 million. The decrease in cash interest expense for the year ended December 31, 2016 was primarily due to a lower effective interest rate during the current year period resulting from the August 2015 and August 2016 refinancing of $150.0 million and $80.0 million, respectively, aggregate principal amount of 11% Senior Secured Notes with proceeds drawn under our ABL Facility which had a weighted-average interest rate for the year ended December 31, 2016 of 2.75%.

Other income, net

Other income, net for the year ended December 31, 2016 was $1.6 million compared to $1.4 million for the year ended December 31, 2015, an increase of $0.2 million.

Provision for income taxes

The effective income tax rates for the years ended December 31, 2016 and 2015 were 35% and 40%, respectively. In both periods, the effective tax rate was adversely impacted by Canadian and Mexican tax provisions. In addition, the effective tax rate for the year ended December 31, 2016 was favorably impacted by a lower state effective tax rate and the recognition of a Research & Development tax credit on the Project Helix costs.

Net income

Net income was $19.9 million for the year ended December 31, 2016 compared to a net income of $26.7 million for the year ended December 31, 2015. The decrease in the net income was attributable to the items noted above.

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2015 versus 2014

Comparison of our consolidated results for the year ended December 31, 2015 to the year ended December 31, 2014

	Year ended December 31,						Variance
	2015			2014			$ change			% change
Revenues:
Equipment leasing revenue	$	661,247		$	588,287		$	72,960			12
Finance revenue		1,536			2,111			(575	)		(27	)
Other revenue		28,641			36,590			(7,949	)		(22	)

Total revenues	$	691,424		$	626,988		$	64,436			10

Expenses:
Direct operating expenses		377,715			333,135			44,580			13
Selling, general and administrative expenses		91,279			84,346			6,933			8
Depreciation expense		72,128			72,114			14			—
(Recovery) provision for doubtful accounts		(258	)		14,007			(14,265	)		(102	)
Impairment of leasing equipment		7,277			5,855			1,422			24
Early retirement of leasing equipment		—			37,766			(37,766	)			**
Loss on modification and extinguishment of debt and capital lease obligations		19,852			315			19,537				**
Interest expense		80,246			86,837			(6,591	)		(8	)
Interest income		(19	)		(61	)		42			(69	)
Other income, net		(1,394	)		(925	)		(469	)		51

Total expenses		646,826			633,389			13,437			2

Income (loss) before provision (benefit) for income taxes		44,598			(6,401	)		50,999				**
Provision (benefit) for income taxes		17,880			(3,445	)		21,325				**

Net income (loss)	$	26,718		$	(2,956	)	$	29,674				**

Adjusted net income(1)	$	55,382		$	35,510		$	19,872			56

Adjusted EBITDA(1)	$	227,228		$	200,932		$	26,296			13

**Not meaningful (1)For a reconciliation of Adjusted ~~net income and Adjusted~~ EBITDA to the most directly comparable U.S. GAAP measures, see "Non-GAAP Measures".

Revenues

Total Company revenue was $691.4 million for the year ended December 31, 2015 compared to $627.0 million for the year ended December 31, 2014, an increase of $64.4 million or 10%.

Equipment leasing revenue was $661.2 million for the year ended December 31, 2015 compared to $588.3 million for the year ended December 31, 2014, an increase of $72.9 million or 12%. This increase was primarily the result of a 9% increase in average per diem rates, which resulted in an increase in equipment leasing revenue of $55.9 million, and an increase in the average on-hire fleet of approximately 7,300 chassis, or 3%, which led to an increase in equipment leasing revenue of $17.0 million.

The increase in average per diem rates was primarily due to a product mix shift away from term leasing to pool arrangements, where the per diem rates are significantly higher. We are also able to charge a higher rate to motor carriers as shipping lines transition from providing chassis as part of their

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~~charge a higher rate to motor carriers as shipping lines transition from providing chassis as part of their~~ transportation-related services. We have also benefited from negotiated rate increases to motor carrier, shipping line, railroad and intermodal logistics customers. The increase in the average on-hire fleet was primarily due to growth in the marine pools, partially offset by a reduced number of chassis on-hire under long-term leases. Growth in our marine pools was due to the Company's purchase of 2,022 chassis from our shipping line customers from January 1, 2015 through December 31, 2015 as well as a shift of 1,361 term lease units into our pools over the same period. The purchases of shipping line chassis has slowed considerably as most shipping lines have either divested their chassis fleets or announced their intentions to retain them. The pace with which chassis have shifted from our term lease product into our pools has also slowed.

Finance revenue was $1.5 million for the year ended December 31, 2015 compared to $2.1 million for the year ended December 31, 2014, a decrease of $0.6 million or 28%. This decrease was primarily the result of a reduction in the average investment in direct finance leases of $5.5 million due to normal amortization through principal payments and maturing lease arrangements.

Other revenue was $28.6 million for the year ended December 31, 2015 compared to $36.6 million for the year ended December 31, 2014, a decrease of $8.0 million or 22%. This decrease was primarily attributable to a $3.6 million reduction in term lease termination fees, a $1.9 million reduction in billings to customers for the repositioning of equipment and a decrease in scrap metal proceeds in connection with the disposal of end-of-life chassis of $1.5 million. The remainder of the decrease was primarily due to a $0.6 million decrease in repair billings to customers and a $0.4 million reduction in fees earned for management services.

Marine Market segment

Total Marine Market segment revenue was $497.3 million for the year ended December 31, 2015 compared to $441.2 million for the year ended December 31, 2014, an increase of $56.1 million or 13%.

	Years Ended December 31,

Key Operating Statistics	2015		2014		Variance			% Change
Marine Market segment
Pool Statistics
Per Diem Revenue	$	444,513	$	380,491	$	64,022			17
Average Total Fleet		149,004		141,463		7,541			5
Average Daily Revenue per Chassis	$	8.17	$	7.37	$	0.80			11
Term Lease Statistics
Per Diem Revenue	$	37,937	$	38,767	$	(830	)		(2	)
Average Total Fleet		33,342		37,836		(4,494	)		(12	)
Average Daily Revenue per Chassis	$	3.12	$	2.81	$	0.31			11

Per Diem Revenue represents revenues billed under operating leases and excludes amounts billed to lessees for maintenance and repair, positioning and handling, and other ancillary charges.

Average Total Fleet is based upon the total fleet at each month end.

56 Equipment leasing revenue was $482.5 million for the year ended December 31, 2015 compared to $419.3 million for the year ended December 31, 2014, an increase of $63.2 million or 15%. Marine pool per diem revenues increased $64.0 million or 17% due to an 11% increase in the average per diem rate and a 5% increase in the average number of chassis in our marine pools. The increased number of chassis in our marine pools is due to the Company's purchase of 2,022 chassis from our shipping line customers from January 1, 2015 through December 31, 2015 as well as a shift of 1,361 term lease units from our term lease product toward our pools, over the same period, as our shipping line customers transition to the motor carrier model. The increase in the average per diem rates in the marine pools

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~~Equipment leasing revenue~~ was ~~$482.5 million for the year ended December 31, 2015 compared to $419.3 million for the year ended~~ December 31, 2014, an increase of $63.2 million or 15%. Marine pool per diem revenues increased $64.0 million or 17% due to an 11% increase in the average per diem rate and a 5% increase in the average number of chassis in our marine pools. The increased number of chassis in our marine pools is due to the Company's purchase of 2,022 chassis from our shipping line customers from January 1, 2015 through December 31, 2015 as well as a shift of 1,361 term lease units from our term lease product toward our pools, over the same period, as our shipping line customers transition to the motor carrier model. The increase in the average per diem rates in the marine pools was primarily due to a favorable mix of higher per diem rates and per diem rate increases billed to motor carriers, along with negotiated per diem rate increases to shipping line customers. Marine pool per diem revenues attributable to motor carriers rose to 54% of total marine pool per diem revenue for the year ended December 31, 2015 from 51% for the year ended December 31, 2014. Marine segment term lease revenues decreased $0.8 million or 2% due to the full year impact of a 12% decrease in the average number of chassis on-hire, the vast majority of which represented transfers to the marine pool during 2014. This decrease was partially offset by an 11% increase in the average per diem rates.

Other revenue was $13.3 million for the year ended December 31, 2015 compared to $19.8 million for the year ended December 31, 2014, a decrease of $6.5 million or 33%. This decrease was primarily attributable to a $4.3 million reduction in term lease termination fees, a $1.7 million reduction in billings to customers for the repositioning of equipment and a $0.3 million reduction in repair billings to customers. The remainder of the decrease was primarily due to a $0.2 million reduction in fees earned for management services.

Domestic Market segment

Total Domestic Market segment revenue was $187.4 million for the year ended December 31, 2015 compared to $178.6 million for the year ended December 31, 2014, an increase of $8.8 million or 5%.

	Years Ended December 31,

Key Operating Statistics	2015		2014			Variance			% Change
Domestic Market segment
Pool Statistics
Per Diem Revenue	$	162,837	$	151,716		$	11,121			7
Average Total Fleet		65,930		61,483			4,447			7
Average Daily Revenue per Chassis	$	6.77	$	6.76		$	0.01			—
Term Lease Statistics
Per Diem Revenue	$	15,959	$	17,313		$	(1,354	)		(8	)
Average Total Fleet		12,375		12,528			(153	)		(1	)
Average Daily Revenue per Chassis (*excluding early termination revenue)	$	3.53	$	3.54	*	$	(0.01	)		—

Per Diem Revenue represents revenues billed under operating leases and excludes amounts billed to lessees for maintenance and repair, positioning and handling, and other ancillary charges.

Average Total Fleet is based upon the total fleet at each month end.

Equipment leasing revenue was $178.8 million for the year ended December 31, 2015 compared to $169.0 million for the year ended December 31, 2014, an increase of $9.8 million or 6%. Domestic pool per diem revenues increased $11.1 million or 7% due to a 7% increase in the average number of chassis in our domestic pools. Domestic pool term lease revenues decreased $1.3 million or 8% primarily due to early termination revenue associated with an expiring term lease recognized during the comparable prior year period, as well as a 1% decrease in the average number of chassis on-hire.

57 Other revenue was $8.5 million for the year ended December 31, 2015 compared to $9.6 million for the year ended December 31, 2014, a decrease of $1.1 million or 11%. This decrease was primarily attributable to a $0.6 million reduction in billings to customers for the repositioning of equipment, a

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~~per diem revenues increased~~ $110.13 million decrease orin 7%repair ~~due~~billings to acustomers 7%and ~~increase~~a ~~in the average number of chassis in our domestic pools. Domestic pool term lease revenues decreased~~ $10.32 million ~~or 8%~~reduction ~~primarily due to early termination revenue associated with an expiring term lease recognized during the comparable prior year period, as well as a 1% decrease~~ in ~~the~~fees ~~average~~earned ~~number~~for ofmanagement ~~chassis on-hire~~services.

Other revenue was $8.5 million for the year ended December 31, 2015 compared to $9.6 million for the year ended December 31, 2014, a decrease of $1.1 million or 11%. This decrease was primarily attributable to a $0.6 million reduction in billings to customers for the repositioning of equipment, a $0.3 million decrease in repair billings to customers and a $0.2 million reduction in fees earned for management services.

Direct operating expenses

Total Company direct operating expenses were $377.7 million for the year ended December 31, 2015 compared to $333.1 million for the year ended December 31, 2014, an increase of $44.6 million or 13%. Maintenance and repair expenses within our Marine and Domestic Market Segments increased $36.0 million or 16%, which was primarily due to a higher average cost per repair, as well as a 6% increase in the average number of chassis operating in marine and domestic chassis pools. The increase in the average cost per repair within the Marine Market segment was driven primarily by an increase in chassis operating and being repaired in higher labor rate regions. Maintenance and repair expenses for chassis residing at third party depots and at the Company's service centers increased $3.8 million during the year ended December 31, 2015 versus the comparable period of 2014. Additionally, increasing customer demand in chassis pools and the associated costs of placing equipment on-hire resulted in an increase in repositioning and handling expenses of $2.4 million, incremental chassis usage fees of $1.7 million and an increase in pool operational expense of $0.7 million.

Marine Market segment

Direct operating expenses for the Marine Market segment were $293.9 million for the year ended December 31, 2015 compared to $252.7 million for the year ended December 31, 2014, reflecting an increase of $41.2 million or 16%. Maintenance and repair expenses increased $36.8 million or 20%, which was primarily due to a higher average cost per repair driven primarily by an increase in chassis operating and being repaired in higher labor rate regions, as well as a 5% increase in the average number of chassis operating in marine pools. Additionally, increasing customer demand in chassis pools and the associated costs of placing equipment on-hire resulted in incremental chassis usage fees of $1.7 million, an increase in repositioning and handling expenses of $1.3 million and an increase in pool operational expense of $0.7 million. Other direct operating expenses such as storage and licensing costs increased by $0.7 million.

Domestic Market segment

Direct operating expenses for the Domestic Market segment were $61.8 million for both years ended December 31, 2015 and 2014. Although direct operating expenses were $61.8 million in both years, the components varied. Maintenance and repair expenses decreased $0.8 million or 2% for the year ended December 31, 2015, despite a 7% increase in the average number of chassis operating in domestic pools. We experienced a lower average cost per repair and lower frequency of repair per pooled chassis utilized during the year ended December 31, 2015 versus the comparable period of 2014. This decrease was partially offset by increasing customer demand in chassis pools which has resulted in an increase in repositioning and handling expenses of $0.6 million. Other direct operating expenses such as licensing costs increased by $0.2 million.

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Revenues and Adjusted EBITDA by segment

	Revenues							Adjusted EBITDA

Consolidated Statement of Operations Data:	Year Ended Dec 30, 2015		Year Ended Dec 30, 2014		Variance			Year Ended Dec 30, 2015			Year Ended Dec 30, 2014			Variance
Marine Market segment	$	497,268	$	441,201	$	56,067		$	150,934		$	127,779		$	23,155
Domestic Market segment		187,387		178,644		8,743			107,305			99,313			7,992

Total Reportable segments	$	684,655	$	619,845	$	64,810		$	258,239		$	227,092		$	31,147
Other		6,769		7,143		(374	)		(31,011	)		(26,160	)		(4,851	)

Total Company	$	691,424	$	626,988	$	64,436		$	227,228		$	200,932		$	26,296



Principal collections on direct finance leases									(3,665	)		(4,622	)
Non-cash share-based compensation									(625	)		(810	)
Depreciation expense									(72,128	)		(72,114	)
Impairment of leasing equipment									(7,277	)		(5,855	)
Early retirement of leasing equipment									—			(37,766	)
Loss on modification and extinguishment of debt and capital lease obligations									(19,852	)		(315	)
Interest expense									(80,246	)		(86,837	)
Other income, net									1,144			925
Interest income									19			61

Income (loss) before provision (benefit) for income taxes									44,598			(6,401	)
Provision (benefit) for income taxes									17,880			(3,445	)

Net income (loss)								$	26,718		$	(2,956	)

Selling, general and administrative expenses

Selling, general and administrative expenses were $91.3 million for the year ended December 31, 2015 compared to $84.3 million for the year ended December 31, 2014, an increase of $7.0 million or 8%. This increase was primarily due to incremental employee-related costs resulting from headcount additions in support of operational cost containment initiatives, including in-sourcing depot operations at select locations. Also contributing to this increase were consulting fees in support of information technology, operational and human resource initiatives and the costs associated with our relocation to a new corporate headquarters location during May 2015. These increases were partially offset by the capitalization of compensation and related benefit costs for employees directly associated with the development of our new operating and financial reporting systems ("Project Helix").

Depreciation expense

We recorded depreciation expense of $72.1 million for each of the years ended December 31, 2015 and 2014. Although depreciation expense was $72.1 million in both years, the components varied. During 2015, we experienced incremental depreciation expense resulting from chassis acquired since January 1, 2015 and the addition of remanufactured chassis to our domestic pool. The aforementioned chassis acquisitions were related to marine chassis purchased from the shipping lines as they continue to migrate to the motor carrier model and the purchase of previously leased-in domestic chassis to support the growth in the domestic pool. These increases are offset by the absence of accelerated depreciation expense recorded in the third quarter of 2014 on the Company's former headquarters in

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Princeton, New Jersey resulting from a sale agreement entered into on August 1, 2014, as well as reductions in depreciation expense resulting from the change in the estimated useful life of 53' domestic chassis from 17.5 years to 20 years effective April 1, 2014, and the early retirement of certain marine chassis as of April 1, 2014. Retiring such chassis eliminated the need to depreciate them subsequently.

(Recovery) provision for doubtful accounts

During the year ended December 31, 2015, the provision for doubtful accounts decreased by $14.3 million compared to the prior year period primarily due to an improved collection experience with our motor carriers.

Impairment of leasing equipment

We recorded impairment charges on leasing equipment of $7.3 million for the year ended December 31, 2015 compared to $5.9 million for the year ended December 31, 2014, an increase of $1.4 million. This increase was primarily due to estimated provisions associated with axle sets anticipated to be unsuitable for the remanufacturing program and estimated shrinkage of certain chassis within our marine pools.

Early retirement of leasing equipment

During the second quarter of 2014, we recorded retirement charges of $37.8 million associated with the retirement of excess and non-standard chassis and axle sets. Approximately $14.8 million of this retirement charge was the result of 11,000 excess and other non-standard chassis residing at depots and chassis pools, in addition to approximately 9,000 axle sets residing at depots which resulted in a retirement charge of $23.0 million. These retirement charges were largely influenced by our successful award of several shipping line acquisitions during the second quarter of 2014 whereby over 23,000 marine chassis were either acquired or returned to us from shipping lines. The influx of marine chassis caused us to analyze our fleet requirements over a multi-year period taking into account forecasted market growth, the current performance of our marine pools and utilization requirements among other factors which ultimately influenced our decision to early retire certain chassis and axle sets. The total of the retirement charges of $37.8 million is recorded in Early retirement of leasing equipment in the Consolidated Statements of Operations for the year ended December 31, 2014.

Loss on modification and extinguishment of debt and capital lease obligations

Loss on modification or extinguishment of debt and capital lease obligations was $19.9 million for the year ended December 31, 2015 compared to $0.3 million for the year ended December 31, 2014, an increase of $19.6 million.

This increase was primarily due to the August 2015 redemption of $150.0 million in aggregate principal amount of our outstanding ~~11.0% Senior Secured~~ Notes ~~("Notes")~~. The Notes were called at a redemption price equal to 108.25 percent of the principal amount resulting in a redemption premium of $12.4 million. Additionally, approximately $3.1 million of previously deferred financing fees related to these Notes was expensed as a result of this redemption.

Also, during 2015 we amended our ABL Facility, which, among other changes, served to increase our revolving credit commitment from $1.25 billion to $1.5 billion. As a result of such amendments, we wrote-off approximately $3.5 million of previously deferred financing fees in accordance with FASB ASC Topic 470-50, Modifications and Extinguishments of Debt.

The remaining increase was primarily due to the exercise of early purchase options on two capital leases during the year ended December 31, 2015. In accordance with such exercise, we recognized a

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$0.9 million loss on the extinguishment of debt related to contractual premiums paid and the write-off of previously capitalized costs. Conversely, during 2014, we exercised the early purchase option on one capital lease and recognized a $0.2 million loss on the extinguishment of debt related to contractual premiums paid and the write-off of previously capitalized costs.

Interest expense

Interest expense was $80.2 million for the year ended December 31, 2015 compared to $86.8 million for the year ~~ended~~ ended December 31, 2014, a decrease of $6.6 million or 8%. Cash interest decreased $8.1 million, while the non-cash interest portion (consisting of deferred financing fees, ~~amortized~~ amortized losses on terminations of derivative instruments and fair value adjustments for derivative instruments) increased $1.5 million. The decrease in cash interest expense for the year ~~ended~~ ended December 31, 2015 was primarily due to a lower interest rate in effect during the year which resulted from the refinancing of $150.0 million aggregate principal amount of ~~11% Senior~~our ~~Secured~~ Notes with proceeds drawn under our ABL Facility which had a weighted-average interest rate for 2015 of 3.51% and lower average debt levels.

