UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934
For the year ended December 31, 2021
Commission File Number 001-39237
ATLAS CORP.
(Exact name of Registrant as specified in its Charter)
23 Berkeley Square
London, United Kingdom
W1J 6HE
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101 (b)(1). Yes ☐ No ☒
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101 (b)(7). Yes ☐ No ☒


Item A — Information Contained in this Form 6-K Report
This report on Form 6-K of Atlas Corp., or this Report, is hereby incorporated by reference into: the Registration Statement of Atlas Corp. filed with the Securities and Exchange Commission, (the “SEC”), on May 30, 2008 on Form F-3D (Registration No. 333-151329), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on March 31, 2011 on Form S-8 (Registration No. 333-173207), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on June 20, 2013 on Form S-8 (Registration No. 333-189493), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on April 24, 2012 on Form F-3 (Registration No. 333-180895), as amended on March 22, 2013 and February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on April 29, 2014 on Form F-3 (Registration No. 333-195571), as amended on March 6, 2017, April 19, 2017 and February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on November 28, 2014 on Form F-3 (Registration No. 333-200639), as amended on March 6, 2017, April 19, 2017 and February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on November 28, 2014 on Form S-8 (Registration No. 333-200640), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on March 12, 2015 on Form F-3D (Registration No. 333-202698), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on June 24, 2016 on Form S-8 (Registration No. 333-212230), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on August 25, 2017 on Form F-3 (Registration No. 333-220176), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on December 21, 2017 on Form S-8 (Registration No. 333-222216), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on April 13, 2018 on Form F-3D (Registration No. 333-224291), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on April 13, 2018 on Form F-3 (Registration No. 333-224288), as amended on May 3, 2018, May 7, 2018 and February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on September 28, 2018 on Form F-3 (Registration No. 333-227597), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on January 18, 2019 on Form F-3 (Registration No. 333-229312), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on March 27, 2019 on Form F-3 (Registration No. 333-230524), as amended on February 28, 2020, the Registration Statement of Atlas Corp. filed with the SEC on May 11, 2020 on Form F-3 (Registration No. 333-238178), as supplemented on December 7, 2020, the Registration Statement of Atlas Corp. filed with the SEC on June 30, 2020 on Form S-8 (Registration No. 333-239578), the Registration Statement of Atlas Corp filed with the SEC on March 19, 2021 on Form F-3 (Registration No. 333-254536), and the Registration Statement of Atlas Corp filed with the SEC on July 16, 2021 on Form F-3 (Registration No. 333-257967).

Seaspan Corporation Financial Information
Part I to this Report contains certain financial information of Seaspan Corporation, a wholly owned subsidiary of Atlas Corp., as of and for the year ended December 31, 2021.

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

ATLAS CORP.
Date: March 25, 2022
By:/s/ Graham Talbot
Graham Talbot
Chief Financial Officer
(Principal Financial and Accounting Officer)


INDEX


Unless we otherwise specify, when used in this Report, the terms “Seaspan”, the “Company”, “we”, “our” and “us” refer to Seaspan Corporation and its subsidiaries.


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholder and Board of Directors of
Seaspan Corporation:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Seaspan Corporation (the Company) as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive income, shareholder’s equity, and cash flows for each of the years in the three‑year period ended December 31, 2021, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the years in the three‑year period ended December 31, 2021, in conformity with U.S. generally accepted accounting principles.

Changes in Accounting Principles

As discussed in Note 2(q) to the consolidated financial statements, effective January 1, 2020, the Company adopted Accounting Standards Update (ASU) 2017-04, “Simplifying the Test for Goodwill Impairment”, which eliminates the need to determine the fair value of individual assets and liabilities of a reporting unit to measure the implied goodwill impairment. Our opinion is not modified with respect to this matter.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the Board and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgment. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Assessment of indicators of impairment for vessels

As discussed in Note 2(e) to the consolidated financial statements, property, plant and equipment that are held for use are evaluated for impairment when events or circumstances indicate that their carrying amounts may not be recoverable from future undiscounted cash flows. Examples of such events or changes in circumstances for vessels (“impairment indicators”) include, among others, a significant adverse change in the extent or manner in which the asset is being used or in its physical condition; a significant adverse change in legal factors or in the business climate that could affect the asset’s value, including an adverse action or assessment by a foreign government that impacts the use of the asset; or a current-period operating or cash flow loss combined with a history of operating or cash flow losses; or a projection or forecast that demonstrates continuing losses associated with the asset’s use. The determination of whether impairment indicators exist requires significant judgment in evaluating underlying significant assumptions including charter rates, utilization rates, operating costs and current vessel market values. The Company did not identify any indicators of impairment related to the vessels for the year ended December 31, 2021. As discussed in Note 5 and Note 6, the total carrying value of the Company’s vessels, including right of use vessels, was $7,297.1 million as of December 31, 2021.

We identified the assessment of indicators of impairment for vessels as a critical audit matter. A higher degree of subjective auditor judgment was required to assess the Company’s determination of whether an indicator of impairment existed, based on the Company’s evaluation of the significant assumptions. Changes in these significant assumptions could have changed the Company’s conclusion that no indicators of impairment were identified.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s impairment indicator assessment process. This included controls related to the identification and evaluation of indicators of impairment and underlying significant assumptions. We evaluated significant
1

assumptions used in the Company’s evaluation by comparing current charter rates to existing customer contracts and estimates of future charter rates to third-party industry publications for vessels with similar characteristics. We evaluated the Company’s anticipated future utilization rates and operating costs assumptions by comparing to the Company’s historical utilization rates and operating costs. For utilization rates, we also compared anticipated supply and demand conditions that would impact utilization to third party industry publications. We evaluated the Company’s assessment of current market values of vessels by comparing to recent vessel purchases and third-party industry publications


/s/ KPMG LLP


Chartered Professional Accountants


We have served as the Company’s auditor since 2000.


Vancouver, Canada
March 25, 2022
2

SEASPAN CORPORATION
Consolidated Balance Sheets
(Expressed in millions of United States dollars)
December 31, 2021 and 2020
December 31, 2021December 31, 2020
Assets
Current assets:
Cash and cash equivalents$169.0 $243.5 
Accounts receivable28.8 20.9 
Due from related party (note 3)38.3 19.5 
Prepaid expenses and other36.6 31.5 
Net investment in lease (note 4)16.8 10.7 
289.5 326.1 
Vessels (note 5)7,676.16,619.6
Right-of-use asset (note 6)720.4838.6 
Net investment in lease (note 4)741.5 418.6 
Goodwill75.375.3
Derivative instruments (note 17(c))49.0 19.2 
Other assets (note 7)270.6 186.9 
$9,822.4 $8,484.3 
Liabilities and shareholder's equity
Current liabilities:
Accounts payable and accrued liabilities $136.7 $88.9 
Deferred revenue44.726.3
Long-term debt - current (note 8)542.1321.7
Operating lease liabilities - current (note 9)153.8159.1
Other financing arrangements - current (note 10)100.564.1
Other liabilities - current 7.6 2.8 
985.4 662.9 
Long-term debt (note 8)3,480.9 3,025.0 
Operating lease liabilities (note 9)558.6 668.1 
Other financing arrangements (note 10)1,239.3 801.7 
Derivative instruments (note 17(c))66.568.9
Other liabilities 10.4 10.4 
Total liabilities6,341.1 5,237.0 
Shareholder's equity:
Share capital2.52.5
Additional paid in capital3,565.13,557.8
Deficit(67.2)(292.7)
Accumulated other comprehensive loss(19.1)(20.3)
3481.33247.3
$9,822.4 $8,484.3 
See accompanying notes to consolidated financial statements.
3

SEASPAN CORPORATION
Consolidated Statements of Operations
(Expressed in millions of United States dollars)
Years ended December 31, 2021, 2020 and 2019
202120202019
Revenue (note 14)$1,470.3 $1,230.8 $1,131.5 
Operating expenses:
Ship operating 289.3 243.4 229.8 
Depreciation and amortization307.9 288.1 254.3 
General and administrative42.4 29.7 33.1 
Operating leases (note 9)143.0 147.3 154.3 
Gain on disposal of vessels(15.9)— — 
Income related to modification of time charters— — (227.0)
766.7 708.5 444.5 
Operating earnings703.6 522.3 687.0 
Other expenses (income):
Interest expense178.8176.0218.9
Interest income(0.3)(1.4)(9.3)
Loss on debt extinguishment (note 8)127.0——
(Gain) loss on derivative instruments (note 17 (c))(5.7)31.5 35.1 
Other expenses9.3 2.8 3.2 
309.1208.9247.9
Net earnings$394.5 $313.4 $439.1 
See accompanying notes to consolidated financial statements.
4

SEASPAN CORPORATION
Consolidated Statements of Comprehensive Income
(Expressed in millions of United States dollars)
Years ended December 31, 2021, 2020 and 2019
202120202019
Net earnings $394.5 $313.4 $439.1 
Other comprehensive income:
Amounts reclassified to net earnings during the period
relating to cash flow hedging instruments (note 17(c))		1.21.31.0
Comprehensive income $395.7 $314.7 $440.1 

See accompanying notes to consolidated financial statements.
5

SEASPAN CORPORATION
Consolidated Statements of Shareholder's Equity
(Expressed in millions of United States dollars, except number of shares)
Years ended December 31, 2021, 2020 and 2019
Series D puttableNumber of Number of non-puttableNon-puttable Additional Accumulated otherTotal
preferred sharescommonpreferredCommon preferredpaid-incomprehensiveshareholder's
SharesAmountsharessharessharesshares capitalDeficitlossequity
Balance, December 31, 20181,986,449 $48.1 176,835,837 33,272,706 $1.4 0.3 $3,126.5 $(645.6)$(22.6)$2,460.0 
Impact of accounting policy change— — — — — — — 181.1 — 181.1 
Adjusted balance, December 31, 20181,986,449 48.1 176,835,837 33,272,706 1.4 0.3 3,126.5 (464.5)(22.6)2,641.1 
Net earnings— —— — — — — 439.1 — 439.1 
Other comprehensive income— —— — — — — — 1.0 1.0 
Exercise of puttable preferred shares(1,923,585)(47.7)— — — — — — — — 
Cancellation of put option on puttable preferred shares(62,864)(1.6)— 62,864 — — 1.6 — — 1.6 
Exercise of warrants — — 38,461,539 — 0.4 — 321.2 — — 321.6 
Fees and expenses in connection with issuance of Fairfax warrants— —— — — — (0.2)— — (0.2)
Dividends on common shares— —— — — — — (103.0)— (103.0)
Dividends on preferred shares — —— — — — — (70.4)— (70.4)
Accretion of preferred shares with holder put option— 1.2— — — — — (1.2)— (1.2)
Shares issued through dividend
reinvestment program		— —122,148 — — — 1.2 — — 1.2 
Share-based compensation expense— —257,799 — — — 2.6 (0.7)— 1.9 
Treasury shares— —(1,724)— — — — — — — 
Balance, December 31, 2019—$— 215,675,59933,335,570$1.8 0.3$3,452.9 $(200.7)$(21.6)$3,232.7 

See accompanying notes to consolidated financial statements.
6

SEASPAN CORPORATION
Consolidated Statements of Shareholder's Equity (Continued)
(Expressed in millions of United States dollars, except number of shares)
Years ended December 31, 2021, 2020 and 2019
 Number of
common
shares		Number of non-puttable
preferred
shares		Common
shares		Non-puttable
preferred
shares		Additional
paid-in
capital		DeficitAccumulated other
comprehensive
loss		Total
shareholder's equity
Balance, December 31, 2019215,675,599 33,335,570 $1.8 $0.3 $3,452.9 $(200.7)$(21.6)3,232.7 
Impact of accounting policy change (note 2(q)) — — — — — (2.3)— $(2.3)
Adjusted balance, December 31, 2019 215,675,599 33,335,570 1.8 0.3 3,452.9 (203.0)(21.6)3,230.4 
Net earnings — — — — — 313.4 — 313.4 
Other comprehensive income — — — — — — 1.3 1.3 
Capital contribution from Atlas  — — — — 100.0 — — 100.0 
Cancellation of preferred shares  33,335,570 (33,335,570)0.3 (0.3)— — — — 
Dividends on common shares — — — — — (389.7)— (389.7)
Dividends on preferred shares  — — — — — (16.8)— (16.8)
Shares issued through dividend
reinvestment program		 7,943 — — — 0.1 (0.1)— — 
Share-based compensation expense  162,910 — — — 4.8 (0.1)— 4.7 
Treasury shares 37,778 — 0.4 — — — — 0.4 
Deconsolidation of Atlas — — — — — 3.6 — 3.6 
Balance, December 31, 2020 249,219,800 — 2.5 — $3,557.8 $(292.7)$(20.3)$3,247.3 

See accompanying notes to consolidated financial statements.
7

SEASPAN CORPORATION
Consolidated Statement of Shareholder's Equity (Continued)
(Expressed in millions of United States dollars, except number of shares)
Years ended December 31, 2021, 2020 and 2019
Number of AdditionalAccumulated otherTotal
commonCommonpaid-incomprehensiveshareholder's
sharessharescapitalDeficitlossequity
Balance, December 31, 2020, carried forward249,219,800 $2.5 $3,557.8 $(292.7)$(20.3)$3,247.3 
Net earnings— — — 394.5 —394.5 
Other comprehensive income— ———1.21.2
Dividends on common shares— ——(169.0)—(169.0)
Share-based compensation expense (note 3)
— —7.3——7.3
Balance, December 31, 2021249,219,800 $2.5 $3,565.1 $(67.2)$(19.1)$3,481.3 

See accompanying notes to consolidated financial statements.


8

SEASPAN CORPORATION
Consolidated Statements of Cash Flows
(Expressed in millions of United States dollars)
Years ended December 31, 2021, 2020 and 2019

202120202019
Cash from (used in):
Operating activities:
Net earnings $394.5 $313.4 $439.1 
Items not involving cash:
Depreciation and amortization307.9 288.1 254.3 
Change in right-of-use asset123.9 118.6 111.8 
Non-cash interest expense and accretion34.9 37.5 38.4 
Unrealized change in derivative instruments(32.2)8.9 (20.0)
Amortization of acquired revenue contracts15.0 16.9 13.8 
Loss on debt extinguishment127.0 — — 
Gain on vessel disposal(15.9)— — 
Other5.07.2 1.5 
Changes in assets and liabilities:
Accounts receivable(30.8)(41.8)(2.3)
Net investment in lease14.9 13.3 9.3 
Prepaid expenses and other(5.3)(1.9)5.4 
Deferred dry-dock(38.7)(45.4)(22.3)
Other assets(9.3)(6.5)— 
Accounts payable and accrued liabilities44.9 5.2 11.5 
Deferred revenue18.1 6.5 (0.6)
Operating lease liabilities(120.5)(115.1)(111.9)
Derivative instruments26.6 22.5 55.0 
Cash from operating activities860.0 627.4 783.0 
Investing activities:
Acquisition of /additions to vessels, including vessels under construction(1,547.0)(806.7)(331.6)
Short-term investments— — 2.5 
Prepayment on vessel purchase(132.3)(40.2)(13.0)
Payment on settlement of interest swap agreements(26.8)(21.8)(126.8)
Other assets and liabilities38.1 (22.8)(6.7)
Capitalized interest relating to vessels under construction(15.7)— — 
Cash used in investing activities(1,683.7)(891.5)(475.6)
Financing activities:
Repayments of long-term debt and other financing arrangements(1,455.6)(770.9)(1,961.9)
Issuance of long-term debt and other financing arrangements3,148.3 1,108.5 1,227.3 
Redemption of Fairfax Notes(300.0)— — 
Payment to Atlas to settle Fairfax Exchange (note 3)(300.0)— — 
Repayment of promissory note payable to Atlas (note 3)(52.3)— — 
Issuance of senior unsecured Exchangeable Notes—201.3 — 
Purchase of capped call— (15.5)— 
Notes and warrants issued— 100.0 250.0 
Proceeds from exercise of warrants— — 250.0 
Redemption of preferred shares—— (47.7)
Financing fees(122.2)(26.4)(27.0)
Dividends on common shares(169.0)(369.9)(101.8)
Dividends on preferred shares— (16.8)(70.4)
Capital contribution from Atlas— 100.0 — 
Cash from/(used in) financing activities749.2 310.3 (481.5)
(Decrease) increase in cash and cash equivalents(74.5)46.2 (174.1)
Cash and cash equivalents and restricted cash, beginning of period243.5 197.3 371.4 
Cash and cash equivalents and restricted cash, end of period$169.0 $243.5 $197.3 

See accompanying notes to consolidated financial statements.

