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  "documentTitle": "Hannon Armstrong Sustainable Infrastructure Capital (HASI)",
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  "authorName": "Carson Block",
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  "notes": "This page functions as a forensic accounting narrative, detailing specific loan amounts, impairments, and the mechanics of HLBV income recognition.",
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      "text": "HASI books non-cash, unrealizable income when another financing partner in the deal, the Tax Equity Partner, realizes its investment tax credit (ITC).",
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      "text": "financing HASI has provided SunStrong – most of these were in the form of high-interest, “PIKable” mezzanine loans.",
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      "text": "In November 2018 – just three months after lending SunStrong money directly – HASI purchased 49% of SunStrong from SPWR for a mere $10 million, re-categorizing $179 million of its existing loans to SunPower from investment grade to non-investment grade before replacing $105 million of those loans with new ones.",
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      "text": "In 2018, SPWR created a wholly-owned subsidiary, SunStrong, and injected the leases into it. In Q3 2018, HASI loaned SunStrong another $110.5 million. With the addition of this mezzanine loan, HASI’s total loan balance to SPWR jumped from $310 million to approximately $418 million.",
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      "text": "Before HASI was a joint venture party in SunStrong, as of the end of 2017, it had loaned $306 million to SPWR. SPWR was struggling, and impaired the carrying value of its residential lease portfolio twice, first in 2017 by $624.3 million and again in 2018 by $189.7 million. SPWR had violated the leverage covenant in a HASI loan agreement from the previous year (2016). HASI removed that covenant in Q2 2017. SPWR sold off some of its troubled lease portfolio by mid-2018, and then HASI seemingly was in exclusive discussions with SPWR about buying the bulk of the remaining leases during the second half of 2018.",
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      "text": "HASI has since booked an estimated $15.3 million in non-cash Hypothetical Liquidation at Book Value (“HLBV”) income from SunStrong, despite SunStrong having lost $19.2 million during this time. HASI books non-cash, unrealizable income when another financing partner in the deal, the Tax Equity Partner, realizes its investment tax credit (ITC). HASI records this income regardless of how the project is performing; and, this income will be reversed over the life of the",
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      "text": "Footnotes 15-26 detailing specific SEC filings and financial disclosures.",
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      "kind": "title",
      "text": "HASI's $10 million Equity Investment Leads to ~$15.3 Million Non-Cash Income to HASI",
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