Other income, net

Other income, net for the year ended December 31, 2015 was $1.4 million compared to $0.9 million for the year ended December 31, 2014, an increase of $0.5 million. The increase was primarily due to incremental gains associated with the disposition of equipment recorded during the current year period.

Provision (benefit) for income taxes

The effective income tax rates for the years ended December 31, 2015 and 2014 were 40% and 54%, respectively. In both periods, the effective tax rate was adversely impacted by Canadian and Mexican tax provisions.

Net income (loss)

Net income was $26.7 million for the year ended December 31, 2015 compared to a net loss of $3.0 million for the year ended December 31, 2014. The increase in the net income was attributable to the items noted above.

61 Liquidity and capital resources

~~Table~~ We ofhave ~~Contents~~historically met our liquidity requirements primarily from revenues from operating activities from our subsidiaries, asset based lending facilities, leases and second lien borrowings.

Revenues from operating activities include term lease and marine and domestic pool revenues, direct finance lease collections, emergency road service billings and billings to lessees for maintenance and repair, repositioning and management fees. Cash flow provided by operating activities was $151.1 million, $181.3 million and $138.5 million for the years ended December 31, 2016, 2015 and 2014, ~~versus~~respectively. ~~2013~~

Amounts ~~Comparison~~outstanding under existing borrowing facilities were $1.10 billion as of ~~our~~December 31, ~~consolidated~~2016, ~~results~~$1.08 billion ~~for~~as ~~the~~of ~~year~~December 31, ~~ended~~2015 and $1.16 billion as of December 31, 2014. As of December 31, 2016, we had $1,032.0 million outstanding under the ABL Facility and excess availability of $203.0 million. No other amounts are available to draw under other currently available borrowing facilities. Our ability to draw the ~~year~~excess availability could be limited in the future by testing of financial ~~ended~~covenants and other ABL Facility limiters depending on the use of drawn funds. As of December 31, ~~2013~~ 2016, we were in compliance with all financial covenants as defined under the indenture, the ABL

	Year ended December 31,						Variance
	2014			2013			$ change			% change
Revenues:
Equipment leasing revenue	$	588,287		$	472,571		$	115,716			24
Finance revenue		2,111			3,254			(1,143	)		(35	)
Other revenue		36,590			39,419			(2,829	)		(7	)

Total revenues	$	626,988		$	515,244		$	111,744			22

Expenses:
Direct operating expenses		333,135			289,767			43,368			15
Selling, general and administrative expenses		84,346			58,031			26,315			45
Depreciation expense		72,114			71,791			323			—
Provision for doubtful accounts		14,007			11,369			2,638			23
Impairment of leasing equipment		5,855			5,857			(2	)		—
Early retirement of leasing equipment		37,766			—			37,766				**
Loss on modification and extinguishment of debt and capital lease obligations		315			904			(589	)		(65	)
Interest expense		86,837			91,085			(4,248	)		(5	)
Interest income		(61	)		(287	)		226			(79	)
Other income, net		(925	)		(2,074	)		1,149			(55	)

Total expenses		633,389			526,443			106,946			20

Loss before (benefit) provision for income taxes		(6,401	)		(11,199	)		4,798			(43	)
(Benefit) provision for income taxes		(3,445	)		18,154			21,599				**

Net loss	$	(2,956	)	$	(29,353	)	$	26,397			(90	)

Adjusted net income(1)	$	35,510		$	9,798		$	25,712				**

Adjusted EBITDA(1)	$	200,932		$	162,964		$	37,968			23

**Not meaningful (1)For a reconciliation of Adjusted net income and Adjusted EBITDA to the most directly comparable U.S. GAAP measures, see "Non-GAAP Measures".

Revenues

Total Company revenue was $627.0 million for the year ended December 31, 2014 compared to $515.2 million for the year ended December 31, 2013, an increase of $111.8 million or 22%.

Equipment leasing revenue was $588.3 million for the year ended December 31, 2014 compared to $472.6 million for the year ended December 31, 2013, an increase of $115.7 million or 24%. This increase was primarily the result of a 20% increase in average per diem rates, which resulted in an increase in equipment leasing revenue of $99.3 million, and an increase in the average on-hire fleet of approximately 8,500 chassis, or 3%, which led to an increase in equipment leasing revenue of $16.4 million.

The increase in average per diem rates is primarily due to a product mix shift away from term leasing to pool arrangements, where the per diem rates are significantly higher. We are also able to

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charge a higher rate to motor carriers as shipping lines transition from providing chassis as part of their transportation-related services. We have also benefited from negotiated rate increases to shipping line, railroad and intermodal logistics customers. The increase in the average on-hire fleet was primarily due to growth in the marine pools, partially offset by a reduced number of chassis on-hire under long-term leases. Growth in our marine pools was due to the Company's purchase of 17,934 chassis from our shipping line customers during 2014 as well as a shift of 12,812 term lease units into our pools over the same period. Such purchases and movements from long-term lease arrangements to pools are consistent with our expectations as the industry shift to the motor carrier model continues to evolve.

Finance revenue was $2.1 million for the year ended December 31, 2014 compared to $3.2 million for the year ended December 31, 2013, a decrease of $1.1 million or 34%. This decrease was primarily the result of a reduction in the average investment in direct finance leases of $11.0 million due to normal amortization through principal payments and assets transitioned to the motor carrier model.

Other revenue was $36.6 million for the year ended December 31, 2014 compared to $39.4 million for the year ended December 31, 2013, a decrease of $2.8 million or 7%. This decrease was primarily attributable to the absence of $2.9 million in fees earned for arranging the sale of managed containers to a third party in 2013, a $2.0 million reduction in term lease termination fees and a $0.6 million reduction in fees earned for management services. These decreases were partially offset by an increase in billings to pool customers for the repositioning of equipment of $1.9 million and higher scrap metal proceeds in connection with the disposal of end-of-life chassis of $0.8 million.

Marine Market segment

Total Marine Market segment revenue was $441.2 million for the year ended December 31, 2014 compared to $345.2 million for the year ended December 31, 2013, an increase of $96.0 million or 28%.

	Year Ended December 31,
Key Operating Statistics	2014		2013		Variance			% Change
Marine Market segment
Pool Statistics
Per Diem Revenue	$	380,491	$	273,391	$	107,100			39
Average Total Fleet		141,463		120,079		21,384			18
Average Daily Revenue per Chassis	$	7.37	$	6.24	$	1.13			18
Term Lease Statistics
Per Diem Revenue	$	38,767	$	45,782	$	(7,015	)		(15	)
Average Total Fleet		37,836		50,890		(13,054	)		(26	)
Average Daily Revenue per Chassis	$	2.81	$	2.46	$	0.35			14

Per Diem Revenue represents revenues billed under operating leases and excludes amounts billed to lessees for maintenance and repair, positioning and handling, and other ancillary charges.

Average Total Fleet is based upon the total fleet at each month end.

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Equipment leasing revenue was $419.3 million for the year ended December 31, 2014 compared to $319.2 million for the year ended December 31, 2013, an increase of $100.1 million or 31%. Marine pool per diem revenues increased $107.1 million or 39% due to an 18% increase in the average number of chassis in our marine pools and an 18% increase in the average per diem rate. The increased number of chassis in our marine pools is due to the Company's purchase of 17,934 chassis from our shipping line customers during 2014 as well as a shift of 12,812 term lease units from our term lease product toward our pools, over the same period, as our shipping line customers transition to the motor carrier model. The increase in the average per diem rates in the marine pools is primarily due to a favorable mix of higher per diem rates billed to motor carriers and negotiated per diem rate increases to shipping line customers. Marine pool per diem revenues attributable to motor carriers rose to 51% of total marine pool per diem revenue for the year ended December 31, 2014 from 44% for the year ended December 31, 2013. Marine term lease revenues decreased $7.0 million or 15% due to a 26% decrease in the average number of chassis on-hire, the vast majority of which represented transfers to the marine pool. This decrease was partially offset by a 14% increase in the average per diem rate.

Other revenue was $19.8 million for the year ended December 31, 2014 compared to $22.8 million during the year ended December 31, 2013, a decrease of $3.0 million or 13%. This decrease was primarily attributable to a $1.8 million reduction in term lease termination fees and a $0.5 million reduction in fees earned for management services. In addition, a decrease in repair billings to customers for damage incurred while the chassis was on lease of $0.4 million and reduced billings to pool customers for the repositioning of equipment of $0.2 million were also contributing factors to the overall decrease.

Domestic Market segment

Total Domestic Market segment revenue was $178.6 million for the year ended December 31, 2014 compared to $160.2 million for the year ended December 31, 2013, an increase of $18.4 million or 11%.

	Year Ended December 31,
Key Operating Statistics	2014			2013		Variance			% Change
Domestic Market segment
Pool Statistics
Per Diem Revenue	$	151,716		$	135,171	$	16,545			12
Average Total Fleet		61,483			59,903		1,580			3
Average Daily Revenue per Chassis	$	6.76		$	6.18	$	0.58			9
Term Lease Statistics
Per Diem Revenue	$	17,313		$	18,227	$	(914	)		(5	)
Average Total Fleet		12,528			13,947		(1,419	)		(10	)
Average Daily Revenue per Chassis (*excluding early termination revenue)	$	3.54	*	$	3.58	$	(0.04	)		(1	)

Per Diem Revenue represents revenues billed under operating leases and excludes amounts billed to lessees for maintenance and repair, positioning and handling, and other ancillary charges.

Average Total Fleet is based upon the total fleet at each month end.

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Equipment leasing revenue was $169.0 million for the year ended December 31, 2014 compared to $153.4 million for the year ended December 31, 2013, an increase of $15.6 million or 10%. Domestic pool revenues increased $16.5 million or 12% due to a 9% increase in the average per diem rates and a 3% increase in the average number of chassis in our domestic pools. The increase in the average per diem rates in the domestic pool was due to higher utilization of our fleet along with negotiated per diem rate increases with railroad and intermodal logistic customers. Domestic term lease revenues decreased $0.9 million or 5%. This decrease was primarily attributable to a 10% decrease in the average number of chassis on-hire resulting from the sale of domestic chassis by the Company which were on an expiring term lease, partially offset by the recognition of early termination revenue during the current year period.

Other revenue was $9.6 million for the year ended December 31, 2014 compared to $6.8 million for the year ended December 31, 2013, an increase of $2.8 million or 41%. This increase was primarily attributable to increases in billings to rebalance our pools of $2.9 million.

Direct operating expenses

Total Company direct operating expenses were $333.1 million for the year ended December 31, 2014 compared to $289.8 million for the year ended December 31, 2013, an increase of $43.3 million or 15%. Maintenance and repair expenses increased $37.4 million or 18%, which was primarily due to a 13% increase in the average number of chassis operating in marine and domestic chassis pools. In addition, we experienced a 5% increase in the average cost per repair, partially offset by a lower frequency of repairs in our marine neutral pools and our domestic pool during the year ended December 31, 2014 versus the comparable period of 2013. Additionally, increasing customer demand in chassis pools and the associated costs of placing equipment on-hire resulted in an increase in repositioning and handling expenses of $2.5 million and an increase in pool operational expense of $2.8 million. Other direct operating expenses such as chassis usage fees, licensing expense and storage costs contributed to the remaining increase of $0.6 million.

Marine Market segment

Direct operating expenses for the Marine Market segment were $252.7 million for the year ended December 31, 2014 compared to $206.6 million for the year ended December 31, 2013, reflecting an increase of $46.1 million or 22%. Maintenance and repair expenses increased $39.7 million or 27%, primarily due to an 18% increase in the average number of chassis operating in our marine pools. In addition, we experienced an 8% increase in the average cost per repair, partially offset by a lower frequency of repairs in our marine neutral pools during the year ended December 31, 2014 versus the comparable period of 2013. Additionally, increasing customer demand in chassis pools and the associated costs of placing equipment on-hire resulted in an increase in repositioning and handling expense of $2.7 million and an increase in pool operational expense of $2.8 million. Other direct operating expenses such as chassis usage fees, licensing expense and storage costs contributed to the remaining increase of $0.9 million.

Domestic Market segment

Direct operating expenses for the Domestic Market segment were $61.8 million for the year ended December 31, 2014 compared to $67.1 million for the year ended December 31, 2013, reflecting a decrease of $5.3 million or 8%. Maintenance and repair expenses decreased $5.9 million or 12%. We experienced a lower average cost per repair and lower frequency of repair per pooled chassis utilized during the year ended December 31, 2014 versus the comparable period of 2013. This decrease is partially offset by an increase in chassis usage fees $0.8 million. Additionally, there was a decrease of $0.2 million in other direct operating expenses.

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Revenues and Adjusted EBITDA by segment

	Revenues							Adjusted EBITDA
	Year Ended Dec 31, 2014		Year Ended Dec 31, 2013		Variance			Year Ended Dec 31, 2014			Year Ended Dec 31, 2013			Variance
Consolidated Statement of Operations Data:
Marine Market segment	$	441,201	$	345,163	$	96,038		$	127,779		$	96,731		$	31,048
Domestic Market segment		178,644		160,250		18,394			99,313			79,410			19,903

Total Reportable segments	$	619,845	$	505,413	$	114,432		$	227,092		$	176,141		$	50,951
Other		7,143		9,831		(2,688	)		(26,160	)		(13,177	)		(12,983	)

Total Company	$	626,988	$	515,244	$	111,744		$	200,932		$	162,964		$	37,968



Principal collections on direct finance leases									(4,622	)		(5,706	)
Non-cash share-based compensation									(810	)		(1,181	)
Depreciation expense									(72,114	)		(71,791	)
Impairment of leasing equipment									(5,855	)		(5,857	)
Early retirement of leasing equipment									(37,766	)		—
Loss on modification and extinguishment of debt and capital lease obligations									(315	)		(904	)
Interest expense									(86,837	)		(91,085	)
Other income									925			2,074
Interest income									61			287

Loss before (benefit) provision for income taxes									(6,401	)		(11,199	)

(Benefit) provision for income taxes									(3,445	)		18,154

Net loss								$	(2,956	)	$	(29,353	)

Selling, general and administrative expenses

Selling, general and administrative expenses were $84.3 million for the year ended December 31, 2014 compared to $58.0 million for the year ended December 31, 2013, an increase of $26.3 million or 45%. This increase was primarily due to incremental employee-related costs resulting from headcount additions in support of the industry shift to the motor carrier model, higher incentive-based compensation driven primarily by Company performance and consulting fees in support of information technology, operational and human resource initiatives.

Depreciation expense

Depreciation expense was $72.1 million for the year ended December 31, 2014 compared to $71.8 million for the year ended December 31, 2013, an increase of $0.3 million. This increase was primarily due to incremental depreciation expense resulting from chassis acquired since January 1, 2014, as well as incremental depreciation expense taken on the Company's existing headquarters in Princeton, New Jersey resulting from a sale agreement entered into on August 1, 2014. At the same time, the Company has entered into a lease agreement to house its future headquarters, also in Princeton, New Jersey, currently estimated for occupancy during the second quarter of 2015. The aforementioned chassis acquisitions were related to marine chassis purchased from the shipping lines as they continue to migrate to the motor carrier model and the purchase of previously leased-in domestic chassis to support the growth in the domestic pool. These increases are partially offset by reductions in

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depreciation expense resulting from the change in the estimated useful life of 53' domestic chassis from 17.5 years to 20 years effective April 1, 2014. Also contributing to the decrease in depreciation expense was the early retirement of certain marine chassis as of April 1, 2014. Retiring such chassis eliminated the need to depreciate them subsequently.

Provision for doubtful accounts

The provision for doubtful accounts was $14.0 million for the year ended December 31, 2014 compared to $11.4 million for the year ended December 31, 2013, an increase of $2.6 million. The increase was primarily attributable to a more diversified customer base which includes a larger population of motor carriers as shipping lines continue to migrate to the motor carrier model. As a result, we are providing a greater number of chassis directly to motor carriers, thereby increasing credit risk.

Impairment of leasing equipment

We recorded impairment charges on leasing equipment of $5.9 million for each of the years ended December 31, 2014 and 2013. Although the total impairment charge was $5.9 million in both years, the components varied. During 2014, we experienced a reduction in the number of end-of-life chassis impaired as compared to 2013. We also experienced an increase in 2014 over 2013 in write-downs associated with chassis and axle sets determined to be unsuitable for the remanufacturing program.

Early retirement of leasing equipment

During the second quarter of 2014, we recorded retirement charges of $37.8 million associated with the retirement of excess and non-standard chassis and axle sets. Approximately $14.8 million of this retirement charge was the result of 11,000 excess and other non-standard chassis residing at depots and chassis pools, in addition to approximately 9,000 axle sets residing at depots which resulted in a retirement charge of $23.0 million. These retirement charges were largely influenced by our successful award of several shipping line acquisitions during the second quarter whereby over 23,000 marine chassis were either acquired or returned to us from shipping lines. The influx of marine chassis caused us to analyze our fleet requirements over a multi-year period taking into account forecasted market growth, the current performance of our marine pools and utilization requirements among other factors which ultimately influenced our decision to early retire certain chassis and axle sets. The total of the above retirement charges of $37.8 million is recorded in Early retirement of leasing equipment in the Consolidated Statements of Operations.

Loss on modification and extinguishment of debt and capital lease obligations

The loss on modification and extinguishment of debt and capital lease obligations was $0.3 million for year ended December 31, 2014 compared to $0.9 million for the year ended December 31, 2013, a decrease of $0.6 million. This decrease was primarily due to the exercise of early purchase options on three capital leases during the year ended December 31, 2013. In accordance with such exercise, we recognized a $0.8 million loss on the extinguishment of debt related to contractual premiums paid and the write-off of previously capitalized costs. Conversely, during 2014, we exercised the early purchase option on one capital lease and recognized a $0.2 million loss on the extinguishment of debt related to contractual premiums paid and the write-off of previously capitalized costs.

Interest expense

Interest expense was $86.8 million for the year ended December 31, 2014 compared to $91.1 million for the year ended December 31, 2013, a decrease of $4.3 million or 5%. The non-cash interest portion of this decrease (consisting of deferred financing fees, amortized losses on terminations

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ofFacility ~~derivative instruments~~ and ~~fair~~other ~~value adjustments for derivative instruments) amounted to $1~~agreements.~~1 million,~~ ~~while~~We ~~the~~believe ~~cash~~that ~~interest~~we ~~portion~~will ~~resulted~~be inable ~~a decrease amounting~~ to ~~$3.2 million.~~ ~~The~~continue ~~decrease in non-cash interest expense was primarily due~~ to amaintain ~~$1.7 million~~compliance ~~decrease~~with inall ~~the~~applicable ~~amortization~~covenants of deferred mark-to-market losses on terminated interest rate swap agreements, partially offset by a $0.6 million increase in the amortization of deferred financing fees. The decrease in cash interest expense for the ~~year~~next ~~ended December~~12 ~~31, 2014 was primarily due to a reduction in the weighted-average interest rate from 5~~months.~~60%~~ ~~during~~See ~~2013 to 5.26% during 2014, which accounted for a $4.0 million decrease in cash interest expense. The~~"Risk ~~decrease~~factors—Our in the weighted-average interest rate was due to an amendment to the ABL Facility whereby the interest rate on the ABL Facility was decreased to LIBOR plus 2.25% from LIBOR plus 2.75%. Partially offsetting this decrease was a $14.6 million increase in the average balance of debt ~~outstanding~~agreements ~~during~~contain ~~2014~~restrictions ~~which~~that ~~yielded~~limit ~~incremental~~our ~~cash~~flexibility ~~interest expense of $0.8 million. The increase~~ in ~~the~~operating ~~average debt outstanding was primarily due to additional borrowings to support the growth of~~ our ~~chassis pool operation and related fleet~~business."