9

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
1.General:
Seaspan Corporation (“Seaspan” or the “Company”) was incorporated on May 3, 2005 in the Marshall Islands and owns and operates containerships pursuant to primarily long-term, fixed-rate time charters to major container liner companies.
In February 2020, Seaspan completed a holding company reorganization (the “Reorganization”) whereby Seaspan became a direct, wholly owned subsidiary of Atlas Corp. ("Atlas"). Pursuant to the Reorganization, common and preferred shareholders of Seaspan became common and preferred shareholders of Atlas, as applicable, on a one-for-one basis, maintaining the same number of shares and ownership percentage held in Seaspan immediately prior to the Reorganization. The Company’s common shares and preferred shares were cancelled and re-issued to Atlas as common shares. Atlas assumed all of Seaspan’s share purchase warrants and equity plans and will perform all relevant obligations.

2.Significant accounting policies:
(a)Basis of presentation:
These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the following accounting policies have been consistently applied in the preparation of the consolidated financial statements.
(b)Principles of consolidation:
The accompanying consolidated financial statements include the accounts of Seaspan Corporation and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated upon consolidation.
The Company also consolidates any variable interest entities (“VIEs”) of which it is the primary beneficiary. The primary beneficiary is the enterprise that has both the power to make decisions that most significantly affect the economic performance of the VIE and has the right to receive benefits or the obligation to absorb losses that in either case could potentially be significant to the VIE. The impact of the consolidation of these VIEs is described in note 10.
The Company accounts for its investment in companies in which it has significant influence by the equity method. The Company’s proportionate share of earnings is included in earnings and added to or deducted from the cost of the investment.
(c)Foreign currency translation:
The functional and reporting currency of the Company is the United States dollar. Transactions involving other currencies are converted into United States dollars using the exchange rates in effect at the time of the transactions. At the balance sheet date, monetary assets and liabilities that are denominated in currencies other than the United States dollar are translated into United States dollars using exchange rates at that date. Exchange gains and losses are included in net earnings.
(d)Cash equivalents:
Cash equivalents include highly liquid securities with terms to maturity of three months or less when acquired.
(e)Vessels:
Except as described below, vessels are recorded at their cost, which consists of the purchase price, acquisition and delivery costs, less accumulated depreciation.

1

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
2.Significant accounting policies (continued):
(e)     Vessels (continued):
Vessels purchased from the Company’s predecessor upon completion of the Company’s initial public offering in 2005 were initially recorded at the predecessor’s carrying value.
Vessels under construction include deposits, installment payments, interest, financing costs, transaction fees, construction design, supervision costs, and other pre-delivery costs incurred during the construction period.
Depreciation is calculated on a straight-line basis over the estimated useful life of each vessel, which is 30 years from the date of completion. The Company calculates depreciation based on the estimated remaining useful life and the expected salvage value of the vessel.
Vessels that are held for use are evaluated for impairment when events or circumstances indicate that their carrying amounts may not be recoverable from future undiscounted cash flows. Such evaluations include the comparison of current and anticipated operating cash flows, assessment of future operations and other relevant factors. If the carrying amount of the vessel exceeds the estimated net undiscounted future cash flows expected to be generated over the vessel’s remaining useful life, the carrying amount of the vessel is reduced to its estimated fair value.
(f)Dry-dock activities:
Classification rules require that vessels be dry-docked for inspection including planned major maintenance and overhaul activities for ongoing certification. The Company generally dry-docks its vessels once every five years. Dry-docking activities include the inspection, refurbishment and replacement of steel, engine components, electrical, pipes and valves, and other parts of the vessel. The Company uses the deferral method of accounting for dry-dock activities whereby capital costs incurred are deferred and amortized on a straight-line basis over the period until the next scheduled dry-dock activity.
(g)Goodwill:
Goodwill represents the excess of the purchase price of an acquired enterprise over the fair value assigned to assets acquired and liabilities assumed in a business combination. Goodwill is not amortized, but reviewed for impairment annually or more frequently if impairment indicators arise. When goodwill is reviewed for impairment, the Company may elect to assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. Alternatively, the Company may bypass this step and use a fair value approach to identify potential goodwill impairment and, when necessary, measure the amount of impairment. The Company uses a discounted cash flow model to determine the fair value of reporting units, unless there is a readily determinable fair market value.
(h)Deferred financing fees:
Deferred financing fees represent the unamortized costs incurred on issuance of the Company’s credit facilities and other financing arrangements and are presented as a direct deduction from the related debt liability when available. Amortization of deferred financing fees on credit facilities is provided on the effective interest rate method over the term of the facility based on amounts available under the facilities. Amortization of deferred financing fees on other financing arrangements is provided on the effective interest rate method over the term of the underlying obligation. Amortization of deferred financing fees is recorded as interest expense.
(i)Revenue:
The Company derives its revenue primarily from the charter of its vessels. Each charter agreement is evaluated and classified as an operating lease or financing lease based on the lease term, fair value associated with the lease and any purchase options or obligations. The assessment is done at lease commencement and reassessed only when a modification occurs that is not considered a separate contract.
Charters classified as operating leases include a lease component associated with the use of the vessel and a non-lease component related to vessel management. Total consideration in the lease agreement is allocated between the lease and non-lease components based on their relative standalone selling prices. For arrangements where the timing and pattern of transfer to the lessee is consistent between the lease and non-lease components and the lease component, if accounted for separately, would be classified as an operating lease, the Company has elected to treat the lease and non-lease components as a single lease component. Revenue is recognized each day the vessels are on-hire, managed and performance obligations are satisfied.


11

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
2. Significant accounting policies (continued):
(j)      Revenue (continued):
For charters that are classified as direct financing leases and sales-type leases, the present value of minimum lease payments and any unguaranteed residual value are recognized as net investment in lease. The discount rate used in determining the present values is the interest rate implicit in the lease. The lower of the fair value of the vessel based on information available at lease commencement date and the present value of the minimum lease payments computed using the interest rate implicit specific to each lease, represents the price, from which the carrying value of the vessel and any initial direct costs are deducted in order to determine the selling profit or loss.
For charters that are classified as direct financing leases, the unearned lease interest income including any selling profit and initial direct costs are deferred and amortized to income over the period of the lease so as to produce a constant periodic rate of return on the net investment in lease. Any selling loss is recognized at lease commencement date.
For charters that are classified as sales-type leases, any selling profit or loss is recognized at lease commencement date. Initial direct costs are expensed at lease commencement date if the fair value of the vessel is different from its carrying amount. If the fair value of the vessel is equal to its carrying amount, initial direct costs should be deferred and amortized to income over the term of the lease.
(j)Leases:
The Company is the lessee in certain of its vessel sale-leaseback transactions. Leases classified as operating leases are recorded as lease liabilities based on the present value of minimum lease payments over the lease term, discounted using the lessor’s rate implicit in the lease for each individual lease arrangement or the Company’s incremental borrowing rate, if the lessor’s implicit rate is not readily determinable. The lease term includes all periods covered by renewal and termination options where the Company is reasonably certain to exercise the renewal options or not to exercise the termination options. Corresponding right-of-use assets are recognized consisting of the lease liabilities, initial direct costs and any lease incentive payments.
Lease liabilities are drawn down as lease payments are made and right-of-use assets are depreciated over the term of the lease. Operating lease expenses are recognized on a straight-line basis over the term of the lease, consisting of interest accrued on the lease liability and depreciation of the right-of-use asset, adjusted for changes in index-based variable lease payments in the period of change.
Lease payments on short-term operating leases with lease terms of twelve months or less are expensed as incurred.
Transactions are determined to be sale-leaseback transactions when control of the vessel is transferred. For sale-leaseback transactions, where the Company is the seller-lessee, any gains or losses on sale are recognized upon transfer.
(k)Derivative financial instruments:
From time to time, the Company utilizes derivative financial instruments. All of the Company’s derivatives are measured at their fair value at the end of each period. Derivatives that mature within one year are classified as current. For derivatives not designated as accounting hedges, changes in their fair value are recorded in earnings.
The Company’s hedging policies permit the use of various derivative financial instruments to manage interest rate risk.
The Company had previously designated certain of its interest rate swaps as accounting hedges and applied hedge accounting to those instruments. By September 30, 2008, the Company de-designated all of the interest rate swaps it had accounted for as hedges to that date. Subsequent to their de-designation dates, changes in their fair value are recorded in earnings.
The Company evaluates whether the occurrence of any of the previously hedged interest payments are considered to be remote. When the previously hedged interest payments are not considered remote of occurring, unrealized gains or losses in accumulated other comprehensive income associated with the previously designated interest rate swaps are recognized in earnings when and where the interest payments are recognized. If such interest payments are identified as being remote, the accumulated other comprehensive income balance pertaining to these amounts is reversed through earnings immediately.
12

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
2. Significant accounting policies (continued):
(m)      Fair value measurement:
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e. the “exit price”) in an orderly transaction between market participants at the measurement date. The hierarchy is broken down into three levels based on the observability of inputs as follows:
•Level 1 — Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 instruments. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment.
•Level 2 — Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.
•Level 3 — Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
(n)     Share-based compensation:
The Company has granted restricted shares, phantom share units, restricted stock units and stock options to certain of its officers, members of management and directors as compensation. Upon completion of the Reorganization, Atlas assumed all of Seaspan’s share purchase warrants and equity plans and has and will perform all relevant obligations. Compensation cost is measured at the grant date fair values as follows:
•Restricted shares, phantom share units and restricted stock units are measured based on the quoted market price of the common shares on the date of the grant.
•Stock options exercisable into Atlas common shares are measured at fair value using the Black-Scholes model.
The fair value of each grant is recognized on a straight-line basis over the requisite service period. The Company accounts for forfeitures in share-based compensation expense as they occur.
(o) Use of estimates:
The preparation of consolidated financial statements requires management to make estimates and assumptions that affect the:
•reported amounts of assets and liabilities,
•disclosure of contingent assets and liabilities at the balance sheet dates and
•reported amounts of revenue and expenses during the reporting fiscal periods.
Areas where accounting judgments and estimates are significant to the Company and where actual results could differ from those estimates, include the:
•assessment of going concern;
•assessment of vessel useful lives;
•expected vessel salvage values;
•recoverability of the carrying value of vessels which are subject to future market events;
•carrying value of goodwill; and
•fair value of interest rate swaps, other derivative financial instruments.
(p)     Comparative information:
Certain information has been reclassified to conform to the financial statement presentation adopted for the current year.
(q)Recently adopted and future accounting pronouncements:
Measurement of credit loss
Effective January 1, 2020, the Company adopted Accounting Standards Update (“ASU”) 2016-13, “Measurement of Credit Loss on Financial Instruments”. ASU 2016-13 replaces the current incurred loss impairment methodology with the expected credit loss impairment model (“CECL”), which requires consideration of a broader range of reasonable and supportable information to estimate expected credit losses over the life of the instrument instead of only when losses are incurred. This standard applies to financial assets measured at amortized cost basis and investments in leases recognized by the lessor. Upon adoption, a cumulative effect adjustment of $2,293,000 was made to deficit as part of the modified retrospective transition approach.

13

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
2. Significant accounting policies (continued):
(q)    Recent accounting pronouncements:
Simplifying test for goodwill impairment
Effective January 1, 2020, the Company adopted ASU 2017-04, “Simplifying the Test for Goodwill Impairment”. ASU 2017-04 eliminates the need to determine the fair value of individual assets and liabilities of a reporting unit to measure the implied goodwill impairment. The goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The adoption of ASU 2017-04 did not have a material impact on the Company.
Discontinuation of LIBOR
The Company adopted ASU 2020-04, “Reference Rate Reform (Topic 848)”, prospectively to contract modifications. The guidance provides optional relief for the discontinuation of LIBOR resulting from rate reform. Contract terms that are modified due to the replacement of a reference rate are not required to be remeasured or reassessed under FASB’s relevant U.S. GAAP Topic. The election is available by Topic. The Company has elected to apply the optional relief for contracts under ASC 470, “Debt”, ASC 840 and 842, “Leases”, and ASC 815, “Derivatives and Hedging”. There was no impact to the Company's financial statements upon initial adoption. The LIBOR replacement modifications for Debt contracts will be accounted for by prospectively adjusting the effective interest rate in the agreements. Existing lease and derivative contracts will require no reassessments. Transition activities are focused on the conversion of existing LIBOR based contracts to the Secured Overnight Financing Rate.
Debt with conversion and other options
Effective January 1, 2022, the Company adopted ASU 2020-06, “Debt – Debt with Conversion and Other Options (Subtopic 470-20)”, using the modified retrospective method, whereby the accounting for convertible debt instruments is simplified by reducing the number of accounting models and circumstances when embedded conversion features are separately recognized. The adoption of this standard is not expected to have a material impact to the Company.
3.Related party transactions:
(a) The income or expenses with related parties relate to amounts paid to or received from individuals or entities that are associated with the Company or with the Company’s directors or officers and these transactions are governed by pre-arranged contracts.
(b) On each of February 14, 2018 and January 15, 2019, the Company issued to Fairfax $250,000,000 aggregate principal of 5.50% senior notes due on February 14, 2025 (“2025 Fairfax Notes”) and January 15, 2026 (“2026 Fairfax Notes”), respectively, and a tranche of warrants to purchase 38,461,539 common shares of Seaspan at an exercise price of $6.50 per share, on each date. On February 28, 2020, Seaspan issued to Fairfax, in a private placement, $100,000,000 aggregate principal amount of 5.50% senior notes due on March 1, 2027 (the “2027 Fairfax Notes” and together with the 2025 Fairfax Notes and the 2026 Fairfax Notes, the “Fairfax Notes”) (note 8(e)).
In June 2021, Atlas and Seaspan exchanged and amended the Fairfax Notes. Pursuant to this transaction, Atlas exchanged $200,000,000 aggregate principal amount of the 2026 Fairfax Notes and all $100,000,000 aggregate principal amount of the 2027 Fairfax Notes for (i) 12,000,000 Series J 7.00% Cumulative Redeemable Perpetual Preferred Shares of Atlas (the “Series J Preferred Shares”), representing total liquidation value of $300,000,000, and (ii) 1,000,000 five year warrants to purchase an equal number of Atlas common shares at an exercise price of $13.71 per share (the “Fairfax Exchange”) (note 8(e)). Subsequent to the Fairfax Exchange, Seaspan paid $300,000,000 to Atlas to settle the exchanged 2026 Fairfax Notes and 2027 Fairfax Notes and the notes were cancelled.
In connection with the Fairfax Exchange, the Fairfax Holders also agreed to amend the terms of the $300,000,000 aggregate principal amount of the Fairfax Notes that remained outstanding following the Fairfax Exchange (the “Amendment”), which included all $250,000,000 aggregate principal amount of the 2025 Fairfax Notes and $50,000,000 aggregate principal amount of the 2026 Fairfax Notes. The Amendment, among other things, eliminated the Fairfax Holders’ mandatory redemption and put rights and released and discharged all outstanding guarantees and liens on collateral thereunder. The Fairfax Holders also agreed to terminate Seaspan’s Amended and Restated Pledge and Collateral Agent Agreement and to release and discharge all liens on collateral thereof (note 8(e)). During the year ended December 31, 2021, the Company redeemed for cash the remaining 2025 Fairfax Notes and 2026 Fairfax Notes at a redemption price equal to 100% of the principal amount plus any accrued and unpaid interest.
For the year ended December 31, 2021, interest expense related to the Fairfax Notes, excluding amortization of the debt discount, was $19,204,000 (2020 - $32,114,000; 2019 - $26,927,000). For the year ended December 31, 2021, amortization of debt discount was $14,188,000 (2020 - $19,963,000; 2019 - $17,347,000).


14

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
3.Related party transactions (continued):
(c) In March 2021, Atlas entered into a joint venture with Zhejiang Energy Group (“ZE”) and executed a shareholders agreement with ZE to form the joint venture (“ZE JV”). Atlas owns 50% of the ZE JV. The purpose of the joint venture is to develop business in relation to container vessels, LNG vessels, environmental protection equipment and power equipment supply.
In October 2021, through as series of transactions with a wholly owned subsidiary of the ZE JV as the ultimate purchaser, Atlas sold one 4,250 TEU vessel for an aggregate purchase price of $38,280,000 (note 5). The Company continues to manage the ship operations of the vessel. During the year ended December 31, 2021, the Company earned revenue of $325,000 (2020 - $nil) and incurred expenses of $285,000 (2020 - $nil) in connection with the ship management of the vessel.
Transactions with Atlas Corp.
In March 2020, the Company received a capital contribution of $100,000,000 from Atlas.
On December 21, 2020, the Company issued $201,250,000 aggregate principal amount of 3.75% exchangeable senior unsecured notes due on December 15, 2025 in a private placement (the “Exchangeable Notes”). These notes are exchangeable into common shares of Atlas (note 8(f)).

