XML 38 R19.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Debt and Financing Lease Liabilities | 12 Months Ended
--- | ---
Dec. 31, 2023
Debt Disclosure [Abstract] |
Debt and Financing Lease Liabilities | DEBT AND FINANCING LEASE LIABILITIES Debt was comprised of the following:
| As of December 31,
| 2023 |  | 2022
Senior secured credit facility, 9.12%, due January 2024 to March 2025 (1) (8) | $ | 279,900 |  |  | $ | 477,900 |
June 2020 construction revolver, 6.96%, due March 2024 (2) (8) | $ | 20,705 |  |  | $ | 39,536 |
July 2020 construction revolver, 5.92%, due June 2023 (2) (8) | — |  |  | 5,855 |
April 2023 construction credit facility, 6.82%, due July 2024 | 134,415 |  |  | — |
August 2023 construction credit facility, 9.34%, due August 2026 | 278,858 |  |  | — |
August 2023 construction revolver, 6.85%, due April 2030 | 36,270 |  |  | — |
Subtotal energy asset construction facilities | $ | 470,248 |  |  | $ | 45,391 |
January 2006 variable rate term loan, 0.00%, due June 2024 (2) (3) | $ | — |  |  | $ | 3,403 |
October 2011 term loan, 6.11% due June 2028 (5) | 1,976 |  |  | 2,348 |
October 2012 variable rate term loan, 7.88%, due June 2025 (4) (8) | 34,453 |  |  | 37,204 |
September 2015 variable rate term loan, 7.21%, due March 2028 (4) (8) | 13,747 |  |  | 14,084 |
August 2016 term loan, 4.95%, due June 2031 (4) | 2,253 |  |  | 2,588 |
March 2017 term loan, 5.00%, due March 2028 (4) | — |  |  | 2,258 |
April 2017 term loan, 4.50%, due April 2027 (5) | — |  |  | 1,846 |
April 2017 term loan, 5.61%, due February 2034 (4) | 1,348 |  |  | 1,437 |
June 2017 variable rate term loan, 7.81%, due December 2027 (4) (8) | 7,158 |  |  | 7,874 |
June 2018 term loan, 5.15%, due December 2038 (2) (4) | 21,063 |  |  | 23,255 |
June 2018 variable rate term loan, 7.41%, due June 2033 (2) (8) (3) | 6,592 |  |  | 6,951 |
October 2018 variable rate term loan, 7.86%, due October 2029 (2) (8) (5) | 6,145 |  |  | 6,977 |
November 2020 fixed rate note, 3.58%, due December 2027 (4) | 2,004 |  |  | 2,425 |
June 2021 fixed rate note, 4.92%, due June 2045 (4) | 3,489 |  |  | 3,474 |
July 2021 fixed rate note, 3.25%, due March 2046 (2) (4) | 35,090 |  |  | 37,302 |
July 2021 variable rate term loan, 9.01%, due July 2030 (2) (4) (8) | 2,140 |  |  | 2,915 |
June 2022 fixed rate shelf note, 5.45%, due March 2042 (2) (4) | 6,395 |  |  | 6,859 |
October 2022 fixed rate financing facility, 6.70%, due August 2039 | 349,093 |  |  | 92,203 |
March 2023 fixed rate shelf note 5.99%, due, December 2047 (2) (4) | 21,984 |  |  | — |
August 2023 seller's promissory note, 5.00%, due January 2024 | 28,294 |  |  | — |
August 2023 fixed rate note, 5.70%, due April 2047 (2) | 3,520 |  |  | — |
Various Enerqos financing facilities | 17,786 |  |  | — |
Subtotal energy asset term loans | $ | 564,530 |  |  | $ | 255,403 |
August 2018 master sale-leaseback, 0.00% to 1.86%, due July 2039 to July 2047 (3) (6) | $ | 163,504 |  |  | $ | 104,011 |
December 2020 master sale-leaseback, 0.00%, due December 2040 to March 2043 (4) (6) | 22,194 |  |  | 16,912 |
Subtotal sale-leasebacks | $ | 185,698 |  |  | $ | 120,923 |
Financing leases (7) | $ | 13,928 |  |  | $ | 16,060 |
Total debt and financing leases | $ | 1,514,304 |  |  | $ | 915,677 |
Less: current maturities, net of unamortized discount | 322,247 |  |  | 331,479 |
Less: unamortized discount and debt issuance costs | 21,982 |  |  | 15,563 |
Long-term debt and financing lease liabilities, net of current portion, unamortized discount and debt issuance costs | $ | 1,170,075 |  |  | $ | 568,635 |
(1) Facility has interest at varying rates monthly in arrears.
