UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x
FORM 10-Q

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2017

Or

For the quarterly period ended September 30, 2018¨
OR
☐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: 001-37552

DOUBLE EAGLE ACQUISITION CORP.


Commission File Number: 001-37552 
wsc-20180930_g1.jpg
WILLSCOT CORPORATION
(formerly known as Double Eagle Acquisition Corp.)
(Exact name of registrant as specified in its charter)

Cayman IslandsN/A
Delaware 82-3430194 
(State or other jurisdiction of incorporation) (I.R.S. Employer
incorporation or organization)Identification No.)

2121 Avenue of the Stars, Suite 2300

Los Angeles, CA 90067

(310) 209-7280

901 S. Bond Street, #600
Baltimore, Maryland 21231
(Address, including zip code, andof principal executive offices)
(410) 931-6000
(Registrant’s telephone number, including area code,

of registrant’s principal executive offices)

code)

Indicate by check mark whether 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 requirements for the past 90 days.

Yesx☒No¨

☐

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 RegulationRegulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yesx☒No¨

☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company”company,” and “emerging growth company” in Rule 12b-212b‑2 of the Exchange Act.

Large accelerated filer¨☐
Accelerated filerx☒
Non-accelerated filer¨(Do not check if a smaller reporting company)☐
Smaller reporting company¨☐
Emerging growth company ☒

Emerging growth companyx

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.¨

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-212b‑2 of the Exchange Act). Yesx☐No¨

As☒

Shares of November 8, 2017, the registrant had 49,704,329 of its Class A ordinary shares,common stock, par value $0.0001 per share, outstanding, and 12,500,000outstanding: 100,303,156 shares at November 1, 2018.
Shares of its Class B ordinary shares outstanding.

common stock, par value $0.0001 per share, outstanding: 8,024,419 shares at November 1, 2018.

DOUBLE EAGLE ACQUISITION CORP.

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION





1




WILLSCOT CORPORATION
Quarterly Report on Form 10-Q
Table of Contents

ITEM 1. FINANCIAL STATEMENTSPART I Financial Information
3
Item 1
Financial Statements (unaudited)
Condensed Consolidated Balance Sheets as of September 30, 2017 (unaudited)2018 and December 31, 20162017
3
Condensed Consolidated Statements of Operations for the threeThree and nine months endedNine Months Ended September 30, 2018 and 2017
Condensed Consolidated Statements of Comprehensive Loss for the Three and Nine Months Ended September 30, 2016 (unaudited)2018 and 2017
4
Condensed Consolidated Statement of Changes in Shareholders’ Equity for the nine months endedNine Months Ended September 30, 2017 (unaudited)52018 
CondensedCondensed Consolidated Statements of Cash Flows for the nine months endedNine Months Ended September 30, 2017 (unaudited)2018 and September 30, 2016 (unaudited)2017
6
Notes to the Condensed Consolidated Financial Statements
7
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSItem 2
15
Cautionary Note Regarding Forward-Looking Statements15
Overview15
Management’s Discussion and Analysis of Financial Condition and Results of Operations18
LiquidityItem 3
Quantitative and Capital ResourcesQualitative Disclosures About Market Risk
18
Critical Accounting Policies
20Item 4
Controls and Procedures
PART II Other Information
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
20Item 1
Legal Proceedings
Item 1A
Risk Factors
ITEM 4. CONTROLS AND PROCEDURES
21Item 2
Unregistered Sales of Equity Securities and Use of Proceeds
Item 3
Defaults Upon Senior Securities
PART II. OTHER INFORMATION
Item 4
Mine Safety Disclosures
Item 5
Other Information
ITEM 1. LEGAL PROCEEDINGS
21Item 6
Exhibits
SIGNATURE
ITEM 1A. RISK FACTORS21
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS21
ITEM 3. DEFAULTS UPON SENIOR SECURITIES21
ITEM 4. MINE SAFETY DISCLOSURES21
ITEM 5. OTHER INFORMATION22
ITEM 6. EXHIBITS22

2 


2


PART I – FINANCIAL INFORMATION

Item

ITEM 1. Financial Statements

DOUBLE EAGLE ACQUISITION CORP.

CONDENSED BALANCE SHEETS

  September 30,
2017		  December 31,
2016		 
  (unaudited)    
ASSETS:        
Current assets:        
Cash and cash equivalents $13,326  $188,063 
Prepaid expenses  25,732   73,441 
Total Current Assets  39,058   261,504 
         
Cash and investments held in Trust Account  500,828,554   501,340,910 
         
Total assets $500,867,612  $501,602,414 
         
LIABILITIES AND SHAREHOLDERS’ EQUITY:        
Current liabilities:        
Accounts payable $1,703,453  $75,671 
Advances from Sponsor  380,000   - 
Total Current liabilities  2,083,453   75,671 
         
Deferred underwriting compensation  19,500,000   19,500,000 
         
Total liabilities  21,583,453   19,575,671 
         
Class A Ordinary shares subject to possible redemption; 47,428,415 shares and 47,702,674 shares at September 30, 2017 and December 31, 2016, respectively  474,284,150   477,026,740 
         
Shareholders’ equity:        
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding  —   — 
Class A ordinary shares, $0.0001 par value; 380,000,000 Class A ordinary shares authorized, 2,275,914 and 2,297,326 Class A shares issued and outstanding (excluding 47,428,415 and 47,702,674 shares, respectively subject to possible redemption) at September 30, 2017 and December 31, 2016, respectively  228   230 
Class B ordinary shares, $0.0001 par value, 20,000,000 Class B ordinary shares authorized; 12,500,000 Class B shares issued and outstanding at September 30, 2017 and December 31, 2016  1,250   1,250 
Additional paid-in capital  4,221,097   4,456,671 
Retained earnings  777,434   541,852 
Total shareholders’ equity  5,000,009   5,000,003 
Total liabilities and shareholders’ equity $500,867,612  $501,602,414 

WillScot Corporation
Condensed Consolidated Balance Sheets
(in thousands, except share data)September 30, 2018 (unaudited) December 31, 2017 
Assets 
Cash and cash equivalents $9,771 $9,185 
Trade receivables, net of allowances for doubtful accounts at September 30, 2018 and December 31, 2017 of $7,913 and $4,845, respectively 199,461 94,820 
Inventories 21,348 10,082 
Prepaid expenses and other current assets 20,075 13,696 
Total current assets 250,655 127,783 
Rental equipment, net 1,949,403 1,040,146 
Property, plant and equipment, net 193,154 83,666 
Goodwill 267,764 28,609 
Intangible assets, net 132,519 126,259 
Other non-current assets 4,200 4,279 
Total long-term assets 2,547,040 1,282,959 
Total assets $2,797,695 $1,410,742 
Liabilities and equity 
Accounts payable $78,638 $57,051 
Accrued liabilities 79,721 48,912 
Accrued interest 15,613 2,704 
Deferred revenue and customer deposits 67,727 45,182 
Current portion of long-term debt 1,915 1,881 
Total current liabilities 243,614 155,730 
Long-term debt 1,651,579 624,865 
Deferred tax liabilities 146,086 120,865 
Deferred revenue and customer deposits 6,673 5,377 
Other non-current liabilities 19,034 19,355 
Long-term liabilities 1,823,372 770,462 
Total liabilities 2,066,986 926,192 
Commitments and contingencies (see Note 13) 
Class A common stock: $0.0001 par, 400,000,000 shares authorized at September 30, 2018 and December 31, 2017; 100,303,003 and 84,644,744 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively 10 8 
Class B common stock: $0.0001 par, 100,000,000 shares authorized at September 30, 2018 and December 31, 2017; 8,024,419 shares issued and outstanding at both September 30, 2018 and December 31, 2017 1 1 
Additional paid-in-capital 2,390,188 2,121,926 
Accumulated other comprehensive loss (52,119)(49,497)
Accumulated deficit (1,673,749)(1,636,819)
Total shareholders' equity 664,331 435,619 
Non-controlling interest 66,378 48,931 
Total equity 730,709 484,550 
Total liabilities and equity $2,797,695 $1,410,742 
See the accompanying notes towhich are an integral part of these condensed consolidated financial statements.


DOUBLE EAGLE ACQUISITION CORP.

CONDENSED STATEMENTS OF OPERATIONS

(unaudited)

  Three
Months
Ended
September
30, 2017		  Three
Months
Ended
September
30, 2016		  Nine Months
Ended
September
30, 2017		  Nine Months
Ended
September
30, 2016		 
Revenue $—  $—  $—  $— 
General and administrative expenses  1,027,322   137,376   2,230,228   542,401 
Loss from operations  (1,027,322)  (137,376)  (2,230,228)  (542,401)
Interest on Trust Account  1,143,643   328,313   2,465,810   827,797 
Net income attributable to ordinary shares $116,321  $190,937  $235,582  $285,396 
                 
Weighted average ordinary shares outstanding                
Basic  14,579,697   14,848,938   14,717,452   14,851,863 
Diluted  62,204,329   62,500,000   62,204,329   62,500,000 
                 
Net income per ordinary share                
Basic $0.01  $0.01  $0.02  $0.02 
Diluted $0.00  $0.00  $0.00  $0.00 

3


WillScot Corporation
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended September 30, Nine Months Ended September 30, 
(in thousands, except share data)2018201720182017
Revenues: 
Leasing and services revenue: 
Modular leasing $141,660 $75,320 $340,171 $217,261 
Modular delivery and installation 46,777 24,627 104,440 66,580 
Sales: 
New units 20,920 9,609 33,584 24,491 
Rental units 9,567 6,606 15,813 17,228 
Total revenues 218,924 116,162 494,008 325,560 
Costs: 
Costs of leasing and services: 
Modular leasing 39,215 21,252 93,506 61,694 
Modular delivery and installation 42,390 23,932 98,038 64,404 
Costs of sales: 
New units 15,089 6,916 23,780 17,402 
Rental units 5,750 3,784 9,328 10,067 
Depreciation of rental equipment 35,534 19,009 82,849 53,203 
Gross profit 80,946 41,269 186,507 118,790 
Expenses: 
Selling, general and administrative 71,897 36,097 164,845 100,510 
Other depreciation and amortization 3,720 1,905 7,726 5,736 
Restructuring costs 6,137 1,156 7,214 2,124 
Currency (gains) losses, net (425)(4,270)1,171 (12,769)
Other (income) expense, net (594)1,001 (5,013)1,592 
Operating income 211 5,380 10,564 21,597 
Interest expense 43,447 30,106 67,321 84,674 
Interest income — (3,659)— (9,752)
Loss from continuing operations before income tax (43,236)(21,067)(56,757)(53,325)
Income tax benefit (6,507)(7,632)(13,572)(17,770)
Loss from continuing operations (36,729)(13,435)(43,185)(35,555)
Income from discontinued operations, net of tax — 5,078 — 11,123 
Net loss (36,729)(8,357)(43,185)(24,432)
Net loss attributable to non-controlling interest, net of tax (3,210)— (3,715)— 
Total loss attributable to WillScot $(33,519)$(8,357)$(39,470)$(24,432)
Net loss per share attributable to WillScot – basic and diluted 
Continuing operations $(0.37)$(0.92)$(0.48)$(2.44)
Discontinued operations $— $0.35 $— $0.76 
Net loss per share $(0.37)$(0.57)$(0.48)$(1.68)
Weighted average shares: 
Basic and diluted 90,726,920 14,545,833 82,165,909 14,545,833 
Cash dividends declared per share $— $— $— $— 
See the accompanying notes towhich are an integral part of these condensed consolidated financial statements.


DOUBLE EAGLE ACQUISITION CORP.
CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

For

4


WillScot Corporation
Condensed Consolidated Statements of Comprehensive Loss
(Unaudited)
Three Months Ended September 30, Nine Months Ended September 30, 
(in thousands)2018201720182017
Net loss $(36,729)$(8,357)$(43,185)$(24,432)
Other comprehensive income (loss): 
Foreign currency translation adjustment, net of income tax expense (benefit) of $80, $698, $(161) and $1,316 for the three and nine months ended September 30, 2018 and 2017, respectively 2,298 3,131 

(82)8,914 
Comprehensive loss (34,431)(5,226)(43,267)(15,518)
Comprehensive loss attributable to non-controlling interest (2,967)— 

(3,741)— 
Total comprehensive loss attributable to WillScot $(31,464)$(5,226)$(39,526)$(15,518)
See the nine months ended September 30, 2017

(unaudited)

        Additional     Total 
  Ordinary shares Class A  Ordinary shares Class B  Paid-in  Retained  Shareholders’ 
  Shares  Amount  Shares  Amount  Capital  Earnings  Equity 
                      
Balance as of December 31, 2016  2,297,326  $230   12,500,000  $1,250  $4,456,671  $541,852  $5,000,003 
Adjustment to ordinary shares subject to redemption(1)  (21,412)  (2)   —   —   (235,574)   —   (235,576) 
Net income  —   —   —   —   —   235,582   235,582 
Balance as of September 30, 2017  2,275,914  $228   12,500,000  $1,250  $4,221,097  $777,434  $5,000,009 

See accompanying notes towhich are an integral part of these condensed consolidated financial statements.


5

(1) Includes


WillScot Corporation
Condensed Consolidated Statements of Changes in Equity
(Unaudited)
Class A Common Stock Class B Common Stock 
Shares Amount Shares Amount Additional Paid in Capital Accumulated Other Comprehensive Income Accumulated Deficit Total Shareholders' Equity Non Controlling Interest Total Equity 
Balance at December 31, 201784,645 $8 8,024 $1 $2,121,926 $(49,497)$(1,636,819)$435,619 $48,931 $484,550 
Net loss— — — — — — (39,470)(39,470)(3,715)(43,185)
Other comprehensive loss— — — — — (82)— (82)(26)(108)
Adoption of ASU 2018-02— — — — — (2,540)2,540 — — — 
Stock-based compensation— — — — 2,225 — — 2,225 — 2,225 
Issuance of common stock and contribution of proceeds to WSII9,200 1 — — 131,544 — — 131,545 7,574 139,119 
Acquisition of ModSpace and the effect of the related financing transactions 6,458 1 — — 134,493 — — 134,494 13,614 148,108 
Balance at September 30, 2018100,303 $10 8,024 $1 $2,390,188 $(52,119)$(1,673,749)$664,331 $66,378 $730,709 


6


WillScot Corporation
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Nine Months Ended September 30, 
(in thousands)20182017
Operating Activities: 
Net loss$(43,185)$(24,432)
Adjustments for non-cash items: 
Depreciation and amortization 91,587 80,897 
Provision for doubtful accounts 5,436 3,381 
Gain on sale of rental equipment and other property, plant and equipment (11,194)(7,700)
Interest receivable capitalized into notes due from affiliates — (3,915)
Amortization of debt discounts and debt issuance costs 4,801 11,213 
Share based compensation expense 2,225 — 
Deferred income tax benefit (14,340)(7,683)
Unrealized currency losses (gains) 773 (12,682)
Changes in operating assets and liabilities, net of effect of businesses acquired: 
Trade receivables (26,229)(19,228)
Inventories (553)748 
Prepaid and other assets 173 (8,809)
Accrued interest receivable — (6,994)
Accrued interest payable 12,902 15,079 
Accounts payable and other accrued liabilities (11,969)28,243 
Deferred revenue and customer deposits 5,153 (1,217)
Net cash provided by operating activities 15,580 46,901 
Investing Activities: 
Acquisition of a business - ModSpace(1,060,140)— 
Acquisition of a business - Tyson (24,006)— 
Proceeds from sale of rental equipment 21,593 18,750 
Purchase of rental equipment and refurbishments (111,505)(82,276)
Lending on notes due from affiliates — (69,939)
Repayments on notes due from affiliates — 2,151 
Proceeds from the sale of property, plant and equipment 681 17 
Purchase of property, plant and equipment (3,091)(2,938)
Net cash used in investing activities (1,176,468)(134,235)
Financing Activities: 
Receipts from issuance of common stock 147,200 — 
Receipts from borrowings 1,184,601 348,609 
Receipts on borrowings from notes due to affiliates — 75,000 
Payment of financing costs (34,770)(10,648)
Repayment of borrowings (135,537)(319,678)
Principal payments on capital lease obligations (88)(1,606)
Net cash provided by financing activities 1,161,406 91,677 
Effect of exchange rate changes on cash and cash equivalents 68 311 
Net change in cash and cash equivalents 586 4,654 
Cash and cash equivalents at the beginning of the period 9,185 6,162 
Cash and cash equivalents at the end of the period $9,771 $10,816 
Supplemental Cash Flow Information: 
Interest paid $28,721 $60,212 
Income taxes paid, net of refunds received $2,339 $(400)
Capital expenditures accrued or payable $17,478 $11,773 
See the effectaccompanying notes which are an integral part of these condensed consolidated financial statements.
7


WillScot Corporation
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
NOTE 1 - Summary of Significant Accounting Policies
Organization and Nature of Operations
WillScot Corporation (“WillScot” and, together with its subsidiaries, the “Company”), is a leading provider of modular space and portable storage solutions in the United States (“US”), Canada and Mexico. The Company leases, sells, delivers and installs mobile offices, modular buildings and storage products through an integrated network of branch locations that spans North America.
WillScot, whose Class A common shares are listed on the Nasdaq Capital Market (Nasdaq: WSC), serves as the holding company for the Williams Scotsman family of companies. All of the redemptionCompany’s assets and operations are owned through Williams Scotsman Holdings Corp. (“WS Holdings”). WillScot operates and owns 91.0% of shares on September 15, 2017, on which date, shareholders holding 295,671 public shares exercised their right to convert such public shares into a pro rata portionWS Holdings, and Sapphire Holding S.à r.l. (“Sapphire”), an affiliate of TDR Capital LLP (“TDR Capital”), owns the Trust Account (see Note 1)remaining 9.0%.


DOUBLE EAGLE ACQUISITION CORP.
CONDENSED STATEMENTS OF CASH FLOWS

(unaudited)

  Nine Months
Ended
September 30,
2017		  Nine Months
Ended
September 30,
2016		 
Cash flows from operating activities:        
Net income attributable to ordinary shares $235,582  $285,396 
Changes in operating assets and liabilities:        
Increase (decrease) in prepaid expenses  47,709   (99,242)
Increase (decrease) in accounts payable  1,627,782   (20,789)
Net cash provided by operating activities  1,911,073   165,365 
         
Cash flows from investing activities:        
Trust income reinvested in Trust account  (2,465,810)  (827,797)
Withdrawal from Trust Account upon redemptions  2,978,166   — 
Net cash provided by (used in) investing activities  512,356   (827,797)
         
Cash flows from financing activities:        
Advances from Sponsor  380,000   — 
Redemption of ordinary shares  (2,978,166)  — 
Net cash provided by financing activities  (2,598,166)  — 
         
Decrease in cash during period  (174,737)  (662,432)
Cash at beginning of period  188,063   1,007,861 
Cash at end of period $13,326  $345,429 

See accompanying notes to condensed financial statements.


DOUBLE EAGLE ACQUISITION CORP.

Notes to Condensed Financial Statements

1.Organization and Business Operations

Incorporation

Double Eagle Acquisition Corp. (the “Company”)WillScot was incorporated as a Cayman Islands exemptedexempt company under the name, Double Eagle Acquisition Corporation ("Double Eagle"), on June 26, 2015. The functional currency of the Company is the United States dollar.

Sponsor

The Company’s sponsor isPrior to November 29, 2017, Double Eagle Acquisition LLC,was a Delaware limited liabilityNasdaq-listed special purpose acquisition company (the “Sponsor”).

Fiscal Year End

The Company's fiscal year end is December 31.

Business Purpose

The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or other similar business combination with one or more operating businesses.

combination. On August 21,November 29, 2017, the Company entered into a Stock Purchase Agreement, as amended on September 6, 2017 and November 6, 2017 and as may be further amended (the “Stock Purchase Agreement”), by and among the Company,Double Eagle indirectly acquired Williams Scotsman Holdings Corp, a wholly owned subsidiary of the CompanyInternational, Inc. (“Holdco Acquiror”, and, together with the Company, the “Acquirors”WSII”), Algeco Scotsman Global S.à r.l. and Algeco Scotsman Holdings Kft. (together with from Algeco Scotsman Global S.à r.l., (together with its subsidiaries, the “Sellers”“Algeco Group”). Pursuant, which is majority owned by an investment fund managed by TDR Capital. As part of the transaction (the “Business Combination”), Double Eagle domesticated to Delaware and changed its name to WillScot Corporation. Additional information about the Business Combination and the Company's operations prior thereto is contained in the consolidated financial statements and notes included in WillScot's Annual Report on Form 10-K for the year ended December 31, 2017.

Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all the information and notes required by accounting principles generally accepted in the US (“GAAP”) for complete financial statements. The accompanying unaudited condensed consolidated financial statements contain all adjustments, which are of a normal and recurring nature, necessary to present fairly the financial position and the results of operations for the interim periods presented.
The results of consolidated operations for the three and nine months ended September 30, 2018 are not necessarily indicative of the results to be expected for the full year. For further information, refer to the Stock Purchase Agreement,consolidated financial statements and notes included in WillScot's Annual Report on Form 10-K for the year ended December 31, 2017.
Principles of Consolidation
The condensed consolidated financial statements comprise the financial statements of WillScot and its subsidiaries that it controls due to ownership of a majority voting interest. Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Company will re-domesticateobtains control, and continue to be consolidated until the date when such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the Company. All intercompany balances and transactions are eliminated. The Business Combination was accounted for as a Delaware corporationreverse recapitalization in accordance with Accounting Standard Codification (“ASC”) 805, Business Combinations. Although WillScot was the indirect acquirer of WSII for legal purposes, WSII was considered the acquirer for accounting and financial reporting purposes.
As a result of WSII being the Holdco Acquiror will purchase from Sellers all ofaccounting acquirer, the issued and outstanding shares of common stock, par value $0.01 per share, of Williams Scotsman International, Inc. (“Williams Scotsman”), resulting in Williams Scotsman becoming a wholly owned subsidiary offinancial reports filed with the Company (the transactions contemplated by the Stock Purchase Agreement, the “Business Combination”).

Financing

The registration statement for the Company’s initial public offering (the “Public Offering”) (as described in Note 3) was declared effective by the United StatesUS Securities and Exchange Commission (the “SEC”) on September 10, 2015.by the Company subsequent to the Business Combination are prepared “as if” WSII is the predecessor and legal successor to the Company. The Company consummated the Public Offering on September 16, 2015, and, simultaneously with the closinghistorical operations of WSII are deemed to be those of the Public Offering,Company. Thus, the Sponsor, Harry E. Sloan and the Company’s independent directors (and/or one or more of their estate planning vehicles) purchased an aggregate of 19,500,000 warrantsfinancial statements included in a private placement at a price of $0.50 per warrant, generating gross proceeds, before expenses, of $9,750,000 (Note 4).

Upon the closing of the Public Offering and the private placement, $500,000,000 was placed in a trust account with Continental Stock Transfer & Trust Company acting as trustee (the “Trust Account”) (discussed below). The closing of the Public Offering included an initial partial exercise (2,000,000 units) of the overallotment option granted to the underwriters.

Trust Account

The Trust Account can be invested in permitted United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), having a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act that invest only in direct U.S. government treasury obligations.


On September 15, 2017, the Company held an extraordinary general meeting whereby its shareholders approved an amendment to the Company’s amended and restated memorandum and articles of association to extend the date by which the Company must consummate a Business Combination from September 16, 2017 to December 31, 2017 (the “Extension Amendment”). The number of ordinary shares redeemed in connection with the Extension Amendment was 295,671. The Company distributed $2,978,166, or approximately, $10.05 per share, to redeeming shareholders. After giving effect to such redemptions, the balance in the Company’s Trust Account was $500,828,554.

The Company’s amended and restated memorandum and articles of association provide that, other than the withdrawal of interest to pay income taxes, if any, none of the funds held in trust will be released until the earlier of:this report reflect (i) the completionhistorical operating results of WSII prior to the Business Combination; (ii) the redemptioncombined results of anyWillScot and WSII following the Business Combination on November 29, 2017; (iii) the assets and liabilities of WSII at their historical cost; and (iv) WillScot's equity structure for all periods presented. The recapitalization of the Class A ordinarynumber of shares included inof common stock attributable to the Units sold in the Public Offering properly tenderedpurchase of WSII in connection with a shareholder vote to amend the Company’s amended and restated memorandum and articles of association to modify the substance or timing of the Company’s obligation to redeem 100% of the Class A ordinary shares included in the Units sold in the Public Offering if the Company does not complete the Business Combination by December 31, 2017is reflected retroactively to the earliest period presented and is utilized for calculating earnings per share in all prior periods presented. No step-up basis of intangible assets or (iii)goodwill was recorded in the redemption of 100%Business Combination transaction consistent with the treatment of the Class A ordinary shares included intransaction as a reverse capitalization of WSII. WSII’s remote accommodations business, which consisted of Target Logistics Management LLC (“Target Logistics”) and its subsidiaries and Chard Camp Catering Services (“Chard,” and together with Target Logistics, the Units sold in the Public Offering if the Company is unable“Remote Accommodations Business”), was transferred to complete a Business Combination by December 31, 2017.

Business Combination

The Business Combination is subject to the following size, focus and shareholder approval provisions:

Size/Control —The Business Combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80%members of the assets heldAlgeco Group on November 28, 2017 in the Trust Account (excluding the deferred underwriting commissionsa transaction under common control and taxes payable on the income earned on the Trust Account) at the timewas not included as part of the agreement to enter into the Business Combination. The operating results of the Remote Accommodations Business, net of tax, for the three and nine

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months ended September 30, 2017 have been reported as discontinued operations in the condensed consolidated financial statements.
Recently Issued and Adopted Accounting Standards
The Company will not complete a Business Combination unless it acquires a controlling interest in a target company or is otherwise not required to registerqualifies as an investmentemerging growth company (“EGC”) as defined under the Investment Company Act.

Focus — The Company’s efforts in identifying prospective target businesses initially focused on businesses inJumpstart Our Business Startups Act (the “JOBS Act”). Using exemptions provided under the media or entertainment industries, including providers of content, but the Company also pursued acquisition opportunities in other sectors.

Tender Offer/Shareholder Approval — In connection with the Stock Purchase Agreement, the Company will seek shareholder approval of the Business Combination at a meeting scheduled for November 16, 2017, at which shareholders may seekJOBS Act provided to redeem their Class A ordinary shares, regardless of whether they vote for or against the Business Combination, for cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account calculated as of two business days prior to the consummation of the Business Combination, including interest but less income taxes payable. The Company will complete the Business Combination only if a majority of the outstanding ordinary shares voted are voted in favor of the Business Combination. However, in no event will the Company redeem its public shares in an amount that would cause its net tangible assets to be less than $5,000,001.

As a result of the redemption right attached to the Company’s Class A ordinary shares, such Class A ordinary shares have been recorded at redemption amount and classified as temporary equity, in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, “Distinguishing Liabilities from Equity.”


Liquidation and Going Concern

In connection with the Extension Amendment approved by the Company’s shareholders on September 15, 2017,EGCs, the Company has until December 31, 2017elected to complete the Business Combination. If the Company does not complete the Business Combination within this period of time, it shall (i) cease all operations except for the purposes of winding up; (ii) as promptly as reasonably possible, but not more than ten business days thereafter, redeem the public shares for a per share pro rata portion of the Trust Account, including interest, but less income taxes payable (less up to $100,000 of such net interest to pay dissolution expenses) and (iii) as promptly as possible following such redemption, dissolve and liquidate the balance of the Company’s net assets to its remaining shareholders, as part of its plan of dissolution and liquidation. The Sponsor, Harry E. Sloan and the Company’s executive officers and independent directors (the “initial shareholders”) have entered into letter agreements with the Company, pursuant to which they have waived their rights to participate in any redemption with respect to their Founder Shares (as defined below); however, if the initial shareholders or any of the Company’s officers, directors or affiliates acquire Class A ordinary shares in or after the Public Offering, they will be entitled to a pro rata share of the Trust Account upon the Company’s redemption or liquidation in the event the Company does not complete the Business Combination within the required time period. In the event of such distribution, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be less than the initial public offering price per Unit in the Public Offering.

This mandatory liquidation and subsequent dissolution raises substantial doubt about the Company's ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after December 31, 2017.

As of September 30, 2017, the Company had $13,326 in cash and a working capital deficit of $2,044,395. It is anticipated that the Company may incur loans from the Sponsor, as permitted in the Initial Public Offering, for additional working capital for Company’s ordinary operations and in pursuit of a business combination. In the event of liquidation, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be less than the initial public offering price per unit in the Public Offering.

Emerging Growth Company

Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to complydefer compliance with new or revised financial accounting standards until private companies (thata company that is those that have not had a Securitiesan issuer (as defined under section 2(a) of the Sarbanes-Oxley Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are2002) is required to comply with such standards. As such, compliance dates included below pertain to non-issuers, and as permitted, early adoption dates for non-issuers are indicated.

