Quarterly report pursuant to Section 13 or 15(d)

Long-term Debt (Tables)

v3.23.3
Long-term Debt (Tables)
 9 Months Ended
Sep. 30, 2023
Debt Disclosure [Abstract]  
Schedule of Outstanding Non-Recourse Asset-Backed Debt
We have outstanding the following asset-backed non-recourse debt:

  Outstanding Balance
as of		 Anticipated
Balance at
Maturity		 Carrying Value of Assets Pledged as of
  September 30, 2023 December 31, 2022 Interest
Rate		 Maturity Date September 30, 2023 December 31, 2022 Description
of Assets Pledged
(dollars in millions)
HASI Sustainable Yield Bond 2015-1A $ 70  $ 73  4.28% October 2034 $ —  $ 137  $ 136  Receivables, real estate, real estate intangibles, and restricted cash
HASI SYB Trust 2016-2 55  56  4.35% April 2037 —  62  63  Receivables and restricted cash
HASI SYB Trust 2017-1 — 
(1)
 141  3.86% March 2042 —  —  231  Receivables, real estate, real estate intangibles, and restricted cash
Lannie Mae Series 2019-1 — 
(1)
 90  3.68% January 2047 —  —  120  Receivables, real estate and real estate intangibles
Other non-recourse
debt (2)
45  82 
3.15% - 7.23%
 2024 to 2032 18  46  82  Receivables
Unamortized financing costs (2) (9)
Non-recourse debt (3)
$ 168  $ 433 
(1)In the third quarter of 2023, contractual terms of these non-recourse debt agreements were modified, which caused us to deconsolidate the entities holding such debt and its related pledged collateral.
(2)Other non-recourse debt consists of various debt agreements used to finance certain of our receivables. Scheduled debt service payment requirements are equal to or less than the cash flows received from the underlying receivables.
(3)The total collateral pledged against our non-recourse debt was $245 million and $632 million as of September 30, 2023 and December 31, 2022, respectively. These amounts include $14 million and $20 million of restricted cash pledged for debt service payments as of September 30, 2023 and December 31, 2022, respectively.
Schedule of Minimum Maturities of Debt
The stated minimum maturities of non-recourse debt as of September 30, 2023, were as follows:

Future minimum maturities
(in millions)
October 1, 2023 to December 31, 2023 $ 10 
2024 18 
2025 15 
2026 14 
2027 21 
2028 18 
Thereafter 74 
Total minimum maturities $ 170 
Unamortized financing costs (2)
Total non-recourse debt $ 168 
Principal payments which were due under the term loan facility as of September 30, 2023 are as follows:
Future maturities
(in millions)
October 1, 2023 to December 31, 2023 $ 5 
2024 18 
2025 350 
Total 373 
Less: Unamortized Financing Costs (3)
Carrying Value $ 370 
Principal payments which were due under the Secured Term Loan Facility as of September 30, 2023 are as follows:
Future maturities
(in millions)
July 1, 2023 to December 31, 2023 $ — 
2024 2 
2025 11 
2026 13 
2027 12 
2028 162 
Total 200 
Less: Unamortized Financing Costs (3)
Carrying Value $ 197 
Schedule of Long-term Debt Instruments
The following are summarized terms of the Senior Unsecured Notes:
Outstanding Principal Amount Maturity Date Stated Interest Rate Interest Payment Dates Redemption Terms Modification Date
(in millions)
2025 Notes $ 400  April 15, 2025 6.00  % April 15 and
October 15th		 N/A
2026 Notes 1,000  June 15, 2026 3.38  % June 15 and December 15
March 15, 2026 (1)
2030 Notes 375 
(2)
 September 15, 2030 3.75  % February 15th and August 15th N/A

(1)Prior to this date, we may redeem, at our option, some or all of the 2026 Notes for the outstanding principal amount plus the applicable “make-whole” premium as defined in the indenture governing the 2026 Notes plus accrued and unpaid interest through the redemption date. In addition, prior to this date, we may redeem up to 40% of the Senior Unsecured Notes using the proceeds of certain equity offerings at a price equal to par plus the coupon percentage of the principal amount thereof, plus accrued but unpaid interest, if any, to, but excluding, the applicable redemption date. On, or subsequent to, this date we may redeem the 2026 Notes in whole or in part at redemption prices defined in the indenture governing the 2026 Notes, plus accrued and unpaid interest though the redemption date.
(2)We issued the $375 million aggregate principal amount of the 2030 Notes for total proceeds of $371 million ($367 million net of issuance costs) at an effective interest rate of 3.87%.
We may redeem the 2025 Notes in whole or in part at redemption prices defined in the indenture governing the 2025 Notes plus accrued and unpaid interest though the redemption date. At any point prior to maturity, we may redeem, at our option, some or all of the 2030 Notes plus the applicable “make-whole” premium as defined in the indenture governing the 2030 Notes plus accrued and unpaid interest through the redemption date.
The following table presents a summary of the components of the Senior Unsecured Notes:
  September 30, 2023 December 31, 2022
(in millions)
Principal $ 1,775  $ 1,775 
Accrued interest 23  12 
Unamortized premium (discount) (3) (3)
Less: Unamortized financing costs (13) (16)
Carrying value of Senior Unsecured Notes $ 1,782  $ 1,768 
The following are summarized terms of the Convertible Notes as of September 30, 2023:
Outstanding Principal Amount Maturity Date Stated Interest Rate Interest Payment Dates Conversion/Exchange Ratio Conversion/Exchange Price Issuable Shares
Dividend Threshold Amount (1)
(in millions) (in millions)
2023 Convertible Senior Notes — 
(2)
 August 15,
2023		 0.000  % N/A 20.8643 $47.93 — $0.340
2025 Exchangeable Senior Notes 200 
(3)
 May 1,
2025		 0.000  % N/A 17.7144 $56.45 3.5 $0.375
2028 Exchangeable Senior Notes 403  August 15,
2028		 3.750  % February 15 and August 15 36.8494 $27.14 14.8 $0.395
(1)The conversion or exchange ratio is subject to adjustment for dividends declared above these amounts per share per quarter and certain other events that may be dilutive to the holder.
(2)These Notes were settled in the third quarter of 2023 using proceeds from the 2028 Exchangeable Senior Notes.
(3)The 2025 Exchangeable Senior Notes accrete to a premium at maturity equal to 3.25% per annum. The current balance including accreted premium is $210 million.
Schedule of Components of Convertible Notes
The following table presents a summary of the components of our Convertible Notes:

  September 30, 2023 December 31, 2022
(in millions)
Principal $ 603  $ 344 
Accrued interest 2  — 
Premium 10  5 
Less: Unamortized financing costs (11) (5)
Carrying value of Convertible Notes
 $ 604  $ 344 
Schedule Of Material Terms For Capped Calls The material terms of the Capped Calls are as follows:
(in millions except per share data)
Aggregate cost of capped calls $ 38 
Initial strike price per share $ 27.14 
Initial cap price per share $ 43.42 
Shares of our common stock covered by the capped calls 14.8
Schedule of Interest Rate Swaps
In connection with several of our long-term borrowings, including floating-rate loans from our Term Loan Facility and unsecured revolving credit facility and the anticipated refinancings of certain of our Senior Unsecured Notes we have entered into the following derivative transactions that are designated as cash flow hedges as of September 30, 2023:
Instrument type Hedged Rate Notional Value Fair Value as of
Index September 30, 2023 Term
$ in millions
Interest rate swap 1 month SOFR 3.79  % $ 400  $ 12  March 2023 to March 2033
Interest rate swap Overnight SOFR 2.98  % 400  23  June 2026 to June 2033
Interest rate swap Overnight SOFR 3.09  % 600  30  June 2026 to June 2033
Interest rate swap Overnight SOFR 3.08  % 400  30  April 2025 to April 2035
Interest rate collar 1 month SOFR
3.70% - 4.00%
(1)
 250  5  May 2023 to May 2026
$ 2,050  $ 100 
(1)     Interest rate collar consists of a purchased interest rate cap of 4.00% and a written interest rate floor of 3.70%.