(2) These agreements have acceleration causes that, in the event of default, as defined, the payee has the option to accelerate payment terms and make the remaining principal and the required interest balance due according to the agreement.
(3) Facility is payable in semi-annual installments.
(4) Facility is payable in quarterly installments.
(5) Facility is payable in monthly installments.
(6) These agreements are sale-leaseback arrangements and are accounted for as failed sales under the guidance and are classified as financing liabilities. See Note 8.
(7) Financing leases are sale-leaseback arrangements under previous guidance and do not include approximately $12,468 in future interest payments as of December 31, 2023 and $14,212 as of December 31, 2022. See Note 8.
(8) These agreements are now using the Secured Overnight Financing Rate (“SOFR”) as the primary reference rate used to calculate interest.
The following table presents the aggregate maturities of long-term debt and financing leases as of December 31, 2023:
2024 | $ | 324,423 |
2025 | 298,569 |
2026 | 340,080 |
2027 | 62,162 |
2028 | 59,250 |
Thereafter | 429,820 |
Total maturities | $ | 1,514,304 |
Senior Secured Credit Facility - Revolver and Term Loans In March 2022, we entered into the fifth amended and restated senior secured credit facility with five banks, which included the following amendments: •increased the aggregate amount of total commitments from $245,000 to $495,000, •increased the aggregate amount of the revolving commitments from $180,000 to $200,000, •increased the existing term loan A from $65,000 to $75,000, •extended the maturity date of the revolving commitment and term loan A from June 28, 2024 to March 4, 2025, •added a delayed draw term loan A for up to $220,000 through a September 4, 2023 maturity date, •increased the total funded debt to EBITDA covenant ratio from a maximum of 3.50 to 4.50 for the quarter ended March 31, 2022; 4.25 for the quarter ending June 30, 2022, 4.00 for the quarters ending September 30, 2022 and December 31, 2022; and 3.50 thereafter, •specified the debt service coverage ratio (the ratio of (a) cash flow of the core Ameresco companies, to (b) debt service of the core Ameresco companies as of the end of each fiscal quarter) to be less than 1.5, and •increased our limit under an energy conversation project financing to $650,000, which provides us with flexibility to grow our federal business further. We accounted for this amendment as a modification and at closing we incurred $2,048 in lenders fees which were reflected as debt discount and $352 in third party fees which were reflected as debt issuance costs. The unamortized debt discount and issuance costs of the previous agreement are being amortized over the remaining term of the amended agreement, with the exception of $96 of costs relating to a previous syndicated lender which did not participate in this amendment. These costs were expensed in other expenses, net during the year ended December 31, 2023. In June 2022, we entered into the first amendment to the fifth amended and restated senior secured credit facility, which increased the maximum indebtedness incurred under an energy conservation project financing from $650,000 to $725,000 from and after April 1, 2022, to and including December 30, 2022. As of December 31, 2022, the maximum indebtedness incurred under an energy conservation project financing reverted back to $650,000. On March 17, 2023, we entered into amendment number two to the fifth amended and restated senior secured credit facility with five banks to increase the total funded debt to EBITDA covenant ratio from a maximum of 3.50 to 4.00 for the quarters ending March 31, 2023 and June 30, 2023, and 3.50 thereafter. On August 24, 2023, we entered into amendment number three to the fifth amended and restated senior secured credit facility to extend the maturity date of the delayed draw term loan A, such that after paying $55,000 in connection with the amendment in August 2023, $45,000 was due November 15, 2023, and the remaining principal amount was due December 15, 2023. The amendment also increased the total funded debt to EBITDA covenant ratio from a maximum of 3.50 to 4.25 for the quarter ending September 30, 2023, and 3.50 thereafter. On December 11, 2023, we entered into amendment number four to the fifth amended and restated senior secured credit facility to extend the maturity date of the delayed draw term loan A where $10,000 was due and paid on both January 31, 2024 and February 14, 2024, and an additional $10,000 payment due is on March 31, 2024. The remaining