Subject to limited exception, WillScot will cease to be EGC on the earlier (i) the last day of the fiscal year in which WillScot’s annual gross revenues exceed $1.07 billion, (ii) the date on which the Company issues more than $1.0 billion in nonconvertible debt securities during the preceding three-year period, and (iii) the date on which WillScot is deemed to be a large accelerated filer under the SEC’s rules. Based on the recent ModSpace (defined below) acquisition described in Note 2, WillScot anticipates that its 2019 annual gross revenues will exceed $1.07 billion. WillScot also anticipates that, due in part to the amount of Class A common stock issued by WillScot to fund the ModSpace acquisition, WillScot will be deemed to be a large accelerated filer at December 31, 2019 based on the value of its Class A common stock held by non-affiliates at June 30, 2019. WillScot currently foresees remaining an EGC until December 31, 2019, but would lose EGC eligibility immediately if it were to issue additional debt and exceed the debt issuance criteria described above.
Recently Issued Accounting Standards
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenuefrom Contracts with Customers (Topic 606), which prescribes a single comprehensive model for entities to use in the accounting for revenue arising from contracts with customers. The new guidance will supersede virtually all existing revenue guidance under GAAP and is effective for annual reporting periods beginning after December 15, 2018. Early adoption for non-public entities is permitted starting with annual reporting periods beginning after December 15, 2016. The core principle contemplated by this new standard was that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount reflecting the consideration to which the entity expects to be entitled in exchange for those goods or services. New disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers are also required. In April and May 2016, the FASB also issued clarifying updates to the new or revised financial accounting standards. The JOBS Act provides that a company can electstandard specifically to opt outaddress certain core principles including the identification of performance obligations, licensing guidance, the assessment of the extendedcollectability criterion, the presentation of taxes collected from customers, non-cash considerations, contract modifications and completed contracts at transition.
The Company is currently finalizing its evaluation of the impact that the updated guidance will have on the Company’s financial statements and related disclosures. As part of the evaluation process, the Company continues to hold regular meetings with key stakeholders from across the organization to discuss the impact of the standard on its existing contracts. The Company plans to adopt Topic 606 using the modified retrospective transition periodapproach.
The Company is utilizing a bottom-up approach to analyze the impact of the standard on its portfolio of contracts by reviewing the Company’s current accounting policies and comply withpractices to identify potential differences that would result from applying the requirements that applyof the new standard to non-emerging growth companies but any such electionthe Company’s existing revenue contracts.

As part of its implementation project, the Company has prepared analyses with respect to opt out is irrevocable.revenue stream scoping, performed contract reviews of a representative sample of customer arrangements, developed a gap analysis and evaluated the revised disclosure requirements. The two primary lines of business impacted by the adoption are new and used sales transactions and modular leasing services transactions. The Company has electedsubstantially completed its procedures based on the new and used sales and modular leasing service transactions that occurred through the second quarter of 2018 and is not aware of any significant changes based on the work performed to opt outdate. The Company has incorporated the recently acquired Modular Space Holdings, Inc. (“ModSpace”) into the project during the third quarter of 2018. As described in Note 2, ModSpace was acquired in August 2018 and the Company has commenced workshops with key stakeholders, detailed contract reviews and a financial statement disclosure gap evaluation specific to revenue streams acquired through the acquisition.
After finalizing its procedures during the fourth quarter of 2018, the Company will conclude on the level of impact that the adoption of ASC 606 will have on the consolidated financial statements, including financial statement disclosures. Specific to disclosures, the Company expects to provide additional detail regarding the disaggregation of revenue and contract balances. The Company is required to adopt the standard as of January 1, 2019 and plans to first present financial statements that reflect the adoption in the first quarter of 2019.
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This guidance revises existing practice related to accounting for leases under ASC Topic 840, Leases (“ASC 840”) for both lessees and lessors. The new guidance requires lessees to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). The lease liability will be equal to the present value of lease payments and the right-of-use asset will be based on the lease liability, subject to adjustment such extended transition period which means that when anas for initial direct costs. For income statement purposes,
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the new standard retains a dual model similar to ASC 840, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line expense (similar to current accounting by lessees for operating leases under ASC 840) while finance leases will result in a front-loaded expense pattern (similar to current accounting by lessees for capital leases under ASC 840). While the new standard maintains similar accounting for lessors as under ASC 840, the new standard reflects updates to, among other things, align with certain changes to the lessee model. 
The new standard is issued or revisedeffective for non-public entities for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted for all entities. However, based on WillScot's expectation that it has different application dates for public or private companies,will cease to be an EGC as of December 31, 2019, the Company as an emerging growth company, canplans to adopt the new or revised accounting standard atin the time private companies adoptfourth quarter of 2019. Adoption of the new or revised standard.

2.Significant Accounting Policies

Basisstandard could be required earlier in 2019 if WillScot loses EGC eligibility earlier than anticipated based on other criteria.

The guidance includes a number of Presentation

practical expedients that the Company is evaluating and may elect to apply. The accompanying condensed financial statementsadoption of the new standard will require the Company are presented in U.S. dollars in conformity with accounting principles generally accepted into recognize right-of-use assets and lease liabilities that will be significant to our consolidated balance sheet. The Company will continue to evaluate the United Statesimpacts of America and pursuant to the rules and regulations of the SEC, and reflect all adjustments, consisting only of normal recurring adjustments, which are, in the opinion of management, necessary for the fair presentation of thethis guidance on its financial position, as of September 30, 2017 and the results of operations, and cash flowsflows. The Company plans to update its systems, processes and internal controls to meet the new reporting and disclosure requirements.

Recently Adopted Accounting Standards
From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date.
During December 2017, shortly after the Tax Cuts and Jobs Act (the “Tax Act”) was enacted, the SEC issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”) which provides guidance on accounting for the periods presented. Certain informationTax Act’s impact. SAB 118 provides a measurement period, which in no case should extend beyond one year from the Tax Act enactment date, during which a company acting in good faith may complete the accounting for the impacts of the Tax Act under ASC Topic 740. Per SAB 118, companies must reflect the income tax effects of the Tax Act in the reporting period in which the accounting under ASC Topic 740 is complete. To the extent the accounting for certain income tax effects of the Tax Act is incomplete, companies can determine a reasonable estimate for those effects and disclosure normallyrecord a provisional estimate in the financial statements in the first reporting period in which a reasonable estimate can be determined. If a company cannot determine a provisional estimate to be included in the financial statements, preparedit should continue to apply ASC 740 based on the provisions of the tax laws that were in effect immediately prior to the Tax Act being enacted. If a company is unable to provide a reasonable estimate of the impacts of the Tax Act in a reporting period, a provisional amount must be recorded in the first reporting period in which a reasonable estimate can be determined. As a result of the Tax Act, in 2017, the Company remeasured its net deferred tax liabilities and recognized a provisional net benefit of $28.1 million. In addition, based on information currently available, the Company recorded a provisional income tax expense of $2.4 million in 2017 related to the deemed repatriation of foreign earnings. The Company recorded a minor adjustment in 2018 to the provisional amounts recorded in its financial statements for the year ended December 31, 2017 (see Note 9) and continues to evaluate the provisions of the Tax Act including guidance from the Department of Treasury and Internal Revenue Service. Additionally, the Company filed its US tax return for 2017 during the fourth quarter of 2018 and any changes to the estimates used to the final tax positions for temporary differences, earnings and profits will result in adjustments of the remeasurement amounts for the Tax Act recorded as of December 31, 2017.
The Company continues to evaluate the impact of the Global Low Taxed Intangible Income (“GILTI”) provision of the Tax Act. The Company is required to make an accounting policy election of either (1) treating GILTI as a current period expense when incurred or (2) factoring such amounts into the Company’s measurement of its deferred taxes. The Company has not completed its analysis and has not made a determination of its accounting policy for GILTI.

NOTE 2 - Acquisitions
Tyson Acquisition
On January 3, 2018, the Company acquired all of the issued and outstanding membership interests of Onsite Space LLC (d/b/a Tyson Onsite (“Tyson”)). Tyson provided modular space rental services in the Midwest, primarily in Indiana, Illinois and Missouri. The acquisition date fair value of the consideration transferred consisted of $24.0 million in cash consideration, net of cash acquired. The transaction was funded by borrowings under the ABL Facility (defined in Note 7).
Through September 30, 2018, the Company has recorded adjustments to the Tyson opening balance sheet, which increased rental equipment and accrued liabilities by $0.9 million and $0.1 million, respectively and decreased property, plant and equipment by $0.1 million. The offset of these adjustments was recorded to goodwill as detailed in Note 6. Increases or decreases in the estimated fair values of the net assets acquired may impact the Company’s statements of operations in future periods. The Company expects that the preliminary values assigned to the rental fleet, property, plant and equipment, intangible assets, deferred tax assets and other accrued tax liabilities will be finalized during the fourth quarter of 2018. 
Tyson results were immaterial to the condensed consolidated statements of operations for the three and nine months ended September 30, 2018 and as a result, the Company is not presenting pro-forma information. 
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Acton Acquisition
On December 20, 2017, the Company acquired 100% of the issued and outstanding ownership interests of Acton Mobile Holdings LLC (“Acton”) for a cash purchase price of $237.1 million, subject to certain adjustments. Acton owns all of the issued and outstanding membership interests of New Acton Mobile Industries, which provides modular space and portable storage rental services across the US. The acquisition was funded by cash on hand and borrowings under the ABL Facility.
Through September 30, 2018, the Company recorded adjustments to the Acton opening balance sheet, which increased accrued liabilities, deferred revenue, deferred tax assets and receivables by $0.8 million, $0.6 million, $0.8 million, and $2.4 million, respectively, and decreased rental equipment by $2.1 million. The offset of these adjustments was recorded to goodwill as detailed in Note 6. As a result of the timing of the transaction, the purchase price allocation for the rental equipment, intangible assets, property, plant and equipment, deferred tax assets, receivables, and other accrued liabilities acquired and assumed are based on preliminary valuations and are subject to change as the Company obtains additional information during the acquisition measurement period. Increases or decreases in the estimated fair values of the net assets acquired may impact the Company’s statements of operations in future periods. The Company expects that the preliminary values assigned to the rental equipment, intangible assets, property, plant and equipment, deferred tax assets, non-indemnified liabilities, and other accrued tax liabilities will be finalized during the fourth quarter of 2018.
Pro-forma results are presented in aggregate with the ModSpace acquisition below.
ModSpace Acquisition
On August 15, 2018 (the "Closing Date"), the Company acquired ModSpace, a privately-owned provider of office trailers, portable storage units and modular buildings. The acquisition was consummated by merging a special purpose subsidiary of the Company with and into ModSpace, with ModSpace surviving the merger as a subsidiary of WSII. The Company acquired ModSpace to create long-term shareholder value driven by, among other things, economies of scale, cost synergies and revenue opportunities unique to a combination of WillScot's and ModSpace's operations, and other benefits associated with being an industry-leading specialty rental services provider.
The aggregate purchase price for ModSpace was $1.2 billion and consisted of (i) $1.1 billion in cash, (ii) 6,458,229 shares of WillScot's Class A common stock (the "Stock Consideration") with a fair market value of $95.8 million and (iii) warrants to purchase an aggregate of 10,000,000 shares of WillScot’s Class A common stock at an exercise price of $15.50 per share (the "ModSpace Warrants") with a fair market value of $52.3 million, and (iv) a working capital adjustment of $5.7 million. Of the cash consideration, $3.0 million was deposited into an escrow account to fund any post-closing adjustments from differences between the estimated working capital and the actual working capital of ModSpace at closing. The final working capital of ModSpace at closing is still being evaluated by the Company and the sellers' representative in accordance with GAAP havethe terms of the purchase agreement. The acquisition was funded by the net proceeds of WillScot's issuance of 9,200,000 shares of Class A common stock (see Note 8), the net proceeds of WSII’s issuance of $300.0 million in senior secured notes and $200.0 million in senior unsecured notes (see Note 7), and borrowings under the ABL Facility (see Note 7).
The purchase price has been omitted pursuantdetermined to such rulesbe as follows:
Purchase Price 
(in thousands, except for per share amounts) Price 
Cash $1,054,416 
Stock consideration (a) 95,796 
ModSpace warrants (b) 52,310 
Working capital adjustment (c) 5,724 
Total purchase price $1,208,246 
(a) The fair market value of the 6,458,229 shares issued as consideration was determined using the closing price on August 15, 2018, of $15.78 per share less a discount of 6.0%, based on a lock up agreement executed in connection with the acquisition of ModSpace.
(b) Warrants were valued assuming a fair market value of $5.23 as estimated using a Black-Scholes valuation model as of August 15, 2018. 
(c) The estimated working capital adjustment as of the Closing Date was $5.7 million. The working capital amount is subject to post-close adjustments.

The acquisition date fair value of the stock consideration was estimated using a Black-Scholes valuation model. The estimated fair value of the shares are a level 3 fair value measurement. The fair value of each share is estimated using the Black-Scholes option pricing model with the following assumptions: expected dividend yield, expected stock price volatility, weighted-average risk-free interest rate and regulations. Interim resultsaverage expected term of the lock up period on the shares. The volatility assumption used in the Black-Scholes option-pricing model is derived from the historical daily change in the market price of the Company's common stock, as well as the historical daily changes in the market price of its peer group, based on weighting, as determined by the Company. The risk-free interest rate used in the Black-Scholes model is based on the implied US
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Treasury bill yield curve at the date of grant with a remaining term equal to the Company’s expected term assumption. The Company has never declared or paid a cash dividend on common shares.
Expected Volatility 28.6 %
Risk-free rate of interest 2.2 %
Dividend Yield — %
Expected life (years) 0.5 

The acquisition date fair value of the warrants was estimated using a Black-Scholes valuation model. The estimated fair value of the warrants is a level 3 fair value measurement. The fair value of each warrant is estimated using the Black-Scholes option-pricing model with the following assumptions: expected dividend yield, expected stock price volatility, weighted-average risk-free interest rate and weighted-average expected term of the warrants. The volatility assumption used in the Black-Scholes option-pricing model is derived from the historical daily change in the market price of the Company's common stock, as well as the historical daily changes in the market price of its peer group, based on weighting, as determined by the Company. The risk-free interest rate used in the Black-Scholes model is based on the implied US Treasury bill yield curve at the date of grant with a remaining term equal to the Company’s expected term assumption. The Company has never declared or paid a cash dividend on common shares.
Expected Volatility 35.0 %
Risk-free rate of interest 2.7 %
Dividend Yield — %
Expected life (years) 4.3 

The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed as of the acquisition date, August 15, 2018. The Company’s estimated fair value of ModSpace’s assets acquired and liabilities assumed on the acquisition date are determined based on preliminary valuations and analyses. Accordingly, the Company has made provisional estimates for the assets acquired and liabilities assumed. The valuation of intangible assets acquired is based on certain valuation assumptions yet to be finalized, including cash flow projections, discount rates, contributory asset charges and other valuation model inputs. The valuation of tangible long-lived assets acquired is dependent upon, among other things, refinement of the inputs in the valuation model and an analysis of the condition and estimated remaining useful lives of the assets acquired. In addition to finalizing the valuation of acquired assets, the Company is analyzing complex provisions of tax law regarding treatment of tax attributes upon ModSpace's March 2017 emergence from bankruptcy, implications of the Tax Act as well as scheduling the reversal of deferred tax balances thereof. The Company expects its analysis to be substantially complete by the close of the fourth quarter. Due to the provisional nature of the aforementioned items, the Company has not changed its judgment about the realizability of its pre-existing deferred tax assets as a result of the business combination. The provisional amounts reflected are subject to further adjustment, which may affect the fair values ascribed to goodwill, acquired intangible and tangible assets and the related deferred tax balances. Substantial completion of the requisite analyses may result in changes to acquired deferred tax liabilities which thereby may also affect the Company’s judgment about the realizability of its pre-existing deferred tax assets for which any reductions in the valuation allowance will be reflected separate from the business combination as discrete adjustments to income tax expense (benefit) in the period in which it is determined.

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Purchase Price
(in thousands) Value 
Trade receivables, net (a) $81,055 
Inventory 10,483 
Prepaid expenses and other current assets 6,063 
Rental equipment 866,801 
Property, plant and equipment 111,681 
Intangible assets 
Favorable leases (b) 3,850 
Trade name (b) 3,000 
Total identifiable assets acquired $1,082,933 
Accounts payable $30,432 
Accrued liabilities 20,877 
Deferred tax liabilities, net 42,531 
Deferred revenue and customer deposits 16,646 
Total liabilities assumed $110,486 
Total goodwill (c) $235,799 

(a) The fair value of accounts receivable was $81.1 million and the gross contractual amount was $89.7 million. The Company estimated that $8.6 million is uncollectable.
(b) The trade name has an estimated useful life of three years. The favorable lease asset has an estimated useful life of six years. 
(c) The goodwill is reflective of ModSpace’s going concern value and operational synergies that the Company expects to achieve that would not be available to other market participants. The goodwill is not deductible for income tax purposes. The goodwill is allocated to the Modular – US and Modular – Other North America segments in the amounts of $203.3 million and $32.5 million, respectively.

ModSpace has generated $65.5 million of revenue since the acquisition date, which is included in the condensed consolidated financial statements of operations for the three and nine months ended September 30, 2018.
The pro-forma information below has been prepared using the purchase method of accounting, giving effect to the Acton and ModSpace acquisitions as if they had been completed on January 1, 2017. The pro-forma information is not necessarily indicative of the Company’s results of operations had the acquisitions been completed on the above dates, nor is it necessarily indicative of the Company’s future results. The pro-forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisitions, and also does not reflect additional revenue opportunities following the acquisitions.

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The tables below present unaudited pro-forma consolidated statements of operations information as if ModSpace and Acton had been included in the Company’s consolidated results for a full year.

Net Income Per Ordinary Share

Basic net income per ordinary sharethe three and nine months ended September 30, 2018 and 2017:

(in thousands) Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 
WillScot revenues (a) $218,924 $494,008 
ModSpace revenues 81,692 312,609 
Pro-forma revenues $300,616 $806,617 
WillScot pretax loss (a) $(43,236)$(56,757)
ModSpace pretax loss (11,460)(7,456)
Pretax loss before pro-forma adjustments (54,696)(64,213)
Pro-forma adjustments to combined pretax loss: 
Impact of fair value mark-ups/useful life changes on depreciation (b) (132)(395)
Intangible asset amortization (c) (250)(750)
Interest expense (d) (16,495)(49,467)
Elimination of ModSpace interest (e) 4,346 20,279 
Pro-forma pretax loss (f) (67,227)(94,546)
Income tax benefit (10,118)(22,608)
Pro-forma net loss  $(57,109)$(71,938)
(a)Excludes historic revenues and pre-tax income from discontinued operations. Post-acquisition ModSpace revenues and pre-tax income results are reflected in WillScot's historic revenue amounts.
(b)Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups of equipment acquired in the ModSpace acquisition. The useful lives assigned to such equipment is preliminary and did not change significantly from the useful lives used by ModSpace.
(c)Amortization of the trade name acquired in ModSpace acquisition.
(d)In connection with the ModSpace acquisition, the Company drew an incremental $420.0 million on the ABL Facility and issued $300.0 million of secured notes and $200.0 million of unsecured notes. As of September 30, 2018, the weighted-average interest rate for the aforementioned borrowings was 6.54%. Interest expense includes amortization of related deferred financing fees on debt incurred in conjunction with ModSpace acquisition.
(e)Interest on ModSpace historic debt was eliminated.
(f)Pro-forma pretax loss includes $6.1 million and $7.2 million, $7.5 million and $14.9 million, $10.7 million and $14.8 million, of restructuring expense, integration costs, and transactions costs incurred by WillScot for the three and nine months ended September 30, 2018, respectively. Additionally, pro-forma pretax loss for the three and nine month ended September also includes $20.5 million of interest expense associated with bridge financing fees incurred in connection with the acquisition of ModSpace. 
(g)The pro-forma tax rate applied to the ModSpace pretax loss is the same as the William Scotsman effective rate for the period.
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(in thousands)Three Months Ended September 30, 2017 Nine Months Ended
September 30, 2017 
WillScot revenues (a) $116,162 $325,560 
Acton and ModSpace revenues (b) 151,434 407,331 
Pro-forma revenues $267,596 $732,891 
WillScot pretax loss (a) $(21,067)$(53,325)
Acton and ModSpace pretax income (loss) (b) 6,843 (108,295)
Pro-forma pretax loss (14,224)(161,620)
Pro-forma adjustments to combined pretax loss: 
Impact of fair value mark-ups/useful life changes on depreciation (c) (746)(1,959)
Intangible asset amortization (d) (427)(1,281)
Interest expense (e) (19,255)(57,745)
Elimination of Acton and ModSpace interest (f) 8,936 36,702 
Pro-forma pretax loss (25,716)(185,903)
Income tax benefit (g) (9,316)(61,950)
Pro-forma loss from continuing operations (h) (16,400)(123,953)
Income from discontinued operations 5,078 11,123 
Pro-forma net loss $(11,322)$(112,830)

(a)Excludes historic revenues and pre-tax income from discontinued operations. Includes historic corporate and other SG&A expenses related to Algeco Group costs, which were $7.6 million and $15.7 million for the three and nine months ended September 30, 2017, respectively. Post-acquisition ModSpace revenues and pre-tax income results are reflected in WillScot's historic revenue amounts.
(b)Historic Acton revenues were $24.5 million and $71.9 million and historic ModSpace revenues were $126.9 million and $335.4 million, respectively, for the three and nine months ended September 30, 2017. Historic Acton pretax income was $0.9 million and $0.6 million and historic ModSpace pretax income was $5.9 million and pretax loss was $108.9 million, respectively, for the three and nine months ended September 30, 2017.
(c)Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups of equipment acquired in the Acton and ModSpace acquisitions. The useful lives assigned to such equipment did not change significantly from the useful lives used by Acton and ModSpace.
(d)Amortization of the trade names acquired in Acton and ModSpace acquisitions.
(e)In connection with the Acton acquisition, the Company drew $237.1 million on the ABL Facility. As of September 30, 2018, the weighted-average interest rate of ABL borrowings was 4.65%. In connection with the ModSpace acquisition, the Company drew an incremental $420.0 million on the ABL Facility and issued $300.0 million of secured notes and $200.0 million of unsecured notes. The weighted-average interest rate of all ModSpace acquisition borrowings was 6.54%. Interest expense includes amortization of related deferred financing fees on debt incurred in conjunction with ModSpace acquisition.
(f)Interest on Acton and ModSpace historic debt was eliminated. Historic Acton interest was $1.4 million and $3.9 million and historic ModSpace interest was $7.5 million and $32.8 million, respectively, for the three and nine months ended, September 30, 2017.
(g)The pro-forma tax rate applied to the Acton and ModSpace pretax income (loss) are the same as the WillScot effective rate for the period.
(h)Pro-forma pretax loss includes $5.2 million and $6.1 million of Business Combination transactions costs incurred by WillScot for the three and nine months ended September 30, 2017, respectively
Transaction and Integration Costs
The Company incurred $7.5 million and $14.9 million in integration costs associated with the Tyson, Acton, and ModSpace acquisitions within selling, general and administrative expenses ("SG&A") for the three and nine months ended September 30, 2018, respectively. The Company incurred $10.7 million and $14.8 million in transaction costs related to the ModSpace acquisition for the three and nine months ended September 30, 2018, respectively.

NOTE 3 - Discontinued Operations
WSII’s Remote Accommodations Business was transferred to another entity included in the Algeco Group prior to the Business Combination. WSII does not expect to have continuing involvement in the Remote Accommodations Business going forward. Historically, the Remote Accommodations Business leased rental equipment from WSII. After the Business
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Combination, several lease agreements for rental equipment still exist between the Company and Target Logistics. The lease revenue associated with these agreements is computed by dividing net income by the weighted average number of ordinary shares outstandingdisclosed in Note 16. The Company also had rental unit sales to Target Logistics during the period. Diluted net income per sharethird quarter which is computed by dividing net income per share bydisclosed in Note 16.
As a result of the weighted average numbertransactions discussed above, the Remote Accommodations segment has been reported as discontinued operations in the condensed consolidated statements of ordinary shares outstanding (including shares subject to redemption), plus, to the extent dilutive, the incremental number of ordinary shares to settle private placement warrants held by the Sponsor, as calculated using the treasury stock method. An aggregate of 47,428,415 shares of Class A ordinary shares subject to possible redemption at September 30, 2017 have been excluded from the calculation of basic income per ordinary shareoperations for the three and nine months ended September 30, 2017 since such shares, if redeemed, only participate in their pro rata share ofand has no impact on the trust earnings. The Company has not considered the effect of warrants sold in the Initial Public Offering in the calculation of diluted income per share, since their inclusion would be anti-dilutive.


Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash accounts in a financial institution which may exceed the Federal depository insurance coverage of $250,000. The Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.

Fair Value of Financial Instruments

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under FASB ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the balance sheet with the exception of investments in Trust, as they are carried at amortized cost.

Use of Estimates

The preparation of the condensed financial statements in conformity with U.S. generally accepted accounting principles requires management2018. 

Results from Discontinued Operations
Income from discontinued operations, net of tax, for the three and nine months ended September 30, 2017 was as follows:
(in thousands)Three Months Ended
September 30, 2017 		Nine Months Ended
September 30, 2017 
Remote accommodations revenue$36,767 $95,332 
Rental unit sales 1,522 1,522 
Remote accommodations costs of leasing and services 16,621 41,359 
Rental unit cost of sales 885 885 
Depreciation of rental equipment5,653 18,195 
Gross profit15,130 36,415 
Selling, general and administrative expenses3,307 9,838 
Other depreciation and amortization1,255 3,763 
Restructuring costs803 1,573 
Other income, net(56)(96)
Operating profit9,821 21,337 
Interest expense654 2,074 
Income from discontinued operations, before income tax9,167 19,263 
Income tax expense4,089 8,140 
Income from discontinued operations, net of tax$5,078 $11,123 
Revenues and costs related to make estimatesthe Remote Accommodations Business for the three and assumptions that affectnine months ended September 30, 2017 were as follows:
(in thousands)Three Months Ended
September 30, 2017 		Nine Months Ended
September 30, 2017 
Remote accommodations revenue:
Lease revenue$14,979 $43,556 
Service revenue21,788 51,776 
Total remote accommodations revenue$36,767 $95,332 
Remote accommodation costs:
Cost of leases$2,329 $6,529 
Cost of services14,292 34,830 
Total remote accommodations costs of leasing and services$16,621 $41,359 
Cash flows from the reported amountsCompany’s discontinued operations are included in the condensed consolidated statements of cash flows. The significant cash flow items from discontinued operations for the nine months ended September 30, 2017 were as follows:
(in thousands)September 30, 2017 
Depreciation and amortization$21,958 
Capital expenditures$6,855 


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NOTE 4 - Inventories
Inventories at the respective balance sheet dates consisted of the following:
(in thousands) September 30, 2018December 31, 2017
Raw materials and consumables $19,107 $10,082 
Work in process 2,241 — 
Total inventories $21,348 $10,082 

NOTE 5 - Rental Equipment, net
Rental equipment, net, at the respective balance sheet dates consisted of the following:
(in thousands)September 30, 2018 December 31, 2017 
Modular units and portable storage $2,326,909 $1,385,901 
Value added products 88,642 59,566 
Total rental equipment 2,415,551 1,445,467 
Less: accumulated depreciation (466,148)(405,321)
Rental equipment, net $1,949,403 $1,040,146 
During the three and nine months ended September 30, 2018, the Company received $0.0 million and $9.3 million, respectively, in insurance proceeds related to assets damaged during Hurricane Harvey. The insurance proceeds exceeded the book value of damaged assets, and liabilitiesthe Company recorded gains of $0.0 million and disclosure$4.8 million which are reflected in other (income) expense, net, on the condensed consolidated statements of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates.

Redeemable Ordinary Shares

As discussed in Note 1, all of the Class A ordinary shares sold as parts of the Units in the Public Offering contain a redemption feature which allowsoperations for the redemption of Class A ordinary shares under the Company’s amendedthree and restated memorandumnine months ended September 30, 2018, respectively.


NOTE 6 - Goodwill and articles of association. In accordance with FASB ASC 480, redemption provisions not solely within the control of the Company require the security to be classified outside of permanent equity. Ordinary liquidation events, which involve the redemption and liquidation of all of the entity’s equity instruments, are excluded from the provisions of FASB ASC 480. Although the Company has not specified a maximum redemption threshold, its amended and restated memorandum and articles of association provide that in no event will the Company redeem its public shares in an amount that would cause its net tangible assets to be less than $5,000,001.

The Company recognizes changes in redemption value immediately as they occur and will adjust the carrying value of the security to equal the redemption value at the end of each reporting period. Increases or decreasesIntangible Assets

Changes in the carrying amount of redeemable Classgoodwill were as follows:
(in thousands)Modular – US
Modular – Other
North America
Total
Balance at January 1, 2017 $— $56,811 $56,811 
Acquisition of a business 28,609 — 28,609 
Effects of movements in foreign exchange rates — 3,932 3,932 
Impairment losses — (60,743)(60,743)
Balance at December 31, 2017 28,609 — 28,609 
Acquisition of businesses 206,667 32,538 239,205 
Changes to preliminary purchase price allocations (396)— (396)
Effects of movements in foreign exchange rates — 346 346 
Balance at September 30, 2018 $234,880 $32,884 $267,764 
As described in Note 2, the Company acquired ModSpace in August 2018. A ordinary shares shall be affected by charges against additional paid in capital. Accordingly, at September 30, 2017 and December 31, 2016, 47,428,415 and 47,702,674, respectivelypreliminary valuation of the Class A ordinary shares included in the Units (as defined below) were classified outsideacquired net assets of permanent equity at its redemption value.

Income Taxes

The Company complies with the accounting and reporting requirements of FASB ASC 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized.

There were no unrecognized tax benefits as of September 30, 2017. FASB ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for the payment of interest and penalties at September 30, 2017 or December 31, 2016. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company could be subject to income tax examinations by major taxing authorities from inception.

There is currently no taxation imposed on income by the Government of the Cayman Islands. In accordance with Cayman federal income tax regulations, income taxes are not levied on the Company. Consequently, income taxes are not reflected in the Company's financial statements. The Company's management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

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Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements.