Other ~~income, net~~Considerations

~~Other~~On ~~income~~January 14, ~~net for year ended December 31~~2016, ~~2014~~we ~~was~~borrowed $051.90 million ~~compared~~(the to"Borrowing") ~~$2.1 million~~under ~~for~~ the ~~year~~revolving ~~ended December 31,~~credit ~~2013,~~facility aof ~~decrease~~the ofABL $1Facility.~~2 million.~~ The Borrowing ~~decrease~~ was ~~primarily~~used ~~due~~ to finance the repurchase and retirement of 62 shares, par value $10.~~1 million~~01 ~~gain~~per ~~associated~~share, ~~with~~of the ~~disposition~~common stock of ~~domestic~~Interpool, Inc. ~~containers~~held ~~during~~by the ~~prior~~Company, ~~year period and~~ the ~~reversal~~sole shareholder of Interpool, Inc., aat ~~residual~~an ~~value~~aggregate ~~liability~~purchase ~~related~~price toof approximately $51.0 million (the ~~sale~~"Repurchase ofAmount"). ~~managed~~Through ~~domestic~~a ~~containers~~successive ~~recorded~~chain ~~during~~of dividends, the ~~prior~~Repurchase ~~year~~Amount ~~period.~~was ~~These~~received ~~decreases~~pro rata ~~were~~by ~~partially~~our ~~offset~~indirect byshareholders ~~the~~of ~~gain~~record, ~~on sale~~including ~~associated~~certain ~~with~~private ~~domestic~~equity ~~chassis~~funds onthat are managed by an ~~expiring~~affiliate ~~term~~of ~~lease~~Fortress ~~which~~Investment ~~was~~Group LLC, ~~recorded~~employees ~~during~~of ~~the~~affiliates ~~current~~of Seacastle Inc. ~~year~~(our ~~period~~indirect parent) and members of management.

On August 15, 2016, we borrowed $80.0 million under our ABL Facility which carries an interest rate of one-month LIBOR + 2.00% and matures on December 10, 2020, which is the maturity date of the ABL Facility. The funds were used to finance the redemption of $80.0 million in aggregate principal amount of our outstanding Notes at a redemption price equal to 105.500 percent of such aggregate principal amount. Approximately $84.4 million was paid to redeem the Notes, $80.0 million aggregate principal ~~(Benefit)~~amount ~~provision~~and ~~for~~a ~~income~~premium ~~taxes~~ of $4.4 million. Additionally, $1.2 million of deferred financing fees related to the Notes were expensed upon redemption.

~~The effective income tax rates for the years ended~~ On December 3128, ~~2014~~2016, ~~and~~we ~~2013~~borrowed ~~were 54% and (162%), respectively~~$25.0 million ~~The~~under ~~effective tax~~our ~~rate~~ABL ~~was~~Facility ~~adversely~~which ~~impacted~~carries byan ~~Canadian~~interest ~~and~~rate ~~Mexican tax provisions~~ of ~~$0.2~~one-month LIBOR ~~million~~+ 2.00% and ~~$1.0 million~~matures ~~for the years ended~~ on December 3110, ~~2014 and 2013~~2020, ~~respectively.~~which Inis ~~addition, for~~ the ~~year~~maturity ~~ended~~date ~~December 31,~~of ~~2014~~ the ~~effective~~ABL ~~tax~~Facility. ~~rate~~The ~~was~~funds ~~adversely~~were ~~impacted~~used byto afinance the redemption of $025.40 million ~~increase~~ in anaggregate ~~uncertain~~principal ~~state~~amount ~~tax~~of ~~position~~our ~~and~~outstanding ~~for~~Notes at ~~the~~a ~~year~~redemption ~~ended December 31,~~price ~~2013~~equal ~~the~~to ~~effective~~105.500 percent ~~tax~~of ~~rate~~such ~~was~~aggregate ~~adversely~~principal ~~impacted~~amount. byApproximately a $5626.14 million ~~gain~~was ~~recognized~~paid ~~from the~~to ~~distribution~~redeem ofthe ~~stock~~Notes, in$25.0 million aaggregate ~~related~~principal amount ~~company.~~and ~~The~~a ~~gain~~premium ~~created~~of ~~net~~$1.4 million. ~~taxable~~Additionally, ~~income~~$0.3 million inof ~~2013~~deferred ~~which~~financing ~~was~~fees ~~fully~~related ~~offset~~to ~~for~~the ~~regular~~Notes ~~tax~~were ~~purposes~~expensed ~~with~~upon ~~NOLs~~redemption. ~~Excluding~~As ~~the~~of ~~tax~~December 31, ~~related to the~~2016, $5645.10 million ~~gain,~~aggregate ~~the~~principal ~~effective~~amount ~~tax~~of ~~rate~~Notes ~~for~~remains ~~2013 would have been (35%)~~outstanding.

On February 27, 2017, we borrowed $19.0 million under our ABL Facility to partially finance the redemption of an additional $25.0 million in aggregate principal amount of our Notes. See Note 20 "Subsequent Events" to our Consolidated Financial Statements. Furthermore, on an ongoing basis, we will evaluate and consider redeeming the remainder of our ~~Net~~outstanding ~~loss~~ Notes, which would require cash expenditures and may be funded through a combination of cash on hand or further borrowing under our ABL Facility.

~~Net~~As of ~~loss~~December 31, ~~was~~2016, we have approximately $39.02 million ~~for~~of ~~the~~scheduled ~~year~~debt ~~ended~~amortization ~~December~~throughout 2017. This amount does not include $33.5 31million of interest payments, ~~2014~~$25.5 million ~~compared~~of toasset aand ~~net~~tire ~~loss~~purchase ofcommitments and $2911.49 million ~~for~~of ~~the year~~operating ~~ended~~lease commitments existing as of December 31, ~~2013~~2016 and maturing over the next 12 months. ~~The~~We ~~decrease~~expect inthat cash flows from operations, principal collections on direct finance leases and amounts available to us under our ABL Facility will be sufficient to meet our liquidity needs for 2017, funding maturing debt and satisfying our contractual obligations. However, we may need to borrow funds to finance the ~~net~~purchases ~~loss~~of ~~was~~new ~~attributable~~and used assets or to remanufacture assets to expand the ~~items~~business. ~~noted~~No ~~above~~assurance can be made that we will be able to meet our financing and other liquidity needs as currently contemplated. See "Risk factors—Our inability to service our debt obligations or to obtain additional financing as needed would have a material adverse effect on our business, financial condition and results of operations."

Historically, ~~Liquidity~~the Company has had the ability to service debt obligations and ~~capital~~to ~~resources~~ obtain additional financing as needed by the business. The majority of our debt is secured by long-lived assets which

We have historically met our liquidity requirements primarily from revenues from operating activities from our subsidiaries, lines of credit and other secured and unsecured borrowings.

Revenues from operating activities include term lease and marine and domestic pool revenues, direct finance lease collections and billings to lessees for maintenance and repair, and billings to lessees for repositioning and management fees. Cash flow provided by operating activities was $181.3 million, $138.5 million and $66.8 million for the years ended December 31, 2015, 2014 and 2013, respectively.

On August 11, 2015 and subsequently on December 10, 2015, we entered into amendments and incremental facility amendments to our ABL Facility. See "Borrowings-Amendments to ABL Facility

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~~2015"~~have inproven ~~Note 7~~ to ~~the~~be ~~Consolidated~~an ~~Financial~~attractive ~~Statements.~~collateral ~~Amounts~~source ~~outstanding~~for ~~under~~our ~~existing~~lenders ~~lines~~evidenced ofby ~~credit~~our ~~and~~long ~~other~~history ~~secured and unsecured borrowings were approximately $1.08 billion as~~ of ~~December 31,~~obtaining ~~2015,~~capital ~~$1.16 billion~~lease ~~as of December 31~~obligations, ~~2014~~term-loans and ~~$1.16 billion~~most ~~as of December 31~~recently, ~~2013.~~asset Asbacked ~~of December 31, 2015, we had the ability to draw $343~~lending.~~5 million~~ under our ABL Facility. No other amounts are available to draw under other secured or unsecured borrowings. As of December 31, 2015, we were in compliance with all covenants under the indenture, the ABL Facility and other agreements. We believe that we will be able to continue to maintain compliance with all applicable covenants for the next 12 months.

As of December 31, 2015, we have approximately $41.4 million of scheduled debt amortization throughout 2016. This amount does not include $40.2 million of interest payments, $37.5 million of asset purchase commitments and $15.7 million of operating lease commitments existing as of December 31, 2015 maturing by December 31, 2016. We expect that cash flows from operations and principal collections on direct finance leases will be sufficient to meet our liquidity needs for 2016, funding maturing debt and satisfying our contractual obligations. However, we may need to borrow funds to finance the purchases of new and used assets or to remanufacture assets to expand the business. No assurance can be made that we will be able to meet our financing and other liquidity needs as currently contemplated. See "Risk factors—Our inability to service our debt obligations or to obtain additional financing as needed would have a material adverse effect on our business, financial condition and results of operations."

On January 14, 2016, we borrowed $52.0 million (the "Borrowing") under the revolving credit facility of the ABL Facility. The Borrowing was used to finance the repurchase and retirement of 62 shares, par value $0.01 per share, of the common stock of Interpool, Inc. held by the Company, the sole shareholder of Interpool, Inc., at an aggregate purchase price of approximately $51.0 million (the "Repurchase Amount"). Through a successive chain of dividends, the Repurchase Amount was received pro rata by our indirect shareholders of record, including certain private equity funds that are managed by an affiliate of Fortress Investment Group LLC, employees of affiliates of Seacastle Inc. (our indirect parent) and members of management.

Historically, the Company has had the ability to service debt obligations and to obtain additional financing as needed by the business. The majority of our debt is secured by long-lived assets which have proven to be an attractive collateral source for our lenders evidenced by our long history of obtaining capital lease obligations, term-loans and most recently, asset backed lending.

Liquidity needs for acquisition of new chassis

We expect to invest substantial funds to acquire new and used chassis and to refurbish and remanufacture chassis, although there can be no no assurances as to the timing and amount of such acquisitions. During the year ended December 31, ~~2015~~2016, $7581.42 million was invested of which $3354.7 million was used to acquire ~~and~~, refurbish and remanufacture marine chassis and $4126.75 million was used to acquire and remanufacture domestic chassis. As of December 31, ~~2015~~2016, an additional $4019.30 million was committed to the acquisition and refurbishment of equipment. During ~~2014,~~the ayear ~~total~~ended ofDecember 31, 2015, $~~149~~75.4 million was invested of which $~~111~~33.67 million was used to acquire and refurbish marine chassis and $3741.87 million was used to remanufacture domestic chassis.

We intend to continue funding asset purchases during ~~2016~~2017 through cash flows from operations, collections of principal on direct finance leases, and borrowings under ~~secured~~our ~~and unsecured~~ABL ~~debt securities and lines of credit~~Facility. However, deterioration in our performance, the credit markets or our inability to obtain additional financing on attractive terms, or at all, could limit our access to funding or drive the cost of capital higher than the current cost. These factors, as well as numerous other factors detailed above in "Risk factors," including "The demand for leased chassis depends on many economic, political and other factors beyond our control and a decrease in the volume of world trade and other factors may adversely affect our business," could limit our ability to raise funds and further the growth of our business.

Cash flow

Cash flow information for the years ended December 31, 2016, 2015 and 2014.

	Year ended December 31,

(Dollars in thousands)	2016			2015			2014
Net cash provided by operating activities	$	151,052		$	181,335		$	138,549
Net cash used in investing activities		(95,478	)		(75,028	)		(141,488	)
Net cash used in financing activities		(43,072	)		(106,517	)		(4,306	)
Effect of changes in exchange rates on cash and cash equivalents		(43	)		(885	)		(342	)

Net increase (decrease) in cash and cash equivalents	$	12,459		$	(1,095	)	$	(7,587	)

Comparison of the year ended December 31, 2016 to the year ended December 31, 2015

Net cash provided by operating activities was $151.1 million for the year ended December 31, 2016, compared to $181.3 million for the year ended December 31, 2015, a decrease of $30.3 million. The decrease was primarily the result of decreased profitability on lower leasing equipment revenue of $31.5 million and lower cash provided by working capital and timing of interest payments of $1.1 million.

Net cash used in investing activities was $95.5 million for the year ended December 31, 2016 compared to $75.0 million for the year ended December 31, 2015, a $20.5 million increase in cash used. The increase was primarily driven by a $5.5 million increase in capital spending, a $4.7 million business acquisition and a $9.7 million decrease in proceeds from sale of leasing equipment and sale of other assets.

Net cash used in financing activities was $43.1 million for the year ended December 31, 2016 compared to $106.5 million for the year ended December 31, 2015, a $63.4 million decrease in cash used. The decrease in cash used for 2016 is primarily attributed to lower net repayments of long term debt of $100.8 million, lower debt issuance costs of $9.7 million, lower premium paid for redemption of Notes of $6.6 million partially offset by a dividend payment of $51.2 million and an increase in share repurchases from employees of $1.1 million.

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Cash flow

Cash flow information for the years ended December 31, 2015, 2014 and 2013.

	Year ended December 31,
(Dollars in thousands)	2015			2014			2013
Net cash provided by operating activities	$	181,335		$	138,549		$	66,756
Net cash used in investing activities		(75,028	)		(141,488	)		(132,566	)
Net cash (used in) provided by financing activities		(106,517	)		(4,306	)		51,696
Effect of changes in exchange rates on cash and cash equivalents		(885	)		(342	)		(599	)

Net decrease in cash and cash equivalents	$	(1,095	)	$	(7,587	)	$	(14,713	)

Comparison of the year ended December 31, 2015 to the year ended December 31, 2014

Net cash provided by operating activities was $181.3 million for the year ended December 31, 2015, compared to $138.5 million for the year ended December 31, 2014, an increase of $42.8 million. The increase was primarily the result of increased profitability on higher leasing equipment revenue of $26.3 million and higher cash provided by working capital and timing of interest payments of $16.5 million. The increase in cash from working capital was driven by increases in revenue and cash collected compared to prior year as well as timing of payments to vendors.

Net cash used in investing activities was $75.0 million for the year ended December 31, 2015 compared to $141.5 million for the year ended December 31, 2014, a $66.5 million decrease in cash used. The decrease was primarily driven by a $62.1 million decrease in capital spending and a $3.3 million increase in proceeds from sale of leasing equipment during 2015.

Net cash used in financing activities was $106.5 million for the year ended December 31, 2015 compared to $4.3 million for the year ended December 31, 2014, a $102.2 million decrease in cash. The decrease in cash for 2015 is primarily attributed to higher net repayments of long term debt of $84.3 million, higher debt issuance costs of $6.8 million and the premium paid for redemption of ~~notes~~Notes of $12.4 million.

Comparison of the year ended December 31, 2014 to the year ended December 31, 2013

Net cash provided by operating activities was $138.5 million for the year ended December 31, 2014, compared to $66.8 million for the year ended December 31, 2013, an increase of $71.7 million. The increase was primarily the result of increased profitability on higher leasing equipment revenue $38.0 million, lower cash paid for interest of $4.3 million and higher cash provided by working capital of $28.7 million. The increase in cash from working capital was driven by increases in revenue and cash collected compared to prior year as well as timing of payments to vendors.

Net cash used in investing activities was $141.5 million for the year ended December 31, 2014 compared to $132.6 million for the year ended December 31, 2013, a $8.9 million increase in cash used. The increase was primarily driven by a $9.0 million increase in capital spending during 2014.

Net cash used in financing activities was $4.3 million for the year ended December 31, 2014 compared to net cash provided by financing activities of $51.7 million for the year ended December 31, 2013, a $56.0 million decrease. The decrease in cash for 2014 is primarily attributed to lower net borrowing of $55.0 million and higher debt issuance costs of $0.9 million.

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Contractual obligations and commitments

The following table summarizes our various contractual obligations in order of their maturity dates as of December 31, ~~2015~~2016. The terms of our credit facilities are more fully described below under "Description of other indebtedness."

			Maturity in years
(Dollars in thousands)	Total as of December 31, ~~2015~~2016		Less than 1 year		2 Years		3 Years		4 Years		5 Years		Thereafter
ABL Facility	$	~~867~~1,032,000	$	~~4,000~~—	$	—	$	—	$	—1,032,000	$	~~863,000~~—	$	—
TRAC 2019 Senior Secured Notes		150,000		—		—		—		150,000		—		—
TRAC 2019 Senior Secured Notes(a)		45,000		—		—		45,000		—		—		—
Loan payable to CIMC		1411,~~519~~989		2,~~540~~641		2,~~662~~782		2,~~789~~931		23,~~923~~088		~~3,064~~547		~~541~~—
Capital lease obligations		498,~~160~~412		346,~~856~~532		~~7,831~~502		~~5,094~~501		~~502~~501		~~501~~376		~~376~~—
Lease equipment purchase commitments		40,297		37,517		2,780		—		—		—		—
Lease equipment purchase commitments(b)		18,950		18,950		—		—		—		—		—
Interest payments		175,493		40,205		38,313		38,054		37,784		21,120		17
Tire purchase commitments		23,203		6,613		5,530		5,530		5,530		—		—
Operating leases		55,939		15,672		12,393		5,168		3,767		3,407		15,532
Interest payments		128,085		33,531		33,339		33,165		28,031		19		—
Operating leases		39,786		11,864		5,210		3,773		3,407		3,465		12,067

Total	$	1,~~352~~307,~~408~~425	$	~~134~~80,~~790~~131	$	6347,~~979~~363	$	5190,~~105~~900	$	~~194~~1,~~976~~072,557	$	~~891~~4,~~092~~407	$	1612,~~466~~067

(a): On February 27, 2017, we borrowed $19.0 million under our ABL Facility to partially finance the redemption of an additional $25.0 million in aggregate principal amount of our Notes. See Note 20 to our Consolidated Financial Statements.
(b): This represents the non-cancellable portion of contracts related to refurbishment, remanufacturing and capital lease buy-out agreements that aggregate $92.8 million over a four year period.

Our contractual obligations consist of principal and interest payments related to the ABL Facility, the Notes, chassis purchase commitments and operating lease payments for our chassis and office facilities. Interest payments are based upon the net effect of swapping our variable interest rate payments for fixed rate payments. For more information, see "—Description of other indebtedness."

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Covenants

Under the indenture governing the Notes, the ABL Facility and our other debt instruments, we are required to maintain certain financial covenants (as defined in each agreement) including a minimum tangible net worth test, a funded debt to tangible net worth test and a fixed charge coverage test. As of December 31, ~~2015~~2016, we were in compliance with all financial covenants as defined under the indenture, the ABL Facility and other agreements. We believe that we will be able to continue to maintain compliance with all applicable covenants for the next 12 months.

Commitments

Chassis purchase commitments

Our current chassis purchase commitments are related to commitments to refurbish ~~and~~chassis, remanufacture chassis and exercise a purchase option on a maturing capital lease. We do not bear the risks and rewards of ownership until delivery and therefore do not record an asset or a liability related to the refurbishing and remanufacturing commitments. At December 31, ~~2015~~ 2016, we had commitments for capital expenditures for leasing equipment ~~totaled~~of ~~approximately~~ $4019.30 million, all of which ~~$37.5 million and $2.8 million~~ was committed for ~~2016 and~~ 2017~~, respectively~~.

Tire purchase commitments

Contemporaneous with the Interstar Acquisition, we committed to purchase from an affiliate of the acquired company 45,000 tires annually for a period of five years. Initial prices for tire types were agreed upon but are subject to purchase price adjustments based on certain changes in the cost of raw materials used in the manufacturing process as well as the mix of tires to be purchased over the commitment period. At December 31, 2016, the tire purchase commitments are estimated to be $23.2 million with $6.6 million committed for 2017 and $5.53 million committed for 2018, 2019 and 2020, respectively.

