What changed in this filing

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Item 1. Business

2022-02-25 compared with 2021-02-26 · 316 added, 179 removed, 302 unchanged (62% of the section changed)

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We service diverse end markets across all sectors of the economy from a network of approximately 275 branch locations and additional drop lots throughout the United States (“US”), Canada, Mexico, and the United Kingdom ("UK").

We are also a leading provider of specialty containment solutions in the US.

With roots dating back more than 60 years, we lease modular space and portable storage units (our “lease fleet”) to customers in the commercial and industrial, construction, education, energy and natural resources, government, and other end markets.

We offer our customers an extensive section of “Ready to Work” solutions.

In addition to our "Ready to Work" solutions, we offer value-added products and services, such as the rental of steps, ramps, and furniture packages, damage waivers, and other amenities to improve the overall customer experience.

We offer our customers an extensive selection of “Ready to Work” solutions.

As part of our "Ready to Work" solutions, we offer value-added products and services, such as the rental of steps, ramps, and furniture packages, damage waivers, and other amenities to improve the overall customer experience.

These turnkey solutions offer customers flexible, low-cost, and timely solutions to meet their flexible work space and storage needs on an outsourced basis.

On July 1, 2020, WillScot Corporation ("WillScot") combined with Mobile Mini, Inc.

("Mobile Mini") in a stock-for-stock merger (the "Merger"), and WillScot changed names to WillScot Mobile Mini Holdings Corp.

WillScot Mobile Mini is the holding company for the Williams Scotsman and Mobile Mini family of companies.

As a result of the Merger, the Company operates in four reportable segments as follows:

("Mobile Mini") in a stock-for-stock merger (the "Merger"), and WillScot changed its name to WillScot Mobile Mini Holdings Corp.

WillScot Mobile Mini is the holding company for the Williams Scotsman and Mobile Mini families of companies.

The Company operates in four reportable segments as follows:

North America Modular Solutions ("NA Modular"), North America Storage Solutions ("NA Storage"), United Kingdom Storage Solutions ("UK Storage"), and Tank and Pump Solutions ("Tank and Pump").

The NA Modular segment aligns with the WillScot legacy business prior to the Merger, and the NA Storage, UK Storage, and Tank and Pump segments align with the Mobile Mini segments prior to the Merger.

Within this Annual Report, we have presented certain financial information on a pro forma basis and supplemental pro forma financial statements within Management’s Discussion and Analysis of Financial Condition and Results of Operations to include Mobile Mini's results as if the Merger and related financing transactions had occurred on January 1, 2019, as we believe this is a better representation of the go-forward combined company and is useful to investors.

Prior to the third quarter of 2021, the NA Modular segment aligned with the WillScot legacy business prior to the Merger, and the NA Storage, UK Storage, and Tank and Pump segments aligned with the Mobile Mini segments prior to the Merger.

During the third quarter of 2021, the majority of the portable storage product business within the NA Modular segment was transitioned to the NA Storage segment, and associated revenues, expenses, and operating metrics beginning in the third quarter of 2021 were transferred to the NA Storage segment.

Within this Annual Report on Form 10-K, we have presented certain financial information on a pro forma basis and supplemental pro forma financial statements within Management’s Discussion and Analysis of Financial Condition and Results of Operations to include Mobile Mini's results as if the Merger and related financing transactions had occurred on January 1, 2019, as we believe this is a better representation of the go-forward operations of the combined company, and we believe this information is useful to investors in order for them to better understand the combined historical financial results of the legacy businesses for comparative purposes.

Products and Services

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Our units are transported by truck, either towed (if fitted with axles and hitches) or mounted on flat-bed trailers.

Modular space units have attractive economic characteristics, and our ability to lease and maintain our assets’ profitability over economic lives, which often exceed 20 years, is a unique capability and competitive advantage.

Modular space units have attractive economic characteristics, and our ability to lease and maintain our assets’

profitability over economic lives, which often exceed 20 years, is a unique capability and competitive advantage.

We utilize standard fleet maintenance procedures across the branch network, monitor fleet condition and allocate capital expenditures centrally, and ensure all units meet consistent quality and condition requirements, regardless of unit age, prior to delivery to a customer.

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These units offer maximum ease of installation and removal and are deployed across the broadest range of applications in our fleet.

These units typically have “open interiors,” which can be modified using movable partitions, and include tile floors, air conditioning, heating, and filtration units, partitions and, if requested, toilet facilities.

Section Modulars and Redi-Plex.

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Examples of section modular units include hospital diagnostic annexes, special events headquarters, temporary data centers, and larger general commercial offices.

Classroom units are generally double-wide units adapted specifically for use by school systems or universities.

Classroom units are generally double-wide units or Flex panelized units adapted specifically for use by school systems or universities.

Classroom units usually feature teaching aids, air conditioning, heating, and filtration units, windows and, if requested, toilet facilities.

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Steel containers have a long useful life with no technical obsolescence.

Our portable storage containers have estimated useful lives of 30 years from the date we build or acquire and remanufacture them, with average residual values in excess of 50%.

Our portable storage containers generally have estimated useful lives of 30 years from the date we build or acquire and remanufacture them, with average residual values in excess of 50%.

We maintain our steel containers on a regular basis by removing rust, painting them with rust inhibiting paint, plug‑welding holes, and occasionally replacing the wooden floor or a rusted steel panel.

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We operate a hybrid in-house and outsourced logistics and service infrastructure that provides delivery, site work, installation, disassembly, unhooking and removal, and other services to our customers for an additional fee as part of our leasing and sales operations.

Revenue from delivery, site work, and installation results from the transportation of units to a customer's location, site work required prior to installation, and installation of the units which have been leased or sold.

Typically, modular units are placed on temporary foundations constructed by our in‑house service technicians or

subcontractors.

Revenue from delivery, site work, and installation results from the transportation of units to a customer's location, as well as site work required prior to installation, and installation of the units which have been leased or sold.

Typically, modular units are placed on temporary foundations constructed by our in‑house service technicians or subcontractors.

These in‑house service technicians or subcontractors also generally install any ancillary products and VAPS.

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Product Leases

We primarily lease our modular and portable storage units to customers, which results in a highly diversified and predictable recurring revenue stream.

For the year ended December 31, 2020, o ver 90% of new lease orders were on our standard lease agreement, pre-negotiated master lease, or national account agreements.

We primarily lease, rather than sell, our modular and portable storage units to customers, which results in a highly diversified and predictable recurring revenue stream.

For the year ended December 31, 2021, over 90% of new lease orders were on our standard lease agreement, pre-negotiated master lease, or national account agreements.

The initial lease periods vary, and our leases are customarily renewable on a month-to-month basis after their initial term.

For the year ended December 31, 2020, the average effective duration of our consolidated lease portfolio was approximately 32 months.

For the year ended December 31, 2021, the average effective duration of our consolidated lease portfolio for modular space and portable storage units was over 31 months.

As a result, our lease revenue is highly predictable due to its recurring nature and the underlying stability and diversification of our lease portfolio.

For the year ended December 31, 2020, o ur average minimum contractual lease term at the time of delivery in our NA Modular segment for modular space units and portable storage units was 11 months and 7 months, respectively.

For the year ended December 31, 2021, our average minimum contractual lease term at the time of delivery in our NA Modular segment for modular space units was 11 months.

However, given that our customers value flexibility, they consistently extend their leases or renew on a month-to-month basis such that the average effective duration of our NA Modular segment lease portfolio was over 35 months.

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The rental continues until cancelled by the customer or us.

On average, steel storage containers on rent in our NA Storage and UK Storage segments for the year ended December 31, 2020 had been in place for over 31 months, and the steel ground level offices on rent for the year ended December 31, 2020 had been in place for approximately 15 months.

On average, steel storage containers on rent in our NA Storage and UK Storage segments for the year ended December 31, 2021 had been in place for over 31 months, and the steel ground level offices on rent for the year ended December 31, 2021 had been in place for over 15 months.

Rental contracts provide that the customer is responsible for the cost of delivery and pickup and specify that the customer is liable for any damage done to the unit beyond ordinary wear and tear.

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The rental duration varies widely by application, and the rental continues until the unit is returned in clean condition to us.

On average, contracts in our Tank and Pump Solutions segments for the year ended December 31, 2021 had been in place for over 8 months.

Rental contracts specify that the customer is responsible for carrying commercial general liability insurance, is liable for any damage to the unit beyond ordinary wear and tear, and for all materials the customer contains in rented equipment.

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Demand for our products varies by end market.

Construction customers typically reflect higher demand during months with more temperate weather, while demand from large retailers is stronger from September through December, when

more space is needed to store holiday inventories.