3.Public Offering

On September 16, 2015, the Company sold 50,000,000 units at a price of $10.00 per unit (the “Units”) in the Public Offering. Each Unit consists of one Class A ordinary share of the Company, $0.0001 par value per share (the “Public Shares”), and one warrant to purchase one-half of one Class A ordinary share (the “Public Warrants”).

Each Public Warrant entitles the holder to purchase one-half of one Class A ordinary share at a price of $5.75 per one-half share ($11.50 per whole share). No fractional shares will be issued upon exercise of the Public Warrants. If, upon exercise of the Public Warrants, a holder would be entitled to receive a fractional interest in a share, the Company will, upon exercise, round down to the nearest whole number the number of Class A ordinary shares to be issued to the Public Warrant holder. Each Public Warrant will become exercisable on the later of 30 days after the completion of the Company’s Business Combination and 12 months from the closing of the Public Offering. However, if the Company does not complete a Business Combination on or prior to the 24-month period allotted to complete the Business Combination, the Public Warrants will expire at the end of such period. Under the terms of a warrant agreement between the Company and Continental Stock Transfer & Trust Company, as warrant agent, the Company has agreed to, following the completion of the Company’s Business Combination, use its best efforts to file a new registration statement under the Securities Act for the registration of the Class A ordinary shares issuable upon exercise of the Public Warrants. If the Company is unable to deliver registered Class A ordinary shares to the holder upon exercise of Public Warrants during the exercise period, there will be no net cash settlement of these Public Warrants and the Public Warrants will expire worthless, unless they may be exercised on a cashless basis in the circumstances described in the warrant agreement.

The Company paid an upfront underwriting discount of $8,000,000 ($0.16 per Unit sold) in the aggregate to the underwriters at the closing of the Public Offering, with an additional fee (the “Deferred Discount”) equal to the difference between (a) the product of the number of Class A ordinary shares sold as part of the Units and $0.55 and (b) the upfront underwriting discounts paid at the closing of $8,000,000, or a total Deferred Discount of $19,500,000 ($0.39 per Unit sold). The Deferred Discount will become payable to the underwriters from the amounts held in the Trust Account solely in the event the Company completes the Business Combination. The underwriters are not entitled to any interest accrued on the Deferred Discount.

The closing of the Public Offering included an initial partial exercise (2,000,000 units) of the overallotment option granted to the underwriters.

4.Related Party Transactions

Founder Shares

On July 1, 2015, the Sponsor purchased 12,218,750 Class B ordinary shares (the “Founder Shares”) for $25,000, or approximately $.002 per share. On July 29, 2015, the Sponsor transferred 6,109,375 Founder Shares to Harry E. Sloan for a purchase price of $12,500 (the same per-share purchase price initially paid by the Sponsor). On August 27, 2015, the Sponsor and Mr. Sloan transferred an aggregate of 25,000 Founder Shares on a pro rata basis to each of the Company’s independent directors at their original purchase price. On August 27, 2015, Mr. Sloan transferred 665,500 Founder Shares to the Sponsor. On September 10, 2015, the Company effected a share capitalization of approximately .129 shares for each outstanding Class B ordinary share, resulting in the initial shareholders holding an aggregate of 13,800,000 Founder Shares. The closing of the Public Offering included an initial partial exercise (2,000,000 units) of the overallotment option granted to the underwriters whichModSpace resulted in the forfeiturerecognition of an aggregate$203.3 million and $32.5 million of 1,300,000 Founder Shares (the “Forfeited Founder Shares”) bygoodwill in the Sponsor, Harry E. SloanModular - US segment and the Company’s independent directors (consisting of 1,271,771 Forfeited Founder Shares forfeited by the Sponsor, 18,524 Founder Shares forfeited by Harry E. Sloan and 3,235 Forfeited Founder Shares forfeited by each of the Company’s independent directors) due to the underwriters not exercising their over-allotment option in full and such that the remaining Founders Shares will equal 20% of the equity capital of the Company.

The Founder Shares are identical to the Public Shares except that the Founder Shares are subject to certain transfer restrictions, as described in more detail below.


The initial shareholders have agreed not to transfer, assign or sell any of their Founder Shares until the earlier of (A) one year after the completion of the Company’s initial Business Combination, or earlier if, subsequent to the Company’s initial Business Combination, the closing price of the Company’s Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Company’s initial Business Combination, and (B) the date onModular - Other North America segment, which the Company completes a liquidation, merger, share exchange or other similar transaction afterexpects will be non-deductible for income tax purposes. The Company expects to finalize the initial Business Combination that results in allvaluation of the Company’s shareholders havingacquired net assets of ModSpace within the right to exchange their Classone-year measurement period from the date of acquisition. 

As described in Note 2, the Company acquired Tyson in January 2018. A ordinary sharespreliminary valuation of the acquired net assets of Tyson resulted in the recognition of $3.4 million of goodwill in the Modular - US segment, which the Company expects will be deductible for cash, securities or other property (the “Lock Up Period”).

Rights — The Founder Shares are identicaltax purposes. During the three and nine months ended September 30, 2018, the Company made a $0.3 million and $0.7 million adjustment to the Public Shares except that (i)preliminary valuation of the Founder Shares are subjectacquired net assets of Tyson, including the related goodwill, due to certain transfer restrictions, as described above,further evaluation of rental equipment and (ii)property, plant and equipment, and non-indemnified liabilities.

As discussed in further detail in Note 2, the initial shareholders have agreed to waive their redemption rightsCompany acquired Acton in connection withDecember 2017. A preliminary valuation of the Business Combination with respectacquired net assets of Acton resulted in the recognition of $28.6 million of goodwill to the Founder Shares and any Public Shares they may purchase, and to waive their redemption rights with respect toModular - US segment, as defined in Note 14, for the Founder Shares ifyear ended December 31, 2017. During the three months ended September 30, 2018, the Company failsmade a $1.7 million net adjustment that increased the acquired net assets of Acton, primarily due to complete a Business Combination by December 31, 2017.

Voting — The initial shareholders have agreed to vote their Founder Shares and any Public Shares purchased during or after the Public Offering in favorfurther evaluation of the Business Combination.

Liquidation — Although the initial shareholders and their permitted transferees have waived their redemption rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the prescribed time frame, they will be entitled to redemption rights with respect to any Public Shares they may own.

Private Placement Warrants

The Sponsor, Harry E. Sloan and the Company’s independent directors (and/or one or more of their estate planning vehicles) purchased from the Company 19,500,000 warrants in the aggregate at a price of $0.50 per warrant (an aggregate purchase price of $9.75 million) in a private placement that occurred simultaneously with the completion of the Public Offering (the “Private Placement Warrants”). Each Private Placement Warrant entitles the holder to purchase one-half of one Class A ordinary share at $5.75 per one-half share ($11.50 per whole share). The purchase price of the Private Placement Warrants has been added to the proceeds from the Public Offering to be held in the Trust Account pending completion of the Company’s initial Business Combination. The Private Placement Warrants (including the Class A ordinary shares issuable upon exercise of the Private Placement Warrants) will not be transferable, assignable or salable until 30 days after the completion of the initial Business Combination, and they will be non-redeemable so long as they are held by the initial purchasers of the Private Placement Warrants or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers of the Private Placement Warrants or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. Otherwise, the Private Placement Warrants have terms and provisions that are identical to those of the Public Warrants and have no net cash settlement provisions.

If the Company does not complete the Business Combination, then the proceeds will be part of the liquidating distribution to the public shareholders and the Private Placement Warrants will expire worthless.

Registration Rights

The initial shareholders and holders of the Private Placement Warrants will be entitled to registration rights pursuant to a registration rights agreement signed on September 10, 2015. The initial shareholders and holders of the Private Placement Warrants will be entitled to make up to three demands, excluding short form registration demands, that the Company register such securities for sale under the Securities Act. In addition, these holders will have “piggy-back” registration rights to include their securities in other registration statements filed by the Company. However, the registration rights agreement provides that the Company will not permit any registration statement filed under the Securities Act to become effective until termination of the applicable Lock Up Period. The Company will bear the expenses incurred in connection with the filing of any such registration statements.

Advances from Sponsor

insurance related receivables. During the nine months ended September 30, 2017,2018, the SponsorCompany made advancesnet adjustments of

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$0.3 million that decreased the acquired net assets of Acton, due to further evaluation of rental equipment and non-indemnified liabilities partially offset by changes in insurance-related receivables and deferred tax assets.
  The gross carrying amount, accumulated amortization and net book value ("NBV") of the intangible assets at the respective balance sheet dates consisted of the following:
(in thousands) September 30, 2018December 31, 2017
Gross Carrying Amount Accumulated Amortization NBV Gross Carrying Amount Accumulated Amortization NBV 
Intangible assets subject to amortization: 
Favorable lease rights $4,401 $(60)$4,341 $551 $— $551 
Acton and ModSpace trade names 3,708 (530)3,178 708 — 708 
Total intangible assets subject to amortization $8,109 $(590)$7,519 $1,259 $— $1,259 
Indefinite-lived intangible assets: 
Trade names $125,000 $— $125,000 $125,000 $— $125,000 
Total intangible assets other than goodwill $133,109 $(590)$132,519 $126,259 $— $126,259 
As described in Note 2, the Company acquired ModSpace in August 2018, and preliminarily allocated $3.0 million and $3.9 million to definite-lived intangible assets, related to the Company totaling $380,000.ModSpace trade name and favorable lease rights, to the Modular - US segment. The advances are non-interest bearingtrade name has an estimated useful life of three years and are due on demand.


Administrative Services

the favorable lease asset has an estimated useful life of six years. The Company will reimburseexpects the Sponsorintangibles to be non-deductible for office space, secretarial and administrative services providedincome tax purposes. The Company expects to membersfinalize the valuation of the Company’s management team byacquired net assets of ModSpace, including the Sponsor, membersrelated intangible assets, within the one-year measurement period from the date of acquisition.


NOTE 7 - Debt
The carrying value of debt outstanding at the respective balance sheet dates consisted of the Sponsor,following:
(in thousands, except rates)Interest rateYear of maturitySeptember 30, 2018 December 31, 2017 
2022 Secured Notes 7.875%  2022 $291,853 $290,687 
2023 Secured Notes 6.875%  2023 293,637 — 
Unsecured Notes 10.000%  2023 198,882 — 
US ABL Facility Varies 2022 830,573 297,323 
Canadian ABL Facility (a) Varies 2022 — — 
Capital lease and other financing obligations 38,549 38,736 
Total debt 1,653,494 626,746 
Less: current portion of long-term debt (1,915)(1,881)
Total long-term debt $1,651,579 $624,865 
(a) As of September 30, 2018, the Company had $1.5 million of outstanding principal borrowings on the Canadian ABL Facility and $3.3 million of related debt issuance costs. $1.5 million of the related debt issuance costs are recorded as a direct offset against the principal of the Canadian ABL Facility and the remaining $1.8 million, in excess of the principal, has been included in other non-current assets on the condensed consolidated balance sheet. As there were no principal borrowings outstanding on the Canadian ABL Facility as of December 31, 2017, $1.8 million of debt issuance costs related to that facility are included in other non-current assets on the condensed consolidated balance sheet.


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ABL Facilities
Former Algeco Group Revolver
Prior to the Business Combination, WSII depended on the Algeco Group for financing, which centrally managed all treasury and cash management. In October 2012, the Algeco Group entered into a multi-currency asset-based revolving credit facility (the “Algeco Group Revolver”), which had a maximum aggregate availability of the equivalent of $1.355 billion. The maximum borrowing availability to WSII in US dollars and Canadian dollars (“CAD”) was $760.0 million and $175.0 million, respectively.
Interest expense of $8.7 million and $23.2 million related to the Algeco Group Revolver was included in interest expense for the three and nine months ended September 30, 2017.
ABL Facility
On November 29, 2017, WS Holdings, WSII and certain of its subsidiaries entered into an ABL credit agreement (the “ABL Facility”) that provided a senior secured revolving credit facility in the initial aggregate principal amount of up to $600.0 million. The ABL Facility matures on May 29, 2022.
In July and August 2018, the Company entered into three amendments (the "ABL Amendments") to the ABL Facility that, among other things, (i) permitted the ModSpace acquisition and the Company’s management team or their affiliatesfinancing thereof, (ii) increased the ABL Facility limit to $1.425 billion in the aggregate, with an accordion feature allowing up to $1.8 billion of capacity, and (iii) increased certain thresholds, basket sizes and default and notice triggers to account for the Company’s increased scale following the ModSpace acquisition.
After giving effect to the ABL Amendments, the ABL Facility, which matures on May 29, 2022, consists of (i) a $1.285 billion asset-backed revolving credit facility (the “US ABL Facility”) for WSII and certain of its domestic subsidiaries (the “US Borrowers”), (ii) a $140.0 million asset-based revolving credit facility (the “Canadian ABL Facility”) for certain Canadian subsidiaries of WSII (the “Canadian Borrowers,” and together with the US Borrowers, the “Borrowers”), and (iii) an accordion feature that permits the Borrowers to increase the lenders’ commitments in an aggregate amount not to exceed $15,000$375.0 million, subject to the satisfaction of customary conditions, plus any voluntary prepayments that are accompanied by permanent commitment reductions under the ABL Facility.
Borrowings under the ABL Facility, at the Borrower’s option, bear interest at an adjusted LIBOR or base rate, in each case plus an applicable margin. At inception of the ABL Facility until March 31, 2018, the applicable margin was fixed at 2.50% for LIBOR borrowings and 1.50% for base rate borrowings. Commencing on March 31, 2018, the applicable margins are subject to one step-down of 0.25% or one step-up of 0.25%, based on excess availability levels with respect to the ABL Facility. The ABL Facility requires the payment of an annual commitment fee on the unused available borrowings of between 0.375% and 0.5% per monthannum. At September 30, 2018, the weighted average interest rate for borrowings under the ABL Facility was 4.65%.
Borrowing availability under the US ABL Facility and the Canadian ABL Facility is equal to the lesser of (i) with respect to US Borrowers, $1.285 billion and the US Borrowing Base (defined below) (the “US Line Cap”), and (ii) with respect to the Canadian Borrower, $140.0 million and the Canadian Borrowing Base (defined below) (the “Canadian Line Cap,” together with the US Line Cap, the “Line Cap”).
The US Borrowing Base is, at any time of determination, an amount (net of reserves) equal to the sum of:
◦ 85% of the net book value of the US Borrowers’ eligible accounts receivable, plus
◦ the lesser of (i) 95% of the net book value of the US Borrowers’ eligible rental equipment and (ii) 85% of the net orderly liquidation value of the US Borrowers’ eligible rental equipment, minus
◦ customary reserves.
The Canadian Borrowing Base is, at any time of determination, an amount (net of reserves) equal to the sum of:
◦ 85% of the net book value of the Canadian Borrowers’ eligible accounts receivable, plus
◦ the lesser of (i) 95% of the net book value of the Canadian Borrowers’ eligible rental equipment and (ii) 85% of the net orderly liquidation value of the Canadian Borrowers’ eligible rental equipment, plus
◦ portions of the US Borrowing Base that have been allocated to the Canadian Borrowing Base, minus
◦ customary reserves.
At September 30, 2018, the Line Cap was $1.425 billion and the Borrowers had $552.9 million of available borrowing capacity under the ABL Facility, including $414.5 million under the US ABL Facility and $138.4 million under the Canadian ABL Facility. At December 31, 2017, prior to the ABL Amendments, the Line Cap was $600.0 million and the Borrowers had $281.1 million of available borrowing capacity under the ABL Facility, including $211.1 million under the US ABL Facility and $70.0 million under the Canadian ABL Facility.
Borrowing capacity under the US ABL Facility is made available for up to $75.0 million of standby letters of credit and up to $75.0 million of swingline loans, and borrowing capacity under the Canadian ABL Facility is made available for up to $60.0 million of standby letters of credit, and $50.0 million of swingline loans. Letters of credit and bank guarantees carried
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fees of 2.625% at September 30, 2018 and December 31, 2017. The Company had issued $13.0 million and $8.9 million of standby letters of credit under the ABL Facility at September 30, 2018 and December 31, 2017.
The ABL Facility requires the Borrowers to maintain a (i) minimum interest coverage ratio of 2.00:1.00 and (ii) maximum total net leverage ratio of 5.50:1.00, in each case, at any time when the excess availability under the ABL Facility is less than the greater of (a) $135.0 million and (b) an amount equal to 10% of the Line Cap.
The ABL Facility also contains a number of customary negative covenants. Such covenants, among other things, may limit or restrict the ability of each of the Borrowers, their restricted subsidiaries, and where applicable, WS Holdings, to: incur additional indebtedness, issue disqualified stock and make guarantees; incur liens; engage in mergers or consolidations or fundamental changes; sell assets; pay dividends and repurchase capital stock; make investments, loans and advances, including acquisitions; amend organizational documents and master lease documents; enter into certain agreements that would restrict the ability to pay dividends or incur liens on assets; repay certain junior indebtedness; enter into sale and leaseback transactions; and change the conduct of its business.
The aforementioned restrictions are subject to certain exceptions including (i) the ability to incur additional indebtedness, liens, investments, dividends, and prepayments of junior indebtedness subject, in each case, to compliance with certain financial metrics and certain other conditions and (ii) a number of other traditional exceptions that grant the Borrowers continued flexibility to operate and develop their businesses. The ABL Facility also contains customary representations and warranties, affirmative covenants and events of default. The Company is in compliance with these covenants and restrictions as of September 30, 2018.
The Company had $859.0 million and $310.0 million in outstanding principal under the ABL Facility at September 30, 2018 and December 31, 2017, respectively.
The ABL Amendments were treated as a debt modification to the ABL Facility under ASC 470-50, Debt, Modifications and Extinguishments. All ABL Facility lenders prior to the ABL Amendments are continuing lenders after giving effect to the ABL Amendments. The Company incurred an additional $19.0 million in debt issuance costs and discounts associated with the ABL Amendments that have been deferred and will be amortized through the remaining period until the maturity date of the ABL Facility.  Debt issuance costs and discounts of $28.5 million and $12.7 million are included in the eventcarrying value of the ABL Facility at September 30, 2018 and December 31, 2017, respectively.
Interest expense of $7.6 million and $15.8 million related to the ABL Facility was included in interest expense for the three and nine months ended September 30, 2018.
2022 Senior Secured Notes
WSII has $300.0 million aggregate principal amount of 7.875% senior secured notes due December 15, 2022 (the “2022 Secured Notes”) under an indenture dated November 29, 2017, which was entered into by and among WSII, the guarantors named therein, and Deutsche Bank Trust Company Americas, as trustee and as collateral agent. Interest is payable semi-annually on June 15 and December 15, beginning June 15, 2018.
Before December 15, 2019, WSII may redeem the 2022 Secured Notes at a redemption price equal to 100% of the principal amount, plus a customary make whole premium for the 2022 Secured Notes being redeemed, plus accrued and unpaid interest, if any, to but not including the redemption date.
The customary make whole premium, with respect to the 2022 Secured Notes on any applicable redemption date, as calculated by the Company, is the greater of (i) 100% of the then outstanding principal amount of the 2022 Secured Notes; and (ii) the excess of (a) the present value at such space and/redemption date of (i) the redemption price set on or services are utilizedafter December 15, 2019 plus (ii) all required interest payments due on the 2022 Secured Notes through December 15, 2019, excluding accrued but unpaid interest to the redemption date, in each case, computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over (b) the then outstanding principal amount of the 2022 Secured Notes.
Before December 15, 2019, WSII may redeem up to 40% of the aggregate principal amount of the 2022 Secured Notes at a price equal to 107.875% of the principal amount of the 2022 Secured Notes being redeemed, plus accrued and unpaid interest, if any, to but not including the redemption date with the net proceeds of certain equity offerings. At any time prior to November 29, 2019, WSII may also redeem up to 10% of the aggregate principal amount of the 2022 Secured Notes at a redemption price equal to 103% of the principal amount of the Notes being redeemed during each twelve-month period commencing with the closing date, plus accrued and unpaid interest, if any, to but not including the redemption date. If WSII undergoes a change of control or sells certain of its assets, WSII may be required to offer to repurchase the 2022 Secured Notes.

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On or after December 15, 2019, WSII, may redeem the 2022 Secured Notes, in whole or in part, at the redemption prices expressed as percentages of principal amount set forth below, plus accrued and unpaid interest to, but not including, the applicable redemption date (subject to the holders' right to receive interest due on an interest payment date falling on or prior to the redemption date), if redeemed during the twelve month period beginning on December 15 of each of the years set forth below:
YearRedemption Price
2019103.938 %
2020101.969 %
2021 and thereafter100.000 %
The 2022 Secured Notes contain certain negative covenants, including limitations that may restrict WSII’s ability and the ability of certain of its subsidiaries, to directly or indirectly, create additional financial obligations. With certain specified exceptions, these negative covenants prohibit WSII and certain of its subsidiaries from: creating or incurring additional debt; paying dividends or making any other distributions with respect to its capital stock; making loans or advances to WillScot or any restricted subsidiary of WSII; selling, leasing or transferring any of its property or assets to WillScot or any restricted subsidiary of WSII; directly or indirectly creating, incurring or assuming any lien of any kind securing debt on the collateral; or entering into any sale and leaseback transaction. On August 15, 2018, in conjunction with the ModSpace acquisition and related debt issuances, WSII entered a supplemental indenture to, among other things, join ModSpace and its domestic subsidiaries as guarantors of the 2022 Secured Notes.
The aforementioned restrictions are subject to certain exceptions including (i) the ability to incur additional indebtedness, liens, investments, dividends and distributions, and prepayments of junior indebtedness subject, in each case, to compliance with certain financial metrics and certain other conditions and (ii) a number of other traditional exceptions that grant the US Borrowers continued flexibility to operate and develop their businesses. The Company doesis in compliance with these covenants and restrictions as of September 30, 2018 and December 31, 2017.
Unamortized debt issuance costs pertaining to the 2022 Secured Notes was $8.1 million and $9.3 million as of September 30, 2018 and December 31, 2017, respectively.
2023 Senior Secured Notes
On August 6, 2018, a special purpose subsidiary of WSII completed a private offering of $300.0 million in aggregate principal amount of its 6.875% senior secured notes due August 15, 2023 (“2023 Secured Notes”). The issuer entered into an indenture dated August 6, 2018 with Deutsche Bank Trust Company Americas, as trustee (“2023 Secured Notes Indenture”), which governs the terms of the 2023 Secured Notes. In connection with the ModSpace acquisition, the issuer merged with and into WSII and WSII assumed the 2023 Secured Notes. Interest is payable semi-annually on February 15 and August 15 of each year, beginning February 15, 2019.
WSII may redeem the 2023 Secured Notes at any time before August 15, 2020 at a redemption price equal to 100% of the principal amount thereof, plus a customary make whole premium for the 2023 Secured Notes being redeemed, plus accrued and unpaid interest, if any, to but not payincluding the redemption date. Before August 15, 2020, WSII may redeem up to 40% of the aggregate principal amount of the 2023 Secured Notes at a price equal to 106.875% of the principal amount of the 2023 Secured Notes being redeemed, plus accrued and unpaid interest, if any, to but not including the redemption date with the net proceeds of certain equity offerings. WSII may also redeem up to 10% of the aggregate principal amount of the 2023 Secured Notes at any time prior to the second anniversary of the closing date of this offering at a redemption price equal to 103% of the principal amount of the 2023 Secured Notes being redeemed during each twelve-month period commencing with the issue date, plus accrued and unpaid interest, if any, to but not including the redemption date. If WSII undergoes a change of control or sells certain of its assets, WSII may be required to offer to repurchase the 2023 Secured Notes.
On and after August 15, 2020, WSII may redeem the 2023 Secured Notes, in whole or in part, at the redemption prices expressed as percentages of principal amount set forth below plus accrued and unpaid interest to but not including the applicable redemption date (subject to the holders' right to receive interest due on an interest payment date falling on or prior to the redemption date), if redeemed during the 12 month period beginning on August 15 of each of the years set forth below.
Year Redemption Price 
2020103.938 %
2021101.969 %
2022 and thereafter 100.000 %
The 2023 Secured Notes are unconditionally guaranteed by each of WSII’s direct and indirect domestic subsidiaries and WSII’s parent, WS Holdings (collectively the “Note Guarantors”). WillScot is not a guarantor of the 2023 Secured Notes. The Note Guarantors and certain of the Company's non-US subsidiaries are guarantors or borrowers under the ABL Facility. These guarantees are secured by a second priority security interest in substantially all of the assets of WSII and the Note Guarantors (subject to customary exclusions) and are subordinated to the Company's obligations under the ABL Facility.
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The 2023 Secured Notes contain certain negative covenants, including limitations that may restrict WSII’s ability and the ability of certain of its subsidiaries, to directly or indirectly, create additional financial obligations. With certain specified exceptions, these negative covenants prohibit WSII and certain of its subsidiaries from: creating or incurring additional debt; paying dividends or making any other distributions with respect to its capital stock; making loans or advances to WillScot or any restricted subsidiary of WSII; selling, leasing or transferring any of its property or assets to WillScot or any restricted subsidiary of WSII; directly or indirectly creating, incurring or assuming any lien of any kind securing debt on the collateral; or entering into any sale and leaseback transaction.
The aforementioned restrictions are subject to certain exceptions including (i) the ability to incur additional indebtedness, liens, investments, dividends and distributions, and prepayments of junior indebtedness subject, in each case, to compliance with certain financial metrics and certain other conditions and (ii) a number of other traditional exceptions that grant the US Borrowers continued flexibility to operate and develop their businesses. The Company is in compliance with these covenants and restrictions as of September 30, 2018.
The Company incurred debt issuance costs and discounts of $6.5 million in connection with the 2023 Secured Notes. Debt issuance costs and discounts of $6.4 million are included in the carrying value of the debt at September 30, 2018.
2023 Senior Unsecured Notes
On August 3, 2018, a special purpose subsidiary of WSII completed a private offering of $200.0 million in aggregate principal amount of its senior unsecured notes due November 15, 2023 (the “Unsecured Notes”). The issuer entered into an indenture with Deutsche Bank Trust Company Americas, as trustee (the “Unsecured Notes Indenture”), which governs the terms and conditions of the Unsecured Notes. In connection with the ModSpace acquisition, the issuer merged with and into WSII and WSII assumed the Unsecured Notes.
The Unsecured Notes bear interest at a rate of 10% per annum if paid in cash (or if paid in kind, 11.5% per annum) for any interest period ending on or before February 15, 2021, and thereafter are payable solely in cash at an increased rate per annum of 12.5%. Interest is payable semi-annually on February 15 and August 15 of each year, beginning February 15, 2019.
The Unsecured Notes are not prepayable until February 15, 2019. From time to time during the period from February 15, 2019 through August 14, 2019, WSII may redeem the Unsecured Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the Unsecured Notes, plus the Applicable Premium (as defined in the Unsecured Notes Indenture) as of, and accrued and unpaid interest to, but not including the redemption date (subject to the holders' right to receive interest due on an interest payment date falling on or prior to the redemption date); provided, that if the Unsecured Notes are being redeemed in part, such redemption will not reduce the aggregate principal amount of the Unsecured Notes outstanding below $50.0 million (together with any PIK Interest in respect thereof). If WSII undergoes a change of control or sells certain of its assets, WSII may be required to offer to repurchase the Unsecured Notes.
At any time and from time to time on and after August 15, 2019, WSII, at its option, may redeem the Unsecured Notes, in whole or in part, at the redemption prices expressed as percentages of principal amount set forth below plus accrued and unpaid interest to but not including the applicable redemption date (subject to the right of Holders (as defined therein) on the relevant record date to receive interest due on an interest payment date falling on or prior to the redemption date), if redeemed during the periods referred to below, beginning on August 15, 2019; provided however, that if the Unsecured Notes are being redeemed in part, such redemption will not reduce the aggregate principal amount of the Unsecured Notes outstanding below $50.0 million (together with any PIK Interest in respect thereof).
Year Redemption Price 
August 15, 2019 to February 14, 2020102.000 %
February 15, 2020 to February 14, 2021104.000 %
February 15, 2021 and thereafter 106.000 %
The Unsecured Notes are unconditionally guaranteed by each Note Guarantor. These guarantees are senior, unsecured obligations of the Note Guarantors (except that the guarantee of the Unsecured Notes provided by WillScot Equipment II, LLC, which holds certain of WSII’s uncertificated assets in the United States, are subordinated to its obligations under the ABL Facility).
The Unsecured Notes contain certain negative covenants, including limitations that may restrict WSII’s ability and the ability of certain of its subsidiaries, to directly or indirectly, create additional financial obligations. With certain specified exceptions, these negative covenants prohibit WSII and certain of its subsidiaries from: creating or incurring additional debt; paying dividends or making any other distributions with respect to its capital stock; making loans or advances to WillScot or any restricted subsidiary of WSII; selling, leasing or transferring any of its property or assets to WillScot or any restricted subsidiary of WSII; directly or indirectly creating, incurring or assuming any lien of any kind securing debt on the collateral; or entering into any sale and leaseback transaction.
The aforementioned restrictions are subject to certain exceptions including (i) the ability to incur additional indebtedness, liens, investments, dividends and distributions, and prepayments of junior indebtedness subject, in each case, to compliance with certain financial metrics and certain other conditions and (ii) a number of other traditional exceptions that
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grant the US Borrowers continued flexibility to operate and develop their businesses. The Company is in compliance with these covenants and restrictions as of September 30, 2018.
The Company incurred debt issuance costs and discounts of $1.1 million in connection with the issuance of the Unsecured Notes. Debt issuance costs and discounts of $1.1 million are included in the carrying value of the Unsecured Notes at September 30, 2018. 
Bridge Financing Fees
In connection with the ModSpace acquisition, the Company incurred bridge financing fees of $20.5 million, included within interest expense in the condensed consolidated statement of operations, for the three and nine months ended September 30, 2018. 
Capital Lease and Other Financing Obligations
The Company’s capital lease and financing obligations primarily consisted of $38.4 million and $38.5 million under sale-leaseback transactions and $0.1 million and $0.2 million of capital leases at September 30, 2018 and December 31, 2017, respectively. The Company’s capital lease and financing obligations are presented net of $1.6 million and $1.8 million of debt issuance costs at September 30, 2018 and December 31, 2017, respectively. The Company’s capital leases primarily relate to real estate, equipment and vehicles and have interest rates ranging from 1.2% to 11.9%.
The Company has entered into several arrangements in which it has sold branch locations and simultaneously leased the associated properties back from the various purchasers. Due to the terms of the lease agreements, these transactions are treated as financing arrangements. These transactions contain non-recourse financing which is a form of continuing involvement and precludes the use of sale-lease back accounting. The terms of the financing arrangements range from approximately eighteen months to ten years. The interest rates implicit in these financing arrangements is approximately 8.0%.
Notes Due To and From Affiliates
In conjunction with the Business Combination, all notes due to and from affiliates were settled, and there is no related interest expense or interest income related to the notes due to or from affiliates for the three and nine months ended September 30, 2018.
Prior to the Business Combination, the Algeco Group distributed borrowings from its third party directlynotes to entities within the Algeco Group, including WSII, through intercompany loans. WSII previously recorded these intercompany loans as notes due to affiliates with maturity dates of June 30, 2018 and October 15, 2019.
Interest expense of $16.7 million and $48.0 million associated with these notes due to affiliates is reflected in interest expense in the consolidated statement of operations for such services, from the date of closing ofthree and nine months ended September 30, 2017, respectively. Interest on the Public Offering.notes due to affiliates was payable on a semi-annual basis.
Conversely, WSII also distributed borrowings to other entities within the Algeco Group through intercompany loans, and earned interest income on the principal. For the three and nine months ended September 30, 2017, and 2016, the Company incurred $45,000recognized $3.7 million and $135,000,$9.8 million, respectively, of administrative services under this arrangement for each period. Upon completion of a Business Combination or the Company’s liquidation, the Company will cease paying these monthly fees. At September 30, 2017, accounts payable included $75,000 payable to the Sponsor.