Operating leases

We are a party to various operating leases relating to office facilities and certain other equipment with various expiration dates through 2026. The aggregate minimum rental commitment under our material leases was $5539.98 million as of December 31, ~~2015~~2016.

Stock Buyback Program

On April 13, 2016, Interpool instituted a stock buyback program (the "Stock Buyback Program") whereby employees who hold vested shares of SCT Chassis, Inc. ("SCT Chassis"), an indirect parent of the Company, pursuant to Management Shareholder Agreements executed prior to January 1, 2016, will be eligible to elect, on an annual basis, to sell up to 25% of such shares to Interpool. Under the Stock Buyback Program, participants will elect annually whether to participate in the Stock Buyback Program and the number of eligible shares they wish to sell. Elections will generally be made on or about April 30 of each year, and the Stock Buyback Program will expire in 2019 after all completed share repurchase elections are fulfilled for that year. The fair market value price, at which SCT Chassis shares will be repurchased, will be determined each year by the Board of Directors of SCT Chassis. At December 31, 2016, the estimated repurchase amount based on the current such fair market value price of $10.50 per share is $3.0 million.

Off-balance sheet arrangements

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~~principal~~regulations, and contractual relationships, among others. Performance under these indemnities would generally be triggered by a breach of terms of the contract or by a third-party claim. One of the principal types of indemnification for which payment is possible is taxes. The other principal type of indemnity we may agree to is one in favor of certain lenders and chassis pool hosts indemnifying them against certain claims relating to the operation of our chassis, although this type of indemnity generally is covered by insurance or an indemnity in our favor from a third-party, such as a lessee or a vendor. We regularly evaluate the probability of having to incur costs associated with these indemnifications and have concluded that none are probable. We do not believe such arrangements have or are reasonably likely to have a current or future material effect on our financial condition, revenues and expenses, results of operations, liquidity, capital expenditures or capital resources.

Operating leases are part of our off-balance sheet arrangements. For more information on our liability under operating leases, see above "—Commitments—Operating leases".

Emerging Growth Company

Section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards after April 5, 2012. However, we have chosen to "opt out" of such extended transition period and as a result, we will comply with the new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

Description of other indebtedness

The following is a summary of the material terms and conditions of our material debt instruments. The description is only a summary and is not intended to describe all of the terms of our material debt instruments that may be important.

ABL Facility

On August 9, 2012, Interpool together with certain of its subsidiaries, TRAC and TRAC Intermodal Corp, entered into a $725.0 million asset based, senior secured credit agreement with lenders party thereto and JPMorgan Chase Bank, N.A. acting as the administrative agent (the "ABL Facility"). In connection with the ABL Facility, certain rental fleet assets, accounts receivable, instruments, documents, equipment, machinery, deposit, lockbox and securities accounts, investment property, chattel paper, general intangibles and other assets, as agreed, are being pledged for the benefit of the lenders, the administrative agent, the issuing bank and certain other parties as collateral security for the payment and performance of our obligations under the ABL Facility and the related loan documents, certain bank product obligations and certain swap obligations.

From December 2012 to December 2014, the ABL Facility was amended numerous times, each time increasing the revolving commitment. During this time, the revolving commitment was increased from $725.0 million at December 31, 2012 to $1.25 billion at December 31, 2014.

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On August 11, 2015 and subsequently on December 10, 2015, we entered into amendments and incremental facility amendments to our ABL Facility. See "Borrowings-Amendments to ABL Facility 2015" in Note 7 to the Consolidated Financial Statements.

The ABL Facility has a maturity date of December 10, 2020 (provided such maturity is at least 91 days prior to the maturity of the Notes or senior notes we may issue, subject to certain exceptions) and borrowings are limited to a maximum amount (the "Borrowing Base") equal to the sum of (i) 85% multiplied by eligible accounts receivable (including Canadian accounts receivable), plus (ii) the lesser of (a) 85% multiplied by the sum of the net book U.S. GAAP depreciated value for eligible rental fleet assets not subject to a direct finance lease and the net investment in accordance with U.S. GAAP with respect to eligible rental fleet assets subject to a direct finance lease (in each case, including rental fleet assets located in Canada and up to the lesser of 5% of the Borrowing Base and $60.0 million of fleet assets located in Mexico) and (b) 80% multiplied by the net orderly liquidation value percentage identified in the most recent rental fleet asset appraisals multiplied by the sum of the net book U.S. GAAP depreciated value for eligible rental fleet assets not subject to a direct finance lease and the net investment in accordance with U.S. GAAP with respect to eligible rental fleet assets subject to a direct finance lease (in each case, including rental fleet assets located in Canada and up to the lesser of 5% of the Borrowing Base and $60.0 million of fleet assets located in Mexico), less (iii) reserves established by the Administrative Agent. Field exams and appraisals will be conducted on a periodic basis, the frequency of which increases subject to certain availability triggers or during the continuance of an event of default.

The ABL Facility bears an interest rate equal to the Adjusted LIBO Rate for the applicable Interest Period plus the Applicable Rate for Eurodollar Loans or the Alternate Base Rate plus the Applicable Rate for ABR Loans (all as defined in the ABL Facility). Until December 10, 2016, the Applicable Rate is equal to (i) 2.00% for Eurodollar Loans, and (ii) 1.00% for ABR Loans. Thereafter, the Applicable Rate is subject to increase or decrease on the first business day of each fiscal quarter, based on the Average Availability (as defined in the ABL Facility) for the then most recently ended fiscal quarter, as set forth below:

Average Availability
<$300 million	2.25%	%	1.25%	%
$300 million to <$600 million	2.00%	%	1.00%	%
>$600 million	1.75%	*	0.75%	*

*: Applies only if the Total Leverage Ratio for Test Period in effect (each as defined in the ABL Facility) does not exceed 3.50 to 1.00.

The ABL Facility contains various representations and covenants, including the financial covenants described below. A minimum fixed charge coverage ratio of 1.00 to 1.00 shall be required for applicable testing periods on any day on which Average Availability is less than the greater of (i) 12.5% of the Total Revolving Commitment (all as defined in the ABL Facility) and (ii) $100.0 million, and shall continue to be required until the date on which Average Availability shall have exceeded such thresholds for at least 30 consecutive days. A maximum senior secured leverage ratio for the applicable testing periods of (i) 5.25 to 1.00 for Test Periods ending from the effective date of the ABL Facility to December 31, 2016, (ii) 5.00 to 1.00 for Test Periods ending March 31, 2017 to December 31, 2017, and (iii) 4.50 to 1.00 for Test Periods ending March 31, 2018 to the maturity date shall be required on any day on which Availability (as defined in the ABL Facility) is less than the greater of (i) 12.5% of the Total Revolving Commitment and (ii) $100.0 million and shall continue to be required until the date on which Availability shall have exceeded such thresholds for at least 30 consecutive days.

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In addition to the above financial covenants, the ABL Facility contains restrictions, which include but are not limited to, restrictions on the creation of liens, the ~~incurrence~~prepayment of existing indebtedness, the incurrence of additional indebtedness (including guarantee obligations), investments, asset dispositions, sale and leaseback transactions, swap agreements, optional payments and modifications of subordinated and other debt instruments, changes in fiscal year, negative pledge clauses and other burdensome agreements, transactions with affiliates, mergers and consolidations, liquidations and dissolutions, restricted payments (including dividends and other payments in respect of capital stock), asset sales or transfers, amendments of material documents and transactions with respect to PoolStat®. The ABL Facility also provides for cash dominion subject to certain availability triggers.

The amount outstanding under ~~this~~the ~~facility~~ABL Facility was $~~867~~1,032.0 million and $~~759~~867.0 million at December 31, ~~2015~~2016 and ~~2014~~2015, respectively. The weighted-average interest ~~rates~~ rates including amortized debt issuance fees for the years ended December 31, ~~2015~~2016, ~~2014~~2015 and ~~2013~~2014 was 3.5111%, 3.6051% and 43.0360%, respectively. At December 31, ~~2015~~2016, $~~343~~203.50 million additional borrowing capacity was available under this facility.

Senior Secured 11% Notes

On August 9, 2012, TRAC along with TRAC Intermodal Corp., sold $300.0 million aggregate principal amount of 11.0% Senior ~~Secured~~ Secured Notes (the "Notes"). The Notes mature on August 15, 2019, with interest payable semi-annually beginning on February 15, 2013. The Notes are secured on a second-priority lien basis. Collateral generally consists of cash, owned chassis, accounts receivable, and investment property of the guarantors including, with limitations, the equity of the non-guarantors. The Company ~~may~~ may redeem some or all of the Notes at any time on or after August 15, 2015 at the redemption prices set forth in the Notes plus accrued and unpaid interest, if any, to the redemption date. ~~At any~~If ~~time prior to August 15, 2015,~~ the ~~Company may redeem some or all of the Notes at a price equal to 100% of the principal amount of the Notes to be redeemed plus a "make-whole" premium, plus~~ ~~accrued and unpaid interest, if any, to the redemption date. The~~ Company may also redeem up to 35% of the aggregate principal amount of the Notes at any time on or prior to August 15, 2015 using net proceeds from certain equity offerings, subject to the satisfaction of certain conditions set forth in the Notes. If the Company experiences certain kinds of changes in control, the Company must offer to purchase the Notes at a price equal to 101% of the principal amount of the Notes plus accrued and unpaid interest, if any, to the redemption date. Holders of the Notes will have the option to redeem their Notes for 101.0% of principal upon a change of control as defined by the Notes and upon the Company's collateral or non-collateral asset sales as defined in the Notes, at a redemption price of 100.0%.

On August 17, 2015, ~~the~~we ~~Company~~ borrowed $176.0 million under ~~its~~our ABL Facility which carries an interest rate of one-month USD LIBOR + 2.25%. The funds were used to finance the redemption of $150.0 million in aggregate principal amount of the outstanding Notes at a redemption price equal to 108.250 of such aggregate principal amount. Approximately $162.4 million was paid to redeem the Notes, $150.0 million aggregate principal amount and a premium of $12.4 million. Additionally, ~~and~~ approximately $3.1 million of deferred financing fees were expensed upon redemption.

~~The~~On ~~aggregate~~August 15, ~~principal~~2016, ~~amount~~we ofborrowed ~~Notes outstanding was~~ $~~150~~80.0 million ~~and~~under ~~$300.0~~our ABL Facility which carries an interest rate of one-month LIBOR ~~million~~+ 2.00% atand matures on December 3110, ~~2015~~2020, ~~and~~which ~~2014~~is the maturity date of the ABL Facility. The ~~weighted-average~~funds ~~interest~~were ~~rates including~~used ~~amortized~~to ~~debt~~finance ~~issuance~~the ~~fees~~redemption ~~for~~of ~~the~~$80.0 million ~~years~~in ~~ended~~aggregate ~~December~~principal amount of our outstanding Notes at a redemption price equal to 105.500 ~~31,~~percent ~~2015,~~of ~~2014~~such ~~and~~aggregate ~~2013~~principal ~~was~~amount. 11Approximately $84.~~53%~~4 million was paid to redeem the Notes, 11$80.~~54%~~0 million aggregate principal amount and 11a premium of $4.~~50%~~4 million. Additionally, ~~respectively~~$1.2 million of deferred financing fees related to the Notes were expensed upon redemption.

On December 28, 2016, we borrowed $25.0 million under our ABL Facility which carries an interest rate of one-month LIBOR + 2.00% and matures on December 10, 2020, which is the maturity date of the ABL Facility. The funds were used to finance the redemption of $25.0 million in aggregate principal amount of our outstanding Notes ~~Deutsche~~at ~~Bank~~a ~~Swap~~ redemption price equal to 105.500 percent of such aggregate principal amount. Approximately $26.4 million was paid to redeem the Notes, $25.0 million

On January 10, 2013, we entered into an interest rate swap transaction with Deutsche Bank AG. The agreement effectively converts $300.0 million of variable rate debt based upon LIBOR into a fixed rate instrument. We receive one-month LIBOR with interest payable at a rate of 0.756% on the

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~~notional~~aggregate principal amount. Atand ~~December 31,~~a ~~2015,~~premium ~~one-month~~of ~~LIBOR~~$1.4 million. ~~was~~Additionally, $0.~~4295%.~~3 million ~~The~~of ~~agreement~~deferred ~~terminates~~financing onfees ~~August 9,~~related ~~2017~~to the Notes were expensed upon redemption.

The aggregate principal amount of Notes outstanding was $45.0 million and $150.0 million at December 31, 2016 and 2015. The weighted-average interest rates including amortized debt issuance fees for the years ended December 31, 2016, 2015 and 2014 was 11.54%, 11.53% and 11.54%, respectively.

Deutsche Bank Swap

On February 4, 2016, we executed two interest rate swap agreements with Deutsche Bank. One agreement effectively converts $50.0 million of variable rate debt based upon LIBOR into a fixed rate of 1.063% per annum. This agreement will terminate on December 10, 2020 at the same time our ABL Facility terminates. Additionally, we executed a $300.0 million forward interest rate swap agreement. This agreement begins on August 9, 2017 when our existing $300.0 million swap agreement ends. At that time, we will effectively convert $300.0 million of variable rate debt based upon LIBOR into a fixed rate of 1.2985%.

On February 5, 2016, we executed an interest rate swap with PNC Bank effectively converting $100.0 million of variable rate debt based upon LIBOR into a fixed rate of 1.1175%. The agreement will terminate December 10, 2020 at the same time our ABL Facility terminates.

At December 31, 2016, one-month LIBOR was 0.7717%.

Loans payable to CIMC

During 2010, we contracted for the remanufacture and financing of 3,135 chassis with CIMC Vehicles Group Ltd. and CIMC ~~Transportation~~ Transportation Equipment, Inc. (collectively, "CIMC"). CIMC ~~has~~ agreed to finance 90% of the acquisition cost of these remanufactured chassis. This equipment was delivered in eight tranches as manufacturing was completed over various delivery dates from October 11, 2010 to June 30, 2011 and eight corresponding financing agreements ~~have~~were ~~been~~ signed. The term of each agreement is 120 months commencing on the acceptance date of the equipment. Amounts outstanding under these agreements bear an interest rate equal to LIBOR plus a margin and payments are made quarterly. Upon registration, CIMC is listed as the first lien holder on all certificates of title to the equipment. At December 31, ~~2015~~2016 and ~~2014~~2015, $1412.50 million and $1714.05 million were outstanding under these agreements, respectively. The weighted-average interest rates for the years ended December 31, ~~2015~~2016, ~~2014~~2015 and ~~2013~~ 2014 were 4.5998%, 4.5359% and 4.5653%, respectively.

Capital lease obligations

At December 31, ~~2015~~2016 and ~~2014~~2015, the total capital lease obligations outstanding associated with leasing equipment were $498.24 million and $8849.32 million, respectively. The capital lease obligations mature in varying amounts from ~~2015~~2017 through 2021 and have stated rates ranging from 35.5300% to 75.0729%. The weighted-average interest rates for the years ended December 31, ~~2015~~2016, ~~2014~~2015 and ~~2013~~2014 were 4.8186%, 4.9681%, and 54.1096%, respectively.

Non-GAAP Measures

Adjusted Net (Loss) Income

Adjusted net (loss) income is a measure of financial and operating performance that is not defined by U.S. GAAP and should not be considered a substitute for net income, income from operations or cash flow from operations, as determined in accordance with U.S. GAAP. Adjusted net (loss) income is a measure of our operating and financial performance used by management to focus on consolidated financial and operating performance exclusive of income and expenses that relate to non-routine or significant non-cash items of the business.

We define adjusted net (loss) income as net (loss) income before non-cash interest expense related to deferred financing fees, non-cash share-based compensation, loss on modification and extinguishment of debt and capital lease obligations, terminations, modification, and fair value adjustments of derivative instruments and other non-routine, non-cash items as determined by management. We use adjusted net (loss) income to assess our consolidated financial and operating performance, and we believe this non-GAAP measure is helpful to management and investors in identifying trends in our performance. This measure helps management make decisions that are expected to facilitate meeting current financial goals as well as achieve optimal financial performance. Adjusted net (loss) income provides us with a measure of financial performance of the business based on operational factors, including the profitability of assets on an economic basis, net of operating expenses, and the capital costs of the business on a consistent basis as it removes the impact of certain non-routine and non-cash items from our operating results. Adjusted net (loss) income is a key metric used by senior management and our board of directors to review the consolidated financial performance of the business.

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~~The~~ Chassis ~~following~~Purchase ~~table~~Option ~~shows the reconciliation of net loss, the most directly comparable U.S. GAAP measure, to adjusted net income:~~ Exercised

	Year ended December 31,
(dollars in thousands)	2015			2014			2013
Net income (loss)	$	26,718		$	(2,956	)	$	(29,353	)
Non-cash interest expense, net of tax		4,173			4,208			3,856
Non-cash share-based compensation, net of tax		375			486			709
Loss on modification and extinguishment of debt and capital lease obligations, net of tax		11,911			189			543
Loss on termination and modification of derivative instruments, net of tax		12,106			10,974			11,987
Fair value adjustment for derivative instruments, net of tax		(51	)		(51	)		(49	)
Non-cash tax expense—gain on related company stock distribution		—			—			22,105
Early retirement of leasing equipment, net of tax		—			22,660			—
Professional fees paid to company advisors		150			—			—

Adjusted net income	$	55,382		$	35,510		$	9,798

On January 3, 2017, the Company exercised a purchase option for a maturing capital lease for an aggregate purchase price of $5,937.

~~Adjusted~~ ~~net (loss) income has limitations as an analytical tool, is not a presentation made in accordance with U.S. GAAP and should not be considered in isolation, or as a~~ ~~substitute for analysis of our results as reported under U.S.~~ Non-GAAP, including net income or net cash from operating activities. For example, adjusted net (loss) income does not reflect (i) our cash expenditures or future requirements for capital expenditures or contractual commitments or (ii) changes in or cash requirements for our working capital needs. Measures

In addition, our calculation of adjusted net (loss) income may differ from the adjusted net income or analogous calculations of other companies in our industry, limiting its usefulness as a comparative measure. Because of these limitations, adjusted net (loss) income should not be considered a measure of discretionary cash available to us to invest in the growth of our business or to pay dividends. We compensate for these limitations by relying primarily on our U.S. GAAP results and using adjusted net (loss) income only supplementally.

Adjusted EBITDA

Adjusted EBITDA is a measure of both operating performance and liquidity that is not defined by U.S. GAAP and should not be considered a substitute for net income, income from operations or cash flow from operations, as determined in accordance with U.S. GAAP.

We define Adjusted EBITDA as income (loss) before provision (benefit) for income taxes, interest expense, depreciation and amortization expense, impairment of assets and leasing equipment, early retirement of leasing equipment, loss on modification and extinguishment of debt and capital lease obligations, other expense (income), interest income, ~~non-cash~~ share-based compensation and other non-routine or non-cash items as determined by management plus principal collections on direct finance leases.

Set forth below is additional detail as to how we use Adjusted EBITDA as a measure of both operating performance and liquidity, as well as a discussion of the limitations of Adjusted EBITDA as an analytical tool and a reconciliation of Adjusted EBITDA to our U.S. GAAP net (loss) income and cash flow from operating activities.

Operating performance: Management and our board of directors use Adjusted EBITDA in a number of ways to assess our consolidated financial and operating performance, and we believe this measure is helpful to management, the board of directors and investors in identifying trends in our performance. We use Adjusted EBITDA as a measure of our consolidated operating performance exclusive of income and expenses that relate to financing, income taxes, and capitalization of the business. Also, Adjusted EBITDA assists us in comparing our operating performance on a consistent basis as it removes the impact of our capital structure (primarily interest charges on our outstanding debt) and asset base (primarily depreciation and amortization) from our operating results. In addition, Adjusted EBITDA helps management identify controllable expenses and make decisions designed to help us meet our current financial goals and optimize our financial performance. Accordingly, we believe this metric measures our financial performance based on operational factors that management can impact in the short-term, namely the cost structure and expenses of the organization. Lastly, Adjusted EBITDA as defined herein is the basis for calculating selected financial ratios as required in the debt covenants of our ABL Facility.