Atlas grants restricted shares, restricted stock units and stock options to the Company’s employees under the Atlas Corp. Stock Incentive Plan (the “Atlas Plan”) (note 12). The value of the awards granted to the Company’s employees is considered a capital contribution from Atlas. During the year ended December 31, 2021, the Company recognized capital contribution in respect of such grants of $7,340,000 (2020 - $2,940,000).
The Company routinely makes payments for expenses on behalf of Atlas. As of December 31, 2021, amounts due from Atlas are non-interest bearing, unsecured and have no fixed repayment terms.
During the year ended December 31, 2021, the Company repaid an intercompany promissory note of $52,349,825 to Atlas in relation to the exchange of the Company's previously outstanding 7.125% senior unsecured notes due 2027 (note 8(d)).
During the year ended December 31, 2021, the Company declared dividends of $169,000,000 (2020 - $363,000,000) to Atlas. The Company makes dividend payments to Atlas on a quarterly basis to service Atlas’ payment of dividends to shareholders of its common and preferred shares and interest on Atlas' 7.125% senior unsecured notes due 2027.
The Company provides certain management services to Atlas in exchange for a management fee. For the period ended December 31, 2021, the management service revenue recognized from this arrangement was $9,927,000 (2020 - $8,029,000).
4.Net investment in lease:

December 31, 2021December 31, 2020
Undiscounted lease receivable$1,448.2 $773.2 
Unearned interest income(689.9)(343.9)
Net investment in lease$758.3 $429.3 

December 31, 2021December 31, 2020
Lease receivables $751.4 $429.3 
Unguaranteed residual value6.9 — 
Net investment in lease 758.3 429.3 
Current portion of net investment in lease (16.8)(10.7)
Long-term portion of net investment in lease $741.5 $418.6 

In February 2020, the bareboat charters for the six vessels acquired in November 2019 were modified to extend the terms of the leases by six years, with similar purchase options. As a result of the modification, it was determined that the customer is no longer reasonably certain to exercise the purchase options and these leases were reclassified as operating leases.

In February 2021, the Company commenced a fixed rate bareboat charter with a term of 18 years on a recently acquired 12,000 TEU vessel, which has been classified as a sales-type lease. No gain or loss was recognized on commencement date.


15

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
4.Net investment in lease (continued):
In September and November 2021, the Company commenced one and two 18-year fixed rate bareboat charters, respectively, each for a 12,200 TEU vessel. The bareboat charters have been classified as a sales-type lease and no gain or loss was recognized on the commencement dates.

At December 31, 2021, the undiscounted minimum cash flows related to lease receivable on direct financing leases are as follows:

2022$79.3 
202379.3
202479.5
202579.3
202679.3
Thereafter1051.5
$1,448.2 
5.Vessels:

December 31, 2021CostAccumulated
depreciation		Net book
value
Vessels$9,410.9 $(2,830.4)$6,580.5 
Vessels under construction1,095.6 — 1,095.6 
Total$10,506.5 $(2,830.4)$7,676.1 
December 31, 2020CostAccumulated
depreciation		Net book
value
Vessels$9,148.9 $(2,571.3)$6,577.6 
Vessels under construction42.0 — 42.0 
Total$9,190.9 $(2,571.3)$6,619.6 

During the year ended December 31, 2021, depreciation and amortization expense relating to vessels was $279,879,000 (2020 - $259,869,000; 2019- $233,729,000).
In February 2020, sales-type leases related to six bareboat charters were re-assessed to be operating leases at lease modification. Accordingly, vessels of $377,393,000 were reclassified to vessels and recorded at a value equal to the net investment in leases derecognized (note 4).
Upon commencement of a fixed rate bareboat charter in February 2021, $88,060,575 was reclassified to net investment in lease from vessels (note 4).

During the year ended December 31, 2020, the Company took delivery of ten secondhand vessels, with an aggregate purchase price of $785,033,000, including one vessel that was reclassified to net investment in leases at lease modification, subsequent to initial acquisition during the year.
During the year ended December 31, 2021, the Company took delivery of two secondhand 8,500 and two secondhand 15,000 vessels, for an aggregate purchase price of $358,500,000.
During the year ended December 31, 2021, the Company sold one 4,250 TEU vessel to a wholly owned subsidiary of the ZE JV for $38,280,000 (note 3), resulting in a gain on sale of $15,884,000.

Vessels under construction:
.As at December 31, 2021, the Company has 67 vessels under construction (December 31, 2020 – 5 vessels).
16

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
5.Vessels (continued):
Vessels under construction (continued):
As at December 31, 2021, the vessels under construction balance includes $18,870,000 of capitalized interest for the year ended December 31, 2021 (2020 – $nil).
During the year ended December 31, 2021, the Company took delivery of three 12,200 TEU vessels that were previously under construction for an aggregate purchase price of $251,895,000. The vessels commenced 18-year bareboat charters upon delivery and are classified as a sales-type lease (note 4)
6.Right-of-use assets:

December 31, 2021CostAccumulated amortizationNet book value
Vessel operating leases$1,066.6 $(350.0)$716.6 
Other operating leases9.4 (5.6)3.8 
Right-of-use assets$1,076.0 $(355.6)$720.4 
December 31, 2020CostAccumulated amortizationNet book value
Vessel operating leases$1,060.9 $(228.0)$832.9 
Other operating leases9.4 (3.7)5.7 
Right-of-use assets$1,070.3 $(231.7)$838.6 

During the year ended December 31, 2021, the change in right-of-use assets was $123,900,000 (2020 - $118,577,000; 2019 - $111,810,000).

7.Other assets:
December 31, 2021December 31, 2020
Intangible assets (a)
$65.2 $78.5 
Deferred dry-dock (b)
79.4 63.8 
Deferred financing fees on undrawn financings (c)
77.0—
Other49.044.6
Other assets270.6 186.9 

(a)Intangible assets

December 31, 2021CostAccumulated amortizationNet book value
Customer contracts$129.9 $(76.2)$53.7 
Other16.5 (5.0)11.5 
$146.4 $(81.2)$65.2 

December 31, 2020CostAccumulated amortizationNet book value
Customer contracts$129.9 $(58.6)$71.3 
Other11.5 (4.3)7.2 
$141.4 $(62.9)$78.5 
Intangible assets are primarily comprised of the acquisition date fair value of time charter contracts acquired. During the year ended December 31, 2021, the Company recorded $18,442,000 (2020 - $20,155,000; 2019 - $20,729,000) of amortization expense related to intangible assets.
Acquired customer contracts are amortized on a straight-line basis over their remaining useful lives. As of December 31, 2021, the weighted average useful lives of acquired customer contracts was 4 years (2020 - 5 years; 2019 - 5 years).
17

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
7.Other assets (continued):
(a)Intangible assets (continued):
Future amortization expense of intangible assets is as follows:

2022$17.0 
202313.3 
202410.5 
20256.6 
20263.0 
Thereafter14.8 
 $65.2 

(b) Deferred dry-dock

During the years ended December 31, 2021 and 2020, changes in deferred dry-dock were as follows:
December 31, 2019$41.3 
Costs incurred 45.2 
Amortization expensed (1)
(22.7)
December 31, 202063.8 
Costs incurred 40.0 
Amortization expensed (1)
(24.4)
December 31, 2021$79.4 
(1)Amortization of dry-docking costs is included in depreciation and amortization.

(c) Deferred financing fees on undrawn financings:

The Company has entered into financing arrangements for certain of its vessels under construction. As the financing arrangements are undrawn as at December 31, 2021, the amounts incurred have been capitalized and recorded as long-term asset. As the financing is drawn, the amounts will be reclassified and presented as a direct deduction from the related debt liability.


8.Long-term debt:

December 31, 2021December 31, 2020
Revolving credit facilities (a) (c)
$— $283.0 
Term loan credit facilities (b) (c)
2,128.6 2,355.6 
Senior unsecured notes (d)
1,250.0 80.0 
Fairfax Notes (e)
— 600.0 
Senior Unsecured Exchangeable Notes (f)
201.3 201.3 
Senior Secured Notes (g)
500.0 — 
4,079.9 3,519.9 
Fair value adjustment on term loan credit facilities (b)
— (0.1)
Debt discount on Fairfax Notes— (130.9)
Debt discount on Senior Unsecured Exchangeable Notes (5.1)(6.1)
Deferred financing fees(51.8)(36.1)
Long-term debt4,023.0 3,346.7 
Current portion of long-term debt(542.1)(321.7)
Long-term debt$3,480.9 $3,025.0 
18

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
8.Long-term debt (continued):
(a)Revolving credit facilities:
As at December 31, 2021, the Company had two revolving credit facilities available (December 31, 2020 – two revolving credit facilities) which provided for aggregate borrowings of up to $550,000,000 (December 31, 2020 – $450,000,000), of which $550,000,000 (December 31, 2020 - $167,000,000) was undrawn.
In May 2021, the Company amended and restated one revolving credit facility which increased the aggregate commitments by $100,000,000 and extended the maturity by two years.
Revolving credit facilities and Term loan credit facilities balances as at December 31, 2020 have been reclassified to conform to the financial statement presentation adopted for the current year.
As at December 31, 2021, the Company has no drawn revolving credit facilities. As at December 31, 2020 , the one month and three month average LIBOR on the Company’s revolving credit facilities was 0.0%, and 0.2%, respectively and the margins ranged between 0.0% and 2.3%. The weighted average rate of interest, including the margin, for the Company’s revolving credit facilities was 1.1% at December 31, 2021 (December 31, 2020 – 1.4%). Interest payments are made monthly, quarterly or semi-annually.

The Company is subject to commitment fees ranging between 0.5% and 0.6% (December 31, 2020 – 0.2% and 0.6%) calculated on the undrawn amounts under the various facilities.

(b)Term loan credit facilities:
As at December 31, 2021, the Company has entered into $3,838,853,000 (December 31, 2020 - $2,605,600,000) of term loan credit facilities, of which 1,710,224,000 (December 31, 2020 - $250,000,000) was undrawn. One of the term loan credit facilities has a revolving loan component which has been included in the revolving facilities.
In February 2020 and March 2020, the Company increased the aggregate commitment under an existing term loan credit facility (the “December 2019 Term Loan”) which matures on December 30, 2025, by $100,000,000.
On October 15, 2020, the Company entered into a sustainability-linked term loan facility (the “October 2020 Term Loan”) with an aggregate principal of $200,000,000, which was subsequently upsized to $250,000,000 on December 14, 2020. The facility matures on October 14, 2026 and bears an initial interest rate of three month LIBOR plus 2.25% margin. The margin may be subsequently adjusted if the Company meets certain sustainability metrics during the term of the loan.
The December 2019 Term Loan and the October 2020 Term Loan are secured by a portfolio of vessels, which also secured some of the Company’s other credit facilities.
In May 2021, the Company amended and restated three term loan credit facilities which increased the aggregate commitments by $79,540,000 and extended maturities by two years.
In June 2021, the Company made early prepayment of $59,961,000 on one term loan that matures on July 6, 2025.
In May 2021, the Company entered into a $6,500,000 term loan credit facility, which bears a fixed interest rate of 3.8% per annum and matures on May 30, 2024.
In July 2021, the Company entered into a $6,500,000 term loan credit facility, which bears a fixed interest rate of 3.8% per annum and matures on July 2, 2024.
In October 2021, the Company entered into a $633,088,000 term loan credit facility, which bears an initial interest rate of three month LIBOR plus 1.4% margin. No amounts have been drawn under the facility as of December 31, 2021.
In December 2021, the Company entered into a $1,077,137,000 term loan credit facility, which bears an initial interest rate of three month LIBOR plus 3.39% margin. No amounts have been drawn under the facility as of December 31, 2021.
Term loan credit facilities drawn mature between December 31, 2022 and January 21, 2030.
For the Company’s term loan credit facilities, except for one, interest is calculated on three month or six month LIBOR plus a margin per annum. The three month and six month average LIBOR was 0.2% and 0.2%, respectively (December 31, 2020 – 0.2% and 0.3%, respectively) and the margins ranged between 0.4% and 2.3% as at December 31, 2021 (December 31, 2020 – 0.4% and 4.3%).
For one of our term loan credit facilities with a total principal outstanding of $27,198,000 (December 31, 2020 - $39,970,000), interest is calculated based on the Export-Import Bank of Korea (KEXIM) rate plus 0.7% per annum.
For two of the term loan credit facilities with a total principal amount outstanding of $921,000,000 (December 31, 2020 – nil), interest is calculated based on a contractual rate of 3.8% per annum for both.

19

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
8.Long-term debt (continued):
(b) Term loan credit facilities (continued):
The weighted average rate of interest, including the applicable margin, was 1.8% at December 31, 2021 (December 31, 2020 – 2.0%) for term loan credit facilities. Interest payments are made in monthly, quarterly or semi-annual payments.

Repayments under term loan credit facilities are made in quarterly or semi-annual payments. For those related to newbuild containerships, payments commence three, six or thirty-six months after delivery of the associated newbuild containership, utilization date or the inception date of the term loan credit facilities.

The following is a schedule of future minimum repayments under our term loans credit facilities as of December 31, 2021:
2022$543.5 
2023268.2 
2024138.9 
2025136.1 
2026778.6 
Thereafter263.3 
$2,128.6 
(c)Credit facilities – other:
As of December 31, 2021, the Company’s credit facilities were secured by first-priority mortgages granted on 65 of its vessels, together with other related security. The security for each of the Company’s current secured credit facilities may include:
•A first priority mortgage on the collateral vessels funded by the related credit facility;
•An assignment of the Company’s time charters and earnings related to the related collateral vessels;
•An assignment of the insurance on each of the vessels that are subject to a related mortgage;
•An assignment of the Company’s related shipbuilding contracts and the corresponding refund guarantees;
•A pledge over shares of various subsidiaries; and
•A pledge over the related retention accounts.
As at December 31, 2021, 1,511,365,000 principal amount of indebtedness under the Company’s term loan and revolving credit facilities was secured by a portfolio of 52 vessels, the composition of which can be changed and is subject to a borrowing base and portfolio concentration requirements, as well as compliance with financial covenants and certain negative covenants.
The Company may prepay certain amounts outstanding without penalty, other than breakage costs in certain circumstances. A prepayment may be required as a result of certain events, including without limitation the sale or loss of a vessel, a termination or expiration of a charter (and the inability to enter into a replacement charter acceptable to lenders within a prescribed period of time). The amount that must be prepaid may be calculated based on the loan to market value. In these circumstances, valuations of the Company’s vessels are conducted on a “without charter” basis as required under the credit facility agreement.
Each credit facility contains a mix of financial covenants requiring the Company to maintain minimum liquidity, tangible net worth, interest and principal coverage ratios and/or debt to assets ratios, as defined.
Certain facilities are guaranteed by an intermediate parent entity, in which case the parent entity must meet certain consolidated financial covenants under those term loan facilities including maintaining certain minimum tangible net worth, cash requirements and debt-to-asset ratios.
Some of the facilities also have an interest and principal coverage ratio, debt service coverage and vessel value requirement for the subsidiary borrower. The Company was in compliance with these covenants as at December 31, 2021.
(d)Senior unsecured notes:

In February 2021, the Company issued $200,000,000 of 6.5% senior unsecured sustainability-linked bonds in the Nordic bond market (“2024 Bonds”). In April 2021, the Company issued a further $300,000,000 of senior unsecured sustainability-linked bonds in the Nordic bond market (the “2026 Bonds” and together with the 2024 Bonds, the “Bonds”). The Bonds mature in February 2024 and April 2026, respectively, and bear interest at 6.5% per annum. If the sustainability performance targets are not met during the term of the Bonds, the Bonds will be settled at maturity at 100.5% of the initial principal. The Bonds are listed on the Oslo Stock Exchange.

20

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
8.Long-term debt (continued):
(d) Senior unsecured notes (continued):
In May 2021, Atlas exchanged an aggregate principal amount of $52,198,825 7.125% senior notes due 2027 of Seaspan Corporation (the “Seaspan 2027 Notes”) for an equivalent amount of its 7.125% senior notes due 2027 (the “Atlas 2027 Notes”), registered under the Securities Act of 1933, as amended, and listed on the Nasdaq Global Market. In July 2021, Atlas exchanged an additional $151,000 of Seaspan 2027 Notes for Atlas 2027 Notes, following which the Company redeemed all remaining Seaspan 2027 Notes.

In July 2021, the Company issued $750,000,000 of senior unsecured notes. These notes mature in 2029 and accrue interest at 5.5% per annum, payable semi-annually beginning on February 1, 2022. The notes are a blue transition bond developed to further the Company’s sustainability efforts.

