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SEC Filings
10-K
TERRAFORM POWER, INC. filed this Form 10-K on 07/21/2017
Entire Document
 

Loss (Gain) on Extinguishment of Debt, net

We incurred a net loss on extinguishment of debt of $16.2 million for the year ended December 31, 2015, driven by the following: i) the termination of the Term Loan and related interest rate swap, ii) the exchange of the previous revolver to the Revolver, iii) prepayment of premium paid in conjunction with the payoff of First Wind indebtedness at the acquisition date, and iv) the refinancing of project-level indebtedness of our U.K. portfolio. These losses were partially offset by a gain resulting from the termination of financing lease obligations upon acquisition of the Duke Energy operating facility. The net gain on extinguishment of debt of $7.6 million for the year ended December 31, 2014 was primarily due to termination of financing lease obligations upon acquiring the lessor interest in the SunE Solar Fund X portfolio of solar generation facilities. The net loss (gain) on extinguishment of debt for the years ended December 31, 2015 and 2014 related to the following corporate-level debt instruments and renewable energy facility portfolios:
 
 
Year Ended December 31,
(In thousands)
 
2015
 
2014
Term Loan extinguishment and related fees
 
$
12,320

 
$

Revolver
 
1,306

 

First Wind
 
6,412

 

Duke Energy operating facility
 
(11,386
)
 

U.K. Refinancing
 
7,504

 

U.S. Projects 2009-2013
 

 
2,459

Alamosa
 

 
1,945

Stonehenge Operating
 

 
3,797

SunE Solar Fund X
 

 
(15,836
)
Total net loss (gain) on extinguishment of debt
 
$
16,156

 
$
(7,635
)

Loss on Foreign Currency Exchange, net

We incurred a net loss on foreign currency exchange of $19.5 million for the year ended December 31, 2015, driven by a $22.3 million unrealized loss on the remeasurement of intercompany loans, which are primarily denominated in British pounds, due to strengthening of the U.S. dollar. These remeasurement losses were partially offset by $3.6 million of realized and unrealized net gains on foreign currency derivatives.

Loss on Investments and Receivables - Affiliate

As a result of the SunEdison Bankruptcy, we recognized an $11.3 million loss on investment as a result of residential project cancellations. Further, we recognized an additional $4.8 million loss related to recording a bad debt reserve for outstanding receivables from the SunEdison Debtors.    

Income Tax Provision

Income tax benefit was $13.2 million for the year ended December 31, 2015, compared to an income tax benefit of $4.7 million  during the same period in 2014. The increased benefit in 2015 is primarily driven by the intraperiod allocation rules under ASC 740, as the Company recognized $14.6 million of offsetting income tax expense in other comprehensive loss. For the year ended December 31, 2015, the overall effective tax rate was different than the statutory rate of 35% primarily due to the recording of a valuation allowance on certain tax benefits attributed to us and due to lower statutory income tax rates in our foreign jurisdictions and due to the intraperiod allocation rule discussed above. For the year ended December 31, 2014, the tax benefits for losses realized prior to the IPO were recognized primarily because of existing deferred tax liabilities. As of December 31, 2015, most jurisdictions were in a net deferred tax asset position. A valuation allowance was recorded against the deferred tax assets primarily because of the history of losses in those jurisdictions.

Pre-acquisition Net Loss of Renewable Energy Facilities Acquired from SunEdison

Pre-acquisition net loss of renewable energy facilities acquired from SunEdison was $1.6 million for the year ended December 31, 2015, compared to a net loss of $1.5 million during the same period in 2014. The change of $3.1 million was primarily due to the $45.4 million impairment charge related to a wind power plant due to a significant decline in power prices and a resulting decline in the fair value of the acquired wind plant as discussed above.


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