Liquidity: In addition to the uses described above, management and our board of directors use Adjusted EBITDA as an indicator of the amount of cash flow we have available to service our debt obligations, and we believe this measure can serve the same purpose for our investors. We include principal collections on direct finance lease receivables in Adjusted EBITDA because these collections represent cash that we have available to service our debt obligations that is not otherwise included in net (loss) income. As a result, by adding back share-based compensation expenses and by including principal collections on direct finance lease receivables in Adjusted EBITDA, we believe Adjusted EBITDA is a more accurate indicator of our available cash flow to service our debt obligations than net (loss) income.

Limitations: Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under U.S. GAAP. These limitations include:

•: Adjusted EBITDA does not reflect any cash requirements for assets being depreciated and amortized that may have to be replaced in the future;

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•: Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;
•: Adjusted EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our debt;
•: Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs; and
•: Adjusted EBITDA does not reflect all of the cash requirements necessary to satisfy all of our non-discretionary expenditures.

exclusive of income and expenses that relate to financing, income taxes, and capitalization of the business. Also, Adjusted EBITDA assists us in comparing our operating performance on a consistent basis as it removes the impact of our capital structure (primarily interest charges on our outstanding debt) and asset base (primarily depreciation and amortization) from our operating results. In addition, Adjusted EBITDA helps management identify controllable expenses and make decisions designed to help us meet our current financial goals and optimize our financial performance. Accordingly, we believe this metric measures our financial performance based on operational factors that management can impact in the short-term, namely the cost structure and expenses of the organization. Lastly, Adjusted EBITDA as defined herein is the basis for calculating selected financial ratios as required in the debt covenants of our ABL Facility.

Liquidity: In addition to the uses described above, management and our board of directors use Adjusted EBITDA as an indicator of the amount of cash flow we have available to service our debt obligations, and we believe this measure can serve the same purpose for our investors. We include principal collections on direct finance lease receivables in Adjusted EBITDA because these collections represent cash that we have available to service our debt obligations that is not otherwise included in net (loss) income. As a result, by adding back non-cash share-based compensation expenses and by including principal collections on direct finance lease receivables in Adjusted EBITDA, we believe Adjusted EBITDA is a more accurate indicator of our available cash flow to service our debt obligations than net (loss) income.

Limitations: Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under U.S. GAAP. These limitations include:

Our calculation of Adjusted EBITDA may differ from the Adjusted EBITDA or analogous calculations of other companies in our industry, limiting its usefulness as a comparative measure. Because of these limitations, Adjusted EBITDA should not be considered a measure of discretionary cash available to us to invest in the growth of our business, to pay dividends or for discretionary expenditures. We compensate for these limitations by relying primarily on our U.S. GAAP results and using Adjusted EBITDA only supplementally.

The following table shows the reconciliation of net loss, the most directly comparable U.S. GAAP measure, to Adjusted EBITDA:

	Year ended December 31,

(dollars in thousands)	2016			2015			2014
Net income (loss)	$	19,925		$	26,718		$	(2,956	)
Provision (benefit) for income taxes		10,793			17,880			(3,445	)
Interest expense		62,777			80,246			86,837
Depreciation and amortization expense		74,414			72,128			72,114
Impairment of assets and leasing equipment		13,917			7,277			5,855
Early retirement of leasing equipment		—			—			37,766
Loss on modification and extinguishment of debt and capital lease obligations		7,486			19,852			315
Interest income		(109	)		(19	)		(61	)
Other (income) expense, net		(1,607	)		(1,144	)		(925	)
Principal collections on direct finance leases		2,945			3,665			4,622
Share-based compensation		1,821			625			810
Non-recurring professional fees primarily associated with termination of bond offering		1,603			—			—
Restructuring expense		1,806			—			—

Adjusted EBITDA	$	195,771		$	227,228		$	200,932

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The following table shows the reconciliation of net loss, the most directly comparable U.S. GAAP measure, to Adjusted EBITDA:

	Year ended December 31,
(dollars in thousands)	2015			2014			2013
Net income (loss)	$	26,718		$	(2,956	)	$	(29,353	)
Provision (benefit) for income taxes		17,880			(3,445	)		18,154
Interest expense		80,246			86,837			91,085
Depreciation and amortization expense		72,128			72,114			71,791
Impairment of assets and leasing equipment		7,277			5,855			5,857
Early retirement of leasing equipment		—			37,766			—
Loss on modification and extinguishment of debt and capital lease obligations		19,852			315			904
Interest income		(19	)		(61	)		(287	)
Other (income) expense, net		(1,144	)		(925	)		(2,074	)
Non-cash share-based compensation		625			810			1,181
Principal collections on direct finance leases		3,665			4,622			5,706

Adjusted EBITDA	$	227,228		$	200,932		$	162,964

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The following table shows the reconciliation of cash flows from operating activities, the most directly comparable U.S. GAAP measure of the Company's cash generation, to Adjusted EBITDA:

	Year ended December 31,
(dollars in thousands)	~~2015~~2016			~~2014~~2015			~~2013~~2014
Cash flows from operating activities to Adjusted EBITDA reconciliation:
Net cash provided by operations	$	~~181~~151,~~335~~052		$	~~138~~181,~~549~~335		$	66138,~~756~~549
Depreciation and amortization		(7274,~~227~~477	)		(72,~~365~~227	)		(72,~~026~~365	)
Recovery (provision) for doubtful accounts		258			(14,007	)		(11,369	)
(Provision) recovery for doubtful accounts		(7,812	)		258			(14,007	)
Amortization of deferred financing fees		(63,~~760~~876	)		(6,~~763~~760	)		(6,~~183~~763	)
Derivative loss reclassified into earnings		(2016,~~177~~359	)		(1820,~~290~~177	)		(1918,~~978~~290	)
Ineffective portion of cash flow hedges		85(251	)		8485			8284
Loss on modification and extinguishment of debt and capital lease obligations		(197,~~852~~486	)		(~~315~~19,852	)		(~~904~~315	)
Non-cash share-based compensation		(625	)		(810	)		(1,181	)
Share-based compensation		(1,821	)		(625	)		(810	)
Other, net		~~1,320~~918			~~928~~1,320			~~1,340~~928
Impairment of leasing equipment		(713,~~277~~917	)		(57,~~855~~277	)		(5,~~857~~855	)
Early retirement of leasing equipment		—			~~(37,766~~—	)		—(37,766	)
Changes in assets and liabilities:
Accounts receivable		(247,~~405~~573	)		35(24,~~264~~405	)		4335,~~888~~264
Other assets		~~906~~2,471			~~1,013~~906			361,013
Accounts payable		~~1,188~~435			(21,~~689~~188	)		(12,~~822~~689	)
Accrued expenses and other liabilities		129,~~072~~234			~~(24~~12,~~285~~072	)		(424,~~055~~285	)
Deferred income taxes, net		(1910,~~123~~613	)		4(19,~~351~~123	)		~~(18~~4,~~080~~351	)
Provision (benefit) for income taxes		1710,~~880~~793			(317,~~445~~880	)		18(3,~~154~~445	)
Interest expense		8062,~~246~~777			8680,~~837~~246			9186,~~085~~837
Depreciation expense		7274,~~128~~414			72,~~114~~128			7172,~~791~~114
Impairment of assets and leasing equipment		713,~~277~~917			57,~~855~~277			5,~~857~~855
Early retirement of leasing equipment		—			~~37,766~~—			—37,766
Loss on modification and extinguishment of debt and capital lease obligations		197,~~852~~486			~~315~~19,852			~~904~~315
Interest income		(19109	)		(6119	)		(~~287~~61	)
Other income, net		(1,~~144~~607	)		(~~925~~1,144	)		(~~2,074~~925	)
Non-cash share-based compensation		625			810			1,181
Principal collections on direct finance leases		2,945			3,665			4,622
Principal collections on direct finance leases		3,665			4,622			5,706
Share-based compensation		1,821			625			810
Non-recurring professional fees primarily associated with termination of bond offering		1,603			—			—
Restructuring expense		1,806			—			—

Adjusted EBITDA	$	~~227~~195,~~228~~771		$	~~200~~227,~~932~~228		$	~~162~~200,~~964~~932

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Exchange rate risk

While our leasing per diems are billed and paid to us in U.S. dollars, we are subject to exchange gains and losses for local currency expenditures. We record the effect of non-U.S. dollar currency transactions when we translate the non-U.S. subsidiaries' financial statements into U.S. dollars using exchange rates as they exist at the end of each month.

We have a division located in Canada and a subsidiary in Mexico. The functional currency of our Canadian division is the Canadian dollar. The functional currency of our Mexican subsidiary is the U.S. dollar. The effect of fluctuations in the Canadian dollar was not material in any period presented. 78

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~~Foreign~~We ~~exchange~~have ~~rate~~a ~~sensitivity~~division ~~analysis~~located ~~can~~in beCanada ~~quantified~~and ~~by estimating the impact on our earnings as~~ a ~~result~~subsidiary ofin ~~hypothetical~~Mexico. ~~changes~~The infunctional ~~the~~currency ~~value~~ of ~~the U.S. dollar,~~ our ~~functional currency,~~Canadian ~~relative~~division tois the ~~other~~Canadian ~~currencies in which we transact business~~dollar. ~~All~~The ~~other~~functional ~~things~~currency ~~being equal, an average 10% weakening~~ of ~~the~~our ~~U.S. dollar, throughout the year ended December 31, 2015,~~Mexican ~~would~~subsidiary ~~have~~is ~~had~~ the ~~effect of raising net income approximately $0.06 million. An average 10% strengthening of the~~ U.S. dollar,. ~~for~~The ~~the same period would have the~~ effect of ~~reducing~~fluctuations ~~operating income approximately $0.06 million. This calculation is not indicative of our actual experience~~ in ~~foreign~~the ~~currency~~Canadian ~~transactions.~~dollar ~~This~~was ~~analysis does~~ not ~~take~~material ~~into account changes~~ in ~~demand patterns~~any based upon this hypothetical currency fluctuation. For example, a weakening in the U.S. dollar would be expected to increase exports from the United States and decrease imports into the United States over some relevant period ~~of time, but the exact effect of this change cannot be quantified without making speculative assumptions~~presented.

Foreign exchange rate sensitivity analysis can be quantified by estimating the impact on our earnings as a result of hypothetical changes in the value of the U.S. dollar, our functional currency, relative to the other currencies in which we transact business. All other things being equal, an average 10% weakening of the U.S. dollar, throughout the year ended December 31, 2016, would have had the effect of raising net income approximately $0.04 million. An average 10% strengthening of the U.S. dollar, for the same period would have the effect of reducing operating income approximately $0.04 million. This calculation is not indicative of our actual experience in foreign currency transactions. This analysis does not take into account changes in demand patterns based upon this hypothetical currency fluctuation. For example, a weakening in the U.S. dollar would be expected to increase exports from the United States and decrease imports into the United States over some relevant period of time, but the exact effect of this change cannot be quantified without making speculative assumptions.

Interest rate risk

We have long-term debt obligations that accrue interest at variable rates. Interest rate changes may therefore impact the amount of ~~interest~~ interest payments, future earnings and cash flows. We have entered into an interest rate swap ~~agreement~~agreements to mitigate the impact of changes in interest rates that may result from fluctuations in the variable rates of interest accrued by our long-term debt obligations. Based on the debt obligation payable as of December 31, ~~2015~~2016, we estimate that cash flows from interest expense relating to variable rate debt and the relevant interest rate swap ~~agreement~~agreements would increase (decrease) by $1.46 million on an annual basis in the event interest rates were to increase (decrease) by 10%.

Market risk for fixed-rate, long-term debt is estimated as the potential decrease in fair value resulting from a hypothetical 10% increase in interest rates and amounts to $1.1 million as of December 31, ~~2015~~2016. The underlying fair values of our long-term debt were estimated based on quoted market prices or on the current rates offered for debt with similar terms and maturities.

Credit risk

We are subject to concentrations of credit risk with respect to amounts due from customers. We seek to limit our credit risk by performing ongoing credit evaluations and, when deemed necessary, require letters of credit, guarantees or collateral. We periodically evaluate maximum exposure limits for each customer. The credit criteria we consider may include, without limitation, the customer's financial strength, trade route, countries of operation, net worth, asset ownership, bank and trade credit references, credit bureau reports, operational history and/or payment history with us.

In addition, under the motor carrier model, the motor carrier and not the shipping line is in many cases the party responsible to pay for the use of our chassis. Typically, motor carrier companies are much smaller than shipping line companies and as a result are often a greater credit risk. Although the per diem rates we charge motor carriers are priced to take account of this increased credit risk, defaults by our customers may increase as we continue to transition to the motor carrier model.

Counterparty Risk

Our hedging ~~transaction~~transactions using a derivative ~~instrument~~instruments ~~has~~have counterparty credit risk. The ~~counterparty~~counterparties to our derivative ~~arrangement~~arrangements isare a major financial ~~institution~~institutions with acredit ~~high~~ratings ~~credit~~of ~~rating.~~Baa2 Asand aA3 ~~result,~~by weMoody's. We do not anticipate that ~~this~~these ~~counterparty~~counterparties will fail to meet ~~its~~their obligations. However, there can be no assurance that we will be able to adequately protect against this risk and will ultimately realize an economic benefit from our hedging strategy in the event of a default by ~~this~~any counterparty.

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Other

We do not purchase or hold any risk sensitive instruments for trading purposes.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The consolidated financial statements and notes thereto, referred to in Item 15 of this Form 10-K, are filed as part of this report and appear in this Form 10-K beginning on page F-1.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

NONE

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company's management, with the participation of the Company's Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), ~~has~~ has evaluated the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of December 31, ~~2015.~~ 2016. Based on such evaluation, the CEO and CFO have concluded that, as of December 31, ~~2015~~2016, the Company's disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to our management, including the CEO and CFO, to allow timely decisions regarding required disclosures.

Management's Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended) for the Company. Management assessed the effectiveness of our internal control over financial reporting as of December 31, ~~2015~~2016. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal Control-—Integrated Framework (2013 Framework). Management concluded that, as of December 31, ~~2015~~2016, internal control over financial reporting is effective 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 based on these criteria. This annual report does not include an attestation report of the Company's registered public accounting firm since an attestation report is not required for non-accelerated filers or emerging growth companies as established by rules of the SEC.

Changes in Internal Control over Financial Reporting

There have not been any changes in the Company's internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

NONE

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PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

TRAC was formed as of July 13, 2012 to facilitate the issuance of the Notes, and has not, to date, conducted any activities other than those incidental to their formation and the preparation of the offering memorandum relating to the Notes, the creation of an intercompany note with Interpool for the servicing of the Notes and preparation of a prospectus relating to the Notes. We conduct our business through Interpool and its consolidated subsidiaries. TRAC has no operations of its own. For this reason, information relating to the executive officers, managers and directors of Interpool and TRAC is presented below.

The following table and biographies set forth current information regarding our management team and board of directors, including members of the management of Interpool and TRAC.

Executive Officers, Managers and Directors

Name		Interpool Inc.	TRAC
Keith Lovetro	6061	Chief Executive Officer	Chief Executive Officer
		President	President
		Director	Manager
Chris Annese	5253	Chief Financial Officer	Chief Financial Officer,
		Executive Vice President	Executive Vice President
		Director	Manager
Gregg Carpene	5354	Chief Legal Officer	General Counsel
		Executive Vice President	Executive Vice President
		Secretary	Secretary
		Director	Manager
Val Noel	5455	Executive Vice President,	N/A
		Chief Operating Officer
Mark Michaels	5253	Senior Vice President,	N/A
		Chief Commercial Officer
Kevin Snyder	54	Vice President,	N/A
		Chief Information Officer

Keith Lovetro. Keith Lovetro joined TRAC Intermodal as its President, Chief Executive Officer and a director in June 2011, having begun his career in the transportation industry in 1980. Prior to joining TRAC, from October 2007 to June 2009 Keith was the President of YRC Regional Transportation Group, a subsidiary of YRC Worldwide, Inc., a transportation service provider, which was comprised of three independent operating companies that generated over $2.0 billion in annual revenue. From November 2006 to October 2007, he was the Executive Vice President of DHL United States, a subsidiary of Deutsche Post AG and DHL Express' U.S. business, a transportation management service, and from August 1994 to November 2006 Keith was President and Chief Executive Officer of FedEx Freight West, Inc., a provider of regional less-than-truckload transportation. Keith has experience in five modes of transportation: Intermodal, LTL, Small Package, Express Envelope and Airfreight. He earned his BA degree from the University of California Davis and an MBA degree from the University of Santa Clara. Keith served as a member of the Board of Directors for the Second Harvest Food Bank from 2004 until 2006 and is an active member of the American Trucking Association (ATA) and Intermodal Association of North America (IANA).

Chris Annese. Chris Annese joined ~~Seacastle~~TRAC ~~at its inception~~ in ~~June~~2008 ~~2007 and has served~~ as its Chief Financial Officer and a director ~~of TRAC since 2008~~. Effective January 1, 2015, Chris was ~~also~~ promoted to Executive Vice President. Chris ~~has~~also ~~over~~served ~~thirty~~as ~~years~~the ofChief ~~experience~~Financial inOfficer ~~finance.~~of ~~Prior to joining~~ Seacastle, hefrom ~~spent~~2007 ~~10 years at~~through ~~Cendant~~2015. ~~Corporation~~Chris ~~(now~~has ~~Wyndham~~over ~~Worldwide),~~thirty ayears ~~provider~~ of ~~business~~experience ~~and consumer services within the real estate and travel industries. Chris served in various~~

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~~financial~~in finance. Prior to joining Seacastle, he spent 10 years at Cendant Corporation (now Wyndham Worldwide), a provider of business and consumer services within the real estate and travel industries. Chris served in various financial roles including mergers and acquisitions, integration and, for his last 4 years, as Chief Financial Officer of Resort Condominiums International, LLC, known as RCI, a broker of timeshare trades, a $1.0 billion worldwide subsidiary of Wyndham Worldwide. He graduated with a BA in Accounting from Pace University.

Gregg Carpene. Gregg Carpene joined TRAC in 2003 and has served as its General Counsel, Secretary and a director ~~and has served as the General Counsel of Seacastle~~ since 2008. Effective January 1, 2016, Gregg was promoted to Executive Vice President. Gregg also served as the General Counsel of Seacastle from 2008 through 2015. From 1997 until 2003, Gregg served as the General Counsel of two of TRAC's subsidiaries. Prior to 1997, Gregg was a ~~member~~Member of the Philadelphia based law firm of Cozen O'Connor. He holds a BA from Dickinson College and a law degree from Rutgers School of Law where he was an editor of the Rutgers Law Journal.

Val T. Noel. Val Noel joined TRAC in November of 2013 as its Senior Vice President and Chief Operating Officer. Effective January 1, 2016, Val was promoted to Executive Vice President. From 2004 until 2013, Val served as President of Pacer Cartage and Executive Vice President of Intermodal Operations for Pacer International. Prior to 2004, Val spent twenty years at CSX where he held various positions in terminal operations, equipment, trucking, CSX's Door to Door service and ultimately as President of CSX Intermodal. Val attended LaSalle University. He currently serves as the Chairman of the Intermodal Association of North America (IANA) Operations Committee and has previously served as a member of the TTX Intermodal Advisory Board, IANA Board of Directors and American Trucking Association (ATA) Intermodal Drayage Board.

Mark Michaels. Mark Michaels joined TRAC in May of 2015 as its Senior Vice President and Chief Commercial Officer. Prior to joining TRAC, Mark was the Chief Commercial Officer in the Americas for Damco for a five year period. Damco is one of the leading global third party logistics providers and part of the Maersk Group. Prior to Damco, Mark worked for 17 years at Kuehne & Nagel where he was responsible for Sales and Marketing in North America. Mark earned his Masters of Science degree in International Logistics from Georgia Institute of Technology in 2003 and holds a Bachelor of Science degree in Business Administration from Oregon State University.

