Long-term Debt (Tables)
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9 Months Ended |
Sep. 30, 2017 |
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| Schedule of Outstanding Non-Recourse Asset-Backed Debt and Bank Loans |
We have outstanding the following
asset-backed non-recourse debt
and bank loans (dollars in millions):
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Outstanding Balance
as of |
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Value of
Assets Pledged
as of |
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September 30,
2017 |
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December 31,
2016 |
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Interest
Rate |
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Maturity Date |
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Anticipated
Balance at
Maturity |
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September 30,
2017 |
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December 31,
2016 |
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Description of Assets Pledged
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HASI Sustainable Yield Bond 2013-1
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$ |
68 |
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$ |
75 |
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2.79 |
% |
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December 2019 |
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$ |
57 |
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$ |
87 |
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$ |
93 |
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Financing receivables |
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ABS Loan Agreement
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$ |
79 |
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$ |
90 |
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5.74 |
% |
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September 2021 |
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$ |
17 |
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$ |
80 |
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$ |
97 |
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Equity interest in Strong Upwind Holdings I,
LLC |
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HASI Sustainable Yield Bond 2015-1A
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$ |
95 |
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$ |
97 |
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4.28 |
% |
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October 2034 |
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$ |
— |
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$ |
137 |
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$ |
138 |
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Financing receivables, real estate and real
estate intangibles |
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HASI Sustainable Yield Bond 2015-1B Note
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$ |
14 |
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$ |
— |
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5.41 |
% |
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October 2034 |
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$ |
— |
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$ |
137 |
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$ |
— |
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Class B Bond of HASI Sustainable Yield
Bond 2015-1
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HASI SYB Loan Agreement 2015-1
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$ |
— |
(1) |
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$ |
74 |
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$ |
— |
(1) |
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(1)
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$ |
— |
(1) |
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$ |
— |
(1) |
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$ |
96 |
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Equity interest in Strong Upwind Holdings II
and III, LLC, related interest rate swap |
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2017 Credit Agreement
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$ |
198 |
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$ |
— |
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3.55 |
% (2) |
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June 2024 |
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$ |
— |
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$ |
243 |
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$ |
— |
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Equity interests in Strong Upwind Holdings I,
II, III, and IV LLC, and Northern Frontier, LLC |
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HASI SYB Loan Agreement 2015-2
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$ |
37 |
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$ |
41 |
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5.41 |
% (3) |
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December 2023 |
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$ |
— |
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$ |
67 |
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$ |
70 |
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Equity interest in Buckeye Wind Energy
Class B Holdings LLC, related interest rate swap |
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HASI SYB Loan Agreement 2015-3
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$ |
146 |
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$ |
150 |
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4.92 |
% |
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December 2020 |
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$ |
127 |
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$ |
172 |
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$ |
175 |
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Residential solar financing receivables,
related interest rate swaps |
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HASI SYB Loan Agreement 2016-1
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$ |
118 |
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$ |
98 |
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4.37 |
% (3) |
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November 2021 |
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$ |
101 |
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$ |
138 |
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$ |
114 |
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Residential solar financing receivables,
related interest rate swaps |
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HASI SYB Trust 2016-2
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$ |
86 |
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$ |
— |
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4.35 |
% |
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April 2037 |
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$ |
— |
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$ |
88 |
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$ |
— |
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Financing receivables |
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2017 Master Repurchase Agreement
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$ |
37 |
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$ |
— |
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3.96 |
% (3) |
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July 2019 |
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$ |
31 |
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$ |
41 |
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$ |
— |
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Financing receivables and investments |
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HASI ECON 101 Trust
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$ |
134 |
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$ |
— |
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3.57 |
% |
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May 2041 |
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$ |
— |
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$ |
139 |
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$ |
— |
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Financing receivables and investments |
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Other non-recourse debt (4)
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$ |
85 |
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$ |
84 |
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2.26% -
7.45 |
% |
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2017 to 2046 |
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$ |
— |
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$ |
224 |
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$ |
81 |
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Financing receivables |
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Debt issuance costs (5)
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$ |
(21 |
) |
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$ |
(17 |
) |
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Non-recourse debt (6)
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$ |
1,076 |
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$ |
692 |
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| (1) |
This non-recourse debt
agreement was re-financed in the