5.Commitments & Contingencies

The Company is committed to pay the Deferred Discount totaling $19,500,000, or 3.9% of the gross offering proceeds of the Public Offering, to the underwriters upon the Company’s consummation of a Business Combination. The underwriters will not be entitled to any interest accrued on the Deferred Discount, and no Deferred Discount is payable to the underwriters if there is no Business Combination.

6.Trust Account and Fair Value Measurements

As of September 30, 2017 and December 31, 2016, investment securities in the Company’s Trust Account consisted of $500,828,173 and $501,340,048, respectively in United States Treasury Bills and another $381 and $862, respectively held as cash and cash equivalents. The Company classifies its Treasury Instruments and equivalent securities as held-to-maturity in accordance with FASB ASC 320 “Investments – Debt and Equity Securities”. Held-to-maturity securities are those securities which the Company has the ability and intent to hold until maturity. Held-to-maturity treasury securities are recorded at amortized cost on the accompanying balance sheets and adjusted for the amortization or accretion of premiums or discounts. The following table presents fair value information as of September 30, 2017 and December 31, 2016 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. In addition, the table presents the carrying value (held to maturity), excluding accrued interest income and gross unrealized holding gain. Since all of the Company’s permitted investments consist of U.S. government treasury bills and cash, fair values of its investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in active markets for identical assets as follows:

  Carrying
Value		  Gross
Unrealized
Holding
Gain (Loss)		  Quoted prices
in
Active
Markets
(Level 1)		 
          
U.S. Government Treasury Securities as of September 30, 2017(1) $500,828,173  $3,577  $500,831,750 
             
U.S. Government Treasury Securities as of December 31, 2016(2) $501,340,048  $(23,491) $501,316,557 

(1)Maturity date October 2017.
(2)Maturity dates ranging from January to February 2017.

7.Shareholders’ Equity

Ordinary Shares — The authorized ordinary shares of the Company include up to 400,000,000 shares, including 380,000,000 Class A ordinary shares and 20,000,000 Class B ordinary shares. Holders of the Class A ordinary shares and holders of the Class B ordinary shares vote together as a single class on all matters submitted to a vote of the Company’s shareholders, except as required by law. Each ordinary share has one vote. At September 30, 2017 and December 31, 2016, there were 49,704,329 and 50,000,000 Class A ordinary shares outstanding, respectively, including 47,428,415 and 47,702,674 shares subject to possible redemption, and 12,500,000 Class B ordinary shares outstanding.

Preferred Shares —The Company is authorized to issue 1,000,000 preferred shares. At September 30, 2017 and December 31, 2016, no preferred shares were outstanding.


8.Stock Purchase Agreement

On August 21, 2017, the Company entered into a Stock Purchase Agreement, as amended on September 6, 2017 and November 6, 2017 and as may be further amended (the “Stock Purchase Agreement”), by and among the Company, Williams Scotsman Holdings Corp, a wholly owned subsidiary of the Company (“Holdco Acquiror”, and, together with the Company, the “Acquirors”), Algeco Scotsman Global S.à r.l. and Algeco Scotsman Holdings Kft. (together with Algeco Scotsman Global S.à r.l., the “Sellers”). Pursuant to the Stock Purchase Agreement, the Company will re-domesticate as a Delaware corporation and the Holdco Acquiror will purchase from Sellers all of the issued and outstanding shares of common stock, par value $0.01 per share, of Williams Scotsman International, Inc. (“Williams Scotsman”), resulting in Williams Scotsman becoming a wholly owned subsidiary of the Company (the “Business Combination”). In addition, the Company will domesticate as a Delaware corporation and the continuing entity will be renamed “William Scotsman Corporation” or “WSC”.

Under the Stock Purchase Agreement, the Holdco Acquiror will purchase from the Sellers, and the Sellers will sell to the Holdco Acquiror, in each case, on a pro rata basis in accordance with each Seller’s respective ownership of Williams Scotsman common stock, par value $0.01 per share (“Williams Scotsman common stock”), all of the issued and outstanding shares of Williams Scotsman common stock. The total amount payable by the Holdco Acquiror under the Stock Purchase Agreement is $1.1 billion (which amount is inclusive of the amounts required to pay third party and intercompany indebtedness as of the closing), of which (1) $1.0215 billion will be paid in cash (the “Cash Consideration”), first to repay indebtedness of Williams Scotsman as contemplated by the Stock Purchase Agreement, with the remainder to be paid directly to the Sellers as consideration for the shares, on a pro rata basis, and (2) the remaining $78.5 million will be paid to the Sellers as additional consideration for the shares, on a pro rata basis, in the form of (i) shares of common stock of the Holdco Acquiror, representing a 10% equity interest in the Holdco Acquiror (the “Holdco Shares”), which shares will be exchangeable for shares of WSC Class A common stock pursuant to an exchange agreement and (ii) a corresponding number of shares of WSC Class B common stock, representing a non-economic voting interest in WSC equal to the economic interest in WSC represented by the Holdco Shares on an as-exchanged basis (the “WSC Class B Shares” and, together with the Holdco Shares, the “Stock Consideration”). The Cash Consideration is expected to be funded from (i) gross debt financing proceeds of at least $490 million from secured debt financing commitments of $900 million in the aggregate, (ii) an equity investment by TDR Capital II Holdings L.P. (the “TDR Investor”) in an amount equal to the Closing Date Commitment (as defined below) and (iii) cash in the Company’s trust account of at least $250 million and up to $500 million.

The consummation of the business combination is conditioned upon, among other things, the Company receiving gross proceeds of at least $490 million of debt financing and an equity investment in an amount equal to the Closing Date Commitment, approval by the Company’s shareholders of the Stock Purchase Agreement, the business combination and certain other actions related thereto, the consummation of a restructuring transaction relating to Williams Scotsman pursuant to which certain assets of WSII related to the remote accommodation business in the United States and Canada (Target Logistics)loans.


NOTE 8 – Equity
Common Stock
On July 30, 2018, WillScot closed a public offering of Algeco Scotsman Global S.à r.l. (collectively with its subsidiaries, the “Algeco Group”) will be transferred to the Sellers or their affiliates (the “Carve-Out Transaction”), the availability of at least $250 million of cash in the Company’s trust account, after giving effect to redemptions of public shares, if any, the Company having at least $125 million of cash on a pro forma basis after giving effect to the consummation of the business combination and the other transactions contemplated thereby, and the receipt of consent from the existing lenders of the Sellers and certain of their affiliates. Unless waived, if any of these conditions are not satisfied, the business combination may not be consummated. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

In order to finance a portion of the Cash Consideration payable in the business combination and the costs and expenses incurred in connection therewith, (i) the Company entered into an amended equity commitment letter with the TDR Investor (the “Equity Commitment Letter”) and (ii) the Holdco Acquiror entered into an amended and restated debt commitment letter (the “Debt Commitment Letter”) with Bank of America, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated (“BofA Merrill Lynch”), Deutsche Bank AG, Canada Branch, Deutsche Bank AG Cayman Islands Branch, Deutsche Bank AG, New York Branch, Deutsche Bank Securities Inc., Morgan Stanley Senior Funding, Inc., Goldman Sachs Lending Partners LLC, Credit Suisse AG, Credit Suisse Securities (USA) LLC and ING Capital LLC (collectively, the “Commitment Parties”). Pursuant to the terms of the Equity Commitment Letter, the TDR Investor has committed to purchase, or cause the purchase of, (i)8,000,000 shares of WSCits Class A common stock at a cash purchasean offering price of $9.60$16.00 per share inshare. On August 10, 2018, the underwriters exercised their right to purchase an amount necessaryadditional 1,200,000 shares at the public offering price. The net offering proceeds, including the exercise of the over-allotment option, were $139.0 million, after deducting discount and offering expenses of $8.2 million. The Company used the proceeds to fund the Cash ConsiderationModSpace acquisition and the expenses relating to the business combination, as agreed to by the parties, after taking into account the debt financing proceedspay related fees and the trust account proceeds that are available to the Company plus (ii) up to 10 million additionalexpenses.

As disclosed in Note 2, on August 15, 2018, WillScot issued 6,458,229 unregistered shares of WSC Class A common stock at a cash purchase price of $10.00 per share, which amount of additional shares shall be dependent upon the aggregate dollar amount of redemptions at Closing (the “Closing Date Commitment”), which aggregate amount shall not exceed $500 million. In addition, following the Closing, if requested by WSC in connection with certain qualifying acquisitions, for a period of time following closing, on the terms and subject to the conditions set forth in the Equity Commitment Letter, the TDR Investor has committed to purchase, or cause the purchase of, additional shares of WSC Class A common stock at a cash purchase price of $10.00 per share in an amount equal to the difference between $500 million and the amount of the Closing Date Commitment (the “Post-Closing Commitment”), which amount, together with the Closing Date Commitment, shall not exceed $500 million. Pursuant to the terms of the Debt Commitment Letter, the Commitment Parties committed to make available to the Holdco Acquiror, at closing, a senior secured revolving credit facility in the aggregate principal amount of $600 million (the “ABL Facility”) and, to the extent the Holdco Acquiror does not receive at least $300 million of gross proceeds from the issuance of senior secured notes on the Closing Date, $300 million (minus the amount of gross proceeds from the issuance of senior secured notes on or prior to the Closing Date) aggregate principal amount of increasing rate loans (the “Bridge Loans”).

On the effective date of the domestication, the currently issued and outstanding Class B ordinary shares, par value $0.0001 per share, of Double Eagle (“Class B ordinary shares”) will automatically convert by operation of law, on a one-for-one basis, into Class A ordinary shares, par value $0.0001 per share, of Double Eagle (“Class A ordinary shares”). Immediately thereafter, the currently issued and outstanding Class A ordinary shares, will automatically convert by operation of law, on a one-for-one basis, into shares ofits Class A common stock, par value $0.0001 per share, to former ModSpace shareholders as part of WSC (“WSC Class A common stock” and togetherthe consideration paid in connection with the WSC Class B common stock, the “WSC common stock”) in accordanceModSpace acquisition. In connection with the termsissuance, WillScot entered into a registration rights agreement dated July 26, 2018, under which WillScot granted customary registration rights to the holders of the certificate of incorporation of WSCunregistered common shares. Subject to limited exception, the unregistered shares issued to former ModSpace shareholders may not be filed withsold or otherwise transferred prior to the Secretary of Statesix-month anniversary of the State of Delaware (the “Proposed Charter”).

issuance date. 

On September 6, 2017,21, 2018, the Company filed a registration statement on Form S-4 (the “Registration Statement”) with the SEC containingunder which 10,373,102 of unregistered shares of WillScot’s Class A common stock would be registered under a preliminary proxy statement/prospectusretail shelf registration statement. On November 2, 2018, the Company filed an amendment to, among other things, increase the number of registered Class A common shares available for sale by the selling shareholders from 10,373,102 to 61,865,946 shares, approximately 5.8 million of which are subject to transfer restrictions until February 15, 2019.

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Warrants
On July 10, 2018, the Company was notified that its public warrants would be delisted from the Nasdaq Capital Market (“Nasdaq”) based on the Company’s failure to satisfy a minimum holder requirement applicable to the warrants. Trading of the public warrants on Nasdaq was suspended on July 12, 2018, and they were removed from Nasdaq listing on October 8, 2018.

As disclosed in Note 2, on August 15, 2018, WillScot issued the ModSpace Warrants to the former shareholders as part of the ModSpace acquisition. Each ModSpace Warrant entitles the holder thereof to purchase one share of WillScot Class A common stock at an exercise price of $15.50 per share, subject to potential adjustment. Subject to limited exception, the ModSpace Warrants are not exercisable or transferable until the six-month anniversary of the issuance date, and the ModSpace Warrants expire on November 29, 2022. Under a registration rights agreement dated July 26, 2018, WillScot agreed to file a registration statement, and to use its reasonable best efforts to cause the registration statement to become effective, by the six-month anniversary of the issuance date.
Accumulated Other Comprehensive Loss
The changes in accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2018 and 2017 were as follows:
(in thousands)Foreign Currency Translation Adjustment
Balance at December 31, 2017 $(49,497)
Total other comprehensive loss (82)
Reclassifications to accumulated deficit(a)
(2,540)
Balance at September 30, 2018 $(52,119)

(in thousands)Foreign Currency Translation Adjustment
Balance at December 31, 2016 $(56,928)
Total other comprehensive loss 8,914 
Balance at September 30, 2017 $(48,014)
(a) In the first quarter of 2018, the Company elected to early adopt ASU 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220) - Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which resulted in a discrete reclassification of $2.5 million from accumulated other comprehensive loss to accumulated deficit effective January 1, 2018.
There were no material amounts reclassified from accumulated other comprehensive loss and into consolidated net income (loss) for the three and nine months ended September 30, 2018 and September 30, 2017.
Non-Controlling Interest
The changes in the non-controlling interest for the nine months ended September 30, 2018 were as follows:
(in thousands)Total
Balance at December 31, 2017 $48,931 
Net loss attributable to non-controlling interest (3,715)
Other comprehensive loss (26)
Issuance of common stock and contribution of proceeds to WSII 7,574 
Acquisition of ModSpace and the effect of the related financing transactions 13,614 
Balance at September 30, 2018 $66,378 
As disclosed under Common Stock above, during the three months ended September 30, 2018, WillScot issued 9,200,000 shares of Class A common stock through an underwritten public offering, the proceeds of which were immediately contributed down through WS Holdings to WSII for purposes of funding part of the ModSpace acquisition. Sapphire waived its preemptive right to participate in the public offering and pursuant to the shareholders agreement entered into by WS Holdings' shareholders, Sapphire's ownership in WS Holdings was adjusted from 10% to 9% accordingly. As disclosed in Note 2, the
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Company closed on the ModSpace Acquisition that resulted in the contribution of ModSpace's net assets of $972.4 million to WSII. The net impact of the transactions above, resulted in a non-recurring adjustment of $21.2 million to additional paid in capital and non-controlling interest on the condensed consolidated balance sheets. Despite the dilution in the non-controlling interest ownership in WS Holdings, the adjustment increases the non-controlling interest equity as a result of the significant increase in net assets from the ModSpace acquisition.

NOTE 9 – Income Taxes
The Company recorded an income tax benefit of approximately $6.5 million and $13.6 million for the three and nine months ended September 30, 2018, respectively, and $7.6 million and $17.8 million for the same periods of 2017.
The Company’s effective tax rate (“ETR”) for the three months ended September 30, 2018 and 2017 was 15.0% and 36.2%, respectively, and 23.9% and 33.3% for the nine months ended September 30, 2018 and 2017, respectively.
The Company’s estimated annual ETR ("EAETR") of 14.8% on the forecasted pre-tax loss is lower than the US statutory rate of 21.0% due to certain offsets to the overall tax benefit, namely: (1) a partial valuation allowance, $8.0 million tax expense, due to the limitation on the deductibility of interest expense estimated for the current year partially offset by reduction to the deferred tax liability, $2.3 million tax benefit, established for the book over tax basis difference for the Company's investment in its Canadian subsidiary and (2) a gross permanent disallowance, $6.6 million, of which $5.7 million relates to the non-deductibility of certain transaction costs in relation to the ModSpace acquisition.
The Company’s ETR for the three months ended September 30, 2018 of 15.0% is comparable to its EAETR due to minimal discrete items for the quarter of $0.6 million, which is primarily attributable to adjustments to deferred taxes for legislation enacted in certain state taxing jurisdictions during the quarter, notably, in New Jersey. 
The Company’s ETR for the nine months ended September 30, 2018 of 23.9% is higher than the EAETR due to $5.3 million of discrete tax benefit recorded year to date, of which a $4.3 million tax benefit is attributable to a reduction in our net state deferred tax liability in Maryland due to change in tax law enacted in the second quarter.
In addition, to the foregoing, the Company also recognized tax expense of $0.1 million and tax benefit of $0.3 million for the three and nine months ended September 30, 2018, respectively, related to foreign currency gains and losses. For the three and nine months ended September 30, 2017, the Company recognized tax expense of $1.6 million and $4.8 million, respectively, related to foreign currency gains. The Company also adjusted the provisional amounts for the impacts of the Tax Act under SAB 118 reported in its financial statements for the year ended December 31, 2017. As of September 30, 2018, a $0.6 million tax benefit has been recorded in relation to tax reform guidance under SAB 118. As noted above, the Company recorded a discrete benefit of $4.3 million in the second quarter of 2018 to reduce its net state deferred tax liability primarily related to the enactment of an apportionment rule change in Maryland.

NOTE 10 - Fair Value Measures
The fair value of financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The Company utilizes the suggested accounting guidance for the three levels of inputs that may be used to measure fair value:
Level 1 -Observable inputs such as quoted prices in active markets for identical assets or liabilities;
Level 2 -Observable inputs, other than Level 1 inputs in active markets, that are observable either directly or indirectly; and
Level 3 -Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions
The Company has assessed that the fair value of cash and cash equivalents, trade receivables, trade payables, capital lease and other financing obligations, and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
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The following table shows the carrying amounts and fair values of financial assets and liabilities, including their levels in the fair value hierarchy:
September 30, 2018December 31, 2017
Carrying AmountFair ValueCarrying AmountFair Value
(in thousands)Level 1Level 2Level 3Level 1Level 2Level 3
Financial liabilities not measured at fair value
US ABL Facility (a) $830,573 $— $857,500 $— $297,323 $— $310,000 $— 
Canadian ABL Facility (a) — — 1,549 — — — — — 
2022 Secured Notes (a) 291,853 — 310,416 — 290,687 — 310,410 — 
2023 Secured Notes (a) 293,637 — 298,185 — — — — — 
Unsecured Notes (a) 198,882 — 204,210 — — — — — 
Total $1,614,945 $— $1,671,860 $— $588,010 $— $620,410 $— 
(a) See Note 7 - Debt. 
There were no transfers of financial instruments between the three levels of the fair value hierarchy during the three and nine months ended September 30, 2018 and 2017. The fair value of the Company’s ABL Facility is primarily based upon observable market data such as market interest rates. The fair value of the Company’s 2022 Secured Notes, the 2023 Secured Notes and the Unsecured Notes is based on their last trading price at the end of each period obtained from a third party.

NOTE 11 - Restructuring
The Company incurred costs associated with restructuring plans designed to streamline operations and reduce costs of $6.1 million and $1.2 million and $7.2 million and $2.1 million net of reversals, during the three and nine months ended September 30, 2018 and 2017, respectively. The following is a summary of the activity in the Company’s restructuring accruals for the three and nine months ended September 30, 2018 and 2017:
Three Months Ended September 30, Nine Months Ended September 30, 
(in thousands)2018 2017 20182017
Balance at beginning of the period $967 $2,130 $227 $1,793 
Charges during the period6,137 1,156 7,214 2,124 
Cash payments during the period(3,661)(803)(3,991)(1,442)
Effects of movements in foreign exchange rates5 7 (2)15 
Balance at end of period $3,448 $2,490 $3,448 $2,490 
The restructuring charges for the three and nine months ended September 30, 2018 relate primarily to employee termination costs and lease exit costs in connection with the integration of Acton, Tyson, and ModSpace. As part of the restructuring plans, certain employees were required to render future service in order to receive their termination benefits. The termination costs associated with these employees was recognized over the period from the commencement of the restructuring plans to the actual date of termination. The Company anticipates that the remaining actions contemplated under the $3.4 million accrual as of September 30, 2018, will be substantially completed by the end of the third quarter of 2019.
The restructuring charges for the three and nine months ended September 30, 2017 primarily related to corporate employee termination costs incurred as part of the Algeco Group.
Segments
The $6.1 million and $1.2 million of restructuring charges for the three months ended September 30, 2018 and 2017 includes: $5.9 million and $0.3 million of charges pertaining to the Modular - US segment; $0.2 million and $0.0 million of charges pertaining to the Modular - Other North America segment; and $0.0 million and $0.9 million of charges pertaining to Corporate and other.
The  $7.2 million and  $2.1 million of restructuring charges for the nine months ended September 30, 2018 and 2017  includes: $7.0 million and $0.2 million of charges pertaining to the Modular - US segment; $0.2 million and $0.0 million of charges pertaining to the Modular - Other North America segment; and $0.0 million and $1.9 million of charges pertaining to Corporate and other.

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NOTE 12 - Stock-Based Compensation
On November 16, 2017, the Company’s shareholders approved a long-term incentive award plan (the “Plan”). The Plan is administered by the Compensation Committee of the Company’s Board of Directors. Under the Plan, the Committee may grant an aggregate of 4,000,000 shares of Class A common stock in the form of non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance compensation awards and stock bonus awards. Stock-based payments including the grant of stock options, RSUs, and RSAs are subject to service-based vesting requirements, and expense is recognized on a straight-line basis over the vesting period. Forfeitures are accounted for as they occur. During the three months ended September 30, 2018, no RSAs, RSUs or stock options were granted under the Plan. During the nine months ended September 30, 2018, 27,675 RSAs, 921,730 RSUs and 589,257 stock option awards were granted under the Plan. During the three and nine months ended September 30, 2018, 0 and 35,050 RSUs were forfeited.
Stock-based payments to employees include grants of stock options and RSUs, which are recognized in the financial statements based on their fair value.
RSUs and RSAs are valued based on the intrinsic value of the difference between the exercise price, if any, of the award and the fair market value of the Company's common stock on the grant date. RSAs vest over a one-year period and RSUs vest over a four-year period.
Stock options vest in tranches over a period of four years and expire ten years from the grant date. The fair value of each stock option award on the grant date is estimated using the Black-Scholes option-pricing model with the following assumptions: expected dividend yield, expected stock price volatility, weighted-average risk-free interest rate and weighted-average expected term of the options. The volatility assumption used in the Black-Scholes option-pricing model is based on peer group volatility as the Company does not have a sufficient trading history as a stand-alone public company. Additionally, due to an insufficient history with respect to stock option activity and post-vesting cancellations, the expected term assumption is based on the simplified method under GAAP, which is based on the vesting period and contractual term for each tranche of awards. The mid-point between the weighted-average vesting term and the expiration date is used as the expected term under this method. The risk-free interest rate used in the Black-Scholes model is based on the implied US Treasury bill yield curve at the date of grant with a remaining term equal to the Company’s expected term assumption. The Company has never declared or paid a cash dividend on common shares.
As of September 30, 2018, none of the granted RSAs, RSUs or stock options had vested.
Restricted Stock Awards
The following table summarizes the Company’s RSA activity for the nine months ended September 30, 2018:
Number of Shares Weighted-Average Grant Date Fair Value 
Balance, December 31, 2017 — $— 
Granted 27,675 13.60 
Forfeited — — 
Balance, September 30, 2018 27,675 $13.60 
Compensation expense for RSAs recognized in SG&A on the condensed consolidated statements of operations was $0.1 million and $0.2 million for the three and nine months ended September 30, 2018, respectively. At September 30, 2018, unrecognized compensation cost related to RSAs totaled $0.2 million and is expected to be recognized over the remaining six-month vesting period.

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Restricted Stock Units
The following table summarizes the Company's RSU award activity for the nine months ended September 30, 2018:
Number of SharesWeighted-Average Grant Date Fair Value
Balance, December 31, 2017 — $— 
Granted 921,730 13.60 
Forfeited (35,050)13.60 
Balance, September 30, 2018 886,680 $13.60 
Compensation expense for RSUs recognized in SG&A on the condensed consolidated statements of operations was $0.8 million and $1.6 million for the three and nine months ended September 30, 2018, respectively, with associated tax benefits of $0.2 million and $0.4 million for the three and nine months ended September 30, 2018, respectively. At September 30, 2018, unrecognized compensation cost related to RSUs totaled $10.5 million and is expected to be recognized over a remaining period of 3.5 years.
Stock Option Awards
The following table summarizes the Company's stock option activity for the nine months ended September 30, 2018:
Number of Options Weighted-Average Exercise Price per Share ($) 
Outstanding options, December 31, 2017 — $— 
Granted 589,257 $13.60 
Exercised — — 
Forfeited — — 
Outstanding options, September 30, 2018 589,257 $13.60 
Fully vested and exercisable options, end of period — $— 
Compensation expense for stock option awards, recognized in SG&A on the condensed consolidated statements of operations, was $0.2 million and $0.4 million for the three and nine months ended September 30, 2018, respectively, with associated tax benefits of $0.1 million and $0.1 million for the three and nine months ended September 30, 2018, respectively. At September 30, 2018, unrecognized compensation cost related to stock option awards totaled $2.8 million and is expected to be recognized over a remaining period of 3.5 years.
The fair value of each option award at grant date was estimated using the Black-Scholes option-pricing model with the following assumptions:
Assumptions
Expected volatility 36 %
Expected dividend yield — 
Risk-free interest rate 2.73 %
Expected term (in years) 6.25
Exercise price$13.60 
Weighted-average grant date fair value $5.51 

NOTE 13 - Commitments and Contingencies
The Company is involved in various lawsuits or claims in the ordinary course of business. Management is of the opinion that there is no pending claim or lawsuit which, if adversely determined, would have a material effect on the Company’s financial condition, results of operations or cash flows.

