| Item 1.01 |
Entry into a Material Definitive Agreement. |
Indenture with respect to 4.625% Senior Notes due 2031 and 5.300% Senior Notes due 2036
On March 12, 2026, GABX Leasing LLC (the “Issuer”), a joint venture between GATX Corporation (“GATX”) and Brookfield Infrastructure Partners L.P. and its institutional partners (collectively, “Brookfield”), issued and sold $500,000,000 aggregate principal amount of 4.625% Senior Notes due 2031 (the “2031 Notes”) and $500,000,000 aggregate principal amount of 5.300% Senior Notes due 2036 (the “2036 Notes” and, together with the 2031 Notes, the “Notes”) under an Indenture, dated as of March 12, 2026 (the “Indenture”), by and among the Issuer, GATX, as guarantor, and U.S. Bank Trust Company, National Association, as trustee (in such capacity, the “Trustee”). The Notes were sold only to persons reasonably believed to be qualified institutional buyers in reliance on the exemption from registration provided by Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to non-U.S. persons outside the United States in reliance on Regulation S under the Securities Act.
The 2031 Notes were issued at 99.860% of their par value and bear interest at a rate of 4.625% per annum. Interest on the 2031 Notes is payable semi-annually in arrears on April 15 and October 15, beginning October 15, 2026. The 2031 Notes mature on April 15, 2031. The 2036 Notes were issued at 99.799% of their par value and bear interest at a rate of 5.300% per annum. Interest on the 2036 Notes is payable semi-annually in arrears on April 15 and October 15, beginning October 15, 2026. The 2036 Notes mature on April 15, 2036.
The net proceeds of the offering of the Notes, estimated at approximately $989.5 million, will be used to repay a portion of the term loan outstanding under the Issuer’s credit agreement.
Ranking; Guarantee
The Notes are the Issuer’s senior unsecured obligations, ranking equally in right of payment with all of the Issuer’s existing and future unsubordinated indebtedness and senior in right of payment to all of the Issuer’s existing and future subordinated indebtedness. The Notes are effectively junior to any existing or future secured indebtedness of the Issuer, to the extent of the value of the assets securing such indebtedness, and structurally subordinated to any existing or future indebtedness and other obligations of the Issuer’s subsidiaries.
The Notes are guaranteed, fully, irrevocably and unconditionally, on a senior unsecured basis, by GATX (the “Guarantee”). The Guarantee ranks equally in right of payment with all other existing and future unsubordinated indebtedness of GATX and senior in right of payment to all existing and future subordinated indebtedness of GATX. The Guarantee is effectively junior to any existing or future secured indebtedness of GATX to the extent of the value of the collateral securing such indebtedness, and structurally subordinated to any existing or future indebtedness and other obligations of GATX’s subsidiaries (other than the Issuer), none of which guarantee the Notes.
Optional Redemption
The 2031 Notes will be redeemable, in whole at any time, or in part, from time to time, at the Issuer’s option, prior to March 15, 2031 (one month prior to the maturity date) (the “2031 Par Call Date”), at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of (i) 100% of the aggregate principal amount of the 2031 Notes to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the 2031 Notes being redeemed, assuming that the 2031 Notes to be redeemed matured on the 2031 Par Call Date, discounted to the date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the Indenture), plus 15 basis points, less interest accrued to the redemption date, plus, in either case, accrued and unpaid interest on the 2031 Notes being redeemed to, but excluding, the redemption date.
The 2036 Notes will be redeemable, in whole at any time, or in part, from time to time, at the Issuer’s option, prior to January 15, 2036 (three months prior to the maturity date) (the “2036 Par Call Date”), at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of (i) 100% of the aggregate principal amount of the 2036 Notes to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the 2036 Notes being redeemed, assuming that the 2036 Notes to be redeemed matured on the 2036 Par Call Date, discounted to the date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, plus 20 basis points, less interest accrued to the redemption date, plus, in either case, accrued and unpaid interest on the 2036 Notes being redeemed to, but excluding, the redemption date.