(e)Fairfax Notes:
Pursuant to the Fairfax Exchange, as described in note 3, Atlas exchanged $200,000,000 aggregate principal amount of the 2026 Fairfax Notes and all $100,000,000 aggregate principal amount of the 2027 Fairfax Notes for (i) 12,000,000 Series J Preferred Shares, representing total liquidation value of $300,000,000, and (ii) 1,000,000 five year warrants to purchase an equal number of Atlas common shares at an exercise price of $13.71 per share. Subsequent to the Fairfax Exchange, Seaspan paid $300,000,000 to Atlas to settle the exchanged 2026 Fairfax Notes and 2027 Fairfax Notes and the notes were cancelled.

In connection with the Fairfax Exchange, the Fairfax Holders also agreed to amend the terms of the $300,000,000 aggregate principal amount of the Fairfax Notes that remained outstanding following the Fairfax Exchange, which included all $250,000,000 aggregate principal amount of the 2025 Fairfax Notes and $50,000,000 aggregate principal amount of the 2026 Fairfax Notes. The Amendment, among other things, eliminated the Fairfax Holders’ mandatory redemption and put rights and released and discharged all outstanding guarantees and liens on collateral thereunder. The Fairfax Holders also agreed to terminate Seaspan’s Amended and Restated Pledge and Collateral Agent Agreement and to release and discharge all liens on collateral thereof.

In August 2021, the remaining 2025 Fairfax Notes and 2026 Fairfax Notes were redeemed for cash at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest. As a result of the Fairfax Exchange and subsequent redemptions, the Company recorded a loss on debt extinguishment of $121,715,000 for the year ended December 31, 2021, respectively (2020 – $nil; 2019 – $nil), representing the write-off of the existing associated debt discount and deferred financing fees.

(f)Senior Unsecured Exchangeable Notes:

In December 2020, the Company issued $201,250,000 aggregate principal amount of Exchangeable Notes in a private placement. The Exchangeable Notes are exchangeable at the holders’ option into an aggregate 15,474,817 Atlas common shares at an initial exchange price of $13.005 per share, in equivalent cash or a combination of Atlas common shares and cash, as elected by the Company, on or after September 15, 2020, or earlier in the following circumstances:
•After December 31, 2020, if the last reported price of an Atlas common share is at least 130% of the exchange price then in effect over a specified measurement period;
•If the trading price per $1,000 principal amount of Exchangeable Notes during a specified measurement period is less than 98% of the last reported sale price on Atlas common shares multiplied by the applicable exchange rate; and
•Upon the occurrence of certain significant corporate events, or in response to early redemption elected by the Company.

The exchange price is subject to anti-dilution and make-whole clauses.
The holders may require the Company to redeem the Exchangeable Notes held by them upon the occurrence of certain corporate events qualifying as a fundamental change in the business. The Company may redeem the Exchangeable Notes in connection with certain tax-related events or on any business day on or after December 20, 2023 and prior to September 15, 2025, if the last reported sale price of an Atlas common share is at least 130% of the exchange price during a specified measurement period. A redemption of the Exchangeable Notes is made at 100% of the principal amount, plus accrued and unpaid interest. The Exchangeable Notes mature on December 15, 2025, unless earlier exchanged, repurchased or redeemed.
Upon issuance, the proceeds from the Exchangeable Notes were allocated between debt, measured at fair value of $195,000,000, and the value of the embedded exchange feature, valued at $6,250,000. The difference between the face value and carrying value of the debt reflects the debt discount, which is amortized through interest expense using an effective interest rate of 4.5%, over the remaining life of the debt. Interest is payable semiannually in arrears on June 15 and December 15 of each year, beginning on June 15, 2021.




21

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
8. Long-term debt (continued):
(f) Senior Unsecured Exchangeable Notes (continued):

The embedded exchange feature is a derivative liability. This derivative liability is carried at fair value, remeasured at the end of each reporting period, with gains or losses on derivative instruments included in net earnings. The fair value of the embedded exchange feature derivative liability was $37,972,000 as of December 31, 2021.

Capped Call Transactions

In connection with the issuance of the Exchangeable Notes, the Company entered into capped call transactions with affiliates of certain of the initial purchasers of the Exchangeable Notes and other financial institutions, using $15,536,000 in proceeds from the issuance, to reduce the potential dilution to Atlas common shares upon any exchange of notes and/or offset any cash payments the Company is required to make upon exchange of the Exchangeable Notes, in excess of the principal amount. They may be settled in cash, shares, or a combination of cash and shares as determined by the settlement method of the Exchangeable Notes, at a strike price with underlying shares equal to that of the Exchangeable Notes and subject to anti-dilution adjustments substantially similar to those applicable to the Exchangeable Notes. The capped calls are exercisable up to a maximum price of $17.85 per share, subject to certain adjustments. The instruments expire on December 15, 2025.

The capped calls are carried at fair value as a derivative asset, remeasured at the end of each reporting period, with gains or losses on derivative instruments included in net earnings. The fair value of capped call derivative assets was $42,914,000 as of December 31, 2021.

(g) Senior Secured Notes:

In May 2021, the Company entered into a note purchase agreement to issue $500,000,000 of sustainability-linked, senior secured notes (the “Senior Secured Notes”) in a US private placement. The Senior Secured Notes comprise four series, each ranking pari passu with the Company’s existing and future debt financing program. The Series A, Series C and Series D Senior Secured Notes were issued in May 2021, with interest rates ranging from 3.91% to 4.26% and maturities from June 2031 to June 2036. The Series B Senior Secured Notes, which bear interest at 3.91% per annum and mature in 2031, were issued in August 2021. The Senior Secured Notes contain certain sustainability features and are subject to adjustment based on Seaspan’s achievements relative to certain key performance indicators.

9. Operating lease liabilities:
December 31,
2021		December 31,
2020
Operating lease commitments$785.1 $923.8 
Impact of discounting(103.5)(141.3)
Impact of changes in variable rates30.8 44.7 
Operating lease liabilities712.4 827.2 
Current portion of operating lease liabilities(153.8)(159.1)
Operating lease liabilities$558.6 $668.1 
Operating lease liabilities relate to vessel sale-leaseback transactions and other operating leases. Vessel sale-leaseback transactions under operating lease arrangements are, in part, indexed to three month LIBOR, reset on a quarterly basis. For one of the Company’s vessel operating leases, an option to repurchase the vessel exists at the end of its lease term. For all other arrangements, the lease may be terminated prior to the end of the lease term, at the option of the Company, by repurchasing the respective vessels on a specified repurchase date at a pre-determined fair value amount. For one of these arrangements, if the Company elects not to repurchase the vessel, the lessor may choose not to continue the lease until the end of its term. Each sale-leaseback transaction contains financial covenants requiring the Company to maintain certain tangible net worth, interest coverage ratios and debt-to-assets ratios, as defined. These vessels are leased to customers under time charter arrangements.

22

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
9. Operating lease liabilities (continued):
Operating lease costs related to vessel sale-leaseback transactions and other leases are summarized as follows:
December 31,December 31,
20212020
Lease costs:
  Operating lease costs$160.2 $163.2 
  Variable lease adjustments(13.7)(12.4)
Other information:
  Operating cash outflow used for operating leases143.2 147.4 
  Weighted average discount rate4.8 %4.8 %
  Weighted average remaining lease term6 years7 years

In September 2021, an amendment was made to extend the lease term on an existing lease for an additional five years. The amendment resulted in the continuation of its treatment as an operating lease. The reassessment due to the modification resulted in an increase of $5,753,000 to lease liabilities and a corresponding increase to right-of-use assets.

10.Other financing arrangements:
December 31, 2021December 31, 2020
Other financing arrangements$1,363.1 $879.5 
Deferred financing fees(23.3)(13.7)
Other financing arrangements1,339.8 865.8 
Current portion of other financing arrangements(100.5)(64.1)
Other financing arrangements$1,239.3 $801.7 
The Company, through certain of its wholly-owned subsidiaries, has entered into non-recourse or limited recourse sale-leaseback arrangements with financial institutions to fund the acquisition of vessels.
Under these arrangements, the Company has agreed to transfer the vessels to the counterparties and lease the vessels back from the counterparties over the applicable lease term as a financing lease. In the arrangements where the shipbuilding contracts are novated to the counterparties, the counterparties assume responsibility for the remaining payments under the shipbuilding contracts.
In certain of the arrangements, the counterparties are companies whose only assets and operations are to hold the Company’s leases and vessels. The Company operates the vessels during the lease term, supervises the vessels’ construction before the lease term begins, if applicable, and/or is required to purchase the vessels from the counterparties at the end of the lease term. As a result, in most cases, the Company is considered to be the primary beneficiary of the counterparties and consolidates the counterparties for financial reporting purposes. In all cases, these arrangements are considered failed-sales. The vessels are recorded as an asset and the obligations under these arrangements are recorded as a liability. The terms of the leases are as follows:

(i)COSCO Faith - 13100 TEU vessel:
Under this arrangement, the counterparty has provided financing of $109,000,000. The 12-year lease term began in March 2012, which was the vessel’s delivery date. Lease payments include an interest component based on three month LIBOR plus a 3.0% margin. At the end of the lease, the Company will have the option to purchase the vessel from the lessor for $1. In January 2020, the Company made a prepayment of $48,316,000 on the remaining balance of the arrangement.
(ii)Leases for three 4500 TEU vessels:
Under these arrangements, the counterparty has provided refinancing of $150,000,000. The five year lease terms began in March 2015. At delivery, the Company sold and leased the vessels back over the terms of the sale-leaseback transactions. At the end of the lease terms, the Company is obligated to purchase the vessels at a pre-determined purchase price. The remaining balance was paid in March 2020.
23

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
10.Other financing arrangements (continued):
(iii)Leases for five 11000 TEU vessels:
Under these arrangements, the counterparty has provided financing of $420,750,000. The 17-year lease terms began between August 2017 and January 2018, which were the vessels’ delivery dates. Lease payments include interest components based on three month LIBOR plus a 3.3% margin. At delivery, the Company sold and leased the vessels back over the term of the sale-leaseback transactions. At the end of the lease terms, the Company is obligated to purchase the vessels at a pre-determined purchase price. In October 2020, the Company made a prepayment of $71,084,000 on the remaining principal balance of one of the 11000 TEU vessels under sales-leaseback financing arrangement. In January 2021, the Company made a payment of $69,166,000 to early terminate a sale-leaseback financing arrangement secured by one 11,000 TEU vessel. In March 2021, the Company entered into a new sale-leaseback financing arrangement of $83,700,000, secured by the same 11,000 TEU vessel.
(iv)Leases for four 12000 TEU vessels:
Under these arrangements, the counterparty has provided refinancing of $337,732,000. The 10-year lease terms began in March and April 2020, which were the vessels’ delivery dates. Lease payments include interest components based on one month LIBOR plus a 2.75% margin. At delivery, the Company sold and leased the vessels back over the terms of the sale-leaseback transactions. At the end of the lease terms, the Company is obligated to purchase the vessels at a pre-determined purchase price.
(v)Leases for two 13000 TEU vessels:
Under these arrangements, the counterparty has provided refinancing of $138,225,000. The 10-year lease terms began in August and September 2020, which were the vessels’ delivery dates. Lease payments include interest components based on three month LIBOR plus a 2.75% margin. At delivery, the Company sold and leased the vessels back over the terms of the sale-leaseback transactions. At the end of the lease terms, the Company is obligated to purchase the vessels at a pre-determined purchase price.
(vi)Leases for two 12000 TEU vessels:
Under these arrangements, the counterparty has provided refinancing of $158,400,000. The 10-year and 12-year lease terms began in October and November 2020, respectively, which were the vessels’ delivery dates. Lease payments include interest components based on three month LIBOR plus a 2.75% margin. At delivery, the Company sold and leased the vessels back over the terms of the sale-leaseback transactions. The Company has the option to purchase the vessels throughout their respective lease terms at a pre-determined purchase price.
(vii)Leases for three vessels:
In April 2021, the counterparty provided refinancing of $235,000,000 in sale-leaseback financing for three vessels ranging in size between 10,000 TEU and 13,100 TEU. The lease terms, ranging between 96 and 162 months, began in April 2021. Lease payments include interest components based on one month LIBOR plus a 2.75% margin. The Company sold and leased the vessels back over the term of the sale-leaseback transactions. At the end of the lease term, the Company is obligated to purchase the vessels at a pre-determined purchase price. The Company has the option to purchase the vessels after the second anniversary date of delivery through their respective lease terms at a pre-determined purchase price.
(viii) Leases for three 12000 TEU vessels:
In April 2021, the counterparty provided sale-leaseback financing of $243,000,000. The 12-year lease term for one of the vessels began in November 2021, which was the vessel’s delivery date. The amounts drawn on this facility for the other two vessels relate to the vessel construction first installment. Lease payments include interest components based on one month LIBOR plus a 2.95% margin. At delivery, the Company sells and leases the vessels back over the term of the sale-leaseback transactions. At the end of the lease term, the Company is obligated to purchase the vessels at a pre-determined purchase price. The Company has the option to purchase the vessels after the second anniversary date of delivery through their respective lease terms at a pre-determined purchase price.
(ix)Leases for two 12000 TEU vessels:
In May 2021, the counterparty provided sale-leaseback financing of $162,000,000. The 10-year lease terms began in September and November 2021, which were the vessels’ delivery dates. Lease payments include interest components based on one month LIBOR plus a 2.95% margin. At delivery, the Company sold and leased the vessels back over the term of the sale-leaseback transactions. The Company has the option to purchase the vessels after the first anniversary date of delivery through their respective lease terms at a pre-determined purchase price.




24

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
10.Other financing arrangements (continued):
(x)Leases for six 7000 TEU vessels:
In October 2021, the counterparty provided sale-leaseback financing of $445,000,000. Lease payments include interest components based on one month LIBOR plus a 2.45% margin. At delivery, the Company will sell and lease the vessels back over the term of the sale-leaseback transactions. At the end of the lease term, the Company is obligated to purchase two of the vessels at a pre-determined purchase price. For all six vessels, the Company has the option to purchase the vessels after the first anniversary date of delivery through their respective lease terms at a pre-determined purchase price. At December 31, 2021, the amounts drawn on this facility relate to the first advance.
(xi)Leases for eight vessels:
In June 2021, the counterparty provided sale-leaseback financing of $895,520,000 for eight vessels ranging in size from 15500 TEU to 24000 TEU. Lease payments include interest components based on one month LIBOR plus a 2.80% margin. At delivery, the Company will sell and lease the vessels back over the term of the sale-leaseback transactions. The Company has the option to purchase the vessels after the second anniversary date of delivery through their respective lease terms at a pre-determined purchase price. At December 31, 2021, no amounts have been drawn under this facility.
(xii)Leases for six 15500 TEU vessels:
In August 2021, the counterparty provided sale-leaseback financing of $661,826,000. Lease payments include interest components based on one month LIBOR plus a 2.50% margin. At delivery, the Company will sell and lease the vessels back over the term of the sale-leaseback transactions. The Company has the option to purchase the vessels after the second anniversary date of delivery through their respective lease terms at a pre-determined purchase price. At December 31, 2021, no amounts have been drawn under this facility.
(xiii) Leases for six 15000 TEU and four 7000 TEU vessels:
In November 2021, the counterparty provided sale-leaseback financing of $889,000,000. Lease payments include interest components based on one month LIBOR plus a 2.45% margin. At delivery, the Company will sell and lease the vessels back over the term of the sale-leaseback transactions. The Company has the option to purchase the vessels after the first anniversary date of delivery through their respective lease terms at a pre-determined purchase price. At December 31, 2021, no amounts have been drawn under this facility.
(xiv) Leases for two 12000 TEU vessels
In December 2021, the Company entered into a $169,500,000 financing arrangement to finance two vessels upon delivery. Lease payments include interest components based on a secured overnight financing rate plus a credit spread and a 1.8% margin. No amounts have been drawn under the financing as of December 31, 2021.
In May 2021, the Company repaid $59,300,000 upon early termination of a sale-leaseback financing arrangement secured by a 13,100 TEU vessel.
The weighted average rate of interest, including the margin, was 3.08% at December 31, 2021 (2020 – 3.12%).