NOTE 14 - Segment Reporting
The Company historically has operated in two principal lines of business; modular leasing and sales and remote accommodations, which were managed separately. The Remote Accommodations Business was considered a single operating segment. As part of the Business Combination, the Remote Accommodations segment is no longer owned by the Company and is reported as discontinued operations in the condensed consolidated financial statements. As such, the segment was excluded from the segment information below.
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Modular leasing and sales is comprised of two operating segments: US and Other North America. The US modular operating segment (“Modular - US”) consists of the contiguous 48 states and Hawaii. The Other North America operating segment (“Modular - Other North America”) consists of Alaska, Canada and Mexico. Corporate and other includes eliminations of costs and revenue between segments and Algeco Group corporate costs not directly attributable to the underlying segments. Following the Business Combination, no additional Algeco Group corporate costs were incurred and the Company’s ongoing corporate costs are included within the Modular - US segment. Total assets for each reportable segment are not available because the Company utilizes a centralized approach to working capital management. Transactions between reportable segments are not significant.
As discussed in Note 6, the net assets acquired from ModSpace were allocated to both the Modular - US and Modular - Other North America segments. The US operations of ModSpace are included in the Modular - US segment and the Canadian operations of ModSpace are included in the Modular - Other North America segment. The operations and net assets acquired from Acton and Tyson are both included in the Modular - US segment.
The Company evaluates business segment performance on Adjusted EBITDA, which excludes certain items as shown in the reconciliation of the Company’s consolidated net loss before tax to Adjusted EBITDA below. Management believes that evaluating segment performance excluding such items is meaningful because it provides insight with respect to intrinsic operating results of the Company.
The Company also regularly evaluates gross profit by segment to assist in the assessment of its operational performance. The Company considers Adjusted EBITDA to be the more important metric because it more fully captures the business performance of the segments, inclusive of indirect costs.
Reportable Segments
The following tables set forth certain information regarding each of the Company’s reportable segments for the three and nine months ended September 30, 2018 and 2017, respectively:
Three Months Ended September 30, 2018 
(in thousands)Modular - US Modular - Other North America Total 
Revenues:
Leasing and services revenue:
Modular leasing$128,007 $13,653 $141,660 
Modular delivery and installation41,830 4,947 46,777 
Sales:
New units19,193 1,727 20,920 
Rental units8,595 972 9,567 
Total Revenues$197,625 $21,299 $218,924 
Costs:
Cost of leasing and services:
Modular leasing$36,204 $3,011 $39,215 
Modular delivery and installation37,782 4,608 42,390 
Cost of sales:
New units13,905 1,184 15,089 
Rental units5,025 725 5,750 
Depreciation of rental equipment31,702 3,832 35,534 
Gross profit$73,007 $7,939 $80,946 
Adjusted EBITDA$58,454 $6,164 $64,618 
Other selected data:
Selling, general and administrative expense$66,102 $5,795 $71,897 
Other depreciation and amortization$3,403 $317 $3,720 
Capital expenditures for rental fleet$43,007 $3,735 $46,742 

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Three Months Ended September 30, 2017 
(in thousands)Modular - USModular - Other North AmericaCorporate & OtherTotal
Revenues: 
Leasing and services revenue: 
Modular leasing$66,555 $8,920 $(155)$75,320 
Modular delivery and installation22,127 2,503 (3)24,627 
Sales: 
New units9,074 535 — 9,609 
Rental units5,922 765 (81)6,606 
Total Revenues$103,678 $12,723 $(239)$116,162 
Costs: 
Cost of leasing and services: 
Modular leasing$19,000 $2,252 $— $21,252 
Modular delivery and installation21,545 2,387 — 23,932 
Cost of sales: 
New units6,487 427 2 6,916 
Rental units3,204 580 — 3,784 
Depreciation of rental equipment 15,676 3,333 — 19,009 
Gross profit (loss)$37,766 $3,744 $(241)$41,269 
Adjusted EBITDA $29,177 $2,961 $(2,753)$29,385 
Other selected data: 
Selling, general and administrative expense $24,337 $4,116 $7,644 $36,097 
Other depreciation and amortization $1,298 $264 $343 $1,905 
Capital expenditures for rental fleet $24,147 $1,361 $— $25,508 

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Nine Months Ended September 30, 2018 
(in thousands)Modular - US Modular - Other North America Total 
Revenues:
Leasing and services revenue:
Modular leasing$306,920 $33,251 $340,171 
Modular delivery and installation93,190 11,250 104,440 
Sales: 
New units30,157 3,427 33,584 
Rental units14,258 1,555 15,813 
Total Revenues$444,525 $49,483 $494,008 
Costs: 
Cost of leasing and services:
Modular leasing$85,766 $7,740 $93,506 
Modular delivery and installation87,032 11,006 98,038 
Cost of sales: 
New units21,347 2,433 23,780 
Rental units8,218 1,110 9,328 
Depreciation of rental equipment 72,606 10,243 82,849 
Gross profit$169,556 $16,951 $186,507 
Adjusted EBITDA$129,170 $12,856 $142,026 
Other selected data:
Selling, general and administrative expense$150,248 $14,597 $164,845 
Other depreciation and amortization$6,962 $764 $7,726 
Capital expenditures for rental fleet$104,462 $7,043 $111,505 

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Nine Months Ended September 30, 2017 
(in thousands)Modular - USModular - Other North AmericaCorporate & OtherTotal
Revenues:
Leasing and services revenue:
Modular leasing$192,587 $25,124 $(450)$217,261 
Modular delivery and installation60,451 6,132 (3)66,580 
Sales: 
New units21,630 2,861 — 24,491 
Rental units14,634 2,675 (81)17,228 
Total Revenues$289,302 $36,792 $(534)$325,560 
Costs: 
Cost of leasing and services: 
Modular leasing$55,713 $5,981 $— $61,694 
Modular delivery and installation58,612 5,792 — 64,404 
Cost of sales: — 
New units15,172 2,240 (10)17,402 
Rental units8,240 1,827 — 10,067 
Depreciation of rental equipment 44,030 9,173 — 53,203 
Gross profit (loss)$107,535 $11,779 $(524)$118,790 
Adjusted EBITDA$79,189 $8,586 $(10,197)$77,578 
Other selected data:
Selling, general and administrative expense$72,464 $12,393 $15,653 $100,510 
Other depreciation and amortization$3,937 $755 $1,044 $5,736 
Capital expenditures for rental fleet$72,105 $3,705 $— $75,810 
The following tables present a reconciliation of the Company’s loss from continuing operations before income tax to Adjusted EBITDA by segment for the three and nine months ended September 30, 2018 and 2017, respectively:
Three Months Ended September 30, 2018 
(in thousands)Modular - USModular - Other North AmericaTotal
(Loss) income from continuing operations before income taxes $(44,519)$1,283 $(43,236)
Interest expense, net (a) 42,831 616 43,447 
Depreciation and amortization 35,105 4,149 39,254 
Currency gains, net (112)(313)(425)
Restructuring costs 5,895 242 6,137 
Integration costs 7,443 10 7,453 
Stock compensation expense 1,050 — 1,050 
Transaction costs 10,490 182 10,672 
Other (income) expense 271 (5)266 
Adjusted EBITDA $58,454 $6,164 $64,618 
(a) In connection with the ModSpace acquisition, the Company incurred bridge financing fees and upfront commitment fees of $20.5 million, included within interest expense, during the three months ended September 30, 2018.

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Three Months Ended September 30, 2017 
(in thousands)Modular - USModular - Other North AmericaCorporate & OtherTotal
Loss from continuing operations before income taxes $(1,070)$(1,684)$(18,313)$(21,067)
Interest expense, net 16,790 1,134 8,523 26,447 
Depreciation and amortization 16,974 3,597 343 20,914 
Currency gains, net (3,834)(104)(332)(4,270)
Restructuring costs 247 17 892 1,156 
Transaction costs 69 — 5,164 5,233 
Other expense 1 1 970 972 
Adjusted EBITDA $29,177 $2,961 $(2,753)$29,385 

Nine Months Ended September 30, 2018 
(in thousands)Modular - USModular - Other North AmericaTotal
Loss from continuing operations before income taxes $(55,360)$(1,397)$(56,757)
Interest expense, net (a) 65,654 1,667 67,321 
Depreciation and amortization 79,568 11,007 90,575 
Currency losses, net 159 1,012 1,171 
Restructuring costs 6,962 252 7,214 
Integration costs 14,858 10 14,868 
Stock compensation expense 2,225 — 2,225 
Transaction costs 14,539 251 14,790 
Other expense 565 54 619 
Adjusted EBITDA $129,170 $12,856 $142,026 
(a) In connection with the ModSpace acquisition, the Company incurred bridge financing fees and upfront commitment fees of $20.5 million, included within interest expense, during the nine months ended September 30, 2018.

Nine Months Ended September 30, 2017 
(in thousands)Modular - USModular - Other North AmericaCorporate & OtherTotal
Loss from continuing operations before income taxes $(6,280)$(4,142)$(42,903)$(53,325)
Interest expense, net 48,302 3,350 23,270 74,922 
Depreciation and amortization 47,967 9,928 1,044 58,939 
Currency gains, net (11,233)(585)(951)(12,769)
Restructuring costs 247 17 1,860 2,124 
Transaction costs 115 — 5,980 6,095 
Other expense 71 18 1,503 1,592 
Adjusted EBITDA $79,189 $8,586 $(10,197)$77,578 


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NOTE 15 - Income (Loss) Per Share
Basic income (loss) per share (“EPS”) is calculated by dividing net income (loss) attributable to WillScot by the weighted average number of its Class A common shares outstanding during the period. Concurrently with the Business Combination, 12,425,000 of WillScot's Class A common shares were placed into escrow by shareholders and became ineligible to vote or participate in the economic rewards available to the other Class A shareholders. Escrowed shares were therefore excluded from the EPS calculation while deposited in the escrow account. 6,212,500 of the escrowed shares were released to shareholders on January 19, 2018, and the remaining escrowed shares were released to shareholders on August 21, 2018.
WillScot's Class B common shares have no rights to dividends or distributions made by the Company and, in turn, are excluded from the EPS calculation.
Diluted EPS is computed similarly to basic net income (loss) per share, except that it includes the potential dilution that could occur if dilutive securities were exercised. Effects of potentially dilutive securities are presented only in periods in which they are dilutive. Stock options, restricted stock units and restricted stock awards, representing 589,257, 886,680 and 27,675 shares of Class A common stock outstanding for the three and nine months ended September 30, 2018, were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive. Warrants representing 44,750,000 shares of Class A shares for the three and nine months ended September 30, 2018, were excluded from the computation of diluted earnings per share because their effect would have been anti-dilutive.
Pursuant to the exchange agreement entered into by WS Holding's shareholders, Sapphire has the right, but not the obligation, to exchange all, but not less than all, of its shares of WS Holdings into newly issued shares of WillScot’s Class A common stock in a private placement transaction. The impact of this exchange has been excluded from the computation of diluted earnings per share because the effect would have been anti-dilutive.

NOTE 16 - Related Parties
Related party balances included in the Company’s consolidated balance sheet at September 30, 2018 and December 31, 2017, consisted of the following:
(in thousands)Financial statement line Item September 30, 2018December 31, 2017
Receivables due from affiliates Prepaid expenses and other current assets $66 $2,863 
Amounts due to affiliates Accrued liabilities (1,465)(1,235)
Total related party liabilities, net $(1,399)$1,628 
On November 29, 2017, in connection with the closing of the Business Combination, the Company, WSII, WS Holdings and Algeco Global entered into a transition services agreement (the “TSA”). The purpose of the TSA is to ensure an orderly transition of WSII’s business and effectuate the Business Combination. Pursuant to the TSA, each party will provide or cause to be provided to the other party or its affiliates certain services, use of facilities and other assistance on a transitional basis. The services period under the TSA ranges from six months to three years based on the services, but includes early termination clauses. The Company had $0.2 million in accruals and $2.9 million in receivables due from affiliates pertaining to the Transition Services Agreement at September 30, 2018 and December 31, 2017, respectively.
The Company accrued expenses of $0.5 million and $1.2 million at September 30, 2018 and December 31, 2017, respectively, included in amounts due to affiliates, related to rental equipment purchases from an entity within the Algeco Group.
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Related party transactions included in the Company’s consolidated statement of operations for the three and nine months ended September 30, 2018 and 2017, respectively, consisted of the following:
Three Months Ended September 30, Nine Months Ended September 30, 
(in thousands)Financial statement line item 2018201720182017
Leasing revenue from related parties Modular leasing revenue $(104)$— $(629)$— 
Rental unit sales to related parties Rental unit sales (1,548)— (1,548)— 
Management fees and recharge income on transactions with affiliates Selling, general & administrative expenses — (1,693)— (1,542)
Interest income on notes due from affiliates Interest income — (3,659)— (9,752)
Interest expense on notes due to affiliates Interest expense — 17,191 — 47,918 
Remote accommodations revenue and costs, net from affiliates Income from discontinued operations, net of tax — 1,327 — 1,327 
Total related party (income) expense, net $(1,652)$13,166 $(2,177)$37,951 
On August 22, 2018, WillScot’s majority stockholder, Sapphire, entered into a margin loan (the "Margin Loan ") under which all of its WillScot Class A common stock was pledged to secure $125.0 of borrowings under the loan agreement. WillScot is not a party to the loan agreement and has no obligations thereunder, but WillScot delivered an issuer agreement to the lenders under which WillScot has agreed to certain obligations relating to the Stock Purchase Agreementshares pledged by Sapphire and, subject to applicable law and stock exchange rules, not to take any actions that are intended to materially hinder or delay the exercise of any remedies with respect to the pledged shares. In connection with the Margin Loan, on August 24, 2018, WSII entered into a two-year supply agreement with Target Logistics, an affiliate controlled by Sapphire, under which, subject to limited exception, WSII acquired the exclusive right to supply modular units, portable storage units, and other ancillary products ordered by the affiliate in the United States. WillScot's leasing revenue and rental unit sales associated with Target Logistics for the three and nine months ended September 30, 2018 are disclosed above. As of September 30, 2018, the 49,041,906 shares of WillScot Class A common stock pledged by Sapphire represented approximately 48.9% of WillScot’s issued and outstanding Class A shares.
The Company had capital expenditures of rental equipment purchased from related party affiliates of $1.2 million and $0.5 million for three months ended September 30, 2018 and 2017, respectively, and $3.0 million and $1.0 million during the nine months ended September 30, 2018 and 2017, respectively.
The Company paid $0.1 million and $0.2 million in professional fees to an entity, that two of the Company’s Directors also served in the same role for that entity, during the three months ended September 30, 2018 and 2017, respectively, and $1.1 million and $0.8 million during the nine months ended September 30, 2018 and 2017, respectively.

NOTE 17 - Subsequent Events
On November 6, 2018, WSII entered into an interest rate swap transaction with a financial counterparty that effectively converts $400.0 million in aggregate notional amount of its variable-rate debt into fixed-rate debt. The fixed rate paid by WSII is 3.06% and the shareholder approval requiredvariable rate received resets monthly to a one-month LIBOR rate. The swap transaction, which matures on May 29, 2022, was consummated to mitigate the interest rate risk inherent in WSII’s floating-rate credit agreement, which also matures on May 29, 2022, and not for trading or speculative purposes. The master agreement that governs the interest rate swap contains customary representations, warranties and covenants and may be sought fromterminated prior to its expiration.
On November 8, 2018, WillScot announced the shareholderscommencement of an offer to each holder of its public and private warrants to purchase one-half share of Class A common stock, par value of $0.0001 per share, of WillScot for a purchase price of $5.75 (the “Warrants”) to receive 0.1818 common shares in exchange for each Warrant tendered by the holder and exchanged pursuant to the offer (the “Offer”). The warrants issued in connection with the Company's acquisition of ModSpace, each of which is exercisable for one share of WillScot Class A common stock at an exercise price of $15.50 per share, are not subject to the Offer. The Offer is made solely upon the terms and conditions in a Prospectus/Offer to Exchange and other related offering materials that are being distributed to holders of the Company.Warrants. The Registration Statement was declared effectiveOffer will be open until 11:59 p.m., Eastern Standard Time, on November 7, 2017 (See Note 9).

9.Subsequent Events

SubsequentDecember 6, 2018, or such later time and date to September 30, 2017, on November 7, 2017, the Registration Statement was declared effective by the SEC.

which WillScot may extend.


35


Item

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

ReferencesOperations

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help the reader understand WillScot Corporation (“WillScot” or the “Company”), our operations and our present business environment. MD&A is provided as a supplement to, and should be read in conjunction with, our financial statements and the accompanying notes thereto, contained in Part I, Item 1 of this report.
On November 29, 2017, the Company, through its subsidiary, Williams Scotsman Holdings Corp. (“WS Holdings”), acquired all of the equity interest of Williams Scotsman International, Inc. (“WSII”) via a reverse recapitalization (the “Business Combination”). As a result of the Business Combination, (i) WillScot’s consolidated financial results for periods prior to November 29, 2017 reflect the financial results of WSII and its consolidated subsidiaries, as the accounting predecessor to WillScot, and (ii) for periods from and after this date, WillScot’s financial results reflect those of WillScot and its consolidated subsidiaries (including WSII and its subsidiaries) as the successor following the Business Combination.
Prior to the “Company,completion of the Business Combination, WSII also provided full-service remote workforce accommodation solutions in their remote accommodations business, which consisted of Target Logistics Management LLC (“Target Logistics”) and its subsidiaries and Chard Camp Catering Services (“Chard,” “our,” “us”and together with Target Logistics, the “Remote Accommodations Business”). A parent company of WSII’s former owners, Algeco Scotsman Global S.à r.l., (together with its subsidiaries, the “Algeco Group”), undertook an internal restructuring (the “Carve-Out Transaction”) whereby certain assets related to WSII’s historical Remote Accommodations Business were transferred from WSII to other entities owned by the Algeco Group. This Remote Accommodations Business segment in its entirety is presented as discontinued operations in the condensed consolidated financial statements.
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all the information and notes required by accounting principles generally accepted in the US (“GAAP”) for complete financial statements. We use certain non-GAAP financial information that we believe is important for purposes of comparison to prior periods and development of future projections and earnings growth prospects. This information is also used by management to measure the profitability of our ongoing operations and analyze our business performance and trends. Reconciliations of non-GAAP measures are provided in this section where presented.

Executive Summary and Outlook
We are the leading provider of modular space and portable storage solutions in the United States (“US”), Canada and Mexico. In the third quarter of 2018, we completed the acquisition of Modular Space Holdings, Inc. (“ModSpace”) for a total purchase price of approximately $1.2 billion. With the addition of ModSpace, as of September 30, 2018, our branch network included over 120 locations and additional storage lots to service more than 50,000 customers across the US, Canada and Mexico. We offer our customers an extensive selection of “Ready to Work” modular space and portable storage solutions and now manage a fleet of over 132,000 modular space units and over 26,000 portable storage units. We remain focused on our core priorities of growing modular leasing revenues by increasing modular space units on rent, both organically and through our consolidation strategy, delivering “Ready to Work” solutions to our customers with value-added products and services (“VAPS”), and on continually improving the overall customer experience.
Subsequent to the close of the ModSpace transaction on August 15, 2018, we began the process to integrate ModSpace's operations into our organizational structure, branch footprint, shared services and information technology platform. These efforts are well underway and effective November 1, 2018, our combined sales organization began writing all new contracts (including those associated with legacy ModSpace assets) from WillScot's operating and information technology platform. We anticipate full information technology cut-over from the ModSpace systems in the first quarter of 2019 and will continue our integration efforts around real estate consolidation and fleet relocation on both the Acton Mobile ("Acton") and ModSpace acquisitions.  
Before announcing the ModSpace acquisition, we secured debt commitments from several financial institutions to fund the acquisition. In the third quarter, we entered into or “we” referamended several agreements to Double Eagle Acquisition Corp. fund the cash consideration paid in the acquisition on a permanent basis and to pay related fees and expenses. In particular we:
• upsized our senior secured revolving credit facility (the "ABL Facility") to $1.425 billion (expandable to $1.8 billion through an accordion feature) and obtained the amendments required to finance the acquisition and to give effect to our greater scale thereafter;
• completed a $300.0 million private placement of 6.875% senior secured notes due 2023 (the "2023 Secured Notes");
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• completed a $200.0 million private placement of senior unsecured notes due 2023 (the "Unsecured Notes"); and
• raised $147.2 million of gross proceeds from an underwritten common stock offering.
For the three months ended September 30, 2018, key drivers of financial performance include:
• Increased total revenues by $102.7 million, or 88.4% as compared to the same period in 2017, driven by a 88.4% increase in our core leasing and services revenues from both organic growth, and due to the impact of the Acton, Tyson, and ModSpace acquisitions discussed in Note 2 of our unaudited condensed consolidated financial statements. New and rental unit sales increased 117.7% and 45.5%, respectively, also driven by acquisitions. 
• On a pro-forma basis, including results of WillScot, Acton, Tyson, and ModSpace for all periods presented, total revenues increased $30.4 million, or 11.3%, driven by increases in core leasing revenues as a result of rate improvements and due to increased new sales.
• Increased the Modular - US segment revenues which represents 90.3% of revenue for the three months ended September 30, 2018, by $93.9 million, or 90.5%, as compared to the same period in 2017, through:
- Average modular space monthly rental rate growth of 3.1% to $559 including the impacts of acquisitions primarily through increases in the price of our units. Organic increases on unit pricing and VAPS pricing and penetration on the Williams Scotsman legacy fleet were partially offset by lower rates on units acquired from Acton and Tyson and to a lesser extent, ModSpace, and by lower VAPS pricing and penetration on all acquired fleet; and
- Increased average modular space units on rent by 31,795 units, or 87.9%, due to of the Acton, Tyson, and ModSpace acquisitions; and
- Average modular space monthly utilization increased 160 basis points (“bps”) to 73.8% for the three months ended September 30, 2018 as compared to the three months ended June 30, 2018. This increase was driven by higher utilization on the acquired ModSpace fleet as compared to the overall average including fleet acquired from Acton and Tyson. However, utilization decreased by 90 bps during the quarter as compared to the three months ended September 30, 2017, as a result of lower utilization on acquired fleet from Acton and Tyson; and
- On a pro-forma basis, including results of WillScot, Acton, and ModSpace for all periods presented, average modular space monthly rental rate increased 13.4% on consistent average modular space units on rent.
• Increased the Modular - Other North America segment revenues which represented 9.7% of revenues for the three months ended September 30, 2018, by $8.6 million, or 67.7% as compared to the same period in 2017. Increases were driven primarily by:
- Average modular space monthly rental rate increased 9.5% to $587; and 
- Average modular space units on rent increased by 2,154 units, or 40.8% as compared to the same period in 2017 driven primarily by acquired units from the ModSpace transaction, as well as organic increases at Williams Scotsman; and 
- Average modular space monthly utilization increased by 320 bps as compared to the same period in 2017 to 57.3%, and increased 20 bps as compared to the three months ended June 30, 2018.
- On a pro-forma basis, including results of WillScot and ModSpace for all periods presented, Modular - Other North America segment modular space units on rent decreased 3.6%, however average modular space monthly rental rate increased 0.9%.
• Generated Adjusted EBITDA of $58.5 million and $6.2 million for the Modular - US Segment and the Modular - Other North America Segment, respectively, for combined Adjusted EBITDA of $64.6 million between the Modular - US Segment and the Modular - Other North America Segment, representing an increase of $32.4 million or 100.6% as compared to the same period in 2017, which includes the impact of the Acton, Tyson, and ModSpace acquisitions discussed in Note 2 of the unaudited condensed consolidated financial statements.
Our customers operate in a diversified set of end markets, including commercial and industrial, construction, education, energy and natural resources, government and other end-markets. We track several market leading indicators including those related to our two largest end markets, the commercial and industrial segment and the construction segment, which collectively accounted for approximately 80% of our revenues in the three months ended September 30, 2018, including the customer base from the Acton, Tyson, and ModSpace acquisitions. Market fundamentals underlying these markets remain favorable, and we expect continued modest market growth in the next several years. Potential increased capital spending as a result tax reform, discussions of increased infrastructure spending, and rebuilding in areas impacted by natural disasters in 2017 and 2018 across the US also provide us confidence in continued demand for our products.
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Although only 9.7% of our revenues for the three months ended September 30, 2018 were from the Modular - Other North America segment, markets in Canada, including Alaska, and Mexico, show continued improvement despite declines experienced over the last several years related to the energy markets. Improvement in average modular space monthly rental rates, average modular space units on rent, and average modular space monthly utilization continued in the third quarter as compared to the same period in 2017. However, competitive pressures in these markets may continue to depress pricing given current levels of supply in the market until utilization across the industry improves.

Consolidated Results of Operations
Three Months Ended September 30, 2018 Compared to the Three Months Ended September 30, 2017 
Our consolidated statements of operations for the three months ended September 30, 2018 and 2017 are presented below:
Three Months Ended September 30, 2018 vs. 2017 $ Change
(in thousands)20182017
Revenues: 
Leasing and services revenue: 
Modular leasing $141,660 $75,320 $66,340 
Modular delivery and installation 46,777 24,627 22,150 
Sales: 
New units 20,920 9,609 11,311 
Rental units 9,567 6,606 2,961 
Total revenues 218,924 116,162 102,762 
Costs: 
Costs of leasing and services: 
Modular leasing 39,215 21,252 17,963 
Modular delivery and installation 42,390 23,932 18,458 
Costs of sales: 
New units 15,089 6,916 8,173 
Rental units 5,750 3,784 1,966 
Depreciation of rental equipment 35,534 19,009 16,525 
Gross profit 80,946 41,269 39,677 
Expenses: 
Selling, general and administrative 71,897 36,097 35,800 
Other depreciation and amortization 3,720 1,905 1,815 
Restructuring costs 6,137 1,156 4,981 
Currency gains, net (425)(4,270)3,845 
Other (income) expense, net (594)1,001 (1,595)
Operating income 211 5,380 (5,169)
Interest expense 43,447 30,106 13,341 
Interest income — (3,659)3,659 
Loss from continuing operations before income tax (43,236)(21,067)(22,169)
Income tax benefit (6,507)(7,632)1,125 
Loss from continuing operations (36,729)(13,435)(23,294)
Income from discontinued operations, net of tax — 5,078 (5,078)
Net loss (36,729)(8,357)(28,372)
Net loss attributable to non-controlling interest, net of tax (3,210)— (3,210)
Total loss attributable to WillScot $(33,519)$(8,357)$(25,162)
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Comparison of Three Months Ended September 30, 2018 and 2017
Revenue: Total revenue increased $102.7 million, or 88.4%, to $218.9 million for the three months ended September 30, 2018 from $116.2 million for the three months ended September 30, 2017. The increase was primarily the result of a 88.4% increase in leasing and services revenue driven by improved pricing and volumes. Average modular space monthly rental rates increased 3.7% to $561 for the three months ended September 30, 2018, and average modular space units on rent increased 33,949 units, or 81.9%. Improved pricing was driven by a combination of our price optimization tools and processes, as well as by continued growth in our “Ready to Work” solutions and increased VAPS penetration across our customer base, offset partially by the average modular space monthly rental rates on acquired units for Acton, Tyson, and ModSpace. Improved volumes were driven by units acquired as part of the Acton, Tyson, and ModSpace acquisitions, as well as increased modular delivery and installation revenues on the combined rental fleet of 90.2%. The increase in leasing and services revenue was further complemented by increases of $11.3 million, or 117.7%, and $3.0 million, or 45.5% on new unit and rental unit sales, respectively, as compared to the same period in 2017. The increase year over year in new sales was primarily driven by a single large sale project within the US. Increases in rental unit sales was primarily a result of the ModSpace acquisition and our larger post-acquisition fleet size.
On a pro-forma basis, including results of WillScot, Acton, Tyson, and ModSpace for all periods presented, total revenues increased $30.4 million, or 11.3%, year-over-year for the three months ended September 30, 2018. Increases were driven by core leasing and services revenues as a result of a 12.0% increase in average modular space monthly rental rates, and due to increased new sales.
Total average units on rent for the three months ended September 30, 2018 and 2017 were 91,194 and 53,705, respectively. The increase was due to units acquired as part of the Acton, Tyson, and ModSpace acquisitions, with modular space average units on rent increasing by 33,949 units, or 81.9% for the three months ended September 30, 2018. Modular space average monthly rental rates increased 3.7% for the three months ended September 30, 2018. Portable storage average units on rent increased by 3,540 units, or 28.9% for the three months ended September 30, 2018. Average portable storage monthly rental rates increased 2.6% for the three months ended September 30, 2018. The average modular space unit utilization rate during the three months ended September 30, 2018 was 71.8%, as compared to 71.3% during the same period in 2017. The increase in average modular space utilization rate was driven by improvement in the modular space average units on rent in the Modular - Other North America business segment, slightly offset by declines in the Modular - US business segment as a result of acquired units at lower utilization rates. The average portable storage unit utilization rate during the three months ended September 30, 2018 was 68.0%, as compared to 69.8% during the same period in 2017. The decrease in average portable storage utilization rate was driven by organic declines in the number of portable storage average units on rent in the Modular - US segment.
Gross Profit: Our gross profit percentage was 37.0% and 35.5% for the three months ended September 30, 2018 and 2017, respectively. Our gross profit percentage, excluding the effects of depreciation, was 53.0% and 52.0% for the three months ended September 30, 2018 and 2017, respectively.
Gross profit increased $39.6 million, or 95.9%, to $80.9 million for the three months ended September 30, 2018 from $41.3 million for the three months ended September 30, 2017. The increase in gross profit is a result of a $52.0 million increase in modular leasing and services gross profit and increased new unit and rental unit gross profit of $4.1 million. Increases in modular leasing and services gross profit were primarily as a result of increased revenues due to additional units on rent as a result of recent acquisitions as well as increased margins due to favorable average monthly rental rates on modular space units. These increases were partially offset by increased depreciation of $16.5 million as a result of additional rental equipment acquired as part of the Acton, Tyson, and ModSpace acquisitions, as well as continued capital investment in our existing rental equipment.
Selling, General and Administrative: Selling, general and administrative expense (“SG&A”) increased $35.8 million, or 99.2%, to $71.9 million for the three months ended September 30, 2018, compared to $36.1 million for the three months ended September 30, 2017. $13.9 million of the SG&A increase was driven by discrete items including increased transaction costs of $5.4 million related to the ModSpace acquisition and increased integration costs of $7.5 million related to the Acton and ModSpace integrations. Additionally, stock compensation expense increased $1.1 million due to grants of stock options, restricted stock awards (“RSAs”) and restricted stock units (“RSUs”) to certain employees in the first quarter of 2018. The remaining increases of $21.9 million are primarily related to $2.4 million of public company costs including outside professional fees, and increased headcount, occupancy, and other SG&A cost increases as a result of operating a larger operation as a result of our recent acquisitions and our expanded employee base and branch network. Cost synergies of approximately $2.4 million related to the Acton and Tyson acquisitions were realized during the quarter and our integration plans remain on track. Effective November 1, 2018, our combined sales organization began writing all new contracts (including those associated with legacy ModSpace assets) from WillScot's operating and information technology platform. Exit activities for redundant branch locations, such as preparing units and materials for transport to other locations remain on schedule. These activities are expected to continue through 2019 and we expect additional cost savings as we execute the established integration plans for Acton and ModSpace. These increases were partially offset by a reduction of $7.6 million in corporate & other related to Algeco Group costs no longer included in our operations.