principal amount of $35,000 is due on April 15, 2024. There is also an additional 0.125% fee on the delayed draw term loan A, with $81 due on January 31, 2024, $69 due on February 29, 2024, and $56 due on March 31, 2024. The overall rate table for all loans under the current agreement was also increased by 0.25%. The amendment also increased the total funded debt to EBITDA covenant ratio from a maximum of 3.50 to 3.75 for the quarter ending December 31, 2023, and 3.50 thereafter. We made principal payments on the delayed draw term loan A totaling $155,000 during the year ended December 31, 2023. The amendment also added a covenant that requires Ameresco to use commercially reasonable efforts assuming normal market conditions to raise and, by April 15, 2024, close on a minimum of $100,000 equity or subordinated debt financing if the Cathode site under the Southern California Edison (“SCE”) contract does not achieve substantial completion by January 31, 2024, which was not achieved. Net proceeds from such financing would be required to be used to repay outstanding amounts on the senior secured credit facility. The revolving credit facility may be increased up to an additional $100,000 in increments of at least $25,000 at the approval of lenders, subject to certain conditions. Up to $20,000 of the revolving credit facility may be borrowed in Canadian dollars, Euros, or pounds sterling. We are the sole borrower under the credit facility. The obligations under the credit facility are guaranteed by certain of our direct and indirect wholly owned domestic subsidiaries and are secured by a pledge of all of Ameresco’s and such subsidiary guarantors’ assets, other than the equity interests of certain subsidiaries and assets held in non-core subsidiaries (as defined in the agreement). The table below sets forth amounts outstanding under the senior credit facility:
| Rate as of December 31, 2023 |  | As of December 31,
|  | 2023 |  | 2022
Term loan A | 8.70 | % |  | $ | 75,000 |  |  | $ | 75,000 |
Delayed draw term loan A | 8.70 | % |  | $ | 65,000 |  |  | $ | 220,000 |
Revolving credit facility | 9.54 | % |  | $ | 139,900 |  |  | $ | 182,900 |
Total senior secured credit facility outstanding | $ | 279,900 |  |  | $ | 477,900 |
Less: unamortized debt discount and debt issuance costs | $ | (884) |  |  | $ | (1,562) |
Total senior secured credit facility outstanding, net | $ | 279,016 |  |  | $ | 476,338 |
As of December 31, 2023, funds of $37,489 were available for borrowing under the revolving credit facility and we had $12,868 in letters of credit outstanding. We expect to use the remaining funds available under the credit facility for general corporate purposes, including permitted acquisitions, refinancing of existing indebtedness and working capital. The interest rate for borrowings under the credit facility is based on (i) each term loan shall bear interest at the term SOFR for such interest period plus the applicable rate for such facility; (ii) each base rate loan shall bear interest at a rate per annum equal to the base rate plus the applicable rate; (iii) each alternative currency daily rate loan shall bear at a rate per annum equal to the alternative currency daily rate plus the applicable rate; (iv) each alternative currency term rate loan shall bear interest at a rate per annum equal to the alternative currency term rate for such interest period plus the applicable rate; and (v) each swingline loan shall bear interest at a rate per annum equal to the base rate plus the applicable rate. The revolving credit facility does not require amortization of principal. The term loan requires quarterly principal payments of $1,250 beginning in the first quarter of 2024, with the balance due at maturity. All borrowings may be paid before maturity in whole or in part at our option without penalty or premium, other than reimbursement of any breakage and deployment costs in the case of LIBOR borrowings. The credit facility limits Ameresco’s and our subsidiaries’ ability to, among other things: incur additional indebtedness; incur liens or guarantee obligations; merge, liquidate or dispose of assets; make acquisitions or other investments; enter into hedging agreements; pay dividends and make other distributions and engage in transactions with affiliates, except in the ordinary course of business on an arms’ length basis. Under the credit facility, Ameresco and our core domestic subsidiaries may not invest cash or property in, or loan to, our non-core subsidiaries in aggregate amounts exceeding 49% of our consolidated stockholders’ equity. In addition, we and our core