Based on amounts funded, payments due to the counterparties are as follows:

2022$101.0 
2023101.4 
2024102.6 
202597.4 
202694.2 
Thereafter866.5 
 $1,363.1 
25

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)
Years Ended December 31, 2021, 2020 and 2019

11.Share Capital:
On February 27, 2020, the Company completed a Reorganization whereby it became a wholly owned subsidiary of Atlas, a newly formed entity, to establish a holding company structure. Holders of the Company’s common and preferred shares became holders of Atlas common and preferred shares, as applicable, on a one-for-one basis, maintaining the same number of shares, ownership percentage and associated rights and privileges as they held of Seaspan immediately prior to the Reorganization. The Company’s common shares and preferred shares were cancelled and re-issued to Atlas as common shares. All outstanding common shares held in treasury were cancelled. In addition, as part of the Reorganization, the Company's warrants were assumed by Atlas pursuant to an assignment and assumption agreement and are now exercisable for Atlas common shares.
The Company has 425,000,100 common shares and 150,000,000 preferred shares authorized with par value $0.01 per share at December 31, 2021.

26

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019

12.Share-based compensation:
In December 2005, Seaspan’s board of directors adopted the Seaspan Corporation Stock Incentive Plan, which was administered by Seaspan’s board of directors and, under which its officers, employees and directors could be granted options, restricted shares, phantom share units and other stock-based awards as determined by the Seaspan board of directors. Upon consummation of the Reorganization, Atlas assumed Seaspan’s equity-based compensation plans, including the Seaspan Corporation Stock Incentive Plan, which was amended and restated as the Atlas Corp. Stock Incentive Plan. Awards previously granted under the Seaspan Corporation Incentive Plan are now exercisable for Atlas common shares instead of Seaspan common shares. Any future share-based compensation granted to the Company’s employees will be issued through the Atlas Plan.
Restricted sharesPhantom share unitsRestricted stock unitsStock options
NumberW.A. grantNumberW.A. grantNumberW.A. grantNumberW.A. grant
of sharesdate FVof unitsdate FVof unitsdate FVof optionsdate FV
December 31, 201885,742$7.28 567,002$12.97 584,771$7.91 500,000$2.45 
Granted67,4008.15——249,7328.90——
Vested or exchanged(85,742)7.28(60,001)16.68(224,073)8.59——
Cancelled————(33,466)9.05——
December 31, 201967,400$8.15 507,001$12.53 576,964$8.01 500,000$2.45 
Granted51,49213.41——1,824,7867.831,500,0002.57
Vested or exchanged(67,400)8.15(20,000)6.85(313,231)9.32——
Cancelled(51,492)13.41——(79,635)9.84——
December 31, 2020—$— 487,001$12.76 2,008,884$7.57 2,000,000$2.51 
Granted—— —— 807,27713.44——
Vested or exchanged—— —— (322,100)10.22——
Cancelled—— —— (27,333)12.14——
December 31, 2021—$— 487,001$12.76 2,466,728$9.10 2,000,000$2.51 
Vested and excercisable, December 31, 2021—$— 487,001$12.76 —$— 600,000$2.55 

(a)Restricted stock units:

The restricted stock units generally vest over two or five years, in equal tranches. Upon vesting of the restricted stock units, the participant will receive common shares.

During the year ended 2021, the Company granted certain executive officers and members of management 807,277 restricted stock units. The restricted stock units vest in five tranches annually beginning on January 3, 2022 and have a grant date fair value of 13.44 per unit.





27

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019


13.Other information:

(a)Accounts payable and accrued liabilities:
The principal components of accounts payable and accrued liabilities are:
20212020
Accrued interest$41.8$15.5 
Accounts payable and other accrued liabilities94.973.4 
$136.7 $88.9 
(b)Supplemental cash flow information:
202120202019
Interest paid$136.5 $142.6 $183.1 
Interest received0.4 1.5 8.9 
Undrawn credit facility fee paid1.9 0.5 1.7 
Non-cash investing and financing transactions:
Dividend reinvestment— 0.1 1.2 
Non-cash dividend to Atlas— 20.0 — 
Payment to the shipbuilders by the financing company180.0 — — 
Commencement of sales-type lease343.9 57.0 316.7 
Reclassification on lease modification— 377.4 — 
Refinancing of existing term loan credit facilities with draws made on the new debt— — 302.7 
Change in right-of-use assets and operating lease liabilities5.8 — — 
Prepayments transferred to vessels upon vessel delivery12.7 46.8 — 
Interest capitalized on vessels under construction18.9 — — 
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the amounts shown in the consolidated statements of cash flows:
202120202019
Cash and cash equivalents$169.0 $243.5 $195.0
Restricted cash included in prepaid and other——2.3
Total cash, cash equivalents and restricted cash$169.0 $243.5 197.3


14.Revenue:
For the year ended December 31, 2021, 2020, and 2019, revenue consists of:
202120202019
Time charter revenue$1,409.9 $1,180.0 $1,096.0 
Interest income from leasing46.1 40.5 35.5 
Other14.3 10.3 — 
$1,470.3 $1,230.8 $1,131.5 

In March 2019, the Company entered into an agreement with a customer to modify seven time charters such that the charters terminated effective March 31, 2019, subsequent to which the vessels were re-chartered to other customers. Pursuant to this agreement, the Company received a settlement payment of $227,000,000, which was recorded in income related to modification of time charters.

28

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
14.Revenue (continued):

At December 31, 2021, the minimum future revenues to be received on committed operating leases and interest income to be earned from direct financing leases are as follows:
Operating lease (1)
Finance lease (2)
Total committed revenue
2022$1,474.3 $63.5 $1,537.8 
20231,406.1 61.0 1,467.1 
20241,180.0 58.2 1,238.2 
2025806.8 55.2 862.0 
2026463.3 53.1 516.4 
Thereafter344.7 393.1 737.8 
$5,675.2 $684.1 $6,359.3 
1.Minimum future operating lease revenue includes payments from signed charter agreements that have not yet commenced.
2.Minimum future interest income includes direct financing leases currently in effect.

Minimum future revenues assume 100% utilization, extensions only at the Company’s unilateral option and no renewals.

15.Commitments and contingencies:
(a)Operating leases:

As at December 31, 2021, the commitment under operating leases for vessels is $780,745,000 for the years from 2022 to 2029 and for other operating leases is $4,318,000 for the years from 2021 to 2024. Total commitments under these leases are as follows:

2022$143.6 
2023146.4 
2024150.1 
2025126.4 
2026111.5 
Thereafter107.1 
 $785.1 
For operating leases indexed to three month LIBOR, commitment under these leases are calculated using the LIBOR in place as at December 31, 2021 for the Company.

(b) Vessel commitment:

As at December 31, 2021, the Company had entered into agreements to acquire 67 vessels (December 31, 2020 – five vessels).

The Company has outstanding commitments for installment payments as follows:

20221,103.2 
20232,712.5 
20242,457.8 
Total $6,273.5 






29

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019
16.Concentrations:
The Company’s revenue is derived from the following customers:

202120202019
COSCO$492.2 $401.1 $407.4 
Yang Ming Marine249.9 255.7 257.5 
ONE255.2 237.3 199.4 
Other473.0 336.7 267.2 
$1,470.3 $1,230.8 $1,131.5 

17.Financial instruments:

(a)Fair value:
The carrying values of cash and cash equivalents, short-term investments, restricted cash, accounts receivable, accounts payable and accrued liabilities approximate their fair values because of their short term to maturity.
As of December 31, 2021, the fair value of the Company’s revolving credit facilities and term loans excluding deferred financing fees was $2,113,824,000 (December 31, 2020 - $2,599,197,000) and the carrying value was $2,128,629,000 (December 31, 2020 - $2,638,522,000). As of December 31, 2021, the fair value of the Company’s other financing arrangements, excluding deferred financing fees, was $1,419,508,000 (December 31, 2020 - $891,710,000) and the carrying value was $1,363,098,000 (December 31, 2020 - $879,468,000). The fair value of the revolving and term loan credit facilities and other financing arrangements, excluding deferred financing fees, are estimated based on expected principal repayments and interest, discounted by relevant forward rates plus a margin appropriate to the credit risk of the Company. Therefore, the Company has categorized the fair value of these financial instruments as Level 2 in the fair value hierarchy.

As of December 31, 2021, the fair value of the Company’s senior unsecured notes was $1,291,476,000 (December 31, 2020 – $89,207,000) and the carrying value was $1,250,000,000 (December 31, 2020 – $80,000,000). The fair value of the Company’s Exchangeable Notes was $209,566,000 (December 31, 2020 - $195,232,000) and the carrying value was $201,250,000 (December 31, 2020 - $201,250,000) or $196,177,000 (December 31, 2020 - $195,000,000), net of debt discount. The fair value of the Company’s Senior Secured Notes was $456,875,000 and the carrying value was $500,000,000. The fair value is calculated using the present value of expected principal repayments and interest discounted by relevant forward rates plus a margin appropriate to the credit risk of the Company. As a result, these amounts are categorized as Level 2 in the fair value hierarchy.

The Company’s interest rate derivative financial instruments are re-measured to fair value at the end of each reporting period. The fair values of the interest rate derivative financial instruments have been calculated by discounting the future cash flow of both the fixed rate and variable rate interest rate payments. The discount rate was derived from a yield curve created by nationally recognized financial institutions adjusted for the associated credit risk. The fair values of the interest rate derivative financial instruments are determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets. Therefore, the Company has categorized the fair value of these derivative financial instruments as Level 2 in the fair value hierarchy.

The exchange feature embedded in the Exchangeable Notes and capped calls entered into in connection with the Exchangeable Notes are derivatives measured at fair value at the end of each reporting period. The embedded exchange feature derivative is measured at fair value using a partial differential equation, with a Monte Carlo model for certain features. The capped call derivative is measured at fair value using a binomial tree. These models utilize observable and unobservable market data, including stock price, expected volatility, risk-free interest rate and expected dividend yield, as applicable. The embedded exchange feature and capped call derivatives are classified as Level 3 as the Company uses expected volatility that is unobservable and significant to the valuation. In general, an increase in Atlas’s stock price or stock price volatility will increase the fair value of the embedded exchange feature and capped call derivatives which will result in an increase in loss and gain, respectively. As time to the expiration of the derivatives decreases, the fair value of the derivatives will decrease. The volatilities used as of December 31, 2021, for the embedded exchange feature were 44.40% and 41.19% for the capped call. The fair value of the embedded exchange feature and capped calls resulting from a change in volatility are included below.
10% increase in volatility10% decrease in volatility
Embedded exchange feature$44.2 $31.4 
Capped calls48.1 34.8 
Unobservable inputs for recurring and non-recurring Level 3 disclosures are obtained from third parties whenever possible and reviewed by the Company for reasonableness.
30

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019

17.Financial instruments (continued):

(b) Interest rate swap derivatives:

The Company uses interest rate derivative financial instruments, consisting of interest rate swaps, to manage its interest rate risk associated with its variable rate debt. If interest rates remain at their current levels, the Company expects that $16,818,000 would be settled in cash in the next 12 months on instruments maturing after December 31, 2021. The amount of the actual settlement may be different depending on the interest rate in effect at the time settlements are made.
As of December 31, 2021, the Company had the following outstanding interest rate derivatives:
Fixed per annum rate
swapped for LIBOR		Notional amount as of
December 31, 2021
Maximum notional
amount(1)
Effective dateEnding date
5.4200%$269.6 $269.6 September 6, 2007May 31, 2024
1.6490%160.0 160.0 September 27, 2019May 14, 2024
0.7270%125.0 125.0 March 26, 2020March 26, 2025
1.6850%110.0 110.0 November 14, 2019May 15, 2024
0.6300%92.0 92.0 January 21, 2021October 14, 2026
0.6600%92.0 92.0 February 4, 2021October 14, 2026
1.4900%26.9 26.9 February 4, 2020December 30, 2025
(1)Over the term of the interest rate swaps, the notional amounts increase and decrease. These amounts represent the peak notional amount over the remaining term of the swap.

(c) Financial instruments measured at fair value:
The following provides information about the Company’s derivatives:
20212020
Derivative assets
  Interest rate swaps$6.1 $— 
  Capped call derivative asset42.9 19.2 
Derivative liabilities
  Interest rate swaps28.5 63.0 
  Derivative embedded exchange feature38.0 5.9 
There are no amounts subject to the master netting arrangements in 2021 or 2020.
The following table provides information about gains and losses included in net earnings and reclassified from accumulated other comprehensive loss (“AOCL”) into earnings:
202120202019
(Gain) loss recognized in net earnings:
(Gain) loss on interest rate swaps(1)
$(14.0)$36.4 $58.8 
(Gain) loss on derivative put instrument(0.1)(0.9)(23.7)
(Gain) loss on capped call derivative asset(23.6)(3.7)— 
(Gain) loss on derivative embedded exchange feature32.0 (0.3)— 
Loss reclassified from AOCL to net earnings(2)
Interest expense0.2 0.3 0.3 
Depreciation and amortization1.0 1.0 0.7 
(1)For the years ended December 31, 2021, 2020 and 2019, cash flows related to actual settlement of interest rate swaps were $26,758,000, $21,789,000, and $126,782,000. These are included in investing activities on the consolidated statements of cash flows.
(2)The effective portion of changes in unrealized loss on interest rate swaps was recorded in accumulated other comprehensive loss until September 30, 2008 when these contracts were voluntarily de-designated as accounting hedges. The amounts in accumulated other comprehensive loss are recognized in earnings when and where the previously hedged interest is recognized in earnings.

The estimated amount of AOCL expected to be reclassified to net earnings within the next 12 months is approximately $1,019,000.


31

SEASPAN CORPORATION
Notes to Consolidated Financial Statements
(Tabular amounts in millions of United States dollars, except per share amount and number of shares)

Years Ended December 31, 2021, 2020 and 2019

18.Subsequent events:

(a)On January 3, 2022, the Company declared dividends of $47,500,000 on its common shares to Atlas, which was paid on January 24, 2022.
(b)In January 2022, the Company exercised its option under an existing lease financing arrangement to purchase one 10,000 TEU vessel. The purchase is expected to complete in January 2023 at the pre-determined purchase price of $52,690,000.
(c)In January 2022, the Company entered into an interest rate swap with a notional amount of $500,000,000. The swap has a 10-year term and the Company pays a fixed rate of 1.925% and receives a floating rate based on three month LIBOR.
(d)In February 2022, the Company sold one 4,250 TEU vessel for an aggregate purchase price of $32,750,000. The Company continues to manage the ship operations of the vessel.
(e)In February 2022, the Company entered into a $250,000,000 3-year sustainability-linked unsecured revolving credit facility (the “2022 RCF”). The 2022 RCF replaces the Company’s $150,000,000 2-year unsecured revolving credit facility and bears interest at market rate.


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ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

The following should be read in conjunction with the unaudited consolidated financial statements and related notes included in this Report and the audited consolidated financial statements and related notes for the year ended December 31, 2021 filed with the U.S. Securities and Exchange Commission on an Atlas Corp. Form 6-K. Unless otherwise indicated, all amounts are presented in U.S. dollars, or USD. We prepare our consolidated financial statements in accordance with U.S. GAAP.