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Other Depreciation and Amortization: Other depreciation and amortization increased $1.8 million, or 94.7%, to $3.7 million for the three months ended September 30, 2018, compared to $1.9 million for the three months ended September 30, 2017.  The increase was driven primarily by depreciation on property, plant and equipment acquired as part of the Acton and ModSpace acquisitions in the first and third quarters, respectively.
Restructuring Costs: Restructuring costs were $6.1 million for the three months ended September 30, 2018 as compared to $1.2 million for the three months ended September 30, 2017. The 2018 restructuring charges relate primarily to employee termination and lease breakage costs related to the Acton and ModSpace acquisitions and integrations. The 2017 restructuring charges relate primarily to the Algeco Group corporate function and consist of employee termination costs.
Currency Losses (Gains), net: Currency losses (gains), net decreased by $3.9 million to a $0.4 million gain for the three months ended September 30, 2018 compared to a $4.3 million gain for the three months ended September 30, 2017. The decrease in currency losses (gains) was primarily attributable to the impact of foreign currency exchange rate changes on loans and borrowings and intercompany receivables and payables denominated in a currency other than the subsidiaries’ functional currency. The majority of the intercompany receivables and payables contributing to these gains and losses were settled concurrently with the Carve-Out Transaction and Business Combination in November 2017.
Other (Income) Expense, Net: Other (income) expense, net was $0.6 million of other income for the three months ended September 30, 2018 and $1.0 million of other expense for the three months ended September 30, 2017. The increase in other income was driven by the receipt of a settlement which contributed $0.8 million to other (income) expense, net, for the three months ended September 30, 2018.
Interest Expense: Interest expense increased $13.3 million, or 44.2%, to $43.4 million for the three months ended September 30, 2018 from $30.1 million for the three months ended September 30, 2017. Upon consummation of the Business Combination in November 2017, we issued $300.0 million of 7.875% senior secured notes (the “2022 Secured Notes”) and entered into a new $600.0 million ABL Facility to fund our operations as a stand-alone company. In the third quarter of 2018, as part of financing the ModSpace acquisition, we upsized our ABL Facility to $1.425 billion, issued $300.0 million related to the 2023 Secured Notes, and issued $200.0 million related to the Unsecured Notes. In connection with the ModSpace acquisition, the Company incurred bridge financing fees and upfront commitment fees of $20.5 million in the third quarter, which are not expected to reoccur.
The majority of the interest costs incurred during the three months ended September 30, 2017 relate to the previous debt structure of the Company as part of the Algeco Group. The increase in interest expense is driven by our recent debt issuances including the $20.5 million of bridge financing fees and upfront commitment fees. See Note 7 to the condensed consolidated financial statements for further discussion of our debt, and the additional debt incurred during the third quarter as part of financing the ModSpace acquisition.
Interest Income: Interest income related to the interest earned on the principal balance of notes due from affiliates, which were settled upon consummation of the Business Combination in November 2017.
Income Tax Benefit: Income tax benefit decreased $1.1 million to $6.5 million for the three months ended September 30, 2018 compared to $7.6 million for the three months ended September 30, 2017. The decrease in income tax benefit was mainly due to a lower statutory income tax rate in the US partially offset by discrete tax benefits recorded at September 30, 2018 as compared to September 30, 2017. 

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Nine Months Ended September 30, 2018 Compared to the Nine Months Ended September 30, 2017 
Our consolidated statements of net loss for the nine months ended September 30, 2018 and 2017 are presented below:
Nine Months Ended September 30, 2018 vs. 2017 $ Change
(in thousands)20182017
Revenues: 
Leasing and services revenue: 
Modular leasing $340,171 $217,261 $122,910 
Modular delivery and installation 104,440 66,580 37,860 
Sales: 
New units 33,584 24,491 9,093 
Rental units 15,813 17,228 (1,415)
Total revenues 494,008 325,560 168,448 
Costs: 
Costs of leasing and services: 
Modular leasing 93,506 61,694 31,812 
Modular delivery and installation 98,038 64,404 33,634 
Costs of sales: 
New units 23,780 17,402 6,378 
Rental units 9,328 10,067 (739)
Depreciation of rental equipment 82,849 53,203 29,646 
Gross profit 186,507 118,790 67,717 
Expenses: 
Selling, general and administrative 164,845 100,510 64,335 
Other depreciation and amortization 7,726 5,736 1,990 
Restructuring costs 7,214 2,124 5,090 
Currency losses (gains), net 1,171 (12,769)13,940 
Other (income) expense, net (5,013)1,592 (6,605)
Operating income 10,564 21,597 (11,033)
Interest expense 67,321 84,674 (17,353)
Interest income — (9,752)9,752 
Loss from continuing operations before income tax (56,757)(53,325)(3,432)
Income tax benefit (13,572)(17,770)4,198 
Loss from continuing operations(43,185)(35,555)(7,630)
Income from discontinued operations, net of tax — 11,123 (11,123)
Net loss(43,185)(24,432)(18,753)
Net loss attributable to non-controlling interest, net of tax(3,715)— (3,715)
Total loss attributable to WillScot $(39,470)$(24,432)$(15,038)
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Comparison of Nine Months Ended September 30, 2018 and 2017
Revenue: Total revenue increased $168.4 million, or 51.7%, to $494.0 million for the nine months ended September 30, 2018 from $325.6 million for the nine months ended September 30, 2017. The increase was primarily the result of a 56.4% increase in leasing and services revenue driven by improved pricing and volumes. Average modular space monthly rental rates increased 4.7% for the nine months ended September 30, 2018, and average modular space units on rent increased 20,047 units, or 49.3%. Improved pricing was driven by a combination of our price optimization tools and processes, as well as by continued growth in our “Ready to Work” solutions and increased VAPS penetration across our customer base, offset partially by the average modular space monthly rental rates on acquired units for Acton, Tyson, and ModSpace. Improved volumes were driven by units acquired as part of the Acton, Tyson, and ModSpace acquisitions and organic unit on rent growth, as well as increased modular delivery and installation revenues on the combined rental fleet of 56.8%. The increase in leasing and services revenues was further complemented by an increase of $9.1 million, or 37.1% in new unit sales as compared to the same period in 2017 primarily driven by a single large sale project in the third quarter within the US. These increases were partially offset by a reduction in rental unit sales of $1.4 million, or 8.1% in rental unit sales as compared to the same period in 2017.
On a pro-forma basis, including results of WillScot, Acton, Tyson, and ModSpace for all periods presented, total revenues increased $67.3 million, or 9.1%, year-over-year for the nine months ended September 30, 2018. Increases were driven by core leasing and services revenues as a result a of a 10.6% increase in average modular space monthly rental rates and a 0.7% increase in average modular space units of rent, and due to increased new sales.
Total average units on rent for the nine months ended September 30, 2018 and 2017 were 75,079 and 53,279, respectively. The increase was due to units acquired as part of the Acton, Tyson, and ModSpace acquisitions and organic improvements in modular space average units on rent, with modular space average units on rent increased by 20,047 units, or 49.3% for the nine months ended September 30, 2018. Modular space average monthly rental rates increased 4.7% for the nine months ended September 30, 2018. Portable storage average units on rent increasing by 1,753 units, or 13.9% for the nine months ended September 30, 2018. Average portable storage monthly rental rates increased 7.9% for the nine months ended September 30, 2018. The average modular space unit utilization rate during the nine months ended September 30, 2018 was 70.1%, as compared to 69.8% during the same period in 2017. The increase in average modular space utilization rate was driven by improvement in the modular space average units on rent in the Modular - Other North America business segment. The average portable storage unit utilization rate during the nine months ended September 30, 2018 was 68.3%, as compared to 71.4% during the same period in 2017. The decrease in average portable storage utilization rate was driven by organic declines in the number of portable storage average units on rent in the Modular - US segment.
Gross Profit: Our gross profit percentage was 38.8% and 36.4% for the nine months ended September 30, 2018 and 2017, respectively. Our gross profit percentage, excluding the effects of depreciation, was 55.0% and 53.0% for the nine months ended September 30, 2018 and 2017, respectively.
Gross profit increased $67.7 million, or 57.0%, to $186.5 million for the nine months ended September 30, 2018 from $118.8 million for the nine months ended September 30, 2017. The increase in gross profit is a result of a $95.3 million increase in modular leasing gross profit and increased new unit and rental unit gross profit of $2.0 million. Increases in modular leasing and services gross profit were primarily as a result of increased revenues due to additional units on rent as a result of recent acquisitions as well as increased margins due to favorable average monthly rental rates on modular space units. These increases were partially offset by increased depreciation of $29.6 million as a result of additional rental equipment acquired as part of the Acton, Tyson, and ModSpace acquisitions, as well as continued capital investment in our existing rental equipment.
Selling, General and Administrative: SG&A expenses increased $64.3 million, or 64.0%, to $164.8 million for the nine months ended September 30, 2018, compared to $100.5 million for the nine months ended September 30, 2017. $25.8 million of the SG&A expenses increase was driven by discrete items including increased transaction costs of $8.7 million related to the ModSpace acquisition and increased integration costs of $14.9 million related to the Acton and ModSpace integrations. Additionally, stock compensation expense increased by $2.2 million due to grants of stock options, RSAs and RSUs to certain employees in the first quarter of 2018. The remaining increases of $38.5 million are primarily related to $8.6 million of increased public company costs including outside professional fees, and increased headcount, occupancy, and other SG&A cost increases as a result of operating a larger operation as a result of our recent acquisitions and our expanded employee base and branch network. We estimate cost synergies of approximately $3.9 million related to the Acton and Tyson acquisitions have been realized year to date as of the third quarter and our integration plans remain on track. Effective November 1, 2018, we began delivering all units acquired from ModSpace under a combined operating and information technology platform. Exit activities for redundant branch locations, such as preparing units and materials for transport to other locations remain on schedule. These activities are expected to continue through 2019 and we expect additional cost savings as we execute the established integration plans for Acton and ModSpace. These increases were partially offset by a reduction of $15.7 million in corporate & other related to Algeco Group costs no longer included in our operations. 
Other Depreciation and Amortization: Other depreciation and amortization increased $2.0 million, or 35.1%, to $7.7 million for the nine months ended September 30, 2018, compared to $5.7 million for the nine months ended September 30, 2017. The increase was driven primarily by depreciation on property, plant and equipment acquired as part of the Acton
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and ModSpace acquisitions in the first and third quarters, respectively.
Restructuring Costs: Restructuring costs were $7.2 million for the nine months ended September 30, 2018 as compared to $2.1 million for the nine months ended September 30, 2017. The 2018 restructuring charges relate primarily to employee termination and lease breakage costs related to the Acton and ModSpace acquisitions and integrations. The 2017 restructuring charges relate primarily to the Algeco Group corporate function and consist of employee termination costs.
Currency Losses (Gains), net: Currency losses (gains), net decreased by $14.0 million to a $1.2 million loss for the nine months ended September 30, 2018 compared to a $12.8 million gain for the nine months ended September 30, 2017. The decrease in currency losses (gains) was primarily attributable to the impact of foreign currency exchange rate changes on loans and borrowings and intercompany receivables and payables denominated in a currency other than the subsidiaries’ functional currency. The majority of the intercompany receivables and payables contributing to these gains and losses were settled concurrently with the Carve-Out Transaction and Business Combination.
Other (Income) Expense, net: Other (income) expense, net was $5.0 million of income for the nine months ended September 30, 2018 and $1.6 million of other expense for the nine months ended September 30, 2017. The decrease in other (income) expense was driven by income from insurance proceeds related to assets damaged during Hurricane Harvey which contributed $4.8 million to other (income) expense, net, for the nine months ended September 30, 2018.
Interest Expense: Interest expense decreased $17.4 million, or 20.5%, to $67.3 million for the nine months ended September 30, 2018 from $84.7 million for the nine months ended September 30, 2017. Upon consummation of the Business Combination in November 2017, we issued the 2022 Secured Notes and entered into the ABL Facility to fund our operations as a stand-alone company. In the third quarter as part of financing the ModSpace acquisition, we upsized our ABL Facility to $1.425 billion, issued the 2023 Secured Notes, and issued the Unsecured Notes. In connection with the ModSpace acquisition, the Company incurred bridge financing fees and upfront commitment fees of $20.5 million in the third quarter, which are not expected to reoccur.
The majority of the interest costs incurred during the nine months ended September 30, 2017 relate to the previous debt structure of the Company as part of the Algeco Group. The decrease in interest expense is driven by our lower average debt balance in 2018 under our new debt structure as compared to the Algeco Group debt structure in place in 2017, partially offset by bridge financing and upfront commitment fees of $20.5 million incurred in connection with the ModSpace acquisition. See Note 7 to the condensed consolidated financial statements for further discussion of our debt, and the additional debt incurred during the third quarter as part of financing the ModSpace acquisition, which we expect will increase our interest expense in future periods.
Interest Income: Interest income decreased $9.8 million, or 100.0%, to zero for the nine months ended September 30, 2018 from $9.8 million for the nine months ended September 30, 2017. This decrease is due to the decrease in the principal balance of notes due from affiliates, which were settled upon consummation of the Business Combination in November 2017.
Income Tax Benefit: Income tax benefit decreased $4.2 million to $13.6 million for the nine months ended September 30, 2018 compared to $17.8 million for the nine months ended September 30, 2017. The decrease in income tax benefit was mainly due to a lower statutory income tax rate in the US partially offset by discrete tax benefits recorded at September 30, 2018 as compared to September 30, 2017.

Business Segment Results
Our principal line of business is modular leasing and sales. The Company formerly operated a Remote Accommodations Business, which was considered a single reportable segment. The Remote Accommodations Business was transferred to another entity included in the Algeco Group in connection with the Business Combination in November 2017 and is no longer a part of our business. Modular leasing and sales comprises two reportable segments: Modular - US and Modular - Other North America. The Modular - US reportable segment includes the contiguous 48 states and Hawaii, and the Modular - Other North America reportable segment includes Alaska, Canada and Mexico. The Acton and Tyson acquisitions are both included in the Modular - US segment, and ModSpace is included in both Modular segments as ModSpace operated in the United States and Canada. Corporate and other represents primarily SG&A related to the Algeco Group’s corporate costs, which were not incurred by WillScot in 2018. 
The following tables and discussion summarize our reportable segment financial information for the three and nine months ended September 30, 2018 and 2017. Future changes to our organizational structure may result in changes to the segments disclosed.

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Comparison of Three Months Ended September 30, 2018 and 2017 
Three Months Ended September 30, 2018 
(in thousands, except for units on rent and rates)Modular - USModular - Other North AmericaTotal
Revenue $197,625 $21,299 $218,924 
Gross profit $73,007 $7,939 $80,946 
Adjusted EBITDA $58,454 $6,164 $64,618 
Capital expenditures for rental equipment $43,007 $3,735 $46,742 
Modular space units on rent (average during the period) 67,978 7,435 75,413 
Average modular space utilization rate 73.8 %57.3 %71.8 %
Average modular space monthly rental rate $559 $587 $561 
Portable storage units on rent (average during the period) 15,373 408 15,781 
Average portable storage utilization rate 68.3 %56.4 %68.0 %
Average portable storage monthly rental rate $120 $101 $120 

Three Months Ended September 30, 2017 
(in thousands, except for units on rent and rates) Modular - US Modular - Other North America Corporate & Other Total 
Revenue $103,678 $12,723 $(239)$116,162 
Gross profit $37,766 $3,744 $(241)$41,269 
Adjusted EBITDA $29,177 $2,961 $(2,753)$29,385 
Capital expenditures for rental equipment $24,147 $1,361 $— $25,508 
Modular space units on rent (average during the period) 36,183 5,281 — 41,464 
Average modular space utilization rate 74.7 %54.1 %— %71.3 %
Average modular space monthly rental rate $542 $536 $— $541 
Portable storage units on rent (average during the period) 11,894 347 — 12,241 
Average portable storage utilization rate 70.6 %51.9 %— %69.8 %
Average portable storage monthly rental rate $117 $123 $— $117 
Modular - US Segment
Revenue: Total revenue increased $93.9 million, or 90.5%, to $197.6 million for the three months ended September 30, 2018 from $103.7 million for the three months ended September 30, 2017. Modular leasing revenue increased $61.4 million, or 92.2%, driven by improved pricing and volumes. Average modular space monthly rental rates increased 3.1% for the three months ended September 30, 2018, and average modular space units on rent increased 31,795 units, or 87.9%. Improved pricing was driven by a combination of our price optimization tools and processes, as well as by continued growth in our “Ready to Work” solutions and increased VAPS penetration across our customer base, offset partially by the average modular space monthly rental rates on acquired units. Improved volumes were driven by units acquired as part of the Acton, Tyson, and ModSpace acquisitions, as well as increased modular delivery and installation revenues on the combined rental fleet of 89.1%. The increases in leasing and services revenue were complemented by increases in sales revenues. New unit sales revenue increased $10.1 million, or 111.0% and rental unit sales revenue increased $2.7 million, or 45.8%. The increase year-over-year in new sales was primarily driven by a single large sale project. Increases in rental unit sales was primarily a result of the ModSpace acquisition and our larger post-acquisition fleet size.
On a pro-forma basis, including results of the WillScot, Acton, Tyson, and ModSpace for all periods presented, pricing improvement continued in the third quarter, with increases in pro-forma average modular space monthly rental rates of $65, or 13.4% for the three months ended September 30, 2018. Modular space units on rent increased 0.1% on a pro-forma basis to 86,953 and pro-forma utilization for our modular space units increased to 74.9%, up 320 bps from 71.8% for the three months ended September 30, 2017.
Gross Profit: Gross profit increased $35.2 million, or 93.1%, to $73.0 million for the three months ended September 30, 2018 from $37.8 million for the three months ended September 30, 2017. The increase in gross profit was driven by higher modular leasing and service revenues driven both by organic growth and through the Acton, Tyson and ModSpace acquisitions. The increase in gross profit from modular leasing and sales revenues was partially offset by an $16.0 million increase in depreciation of rental equipment primarily related to acquired units in the Acton, Tyson, and ModSpace acquisitions for the three months ended September 30, 2018.
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Adjusted EBITDA: Adjusted EBITDA increased $29.2 million, or 100.0%, to $58.4 million for the three months ended September 30, 2018 from $29.2 million for the three months ended September 30, 2017. The increase was driven by higher modular leasing and services gross profits discussed above, partially offset by increases in SG&A, excluding discrete items, of $15.5 million, of which $2.4 million represents public company costs including outside professional fees. The majority of the remaining increase was driven by increased headcount, occupancy, and other SG&A cost increases as a result of operating a larger operation as a result of our recent acquisitions and our expanded employee base and branch network.
Capital Expenditures for Rental Equipment: Capital expenditures increased $18.9 million, or 78.4%, to $43.0 million for the three months ended September 30, 2018 from $24.1 million for the three months ended September 30, 2017. Net capital expenditures also increased $16.2 million, or 89.0%, to $34.4 million. The increases for both were driven by increased spend for refurbishments, new fleet, and VAPS to drive revenue growth and for maintenance of a larger fleet following our Acton, Tyson, and ModSpace acquisitions.
Modular - Other North America Segment
Revenue: Total revenue increased $8.6 million, or 67.7%, to $21.3 million for the three months ended September 30, 2018 from $12.7 million for the three months ended September 30, 2017. Modular leasing revenue increased $4.8 million, or 53.9%, driven by improved pricing and volumes in the quarter. Average modular space monthly rental rates increased 9.5% and average modular space units on rent increased by 2,154 units, or 40.8% for the period, resulting in a higher modular space utilization which increased by 320 bps. Improved pricing was driven by a combination of our price optimization tools and processes, as well as by continued growth in our “Ready to Work” solutions and increased VAPS penetration across our customer base, further lifted by the average modular space monthly rental rates on acquired ModSpace units in Canada. Improved volumes were driven by units acquired as part of the ModSpace acquisition. Modular delivery and installation revenues increased $2.4 million, or 96.0%, new unit sales revenue increased $1.2 million, or 240.0%, and rental unit sales revenue increased $0.2 million, or 25.0%, all of which were primarily driven by the ModSpace acquisition.
On a pro-forma basis, including results of the WillScot and ModSpace for all periods presented, pricing improvement continued in the third quarter, with increases in pro-forma average modular space monthly rental rates of $5, or 0.9% for the three months ended September 30, 2018. Modular space units on rent decreased 3.6% on a pro-forma basis however, to 9,607 and pro-forma utilization for our modular space units decreased to 56.8%, down 110 bps from 57.9% for the three months ended September 30, 2017. 
Gross Profit: Gross profit increased $4.2 million, or 113.5%, to $7.9 million for the three months ended September 30, 2018 from $3.7 million for the three months ended September 30, 2017. The effects of favorable foreign currency movements increased gross profit by $0.2 million related to changes in the Canadian dollar and Mexican peso in relation to the US dollar. The increase in gross profit, excluding the effects of foreign currency, was driven primarily by increased leasing and services revenues. Higher modular volumes and pricing were complemented by higher modular delivery and installation margins. These were slightly offset by increased depreciation of rental equipment of $0.5 million for three months ended September 30, 2018.
Adjusted EBITDA: Adjusted EBITDA increased $3.2 million, or 106.7%, to $6.2 million for the three months ended September 30, 2018 from $3.0 million for the three months ended September 30, 2017. This increase was driven by increased leasing and services gross profit as a result of increased modular space volumes and average monthly rental rates, partially offset by increased SG&A of $1.7 million, also driven by the ModSpace acquisition.
Capital Expenditures for Rental Equipment: Capital expenditures increased $2.3 million, or 164.3%, to $3.7 million for the three months ended September 30, 2018 from $1.4 million for the three months ended September 30, 2017. Net capital expenditures also increased $2.1 million, or 350.0%, to $2.7 million. The increases for both were driven by increased spend for refurbishments, new fleet, and VAPS to drive revenue growth and for maintenance of a larger fleet following the ModSpace acquisitions.
Corporate and Other
Gross Profit: The Corporate and other adjustments to revenue and gross profit pertain to the elimination of intercompany leasing transactions between the business segments.
Adjusted EBITDA: Corporate and other costs and eliminations to consolidated Adjusted EBITDA were a loss of $2.8 million for the three months ended September 30, 2017, compared to no costs for the three months ended September 30, 2018. In 2017, Corporate and other represented primarily SG&A costs related to the Algeco Group’s corporate costs, which were not incurred by the Company in 2018.

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Comparison of Nine Months Ended September 30, 2018 and 2017 
Nine Months Ended September 30, 2018 
(in thousands, except for units on rent and rates)Modular - USModular - Other North AmericaTotal
Revenue $444,525 $49,483 $494,008 
Gross profit $169,556 $16,951 $186,507 
Adjusted EBITDA $129,170 $12,856 $142,026 
Capital expenditures for rental equipment $104,462 $7,043 $111,505 
Modular space units on rent (average during the period) 54,592 6,144 60,736 
Average modular space utilization rate 71.9 %57.1 %70.1 %
Average modular space monthly rental rate $553 $568 $555 
Portable storage units on rent (average during the period) 13,964 379 14,343 
Average portable storage utilization rate 68.6 %56.5 %68.3 %
Average portable storage monthly rental rate $124 $111 $123 

Nine Months Ended September 30, 2017 
(in thousands, except for units on rent and rates) Modular - USModular - Other North AmericaCorporate & OtherTotal
Revenue $289,302 $36,792 $(534)$325,560 
Gross profit $107,535 $11,779 $(524)$118,790 
Adjusted EBITDA $79,189 $8,586 $(10,197)$77,578 
Capital expenditures for rental equipment $72,105 $3,705 $— $75,810 
Modular space units on rent (average during the period) 35,679 5,010 — 40,689 
Average modular space utilization rate 73.6 %51.1 %— %69.8 %
Average modular space monthly rental rate $530 $532 $— $530 
Portable storage units on rent (average during the period) 12,238 352 — 12,590 
Average portable storage utilization rate 72.2 %52.1 %— %71.4 %
Average portable storage monthly rental rate $114 $117 $— $114 
Modular - US Segment
Revenue: Total revenue increased $155.2 million, or 53.6%, to $444.5 million for the nine months ended September 30, 2018 from $289.3 million for the nine months ended September 30, 2017. Modular leasing revenue increased $114.2 million, or 59.3%, driven by improved pricing and volumes. Average modular space monthly rental rates increased 4.3% for the nine months ended September 30, 2018, and average modular space units on rent increased 18,913 units, or 53.0%. Improved pricing was driven by a combination of our price optimization tools and processes, as well as by continued growth in our “Ready to Work” solutions and increased VAPS penetration across our customer base, offset partially by the average modular space monthly rental rates on acquired units. Improved volumes were driven by units acquired as part of the Acton, Tyson, and ModSpace acquisitions and organic unit on rent growth, as well as increased modular delivery and installation revenues on the combined rental fleet of 54.0%. The increases in leasing and services revenue were further complemented by increases in sales revenues. New unit sales revenue increased $8.6 million, or 39.8% and rental unit sales revenue decreased slightly by $0.3 million, or 2.1%. The increase year-over-year in new sales was primarily driven by a single large sale project in the third quarter.
On a pro-forma basis, including results of the WillScot, Acton, Tyson, and ModSpace for all periods presented, pricing improvement continued in the third quarter, with increases in pro-forma average modular space monthly rental rates of $56, or 11.9% for the nine months ended September 30, 2018. Modular space units on rent increased 787 units, or 0.9% on a pro-forma basis to 85,867 and pro-forma utilization for our modular space units increased to 74.7%, up 380 bps from 70.9% for the nine months ended September 30, 2018.
Gross Profit: Gross profit increased $62.0 million, or 57.7%, to $169.5 million for the nine months ended September 30, 2018 from $107.5 million for the nine months ended September 30, 2017. The increase in gross profit was driven by higher modular leasing and service revenues driven both by organic growth and through the Acton, Tyson, and ModSpace acquisitions. The increases in gross profit from modular leasing and service revenues were partially offset by a $28.6 million increase in depreciation of rental equipment for the nine months ended September 30, 2018 as a result of continued capital investment in our fleet, including additional depreciation related to the Acton, Tyson, and ModSpace acquisitions.
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Adjusted EBITDA: Adjusted EBITDA increased $49.9 million, or 63.0%, to $129.1 million for the nine months ended September 30, 2018 from $79.2 million for the nine months ended September 30, 2017. The increase was driven by higher modular leasing and services gross profits discussed above, as well as a gain recognized from the receipt of insurance proceeds related to assets damaged during Hurricane Harvey of $4.8 million for the nine months ended September 30, 2018. These increases were partially offset by increases in SG&A, excluding discrete items, of $24.7 million, of which $8.6 million represents public company costs including outside professional fees. The majority of the remaining increase was driven by increased headcount, occupancy, and other SG&A cost increases as a result of operating a larger operation as a result of our recent acquisitions and our expanded employee base and branch network.
Capital Expenditures for Rental Equipment: Capital expenditures increased $32.4 million, or 44.9%, to $104.5 million for the nine months ended September 30, 2018 from $72.1 million for the nine months ended September 30, 2017. Net capital expenditures increased $27.0 million, or 47.0%, to $84.5 million. The increases for both were driven by increased spend for refurbishments, new fleet, and VAPS to drive modular space unit on rent and revenue growth, and maintenance of a larger fleet following our recent acquisitions.
Modular - Other North America Segment
Revenue: Total revenue increased $12.8 million, or 34.8%, to $49.6 million for the nine months ended September 30, 2018 from $36.8 million for the nine months ended September 30, 2017. Modular leasing revenue increased $8.2 million, or 32.7%, driven by improved pricing and volumes. Average modular space monthly rental rates increased 6.8% and average modular space units on rent increased by 1,134 units, or 22.6% for the period driven by organic unit on rent growth as well as due to the ModSpace acquisition in the third quarter. Both of these resulted in a higher modular space utilization which increased by 600 bps. Modular delivery and installation revenues increased $5.2 million, or 85.2%, due primarily to a large camp installation during the second quarter and due to increased deliveries and returns as a result of the ModSpace acquisition. New unit sales revenue increased $0.5 million, or 17.2% and rental unit sales revenue decreased $1.1 million, or 40.7% associated with decreased sale opportunities.
On a pro-forma basis, including results of the WillScot and ModSpace for all periods presented, pricing improvement continued, with increases in pro-forma average modular space monthly rental rates of $4, or 0.7% for the nine months ended September 30, 2018, however, pro-forma average modular space units on rent decreased 151 units, or 1.6%. Pro-forma utilization for our modular space units was essentially flat in the period at 56.6%.
Gross Profit: Gross profit increased $5.2 million, or 44.1%, to $17.0 million for the nine months ended September 30, 2018 from $11.8 million for the nine months ended September 30, 2017.The effects of favorable foreign currency movements increased gross profit by $0.5million related to changes in the Canadian dollar and Mexican peso in relation to the US dollar. The increase in gross profit, excluding the effects of foreign currency, was driven primarily by higher leasing and services gross profits partially offset by lower rental unit sales as well as increased depreciation of rental equipment of $1.0 million, or 10.9%.
Adjusted EBITDA: Adjusted EBITDA increased $4.3 million, or 50.0%, to $12.9 million for the nine months ended September 30, 2018 from $8.6 million for the nine months ended September 30, 2017. This increase was driven by improved leasing and services gross profit, partially offset by increased SG&A of $2.2 million, or 17.7%.
Capital Expenditures for Rental Equipment: Capital expenditures increased $3.3 million, or 89.2%, to $7.0 million for the nine months ended September 30, 2018 from $3.7 million for the nine months ended September 30, 2017. Net capital expenditures increased $4.4 million to $5.4 million. The increases for both were driven primarily by investments in refurbishments of existing lease fleet and VAPS. A reduction in rental unit sales drove the remaining increase to net capital expenditures.
Corporate and Other
Gross Profit: The Corporate and other adjustments to revenue and gross profit pertain to the elimination of intercompany leasing transactions between the business segments.
Adjusted EBITDA: Corporate and other costs and eliminations to consolidated Adjusted EBITDA were a loss of $10.2 million for the nine months ended September 30, 2017, compared to no costs for the nine months ended September 30, 2018. In 2017, Corporate and other represented primarily SG&A costs related to the Algeco Group’s corporate costs, which were not incurred by the Company in 2018.


