HA Sustainable Infrastructure Capital, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Equity

Equity

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Equity

Dividends and Distributions

Our board of directors declared the following dividends in 2018 and 2019:



Announced Date	Record Date		Pay Date	Amount per share
2/21/2018	4/4/2018		4/12/2018	$	0.330
5/31/2018	7/5/2018		7/12/2018	0.330
9/12/2018	10/3/2018		10/11/2018	0.330
12/12/2018	12/26/2018	⁽¹⁾	1/10/2019	0.330
2/21/2019	4/3/2019		4/11/2019	0.335
6/6/2019	7/5/2019		7/12/2019	0.335
9/12/2019	10/3/2019		10/10/2019	0.335
12/13/2019	12/26/2019	⁽¹⁾	1/10/2020	0.335


(1)	These dividends are treated as distributions in the following year for tax purposes.

Equity Offerings

We have an effective universal shelf registration statement registering the potential offer and sale, from time to time and in one or more offerings, of any combination of our common stock, preferred stock, depositary shares, debt securities, warrants and rights (collectively referred to as the “securities”). We may offer the securities directly, through agents, or to or through underwriters by means of ordinary brokers’ transactions on the NYSE or otherwise at market prices prevailing at the time of sale or at negotiated prices and may include “at the market” (“ATM”) offerings or sales, to or through a market maker or into an existing trading market on an exchange or otherwise. We completed the following public offerings (including ATM issuances) of our common stock in 2018 and 2019:



Closing Date	Common Stock Offerings	Shares Issued ⁽¹⁾	Price Per Share		Net Proceeds ⁽²⁾
		(amounts in millions, except per share amounts)
5/18/2018 to 6/25/2018	ATM	0.834	18.76	⁽³⁾	15
11/15/2018 to 12/11/2018	ATM	2.777	23.37	⁽³⁾	64
12/17/2018 and 1/3/2019	Public Offering	5.465	21.60	⁽⁴⁾	117
1/23/2019 to 3/21/2019	ATM	1.603	23.39	⁽³⁾	37
5/7/2019 to 6/7/2019	ATM	1.926	26.33	⁽³⁾	50
12/12/2019	ATM	1.405	30.00	⁽³⁾	42


(1)	Includes shares issued in connection with the exercise of the underwriters’ option to purchase additional shares.


(2)	Net proceeds from the offerings are shown after deducting underwriting discounts, commissions and other offering costs.


(3)	Represents the average price per share at which investors in our ATM offerings purchased our shares.


(4)	Represents the price per share at which the underwriters in our public offerings purchased our shares.

Equity-based Compensation Awards under our 2013 Plan

We have 5,559,819 awards authorized for issuance under our 2013 Plan. As of December 31, 2019, we have issued awards with service, performance and market conditions and have 1,990,996 awards remaining available for issuance. During the year ended December 31, 2019, our board of directors awarded employees and directors 586,909 shares of restricted stock, restricted stock units, and LTIP Units that vest from 2020 to 2023. As of December 31, 2019, as it relates to previously issued restricted stock awards with performance conditions, we have concluded that it is probable that the performance conditions will be met. Refer to Note 4 for background on the LTIP Units.

A summary of equity-based compensation expense and the fair value of shares vested on the vesting date for the years ended December 31, 2019, 2018, and 2017 is as follows:



	2019		2018		2017
	(in millions)
Equity-based compensation expense	$	14	$	10	$	11
Fair value of awards vested on vesting date	19		7		5

The total unrecognized compensation expense related to awards of shares of restricted stock and restricted stock units was approximately $14 million as of December 31, 2019. We expect to recognize compensation expense related to these awards over a weighted-average term of approximately two years. A summary of the unvested shares of restricted common stock that have been issued is as follows:



	Restricted Shares of Common Stock		Weighted Average Grant Date Fair Value		Value
			(per share)		(in millions)
Ending Balance—December 31, 2017	1,399,593		$	18.73	$	26.2
Granted	454,106		19.72		9.0
Vested	(370,072	)	18.88		(7.0		)
Forfeited	(96,871	)	18.92		(1.8		)
Ending Balance—December 31, 2018	1,386,756		$	19.00	$	26.4
Granted	150,493		23.99		3.6
Vested	(781,218	)	18.91		(14.8		)
Forfeited	(5,789	)	20.62		(0.1		)
Ending Balance—December 31, 2019	750,242		20.08		15.1

A summary of the unvested shares of restricted stock units that have market based vesting conditions that have been issued is as follows:



	Restricted Stock Units ⁽¹⁾		Weighted Average Grant Date Fair Value		Value
			(per share)		(in millions)
Ending Balance—December 31, 2017	255,706		$	18.99	$	4.9
Granted	176,128		20.24		3.5
Vested	(20,368	)	18.99		(0.4		)
Forfeited	(18,318	)	19.05		(0.3		)
Ending Balance—December 31, 2018	393,148		$	19.55	$	7.7
Granted	46,586		25.10		1.2
Vested	(1,380	)	21.68		—
Forfeited	(2,776	)	22.23		(0.1		)
Ending Balance—December 31, 2019	435,578		$	20.12	$	8.8


(1)	As discussed in Note 2, restricted stock units with market-based vesting conditions can vest between 0% and 200% subject to both the absolute performance of the Company’s common stock as well as relative performance compared to a group of peers.

A summary of the unvested LTIP Units that have time-based vesting conditions that have been issued is as follows:



	LTIP Units ⁽¹⁾		Weighted Average Grant Date Fair Value		Value
			(per share)		(in millions)
Ending Balance—December 31, 2018	—		$	—	$	—
Granted	209,330		25.84		5.4
Vested	(8,020	)	25.82		(0.2		)
Forfeited	—		—		—
Ending Balance—December 31, 2019	201,310		$	25.84	$	5.2

(1) See Note 4 for information on the vesting of LTIP Units.

A summary of the unvested LTIP Units that have market-based vesting conditions that have been issued is as follows:



	LTIP Units ⁽¹⁾	Weighted Average Grant Date Fair Value		Value
		(per share)		(in millions)
Ending Balance—December 31, 2018	—	$	—	$	—
Granted	180,500	26.70		4.8
Vested	—	—		—
Forfeited	—	—		—
Ending Balance—December 31, 2019	180,500	$	26.70	$	4.8

(1) See Note 4 for information on the vesting of LTIP Units. LTIP Units with market-based vesting conditions can vest between 0% and 200% subject to both the absolute performance of the Company’s common stock as well as relative performance compared to a group of peers.