subsidiaries must maintain a ratio of total funded debt to EBITDA as noted above, and a debt service coverage ratio (as defined in the agreement) of at least 1.5 to 1.0. Any failure to comply with the financial or other covenants of the credit facility would not only prevent us from being able to borrow additional funds, but would constitute a default, permitting the lenders to, among other things, accelerate the amounts outstanding, including all accrued interest and unpaid fees, under the credit facility, to terminate the credit facility, and enforce liens against the collateral. The credit facility also includes several other customary events of default, including a change in control of Ameresco, permitting the lenders to accelerate the indebtedness, terminate the credit facility, and enforce liens against the collateral. For purposes of our senior secured facility, EBITDA, as defined, excludes the results of certain renewable energy projects that we own and for which financing from others remains outstanding; total funded debt, as defined, includes amounts outstanding under both the term loan and revolver portions of the senior secured credit facility plus other indebtedness, but excludes limited recourse indebtedness of project company subsidiaries; and debt service, as defined, includes principal and interest payments on the indebtedness included in total funded debt other than principal payments on the revolver portion of the facility. Energy Asset Construction Facilities June 2020 Construction Revolver, 6.96%, due March 2024 In June 2020, we entered into a revolving construction loan agreement with a bank, with an aggregate borrowing capacity of $100,000 for use in financing the construction cost of our owned projects. In December 2022, we amended and restated the June 2020 construction loan agreement which modified the reference rate from LIBOR to SOFR as a result of the expected cessation of LIBOR. Per the amendment, this instrument will bear interest at the applicable term SOFR rate plus an applicable margin of 1.61%. During the year ended December 31, 2023, we entered into amendments to extend this revolver and the current maturity date is March 2024. During the year ended December 31, 2023, we drew down $11,809 under this revolver. As of December 31, 2023, $20,705 was outstanding and $79,295 was available for borrowing. March 2023 Construction Credit Facility, 2.00% On March 31, 2023, we entered into a credit agreement for a construction facility with a total commitment of CAD$100,000 which has an availability period of five years. As of December 31, 2023, no funds were drawn under this facility. During the availability period the loans will bear interest at a fixed rate of 2.00% and during the operating period the rate will range from 1.00% to 3.00% as set forth in the agreement. The maturity date is the earlier of twenty years from project commencement date or one year prior to the termination date of the last remaining energy services agreements. April 2023 Construction Credit Facility, 6.82%, due July 2024 On April 18, 2023, one of our consolidated joint venture subsidiaries (“JV”) entered into a construction loan agreement with two lenders for a principal amount of up to $140,844 under an energy asset credit facility. At the closing, the JV drew down $90,921 for construction of an energy asset and subsequently drew down an additional $43,493 as of December 31, 2023. Monthly payments of interest only on the loan will be due and payable in accordance with the provisions as set forth in the agreement. Any outstanding principal of the loan shall be paid in full no later than the maturity date (or in any event upon acceleration of the loan), together with all accrued and unpaid interest on such amount. The loan will be repaid after the energy asset project achieves provisional acceptance, through a sale-leaseback financing under lease agreements entered into between the same parties, as part of the closing documents. We acquired the remaining interest in this JV in January 2024 when we closed on the acquisition of BCE. August 2023 Construction Credit Facility, 9.34%, due August 2026 On August 18, 2023, we entered into a construction and development loan agreement which provides a loan in a principal amount of up to $300,000. At the closing, we drew down $200,000 under this facility, of which approximately $187,000 was used to reimburse Ameresco for development and construction costs. Subsequent to closing, we drew down an additional $78,857. The loan bears interest at a rate of 4.00% plus the greater of (i) Term SOFR for a one-month tenor and (ii) the 10-year United States treasury rate and a fee equal to 0.250% of any unused committed principal amount. The loan matures on August 31, 2026, with a one-year extension option that can be exercised if certain circumstances are met, including payment of a $3,000 extension fee. We plan to accrue the extension fee if the extension becomes probable. The obligations under the loan are guaranteed by all the related subsidiaries and are secured by the subsidiaries’ assets as well as our equity interest in the borrower entity and in the case of default under the facility, a default under our Senior Secured Credit Facility or a change in control of Ameresco, Inc., we are required to make capital contributions to the borrower entity who then would be required to use the proceeds from the capital contributions to repay the construction and development loan. Energy Asset Financing Facilities and Term Loans October 2022 Financing Facility, 6.70%, due August 2039 In October 2022, one of our subsidiaries entered into a loan agreement with a new lender under a credit facility, refinancing a previous credit facility originally signed on October 23, 2020, which was scheduled to expire March 31, 2026. The new loan was scheduled to mature on October 26, 2037, provided a principal amount of up to $125,000 and bore interest at a rate of 6.50% with a residual percentage of distributable cash flows payable after the maturity date of the loan, until the earlier of the lender achieving an 8.25% “IRR” on funds borrowed under the facility, or the facility discharge date on October 26, 2047. The principal and interest payments are due in quarterly installments based on a five-year amortization schedule with the principal payments being adjusted based on the distributable cash flows from the three renewable natural gas projects owned and operated by the project companies. No up-front, commitment or structuring fees were payable on the credit facility. The obligations under the loan are guaranteed by all the related subsidiaries and are secured by the subsidiaries’ assets as well as our equity interest in the signing subsidiary. Borrowings under the credit facility are otherwise non-recourse to Ameresco. At the closing, we drew down $80,000 under this facility, approximately $26,530 of which was used to repay all amounts outstanding under the prior loan and the remainder was used to terminate swap obligations, pay transaction costs, make permitted distributions to Ameresco and for the project companies’ working capital needs. In addition, we terminated an interest rate swap and a commodity swap related to the prior loan before their maturity dates. These swap terminations resulted in a settlement gain on undesignated derivatives of $694. On December 21, 2022, we drew down an additional $15,000 under this facility. On March 31, 2023, we drew down $30,000 under this facility and on May 31, 2023, we entered into the first amendment to the loan agreement that increased the original commitment of $125,000 by an additional $90,000 to $215,000 and at closing we drew down the $90,000. The first amendment also contained the following amended terms: •The loan bears interest on the unpaid principal amount thereof from the date made through repayment at an interest rate of 6.38% per annum compared to the original rate of 6.50%. •The loan maturity date was changed from October 26, 2037 to May 31, 2038 On September 28, 2023, we amended and restated this facility to increase the maximum commitment from $215,000 to $500,000, to continue existing loans to project companies, to add certain renewable natural gas project companies to the loan portfolio, and to provide that additional wholly- and majority-owned project companies may be added to the loan portfolio subject to certain conditions. At the closing of the amendment and restatement, we drew down an additional $135,544 under the loan, which was used to pay transaction costs, reimburse project costs incurred by us, make other permitted distributions to Ameresco, and to fund the required reserve accounts. Subject to certain conditions, the facility allows for additional draws to be made up to the remaining principal amount to fund the construction and operation of renewable natural gas projects owned and operated by the project companies. The amendment and restatement also contained the following amended terms: •The loan bears interest at a rate of 6.70% with a residual percentage of distributable cash flows payable after the maturity date of the loan, until the earlier of the lender achieving an 8.51% internal rate of return (“IRR”) on