47


Other Non-GAAP Financial Data and Reconciliations
We use certain non-GAAP financial information that we believe is important for purposes of comparison to prior periods and development of future projections and earnings growth prospects. This information is also used by management to measure the profitability of our ongoing operations and analyze our business performance and trends.
We evaluate business segment performance on Adjusted EBITDA, a non-GAAP measure that excludes certain items as described in the reconciliation of our consolidated net loss to Adjusted EBITDA reconciliation below. We believe that evaluating segment performance excluding such items is meaningful because it provides insight with respect to intrinsic operating results of the Company.
We also regularly evaluate gross profit by segment to assist in the assessment of the operational performance of each operating segment. We consider Adjusted EBITDA to be the more important metric because it more fully captures the business performance of the segments, inclusive of indirect costs.
Adjusted EBITDA
We define EBITDA as net income (loss) plus interest (income) expense, income tax expense (benefit), depreciation and amortization. Our Adjusted EBITDA reflects the following further adjustments to EBITDA to exclude certain non-cash items and the effect of what we consider transactions or events not related to our core business operations:
• Currency (gains) losses, net: on monetary assets and liabilities denominated in foreign currencies other than the subsidiaries’ functional currency. Substantially all such currency gains (losses) are unrealized and attributable to financings due to and from affiliated companies.
• Goodwill and other impairment charges related to non-cash costs associated with impairment charges to goodwill, other intangibles, rental fleet and property, plant and equipment.
• Restructuring costs associated with restructuring plans designed to streamline operations and reduce costs including employee and lease termination costs.
• Costs to integrate acquired companies, including outside professional fees, fleet relocation expenses, employee training costs, and other costs.
• Non-cash charges for stock compensation plans.
• Other expense includes consulting expenses related to certain one-time projects, financing costs not classified as interest expense and gains and losses on disposals of property, plant, and equipment.
Adjusted EBITDA has limitations as an analytical tool, and you should not consider the measure in isolation or as a substitute for net income (loss), cash flow from operations or other methods of analyzing WillScot’s results as reported under GAAP. Some of these limitations are:
• Adjusted EBITDA does not reflect changes in, or cash requirements, for our working capital needs;
• Adjusted EBITDA does not reflect our interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness;
• Adjusted EBITDA does not reflect our tax expense or the cash requirements to pay our taxes;
• Adjusted EBITDA does not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments;
• Adjusted EBITDA does not reflect the impact on earnings or changes resulting from matters that we consider not to be indicative of our future operations;
• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and Adjusted EBITDA does not reflect any cash requirements for such replacements; and
• other companies in our industry may calculate Adjusted EBITDA differently, limiting its usefulness as a comparative measure.

48


Adjusted EBITDA
Because of these limitations, Adjusted EBITDA should not be considered as discretionary cash available to reinvest in the growth of our business or as measures of cash that will be available to meet our obligations. The following table provides an unaudited reconciliation of Net income (loss) to Adjusted EBITDA:
Three Months Ended September 30, Nine Months Ended September 30, 
(in thousands)2018201720182017
Net loss $(36,729)$(8,357)$(43,185)$(24,432)
Income from discontinued operations, net of tax — 5,078 — 11,123 
Loss from continuing operations (36,729)(13,435)(43,185)(35,555)
Income tax benefit (6,507)(7,632)(13,572)(17,770)
Loss from continuing operations before income tax (43,236)(21,067)(56,757)(53,325)
Interest expense, net (a) 43,447 26,447 67,321 74,922 
Depreciation and amortization 39,254 20,914 90,575 58,939 
Currency (gains) losses, net (425)(4,270)1,171 (12,769)
Restructuring costs 6,137 1,156 7,214 2,124 
Transaction costs10,672 5,233 14,790 6,095 
Integration costs 7,453 — 14,868 — 
Stock compensation expense 1,050 — 2,225 — 
Other expense 266 972 619 1,592 
Adjusted EBITDA $64,618 $29,385 $142,026 $77,578 
(a) Interest expense for the three and nine months ended September 30, 2018 includes $20.5 million of bridge financing fees and commitment fees related to the ModSpace acquisition. 
Adjusted Gross Profit
We define Adjusted Gross Profit as gross profit plus depreciation on rental equipment. Adjusted Gross Profit is not a measurement of our financial performance under GAAP and should not be considered as an alternative to gross profit or other performance measure derived in accordance with GAAP. In addition, our measurement of Adjusted Gross Profit may not be comparable to similarly titled measures of other companies. Management believes that the presentation of Adjusted Gross Profit provides useful information to investors regarding our results of operations because it assists in analyzing the performance of our business.
The following table provides an unaudited reconciliation of gross profit to Adjusted Gross Profit:
Three Months Ended September 30, Nine Months Ended September 30, 
(in thousands)2018201720182017
Gross profit$80,946 $41,269 $186,507 $118,790 
Depreciation of rental equipment35,534 19,009 82,849 53,203 
Adjusted Gross Profit$116,480 $60,278 $269,356 $171,993 

Net Capex for Rental Equipment
We define Net Capital Expenditures for Rental Equipment as capital expenditures for purchases and capitalized refurbishments of rental equipment, reduced by proceeds from the sale of rental equipment. Our management believes that the presentation of Net Capital Expenditures for Rental Equipment provides useful information to investors regarding the net capital invested into our rental fleet each year to assist in analyzing the performance of our business.

49


The following table provides an unaudited reconciliation of purchase of rental equipment to Net Capital Expenditures for Rental Equipment:
Three Months Ended September 30, Nine Months Ended September 30, 
(in thousands)2018201720182017
Total purchase of rental equipment and refurbishments$(46,742)$(28,053)$(111,505)$(82,276)
Total purchases of rental equipment from discontinued operations— (2,545)— (6,466)
Total purchases of rental equipment from continuing operations$(46,742)$(25,508)$(111,505)$(75,810)
Total proceeds from sale of rental equipment $9,560 8,128 $21,593 $18,750 
Total proceeds from sale of rental equipment from discontinued operations — (1,522)— (1,522)
Total proceeds from sale of rental equipment from continuing operations $9,560 $6,606 $21,593 $17,228 
Net Capital Expenditures for Rental Equipment$(37,182)$(18,902)$(89,912)$(58,582)

Adjusted EBITDA less Net CAPEX
We define Adjusted EBITDA less Net CAPEX as Adjusted EBITDA less the gross profit on sale of rental units, less Net Capital Expenditures. Adjusted EBITDA less Net CAPEX is not a measurement of our financial performance under GAAP and should not be considered as an alternative to net income (loss) or other performance measure derived in accordance with GAAP. In addition, our measurement of Adjusted EBITDA less Net CAPEX may not be comparable to similarly titled measures of other companies. Our management believes that the presentation of Adjusted EBITDA less Net CAPEX provides useful information to investors regarding our results of operations because it assists in analyzing the performance of our business.

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The following tables provide unaudited reconciliations of Net (loss) income to Adjusted EBITDA less Net CAPEX on a segment basis for the three and nine months ended September 30, 2018 and 2017:
Three Months Ended September 30, 2018 
(in thousands)Modular - USModular - Other North AmericaCorporate & OtherConsolidated
Net (loss) income$(44,519)$1,283 $6,507 $(36,729)
Income from discontinued operations, net of tax— — — — 
(Loss) income from continuing operations (44,519)1,283 6,507 (36,729)
Income tax benefit(a)
— — (6,507)(6,507)
(Loss) income from continuing operations before income tax (44,519)1,283 — (43,236)
Interest expense, net42,831 616 — 43,447 
Operating (loss) income (1,688)1,899 — 211 
Depreciation and amortization35,105 4,149 — 39,254 
EBITDA33,417 6,048 — 39,465 
Currency gains, net(112)(313)— (425)
Restructuring costs5,895 242 — 6,137 
Transaction costs 10,490 182 — 10,672 
Integration costs7,443 10 — 7,453 
Stock compensation expense1,050 — — 1,050 
Other expense (income)271 (5)— 266 
Adjusted EBITDA58,454 6,164 — 64,618 
Less:
Rental unit sales8,595 972 — 9,567 
Rental unit cost of sales5,025 725 — 5,750 
Gross profit on rental unit sales3,570 247 — 3,817 
Gain on insurance proceeds— — — — 
Less:
Total capital expenditures44,412 3,804 — 48,216 
Proceeds from rental unit sales8,588 972 — 9,560 
Net Capital Expenditures35,824 2,832 — 38,656 
Adjusted EBITDA less Net CAPEX$19,060 $3,085 $— $22,145 

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Three Months Ended September 30, 2017 
(in thousands)Modular - US Modular - Other North America Corporate & Other Consolidated 
Net loss$(1,070)$(1,684)$(5,603)$(8,357)
Income from discontinued operations, net of tax(b)
— — 5,078 5,078 
Loss from continuing operations(1,070)(1,684)(10,681)(13,435)
Income tax benefit(a)
— — (7,632)(7,632)
Loss from continuing operations before income tax(1,070)(1,684)(18,313)(21,067)
Interest expense, net16,790 1,134 8,523 26,447 
Operating income (loss)15,720 (550)(9,790)5,380 
Depreciation and amortization16,974 3,597 343 20,914 
EBITDA32,694 3,047 (9,447)26,294 
Currency gains, net(3,834)(104)(332)(4,270)
Restructuring costs247 17 892 1,156 
Transaction costs69 — 5,164 5,233 
Other expense1 1 970 972 
Adjusted EBITDA29,177 2,961 (2,753)29,385 
Less:
Rental unit sales5,922 765 (81)6,606 
Rental unit cost of sales3,204 580 — 3,784 
Gross profit (loss) on rental unit sales2,718 185 (81)2,822 
Less:
Total capital expenditures(b)
24,896 1,437 2,643 28,976 
Total capital expenditures from discontinued operations— — (2,643)(2,643)
Total capital expenditures from continuing operations24,896 1,437 — 26,333 
Proceeds from rental unit sales5,922 765 1,441 8,128 
Proceeds from rental unit sales from discontinued operations— — 1,522 1,522 
Proceeds from rental unit sales from continuing operations5,922 765 (81)6,606 
Net Capital Expenditures18,974 672 81 19,727 
Adjusted EBITDA less Net CAPEX$7,485 $2,104 $(2,753)$6,836 

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Nine Months Ended September 30, 2018 
(in thousands)Modular - USModular - Other North AmericaCorporate & OtherConsolidated
Net (loss) income$(55,360)$(1,397)$13,572 $(43,185)
Income from discontinued operations, net of tax— — — — 
(Loss) income from continuing operations (55,360)(1,397)13,572 (43,185)
Income tax benefit(a)
— — (13,572)(13,572)
Loss from continuing operations before income tax(55,360)(1,397)— (56,757)
Interest expense, net65,654 1,667 — 67,321 
Operating income 10,294 270 — 10,564 
Depreciation and amortization79,568 11,007 — 90,575 
EBITDA89,862 11,277 — 101,139 
Currency losses, net159 1,012 — 1,171 
Restructuring costs6,962 252 — 7,214 
Transaction costs 14,539 251 — 14,790 
Integration costs14,858 10 — 14,868 
Stock compensation expense2,225 — — 2,225 
Other expense565 54 — 619 
Adjusted EBITDA129,170 12,856 — 142,026 
Less:
Rental unit sales14,258 1,555 — 15,813 
Rental unit cost of sales8,218 1,110 — 9,328 
Gross profit on rental unit sales6,040 445 — 6,485 
Gain on insurance proceeds4,765 — — 4,765 
Less:
Total capital expenditures107,359 7,236 — 114,595 
Proceeds from rental unit sales20,038 1,555 — 21,593 
Net Capital Expenditures87,321 5,681 — 93,002 
Adjusted EBITDA less Net CAPEX$31,044 $6,730 $— $37,774 

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Nine Months Ended September 30, 2017 
(in thousands)Modular - USModular - Other North AmericaCorporate & OtherConsolidated
Net loss$(6,280)$(4,142)$(14,010)$(24,432)
Income from discontinued operations, net of tax(b)
— — 11,123 11,123 
Loss from continuing operations(6,280)(4,142)(25,133)(35,555)
Income tax benefit(a)
— — (17,770)(17,770)
Loss from continuing operations before income tax(6,280)(4,142)(42,903)(53,325)
Interest expense, net48,302 3,350 23,270 74,922 
Operating income (loss)42,022 (792)(19,633)21,597 
Depreciation and amortization47,967 9,928 1,044 58,939 
EBITDA89,989 9,136 (18,589)80,536 
Currency gains, net(11,233)(585)(951)(12,769)
Restructuring costs247 17 1,860 2,124 
Transaction costs115 — 5,980 6,095 
Other expense71 18 1,503 1,592 
Adjusted EBITDA79,189 8,586 (10,197)77,578 
Less:
Rental unit sales14,634 2,675 (81)17,228 
Rental unit cost of sales8,240 1,827 — 10,067 
Gross profit on rental unit sales6,394 848 (81)7,161 
Less:
Total capital expenditures(b)
74,498 3,860 6,856 85,214 
Total capital expenditures from discontinued operations— — (6,855)(6,855)
Total capital expenditures from continuing operations74,498 3,860 1 78,359 
Proceeds from rental unit sales14,634 2,675 1,441 18,750 
Proceeds from rental unit sales from discontinued operations— — 1,522 1,522 
Proceeds from rental unit sales from continuing operations14,634 2,675 (81)17,228 
Net Capital Expenditures59,864 1,185 82 61,131 
Adjusted EBITDA less Net CAPEX$12,931 $6,553 $(10,198)$9,286 
(a) The Company does not allocate expenses on a segment level. As such, we have included tax income benefit in Corporate and other for the purpose of this reconciliation.
(b) For the purpose of this reconciliation, the Company has included income and capital expenditures related to discontinued operations in Corporate and other as it all pertained to the Remote Accommodations segment which was discontinued as of November 29, 2017. 

Liquidity and Capital Resources
Overview
WillScot is a holding company that derives all of its operating cash flow from its operating subsidiaries. Our principal sources of liquidity include cash generated by operating activities from our subsidiaries, credit facilities and sales of equity and debt securities. We believe that our liquidity sources and operating cash flows are sufficient to address our future operating, debt service and capital requirements.
We may from time to time seek to retire or purchase our warrants through cash purchases and/or exchanges for equity securities, in open market purchases, privately-negotiated transactions, exchange offers or otherwise. Any such transactions will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.
ABL Facility 
On November 29, 2017, WS Holdings, WSII and certain of its subsidiaries entered into the ABL Facility with an aggregate principal amount of up to $600.0 million.
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In July and August 2018, the Company entered into three amendments (the "ABL Amendments") to the ABL Facility that, among other things, (i) permitted the ModSpace acquisition and the Company’s financing thereof, (ii) increased the ABL Facility limit to $1.425 billion in the aggregate, with an accordion feature allowing up to $1.8 billion of capacity, and (iii) increased certain thresholds, basket sizes and default and notice triggers to account for the Company’s increased scale following the ModSpace Acquisition.
Borrowings under the ABL Facility, at the Borrower’s option, bear interest at either an adjusted LIBOR or a base rate, in each case, plus an applicable margin. At inception of the ABL Facility until March 31, 2018, the applicable margin was fixed at 2.50% for LIBOR borrowings and 1.50% for base rate borrowings. Commencing on March 31, 2018, the applicable margins are subject to one step-down of 0.25% or one step-up of 0.25%, based on excess availability levels with respect to the ABL Facility. The ABL Facility requires the payment of an annual commitment fee on the unused available borrowings of between 0.375% and 0.5% per annum. At September 30, 2018, the weighted average interest rate for borrowings under the ABL Facility was 4.65%.
The ABL Facility requires the Borrowers to maintain a (i) minimum interest coverage ratio of 2.00:1.00 and (ii) maximum total net leverage ratio of 5.50:1.00, in each case, at any time when the excess availability under the amended ABL Facility is less than the greater of (a) $135.0 million and (b) an amount equal to 10% of the Line Cap.
At September 30, 2018, the Borrowers had $552.9 million of available borrowing capacity under the ABL Facility, including $414.5 million under the US ABL Facility and $138.4 million under the Canadian ABL Facility.
2022 Senior Secured Notes 
On November, 29, 2017, WSII issued the 2022 Secured Notes with a $300.0 million aggregate principal amount that bear interest at 7.875% and mature on December 15, 2022. The net proceeds, along with other funding obtained in connection with the Business Combination, were used to repay $669.5 million outstanding under WSII’s former credit facility, to repay $226.3 million of notes due to affiliates and related accrued interest, and to pay $125.7 million of the cash consideration paid for 100% of the outstanding equity of WSII. Interest on the 2022 Secured Notes is payable semi-annually on June 15 and December 15 beginning June 15, 2018.
2023 Senior Secured Notes
On August 6, 2018, a special purpose subsidiary of WSII completed a private offering of $300.0 million in aggregate principal amount of its 6.875% senior secured notes due August 15, 2023. The issuer entered into an indenture dated August 6, 2018 with Deutsche Bank Trust Company Americas, as trustee, which governs the terms of the 2023 Secured Notes. In connection with the ModSpace acquisition, the issuer merged with and into WSII and WSII assumed the 2023 Secured Notes. Interest is payable semi-annually on February 15 and August 15 of each year, beginning February 15, 2019. The net proceeds were used to fund the ModSpace acquisition.
2023 Senior Unsecured Notes
On August 3, 2018, a special purpose subsidiary of WSII completed a private offering of $200.0 million in aggregate principal amount of its senior unsecured notes due November 15, 2023 (the “Unsecured Notes”). The issuer entered into an indenture with Deutsche Bank Trust Company Americas, as trustee (the “Unsecured Notes Indenture”), which governs the terms and conditions of the Unsecured Notes. In connection with the ModSpace acquisition, the issuer merged with and into WSII and WSII assumed the Unsecured Notes.
The Unsecured Notes bear interest at a rate of 10% per annum if paid in cash (or if paid in kind, 11.5% per annum) for any interest period ending on or before February 15, 2021, and thereafter are payable solely in cash at an increased rate per annum of 12.5%. Interest is payable semi-annually on February 15 and August 15 of each year, beginning February 15, 2019. The net proceeds were used to fund the ModSpace acquisition.
Cash Flow Comparison of the Nine Months Ended September 30, 2018 and 2017 
The following summarizes our cash flows for the periods presented on an actual currency basis:
Nine Months Ended September 30, 
(in thousands)2018 2017 
Net cash from operating activities$15,580 $46,901 
Net cash from investing activities(1,176,468)(134,235)
Net cash from financing activities1,161,406 91,677 
Effect of exchange rate changes on cash and cash equivalents68 311 
Net change in cash and cash equivalents$586 $4,654 
The cash flow data for the nine months ended September 30, 2017 includes the activity of the Remote Accommodations Business, which is no longer a part of the company following the Carve-out Transaction, and is presented as discontinued operations in the condensed consolidated financial statements.
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Cash Flows from Operating Activities
Cash provided by operating activities for the nine months ended September 30, 2018 was $15.6 million as compared to $46.9 million for the nine months ended September 30, 2017, a decrease of $31.3 million. The reduction in cash provided by operating activities was predominantly due to higher use of cash to pay down accounts payable and accrued liabilities associated both to transaction expenses incurred for the Business Combination as well as normal operating liabilities. Additionally, the cash flow from operating activities for the nine months ended September 30, 2017 include cash generated from the Remote Accommodations Business which is no longer a part of the Company following the Carve-out Transaction that occurred in the fourth quarter of 2017.
Cash flows from investing activities
Cash used in investing activities for the nine months ended September 30, 2018 was $1,176.5 million as compared to $134.2 million for the nine months ended September 30, 2017, an increase of $1,042.3 million. The increase in cash used in investing activities was principally the result of the acquisitions of Tyson and ModSpace for cash consideration of $24.0 million and $1,060.1 million during 2018. Additionally, cash used for rental equipment expenditures increased $29.2 million driven primarily by strategic investment in refurbishment of existing fleet, purchase of VAPS, and new fleet purchases to maintain and grow units on rent. The increase in cash used was partially offset by a $69.9 million decrease in cash used in lending to affiliates. In 2018, we did not engage in any lending activities as the notes due from affiliates were settled as part of the Business Combination.
Cash flows from financing activities
Cash provided by financing activities for the nine months ended September 30, 2018 was $1,161.4 million as compared to $91.7 million for the nine months ended September 30, 2017, an increase of $1,069.7 million. The increase is primarily driven by the increased borrowings of $300.0 million, $200.0 million, and $579.1 million related to issuance of the 2023 Secured Notes, the issuance of the Unsecured Notes, and additional borrowings on the up-sized ABL Facility to finance the acquisition of ModSpace in the third quarter of 2018. We also received proceeds from the issuance of the Company's Class A common stock of $147.2 million during the third quarter of 2018. 
The increase in cash provided by financing activities was partially offset by $75.0 million decrease in borrowings from notes due to affiliates and a $24.2 million increase in the payment of financing costs. The notes due from affiliates were settled in connection with the Business Combination in the fourth quarter of 2017 and were driven by a centralized cash management strategy utilized by the Algeco Group. Payments of financing costs increased in connection with the issuance of the 2023 Secured Notes, the Unsecured Notes, the amendments to the ABL Facility, and the issuance of common stock.

Contractual Obligations
Since the issuance of our 2017 Form 10-K, our contractual obligations increased significantly for the three and nine months ended September 30, 2018. Our contractual obligations have increased in conjunction with the financing transactions related to the ModSpace acquisition. In addition to the existing debt at the acquisition date, the Company incurred $300.0 million of debt for the 2023 Secured Notes, $200.0 million of debt for the Unsecured Notes, and an increase in the ABL balance of $579.1 million as of the date of the ModSpace acquisition, August 15, 2018.

Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Critical Accounting Policies and Estimates
Our discussion and analysis of our financial condition, results of operations, liquidity and capital resources is based on our condensed consolidated financial statements, which have been prepared in accordance with GAAP. GAAP requires that we make estimates and judgments that affect the Company’sreported amount of assets, liabilities, revenue, expenses and the related disclosure of contingent assets and liabilities. We base these estimates on historical experience and on various other assumptions that we consider reasonable under the circumstances, and reevaluate our estimates and judgments as appropriate. The actual results experienced by us may differ materially and adversely from our estimates.
Our significant accounting policies are described in Note 1 of the audited consolidated financial statements included in our 2017 Form 10-K. The US Securities and Exchange Commission (the “SEC”) suggests companies provide additional disclosure on those accounting policies considered most critical. The SEC considers an accounting policy to be critical if it is important to our financial condition and results of operations should be readand requires significant judgments and estimates on the part of management in conjunctionits application. For the nine months ended September 30, 2018, we have provided an additional disclosure on
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our stock-based compensation policies as described in Note 12 of this Form 10-Q and regarding our goodwill policy and estimates below. For a complete discussion of our critical accounting policies, see the “Critical Accounting Policies and Estimates” section of the MD&A in our 2017 Form 10-K.
Goodwill
We perform our annual goodwill impairment test on October 1. In addition, we perform qualitative impairment tests during any reporting period in which events or changes in circumstances quantitatively indicate that impairment may have occurred. Management judgment is a significant factor in the goodwill impairment evaluation process. The computations require management to make estimates and assumptions. Actual values may differ significantly from these assumptions, particularly if there are significant adverse changes in the operating environment of our reporting units.
In assessing the fair value of reporting units, we consider the market approach, the income approach, or a combination of both. Under the market approach, the fair value of the reporting unit is based on quoted market prices of companies comparable to the reporting unit being valued. While the market prices are not an assumption, a presumption that they provide an indicator of the value of the reporting unit is inherent in the valuation. The initial determination of the comparable companies also involves a degree of judgment.
Under the income approach, the fair value of the reporting unit is based on the present value of estimated cash flows. The income approach relies on the timing and estimates of future cash flows, which are based on management’s estimates of economic and market conditions over the projected period, including growth rates in revenue, operating margins, capital expenditures and tax rates. The cash flows are based on our most recent business operating plans and various growth rates have been assumed for years beyond the current business plan period. The income approach also relies upon the selection of an appropriate discount rate, which is based on a weighted-average cost of capital analysis. The discount rate is affected by changes in short-term interest rates and long-term yield, as well as by variances in the typical capital structure of marketplace participants. Given current economic conditions, it is possible that the discount rate will fluctuate in the near term.
On August 15, 2018 the Company completed its acquisition of ModSpace. The Company has performed a preliminary allocation of assets acquired and liabilities assumed as well an allocation of net assets, including goodwill, amongst its reporting units. As of September 30, 2018 the Company has allocated $203.3 million and $32.5 million of goodwill to the US and Canadian reporting units, respectively. For the quarter ended September 30, 2018 the Company completed its interim review for impairment indicators for all reporting units, identifying no events or changes in circumstances that indicate an impairment may have occurred. The Company will perform its annual goodwill impairment test on October 1, 2018. While no indicators of impairment are currently present, due to Company’s historical impairment activity associated with its Canadian reporting unit, it is possible that the unaudited condensedannual impairment test may indicate a need to write down the preliminary goodwill balance allocated to the Canadian reporting unit.

Recently Issued Accounting Standards
Refer to Note 1 of the notes to our financial statements and the notes thereto contained elsewhereincluded in this report. Certain information contained in the discussionForm 10-Q for our assessment of recently issued and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

adopted accounting standards.


Cautionary Note Regarding Forward-Looking Statements

The statements contained in this report that are not purely historical are forward-looking statements. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this

This Quarterly Report on Form 10-Q may include, for example, statements about:

·our ability to complete our initial business combination;

·our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination;

·our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination, as a result of which they would then receive expense reimbursements;

·our potential ability to obtain additional financing to complete our initial business combination;

·our pool of prospective target businesses;

·the ability of our officers and directors to generate a number of potential investment opportunities;

·our public securities’ potential liquidity and trading;

·the lack of a market for our securities;

·the use of proceeds not held in the Trust Account (as described herein) or available to us from interest income on the Trust Account balance; or

·our financial performance.

 Theincludes forward-looking statements contained in this report are based on our current expectationswithin the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated.Section 21E of the Exchange Act. These forward-looking statements involverelate to expectations for future financial performance, business strategies or expectations for the post-combination business. Specifically, forward-looking statements may include statements relating to:

• our ability to effectively compete in the modular space and portable storage industry;
• changes in demand within a number of risks, uncertainties (somekey industry end-markets and geographic regions;
• effective management of which areour rental equipment;
• our ability to acquire and successfully integrate new operations;
• market conditions and economic factors beyond our control) or other assumptions that may cause actualcontrol;
• our ability to properly design, manufacture, repair and maintain our rental equipment;
• our operating results or performancefinancial estimates fail to be materially different from those expressedmeet or impliedexceed our expectations;
• operational, economic, political and regulatory risks;
• the effect of changes in state building codes on our ability to remarket our buildings;
• our ability to effectively manage our credit risk, collect on our accounts receivable, or recover our rental equipment;
• foreign currency exchange rate exposure;
• increases in raw material and labor costs;
• our reliance on third party manufacturers and suppliers;
• risks associated with labor relations, labor costs and labor disruptions;
• failure to retain key personnel;
• the effect of impairment charges on our operating results;
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• our inability to recognize or use deferred tax assets and tax loss carry forwards;
• our obligations under various laws and regulations;
• the effect of litigation, judgments, orders or regulatory proceedings on our business;
• unanticipated changes in our tax obligations;
• any failure of our management information systems;
• our ability to design, implement and maintain effective internal controls, including disclosure controls and controls over financial reporting;
• natural disasters and other business disruptions;
• our exposure to various possible claims and the potential inadequacy of our insurance;
• our ability to deploy our units effectively, including our ability to close projected unit sales;
• any failure by these forward-looking statements. These risksour prior owner or its affiliates to perform under or comply with our transition services and uncertainties include, but are not limitedintellectual property agreements;
• our ability to those factors describedfulfill our public company obligations;
• our subsidiaries’ ability to meet their debt service requirements and obligations;
• our subsidiaries’ ability to take certain actions, or to permit us to take certain actions, under the headingagreements governing their indebtedness; and
• other factors detailed under the section entitled “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2016. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. 2017.
We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Overview

We are a blank check company incorporated as a Cayman Islands exempted company on June 26, 2015 and formed for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (“Business Combination”). We intend to consummate a Business Combination using cash from the proceeds of our initial public offering (the “Public Offering”) that closed on September 16, 2015 (the “Closing Date”) and the private placement of warrants to purchase our Class A ordinary shares (“Private Placement Warrants”) that also occurred on the Closing Date, and from additional issuances of, if any, our equity and our debt, or a combination of cash, equity and debt.


The issuance of additional ordinary shares in a business combination:

·may significantly dilute the equity interest of investors in the Public Offering, which dilution would increase if the anti-dilution provisions in the Class B ordinary shares resulted in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the Class B ordinary shares;

·may subordinate the rights of holders of ordinary shares if preferred shares are issued with rights senior to those afforded our ordinary shares;

·could cause a change in control if a substantial number of our ordinary shares are issued, which may affect, among other things, our ability to use our net operating loss carryforwards, if any, and could result in the resignation or removal of our present executive officers and directors;

·may have the effect of delaying or preventing a change in control of us by diluting the share ownership or voting rights of a person seeking to obtain control of us; and

·may adversely affect prevailing market prices for our Class A ordinary shares and/or warrants to purchase our Class A ordinary shares.