Overview
General
Seaspan was incorporated on May 3, 2005, in the Republic of the Marshall Islands. Seaspan is a leading independent charter owner and manager of containerships, which we charter primarily pursuant to long-term, fixed-rate time charters with major container liner companies. We primarily deploy our vessels on long-term, fixed-rate time charters to take advantage of the stable cash flow and high utilization rates that are typically associated with long-term time charters. As of March 10, 2022, we operated a fleet of 132 vessels that have an average age of approximately eight years, on a TEU weighted basis. 
Customers for our operating fleet as at March 10, 2022 are as follows:

Customer for Current FleetNumber of vessels under charterTEUs under charter
CMA CGM17160,950
COSCO28243,750
Hapag-Lloyd14114,350
Maersk2090,500
MSC9103,600
ONE23194,550
Yang Ming Marine15210,000
ZIM630,600

Our primary objective for Seaspan is to continue to grow our containership leasing business through accretive vessel acquisitions as market conditions allow. Most of our customers’ containership business revenues are derived from the shipment of goods from the Asia Pacific region to various overseas export markets in the United States and in Europe.
We use the term “twenty-foot equivalent unit”, or TEU, the international standard measure of containers, in describing the capacity of our containerships, which are also referred to as our “vessels”.
The following table summarizes key facts regarding Seaspan’s fleet as of December 31, 2021:

Vessel Class
(TEU)		# Vessels (Total Fleet)# Vessels (of which are unencumbered)Average Age (Years)(7)Average Remaining Charter Period (Years)(1)(7)Average Daily Charter Rate (in thousands of USD)Days Off-Hire(5)Total Ownership Days(6)
2500-350014613.62.422.3995110
4250-5100322114.53.021.241311982
8500-9600(2)18311.94.153.476315
10000-11000(3)3346.25.832.18012045
12000-13100(4)1906.77.042.496002
14000+1725.84.248.065878
Total/Average133368.25.034.861447,332

(1)Excludes options to extend charter.
(2)Includes 3 vessels on bareboat charter.
(3)Includes 8 vessels on bareboat charter.
(4)Includes 1 vessel on bareboat charter.
(5)Days Off-Hire includes scheduled and unscheduled days related to vessels being off-charter during the year ended December 31, 2021.
(6)Total Ownership Days for the quarter ended December 31, 2021 includes time charters and bareboat charters and excludes days prior to the initial charter hire date.
(7)Averages shown are weighted by TEU

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Significant Developments During the Year ended December 31, 2021
Shipbuilding Contracts for Newbuild Containerships
Commencing in December 2020 through to December 2021, Seaspan entered into agreements with shipyards to build 70 newbuild containerships, three of which were delivered in 2021. The remaining 67 vessels to be delivered are summarized in the table

NewbuildsTotal TEUMonth Acquired
12200 TEU224,400December 2020
24000 TEU248,000February 2021
15000 TEU LNG10150,000February 2021
12000 TEU448,000February 2021
15000 TEU460,000February 2021
16000 TEU9144,000March 2021
15500 TEU693,000March 2021
12000 TEU224,000June 2021
15000 TEU345,000June 2021
7000 TEU LNG15105,000July and September 2021
7000 TEU1070,000August 2021
Total67811,400
These vessels will commence long-term charters with leading global liner companies, some of which are subject to vessel purchase options or obligations at the conclusion of their respective charters.
Vessel Acquisitions and Deliveries
During the year ended December 31, 2021, we took delivery of seven vessels. The additions to our fleet are summarized below.
VesselYear BuiltVessel Class
(TEU)		Purchase price (in millions of US dollars) Delivery
Date
Mediterranean Bridge20108500$52.3 April 2021
Gulf Bridge2010850052.3May 2021
CMA CGM Chile201915000127.0May 2021
CMA CGM Mexico201915000127.0July 2021
MSC Carole20211220084.0September 2021
MSC Alanya20211220084.0November 2021
MSC Rayshmi20211220084.0November 2021

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Vessel sales

On October 29, 2021, the Company sold one 4,250 TEU vessel for an aggregate purchase price of $38.3 million. Through a series of transactions, the vessel was ultimately purchased by a wholly owned subsidiary of Zhejiang Energy Atlas Marine Technology Co., Ltd, which is 50% owned by Atlas. Seaspan continues to manage the ship operations of the vessel.

In December 2021, we entered into agreements to sell six 4,250 TEU vessels for an aggregate $186.8 million. Three of the vessels will ultimately be purchased by subsidiaries of the ZE JV and three of the vessels are being purchased by a liner customer. One sale completed in February 2022 for gross proceeds of $32.8 million. We continue to manage the ship operations of this vessel. The remaining five vessel sales are expected to complete in the second quarter of 2022, subject to closing conditions.
Atlas Exchange Offer and Notes Redemptions
In May 2021, Atlas exchanged an aggregate principal amount of $52.2 million 7.125% senior notes due 2027 of Seaspan (the “Seaspan 2027 Notes”) for an equivalent amount of its 7.125% senior notes due 2027 (the “Atlas 2027 Notes”). In July 2021, Atlas exchanged an additional $151,000 of Seaspan 2027 Notes for Atlas 2027 Notes, following which the Company redeemed the remaining $27.6 million of Seaspan 2027 Notes for cash plus accrued and unpaid interest.
Fairfax Notes Exchange and Redemption
In June 2021, Atlas and Seaspan completed an exchange and amendment of $600.0 million aggregate principal amount of Seaspan’s senior notes, including $250.0 million of 2025 Fairfax Notes, $250.0 million of 2026 Fairfax Notes and $100.0 million of 2027 Fairfax Notes. The outstanding Fairfax Notes were held by certain affiliates of Fairfax Financial Holding Limited (the “Fairfax Holders”).
Pursuant to this transaction, the Company exchanged $200.0 million aggregate principal amount of the 2026 Fairfax Notes and all $100.0 million aggregate principal amount of the 2027 Fairfax Notes for (i) 12,000,000 Series J 7.00% Cumulative Redeemable Perpetual Preferred Shares of Atlas, representing total liquidation value of $300.0 million and (ii) 1,000,000 five year warrants to purchase an equal number of Atlas common shares at an exercise price of $13.71 per share (the “Fairfax Exchange”). The exchanged 2026 Fairfax Notes and 2027 Fairfax Notes were subsequently cancelled.
In August 2021, the Company redeemed the remaining Fairfax Notes, which included $250.0 million of 2025 Fairfax Notes and $50.0 million of 2026 Fairfax Notes, for cash on August 23, 2021.
Sale-Leaseback Financing
In April 2021, the Company entered into $235.0 million in sale-leaseback financing arrangements (the “Sale-Leasebacks”) to refinance three operating vessels, the funding of which was completed in May 2021.
Enhancement of the Company’s Vessel Portfolio Financing Program
In May 2021, the Company entered into amendments and restatements (the “Amendment and Restatement”) of the senior secured loan facilities and intercreditor and proceeds agreement that compromise its vessel portfolio financing program (the “Program”) to, among other things, (i) increase the capacity under the Program to $2.5 billion, including the Sustainability-Linked Notes, (ii) increase the size of the revolving credit facility from $300.0 million to $400.0 million, (iii) increase the commitments under the bank loan facilities by $180.0 million and (iv) extend the maturities of tranches due to 2024 and 2025 by approximately two years.

Additional Financings
In January 2021, the Company made a payment of $69.2 million to early terminate a sale-leaseback financing arrangement secured by a 11,000 TEU vessel. In March 2021, the Company entered into a new sale-leaseback financing arrangement for $83.7 million, secured by the same 11,000 TEU vessel.

In April through November 2021, the Company entered into $3.3 billion in sale-leaseback financing arrangements (the “Newbuild Sale-Leasebacks”) related to 35 newbuild containerships, subject to satisfaction of customary closing conditions. The Newbuild Sale-Leasebacks partially fund pre-delivery payments related to the 35 newbuild containerships. As of December 31, 2021, the Company received aggregate funding of $310.4 million from these financings related to vessels under construction and three delivered vessels.
In October and December 2021, the Company entered into facility agreements providing for an aggregate $2.3 billion in term loans, to finance 18 newbuild containerships. The facility agreements partially fund pre-delivery payments relating to the 18 vessels. At delivery, pursuant to the facility agreements, the Company may elect to convert the term loan in respect of each vessel into a lease financing arrangement, whereby we will sell the vessel to Japanese special purpose companies ("SPCs") and lease it back over a term of approximately 14 years, with one or more options to purchase the vessel at the 9.5 year anniversary and, for certain vessels, the 12-year anniversary of the lease for a pre-determined fair value purchase price. As at December 31, 2021, the Company has not drawn on these facilities.

In October 2021, the Company entered into agreements relating to underwritten financing arrangements totaling $1.4 billion, related to 17 newbuild containerships. In December 2021, the Company entered into lease financing arrangements for two
35

of the 17 vessels. The lease financing arrangements are expected to provide gross financing proceeds of approximately $113.0 million per vessel upon delivery of each vessel, or $226.0 million in total. Under the lease financing arrangements, we will sell the vessels to SPCs and lease the vessels back over a term of 13.25 years, with an option to purchase the vessels at the 5-year anniversary of the lease for a pre-determined fair value purchase price.
In February 2022, the Company entered into a $250.0 million 3-year sustainability-linked unsecured revolving credit facility, to be used to fund vessels under construction and secondhand vessel acquisitions and for general corporate purposes (the “2022 RCF”). The 2022 RCF replaces the Company’s $150.0 million 2-year unsecured revolving credit facility and bears interest at market rate. To date, the Company has not drawn on the 2022 RCF.
Debt Offerings
In February 2021 and April 2021, we issued $200.0 million and $300.0 million, respectively, of 6.5% senior unsecured sustainability-linked bonds into the Nordic marketplace (collectively, the “NOK Bonds”). The bonds mature in February 2024 and April 2026, respectively, and bear interest at 6.5% per annum. If certain sustainability linked targets in the NOK Bonds are met, they are to be redeemed at maturity at 100.0% of the initial principal amount. If the sustainability linked targets are not met, the NOK Bonds are to be settled at maturity at 100.5% of the initial principal amount. The NOK Bonds are listed on the Oslo Stock Exchange.
In May 2021, the Company entered into a note purchase agreement to issue, in a private placement (the “Private Placement”), $500.0 million aggregate principal amount of fixed rate, sustainability-linked senior secured notes (the “Senior Secured Notes”). On May 21, 2021, the Company issued $450.0 million of such notes, comprised of $150.0 million aggregate principal amount of 3.91% Series A Senior Secured Notes due 2031, $170.0 million aggregate principal amount of 4.06% Series C Senior Secured Notes due 2033 and $130.0 million aggregate principal of 4.26% Series D Senior Secured Notes due 2036. The Company issued the remaining $50.0 million aggregate principal amount of 3.91% Series B Senior Secured Notes due 2031 in August 2021. The Private Placement was completed as part of an amendment and upsize of the Program.
In July 2021, the Company issued $750.0 million aggregate principal amount of 5.50% senior unsecured notes due 2029. The notes are a blue transition bond and Seaspan’s senior unsecured obligations and accrue interest at a rate of 5.50% per year, payable semi-annually in arrears on February 1 and August 1 of each year, beginning on February 1, 2022. The notes are not guaranteed by Atlas or any of its or Seaspan’s respective subsidiaries. The notes will mature on August 1, 2029, unless earlier repurchased or redeemed.
Debt Offerings
In March 2022, Seaspan entered into a joint venture agreement to form a procurement joint venture with a leading independent ship management company to leverage the combined purchasing power of the partners and their respective affiliates to procure products and services. The business of the joint venture may be expanded in future to include offering procurement services to third party customers and any other business as may be agreed between the partners.
Changes to Senior Management
In January 2021, Graham Talbot was appointed Chief Financial Officer of Atlas and Seaspan.
In February 2022, Karen Lawrie resigned as General Counsel of Atlas and Seaspan.
36



Subsequent Events
Dividends
On January 3, 2022, the Company declared dividends of $47.5 million on its common shares to Atlas, which was paid on January 24, 2022.
Exercised Option
In January 2022, the Company exercised its option under an existing lease financing arrangement to purchase one 10,000 TEU vessel. The purchase is expected to complete in January 2023 at the pre-determined purchase price of $52.7 million
Interest Rate Swap
In January 2022, the Company entered into an interest rate swap with a notional amount of $500.0 million. The swap has a 10-year term and the Company pays a fixed rate of 1.925% and receives a floating rate based on three month LIBOR.
Vessel Sale
In February 2022, the Company sold one 4,250 TEU vessel for an aggregate purchase price of $32.8 million. The Company continues to manage the ship operations of the vessel.
New Financing
In February 2022, the Company entered into a $250.0 million 3-year sustainability-linked unsecured revolving credit facility (the “2022 RCF”). The 2022 RCF replaces the Company’s $150.0 million 2-year unsecured revolving credit facility and bears interest at market rate.


Impact of COVID-19 on our Business
The COVID-19 pandemic initially negatively affected global demand for seaborne transportation, decreasing freight and charter rates in the first half of 2020. Since then, however, the shipping industry has seen robust demand for seaborne transportation, with freight volumes and freight rates rebounding sharply. High demand for containerships has resulted in negligible vessel capacity available in certain size segments as of December 31, 2021, increasing charter rates for all segments and enabling us to recharter and forward fix many of our vessels which had charters expiring this year or in the near term at higher rates. Increased demand has also enabled us to execute shipbuilding contracts for 70 newbuilds since December 2020, with long-term charters attached. We believe future significant downside risk to our containership business is mitigated by our longstanding business relationships and the long-term contracts securing the majority of our fleet.
In our containership business, costs of operations have increased due to COVID-19’s impact on supply chains, on workers’, surveyors’ and other specialists’ access to the shipyards to complete repairs and inspections, and on the ability to conduct crew transfers. The average daily operating cost per vessel per day for vessels on time charter for the year ended December 31, 2021 increased to $6,766.0 compared to $6,010.0 per vessel per day for the year ended December 31, 2020. To mitigate, we have made logistical changes and worked with vendors to ensure continued access to equipment and supplies. We have also intentionally delayed or altered plans for repairs and vessel projects where practicable. For our crew, we have developed and implemented extended onboard management procedures and we have prepared response plans should any crew member fall ill onboard. In addition, although embarkation and disembarkation of seafarers remains challenging and there are increased costs associated, we are conducting crew changes at ports where transfers are permitted. Management has obtained agreements from certain charterers to alter trading routes to facilitate crew changes.
Some of our office staff continue to work remotely, but many have started to return to our physical offices. The return to office is being done on a gradual basis, as local health authorities ease COVID-19 related restrictions. During 2021, there was no meaningful increase in costs or expenses resulting from measures to facilitate remote working.
We continuously monitor the developing situation, as well as our customers’ response thereto, and make all necessary preparations to address and mitigate, to the extent possible, the impact of COVID-19 to our Company.





37

Impact of Recent Developments in Ukraine
In February 2022, as a result of the invasion of Ukraine by Russia, economic sanctions were imposed by the U.S., the EU, the UK and a number of other countries on Russian financial institutions, businesses and individuals, as well as certain regions within the Donbas region of Ukraine. While it is difficult to estimate the impact of current or future sanctions on the Company’s business and financial position, these sanctions could adversely impact the Company’s operations and/or financial results. In the near term, we expect increased volatility in the region due to these geopolitical events and, with the support of our customers, our vessels have ceased trading to Russia for the time being. We also anticipate we could face challenges to recruit seafarers in sufficient numbers to replace Ukrainians seafarers who are not able or permitted to leave their country, given that Ukrainians constitute a significant number of our seafarers. Finally, we expect that the Russia-Ukraine conflict may exacerbate market volatility, and may impact access to and pricing of capital. For more information regarding the risks relating to economic sanctions as a result of Russia’s invasion of Ukraine as well as the impact on retaining and sourcing our crew, see “Item 3. Key Information—D. Risk Factors” in Atlas' Annual Report for the year ended December 31, 2021.

38

Results of Operations

Year Ended December 31, 2021, Compared with Year Ended December 31, 2020
The following tables summarize Seaspan’s consolidated financial results for the years ended December 31, 2021, and 2020.

Consolidated Financial Summary
(in millions of US dollars)		December 31,
20212020
Revenue$1,470.3 $1,230.8 
Ship operating expense289.3 243.4 
Depreciation and amortization expense307.9 288.1 
General and administrative expense42.4 29.7 
Operating lease expense143.0 147.3 
Operating earnings703.6 522.3 
Interest expense178.8 176.0 
Net earnings394.5 313.4 
Cash from operating activities860.0 627.4 

Operating Results
Ownership Days are the number of days a vessel is owned and available for charter. Ownership Days On-Hire are the number of days a vessel is available to the charterer for use. The primary driver of Ownership Days is the increase or decrease in the number of vessels in our fleet.
Total Ownership Days increased by 2,466 days for the year ended December 31, 2021, compared with the same period in 2020. The increase was due to the delivery of seven vessels between December 2020 and December 2021, which contributed 1,040 days. Additionally, full year benefits from the fifteen vessels delivered during 2020 contributed 1,644 days.
Vessel Utilization represents the number of Ownership Days On-Hire as a percentage of Total Ownership Days. The following table summarizes Seaspan’s Vessel Utilization for the last eight consecutive quarters:
20202021YTD
Q1Q2Q3Q4Q1Q2Q3Q420202021
Vessel Utilization:
Time Charter Ownership Days (1)
9,646 10,047 10,284 10,520 10,318 10,609 10,946 10,885 40,497 42,758 
Bareboat Ownership Days (1)
1,069 1,092 1,104 1,104 1,112 1,092 1,105 1,265 4,369 4,574 
Total Ownership Days10,715 11,139 11,388 11,624 11,430 11,701 12,051 12,150 44,866 47,332 
Less Off-Hire Days:
Scheduled Dry-Docking(131)(195)(89)(20)(63)(111)(123)(95)(435)(392)
Unscheduled Off-Hire (2)
(90)(90)(68)(29)(25)(60)(44)(93)(277)(222)
Ownership Days On-Hire10,494 10,854 11,231 11,575 11,342 11,530 11,884 11,962 44,154 46,718 
Vessel Utilization97.9 %97.4 %98.6 %99.6 %99.2 %98.5 %98.6 %98.5 %98.4 %98.7 %
(1)Ownership Days for time charters and bareboat charters exclude days prior to the initial charter hire date
(2)Unscheduled off-hire includes days related to vessels being off-charter.

Vessel utilization remained constant and increased for the year ended December 31, 2021, compared with the same periods in 2020 respectively. The increase was primarily due to a decrease in the number of Scheduled Dry-Docking days.

During the year ended December 31, 2021, we completed dry-dockings for four 10,000 TEU vessels, three 4,500 TEU vessels, eight 4,250 TEU vessels and three 2,500 TEU vessels. During the year ended December 31, 2020, we completed dry-dockings for five 14000 TEU vessels, five 10,000 TEU vessels, four 8,500 TEU vessels, eight 4,250 TEU vessels and two 2,500 TEU vessels.
39

Newbuild Vessels

The following table summarizes key facts regarding our 67 newbuild vessels totaling 811,400 TEU as of December 31, 2021:
Hull NumberVessel Class
(TEU)		Expected Delivery DateCharterer
Length of
Charter(1)
Charter Type
233824000Jun-23MSC18 yearsBareboat Charter
233924000Jul-23MSC18 yearsBareboat Charter
H1845A15500Aug-23MaerskMinimum 84 months and up to 96 monthsTime Charter
H276015500Oct-23MaerskMinimum 84 months and up to 96 monthsTime Charter
H276115500Dec-23MaerskMinimum 84 months and up to 96 monthsTime Charter
H1846A(2)
15500Dec-23ONE18 yearsBareboat Charter
H1847A(2)
15500May-24ONE18 yearsBareboat Charter
H2762(2)
15500Mar-24ONE18 yearsBareboat Charter
1384(2)(3)
16000Jun-24MSC5 yearsTime Charter
1385(2)(3)
16000Jul-24MSC5 yearsTime Charter
1344(2)(3)
16000May-24MSC5 yearsTime Charter
134515000Apr-24ONE5 yearsTime Charter
134615000May-24ONE5 yearsTime Charter
134715000Jun-24ONE5 yearsTime Charter
134015000Jan-23ONEMinimum 60 months and up to 64 months Time Charter
134115000Apr-23ONEMinimum 60 months and up to 64 months Time Charter
134215000May-23ONEMinimum 60 months and up to 64 months Time Charter
134315000Jul-23ONEMinimum 60 months and up to 64 months Time Charter
243415000Feb-23ZIM12 years Time Charter
243515000Mar-23ZIM12 years Time Charter
243615000Apr-23ZIM12 years Time Charter
243715000May-23ZIM12 years Time Charter
243815000Jul-23ZIM12 years Time Charter
244415000Sep-23ZIM12 years Time Charter
244515000Nov-23ZIM12 years Time Charter
244615000Nov-23ZIM12 years Time Charter
244715000Dec-23ZIM12 years Time Charter
244815000Jan-24ZIM12 years Time Charter
1360(3)
16000Nov-23MSC18 yearsBareboat Charter
1361(3)
16000Dec-23MSC18 yearsBareboat Charter
1362(3)
16000Jan-24MSC18 yearsBareboat Charter
1363(3)
16000Feb-24MSC18 yearsBareboat Charter
1364(3)
16000Feb-24MSC18 yearsBareboat Charter
1365(3)
16000Apr-24MSC18 yearsBareboat Charter
J026412200Apr-22MSC18 yearsBareboat Charter
J026512200Jun-22MSC18 yearsBareboat Charter
227012000Sep-22ONEMinimum 60 months and up to 64 months Time Charter
227112000Oct-22ONEMinimum 60 months and up to 64 months Time Charter
282212000Jul-22ONEMinimum 60 months and up to 64 months Time Charter
282312000Aug-22ONEMinimum 60 months and up to 64 months Time Charter
204912000Oct-22ZIM5 yearsTime Charter
205012000Nov-22ZIM5 yearsTime Charter
13697000Oct-23ZIM12 years Time Charter
13707000Nov-23ZIM12 years Time Charter
13717000Dec-23ZIM12 years Time Charter
13727000Jan-24ZIM12 years Time Charter
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13737000Feb-24ZIM12 years Time Charter
13867000Apr-24ZIM12 years Time Charter
13877000May-24ZIM12 years Time Charter
13887000Jun-24ZIM12 years Time Charter
13897000Jun-24ZIM12 years Time Charter
13907000Aug-24ZIM12 years Time Charter
13947000Oct-24ZIM12 years Time Charter
13957000Nov-24ZIM12 years Time Charter
13967000Nov-24ZIM12 years Time Charter
13977000Dec-24ZIM12 years Time Charter
13987000Dec-24ZIM12 years Time Charter
H15627000Apr-24ONE10 yearsTime Charter
H15637000May-24ONE10 yearsTime Charter
H15647000Jun-24ONE10 yearsTime Charter
H15657000Jul-24ONE10 yearsTime Charter
H15667000Jul-24ONE10 yearsTime Charter
H15677000Aug-24ONE10 yearsTime Charter
H15687000Sep-24ONE10 yearsTime Charter
H15697000Sep-24ONE10 yearsTime Charter
H15707000Oct-24ONE10 yearsTime Charter
H15717000Nov-24ONE10 yearsTime Charter
(1)Excludes all option periods in the charterer’s option.
(2)In October 2021, the charterers for three 15500 TEU and 15000 TEU vessels were swapped between MSC and ONE.
(3)In October 2021, nine of the 15000 TEU vessels were upgraded to 16000 TEU with delivery dates extended by two months.

Gross Contracted Cash Flows – Undelivered Vessels

As of December 31, 2021, the gross contracted cash flows for 67 undelivered vessels is summarized below:

(in millions of USD)
2022$62.8 
2023431.9
2024975.8
2025967.4
2026967.4
Thereafter7,415.4
$10,820.7 

Financial Results Summary
Revenue
Revenue increased by 19.5% to $1,470.3 million for the year ended December 31, 2021 compared with the same period in 2020. Of this increase, 87.6% was attributable to the existing asset base, and 12.4% was attributable to assets added during the year.
Ship Operating Expense
Operating expense increased by 18.9% to $289.3 million for the year ended December 31, 2021 compared to 2020. The increase was primarily due to a growth of our operating fleet.
Depreciation and Amortization Expense
Depreciation and amortization expense increased by 6.9% to $307.9 million for the year ended December 31, 2021 compared to 2020. The increase was primarily due to the growth of our operating fleet.
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General and Administrative Expense
General and administrative expense increased by 42.8% to $42.4 million for the year ended December 31, 2021 compared to 2020 The increase was primarily due to an increase in general corporate expenses including non-cash share-based compensation.
Loss on debt extinguishment
During the year ended December 31, 2021, there was a $127.0 million non-cash charge for loss on debt extinguishment related to early debt settlement.
Operating Lease Expense
Operating lease expense decreased by 2.9% to $143.0 million for the year ended December 31, 2021 compared to 2020. The decrease was primarily due to a decrease in LIBOR and a reassessment due to a lease modification in Q3 2021.
Interest Expense and Amortization of Deferred Financing Fees
The following table summarizes our borrowings:

(in millions of US dollars)December 31,Change
20212020$%
Long-term debt, excluding deferred financing fees:
Revolving credit facilities$— $796.4 $(796.4)(100.0)%
Term loan credit facilities2,128.6 1,912.3 216.3 11.3 %
Senior unsecured notes (d)1,250.0 80.0 1,170.0 1462.5 %
Fairfax Notes— 600.0 (600.0)(100.0)%
Senior Unsecured Exchangeable Notes201.3 — 201.3 100.0 %
Senior Secured Notes (g)500.0 — 500.0 100.0 %
Debt discount and fair value adjustment(5.1)(136.0)130.9 96.3 %
Other financing arrangements, excluding deferred financing fees1,363.1 808.3 554.8 68.6 %
Total borrowings$5,437.9 $4,061.0 $1,376.9 33.9 %
Vessel under construction(1,020.0)— (1,020.0)100.0 %
Operating borrowings$4,417.9 $4,061.0 $356.9 8.8 %
(1)Total borrowings is a non-GAAP financial measure which comprises of long-term debt and other financing arrangements, excluding deferred financing fees. The Company’s total borrowings include amounts related to vessels under construction, consisting primarily of amounts borrowed to pay installments to shipyards. The interest incurred on borrowings related to the vessels under construction are capitalized during the construction period. Total borrowings and operating borrowings are non-GAAP financial measures that are not defined under or prepared in accordance with U.S. GAAP. Disclosure of total borrowings and operating borrowings is intended to provide additional information and should not be considered a substitute for financial measures prepared in accordance with U.S. GAAP.

Interest expense increased by $2.8 million to $178.8 million for the year ended December 31, 2021 compared with the same period in 2020. The increase is primarily due to the issuance of the senior secured and senior unsecured notes, partially offset by the decrease in LIBOR rates.

Loss on Derivative Instruments
The change in fair value of financial instruments resulted in a gain of $5.7 million for the year ended December 31, 2021 compared to a loss of $31.5 million for the year ended December 31, 2020. The gain for this period was primarily due to a decrease in the forward LIBOR forward curve, the impact of swap settlements and the gain on the capped call on our Exchangeable Notes. This was partially offset by a loss on the embedded derivative exchange feature on the Exchangeable Notes.
The fair value of our interest rate swaps are subject to, and the fair value of our Fairfax derivative put instruments (which are no longer outstanding) were subject to, change based on our company specific credit risk included in the discount factor and current swap curve, including its relative steepness. In determining the fair value, these factors are based on current information available to us. These factors are expected to change through the life of the instruments, causing the fair value to fluctuate significantly due to the large notional amounts and long-term nature of our derivative instruments. As these factors may change, the fair value of the instruments is an estimate and may deviate significantly from the actual cash settlements realized during the term of the instruments. Our valuation techniques have not changed, and we believe that such techniques are consistent with those followed by other valuation practitioners.
The fair value of our interest rate swaps is most significantly impacted by changes in the yield curve. Based on the current notional amount and tenor of our interest rate swap portfolio, a one percent parallel shift in the overall yield curve is expected to result in a change in the fair value of our interest rate swaps of approximately $6.9 million. Actual changes in the yield curve are not expected to occur equally at all points and changes to the curve may be isolated to periods of time. This steepening or flattening of the yield curve may result in greater or lesser changes to the fair value of our financial instruments in a particular period than would occur had the entire yield curve changed equally at all points.
The fair value of our interest rate swaps is also impacted by changes in our company-specific credit risk included in the discount factor. We discount our derivative instruments with reference to the corporate Bloomberg industry yield curves. Based on
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the current notional amount and tenor of our swap portfolio, a one percent change in the discount factor is expected to result in a change in the fair value of our interest rate swaps of approximately $16.6 million.
Our fair value instruments, including interest rate swaps and put instruments were marked to market with all changes in the fair value of these instruments recorded in “Change in fair value of financial instruments” in our Interim Consolidated Statement of Operations.
Please read “Item 11. Quantitative and Qualitative Disclosures About Market Risk” in Atlas’ 2021 Annual Report on Form 20-F for additional information.
Liquidity and Capital Resources
Liquidity
As of December 31, 2021, we have total liquidity of $719.0 million, consisting of $169.0 million of cash and cash equivalents and $550.0 million of undrawn commitments under available revolving credit facilities. Our primary short-term liquidity needs are to fund our operating expenses, investments in assets including vessels under construction, debt repayments, lease payments, swap settlements, payment of quarterly dividends and payments on our other financing arrangements. Our medium-term liquidity needs primarily relate to debt repayments, vessel purchase commitments, lease payments and payments on our other financing arrangements. Our long-term liquidity needs primarily relate to potential future acquisitions, lease payments, debt repayments including repayment of our notes, the potential future redemption of our preferred shares and payments on our other financing arrangements. Please read note 8 “Long-term debt”, note 9 “Operating lease liabilities”, note 10 “Other financing arrangements” in our year ended Consolidated Financial Statements for additional information.
We anticipate that our primary sources of funds for our short-term liquidity needs will be cash from operations, and existing and new credit facilities and other financing arrangements. We anticipate our medium and long-term sources of funds will be from cash from operations, new credit facilities, lease facilities and capital markets financings to the extent available.
The following table summarizes our liquidity as of December 31, 2021 and 2020:

(in millions of US dollars)December 31, Change
20212020$%
Cash and cash equivalents$169.0 $243.5 $(74.5)(31)%
Undrawn revolving credit facilities550.0 150.0 400.0 267 %
Undrawn term loan facilities— — — — %
Total liquidity$719.0 $393.5 $325.5 83 %
Total committed and undrawn newbuild financings5,974.7—
Total liquidity including newbuild financings6,693.7393.5

Our Credit Facilities
We primarily use our credit facilities to finance the construction and acquisition of assets. As at December 31, 2021, our credit facilities are secured by first-priority mortgages granted on 65 of our vessels, together with other related security, such as assignments of lease contracts, earnings from our charters, assignments of insurances and management agreements for vessels.
As of December 31, 2021, we had $2.2 billion outstanding under our revolving credit facilities and term loan credit facilities excluding deferred financing fees. In addition, there is $550.0 million available to be drawn under our revolving credit facilities.
Interest payments on our term loan credit facilities are based on LIBOR plus margins, which ranged between 0.4% and 2.3% as of December 31, 2021. For a portion of one of our term loans, interest is calculated based on the reference rate of KEXIM plus a margin, which was 0.7% as of December 31, 2021. One of our term loan credit facilities bears interest at a fixed rate of 7.7%. Two of our term loans bear interest at a fixed rate of 3.8%.
The Company may prepay certain amounts outstanding without penalty, other than breakage costs in certain circumstances. A prepayment may be required as a result of certain events, including without limitation the sale or loss of a vessel, a termination or expiration of a charter (and the inability to enter into a replacement charter acceptable to lenders within a prescribed period of time). The amount that must be prepaid may be calculated based on the loan to market value. In these circumstances, valuations of the Company’s vessels are conducted on a “without charter” basis as required under the credit facility agreement.
Each credit facility contains a mix of financial covenants requiring the Company to maintain minimum liquidity, tangible net worth, interest and principal coverage ratios, and debt-to-assets ratios, as defined. Certain facilities are guaranteed by an intermediate parent entity, in which case the parent entity must meet certain consolidated financial covenants under those term loan facilities including maintaining certain minimum tangible net worth, cash requirements and debt-to-asset ratios.
Some of the facilities also have an interest and principal coverage ratio, debt service coverage and vessel value requirement for the subsidiary borrower. We were in compliance with these covenants at December 31, 2021.

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The following is a schedule of key facts relating to the Company’s credit facilities as of December 31, 2021:

(in millions of USD)Scheduled AmortizationBullet Due on MaturityTotal Future Minimum RepaymentsAdditional Vessels Unencumbered Upon MaturityNet Book Value of Vessels Unencumbered(1)
2022$217.0 $326.5 $543.5 8 $679.6 
2023156.8 111.4 268.2 3 362.2 
2024138.9 — 138.9 — 
2025136.1 — 136.1 — 
202674.7 704.0 778.7 — 
202716.8 224.4 241.3 — 
20288.8 — 8.8 — 
20298.8 — 8.8 — 
20304.4 — 4.4 2 171.7 
2031— — — — 
Thereafter— — — 52 3,226.3 
Total$762.3 $1,366.3 $2,128.6 65 $4,439.8 
Notes
As of December 31, 2021, we had $2.0 billion outstanding under our 3.75% exchangeable senior notes (the “Exchangeable Notes”), our 6.5% senior unsecured bonds due 2024 (the “2024 Bonds”), our 6.5% senior unsecured bonds due 2026 (the “2026 Bonds” and together with the 2024 Bonds, the “Bonds”), sustainability-linked senior secured notes (the “Senior Secured Notes”), and 5.5% senior unsecured notes due 2029 (the “2029 Notes”), excluding deferred financing fees. As of December 31, 2021, there were no Fairfax Notes outstanding.
Our Exchangeable Notes are exchangeable at the holders’ option into an aggregate 15,474,817 Atlas common shares at an initial exchange price of $13.005 per share, the cash equivalent or a combination thereof, as elected by us, at any time on or after September 15, 2025, or earlier upon the occurrence of certain market price triggers, significant corporate events, or in response to early redemption elected by us. The holders may require us to redeem the Exchangeable Notes upon the occurrence of certain corporate events qualifying as a fundamental change in the business. We may redeem the Exchangeable Notes in connection with certain tax-related events or on any business day on or after December 20, 2023 and prior to September 15, 2025, if the last reported sale price of Atlas shares is at least 130.0% of the exchange price during a specified measurement period. A redemption of the Exchangeable Notes is made at 100.0% of the principal amount, plus accrued and unpaid interest. In connection with the Exchangeable Notes, we entered into capped call transactions using $15.5 million in proceeds from the issuance of the Exchangeable Notes to reduce the potential dilution to Atlas shares and/or offset any cash payments that are required upon an exchange, up to a maximum share price.
In February and April 2021, we issued $200.0 million and $300.0 million of Bonds, respectively. The Bonds bear interest at 6.5% per annum and mature in February 2024 and April 2026, respectively. Upon maturity, 100.0% of the principal balance is due or 100.5% if certain sustainability-linked targets are not achieved, except in the event of certain eligible changes in tax law. Upon the occurrence of a Change in Control or a De-Listing event (as defined in the relevant Bond Terms), each holder of Bonds will have the right to require us to purchase all or a portion of such holder’s Bonds at a purchase price equal to 101.0% of the principal amount thereof plus accrued and unpaid interest, if any.
On May 21 and August 12, 2021, we issued an aggregate $500.0 million of Senior Secured Notes, which bear interest between 3.91% and 4.26% and mature between 2031 and 2036. The Senior Secured Notes are secured by the same portfolio of vessels as our Program.
On July 14, 2021, the Company issued $750.0 million of 2029 Notes. These notes accrue interest at 5.5% per annum.
Please read “Significant Developments During the Year ended December 31, 2021” for additional information.
Operating Leases
As of December 31, 2021, there were 14 vessel operating lease arrangements. Under 13 of the operating lease arrangements the Company may purchase the vessels for a predetermined purchase price. As of December 31, 2021, there were total commitments, excluding purchase options, under vessel operating leases from 2022 to 2029 of approximately $780.7 million.