Kevin Snyder. Kevin Snyder joined TRAC in January of 2016 as its Vice President and Chief Information Officer. Prior to joining TRAC, Kevin served as the Chief Information Officer of AFS Logistics from 2014 to 2016, a leader in transportation cost management solutions. From 2009 to 2013, he served as the Global Chief Information Officer of Franklin Electric. Prior to Franklin Electric, Kevin served as Chief Executive Officer of EAS Software, a company he founded in 1989. Kevin holds MBA degrees from Purdue University (Krannert School of Business) and Tilburg University (TiasNimbas School of Business—Netherlands) and BS degrees in both Management Information Systems and Finance from Ball State University.

Family Relationships

There are no family relationships between any of our executive officers or directors.

Director Independence

TRAC and Interpool are privately owned. As a result, we are not required to have independent directors.

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Compensation Committee Interlocks and Insider Participation

Interpool and TRAC have not established a compensation committee. Interpool's board of directors may set compensation of our executive officers in accordance with standard company-wide guidelines. All of our directors are also executive officers.

Code of Ethics

The Company has adopted the Code of Business Conduct and Ethics (the "Code") that applies to its directors, officers and employees, including its principal executive officer, principal financial officer and principal accounting officer. The Code is posted in the Investors section of the Company's website at www.tracintermodal.com. The information contained on or connected to the Company's website is not incorporated by reference into this Form 10-K and should not be considered part of this or any other report that the Company files with or furnishes to the SEC.

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ITEM 11. EXECUTIVE COMPENSATION

This section provides information, in tabular and narrative formats, regarding the amounts of compensation paid to each of our named executive officers and related information.

Summary compensation table

As an "emerging growth company", we have opted to comply with the executive compensation rules applicable to "smaller reporting companies," as such term is defined under the Securities Act which require compensation disclosure for our principal executive officer and the two most highly compensated executive officers other than our principal executive officer who were serving as executive officers at the end of the last completed fiscal year (our "Named Executive Officers"). The following table sets forth certain information ~~concerning~~ concerning all cash and non-cash compensation awarded to, earned by or paid to each of our Named Executive Officers during the years ended December 31, ~~2015~~2016 and ~~2014~~2015:

Name and Principal Position		Salary ($)		Bonus ($)(2)		Stock Awards ($)(23)			Non-Equity Incentive Plan Compensation ($)(34)		All Other Compensation ($)(45)		Total ($)
Keith Lovetro,	~~2015~~2016	$	~~435~~450,000		—	$	—339,235	—	$	~~480~~261,~~371~~492	$	3958,~~170~~997	$	~~954~~1,~~541~~109,724
President and Chief	2014	$	407,000		—		—	—	$	785,994	$	39,832	$	1,232,826
President and Chief Executive Officer	2015	$	435,000		—		—	—	$	480,371	$	39,170	$	954,541
Executive Officer
Chris Annese,	2016	$	313,120		—	$	142,245	—	$	164,682	$	51,664	$	671,711
Chris Annese,	2015	$	304,000		—	$	108,418	—	$	315,256	$	33,770	$	761,444
Executive Vice President Chief Financial Officer	2015	$	304,000		—	$	108,418	—	$	315,256	$	33,770	$	761,444
Executive Vice President	2014	$	290,463		—		—	—	$	514,539	$	34,432	$	839,434
Kevin Snyder,(1)	2016	$	285,449	$	215,000	$	399,995	—	$	214,087	$	33,459	$	1,147,990
Chief Financial Officer
Vice President Chief Information Officer
Mark Michaels	2015	$	198,846		—	$	509,851	—	$	298,846	$	30,979	$	1,038,522
Senior Vice President
Chief Commercial Officer(1)

(1)Mr. ~~Michaels~~Snyder was hired as ~~Senior~~ Vice President, Chief ~~Commercial~~Information Officer on ~~May~~January 4,25 ~~2015~~2016. (2)Amounts included in Mr. Snyder's Bonus included a $140,000 sign on bonus and a $75,000 relocation bonus. (3)The amounts reported in the Stock Awards column represent the aggregate grant date fair value of restricted stock awards or restricted stock unit awards granted to our Named Executive Officers calculated in accordance with FASB Accounting Standards Codification Topic 718. A discussion of the methods used to calculate these values may be found in the Notes to Consolidated Financial Statements contained in this Form 10K. ~~(3)The amounts~~ ~~reported in the Non-Equity Incentive Plan Compensation column represent bonuses that were earned and payable to our Named Executive Officers in~~ ~~respect~~ of 2015 and 2014. See "—Annual Incentive Plan" below for more information. (4)The amounts reported in the All Other Compensation column consists of employer matching contributions to the Interpool 401(k) Plan, car allowance, long-term disability insurance premiums and life and health insurance premiums paid by Interpool for each Named Executive Officer.

~~Narrative disclosure to the summary compensation table~~ 83

The Summary Compensation Table above quantifies the amount or value of the different forms of compensation earned by or awarded to our Named Executive Officers in 2015, as determined pursuant to the Securities Act rules and provides a dollar amount for total compensation. Descriptions of the material terms of each Named Executive Officer's employment and related information is provided below under "—Employment Arrangements."

Base salary for each of our Named Executive Officers is generally determined by the employment offer letters or terms of employment that we have entered into with each of them, as may be adjusted

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~~from~~ ~~time~~ (4)The amounts reported in the Non-Equity Incentive Plan Compensation column represent bonuses that were earned and payable to ~~time~~our byNamed ~~the~~Executive ~~board~~Officers in respect of ~~directors~~2016 ofand ~~SCT~~2015. ~~Chassis,~~See "—Annual Incentive Plan" below for more information. (5)The amounts reported in the ~~case~~All Other Compensation column consists of ~~Mr. Lovetro~~employer matching contributions to the Interpool 401(k) Plan, orcar byallowance, ~~our~~long-term disability ~~President~~insurance premiums and ~~Chief~~life ~~Executive~~and ~~Officer,~~health ininsurance ~~the~~premiums ~~case~~paid ofby ~~the~~Interpool ~~other~~for each Named Executive ~~Officers~~Officer. Additionally Mr. Lovetro and Mr. Annese have amounts included for a gross up related to an interest allocation.

Narrative disclosure to the summary compensation table

The Summary Compensation Table above quantifies the amount or value of the different forms of compensation earned by or awarded to our Named Executive Officers in 2016, as determined pursuant to the Securities Act rules and provides a dollar amount for total compensation. Descriptions of the material terms of each Named Executive Officer's employment and related information is provided below under "—Employment Arrangements."

Base salary for each of our Named Executive Officers is generally determined by the employment offer letters or terms of employment that we have entered into with each of them, as may be adjusted from time to time by the board of directors of SCT Chassis, in the case of Mr. Lovetro, or by our President and Chief Executive Officer, in the case of the other Named Executive Officers.

Each of our Named Executive Officers is eligible, pursuant to his employment offer letter, to receive an annual performance bonus under our Annual Incentive Plan. A description of the material terms of this plan, including a general description of the formula applied in determining the amounts payable thereunder, is provided below under "—Annual Incentive Plan."

InWe ~~addition, we~~ have granted to each of our Named Executive Officers restricted shares of the common stock of SCT Chassis in respect of his employment, pursuant to the terms of a ~~management~~ management shareholder agreement. Additionally on October 28, as2016, ~~further~~restricted ~~described~~stock ~~below~~units inwere granted to Mr. Lovetro and Mr. Annese under the new SCT Chassis Restricted Stock Unit Plan. See below "—Employment Arrangements" and "—Additional Equity Arrangements." Interpool does not currently sponsor any other equity incentive plan for its Named Executive Officers."

Interpool does not sponsor a formal severance plan for its Named Executive Officers. However, it has a practice of providing certain senior executives with certain severance benefits in the event of an involuntary termination of employment by Interpool without cause. Pursuant to this practice, in the event of such a termination, in exchange for the execution of a valid release of any claims against the Company, each of our Named Executive Officers would be entitled to: (a) a severance payment equal to 12 months of base salary, payable in monthly installments; (b) an amount in cash equal to the annual incentive paid in respect of the most recently completed fiscal year prior to the termination date, multiplied by a fraction, the numerator of which is the number of calendar days that the Named Executive Officer was employed by the ~~company~~Company during the year in which the termination of employment occurred and the denominator of which is 365, payable on or around the time that current employees of the Company receive their bonuses pursuant to the Annual Incentive Plan and (c) all compensation accrued but not paid as of the termination date.

Employment arrangements

Interpool is not party to any employment agreements with its Named Executive Officers. Each Named Executive Officer's employment is at will, and subject to the terms and conditions set forth in the management shareholder agreement as further described below in "—Additional Equity Arrangements," and in an employment offer letter, in the case of Mr. Lovetro and Mr. ~~Michaels~~Snyder. At the start of each fiscal year, Interpool communicates to the ~~Named~~ Named Executive Officer his annual salary and incentive compensation bonus target for the year.

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Mr. Lovetro. Mr. Lovetro's employment offer letter, dated June 10, 2010, provides for an annual base salary of $375,000 and participation in Interpool's medical benefit plans, group life insurance, 401(k) plan and vacation entitlement. The employment offer letter also provided for a one-time guaranteed performance bonus in the amount of $100,000 for 2011. Since this time, Mr. Lovetro's salary, bonus target and benefits have been adjusted commensurate with his position, as reflected in the "Summary Compensation Table" above.

In addition, in fulfillment of the terms of his employment offer letter regarding certain equity incentive compensation, Mr. Lovetro received a grant of 102,250 restricted shares of SCT Chassis common stock on June 1, 2012, subject to equal vesting in four parts on June 1, 2012 and each January 1 of 2013, 2014 and 2015. As of December 31, 2015 this grant is fully vested.

On October 28, 2016, under the terms of the newly formed SCT Chassis Restricted Stock Unit Plan, Mr. Lovetro received a grant of 40,578 restricted stock units of SCT Chassis common stock. These restricted stock units will vest in three equal parts on January 1, 2017, 2018 and 2019.

Mr. Annese. In connection with Mr. Annese's commencement of employment with a Seacastle affiliate in 2007, the parties initially agreed to a summary of employment terms including an annual base salary of $250,000 and an annual bonus target of $200,000. Since this time, Mr. Annese's salary, bonus target and benefits have been adjusted commensurate with his position, as reflected in the "Summary Compensation Table" above.

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Additionally, Mr. Annese received a grant of 40,430 restricted shares of SCT Chassis common stock on June 1, 2012, subject to equal vesting in four parts on June 1, 2012 and each January 1 of 2013, 2014 and 2015. As of December 31, 2015 this grant is fully vested. On January 1, 2015, Mr. Annese received a grant of 9,785 shares of SCT Chassis common stock which vested immediately.

~~Mr.~~ On October ~~Michaels. Mr. Michaels' employment offer letter~~28, ~~dated March 27~~2016, ~~2015,~~under ~~provides~~the ~~for~~terms ~~an annual base salary~~ of ~~$300,000~~ ~~and participation~~the innewly ~~Interpool's~~formed ~~medical~~SCT ~~benefit~~Chassis ~~plans,~~Restricted ~~group~~Stock ~~life~~Unit ~~insurance~~Plan, ~~401(k) plan and vacation entitlement~~Mr. Annese ~~The~~received ~~employment offer letter also provides for~~ a ~~one-time~~grant ~~cash bonus~~ of ~~$75~~17,~~000~~015 torestricted ~~be paid~~stock onunits ~~June 15,~~of ~~2015~~SCT ~~and~~Chassis common astock. ~~one-time~~These ~~cash~~restricted ~~bonus~~stock ofunits ~~$25,000~~will tovest ~~be paid on December 15, 2015,~~ in ~~each~~three ~~case~~equal ~~subject~~parts toon ~~Mr.~~January ~~Michaels' continued employment through such date. Additionally~~1, ~~Mr. Michaels was guaranteed to receive 100% of his pro-rated incentive compensation target amount for 2015 amounting to $198~~2017,~~846~~ 2018 and ~~50% of his incentive compensation target amount for 2016 amounting to $150,000~~2019.

~~In addition,~~ Mr. Snyder. Mr. Snyder's inemployment ~~fulfillment~~offer ofletter, ~~the~~dated ~~terms~~January 11, of2016, ~~his~~provides ~~employment~~for ~~offer~~an ~~letter~~annual ~~regarding~~base ~~certain~~salary ~~equity~~of ~~incentive compensation~~$305,000 and participation ~~Mr. Michaels~~in ~~received~~Interpool's amedical ~~grant~~benefit ~~of 49~~plans,~~261~~ ~~restricted~~group ~~shares of~~life ~~SCT~~insurance, ~~Chassis~~401(k) ~~common~~plan ~~stock~~and onvacation ~~June 1,~~entitlement. ~~2015,~~The ~~subject~~employment tooffer ~~equal~~letter ~~vesting~~also inprovides ~~four~~for ~~parts~~a onone-time ~~each~~cash ~~January 1~~bonus of ~~2016~~$140,000 ~~2017~~which was paid on March 15, ~~2018~~2016 and ~~2019.~~a ~~This~~one-time ~~grant~~cash isbonus ~~reflected~~towards inmoving ~~the~~and ~~"Outstanding~~real ~~Equity Awards~~estate atcosts ~~End~~ of ~~2015"~~$75,000 ~~table~~which ~~below~~was ~~and~~also ispaid ~~subject~~on toMarch 15, ~~the~~2016. ~~terms~~Additionally, ~~and~~Mr. Snyder ~~conditions~~was guaranteed to receive 100% of ~~the~~his ~~management~~pro-rated ~~shareholders~~incentive ~~agreement,~~compensation astarget ~~described~~amount infor ~~"—Additional~~2016 ~~Equity Arrangements~~amounting to $214,087."

In addition, in fulfillment of the terms of his employment offer letter regarding certain equity incentive compensation, Mr. Snyder received a grant of 35,682 restricted shares of SCT Chassis common stock on June 1, 2016, subject to equal vesting in four parts on each January 1 of 2017, 2018, 2019 and 2020. This grant is reflected in the "Outstanding Equity Awards at End of 2016" table below and is subject to the terms and conditions of the management shareholders agreement, as described in "—Additional Equity Arrangements."

Annual Incentive Plan

Interpool sponsors an Annual Incentive Plan pursuant to which its' Named Executive Officers, and each other eligible employee of Interpool, may receive cash bonuses based on company-wide and individual performance measures. The goal of this Plan is to reward the Named Executive Officers and other employees by providing further compensation based on the achievement of goals that Interpool believes correlate closely with its strategic objectives.

Mr. Lovetro had a target annual incentive of 120% of his 2015 base salary. Mr. Annese had a target annual incentive of 110% of his 2015 base salary. Mr. Michaels had a target annual incentive of 100% of his 2015 base salary to be prorated based on his employment date. Performance under the plan is based on company financial performance, which comprises 75% of the target bonus and individual performance, which comprises the remaining 25% of the target bonus. 85

Interpool's company financial performance goal Adjusted Earnings Before Tax ("Adjusted EBT") is calculated by taking total Earnings Before Tax and adding back certain non-cash items such as but not limited to non-cash interest expense, gains and losses on modification and extinguishment of debt and capital lease obligations, non-cash share-based compensation and other non-routine non-cash amounts as determined by management. The following table describes the maximum, target, and threshold levels of Adjusted EBT performance established for 2015, and the corresponding level at which the company factor of the annual incentive bonus available upon achievement of this goal.

Achievement Level	2015 Performance
Maximum	125% of target	200	%
Target	100% of target	100%	*
Threshold	75% of target	50	%

*In 2016, upon achieving 100% of target, Mr. Lovetro's company financial performance factor payout will be 125%, Mr. Annese's company financial performance factor payout will be 110% and Mr. Michaels' company financial performance factor payout will be 100%.

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~~For~~Mr. Lovetro ~~2015,~~had ~~our~~a ~~company~~target ~~financial~~annual ~~performance~~incentive of 125% of his 2016 base salary. Mr. Annese had a target ~~was~~annual anincentive ~~Adjusted~~of ~~EBT~~110% of ~~$104~~his 2016 base salary.~~0 million~~ Mr. Snyder ~~Since~~had wea target ~~fell~~annual ~~short~~incentive of ~~the~~75% ~~Target~~of ~~level~~his of2016 ~~Adjusted~~base ~~EBT,~~salary anto 88be prorated based on his employment date.~~87%~~ Performance under the plan is based on company financial performance, which comprises 75% of the target bonus ~~will~~and beindividual ~~paid~~performance, towhich ~~our~~comprises ~~Named~~the ~~Executive~~remaining ~~Officers~~25% of the target bonus.

~~Achievement~~Interpool's ofcompany ~~the~~financial ~~individual~~ performance ~~factor~~goal ~~was~~Adjusted ~~determined~~Earnings ~~separately~~Before ~~for~~Tax ~~each~~("Adjusted ~~Named~~EBT") ~~Executive~~is ~~Officer~~calculated ~~based~~by ontaking antotal ~~evaluation~~Earnings ofBefore ~~his~~Tax ~~performance~~and ~~during~~adding ~~the~~back ~~period~~certain ~~with~~non-cash ~~respect~~items tosuch ~~specific~~as ~~metrics~~but ~~established~~not ~~for~~limited ~~each~~to ~~individual.~~non-cash ~~Achievement~~interest ofexpense, ~~these~~gains ~~metrics~~and islosses ~~determined~~on bymodification ~~Mr. Lovetro,~~and ~~with~~extinguishment ~~respect~~of todebt ~~Mr. Annese~~ and ~~Mr. Michaels,~~capital ~~and~~lease byobligations, ~~the~~non-cash ~~board~~share-based ~~of directors~~compensation ofand ~~SCT~~other ~~Chassis,~~non-routine non-cash ~~with~~amounts ~~respect~~as todetermined ~~Mr. Lovetro.~~by ~~For 2015, Mr~~management. ~~Lovetro's~~ ~~individual~~The ~~performance~~following ~~goals~~table ~~related~~describes tothe ~~business~~maximum, ~~strategy and execution~~target, ~~operating expenses~~ and ~~technology strategy~~threshold ~~and~~levels ~~execution.~~of ~~Mr. Annese's~~Adjusted ~~individual~~EBT performance ~~goals~~established ~~related~~for to2016, ~~reduction of day's sales outstanding~~ and ~~bad~~the ~~debt~~corresponding ~~expense,~~level ~~operating expense control and data quality.~~at ~~Mr. Michaels'~~which ~~individual~~the ~~performance~~company ~~goals~~factor ~~related~~of tothe ~~commercial~~annual ~~strategy~~incentive ~~and~~bonus ~~execution,~~available ~~improvement~~upon inachievement ~~customer~~of ~~profitability~~this ~~and contract renewal execution~~goal.

Mr. Lovetro, Mr. Annese and Mr. Michaels each met or exceeded their individual performance goals. This performance combined with the company financial performance threshold, resulted in Annual Incentive Plan payments to Mr. Lovetro, Mr. Annese and Mr. Michaels at 92%, 94% and 100% of target, respectively

Achievement Level	2016 Performance

Maximum	125% of target	200	%
Target	100% of target	100%	*
Threshold	75% of target	50	%

*: In 2017, upon achieving 100% of target, Mr. Lovetro's company financial performance factor payout will be 125%, Mr. Annese's company financial performance factor payout will be 110% and Mr. Snyder's company financial performance factor payout will be 75%. Additionally, for 2017, the company performance target is no longer based on Adjusted EBT but will be based on Adjusted EBITDA. See Non-GAAP Measures in Management Discussion and Analysis.

For 2016, our company financial performance target was an Adjusted EBT of $124.1 million. Since we fell short of the Threshold level of Adjusted EBT, no company financial performance bonus was due. However, the Company decided to make a one-time exception and a 25% company financial performance bonus was paid to our Named Executive Officers and all eligible employees.