Construction customers typically reflect higher demand during months with more temperate weather, while demand from large retailers is stronger from September through December, when more space is needed to store holiday inventories.

Retail customers usually return these rented units in December and early in the following year, but also undertake ongoing rolling store renovations which present consistent recurring demand throughout the year.

In our Tank and Pump Solutions business, demand from customers is typically higher in the middle of the year from March to October, driven by the timing of customer maintenance projects.

As of December 31, 2020, we had over 368,000 total units including over 157,000 modular space units, over 197,000 portable storage units, over 12,500 tank and pump units, and other value-added products representing fleet net book value of $2.9 billion.

As of December 31, 2021, we had approximately 390,000 total units including over 162,000 modular space units, over 213,000 portable storage units, over 13,000 tank and pump units, and other value-added products representing fleet net book value of $3.1 billion.

Approximately 111,000 of our modular space units, or 68% and 180,000 of our portable storage units, or 84% were on rent as of December 31, 2021, and tank and pump Original Equipment Cost ("OEC") utilization was 73.5% as of December 31, 2021.

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We also offer delivery, installation, and removal-related services for an additional fee as part of our sales operations.

Our customers operate in a diversified set of end markets, including construction, commercial and industrial, retail and wholesale trade, education, energy and natural resources, government, and healthcare.

Core to our operating model is the ability to redeploy standardized assets across end markets.

We have recently serviced emerging demand in the healthcare and government sectors related to COVID‑19, as well as expanded space requirements related to social distancing.

We track several market leading indicators in order to predict demand, including those related to our two largest end markets, the commercial and industrial end market, and the construction end market, which collectively accounted for approximately 43% and 42% of our pro forma revenues, respectively, for the year ended December 31, 2020.

Our customers operate in a diversified set of end markets, including construction, commercial and industrial, retail and wholesale trade, energy and natural resources, education, government and institutions, and healthcare.

Core to our operating model is the ability to redeploy standardized assets across end markets, as we did in 2020 and 2021 to service emerging demand in the healthcare and government sectors related to COVID‑19, as well as expanded space requirements related to social distancing.

We track several market leading indicators in order to predict demand, including those related to our two largest end markets, the commercial and industrial segment and the construction segment, which collectively accounted for approximately 47% and 40% of our revenues, respectively, for the year ended December 31, 2021.

In order to optimize the use of fleet assets across our branch network, we centrally manage fleet rebalancing across our end markets.

This allows us to serve 15 distinct end markets in which no customer accounted for more than 2% of pro forma revenue for the year ended December 31, 2020.

For the years ended December 31, 2020, 2019, and 2018, no one customer accounted for more than 3% of our total pro forma revenues.

For the year ended December 31, 2020, no one customer accounted for more than 2% of pro forma revenues, our top 10 customers accounted for approximately 6% of pro forma revenues, and our top 50 customers accounted for less than 13% of revenues on a pro forma basis, reflecting low customer concentration and significant project diversification within our portfolio.

Our logistics and service infrastructure is designed to enable us to meet or exceed our customers’ expectations by reacting quickly, efficiently, and with consistent service levels.

As a result, we have established strong relationships with a diverse customer base, ranging from large multinational companies to local sole proprietors.

Including customers acquired from Mobile Mini, we served over 85,000 unique customers in 2020.

This allows us to serve 15 distinct end markets in which no one customer accounted for more than 2% of revenues for the year ended December 31, 2021.

For the year ended December 31, 2021, our top 10 customers accounted for approximately 5% of revenues, and our top 50 customers accounted for less than 13% of revenues, reflecting low customer concentration and significant project diversification within our portfolio.

Our logistics and service infrastructure is designed to meet or exceed our customers’ expectations by reacting quickly, efficiently, and with consistent service levels.

As a result, we have established strong relationships with a diverse customer

base, ranging from large multinational companies to local sole proprietors.

We served over 85,000 unique customers in 2021.

We believe that our customers prefer our modular space and portable storage products over fixed, on-site built space because they are a quick, flexible, cost-effective, and low-risk solution for temporary or permanent expansion or storage.

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On a stand‑alone basis, retail and wholesale trade customers comprised approximately 11% of fiscal year 2021 rental revenue.

on a pro forma basis, these customers comprised approximately 12% of fiscal year 2020 rental revenue.

Energy and Natural Resources

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North American Leader in Turnkey Modular Space and Portable Storage Solutions

The Mobile Mini Merger brought together WillScot’s leading modular space capabilities and Mobile Mini’s leading portable storage solutions to create an industry-leading specialty leasing platform.

We benefit from complementary capabilities, a diverse customer base with over 85,000 customers across different end markets, and an unrivaled geographic footprint of approximately 275 branch locations and additional drop lots.

The Mobile Mini Merger brought together WillScot’s leading modular space capabilities and Mobile Mini’s leading portable storage solutions to create an industry-leading business services provider specializing in innovative flexible work space and portable storage solutions.

We benefit from complementary capabilities, a diverse customer base with over 85,000 customers across different end markets, and a geographic footprint of approximately 275 branch locations and additional drop lots.

Our broad and complementary network serves the largest North American metropolitan areas with local teams who are experts in their respective markets.

Our cost‑effective coverage model serves smaller customers at the local and regional level, while also addressing the needs of larger national customers looking for a full suite of high-quality services that can be provided on a consistent basis throughout North America.

Since geographic proximity to customers can be a competitive advantage in the modular space and portable storage industry, we believe that our extensive branch network allows us to better serve existing customers and attract new customers.

Since geographic proximity to customers is a competitive advantage in the modular space and portable storage industry, we believe that our extensive branch network allows us to better serve existing customers and attract new customers.

We believe our extensive scale results in significant operational benefits, such as optimization of fleet yield and utilization, efficient capital allocation, superior service capabilities, and the ability to offer consistent "Ready to Work" solutions across all of our branch locations.

We deliver "Ready to Work" solutions through our growing offering of VAPS, such as the rental of steps, ramps, furniture packages, damage waivers, and other amenities.

This thoughtfully curated portfolio of VAPS makes modular space and portable storage units more productive, comfortable, and secure for our customers and allows us to generate higher revenue per transaction and return on capital.

These turnkey solutions offer customers flexible, low‑cost, capital efficient, and timely solutions to meet their space needs on an outsourced basis.

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We believe our ability to drive VAPS growth following our historical acquisitions highlights the value proposition our VAPS provide to our customers.

We expect to replicate a similar cross‑selling opportunity within Mobile Mini’s ground level offices.

During 2021, we introduced a similar cross-selling opportunity within ground level offices in the NA Storage segment.

We are also introducing an innovative "Ready to Work" storage solution with VAPS such as integral tool racking, storage desks and charging stations, shelving, lighting and locks.

Sophisticated Logistics and Service Capabilities

Building off of the largest branch network in the industry, we operate a sophisticated hybrid in-house and outsourced logistics and service infrastructure that we believe is highly differentiated from our competitors and enhances the value proposition we provide to customers.

Building from the largest branch network in the industry, we operate a sophisticated hybrid in-house and outsourced logistics and service infrastructure that we believe is highly differentiated from our competitors and enhances the value proposition we provide to customers.

Precise scheduling of installations and removals, same-day delivery capabilities on certain products, and ability to mobilize large volumes of equipment in any geography serviced by our branch network are all unique capabilities that differentiate WillScot Mobile Mini, particularly among more demanding customer segments.

We believe that continuing to further optimize our logistics and service capabilities through the deployment of technology is an opportunity for further cost efficiency and differentiation with our customers.

Investments in Technology Provide a Competitive Advantage Over Our Small and Midsize Competitors

We believe our technology serves as a primary differentiator over small and midsize competitors in local markets and initiatives underway to consolidate our operations onto our state of the art SAP enterprise resource planning platform will result in further efficiencies.

We believe that continuing to further optimize our logistics and service capabilities through the deployment of technology and in-sourcing our services is an opportunity for further cost efficiency and differentiation with our customers.

Investments in Technology

We believe our technology serves as a primary differentiator relative to our competition and is a key component of our customer value proposition.

Initiatives underway to further leverage our state of the art SAP enterprise resource planning platform will result in further operating efficiencies and enhance the overall customer experience.

Effective use of real‑time information allows us to monitor and optimize the utilization of our fleet, allocate our fleet to the highest demand markets, optimize pricing, and determine the best allocation of our capital to invest in fleet and branches.

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Similarly, technology is continuing to develop related to our fleet to offer an enhanced experience for our customers.

Unit tracking, electronic locking/security systems, and other customer‑facing technological benefits differentiate our fleet from competitors who have not invested in these capabilities.