Based on current market conditions, the Company expects that it will exercise the purchase options for the 13 vessels under operating lease which include purchase options. These purchase option prices are $681.0 million in aggregate for the 13 vessels, and if exercised, the purchases would be completed between January 2023 and November 2026. If exercised, the term of the operating leases would be shortened, and the amount paid by the Company under the operating leases (excluding the purchase option price) would be less than the total commitment outlined below. In January 2022, the Company exercised its option to purchase one 10,000 TEU vessel. The purchase is expected to complete in January 2023 at the pre-determined purchase price of $52.7 million.
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Other Financing Arrangements
We enter into financing arrangements consisting of financing sale-leaseback and failed sales arrangements with special purpose entities, which are consolidated by us as primary beneficiaries. These leases are provided by bank financial leasing owners who legally own our vessels through special purpose entities and are also granted other related security, such as assignments of time charters, earnings for the vessels, insurances for the vessels and management agreements for the vessels. We use these arrangements to finance the construction and acquisition of vessels, as well as certain of our operating vessels.
As of December 31, 2021, we have 26 vessels under these financing arrangements, which provided for borrowings of approximately $1.4 billion excluding deferred financing fees. Under these agreements, we may voluntarily terminate a lease agreement, subject to payment of a termination fee in certain circumstances. We are also required to prepay rental amounts, broken funding costs and other costs to the lessor in certain circumstances, such as a termination or expiry of a charter (where we do not enter into a charter acceptable to the lessors within a required period of time). If we default under these financing arrangements, our lessors could declare all outstanding amounts to be immediately due and payable and realize on the security granted under these arrangements.
For additional information about our credit and lease facilities and other financing arrangements, including, among other things, a description of certain related covenants, please read “Item 5. Operating and Financial Review and Prospects—C. Liquidity and Capital Resources” in Atlas’ 2021 Annual Report.
The following is a schedule of key facts under our other financing arrangements as of December 31, 2021:

(in millions of USD)Scheduled AmortizationBullet Due on MaturityTotal Future Minimum RepaymentsAdditional Vessels Unencumbered Upon Maturity
Net Book Value of Vessels Unencumbered(1)(2)
2022$101.0 $— $101.0 — $— 
2023101.4 — 101.4 — — 
2024102.6 — 102.6 — — 
202597.4 — 97.4 — — 
202694.2 — 94.2 — — 
202794.2 — 94.2 — — 
202894.2 — 94.2 — — 
202986.5 27.0 113.5 2 191.1 
203061.3 181.0 242.3 7 576.4 
203144.8 60.0 104.8 2 169.3 
Thereafter98.1 119.4 217.5 7 589.0 
Total$975.7 $387.4 $1,363.1 18 $1,525.8 
(1)Includes unencumbered vessels that are included on our balance sheet as “Vessels” and as “Net Investment in Lease”.
(2)Newbuilds that have not been delivered as at December 31, 2021, have not been included.
Cash Flows
The following table summarizes our sources and uses of cash for the periods presented:

(in millions of US dollars)December 31,
20212020
Net cash flows from operating activities$860.0 $627.4 
Net cash flows used in investing activities(1,683.7)(891.5)
Net cash flows from financing activities749.2 310.3 

Operating Cash Flows
Net cash flows from operating activities was $860.0 million for the year ended December 31, 2021, an increase of $232.6 million, compared to 2020. The increase in net cash flows from operating activities for the year ended December 31, 2021, compared to the prior year, was primarily due to net cash flows from chartering of seven additional vessels delivered during 2021 and higher revenue due to increases in the charter rates in 2021. For further discussion of changes in revenue and expenses, please read “Financial Results Summary”.
Investing Cash Flows
Net cash flows used in investing activities were $1,683.7 million for the year ended December 31, 2021, an increase of $792.2 million compared to 2020. Increase in cash used was primarily due to the purchase of seven vessels during the year ended December 31, 2021 and payment on installments for vessels under construction partially offset by proceeds from the sale of one vessel.
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Financing Cash Flows
Net cash flows from financing activities were 749.2 million for the year ended December 31, 2021, compared to net cash flows used in financing activities of $310.3 million in 2020. This represents a net increase of $438.9 million in cash flows from financing activities for the year ended December 31, 2021, compared to 2020. Increase was primarily due to proceeds received from the long term debt and other financing arrangements related to newbuild financing, partially offset by redemption of the Fairfax Notes.
Ongoing Capital Expenditures
Ongoing Capital Expenditures
The average age of the vessels in our containership fleet is approximately eight years, on a TEU-weighted basis. Capital expenditures for our containership fleet primarily relate to our regularly scheduled dry-dockings. During the year ended December 31, 2021, we completed 18 dry-dockings compared to 24 dry-dockings in 2020.
We must make substantial capital expenditures over the long-term to preserve our capital base, which is comprised of our net assets, to continue to refinance our indebtedness and to maintain our dividends. We will likely need to retain additional funds at some time in the future to provide reasonable assurance of maintaining our capital base over the long-term. We believe it is not possible to determine now, with any reasonable degree of certainty, how much of our operating cash flow we should retain in our business and when it should be retained to preserve our capital base. The amount of operating cash flow we retain in our business will affect the amount of our dividends. Factors that will impact our decisions regarding the amount of funds to be retained in our business to preserve our capital base, include the following, many of which are currently unknown and are outside our control:
(1)the remaining lives of our vessels;
(2)the returns that we generate on our retained cash flow, which will depend on the economic terms of any future asset acquisitions and lease terms;
(3)future contract rates for our assets after the end of their existing leases agreements;
(4)our future operating and interest costs;
(5)future operating and financing costs; 
(6)our future refinancing requirements and alternatives and conditions in the relevant financing and capital markets at that time; and
(7)unanticipated future events and other contingencies.
Please read “Item 3. Key Information – D. Risk Factors” in Atlas’ 2021 Annual Report for factors that may affect our future capital expenditures and results.

Critical Accounting Policies and Estimates
We prepare our consolidated financial statements in accordance with U.S. GAAP, which requires us to make estimates in the application of our accounting policies based on our best assumptions, judgments and opinions. Our estimates affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosures. We base our estimates on historical experience and anticipated results and trends and on various other assumptions that we believe are reasonable under the circumstances. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material. For more information about our critical accounting estimates, please read “Item 5. Operating and Financial Review and Prospects - E. Critical Accounting Estimates” in Atlas’ 2021 Annual Report.

Recent accounting pronouncements
Discontinuation of LIBOR
The Company adopted ASU 2020-04, “Reference Rate Reform (Topic 848)”, prospectively to contract modifications. The guidance provides optional relief for the discontinuation of LIBOR resulting from rate reform. Contract terms that are modified due to the replacement of a reference rate are not required to be remeasured or reassessed under FASB’s relevant U.S. GAAP Topic. The election is available by Topic. The Company has elected to apply the optional relief for contracts under ASC 470, “Debt”, ASC 840 and 842, “Leases”, and ASC 815, “Derivatives and Hedging”. There was no impact to the Company's financial statements upon initial adoption. The LIBOR replacement modifications for Debt contracts will be accounted for by prospectively adjusting the effective interest rate in the agreements. Existing lease and derivative contracts will require no reassessments. Transition activities are focused on the conversion of existing LIBOR based contracts to the Secured Overnight Financing Rate.
Debt with conversion and other options
Effective January 1, 2022, the Company adopted ASU 2020-06, “Debt – Debt with Conversion and Other Options (Subtopic 470-20)”, using the modified retrospective method, whereby the accounting for convertible debt instruments is simplified by reducing the number of accounting models and circumstances when embedded conversion features are separately recognized. The adoption of this standard is not expected to have a material impact to the Company.
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Off-Balance Sheet Arrangements
At December 31, 2021, we do not have any off-balance sheet arrangements.

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FORWARD-LOOKING STATEMENTS
This Report on Form 6-K for the year ended December 31, 2021, contains forward-looking statements (as such term is defined in Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act) concerning our operations, cash flows, and financial position, including, in particular, the likelihood of our success in developing and expanding our business, include forward-looking statements (as such term is defined in Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act). Statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as “continue,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,” “projects,” “forecasts,” “will,” “may,” “potential,” “should” and similar expressions are forward-looking statements. Although these statements are based upon assumptions we believe to be reasonable based upon available information, including projections of revenues, operating margins, earnings, cash flow, working capital and capital expenditures, they are subject to risks and uncertainties that are described more fully in “Item 3. Key Information—D. Risk Factors” in Atlas’ Annual Report for the year ended December 31, 2021.
These forward-looking statements represent our estimates and assumptions only as of the date of this Report and are not intended to give any assurance as to future results. As a result, you are cautioned not to rely on any forward-looking statements. Forward-looking statements appear in a number of places in this Report. These statements include, among others:
•future operating or financial results;
•future growth prospects;
•our business strategy and capital allocation plans, and other plans and objectives for future operations;
•potential acquisitions, financing arrangements and other investments, and our expected benefits from such transactions;
•our primary sources of funds for our short, medium and long-term liquidity needs;
•our expectations as to impairments of our vessels and power generation assets, including the timing and amount of potential impairments;
•the future valuation of our vessels, power generation assets and goodwill;
•future time charters and vessel deliveries, including replacement charters and future long-term charters for certain existing vessels;
•estimated future capital expenditures needed to preserve the operating capacity of our containership fleet and to comply with regulatory standards, our expectations regarding future operating expenses, including dry-docking and other ship operating expenses, and general and administrative expenses;
•our ability to recruit and retain crew for our containerships, particularly in light of the current Russia-Ukraine conflict and the COVID-19 pandemic;
•number of off-hire days and dry-docking requirements;
•global economic and market conditions and shipping market trends, including charter rates and factors affecting supply and demand for our containerships;
•disruptions in global credit and financial markets as the result of the COVID-19 pandemic, the Russia-Ukraine conflict or otherwise;
•conditions in the public equity market and the price of our shares;
•our financial condition and liquidity, including our ability to borrow funds under our credit facilities, our ability to obtain waivers or secure acceptable replacement charters under certain of our credit facilities, our ability to refinance our existing facilities and notes and to obtain additional financing in the future to fund capital expenditures, acquisitions and other general corporate activities;
•our continued ability to maintain, enter into or renew primarily long-term, fixed-rate time charters with our existing customers or new customers;
•the potential for early termination of long-term contracts and our potential inability to enter into, renew or replace long-term contracts;
•changes in governmental rules and regulations or actions taken by regulatory authorities, and the effect of governmental regulations on our business;
•our continued ability to meet specified restrictive covenants in our financing and lease arrangements, our notes and our preferred shares;
•the length and severity of the ongoing COVID-19 pandemic, including as a result of the new variants of the virus, and its impact on our business;
•the financial condition of our customers, lenders and other counterparties and their ability to perform their obligations under their agreements with us;
•our ability to leverage to our advantage our relationships and reputation in the containership industry;
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•changes in technology, prices, industry standards, environmental regulation and other factors which could affect our competitive position, revenues and asset values;
•disruptions and security threats to our technology systems;
•taxation of our company, including our exemption from tax on our U.S. source international transportation income, and taxation of distributions to our shareholders;
•our ability to achieve or realize expected benefits from ESG initiatives;
•potential liability from future litigation; and
•other factors detailed in this Report and from time to time in our periodic reports.
Forward-looking statements in this Annual Report are estimates and assumptions reflecting the judgment of senior management and involve known and unknown risks and uncertainties. These forward-looking statements are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those expressed or implied by such forward-looking statements. Accordingly, these forward-looking statements should be considered in light of various important factors, including, but not limited to, those set forth in “Item 3. Key Information—D. Risk Factors” in Atlas’ Annual Report for the year ended December 31, 2021.

We do not intend to revise any forward-looking statements in order to reflect any change in our expectations or events or circumstances that may subsequently arise. We expressly disclaim any obligation to update or revise any of these forward-looking statements, whether because of future events, new information, a change in our views or expectations, or otherwise. You should carefully review and consider the various disclosures included in this Report and in our other filings made with the Securities and Exchange Commission, or the SEC, that attempt to advise interested parties of the risks and factors that may affect our business, prospects and results of operations.


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ITEM 3 — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk from changes in interest rates and foreign currency fluctuations. We use interest rate swaps to manage interest rate price risks. We do not use interest rate swaps for trading or speculative purposes.

Interest Rate Risk

As of December 31, 2021, our variable-rate credit facilities totaled $2.1 billion, of which we had entered into interest rate swap agreements to fix the rates on a notional principal amount of $0.9 billion. These interest rate swaps have a fair value of $22.4 million, net, in the counterparties’ favor.

The tables below provide information about our financial instruments at December 31, 2021 that are sensitive to changes in interest rates. In addition to the disclosures in this report, please read note 8 - "Long-term debt", note 9 – “Operating lease liabilities” and note 10 – “Other financing arrangements” to our consolidated financial statements included in this Report, which provide additional information with respect to our existing credit and lease facilities.

Principal Payment Dates
(in millions of US dollars)20222023202420252026Thereafter
Credit Facilities(1)$527.0 $249.4 $136.1 $136.1 $778.7 $263.3 
Vessel Operating Leases(2)141.4 145.1 149.2 126.4 111.5 107.1 
Sale-Leaseback Facilities(3)101.0 101.4 102.6 97.4 94.2 866.5 
(1) Represents principal payments on amounts drawn on our credit facilities that bear interest at variable rates. We have entered into interest rate swap agreements under certain of our credit facilities to swap the variable interest rates for fixed interest rates. For the purposes of this table, principal payments are determined based on contractual repayments in commitment reduction schedules for each related facility.
(2) Represents payments under our operating leases. Payments under the operating leases have a variable component based on underlying interest rates, calculated using the applicable LIBOR in place as at December 31, 2021.
(3) Represents payments, excluding amounts representing interest payments, on amounts drawn on our sale-leaseback facilities where the vessels remain on our balance sheet and that bear interest at variable rates.

As of December 31, 2021, we had the following interest rate swaps outstanding:

Fixed per annum rate
swapped for LIBOR		Notional amount as of
December 31, 2021
Maximum notional
amount(1)
Effective dateEnding date
5.4200%$269.6 $269.6 September 6, 2007May 31, 2024
1.6490%160.0 160.0 September 27, 2019May 14, 2024
1.6850%110.0 110.0 November 14, 2019May 15, 2024
1.4900%26.9 26.9 February 4, 2020December 30, 2025
0.7270%125.0 125.0 March 26, 2020March 26, 2025
0.6300%92.0 92.0 January 21, 2021October 14, 2026
0.6600%92.0 92.0 February 4, 2021October 14, 2026
(1) Over the term of the interest rate swaps, the notional amounts increase and decrease. These amounts represent the peak notional amount over the remaining term of the swap.

Counterparties to these financial instruments may expose us to credit-related losses in the event of non-performance. As of December 31, 2021, these financial instruments are in the counterparties’ favor. We have considered and reflected the risk of non-performance by us in the fair value of our financial instruments as of December 31, 2021. As part of our consideration of non-performance risk, we perform evaluations of our counterparties for credit risk through ongoing monitoring of their financial health and risk profiles to identify funding risk or changes in their credit ratings.

Counterparties to these agreements are major financial institutions, and we consider the risk of loss due to non-performance to be minimal. We do not require collateral from these institutions. We do not hold and will not issue interest rate swaps for trading purposes.

50


PART II — OTHER INFORMATION

Item 1 — Exhibits
The following exhibits are filed as part of this Report.

Exhibit
Number		Description
15.1Consent of KPMG LLP, relating to the Company Financial Statements

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