funds borrowed under the facility, or the facility discharge date which was extended to August 31, 2049. •The loan maturity date was changed from May 31, 2038 to August 31, 2039 •All borrowings may be paid before maturity in whole or in part at RNG Holdings’ option after August 30, 2027 provided that the lender’s IRR is achieved, and against a prepayment of 102% of par for prepayments between August 31, 2027 and August 31, 2029 and 101% of par for prepayments between September 1, 2029 and August 30, 2031. No call premium applies for payments after August 30, 2031. At closing, we incurred lender’s fees of $509, which was recorded as debt discount, and $305 in debt issuance costs which were expensed in other expenses, net during the year ended December 31, 2023. In December 2023, we drew down an additional $21,176 under this facility and as of December 31, 2023, $348,020 was outstanding, net of unamortized debt discount and issuance costs of $1,073. June 2022 Term Shelf Notes, 5.45%, due March 2042 under July 2021 Financing Facility In June 2022, two senior secured notes (“Shelf Notes”) due March 31, 2042 were issued under our shelf facility, with gross proceeds of $7,113. The Shelf Notes bear interest at a fixed rate of 5.45% per annum and are payable quarterly commencing September 30, 2022. March 2023 Term Shelf Notes 5.99%, due December 2047 under July 2021 Financing Facility On March 28, 2023, three senior secured notes (“Shelf Notes”) due December 31, 2047 were issued under our shelf facility, with gross proceeds of $22,625. The Shelf Notes bear interest at a fixed rate of 5.99% per annum and are payable quarterly commencing June 30, 2023. At closing, we incurred $282 in lender fees and debt issuance costs. In connection with the Shelf Notes, we recorded a derivative instrument for make-whole provisions with an initial value of $3,123, which was recorded as a debt discount. September 2015 Variable Rate Term Loan, 7.21%, due March 2028 On March 30, 2023, we entered into an amended and restated financing agreement (“Amended Agreement”) with the existing bank that extended the maturity date of the loan from March 30, 2023 to March 28, 2028. The Amended Agreement consists of a term loan of $14,084, an incremental term loan of $359 and a letter of credit of $899. The term loan bears interest at a variable rate, with interest payments due in quarterly installments. The rate at December 31, 2023 was 7.21% per annum. The remaining principal balance and unpaid interest is due March 28, 2028. As a result of this refinancing, we entered into a new interest rate swap contract with an initial notional amount of $14,084 and termination date of December 31, 2040. See Note 19 Derivative Instruments and Hedging Activities for additional information on this new swap contract. Debt Instruments - Energy Project Asset Acquisition As discussed in Note 4, on August 4, 2023, we acquired an energy asset project. The adjusted purchase price for phase 1 was $87,964. August 2023 Construction Revolver, 6.85%, due April 2030 In connection with the acquisition, we assumed a construction loan in the amount of $36,270. The construction loan bears interest at a monthly variable SOFR term rate, which was 6.85% per annum. Subject to the terms and conditions contained in the assumed credit agreement, the construction loan should have been converted into a term loan on or prior to July 31, 2023. On February 26, 2024, we received a waiver on this default and converted $36,270 of the construction loan into a term loan, which has a maturity date of April 2030. Therefore, the construction loan was classified as non-current at December 31, 2023. August 2023 Seller’s Promissory Note, 5.00%, due January 2024 We financed a portion of the purchase price for this acquisition through a seller’s note in the amount of $46,694. In September 2023, we paid $12,500 in principal on the seller’s promissory note and paid interest at a rate of 5.00%. As of December 31, 2023, the balance of the seller’s note was $28,294 after $5,900 was paid on December 27, 2023. The remaining balance was paid in January 2024, without bearing interest. Various Enerqos Financing Facilities Enerqos has several financing facilities with maturity dates from March 31, 2024 to June 30, 2028 with interest rates ranging from 5.1% to 8.0%.

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for long-term debt. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 470 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//470/tableOfContent + Details
Name: | us-gaap_LongTermDebtTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration