Item 1.01
Entry Into a Material Definitive Agreement
On April 19, 2021, Hannon Armstrong Sustainable Infrastructure Capital, Inc. (the “Company”) through its indirect subsidiaries as borrowers entered into a new $400 million, 364-day unsecured revolving credit facility pursuant to a revolving credit agreement (the “Credit Agreement”) with JPMorgan Chase Bank, N.A. (“JPMorgan”) as administrative agent, sole bookrunner, sole lead arranger and sustainability structuring agent, Bank of America, N.A., Barclays Bank PLC, Credit Suisse AG, New York Branch, KeyBank National Association, Morgan Stanley Senior Funding, Inc., Royal Bank of Canada, Sumitomo Mitsui Banking Corporation and Wells Fargo Bank, National Association, as documentation agents and the lenders as defined in the Credit Agreement. The obligations of the borrowers under the Credit Agreement are guaranteed by the Company and certain of its subsidiaries. The Credit Agreement replaces the Company’s existing $50 million unsecured credit facility entered into in February 2021.
The Credit Agreement has a commitment fee based on the Company’s current credit rating and bears interest at a rate of the LIBOR or prime rate plus applicable margins based on the Company’s current credit rating, which may be adjusted downward up to 0.05% to the extent our Portfolio achieves certain targeted levels of carbon emissions reductions. As of the date of the Credit Agreement, the applicable margins are 2.25% for LIBOR-based loans and 1.25% for prime rate-based loans.
The Credit Agreement contains terms, conditions, covenants, and representations and warranties that are customary and typical for a transaction of this nature, including various affirmative and negative covenants, and limitations on the incurrence of liens and indebtedness, investments, fundamental organizational changes, dispositions, changes in the nature of business, transactions with affiliates, use of proceeds, stock repurchases, and dividends the Company declares. The Credit Agreement also includes customary events of default and remedies. At the Company’s option, upon scheduled maturity of the facility, the Company has the ability to convert amounts borrowed into term loans for a fee equal to 2.25% of the term loans.
A copy of the Credit Agreement is filed as Exhibit 1.1 to this Current Report on Form 8-K, and the descriptions of the material terms of the Credit Agreement in this Item 1.01 are qualified in their entirety by reference to such Exhibit, which is incorporated herein by reference.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant |
The information set forth above under “Item 1.01. Entry into a Material Definitive Agreement” is incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits
| | |
| Exhibit No. | | Description |
| |
| 1.1 | | Credit Agreement, dated as of April 19, 2021, by and among the Company, certain subsidiaries of the Company, JPMorgan Chase Bank, N.A. as administrative agent, sole bookrunner, sole lead arranger and sustainability structuring agent, Bank of America, N.A., Barclays Bank PLC, Credit Suisse AG, New York Branch, KeyBank National Association, Morgan Stanley Senior Funding, Inc., Royal Bank of Canada, Sumitomo Mitsui Banking Corporation and Wells Fargo Bank, National Association, as documentation agents, and each lender from time to time party thereto |
| |
| 104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
- 2 -
