HA Sustainable Infrastructure Capital Inc. filed SEC Form 8-K: Creation of a Direct Financial Obligation, Entry into a Material Definitive Agreement
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| Item 1.01. | Entry into a Material Definitive Agreement. |
Indenture and 7.125% Green Junior Subordinated Notes due 2056
On February 27, 2026, HA Sustainable Infrastructure Capital, Inc., a Delaware corporation (the “Company”), issued $600,000,000 aggregate principal amount of its 7.125% Green Junior Subordinated Notes due 2056 (the “Notes”), under an indenture, dated as of June 24, 2025 (the “Base Indenture”), between the Company, Hannon Armstrong Sustainable Infrastructure, L.P., a Delaware limited partnership (the “Operating Partnership”), Hannon Armstrong Capital, LLC, a Maryland limited liability company (“HAC”), HAT Holdings I LLC, a Maryland limited liability company (“HAT I”), HAT Holdings II LLC, a Maryland limited liability company (“HAT II”), HAC Holdings I LLC, a Delaware limited liability company (“HAC Holdings I”) and HAC Holdings II LLC, a Delaware limited liability company (“HAC Holdings II,” and collectively with the Operating Partnership, HAC, HAT I, HAT II and HAC Holdings I, the “Guarantors”), as guarantors, and U.S. Bank Trust Company, National Association, as trustee, as amended and supplemented pursuant to an Officer’s Certificate, dated February 27, 2026 (the “Officer’s Certificate” and, together with the Base Indenture, the “Indenture”).
The Company intends to use the net proceeds from the offering to (i) temporarily repay a portion of the outstanding borrowings under the Company’s unsecured revolving credit facility, (ii) temporarily repay a portion of the outstanding borrowings under the Company’s commercial paper programs or (iii) redeem all or a lesser amount of the outstanding principal amount of the Company’s 8.00% Senior Notes due 2027. The Company will use cash equal to the net proceeds from the offering of the Notes to acquire, invest in or refinance, in whole or in part, new and/or existing eligible green projects. These eligible green projects may include projects with disbursements made during the twelve months preceding the issue date of the offering of the Notes and projects with disbursements to be made within two years following the issue date. Prior to the full investment of an amount equal to such net proceeds in such eligible green projects, the Company intends to apply the net proceeds as set forth above and to invest any remaining net proceeds in interest-bearing accounts and short-term, interest-bearing securities.
The Notes bear interest (i) from and including February 27, 2026 to, but excluding, November 15, 2031 (the “First Reset Date”) at the rate of 7.125% per year and (ii) from and including the First Reset Date, during each Reset Period (as defined in the Indenture), at a rate per year equal to the Five-year U.S. Treasury Rate (as defined in the Indenture) as of the most recent Reset Interest Determination Date (as defined in the Indenture) plus a spread of 3.478%, to be reset on each Reset Date (as defined in the Indenture); provided, that the interest rate during any Reset Period will not reset below 7.125%. Subject to the Company’s right to defer interest payments as described in the Indenture, interest on the Notes will be paid semi-annually in arrears on each May 15 and November 15, commencing May 15, 2026.
Any deferred interest on the Notes will accrue additional interest at a rate equal to the interest rate then applicable to the Notes to the extent permitted by applicable law. Once the Company pays all deferred interest payments on the Notes, including any additional interest accrued on the deferred interest, the Company can again defer interest payments on the Notes as described above, but not beyond the maturity date of the Notes.
The following is a brief description of the terms of the Notes and the Indenture.
Change of Control
If a Change of Control Event (as defined in the Indenture) occurs and is continuing, the Company may redeem the Notes, in whole but not in part, at its option at a redemption price equal to 101% of the principal amount plus any accrued and unpaid interest thereon to, but excluding the date of redemption.
Optional Redemption
The Company may redeem the Notes in whole or in part on one or more occasions at a price equal to 100% of the principal amount being redeemed, plus accrued and unpaid interest to, but excluding, the redemption date (i) on any day in the period commencing on the date falling 90 days prior to the First Reset Date and ending on and including the First Reset Date and (ii) after the First Reset Date, on any interest payment date.
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The Notes are redeemable, in whole, but not in part, at 100% of the principal amount of the Notes, plus accrued and unpaid interest to, but excluding, the redemption date, at any time following the occurrence and during the continuance of a Tax Event (as defined in the Indenture).
The Notes are redeemable in whole, but not in part, at 102% of the principal amount of the Notes, plus accrued and unpaid interest to, but excluding, the redemption date, at any time following the occurrence and during the continuance of a Rating Agency Event (as defined in the Indenture) with respect to the Notes.
Guarantees
When the Notes are first issued they will be guaranteed solely by the Guarantors. None of the Company’s other current or future subsidiaries will be required to guarantee the Notes in the future.
Ranking
The Notes will:
| • | be subordinate and junior in right of payment to all existing and future senior indebtedness, guarantees and other liabilities of the Company; |
| • | be effectively junior to the Company’s secured debt, to the extent of the value of the collateral securing such secured debt; |
| • | be effectively junior to all debt and other liabilities of the Company’s subsidiaries from time to time outstanding (other than any pari passu debt and other liabilities of the Guarantors); |
| • | be pari passu with all existing and future subordinated indebtedness, guarantees and other liabilities of the Company that is not specifically stated to be junior to the Notes; and |
| • | rank senior to all of the equity securities of the Company. |
The guarantee from each Guarantor will:
| • | be subordinate and junior in right of payment to all existing and future senior indebtedness, guarantees and other liabilities; |
| • | be effectively junior to the Guarantors’ secured debt, to the extent of the value of the collateral securing such secured debt; |
| • | be effectively junior to all debt and other liabilities of the Guarantors’ subsidiaries (other than any pari passu debt and other liabilities of subsidiaries that are Guarantors of the Notes) from time to time outstanding; |
| • | be pari passu with all other existing and future subordinated indebtedness, guarantees and other liabilities of the Guarantors that is not specifically stated to be junior to the Guarantee; and |
| • | rank senior to all of the equity securities of the Guarantors. |
The Guarantors’ guarantees of the Notes and all other obligations of such Guarantor under the Indenture will automatically terminate and such Guarantor will automatically be released from all of its obligations under such guarantee and the Indenture under certain circumstances set forth in the Indenture, including if such Guarantor ceases or substantially contemporaneously ceases to (i) guarantee any Corporate Indebtedness (as defined in the Indenture) (other than the Notes) and (ii) have any outstanding Corporate Indebtedness issued by such Guarantor.
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Covenants
The Indenture contains covenants that, subject to a number of exceptions and adjustments, among other things, impose certain requirements in order for the Company to merge or consolidate with or transfer all or substantially all of our assets to another person.
Events of Default
The Indenture also provides for Events of Default (as defined in the Indenture) which, if any of them occurs, would permit or require the principal of and accrued and unpaid interest on all the outstanding Notes to become or to be declared due and payable.
The preceding description is qualified in its entirety by reference to the Base Indenture and Officer’s Certificate, copies of which are attached as Exhibits 4.1 and 4.2 to this Current Report on Form 8-K and are 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 required by this Item 2.03 relating to the Notes and the Indenture is contained in Item 1.01 above and is incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| HA SUSTAINABLE INFRASTRUCTURE CAPITAL, INC. | ||||||
| Dated: February 27, 2026 |
By: |
/s/ Steven L. Chuslo | ||||
| Steven L. Chuslo | ||||||
| Executive Vice President and Chief Legal Officer | ||||||
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