Similarly, if we issue debt securities, it could result in:

·default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations;

·acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;

·our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;

·our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding;

·our inability to pay dividends on our ordinary shares;

·using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our ordinary shares, if declared, expenses, capital expenditures, acquisitions and other general corporate purposes;

·limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;

·increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and

·limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt.

At September 30, 2017, we held cash and cash equivalents of $13,326, current liabilities of $2,083,461 and deferred underwriting compensation of $19,500,000. Further, we expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete the Business Combination will be successful.

16 

by law.

Recent Events

Stock Purchase Agreement

On August 21, 2017, the Company entered into a Stock Purchase Agreement, as amended on September 6, 2017 and November 6, 2017 and as may be further amended (the “Stock Purchase Agreement”), by and among the Company, Williams Scotsman Holdings Corp, a wholly owned subsidiary of the Company (“Holdco Acquiror”, and, together with the Company, the “Acquirors”), Algeco Scotsman Global S.à r.l. and Algeco Scotsman Holdings Kft. (together with Algeco Scotsman Global S.à r.l., the “Sellers”). Pursuant to the Stock Purchase Agreement, the Company will re-domesticate as a Delaware corporation and the Holdco Acquiror will purchase from Sellers all of the issued and outstanding shares of common stock, par value $0.01 per share, of Williams Scotsman International, Inc. (“Williams Scotsman”), resulting in Williams Scotsman becoming a wholly owned subsidiary of the Company (the “Business Combination”). In addition, the Company will domesticate as a Delaware corporation and the continuing entity will be renamed “William Scotsman Corporation” or “WSC”.

Under the Stock Purchase Agreement, the Holdco Acquiror will purchase from the Sellers, and the Sellers will sell to the Holdco Acquiror, in each case, on a pro rata basis in accordance with each Seller’s respective ownership of Williams Scotsman common stock, par value $0.01 per share (“Williams Scotsman common stock”), all of the issued and outstanding shares of Williams Scotsman common stock. The total amount payable by the Holdco Acquiror under the Stock Purchase Agreement is $1.1 billion (which amount is inclusive of the amounts required to pay third party and intercompany indebtedness as of the closing), of which (1) $1.0215 billion will be paid in cash (the “Cash Consideration”), first to repay indebtedness of Williams Scotsman as contemplated by the Stock Purchase Agreement, with the remainder to be paid directly to the Sellers as consideration for the shares, on a pro rata basis, and (2) the remaining $78.5 million will be paid to the Sellers as additional consideration for the shares, on a pro rata basis, in the form of (i) shares of common stock of the Holdco Acquiror, representing a 10% equity interest in the Holdco Acquiror (the “Holdco Shares”), which shares will be exchangeable for shares of WSC Class A common stock pursuant to an exchange agreement and (ii) a corresponding number of shares of WSC Class B common stock, representing a non-economic voting interest in WSC equal to the economic interest in WSC represented by the Holdco Shares on an as-exchanged basis (the “WSC Class B Shares” and, together with the Holdco Shares, the “Stock Consideration”). The Cash Consideration is expected to be funded from (i) gross debt financing proceeds of at least $490 million from secured debt financing commitments of $900 million in the aggregate, (ii) an equity investment by TDR Capital II Holdings L.P. (the “TDR Investor”) in an amount equal to the Closing Date Commitment (as defined below) and (iii) cash in the Company’s trust account of at least $250 million and up to $500 million.

The consummation of the business combination is conditioned upon, among other things, the Company receiving gross proceeds of at least $490 million of debt financing and an equity investment in an amount equal to the Closing Date Commitment, approval by the Company’s shareholders of the Stock Purchase Agreement, the business combination and certain other actions related thereto, the consummation of a restructuring transaction relating to Williams Scotsman pursuant to which certain assets of WSII related to the remote accommodation business in the United States and Canada (Target Logistics) of Algeco Scotsman Global S.à r.l. (collectively with its subsidiaries, the “Algeco Group”) will be transferred to the Sellers or their affiliates (the “Carve-Out Transaction”), the availability of at least $250 million of cash in the Company’s trust account, after giving effect to redemptions of public shares, if any, the Company having at least $125 million of cash on a pro forma basis after giving effect to the consummation of the business combination and the other transactions contemplated thereby, and the receipt of consent from the existing lenders of the Sellers and certain of their affiliates. Unless waived, if any of these conditions are not satisfied, the business combination may not be consummated. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

In order to finance a portion of the Cash Consideration payable in the business combination and the costs and expenses incurred in connection therewith, (i) the Company entered into an amended equity commitment letter with the TDR Investor (the “Equity Commitment Letter”) and (ii) the Holdco Acquiror entered into an amended and restated debt commitment letter (the “Debt Commitment Letter”) with Bank of America, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated (“BofA Merrill Lynch”), Deutsche Bank AG, Canada Branch, Deutsche Bank AG Cayman Islands Branch, Deutsche Bank AG, New York Branch, Deutsche Bank Securities Inc., Morgan Stanley Senior Funding, Inc., Goldman Sachs Lending Partners LLC, Credit Suisse AG, Credit Suisse Securities (USA) LLC and ING Capital LLC (collectively, the “Commitment Parties”). Pursuant to the terms of the Equity Commitment Letter, the TDR Investor has committed to purchase, or cause the purchase of, (i) shares of WSC Class A common stock at a cash purchase price of $9.60 per share in an amount necessary to fund the Cash Consideration and the expenses relating to the business combination, as agreed to by the parties, after taking into account the debt financing proceeds and the trust account proceeds that are available to the Company plus (ii) up to 10 million additional shares of WSC Class A common stock at a cash purchase price of $10.00 per share, which amount of additional shares shall be dependent upon the aggregate dollar amount of redemptions at Closing (the “Closing Date Commitment”), which aggregate amount shall not exceed $500 million. In addition, following the Closing, if requested by WSC in connection with certain qualifying acquisitions, for a period of time following closing, on the terms and subject to the conditions set forth in the Equity Commitment Letter, the TDR Investor has committed to purchase, or cause the purchase of, additional shares of WSC Class A common stock at a cash purchase price of $10.00 per share in an amount equal to the difference between $500 million and the amount of the Closing Date Commitment (the “Post-Closing Commitment”), which amount, together with the Closing Date Commitment, shall not exceed $500 million. Pursuant to the terms of the Debt Commitment Letter, the Commitment Parties committed to make available to the Holdco Acquiror, at closing, a senior secured revolving credit facility in the aggregate principal amount of $600 million (the “ABL Facility”) and, to the extent the Holdco Acquiror does not receive at least $300 million of gross proceeds from the issuance of senior secured notes on the Closing Date, $300 million (minus the amount of gross proceeds from the issuance of senior secured notes on or prior to the Closing Date) aggregate principal amount of increasing rate loans (the “Bridge Loans”).

On the effective date of the domestication, the currently issued and outstanding Class B ordinary shares, par value $0.0001 per share, of Double Eagle (“Class B ordinary shares”) will automatically convert by operation of law, on a one-for-one basis, into Class A ordinary shares, par value $0.0001 per share, of Double Eagle (“Class A ordinary shares”). Immediately thereafter, the currently issued and outstanding Class A ordinary shares, will automatically convert by operation of law, on a one-for-one basis, into shares of Class A common stock, par value $0.0001 per share, of WSC (“WSC Class A common stock” and together with the WSC Class B common stock, the “WSC common stock”) in accordance with the terms of the certificate of incorporation of WSC to be filed with the Secretary of State of the State of Delaware (the “Proposed Charter”).


On September 6, 2017, the Company filed a registration statement on Form S-4 (the “Registration Statement”) with the SEC containing a preliminary proxy statement/prospectus relating to the Stock Purchase Agreement and the shareholder approval required to be sought from the shareholders of the Company. The Registration Statement was declared effective on November 7, 2017.

Extension Amendment

On September 15, 2017, the Company held an extraordinary general meeting whereby its shareholders approved an amendment to the Company’s amended and restated memorandum and articles of association to extend the date by which the Company must consummate a Business Combination from September 16, 2017 to December 31, 2017 (the “Extension Amendment”). The number of ordinary shares redeemed in connection with the Extension Amendment was 295,671. The Company distributed $2,978,166, or approximately, $10.05 per share, to redeeming shareholders. After giving effect to such redemptions, the balance in the Company’s Trust Account was $500,828,554.

Results of Operations

For the three months ended September 30, 2017 and September 30, 2016, we had losses from operations of 1,027,322 and 137,376, respectively. For the nine months ended September 30, 2017 and September 30, 2016, we had losses from operations of 2,230,228 and 542,401, respectively. Our business activities from our inception through September 30, 2017 consisted solely of completing our Public Offering, and identifying and evaluating prospective acquisition targets for a Business Combination.

Liquidity and Capital Resources

Prior to our Public Offering, we issued an aggregate of 12,218,750 Class B ordinary shares, or founder shares, to Double Eagle Acquisition LLC, a Delaware limited liability company (our “Sponsor”) for an aggregate purchase price of $25,000 in cash, or approximately $0.002 per share. On July 29, 2015, our Sponsor transferred 6,109,375 founder shares to Harry E. Sloan for a purchase price of $12,500 (the same per-share purchase price initially paid by our Sponsor). On August 27, 2015, our Sponsor and Mr. Sloan transferred an aggregate of 25,000 founder shares on a pro rata basis to each of our independent directors at their original purchase price. On August 27, 2015, Mr. Sloan transferred 665,500 founder shares to our Sponsor. On September 10, 2015, we effected a share capitalization of approximately ..129 shares for each outstanding Class B ordinary share, resulting in our initial shareholders holding an aggregate of 13,800,000 founder shares. The closing of the Public Offering included an initial partial exercise (2,000,000 units) of the overallotment option granted to the underwriters which resulted in the forfeiture of an aggregate of 1,300,000 founder shares (the “Forfeited Founder Shares”) by the Sponsor, Harry E. Sloan and the Company’s independent directors (consisting of 1,271,771 Forfeited Founder Shares forfeited by the Sponsor, 18,524 founder shares forfeited by Harry E. Sloan and 3,235 Forfeited Founder Shares forfeited by each of the Company’s independent directors) due to the underwriters not exercising their over-allotment option in full and such that the remaining founders shares will equal 20% of the equity capital of the Company.

On September 16, 2015, we consummated the Public Offering of 50,000,000 units (including the issuance of 2,000,000 units as a result of the underwriters’ partial exercise of their over-allotment option) at a price of $10.00 per unit generating gross proceeds of $500,000,000 before underwriting discounts and expenses. Simultaneously with the consummation of the Public Offering, on the Closing Date, we effected the private sale of an aggregate of 19,500,000 Private Placement Warrants, each exercisable to purchase one-half of one Class A ordinary share at $5.75 per one-half share, to the Sponsor, at a price of $0.50 per Private Placement Warrant.

We received gross proceeds from the Public Offering and the sale of the Private Placement Warrants of $500,000,000 and $9,750,000, respectively, for an aggregate of $509,750,000. $500,000,000 of the gross proceeds were deposited in a trust account with Continental Stock Transfer and Trust Company acting as Trustee (the “Trust Account”). At the Closing Date, the remaining $9,750,000 was held outside of the Trust Account, of which $8,000,000 was used to pay underwriting discounts. $20,000 in offering expenses were paid by the Sponsor prior to the Public Offering in exchange for founder shares. In the future, a portion of the interest income on the funds held in the Trust Account may be released to us to pay tax obligations. At September 30, 2017, funds held in the Trust Account consisted solely of investments solely in short term treasury securities and cash deposits.

At September 30, 2017, we had cash and cash equivalents held outside of the Trust Account of $13,326, which is available to fund our working capital requirements and accrued offering expenses. It is anticipated that the Company may incur loans from the Sponsor, as permitted in the Public Offering, for additional working capital for Company’s ordinary operations and in pursuit of a business combination. In the event of liquidation, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be less than the initial public offering price per unit in the Public Offering.


At September 30, 2017, we had current liabilities of $2,083,461, largely due to short term financing of amounts owed to professionals, consultants, advisors and others who performed services or are working on identifying and evaluating a Business Combination. In addition, as of September 30, 2017, we had accounts payable and accrued expenses of approximately $350,000, primarily representing amounts owed to certain service providers and advisors who have advised us on matters related to the proposed business combination with Williams Scotsman. We have entered into fee arrangements with certain service providers, advisors and the Sponsor pursuant to which certain fees and advanced costs incurred by us in connection with the proposed business combination with Williams Scotsman will be deferred and become payable only if we consummate an initial business combination. If an initial business combination does not occur, we will not be required to pay these contingent fees. To the extent a potential initial business combination is consummated, we anticipate incurring a significant amount of additional costs. There can be no assurances that we will complete any initial business combination. We may also request loans from our Sponsor, affiliates of our Sponsor or certain of our executive officers and directors to fund our working capital requirements prior to completing a Business Combination. We may use working capital to repay such loans, but no funds may be withdrawn from the Trust Account for such repayment unless and until we complete an initial business combination. Additional funds could also be raised through a private offering of debt or equity. Our Sponsor, affiliates of our Sponsor, executive officers and directors are not obligated to make loans to us, and we may not be able to raise additional funds from unaffiliated parties. If we are unable to fund future working capital needs, if any, prior to completion of a Business Combination, our ability to continue as a going concern may be impaired.

We have until December 31, 2017 to complete the Business Combination. If we do not complete the Business Combination within this time period, we will (i) cease all operations except for the purposes of winding up, (ii) as promptly as reasonably possible, but not more than ten business days thereafter, redeem the public shares, at a per share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (less up to $100,000 of interest to pay dissolution expenses), less income taxes payable, divided by the number of then outstanding public shares, which redemption will completely extinguish the shareholder rights of owners of Class A ordinary shares (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.

We intend to use substantially all of the funds held in the Trust Account, including interest, less income taxes payable, to consummate the Business Combination. To the extent that our equity or debt is used, in whole or in part, as consideration to consummate the Business Combination, the remaining proceeds held in the Trust Account after completion of the Business Combination and redemptions of Class A ordinary shares, if any, will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategy.

We may have insufficient funds available to operate our business prior to our Business Combination. Moreover, we may need to obtain additional financing either to complete the Business Combination or because we become obligated to redeem a significant number of our Class A ordinary shares upon completion of the Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination.

Off-Balance Sheet Financing Arrangements

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements.

We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or entered into any non-financial agreements involving assets.

Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities other than an administrative agreement to reimburse the Sponsor for office space, secretarial and administrative services provided to members of the Company’s management team by the Sponsor, members of the Sponsor, and the Company’s management team or their affiliates in an amount not to exceed $15,000 per month in the event such space and/or services are utilized and the Company does not pay a third party directly for such services, from the date of closing of the Public Offering. Upon completion of a Business Combination or the Company’s liquidation, the Company will cease paying these monthly fees.

19 


Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following as our critical accounting policies:

Redeemable Ordinary Shares

All Class A ordinary shares sold as part of the units in the Public Offering contain a redemption feature under which holders of Class A ordinary shares may, two business days prior to the consummation of a Business Combination, redeem their Class A ordinary shares for a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest, less income taxes payable, divided by the number of then outstanding Class A ordinary shares. In accordance with ASC 480, “Distinguishing Liabilities from Equity” (“ASC 480”), redemption provisions not solely within an entity’s control require the security to be classified outside of permanent equity. Ordinary liquidation events, which involve the redemption and liquidation of all of an entity’s equity instruments, are excluded from the provisions of ASC 480. Although we did not specify a maximum redemption threshold, our charter provides that in no event will we redeem our Class A ordinary shares in an amount that would cause our net tangible assets, or total shareholders’ equity, to fall below $5,000,001. Accordingly, at September 30, 2017 and December 31, 2016, 47,428,415, and 47,702,674, respectively, of our Class A ordinary shares were classified outside of permanent equity.

Net Income per Ordinary Share

Basic net income per ordinary share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the period. Diluted net income per share is computed by dividing net income per share by the weighted average number of ordinary shares outstanding (including shares subject to redemption), plus, to the extent dilutive, the incremental number of ordinary shares to settle private placement warrants held by the Sponsor, as calculated using the treasury stock method. An aggregate of 47,428,415 shares of Class A ordinary shares subject to possible redemption at September 30, 2017 have been excluded from the calculation of basic income per ordinary shares for the three and nine months ended September 30, 2017 since such shares, if redeemed, only participate in their pro rata share of the trust earnings. The Company has not considered the effect of warrants sold in the Initial Public Offering in the calculation of diluted income per share, since their inclusion would be anti-dilutive.

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on our financial statements.

Item

ITEM 3. Quantitative and Qualitative Disclosures Aboutabout Market Risk.

To date, our effortsRisk

There have been limitedno significant changes to organizational activities and activities relating to the Public Offering and the identification and evaluation of prospective acquisition targets for a Business Combination. We have neither engaged in any operations nor generated any revenues. The net proceeds from our Public Offering and the sale of Private Placement Warrants held in the Trust Account are comprised entirely of cash. We may invest funds held in the Trust Account in permitted United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), having a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. Our only market risk since December 31, 2017. For a discussion of our exposure will relate to fluctuations in interest rates and the resulting impactmarket risk, refer to our Annual Report on the value of investments held in the Trust Account. Due to the short-term nature of such investments, we do not believe that we will be subject to material exposure due to interest rate risk.

At September 30, 2017, $500,828,554 was held in the Trust AccountForm 10-K for the purposes of consummating the Business Combination. If we complete the Business Combination byyear ended December 31, 2017, the funds in the Trust Account will be used to pay for the Business Combination, redemptions of Class A ordinary shares, if any, the deferred underwriting compensation and accrued expenses related to the Business Combination. Any funds remaining will be made available to us to provide working capital to finance our operations.

2017.


We have not engaged in any hedging activities since our Inception. We do not expect to engage in any hedging activities with respect to the market risk to which we are exposed.

Item

ITEM 4. Controls and Procedures.

Procedures

Evaluation of Disclosure controlsControls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submittedProcedures
We carried out an evaluation, under the Securities Exchange Actsupervision of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2017.2018. Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as definedwere not effective as of September 30, 2018, due to the existence of previously reported material weaknesses in Rules 13a-15(e)our internal control over financial reporting.

Notwithstanding a material weakness in internal control over financial reporting, our management concluded that our condensed consolidated financial statements in this quarterly report on Form 10-Q present fairly, in all material respects, the Company’s consolidated financial position, results of operations and 15d-15(e) undercash flows as of the Exchange Act)dates, and for the periods presented, in conformity with generally accepted accounting principles.
Description of Material Weakness as of December 31, 2017
As disclosed in further detail in “Part II - Item 9A - Controls and Procedures” of the 2017 Annual Report, we and our independent registered public accounting firm identified material weaknesses in our internal control over financial reporting - specifically, ineffective controls over accounting for income taxes and reverse acquisition accounting. These control deficiencies resulted in numerous adjustments and disclosures that were effective.

corrected prior to the issuance of our 2017 financial statements.

Remediation Plans
During our third quarter ended September 30, 2018, we continued to implement a remediation plan that addresses the material weaknesses in internal control over financial reporting through the following actions:
• Increased involvement on a quarterly basis of our third-party consultants dedicated to determining the appropriate accounting for material and complex tax and unique business transactions;
• Review of the tax accounting process to identify and implement enhanced processes and related internal control review procedures; and
• Adding additional review controls to approve complex accounting and related calculations.
58


Under the direction of the Audit Committee, management will continue to review and make necessary changes to the overall design of the Company’s internal control environment, as well as policies and procedures to improve the overall effectiveness of internal control over financial reporting.
We believe the measures described above will remediate the control deficiencies identified and will strengthen our internal control over financial reporting. As management continues to evaluate and work to improve internal control over financial reporting, we may take additional measures to address control deficiencies or determine to modify, or in appropriate circumstances not to complete, certain of the remediation measures described above. These controls must be in place and operating effectively for a sufficient period of time in order to validate the full remediation of the material weaknesses. We expect that the remediation of the material weaknesses will be complete as of December 31, 2018.
Changes in Internal Controls
As discussed in Note 2 to the condensed consolidated financial statements included in this quarterly report on Form 10-Q, the Company completed its acquisitions in December 2017, January 2018 and August 2018, respectively. During the most recently completed fiscal quarter,first and second quarters of 2018, we transitioned all of the business processes of Tyson and Acton, respectively, onto our existing platforms. We are continuing to integrate Acton and Tyson into our existing control procedures, but we do not expect changes to significantly affect our internal control over financial reporting. As permitted by interpretive guidance for newly acquired businesses issued by the SEC Staff, management has excluded the internal control over financial reporting of ModSpace from the evaluation of the Company's effectiveness of its disclosure controls and procedures as of September 30, 2018. Since the date of acquisition on August 15, 2018, ModSpace's financial results are included in the Company's condensed consolidated financial statements and constituted approximately $1.3 billion and $1.2 billion of total and net assets, respectively, as of September 30, 2018, and $65.5 million and $4.2 million of net revenues and net income, respectively, for the three months ended September 30, 2018. As part of our post-closing integration activities, we are engaged in the process of assessing the internal controls of ModSpace. The Company has begun to integrate policies, processes, people, technology and operations for the post-acquisition combined company, and it will continue to evaluate the impact of any related changes to internal control over financial reporting.
Other than the items discussed above, there has beenwere no changechanges in our internal control over financial reporting that hasoccurred during our quarter ended September 30, 2018 that materially affected or isare reasonably likely to materially affect, our internal control over financial reporting.

59


PART II – OTHER INFORMATION

Item

ITEM 1. Legal Proceedings.

None.

Proceedings
We are involved in various lawsuits, claims and legal proceedings that arise in the ordinary course of business. These matters involve, among other things, disputes with vendors or customers, personnel and employment matters, and personal injury. We assess these matters on a case-by-case basis as they arise and establish reserves as required. 
As of September 30, 2018, there were no material pending legal proceedings in which we or any of our subsidiaries are a party or to which any of our property is subject.

Item

ITEM 1A. Risk Factors.

Factors that could cause

As of September 30, 2018, there have been no material updates to our actual results to differ materially fromrisk factors since those in this report are any of the risks discloseddescribed in our Annual Report onRisk Factor in our Form 10-K10-Q for the yearperiod ended December 31, 2016, which wasJune 30, 2018 as filed with the SEC. In addition, information concerning additional risk factors related to the proposed Business Combination with Williams Scotsman are disclosed in the Company’s registration statement on Form S-4, as amended (File No. 333-220356) filed with the SEC on September 6, 2017. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.

Item


ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Use of Proceeds

Proceeds of $500,000,000 from the Public Offering and simultaneous sale of the Private Placement Warrants, including deferred underwriting compensation of $19,500,000, are held in the Trust Account at September 30, 2017. We paid $8,000,000 in underwriting discounts and incurred offering costs of approximately $795,000 related to the Public Offering. In addition, the Underwriters agreed to defer $19,500,000 in underwriting discounts, which amount will be payable when and if a Business Combination is consummated. There has been no material change in the planned use of proceeds from the Public Offering as described in our Prospectus dated September 10, 2015 which was filed with the SEC.

None.

Item

ITEM 3. Defaults Upon Senior Securities.

Securities

None.


Item

ITEM 4. Mine Safety Disclosures.

None.

21 

Disclosures

Not applicable.

Item

ITEM 5. Other Information.

Second Amendment to the Stock Purchase Agreement

On November 6, 2017, the Company entered into the Second Amendment to the Stock Purchase Agreement (the “Second Amendment”) with the Holdco Acquiror and the Sellers, which amends certain terms of the Stock Purchase Agreement to change the nature of the consideration paid by the Holdco Acquiror to include the shares of WSC Class B common stock that will be issued to the Sellers in connection with the business combination, update the exhibits thereto and make certain other technical changes.

The foregoing description of the Second Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the amendment, which is filed as Exhibit 2.3 to this report and is incorporated herein by reference.

Amended Equity Commitment Letter

On November 6, 2017, the Company entered into an amended equity commitment letter (the “Amended Commitment Letter”) with the TDR Investor, which amends certain terms of the Equity Commitment Letter to modify the TDR Investor’s original commitment to include the purchase of up to 10 million additional shares of WSC Class A common stock at a purchase price of $10.00 per share, which amount is dependent upon the aggregate dollar amount of redemptions at the closing of the business combination.

The foregoing description of the Amended Commitment Letter does not purport to be complete and is qualified in its entirety by reference to the full text of the amendment, which is filed as Exhibit 10.4 to this report and is incorporated herein by reference.

Information
None.


60


Item

ITEM 6. Exhibits.

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.

Exhibits
Exhibit
Number		Description
2.1Exhibit No.Stock Purchase Agreement among Double Eagle Acquisition Corp., Williams Scotsman Holdings Corp., Algeco Scotsman Global S.á r.l. and Algeco Scotsman Holdings Kft., dated as of August 21, 2017 (incorporated by reference to the corresponding exhibit to the Company’s Current Report on Form 8-K (File No. 001-37552), filed with the SEC on August 21, 2017).Exhibit Description
2.2Amendment to the Stock Purchase Agreement among Double Eagle Acquisition Corp., Williams Scotsman Holdings Corp., Algeco Scotsman Global S.á r.l. and Algeco Scotsman Holdings Kft., dated as of September 6, 2017 (incorporated by reference to the corresponding exhibit to the Company’s Registration Statement on Form S-4 (File No. 333-220356), filed with the SEC on September 6, 2017).
2.3Second Amendment to the Stock Purchase Agreement among Double Eagle Acquisition Corp., Williams Scotsman Holdings Corp., Algeco Scotsman Global S.á r.l. and Algeco Scotsman Holdings Kft., dated as of November 6, 2017 (incorporated by reference to the corresponding exhibit to Amendment No. 3 to the Company’s Registration Statement on Form S-4 (File No. 333-220356), filed with the SEC on November 6, 2017).
10.1Form of Williams Scotsman Corporation 2017 Incentive Award Plan (incorporated by reference to Exhibit 10.6 to Amendment No. 3 to the Company’s Registration Statement on Form S-4 (File No. 333-220356), filed with the SEC on November 6, 2017)).
10.2Amended and Restated Commitment Letter among Double Eagle Acquisition Corp., Bank of America, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Deutsche Bank AG, Canada Branch, Deutsche Bank AG Cayman Islands Branch, Deutsche Bank AG New York Branch, Deutsche Bank Securities Inc., Morgan Stanley Senior Funding, Inc., Goldman Sachs Lending Partners LLC, Credit Suisse AG, Credit Suisse Securities (USA) LLC and ING Capital LLC, dated as of October 4, 2017.
10.3Equity Commitment Letter between Double Eagle Acquisition Corp. and TDR Capital II Holdings L.P., dated as of August 21, 2017.
10.4Amended Equity Commitment Letter among Double Eagle Acquisition Corp. and TDR Capital II Holdings L.P., dated as of November 6, 2017.
31.1
*Certification of Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuantpursuant to Section 302 of the Sarbanes-Oxley Act of 2002.2002
31.2
*Certification of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuantpursuant to Section 302 of the Sarbanes-Oxley Act of 2002.2002
32.1
**Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuantpursuant to Section 906 of the Sarbanes-Oxley Act of 2002.2002
32.2
**Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuantpursuant to Section 906 of the Sarbanes-Oxley Act of 2002.2002
4.1
Warrant Agreement between WillScot Corporation and Continental Stock Transfer & Trust Company, dated as of August 15, 2018 (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K, filed August 16, 2018). 
10.1
Registration Rights Agreement between WillScot Corporation and each of the ModSpace Investors defined therein (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K filed August 16, 2018) 
10.2
Third Amendment to the ABL Credit Agreement, dated as of July 9, 2018, by and among Williams Scotsman International, Inc. (“WSII”), certain subsidiaries of WSII, Williams Scotsman Holdings Corp. (“Holdings”), the lenders party thereto, and Bank of America, N.A., as administrative agent and collateral agent (incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K filed August 16, 2018) 
10.3
Supplemental Indenture to be delivered in connection with the escrow merger dated as of August 15, 2018 between William Scotsman International, Inc. and Deutsche Bank Trust Company Americas as trustee (incorporated by reference to Exhibit 10.3 to the Company’s Form 8-K filed August 16, 2018) 
10.4
Supplemental Indenture to the 6.875% Senior Secured Notes due 2023 dated as of August 15, 2018 between William Scotsman International, Inc. and Deutsche Bank Trust Company Americas as trustee and collateral agent (incorporated by reference to Exhibit 10.4 to the Company’s Form 8-K filed August 16, 2018)
10.5
Supplemental Indenture to the 7.875% Senior Secured Notes due 2022 dated as of August 15, 2018 between William Scotsman International, Inc. and Deutsche Bank Trust Company Americas as trustee and collateral agent (incorporated by reference to Exhibit 10.5 to the Company’s Form 8-K filed August 16, 2018)
101.INSXBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document 
101.SCHXBRL Taxonomy Extension Schema Document
101.CALXBRL Taxonomy Extension Calculation Linkbase Document
101.DEFXBRL Taxonomy Extension Definition Linkbase Document
101.LABXBRL Taxonomy Extension Label Linkbase Document
101.PREXBRL Taxonomy Extension Presentation Linkbase Document

*Filed herewith

SIGNATURES

**Furnished (and not filed) herewith pursuant to Item 601(b)(32)(ii) of Regulation S-K under the Exchange Act

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Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

DOUBLE EAGLE ACQUISITION CORP.
WillScot Corporation
Date:
By:
/s/ TIMOTHY D. BOSWELL
Dated:November 9, 20172018 Timothy D. Boswell
/s/ Jeff Sagansky
Name: Jeff Sagansky
Title: President and Chief Executive Officer (principal executive officer)
/s/ James A. Graf
Name: James A. Graf
Title: Vice President, Chief Financial Officer and Treasurer (principal financial officer)(Principal Financial Officer)




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