Achievement of the individual performance factor was determined separately for each Named Executive Officer based on an evaluation of his performance during the period with respect to specific metrics established for each individual. Achievement of these metrics is determined by Mr. Lovetro, with respect to Mr. Annese and Mr. Snyder, and by the board of directors of SCT Chassis, with respect to Mr. Lovetro. For 2016, Mr. Lovetro's individual performance goals related to business strategy and execution, operating expenses and technology strategy and execution. Mr. Annese's individual performance goals related to reduction of day's sales outstanding and bad debt expense, operating expense control and organizational effectiveness. Mr. Snyder's individual performance goals related to IT strategy and execution, IT expense management and business continuity strategy and execution.

Mr. Lovetro, Mr. Annese and Mr. Snyder each met their individual performance goals. This performance combined with the company financial performance threshold, resulted in Annual Incentive Plan payments to Mr. Lovetro and Mr. Annese at 46% and 48% of target, respectively. Mr. Snyder received an Annual Incentive Plan payment equal to 100% of his pro-rated target in accordance with his offer letter.

Additional Equity Arrangements

Each of our Named Executive Officers received an award of restricted shares of the common stock of SCT Chassis which is subject to the terms of a management shareholder agreement. ~~See~~Additionally ~~"Outstanding~~Mr. Lovetro ~~Equity~~and ~~Awards~~Mr. Annese atreceived ~~end~~awards of ~~2015"~~restricted ~~below~~stock ~~for~~units ~~disclosure~~under ofthe ~~these~~newly ~~awards.~~formed SCT

Pursuant to the terms of the Management Shareholder Agreements, subject to the execution of a valid and binding release, if a Named Executive Officer's employment is involuntarily terminated at any time, he will be entitled to accelerated vesting of the restricted shares of SCT Chassis common stock which would have vested on the following vesting date. All unvested restricted shares of SCT Chassis common stock held by a Named Executive Officer will vest, subject to execution of a valid and binding release, upon either the termination of the Named Executive Officer's employment without cause within twelve months following a change in control, or upon the termination of his employment due to his death or disability. 86

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Chassis Restricted Stock Unit Plan dated as of October 1, 2016 which is also subject to the terms of a management shareholder agreement. See "Outstanding Equity Awards at end of 2016" below for disclosure of these awards.

Pursuant to the terms of the Management Shareholder Agreements, subject to the execution of a valid and binding release, if a Named Executive Officer's employment is involuntarily terminated at any time, other than for cause, he will be entitled to accelerated vesting of the restricted shares or the restricted stock units of SCT Chassis common stock which would have vested on the following vesting date. All unvested restricted shares or restricted stock units of SCT Chassis common stock held by a Named Executive Officer will vest, subject to execution of a valid and binding release, upon either the termination of the Named Executive Officer's employment without cause within twelve months following a change in control, or upon the termination of his employment due to his death or disability.

Special Bonus Arrangements

In August 2015, we entered into special bonus arrangements with each of Mr. Lovetro and Mr. Annese pursuant to which each officer will receive bonus payments in the event of a qualifying transaction, in order to appropriately motivate management to continue their efforts in leading the Company, while providing assured continuity through the closing of a potential transaction. A qualifying transaction is defined in the letters as the sale of 50% or more of the equity of the Company or all or substantially all of its business or assets to (i) a third party; (ii) a private equity fund managed by an affiliate of Fortress Investment Group LLC ("FIG LLC") (or its successors or assigns); (iii) an investment vehicle managed directly or indirectly by FIG LLC (or its successors or assigns) or any of its affiliates; or, (iv) a general partner, limited partner, managing member or person occupying a similar role of, or with respect to, any of the foregoing. Under the terms of the agreements, Mr. Lovetro and Mr. Annese would be entitled to cash bonuses in the amount of $948,000 and $591,000, respectively, and in addition, Mr. Lovetro and Mr. Annese will be entitled to additional bonus payments of $750,000 and $400,000, respectively, if the equity value paid by the buyer in a qualifying transaction is $1.0 billion or more. Payment of the bonuses is contingent on their continued status as employees in good standing with the Company at the time of the closing of the transaction.

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401(k) Plan

We have established a tax-qualified 401(k) retirement plan for all employees of our company. Employees are eligible to participate on their first day of service. Under our 401(k) plan, employees may elect to defer and contribute to the 401(k) plan their eligible compensation up to the statutorily prescribed annual limit. We currently match contributions made by our employees, including executives, at a rate of 100% for the first 6% of eligible per pay contributions. Company matching funds are subject to a five-year vesting schedule.

~~Outstanding Equity Awards at End of 2015~~ 87

~~The~~Table ~~following table sets forth information regarding outstanding equity awards held by our Named Executive Officers as~~ of ~~December 31,~~ ~~2015. All equity awards made to our Named Executive Officers consist of restricted shares of common stock of SCT Chassis.~~ Contents

	Stock Awards
(a) Name	Number of Shares or Units of Stock That Have Not Vested (#)		Market Value of Shares or Units of Stock That Have Not Vested ($)
Keith Lovetro(1)		—	$	—
Chris Annese(1)		—	$	—
Mark Michaels(2)		49,261	$	588,668

Outstanding Equity Awards at End of 2016

The ~~(1)All shares~~following ~~granted~~table ~~are~~sets ~~fully~~forth ~~vested~~information regarding outstanding equity awards held by our Named Executive Officers as of December 31, ~~2015.~~ ~~(1)12,315 shares~~2016. ~~will~~All ~~vest~~equity onawards ~~each~~made ofto ~~January 1,~~our ~~2016,~~Named ~~2017~~Executive ~~and~~Officers ~~2018~~consist ~~and~~of ~~12,316~~restricted stock units or restricted shares ~~will~~of ~~vest~~the oncommon ~~January 1,~~stock ~~2019~~of SCT Chassis.

(a) Name	Award Type		Market Value of Shares or Units of Stock That Have Not Vested ($)

Keith Lovetro(1)	Restricted Stock Unit	40,578	$	339,235
Chris Annese(2)	Restricted Stock Unit	17,015	$	142,245
Kevin Snyder(3)	Restricted Stock	35,682	$	329,883

(1): 13,526 restricted stock units will vest on each of January 1, 2017, 2018 and 2019.
(2): 5,672 restricted stock units will vest on January 1, 2017 and 2018 with 5,671 units vesting on January 1, 2019.
(3): 8,921 restricted shares will vest on January 1, 2017 and 2018 with 8,920 restricted shares vesting on January 1, 2019 and 2020. Of the 35,682 restricted shares, 13,382 are eligible for the Stock Buyback Program and as such are valued at $10.72 per share. The remaining 22,300 restricted shares are not subject to repurchase and are therefor valued at $8.36 per share.

DIRECTOR COMPENSATION

In ~~2015~~2016 we did not pay any compensation, reimburse any expense of, or make any equity awards or non-equity awards to, members of our board of directors for their service as directors.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Interpool is wholly-owned by TRAC Intermodal LLC, which is owned by Seacastle and certain members of our management. Seacastle is owned by private equity funds that are managed by an affiliate of Fortress and by employees of affiliates of Seacastle.

Beneficial ownership for the purposes of the following table is determined in accordance with the rules and regulations of the SEC. These rules generally provide that a person is the beneficial owner of securities if such person has or shares the power to vote or direct the voting of securities, or to dispose or direct the disposition of securities or has the right to acquire such powers within 60 days. The information does not necessarily indicate beneficial ownership for any other purpose. Except as disclosed in the footnotes to this table and subject to applicable community property laws, we believe that each beneficial owner identified in the table possesses sole voting and investment power over all shares shown as beneficially owned by the beneficial owner.

The following table sets forth information regarding the beneficial ownership of the common stock of Seacastle (the "Common Stock") as of December 31, ~~2015~~2016 for each person or group who is known by us to beneficially own more than 5% of the outstanding shares of Common Stock. None of our

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executive officers or directors owns any of the Common Stock. The following table is based on 109,459,492 shares of Common Stock outstanding as of December 31, ~~2015~~2016.

Name and address of beneficial owner

5% Interest Holders(2)
Fortress Fund III Funds(3)	29,683,307	27.12	%
Fortress Fund III Coinvest Funds(3)	3,451,547	3.15	%
Fortress Fund IV Funds(3)	57,092,435	52.16	%
Fortress Fund IV Coinvest Funds(3)	17,500,358	15.99	%

(1)The address for the Fortress Fund III Funds, the Fortress Fund III Coinvest Funds, the Fortress Fund IV Funds and the Fortress Fund IV Coinvest Funds is c/o ~~Fortress~~ Fortress Investment Group LLC, 1345 Avenue of the Americas, 45th Floor, New York, New York 10105. (2)With the exception of the Fortress Fund III Coinvest Funds, which owns approximately 3% of the shares of Common Stock. (3)Fortress Fund III Funds represent Fortress Investment Fund III L.P., Fortress Investment Fund III (Fund B) L.P., Fortress Investment Fund III (Fund C) L.P., Fortress Investment Fund III (Fund D) L.P., Fortress Investment Fund III (Fund E) L.P., Fortress Investment Fund III (Coinvestment Fund A) L.P., Fortress Investment Fund III (Coinvestment Fund B) L.P., Fortress Investment Fund III (Coinvestment Fund C) L.P., and Fortress Investment Fund III (Coinvestment Fund D) L.P.. Fortress Fund IV Funds represent Fortress Investment Fund IV (Fund A) L.P., Fortress Investment Fund IV (Fund B) L.P., Fortress Investment Fund IV (Fund C) L.P., Fortress Investment Fund IV (Fund D) L.P., Fortress Investment Fund IV (Fund E) L.P., Fortress Investment Fund IV (Fund F) L.P. and Fortress Investment Fund IV (Fund G) L.P. Fortress Fund IV Coinvest Funds represent Fortress Investment Fund IV (Coinvestment Fund A) L.P., Fortress Investment Fund IV (Coinvestment Fund B) L.P., Fortress Investment Fund IV (Coinvestment Fund C) L.P., Fortress Investment Fund IV (Coinvestment Fund D) L.P., Fortress Investment Fund IV (Coinvestment Fund F) L.P. and Fortress Investment Fund IV (Coinvestment Fund G) L.P. Fortress Fund III GP LLC is the general partner of each of the Fortress Fund III Funds and each of the Fortress Fund III Coinvest Funds. The sole managing member of Fortress Fund III GP LLC is Fortress Investment Fund GP (Holdings) LLC. The sole managing member of Fortress Investment Fund GP (Holdings) LLC is Fortress Operating Entity I LP ("FOE I LP"). Fortress Fund IV GP L.P. is the general partner of each of the Fortress Fund IV Funds and each of the Fortress Fund IV Coinvest Funds. The general partner of Fortress Fund IV GP L.P. is Fortress Fund IV GP GP Holdings Ltd. The sole managing member of Fortress Fund IV GP GP Holdings Ltd. is FOE I LP. FIG Corp. is the general partner of FOE I LP, and FIG Corp. is wholly -owned by Fortress. As of December 31, ~~2015~~2016, Wesley R. Edens owned 16.3334% of Fortress. By virtue of his ownership interest in Fortress and certain of its affiliates, as well as his role in advising certain investment funds, Wesley R. Edens may be deemed to be the natural person that has sole voting and investment control over the shares beneficially owned by Seacastle. Mr. Edens disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein.

Seacastle owns Interpool indirectly through various subsidiaries. Interpool is wholly -owned by TRAC, which is wholly -owned by TRAC Intermodal Holding Corp., which is wholly -owned by SCT Chassis, Inc. ("SCT Chassis"), which is owned by Seacastle and certain members of our management.

The following table sets forth information regarding the beneficial ownership of the common stock of SCT Chassis as of December 31, 2016, for each person or group who is known by us to beneficially own more than 5% of the outstanding shares of the common stock of SCT Chassis, each of our

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The following table sets forth information regarding the beneficial ownership of the common stock of SCT Chassis as of December 31, 2015, for each person or group who is known by us to beneficially own more than 5% of the outstanding shares of the common stock of SCT Chassis, each of our directors and executive officers and for all of our directors and executive officers as a group. The following table is based on 69,044,081 shares of common stock of SCT Chassis outstanding as of December 31, ~~2015~~2016.

Name and address of beneficial owner(1)
5% Interest Holders
Seacastle	68,529,988	99.26	%
Directors and Executive Officers
Keith Lovetro	6456,~~518~~877	*
Chris Annese	5847,~~325~~303	*
Gregg Carpene	4638,~~511~~530	*
Val Noel	2926,~~406~~420	*
Mark Michaels	1213,~~315~~532	*
All directors and executive officers as a group (5 persons)	211,075	*
Kevin Snyder	5,597	*
Other stockholders as a group(2)	303,018	*
All directors and executive officers as a group (6 persons)	188,259	*
Other stockholders as a group(2)	325,834	*

*Percentage is less than 1% of the total number of outstanding shares of common stock. (1)The address for Seacastle and for each of the directors and executive officers is c/o Interpool, Inc., 750 College Road East, Princeton, New ~~Jersey~~ Jersey 08540. (2)Includes ~~131~~150,~~327~~156 shares of common stock of SCT Chassis held by Interpool.

For further information regarding material transactions between us and certain of our stockholders, see "Certain relationships and related party transactions."

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Disclosure of transactions with related persons

Other than as set forth below, we do not have any material related party transactions.

•: We have incurred charges for reimbursement of rent-related expenses for facilities and for share-based compensation from Seacastle relating to a compensation plan pursuant to which our employees were granted common stock of SCT Chassis.
•: We charge management fees for limited financial and legal services to a subsidiary of Seacastle including a portion of share-based compensation related to these employees and an insurance allocation. The expense and cost allocations have been determined based upon estimates of hours worked and services rendered and we believe the estimates and assumptions used in deriving such allocations are reasonable and would not have been materially different if negotiated independently.
•: We lease chassis to the Florida East Coast Railway ("FEC") under term lease and pool agreements. The parent company to the FEC is Florida East Coast Industries, Inc., which is owned by private equity funds managed by affiliates of Fortress.

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•: As of December 31, 2016, our Vice President of TRAC Interstar, Rodney Goderwis, owned a majority equity position in Core Fleet Retreading ("Core"), a company from whom we purchase tires. In addition, Mr. Goderwis owned a minority equity position in each of INA Towing Network ("INA") and Caliber Information Systems ("Caliber") from whom we purchase towing services and maintenance and repair cost control services, respectively. Mr. Goderwis was also a director of Core and INA. Since Mr. Goderwis joined TRAC Interstar in March, 2016 in connection with the Interstar Acquisition, we have incurred expenses in the amount of $4,022, $226 and $1,344 from Core and affiliates, INA and Caliber, respectively.

	Year ended December 31,
(dollars in thousands)	~~2015~~2016			~~2014~~2015		~~2013~~2014
Fees charged to related parties:
Management fees	$	33—		$	~~259~~33	$	~~435~~259
Total revenue		2,~~242~~359			12,~~766~~242		1,~~028~~766
Share-based compensation		—			13—		4213
Insurance allocation		9689			9396		8993
Charges incurred from related parties:
Charges (incurred) from related parties:
Facility fees		—			~~258~~—		~~270~~(258	)
Tire purchases		(4,022	)		—		—
Towing services		(226	)		—		—
Cost control services		(1,344	)		—		—

Net fees charged:	$	2,371		$	1,873	$	1,324
Net fees (incurred) charged:	$	(3,144	)	$	2,371	$	1,873

In addition to the above, during 2013, we received a one-time stock distribution in a related company that resulted in a tax gain of $56.1 million without producing a corresponding book gain. We recorded a non-cash tax provision related to this gain of $22.1 million. The recognized tax gain was fully offset by net operating loss carryforwards.

For a brief description of our related party transactions, please see Note 15 "Related Party Transactions" to our Consolidated Financial Statements.

Disclosure of Interpool's policy for review, approval or ratification of transactions with related persons.

Under SEC rules, a related person is an officer, director, nominee for director or beneficial holder of more than 5% of any class of our voting securities since the beginning of the last fiscal year or an immediate family member of any of the foregoing. Interpool's Board of Directors is primarily responsible for developing and ~~implementing~~ implementing processes and controls to obtain information from our directors, executive officers and significant stockholders regarding related-person transactions and then determining, based on the facts and circumstances, whether we or a related person has a direct or indirect material interest in these transactions. We ~~currently do not~~ have adeveloped ~~standalone~~and ~~written~~implemented ~~policy~~procedures for evaluating related party transactions. Our officers and directors use a Related Party Policy process to review, approve and ratify transactions with related parties. When considering potential transactions involving a related party, members of management notify our Board of Directors of the proposed transaction, provide a brief background of the transaction and meet with the Board of Directors to review the matter. At such meetings, members of management provide information to the Board of Directors regarding the proposed transaction, after which the Board of Directors and management discuss the transaction and the implications of engaging a related party as opposed to an unrelated third party. If the Board of Directors (or specified managers as required by applicable legal requirements) determines that the transaction is in our best interests, we will enter into the transaction with the applicable related party. Other than compensation agreements and other arrangements which are described under "Compensation Discussion and Analysis" and the transactions described above, since December 31, 2009, there has not been, and there is not currently proposed, any transaction or series of similar transactions to which we were or will be a party in which the amount involved exceeded or will exceed $120,000 and in which any related person had or will have a direct or indirect material interest.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Accounting Fees and Services

The following table sets forth the aggregate fees billed to the Company by Ernst & Young LLP for professional services ~~rendered~~ rendered for the years ended December 31, ~~2015~~2016 and ~~2014~~2015:

	Year ended December 31,
	2015		2014
	2016		2015
Audit Fees(1)	$	1,~~200~~261,~~702~~187	$	1,~~040~~200,~~250~~702
Tax Fees(2)		5579,~~885~~755		4255,~~304~~885
All Other Fees(3)		1,995		1,995

Total Fees	$	1,~~258~~342,~~582~~937	$	1,~~084~~258,~~549~~582

(1): "Audit Fees" include audit fees for professional services rendered in connection with the audit of our annual financial statements, reviews of our quarterly financial statements and comfort letter procedures.
(2): "Tax Fees" include tax compliance, assistance with tax audits, tax advice and tax planning
(3): "All Other Fees" include various miscellaneous services.

Pre-Approval of Audit and Non-Audit Services

The audit committee is responsible for appointing the Company's independent auditors and approving the terms of the independent auditors' services. The audit committee has established a policy for the pre-approval of all audit and permissible non-audit services to be provided by the independent auditors. All of the services listed in the above table were approved pursuant to this policy.

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PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES

(A): 1. Consolidated Financial Statements

(A) 1. Consolidated Financial Statements


The following financial statements are included pursuant to Item 8 of this report:
Report of Independent Registered Public Accounting Firm			F-2
Consolidated Balance Sheets at December 31, 2016 and 2015			F-3
Consolidated Statements of Operations for the Years Ended December 31, 2016, 2015 and 2014			F-4
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2016, 2015 and 2014			F-5
Consolidated Statements of Member's Interest for the Years Ended December 31, 2016, 2015 and 2014			F-6
Consolidated Statements of Cash Flows for the Years Ended December 31, 2016, 2015 and 2014			F-7
Notes to Consolidated Financial Statements			F-8
(A) 2. Financial Statement Schedules
Schedule II—Valuation and Qualifying Accounts for the Years Ended December 31, 2016, 2015 and 2014			F-62

The following financial statements are included pursuant to Item 8 of this report:

Report of Independent Registered Public Accounting Firm			F-2
Consolidated Balance Sheets at December 31, 2015 and 2014			F-3
Consolidated Statements of Operations for the Years Ended December 31, 2015, 2014 and 2013			F-4
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2015, 2014 and 2013			F-5
Consolidated Statements of Member's Interest for the Years Ended December 31, 2015, 2014 and 2013			F-6
Consolidated Statements of Cash Flows for the Years Ended December 31, 2015, 2014 and 2013			F-7
Notes to Consolidated Financial Statements			F-8

(A) 2. Financial Statement Schedules

Schedule II—Valuation and Qualifying Accounts for the Years Ended December 31, 2015, 2014 and 2013 F-59

Schedules not listed above have been omitted because the information required to be set forth therein is not applicable or is shown in the accompanying consolidated financial statements or notes thereto.

