Debt and Financing Lease Liabilities |
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| Debt and Financing Lease Liabilities | DEBT AND FINANCING LEASE LIABILITIES
Our debt and financing lease liabilities comprised of the following:
Senior Secured Revolving Credit Facility
On June 22, 2021, we entered into the second amendment to the fourth amended and restated bank credit facility we have syndicated with three banks, which increased the amount of the revolving commitment by the lenders under the credit facility by $65,000 and included the following amendments:
•increased the aggregate amount of the revolving commitments from $115,000 to $180,000 through the existing June 28, 2024 maturity date,
•increased the total funded debt to EBITDA covenant ratio from a maximum of 3.25 to 3.50, and
•decreased the Eurocurrency rate floor from 1% to 0%.
We accounted for this amendment as a modification and at closing we incurred $78 in lender fees which were reflected as debt discount. The unamortized debt discount and issuance costs are being amortized over the remaining term of the amended agreement.
October 2020 Term Loan Modification
In October 2020, we entered into an amended and restated credit agreement with a bank primarily to increase the commitments under the existing credit agreement and add projects eligible for financing. The new credit agreement increased the commitment from $28,500 to $35,000 and included an option for the lender to increase the commitment by up to an additional $15,000 for a total not to exceed $50,000.
During the nine months ended September 30, 2021, the lender increased its commitment by the remaining $15,000 and we received net proceeds of $14,848. The quarterly payments consist of $1,250 in principal plus an additional principal prepayment based on project cash flows in addition to interest to be paid through the earlier of maturity, March 2026, or when the principal balance is paid in full. We accounted for this amendment as a modification and at closing we incurred $150 in lender fees which were reflected as debt discount and $2 in third-party fees which were expensed in selling, general and administrative expenses during the nine months ended September 30, 2021. The unamortized debt discount and issuance costs from the October 2020 loan modification are being amortized over the remaining term of the amended agreement. The balance of the loan outstanding as of September 30, 2021 was $42,833, net of unamortized debt discount and issuance costs.
Construction Revolvers
In June 2020, we entered into a revolving credit agreement with a bank, with an aggregate borrowing capacity of $100,000 for use in financing the construction cost of our owned projects. In March 2021, we entered into a third amendment to this agreement to
extend this facility from May 2021 to March 2022. All remaining unpaid amounts outstanding under the facility are due at that time.
During the nine months ended September 30, 2021, we closed on $14,013 in funding for four additional projects under this facility and drew down an additional $6,132 for existing projects. The balance of this construction revolver as of September 30, 2021 was $35,102, net of unamortized debt issuance costs and funds of $64,677 were available for borrowing under this facility.
We also have funds of $24,145 available for borrowing under our July 2020 construction revolver. In July 2021, two projects financed under this revolver failed to achieve commercial operations date (“COD”) on a timely basis; however, we received a limited waiver and an extension of COD for both projects from our lender, which cured the resulting event of default retroactively.
July 2021 Term Notes
On July 27, 2021, we entered into a $44,748 non-recourse debt agreement with a group of lenders. The financing facility consists of gross proceeds of $40,683 in senior secured first lien term notes due March 2046 (“Senior Notes”), gross proceeds of $4,065 in floating rate senior secured second lien term notes due March 2030 (“Second Lien Notes”), and a shelf facility of up to $60,000 available until July 2024. There were no notes issued under the shelf facility at September 30, 2021 and the lenders, in their sole discretion, have the right to approve or deny our funding requests.
The Senior Notes bear interest at a fixed rate of 3.25% per annum, are payable quarterly commencing September 30, 2021, and require that the project’s debt service coverage ratio for both the historical 12-month and projected 12-month periods at each payment date equal or exceed 1.2 to 1.0.
The Second Lien Notes bear a floating rate equal to the applicable LIBOR rate plus 3.50% from July 27, 2021 to July 26, 2025 and on July 27, 2025 the rate increases to the applicable LIBOR rate plus 3.75%. The Second Lien Notes are payable on each quarterly payment date commencing September 30, 2021, as specified in the debt agreement.
The agreement also requires us to maintain six months of scheduled payments of principal and interest as the minimum debt service reserve and to make additional principal prepayments based on project cash flows and certain other conditions through the earlier of maturity or when the principal balance is paid in full. At closing, we incurred $957 in lender fees and debt issuance costs. In connection with the Senior Notes, we recorded a derivative instrument for make-whole provisions with an initial value of $5,164, which is included in debt discount. See Note 11 for additional information. The aggregate balance of the Senior Notes and Second Lien Notes as of September 30, 2021 was $37,411, net of unamortized debt discount and issuance costs.
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