Unit tracking, customer service portals, and other customer‑facing technological benefits differentiate our offering from competitors who have not invested in these capabilities.

We believe we possess superior technology infrastructure relative to our competition and we intend to extend this advantage further by leveraging our infrastructure investments.

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Our customers operate in a diversified set of end markets, including commercial and industrial, construction, education, energy and natural resources, government, and other end markets.

For the year ended December 31, 2020, the top 50 combined customers for WillScot Mobile Mini accounted for less than 13% of pro forma revenues.

For the year ended December 31, 2021, the top 50 customers for WillScot Mobile Mini accounted for less than 13% of total revenues.

We believe that the diversity of our customer end markets reduces our exposure to changes related to a given customer, shifts within an industry or geographic region, and end market industry seasonality, while also providing significant opportunities to grow our business.

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Accordingly, our business has been able to support front‑line workers and other essential businesses during the COVID‑19 crisis by providing temporary testing sites, treatment centers, exam rooms, hospital swing space, temperature screening checkpoints, office space to support social distancing, and storage for related supplies.

The following chart illustrates the breakdown of our customers and revenue by end markets, on a pro forma basis, as of December 31, 2020.

The following chart illustrates the breakdown of our customers and revenue by end markets as of December 31, 2021.

In order to optimize the use of fleet assets across our branch network, we centrally manage fleet rebalancing across our end markets.

This allows us to serve 15 distinct end markets in which no customer accounted for more than 2% of pro forma revenue for the year ended December 31, 2020.

This allows us to serve 15 distinct end markets in which no customer accounted for more than 2% of revenue for the year ended December 31, 2021.

REVENUE MIX BY END MARKET CUSTOMER CONCENTRATION

Attractive Cost and Revenue Synergy Opportunities with the Ability to Leverage Best Practices Across Both Companies

We have a strong track record of integrations generating significant synergies with our acquisitions of Modular Space Holdings, Inc.

("ModSpace"), Onsite Space LLC ("Tyson"), and Acton Mobile Holdings LLC ("Acton"), driving $61.0 million in cumulative annual synergies achieved as of December 31, 2020, and an additional $10.2 million in remaining synergies expected to be realized in the future.

We anticipate approximately $50 million of annual cost savings opportunities from the combination with Mobile Mini from purchasing and procurement economies of scale and general and administrative expense savings, particularly with respect to the consolidation of corporate‑related functions and elimination of redundancies.

Similar to the ModSpace integration, we expect to incur approximately $75 million of one‑time cash integration, capital investment, restructuring, lease impairment, and other related charges in the first two years post-closing to realize the annual recurring cost savings.

These costs will be incurred to integrate and consolidate information technology systems and for other consulting costs, breakage costs for redundant and overlapping leased facilities, fleet relocation costs, severance, and other personnel costs.

We anticipate approximately 80% of these cost savings to be realized in our run rate by the end of 2022.

However, there is no guarantee that we will achieve these cost savings in the amount or in the time frame that we anticipate.

See “Risk Factors—Risks Relating to the Mobile Mini Merger—We may be unable to successfully acquire and integrate new operations, including Mobile Mini and our conversion to its SAP enterprise resource planning system, which could cause our business to suffer."

Proven Track Record Realizing Acquisition Synergies and Deploying Best Practices

We have a strong track record of integrations generating significant synergies with our acquisitions of Mobile Mini, Modular Space Holdings, Inc.

("ModSpace"), Onsite Space LLC ("Tyson"), and Acton Mobile Holdings LLC ("Acton").

During the year ended December 31, 2021, the Company acquired certain assets and liabilities of seven regional modular space and storage businesses and quickly integrated these assets into our leasing portfolio and branch network.

Opportunities such as these allow us to reach new customers, expand our product and service offering, and provide further opportunities for revenue and cost synergies.

See “Risk Factors—We may be unable to successfully acquire and integrate new operations, which could cause our business to suffer."

Our Asset Base Provides Highly Attractive Asset-Level Returns with Long Useful Lives

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As such, we have made significant investments in our lease fleet and consolidated several competitors.

For the year ended December 31, 2020, our modular space and portable storage lease fleet consisted of over 121 million square feet of relocatable space, comprising over 157,000 units, and over 197,000 storage solutions containers and office units.

We believe we generate an attractive internal rate of return ("IRR") in our modular space portfolio driven by the long economic life of our fleet, exceeding 20 years on average, inclusive of any capital expenditure ("capex") required to maintain the fleet to its value maximizing earning potential.

Adding VAPS to our modular units increases the IRR of those units over the 20+ year useful life of the asset.

On average, the payback period of a modular unit is only 36 months including VAPS.

Similarly, we believe portable storage containers are able to generate a higher IRR over their 30‑year useful life.

These units require even less maintenance capex and have an average payback period of only 30 months.

We believe the stability of cash flows combined with strong economic returns make both modular space and portable storage containers highly attractive specialty rental asset classes, and our logistics and service capabilities and investments in technology further enhance the returns we can generate from these assets.

For the year ended December 31, 2021, our modular space and portable storage lease fleet consisted of over 129 million square feet of relocatable space, comprising over 162,000 office units and over 213,000 steel container units.

We generate an attractive internal rate of return ("IRR") in our modular space portfolio driven by the long economic life of our fleet, exceeding 20 years on average, inclusive of any capital expenditure ("capex") required to maintain the fleet to its value maximizing earning potential.

On average, the IRR for a modular unit, including VAPS, is over 25%.

Similarly, portable storage containers are able to generate an IRR of approximately 30%.

These units require minimal maintenance capex.

The stability of cash flows combined with strong economic returns make both modular space and portable storage containers highly attractive specialty rental asset classes, and our logistics and service capabilities and investments in technology further enhance the returns we can generate from these assets.

The following chart illustrates the breakdown of the net book value ("NBV") of our rental equipment between the various modular space product types, portable storage and VAPS as of December 31, 2021.

Our Business Generates Predictable Recurring Cash Flow Due to Our Long-Term Leases and Flexible Capex Requirements

Our recurring revenue, combined with our flexible capex requirements, efficient working capital, and tax profile, has allowed us to generate substantial free cash flow, both in periods of growth and economic downturn.

Our recurring revenue, combined with our flexible capex requirements and efficient use of working capital has allowed us to generate substantial free cash flow, both in periods of growth and economic downturn.

The long term nature of our leases, with average lease durations in excess of 31 months as of December 31, 2021, produces strong operating income and predictable cash flow.

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We primarily operate within the modular space, portable storage, and specialty containment markets.

Our services also span across a variety of related sectors, including furniture rental, transportation and logistics, facilities rental services, and commercial real estate.

Our services also span across a variety of related sectors, including furniture rental, transportation and logistics, facilities rental services, job site services and commercial real estate.

Modular Space Market

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Demand for portable storage is driven by a number of factors, including:

• Versatility:

portable storage units can be easily customized to suit customer specifications.

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These features offer additional protection for high‑value goods and inventory.

• Convenience:

portable storage units provide immediate ground‑level access for consumers and can be easily transported in large quantities via truck, rail, or cargo ship.

portable storage units can be easily painted and decorated with company colors and logos and are less conspicuous than other portable storage alternatives such as van trailers.

• Aesthetics:

portable storage units can be easily painted and decorated with company colors and logos and are less conspicuous than other portable storage alternatives.

Specialty Containment Market

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Downstream customers utilize tank and pump equipment and services to manage and remove liquid and solid waste generated by ongoing operating activities as well as turn‑around projects and large‑scale expansion projects.

Upstream customers, who we estimate represent approximately 2% of pro forma rental revenues for the year ended December 31, 2020, tend to rent steel tanks to store and transport water and propellant used in well hydraulic fracturing.

Upstream customers, who we estimate represent approximately 2% of tank and pump revenues for the year ended December 31, 2021, tend to rent steel tanks to store and transport water and propellant used in well hydraulic fracturing.

Other customers utilize a wide variety of our products differentiated by the type of project in which they are engaged.

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We typically compete with one or more local providers in all of our markets, as well as with a limited number of national and regional companies.

Our competitors include lessors of storage units, mobile offices, van trailers, and other structures used for portable storage.

As a provider of portable storage, we also compete with conventional fixed self-storage facilities.

Our competitors include lessors of storage units, mobile offices, van trailers, and other structures used for portable storage, as well as traditional commercial office space and conventional fixed self-storage facilities.

Some of our competitors may have greater market share in certain geographic regions.

Significant modular space and portable storage competitors include McGrath RentCorp, PODS, Pac-Van, ATCO Structures & Logistics, BOXX Modular, and 1-800-PACK-RAT in North America, and Wernick Hire and Elliott in the UK.

Significant modular space and portable storage competitors include McGrath RentCorp, PODS, United Rentals, ATCO Structures & Logistics, BOXX Modular, and 1-800-PACK-RAT in North America, and Wernick Hire and Elliott in the UK.

Numerous other regional and local companies compete in individual markets.

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Our competitors include United Rentals, Rain For Rent, Adler Tanks, Sprint/Republic Services, and numerous other smaller competitors.

Strategic Acquisitions

We believe the scalability of our branch network, corporate and shared services infrastructure, technology, and processes allows us to integrate acquisitions efficiently, realize cost savings, cross-sell VAPS, and improve the yield on acquired assets.

As such, we manage an active acquisition pipeline and consider acquisitions to be an important component of our growth strategy.

Our Business and Growth Strategies

We intend to maintain a leading market position and increase our revenue and profitability by pursuing the following strategies, all of which we have demonstrated in our historical operating performance:

Expand Penetration of Value-Added Products and Services

As of December 31, 2021, we estimate that we have an organic revenue growth opportunity of over $150 million as the average VAPS rate of our units on rent in our NA Modular segment converges over time to the VAPS price and penetration levels achieved on our most recently delivered units.

We believe this growth opportunity could be substantially larger if we successfully penetrate more of our modular space orders, and expand our VAPS offering for portable storage units.

Optimize Rate Across Fleet

We continue to advance multiple pricing strategies across our fleet to drive revenue growth.

Leveraging our expertise developed in NA Modular, we plan to implement dynamic pricing, customer segmentation, and contract standardization in our other segments.

Our long history of success, demonstrated by 17 consecutive quarters of double-digit rate growth as of December 31, 2021 in the US within our NA Modular segment, gives us confidence that we can successfully deploy this strategy.

The turnover of our fleet, with average lease durations of nearly three years, creates natural and recurring opportunities to capture incremental price increases.

As the market leader in our industry, we offer the broadest fleet portfolio, the most differentiated turnkey VAPS, and the most consistent service capabilities across the largest branch network to help our customers be 'Ready to Work'.

Enhance Market Penetration Between Segments

The combination of WillScot and Mobile Mini created a leading business services provider specializing in innovative flexible work space and portable storage solutions.

At the outset of the Merger, we recognized that there was 80% end-market overlap and 40% customer overlap, a clear strategic opportunity for our complementary product lines.

By offering a combined product suite, we simplify our customers' procurement needs and enable productivity from start to finish for projects.

We believe cross-selling will also increase utilization and yield of our combined fleet.

Our sales force is optimally positioned to improve efficiency by leveraging our management information systems and using real-time information to monitor and optimize conversion of customer opportunities across our core segments.

In turn, we expect that our broadened and enhanced fleet will attract new customers, increase customer retention, and increase margins and return on invested capital.

Generate Cash Flow Through Operational Efficiencies, Cost Reductions, and Technology

We are implementing many initiatives designed to improve operations and increase profitability.

We continually assess our branch operating footprint, vendor base, and operating structure to maximize revenue generation while minimizing costs.

The Merger provides us with increased scale, numerous operational best practices from both the legacy WillScot and legacy Mobile Mini businesses, and a state-of-the-art SAP ERP platform, all of which we believe will significantly improve our operating efficiency over time.

We have a proven track record of efficiently integrating acquisitions and quickly eliminating operational redundancies while maintaining acquired customer relationships.

Deploy Capital to Strategically Support Organic Growth and Optimize Returns

We maintain a disciplined focus on our return on capital and invest opportunistically across multiple uniquely attractive asset classes, prioritizing our investments to where we see the strongest potential returns.

We continually assess both our existing lease fleet and customer demand for opportunities to deploy capital more efficiently.

We manage our maintenance capex and growth capex to align with the economic conditions in which we operate.

Within our existing lease fleet, we examine the potential cash and earnings generation of an asset sale versus continuing to lease the asset.

In addition, we examine the relative benefits of organic expansion opportunities versus expansion through acquisition to obtain a favorable return on capital.

Leverage Scale and Organic Initiatives with Accretive Acquisitions

Our markets for modular space and portable storage solutions are fragmented.

We estimate that approximately 55% of the modular market and approximately 70% of the portable storage market in North America are supplied by regional and local competitors.

We have the broadest network of operating branches in North America, as well as a scalable corporate center and information technology systems, which position us to continue to acquire and integrate other companies while expanding the products and services available and offered to acquired customers.

During 2021, the Company acquired certain assets and liabilities of several smaller entities, which consisted primarily of 15,700 storage units and 5,800 modular units.

We expect to pursue acquisitions opportunistically that will provide further scale efficiencies and allow us to improve returns generated by the acquired assets.

Use Free Cash Flow to Drive Value Creation

Our free cash flow generation has accelerated rapidly in recent years, and we expect this trend to continue as we execute our strategy.

While we see numerous organic and inorganic opportunities to re-invest in our core businesses, we believe we can generate surplus free cash flow with which we can both reduce leverage and return capital to shareholders over time.

We view this as an additional powerful value creation lever, and we are committed to deploying this capital as productively as possible in the interests of our shareholders.

Human Capital Management

As of December 31, 2020 , we employe d approximately 4,300 people worldwide, the majority of which are full time.

Of these employees, approximately 3,800 are employed in North America, approximately 370 are employed in the UK, and approximately 100 are employed in Mexico.

We have collective bargaining agreements in portions of our Mexico-based operations representing approximately 2% of our employees.

Approximately 86% of employees work in our branch locations, while 14% serve in various corporate functions.

We have not experienced a strike or significant work stoppage, a nd we consider our rel ations with the labor unions and employees to be good.

Our Chief Human Resources Officer along with other members of our executive leadership team develop and execute our human capital strategy.

This includes attracting, acquiring, developing and engaging talent to deliver our strategy, designing employee compensation and benefits programs, and developing and integrating our inclusion and diversity ("I&D") initiatives.

As of December 31, 2021, we employed approximately 4,700 people worldwide, the majority of which are full time.

Of these employees, approximately 4,320 are employed in North America (the US, Canada and Mexico), and approximately 380 are employed in the UK.

We have collective bargaining agreements in portions of our Mexico-based operations representing approximately 1% of our worldwide employees.

Approximately 87% of employees work in our approximately 275 branch locations and additional drop lots, while 13% of employees serve in various corporate functions.

We have not experienced a strike or significant work stoppage, and we consider our relations with the labor unions and employees to be good.

Our Chief Human Resources Officer ("CHRO") along with other members of our executive leadership team, and with guidance from our board of directors, develops and executes our human capital strategy.

This includes attracting, hiring, developing, retaining and engaging talent to deliver our strategy, designing employee compensation and benefits programs, and developing and integrating our inclusion and diversity ("I&D") initiatives.

Whether at a branch location or onsite with our customer s, our people give us a competitive advantage versus our peers and competitors in the industry.

That differentiation begins with o ur values.

Our values are lived through our employees, acknowledged by our vendors and aligned to the needs of our customers and communities.

Our values provide the basis for our approach to human capital management as well as how we treat our stakeholders.

Company Values

We believe that our people are our most valuable asset.

Our company values are lived through our employees, acknowledged by our vendors and aligned to the needs of our customers and communities.

• Dedicated to Health & Safety:

We are subject to certain environmental, health and safety and other laws and regulations in countries, states or provinces, and localities in which we operate.

We are subject to certain environmental, health and safety regulations as well as other laws and regulations in countries, states or provinces, and localities in which we operate.

Our health and safety programs are designed around global standards with appropriate variations addressing the multiple jurisdictions and regulations, specific hazards and unique working environments of our operations.

We take responsibility for our own well being and for those around us.

Health and safety are first, last and everything in-between.

• Committed to Inclusion & Diversity:

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• Trustworthy & Reliable:

We hold ourselves accountable to do the right thing especially when nobody’s looking.

We hold ourselves accountable to do the right thing.

• Devoted to Our Customers:

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We actively engage in the communities we serve and deliver sustainable solutions.

Elements of Our Human Capital Strategy

The disruption in the labor force in 2020 continued into 2021.

Many of our industry competitors have met these changes with little more than short-term compensation increases.

We have taken a more holistic approach designed to meet our employees where they are at any stage within their lives.

Our employee value proposition is simple:

every day our employees deliver excellent service to our customers, and we are committed to delivering an employee experience that creates opportunity and ensures dignity for every employee.

Our involuntary turn over remains manageable at 23%, and the average tenure of our drivers remains strong at five years, during a period where demand for drivers is increasingly high.

We believe that our strategy with the cornerstones of opportunity and personal dignity gives us an advantage over other companies.

Our offerings are designed to benefit employees and their families, and we continue to develop best in class programs and services that are aligned to deliver

targeted business outcomes that best fuel our growth trajectory.

Through our acquisitions, we believe that we have extended these benefits to a broader employee population while raising the operating standards in our industry.

The following highlights a few of our programs.

Employee Engagement

We are committed to keeping our employees informed and engaged in Company news and events, while helping them connect to our strategy and values.

We share information through a range of channels including direct email and text capabilities, an employee intranet, televisions in our branches and quarterly all-employee town halls.

We actively engage with our employees in topics that impact their experiences at work.

We work with an outside vendor to administer an annual employee engagement survey along with regular pulse surveys to give our teams an active voice on topics that impact them directly.

Their feedback is leveraged to shape policies, processes and other aspects of our workplace.

Learning and Development

Human capital development underpins our efforts to execute our strategy and continue to develop our people, products and services.

We continually invest in our employees’ career growth and provide all employees with a wide range of personal and professional development experiences, both formal and informal, for all stages of their career journey.

Our formal offerings include tuition reimbursement, a diverse curriculum of over 6,000 learning courses, vocational training, and leadership development experiences.

We have organized a proprietary foundational leadership development program, which combines skill building with an opportunity to put skills into practice.

Since 2015, over 500 of our team members have participated in this program.

In 2019, we partnered with a leading graduate business school to launch a targeted executive education program.

And in 2021, we launched our new driver apprentice program to provide development opportunities to employees interested in becoming a Commercial Driver's License ("CDL") Class A driver for the Company.

This new program also created internal development opportunity for current employees to become trainers.

Continual learning and career development is advanced through our in-depth succession planning process where we look across the organization to ensure diversity and inclusion are at the forefront of our human capital management.

We then transition into goal planning and development conversations with employees that are supported by our library of personal and professional development courses, customized training engagements and seminars, conferences, and other training events where employees are encouraged to attend in connection with their job duties and developmental goals.

Inclusion and Diversity

We encourage and empower the diverse voices and contributions of our stakeholders to drive increased market share and global value.

In 2020, we established a role in our human resources department to lead our I&D efforts company-wide.

Our developing inclusiveness resource teams are established to support our employees and provide opportunities for exposure, development, and contribution to the organization.

Environmental and Social Responsibility and Safety

We are committed to upholding the highest standards when it comes to our environmental and social responsibilities, as well as the safety of our employees and our business partners, which we believe serves as a competitive advantage.

We are a sustainable organization with long-lived, reusable and renewable assets that are constantly redeployed to customers with minimal residual environmental impact.

Our policies and practices are evident of our commitment to environmental responsibility and accountability and respect for human rights and fair labor standards.

We have a company-wide focus on safety and have implemented numerous measures to promote workplace safety.

Customers are increasingly focused on safety records in their sourcing decisions due to increased regulations to report all incidents that occur at their sites and the costs associated with such incidents.

Our consolidated Total Recordable Incident Rate ("TRIR") remains well below 1.0, demonstrating what we believe to be exceptional performance in the area of workplace safety.

TRIR is an important safety metric required by the Occupational Safety and Health Administration ("OSHA").

In 2021, we established and held the first meeting of our Inclusion & Diversity Council and launched five Inclusiveness Resource Teams ("IRTs"):

Women of WSMM ("WOW"), Black Organization for Leadership & Direction ("BOLD"), Veterans United, Hispanos, and People Respecting that Identity and Sexuality Matters ("PRISM").

IRTs are voluntary, employee-led groups that foster an inclusive and diverse workplace aligned with our values and strategy.

These groups were established to support our employees and provide opportunities for exposure, development and contribution to the organization.

The tone for I&D in our Company starts at the top with our executives and is bolstered with support from our board of directors.

The Inclusion & Diversity Council is a cross-functional team of leaders, including our CEO, CHRO, and divisional senior vice presidents, that acts as a steering committee to help guide our I&D efforts globally.

We expect to achieve the Company’s aspirations by (i) having regular board oversight of the Company’s I&D efforts, and (ii) improving I&D initiatives throughout the complete lifecycle of employee engagement (from recruitment, through development and advancement).

We have trained hundreds of leaders in our organization on unconscious bias and provided I&D e-learning opportunities to our employees.

Our CEO and CFO have I&D metrics as part of their compensation and performance targets.

Rewards, Health & Well Being

We crafted our total rewards strategy with a strategic focus on the health and well being of our employees.

We do this, in part, by ensuring competitive pay at every level of the organization.

We employ human capital consultant data to set and maintain pay ranges and pay levels across the organization.

Incentives are designed to reward eligible employees commensurate with Company performance.

Depending on the position, incentives may be either individually based (sales commissions), group-based (regional performance bonuses), or Company-based (corporate and executive employees).

Executive compensation is reviewed and analyzed via an independent third-party consultant and approved by the compensation committee of our board of directors.

The consultant takes peer group data and general market data into account, when providing pay guidance, to ensure executive pay is both competitive and reasonable, based on the prevailing market standards.

Our approach to our benefits begins with a centralized focus on the employee.

We use high deductible healthcare plans to promote positive consumer behaviors and pay approximately 70% of the cost of the employee premiums.

We mitigate the burden to the employee from these plans by seeding their health savings accounts (“HSA”) at the beginning of each year, covering between 35% and 50% of employee deductibles.

We also provide a biometric screening incentive in the form of an additional HSA contribution.

HSA incentives are used to promote behaviors as needed, such as compliance with federal, state and local COVID-19 requirements and guidance.

We have an employee assistance program to provide counseling sessions for every employee as they are needed.

Wellness does not end with physical and mental health.

We also offer several ways for our employees to feel prepared financially.

Along with our 401(k) matching, we offer several educational services employees can use to strengthen their financial acumen.

Additionally, we provide short-term disability pay at 100% of annualized wages for approved cases, and support can last up to 26 weeks.

We offer paid parental leave for those employees who expand their families, as well.

Regardless of the hurdles our employees face we are prepared to support them through their major life events and times of need.

Our employees are doing their part to support each other as well.

The Minions of Kindness Fund is an employee-led 501(c)(3) organization that uses employee donations to support WillScot Mobile Mini employees in times of distress.

Our Approach to Environmental, Social and Governance

We are committed to upholding high standards when it comes to our environmental, social and governance ("ESG") responsibilities, as well as the safety of our employees and our business partners.

The principal products we provide to our customers are long-lived, reusable and relocatable assets that produce minimal waste.

For decades, we have committed ourselves to circular economic practices to reuse as many of the assets as possible.

Our board of directors, at the direction of its nominating and corporate governance committee, is actively involved in the development of our ESG strategy and approach.

Over the next several years, we will focus on numerous goals in the areas of ESG:

• Environmental - Our commitment to environmentally sound business practices includes three key areas of focus:

◦ reducing greenhouse gas emissions as part of our operations;

◦ reducing the amount of waste we deliver to landfills;

◦ improving the energy efficiency of our products.

• Social - We are committed to socially responsible business practices throughout our operations.

We have focused especially on improving diversity, equity, and inclusion throughout our organization, and on improving the communities in which we work.

Our five areas of focus in this regard are to:

◦ improve inclusion and diversity across the organization (as described above);

◦ focus on community partnering across all of our locations;

◦ remain diligent in placing safety first, always;

◦ improve health and wellness opportunities for all our employees (as described above);

◦ improve customer engagement and relations.

◦ Continue to align our corporate governance structure with our ESG strategy

◦ Improve the diversity of our Board and management

In the near term, we are pursuing the following five key strategic initiatives to drive increased benefits for our stakeholders.

Reduce, reuse, recycle with our modular and storage units and VAPS

Reducing greenhouse gas emissions from our owned trucking and yard fleet

• Health & Safety:

Health & Safety First at our branches, on the road and at our customer sites

Ensuring every employee has the opportunity to thrive and seek upward mobility

Leveraging our scale to lift up all 275+ of our communities and amplify our impact

Environmental

Circular Business Model (Materials)

We lease commercial grade office and storage units that are designed to be reused, relocated and reconfigured and have refurbishment capabilities for our office units.

These assets are cycled to different customers seven times over their 20-year lifetime with a minimal refresh or get ready before each new cycle.

We then layer on refurbishment, which can extend the asset life by another 10 years.

With the cost of refurbishment at only 20-30% of the cost of a new unit, it’s more capital efficient to refurbish our units and it extends the life significantly.

Our newest office space, called FLEX, is a panelized product which means that the panels, or walls, can be reconfigured and reused, thus eliminating wood waste.

We also have modernization facilities to put our storage assets, which we acquire used, into service as a storage unit.

Value Added Products (“VAPs”) adds another dimension to our circular story because we are able to reuse, repair, and maintain VAPs that come off rent, which helps drive better margins and growth.

In addition, putting VAPs into our circular business model significantly reduces material usage both for us and for our customers, who otherwise buy and dispose of their VAPs at the end of the project.

Circular by design, our lease and renew business model helps us to reduce material usage, emissions and costs, while helping our customers with their ESG goals.

GHG Emissions (Climate)

Compared to other industrial companies, our greenhouse gas footprint and risk is small, but we can still produce positive impacts that directly align with cost efficiency and customer benefits.

To reduce greenhouse gas emissions and other air quality impacts from our diesel-fueled delivery and setup fleet, we have begun replacing older diesel truck engines with modern, efficient engines, and are working to test delivery trucks fueled by renewable natural gas.

Over time, these efforts will help to reduce our fuel costs and risks, while also helping us secure contracts with like-minded customers.

Protection of people and the environment is a core value at WillScot Mobile Mini.

It is a key component of our Sales, People and Operational Excellence priorities.

These priorities are the driving force that shapes who we are and what we do.

WillScot Mobile Mini fosters an environment in which our employees feel empowered and choose to make the safest and best decisions possible.

Safety extends beyond our branches and yards and includes travel on roads and highways and our activities at customer sites.

Today, we are operating at high levels of safety and low levels of injury.

Our Total Recordable Incident Rate (“TRIR”) is 0.82 incidents per labor hour, compared to the 2.5 incidents per labor hour rate for the construction industry as reported by the Bureau of Labor Statistics.

We are using technology to assist our drivers and other team members in the safety arena.

In 2020, we created an assessment tool, our “Safety Save” application, that tracks leadership safety engagement and measures the number of safety engagements as our team members complete them.

Any employee is encouraged to complete a safety assessment on an observation of a task, tool, behavior or other condition during working duties.

Use of the Safety Save application is just one manner we use to manage safety leadership at all levels.

Further, we use and are expanding a vehicle/truck-based camera system used to improve driving behaviors.

Lastly, we maintain a safety assessment program that drives increased focus to our Health & Safety core value, by providing increased visibility.

Our goal is to help each team member succeed and enjoy a safe working experience.

We know no business can exist without people.

Who we are as people ultimately defines what we are as a business, and safety is everyone’s responsibility.

COVID-19 Safety Protocols

Our business, along with the rest of the world, faced unprecedented challenges in 2020 due to the impact of COVID-19.

We remained dedicated to protecting the health and safety of our employees, vendors, and customers and adjusted our business to meet various country, state, and local requirements.

We are considered an “essential business” and our employees are considered “essential workers”.

We have continued to service our customers throughout the pandemic, while implementing robust health and safety protocols to protect our employees and customers, and we believe these robust protocols have differentiated us as a sophisticated partner in the eyes of our more demanding customer segments.

We follow US Centers for Disease Control and Prevention and/or applicable country, state and local guidelines at the locations where we operate.

To comply with public health guidance and reduce the risk of COVID-19 transmission, employees are required, prior to commencing work at our facilities and offices each day, to check their temperature and complete a daily symptom certification that is documented and reviewed by our COVID-19 team members.

We provide masks and hand sanitizer to our employees, as well as require adherence to appropriate social distancing practices and regularly recurring cleaning/sanitization protocols at our locations.

COVID-19 testing for employees is covered by insurance and we actively track key COVID-19 metrics.

We have also deployed robust remote-work capabilities and technology across the workforce providing employees flexibility to operate when not required to be on-site at a company location.

Health & Wellness

The health and wellness of our employees is an extremely important facet of our workplace environment.

We offer several health and wellness incentives to our employees.

Our employee assistance program ("EAP") provides a variety of services to employees in need and was especially important during 2020 as COVID-19 impacted our workforce in different ways.

We responded to the pandemic by continuing to prioritize employee health and safety as we conducted our business.

Employee Engagement

We believe that engaged employees are vital to continued business success.

As such, we provide consistent touchpoints with employees to ensure that we have a strong understanding of employee sentiment.

We have creative programming throughout the year designed to provide engagement opportunities for our workforce that unifies us, even as physical distance separates us.

These touchpoints became increasingly more important in 2020 due to the impact of the COVID-19 pandemic.

Talent and Recruitment

We work diligently to attract top talent from a variety of sources to meet the current and future demands of our business.

We have a strong employee value proposition that leverages our collaborative working environment, shared commitment to our company values.

We strive to balance the recruitment of best-in-class external resources with the development and advancement of our in-house talent to foster a rich diversity of skills and perspectives, which we believe is an important source of competitive advantage.

Community and Partnering

We are proud to make a difference in places that we live and work.

We strive to help our communities and hometowns by giving our time and talent to improve our surroundings.

Our employees are encouraged to utilize up to 16 hours of paid time off to volunteer in their local communities.

We have numerous partnerships with charitable organizations across the country that allow our employees to get involved and give back.

Many of our senior leaders serve on boards of non-profit organizations.

In 2020, we and our employees generously gave over $420,000 to a variety of causes that improve and advance our local communities.

Total Rewards or Pay Equity

We provide market competitive compensation and benefit packages to our employees.

Beyond base compensation, we also offer short and long-term incentive programs, 401(k) with employee matching opportunities, healthcare and insurance benefits, health savings and flexible spending accounts, paid time off, family leave and tuition reimbursement among others (programs may vary by country/region, job level, and time with the organization).

We obtain annual employee feedback on the

benefits we offer to ensure that we continue to offer competitive packages that appeal to top talent and allow us to recruit and retain our human capital.

We remain dedicated to protecting the health and safety of our employees and customers and have adjusted our business to meet various country, state, and local requirements.

We are considered an “essential business” and our employees are considered “essential workers.” We have continued to service our customers throughout the pandemic, while implementing robust health and safety protocols to protect our visitors, employees and customers.

We follow US Centers for Disease Control and Prevention, OSHA and/or applicable country, state and local guidelines at the locations where we operate.

To comply with public health guidance and reduce the risk of COVID-19 transmission, unvaccinated visitors, customers and employees are required, prior to commencing work at our facilities and offices each day, to check their temperature and complete a daily symptom certification that is documented and reviewed by our COVID team members.

We provide masks and hand sanitizer to our visitors, customers, and employees, as well as require adherence to appropriate social distancing practices.

We have also enhanced cleaning/sanitization protocols at our locations.

COVID-19 testing for employees is covered by our health insurance and we actively track key COVID metrics.

Additionally, we are providing an incentive to our employees that choose to get vaccinated, as well as paid time off for vaccination and any side effects.

We also meet all client requirements for site access or general compliance with their required COVID protocols.

We remain flexible to the situation, and keep our employees informed of the current best guidance, as provided by professionals and experts.

Community engagement is at the heart of our business.

Due to our scale, we bring new engagement opportunities to our entire workforce in two ways.

We recently launched our giving platform called "Give Where You Live" where employees can partner with the local charity of their choice across all 275 of our locations in the way that is most meaningful to them.

We encourage our employees to give their time, talent and/or treasure locally to our core four causes of Shelter, Hunger, Education, and Health & Wellness.

We have expanded our existing Company match program and have created a volunteer rewards program to encourage increased volunteerism globally.

Our IRTs support our community-focused values through volunteer opportunities that are meaningful to the populations that they represent.

We also have Company-wide partnerships like Habitat for Humanity, where we are able to provide giving opportunities in the normal course of business, like the temporary use of our storage containers at Habitat build sites.

We know that when we give where we live, we can make a difference.

Good governance enables everything we do.

After the WillScot Mobile Mini merger, our combined board of directors created a roadmap to transition the company’s governance practices.

We modified our charter to establish an ESG initiative, and to provide oversight for that initiative.

Our audit committee and enterprise risk management committee each review the board of directors’ and the Company’s activities to assess risks and develop plans to mitigate those risks.

These committees consider a variety of potential risks that may affect the Company over the next three years, including climate change, truck fleet emissions, labor law changes, diversity, and zoning laws.

Intellectual Property

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On our Modular fleet, we maintain a patent for the design of our Flex units in the US and other patents in the US and non-US jurisdictions concerning various assembly and panel components.

We believe that Flex represents the most innovative and versatile purpose built modular space in the industry, which has helped us expand commercially into new end markets.

We believe that Flex represents innovative and versatile purpose built modular space solutions in the industry, which has helped us expand commercially into new end markets.