(A): 3. LIST OF EXHIBITS

(A) 3. LIST OF EXHIBITS

Exhibit Number		Description

3.1.1		Certificate of Formation of TRAC Intermodal LLC (incorporated by reference to Exhibit 3.1.1 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
3.2.1		Limited Liability Company Agreement of TRAC Intermodal LLC (incorporated by reference to Exhibit 3.2.1 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
4.1		Indenture, dated as of August 9, 2012, by and among TRAC Intermodal LLC, TRAC Intermodal Corp., the guarantors named therein and Wells Fargo Bank, National Association, as Trustee and Notes Collateral Agent relating to the 11% Senior Secured Notes due 2019 (the "Indenture") (incorporated by reference to Exhibit 4.1 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
4.2		Supplemental Indenture, dated as of March 15, 2013, among TRAC Drayage LLC, TRAC Logistics LLC, the guarantors party thereto and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.2 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
4.3		Second Supplemental Indenture, dated as of October 21, 2015, by and among TRAC Intermodal LLC, TRAC Intermodal Corp., TRAC Chassis Pool Management LLC, TRAC Services LLC and Wells Fargo Bank, National Association, as trustee and as notes collateral agent (incorporated by reference to Exhibit 4.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on October 23, 2015).

Exhibit Number			Description
	3.1.1		Certificate of Formation of TRAC Intermodal LLC (incorporated by reference to Exhibit 3.1.1 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
	3.2.1		Limited Liability Company Agreement of TRAC Intermodal LLC (incorporated by reference to Exhibit 3.2.1 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
	4.1		Indenture, dated as of August 9, 2012, by and among TRAC Intermodal LLC, TRAC Intermodal Corp., the guarantors named therein and Wells Fargo Bank, N.A., as Trustee and Notes Collateral Agent relating to the 11% Senior Secured Notes due 2019 (the "Indenture") (incorporated by reference to Exhibit 4.1 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
	4.2		Supplemental Indenture, dated as of March 15, 2013, among TRAC Drayage LLC, TRAC Logistics LLC, the guarantors party thereto and Wells Fargo Bank, N.A., as Trustee (incorporated by reference to Exhibit 4.2 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).

Table of Contents

Exhibit Number		Description	~~Description~~
	4.3		Second Supplemental Indenture, dated as of October 21, 2015, by and among TRAC Intermodal LLC, TRAC Intermodal Corp., TRAC Chassis Pool Management LLC, TRAC Services LLC and Wells Fargo Bank, N.A., as trustee and as notes collateral agent (incorporated by reference to Exhibit 4.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on October 23, 2015).
4.4		Third Supplemental Indenture, dated as of March 24, 2016, by and among TRAC Intermodal LLC, TRAC Intermodal Corp., TRAC Interstar LLC and Wells Fargo Bank, National Association, as trustee and as notes collateral agent (incorporated by reference to Exhibit 4.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on March 28, 2016).
10.1	~~10.1~~	$725,000,000 Credit Agreement, dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).	$725,000,000 Credit Agreement, dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
10.2	~~10.2~~	Amendment No. 1, dated as of December 20, 2012, to the Credit Agreement, dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).	Amendment No. 1, dated as of December 20, 2012, to the Credit Agreement dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
10.3	~~10.3~~	Incremental Facility Amendment, dated as of December 20, 2012, to the Credit Agreement, dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.3 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).	Incremental Facility Amendment, dated as of December 20, 2012, to the Credit Agreement dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.3 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
10.4	~~10.4~~	Incremental Facility Amendment, dated as of January 24, 2013, to the Credit Agreement, dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.4 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 as filed with the SEC on March 18, 2013).	Incremental Facility Amendment, dated as of January 24, 2013, to the Credit Agreement dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.4 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 as filed with the SEC on March 18, 2013).
10.5	~~10.5~~	Incremental Facility Amendment, dated as of March 4, 2013, to the Credit Agreement, dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.5 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).	Incremental Facility Amendment, dated as of March 4, 2013, to the Credit Agreement dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.5 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
10.6	~~10.6~~	Incremental Facility Amendment, dated as of June 3, 2013, to the Credit Agreement, dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.6 to TRAC Intermodal LLC's Annual Report on Form 10-K filed with the SEC on March 25, 2014).	Incremental Facility Amendment, dated as of June 3, 2013, to the Credit Agreement dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.6 to TRAC Intermodal LLC's Annual Report on Form 10-K filed with the SEC on March 25, 2014).
10.7	~~10.7~~	Incremental Facility Amendment, dated as of July 31, 2013, to the Credit Agreement, dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on August 2, 2013).	Incremental Facility Amendment, dated as of July 31, 2013, to the Credit Agreement dated as of August 9, 2012, by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on August 2, 2013).

Table of Contents

Exhibit Number		Description	~~Description~~
10.8	~~10.8~~	Incremental Facility Amendment, dated as of April 15, 2014, to the Credit Agreement, dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on April 18, 2014).	Incremental Facility Amendment, dated as of April 15, 2014, to the Credit Agreement dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on April 18, 2014).
10.9	~~10.9~~	Amendment No. 2, dated as of April 15, 2014, to the Credit Agreement, dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on April 18, 2014).	Amendment No. 2, dated as of April 15, 2014, to the Credit Agreement dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on April 18, 2014).
10.10	~~10.10~~	Incremental Facility Amendment, dated as of November 25, 2014, to the Credit Agreement, dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on November 26, 2014).	Incremental Facility Amendment, dated as of November 25, 2014, to the Credit Agreement dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on November 26, 2014).
10.11	~~10.11~~	Incremental Facility Amendment, dated as of December 10, 2014, to the Credit Agreement, dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on December 12, 2014).	Incremental Facility Amendment, dated as of December 10, 2014, to the Credit Agreement dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on December 12, 2014).
10.12	~~10.12~~	Amendment No. 3, dated as of August 11, 2015, to the Credit Agreement, dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 10-Q filed with the SEC on August 12, 2015).	Amendment No. 3, dated as of August 11, 2015, to the Credit Agreement dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 10-Q filed with the SEC on August 12, 2015).
10.13	~~10.13~~	Incremental Facility Amendment, dated as of August 11, 2015, to the Credit Agreement, dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, J.P. Morgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Current Report on Form 10-Q filed with the SEC on August 12, 2015).	Incremental Facility Amendment, dated as of August 11, 2015, to the Credit Agreement dated as of August 9, 2012 by and among Interpool, Inc., the other Loan Parties identified therein, JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Securities LLC and the lenders party thereto (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Current Report on Form 10-Q filed with the SEC on August 12, 2015).
10.14	~~10.14~~	Joinder Agreement, dated as of October 21, 2015, by and between TRAC Chassis Pool Management LLC and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on October 23, 2015).	Joinder Agreement, dated as of October 21, 2015, by and between TRAC Chassis Pool Management LLC and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on October 23, 2015).
10.15	~~10.15~~	Joinder Agreement, dated as of October 21, 2015, by and between TRAC Services LLC and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on October 23, 2015).	Joinder Agreement, dated as of October 21, 2015, by and between TRAC Services LLC and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on October 23, 2015).
10.16	~~10.16~~	Amendment No. 4, dated as of December 10, 2015, to the Credit Agreement, dated as of August 9, 2012 by and among Interpool, Inc., the other loan parties identified therein, the lenders party thereto and Bank of America, N.A., as successor administrative agent (as successor in interest to JPMorgan Chase Bank, N.A.) (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on December 16, 2015).	Amendment No. 4, dated as of December 10, 2015, to the Credit Agreement dated as of August 9, 2012 by and among Interpool, Inc., the other loan parties identified therein, the lenders party thereto and Bank of America, N.A., as successor administrative agent (as successor in interest to JPMorgan Chase Bank, N.A.) (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on December 16, 2015).

Table of Contents

Exhibit Number		Description	~~Description~~
10.17	~~10.17~~	Incremental Facility Amendment, dated as of December 14, 2015, to the Credit Agreement, dated as of August 9, 2012 by and among Interpool, Inc., the other loan parties identified therein, the lenders party thereto and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on December 16, 2015).	Incremental Facility Amendment, dated as of December 14, 2015, to the Credit Agreement dated as of August 9, 2012 by and among Interpool, Inc., the other loan parties identified therein, the lenders party thereto and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on December 16, 2015).
10.18	~~10.18~~	Joinder Agreement, dated as of March 24, 2016, by and between TRAC Interstar LLC and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on March 28, 2016).	Agreement of Lease, dated as of August 1, 2014, by and between ML7 College Road, LLC as Landlord, and Interpool, Inc. d/b/a TRAC Intermodal as Tenant (incorporated by reference to Exhibit 10.03 to TRAC Intermodal LLC's Quarterly Report on Form 10-Q filed with the SEC on August 12, 2014).
10.19	~~10.19~~	Agreement of Lease, dated as of August 1, 2014, by and between ML 7 College Road, LLC as Landlord, and Interpool, Inc. d/b/a TRAC Intermodal as Tenant (incorporated by reference to Exhibit 10.03 to TRAC Intermodal LLC's Quarterly Report on Form 10-Q filed with the SEC on August 12, 2014).	Management Shareholder Agreement, dated June 1, 2012, between Interpool Inc. d/b/a TRAC Intermodal, Seacastle Inc., SCT Chassis Inc., and Keith Lovetro (incorporated by reference to Exhibit 10.6 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
10.20	~~10.20~~	Management Shareholder Agreement, dated June 1, 2012, between Interpool Inc. d/b/a TRAC Intermodal, Seacastle Inc., SCT Chassis Inc., and Keith Lovetro (incorporated by reference to Exhibit 10.6 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).	Management Shareholder Agreement, dated June 1, 2012, between Interpool Inc. d/b/a TRAC Intermodal, Seacastle Inc., SCT Chassis Inc., and David Serxner (incorporated by reference to Exhibit 10.7 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
10.21	~~10.21~~	Management Shareholder Agreement, dated June 1, 2012, between Interpool Inc. d/b/a TRAC Intermodal, Seacastle Inc., SCT Chassis Inc., and Christopher Annese (incorporated by reference to Exhibit 10.8 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).	Management Shareholder Agreement, dated June 1, 2012, between Interpool Inc. d/b/a TRAC Intermodal, Seacastle Inc., SCT Chassis Inc., and Christopher Annese (incorporated by reference to Exhibit 10.8 to TRAC Intermodal LLC's Draft Registration Statement on Form S-4 filed with the SEC on March 18, 2013).
10.22	~~10.22~~	Management Shareholder Agreement, dated December 1, 2013, between Interpool Inc. d/b/a TRAC Intermodal, SCT Chassis Inc., and Val Noel (incorporated by reference to Exhibit 10.11 to TRAC Intermodal LLC's Annual Report on Form 10-K filed with the SEC on March 25, 2014).	Management Shareholder Agreement, dated December 1, 2013, between Interpool Inc. d/b/a TRAC Intermodal, SCT Chassis Inc., and Val Noel (incorporated by reference to Exhibit 10.11 to TRAC Intermodal LLC's Annual Report on Form 10-K filed with the SEC on March 25, 2014).
10.23	~~10.23~~	Amendment to Management Shareholder Agreement, dated as of January 1, 2015, between Interpool Inc. d/b/a TRAC Intermodal, Seacastle Inc., SCT Chassis Inc., and Christopher Annese (incorporated by reference to Exhibit 10.18 to TRAC Intermodal LLC's Annual Report on Form 10-K filed with the SEC on March 24, 2015).	General Release dated as of August 26, 2013 by and among Interpool Inc. d/b/a TRAC Intermodal, Seacastle Inc., SCT Chassis Inc., and David Serxner (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Current Report on Form 8-K filed with the SEC on October 9, 2013).
10.24	~~10.24~~	Management Shareholder Agreement, dated June 1, 2015, between Interpool Inc. d/b/a TRAC Intermodal, SCT Chassis Inc., and Mark Michaels (incorporated by reference to Exhibit 10.25 to TRAC Intermodal LLC's Annual Report on Form 10-K filed with the SEC on March 4, 2016).	Amendment to Management Shareholder Agreement, dated as of January 1, 2015, between Interpool Inc. d/b/a TRAC Intermodal, Seacastle Inc., SCT Chassis Inc., and Christopher Annese (incorporated by reference to Exhibit 10.18 to TRAC Intermodal LLC's Annual Report on Form 10-K filed with the SEC on March 24, 2015).
10.25	~~10.25~~	Management Shareholder Agreement, dated June 1, 2016, between Interpool Inc. d/b/a TRAC Intermodal, SCT Chassis Inc., and Kevin Snyder (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Quarterly Report on Form 10-Q filed with the SEC on August 10, 2016).	~~Management Shareholder Agreement, dated June 1, 2015, between Interpool Inc. d/b/a TRAC Intermodal, SCT Chassis Inc., and Mark Michaels.~~
10.26	~~10.26~~	Form of Stock Buyback Letter (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Quarterly Report on Form 10-Q filed with the SEC on May 11, 2016).	~~Form of Letter Agreements.~~
	21.1		List of subsidiaries of TRAC Intermodal LLC.
10.27		SCT Chassis Inc. Restricted Stock Unit Plan (incorporated by reference to Exhibit 10.1 to TRAC Intermodal LLC's Quarterly Report on Form 10-Q filed with the SEC on November 9, 2016).
	31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Table of Contents

Exhibit Number		Description	~~Description~~
	32.2		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
10.28		Form of Restricted Stock Unit Award Agreement (incorporated by reference to Exhibit 10.2 to TRAC Intermodal LLC's Quarterly Report on Form 10-Q filed with the SEC on November 9, 2016).
	101.INS		XBRL Instance Document
21.1		List of subsidiaries of TRAC Intermodal LLC.
	101.SCH		XBRL Taxonomy Extension Schema Document
31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	101.LAB		XBRL Taxonomy Extension Label Linkbase Document
32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document
101.INS		XBRL Instance Document.
101.SCH		XBRL Taxonomy Extension Schema Document.
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.

ITEM 16. FORM 10-K SUMMARY

None.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		TRAC Intermodal LLC Registrant
		By:		/s/ CHRIS ANNESE Chris Annese Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Manager of the registrant
		Date: March 4, 2016
		Date: March 7, 2017

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ KEITH LOVETRO Keith Lovetro		Chief Executive Officer (Principal Executive Officer) and Manager of the registrant
/s/ KEITH LOVETRO Keith Lovetro Date: March 7, 2017		Chief Executive Officer (Principal Executive Officer) and Manager of the registrant
Date: March 4, 2016
/s/ CHRIS ANNESE Chris Annese Date: March 7, 2017		Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Manager of the registrant
/s/ CHRIS ANNESE Chris Annese Date: March 4, 2016		Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) and Manager of the registrant
/s/ GREGG CARPENE Gregg Carpene Date: March 7, 2017		General Counsel and Manager of the registrant
/s/ GREGG CARPENE Gregg Carpene		General Counsel and Manager of the registrant
Date: March 4, 2016

Table of Contents

INDEX TO FINANCIAL STATEMENTS ~~TRAC Intermodal LLC and Subsidiaries Years Ended December 31, 2015, 2014 and 2013~~

Report of Independent Registered Public Accounting Firm			F-2
Consolidated Balance Sheets at December 31, 2015 and 2014			F-3
Consolidated Statements of Operations For the Years Ended December 31, 2015, 2014 and 2013			F-4
Consolidated Statements of Comprehensive Income (Loss) For the Years Ended December 31, 2015, 2014 and 2013			F-5
Consolidated Statements of Member's Interest For the Years Ended December 31, 2015, 2014 and 2013			F-6
Consolidated Statements of Cash Flows For the Years Ended December 31, 2015, 2014 and 2013			F-7
Notes to Consolidated Financial Statements			F-8
Schedule II—TRAC Intermodal LLC Valuation and Qualifying Accounts For the Years Ended December 31, 2015, 2014 and 2013			F-59

TRAC Intermodal LLC and Subsidiaries

Years Ended December 31, 2016, 2015 and 2014


Report of Independent Registered Public Accounting Firm			F-2
Consolidated Balance Sheets at December 31, 2016 and 2015			F-3
Consolidated Statements of Operations For the Years Ended December 31, 2016, 2015 and 2014			F-4
Consolidated Statements of Comprehensive Income (Loss) For the Years Ended December 31, 2016, 2015 and 2014			F-5
Consolidated Statements of Member's Interest For the Years Ended December 31, 2016, 2015 and 2014			F-6
Consolidated Statements of Cash Flows For the Years Ended December 31, 2016, 2015 and 2014			F-7
Notes to Consolidated Financial Statements			F-8
Schedule II—TRAC Intermodal LLC Valuation and Qualifying Accounts For the Years Ended December 31, 2016, 2015 and 2014			F-62

F-1

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Member
TRAC Intermodal LLC

We have audited the accompanying consolidated balance sheets of TRAC Intermodal LLC and Subsidiaries as of December 31, ~~2015~~2016 and ~~2014~~2015 and the related consolidated statements of operations, comprehensive income (loss), member's interest and cash flows for each of the three years in the period ended December 31, ~~2015~~2016. Our audits also included the financial statement schedule listed in the index on page F-1. These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our ~~audits~~December 31, 2016 audit in accordance with the standards of the Public Company Accounting Oversight Board (United States) and in accordance with auditing standards generally accepted in the United States of America. We conducted our December 31, 2015 audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company's internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of TRAC Intermodal LLC and Subsidiaries at December 31, ~~2015~~2016 and ~~2014~~2015, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, ~~2015~~2016 in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

/s/ Ernst & Young LLP ~~Iselin, New Jersey March 4, 2016~~

Iselin, New Jersey
March 7, 2017

F-2

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TRAC Intermodal LLC and Subsidiaries Consolidated Balance Sheets At December 31, ~~2015~~2016 and ~~2014~~2015 (Dollars in Thousands)

	December 31
	2015		2014
	2016		2015
Assets
Cash and cash equivalents	$	315,~~161~~620	$	43,~~256~~161
Accounts receivable, net of allowances of $12,454 and $19,030, respectively		110,662		135,076
Accounts receivable, net of allowances of $14,043 and $12,454, respectively		96,898		110,662
Net investment in direct finance leases		1211,~~797~~306		1612,~~215~~797
Leasing equipment, net of accumulated depreciation of $452,962 and $400,408, respectively		1,435,978		1,436,909
Leasing equipment, net of accumulated depreciation of $482,104 and $452,962, respectively		1,408,370		1,435,978
Goodwill		~~251~~256,~~907~~815		251,907
Other assets		3256,~~991~~842		2032,~~399~~991

Total assets	$	1,~~847~~845,~~496~~851	$	1,~~864~~847,~~762~~496



Liabilities and member's interest
Accounts payable	$	1315,~~593~~345	$	1413,~~781~~593
Accrued expenses and other liabilities		7547,~~340~~285		7475,~~449~~340
Deferred income taxes, net		~~127~~147,~~580~~765		~~102~~127,~~467~~580
Debt and capital lease obligations:
Due within one year		419,~~396~~173		3041,~~546~~396
Due after one year		1,~~039~~088,~~283~~228		1,~~133~~039,~~676~~283

Total debt and capital lease obligations		1,~~080~~097,~~679~~401		1,~~164~~080,~~222~~679
Less unamortized debt issuance costs		1813,~~350~~244		2118,~~555~~350

Total debt and capital lease obligations less debt issuance costs		1,~~062~~084,~~329~~157		1,~~142~~062,~~667~~329

Total liabilities		1,~~278~~294,~~842~~552		1,~~334~~

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