second quarter of 2017 with the same lender through the 2017 Credit
Agreement. |
| (2) |
Interest rate represents the current
period’s LIBOR based rate plus the spread. Under the terms of
the 2017 Credit Agreement, this rate will become fixed upon the
lender’s syndication of the loan, or the rate can be fixed at
our option. |
| (3) |
Interest rate represents the current
period’s LIBOR based rate plus the spread. Also see the
interest rate swap contracts shown in the table below, the value of
which are not included in the book value of assets pledged or the
interest rate of the debt instrument. |
| (4) |
Other non-recourse debt
consists of various debt agreements used to finance certain of our
financing receivables for their term. Debt service payment
requirements, in a majority of cases, are equal to or less than the
cash flows received from the underlying financing receivables. |
| (5) |
Excludes costs of approximately
$2 million associated with the 2017 Master Repurchase
Agreement that were recorded in other assets due to the nature of
the costs. |
| (6) |
The total collateral pledged against
our non-recourse debt
was $1,416 million and $864 million as of
September 30, 2017 and December 31, 2016,
respectively. |
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| Schedule of Interest Rate Swaps which are Designated as Cash Flow Hedges |
In connection with several of our non-recourse debt borrowings, we have
entered into the following interest rate swaps that are designated
as cash flow hedges (dollars in millions):
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Notional Value as of |
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Fair Value as of |
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Base
Rate
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Hedged
Rate |
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September 30,
2017 |
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December 31,
2016 |
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September 30,
2017 |
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December 31,
2016 |
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Term
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HASI SYB Loan Agreement 2015-1 (1)
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3 month
Libor
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1.55 |
% |
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$ |
— |
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$ |
67 |
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$ |
— |
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$ |
— |
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December 2015 to
September 2021 |
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HASI SYB Loan Agreement 2015-2
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3 month
Libor
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1.52 |
% |
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$ |
36 |
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$ |
37 |
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$ |
— |
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$ |
— |
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December 2015 to December 2018 |
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HASI SYB Loan Agreement 2015-2
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3 month
Libor
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2.55 |
% |
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$ |
29 |
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$ |
29 |
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$ |
(0.3 |
) |
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$ |
(0.2 |
) |
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December 2018 to December 2024 |
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HASI SYB Loan Agreement 2015-3
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1 month
Libor
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2.34 |
% |
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$ |
119 |
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$ |
119 |
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$ |
(0.1 |
) |
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$ |
1.0 |
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November 2020 to August 2028 |
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HASI SYB Loan Agreement 2016-1
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3 month
Libor
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1.88 |
% |
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$ |
119 |
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$ |
72 |
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$ |
0.1 |
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$ |
0.2 |
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November 2016
to November 2021
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HASI SYB Loan Agreement 2016-1
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3 month
Libor
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2.73 |
% |
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$ |
107 |
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$ |
107 |
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$ |
(1.0 |
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$ |
— |
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November 2021 to October 2032 |
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Total
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$ |
410 |
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$ |
431 |
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$ |
(1.3 |
) |
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$ |
1.0 |
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| (1) |
This interest rate swap was
financially settled in June 2017. |
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| Summary of Analysis of Financial Statement Line Item Impacted by Cash Flow Hedges in Condensed Consolidated Statement of Operations |
The following is an analysis of the financial statement line item
impacted by our cash flow hedges in our condensed consolidated
statement of operations:
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Three months ended
September 30, |
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Nine months ended
September 30, |
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(dollars in
thousands) |
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2017 |
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2016 |
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2017 |
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2016 |
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Total interest expense
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$ |
17,584 |
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$ |
10,635 |
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$ |
46,728 |
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$ |
32,945 |
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Impact of hedging
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$ |
201 |
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$ |
253 |
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$ |
798 |
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$ |
1,042 |
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| Schedule of Minimum Maturities of Non-Recourse Debt |
Our future stated minimum maturities of non-recourse debt are as follows:
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(dollars in millions)
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October 1, 2017 to December 31, 2017
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$ |
24 |
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2018
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51 |
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2019
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|
142 |
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2020
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|
178 |
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2021
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|
146 |
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2022
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21 |
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Thereafter
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|
535 |
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$ |
1,097 |
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Deferred financing costs, net
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(21 |
) |
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Total non-recourse
debt
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$ |
1,076 |
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| 4.125% Convertible Senior Notes Due September 1, 2022 [Member] |
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| Summary of Components of Convertible Notes |
The following table presents a summary of the components of the
Convertible Notes (dollars in millions):
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September 30,
2017 |
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Principal
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$ |
150 |
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Accrued interest
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1 |
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Less:
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Unamortized financing costs
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(5 |
) |
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Carrying value of Convertible Notes
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$ |
146 |
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