On our Storage fleet, we have patented our proprietary Tri‑Cam Locking System®, ContainerGuardLock® and other continued improvements in locking technology in the markets in which we operate, as well as in Europe and China.

We believe that continued innovation differentiates WillScot Mobile Mini with our customers and represents a source of long-term competitive advantage.

Recent Developments

Significant Developments

Mobile Mini Merger

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We believe that the Merger is resulting in strategic and financial benefits by combining the two industry leaders in the complementary modular space and portable storage solutions markets.

We are executing the integration of the two companies' operating and financial systems, with a significant portion of these efforts being focused currently on the conversion of the combined company onto a single enterprise resource planning system, which is expected to take place in the first half of 2021.

During the second quarter of 2021, we executed the successful integration of the two companies' enterprise resource planning ("ERP") operating and financial systems.

Reportable Segments

Following the Merger, we modified our management structure and expanded from two reporting segments to four reporting segments:

NA Modular, NA Storage, UK Storage, and Tank and Pump.

Prior to the Merger, WillScot had two reporting segments, US Modular and Other North America Modular.

These two segments were combined to create the new NA Modular segment, which represents the legacy WillScot operations.

The other new segments, NA Storage, UK Storage, and Tank and Pump align to the legacy operations and segments reported by Mobile Mini.

The new reporting segments are aligned with how we operate and analyze our business results.

We operate in four reportable segments as follows:

North America Modular Solutions ("NA Modular"), North America Storage Solutions ("NA Storage"), United Kingdom Storage Solutions ("UK Storage") and Tank and Pump Solutions ("Tank and Pump").

The reporting segments are aligned with how we operate and analyze our business results.

Prior to the third quarter of 2021, the NA Modular segment represented the activities of WillScot historical segments prior to the Merger, and the NA Storage, UK Storage and Tank and Pump segments represented the segments reported by Mobile Mini prior to the Merger.

During the third quarter of 2021, the majority of the portable storage product business within the NA Modular segment was transitioned to the NA Storage segment, and associated revenues, expenses, and operating metrics were transferred to the NA Storage segment beginning in the third quarter of 2021.

Asset Acquisitions

During the third and fourth quarters of 2021, we acquired the assets and liabilities of seven regional storage and modular companies, which consisted primarily of 15,700 storage units and 5,800 modular units for $ 147.2 million in cash.

We recorded rental equipment of $ 142.1 million as a result of these acquisitions.

Financing Activities

In anticipation of the Merger, on June 15, 2020, WillScot completed a private offering of $650.0 million in aggregate principal amount of 6.125% senior secured notes due 2025 (the “2025 Secured Notes”).

The offering proceeds from the 2025 Secured Notes of $650.0 million were used to repay the 7.875 % senior secured notes due 2022 (the “2022 Secured Notes”), repay Mobile Mini senior notes and pay certain fees and expenses related to the Merger and financing transactions.

On July 1, 2020, in connection with the completion of the Merger, we entered into a new asset-based credit agreement (the "2020 ABL Facility"), that provides for revolving credit facilities in the aggregate principal amount of up to $2.4 billion.

Proceeds from the 2020 ABL Facility of $1.5 billion were used to repay the WillScot 2017 ABL facility, the Mobile Mini line of credit, and fees and expenses related to the Merger and financing transactions.

The 2020 ABL Facility matures July 1, 2025.

On August 11, 2020, we redeemed $49.0 million of our 6.875% senior secured notes (the “2023 Secured Notes”) at a redemption price of 103.0% plus accrued and unpaid interest.

This repayment was funded by the 2020 ABL facility.

On August 25, 2020, we completed a private offering of $500.0 million in aggregate principal amount of 4.625% senior secured notes due 2028 (the “2028 Secured Notes”).

Proceeds from the 2028 Secured Notes were used to repay the $441.0 million remaining outstanding principal of the 2023 Secured Notes at a redemption price of 103.438% plus accrued and unpaid interest.

Sapphire Exchange

On June 30, 2020, as contemplated by the Merger Agreement, Sapphire Holding S.à r.l.

(“Sapphire Holdings”), our largest shareholder, which is controlled by TDR Capital LLP (“TDR Capital”), exchanged (the “Sapphire Exchange”) each of its shares of common stock of Williams Scotsman Holdings Corp.

("Holdings"), a wholly-owned subsidiary of the Company, pursuant to an existing exchange agreement between WillScot and Sapphire Holdings, for 1.3261 shares of newly issued WillScot Class A common stock, par value $0.0001 per share (the “Class A Common Stock”).

As a result of the Sapphire Exchange, all issued and outstanding shares of WillScot’s Class B common stock, par value $0.0001 per share, were automatically canceled for no consideration and the existing exchange agreement was automatically terminated.

As a result of the Sapphire Exchange, Sapphire Holdings received 10,641,182 shares of Class A Common Stock.

Share Conversion

In connection with the Merger, on July 1, 2020, WillScot issued 106,426,722 shares of its Class A Common Stock in exchange for the outstanding shares of common stock of Mobile Mini, par value $0.01 per share, and subsequently filed an amended and restated certificate of incorporation, which reclassified all outstanding shares of the Class A Common Stock and converted such shares into shares of Common Stock, par value of $0.0001 per share, of WillScot Mobile Mini.

On March 26, 2021, we redeemed $ 65.0 million of our 6.125% senior secured notes due 2025 (the "2025 Secured Notes") at a redemption price of 103.0%, plus accrued and unpaid interest.

This repayment was funded by internally generated cash flow and lower cost borrowings under the ABL Credit Agreement, dated July 1, 2020, by and among Williams Scotsman Holdings Corp.

(“Holdings”), Williams Scotsman International, Inc.

(“WSII”), the guarantors party thereto, the lenders party thereto, and Bank of America, N.A., as administrative agent and collateral agent (as amended from time to time, the “2020 ABL Facility”).

Upon redemption in the first quarter of 2021, we recorded a loss on extinguishment of debt in the consolidated statement of operations of $ 3.2 million comprised of a redemption premium of $ 1.9 million and write off of unamortized deferred financing fees of $ 1.3 million.

On June 16, 2021, we redeemed an additional $ 58.5 million of our 2025 Secured Notes at a redemption price of 103.0%, plus accrued and unpaid interest.

This repayment was funded by internally generated cash flow and lower cost borrowings under the 2020 ABL Facility.

Upon redemption in the second quarter of 2021, we recorded a loss on extinguishment of debt in the consolidated statement of operations of $ 2.8 million comprised of a redemption premium of $ 1.8 million and write off of unamortized deferred financing fees of $ 1.0 million.

Share and Warrant Repurchases

On March 1, 2021, in connection with an underwritten secondary offering of shares of our Common Stock offered by Sapphire Holding S.à r.l.

(“Sapphire Holdings”), our largest shareholder at that time and an entity controlled by TDR Capital

LLP (“TDR Capital”), we repurchased and cancelled 2,750,000 shares of our Common Stock directly from Sapphire Holdings for $73.7 million at a per share price equal to the per share price paid by the underwriters in the concurrent offering.

On June 29, 2021, in connection with a second underwritten secondary offering of shares of our Common Stock offered by Sapphire Holdings, we repurchased and cancelled an additional 3,900,000 shares of our Common Stock directly from Sapphire Holdings for $108.2 million at a per share price equal to the per share price paid by the underwriters in the concurrent offering.

On September 9, 2021, in connection with a third underwritten secondary offering of shares of our Common Stock offered by Sapphire Holdings, we repurchased and cancelled an additional 2,379,839 shares of our Common Stock directly from Sapphire Holdings for $67.1 million at a per share price equal to the per share price paid by the underwriters in the concurrent offering.

During the year ended December 31, 2021, we repurchased and cancelled 3,055,000 of the 2015 Private Warrants (as defined below) for $25.5 million.

In addition, during the year ended December 31, 2021, 9,655,000 of the 2015 Private Warrants were exercised on a cashless basis, resulting in the issuance of 2,939,898 shares of Common Stock.

As a result of these transactions, no 2015 Private Warrants were outstanding as of December 31, 2021.

During the year ended December 31, 2021, we repurchased and cancelled 254,373 of the 2018 Warrants for $ 2.9 million.

In addition, during the year ended December 31, 2021, 5,397,695 of the 2018 Warrants were exercised on a cashless basis, resulting in the issuance of 2,835,968 shares of Common Stock.

At December 31, 2021, 4,078,173 of the 2018 Warrants were outstanding.

During the year ended December 31, 2021, we repurchased and cancelled 12,878,490 shares of Common Stock and stock equivalents for $ 365.9 million, including the shares repurchased from Sapphire Holdings and all repurchased warrants.

