{
  "docId": "019dd923-622c-750b-8b97-386a39fe2e3c",
  "docSlug": "5f1b43d262e5",
  "documentTitle": "Hannon Armstrong Sustainable Infrastructure Capital (HASI)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson Block",
  "documentKindSlug": "research-note",
  "documentKindLabel": "Research note",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2022-07-12 00:00:00",
  "orientation": "portrait",
  "aspectRatio": 0.77272725,
  "pageNumber": 8,
  "pageCount": 27,
  "prevPage": 7,
  "nextPage": 9,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "dense",
  "nDataPoints": 6,
  "notes": "This is a research note page detailing accounting concerns regarding HASI's relationship with SunStrong.",
  "elementsJson": [
    "paragraph",
    "bullet_list",
    "footnote"
  ],
  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b97-386a39fe2e3c/8",
  "deckHref": "/decks/019dd923-622c-750b-8b97-386a39fe2e3c",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b97-386a39fe2e3c.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b97-386a39fe2e3c#slide-8",
  "components": [
    {
      "bbox": null,
      "kind": "callout",
      "text": "HASI appears to have booked non-cash interest income from SunStrong PIKs totaling $26.4 million over 2019-2021 per SunStrong’s cash flow statement, which is approximately 9.5% of HASI’s interest income during this time.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd953-0931-74b9-a332-09a493773744",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.12,
        "w": 0.75,
        "x": 0.14,
        "y": 0.48
      },
      "kind": "list",
      "text": "SunStrong Capital Lender 6 LLC, a HASI entity; HAT Ultralight Capital Lender 2 LLC, a HASI entity; HAT Ultralight Capital Lender LLC, a HASI entity; HAT Terrier Capital Lender LLC, a HASI entity, and Key Bank; SunStrong Capital Lender 2 LLC, a HASI entity; SunStrong Capital Lender 3 LLC, a HASI entity; SunStrong Capital Lender LLC, a HASI entity.",
      "attrs": null,
      "subkind": "bullet",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "74d0c451-f993-4b4f-ae7b-eee3b3b6ce0e",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "metric",
      "text": "PIK interest income: $26.5 million",
      "attrs": null,
      "subkind": "primary",
      "toolName": "Quantification",
      "toolSlug": "quantification",
      "confidence": null,
      "componentId": "019dd953-0931-74b9-a332-0d78d8e03122",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.11,
        "w": 0.78,
        "x": 0.11,
        "y": 0.33
      },
      "kind": "paragraph",
      "text": "HASI appears to have booked non-cash interest income from SunStrong PIKs totaling $26.4 million over 2019-2021 per SunStrong's cash flow statement... SunStrong's individual filings show that SunStrong had 16 loans with balances outstanding as of the end of 2021.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "6dc35e72-04d5-4ee9-8b88-99bfede2ec53",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.06,
        "w": 0.78,
        "x": 0.11,
        "y": 0.19
      },
      "kind": "paragraph",
      "text": "At the same time, we believe HASI's claimed SunStrong income was much higher than SunStrong's own earnings. SunStrong passed HASI's income significance test in 2020, which should mean that SunStrong had generated 20% or more of HASI's 2020 operating income.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "c0f7fd20-6944-4eaa-be61-fa0f749f050f",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.06,
        "w": 0.78,
        "x": 0.11,
        "y": 0.09
      },
      "kind": "paragraph",
      "text": "project assets, which is 20 years or more. As we discuss infra, we believe that HASI abuses its position as a minority equity investor by recording unrealizable income from EMIs when no cash does, or will ever, change hands for HASI.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "e3aa5830-7d84-4252-9835-9f4376e7d6f0",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.25,
        "w": 0.78,
        "x": 0.11,
        "y": 0.68
      },
      "kind": "source-note",
      "text": "27-34 footnotes detailing financial disclosures and SEC filings.",
      "attrs": null,
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "c7ae7bc6-216c-47ef-89d2-2bd1e799a559",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.03,
        "w": 0.78,
        "x": 0.11,
        "y": 0.29
      },
      "kind": "title",
      "text": "HASI Apparently Booked $26.5 Million in Interest Income from SunStrong PIKs",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "17b54a3a-ccd8-4e10-8148-4477b4db4817",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [
    {
      "name": "fraud-exposure",
      "slug": null,
      "matchId": "bd065ade-bd98-4965-9d82-2e188d9bd6c8",
      "evidence": "The slide explicitly argues that HASI is abusing its position to record unrealizable income.",
      "confidence": 0.9
    }
  ],
  "arcBeats": [],
  "loops": [],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}