In October 2021, our Board of Directors replaced the existing share repurchase program with a new share repurchase program that authorizes us to repurchase up to $ 1.0 billion of our outstanding shares of Common Stock and stock equivalents.

As of December 31, 2021, we had $ 956.7 million of the $1.0 billion share repurchase authorization remaining.

Given the predictability of our free cash flow, we believe that repurchases will be a reoccurring capital allocation priority.

Amendment to 2020 ABL Facility and Supplemental Indentures

In connection with an internal tax-related reorganization (the "Reorganization") involving indirect wholly-owned subsidiaries of the Company, on December 23, 2021, WSII merged with and into its direct wholly-owned subsidiary, Williams Scotsman, Inc., a Maryland corporation (“WSI”), with WSI as the surviving entity of such merger.

The purpose of the Reorganization was to simplify the Company's legal entity structure following numerous acquisitions and to reduce related franchise taxes and other administrative costs and had no impact on our underlying business operations.

In connection with the Reorganization, on December 23, 2021, WSI, the guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee and as collateral agent (in such capacities, the “Trustee”), entered into (i) a Supplemental Indenture (the “2025 Notes Supplemental Indenture”) in relation to that certain Indenture, dated as of June 15, 2020, (as amended, amended and restated, supplemented or otherwise modified from time to time, the “2025 Notes Indenture”), by and among WSII (as successor to Picasso Finance Sub, Inc.), as issuer, the guarantors from time to time party thereto and the Trustee in respect of WSII’s 6.125% Senior Secured Notes due 2025 and (ii) a Supplemental Indenture (the “2028 Notes Supplemental Indenture” and together with the 2025 Notes Supplemental Indenture, the “Supplemental Indentures”) in relation to that certain Indenture, dated as of August 25, 2020, (as amended, amended and restated, supplemented or otherwise modified from time to time, the “2028 Notes Indenture” and together with the 2025 Notes Indenture, the “Indentures”), by and among WSII (as successor to Picasso Finance Sub, Inc.), as issuer, the guarantors from time to time party thereto and the Trustee in respect of WSII’s 4.625% Senior Secured Notes due 2028, pursuant to which WSI assumed all of WSII’s obligations and rights under each Indenture, and the guarantors party to each Supplemental Indenture confirmed their respective guarantees under each Indenture.

Prior to its entry into the Supplemental Indentures, WSI was a guarantor under each Indenture and jointly and severally liable for WSII’s obligations under each Indenture.

Additionally, in connection with the Reorganization, on December 16, 2021, WSII and certain other subsidiaries of the Company entered into a third amendment (the “Third Amendment”) to the 2020 ABL Facility which, among other things, permits (i) the merger of WSII with and into WSI, and (ii) WSI to assume the duties and obligations of the Administrative Borrower (as defined in the 2020 ABL Facility) under the Loan Documents (as defined in the 2020 ABL Facility) in connection with the Reorganization.

Following the Reorganization and the entry into the Supplemental Indentures and the Third Amendment, there is no change to the consolidated operating cash flows of the obligors under the Indentures and the 2020 ABL Facility or the consolidated assets of such obligors pledged as collateral under the Indentures and the 2020 ABL Facility.

COVID-19 impact on business

Since the outbreak of COVID‑19 was designated as a global pandemic by the World Health Organization (the “WHO”) in March 2020, our operations have generally continued to operate normally, albeit at lower activity levels in the second and third quarters of 2020, and with additional safety protocols in place as we have been considered an essential business in most jurisdictions.

However, there have been significant changes to the global economic situation as a consequence of the COVID‑19 pandemic.

The global pandemic has resulted in significant global social and business disruption, and in response we have modified the way we communicate and conduct business with our customers, suppliers, and employees.

During the year ended December 31, 2020, financial results for our operations were impacted by the COVID‑19 pandemic as we experienced reduced demand, particularly in the second and third quarters of the year.

During this time, a portion of new project deliveries from our customers were either cancelled or delayed as a result of the COVID‑19 pandemic, and it remains unclear as to what extent such disruptions may impact our financial results in the future.

On a pro forma basis, our deliveries were down 25% in the second quarter year over year and 13% in the third quarter year over year due to reduced demand primarily attributable to the current global economic situation as a consequence of the COVID‑19 pandemic.

However, these impacts moderated in the fourth quarter and demand rebounded with deliveries up 2% year over year in the fourth quarter and up 0.3% sequentially from the third quarter to the fourth quarter of 2020.

Furthermore, reduced delivery activity was substantially offset by reduced lease terminations which were approximately 19% below 2019 levels in the second and third quarters which helped stabilize our units on rent.

Though recent demand has improved, the reduced delivery demand during the the second and third quarters of 2020 caused us to reduce variable costs and capital spending during those periods.

These actions contributed to expanded profitability and cash flow in these periods, and activity levels and costs began to normalize heading into the fourth quarter.

Despite this unprecedented demand shock, our long lease durations, our predictable cash inflows, and the fact that the majority of our gross profit in any given period is from units already out on rent, we believe we have visibility into our future cash flows and are able to plan ahead to adjust for varying demand levels.

The following summarizes many of the key actions we have taken in response to the COVID-19 pandemic:

Employee safety and health

We have implemented various employee safety measures to contain the spread of COVID‑19, including domestic and international travel restrictions, the promotion of social distancing and work‑from‑home practices, extensive cleaning protocols, daily symptom assessments, and enhanced use of personal protective equipment such as masks.

We continue to closely monitor all guidance provided by applicable government agencies to ensure the safety of our employees, vendors, and customers as our top priority.

Sales and leasing operations

We continue to monitor government restrictions, which vary significantly across our geographic markets.

As a result of the shelter‑in‑place orders and increased social distancing measures, some of our markets, such as special events and sports and entertainment, have experienced sustained reductions in demand for new projects.

Other sectors, such as health care, have experienced increased demand, while other sectors such as construction have remained active but with varying degrees of project disruption, some of which are quite significant.

We are also responding to demand across our end markets from customers in need of additional office space to facilitate social distancing.

As we serve many critical sectors of the economy, we will continue to help support customers who remain operational, as well as those who are actively engaged in the COVID-19 response.

We believe that our branch locations are considered essential businesses in most jurisdictions and as such have continued to operate normally with the aforementioned safety protocols in place, while our customer service and sales teams are working closely with customers to meet current demand.

Since the outbreak of COVID‑19 was designated as a global pandemic by the World Health Organization (the “WHO”) in March 2020, our operations have generally continued to operate normally with additional safety protocols in place as we have been considered an essential business in most jurisdictions.

The global macroeconomic backdrop and impact on our end markets has evolved rapidly since the beginning of 2020.

However, overall our lease portfolio and financial results have proven to be durable and consistent despite the severity of the economic contraction in 2020 and the current expansion in 2021.

Importantly, because of the long durations of our leases, the majority of our gross profit in any given period is from units already out on rent.

This gives us significant visibility into our future cash flows, which allows us to plan ahead and adjust

our capital expenditures and cost structure for varying demand levels.

Our portfolio of units already out on rent at the onset of the pandemic was resilient and largely not impacted, despite the unprecedented swings in economic activity in 2020.

Activity levels in the fourth quarter of 2020 and the first half of 2021 stabilized, and our volume of new lease activations grew significantly in the second quarter of 2021 as economic activity rebounded sharply with modular deliveries across our NA Modular and NA Storage segments up a combined 9% over pro forma 2020 levels and storage product deliveries across these two segments up a combined 39% over pro forma 2020 levels and on par with 2019 pro forma activity levels.

This recovery continued in the third quarter of 2021 and for the three months ended September 30, 2021, both modular and storage product deliveries across our NA Modular and NA Storage segments were up a combined 6% over 2020 levels.

Economic activity for the three months ended December 31, 2021 remained strong against a more stable fourth quarter of 2020 with storage product deliveries across our NA Modular and NA Storage segments up a combined 6% over 2020 levels and modular product deliveries essentially flat with 2020 levels.

Overall, while new lease activation volumes over the past eight quarters were impacted in line with the swings in economic activity, our lease revenue streams were stable and remain on an attractive upward long-term trajectory, a result of the diversification in our end markets, our long lease durations, and the success of the organic growth initiatives that we are executing.

Available Information

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We incur significant costs in our business to comply with these laws and regulations.

However, from time to time we may be subject to additional costs and

penalties as a result of non-compliance.

However, from time to time we may be subject to additional costs and penalties as a result of non-compliance.

The discovery of currently unknown matters or conditions, new laws and regulations, or different enforcement or interpretation of existing laws and regulations could materially harm our business or operations in the future.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business